WORLD TRADE  
ORGANIZATION  WT/DS367/R 
9 August 2010 
 (10-3998) 
 Original:   English 
 
    
 
  
 
  
 
  
AUSTRALIA – MEASURES AFFECTING THE 
IMPORTATION OF APPLES FROM NEW ZEALAND 
 
 
Report of the Panel 
  WT/DS367/R 
 Page i 
 
 
  TABLE OF CONTENTS 
Page  
 
I. INTRODUCTION ................................................................................................................... .1 
A. REQUEST FOR CONSULTATIONS ...................................................................................................1  
B. ESTABLISHMENT AND COMPOSITION OF THE PANEL ...................................................................1  
C. PANEL PROCEEDINGS ..................................................................................................................2  
1. Adoption of the Working Procedures and the timetable.......................................................2  
2. Request for a preliminary ruling raised by Australia ...........................................................2  
3. Revisions of th e timetable..................................................................................................... ....3 
4. First written submissions by the Parties and Third Party submissions...............................4  
5. Second request for a preliminary ruling raised by Australia ...............................................4  
6. Unsolicited letter from an Australian private entity..............................................................5  
7. Substantive meeting of the Panel with the Parties and the Third Parties ...........................5  
8. Agreement regarding one of the measures identified by New Zealand ...............................6  
9. Expert consultation process .................................................................................................... .6 
(a) Selection of experts and pr eparation of questions ......................................................................6  
(b) Due process concerns ra ised by Australia.................................................................................12  
(c) Additional revisions of the timetable........................................................................................12  
10. Written rebuttal submissi ons by the Parties ........................................................................14  
11. Second substantive meeting of the Panel with the Parties and Panel's meeting 
with the experts ............................................................................................................... ........14  
12. Issuance of th e report ......................................................................................................... ....15  
II. FACTUAL ASPECTS ............................................................................................................15  
A. PESTS AT ISSUE ..........................................................................................................................15  
1. Fire blight .................................................................................................................... ............15  
(a) Host plants .................................................................................................................... ............15  
(b) Life cycle ..................................................................................................................... .............16  
(c) Spread ......................................................................................................................... ..............16  
(d) Geographical distribution...................................................................................................... ....17  
2. European canker................................................................................................................ .....17  
(a) Host plants .................................................................................................................... ............17  
(b) Life cycle ..................................................................................................................... .............17  
(c) Spread ......................................................................................................................... ..............18  
(d) Geographical distribution...................................................................................................... ....19  
3. Apple leafcur ling midge ........................................................................................................ .19 
(a) Host plants .................................................................................................................... ............19  WT/DS367/R 
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  (b)
 Life cycle ..................................................................................................................... .............19  
(c) Spread ......................................................................................................................... ..............20  
(d) Geographical distribution...................................................................................................... ....20  
B. THE FINAL IRA REPORT ..............................................................................................................21  
1. Chronology ..................................................................................................................... .........21  
2. Methodology .................................................................................................................... ........22  
(a) Process of pest risk assessment................................................................................................ .22 
(b) Pest categorization ............................................................................................................ ........23  
(c) Assessment of the probability of entry, establishment and spread ...........................................24  
(i) Probability of entry........................................................................................................... ........24  
(ii) Importation steps and biological pathways ..............................................................................24  
(iii) Probability of establishment and spread ..................................................................................26  
(d) Assessment of consequences ....................................................................................................2 7 
(e) Unrestricted risk.............................................................................................................. ..........28  
3. Risk management measures and Australia's  appropriate level of protection...................28  
4. The IRA's semi-quantitative approach.................................................................................29  
C. RELEVANT INTERNATIONAL STANDARDS , GUIDELINES AND RECOMMENDATIONS ..................31  
1. The IPPC ....................................................................................................................... ..........31  
(a) IPPC standards on risk analysis:  ISPM No. 2 and ISPM No. 11.............................................31  
(b) IPPC standards on pest free areas and areas of low pest prevalence:  ISPM No. 4, 
ISPM No. 10 and ISPM No. 22 ................................................................................................33  
(c) Other ISPMs .................................................................................................................... .........35  
D. MEASURES AT ISSUE ..................................................................................................................35  
1. The measures at issue are limit ed to 17 specific measures..................................................35  
2. The 17 specific measures and their relatio nship to the three pests at issue.......................36  
3. The Parties' agreemen t on Measure 12.................................................................................39  
4. The remaining 16 specific measures at  issue spelt out in the IRA......................................39  
5. Disagreements on some of the 16 specific measures at issue...............................................41  
(a) Measure 1...................................................................................................................... ............41  
(b) Measure 4...................................................................................................................... ............47  
(c) Measure 11..................................................................................................................... ...........53  
(d) Measure 15..................................................................................................................... ...........57  
(i) The Parties' arguments ......................................................................................................... ....57  
(ii) The Panel's analysis........................................................................................................... .......67  
6. Territorial applicability of the measures at issue.................................................................73  
7. Legal issues to be addressed in th e findings section of the report ......................................73   WT/DS367/R 
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  E. PRODUCT AT ISSUE ....................................................................................................................74  
1. The Parties' arguments......................................................................................................... ..74 
2. The Panel's analysis ........................................................................................................... .....76  
III. PARTIES' REQUESTS FOR FIND INGS AND RECOMMENDATIONS.......................77  
IV. ARGUMENTS OF THE PARTIES ......................................................................................78  
A. NEW ZEALAND ..........................................................................................................................78  
1. Executive summary of New Zealand's first written submission.........................................78  
(a) Introduction................................................................................................................... ............78  
(b) Background..................................................................................................................... ..........78  
(c) Legal analysis ................................................................................................................. ..........79  
(i) Australia's measures are incons istent with Article 2.2 .............................................................79  
(ii) Australia's measures are incons istent with Article 5.1 .............................................................81  
(iii) Australia's measures are incons istent with Article 5.2 .............................................................83  
(iv) Australia's measures are inconsistent with Article 5.5 and Article 2.3 ....................................83  
(v) Australia's measures are incons istent with Article 5.6 .............................................................83  
(vi) Australia's measures are inconsistent with Article 8 and Annex C(1)(a) .................................84  
(d) Conclusion ..................................................................................................................... ...........84  
2. Executive summary of New Zealand's opening oral statement at the first 
substantive meeting............................................................................................................ .....84  
(a) Introduction................................................................................................................... ............84  
(b) Product at issue ............................................................................................................... ..........84  
(c) Measures at issue .............................................................................................................. ........85  
(d) The applicable law ............................................................................................................. .......85  
(i) Standard of review ............................................................................................................. .......85  
(ii) Order of analysis .............................................................................................................. ........85  
(iii) Burden of proof................................................................................................................ .........86  
(e) Article 2.2 .................................................................................................................... .............86  
(i) Fire blight .................................................................................................................... .............86  
(ii) European canker................................................................................................................ .......87  
(iii) ALCM........................................................................................................................... .............87  
(f) Article 5.1 .................................................................................................................... .............88  
(i) Australia has not evaluated the likelihood of entry, establishment or spread ..........................88  
Fundamental flaws in the IRA................................................................................................... .............. 88  
New Zealand does not conduct its own risk assessment nor has Australia identified "very 
significant de ficiencies" ...................................................................................................... .................... 89  
There are important errors in the IRA's analysis  of the entry, establishment and spread in 
respect of each pe st ........................................................................................................... ...................... 89  WT/DS367/R 
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  Fire blight .................................................................................................................... .................... 89  
European canker ................................................................................................................ .............. 89  
ALCM........................................................................................................................... ................... 90  
(ii) Australia has not evaluated likelihood "according to the SPS measures which might 
be applied".................................................................................................................... ............90  
(g) Article 5.2, 5.5 and 5.6....................................................................................................... .......91  
(h) Article 8 and Annex C .......................................................................................................... ....91  
3. New Zealand's closing oral statement at the first substantive meeting..............................92  
4. Executive summary of New Zealand's second written submission ....................................93  
(a) Introduction................................................................................................................... ............93  
(b) Detailed rebuttal of Aust ralia's arguments................................................................................94  
(i) Measures at issue.............................................................................................................. ........94  
(ii) Product at issue ............................................................................................................... .........94  
(iii) Standard of review and burden of proof ...................................................................................94  
(iv) Relationship between Articles 2.2 an d 5.1, and order of analysis............................................94  
(v) Australia's measures are incons istent with Article 2.2 .............................................................95  
(vi) Australia's measures are incons istent with Article 5.1 .............................................................96  
(vii) Australia's measures are incons istent with Article 5.2 .............................................................99  
(viii) Australia's measures are incons istent with Article 5.5 .............................................................99  
(ix) Australia's measures are incons istent with Article 5.6 ...........................................................100  
(x) Australia's measures are inconsistent with Article 8 and Annex C(1)(a) ...............................100  
(c) Conclusion ..................................................................................................................... .........100  
5. Executive summary of New Zealand's opening oral statement at the second 
substantive meeting............................................................................................................ ...100  
(a) Introduction................................................................................................................... ..........100  
(b) Australia's second written submission ....................................................................................101  
(c) The task of the Panel.......................................................................................................... .....102  
(i) Standard of review ............................................................................................................. .....102  
(ii) Relationship between Articles 2.2 and 5.1..............................................................................102  
(iii) The weight to be given to Japan – Apples...............................................................................102  
(d) Article 2.2 .................................................................................................................... ...........103  
(i) Fire blight .................................................................................................................... ...........103  
(ii) European canker................................................................................................................ .....103  
(iii) ALCM........................................................................................................................... ...........104  
(e) Article 5.1 .................................................................................................................... ...........105  
(i) Methodology .................................................................................................................... .......105  
(ii) Fire blight .................................................................................................................... ...........106   WT/DS367/R 
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  (iii) European canker................................................................................................................ .....106  
(iv) ALCM........................................................................................................................... ...........107  
(f) Article 8/Annex C.............................................................................................................. .....108  
6. New Zealand's closing oral statement at the second substantive meeting .......................109  
B. AUSTRALIA .............................................................................................................................11 1 
1. Executive summary of Australia's  first written submission .............................................111  
(a) Introduction................................................................................................................... ..........111  
(b) Legal framework................................................................................................................ .....111  
(c) Legal and factual rebuttal..................................................................................................... ...112  
(i) Australia's measures are consistent with Article  5.1, and accordingly,  with Article 2.2........112  
New Zealand misunderstands what is requ ired of a valid risk assessment............................................ 112  
New Zealand's claims in respect of fi re blight are unsu bstantiate d....................................................... 114  
New Zealand's claims in respect of Eu ropean canker are un substantia ted............................................ 114  
New Zealand's claims in respect of ALCM are unsub stantiate d ........................................................... 115  
Conclusion on the risk asse ssment for fire blight, Eu ropean canker and ALCM.................................. 115  
The IRA Team properly evaluated those SPS  measures which might be applied................................. 115  
Conclusion..................................................................................................................... ........................ 116  
(ii) Australia has acted consiste ntly with Article 5.2....................................................................116  
(iii) Alternatively, Australia's measures are n onetheless consistent with Article 2.2....................116  
(iv) Australia's measures are consistent w ith Article 5.5 a nd Article 2.3 .....................................116  
(v) Australia's measures are consis tent with Article 5.6 ..............................................................116  
(vi) New Zealand's claim under Article 8 and Annex C(1)(a) is outside the Panel's terms 
of reference ................................................................................................................... ..........117  
(d) Conclusion ..................................................................................................................... .........117  
2. Executive summary of Australia's opening oral statement at the first substantive 
meeting........................................................................................................................ ...........117  
(a) Introduction................................................................................................................... ..........117  
(b) Australia's appropriate level of protection in action ...............................................................118  
(c) The Final IRA Report provides the b asis for Australia's measures ........................................118  
(d) This dispute is not a re-run of Japan – Apples ........................................................................119  
(e) The product and measures at issue must be identified clearly ................................................119  
(f) New Zealand has not backed up its claims  with evidence and legal argument ......................120  
(g) The Panel's role in this di spute is not unfettered.....................................................................120  
(h) New Zealand disregards the special rela tionship between Articles 5.1 and 2.2 .....................121  
(i) Consequences are an integral part of risk assessment.............................................................122  
(j) Australia's measures addr ess real probabilities.......................................................................122  
(k) New Zealand's and the United States' scientific and technical arguments lack merit.............122  WT/DS367/R 
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  (l)
 New Zealand's secondary claims are flawed...........................................................................123  
(m) New Zealand's undue delay claim is outsi de the scope of this dispute...................................123  
(n) The Panel may take into account amicus curiae submissions as necessary............................123  
(o) Australia is ready to provide its views on the role of experts .................................................124  
(p) Conclusion ..................................................................................................................... .........124  
3. Australia's closing oral statement at  the first substantive meeting ..................................124  
(a) Introduction................................................................................................................... ..........124  
(b) The product at issue is clear.................................................................................................. ..124  
(c) There is a sound basis for the distinction between principal and ancillary measures.............125  
(d) The appropriate standard of review in this dispute.................................................................125  
(e) Australia may rely on divergent scientific opinion.................................................................126  
(f) New Zealand's continued reliance on Japan – Apples is misguided.......................................126  
(g) Likelihood combined with c onsequences equals risk .............................................................126  
(h) Articles 5.1 and 2.2 exist in a special legal relationship .........................................................126  
(i) Australia has comprehensively rebutted New Zealand's Article 2.2 arguments.....................127  
(j) Scientific and technical arguments .........................................................................................127  
(i) European canker................................................................................................................ .....127  
(ii) Apple leafcurling midge........................................................................................................ ..128  
(k) The AQIS audit requirement has been misunderstood by New Zealand ................................128  
(l) New Zealand's secondary claims continue to lack merit ........................................................129  
(m) Timing of the second hearing .................................................................................................12 9 
(n) Conclusion ..................................................................................................................... .........129  
4. Executive summary of Australia's second written submission.........................................130  
(a) Introduction................................................................................................................... ..........130  
(b) Overarching legal arguments ..................................................................................................13 0 
(c) Specific legal arguments....................................................................................................... ..131  
(d) The scientific and technical issues with  respect to Australia's measures................................131  
(i) New Zealand has not shown that the IR A Team's methodology is flawed ..............................131  
(ii) The risk assessment for fire blight  is objectively justifiable ...................................................132  
(iii) The risk assessment for European canker is objectively justifiable........................................133  
(iv) The risk assessment for ALCM is objectively justifiable.........................................................133  
(v) The general measures ........................................................................................................... ..134  
(vi) The IRA Team evaluated likelihood according to the SPS measures which might be 
applied ........................................................................................................................ ............134  
(vii) Australia's measures are not inconsistent with Articles 5.1, 5.2, 2.2 and 5.6.........................134  
(viii) Australia's measures are not inc onsistent with Article 5.5.....................................................135   WT/DS367/R 
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  (ix) New Zealand's undue delay claim remains out side the scope of this dispute.........................135  
(e) Conclusion ..................................................................................................................... .........136  
5. Executive summary of Australia's opening oral statement at the second 
substantive meeting............................................................................................................ ...136  
(a) Introduction................................................................................................................... ..........136  
(b) The practical realities of co nducting risk assessments............................................................136  
(c) Sufficiency of scientific evidence is not equivalent to scientific certainty.............................136  
(d) Standard of review and burden of pr oof remain fundamentally important.............................137  
(e) The Final IRA Report constitutes a scientific opinion............................................................138  
(f) New Zealand seeks to revive its case......................................................................................138  
(g) The role of experts is limited ................................................................................................. .138 
(h) Methodology.................................................................................................................... .......138  
(i) Fire blight.................................................................................................................... ............140  
(i) The fire blight case is esse ntially about the acceptable level of scientific uncertainty 
in risk assessments ............................................................................................................ ......140  
(ii) New Zealand's "pathway" argument is the core of its fire blight case ...................................140  
(iii) The fire blight pathway is substantially confirmed.................................................................140  
(iv) New Zealand's evidence is not relevant  to Australia's circumstances....................................141  
(v) New Zealand has not demonstrated serious  flaws in the Final IRA Report ...........................142  
(j) European canker ................................................................................................................ .....143  
(k) ALCM........................................................................................................................... ..........144  
(l) The measures at issue.......................................................................................................... ....145  
(m) Conclusion ..................................................................................................................... .........146  
6. Australia's closing oral statement at the second substantive meeting..............................146  
(a) Introduction................................................................................................................... ..........146  
(b) Standard of review ............................................................................................................. .....146  
(c) Transparency................................................................................................................... ........146  
(d) Methodology.................................................................................................................... .......146  
(e) Fire blight.................................................................................................................... ............147  
(f) European canker ................................................................................................................ .....149  
(g) ALCM........................................................................................................................... ..........149  
(h) Article 5.6 .................................................................................................................... ...........149  
(i) The Panel's evaluation of the measures ..................................................................................150  
(j) Real world measures............................................................................................................ ...150  
(k) Conclusion ..................................................................................................................... .........150  
V. ARGUMENTS OF THE THIRD PARTIES ......................................................................151  WT/DS367/R 
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  A.
 CHILE ............................................................................................................................... .......151  
1. Chile's written submission ...................................................................................................15 1 
2. Chile's oral statement ......................................................................................................... ..152  
B. EUROPEAN COMMUNITIES ......................................................................................................153  
1. Executive summary of the European Communities' written submission ........................153  
(a) Introduction................................................................................................................... ..........153  
(b) Legal assessment............................................................................................................... ......153  
(i) Articles 2.2 and 5.1 of the SPS Agreement .............................................................................153  
(ii) Article 5.2 of the SPS Agreement............................................................................................154  
(iii) Articles 5.5 and 2.3 of the SPS Agreement .............................................................................154  
(iv) Article 5.6 of the SPS Agreement............................................................................................155  
(v) Article 8 and Annex C(1)(a) of the SPS Agreement ................................................................155  
(c) Conclusions.................................................................................................................... .........155  
2. Executive summary of the European Communities' oral statement................................156  
(a) Introduction................................................................................................................... ..........156  
(b) Australia's request for a ruling on New Zealand's claim of undue delay................................156  
(c) The role of amicus curiae  briefs .............................................................................................156  
(d) The use of experts in panel proceedings .................................................................................157  
(e) The Panel's standard of revi ew under the SPS Agreement .....................................................157  
(f) Conclusions.................................................................................................................... .........157  
C. JAPAN ............................................................................................................................... .......157  
1. Executive summary of Japan's written submission ...........................................................157  
(a) Introduction................................................................................................................... ..........157  
(b) Arguments...................................................................................................................... .........158  
(i) Consistency of the measures with Article 2.2 of the SPS Agreement......................................158  
(ii) Consistency of the measures with Article 5.1 of the SPS Agreement......................................158  
(iii) Consistency of the measures with Article 2.2 of the SPS Agreement......................................159  
(iv) Consistency of the measures with Article 5.5 of the SPS Agreement......................................159  
(c) Conclusion ..................................................................................................................... .........159  
2. Japan's oral statement......................................................................................................... .159 
(a) Determination of the appropriate level of protection in the SPS Agreement as a 
"prerogative" of a WTO Member ...........................................................................................160  
(b) Burden of proof................................................................................................................ .......160  
D. CHINESE TAIPEI .......................................................................................................................161  
1. Executive summary of Chinese Ta ipei's written submission ............................................161  
(a) Introduction................................................................................................................... ..........161   WT/DS367/R 
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  (b) Legal arguments................................................................................................................ ......161  
(i) Application of "necessity" test to  Australia's SPS measures...................................................161  
Substantive requirements of the "necess ity" test in the SPS  Agreement............................................... 161  
Australia's contested measures must satisfy the th ree-pronged test to establish their necessity............ 162  
(ii) Whether Australia's appropriate levels of protection between New Zealand apples 
and Japanese pears are comparable ......................................................................................162  
Determination of Appropriate Level of Protection in the SPS Agreement ........................................... 162  
Distinction between appropriate levels of protection can be made only in comparable 
situations ..................................................................................................................... .......................... 162  
(c) Conclusion ..................................................................................................................... .........163  
2. Chinese Taipei's or al statement...........................................................................................164  
E. UNITED STATES .......................................................................................................................164  
1. Executive summary of the United  States' written submission..........................................164  
(a) Introduction................................................................................................................... ..........164  
(b) The Panel should make an objective assessment of the matter before it pursuant to 
Article 11 of the DSU .......................................................................................................... ...164  
(c) Article 2.2 of the SPS Agreement requires sufficient scientific evidence ..............................164  
(d) Article 5.1 requires that SPS measures be based on a risk assessment...................................165  
(e) Arbitrary or unjustifiable distinctions in the level of protection under Article 5.5.................165  
(f) Article 5.6 requires that SPS measures not be more trade restrictive than necessary to 
meet a Member's appropriate  level of protection....................................................................166  
(g) Undue delay under Article  8 and Annex C.............................................................................166  
2. Executive summary of the United  States' oral statement..................................................166  
(a) Key issues in the US written submission................................................................................166  
(b) Standard of review for a risk assessment under Article 5.1....................................................167  
(c) The proper interpretati on of Article 5.2..................................................................................167  
(d) The "necessity" of a measure under Articles 2.2 and 5.6........................................................168  
(e) Undue delay under Article  8 and Annex C.............................................................................168  
(f) Conclusion ..................................................................................................................... .........168  
VI. INTERIM REVIEW.............................................................................................................168  
A. INTERIM REVIEW CHANGES TO DESCRIPTIVE PART...............................................................169  
1. Description of Panel proceedings ........................................................................................169  
2. Pests at issue ................................................................................................................. .........169  
3. Previous risk  assessment ......................................................................................................1 70 
B. INTERIM REVIEW CHANGES TO THE FINDINGS SECTION .........................................................170  
1. Experts' selection and consultation process........................................................................170  
2. Whether the measures identified by Ne w Zealand are challengeable under the 
SPS Agreement.................................................................................................................. ....172  WT/DS367/R 
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  3.
 New Zealand's claims under Articles 2.2, 5.1 and 5.2 of the SPS Agreement .................175  
(a) Order of analysis.............................................................................................................. .......175  
(b) Standard of review ............................................................................................................. .....176  
(c) Summary of the Parties' arguments under Ar ticles 5.1 and 5.2 of the SPS Agreement..........177  
(d) Requirements regarding fire blight .........................................................................................177  
(e) Requirements regarding European canker ..............................................................................184  
(f) Requirements regarding ALCM .............................................................................................187  
4. New Zealand's claim under Articl e 5.5 of the SPS Agreement.........................................190  
5. New Zealand's claim under Articl e 5.6 of the SPS Agreement.........................................192  
6. New Zealand's claims under Article under Article 8 and Annex C(1)(a) of the 
SPS Agreement.................................................................................................................. ....195  
C. MINOR CORRECTIONS AND ADDITION OF REFERENCES ..........................................................196  
VII. FINDINGS....................................................................................................................... ......197  
A. AUSTRALIA 'S CONCERNS WITH THE EXPERT SELECTION AND CONSULTATION PROCESS .......197  
1. Qualification of concerns expressed by Australia..............................................................198  
2. Selection of experts ........................................................................................................... ....199  
(a) The Panel's selection of only one ALCM expert ....................................................................199  
(b) The alleged connection of the ALCM expert with the complainant.......................................202  
3. Consultation of experts........................................................................................................ .206 
(a) Concerns expressed by Australia ............................................................................................206  
(b) Whether the Panel posed new questions to experts or modified questions from the 
draft provided to Parties and whether su ch new questions affect due process .......................207  
(c) Whether the Panel should be prevented fro m considering issues raised in Third 
Parties' submissions or additional info rmation provided by the experts.................................213  
(d) Whether the Panel should disregard opinions expressed by the scientific experts 
outside of the field of expertise for which they were selected................................................216  
4. General conclusion on Australia's con cerns regarding the process of selection 
and consultation of experts ..................................................................................................22 0 
B. WHETHER THE MEASURES IDENTIFIED BY NEW ZEALAND ARE CHALLENGEABLE 
UNDER THE SPS  AGREEMENT .................................................................................................220  
1. Summary of the Parties' arguments....................................................................................220  
2. The Panel's analysis ........................................................................................................... ...223  
(a) The purpose of the 16 measures..............................................................................................225  
(i) Subparagraph (a)............................................................................................................... .....227  
(ii) Subparagraph (d)............................................................................................................... .....230  
(b) The form and nature of the 16 measures.................................................................................231  
(c) Principal v. ancillary measures ...............................................................................................237  
C. NEW ZEALAND 'S CLAIMS UNDER ARTICLES 2.2, 5.1 AND 5.2 OF THE SPS A GREEMENT .......240   WT/DS367/R 
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  1. Order of analysis.............................................................................................................. .....240  
(a) Summary of the Parties' arguments.........................................................................................240  
(b) The Panel's analysis ........................................................................................................... .....245  
2. Standard of review............................................................................................................. ...248  
(a) Summary of the Parties' arguments.........................................................................................248  
(b) The Panel's analysis ........................................................................................................... .....250  
3. Summary of the Parties' arguments under Articles 5.1 and 5.2 of the 
SPS Agreement.................................................................................................................. ....252  
4. Requirements regarding fire blight.....................................................................................254  
(a) Alleged overestimation fo r importation step 1 .......................................................................257  
(i) Summary of the Parties' arguments ........................................................................................257  
(ii) The Panel's analysis........................................................................................................... .....258  
(b) Alleged overestimation fo r importation step 2 .......................................................................260  
(i) Summary of the Parties' arguments ........................................................................................260  
(ii) The Panel's analysis........................................................................................................... .....262  
(c) Alleged overestimation fo r importation step 3 .......................................................................264  
(i) Summary of the Parties' arguments ........................................................................................264  
(ii) The Panel's analysis........................................................................................................... .....265  
(d) Alleged overestimation fo r importation step 4 .......................................................................267  
(i) Summary of the Parties' arguments ........................................................................................267  
(ii) The Panel's analysis........................................................................................................... .....268  
(e) Alleged overestimation fo r importation step 5 .......................................................................270  
(i) Summary of the Parties' arguments ........................................................................................271  
(ii) The Panel's analysis........................................................................................................... .....271  
(f) Alleged overestimation fo r importation step 6 .......................................................................273  
(i) Summary of the Parties' arguments ........................................................................................273  
(ii) The Panel's analysis........................................................................................................... .....274  
(g) Alleged overestimation fo r importation step 7 .......................................................................275  
(i) Summary of the Parties' arguments ........................................................................................275  
(ii) The Panel's analysis........................................................................................................... .....276  
(h) Estimation for importation step 8 ...........................................................................................277  
(i) Summary of the Parties' arguments ........................................................................................277  
(ii) The Panel's analysis........................................................................................................... .....277  
(i) Alleged overestimation for the ove rall probability of importation .........................................278  
(i) Summary of the Parties' arguments ........................................................................................278  
(ii) The Panel's analysis........................................................................................................... .....278  WT/DS367/R 
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  (j)
 IRA's analysis of the probability of entry, establishment and spread of fire blight ................280  
(i) Summary of the Parties' arguments ........................................................................................280  
(ii) The Panel's analysis........................................................................................................... .....283  
Proximity...................................................................................................................... ......................... 284  
Exposure....................................................................................................................... ......................... 285  
Viab ility...................................................................................................................... ................... 285  
Survival....................................................................................................................... ................... 286  
Transfer mechanisms ............................................................................................................ ......... 287  
Inoculum dose.................................................................................................................. .............. 289  
Host rece ptivity............................................................................................................... ............... 290  
Environmenta l fact ors.......................................................................................................... .......... 292  
Conclusion on exposure......................................................................................................... ........ 292  
Establishment .................................................................................................................. ...................... 293  
Spread......................................................................................................................... ........................... 293  
Partial probability of es tablishment and spread................................................................................ ..... 294  
Conclusions regarding entry, establishment and spread........................................................................ 29 5 
(k) Potential biological and economic conse quences associated with fire blight.........................301  
(i) Summary of the Parties' arguments ........................................................................................301  
(ii) The Panel's analysis........................................................................................................... .....303  
(l) Overall conclusions with respect to th e requirements regarding fire blight ...........................306  
(m) Alleged methodological flaws id entified by New Zealand.....................................................306  
(i) Choice of maximum value for negligible events .....................................................................306  
Summary of the Pa rties' ar guments .............................................................................................. ......... 306  
The Panel's analys is........................................................................................................... .................... 307  
(ii) Use of uniform distribution to model the likelihood of events ................................................309  
Summary of the Pa rties' ar guments .............................................................................................. ......... 309  
The Panel's analys is........................................................................................................... .................... 310  
(iii) Overestimation of the projected volume  of trade in New Zealand apples ..............................311  
Summary of the Pa rties' ar guments .............................................................................................. ......... 311  
The Panel's analys is........................................................................................................... .................... 313  
(iv) Conclusion regarding the methodological flaws identified by New Zealand .........................314  
5. Requirements regarding European canker ........................................................................315  
(a) Estimation for importation step 1 ...........................................................................................317  
(i) Summary of the Parties' arguments ........................................................................................317  
(ii) The Panel's analysis........................................................................................................... .....317  
(b) Alleged overestimation fo r importation step 2 .......................................................................318  
(i) Summary of the Parties' arguments ........................................................................................318   WT/DS367/R 
 Page xiii 
 
 
  (ii) The Panel's analysis........................................................................................................... .....319  
(c) Alleged overestimation fo r importation step 3 .......................................................................325  
(i) Summary of the Parties' arguments ........................................................................................325  
(ii) The Panel's analysis........................................................................................................... .....326  
(d) Alleged overestimation fo r importation step 4 .......................................................................331  
(i) Summary of the arguments of the Parties ...............................................................................331  
(ii) Analysis of the Panel.......................................................................................................... .....333  
(e) Alleged overestimation fo r importation step 5 .......................................................................336  
(i) Summary of the Parties' arguments ........................................................................................336  
(ii) The Panel's analysis........................................................................................................... .....337  
(f) Alleged overestimation fo r importation step 6 .......................................................................338  
(i) Summary of the Parties' arguments ........................................................................................338  
(ii) The Panel's analysis........................................................................................................... .....339  
(g) Alleged overestimation fo r importation step 7 .......................................................................341  
(i) Summary of the Parties' arguments ........................................................................................341  
(ii) The Panel's analysis........................................................................................................... .....341  
(h) Estimation for importation step 8 ...........................................................................................342  
(i) Summary of the Parties' arguments ........................................................................................342  
(ii) The Panel's analysis........................................................................................................... .....343  
(i) Alleged overestimation for the ove rall probability of importation .........................................343  
(i) Summary of the Parties' arguments ........................................................................................343  
(ii) Analysis of the Panel.......................................................................................................... .....344  
(j) IRA's analysis of the probability of entry, establishment and spread .....................................346  
(i) Summary of the Parties' arguments ........................................................................................346  
(ii) The Panel's analysis........................................................................................................... .....350  
Proximity...................................................................................................................... ......................... 351  
Exposure....................................................................................................................... ......................... 351  
Waste di sposal ................................................................................................................. .............. 352  
Location of fungi .............................................................................................................. ............. 352  
Survival and viability of the fu ngus in or on the fruit.................................................................... 353  
Transfer mechanism............................................................................................................. .......... 355  
Availability of entry points................................................................................................... ......... 358  
Inoculum dose.................................................................................................................. .............. 358  
Host plant recep tivity ......................................................................................................... ............ 359  
Environmenta l fact ors.......................................................................................................... .......... 360  
Features specific to differe nt exposure groups .............................................................................. 361  
Conclusion on exposure......................................................................................................... ........ 361  WT/DS367/R 
Page xiv  
 
  Establishment .................................................................................................................. ...................... 362  
Spread......................................................................................................................... ........................... 363  
Partial probability of es tablishment and spread................................................................................ ..... 365  
Conclusions regarding exposure, establishment an d spread.................................................................. 365  
(k) Potential biological and economic conseque nces associated with European canker..............371  
(i) Summary of the Parties' arguments ........................................................................................371  
(ii) The Panel's analysis........................................................................................................... .....374  
(l) Overall conclusions with respect to the requirements regarding European canker ................379  
(m) Methodological flaws identified by New Zealand..................................................................379  
6. Requirements regarding ALCM .........................................................................................379  
(a) Available data on viability of ALCM cocoons .......................................................................381  
(i) Summary of the Parties' arguments ........................................................................................381  
(ii) The Panel's analysis........................................................................................................... .....383  
(b) Effect of parasitism on viability of ALCM inside occupied cocoons.....................................386  
(i) Summary of the Parties' arguments ........................................................................................386  
(ii) The Panel's analysis........................................................................................................... .....387  
(c) Flight range for ALCM.......................................................................................................... .387 
(i) Summary of the Parties' arguments ........................................................................................387  
(ii) Analysis of the Panel.......................................................................................................... .....389  
(d) Period of emergence ............................................................................................................ ...391  
(i) Summary of the Parties' arguments ........................................................................................391  
(ii) Analysis of the Panel.......................................................................................................... .....392  
(e) Climatic conditions for spread of ALCM in Australia ...........................................................394  
(i) Summary of the Parties' arguments ........................................................................................394  
(ii) The Panel's analysis........................................................................................................... .....395  
(f) Mode of trade.................................................................................................................. ........397  
(i) Summary of the Parties' arguments ........................................................................................397  
(ii) The Panel's analysis........................................................................................................... .....398  
(g) Conclusions regarding the IRA's estimation for the likelihood of entry, establishment 
and spread of ALCM ............................................................................................................. .399 
(h) Potential biological and economic c onsequences associated with ALCM .............................400  
(i) Summary of the Parties' arguments ........................................................................................400  
(ii) The Panel's analysis........................................................................................................... .....402  
(i) Overall conclusions with respect to requirements regarding ALCM......................................403  
7. General me asures............................................................................................................... ...404  
(i) Summary of the Parties' arguments ........................................................................................404   WT/DS367/R 
 Page xv 
 
 
  (ii) The Panel's analysis........................................................................................................... .....406  
8. General conclusion on New Zealand's cl aims under Articles 5.1, 5.2 and 2.2 of 
the SPS Agreement .............................................................................................................. .408 
D. NEW ZEALAND 'S CLAIM UNDER ARTICLE  5.5 OF THE SPS  AGREEMENT ................................408  
1. Introduction................................................................................................................... ........408  
2. Threshold issue raised by Australia ....................................................................................410  
3. The three elements of Article 5.5 .........................................................................................417  
(a) The first element of Article 5.5............................................................................................... 417 
(i) Different but comparable situations .......................................................................................417  
Comparability of fire blight (Erwinia amylovora) and Japa nese Erwinia ............................................. 419  
Comparability of European canker (Neonectria galligena) and brown rot (Monilinia 
fructigena) .................................................................................................................... ......................... 421  
(ii) The ALOPs in the different situations.....................................................................................422  
(b) The second element of Article 5.5 ..........................................................................................427  
(i) Comparison of the risks of European can ker in New Zealand apples and of brown rot 
in Japanese nashi pears........................................................................................................ ..429  
Facility of tr ansmission ....................................................................................................... .................. 430  
Potential biological an d economic consequences................................................................................. .4 3 0 
Range of ho st plants ........................................................................................................... ................... 431  
Presence of the two pe sts in ex port areas ...................................................................................... ........ 431  
Presence of the two pests in Australia......................................................................................... .......... 435  
Volumes of trade ............................................................................................................... .................... 436  
Existing controls  in Australia ................................................................................................. ............... 439  
Overall consideration of th e various risk  factors.............................................................................. ..... 439  
(ii) Comparison of the risks of fire blight in New Zealand apples and of 
Japanese Erwinia in Japa nese nashi pears ............................................................................441  
Presence of the two pe sts in ex port areas ...................................................................................... ........ 442  
Presence of the two pests in Australia......................................................................................... .......... 447  
Potential biological and economic cons equences (range of host plants)............................................... 448  
Overall consideration of th e various risk  factors.............................................................................. ..... 449  
4. The Panel's conclusion on New Zealand's Article 5.5 Claim ............................................450  
E. NEW ZEALAND 'S CLAIM UNDER ARTICLE  2.3 OF THE SPS A GREEMENT ...............................450  
F. NEW ZEALAND 'S CLAIM UNDER ARTICLE  5.6 OF THE SPS  AGREEMENT ................................451  
1. The Panel's approach to assessing New Zealand's claim ..................................................451  
(a) Three cumulative conditions of  the Article 5.6 test ................................................................451  
(b) The Panel's order of analysis of the th ree conditions of the Article 5.6 test ...........................452  
2. Measures at issue regarding fire blight and European canker.........................................453  WT/DS367/R 
Page xvi  
 
  (a)
 Alternative measure regarding fire blig ht and European canker identified by 
New Zealand .................................................................................................................... .......453  
(b) Whether restricting imports to mature, symptomless apples satisfies the three-pronged 
Article 5.6 test............................................................................................................... ..........457  
(i) Second condition:  whether restricting imports to mature, symptomless apples 
achieves Australia's ALOP in regard to fire blight and European canker .............................457  
Summary of the Pa rties' ar guments .............................................................................................. ......... 457  
The Panel's analys is........................................................................................................... .................... 460  
The Panel's approach to the second condition of the Artic le 5.6 test............................................. 460  
Analysis of the second co ndition of the Article 5.6 te st for fire blight .......................................... 463  
Analysis of the second cond ition of the Article 5.6 test  for European  canker ............................... 479  
(ii) First condition:  whether restricting imports to mature, symptomless apples is 
reasonably available taking into accoun t technical and economic feasibility........................494  
(iii) Third condition:  whether restricting imports to mature, symptomless apples is 
significantly less trade restrictive than Australia's current fire blight and European canker me asures ................................................................................................................ .....496
 
(c) Conclusion on New Zealand's Article 5.6 cl aim with regard to fire blight and 
European canker ................................................................................................................ .....497  
3. Measure regarding ALCM...................................................................................................498  
(a) Alternative measure regarding ALCM  identified by New Zealand........................................498  
(b) Whether inspection of a 600-fruit sample from each import lot satisfies the 
three-pronged Article 5.6 test ................................................................................................. 502 
(i) Second condition:  whether the inspection of a 600-fruit sample from each import lot 
achieves Australia's ALOP in regard to ALCM......................................................................502  
Summary of the Pa rties' ar guments .............................................................................................. ......... 502  
The Panel's analys is........................................................................................................... .................... 506  
(ii) First condition:  whether the inspection of a 600-fruit sample from each import lot is 
reasonably available taking into accoun t technical and economic feasibility........................514  
(c) Third condition:  whether the inspection of a 600-unit sample from each import lot is 
significantly less trade restrictive than Au stralia's current ALCM requirements ...................515  
(i) Summary of the Parties' arguments ........................................................................................515  
(ii) The Panel's analysis........................................................................................................... .....518  
(d) Conclusion on New Zealand's Article 5.6 claim in regard to ALCM.....................................520  
4. General me asures............................................................................................................... ...521  
(a) Alternative measure identified by New Zealand for the general measures.............................521  
(b) Whether an audit by AQIS of a sample of: (i) the relevant systems designed to ensure 
that apples are mature and symptomless, and (ii) the procedures for inspection of a 
600-unit sample satisfies the three- pronged Article 5.6 test...................................................523  
(i) Summary of the Parties' arguments ........................................................................................523  
(ii) The Panel's analysis........................................................................................................... .....526   WT/DS367/R 
 Page xvii 
 
 
  (c) Conclusion on New Zealand's Article 5.6 clai m in regard to the general measures...............528  
5. The Panel's conclusions on New Zealand's Article 5.6 Claim...........................................528  
(a) The Panel's conclusions under Article 5.6 ..............................................................................528  
(b) New Zealand's arguments linking its Article 5.6 claim to Article 2.2 of the 
SPS Agreement .................................................................................................................. .....529  
G. NEW ZEALAND 'S CLAIMS UNDER ARTICLE  8 AND ANNEX  C(1)( A) OF THE 
SPS A GREEMENT ....................................................................................................................530  
1. Summary of the Parties' arguments....................................................................................530  
(a) Parties' arguments on the subs tance of Annex C(1)(a) ...........................................................530  
(b) Parties' arguments on whether New Zealand's claims are within the Panel's terms of 
reference...................................................................................................................... ............531  
(i) Parties' arguments leading to Austra lia's second preliminary ruling request........................531  
(ii) The Parties' further arguments ...............................................................................................53 3 
New Zealand .................................................................................................................... ..................... 533  
Australia ...................................................................................................................... .......................... 535  
2. The Panel's analysis ........................................................................................................... ...537  
VIII.  CONCLUSIONS AND RECOMMENDATION ................................................................547  
ANNEXES 
 WT/DS367/R 
Page xviii  
 
  LIST OF ANNEXES 
 
ANNEX A 
 
CONTENTS Page 
Annex A-1 Request for the Establis hment of a Panel (WT/DS367/5) A-2 
Annex A-2 Communication from the Chairman of the Panel:  Preliminary Ruling 
by the Panel (WT/DS367/7) A-5 
Annex A-3 Working Procedures for the Panel, adopted on 26 March 2008 A-9 
Annex A-4 Procedures for the Panel's fi rst substantive meeting, adopted on 
4 August 2008 A-13 
Annex A-5 Procedures for the Panel's meeti ng with the experts and Parties and the 
Panel's second substantive m eeting, adopted on 11 June 2009 A-17 
 
 
ANNEX B* 
 
CONTENTS Page 
Annex B-1 List of replies from the scientific experts to questions posed by the 
Panel B-2 
Annex B-2 Transcript of the Panel's m eeting with the scientific experts B-2 
 
 
                                                      
* The Replies from the scientific experts to questions posed by the Panel  (Annex B-1) and the 
Transcript of the proceedings of the Panel's meeting with the experts  (Annex B-2) are part of this report.  In 
accordance with the Pro cedures for the Panel's meeting with the experts and Parties and the Panel's second 
substantive meeting, adopted on 11 June 2009 (Annex A-5), the Replies from the scientific experts to questions posed by the Panel and the Transcript of the proceeding s of the Panel's meeting with  the experts will only be 
available in electronic format.  WT/DS367/R 
 Page xix 
 
 
  TABLE OF CASES CITED IN THIS REPORT 
 
Short Title Full Case Title and Citation 
Argentina – Footwear (EC) Appellate Body Report, Argentina – Safeguard Measures on Imports of 
Footwear , WT/DS121/AB/R, adopted 12 January 2000, DSR 2000:I, 515 
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 – Aircraft   Appellate Body Report, Brazil – Export Financing Programme for Aircraft , 
WT/DS46/AB/R, adopted 20 August 1999, DSR 1999:III, 1161 
Canada – Continued 
Suspension Appellate Body Report, Canada – Continued Suspension of Obligations in the 
EC – Hormones Dispute , WT/DS321/AB/R, adopted 14 November 2008 
Canada – Continued 
Suspension Panel Report, Canada – Continued Suspension of Obligations in the EC – 
Hormones Dispute , WT/DS321/R, adopted 14 November 2008, as modified by 
Appellate Body Report WT/DS321/AB/R 
Chile – Price Band System   Appellate Body Report, Chile – Price Band System and Safeguard Measures 
Relating to Certain Agricultural Products , WT/DS207/AB/R, adopted 23 October 
2002, DSR 2002:VIII, 3045 (Corr.1, DSR 2006:XII, 5473) 
Dominican Republic – Import 
and Sale of Cigarettes Appellate Body Report, Dominican Republic – Measures Affecting the 
Importation and Internal Sale of Cigarettes , WT/DS302/AB/R, adopted 19 May 
2005, DSR 2005:XV, 7367 
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 – 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 – Chicken Cuts Appellate Body Report, European  Communities – Customs Classification of 
Frozen Boneless Chicken Cuts , WT/DS269/AB/R, WT/DS286/AB/R, adopted 
27 September 2005, and Corr.1, DSR 2005:XIX, 9157 
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 – Hormones (Canada)   Panel Report, EC Measures Concerning Meat and Meat Products (Hormones), 
Complaint by Canada , WT/DS48/R/CAN, adopted 13 February 1998, as 
modified by Appellate Body Report WT/DS26/AB/R, WT/DS48/AB/R, 
DSR 1998:II, 235 
EC – Hormones (US)   Panel Report, EC Measures Concerning Meat and Meat Products (Hormones), 
Complaint by the United States , WT/DS26/R/USA, adopted 13 February 1998, as 
modified by Appellate Body Report WT/DS26/AB/R, WT/DS48/AB/R, 
DSR 1998:III, 699 
EC – Selected Customs Matters Appellate Body Report, European Communities – Selected Customs Matters , 
WT/DS315/AB/R, adopted 11 December 2006, DSR 2006:IX, 3791 WT/DS367/R 
Page xx  
 
  Short Title Full Case Title and Citation 
EC – Selected Customs Matters Panel Report, European Communities – Selected Customs Matters , WT/DS315/R, 
adopted 11 December 2006, as modified by Appellate Body Report WT/DS315/AB/R, DSR 2006:IX-X, 3915 
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 
India – Patents (US)   Appellate Body Report, India – Patent Protection for Pharmaceutical and 
Agricultural Chemical Products , WT/DS50/AB/R, adopted 16 January 1998, 
DSR 1998:I, 9 
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 – Agricultural 
Products II Panel Report, Japan – Measures Affecting Agricultural Products , WT/DS76/R, 
adopted 19 March 1999, as modified by Appellate Body Report 
WT/DS76/AB/R, DSR 1999:I, 315 
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 Panel Report, Japan – Measures Affecting the Importation of Apples , 
WT/DS245/R, adopted 10 December 2003, upheld by Appellate Body Report 
WT/DS245/AB/R, DSR 2003:IX, 4481 
Japan – Apples (Article 21.5 – US) Panel Report, Japan – Measures Affecting the Importation of Apples – Recourse 
to Article 21.5 of the DSU by the United States , WT/DS245/RW, adopted 
20 July 2005, DSR 2005:XVI, 7911 
Japan – DRAMs (Korea) Panel Report, Japan – Counterva iling Duties on Dynam ic Random Access 
Memories from Korea , WT/DS336/R, adopted 17 D ecember 2007, as modified 
by Appellate Body Report WT/DS336/AB/R, DSR 2007:VII, 2805 
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 
Thailand – H-Beams   Appellate Body Report, Thailand – Anti-Dumping Duties on Angles, Shapes and 
Sections of Iron or Non-Alloy Steel and H-Beams from Poland , 
WT/DS122/AB/R, adopted 5 April 2001, DSR 2001:VII, 2701 
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 – Certain EC Products   Appellate Body Report, United States – Import Measures on Certain Products 
from the European Communities , WT/DS165/AB/R, adopted 10 January 2001, 
DSR 2001:I, 373  WT/DS367/R 
 Page xxi 
 
 
  Short Title Full Case Title and Citation 
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 
US – Continued Suspension Panel Report, United States – Continued Suspension of Obligations in the EC – 
Hormones Dispute , WT/DS320/R, adopted 14 November 2008, as modified by 
Appellate Body Report WT/DS320/AB/R 
US – Corrosion-Resistant 
Steel Sunset Review  Appellate Body Report, United States – Sunset Review 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 – Countervailing Duty 
Investigation on DRAMS Appellate Body Report, United States – Countervailing Duty Investigation on 
Dynamic Random Access Memory Semiconductors (DRAMS) from Korea , 
WT/DS296/AB/R, adopted 20 July 2005, DSR 2005:XVI, 8131 
US – Export Restraints  Panel Report, United States – Measures Treating Exports Restraints as 
Subsidies , WT/DS194/R and Corr.2, adopted 23 August 2001, DSR 2001:XI, 
5767 
US – Gambling Appellate Body Report, United States – Measures Affecting the Cross-Border 
Supply of Gambling and Betting Services , WT/DS285/AB/R, adopted 20 April 
2005, DSR 2005:XII, 5663 (Corr.1, DSR 2006:XII, 5475) 
US – Gambling Panel Report, United States – Measures Affecting the Cross-Border Supply of 
Gambling and Betting Services , WT/DS285/R, adopted 20 April 2005, as 
modified by Appellate Body Report WT/DS285/AB/R, DSR 2005:XII, 5797 
US – Gasoline   Appellate Body Report, United States – Standards for Reformulated and 
Conventional Gasoline , WT/DS2/AB/R, adopted 20 May 1996, DSR 1996:I, 3 
US – Lamb Appellate Body Report, United States – Safeguard Measures on Imports of 
Fresh, Chilled or Frozen Lamb Meat from New Zealand and Australia , 
WT/DS177/AB/R, WT/DS178/AB/R, adopted 16 May 2001, DSR 2001:IX, 
4051 
US – Oil Country Tubular 
Goods Sunset Reviews Appellate Body Report, United States – Sunset Reviews of Anti-Dumping 
Measures on Oil Country Tubular Goods from Argentina , WT/DS268/AB/R, 
adopted 17 December 2004, DSR 2004:VII, 3257 
US – Shrimp  Appellate Body Report, United States – Import Prohibition of Certain Shrimp and 
Shrimp Products , WT/DS58/AB/R, adopted 6 November 1998, DSR 1998:VII, 
2755 
US – Softwood Lumber VI 
(Article 21.5 – Canada) Appellate Body Report, United States – Investigation of the International Trade 
Commission in Softwood Lumber from Canada – Recourse to Article 21.5 of the 
DSU by Canada , WT/DS277/AB/RW, adopted 9 May 2006, and Corr.1, DSR 
2006:XI, 4865 
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 – 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/R 
Page xxii  
 
  LIST OF ABBREVIATIONS USED IN THIS REPORT 
 
ABARE Australian Bureau of Ag ricultural and Resource Economics 
(Australia) 
ABS Australian Bureau of Statistics (Australia) 
AHL n-acyl homoserine lactone 
ALCM Apple leafcurling midge ALOP Appropriate level of protection ALPP Area of low pest prevalence APAL Apple & Pear Industry Ltd (Australia) 
AQIS Australian Quarantine and Inspection Service (Australia) 
BA Biosecurity Australia (Australia) BRS Bureau of Rural Sciences (Australia) CABI CAB (Commonwealth Agricultural Bureau) International 
(United Kingdom) 
cfu Colony-forming unit 
CICD Council for International Congresses of Dipterology CSIRO Commonwealth Scientific and Industrial Research Organisation 
(Australia) 
D. mali Dasineura mali 
DAFF Department of Agriculture, Fisheries and Forestry (Australia) DEA Designated export area 
DOI Declaration of intent DSB Dispute Settlement Body DSU Dispute Settlement Understanding 
E. amylovora Erwinia amylovora 
EA Erwinia amylovora   WT/DS367/R 
 Page xxiii 
 
 
  EC European Communities 
EPS exopolysaccharides ESG Eminent Scientists Group (Australia) Exp. Exposure FAO Food and Agriculture Organization of the United Nations 
GATT General Agreement on Tariffs and Trade 
GATT 1994 General Agreement on Tariffs and Trade 1994 HAL Horticulture Australia Limited (Australia) HortResearch Horticulture and Food Resear ch Institute of New Zealand Limited 
(New Zealand) 
IFP Integrated fruit production 
Imp Importation step IPPC International Plant Protection Convention IRA Final Import Risk Analysis Report for Apples from New Zealand , 
November 2006 
ISPM International Standards for Ph ytosanitary Measures (International 
Plant Protection Convention) 
MAFNZ Ministry of Agriculture and Forestry (New Zealand) 
N. galligena Neonectria galligena 
NG Neonectria galligena  
NPPO National plant protection organization  
OIE World Organisation for Animal Health 
PCR Polymerase chain reaction PFA Pest free area PFGE Pulsed-field gel electrophoresis PRA Pest risk analysis WT/DS367/R 
Page xxiv  
 
  PEES Probability of entry, establishment and spread 
PPE Partial probability of entry PPEES Partial probability of entry, establishment and spread PPES Partial probability of entry and spread PPS Partial probability of spread 
SOP Standard operating procedure 
SPS Sanitary and phytosanitary SPS Agreement WTO Agreement on the Appli cation of Sanitary and Phytosanitary 
Measures 
UK United Kingdom 
US United States of America 
USDA United States Department of Agriculture (United States) VBNC Viable, but not culturable WTO World Trade Organization WTO Agreement Marrakesh Agreement esta blishing the World Trade Organization 
 
    WT/DS367/R 
 Page 1 
 
 
 I. INTRODUCTION 
A. REQUEST FOR CONSULTATIONS  
1.1 On 31 August 2007, New Zealand requested consultations with Australia pursuant to 
Article XXII of the General Agre ement on Tariffs and Trade 1994 ("GATT 1994"), Article 4 of the 
Understanding on Rules and Procedures Govern ing the Settlement of Disputes ("DSU") and 
Article 11 of the Agreement on the Applicati on of Sanitary and Phytosanitary Measures 
("SPS Agreement"), concerning measures imposed by Australia on the importation of apples from 
New Zealand.1  Consultations were held in  Geneva on 4 October 2007, but did not lead to a resolution 
of the dispute.2 
B. ESTABLISHMENT AND COMPOSITION OF THE PANEL  
1.2 On 6 December 2007, New Zealand requested  the Dispute Settlement Body ("DSB") to 
establish a panel pursuant to Article 6 of the DSU, with standard terms of reference as set out in 
Article 7.1 of the DSU.3  At its meeting on 21 January 2008, th e DSB established a Panel, pursuant to 
the request of New Zealand, in accordance with Article 6 of the DSU (WT/DSB/M/245). 
1.3 The Panel's terms of reference are the following: 
"To examine, in the light of the relevant provisions of the covered agreements cited 
by New Zealand in document WT/DS367/5,  the matter referred to the DSB by 
New Zealand in that document, and to ma ke such findings as will assist the DSB in 
making the recommendations or in giving the rulings provided for in those agreements." 
1.4 On 3 March 2008, New Zealand requested the Di rector-General to determine the composition 
of the panel, pursuant to paragraph 7 of Article  8 of the DSU.  On 12 March 2008, the Director-
General composed the Panel as follows: 
 Chairman: Mr P.J.A. (Attie) Swart 
  Members: Mr William Ehlers 
   Ms Kirsten Hillman 
 1.5 Chile, the European Communities
4, Japan, Pakistan, Chinese Taipei and the United States 
reserved their rights to participate in the Panel proceedings as Third Parties. 
                                                      
1 Australia – Apples , Request for Consultations (WT/DS367/1), 4 September 2007. 
2 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A-1 to this repo rt.  Australia's first wr itten submission, para. 33. 
3 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A-1 to this report. 
4 On 1 December 2009, the Treaty of Lisbon amendi ng the Treaty on Europe an Union and the Treaty 
establishing the European Community (done at Lisbon, 13 December 2007) entered into force.  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 Eu ropean Union replaces and su cceeds the European Community. WT/DS367/R 
Page 2  
 
 C. P
ANEL PROCEEDINGS  
1. Adoption of the Working Procedures and the timetable 
1.6 On 14 March 2008, the Panel circulated two set s of draft working procedures and timetables 
to the Parties.5  In order to obtain the Parties' views, one version of the documents was prepared 
assuming that the Panel would consult scientific e xperts, while the other version was prepared 
assuming no such expert consultation.  The Panel held an organizational meeting on 19 March in 
order to consult the Parties on the proposed work ing procedures and timetables.  Both Parties 
expressed their views during the meeting;  the Pane l invited them to submit in writing and no later 
than by 20 March any additional comments, including  on the question of whether a full transcript of 
questions and answers should be included in the fina l report.  In response to the Panel's invitation, 
both Parties submitted written comments on a number of  organizational questions raised during the 
meeting;  New Zealand did so on 19 and 20 March6 and Australia on 20 March.7  On 26 March, the 
Panel notified the Parties of the adopted Working Procedures.8  The Panel sent a revised draft 
timetable to Parties on 4 April for their comments.9  On 8 April, the Panel notified the Parties of the 
adopted timetable.10  On the same date, Third Parties were notified of the Working Procedures and the 
timetable adopted by the Panel.11  Having noted the views expressed by the Parties, the Working 
Procedures and timetable adopted by the Panel provided for expert consultation. 
2. Request for a preliminary ruling raised by Australia 
1.7 On 13 March 2008, Australia raised a prel iminary procedural question concerning the 
consistency of New Zealand's request for the establishment of the Panel (WT/DS367/5) with 
Article 6.2 of the Dispute Settlement Understanding.12  In response to an invitation from the Panel13, 
on 17 March both Parties submitted preliminary reac tions to Australia's request for a preliminary 
procedural ruling, including on whether this requ est should affect the timing of the organizational 
meeting.14  After the organizational meeting, New Ze aland and Australia made written submissions 
regarding Australia's request for a preliminary procedural ruling on 7 and 14 April, respectively.15  
New Zealand submitted an additi onal unsolicited letter on the issue on 16 April in reference to 
Australia's submission of 14 April.16 
1.8 On 18 April 2008, the European Communities requ ested that, in the event the Panel intended 
to address Australia's request for a preliminary ruling prior to the date set in  the timetable for Third 
Party written submissions, the Panel should allow an  opportunity for Third Parties to separately 
comment on Australia's request.17  On 22 April, the Panel proposed a procedure and calendar to 
address the European Communities' request  and invited the Parties to comment.18  In their respective 
                                                      
5 Electronic communication from the Panel to the Parties, 14 March 2008. 
6 Electronic communications from New Zealand to the Panel, 19 and 20 March 2008. 
7 Communication from Australia to the Panel, 20 March 2008. 
8 Communication from the Panel to the Parties, 26 March 2008. 
9 Electronic communications from the Panel to the Parties, 3 and 4 April 2008. 
10 Communication from the Panel to the Parties, 8 April 2008. 
11 Electronic communication from the Panel to th e Parties and Third Pa rties, 8 April 2008. 
12 Communication from Australia to the Panel:  Request for a preliminary procedural ruling in relation 
to the consistency of New Zealand's panel request with Article 6.2 of the DSU, 13 March 2008. 
13 Electronic communication from the Panel to the Parties, 14 March 2008. 
14 Electronic communications from New Zealand and Australia to the Panel, 17 March 2008. 
15 Communications from New Zealand and Australia to the Panel, 7 and 14 April 2008, respectively. 
16 Communication from New Zealand to the Panel, 16 April 2008. 
17 Electronic communication from the European Communities to the Panel, 18 April 2008. 
18 Electronic communication from the Pane l to the Parties, 22 April 2008.  WT/DS367/R 
 Page 3 
 
 
 responses of 23 and 24 April, New Zealand and Au stralia expressed no objections to the Panel's 
proposal.19 
1.9 Noting the request made by the European Communities and the lack of objections from the 
Parties, the Panel invited Third Parties to prov ide comments on Australia's preliminary procedural 
request.20  Two Third Parties filed submissions:  the European Communities on 30 April 2008, 
followed by Chile on 2 May.21  On 9 May, New Zealand and Australia made comments on the Third 
Party submissions.22 
1.10 The Panel issued its preliminary ruling on th e procedural question raised by Australia on 
6 June 2008.23  After consultation with the Parties, the c ontent of the Panel's preliminary ruling was 
circulated by the Panel to the Dispute Settlement Body.24 
3. Revisions of the timetable 
1.11 In view of the time that had been granted for Third Parties to comment on the preliminary 
issue raised by Australia, and for Parties to comme nt on any Third Parties' comments, on 7 June 2008 
the Panel proposed extending the deadlines granted to  Parties to file their respective first written 
submissions and to Third Parties to file their Third Party submissions.25  After having heard the 
Parties' views on the matter26, on 13 June the Panel modified the timetable, extending by two working 
days the deadlines granted to Parties to file their fi rst written submissions and to Third Parties to file 
their own submissions;  the rest of the timetable was not modified.27 
1.12 On 15 July 2008, the United States requested a two-week extension for itself (and other Third 
Parties, if interested) to file their Third Party submission, because of the length and complexity of 
New Zealand's first written submission and the mini sterial meeting taking place in Geneva during the 
same week the Third Party submissions were due.28  In response to an invitation from the Panel29, 
New Zealand expressed a preference that no extensi on be granted for Third Party submissions or, 
alternatively, that any extension be no longer than one week.30  Australia supported extending the 
deadline by one week.31  Chinese Taipei supported the United States' request32;  Chile, the European 
Communities, Japan and Pakistan expressed no objection to the request.33  Having noted the views 
expressed by the Parties and Third Parties, on 18 Ju ly the Panel extended the deadline granted to 
                                                      
19 Electronic communications from New Zealand and Australia to the Panel, 23 and 24 April 2008, 
respectively. 
20 Electronic communication from the Panel to the Parties and Third Parties, 24 April 2008. 
21 Communications from the European Communities and Chile to the Panel, 30 April and 2 May 2008, 
respectively. 
22 Communications from New Zealand and Australia to the Panel, 9 May 2008. 
23 Communication from the Panel to the Parties, 7 June 2008. 
24 Australia – Apples , Communication from the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008. 
25 Communication from the Panel to the Parties, 7 June 2008. 
26 Communications from New Zealand to the Panel, 11 and 12 June 2008;  Communications from 
Australia to the Panel, 11 and 13 June 2008. 
27 Communication from the Panel to the Parties, 13 June 2008;  communication from the Panel to the 
Third Parties, 16 June 2008. 
28 Communication from the United States to the Panel, 15 July 2008. 
29 Electronic communication from the Panel to th e Parties and Third Parties, 15 July 2008. 
30 Communication from New Zealand to the Panel, 16 July 2008. 
31 Communication from Australia to the Panel, 16 July 2008. 
32 Electronic communication fr om Chinese Taipei to the Panel, 16 July 2008. 
33 Electronic communication from the European Communities to the Panel, 15 July 2008;  Electronic 
communications from Chile, Japan and Pakistan to the Panel, 16 July 2008. WT/DS367/R 
Page 4  
 
 Third Parties to file their written submissions by one week;  the rest of the timetable was not 
modified.
34 
1.13 On 19 September 2008, the Panel informed the DS B that, due to the nature and scope of the 
dispute, including the Panel's decision to seek sci entific and technical expert advice pursuant to 
Article 11 of the SPS Agreement and Article 13 of th e DSU, it would not be able to issue its report 
within six months from the date that the Panel had been composed.  The Panel also informed the DSB 
that it expected to issue its final report to the Parties by July 2009, as envisaged in the timetable 
adopted after consultations with the Parties.35 
4. First written submissions by the Parties and Third Party submissions 
1.14 New Zealand and Australia filed their first writte n submissions on 20 June and 18 July 2008, 
respectively.  In accordance w ith the Working Procedures adopted by the Panel, both Parties 
submitted an executive summary of their respect ive first written submissions.  The European 
Communities filed its Third Party submission on 31 July.  Chile, Japan, Chinese Taipei and the 
United States filed their own Third Party submis sions on 1 August.  The European Communities, 
Japan, Chinese Taipei and the United States submitted an executive summary of their respective Third 
Party submissions.36 
5. Second request for a preliminary ruling raised by Australia 
1.15 On 22 August 2008, Australia requested the Panel to issue a preliminary ruling that 
New Zealand's claim under Article 8 and Annex C( 1)(a) of the SPS Agreement in its first written 
submission, that the " process  for considering New Zealand's request for access for New Zealand 
apples to the Australian market" had been unduly dela yed, was outside the scope of this dispute.  
Australia asked the Panel to rule on this matter, pref erably during the course of the first oral hearing 
on 2-3 September, or as soon as possible thereafter.37  On 25 August, the Panel invited both Parties, as 
well as Third Parties, to express in their statements  during the course of the first substantive meeting 
to be held on 2-3 September, their views on the i ssue raised by Australia in its letter of 22 August.38  
On 26 August, New Zealand sent a letter to the Pane l, expressing its view that there was no reason for 
the Panel to make a preliminary ruling on the issue of New Zealand's undue delay claim.39 
1.16 On 8 September 2008, the Pane l notified the Parties that it would address New Zealand's 
claim regarding Article 8 and Annex C(1)(a) of the SPS Agreement in its final report, together with 
the other claims advanced by New Zealand, si nce it had found no good cause to issue a second 
preliminary ruling at that point.40 
                                                      
34 Electronic communication from the Panel to th e Parties and Third Parties, 18 July 2008. 
35 Communication from the Panel to the DSB, 19 September 2008.  See, Australia – Apples , 
Communication from the Chairman of the Panel (WT/DS367/8), 23 September 2008. 
36 Under paragraph 12 of the Panel's Working Procedures, Parties and Third Parties were asked to 
provide an executive su mmary of their respective submissions or stat ements.  Executive summaries were not to 
exceed ten pages in length in the case of those provided by Parties and thr ee pages for those provided by Third 
Parties.  No executive summaries were required for submis sions or statements shorter than ten pages for Parties 
and three pages for Third Parties. 
37 Communication from Australia to the Panel, 22 August 2008. 
38 Electronic communication from the Panel to the Parties and Third Parties, 25 August 2008. 
39 Communication from New Zealand to the Panel, 26 August 2008. 
40 Communication from the Panel to the Parties, 8 September 2008.  WT/DS367/R 
 Page 5 
 
 
 6. Unsolicited letter from an Australian private entity 
1.17 On 26 August 2008, the Panel received an unso licited letter from an Australian private entity 
(Apple and Pear Australia Ltd , APAL).41  On 27 August, the Panel invited both Parties, as well as 
Third Parties, to express their views on how the Panel should deal with this unsolicited 
communication in their statements during the course of the first substantive meeting to be held on 
2-3 September 2008.42  During the substantive meeting, the Parties expressed no objection to the 
Panel accepting the unsolicited letter.43  On 8 September, the Panel notified the Parties that it had 
decided to accept the unsolicited communication r eceived from APAL, and would inform that entity 
accordingly.  The Panel also told the Parties that it would include in  the list of written questions after 
the first substantive meeting an invitation for th e Parties to comment on the substance of that 
unsolicited communication.44  On 18 September, APAL was informed by the Panel that its 
communication had been accepted by the Panel, noting at the same time that this decision did not 
prejudge on the content of the communication.45 
7. Substantive meeting of the Panel with the Parties and the Third Parties 
1.18 During the organizational meeting held by  the Panel on 19 March 2008, both Parties 
expressed their wish that the Panel's substantive me etings with the Parties and the Third Parties be 
open to viewing by the public, preferably by means of closed-circuit television broadcast to a separate 
room.  On 9 July, New Zealand and Australia sen t a joint message to the Panel reiterating their 
preference for the public being allowed to view th e proceedings of the substantive meeting through 
closed-circuit television broadcast.46  Having noted the Parties' preference, on 10 July the Panel sent a 
message to the Parties asking for their views regard ing the possible format for the Panel's substantive 
meeting and for the registration process for interested persons.47  On 15 July, the Panel received a 
joint response from New Zealand and Australia  to the questions posed by the Panel.48  On 23 July, the 
Panel sent to the Parties a set of draft procedures fo r the first substantive meeting and the Third Party 
session.49  On 28 July, New Zealand expressed its accep tance of the proposed draft procedures.50  
Australia made observations on specific aspects of the draft procedures on 29 July.51  New Zealand 
commented on Australia's observations on 31 July52 and Australia commented on New Zealand's 
comments on 1 August.53  On 4 August, Parties and Third Pa rties were notified of the rules of 
procedure adopted by the Panel fo r the first substantive meeting.54 
1.19 The Panel held its first substantive meeting with the Parties on 2 and 3 September 2008.  
It met with the Third Parties on 3 September 2008.  At  the request of the Parties, these meetings were 
open for public viewing from a separate room via closed-circuit television broadcast.  
On 10 September, the Panel sent written questions to th e Parties and to the Third Parties.  On the same 
                                                      
41 Communication from Apple and Pear Australia Ltd  to the Panel, 26 August 2008. 
42 Electronic communication from the Panel to the Parties and Third Parties, 27 August 2008. 
43 This was subsequently confirmed in the Parties'  respective responses to a question posed by the 
Panel after the first substantive meeting.  See New Zealand's reply to Panel question 147 after the first 
substantive meeting, para. 307, and Australia's reply to Panel question 147 after the first substantive meeting. 
44 Communication from the Panel to the Parties, 8 September 2008. 
45 Communication from the Panel to Apple and Pear Australia Ltd , 18 September 2008. 
46 Electronic communication from New Zealand and Australia to  the Panel, 9 July 2008. 
47 Electronic communication from the Panel to the Parties, 10 July 2008. 
48 Electronic communication from New Zealand and Australia to the Panel, 15 July 2008. 
49 Electronic communication from the Panel to the Parties, 23 July 2008. 
50 Electronic communication from New Zeal and to the Panel, 28 July 2008. 
51 Electronic communication from Australia to the Panel, 29 July 2008. 
52 Electronic communication from New Zeal and to the Panel, 31 July 2008. 
53 Electronic communication from Australia to the Panel, 1 August 2008. 
54 Communications from the Panel to the Parties and Third Parties, 4 August 2008. WT/DS367/R 
Page 6  
 
 date, Australia sent a number of written questions to New Zealand and to the United States.  
On 23 September, the Panel received responses to  questions from New Zealand, Australia, the 
European Communities, Japan, Chin ese Taipei and the United States. 
8. Agreement regarding one of the measures identified by New Zealand 
1.20 On 19 December 2008, New Zealand and Australi a addressed a joint communication to the 
Panel indicating that they had reached an agreem ent regarding one of the measures identified by 
New Zealand in its Panel request, i.e., the requireme nt that an orchard/block 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 sy mptoms of European canker (listed as the twelfth 
bullet point in New Zealand's Panel request).  The Parties informed the Panel that, based on 
Australia's confirmation that it does not impose su ch a requirement, New Zealand would not pursue 
its claim in relation to this point.  The Parties fi nally noted that they inte nded to copy the joint 
communication to Third Parties and to make it publicly available.
55  On 2 February 2009, the Panel 
asked the Parties' confirmation on whether Third Pa rties had already received a copy of the agreement 
reached by New Zealand and Australia and whether th e agreement had been made publicly available.  
The Panel also offered to ask the Secretariat to  circulate the Parties' joint communication as a 
document in the WT/DS367 series, related to the dispute.56  On 4 February, Australia replied that it 
would be sending a copy of the 19 December joint co mmunication to Third Parties on that same date.  
Australia added that, while it had not made the jo int communication public yet, it intended to do so.57  
On 6 February, New Zealand informed the Pa nel that Australia, in consultation with 
New Zealand, had provided Third Parties with  a courtesy copy of the 19 December joint 
communication.  New Zealand also confirmed th at it had not yet made the joint communication 
publicly available, but it intended to publish it on the website of the Ministry of Foreign Affairs and 
Trade.58 
9. Expert consultation process 
(a) Selection of experts and preparation of questions 
1.21 During the organizational meeting held by  the Panel on 19 March 2008, New Zealand 
expressed its view that expert advice would be an  important assistance for the Panel in addressing the 
matter in this dispute.  Both Parties indicated that , if the Panel decided to consult experts, it should 
consult them on an individual basis, rather than as a single expert group.  Australia also expressed its 
preliminary view that the experts used by the panel in the Japan – Apples  dispute would not be 
acceptable. 
1.22 In response to an invitation by the Panel duri ng the first substantive meeting, both Parties 
submitted additional views on how the Panel should c onsult experts;  Australia submitted its views on 
4 September and New Zealand on 11 September 2008.  In its communication, Australia stated that 
due to the completely different biologies of the th ree pests at issue, the Panel should seek separate 
expert advice on fire blight, European canker and apple leafcurling midge and that, should the Panel 
consider it necessary, it could also consult risk analys is experts.  Australia indicated that there should 
be at least two experts for each of the three pests at issue, in order to ensure that a sufficiently diverse 
range of views was available to the Panel, and th at experts should confine their advice to subjects 
                                                      
55 Communication from New Zealand and Austra lia to the Panel, 19 December 2008. 
56 Electronic communication from the Panel to the Parties, 2 February 2009. 
57 Electronic communication from Australia to the Panel, 4 February 2009. 
58 Electronic communication from New Zealand to the Panel, 6 February 2009.  The letter was 
published at http://www.mfat.govt.nz/downloads/treaties-an d-international-law/pruning-letter.pdf, consulted on 
14 September 2009.  WT/DS367/R 
 Page 7 
 
 
 within their field of expertise.  Australia added th at it would be appropriate for the Panel to consult 
relevant international bodies on appropr iate experts.  Finally, Australia  confirmed its preliminary view 
that the experts used by the panel in Japan – Apples  would not be acceptable.59  In turn, New Zealand 
stated that, if the Panel thought that this woul d be useful, it would be supportive of the use 
of scientific experts in the specific areas of fire blight, European canker and apple leafcurling midge.  
New Zealand indicated that one expert, or no more th an two for each of the pests at issue, would be 
adequate, and that it agreed with Australia that experts should confin e their advice to their areas of 
expertise.  New Zealand added that the Internati onal Plant Protection Convention (IPPC) would be the 
logical international organization to approach fo r suggestions for names of experts.  Finally, 
New Zealand noted that it saw no basis for excluding from consideration the experts used by the panel 
in Japan – Apples .60 
1.23 In a communication dated 15 September 2008, th e Panel notified the Parties that, having 
considered the views expressed by the Parties, it ha d decided to seek expert advice in four fields:  
(a) Erwinia amylovora  (fire blight), including its potential spread through trade in apples and the 
phytosanitary measures to be applied to control its spread;  (b) Neonectria galligena  (European 
canker), including its potential spread through tr ade in apples, the climatic conditions for its 
establishment, and the phytosanitary measures to  be applied to control its spread;  (c) Dasineura mali  
(apple leafcurling midge), including its potential sp read through trade in apples and the phytosanitary 
measures to be applied to control its spread;  and,  (d) pest risk assessment, including the use of semi-
quantitative methodologies.61 
1.24 Pursuant to the Working Procedures adopted by the Panel and the views expressed by the 
Parties, on 15 September 2008 the Panel requested the IPPC Secretariat to recommend names of 
candidate experts in the relevant fields.62  On 23 September, the IPPC Secretariat provided a first list 
of ten expert names.63  The Panel subsequently contacted these experts to enquire about their 
availability and possible conflicts of interest.  Only four of the ten experts confirmed their interest and 
availability to participate in the proceedings.  In its communication of 23 September, the IPPC 
Secretariat indicated that, with more time to resear ch, it could provide add itional names of relevant 
experts.64  In light of the limited number of available e xperts from the initial list, the Panel allowed for 
a delay in order to receive additional expert name s from the IPPC.  The IPPC submitted a second list 
of 12 expert names on 29 and 30 October.65  The Panel contacted the new suggested experts, and four 
of them confirmed their interest and availability to participate in the proceedings, while the other 
suggested experts declined due to potential conflicts of  interest, lack of directly relevant expertise or 
other commitments. 
1.25 On 13 November 2008, the Panel sent a set of doc uments to the Parties detailing the names, 
nationalities, curricula vitae  and preliminary conflict of interest statements of the eight available 
experts.66  The document package also contained the co mplete list of 22 experts who, until then, had 
been contacted by the Panel.  The Parties were  given the opportunity to comment on each available 
expert and to provide any compelling objections to any particular expert be ing chosen to provide 
advice to the Panel in this dispute.  Since, at th at point in the selection process, none of the experts 
                                                      
59 Communication from Australia to the Panel, 4 September 2008. 
60 Electronic communication from New Zealand to the Panel, 11 September 2008. 
61 Electronic communication from the Panel to the Parties, 15 September 2008. 
62 Communication from the Panel to the IPPC, 15 September 2008. 
63 Electronic communication from the IPPC to the Panel, 23 September 2008. 
64 Ibid. 
65 Electronic communications from the IPPC to the Panel, 29 and 30 October 2008. 
66 Communication from the Panel to the Parties, 13 November 2008.  This group of eight available 
experts included four of the experts that were ultimatel y selected by the Panel:  Dr Tom Deckers, Dr Bernardo 
Latorre, Dr Jean-Pierre Pau lin and Dr Gritta Schrader. WT/DS367/R 
Page 8  
 
 suggested by the IPPC with expertise on ALCM ha d confirmed their availability, the Panel solicited 
names of potential experts in this area from the Parties.
67 
1.26 In a letter dated 20 November 2008 New Zeal and provided comments on the list of eight 
available experts and expressed its objections to the appointment of two of the proposed experts.68  
New Zealand reiterated that it saw no basis for Austra lia's objection to experts consulted by the panel 
on Japan – Apples .  New Zealand also identified one potentia l ALCM expert, as well as an additional 
expert in European canker.69  On the same date, Australia noted  that it had compelling objections to 
the appointment of three of the proposed experts.70  Australia added that it was unable to suggest any 
ALCM experts at that stage, because it had not been  able to identify experts who were not citizens of 
New Zealand or who did not, in Australia's opinion , have close connections with the New Zealand 
government and industry.  Australia suggested that  the Panel contact the Council for International 
Congresses of Dipterology (CICD), which might be able to provide names of ALCM experts.  Australia stated that, given the disagreemen t between the Parties on the semi-quantitative 
methodology used in the IRA, it was essential that at least one of the risk assessment experts 
appointed by the Panel should have expertise in the use of semi-quantitative methodologies and that 
none of the proposed experts appeared to have such an  expertise.  Australia finally noted that, in the 
interest of minimizing any further delays in the dispute settlement process, the Panel could ask the 
Parties to suggest the names of additional possible experts.
71 
1.27 In light of the Parties' comments and sugges tions, as well as the limited number of available 
experts, on 21 November 2008 the Panel invited the Par ties to suggest experts in all of the four areas 
that had been identified, and particularly in the areas of European canker and pest risk assessment.  
The Panel informed the Parties that it would contact  the two experts suggested by New Zealand and, 
as suggested by Australia, it would also contact the CICD for names of experts in the area of 
ALCM.72 
1.28 Following Australia's recommendation, the Panel se nt a letter to the Chairman of the CICD 
on 25 November 2008 seeking assistance in identifying the names and contact details of scientific 
and/or technical experts suitably qualified to provide advice to the Panel on ALCM.73  O n  
26 November 2008, the Chairman of the CICD informed  the Panel of one potential expert in the field 
of ALCM.  The Chairman of the CICD also noted th at this ALCM scientist would be able to suggest 
names of additional experts on behalf of the CICD.74  After having been contacted by the Panel, the 
ALCM expert suggested by the CICD replied that  he would be unable to attend the Panel meeting 
with experts, but identified two experts in Dasineura mali  taxonomy and biology. 
1.29 In a letter dated 27 November 2008, and in res ponse to the Panel's invitation, New Zealand 
rejected the objections made by Australia on 20 November to one of the experts proposed by the 
Panel;  in this respect, New Zealand stated that past participation as an expert in a WTO dispute 
should not of itself create a conflict of interest.75  New Zealand also suggested the names of two 
possible experts in the area of European canker, as well as one on ALCM and one on pest risk 
                                                      
67 Communication from the Panel to the Parties, 13 November 2008. 
68 Communication from New Zealand to the Panel, 20 November 2008.  New Zealand's objections did 
not refer to any of the experts that were ultimately selected by the Panel. 
69 Communication from New Zealand to  the Panel, 20 November 2008. 
70 Communication from Australia to the Panel, 20 November 2008.  Australia's objections did not refer 
to any of the experts that were ultimately selected by the Panel. 
71 Communication from Australia to the Panel, 20 November 2008. 
72 Communication from the Panel to the Parties, 21 November 2008. 
73 Communication from the Panel to the CICD, 25 November 2008. 
74 Electronic communications from the CICD to the Panel, 26 November 2008. 
75 This expert was ultimately not selected by the Panel.  WT/DS367/R 
 Page 9 
 
 
 assessment.76  New Zealand finally stated that there w as nothing in the Panel's Working Procedures, 
nor in the guidance by the Appellate  Body in prior cases, that would require the Panel to appoint more 
than one expert for each of the different areas.77  On the same date, Australia suggested the names of 
two possible experts in the area of Europ ean canker and two on pest risk assessment.78  It also 
reiterated its objections to the appointme nt of one of the proposed experts.79 
1.30 On 5 December 2008, the Panel sent a second set of documents to the Parties (supplementing 
the one sent on 13 November) detailing the names, nationalities, curricula vitae  and preliminary 
conflict of interest statements of four additional av ailable experts;  this br ought the list of available 
experts to a total of twelve.  This second package also contained the complete list of the 34 experts 
who had been suggested thus far by the IPPC, th e CICD, Australia or New Zealand.  The Panel 
invited Parties to comment on the new available experts.80  On 9 December, the Panel sent a third set 
of documents to the Parties regarding three additiona l available experts that had been suggested by the 
Parties on 27 November;  this brought the list of available experts to a total of fifteen.81 
1.31 On 9 December 2008, New Zealand expressed comp elling objections to two of the suggested 
experts on ALCM.82  New Zealand added that, in its view, in light of the extremely limited pool of 
experts on ALCM, one expert would be sufficient.83  On the same date, Australia expressed 
compelling objections to two of the suggested experts on ALCM84, expressed its objection to a third 
expert on ALCM if he could not participate in a m eeting with the Panel, and ratified the objections it 
had raised earlier to another expert in fire blight and pest risk assessment.85  Australia reiterated its 
view that the experts used by the panel in the Japan – Apples  dispute would not be acceptable.86 
1.32 On 11 December 2008, the Panel received add itional comments from both Parties relating to 
the available experts.  New Zealand reiterated its  objection to one of the suggested experts on 
ALCM.87  New Zealand also responded to some of the objections made by Australia.  In 
New Zealand's view, Australia's objection to one of  the suggested experts on ALCM because he had 
collaborated in ALCM research with Ne w Zealand experts, was without basis.88  New Zealand also 
rejected the objection raised by Australia to one of  the suggested experts on fire blight because he had 
participated as an expert in the Japan – Apples  dispute.89  In turn, Australia argued that two of the 
proposed experts for European canker were generalist plant pathologists and should only be appointed 
if a specialist European canke r expert was also appointed.90  Australia also raised compelling 
                                                      
76 None of these four experts was ultimately selected by the Panel. 
77 Communication from New Zealand to  the Panel, 27 November 2008. 
78 Communication from Australia to the Panel, 27 November 2008.  Two of these experts (Dr Ricardo 
Sgrillo and Dr Terence Swinburne) were  ultimately selected by the Panel. 
79 Ibid.  This expert was ultimately not selected by the Panel. 
80 Communication from the Panel to  the Parties, 5 December 2008. 
81 Electronic communication fr om the Panel to the Parties, 9 December 2008. 
82 None of these experts was ultimately selected by the Panel. 
83 Communication from New Zealand to  the Panel, 9 December 2008. 
84 Communication from Australia to the Panel, 9 December 2008.  Australia's objections included 
Dr Jerry Cross, one of the experts who was ultimately selected by the Panel.  Australia noted that Dr Cross had 
recently participated in joint rese arch projects and publications w ith researchers fro m HortResearch 
New Zealand, an organization that was funded by the New Zealand Government. 
85 Ibid.  This expert on fire blight and pest risk assessment was ultimately not selected by the Panel. 
86 Ibid. 
87 Communication from New Zealand to the Panel, 11 December 2008.  This expert on ALCM was 
ultimately not selected by the Panel. 
88 This expert, Dr Jerry Cross, is one of the ex perts who was ultimately selected by the Panel. 
89 Communication from New Zealand to the Panel, 11 December 2008.  This expert on fire blight was 
ultimately not selected by the Panel. 
90 Communication from Australia to the Panel, 11 D ecember 2008.  None of these experts on European 
canker was ultimately selected by the Panel. WT/DS367/R 
Page 10  
 
 objections to one of the suggested experts on fire blight.
91  Australia indicated some constraints in the 
dates by which it would be available to provide comments on proposed questions for experts.  Finally, Australia requested that, as originally set out in the Working Procedures, the expert selection process 
be completed prior to the Panel providing propo sed expert questions to the Parties for comments.
92 
1.33 On 15 December 2008, the Panel informed the Parties that, having considered their comments 
on the proposed experts, as well as the objections expressed by the Parties, the Panel had selected the 
following experts: 
• Dr Jerry Cross, Research Leader, En tomology, East Malling Research, Kent, 
United Kingdom; 
• Dr Tom Deckers, Head, Department of Pomo logy, Research Station of Fruit Growing, 
PCFruit (former Royal Research Station of Gorsem), St.Truiden, Belgium; 
• Dr Bernardo Latorre, Full Professor, Facultad de Agronomía e Ingeniería Forestal, 
Pontificia Universidad Católica de Chile, Chile; 
• Dr Jean-Pierre Paulin, Director of Res earch, Institut National de la Recherche 
Agronomique (INRA), Angers, France; 
• Dr Gritta Schrader, Scientific Collaborator, Ju lius Kühn-Institut, Fede ral Research Centre 
for Cultivated Plants, Institute for National a nd International Plant Health, Braunschweig, 
Germany; 
• Dr Ricardo Sgrillo, Researcher, Cocoa Research Center (CEPLAC/CEPEC) - Ministry of 
Agriculture, Brazil; 
• Dr Terence Swinburne, Professor and Plant pathology researcher, former Governor of 
Hadlow College, Kent, United Kingdom. 
1.34 The Panel noted that in three of the areas of e xpertise identified, it selected two experts, while 
in the area of apple leafcurling midge, in light of  the very limited number of relevant and available 
experts, as well as the comments and objections of the Parties, it had selected only one expert.  On the 
same date, the Panel notified the Parties of its pr oposed questions to the experts, inviting them to 
comment on those questions and to suggest additiona l ones.  The Panel also commented on Australia's 
argument that the expert selection process should be completed before Parties were provided the 
proposed expert questions for their comments, and noted that it found no provision in the Working Procedures that would establish any necessary sequence between the Panel selecting the experts and the Parties commenting on the proposed questions to experts.
93 
1.35 When expressing their availability, all experts we re asked by the Panel to provide preliminary 
statements regarding the absence of conflicts of inte rest, which were forwarded to the Parties.  On 
16 December 2008, the Panel contacted the identified experts to ask them to undergo a more detailed 
disclosure procedure.  The experts were asked to sign the disclosure form included in Annex 3 of the 
Rules of Conduct for the Understanding on the Rul es and Procedures Governing the Settlement of 
Disputes.  Furthermore, the Panel directed the experts to Section VI of the Rules of Conduct ( Self-
Disclosure Requirements by Covered Persons ) and asked them, if necessary, to expand on the 
information that they had already provided by disclosing any facts which, in their view, would be 
                                                      
91 This expert on fire blight was ultimately not selected by the Panel. 
92 Communication from Australia to  the Panel, 11 December 2008. 
93 Communication from the Panel to the Parties, 15 December 2008.  WT/DS367/R 
 Page 11 
 
 
 likely to affect their independence or impartiality as experts, or give rise to justifiable doubts in that 
regard.  In particular, the Panel noted that it was interested in any relevant information regarding 
previous work for any of the Parties in relation to th e matter at issue in this dispute or, more generally, 
regarding any of the items exemplified in the illustra tive list of information to be disclosed, contained 
in Annex 2 of the Rules of Conduct.94  On 18 December 2008, the experts' replies and disclosure 
forms were forwarded to the Parties.95 
1.36 In a letter dated 19 December 2008, New Z ealand provided its comments on the Panel's 
proposed questions to the experts and s uggested a number of additional questions.96  O n  t h e  s a m e  
date, Australia provided its comments on the Panel's pr oposed questions to the experts.  Australia also 
reiterated its compelling objection to one of the e xperts selected by the Panel (Dr Jerry Cross) and 
reaffirmed its strong preference that two ALCM experts be appointed to assist the Panel.97 
1.37 On 18 December 2008, the Panel informed the Parties that, in accord ance with the Working 
Procedures, it intended to send to the selected expert s on a confidential basis the submissions filed by 
the Parties and the accompanying exhibits.  The Panel added that, unless New Zealand raised any 
objections, it would include in the material the exhi bits submitted by New Zealand that were marked 
"business in confidence".  Having received no objecti ons from the Parties, on 23 December, the Panel 
sent the submissions and the accomp anying exhibits to the experts.98 
1.38 After considering the Parties' comments and re vising the draft questions, on 16 January 2009 
the Panel sent 142 written questions to the selected experts.99  Parties received a copy of the questions 
sent to the experts on the same date.100  The Panel requested that the experts provide their written 
replies to the questions by 23 February 2009.101  As a result of the amendments to the timetable made 
by the Panel on 2 February 2009, and in the light of the request of some experts, the deadline given to 
experts to provide their written replies to questions  was extended to 9 March;  Parties were also 
allowed to provide to the experts – through the Pane l – some factual clarifications that the experts 
found necessary for preparing some of their responses.102  On 9 and 10 February, the Panel relayed to 
the Parties a number of requests for factual clarifications received from the experts.103  O n  
17 February, the Parties made those factual clarifications in separate communications.104  Factual 
clarifications were sent by the Pa nel to the experts on 18 February.105 
1.39 Written replies from the experts to questions  posed by the Panel were received on 
9 March 2009.106  On 10 March, the Panel relayed the expert s' written replies to the Parties for their 
comments.107  The Parties provided their comments on the experts' replies on 25 March.108  O n  
9 April, the Parties submitted comments on each  other's comments on the experts' replies.109 
                                                      
94 Electronic communications from the Panel to the selected experts, 16 December 2008. 
95 Communication from the Panel to the Parties, 18 December 2008. 
96 Communication from New Zealand to  the Panel, 19 December 2008. 
97 Communication from Australia to  the Panel, 19 December 2008. 
98 Communications from the Panel to the selected experts, 23 December 2008. 
99 Electronic communications from the Panel to  the selected expert s, 16 January 2009. 
100 Communication from the Panel to the Parties, 16 January 2009. 
101 A compilation of the experts' written replies is attach ed to this report as Annex B-1, and is available 
only electronically. 
102 Communication from the Panel to the Parties, 2 February 2009. 
103 Communications from the Panel to the Parties, 9 and 10 February 2009. 
104 Communications from New Zealand and Australia to the Panel, 17 February 2009. 
105 Electronic communication from the Panel to the experts, 18 February 2009. 
106 A compilation of the experts' written replies is attach ed to this report as Annex B-1, and is available 
only electronically. 
107 Communication from the Panel to the Parties, 10 March 2009. WT/DS367/R 
Page 12  
 
 (b) Due process concerns raised by Australia 
1.40 In its comments on the experts' replies of 25 March 2009, Australia raised procedural 
concerns regarding the expert consultation process, including some that were qualified by Australia as 
due process concerns.  Some of these concerns had already been raised by Australia on 19 December 
2008, when providing its comments on the Panel's proposed questions to the experts, although at the 
time those concerns had not been qualifie d by Australia as "due process concerns".
110  Likewise, in its 
comments of 9 April on New Zealand's comments on the experts' replies and in  its rebuttal submission 
of 21 April, Australia reiterated some of these concer ns and raised some other ones.  In the course of 
the Panel's second substantive meeting with the Parties, the Panel asked Australia a number of 
questions regarding the concerns it had raised.  In particular, the Panel asked Australia to identify the 
nature of its due process concerns and to explain in what manner its rights had in its view been 
impaired.  Similar written questions were posed to  Australia by the Panel after the second substantive 
meeting.111  New Zealand was invited by the Panel to  comment on these points.  Both New Zealand 
and Australia offered their views in  response to the Panel's questions. 
(c) Additional revisions of the timetable 
1.41 Because of the long time needed to identify available experts in th e areas selected by the 
Panel, on 21 October 2008 the Panel informed the Pa rties that it would not be possible to send the 
proposed list of experts and questions to the Parti es on 22 October, as originally scheduled in the 
timetable adopted on 8 April 2008.   The Panel added that it hoped to be in a position to propose new 
dates for the following steps in the proceedings  as soon as new information on experts became 
available, and no later than during the first week of November.112  In a communication sent on 24 
October, Australia asked the Panel to take into account the constraints of a key member of its 
delegation from 23 March to 3 April 2009, in case the second substantive meeting was rescheduled.113  
Australia also asked the Panel to sp ecify, in an eventual revised time table, the date in which Parties 
would receive responses from the selected experts, a nd to allow Parties at least two weeks, or possibly 
longer, to comment on the experts' replies. 
1.42 On 31 October 2008, the Panel informed the Par ties that, because of the delay in identifying 
possible experts, the meetings with the experts a nd the second substantive mee tings with the Parties, 
originally scheduled to take place on 3 to 5 Ma rch 2009 in accordance with the timetable adopted on 
8 April 2008, would need to be postponed.114  The Panel added that it expected to contact the Parties 
again with a proposed new timetable, taking into acc ount the Parties' preferences expressed thus far, 
in the course of the following week. 
1.43 On 11 November 2008, the Panel sent to the Parties a proposed revised timetable;  this 
proposal included a delay in the dates originally scheduled, and identified th e date on which Parties 
would receive responses from the selected expe rts in accordance with Australia's request.115  Parties 
commented on the proposed revision to the timetable on 12 November;  New Zealand had no objections to the new dates proposed by the Panel
116, while Australia requested that more time be 
granted to Parties to reply to the Panel's ques tions after the second substantive meeting and to 
                                                                                                                                                                     
108 Communications from New Zealand and Australia to the Panel, 25 March 2009. 
109 Communications from New Zealand and Australia to the Panel, 9 April 2009. 
110 Communication from Australia to  the Panel, 19 December 2008. 
111 See, in particular, Panel questions 20 to  26 after the second substantive meeting. 
112 Electronic communication from the Panel to the Parties, 21 October 2008. 
113 Electronic communication from Australia to the Panel, 24 October 2008. 
114 Electronic communication from the Panel to the Parties, 31 October 2008. 
115 Communication from the Panel to the Parties, 11 November 2008. 
116 Electronic communication fr om New Zealand to the Panel, 12 November 2008.  WT/DS367/R 
 Page 13 
 
 
 comment on each other's replies.117  After having considered the Parties' comments, on 14 November 
the Panel informed the Parti es of the revised timetable.118  On 9 December 2008, the Panel informed 
the Parties of a delay in finalizing the list of proposed questions to the experts.119  As noted above120, 
the Panel sent to the Parties its list of proposed questions to the experts on 15 December 2008;  in 
accordance with the revised timetable  adopted on 14 November, Parties were given four working days 
to comment on the proposed questions. 
1.44 On 23 December 2008, the Panel informed the Pa rties that, because of the nature and the 
number of comments made by the Parties on the pr oposed questions to the experts on 19 December, 
the Panel would not be in a position to send the ques tions to experts before the end of the year, as 
intended.  The Panel proposed revising the timetable for the upcoming steps in the expert consultation 
process, indicating that the dates for subsequent steps would remain as indicated in the revised 
timetable that had been adopted on 14 November.121  On 6 January 2009, Australia commented on the 
Panel's proposed revised timetable.  Australia re quested that the date for submitting the Parties' 
rebuttals be extended by one week as had b een proposed by the Pa nel for other steps.122  New Zealand 
made no comments on the Panel's proposed revised timetable. 
1.45 On 8 January 2009, the Panel informed the Par ties that, because of the extensive comments on 
the draft questions to the experts received from the Parties, the Panel would be able to send those 
questions to the experts only by the end of the follo wing week.  In the light of this delay, the Panel 
intended to propose a new revised timetable to the Parties.123  On 12 January, New Zealand expressed 
its hope that any delays in the proceedings would be kept to an absolute minimum so that the dispute 
could be addressed in a timely fashion.124  On 16 January, the Panel sent to the Parties a proposed 
revised timetable for the proceedings.125  On 21 January 2009, New Zealand commented on the 
Panel's proposed revised timetable.  New Zealand s uggested alternative dates for the Panel's second 
substantive meeting and indicated some constraints w ith regard to the dates that it would be available 
to participate in that meeting.126  On the same date, Australia made its own comments on the Panel's 
proposed revised timetable;  Australia indicated some  time constraints, because some members of its 
delegation would not be available to participate in  the preparation of its rebuttal submission, and 
consequently requested that the date for submitting the Parties' rebuttals be  extended by two weeks 
and that the dates for the Parties' replies to qu estions and comments on replies be extended by one 
week in order to take account of the significant travel times after the Panel's second substantive 
meeting.127  After having considered the Parties' comme nts, taken into account the constraints that 
were expressed, and confirmed the experts' availab ility, on 2 February the Panel informed the Parties 
of the revised timetable.128 
1.46 On 22 June 2009, the Panel informed the DSB that, as a result of the time required for the 
expert consultation process, including the time needed  to identify and select experts, to prepare the 
questions for the experts in consultation with the Pa rties, the time required by the experts to prepare 
their responses and the time provided to the Par ties to comment on these responses, the Panel would 
not be able to issue its report by July 2009 as it had previously informed the DSB.  The Panel also 
                                                      
117 Electronic communication from Australia to the Panel, 12 November 2008. 
118 Communication from the Panel to the Parties, 14 November 2008. 
119 Electronic communication fr om the Panel to the Parties, 9 December 2008. 
120 See para. 1.34 above. 
121 Communication from the Panel to the Parties, 23 December 2008. 
122 Communication from Australia to the Panel, 6 January 2009. 
123 Electronic communication from the Panel to the Parties, 8 January 2009. 
124 Electronic communication from New Zeal and to the Panel, 12 January 2009. 
125 Communication from the Panel to the Parties, 16 January 2009. 
126 Electronic communication from New Zeal and to the Panel, 21 January 2009. 
127 Communication from Australia to the Panel, 21 January 2009. 
128 Communication from the Panel to the Parties, 2 February 2009. WT/DS367/R 
Page 14  
 
 informed the DSB that it expected to issue its fina l report to the Parties by January 2010, as envisaged 
in the revised timetable adopted after consultations with the Parties.
129 
10. Written rebuttal submissions by the Parties 
1.47 Following their comments on experts' responses,  New Zealand and Australia filed their 
written rebuttal submissions on 21 April 2009.  In  accordance with the Working Procedures adopted 
by the Panel, both Parties submitted an executiv e summary of their respective written rebuttals. 
11. Second substantive meeting of the Panel with  the Parties and Panel's meeting with the 
experts 
1.48 Having noted the Parties' wish that the Panel's substantive meetings with the Parties be open 
to viewing by the public, on 27 April 2009 the Pane l sent a message to the Parties asking for their 
views regarding the possible format for the Pa nel's second substantive meeting and the Panel's 
meeting with the experts.130  On 5 May, the Panel received a response from New Zealand.131  On the 
same date, Australia provided its ow n response, together with a number of questions to the Panel in 
relation to the Panel's meeting with the experts and the second substantive meeting.132 
1.49 On 3 June 2009, the Panel sent to the Parties a set of draft procedures for the second 
substantive meeting and for the Panel's meeting with  the experts.  As noted by the Panel in its 
communication, the draft procedures were prepared w ith the intention of providing the Parties with a 
useful guideline for the meetings, especially regard ing the purpose of the Panel's meeting with the 
experts, the focus of the discussions, the subject ar eas in which the discussion would be organized, as 
well as on the nature and form in which questions should be posed to the experts.133  On 9 June, 
New Zealand expressed its acceptance of the proposed text.134  On the same date, Australia made a 
number of comments on the draft procedures and request ed some clarifications from the Panel, while 
generally agreeing to the proposed text.135  On 11 June, Parties were notified by the Panel of the rules 
of procedure adopted for the second substantive meeting and for the Panel's meeting with the 
experts.136 
1.50 The Panel met with the designated experts on 30 June 2009, in the presence of the Parties.  
The meeting provided an opportunity for the Panel and the Parties to ask questions to the experts and 
for the experts to clarify points that they had ma de earlier in their written responses to questions.  
Following a request from the Parties, the Panel deci ded to make publicly available a compilation of 
the experts' written responses and a transcri pt of the Panel's meeting with experts.137 
1.51 The Panel held its second substan tive meeting with the Parties on 1 and 2 July 2009.  Both the 
Panel's meeting with the experts and the Panel' s second substantive meeting were open for public 
viewing from a separate room via closed-circuit tele vision broadcast.  In the course of the meeting, 
                                                      
129 Communication from the Panel to the DSB, 22 June 2009.  See Australia – Apples , Communication 
from the Chairman of the Panel (WT/DS367/9), 29 June 2009. 
130 Electronic communication from the Pane l to the Parties, 27 April 2009. 
131 Electronic communication from New Z ealand to the Panel, 5 May 2009. 
132 Communication from Australia to the Panel, 5 May 2009. 
133 Communication from the Panel to the Parties, 3 June 2009. 
134 Communication from New Zealand to the Panel, 9 June 2009. 
135 Communication from Australia to the Panel, 9 June 2009. 
136 Communication from the Panel to the Parties, 11 June 2009. 
137 The List of replies from the scientific experts to questions posed by the Panel and the Transcript of 
the Panel's meeting with the scientific experts are part  of this report.  Both do cuments are available only 
electronically.  See Annex B-1 and Annex B-2 of this report.  WT/DS367/R 
 Page 15 
 
 
 New Zealand submitted evidence contained in th ree exhibits (NZ-135, NZ-136 and NZ-137);  
Australia stated that it had no objections to these exhibits becoming part of the record.138 
1.52 On 10 July 2009, the Panel sent written questi ons to the Parties.  On the same date, 
New Zealand and Australia each sent a number of writte n questions to the other Party.  On 24 July, 
the Panel received responses to questions from New Zealand and Australia.  On 31 July, both 
New Zealand and Australia submitted comments on the other Party's responses to questions. 
12. Issuance of the report 
1.53 The descriptive (factual and argument) sections of the Panel's draft report were issued to the 
Parties on 2 October 2009.  On the same date, Chile, the European Comm unities, Japan, Chinese 
Taipei and the United States were sent excerpts fro m the descriptive sections containing the summary 
of their respective arguments.  New Zealand a nd Australia submitted comments to the descriptive 
sections of the Panel's draft report on 16 October.   On the same date, th e European Communities, 
Japan, Chinese Taipei and the United States expressed they had no comments to the relevant excerpts. 
1.54 The Panel issued its interim report to the Par ties on 31 March 2010.  As noted in the interim 
review section of the report, on 15 April, in accordance with Article 15 of the Dispute Settlement 
Understanding (DSU) and paragra ph 14 of the Panel's Working Procedures, New Zealand and 
Australia submitted written comments and requested the Panel to revise precise aspects of the interim 
report.  On 22 April, New Zealand and Aust ralia submitted written comments on each other's 
comments and requests for interim review.  Neither Party requested an interim review meeting with 
the Panel. 
II. FACTUAL ASPECTS 
A. PESTS AT ISSUE  
1. Fire blight 
2.1 Fire blight is a plant disease caused by the bacterium Erwinia amylovora (or E. amylovora ).  
In apple trees, fire blight  infects flowers, young leaves, stems a nd fruits.  Symptoms of infection of 
host plants depend on the parts infected.  Infected flowers droop, wither and die, becoming dry and 
darkened in colour.  Infected shoots and twigs with er, darken and die.  As shoots and twigs wither, 
they bend downwards resembling a shepherd's crook.  Infected leaves become curled and scorched.  
Infected fruit fail to develop fully, turning br own to black, and becoming mummified, frequently 
remaining attached to the limb.139  Limbs and trunks of trees may also develop cankers (sunken areas 
surrounded by cracked bark) which, if disease de velopment is severe, may result in tree death.140 
(a) Host plants 
2.2 The fire blight disease affects numerous host plants of the Rosaceae family, including both 
cultivated and native wild plants.  Fruit tree hos ts include apples, pears, quince, and loquats.141  
                                                      
138 Australia subsequently clarified that its acceptan ce of these three new exhibits being made part of 
the record was a separate question of how they should be treated by the Panel.  In Australia's view, in 
accordance with paragraph 11 of the Panel's working proc edures, these new exhibits may not contribute to the 
making of New Zealand's prima facie case, as only materi al necessary for rebuttal purposes may be exhibited in 
the latter stage of panel proceedings.  Australia's reply to Panel question 7 after the second substantive meeting, 
paras. 33-42. 
139 Australia's IRA, Part B, p. 52;  New Zealand's first written submission, para. 3.47. 
140 New Zealand's first writte n submission, para. 3.47. 
141 Australia's IRA, Part C, p. 105;  New Zealand's first written submission, para. 3.46. WT/DS367/R 
Page 16  
 
 Within each genus, there are species or cultivars that may show a high level of resistance under 
natural conditions or ar tificial inoculations.
142  There are several plant sp ecies of the Rosaceae family 
in Australia.  According to the IRA, hosts include Amelanchier spp.; Aronia spp.; Chaenomeles spp.; 
Cotoneaster spp.; Crataegus spp.; Cydonia spp.; Dichotomanthes spp.; Docynia spp.; Eriobotrya sp.; 
Heteromeles sp.; Malus spp.; Mespilus sp.; Osteomeles sp.; Peraphyllum spp.; Pyracantha spp.; 
Pyrus spp.; Rhaphiolepis spp.; Sorbus spp.; and Photinia spp.143 
(b) Life cycle 
2.3 Fire blight bacteria ( E. amylovora ) overwinter exclusively in infected host plants, mainly in 
the previous season's cankers.144  In the presence of warm, wet conditions in spring, the disease cycle 
commences when cankers on infected trunks and s hoots become active and exude a bacteria-laden 
ooze, which is the inoculum for primary infection in the spring time.145 
2.4 Cankers become inactive during the growing season,  especially in warmer, drier months.  The 
cankers generally cease ooze production during the ho t summer months and remain inactive until the 
following spring when they reactivat e and the disease cycle begins again.146 
(c) Spread 
2.5 The bacteria may spread within host plants, infecting blossoms, fruits, spurs, twigs, branches, 
and leaves, and form new cankers on infected branches and twigs.147  With appropriate environmental 
conditions, inoculum may then be exuded from infected shoots, canke red bark, and infected fruitlets 
and blossoms.  Infection may also occur when host plants produce sporadic, late blossoms ("rattail 
bloom").148  Rain, insects, wind and pruning tools are th e main methods of spreading inoculum of 
E. amylovora .149  Bees are the primary agents for secondary sp read of inoculum from infested flowers 
to newly opened ones.150 
2.6 Depending on orchard conditions, fruit can  be infested with low levels of E. amylovora .151  
This occurs when small populations of bacteria are present on the developing flower parts.  An 
infested flower can develop into a mature apple, but  bacteria are localized in the calyx (remnant of the 
blossom) in small numbers.152  In orchards with fire blight symptoms, bacteria can also be present in 
low numbers on the surface of the apple, for example when rain transfers bacteria from another part of 
a tree to fruits.  Such external populations would not multiply and would tend to diminish over time.
153 
                                                      
142 Australia's IRA, Part C, pp. 105-106. 
143 Australia's IRA, Part C, p. 106. 
144 Australia's IRA, Part B, p. 51, and Part C, p. 110;  New Zealand's first written submission, 
para. 3.48. 
145 Australia's IRA, Part C, p. 111;  New Zealand's first written submission, para. 3.48. 
146 New Zealand's first writte n submission, para. 3.49. 
147 Australia's IRA, Part C, pp. 109-110;  New Zealand's first written submission, para. 3.50. 
148 New Zealand's first writte n submission, para. 3.50. 
149 Australia's IRA, Part B, p. 51, and Part C, p. 110. 
150 Australia's IRA, Part B, p. 51;  New Zealand's first written submission, para. 3.48. 
151 Compilation of expert replies, paras. 44 and 53.  Regarding fruit infestation, see also Australia's 
IRA, Part  B, pp.52, 55-65; Part C, pp.117-119; Ne w Zealand's first written submission, paras. 4.13-4.16.  
"Infestation" refers to the presence of an organism (e.g. bacteria, fungus, insect) on the outside of a host plant 
(including the fruit), without any implication that an infection has occurred. 
152 Australia's IRA, Part B, p. 52;  New Zealand's first written submission, para. 3.51. 
153 Compilation of expert replies, paras. 44, 53 and 62; Transcript of the Panel's meeting with experts, 
paras. 230 and 395,   WT/DS367/R 
 Page 17 
 
 
 (d) Geographical distribution 
2.7 Fire blight is thought to be native to Nort h America.  The earliest known observation and 
description of the disease was reported in New York St ate in the United States in 1793.  By the early 
1900s, fire blight had been reporte d in Canada from Ontario to Britis h Columbia, in northern Mexico, 
and in the United States from the East Coast to Ca lifornia and the Pacific Northwest.  Fire blight has 
been identified across northern and western Europe , the Mediterranean region and several Central 
European countries, although it remains localized in  France and Switzerland and is restricted to 
certain spots in Spain, Italy, and Austria.  Portuga l and Finland are fire blight-free and Norway has an 
eradication programme underway.  Most recently fire blight has been reported in Latvia, Morocco and 
Syria.  Latin America and substantial parts of A frica and Asia apparently remain fire blight-free.154 
2.8 Fire blight was first reported in New Zealand in 1919.  Its establishment and spread around 
the country is thought to be associated with th e movement of infected rootstocks and nursery 
material.155  In 1997 fire blight was detected in Austra lia in the Melbourne Royal Botanic Gardens, 
but eradication efforts were undertaken and no further outbreaks have been reported.156 
2. European canker 
2.9 European canker is a plant disease caused by the fungus Neonectria galligena  (or 
N. galligena ).  The primary symptom of infected plants  is the production of cankers on limbs and 
trunks.  The fungus can infect fruit and cause lesions that develop into "fruit rots", mainly under 
conditions of high summer rainfall.157 
(a) Host plants 
2.10 Hosts of this fungus include tree species in the genera Acer (maple), Aesculus (horse 
chestnut), Alnus (alder), Betula (birch), Carya (h ickory), Cornus (dogwood), Corylus (hazel), Fagus 
(beech), Fraxinus (ash), Juglans (walnut and butter nut), Liriodendron tulipifera (tulip tree), Malus 
(apple), Populus (aspen), Prunus (cherry), Pyrus (pear ), Quercus (oak), Salix (willow), Sorbus (rowan 
tree), Tilia (American basewood) and Ulmus (elm).158 
(b) Life cycle 
2.11 N. galligena produces two types of spores:  asexual spores (called "conidia") and sexual 
spores (called "ascospores").159  Conidia are produced from tree cankers during humid conditions, 
mainly in late summer, autumn and spring.160  Conidia also may be produced on infected fruit 
showing visible rot symptoms.  Ascospores are produced in fruiting bodies called "perithecia", 
produced by the sexual stage of the fungus.  Perith ecia only occur in regions with a climate conducive 
to their development.  Perithecia produce asco spores mainly during late winter and spring.161  
                                                      
154 New Zealand's first written s ubmission, paras. 3.52-3.53. 
155 New Zealand's first writte n submission, para. 3.54. 
156 Australia's first written submission, para. 77;  Aust ralia's IRA, Part C, p. 107;  New Zealand's first 
written submission, para. 3.55. 
157 Australia's IRA, Part C, pp. 100 and 102;  New Z ealand's first written submission, paras. 3.56-3.57.  
See also Compilation of experts replies, paras. 305, 311,348, 356, 435, 438. 
158 Australia's IRA, Part B, p. 117;  New Zealand's first written submission, para. 3.56. 
159 Australia's IRA, Part C, p. 100;  New Zealand's first written submission, para. 3.58. 
160 Australia's IRA, Part C, p. 100;  New Zealand's first written submission, para. 3.59. 
161 Australia's IRA, Part C, p. 100;  New Zealand's first written submission, para. 3.60. WT/DS367/R 
Page 18  
 
 Perithecia and ascospores have occasionally b een reported on fruit overwintered under specific 
conditions.
162 
2.12 European canker infection163 occurs when spores (conidia or ascospores) that have been 
deposited on the surface of a host plant enter the plant through wounds in the plant surface.  The 
infection process requires wetness on the plant surface.164  Leaf scars (that result from leaf fall in 
autumn) are the most important site of infecti on.  Wounds arising from orchard practices or from 
natural cracks in tree branches also provide infec tion sites for both conidia and ascospores at times 
other than leaf fall.165  Infection of the fruit can take place through the open calyx, lenticels and scab 
lesions, or wounds caused by insects.166 
2.13 After infection, the fungus grows within the plan t and remains latent for a period of weeks to 
months, depending on temperature.167  Eventually, disease symptoms appear as cankers on wood or 
lesions on fruit.  In regions where the climate is conducive to fruit infection a proportion of the 
infections may remain latent within the fruit at the ti me of harvest.  However, not all latently infected 
fruit will express rot symptoms.168 
2.14 After a period of wood canker or fruit lesi on growth (weeks to months, depending on 
temperature), conidia may be produced on cankers or lesions.  After a further period, which generally 
includes a winter, perithecia may be produced on wood cankers or on mummified fruit.169 
(c) Spread 
2.15 As mentioned above, European canker is transmitte d by spores. Conidia are spread mainly by 
rain splash over relatively short distances, while ascospores are spread mainly by wind.170  Several 
factors influence spore production, spore survival a nd infection, but the most important is climate.171  
The Parties disagree about the climatic conditions conducive to the spread of European canker. 
2.16 The pattern of European canker infection varies in  different parts of the world.  In Northern 
Ireland, where rainfall occurs in all seasons, inoculum  is available all year round, spring and summer 
are a critical period for infection, and ascospores play an important role.  In California, in contrast, 
which has pronounced dry periods over the summer m onths, infection occurs in the winter rainy 
season, and conidia are considered to play the major role in infection.172 
                                                      
162 Australia's IRA, Part C, pages 100-101;  Ne w Zealand's first written submission, para. 3.60. 
163 Infection refers to the process by which an organism (e.g., N. galligena ) enters into a host plant and 
establishes a pathogenic relationship with the host. 
164 New Zealand's first written submission, para. 3.62;  Transcript of the Panel's meeting with experts, 
para. 525;  Australia's first written s ubmission, para. 627;  Australia's second written submission, para. 535 and 
Annex 2, pp. 247-250. 
165 Australia's IRA, Part C, page 101;  New Zealand's first written submission, para. 3.61. 
166 See, Swinburne, "European Canker of Apple ( Nectria galligena )" (1975), in Exhibit NZ-9;  
Australia's IRA, Part C, p. 102. 
167 If an infection gets into trees through nurseries,  it can remain symptomless for 3-4 years.  See, 
Australia's IRA, Part C, p. 102. 
168 New Zealand's first writte n submission, para. 3.62. 
169 Australia's IRA, Part C, pp. 100-101;  New Zealand's first written submission, para. 3.63. 
170 Australia's IRA, Part C, p. 101;  New Zealand's first written submission, para. 3.64;  Compilation of 
experts replies, paras. 365 and 398. 
171 New Zealand's first writte n submission, para. 3.66. 
172 Australia's IRA, Part C, p. 101,  New Zealand' s second written submittion, paras. 2.201-2.202;  
Compilation of experts replies, paras. 396, 416;  Transcript of the Panel's meeting with experts, para 525.  WT/DS367/R 
 Page 19 
 
 
 (d) Geographical distribution 
2.17 European canker is present in large parts of  Europe, North America, South America, the 
Middle East, and South Africa.173  The worldwide distribution of European canker appears to 
correspond to major apple and pear growing regions,  although its occurrence is restricted to those 
areas and occasions when suitable climatic conditions occur.174 
2.18 European canker was first reported in New Zealand in 1905.175  Due to climatic factors, 
European canker is not found everywhere in Ne w Zealand.  Most apple export production in 
New Zealand takes place in areas where European ca nker has either never been recorded or the 
disease occurs only sporadically in very wet seasons.176  In Australia, the disease was identified in 
1954 in four orchards in Spreyton, Tasmania, but was eradicated by 1991.177 
3. Apple leafcurling midge 
2.19 The apple leafcurling midge (ALCM), or Dasineura mali , is a small fly, 1.5–2.5 mm long, 
with dusky wings covered in fine dark hairs.178  The ALCM has four life stag es:  adult, egg, larva (or 
maggot) and pupa.179  Both the adult male and female have wings and are able to fly.180  ALCM larvae 
feed on the unfurling young leaves of apple trees causi ng the leaf margins to curl or roll.  This can 
result in reduced shoot and tree growth.181 
(a) Host plants 
2.20 Apple trees (including crab-apple) are the only hosts of ALCM.182 
(b) Life cycle 
2.21 ALCM reproduce sexually.183  They have a short life span.  According to the IRA, laboratory 
evidence indicates that adult ALCM live for 2-6 days.184  New Zealand indicates that adults live 
3-4 days under laboratory conditions, and that  males live only 1-2 days in the field.185  Eggs are laid 
by mated females on soft new unfurling apple leaves at the tips of shoots and branches.  These eggs 
hatch to produce larvae, which are legless red maggots. Being legless, the larvae are essentially 
immobile and do not move far from the egg-laying  site.  The larvae develop by feeding on the 
unfurled leaf causing marginal leaf rolling, which then prevents the leaf from unfurling normally, or 
results in a curled margin on the leaf.186 
2.22 When ready to pupate, the mature larvae drop, or  crawl, from the leaves to the ground to find 
a pupation site below the surface of the ground.  Pupa tion is instigated by rainfall.  A small proportion 
                                                      
173 Australia's first written submission, para. 83. 
174 New Zealand's first writte n submission, para. 3.67. 
175 Ibid. 
176 Australia's IRA, Part B, p. 121;  New Zealand' s first written submission, para. 4.56 and Annex 3. 
177 Australia's IRA, Part B, p. 117;  New Zealand' s first written submission, paras. 3.68 and 4.93, 
Exhibit NZ-13. 
178 Australia's IRA, Part B, p. 157;  New Zealand's first written submission, para. 3.69. 
179 Australia's IRA, Part C, p. 121;  New Zealand's first written submission, para. 3.72. 
180 Australia's IRA, Part B, p. 177;  New Zealand's first written submission, para. 3.77. 
181 Australia's IRA, Part C, p. 122;  New Zealand's first written submission, para. 3.70. 
182 Australia's IRA, Part C, p. 121;  New Zealand's first written submission, para. 3.69. 
183 Australia's IRA, Part B, p. 157;  New Zealand's first written submission, para. 3.71. 
184 Australia's IRA, Part B, p. 157. 
185 New Zealand's first writte n submission, para. 3.71. 
186 New Zealand's first written submission, para. 3.72.  See also, Australia's IRA, Part C, p. 122. WT/DS367/R 
Page 20  
 
 of the pupating larvae may also lodge and pupate on the tree, often in cracks in the bark or sometimes 
on the calyx or stalk ends of fruit.  Pupating larvae spin a white silken cocoon.
187 
2.23 The cocoons of the emerging adults remain wher e they were formed, i.e. in the soil, on the 
trunk, or on the calyx of fruit.  In spring and summer, after the required pupation period, adult ALCM emerge leaving their cocoons empty.  Males emerge  from their pupae earlier than females.  In late 
summer and autumn ALCM pupating in cocoons ente r an "overwintering" state called "diapause."
188  
Their development and emer gence is not completed until the following spring.189  The life cycle of 
ALCM (mating, egg-laying, larval growth, pupation and adult emergence) is usually repeated several 
times a year.  New Zealand mentions four , sometimes five generations per year190, while Australia 
indicates that in the north of New Zealand, there are 6-7 generations annually, and that the number of 
generations completed each year decrea ses from north to south in New Zealand.191 
(c) Spread 
2.24 Movement of ALCM happens by a mixture of a dult flight and the transportation of infested 
apple trees.192  The dispersal of ALCM appears to have been little studied.193  Both Parties refer to 
studies by Suckling et al. (2007) which found that mated female ALCM flew about 30 metres194, but 
Australia also refers to evidence that male ALCM can fly 50 metres to a pheromone source.195  One of 
the experts, Professor Cross, indicates that "[t]here is no study that shows how far the midge can fly.  
There is no definitive flight range.  So, it's rather difficult to establish what the flight range should be.  
Obviously the midge is a weak flier.  In my view , it is unlikely to be able to fly long distances."196   
Professor Cross also indicated "[i]t would be unlikely that [the midge] could fly many hundreds of metres.  But I felt that the 200 metres distance was no t totally unreasonable.  It doesn't seem to me to 
be an impossible distance for this midge to fly."
197 
(d) Geographical distribution 
2.25 ALCM are presumed to be native to Europe, wh ere they are widespread.  They are found in 
countries with cool to moderate temperate appl e producing regions.  The species also occurs in 
North America and New Zealand.198  ALCM were first recorded in New Zealand in 1950.199  ALCM's 
establishment and spread around the country is associat ed with the movement of infested rootstocks 
and nursery material.200  Australia reports that it is free from ALCM.201 
                                                      
187 Australia's IRA, Part C, p. 122;  New Zealand's first written submission, para. 3.73. 
188 A period of suspension of development in some insects. 
189 Australia's IRA, Part C, p. 122;  New Zealand's first written submission, para. 3.74. 
190 New Zealand's first writte n submission, para. 3.75. 
191 Australia's IRA, Part C, p. 123. 
192 Australia's IRA, Part C, p. 125;  New Zeal and's first written submission, paras. 3.78-3.79. 
193 Australia's IRA, Part C, p. 125. 
194 Australia's IRA, Part B, p. 171;  Australia's fi rst written submission, paras. 802-804;  New Zealand's 
first written submission, para. 3.77. 
195 Australia's first written submission, paras. 802-80 8;  Exhibits AUS-95 and AUS-96;  Australia's 
IRA, Part B, pp. 171 and 177  Compilation of expert replies, para. 530; Transcript of the Panel's meeting with 
experts, paras. 582-584. 
196 Transcript of the Panel's meeting with experts, para. 584. 
197 Transcript of the Panel's meeting with experts, para. 586. 
198 Australia's IRA, Part C, p. 121;  New Zealand's first written submission, para. 3.78. 
199 Australia's IRA, Part C, p. 125;  New Zealand's first written submission, para. 3.79. 
200 Australia's IRA, Part C, p. 125;  New Zealand's first written submission, para. 3.79. 
201 New Zealand's first writte n submission, para. 3.80.  WT/DS367/R 
 Page 21 
 
 
 B. THE FINAL IRA REPORT  
2.26 The Final Import Risk Analysis Report for Apples (IRA) from New Zealand was issued by 
Biosecurity Australia in three parts in November 2006:   Part A contains a summary of the import risk 
analysis;  Part B contains the full detail of the anal ysis;  and Part C contains technical details on the 
full range of pests considered.  The IRA is a larg e document, comprising about 600 pages altogether. 
2.27 The scope of the risk analysis is the importation of mature apple fruit free of trash, either 
packed or sorted and graded bulk fruit from New Zealand.202  In addition to fire blight, European 
canker and apple leafcurling midge, the IRA includes assessments of eight other pests.203 
2.28 From October 2001 onwards, preparation of th e IRA was carried out by a seven-member 
import risk analysis team (IRA Team, initially known as Risk Analysis Panel), including two officials 
from Biosecurity Australia;  an official from South Australia's Department of Primary Industries and 
Resources;  an official from CSIRO (Commonwealth Scientific and Industrial R esearch 
Organisation) Sustainable Ecosystems204;  a fruit production specialist from Australia;  and an owner 
and manager of an apple production business in Australia.205 
2.29 At various stages of the preparation of the IRA, stakeholders made comments on the 
successive drafts.206  Biosecurity Australia maintains a regist er of stakeholders to assist effective 
consultation and communication.  Stakeholders  comprise government agencies, individuals, 
community or industry groups or organisations, in Australia and overseas, including the proponent or 
applicant for a specific proposal, having an interest in the subject matter of an IRA. 207 
1. Chronology 
2.30 Australia banned the importation of New Zealand apples in 1921, following the entry and 
establishment of fire blight in Auckland in 1919.208  In 1986, 1989 and 1995 New Zealand applied for 
access to the Australian apple market.209  In each case its application was rejected.210 
2.31 In 1996 the Australian Quarantine and Insp ection Service (AQIS) commenced a risk 
assessment that was released in 1998.211  Following a new request fo r access to the Australian market 
filed by New Zealand in January 1999, the Aust ralian Quarantine and Inspection Service (AQIS) 
initiated the import risk analysis for New Zeala nd apples which is the subject of this dispute.212  
Biosecurity Australia (then a part of AQIS) issued a first draft of the risk analysis in October 2000.213  
In November 2000, the Committee on Rural and Regi onal Affairs and Transport Legislation of the 
                                                      
202 Australia's IRA, Part B, p. 9. 
203 These other pests are:  garden featherfoot, grey -brown cutworm, leafrolle rs, apple scab or black 
spot, codling moth, mealybugs, Oriental fruit moth and oystershell scale. 
204 CSIRO (Commonwealth Scientific and Industrial Research Organisation) is Australia's national 
science agency. 
205 Australia's IRA, Part B, p. 10;  New Zealan d's First Written Submission, paras. 3.21-3.22. 
206 Australia's IRA, Part A, pp. 3 and 21, and Part B, pp. iii and 6-10. 
207 Import risk analysis handbook  (Canberra, 2003) in Exhibit AUS-10, p. 9 . 
208 Australia's IRA, Part B, p. 7.  See also New Zealand's first written submission, para. 3.1. 
209 Australia's IRA, Part B, p. 7.  See also Ne w Zealand's first written submission, para. 3.2-3.6. 
210 Australia's IRA, Part B, p. 7. 
211 Australia's IRA, Part B, pp. 7-8.  See also New Zealand's first written submi ssion, paras. 3.4-3.6 and 
p. 212. 
212 Australia's IRA, Part B, pp. 8-9.  See also  Australia's first written submission, para. 66;  
New Zealand's first written submission, para. 3.7. 
213 Australia's IRA, Part B, p. 8.  See also Australia's first written su bmission, para. 67;  New Zealand's 
first written submission, para. 3.12. WT/DS367/R 
Page 22  
 
 Australian Senate launched a first inquiry into the assessment of apple imports from New Zealand by 
Australia's quarantine agencies.
214  The Committee's interim report, including recommendations, was 
delivered in July 2001.215 
2.32 A revised draft risk assessment was issued by Biosecurity Australia in February 2004 and was 
followed by a comment period.216  The Australian Senate Committee launched a second inquiry in 
March 2004.217  In August 2004, an Eminent Scientists Group was created to independently examine 
all final draft IRAs before their release and to en sure that technical submissions from stakeholders 
were properly taken into account.218  Biosecurity Australia was made a prescribed agency (financially 
independent from the Department of Agriculture, Fisheries and Forestry) in October 2004, and the 
Australian Government decided that Biosecurity Au stralia would review and reissue draft IRAs in 
progress at that time, including the one on New Zealand apples.219  The Australian Senate 
Committee's report on the importation of apples from New Zealand was issued in March 2005.220  
After reviewing stakeholder comments, Biosecurity Australia issued another revised draft import risk analysis in December 2005, again providing a comment period.
221  The Final IRA was issued in 
November 2006.222 
2.33 The IRA requires New Zealand to prepare a doc umented standard operating procedure (SOP) 
describing the phytosanitary procedures for each qua rantine pest of concern and the responsibilities of 
the parties.  The SOP must be approved by AQIS befo re exports start and is subject to AQIS audits.  
The SOP would be based on a work plan to be  developed between Aust ralia and New Zealand. 223  
Australia and New Zealand have not been able to agree on an SOP.224 
2. Methodology 
2.34 The technical component of an import risk analysis  for plants or plant products is called a pest 
risk analysis (PRA).  Australia's IR A carries out the PRA in three stages: 
(a) Initiation of the PRA; 
(b) pest risk assessment;  and, 
(c) pest risk management.225 
(a) Process of pest risk assessment 
2.35 In describing its process for pest risk assessme nt, the IRA identifies four interrelated steps:226 
                                                      
214 New Zealand's first writte n submission, para. 3.15. 
215 New Zealand's first writte n submission, para. 3.19. 
216 Australia's IRA, Part B, p. 8.  See also Australia's first written submission, para. 69. 
217 New Zealand's first writte n submission, para. 3.27. 
218 Australia's first written submission, para. 70 and Annex 1;  New Zealand's first written submission, 
para. 3.28. 
219 Australia's IRA, Part B, p. 8.  Australia's first written submission, para. 70 and Annex 1;  
New Zealand's first written submission, paras. 3.28-3.29. 
220 New Zealand's first writte n submission, para. 3.30. 
221 Australia's IRA, Part B, p. 8.  See also Austra lia's first written submission, para. 71 and Annex 1;  
New Zealand's first written submission, para. 3.31. 
222 Australia's IRA, Part B, cover page.  Australia's first written submission, para. 72 and Annex 1;  
New Zealand's first written submission, para. 3.34. 
223 Australia's IRA, Part B, pp. 313-314;  New Zealand's first written submission, para. 3.35. 
224 Australia's first written submission, Annex 1, p. 336;  Australia's reply to Panel questions 27-31 
after the first substantive meeting;  New Zeal and's first written submission, paras. 3.36-3.38. 
225 Australia's IRA, Part B, p. 11.  WT/DS367/R 
 Page 23 
 
 
 (a) Pest categorization; 
(b) the assessment of the probability of entr y, probability of establishment, and the 
probability of spread; 
(c) the assessment of consequences;  and, 
(d) combining the probability of entry, establis hment and spread with the estimate of 
consequences to estimate the unrestricted risk.227 
2.36 For the three pests at issue, Australia has characterized the approach taken in the IRA as 
combining a quantitative assessment of the probabilit y of entry, establishment and spread with a 
qualitative assessment of the consequences.  This se mi-quantitative approach is elaborated below. 
(b) Pest categorization 
2.37 According to the IRA, the purpose of pest categor ization is to identify whether or not a pest 
should be considered a quarantine pest, thereby reducing the number of pests that have to be 
examined in a risk assessment.228  Based on the International Sta ndards for Phytosanitary Measures 
(ISPM) No. 11 adopted by the International Plant Protection Convention, Pest risk analysis for 
quarantine pests, including analysis of environmental risks and living modified organisms , the IRA 
carries out its pest categorization in six steps: 
(a) Compilation of species lists; 
(b) presence or absence within Australia; 
(c) potential for being on the pathway; 
(d) potential for establishment or spread; 
(e) potential for consequences;  and, 
(f) final categorization.229 
2.38 As a result of the pest categorization, the IR A concludes that the following ten species (eight 
insects, one bacterium and one fungus) require cons ideration for the whole of Australia:  Apple 
leafcurling midge ( D. mali );  Garden featherfoot ( S. horticola );  Grey-brown cutworm ( G. mutans );  
Brownheaded leafroller ( C. herana );  Brownheaded leafroller ( C. obliquana );  Greenheaded leafroller 
(P. excessana );  Greenheaded leafroller ( P. octo  Dugdale);  Native leafroller ( P. plagiatana );  Fire 
blight ( E. amylovora );  and, European canker ( N. galligena ).230 
2.39 The IRA additionally concludes that the follo wing six species (five insects and one fungus) 
require consideration for Western Australia only:  Codling moth ( C. pomonella );  Mealybug ( P. mali );  
Citrophilus mealybug ( P. calceolariae );  Oriental fruit moth ( G. molesta );  Oystershell scale 
(D. ostreaeformis );  and, Apple scab ( V. inaequalis ).231  The IRA notes in this regard that: 
                                                                                                                                                                     
226 Australia's IRA, Part B, p. 13. 
227 Australia's IRA, Part B, pp. 13-14. 
228 Australia's IRA, Part B, p. 14.  See also, Australia's IRA, Part A, p. 4. 
229 Australia's IRA, Part B, p. 14. 
230 Australia's IRA, Part B, pp. 47-48.  S ee also, Australia's IRA, Part A, pp. 11-12. 
231 Australia's IRA, Part B, pp. 47-48.  S ee also, Australia's IRA, Part A, pp. 11-12. WT/DS367/R 
Page 24  
 
 "Western Australia has a pest and disease stat us that, in some respects, is different 
from other areas of Australia.  This regional freedom from pests or diseases that might already be present in other locations in Australia is recognised in the risk assessment."
232 
(c) Assessment of the probability of entry, establishment and spread 
(i) Probability of entry 
2.40 The IRA describes the probability of entry as "the  probability that a quarantine pest will enter 
Australia as a result of trade in a given commodity, be distributed in a viable state to an endangered 
area, and subsequently be transferred to a suitable host."233  The probability of entry is "based on 
pathway scenarios depicting necessary steps in th e sourcing of the commodity for export, its 
processing, transport and storage, its utilization in  Australia, and the generation and disposal of 
waste."234  Each pathway is made up of several of the different importation steps identified by 
Australia. 
(ii) Importation steps and biological pathways 
2.41 The importation steps used in the IRA are an a pproximation of the trade in apples sufficient to 
estimate the proportion of fruit that will be infected/infested.235  Each importation step represents a 
point on the importation pathway along which apples will travel from the orchard in New Zealand to 
arrival in Australia.  An estimate is made of the pr oportion of apples which will be infected/infested at 
each point. 
• Importation step 1 (Imp1) represents the "proportion of [New Zealand] orchards in which 
the pest is present"; 
• Importation step 2 (Imp2) represents 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) represents 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) represents 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) represents the "propo rtion of infected or infested fruit that 
remains infected or infested [by the pest ] after routine processing procedures in the 
packing house"; 
• Importation step 5 (Imp5) represents the "proportion of clean fruit that is contaminated 
[by the pest] during processi ng in the packing house"; 
                                                      
232 Australia's IRA, Part A, p. 14. 
233 Australia's IRA, Part B, p. 17. 
234 Ibid. 
235 Australia's IRA, Part B, p. 21.  WT/DS367/R 
 Page 25 
 
 
 • Importation step 6 (Imp6) represents the "propo rtion 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) represents the "proportion of clean fruit that is contaminated 
[by the pest] during palletization, quality insp ection, containerization and transportation" 
to Australia; 
• Importation step 8 (Imp8) represents the "propo rtion of infected or infested fruit that 
remains infected or infested  [by the pest] after on-arrival minimum border procedures for 
the unrestricted analyses".236 
  
 2.42 The IRA describes how different combinations  of importation steps represent a biological 
pathway "or ordered sequence of steps undertaken in sourcing, processing a nd exporting a commodity 
up to the point where it is released from quarantine by the importing country".
237  This is also referred 
to as an importation scenario.238  In each importation scenario, the initiating step "is the sourcing of 
apples from orchards in New Zealand and the end-point  is the arrival in Australia of infected or 
infested fruit or packaging materials."239  Since the pathways include the possibility for contamination 
of clean fruit, the importation scenario is not a simple sequence from importation steps 1 to 8.240 
2.43 Figure 1 of Part B of the IRA illustrates various import scenarios.241  Table 4 of Part B of the 
IRA outlines step-by-step the ten different  pathways considered for each pest.242  The probability that 
an imported apple will be infected or infested  having followed a certain pathway was obtained by 
multiplying the probabilities associated with each im portation step in that pathway.  The overall 
probability that an imported apple is infected or in fested when it arrives in Australia (probability of 
importation) is the sum of the proportions (or probabi lities) associated with each of the ten individual 
pathways.243 
2.44 Once the probability of importation was estimat ed, the IRA establishes the likelihood that 
major handlers and users of apples (utility points) w ould be located sufficiently close to pest hosts 
(exposure groups) for transfer of pests from apples to host plants to take place (proximity).  The IRA 
identifies and quantifies different pathways of di stribution, utilization, and waste generation and 
disposal, illustrated in Figure 2 of Part B of the IRA.244  Each of these distribution pathways includes 
several utility points (orchard wholesalers;  ur ban wholesalers;  retailers;  food services;  and 
consumers) at which apples are distributed or u tilized and where waste will be generated.  The 
characteristics of these utility points have different  implications for the likelihood of exposure.245 
2.45 Exposure is the likelihood of transfer of a p est from an infected or  infested apple to a 
susceptible host plant.  The IRA analyses the key steps that are required for successful exposure, 
including viability of the pest, survival, transfer  mechanism(s), host recep tivity and environmental 
                                                      
236 Australia's IRA, Part B, p. 21 .  See also Australia's first written submission, para. 95. 
237 Australia's IRA, Part B, p. 19. 
238 Ibid. 
239 Ibid. 
240 Ibid. 
241 Australia's IRA, Part B, p. 20. 
242 Australia's IRA, Part B, p. 24. 
243 Australia's IRA, Part B, p. 23. 
244 Australia's IRA, Part B, pp. 25-26;  Au stralia's first written s ubmission, para. 100. 
245 Australia's IRA, Part B, p. 25;  Aust ralia's first written submission, para. 101. WT/DS367/R 
Page 26  
 
 factors.
246  It then categorizes susceptible host plants in Australia into different exposure groups for 
which the likelihoods of exposure and the impact of a pest are different.  The exposure groups are:  
susceptible commercial fruit crops;  susceptible nur sery plants;  susceptible household and garden 
plants, including weed species;  and susceptible wild and amenity plants.247 
2.46 The IRA's assessment is based on a projected vol ume of trade in New Zealand apples for one 
year, taking into account that apples might be impor ted in packed cartons for table consumption, but 
also in bulk bins for repacking or for processing in to fruit juices or other products.  Australia assumed 
that the volume of apple imports from New Z ealand would be between 50 million and 400 million 
apples per year, with a most likely value of 150 m illion.  These values equate to approximately 5 per 
cent, 40 per cent and 15 per cent of  domestic fresh fruit, or 2.5 per cent, 20 per cent and 7.5 per cent 
of Australia's total average apple production, respectively.248 
(iii) Probability of establishment and spread 
2.47 The IRA describes the probability of estab lishment and spread as encompassing the 
"biological factors associated with the likelihood that a pest will successfully propagate on or in 
[a suitable] host, and disperse from there to other populations of susceptible hosts."249  T h i s  
probability "is obtained from an examination of biologic factors associated with compatibility of the 
host and environment, and the availability  of necessary mechanisms for dispersal."250  Its calculation 
"involves examination of the factors relevant to the successful colonisation of  a susceptible host, and 
to the subsequent establishment and spread w ithin the larger population of susceptible hosts."251 
2.48 In analysing the probability of establishment, the IRA compares the following factors in the 
source country and in the PRA area for each exposure group: 
• Availability of suitable hosts, alternate hosts and vectors in the PRA area; 
• suitability of the environment; 
• cultural practices and control measures;  and, 
• other characteristics of the pest aff ecting the probability of establishment.252 
2.49 For each exposure group, the IRA also derives the probability of spread by comparing the 
following factors in the source country and in the PRA area: 
• Suitability of the natural and/or managed e nvironment for natural spread of the pest; 
• presence of natural barriers; 
                                                      
246 Australia's IRA, Part B, p. 27. 
247 Australia's IRA, Part B, pp. 28-29. 
248 Australia's IRA, Part B, pp. 17-19.  See also Australia's first written submission, paras. 98-99.  
New Zealand has contested these estimates.  In New Zeal and's view, the most likely value of 150 million apples 
per year estimated by Australia "bears no relationship to the reality of likely Australian demand for 
New Zealand apples or New Zealand's capacity to  supply that demand".  New Zealand's first written 
submission, para. 4.196.  According to New Zealand, "the lower value on Australia's range, 50 million apples per annum, is in fact the 'most likely' value".  New Zealand's second written submission, para. 2.360. 
249 Australia's IRA, Part B, p. 17. 
250 Ibid. 
251 Australia's IRA, Part B, p. 29. 
252 Australia's IRA, Part B, p. 30.  WT/DS367/R 
 Page 27 
 
 
 • potential for movement with commodities or conveyances; 
• intended use of the commodity; 
• potential vectors of the pest in the PRA area;  and, 
• potential natural enemies of the pest in the PRA area.253 
2.50 For arthropod pests, including apple leafcur ling midge, the IRA used a slightly different 
methodology to take into account that the midge is a flying insect, which has implications for spread, 
distribution and establishment.254 
2.51 After obtaining the "partial" probabilities for each exposure group, the IRA calculates the 
overall annual probability of entry, establishment and spread of each pest.255 
(d) Assessment of consequences 
2.52 In assessing the consequences for potential pests imported on New Zealand apples, the IRA 
conducts separate assessments for ea ch pest.  These are carried out in two steps.  First, the IRA 
evaluates the "magnitude of impact of a pest  on each of the direct and indirect criteria".256  Second, 
the IRA combines the "magnitude of impact obtained for each of the direct and indirect criteria ... to 
give an overall (qualitative) estimate of the consequences of establishment or spread."257 
2.53 Referring to ISPM No. 11, the IRA cites the following examples of criteria in assessing the 
direct consequences of a pest. 
• Criteria that could be considered for the di rect consequences on plant life or health:  
known or potential host plants;  types, amount and frequency of damage;  crop losses, in 
yield and quality;  biotic factors (e.g., adapta bility and virulence of the pest) affecting 
damage and losses;  abiotic factors (e.g., climate) affecting damage and losses;  rate of 
spread;  rate of reproduction;  control measures (including existing measures), their efficacy and cost;  effect of existing produc tion practices;  and, environmental effects. 
• Human life or health, as a factor that is not directly relevant, but may need to be 
considered as part of a comprehensive risk analysis of the proposed import. 
• Other aspects of environmental effects:  reduc tion of keystone plant species;  reduction of 
plant species that are major components of ecosystems and endangered native plant 
species;  significant reduction, displacement or elimination of other plant species.
 258 
2.54 The IRA defines "indirect criteria" or "indirect consequences" as "the costs resulting from 
natural or human processes associated with the incursion of a pest."259  Referring to ISPM No. 11, the 
IRA cites the following examples. 
                                                      
253 Australia's IRA, Part B, p. 31. 
254 Australia's IRA, Part B, pp. 24, 33-35;  Australia's first written submission, para. 105. 
255 Australia's IRA, Part B, pp. 31-33. 
256 Australia's IRA, Part B, p. 39. 
257 Ibid.  
258 Australia's IRA, Part B, p. 36. 
259 Ibid. WT/DS367/R 
Page 28  
 
 • Indirect consequences on eradication, control,  etc.:  changes to producer costs or input 
demands, including control costs;  feasibility and costs of eradication or containment;  
capacity of the pest to act as a vector for othe r pests;  and resources needed for additional 
research and advice. 
• Indirect consequences on domestic and international trade:  effects on domestic and 
export markets, including particular effect s on export market access;  and changes to 
domestic or foreign consumer demand for a product resulting from quality changes. 
• Indirect consequences on the environment:  e nvironmental and other undesired effects of 
control measures;  social and other effects;  significant effects on plant communities;  significant effects on designated environmenta lly sensitive or protected areas;  significant 
change in ecological processes and the structur e, stability or processes of an ecosystem;  
and costs of environmental restoration. 
• Indirect consequences on communities.
260 
2.55 The IRA estimates the effect of pests on the dir ect and indirect consequences criteria at four 
levels:  local;  district;  regional;  and national.261  The values derived were translated into qualitative 
scores:  unlikely to be discernible;  of minor significance;  significant; or highly significant.262  After 
obtaining an impact score for each direct and indir ect criterion, the IRA Team determined whether the 
overall consequences of a pest incursion were consider ed negligible, very low, low, moderate, high, or 
extreme.263 
(e) Unrestricted risk 
2.56 The IRA presents an estimate of unrestricted ri sk by combining the probabilities of entry, 
establishment and spread with the consequences ass essments for pests entering via apples.  The IRA 
defines unrestricted risk as the "unrestricted annual risk associated with ea ch pest if apples were 
imported from New Zealand for 12 months without phytosanitary measures."264 
2.57 Probabilities and consequences are combined usi ng the risk estimation matrix contained in 
Table 11 of Part B of the IRA.265  The vertical axis of this matrix refers to likelihood266 of entry, 
establishment and spread;  the horizontal axis refers to consequences;  and the cells of this matrix 
describe the product of likelihood and consequences, or risk, in qualitative terms.  For example, a high 
likelihood of entry, estab lishment and spread combined with negligible consequences results in 
negligible risk;  a low probability of entry, establis hment and spread combined with low consequences 
result in very low risk;  and a negligible likelihoo d of entry, establishment and spread combined with 
extreme consequences also results in very low risk. 
3. Risk management measures and Australia's appropriate level of protection 
2.58 Following the assessment of the unrestricted risk for each pest of quarantine concern, the IRA 
deals with pest risk management, which is "the  process of identifying and implementing measures to 
mitigate risks so as to achieve Australia's appropria te level of protection (ALOP), or tolerance for 
                                                      
260 Australia's IRA, Part B, p. 37. 
261 Australia's IRA, Part B, p. 38.  See also Australia's first written submission, para. 111. 
262 Australia's IRA, Part B, pp. 38-39.  See also  Australia's first written submission, para. 112. 
263 Australia's IRA, Part B, pp. 39-40.  See also  Australia's first written submission, para. 113. 
264 Australia's IRA, Part B, p. 40. 
265 Australia's IRA, Part B, pp. 4 and 41.  See also Australia's first written submission, para. 114. 
266 The terms "probability" and "likelihood" are used interchangeably.  WT/DS367/R 
 Page 29 
 
 
 loss, while ensuring that any negative effects on trade are minimised."267  In determining whether risk 
management measures are required, the IRA compares the unrestricted risk associated with each pest 
to its ALOP.  When the unrestricted risk of a pest  was found to exceed the ALOP, the IRA concludes 
that measures are required.  The risk assessment process described above was also used by the IRA to 
assess the effect of potential risk management measures.268 
2.59 Australia's ALOP is expressed in the IRA as "providing a high level of sanitary or 
phytosanitary protection aimed at reducing risk to a very low level, but not zero".269  This ALOP is 
not specific to apples imported from New Zealand;  it is rather part of Australia's general biosecurity 
policy.270  Using the risk estimation matrix, any combination of the likelihood of entry, establishment 
and spread and consequences that resulted in "neg ligible" or "very low" risk was found to meet 
Australia's ALOP and was considered acceptable.  In  such a situation, risk management measures 
would not be justified.  If, however, the unrestricted risk was "low", "moderate", "high" or "extreme", 
it would be found to exceed Australia's ALOP and risk management measures were required.271 
2.60 The specific risk management measures that are at issue in this dispute will be discussed in 
detail below. 
4. The IRA's semi-quantitative approach 
2.61 As indicated above, the IRA uses a semi-quan titative approach to assess  the risk associated 
with the three pests at issue in th is dispute.  For some of the othe r pests evaluated in the same IRA, 
Australia applied a qualitative approach.  The IRA states: 
"Like most quarantine agencies, Biosecurity Australia generally undertakes pest risk 
analyses using a qualitative approach where the likelihoods of various events are 
considered and evaluated using descriptiv e terms that are linked to probability 
intervals".272 
2.62 However, "in responding to issues raised by some  stakeholders", Biosecurity Australia used a 
semi-quantitative approach for the 2004 draft version of the IRA, "to reinforce the transparency and 
objectivity of the analysis wherever possible".273   The final version of the IRA maintains this 
approach, with some adjustments. 
2.63 According to Australia, the semi-quantitative approach in the IRA combines a quantitative 
estimation of the probability of entry, establishment and spread of a pest with a qualitative evaluation 
of the consequences.274  The IRA assigns a probability range and mathematical distribution on a per 
apple basis for each importation step of the importation scenario and the different pathways of distribution, utilization, waste generation and disposal of apples in Australia.
275  F o r  s o m e  i n p u t  
values, a point value (e.g., a probability of 1, or 100 per cent) was used.   
                                                      
267 Australia's IRA, Part B, p. 41. 
268 Ibid. 
269 Australia's IRA, Part B, p. 4.  See also, Australia's IRA, Part A, p. 3. 
270 Import risk analysis handbook  (Canberra, 2003) in Exhibit AUS-10 , p. 5.  Australia's first written 
submission, para. 20. 
271 Australia's IRA, Part B, p. 41.  See also, Austra lia's IRA, Part A, p. 7.  Australia's first written 
submission, para. 116. 
272 Australia's IRA, Part B, p. 11. 
273 Ibid. 
274 Australia's first written submission, paras. 90 and 110. 
275 Australia's first written submission, paras. 90-92;  New Zealand's first written submission, 
para 4.171. WT/DS367/R 
Page 30  
 
 2.64 The probabilities were then combined with the projected volume of imports of apples from 
New Zealand in a computer programme called @Ris k (Palisade Corporation, 2007), to provide an 
estimate of the overall probability of entry,  establishment and spread for each pest.
276  A Monte Carlo 
stochastic (random) simulation model was used w ith @Risk, based on random sampling from the set 
of values.277  The @Risk software selected a number from within each probability range, taking into 
account the shape of the range,  to represent the likeli hood of an event occurring;  it did this thousands 
of times to produce an output in the form of a dist ribution 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 Final IRA Report.
278 
2.65 In most cases, the IRA Team chose one of a set  of probability ranges suggested in Biosecurity 
Australia's 2001 draft Guidelines for import risk analysis279, although the IRA Team was not 
constrained by these pre-defined ranges.280  Table 12 of Part B of the IRA sets out the "[n]omenclature 
for qualitative likelihoods, corresponding sem i-quantitative probability intervals".281  For example, 
this table shows that a "negligible" likelihood co rresponds to the qualitative descriptor "[t]he event 
would almost certainly not occur", a probability interval of 0 to 10-6 (zero to one in one million), and a 
midpoint (if uniform distribution used) of 5 x 10-7 (0.5 in one million, or one in two million).  
Table 13 of Part B of the IRA provides "[a] matr ix of rules for combinin g descriptive likelihoods".282 
2.66 The IRA Team used uniform, triangular and Pert probability distributions.283  A uniform 
distribution has a minimum and a maximum value.  Any value contained in the range between the minimum and maximum values occurs with equal probability.  The IRA states that a uniform 
distribution was used where insufficient information w as available to determine the most likely value.  
A triangular distribution has a minimum, maximum and a most likely value.  It is not necessarily 
symmetric, but can be skewed.  According to the IR A, this distribution was used when information 
(such as literature and expert opinion) on the most li kely value was available.  The Pert distribution 
also has three parameters:  a minimum value, a ma ximum value, and a most likely value, but it has a 
different, more rounded shape than a triangular distri bution.  The Pert distribution was used in the 
IRA to estimate the volume of apples likely to be imported.
 284 
2.67 The IRA notes that the IRA Team "considered caref ully whether they were confident that the 
range they had chosen would contain the actual valu e and that the chosen distribution reflected their 
beliefs".285  The IRA additionally states that values were chosen "taking into account relevant 
scientific information and expert opinion".286  The IRA Team appears to have worked by consensus, 
although Appendix 1 of the IRA on the involvement of  the Bureau of Rural Sciences in the IRA 
process states that the "issue of expressing dive rgent opinions was also discussed and different 
approaches to handling diverg ence of opinion were canvassed".287 
                                                      
276 Australia's first written submission, paras. 90 and 106;  New Zealand's first written submission, 
paras. 4.168-4.169. 
277 Australia's first written submission, para. 90 and footnote 96. 
278 Australia's IRA, Part B, pp. 43-44;  New Zealand's first written submission, para. 4.190;  
Compilation of experts replies, paras. 787-789. 
279 Guidelines for import risk analysis , Draft September 2001 (Canberra, Australia, Agriculture, 
Fisheries and Forestry) in Exhibit AUS-17 . 
280 Australia's IRA, Part B, p. 42. 
281 Australia's IRA, Part B, p. 43. 
282 Ibid.  Australia's first written submission, para. 115. 
283 Australia's first written submission, paras. 93-94 and 99. 
284 Australia's IRA, Part B, p. 42. 
285 Ibid. 
286 Australia's IRA, Part B, p. 44. 
287 New Zealand's first written subm ission, para. 4.468;  Australia's IRA, Part B, p. 332.  WT/DS367/R 
 Page 31 
 
 
 C. RELEVANT INTERNATIONAL STANDARDS , GUIDELINES AND RECOMMENDATIONS  
2.68 A number of provisions of the SPS Agreement ma ke reference to "international standards, 
guidelines and recommendations".  Annex A:3(c) of the SPS Agreement indicates that for plant health, the relevant international standards, guidelines and recommendations are those developed 
under the auspices of the Secretariat of the Inte rnational Plant Protection Convention (IPPC) in 
cooperation with regional orga nizations operating within the framework of the IPPC. 
1. The IPPC 
2.69 The IPPC is an international treaty to secure action to prevent the spread and introduction of 
pests of plants and plant products, and to promote appropriate measures for their control.  It is 
governed by the Commission on Phytosanitary Measu res (CPM) which adopts International Standards 
for Phytosanitary Measures (ISPMs).  The Conventi on has been deposited with the Director-General 
of the Food and Agriculture Organization of the Un ited Nations (FAO) since its initial adoption by the 
Conference of FAO at its Sixth Session in 1951.  The New Revised Text of the IPPC was approved in 1997.  It entered into force on 2 October 2005.
288  Both Australia and New Zealand have signed and 
ratified the International Plant Protection Conven tion and are Contracting Parties to the IPPC. 
(a) IPPC standards on risk analysis:  ISPM No. 2 and ISPM No. 11 
2.70 In the context of their arguments on risk assessment, the Parties refer to ISPM No. 2, 
Guidelines for pest risk analysis , adopted in 1995 and revised in 2007 and renamed as Framework for 
pest risk analysis ;  and ISPM No. 11 on pest risk analysis  for quarantine pests, adopted in 2001 and 
revised in 2003 and 2004.289 
2.71 ISPM No. 2 provides general guidance for pest risk analysis (PRA), whereas ISPM No. 11 
establishes guidelines for conducting a risk analysis for quarantine  pests.290  The two standards are 
related and present the same general framework for conducting a pest risk assessment, consisting of 
three stages:  (i) initiation;  (ii) pest risk assessme nt;  and (iii) pest risk management.  ISPM No. 2 
provides detailed guidance on PRA stage one (i nitiation), summarizes PRA stages two (risk 
assessment) and three (risk management), and addresses issues generic to the entire PRA process.  
ISPM No. 11 addresses stages two and three in more detail for quarantine pests. 
2.72 The aim of stage one, the initiation stage, is to identify the pest(s) and pathways which are of 
concern and should be considered for risk analysis in relation to the identified PRA area.  Stage two 
(risk assessment) begins with the categorization of individual pests to determine whether the criteria 
for a quarantine pest are satisfied, and continues with  an evaluation of the probability of pest entry, 
establishment, and spread, and of their potentia l economic consequences.  Stage three (risk 
management) involves identifying management options for reducing the risks identified at stage two.  
These are evaluated for efficacy, feasibility and impact  in order to select those that are appropriate. 
2.73 According to ISPM No. 11, the pest risk assess ment process can be broadly divided into three 
interrelated steps:  (i) pest categorization;  ( ii) assessment of the probability of introduction and 
spread;  and, (iii) assessment of potential economic  consequences (including environmental impact).  
                                                      
288 International Phytosanitary Portal (IPP), http s://www.ippc.int/IPP/En/default.jsp, consulted on 
22 July 2009. 
289 Framework for pest risk analysis , 2007 (ISPM No. 2, FAO, Rome);  and Pest risk analysis for 
quarantine pests, including analysis of environmental risks and living modified organisms , 2004 (ISPM No. 11, 
FAO, Rome, submitted as Exhibit AUS-6). 
290 The IPPC defines a quarantine pest as:  "[a] pest of potential economic importance to the area 
endangered thereby and not yet present there, or present but not widely distributed and being officially 
controlled."  Glossary of phytosanitary terms , 2009 (ISPM No. 5, FAO, Rome). WT/DS367/R 
Page 32  
 
 Pest introduction is composed of both entry and establishment.  Assessing the probability of 
introduction requires an analysis of each of the path ways with which a pest may be associated from its 
origin to its establishment in the PRA area.  I PSM 11 identifies the following broad issues which 
should be considered when evaluating the proba bility of introduction and spread, and provides 
detailed guidance under each heading: 
(a) Probability of the pest being associat ed with the pathway at origin; 
(b) probability of survival during transport or storage; 
(c) probability of pest surviving existing pest management procedures; 
(d) probability of transfer to a suitable host; 
(e) probability of establishment; 
(f) availability of suitable hosts, alternate hosts and vectors in the PRA area; 
(g) suitability of environment; 
(h) cultural practices and control measures; 
(i) other characteristics of the pest affectin g the probability of establishment;  and, 
(j) probability of spread after establishment. 
2.74 ISPM No. 11 recognizes that the estimation of the probability of introduction of a pest and of 
its economic consequences involves many uncertainti es since it is an extrapolation from the situation 
where the pest occurs to the hypothetical situation in the PRA area.  It emphasizes the importance of 
documenting the areas of uncertainty and the degree of uncertainty in the assessment, and to indicate 
where expert judgement has been used, since this is  necessary for transparency and may also be useful 
for identifying and prioritizing research needs. 
2.75 The conclusions from pest risk assessment are us ed to decide whether risk management is 
required and the strength of measures to be used.  ISPM No. 11 recognizes that zero-risk is not a 
reasonable option.  The guiding principle for risk management should be to manage risk to achieve 
the required degree of safety that can be justified and is feasible within the limits of available options 
and resources.  According to this standard, pest risk management (in the analytical sense) is the 
process of identifying ways to react to a perceive d risk, evaluating their efficacy, and identifying the 
most appropriate options.  The uncertainty noted  in the assessments of economic consequences and 
probability of introduction should al so be considered and included in the selection of a pest 
management option.  The ISPM lists examples of me asures classified into broad categories that relate 
to the pest status of the pathway in the country of origin.  These include measures: 
(a) Applied to the consignment; 
(b) applied to prevent or reduce original infestation in the crop; 
(c) to ensure the area or place or site of production or crop is free from the pest; 
(d) for other types of pathways (such as to curb natural spread); 
(e) within the importing country;  WT/DS367/R 
 Page 33 
 
 
 (f) concerning the prohibition of commodities;  and, 
(g) phytosanitary certificates and other compliance measures. 
2.76 According to ISPM No. 11, the whole PRA proc ess 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 ma nagement decision can be clearly demonstrated. 
(b) IPPC standards on pest free areas and areas of low pest prevalence:  ISPM No. 4, ISPM 
No. 10 and ISPM No. 22 
2.77 In the context of discussions on pest free areas and areas of low pest prevalence, the Parties 
have referred to:  ISPM No. 4, Requirements for the establis hment of pest free areas ;  ISPM No. 10, 
Requirements for the establishment of pest free pl aces of production and pest free production sites ;  
and ISPM No. 22, Requirements for the establishment of areas of low pest prevalence .291 
2.78 The IPPC defines a "pest free area" (PFA) as "[a]n area in which a specific pest does not 
occur as demonstrated by scientific evidence and in which, where appropriate, this condition is being 
officially maintained".292  According to ISPM No. 4, the estab lishment and use of a PFA by a national 
plant protection organization provides for the expor t of plants, plant products and other regulated 
articles from the exporting country to the importing country without the need for application of 
additional phytosanitary measures when certain requireme nts are met.  Thus, the pest free status of an 
area may be used as the basis for the phytosanitary certification of plants, plant products and other 
regulated articles with respect to the stated pest(s).   It also provides, as an element in pest risk 
assessment, the confirmation on a scientific basis of the absence of a stated p est from an area.  The 
PFA is then an element in the justification of ph ytosanitary measures taken by an importing country to 
protect an endangered area. 
2.79 Although the term "pest free areas" encompasses a whole range of types (from an entire 
country which is pest free to a small area which is p est free but situated in a country where that pest is 
prevalent), it has been found to be convenient to discuss the requirements of PFAs by defining three 
categories:  an entire country;  an uninfested part of a country in which a limited infested area is 
present;  an uninfested part of a country situated with in a generally infested area.  In each of these 
cases, the PFA may, as appropriate, concern all or part of several countries. 
2.80 A pest free place of production is defined as a "[p]lace of production in which a specific pest 
does not occur as demonstrated by scientific evidence and in which, where appropriate, this condition 
is being officially maintained for a defined period".293  A pest free production site is "[a] defined 
portion of a place of production in which a specific pest does not occur as demonstrated by scientific 
evidence and in which, where appropriate, this cond ition is being officially maintained for a defined 
period and that is managed as a separate unit in the same way as a pest free place of production".294 
2.81 ISPM No. 10 uses the concept of "pest freedom " to allow exporting countries to provide 
assurance to importing countries that plants, plant pro ducts and other regulated articles are free from a 
                                                      
291 Requirements for the establishment of pest free areas,  1996 (ISPM No. 4, FAO, Rome);  
Requirements for the establishment of pest free places of production and pest free production sites, 1999 (ISPM 
No. 10, FAO, Rome);  Requirements for the establishment of areas of low pest prevalence,  2005 (ISPM No. 22, 
FAO, Rome).  The descriptions of each standard in th is section closely follow the "Outline of Requirements" 
which appears at the beginning of each ISPM. 
292 Glossary of phytosanitary terms , 2009 (ISPM No. 5, FAO, Rome, 2008 version of ISPM No. 5 
submitted as Exhibit AUS-164), p. 12. 
293 Ibid. 
294 Ibid. WT/DS367/R 
Page 34  
 
 specific pest or pests and meet the phytosanita ry requirements of the importing country when 
imported from a pest free place of production.  In circumstances where a defined portion of a place of production is managed as a separate unit and can be main tained pest free, it may be regarded as a pest 
free production site.  The use of pest free places  of production or pest free production sites is 
dependent on the use of criteria concerning the biology  of the pest, the characteristics of the place of 
production, the operational capabilities of the producer , and the requirements and responsibilities of 
the national plant protection organization. 
2.82 Similar to the requirements for PFAs stated  in ISPM No. 4, requirements for the 
establishment and maintenance of a pest free place of production or a pest free production site as a 
phytosanitary measure by the national plant protec tion organization set out in ISPM No. 10 include: 
• Systems to establish pest freedom; 
• systems to maintain pest freedom; 
• verification that pest freedom has been attained or maintained;  and, 
• product identity, consignment integrity and phytosanitary security. 
Where necessary, a pest free place of production or a pest free production site also includes the 
establishment and maintenance of an appropriate buffer zone. 
2.83 Administrative activities required to support a pest free place of production or pest free 
production site involve documentation of the syst em and the maintenance of adequate records 
concerning the measures taken.  Review and a udit procedures undertaken by the national plant 
protection organization are essential to support assuran ce of pest freedom and for system appraisal.  
Bilateral agreements or arrangements may also be needed. 
2.84 The concept of the pest free place of production is distinct from that of the PFA.  The PFA 
has the same objective as the pest free place of production but is implemented in a different way.  Every distinction between a pest free place of pr oduction and a PFA applies equally to a pest free 
production site.  A PFA is much larger than a place of production, includes many places of production 
and may extend to a whole country or parts of several  countries.  A PFA may be isolated by a natural 
barrier or an appropriate buffer zone.  A PFA is  generally maintained over many years without 
interruption, whereas the status of  a pest free place of production may be maintained for only one or a 
few growing seasons.  A PFA is managed as a whole,  by the national plant protection organization 
(NPPO) of the exporting country, i.e., the official se rvice established by the government to discharge 
the functions specified by the IPPC.  A pest free place of production is managed individually by the 
producer, under the supervision and responsibility of the NPPO.  If the pest is found in a PFA, the 
status of the whole area is called into question.  If it is found in a pest free place of production, that 
place loses its status but other places of production in the area operating the same system are not 
directly affected.  These distinctions may not alwa ys apply in particular cases.  A place of production 
lying in a PFA may satisfy, by that fact, the requi rements for a pest free place of production, although 
the importing country may require verification. 
2.85 According to ISPM No. 22, the establishment of  an area of low pest prevalence is a pest 
management option used to maintain or reduce a pe st population below a specified level in an area.  
An area of low pest prevalence may be used to facilit ate exports or to limit pest impact in the area.  A 
specified low pest level should be determined ta king into consideration the overall operational and 
economic feasibility of establishing a programme to meet  or maintain this level, and the objective for 
which an ALPP is to be established.  WT/DS367/R 
 Page 35 
 
 
 2.86 In determining an area of low pest prevalence,  a national plant protection organization should 
describe the area involved.  Areas of low pest pr evalence may be established and maintained for 
regulated pests or for pests regulated by an importing country only. 
2.87 Surveillance of the relevant pest should be conducted according to appropriate protocols. 
Additional phytosanitary procedures may be required to  establish and maintain an area of low pest 
prevalence.  Once established, the area of low pest prevalence should be maintained by the 
continuation of the measures used for its est ablishment and the necessary documentation and 
verification procedures.  In most cases an offi cial operational plan which specifies the required 
phytosanitary procedures is needed.  If there is a change in the status of the area of low pest 
prevalence, a corrective action plan should be initiated. 
(c) Other ISPMs 
2.88 The Parties also refer to ISPM No. 1, Phytosan itary principles for the protection of plants and 
the application of phytosanitary measures in internat ional trade;  ISPM No. 14, The use of integrated 
measures in a systems approach for pest risk  management;  ISPM No. 20, Guidelines for a 
phytosanitary import regulatory system;  ISPM No. 23, Guidelines for inspection;  and ISPM No. 31, 
Methodologies for sampling of consignments.  ISPM  No. 5 contains the Glossary of phytosanitary 
terms.295 
2.89 In addition, the Parties refer to the IPPC's  Participant Manual for Pest Risk Analysis 
Training.296  The manual was developed as a basic introduction to pest risk assessment for biological 
scientists, plant pest risk assessors, plant pest risk  analysts and phytosanitary policy makers working 
in the field of international phytosanitary regula tion.  The material in the manual explains the 
international context for pest risk assessment a nd outlines the pertinent international standards and 
resources available for pest risk assessment, pest ri sk management and pest risk communication.  The 
Manual itself, however, is not an interna tional standard, guideline or recommendation. 
D. MEASURES AT ISSUE  
1. The measures at issue are limited to 17 specific measures 
2.90 As explained above297, on 6 June 2008 the Panel issued a preliminary ruling298 in response to 
Australia's request regarding the consistency of Ne w Zealand's panel request with Article 6.2 of the 
DSU.  In its ruling, the Panel reviewed inter alia whether New Zealand's panel request had identified 
the measures at issue in a manner consistent with  the requirements of Article 6.2 of the DSU.  
The Panel found that "its terms of reference are li mited to the 17 measures specifically identified by 
New Zealand in its panel request [by bullet points]  and do not encompass other measures that may be 
                                                      
295 Phytosanitary principles for the protection of plants and the application of phytosanitary measures 
in international trade, 2006 (ISPM No. 1, FAO, Rome);  Glossary of phytosanitary terms , 2009 (ISPM No. 5, 
FAO, Rome, 2008 version of ISPM No. 5 submitted as Exhibit AUS-164);  The use of integrated measures in a 
systems approach for pe st risk management,  2002 (ISPM No. 14, FAO, Rome, submitted as Exhibit AUS-14);  
Guidelines for a phytosanitary import regulatory system, 2004 (ISPM No. 20, FAO, Rome, submitted as Exhibit 
AUS-170);  Guidelines for inspection, 2005 (ISPM No. 23, FAO, Rome);  Methodologies for sampling of 
consignments , 2008 (ISPM No. 31, FAO, Rome , submitted as Exhibit AUS-30). 
296 Pest Risk Analysis Training Participant Manual , 2007 (FAO, Rome).  Page 37 of this document has 
been submitted as Exhibit NZ-95;  Pp . 1, 36 and 37 as Exhibit AUS-16. 
297 See para. 1.10 above. 
298 As explained above (see para. 1.10 above), the pr eliminary ruling was made publicly available on 
23 June 2008.  Australia – Apples , Communication from the Chairman of th e Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report. WT/DS367/R 
Page 36  
 
 contained in Australia's FIRA , but which were not identified with sufficient precision in the panel 
request."
299 
2. The 17 specific measures and their relationship to the three pests at issue 
2.91 The 17 specific measures identified by bullet point s in New Zealand's panel request fall into 
four categories according to their relationship to the three pests relevant for this dispute.  For ease of 
reference, the Panel has chosen to number these 17 measures consecutively, in the order that they 
appear in the bullet point list in New Zealand's panel request: 
(a) Measures 1-8, addressed in the first eight bullet points of New Zealand's panel 
request, relate to " fire blight ":300 
(i) "The requirement that apples be sourced from areas free from fire blight 
disease symptoms."301 
(ii) "The requirement that orchards/blocks be inspected for fire blight disease 
symptoms, including that they be inspect ed at an inspection intensity that 
would, at a 95% confidence level, detect visual symptoms if shown by 1% of the trees, and that such inspections take place between 4 to 7 weeks after 
flowering."
302 
(iii) "The requirement that an orchard/block inspection methodology be 
developed and approved that addresses i ssues such as visibility of symptoms 
in the tops of trees, the inspection tim e needed and the number of trees to be 
inspected to meet the efficacy level, and training and certification of inspectors."
303 
(iv) "The requirement that an orchard/bl ock 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."304 
(v) "The requirement that an orchard/bl ock be suspended for the season on the 
basis of detection of any visual symptoms of fire blight."305 
(vi) "The requirement that apples be subj ect to disinfection treatment in the 
packing house."306 
(vii) "The requirement that all grading and p acking equipment that comes in direct 
contact with apples be cleaned and disinfected (using an approved disinfectant) immediately before each Australian packing run."
307 
                                                      
299 Australia – Apples , Communication from the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, para. 9. 
300 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Anne x A-1 to this report, p. 1. 
301 Ibid. 
302 Ibid. 
303 Ibid. 
304 Ibid. 
305 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Anne x A-1 to this report, p. 2. 
306 Ibid.  WT/DS367/R 
 Page 37 
 
 
 (viii) "The requirement that packing houses registered for export of apples process 
only fruit sourced from registered orchards."308 
(b) Measures 9-13, addressed in the subsequent five bullet points of New Zealand's panel 
request, relate to " European canker ":309 
(ix) "The requirement that apples be sour ced from export orchards/blocks free of 
European canker (pest free places of production)."310 
(x) "The requirement that all trees in expo rt orchards/blocks be inspected for 
symptoms of European canker, includi ng that orchards/blocks in areas less 
conducive for disease are 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."311 
(xi) "The requirement that all new planti ng stock be intensively examined and 
treated for European canker."312 
(xii) "The requirement that an orchard/bl ock 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."313 
(xiii) "The requirement that exports from an  orchard/block be suspended for the 
coming season on the basis of detec tion of European canker and that 
reinstatement would require eradi cation of the disease, confirmed by 
inspection."314 
(c) Measure 14, addressed in the subsequent bu llet point of New Zealand's panel request, 
relates to " apple leafcurling midge ":315 
(xiv) "The requirements of inspection and tr eatment for apple leafcurling midge, 
including: 
the option of inspection of each lot on the basis of a 3000 
unit sample selected at random across the whole lot for apple leafcurling midge, symptoms of quarantineable diseases, quarantineable pests, arthropods, trash and weed 
seeds, with detection of any live quarantineable arthropod 
resulting in appropriate treatment or rejection for export; 
                                                                                                                                                                    
 
307 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Anne x A-1 to this report, p. 2. 
308 Ibid. 
309 Ibid. 
310 Ibid. 
311 Ibid. 
312 Ibid. 
313 Ibid. 
314 Ibid. 
315 Ibid. WT/DS367/R 
Page 38  
 
 the option of 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, plus mandatory appropriate treatment of all lots."
 316 
(d) Measures 15-17, addressed in the last thr ee bullet points of New Zealand's panel 
request, were described by New Zealand as " general "317 measures:  
(xv) "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."
318 
(xvi) "The requirement that New Zealand ensure that all orchards registered for 
export to Australia operate under standard commercial practices."319 
(xvii)  "The requirement that packing hou ses provide details of the layout of 
premises."320 
2.92 In its first written submission, New Zealand expl ains that Measures 15-17, i.e. the "general" 
measures are "applicable to all three pests (fire  blight, European canker and apple leafcurling 
midge)."321  Australia agrees, and notes that "these [gen eral] requirements are also relevant to the 
other pests examined in the Final IRA Report whic h [however] are not at issue in this dispute."322 
2.93 In their responses to the Panel's questions after the first substantive meeting, the Parties 
confirm that they consider that each of Measures 15,  16 and 17 as a whole relates to all three pests at 
issue.323  At the same time, the Parties adopt a more nuanced approach as regards how the various 
elements of Measure 15 relate to those three pests.  New Zealand argues that some of the elements of 
Measure 15 relate to only some and not all of the three pests: 
"Australia indicated that [M]easure 15 is an cillary to the inspections for fire blight 
and European canker, and the orchard in spection component of the measure only 
relates to those two diseases.  New Zealand understands that 'direct verification of 
packing house procedures' primarily relates to chlorine dipping and disinfection of 
machinery as part of the fire blight management system but, as fruit inspection is also carried out in the packing house, 'direct verification of packing house procedures' 
may also therefore apply to all three pest s.  New Zealand understands that 'fruit 
inspection' applies to all three pests and to any other quarantine pest that may be 
present (see measure 14).  New Zealand assumes that 'treatment' refers only to any 
fumigation that may be necessary for ALCM as a result of detecting ALCM during 
the 3000 fruit inspection or routinely after the 600 fruit inspection.  However, 
                                                     
 
316 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as A nnex A-1 to this report, p. 2 . 
317 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Anne x A-1 to this report, p. 3. 
318 Ibid. 
319 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Anne x A-1 to this report, p. 2. 
320 Ibid. 
321 New Zealand's first writte n submission, para. 3.82. 
322 Australia's reply to Panel question 45 after the first substantive meeting. 
323 New Zealand's reply to Panel question 44 after the first substantive meeting and Australia's reply to 
Panel question 45 after the first substantive meeting.  WT/DS367/R 
 Page 39 
 
 
 chlorine dipping is also a 'treatment' and New Zealand notes the ambiguity around the 
use of the term in this instance."324 
2.94 Likewise, Australia responds to the Panel that the various elements of Measure 15 are not 
necessarily related to all three pests at issue, alt hough Australia establishes slightly different linkages 
between the various elements of Measure 15 and the pests at issue: 
"[Measure 15] is ... aimed at verifying and operationalising the principal risk 
reduction measures set out in the Final IRA Report.  In particular, the AQIS audits of orchard inspections and packing house proce dures serve to verify that the principal 
orchard inspection and disinfection measures for fire blight and European canker are 
appropriately fulfilled.  Verification of fru it inspection processes is aimed at ensuring 
the appropriate level of efficacy is ach ieved for the principal fruit inspection 
requirements for ALCM, as well as the more general fruit inspection requirements."
325 
2.95 Although the Parties might have different views on the exact relationship of some of the 
elements of Measure 15 to some of the three pests at issue, the Panel does not consider it necessary to 
elaborate on this matter.  The Parties agree th at, through its various elements, Measure 15 has a 
linkage to all three pests, and that – similar to Measures 16 and 17 – Measure 15 as a whole relates to all three pests at issue. 
3. The Parties' agreement on Measure 12 
2.96 As explained above
326, on 19 December 2008 the Parties advised the Panel that "they have 
reached agreement on the requirement listed as the twelfth bullet point in New Zealand's panel 
request"327, i.e. Measure 12.  Further to the Parties' request328, the Panel records this agreement as 
follows: 
"The Panel noted Australia's submission th at it does not impose '[t]he requirement 
that an orchard/block be suspended for th e season on the basis that any evidence of 
pruning or other activities carried out be fore the inspection could constitute an 
attempt to remove or hide symptoms of Eu ropean canker' referred to in the twelfth 
bullet point of New Zealand's panel request .  The Panel also noted New Zealand's 
advice that, based on Australia's confirmation that it does not impose such a requirement, it will not pursue its claim in relation to the twelfth bullet point of its 
panel request.  In view of this, the Panel concluded that there was no need for it to rule on this aspect of New Zealand's claim."
329 
4. The remaining 16 specific measures at issue spelt out in the IRA 
2.97 The Parties agree that the remaining 16 specific measures at issue, namely Measures 1-11 and 
13-17, are spelt out in the IRA.  In its first wr itten submission, New Zealand links each of the 
measures to a specific part of the IRA.330  In turn, Australia refers to "the reasonable measures 
                                                      
324 New Zealand's reply to Panel question 44  after the first substantive meeting. 
325 Australia's reply to Panel question 45 after the first substantive meeting.  See also, Australia's replies 
to Panel questions after the first substantive meeting, Annex A. 
326 See para. 1.20 above. 
327 Joint Communication from New Zealand and Australia to the Panel, 19 December 2008. 
328 Ibid. 
329 Ibid. 
330 New Zealand's first writte n submission, para. 3.83. WT/DS367/R 
Page 40  
 
 recommended in the Final IRA Report"
331, and argues that "[t]he Final IRA Report provides the basis 
for Australia's measures".332  Likewise, the Panel's preliminary ruli ng refers to "the items contained in 
Australia's Final import risk analysis report for apples from New Zealand  (FIRA ) and identified by 
bullet points in New Zealand's request".333 
2.98 In addition to the IRA, New Zealand's pa nel request mentions another instrument, 
the Biosecurity Australia Policy Memorandum 2007/ 07 of 27 March 2007.  This Biosecurity 
memorandum determines that the "[i]mportation of  apples [from New Zealand] can be permitted 
subject to the Quarantine Act 1908 , and the application of phytosanitary measures as specified in the 
Final import risk analysis report for apples from New Zealand , November 2006."334 
2.99 Further, New Zealand argues that: 
"According to the IRA the measures [at issu e] are to be implemented in practice 
through a Work Plan and 'Standard Oper ating Procedures'.  Under the IRA these 
instruments are required to be developed by New Zealand and approved by Australia 
before trade can take place."335 
2.100  Indeed, at the parts referenced by New Zealand, the IRA provides: 
"It is a requirement that MAFNZ or the registered agency prepare a documented 
standard operating procedure (SOP) or ma nual that describes the phytosanitary 
procedures for each of the pests of quaran tine concern for Australia and the various 
responsibilities of all parties involved in meeting this requirement.  The operating 
procedure must be approved by AQIS befo re exports commence and will be subject 
to audit by AQIS. 
A draft work plan will be develope d between DAFF and MAFNZ following the 
finalisation of this IRA. 
The work plan procedures may include, but are not limited to operational details on: 
• inspection and sampling methodology 
• pre-clearance arrangements 
• maintenance and supply of records 
• storage segregation and identification of lots, and 
• dealing with rejected lots. 
• details on standard commercial practice."336 
2.101  In response to a question by the Panel following the first substantive meeting, 
in September 2008 both Parties confirm that they ha ve not been able to agree on the SOP and the 
                                                      
331 Australia's opening oral statement at the first su bstantive meeting of the Panel with the Parties, 
para. 16. 
332 Australia's opening oral statement at the first substa ntive meeting of the Panel with the Parties, p. 3. 
333 Australia – Apples , Communication from the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, para. 13(a). 
334 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A-1 to this report, p. 1.  See also, New Zealand's first written submission, 
para. 3.81. 
335 New Zealand's first written submission, para. 3.81 (footnote omitted).  See also Australia's reply to 
Panel question 1 after the first substantive meeting. 
336 Australia's IRA, Part B, pp. 313-314.  WT/DS367/R 
 Page 41 
 
 
 work plan.337  The Panel has not received any indication of  such an agreement having been concluded 
since then. 
2.102  In any event, the Parties agree that it is the IRA,  not the SOP or the work plan, that spells out 
the measures at issue in this dispute.  The refere nce in New Zealand's panel request to Biosecurity 
Australia Policy Memorandum 2007/07 of 27 March 200 7 explicitly refers to "measures ... specified 
in the Final import risk analysis report for apples from New Zealand , November 2006."338  As regards 
the SOP and the work plan, New Zealand explains that  one of the reasons for it not being able to agree 
on the SOP and the work plan was that "in the cour se of [its] discussions [with Australia] concerning 
the SOP and the work plan it became clear that  this process would not result in any significant 
departure from or amelioration of the requirements of the IRA."339  New Zealand adds that "[g]iven 
that the measures at issue in this dispute … mirro r those set out in the IRA, and that the SOP and 
work plan must conform with the IRA … the IRA se ts out the exact conditions of New Zealand apple 
exports to Australia."340  Australia notes "that the SOP and work plan do not form part of the 
New Zealand's panel request and are therefor e outside the Panel's terms of reference."341 
5. Disagreements on some of the 16 specific measures at issue 
2.103  While the Parties agree that the 16 remaining sp ecific measures at issue are spelt out in the 
IRA, they disagree on the actual nature of some of those 16 measures.  From the outset of this dispute 
Australia argues that "New Zealand's description of [Measures 1, 4, 11 and 15] … is flawed"342, which 
New Zealand has contested throughout the proceedi ngs.  The Panel turns to these contested measures 
in the order of the numbers assigned to them. 
(a) Measure 1 
2.104  As noted above, New Zealand's panel request id entifies Measure 1 as "[t]he requirement that 
apples be sourced from areas free from fire blight disease symptoms."343  In its first written 
submission, New Zealand references  page 106 of Part B of the IRA in regard to this measure.344  
This page of the IRA contains a part entitled "Areas free from disease symptoms", and provides inter 
alia: 
"Areas free from disease symptoms, as distinct from pest free areas, could be 
established and maintained following the guidelines described in ISPM No. 4:  
Requirements for the establishment of pest free areas (FAO, 1996b), ISPM No. 10:  
Requirements for the establishment of pest free places of production and pest free 
production sites (FAO, 1999) and ISPM No. 22:  Requirements for the establishment 
of areas of low pest prevalence (FAO, 2005).  An area free from disease symptoms 
could be a place of production (an orchard managed as a single unit) or a production 
                                                      
337 Australia's reply to Panel questions 27-31 after the first substantive meeting, and New Zealand's 
reply to Panel questions 27-32 after the first substantive meeting. 
338 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A-1 to this report, p. 1.  See also, New Zealand's first written submission, 
para. 3.81. 
339 New Zealand's reply to Panel question 31  after the first substantive meeting. 
340 New Zealand's reply to Panel question 29  after the first substantive meeting. 
341 Australia's reply to Panel question 27 after the first substantive meeting. 
342 Australia's first written submission, p. 67. 
343 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Anne x A-1 to this report, p. 1. 
344 New Zealand's first written submission, para. 3. 83, footnote 78.  New Zealand's reply to Panel 
question 35 after the first substantive meeting. WT/DS367/R 
Page 42  
 
 site (a designated block within an orchard), for which freedom from fire blight 
symptoms is established, maintained and verified by MAFNZ. 
The literature on infestation and infection of fruit with E. amylovora has been 
reviewed extensively in the section on Im p2 above. Endophytic infection of fruit has 
been recorded in immature fruit sourced from infected orchards (van der Zwet et al., 
1990), but it has not been recorded in orchards free from symptoms of fire blight in 
New Zealand.  Endophytic populations of E. amylovora were not recovered from 
mature fruit at harvest (Dueck, 1974a;  Roberts et al., 1989;  Roberts, 2002). On the basis of the work reviewed in Imp2 the IR A team concluded that endophytic infection 
was not a risk factor for fruit sourced from orchards free from symptoms. 
In assessing the risk of calyx and surface inf estation the IRA team took note of the 
literature on infestation rates for apples sourced from orchards with few or no symptoms.  For example, studies conducted in New Zealand by Clark et al. (1993), using a specific DNA hybridisation method with a detection level of about 10
2 cfu per 
calyx, 60,000 immature apple fruit were test ed from orchards free of fire blight 
symptoms, but E. amylovora was not detected.  Such fruit, when mature would not 
have bacteria present in the calyces but may carry E. amylovora on the surface if the 
disease has been active in the orchard near to harvest time.  There are many other 
studies that show that infestation of fruit is undetectable or the number of fruit infested is very small when fruit is sour ced from orchards with few or no visible 
symptoms of fire blight (see Imp2 above).  The IRA team concluded that 'freedom 
from visible symptoms' provided a firm b asis for risk reduction by substantially 
reducing the likelihood that picked fruit is infected or infested."
345 
2.105  The IRA continues on the same page by turning to Measure 2:346 
"The IRA team acknowledged th at it would be extremely difficult to confirm absolute 
freedom from symptoms using visual inspection of orchards.  The IRA team 
concluded that a practical inspection regime should be specified as free from visual 
symptoms at an inspection intensity that would, at a 95% confidence level, detect 
visual symptoms if shown by 1% of th e trees.  This inspection should take place 
between 4 to 7 weeks after flowering wh en conditions for fire blight disease 
development are likely to be optimal."347 
2.106  The subsequent page of the IRA addresses the re sulting risk reduction, in particular in the 
context of importation steps 2, 3a and 5348, and finds that the resulting "restricted annual likelihood of 
entry, establishment and spread [would] remain ... at 'very low' range".349  The IRA explains that 
"[w]hen these values are combined with the estimate of consequences of 'high' for fire blight, the 
restricted risk for this pest [would] ... be 'l ow', which [would] still exceed ... Australia's ALOP."350  
                                                      
345 Australia's IRA, Part B, p. 106. 
346 In its panel request, New Zealand describes Measure 2 as "[t]he requirement that orchards/blocks be 
inspected for fire blight disease sympto ms, including that they be inspected at  an inspection intensity that would, 
at a 95% confidence level, detect visu al symptoms if shown by 1% of the trees, and that such inspections take 
place between 4 to 7 weeks after flowering."  Australia – Apples , Request for the Establishment of a Panel by 
New Zealand (WT/DS367/5), 7 Decem ber 2007, attached as Annex A-1 to this report, p. 1. 
347 Australia's IRA, Part B, p. 106. 
348 Australia's IRA, Part B, p. 107. 
349 Ibid. 
350 Ibid.  WT/DS367/R 
 Page 43 
 
 
 The IRA concludes that "[t]he use of areas free from visible fire blight symptoms for sourcing export 
apples would not be a sufficient risk management measure by itself."351 
2.107  In its first written submission, Australia argu es that "New Zealand has mischaracterized" 
Measure 1.352  Australia notes that New Zealand's first written submission refers to Measure 1 also as 
a requirement of "area freedom".353  However, Australia argues, the concept of "'area freedom' is 
analogous to the pest free area concept in ISPM No. 4 – that is, 'an area in which a specific pest does 
not occur as demonstrated by scien tific evidence and in which, wher e appropriate, this condition is 
being officially maintained'.354"355  Australia points out that "the Final IRA Report notes356 [that] the 
concept of an 'area free of disease symptoms', is [a lso] distinct from 'pest free areas' and the similar 
'pest free places of production' (ISPM No. 10)."357  Australia adds that "ISPM No. 10 is a sub-category 
of ISPM No. 4."358 
2.108  Australia argues further that "[its] precise requirement is that New Zealand apples be sourced 
from areas free from visible symptoms of fire blight during the period between 4 to 7 weeks after flowering."
359  Australia adds that "[it] is prep ared to tolerate the existence of E. amylovora  in the 
areas from which New Zealand apples are sourced up to the period where the disease symptoms are 
visible in the period between 4 to 7 weeks after flowering."360  Australia contends that "[t]his 
requirement reflects the concep t of 'low pest prevalence'"361, spelt out in ISPM No. 22 as follows: 
"The establishment of an area of low pest prevalence (ALPP) is a pest management 
option used to maintain or reduce a pest pop ulation below a specified level in an area. 
An ALPP may be used to facilitate exports or to limit pest impact in the area.362"363 
Australia requests the Panel to "bear in mind the dis tinction between an orchard that is 'free' of the 
bacteria, E. amylovora , and an orchard that is merely 'free' of fire blight symptoms."364 
2.109  In response to a question by the Panel followi ng the first substantive meeting, New Zealand 
contends that "[it] has correctly characterised the relevant measure at issue (Measure 1) in its Panel 
request as the requirement that apples be sourced from areas free from fire blight disease symptoms."
365  New Zealand also confirms that "[b]y 'area freedom', [it] refers [also] to 
Measure 1"366, and stated that Measure 1, "which requir es that apples be sourced from areas free from 
fire blight disease symptoms"367, "does not equate to freedom from the pathogen, E. amylovora ."368  
At the same time, New Zealand points out that "there  is no reference in the IRA to 'tolerance' of the 
                                                      
351 Australia's IRA, Part B, p. 107. 
352 Australia's first written submission, p. 69. 
353 Australia's first written submission, para. 157, fo otnote 140, referencing New Zealand's first written 
submission, paras. 4.33 and 4.39. 
354 (footnote original)  ISPM No. 4, p. 37. 
355 Australia's first written submission, para. 157. 
356 (footnote original)  Final IRA Report, Part B, p. 106. 
357 Australia's first written submission, para. 157. 
358 Australia's reply to Panel question 36 after the first substantive meeting. 
359 Australia's first written submission, para. 158. 
360 Australia's first written submission, para. 159. 
361 Australia's first written submission, para. 158. 
362 (footnote original) ISPM No. 22, p. 265. 
363 Australia's first written submission, para. 158. 
364 Australia's first written submission, para. 159. 
365 New Zealand's reply to Panel question 33  after the first substantive meeting. 
366 New Zealand's reply to Panel question 34  after the first substantive meeting. 
367 Ibid. 
368 Ibid. WT/DS367/R 
Page 44  
 
 presence of E. amylovora  and [it] rejects Australia's post facto attempt in its First Written Submission 
to link Measures 1 and 2 to the c oncept of low pest prevalence."
369 
2.110  In its response to a question from the Panel, Ne w Zealand also argues that the requirement for 
"areas free from disease symptoms under Measure 1 (fire  blight) is similar to the requirement for "pest 
free place of production" under Measure 9 (European canker).370  The reason for this, according to 
New Zealand, is that: 
"Both [Measures 1 and 9] require visual inspections for symptoms of the disease and 
result in exclusion of an orchard in the event of the detection of any symptoms.  
The inspection requirement reflects the fact that a detection of disease symptoms is the logical and practical way to detect the presence of the disease."
371 
2.111  New Zealand adds that Measures 1 and 9 "shoul d be distinguished from the term 'pest free 
area', as defined in IPSM No 4" because "[a]ppli cation of a measure requiring that product be sourced 
from a 'pest free area' would require systems to be put in place by MAFNZ to establish, maintain and 
verify that the pathogens E. amylovora  or N. galligena  did not occur in that area."372 
2.112  Conversely, in its response to a question fro m the Panel following the first substantive 
meeting, Australia distinguishes Measures 1 and 9, ar guing that its "measures for fire blight are based 
on ISPM No. 22 and its measures for European canker are based on ISPM No. 10."373  Australia adds 
that while "[i]n respect of fire blight, [it] re quires an 'area of low pest prevalence' ... [(and] 
New Zealand occasionally uses the term 'area freedom' to refer to this requirement)"374, "[i]n respect 
of European canker, [it] requires 'pest free places of production'."375  Australia reiterates its earlier 
distinction between pest freedom and symptom freedom: 
"The concepts of 'pest free areas' and 'p est free places of production' both relate to 
freedom of a particular geographic location from a pest in its entirety.  By contrast, an 'area of low pest prevalen ce' assumes that a certain level of the pest may be present 
in the geographic area – but that it exists  at a specified level.  In the case of 
Australia's fire blight measure, the area of  low pest prevalence is determined by the 
absence of any symptoms detected during visual inspection."
376  
2.113  The Panel does not consider it necessary to establish which ISPM Measure 1 might 
correspond to or should be distinguished from.  No r is it necessary for the Pa nel to assess whether the 
Parties have been using the term "area freedom " correctly when describing Measure 1 in their 
submissions, or whether, as New Zealand argues, Measures 1 and 9 are similar. 
2.114  The issue before the Panel is whether the essen ce of Measure 1 is a requirement for freedom 
from E. amylovora , or freedom from the symptoms of fire blight, and whether New Zealand describes 
this correctly in its panel request. 
                                                      
369 New Zealand's reply to Panel question 33  after the first substantive meeting. 
370 New Zealand's reply to Panel question 35 after the first substantive meeting.  In its panel request, 
New Zealand describes Measure 9 as "[t]he requirement th at apples be sourced from export orchards/blocks free 
of European canker (pest fre e places of production)."  Australia – Apples , Request for the Establishment of a 
Panel by New Zealand (WT/DS367/5), attached as A nnex A-1 to this report, 7 December 2007, p. 2. 
371 New Zealand's reply to Panel question 35  after the first substantive meeting. 
372 Ibid. 
373 Australia's reply to Panel question 36 after the first substantive meeting (footnotes omitted). 
374 Ibid. (footnotes omitted). 
375 Ibid. (footnotes omitted). 
376 Ibid. (footnotes omitted).  WT/DS367/R 
 Page 45 
 
 
 2.115  As to the first aspect of this issue, there can  be no doubt that the IRA requires freedom from 
symptoms, not freedom from E. amylovora .  In fact, at the part referenced by New Zealand, the IRA 
describes Measure 1 as a requirement for "areas/an area free from disease symptoms"377, and defines 
such an area as "a place of production (an orchard managed as a single unit) or a production site (a 
designated block within an orchard), for which free dom from fire blight symptoms is established, 
maintained and verified by MAFNZ."378  Other references in the IRA to the same requirement are also 
explicit about symptom freedom.379  The IRA's description of Measure 2, immediately following the 
description of Measure 1, also makes clear that the inspection requirement related to Measure 1 
involves an inspection for symptom freedom, not pest freedom.380 
2.116  The Panel notes that the IRA distinguishes sy mptoms from pests.  In the context of the 
definition of the term "symptomless", the IRA equate s symptoms to "any visible indication of disease 
by reaction of the host, e.g. canker, leaf spot, wilt."381  In turn, the IRA defines "pest" as: 
"The collective term used for insect pests,  plant diseases, viruses, bacteria and fungi 
that could harm plants.  The formal de finition used is the one provided in the 
International Plant Protection Convention (IPPC ):  any species, strain, or biotype of 
plant, animal or pathogenic agent in jurious to plants of plant products."382  
2.117  The Parties accept that symptom freedom and pe st freedom are distinct concepts in the 
context of fire blight.383  The experts also confirm the validity a nd importance of this distinction.  The 
experts explain that pest freedom and symptom free dom are two distinct concepts in the context of 
fire blight and apple orchards because at specific mome nts in time fire blight bacteria could be present 
in an orchard (or on neighbouring hosts) without there being visible symptoms of the fire blight 
disease.384 
2.118  As Australia argues, a corollary of a requireme nt for symptom freedom, as distinguished from 
a requirement for pest freedom, is that symptom free dom implies a certain tolerance for the pest in the 
orchard in question.  Dr Paulin explains that, logi cally, the IRA has to provide for such tolerance in 
regard to fire blight: 
"The IRA indicates that no area can be proved to be without fire blight in apple 
production zones in New Zealand.  If this is correct, the requirements are made on the assumption that there is not any orchard from which apples are exported which is 
(or has ever been in the 50 last years) wit hout fire blight:  therefore the IRA provides 
a certain level of tolerance."
385 
                                                      
377 Australia's IRA, Part B, p. 106. 
378 Ibid. 
379 See Australia's IRA, Part B, pp. 110-116 and 316. 
380 Australia's IRA, Part B, p. 106.  See also, ibid., p. 316. 
381 Australia's IRA, Part B, p. 346. 
382 Australia's IRA, Part B, p. 340. 
383 See New Zealand's reply to Panel question 34 after the first substantive meeting, Australia's first 
written submission, para. 157, and Australia's reply to Pa nel question 36 after the first substantive meeting. 
384 Reply of Dr Deckers to Panel question 8, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 64;  Reply of Dr Paulin to Panel question 8, in List of Replies from the scientific 
experts to questions posed by the Panel, paras. 65-71. 
385 Reply of Dr Paulin to Panel question 8 in List of Replies from the scientific experts to questions 
posed by the Panel, para. 65. WT/DS367/R 
Page 46  
 
 2.119  In fact, in the context of importation step 1, the IRA provides that: 
"[F]ire blight caused by E. amylovora is widespread in New Zealand and ... the 
bacterium would be present in all orchar ds throughout the major production areas.  
Therefore the IRA team decided to represent Imp1 [i.e. importation step 1] as 1."
386 
2.120  Continuing, the IRA makes a clear distinction between symptom freedom and pest freedom, 
and explains that importation step 1 relates to the latter: 
"One stakeholder has indicated that the above value cannot be justified and asserted 
that orchards selected for the export of  fruit to Japan in 1994-95 were free of 
E. amylovora .  While these orchards may have been free of symptoms this does not 
mean that E. amylovora was absent.  Imp1 concerns the presence of E. amylovora not 
disease symptoms."387 
2.121  Further, before spelling out Measure 1 specifi cally, the IRA explicitly provides for tolerance 
of E. amylovora  in New Zealand orchards: 
"Sourcing apples for export from areas establis hed, maintained and verified free from 
E. amylovora ('pest free areas'), in accordance with the guidelines outlined in ISPM 
No. 4:  Requirements for the establis hment of pest free areas (FAO, 1996b) would 
reduce the likelihood of several of these step s to 'negligible' and thereby mitigate the 
risks.  However, this option was not  considered feasible, given that E. amylovora is 
widely distributed in apple-growing areas of New Zealand and there is no feasible 
way to verify if bacteria are present in orchards or not.  
However, individual apple orchards in New Zealand can be maintained free from fire 
blight disease symptoms ('areas free from disease symptoms') through the use of 
various management practices.  Such orch ards are known to have lower levels of 
bacteria associated with fruit than orchards where symptoms are evident.   Similarly, 
treatments with chlorine and cold storage of apples have been reported to reduce 
bacterial numbers.  Therefore the following options were evaluated to mitigate the 
risk of fire blight: 
• Source apples for export from individual orchards free from fire blight disease 
symptoms (areas free from disease symptoms) 
• Disinfest apples for export with 100 ppm chlorine for one minute at pH 5–6 
(chlorine treatment) or other suitable disinfection treatment. 
• Store apples for export at a temperature of 0 °–4°C for six weeks (storage) 
• Combinations of areas free from disease symptoms , chlorine treatment or storage 
(systems approach)."388 
2.122  New Zealand's description of Measure 1 in its panel request also talks specifically about 
"free[dom] from fire blight disease symptoms"389, and not freedom from E. amylovora . 
                                                      
386 Australia's IRA, Part B, pp. 53-54. 
387 Australia's IRA, Part B, p. 55. 
388 Australia's IRA, Part B, pp. 105-106 (emphasis added). 
389 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Anne x A-1 to this report, p. 1.  WT/DS367/R 
 Page 47 
 
 
 2.123  In light of the above, as a factual point, the Panel agrees with Australia that the essence of 
Measure 1 is a requirement for freedom from fire blight symptoms, not freedom from E. amylovora .  
Hence, the Panel also agrees with New Zealand th at "New Zealand has correctly characterised the 
relevant measure at issue (Measure 1) in its Panel request as the requirement that apples be sourced from areas free from fire blight disease symptoms."
390 
(b) Measure 4 
2.124  In its panel request New Zealand refers to  Measure 4 as "[t]he requirement that an 
orchard/block be suspended for the season on the basi s 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."391  In its first written submission New Zealand li nks Measure 4 to page 316 of Part B of the 
IRA392, which provides in relevant part that "[a]ny evidence of pruning or other activities carried out 
before the inspection that could constitute an attempt to remove or  hide symptoms of fire blight would 
result in the suspension of th e orchard/block for the season."393 
2.125  Australia argues that "New Zealand has misunders tood the fire blight requirement in respect 
of pruning".394  Australia points out that the above-cited passage from the IRA contains the word 
"that", which does not figure at the relevant part  of New Zealand's description of Measure 4.  
Australia contends that "New Zealand's omission of  the word 'that' changes the nature of this 
requirement":395 
"Australia's requirement is not that any evidence of pruning before the inspection will 
be taken by Australia as an attempt to remove symptoms of fire blight, resulting 
automatically in suspension of that orchar d/block for the season.  An orchard/block 
would only be suspended on evidence  of pruning before the inspection if AQIS 
officers believe that the pruning in that in stance may have been an attempt to hide 
symptoms of fire blight."396 
According to Australia, Measure 4 is not a "requi rement not to prune", as New Zealand argues;  
"[t]he only requirement is that pruning is not used to hide symptoms of fire blight in orchards."397 
2.126  New Zealand agrees that the description of the measure in the IRA includes the word "that", 
but it disagrees that the inclusion of this word resu lts in any change in the meaning of the measure.398  
New Zealand argues that pruning can also have leg itimate purposes:  it is a good agricultural practice 
and necessary for good orchard hygiene, as well as being an important method for managing fire blight disease.
399  Accordingly, "it is not possible to determine the purpose of pruning by visually 
inspecting an apple tree":400 
                                                      
390 New Zealand's reply to Panel question 33  after the first substantive meeting. 
391 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Anne x A-1 to this report, p. 1. 
392 New Zealand's first written submi ssion, para. 3.83, footnote 81. 
393 Australia's IRA, Part B, p. 316 (emphasis added). 
394 Australia's first written submission, p. 70. 
395 Australia's first written submission, para. 163 (footnote omitted). 
396 Ibid. (original emphasis;  footnote omitted). 
397 Australia's reply to Panel question 39 after the first substantive meeting. 
398 New Zealand's reply to Panel question 37 after the first substantive meeting.  See also 
New Zealand's reply to Panel question 38 after the first substantive meeting. 
399 New Zealand's first writte n submission, para. 4.38. 
400 New Zealand's reply to Panel question 39  after the first substantive meeting. WT/DS367/R 
Page 48  
 
 "[T]he requirement under the IRA amounts to  an automatic suspension on discovery 
of evidence of pruning.  This is reinforced by the permissive ' could  constitute an 
attempt to remove or hide symptoms of fire blight'."
401 
2.127  Australia concurs that "it is not possible to determine through visual inspection, per se , 
whether pruning ... has been done 'in an attempt to remove or hide symptoms of fire blight or for 
orchard management purposes."402  Australia argues, however, that "i t is possible to form a view that 
an attempt to remove or hide symptoms of fire blight may have been made if pruning has occurred 
that is not consistent with good orchard practice."403 
2.128  New Zealand takes this statement by Australia as a "concession" that "it is not possible to 
determine through visual inspection whether pruning of  an apple tree has been done 'in an attempt to 
remove or hide symptoms of fire blight' or for orchard management purposes."404 
2.129  In their responses to the Panel, the experts expl ain that pruning is a standard procedure in the 
winter or dormant period.  Dr Paulin notes that "winter-pruning is a standard procedure in tree 
management"405, and Dr Deckers refers to "standard pruni ng measures that are made during dormant 
season."406 
2.130  As regards pruning in the growing season, Dr Deckers explains that: 
"Pruning out the fire blight infections during growing season is a control measure that 
is taken in many countries to keep the fire blight situation under control in an orchard.  
It should not be regarded as a way to hide the fire blight infections because this 
pruning out of the fire blight infectio ns during season can easily be distinguished 
from the standard pruning measures that  are made during dormant season."407 
2.131  Dr Deckers concludes that "[s]uspension of the export when recent fire blight pruning in an 
orchard has been observed seems to be a logic measure in the IRA."408 
2.132  Dr Paulin provides a more nuanced response as regards pruning during the growing season.  
Dr Paulin does not state explicitly wh ether or not it is easy visually to  distinguish pruning to hide fire 
blight symptoms from other pruning.  In fact, he  refers to Measure 4 as a "ban of pruning".409  
Nevertheless, Dr Paulin sees some logic to Measure 4,  but only "as soon as [the IRA] limits the ban of 
pruning, for export orchards to the pruning which takes place after the beginning of the blossom 
period ."410  Dr Paulin adds that "the suspension of export is soundly based on the evidence of this late 
pruning"411, implying that "the evidence of this late pruning" can be distinguished from other, more 
                                                      
401 New Zealand's reply to Panel question 38  after the first substantive meeting. 
402 Australia's reply to Panel question 39 after the first substantive meeting. 
403 Ibid. 
404 New Zealand's reply to Panel question 68 afte r the second substantive meeting.  See also 
New Zealand's comments on Australia's reply to Panel question 68 after the second substantive meeting. 
405 Reply of Dr Paulin to Panel question 9, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 75. 
406 Reply of Dr Deckers to Panel question 9, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 72. 
407 Ibid. 
408 Ibid. 
409 Reply of Dr Paulin to Panel question 9, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 74. 
410 Ibid. (original emphasis). 
411 Reply of Dr Paulin to Panel question 9, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 75.  WT/DS367/R 
 Page 49 
 
 
 standard types of pruning.  Dr Paulin explains the ra tionale for this in terms of the annual cycle of the 
development of fire blight and its symptoms in apple orchards: 
"[S]ymptoms of fire blight develop in sp ring and early summer, associated with the 
presence of blossoms and then actively growi ng shoots.  The main infection period is 
the blossom period.  If an orchard is infected in spring or early summer, 
the development of symptoms will stop in summer and autumn.  If the trees are 
trimmed for suppression of symptoms, it could well be that the orchard looks symptomless when actually it has shown ac tivity of the disease (and hence production 
of ooze with bacteria), which could have consequences on fruit infestation.  In addition, it remains possible that a re newal of activity of the disease takes place 
after the inspection, but before cropping."
412 
2.133  Commenting on the experts' responses, New Zealand points out that "Dr Deckers' response is 
that pruning out infections is a standard pr actice consistent with good orchard management."413  
As regards the other points of Dr Deckers's relevant response, New Zealand argues that "Dr Deckers' answer ... does not address the real issue, which is  whether it is possible to ascertain from a visual 
inspection whether pruning of an apple tree has been done 'in an attempt to remove or hide symptoms 
of fire blight' or whether it has been done for orchard management purposes.'"
414  I n  f a c t ,  
New Zealand considers that "whether 'pruning out of the fire blight infections during [growing] 
season can easily be distinguished from the standard pruning measures that are made during dormant season' would depend on when the inspection took place."
415  In light of Australia's alleged concession 
cited above, New Zealand adds that  "Australia has [not] adequately articulated how ... [M]easure [4] 
could be implemented."416 
2.134  Conversely, Australia agrees with Dr Deckers "that pruning out of fire blight infection during 
the season, particularly before inspection, is dis tinguishable from standard pruning measures used by 
growers in the 'dormant' season."417  Australia adds that "[t]he IRA Team took this into account"418, 
and it refers to page 114 of the IRA419, which provides that "the purpose of the inspection was to 
ensure that fire blight was not active in the or chard at the early stage of fruit development and 
therefore reduce the likelihood that E. amylovora would be present in the calyces of mature apples."420  
The same page of the IRA also explains the origin of Measure 4: 
"Removal of infected plant material immediately prior to the inspection was a 
concern highlighted by some stakeholders.  They have suggested that any grower resorting to the practice of pruning off inoc ulum before the inspection should be not 
be [sic] allowed to be in the export program.  The IRA team agrees that successful 
removal of all visually infected material  before inspection could result in orchard 
blocks passing inspection when they should have failed.  The IRA team doubts that 
given the labour costs it would be commercia lly viable to undertake this task but 
nevertheless has modified the risk manageme nt framework to deal with this issue."
421 
                                                      
412 Reply of Dr Paulin to Panel question 9, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 73. 
413 New Zealand's reply to Panel question 68  after the second substantive meeting. 
414 Ibid. 
415 Ibid. 
416 Ibid. 
417 Australia's reply to Panel question 68 after the second substantive meeting. 
418 Ibid. 
419 Ibid., footnote 328. 
420 Australia's IRA, Part B, p. 114. 
421 Ibid.. WT/DS367/R 
Page 50  
 
 2.135  Australia points out that, in fact: 
"[T]he fundamental issue relating to pruning does not concern the dormant  season.  
The relevant issue is the capacity to hide symptoms  of fire blight by pruning 
symptomatic material out during the early  growth phase, just prior to orchard 
inspection."
422 
2.136  As regards the measure not being sufficiently sp ecific, Australia explains that the IRA was 
not intended to set out all the details of the operation of Measure 4: 
"[T]he operational details as to how the different types of pruning can be 
distinguished would form part of the sta ndard operational procedures and work plans 
to be developed by New Zeal and and approved by Australia. 
Australia considers that there are severa l procedures that could deal with this 
situation. These could include requirement s on timing of pruning or that pruned 
cuttings be left under trees to allow them to be examined at inspection."423 
2.137  Commenting on these arguments by Australia, New Zealand agrees "that the fundamental 
issue relating to Australia's pruning measure does not concern the dormant season."424 
2.138  In establishing the nature of Measure 4, a nd whether New Zealand has misunderstood it, 
the Panel needs to look at the relevant passage from the IRA, referenced also by New Zealand: 
"Any evidence of pruning or other activities carried out before the inspection that 
could constitute an attempt to remove or hide  symptoms of fire blight would result in 
the suspension of the orchard/block for the season."425 
2.139  New Zealand is right that, by merely looking at this language, it is not possible to tell if the 
word "pruning" is qualified by the term "carried out before the inspection that could constitute an 
attempt to remove or hide symptoms of fire blight ", or whether this latter term only qualifies "other 
activities".  It is even possible, although again impo ssible to tell with certainty from the mere wording 
of this passage in the IRA, that the term "ca rried out before the inspection" relates only to 
"other activities", and that the term "that could consti tute an attempt to remove or hide symptoms of 
fire blight" qualifies both "pruning" and "other activ ities carried out before the inspection".  The Panel 
also agrees with New Zealand that the use of the word "could" in " could  constitute an attempt to 
remove or hide symptoms of fire  blight" increases the latitude of the inspector as well as the scope of 
Measure 4. 
2.140  Nevertheless, the Panel notes that the above  passage in the IRA spelling out Measure 4 
follows immediately the IRA's description of Measure  1 ("The detection of any visual symptoms of 
fire blight would result in the suspensi on of the orchard/block for the season").426  In turn, this 
description follows immediately the language in the IRA spelling out the inspection requirement 
under Measure 2: 
"Orchards will be inspected at an inspection intensity that would, at a 95% confidence 
level, detect visual symptoms if shown by 1% of the trees.  This inspection should 
                                                      
422 Australia's reply to Panel question 68 after the second substantive meeting. 
423 Ibid. 
424 New Zealand's comments on Australia's reply to Panel question 68 after the second substantive 
meeting. 
425 Australia's IRA, Part B, p. 316 (emphasis added). 
426 Ibid. (emphasis added).  WT/DS367/R 
 Page 51 
 
 
 take place between 4 to 7 weeks after flowering when conditions for development of 
fire blight disease are likely to be optim al.  MAFNZ must provide details of the 
proposed inspection methodology, including an analysis showing that the methodology will achieve the required effi cacy, in advance of commencement of 
exports.  This analysis must address practical issues such as 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 training a nd certification of inspectors.  The proposed 
system will need to be approved before the commencement of trade. 
One stakeholder has claimed that the propo sed inspection regime would mean that 
only 300 trees would be inspected.  The IRA team notes that this may well be the 
case if the inspection efficacy for each tree is 100% but would not be the case if the 
efficacy was less than this. MAFNZ must provide details of the inspection regime and an analysis of how this regime achieves the required overall efficacy (see above)."
427 
2.141  As the title of the relevant part of  the IRA ("Fire blight symptoms"428) indicates, these 
passages, and hence the measures they spell out, are closely related among themselves through their 
shared concern for fire blight symptoms.  Measure 4 is concerned with hiding fire blight symptoms by 
the exporter, since that could undermine the inspec tion under Measure 2 as well as the suspension of 
orchards where visual symptoms of fire blight ar e detected during the inspection (Measure 1).  As the 
IRA explains, "successful removal of all visually in fected material before inspection could result in 
orchard blocks passing inspection when they should have failed."429 
2.142  Accordingly, the Panel finds it reasonable to conclude, as a factual point, that the word 
"pruning" in the IRA's passage spelling out Measure 4 is qualified by the term "that could constitute 
an attempt to remove or hide symptoms of fire blight."430 
2.143  Likewise, "pruning" is qualified by the term "ca rried out before the inspection".  Measure 4 is 
closely related to Measure 2:  the IRA explains that the "[r]emoval of infected plant material 
immediately prior to the inspection w as a concern" shared by the IRA Team.431 
2.144  The IRA explicitly rejects a concern expressed by a shareholder during the development of 
the assessment in regard to fire blight infections in previous growing seasons (which would be pruned 
in the winter season immediately preceding the current growing season): 
"[T]he purpose of the inspection was to ensure  that fire blight was not active in the 
orchard at the early stage of fruit development and therefore reduce the likelihood that E. amylovora would be present in the calyces of mature apples.  In this regard the 
past fire blight history of the orchard is irrelevant as long as the inspection process 
shows that fire blight is not active in the orchard at the critical time for E. amylovora 
infestation to occur in the calyx."
432 
                                                      
427 Australia's IRA, Part B, p. 316. 
428 Ibid. 
429 Australia's IRA, Part B, p. 114. 
430 Australia's IRA, Part B, p. 316 (emphasis added). 
431 Australia's IRA, Part B, p. 114. 
432 Ibid. WT/DS367/R 
Page 52  
 
 Thus, the IRA also confirms the irrelevance of any pruning during the dormant season for Measure 4, 
an issue on which both Parties have agreed.
433 
2.145  In line with this purpose of the inspection unde r Measure 2, the timing of the inspection is 
also rather well defined by the IRA.  On the same  page and in the same section as that spelling out 
Measure 4, the IRA determines the basic elements of  Measure 2, in particular its specific timing: 
"Orchards will be inspected at an inspection intensity that would, at a 95% confidence 
level, detect visual symptoms if shown by 1% of the trees. This inspection should take place between 4 to 7 weeks after flowering when conditions for development of fire blight disease are likely to be optimal."
434 
2.146  As Australia argues, the IRA does not specify all elements of Measure 4 and, within the limits 
set out in its text, the IRA leaves a certain margin  of discretion to New Zealand in proposing how to 
implement Measure 4 in detail: 
"MAFNZ must provide details of the proposed inspection methodology, including an 
analysis showing that the methodology will achieve the required efficacy, in advance 
of commencement of exports.  This analysis must address practical issues such as 
visibility of symptoms in the tops of tr ees, the inspection time needed and the number 
of trees to be inspected to meet the efficacy level, and training and certification of inspectors.  The proposed system will need  to be approved before the commencement 
of trade."
435 
As indicated above, the requirement in the IRA that New Zealand develop an operating manual and 
work plan encompasses "operational details on … inspection … methodology."436 
2.147  Although the IRA does not specify every detail of Measure 4, it does set out certain key 
aspects of Measure 4.  Importantly, the IRA makes it clear that it is not concerned with all pruning, or 
with pruning as such.  The IRA does not consider pruning prior to the growing season problematic or 
relevant.  In fact, the IRA took into account the following existing "[o]rchard management"437 
practices in New Zealand: 
"According to the Integrated Fruit Production Program Manual (MAFNZ, 2005a), 
standard commercial practice involves a co mbination of measures recommended for 
management of fire blight in New Zealand, including: 
- pruning out infected shoots and cankers in the winter ... The orchard management practices listed are aimed at eliminating or reducing the 
inoculum before the onset of favourable conditions for spread of fire blight. Failure to 
adhere to a combination of the above me asures could result in increased incidence 
and severity of fire blight which could aff ect fruit quality and cause yield reductions.  
                                                     
 
433 See paras. 2.135 and 2.137 above.  Australia's reply to Panel question 68 after the second 
substantive meeting;  New Zealand's comments on Australia's reply to Panel question 68 after the second substantive meeting. 
434 Australia's IRA, Part B, p. 316. 
435 Ibid. 
436 Australia's IRA, Part B, p. 314. 
437 Australia's IRA, Part B, p. 54.  WT/DS367/R 
 Page 53 
 
 
 Therefore these procedures are likely to be  undertaken by export orchards for 
commercial reasons."438 
2.148  Also, the IRA explains in general terms in the context of the "[c]ontrol"439 of fire blight, 
"[r]outinely most orchardists remove as much infected limbs as possible during the dormant season with the aim of reducing the primary inoculum and also to maintain a high proportion of fruiting 
wood and to control the tree size and shape."
440 
2.149  As regards pruning during the growing season, a car eful reading of the IRA sheds light on the 
IRA's underlying key concern with the "successful rem oval of all visually infected material before 
inspection could result in orchard blocks p assing inspection when they should have failed"441, and the 
ensuing focus of the IRA on pruning in the specific period of "the early stage of fruit development"442, 
prior to the inspection "tak[ing] place between 4 to 7 weeks after flowering."443 
2.150  The IRA notes New Zealand's following pruning practice in the growing season under the 
above-mentioned Integrated Fruit Pr oduction Program Manual of MAFNZ: 
"[F]requently inspecting the orchard;  es pecially from blossoming to mid-summer for 
signs of infected blooms or shoots, pruning and burning any infected material upon 
detection  (Note that removal of infected material before the proposed inspection for 
fire blight will not be permitted in regist ered export orchards – see later section on 
risk management and operational framework)."444 
2.151  As regards visual inspection, the experts c onfirm the viability of distinguishing, through 
visual inspection, "pruning … that … could constitute an attempt to remove or hide symptoms of fire 
blight" from standard pruning in the dormant season.  As to the viability of making a similar 
distinction in the context of pruning during the growing season through visual inspection taking place 
between 4 to 7 weeks after flowering, the Panel c onsiders that this is not directly an issue for 
establishing the exact nature of the measure under review  in this dispute as Measure 4.  That issue is 
more closely related to Measure 2, New Zeala nd's description of which Australia has not been 
contesting.  In the context of Measure 4, the issue of the viability of visual inspection is more related 
to whether Measure 4 itself is viable and can be obj ectively justified.  Accordingly, the Panel will 
address it in the findings section of this report, if necessary.  At this point, the Panel notes only that 
the feasibility of distinguishing, through visible insp ection, pruning that could constitute an attempt to 
hide symptoms of fire blight would in part de pend on the actual inspection modalities to be agreed 
upon by the Parties as part of the operating manual and work plan. 
(c) Measure 11 
2.152  In its panel request, New Zealand refers to Measure 11 as "[t]he requirement that all new 
planting stock be intensively examined  and treated for European canker."445  In its first written 
submission, New Zealand links Measure 11 to page 154 of Part B of the IRA.446 
                                                      
438 Australia's IRA, Part B, p. 54 . 
439 Australia's IRA, Part C, p. 119. 
440 Ibid. 
441 Australia's IRA, Part B, p. 114. 
442 Ibid. 
443 Australia's IRA, Part B, p. 316. 
444 Australia's IRA, Part B, p. 54. 
445 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Anne x A-1 to this report, p. 2. 
446 New Zealand's first written submi ssion, para. 3.83, footnote 88. WT/DS367/R 
Page 54  
 
 2.153  Australia refers to the following passage on the same page of the IRA, arguing that it shows 
that "New Zealand has mischaracterised the Euro pean canker requirement in respect of planting 
stock":
447 
"All new planting stock must be intensiv ely examined, and appropriate cultural 
practices and fungicide sprays used to minimise the likelihood of canker 
infections."448 
2.154  Following the first substantive meeting, th e Panel asked "Australia [to] explain how 
'intensively examined and treated for European canker', as described  in New Zealand's panel request, 
differs from 'intensively examined, and appropriate  cultural practices and fungicide sprays used to 
minimise the likelihood of canker infections' as appare ntly described in Australia's IRA at page 154, 
Part B."449  In response, Australia explains that, 
"[T]here may be no substantive differen ce between New Zealand's and Australia's 
respective understandings of this requirem ent.  However, Australia considers it 
important for the Panel to examine and make findings in respect of the precise measure that Australia actually imposes as set out in the relevant section of the Final 
IRA Report.  This is the reason for Australia's clarification. 
New Zealand's version of the measure refe rs generically to the 'treatment for 
European canker' of planting stock.  Mo re precisely, what Australia requires is 
'appropriate cultural practices and fungicide sprays used to minimise the likelihood of 
canker infections'.  For example, 'appropriate treatment' may mean no treatment at all such as where nursery stock has been sourced from areas that can be verified as free 
from European canker."
450 
2.155  The Panel notes that Australia acknowledges "t hat there may be no substantive difference 
between New Zealand's and Australia's resp ective understandings of this requirement"451, and that 
Australia requests the Panel "to examine and make findings in respect of the precise measure that 
Australia actually imposes as set out in the relevant section of the Final IRA Report."452 
2.156  If there is any difference between the Parties c oncerning Measure 11, it relates to whether all 
new planting stock would need to be treated for European canker or whether some planting stock, 
verified to originate from areas free from European canke r, would not be required to the be treated at 
all. 
2.157  The relevant section of the IRA report setti ng out Measure 11 applies unconditionally to 
"[a]ll new planting stock"453, and is not limited to planting stoc k sourced from areas not verified as 
free from European canker.  It requires " appropriate cultural practices and fungicide sprays"454, 
without however specifying that in certain cas es "appropriate cultural practices and fungicide 
sprays"455 could involve no cultural practice or fungicide  sprays at all.  Also, the requirement for 
"appropriate cultural practices and fungicide sprays"456 serves "to minimise the likelihood  of canker 
                                                      
447 Australia's first written submission, p. 80. 
448 Australia's first written submission, para. 16 5, referring to IRA, Part B, p. 154. 
449 Panel question 41 after the first substantive meeting. 
450 Australia's reply to Panel question 41 after the first substantive meeting. 
451 Ibid. 
452 Ibid. 
453 Australia's IRA, Part B, p. 154. 
454 Ibid. (emphasis added). 
455 Ibid. 
456 Ibid.  WT/DS367/R 
 Page 55 
 
 
 infections"457, not to minimise verified canker infections proper.  All this demonstrates the 
unconditionality of Measure 11 with regard to the treatment of new planting stock. 
2.158  While the IRA spells out Measure 11 in regard to "[a]ll new planting stock"458, 
the immediately preceding sentence in the IRA refe rs to "[i]nfected nurser y stock[, which the IRA 
considers] presents a pathway for the establishmen t and spread of European canker into places of 
production."459  The difference between the two neighbouring sentences underscores the 
unconditionality of Measure 11. 
2.159  Further on the same page, the IRA briefly refe rs to Measure 11 in a similarly unconditional 
manner as New Zealand's panel request, namely as th e "requirement for New Zealand to examine and 
treat nursery plants."460 
2.160  In the expert consultation process, the Panel ask ed the experts the following specific question: 
"Based on Australia's IRA, what is your understanding as to what might be the 
'appropriate cultural practices and fungicide sprays used to minimise the likelihood of 
[European] canker infections'?  In practice, could this encompass no treatment at all where nursery stock has been sourced from areas verified as free from European 
canker?"
461 
2.161  In response to the first question, the experts sp ecify various usual cultural practices applied to 
control European canker.  In regard to fungicide treatment, they explain that such treatment would 
also normally take place at the end of the growi ng season – according to Dr Latorre, in a preventive 
manner, i.e. before any infection has resulted in symp toms.  Dr Latorre states that "cultural practices 
should be integrated with chemical control using specific fungicides, preventively sprayed ( pre-
infection ) in late November or early December to reduce inoculum production and fruit infection."462 
Dr Swinburne refers to "the app lication of fungicides at vulnerable periods such as leaf fall or bud 
burst."463  Also, Dr Deckers explains that one "important  period ... for fungicide applications with the 
aim to reduce NG infections ... is the leaf fall peri od at the end of the season because the leaf scars 
form a preferred infection pathway for a NG infection."464 
2.162  As to the Panel's second question, the expert s provide conflicting responses.  Dr Deckers 
answers that "[e]xclud[ing] the treatments complete ly when the nursery stoc k has been sourced from 
areas verified free from European canker can be risky."465  Conversely, Dr Swinburne explains that 
"[a]ppropriate cultural methods specifically for the control of European ca nker are obviously required 
only where the pathogen is present."466  Dr Latorre states, on the one hand, that "[t]he program would 
involve no treatment where summer rainfalls are non- existent and where disease trees (cankered trees) 
                                                      
457 Australia's IRA, Part B, p. 154 (emphasis added). 
458 Ibid. 
459 Ibid. 
460 Ibid. 
461 Panel question 53 to scientific experts. 
462 Reply of Dr Latorre to Panel question 53, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 339 (emphasis added). 
463 Reply of Dr Swinburne to Panel question 53, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 341. 
464 Reply of Dr Deckers to Panel question 53, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 337. 
465 Reply of Dr Deckers to Panel question 53, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 338. 
466 Reply of Dr Swinburne to Panel question 53, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 341. WT/DS367/R 
Page 56  
 
 have not been detected."
467  However, Dr Latorre adds that "tr eatments should be considered in areas 
highly prone to disease development."468 
2.163  The Panel believes that these answers by the experts explain more directly some normal or 
ideal situation, rather than what is specifically required by the IRA.  In fact, none of the experts 
referred specifically to the IRA on this point.  Also , perhaps since the Panel's first question was not 
specific about new planting stock ("Based on Australia 's IRA, what is your understanding as to what 
might be the 'appropriate cultural practices and fungicide sprays used to minimise the likelihood of [European] canker infections'?"
469), most of the responses related to the treatment of apple trees in 
orchards in general.  Only the following sentence by  Dr Deckers deals specifically with the treatment 
of new planting stock "[e]xclud[ing] the treatme nts completely when the nursery stock has been 
sourced from areas verified free from European canker can be risky."470  Accordingly, the Panel 
accords limited relevance to most of these responses in regard to interpreting how the IRA spells out 
the treatment requirement under Measure 11 in the context of new planting stock. 
2.164  In addition to the treatment requirement, as the first part of Measure 11, the IRA requires in a 
rather unconditional fashion that "[a]ll new pl anting stock must be intensively examined".471  At the 
same time, the IRA does not explain whether su ch intensive examination would involve an 
identification of nursery stock infected with Europ ean canker, which seems to be what the IRA is 
concerned with, or the identification of nursery stock originating in areas verified (or not) for freedom 
from European canker.  Nor does the IRA specify the consequences of such examination or the 
relationship of the two parts of Measure 11, namely  examination and treatment.  In practical terms, 
does examination serve to identify potentially dangerous nursery stock that would be required to be 
treated, or would all nursery stock need to be treated independently of the outcome of the 
examination? 
2.165  In light of the above, the Panel finds as a f actual point, in the context of the treatment 
requirement under Measure 11, that the IRA allows for the possibility that New Zealand would need 
to treat all new nursery stock independently of th e outcome of the examination under Measure 11.  
The actual modalities of the treatment in question would need to be agreed upon by the Parties at a 
later stage472, and the Panel cannot exclude that they might be linked to the outcome of the 
examination. 
2.166  The Panel finds further support for this conclu sion in the potential latency of nursery stock 
infection indicated in the IRA:  
"There are no restrictions on the movement of planting material between districts in 
New Zealand and this could present a pa thway for introducing new inoculum. 
A study in the United Kingdom called the 'M illennium trial' (McCraken et al., 2003b) 
concluded that approximately 6% of canke r infection in new orchards could be 
associated with movement of infected nursery plants, although this figure increased significantly under favourable  climatic conditions.  N. galligena can remain latent in 
                                                     
 
467 Reply of Dr Latorre to Panel question 53, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 340. 
468 Ibid. 
469 Panel question 53 to scientific experts. 
470 Reply of Dr Deckers to Panel question 53, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 338. 
471 Australia's IRA, Part B, p. 154. 
472 Australia's IRA, Part B, pp. 313-314.  WT/DS367/R 
 Page 57 
 
 
 infected plants for up to 3 to 4 years, expressing only when climatic conditions are 
conducive for disease development (McCraken et al., 2003b)."473 
2.167  The IRA points out also that, in a similar vein, "CABI (2003) reports that trees can be 
infected in the nursery shortly after, or during,  propagation and may not express disease symptoms for 
up to three or four years (Berrie et al., 2000;  L ovelidge, 2003;  McCraken et al., 2003a;  McCraken et 
al., 2003b)."474 
2.168  Such a long period of European canker latenc y in infected nursery stock would make it 
necessary to treat all planting stock, not just those showing symptoms of European canker infection.  
This is underscored by the finding of the Millenium Report referenced in the IRA that "there is no 
cost effective method for detecting the pathogen in  symptomless wood which makes it difficult to get 
a handle on the size of the problem".475 
2.169  In fact, according to the IRA, even treat ment of nursery stock might not prevent the 
dissemination of European canker: 
"MAFNZ (2003a) states that one of the larg er nurseries in the Waikato area routinely 
applies fortnightly copper sprays to stock plants and dip tools, and applies 
carbendazim (benzimidazole) and captan to  some cuttings.  In spite of these 
measures, the disease is thought to have  arrived in Nelson on trees imported from 
Waikato (Murdoch, 2002).  Therefore, there is a continual threat of new pathogen inoculum being introduced into disease-free districts and remaining latent for up to 3 to 4 years."
476 
(d) Measure 15 
(i) The Parties' arguments 
2.170  In its panel request, New Zealand identifies Measure 15 as: 
"The requirement that Australian Quarantine 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."
477 
2.171  In its first written submission, New Zealand links Measure 15 to page 314 of the IRA478, 
within the part entitled "Risk mana gement and operational framework"479 and, more specifically, to 
the section entitled "Requirement for pre-clearance" .  This section includes language similar to the 
one contained in New Zealand's panel request: 
"It is recommended that, at least for the initial trade, the quarantine measures operate 
through a standard pre-clearance arrangement with AQIS officers being directly 
involved.  The need for pre-clearance w ould be reassessed after experience had been 
gained following significant trade. 
                                                      
473 Australia's IRA, Part B, p. 119.  See also IR A, Part B, p. 152, and IRA, Part C, p. 102. 
474 Australia's IRA, Part B, p. 143. 
475 Australia's IRA, Part C, p. 102. 
476 Australia's IRA, Part B, p. 119. 
477 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Anne x A-1 to this report, p. 3. 
478 New Zealand's first written submi ssion, para. 3.83, footnote 92. 
479 Australia's IRA, part B, p. 313. WT/DS367/R 
Page 58  
 
 Under these arrangements AQIS officers would be involved in orchard inspections for 
European canker and fire blight, in direct verification of packing house procedures, 
and in fruit inspection.   The involvement of AQIS officers in pre-clearance would 
also facilitate a rigorous audit of ot her arrangements including registration 
procedures, standard commercial practice, traceability, and handling export fruit in a 
secure manner. 
Under the pre-clearance arrangement, on-arrival procedures would provide 
verification that the consignment received was the pre-cleared consignment and that the integrity of the consig nment had been maintained."
480 
2.172  In the context of its claim under Article 5. 5 of the SPS Agreement, New Zealand further 
describes Measure 15 as "[t]he requirement that AQI S be involved in orchard inspections, packing 
house procedures and fruit inspections."481  In regard to orchard inspections in particular, 
New Zealand argues that, "[i]n a ddition to applying very prescriptive inspection requirements for 
New Zealand apples, Australia also requires that AQIS officials be involved in all such 
inspections."482  In the context of fire blight, New Zeala nd argues more generally that "a multitude of 
measures have been applied to New Zealand apples, affecting all stages of th e exportation of the fruit 
from the orchard to the packing house, including th e requirement that AQIS be involved in all these 
steps."483  As for European canker, New Zealand argu es that "again multiple measures have been 
applied to New Zealand apples, including the requ irement that 100% of registered orchards be 
inspected for the disease before normal winter  pruning, with AQIS involvement in those 
inspections."484  New Zealand contends that the IRA "require[s] the involvement of AQIS officials in 
all [such] inspections."485 
2.173  In the context of Article 5.6 of the SPS Agreem ent, New Zealand refers to Measure 15 as the 
"requirement ... that AQIS officers be involved in in spection for European canker and fire blight, in 
direct verification of packing house procedures, and in fruit inspection and treatment".486  
New Zealand argues that "[t]here is an altern ative, less trade restrictive measure reasonably 
available[:] ... simple auditing by AQIS officers of New Zealand systems applicable to the import of 
apples to Australia from New Zealand."487  According to New Zealand: 
"Auditing of New Zealand systems by AQIS officials would simply require 
occasional visits under normal circumstances, or targeted visits in the event that non-compliance was to be detected during routine procedures.  Audit visits normally assess the range of certification processes associ ated with the commodity in question  
from any required field procedures to expor t inspections, and storage and handling 
procedures.  In the first few years of trad e such visits are often annual but frequency 
tends to reduce to rare or ad hoc as th e importing country gains confidence in the 
exporting country's systems.  In past pr actice between Australia and New Zealand, 
audit visits have generally been limited to  the first year of trade and are ad hoc 
thereafter. The AQIS 'involvement' proposed under the IRA goes beyond any other 
inspection regime currently in place fo r New Zealand exports to Australia."
488 
                                                      
480 Australia's IRA, part B, p. 314 (emphasis added). 
481 New Zealand's first writte n submission, para. 4.449. 
482 New Zealand's first wr itten submission, para. 4.447 (original emphasis). 
483 New Zealand's first writte n submission, para. 4.458. 
484 New Zealand's first writte n submission, para. 4.459. 
485 Ibid. 
486 New Zealand's first writte n submission, para. 4.524. 
487 New Zealand's first writte n submission, para. 4.525. 
488 New Zealand's first writte n submission, para. 4.527.  WT/DS367/R 
 Page 59 
 
 
 2.174  New Zealand also argues that AQIS involvemen t would double the number of inspectors and 
more than double the cost of orchard and packing house inspections as New Zealand would have to 
bear, not only the time costs of the AQIS inspectors involved, but all other expenses as well (such as 
their international and domestic trav el, accommodation and living expenses).489 
2.175  Australia calls into question New Zealand' s understanding of Measure 15, arguing that 
"New Zealand has misunderstood the nature of  AQIS involvement in orchard inspections."490  
Australia puts forward that Measure 15 "does not require the involvement of AQIS officials in all 
orchard inspections and packing house operations."491  While "acknowledg[ing] that the level and 
precise nature of 'AQIS involvement' was not defined in the Final IRA Report"492,  Australia adds that 
"AQIS clarified the ... requirements [involved in Measure 15] on a number of occasions during 
bilateral discussions on the standard opera ting procedures (SOP) in 2007 and early 2008."493 
2.176  Australia also recognizes that the text in New Zealand's panel request describing Measure 15 
"is taken from the section entitled 'Requirement fo r pre-clearance' on page 314 of Part B of the 
IRA ..."494  At the same time, Australia links Measu re 15 to the following section entitled "Audit", 
which starts on the same page of the IRA.  The section of the IRA entitled "Audit" states: 
"The New Zealand apple production and certification system is subject to audit by 
AQIS.  Audits may be conducted at the discretion of AQIS during the entire production cycle and as a component of any pre-clearance arrangement.  AQIS field audits will measure compliance with orchard registration, block identification, pest/disease management/monitoring, record s management, and the administration of 
the area freedom and accreditation requirements. 
Audits will be conducted to measure comp liance with packing house responsibilities, 
traceability, labelling, segregation and product security, and MAFNZ/Agency certification processes. 
Participants in pre-clearance arrangements will be audited by AQIS during the season 
to verify that requirements such as the following continue to be met: 
• There is an effective approved documented system in operation, including product 
identification and labelling at each facility to ensure that pre-cleared and non pre-
cleared products are kept separate. 
• At any time pre-cleared product is moved, the transport systems used maintains the 
integrity of the pre-cleared product. 
• Appropriate records are maintained fo r all pre-cleared product in storage."
495 
2.177  Australia supports the relevance of the "A udit" section for Measure 15 with the following 
arguments:  
                                                      
489 New Zealand's first writte n submission, para. 4.535. 
490 Australia's first written submission, p. 67.  See al so Australia's closing oral statement at the first 
substantive meeting of the Panel with the Parties, p. 9. 
491 Australia's first written submission, para. 151.  See also Australia's reply to Panel question 49 after 
the first substantive meeting. 
492 Australia's first written submission, para. 151. 
493 Australia's first written submission, para. 155. 
494 Australia's reply to Panel question 48 after the first substantive meeting. 
495 Australia's IRA, Part B, pp. 314-315. WT/DS367/R 
Page 60  
 
 "'Pre-clearance' means that the normal on-arrival  verification requirements are 
undertaken outside Australia and may include fruit inspection. 
Accordingly, the reference to orchard in spections and verification of packing house 
procedures in [Measure 15] should be take n to be linked to auditing requirements 
which AQIS officials may separately  undertake while present in New Zealand to 
conduct pre-clearance."
496 
2.178  Australia considers that "both [the 'Requirement of pre-clearance arrangement' and the 
'Audit'] sections [of the IRA] are relevant to understanding the involvement of AQIS officials in 
systems audits relating to the export of  apples from New Zealand to Australia."497  According to 
Australia, "audits form a component of the pre-clearance arrangement."498  Australia argues in 
particular that: 
"The 'Audit' section states clearly that New Zealand's 'apple production and 
certification system' is to be subject to audit by AQIS.  The section provides that '[a]udits may be conducted at the discre tion of AQIS during the entire production 
cycle and as a component of any pre-clearance arrangement'.
499  The section then 
goes on to elaborate on the scope of audits.  The reference made to pre-clearance 
arrangements recognises the efficiency an d cost-effectiveness of AQIS officials 
engaged in pre-clearance in  New Zealand also conducting audits.  To do otherwise 
would require other AQIS officials to trav el to New Zealand to conduct audits at 
further cost to New Zealand exporters.  Wh erever possible, significant elements of 
the auditing requirements would be unde rtaken by utilising the presence of AQIS 
officers already involved in pre-clearance. 
... Australia explained that 'pre-clearance' means that activities are undertaken outside 
Australia to meet Australia's usual on-a rrival verification requirements, which are 
separate to auditing requirements.  AQIS o fficials present in New Zealand to conduct 
pre-clearance will separately  conduct systems audits."500 
2.179  Australia adds that: 
"In the Final IRA Report, the distinction betw een 'pre-clearance' and 'audit' is made to 
indicate that AQIS officers' involvement in  orchard inspections for European canker 
and fire blight, in direct verification of packing house procedures and in fruit inspection is mandatory. Audit of othe r components of the New Zealand apple 
production and certification system may be conducted at the discretion of AQIS."
501 
2.180  Referencing the "Audit" section of the IRA, Australia describes Measure 15 as requiring 
systems audits by AQIS: 
"Rather, AQIS activities are to be by way of systems audits.502  F o r  o r c h a r d  
inspections, the audit would include 100% of survey teams in the field, and the 
                                                      
496 Australia's reply to Panel question 48 after the first substantive meeting (original emphasis). 
497 Australia's reply to Panel question 47 after the first substantive meeting. 
498 Australia's reply to Panel question 101 after the second substantive meeting. 
499 (footnote original)  Final IRA Report, Part B, p. 314. 
500 Australia's reply to Panel question 47 after the first substantive meeting. 
501 Australia's reply to Panel question 101 after the first substantive meeting. 
502 (footnote original ) This is explained in the Final IRA Report as follows:  "AQIS field audits will 
measure compliance with orchard registration, block identification, pest/disease management/monitoring,  WT/DS367/R 
 Page 61 
 
 
 intensity of audits would be adjusted ove r time based on performance.  For packing 
houses, all relevant packing houses would be audited in their first year of trade."503    
2.181  Australia argues that: 
"'[A] 100% audit of survey teams' sugg ests that auditors will apply auditing 
techniques, 'questioning, listening, observa tion, documentation', to each and every 
member of each of the survey teams.504  By contrast, the statement that '[t]he audit 
would include 100% of survey teams' signals Australia's intention to audit each survey team by applying audit techniques, 'questioning, listening, observation, documentation', to sufficient members of each  team to satisfy the auditors that 
the team  is meeting the requirements outlined in the Final IRA Report. 
With audits of packing houses, a '100% audit of packing houses' means that each 
packing house will be audited by AQIS o fficers while they are present undertaking 
fruit inspections for pre-clearance.  Du ring the Australian officials visit to 
New Zealand in June 2007, a New Zealand o fficial expressed a view that, at least 
initially, there was likely to be one, pe rhaps two packing houses in each apple 
production region that specialise in packing apples for Australia.  If this view is 
correct, a maximum of six and a minimum of three packing houses would be subject to an AQIS audit."
505 
2.182  As regards fruit inspections, Australia points out  that the exact details of AQIS involvement 
are to be determined in the SOP and that, depe nding on how New Zealand intends to operationalize 
the requirements of the IRA,506 options may be available to reduce costs and avoid duplication.507 
2.183  In response to the Panel's questi on on the exact nature of Measure  15, Australia reiterates that 
"it is difficult to be specific until such time as  New Zealand has completed Standard Operating 
Procedures and a Work Plan that  describes the phytosanitary pro cedures for each of the pests of 
concern and the various responsibilities of all pa rties involved in meeting this requirement."508  
Nevertheless, Australia offers the following more detailed explanations: 
"AQIS will conduct system audits and verifi cations in the first year of trade to 
confirm that the New Zealand system as described in the Standard Operating Procedures and Work Plan is in  place and operating effectively. 
There are three key periods when audits  would be conducted.  These would be 
May/June/July (European canker surveys), October/November (Fireblight surveys), 
and January/February (packhouse manage ment systems and treatments).  
AQIS' initial audit will examine complia nce with the European canker survey 
                                                                                                                                                                    
 
records management, and the administration of the area freedom and accreditation requirements." (Final IRA 
Report, Part B, p. 314.) 
503 Australia's first written submission, para. 151.  See also Australia's reply to Panel question 49 after 
the first substantive meeting. 
504 (footnote original)  Exhibit AUS-118:  AQIS (2007), New Zealand Summerfruits Export to Western 
Australia: Audit Plan  (November 2007). 
505 Australia's reply to Panel question 52 after the first substantive meeting. 
506 (footnote original) See: Final IRA Report, Part B, p. 313. 
507 Australia's reply to Panel question 102 after the second substantive meeting.  See also Australia's 
IRA, Part B, p. 313. 
508 Australia's reply to Panel question 105 after the second substantive meeting.  See also Australia's 
reply to Panel question 106 after the second substantive meeting. WT/DS367/R 
Page 62  
 
 requirements, and also audit NZMAF compliance with all the administrative 
arrangements, reporting structures, and the responsibilities of the various parties. 
Orchard Surveys
 
European canker surveys are to be conducted after leaf fall (May/June/July) while the 
trees are dormant. 
The audit teams will comprise senior, experienced AQIS inspectors/auditors and 
technical experts with experience in det ecting European canker symptoms.  Audit 
teams will attend a percentage of orchard surveys in all growing districts.  AQIS 
understands that the main areas will be Ha wkes Bay (Napier/Hastings) and Nelson.  
Data supplied by NZMAF in May 2007, indicated 200 potential participating 
orchards.  Of these, 75% of orchards will be located in Hawkes Bay, 20% in Nelson, 
and 5% Otago/other. 
The percentage of surveys attended will be dependent upon the number of survey 
teams/IVAs/accredited agencies operating in  each district.  There will be no 
requirement to observe every survey unde rtaken by New Zealand.  Based on the May 
2007 data it is likely that 10% of orchard surveys would be attended by AQIS audit 
teams, e.g 15 in Hawkes Bay, five in Nelson, two in Otago/other. 
The AQIS audit team will verify that survey  personnel are trained and accredited to 
perform the survey task.  AQIS will observe  survey activities during orchard visits 
and will directly question (including 's how me') survey personnel about their 
activities including the process of detecting and identifying disease symptoms on 
trees.  The audit will include reporting arrangements for survey teams including 
records of surveys and outcomes, identif ication arrangements for suspect disease 
material.  There will be concurrent veri fication of orchard registration, block 
identification, pest/disease management monitoring. 
Fire blight surveys must be conducted four to seven week after flowering.  AQIS will 
discuss audit plans with NZMAF to enable AQI S to attend a percentage of surveys in 
each district.  Audit teams will include tec hnical experts with experience in detecting 
fire blight symptoms.  The percentage of  surveys attended in each growing district 
will be dependent upon the number of su rvey teams/IVAs/accredited agencies 
operating in each district. 
Packing house Verification Audits  
An audit of packing house management systems and the mandatory treatment 
requirements will be conducted prior to issuance of an import permit.  Ongoing 
verification of packing house management systems and treatments will be conducted 
by AQIS pre-clearance inspectors during their visits for fruit inspections."509 
2.184  As regards survey teams, Australia adds that: 
"[B]ased upon discussions with New Zeala nd officials in Wellington in June 2007, 
Australia understands that discrete survey teams will operate in each of the main 
apple production areas.  These teams may be operated by, and trained by, different 
accredited agencies.  Given this, Australia considers it would be necessary, at least in 
                                                      
509 Australia's reply to Panel question 105 after the second substantive meeting.  WT/DS367/R 
 Page 63 
 
 
 the initial year, to audit each survey team to be confident that  they are meeting 
Australia's requirements. 
A 'survey team' is considered by Australia to be a group (or team) operating under the 
direction of a single entity, such as an accredited agency in an apple production district such as Hawkes Bay.  There may be a number of such groups in each district, 
or only one in each district.  If these survey  teams split into smaller sub-teams, then 
AQIS would audit a sample of the teams under each entity in each district."
510 
2.185  In response to a question by the Panel, Aust ralia also confirms that "100% of survey teams 
may be audited."511  However, Australia argues that it "does not consider it conceivable that 100% of 
survey team members  would be audited."512 
2.186  Referring to the section of the IRA entitled "Revie w of import conditions", Australia adds that 
"its import requirements for apples from New Zeal and, including the AQIS audit requirements, are 
subject to review after the first year of trade.513"514  The "Review of import conditions" section of the 
IRA provides in relevant part that: 
"It is recommended that Biosecurity Australia and AQIS in consultation with 
MAFNZ, will review the import requirements after the first year of trade.  Further 
reviews will occur if circumstances or  information warrant such action."515 
2.187  Australia contends that "New Zealand's description of such systems audits516 accords with 
Australia's view of its requirement and accordingl y there is no live dispute with respect to this 
measure."517 
2.188  In response, New Zealand points out that "any type of AQIS involvement in orchard 
inspections for European canker and fire blight, in  direct verification of packing house procedures, 
and in fruit inspection and treatment for ALCM is without scientific support, and accordingly there is 
very much a live dispute between the parties."518  New Zealand adds that: 
"AQIS involvement is contrary to Article 2.2 because that involvement is aimed at 
verifying requirements that are themselves in consistent with Article 2.2 – for example 
in this case, orchard inspections for fire  blight and European canker, and the 
requirements on packing houses for fire blight imposed by the IRA. As the 
underlying measures are inconsistent with the SPS Agreement , it follows that any type 
of AQIS involvement in or supervision of those measures would also be inconsistent 
with the SPS Agreement .  No amount of redefining of the measure by Australia can 
                                                      
510 Australia's reply to Panel question 106 after the first substantive meeting. 
511 Australia's reply to Panel question 110 after the second substantive meeting, para. 488. 
512 Ibid. 
513 (footnote original) Final IRA Report, p. 325. 
514 Australia's closing oral statement at the first substantive meeting of the Panel with the Parties, 
para. 34. 
515 Australia's IRA, Part B, p. 325. 
516 (footnote original) See:  New Zealand's first wr itten submission, para. 4.527. 
517 Australia's first written submission, para. 166.  S ee also Australia's opening oral statement at the 
first substantive meeting of the Panel with the Parties, 22. 
518 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 27. WT/DS367/R 
Page 64  
 
 change this.  Accordingly, there is very  much a live dispute with respect to ... 
[M]easure [15]."
519 
2.189  New Zealand also adds that it "does not agree with Australia's characterisation of 
'AQIS involvement' and its attempt to equate th is with a systems audit within New Zealand's 
understanding of the term."520  As regards systems audits, New Zealand states that "[a] systems audit 
involves an official coming from the country's quarantine agency to New Zealand to audit 
New Zealand systems, including policies, procedures and actual site visits."521  New Zealand argues 
that "a 100% audit of survey teams and packing houses in the first year by the officials of an importing country does not conform to any notion of a systems audit as understood by New Zealand."
522 
2.190  In contrast to Australia, New Zealand consider s that the "Audit" section of the IRA is not 
related to Measure 15: 
"The requirement that AQIS officers be i nvolved in orchard inspections for European 
canker and fire blight, in direct verification of packing houses and in fruit inspection is set out under the heading 'requirement fo r pre-clearance'. This is separate from the 
section of the IRA entitled 'audit'. These are two different sections and neither 
mention 'systems audits'."
523 
New Zealand adds that "there was no refe rence to a 'systems audit' in the IRA"524 at all, and argues 
that that "the AQIS involvement measure appears to  be based on an assumption that the usual auditing 
systems will be insufficient to meet th e risk posed by New Zealand apples."525 
2.191  New Zealand also contests whether "there has been clarification around the level of AQIS 
involvement [as] [n]either the draft work plan nor the SOP provides further clarity on the level of 
involvement of AQIS officers."526  New Zealand points out that "Australia itself conceded in its first 
written submission 'the level and precise nature of  "AQIS involvement" was not well defined in the 
Final IRA Report.'527"528 
2.192  Accordingly, New Zealand confronts the rele vant portions of the IRA with Australia's 
subsequent explanations during these proceedings: 
"[W]hereas Australia's first written submissi on now refers to an audit of '100% of 
survey teams in the field,'529 the IRA referred to '[AQIS involvement] in orchard 
                                                      
519 New Zealand's reply to Panel question 46 after the first substantive meeting.  See also, 
New Zealand's second written submission, p. 13. 
520 New Zealand's reply to Panel question 46 after the first substantive meeting.  See also, 
New Zealand's second written submission, para. 2.22. 
521 New Zealand's first written submi ssion, para. 4.526, footnote 446. 
522 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 27. 
523 New Zealand's reply to Panel question 46 after the first substantive meeting.  See also 
New Zealand's second written submission, para. 2.23. 
524 New Zealand's second writte n submission, para. 2.23. 
525 New Zealand's reply to Panel question 109  after the second substantive meeting. 
526 New Zealand's reply to Panel question 50  after the first substantive meeting. 
527 (footnote original)  Australia's first written submission, para 151.  See also ARPQ, Q 47, p. 36 which 
stated that "elements [of the m easure] required clarification". 
528 New Zealand's second writte n submission, para. 2.23. 
529 (footnote original)  Australia's first written submission, para. 151.  WT/DS367/R 
 Page 65 
 
 
 inspections for European canker and fire blight.'530 Rather than an audit of 'all 
relevant packing houses,'531 the IRA referred to '[AQIS involvement] in direct 
verification of packing house procedures, and in fruit inspection'532 and 'supervision' 
by AQIS officers of procedures in the packing house, including fumigation treatments.
533 Further, although Australia's first written submission now suggests that 
with respect to audits of survey teams the level of scrutiny may decline from 100% 
over time 'based on performance'534, the IRA was entirely silent on this point. 
New Zealand also notes that there is no explicit clarification in Australia's first written submission in relation to performan ce-based audits of New Zealand packing 
houses.
535"536 
New Zealand adds that "[t]he lack of clarity in the IRA with respect to this requirement is also 
reflected in the varied views of the experts as to what exactly 'AQIS involvement' might entail.537"538  
2.193  New Zealand also disagrees with Australia as regards equating pre-clearance arrangements 
with standard on-arrival border procedures.  New Zealand argues that, in the context of other fruit: 
"Current standard pre-clearance arrangements are voluntary on the part of 
New Zealand fruit export industries, which i nvite and pay for AQIS officers to come 
to New Zealand to perform their sta ndard on-arrival border inspections on 
New Zealand certified product.539  However, the suggestion that the 'standard pre-
clearance arrangements' be extended beyo nd the on-arrival border procedures to, for 
example, involvement in field inspections for European canker and fire blight, is 
entirely novel."540 
2.194  New Zealand argues that: 
"None of the explanations suggest less than 100% intensity for the AQIS inspections.  
... In New Zealand's view a 'systems audit' has never involved an audit of each survey team, even in the first year. New Zealand al so notes that Australia is not prepared to 
rule out audits of 100% of survey teams in subsequent years."
541 
                                                      
530 (footnote original)  IRA, p. 314. 
531 (footnote original)  Australia's first written submission, para. 151. 
532 (footnote original)  IRA, p. 314. 
533 (footnote original)  In respect of ALCM, under "Option 1:  Inspection with Treatment", the IRA 
stipulates at p. 320 that "Under pre-clearance  arrangements AQIS would be involved in the supervision of these 
procedures " (emphasis added).  "These procedures" includes the requirement that, "where any live 
quarantinable arthropod is found the lot must be subjected to an appropriate treatment (for example, 
fumigation) or rejected for export." (Emphasis added.) 
534 (footnote original)  Australia's first written submission, para. 151. 
535 (footnote original)  Australia's first written submission, para. 151. 
536 New Zealand's second writte n submission, para. 2.23. 
537 (footnote original)  Experts' RPQ [responses to Panel questions], Qs 4, 5. 
538 New Zealand's second writte n submission, para. 2.24. 
539 (footnote original)  As required for all exports, the product is inspected by MAF approved inspectors 
and, if appropriate, issued with a phytosanitary certificate.  Following this, the product is inspected by AQIS 
officials as per their normal post-border procedures (as if it had arrived in Australia). 
540 New Zealand's reply to Panel question 51  after the first substantive meeting. 
541 New Zealand's comments on Australia's reply to Panel questions 105-106 after the second 
substantive meeting. WT/DS367/R 
Page 66  
 
 2.195  New Zealand also notes "Australia's ... reluctance  in its comments on experts' replies to rule 
out the possibility that the aud itor 'may observe and question an entire survey team  to satisfy 
themselves that there was an appropriate level of competence'.
542"543 
2.196  New Zealand argues that "[a]udits of 100% of survey teams and packing houses in the first 
year are not systems audits within New Zealand' s definition of the term, nor with international 
practice"544, and it makes reference to a document concerning ISPM 20: 
"[The] IPPC, 'Explanatory Document 1 on International Standard for Phytosanitary 
Measures No. 20 (Guidelines for a Phytosanitary Import Regulatory System)', p 8 states: 
'Audit and compliance checking by the N PPO of the country of import should 
thus be considered a verification pr ocess, confirming that procedures are 
appropriate, effective, and being pr operly applied.  This should not 
necessitate 100% inspection either of individual consignments or of all 
consignments in a particular trade but rather some form of sampling process.  As confidence grows in the procedures related to, for example, a particular 
trade the intensity of inspection should be reduced.'"
545  New Zealand adds 
that "ISPM 20 … support[s] … its view that an audit requires 'some sort of sampling process' of relevant systems."
546 
2.197  In response to New Zealand, Australia argues th at its explanation of its measure concerning 
"AQIS involvement" was provided in goo d faith and should thus be accepted.547  Australia also 
comments that it does not believe any of the experts have the knowledge to assist the Panel on this 
matter.548 
2.198  As regards ISPM No. 20, Australia argues that its  "explanations of the systems audits that will 
be conducted by AQIS officers cannot be interpre ted to amount to 100% inspection of individual 
consignments or of all consignments, as New Zealand has implied."549  Also, Australia quotes ISPM 
No. 20 and argues that "New Zealand fails to acknowledge that ISPM No. 20 itself specifically 
recognises that 'audit of procedures in the exporti ng country' may be required in the context of 
measures to address phytosanitary risks.550"551  Accordingly, Australia considers that its requirement 
pertaining to "AQIS involvement" falls within the scope of what is envisaged by ISPM No. 20.552 
                                                      
542 (footnote original)  ACER [Australia's comments on experts' responses], para 283. 
543 New Zealand's comments on Australia's reply to Panel question 110 after the second substantive 
meeting. 
544 New Zealand's reply to Panel question 52 after the first substantive meeting (footnote omitted).  See 
also New Zealand's reply to Panel question 46 after the first substantive meeting. 
545 New Zealand's reply to Panel question 52 afte r the first substantive meeting, footnote 50. 
546 New Zealand's comments on Australia's reply to Panel questions 105-106 after the second 
substantive meeting (footnote omitted). 
547 Australia's second written submission, para. 722.  See also Australia's first written submission, 
paras. 150-151, 962 and 1107;  Australia's reply to Panel's questions 47, 48, 49, 50, 51 and 52 after the first substantive meeting;  Australia's comments on the experts'  replies, paras. 281-286;  Australia's second written 
submission, p. 218. 
548 Australia's second written submission, para. 722. 
549 Australia's second written submission, para. 724. 
550 (footnote original)  Exhibit AUS-170:  IPPC, Guidelines for a Phytosanitary Import Regulatory 
System  (2004), (ISPM No. 20), p. 236. 
551 Australia's second written submission, para. 725. 
552 Ibid.  WT/DS367/R 
 Page 67 
 
 
 (ii) The Panel's analysis 
2.199  At the outset of its analysis, the Panel notes as a factual point that there continues to be an 
ongoing dispute between the Parties on Measure 15.  Th is is illustrated by the Parties' repeated 
exchanges of arguments throughout these proceedings on the exact nature of Measure 15.  But even if 
the Parties had been able to agree on the nature of  Measure 15, a dispute would remain between them 
with regard to the justification of that measure.  In fact, as New Zealand – the complainant – indicates, 
there is an ongoing dispute independently  of the exact nature of Measure 15: 
"Any type of AQIS involvement in orchard inspections for European canker and fire 
blight, in direct verification of packing house procedures, and in fruit inspection and treatment for ALCM is without scientific support, and accordingly there is very much 
a live dispute between the parties."
553 
New Zealand adds that the underlying measures them selves are inconsistent with the SPS Agreement, 
so any AQIS involvement in, or supervising of, thos e measures would also be inconsistent with the 
SPS Agreement and "[n]o amount of redefining of the measure by Australia can change this."554 
2.200  As regards the nature of Measure 15, the Pa nel's obvious starting point is New Zealand's 
panel request, which determines the Panel's terms of  reference, including the measures under review.  
New Zealand's panel request identifies Measure 15 as: 
"The requirement that Australian Quarantine 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."
555 
2.201  New Zealand challenges this measure (and the other measures at issue) as spelt out in the 
IRA.556  In fact, New Zealand makes reference to the section of the IRA entitled "Requirement for 
pre-clearance"557, which contains specific language identical to New Zealand's description of 
Measure 15, save as regards New Zealand's reference in its panel request to the word "treatment" at 
the end.  In its pre-clearance section, the IRA pr ovides that "under the[] [pre-clearance] arrangements 
AQIS officers would be involved in orchard inspections  for European canker and fire blight, in direct 
verification of packing house procedures, and in fruit inspection."558 
2.202  Australia does not call into ques tion the description of Measure 15,  including the reference to 
"treatment", in New Zealand's pane l request.  In fact, Australia id entifies the above-cited sentence in 
the pre-clearance section of the IRA as the origin of  the relevant language in New Zealand's panel 
                                                      
553 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 27. 
554 New Zealand's reply to Panel question 46 after the first substantive meeting.  See also 
New Zealand's second written submission, p. 13. 
555 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Anne x A-1 to this report, p. 3. 
556 Ibid., p. 1.  See also the Panel's preliminary ruling, made publicly available in Australia – Apples , 
Communication from the Chairman of the Panel:  Preliminary Ruling by the Panel (WT/DS367/7), 23 June 
2008, attached as Annex A-2 to this report, para. 13(a). 
557 New Zealand's first written submi ssion, para. 3.83, footnote 92. 
558 Australia's IRA, Part B, p. 314. WT/DS367/R 
Page 68  
 
 request.
559  Also, New Zealand argues that fruit inspection and treatment are specifically relevant for 
ALCM, as the IRA refers to AQIS involvement in these steps.560 
2.203  New Zealand adds that: 
"In respect of ALCM, under 'Option 1: Inspec tion with Treatment', the IRA stipulates 
at p. 320 that 'Under pre-clearance arra ngements AQIS would be involved in the 
supervision of these procedures ' (emphasis added). 'These procedures' includes the 
requirement that, 'where any live quarantinable arthropod is found the lot must be subjected to an appropriate treatment (for example, fumigation) or rejected for 
export.' (Emphasis added.)"
561 
2.204  In light of the above and New Zealand's right as complainant to identify Measure 15 in its 
panel request, the Panel finds no reason to exclud e AQIS involvement in "treatment" from the scope 
of Measure 15. 
2.205  Australia recognizes that the relevant parts of  the IRA might require further clarification.562  
Of course, the Panel needs to take into consider ation all the arguments and evidence submitted by the 
Parties.  Nonetheless, in its analysis of the natu re of Measure 15, the starting point for the Panel's 
analysis remains the IRA.  It is the IRA that spells  out Measure 15 in detail, and it is the IRA that the 
Panel needs to review in this dispute. 
2.206  The main issues of disagreement between the Part ies as regards the nature of Measure 15 is 
whether it involves audits, whether it amounts to syst ems audits as identified by the Parties, and 
whether it entails 100 per cent involvement by AQIS officers.  The Panel notes that the above core description of Measure 15 in the pre-clearance section of the IRA, referenced by New Zealand, does 
not explicitly mention audits or systems audits .  It talks in an unqualified manner about the 
involvement of AQIS inspectors in two types of activities:  (i) inspections, namely inspection of orchards for European canker and fire blight, and in spection of fruit;  and (ii) "direct" verification of 
packing house procedures.  In regard to the latte r, the IRA states that AQIS officers will be involved 
in the direct verification of packing house pro cedures, but the IRA does not say that this would 
necessarily entail AQIS audits. 
2.207  The direct involvement of AQIS officers is under scored by the explicit language to that effect 
in the first sentence of the IRA's pre-clearance section: 
"[A]t least for initial trade, the quarantin e measures operate through a standard pre-
clearance arrangement with AQIS officers being directly involved."
563 
2.208  These core sentences of the IRA with regard to Measure 15 do not explain whether this direct 
involvement of AQIS would be 100 per cent or less.   Through their unqualified language they do not 
exclude 100 per cent involvement of AQIS officers at all. 
2.209  In the other parts of the IRA's pre-clearance section, only one sentence makes reference to 
audits: 
                                                      
559 Australia's reply to Panel question 48 after the first substantive meeting. 
560 New Zealand's second written submission, 2.23, re ferring to Australia's IRA, p. 314.  See also 
New Zealand's opening oral statement at the first substa ntive meeting of the Panel with the Parties, para. 27. 
561 New Zealand's second written subm ission, para. 2.23, footnote 28. 
562 Australia's first written submission, 150. 
563 Australia's IRA, Part B, p. 314.  WT/DS367/R 
 Page 69 
 
 
 "The involvement of AQIS officers in pre- clearance would also facilitate a rigorous 
audit of other arrangements including regi stration procedures, standard commercial 
practice, traceability, and handling export fruit in a secure manner."564 
2.210  Importantly, this sentence refers to the "facilitation"565 of audits, without stating that 
pre-clearance itself would involve audits.  Also, it refers to a "rigorous audit", implying that any 
potential overlap between pre-clearance and audit w ould not weaken but rather strengthen audit by 
AQIS.  Furthermore, the pre-clearance section of the IRA refers to for the first time pre-clearance as 
"pre-clearance arrangement"566, and introduces the sentence immediat ely preceding the one relating to 
audits with the words "[u]nder these arrangements".567  Accordingly, the reference to "other 
arrangements"568 in the sentence referring to audit implies th at audit would concern measures different 
from pre-clearance.  These points appear to distinguish pre-clearance from audit. 
2.211  Turning to the section of the IRA entitled "Audit", invoked by Australia in the context of 
Measure 15, the Panel notes that this section is separate from the pre-clearance section, although it 
immediately follows the latter. 
2.212  This audit section of the IRA makes various refe rences to pre-clearance.  One sentence in that 
section mentions that "[a]udits may be conducte d at the discretion of AQIS during the entire 
production cycle and as a component of any pre-clearance arrangement."569  This would seem to 
suggest that pre-clearance arrangements may include audits as a component, although the IRA does 
not say that it will be necessarily the case.  Furt her, under the audit section, audit extends to 
participants in pre-clearance arrangements, although it relates to auditing the integrity of pre-clearance 
arrangements and participants' comp liance with such arrangements: 
"Participants in pre-clearance arrangeme nts will be audited by AQIS during the 
season to verify that requirements such as the following continue to be met: 
• There is an effective approved documented system in operation, including product 
identification and labelling at each facility to ensure that pre-cleared and non pre-
cleared products are kept separate. 
• At any time pre-cleared product is moved, the transport systems used maintains the 
integrity of the pre-cleared product. 
• Appropriate records are maintained fo r all pre-cleared product in storage."570 
2.213  As regards the scope of audit, under the aud it section of the IRA, AQIS audit concerns the 
"apple production and certification system"571, and it "will be conducted to measure compliance with 
packing house responsibilities, traceability, la belling, segregation and product security, and 
MAFNZ/Agency certification processes."572  Further, "AQIS field audits will measure compliance 
with orchard registration, bloc k identification, pest/disease management/monitoring, records 
management, and the administration of the area freedom and accreditation requirements."573  A s  
                                                      
564 Australia's IRA, Part B, p. 314. 
565 Ibid. 
566 Ibid. 
567 Ibid. 
568 Ibid. 
569 Ibid. 
570 Australia's IRA, Part B, pp. 314-315. 
571 Australia's IRA, Part B, p. 314. 
572 Ibid. 
573 Ibid. WT/DS367/R 
Page 70  
 
 indicated above, pre-clearance arrangements entail direct AQIS involvement in orchard inspections 
for European canker and fire blight, in direct veri fication of packing house procedures, and in fruit 
inspection. 
2.214  The Panel cannot exclude that the scope of a udit set out in the "Audit" section of the IRA 
might have some, partial overlap with the scope of  pre-clearance arrangements.  However, the IRA 
does not specifically explain that relationship, nor does it indicate that any such relationship would 
imply a specific link between audit and pre-clearance. 
2.215  In light of the above, the Panel finds as a factual point that Measure 15 is clearly linked to the 
section of the IRA entitled "Requirement for pre-cl earance", as invoked by New Zealand.  The Panel 
notes also that the IRA does not explicitly exclude th at at least certain aspects of Measure 15 may be 
linked to the audit section of the IRA, or involve so me audit by AQIS officers;  however, any linkages 
spelt out in the IRA in that regard are not suffici ently clear, explicit or unconditional to establish that 
Measure 15 would necessarily involve any audit by AQIS officers. 
2.216  This is underscored by Australia's arguments th at try to link the audit section of the IRA and 
AQIS audit to Measure 15.  In fact, in its respon se to a question by the Panel, Australia emphasizes 
that AQIS audit would be undertaken separately: 
"[T]he reference to orchard inspections a nd verification of packing house procedures 
in [Measure 15] should be taken to be linked to auditing requirements which AQIS 
officials may separately  undertake while present in New Zealand to conduct pre-
clearance."
574 
2.217  Likewise, in response to another question: 
"Australia explained that 'pre-clearance' means that activities are undertaken outside 
Australia to meet Australia's usual on-a rrival verification requirements, which are 
separate to auditing requirements.  AQIS o fficials present in New Zealand to conduct 
pre-clearance will separately  conduct systems audits."575 
2.218  Further, in trying to link the pre-clearance and audit sections of the IRA to each other and to 
Measure 15, Australia highlights certain key differe nces between the nature of the requirements under 
those two sections: 
"In the Final IRA Report, the distinction betw een 'pre-clearance' and 'audit' is made to 
indicate that AQIS officers' involvement in  orchard inspections for European canker 
and fire blight, in direct verification of packing house procedures and in fruit inspection is mandatory. Audit of othe r components of the New Zealand apple 
production and certification system may be conducted at the discretion of AQIS."
576 
2.219  Another difference between the pre-clearance and audit sections of the IRA flows from the 
potentially transitory nature of pre-clearance arra ngements and the uncertainty regarding the timing 
and criteria for its eventual phasing out under the IRA. 
2.220  As regards the length of time during which th e pre-clearance arrangements would apply and 
the exact criterion for their phasing out, the pre-cl earance section of the IRA explains that pre-
                                                      
574 Australia's reply to Panel question 48 after the first substantive meeting (original emphasis). 
575 Australia's reply to Panel question 47 after the first substantive meeting (original emphasis). 
576 Australia's reply to Panel question 101 after the second substantive meeting.  WT/DS367/R 
 Page 71 
 
 
 clearance arrangements would apply " at least  for initial trade"577, and that "[t]he need for pre-
clearance would be reassessed after experience ha d been gained following significant trade."578  
Neither "initial trade" nor "significant trade" are defined by the IRA. 
2.221  The section of the IRA entitled "Verification of documents and inspection on arrival where 
pre-clearance is not used" starts by repeating the "i nitial trade" criterion and refers, in a rather vague 
manner, to possible changes to pre-clearance arrangements: 
"It is recommended that, at least for initial trade, pre-clearance be  used (see above).  
However, it is possible that this re quirement may change in the future."579 
2.222  Further, the section of the IRA entitled "Review of import conditions" provides that: 
"It is recommended that Biosecurity Australia and AQIS in consultation with 
MAFNZ, will review the import requirements after the first year of trade.  
Further reviews will occur if circumstances or information warrant such action."580 
2.223  As Australia argues581, this review at the end of the first year might involve a review or phase-
out of pre-clearance arrangements ;  however, it will not necessarily do so.  In fact, the Panel cannot 
exclude that the pre-clearance arrangements might  be phased out directly, and separately from the 
review of import conditions. 
2.224  Under the IRA, Australia's consent is indispensable for phasing out pre-clearance 
arrangements either directly or in the framework of  a review of import conditions.  In light of the 
uncertainty of the exact criteria and timing of the phase-out, the IRA accords wide discretion to 
Australia for eventually phasing out pre-clearance arrangements.  It also appears from the above 
sections of the IRA that pre-clearance arrangements w ould be – at least potentially – transitory.  This 
potentially transitory nature of pre-clearance arra ngements and the uncertainty regarding the timing 
and criteria for its eventual phasing out under the IRA constitutes a further difference between the 
pre-clearance arrangements and the requirements spelt out in the audit section of the IRA. 
2.225  The above uncertainties with regard to the IR A in the context of Measure 15 are underscored 
by the IRA's requirement that the details of pre-cl earance be addressed by the Parties in the operating 
manual and work plan, but which has not yet been adopted.  According to the IRA: 
"It is a requirement that MAFNZ or the registered agency prepare a documented 
standard operating procedure (SOP) or ma nual that describes the phytosanitary 
procedures for each of the pests of quaran tine concern for Australia and the various 
responsibilities of all parties involved in meeting this requirement.  The operating 
procedure must be approved by AQIS befo re exports commence and will be subject 
to audit by AQIS. 
A draft work plan will be develope d between DAFF and MAFNZ following the 
finalisation of this IRA. 
The work plan procedures may include, but are not limited to operational details on: 
                                                      
577 Australia's IRA, Part B, p. 314 (emphasis added) .  See also Australia's IRA, Part B, p. 325. 
578 Australia's IRA, Part B, p. 314. 
579 Australia's IRA, Part B, p. 325. 
580 Ibid. 
581 Australia's closing oral statement at the first su bstantive meeting of the Panel with the Parties,, 
para. 34. WT/DS367/R 
Page 72  
 
 • inspection and sampling methodology 
• pre-clearance arrangements 
• maintenance and supply of records 
• storage segregation and identification of lots, and 
• dealing with rejected lots. [sic] 
• details on standard commercial practice."
582 
2.226  Although the "operating procedure must be approved by AQIS"583, according to the IRA it 
needs to be prepared by New Zealand.  Likewi se, under the IRA the work plan does not depend only 
on Australia but it needs to be developed jointly by both Parties, including New Zealand.  The 
Panel appreciates Australia's forthcoming offer du ring the proceedings to specify what Measure 15 
might involve in detail in light of earlier discussions between the Parties to prepare the standard operating procedures.
584  However, to the extent that New Zealand – the complainant – has not 
accepted those explanations during the proceedings or  the Parties have not agreed on the standard 
operating procedures and work plan, the Panel cannot  be certain that the final version of those 
documents would include the same requirements wi th regard to Measure 15 as the ones offered in 
Australia's explanations.585 
2.227  The pre-clearance section of the IRA does not specify the frequency or intensity of the 
involvement of AQIS officers in Measure 15.  At the same time, it spells out the direct involvement of AQIS officers in unqualified language, a nd it is silent on any further deta ils of that involvement.  This 
certainly does not exclude a 100 per cent involvement, i.e. that during initial trade AQIS officers 
would be involved in all orchard inspections for European canker and fire blight, in all direct 
verification of packing house procedures, and in all fr uit inspection.  Australia recognizes that this is a 
possibility under the IRA, at least as regards certai n elements of Measure 15, although Australia also 
argues that this would be exceptional. 
2.228  The Panel notes that Part A of the IRA summari zes the conclusions of the IRA in relevant 
part as follows: 
"This final report recommends that the importation of apples to Australia from 
New Zealand be permitted, subject to th e following risk management conditions: 
• Mandatory pre-clearance arrangements with Australian Quarantine and Inspection 
Service officers involved in all risk management measures in New Zealand and 
auditing of the systems and processes used by New Zealand to certify exports."
586 
2.229  As mentioned above, Australia argues that  pre-clearance is mandatory whereas the 
requirements set out in the audit section of the IRA are at the discretion of AQIS.587  Accordingly, 
only the first part of the above bullet point summary  in Part A of the IRA could relate to the pre-
                                                      
582 Australia's IRA, Part B, pp. 313-314. 
583 Australia's IRA, Part B, p. 313. 
584 Australia's reply to Panel questions 105 and 106 after the second substantive meeting. 
585 See for example, New Zealand's comments on Austra lia's responses to the Panel's questions 105 and 
106 after the second substantive meeting, paras. 250-254. 
586 Australia's IRA, Part A,  p. 1 (emphasis added). 
587 Australia's reply to Panel question 101 after the second substantive meeting, para. 454.  WT/DS367/R 
 Page 73 
 
 
 clearance section of the IRA, while the second part of the same bullet point summarizes the 
requirements set out in the audit section of the IRA. 
2.230  The first part of the above bullet point summary in Part A of the IRA indicates that, under the 
pre-clearance arrangements, AQIS officers would be involved in all pre-clearance-related risk 
management measures in New Zealand.  Based on this language in the IRA, Measure 15 seems to 
entail the involvement of AQIS officers in all orchar d inspections for European canker and fire blight, 
in all direct verification of packing house procedur es, and in all fruit inspection and treatment.  At the 
same time, the Panel is aware that the IRA does not provide a full picture on Measure 15.  In light of 
the details on Measure 15 offered by Australia dur ing these proceedings, the Panel could imagine – 
although it cannot be certain at this point – that in its final form Measure 15 will not entail AQIS 
involvement in all measures related to pre-clearance arrangements. 
2.231  As regards the Parties' differences on whether Measure 15 equals systems audits, the Panel 
notes that the neither the pre-clearance nor the audit part of the IRA mention systems audits.  Part A 
of the IRA summarizes the requirements in the audit section of the IRA as the "auditing of the systems  
and processes used by New Zealand to certify exports."588  Nevertheless, this summary does not 
explain in detail whether the requirements set out in the audit section of the IRA would effectively 
amount to a systems audit as understood by the Parties.   In any event, as stat ed earlier, it is unclear 
from the IRA whether Measure 15 relates also to the audit section of the IRA, and the Parties have not 
finalized the work plan and operating procedures.  A ccordingly, it remains impossible for the Panel to 
establish also whether Measure 15 would include sy stems audits as understood by the Parties.  The 
Panel notes that this issue is more directly rela ted to New Zealand's claim under Article 5.6 of the 
SPS Agreement. 
6. Territorial applicability of the measures at issue 
2.232  The IRA assesses the three pests at issue "for the whole of Australia".589  Accordingly, the 
measures spelt out in the relevant parts of the IRA in  regard to those pests apply to apple exports from 
New Zealand to the entire territory of Australia.590 
7. Legal issues to be addressed in the findings section of the report 
2.233  The Panel notes there are various further issues of disagreement between the Parties as 
regards the measures that are at i ssue in this dispute, such as: 
(a) Whether all of the 16 specific measures qualify as SPS measures; 
(b) Whether New Zealand has the right to c ontest each of the 16 specific measures 
individually or only as a whole, including whether some measures should be 
addressed together as part of a "systems" approach;  and, 
(c) Whether, as Australia argues, some of those measures are "ancillary" to some other, 
allegedly "principal" measures. 
These issues are more relevant for the eventual lega l review of the measures at issue than for the 
determination of which measures are at issue in the dispute and precisely what some of these 
                                                      
588 Australia's IRA, Part A,  p. 1 (emphasis added). 
589 Australia's IRA, Part B, p. 47.  See also Ibid., pp. 48-49. 
590 The IRA addressed some other pests and recommended certain measures only for Western 
Australia, these measures and the pests to which they relate that are not at issue in this dispute.  See Australia's 
IRA, Part B., pp. 239-310, and 324. WT/DS367/R 
Page 74  
 
 measures might entail.  Accordingly, the Panel w ill address these issues in the findings section of the 
report. 
2.234  A further question related to measures at issue is whether the "IRA process" as a whole is a 
measure within the purview of this Panel.  Au stralia contests this in the specific context of 
New Zealand's claim under Article 8 and Annex C(1)(a) of the SPS Agreement.
591  It is in the legal 
review of that claim that the Panel will address this question. 
E. PRODUCT AT ISSUE  
1. The Parties' arguments 
2.235  The Parties have discussed at length the pr oduct at issue throughout these proceedings. 
2.236  In principle, both Parties agree that the product at issue should be determined by the Panel's 
terms of reference, as containe d in New Zealand's panel request592 and adopted by the DSB.  
New Zealand's panel request refers in gene ral terms to the "importation of apples from 
New Zealand"593 to Australia. 
2.237  Despite the Parties convergence on the relevance of the panel's request for determining the 
product at issue, they express differences on the impor tance in this regard of the maturity, freedom 
from trash, symptomless nature and the mode of trade of apples. 
2.238  In its first written submission, New Zealand states that the product at issue in this dispute is 
apples imported from New Zealand into Australia, as  described in the Panel's terms of reference.594  
But New Zealand adds that "[i]n practice, [New Zealand] would export mature, symptomless apples 
to Australia"595 because: 
"The IRA requires, as a condition of entry, that all New Zealand apples must meet the 
'class 1 export quality fruit' standard in  respect of the presence of wounds and 
maturity596 and must be free of trash.597  Such a standard would be consistent with 
practice in the export of apples from New Zealand, and in bringing this case 
New Zealand made no challenge to  this type of requirement."598 
2.239  New Zealand repeatedly states that its argum ents focus on the product actually exported599, 
namely, mature, symptomless apples.600 
                                                      
591 See, for example, Australia's first written submi ssion, paras. 1117-1126;  Australia's second written 
submission, paras. 184-218. 
592 New Zealand's reply to Panel question 1 after the first substantive meeting, para. 2;  Australia's reply 
to Panel question 1 after the first substantive meeting, p. 1. 
593 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A-1 to this report. 
594 New Zealand's first written submission, para. 3.44 ;  New Zealand's opening oral statement at the 
first substantive meeting of the Panel with the Parties, para. 23;  New Zealand's reply to Panel question 1 after 
the first substantive meeting, para. 2, and Panel ques tion 2 after the first substantive meeting, para. 5. 
595 New Zealand's first writte n submission, para. 3.44. 
596 (footnote original ) IRA, p. 315. 
597 (footnote original ) IRA, p. 318. 
598 New Zealand's first writte n submission, para. 3.45. 
599 New Zealand's reply to Panel question 2 afte r the first substantive meeting, para. 5. 
600 New Zealand's reply to Panel question 10 afte r the second substantive meeting, para. 20.  WT/DS367/R 
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 2.240  In response, Australia argues that "New Zealan d's attempt to character ize the product at issue 
as 'mature, symptomless apples' should be dismissed."601  Australia adds that the Panel would commit 
a legal error by defining the product at issue as "mature, symptomless apples"602  because the "term 
'symptomless' could be misinterpreted as sugges ting that New Zealand would only export 'risk-free 
goods' without requiring New Zealand to prove this."603  In Australia's view, even if apples are 
"symptomless", this does not necessarily mean that they  are pest free:  apples latently infected with 
European Canker or carrying fire blight bacteria are by definition "symptomless".604 
2.241  Australia argues that "[t]he product at issue in this dispute should be de termined by reference 
to the scope of the Final IRA Report".605  Australia points out that New Zealand's panel request cites 
the policy determination of the Australian Direct or of Animal and Plant Quarantine concerning the 
importation of apples from New Zealand, subjecting the importation of apples into Australia to the 
requirements of the IRA.606  In Australia's view, that reference in New Zealand's panel request defines 
the product at issue by linking it to the product considered in the IRA.607  Since the IRA's scope is 
"mature apple fruit free of trash, either packed or  sorted and graded bulk fruit from New Zealand"608, 
Australia argues that the product at issue should be defined in the terms used in the IRA and not as 
"mature, symptomless apples".609 
2.242  In response, New Zealand contends that there is no practical difference between the apples 
actually exported to Australia and those under the scope of the IRA.610  Nevertheless, New Zealand 
states that it is not appropriate to determine the prod uct at issue by reference to the scope of the IRA, 
but rather that it should be defined by the panel's terms of reference611 as "apples imported from 
New Zealand into Australia."612  In New Zealand's view, limiting the product at issue by reference to 
the scope of the IRA "would effectively allow a Member undertaking an IRA to exclude certain 
elements from review by a dispute settlement panel si mply by defining the scope if its investigations 
in a particular way."613  At the same time, as noted, New Zealand points out that its arguments focus 
on the product actually exported, namely mature, symptomless apples.614 
2.243  The Parties also discuss the relevance of the mode of trade of apples for the purposes of 
defining the product at issue.  New Zealand asserts that "[t]he mode of trade does not have 
implications for the definition of the 'product at i ssue', which is determined by the Panel's terms of 
reference."615  Australia on the other hand, argues that the product at issue is defined by the IRA and 
                                                      
601 Australia's reply to question 1, p. 3. 
602 Australia's reply to Panel question 15 after the second substantive meeting, paras. 50-51. 
603 Australia's reply to Panel question 3 after the first substantive meeting, p. 4. 
604 Ibid. 
605 Australia's first written submission, para. 123. 
606 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A-1 to this report. 
607 Australia's reply to Panel question 1 after the first substantive meeting, pp. 1-3. 
608 Australia's IRA, Part B, p. 9.  See Australia's reply to Panel question 1 after the first substantive 
meeting, pp. 1-3. 
609 Australia's reply to Panel question 1 after the first substantive meeting, pp. 1-3;  Australia's second 
written submission, para. 81-83. 
610 New Zealand's reply to Panel question 10 afte r the second substantive meeting, para. 20;  
New Zealand's first written submission, para., 2.33. 
611 New Zealand's reply to Panel question 1 afte r the first substantive meeting, para. 2. 
612 Ibid., citing in support Australia – Apples , Request for the Establishment of a Panel by New Zealand 
(WT/DS367/5), 7 December 2007, attach ed as Annex A-1 to this report. 
613 New Zealand's reply to Panel question 1 afte r the first substantive meeting, para. 1. 
614 New Zealand's reply to Panel question 10 afte r the second substantive meeting, para. 20. 
615 New Zealand's reply to Panel question 8 afte r the first substantive meeting, para. 12. WT/DS367/R 
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 that "[t]he mode of trade, namely packed fruit or bulk fruit, is an important aspect of this definition 
and therefore determines the product at issue."
616 
2. The Panel's analysis 
2.244  The Panel's task is to define the scope of the dispute with regard to the product at issue.  
According to established jurisprudence, it is the panel' s terms of reference that "define the scope of [a] 
dispute."617  In turn, a panel's mandate or terms of re ference are determined by the request for the 
establishment of the panel.618  The panel request constitutes the "ma tter referred to the DSB", which in 
turn forms the basis of a panel's terms of refere nce under Article 7.1 of the DSU.  To define the 
product at issue, the Panel must thus  refer to its terms of reference. 
2.245  New Zealand's panel request refers to "t he importation of apples from New Zealand"619 into 
Australia.  Thus, the panel request determines the product at issue in general terms, without any 
qualifications.  In particular, the request does not refer to either "mature, symptomless apples", or 
"mature apple fruit free of trash, either p acked or sorted and graded bulk fruit". 
2.246  The Panel recalls the argument of Australia that  the product at issue should be defined by the 
IRA, and that the mode of trade, namely packed fruit or bulk fruit, is an important aspect of this 
definition and therefore determines the product at issue. 
2.247  The measures at issue identified in the panel requ est are contained in the IRA, also referenced 
by the panel request.620  As noted by Australia, the IRA states th at "[t]he scope of [its] analysis is the 
importation of mature apple fruit free of trash, eith er packed or sorted and graded bulk fruit from 
New Zealand."621  At the same time, the IRA applies to apples produced in New Zealand and to be 
exported to Australia.  Indeed, th e IRA is entitled "Final Import Risk Analysis Report for Apples from 
New Zealand", without any qualification.  Part A of  the IRA, summarizes the overall conclusions of 
the IRA by referring to New Zealand apples in equa lly general terms:  "This final report recommends 
that the importation of apples to Australia from New Zealand be permitted, subject to the following risk management conditions."
622  The applicability of the IRA to apples from New Zealand destined to 
Australia is acknowledged by both Parties.  Austra lia states that "[a]ny apples proposed for export 
from New Zealand to Australia would be subject to the requirements in the Final IRA Report."623.  
Thus, while the scope of the IRA's analysis might be  limited to certain apples, the measures set out in 
the IRA apply to any apples exported from New Z ealand to Australia.  This is underscored by 
Biosecurity Australia's Policy Memorandum 2007/ 07 of 27 March 2007, from which New Zealand's 
panel request cites the following passage:  "Im portation of apples [from New Zealand] can be 
permitted subject to the Quarantine Act 1908 , and the application of phytosanitary measures as 
specified in the Final import risk analysis report for apples from New Zealand , November 2006."624 
2.248  If the Panel were to focus only on mature apple fruit free of trash, either packed or sorted and 
graded bulk fruit from New Zealand, as Australia ar gues, it would commit a legal error.  Australia's 
                                                      
616 Australia's reply to Panel question 8 after the first substantive meeting, p. 7. 
617 Appellate Body Report on US – Carbon Steel , para. 126. 
618 Panel Report on Japan – Apples , para. 8.32. 
619 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A-1 to this report. 
620 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A-1 to this report. 
621 Australia's IRA, Part. B, p. 9. 
622 Australia's IRA, Part A, p. 1. 
623 Australia's reply to Panel question 5 after the first substantive meeting, p. 5. 
624 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A-1 to this report.  WT/DS367/R 
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 arguments narrow the product at issue with respect to how it is identified in the panel request.  Even if 
the Panel accepted Australia's arguments, it would still reach the conclusion that the IRA's effects 
extend to all apples from New Zealand imported into Australia.  Indeed, only apples within the scope 
of the IRA are allowed to be imported into Australia.  In other words, the IRA is equally applicable to 
any other type of apple from New Zealand, in the sen se that it restricts the importation of those apples 
into Australia. 
2.249  The Panel now turns to New Zealand's focus on "mature, symptomless" apples.  New Zealand 
states that its focus on "mature, symptomless" appl es is done in the context of the arguments it has 
brought forth in this case "[which] are, as a practic al matter, based on the product actually exported 
from New Zealand".625  Such focus, made for the purpose of New Zealand's arguments relates to 
issues of the merits of the case, issues which will not be  dealt with in this section.  This should not be 
confused with the definition of the product at issue. 
2.250  Again, for the purpose of defining the product at i ssue it is the Panel's terms of reference that 
define the scope of the dispute.  New Zealand's cl aims are directed to measures contained in the IRA 
which are applied to the importation of apples fro m New Zealand.  The Panel cannot broaden or 
narrow its mandate, it has to limit itself to address th e measures and products identified in the Panel's 
terms of reference.626  Accordingly, the identified product at issue is apples imported from 
New Zealand into Australia.  This constitutes the scope of this dispute.  New Zealand's arguments 
referring to "mature, symptomless apples" are relevant, not for the determining the product at issue, 
but rather for the purposes of reviewing Australia's challenged measures in light of the provisions of 
the SPS Agreement identified in the Panel request.  In  sum, the Panel's terms of reference, and not 
New Zealand's legal arguments, define the pr oduct at issue and the scope of the dispute. 
2.251  In conclusion, the Panel's terms of reference refer to "the im portation of apples".  The Panel 
may not limit itself to the analysis of only "mature ap ple fruit free of trash, either packed or sorted and 
graded bulk fruit from New Zealand", or on the other hand to only "mature, symptomless apples".  By doing so, and failing to incorporate into its analys is the products defined in the Panel's terms of 
reference, namely apples from Ne w Zealand imported into Australia, the Panel would be incorrectly 
narrowing its mandate. 
2.252  In light of these considerations, the Panel conc ludes as a factual point that the product at issue 
identified in the Panel's terms of reference is apples from New Zealand imported into Australia. 
III. PARTIES' REQUESTS FOR FINDINGS AND RECOMMENDATIONS  
3.1 New Zealand requests the Panel to find that the challenged measures are, both individually 
and as a whole, inconsistent with the obligations  of Australia under the following provisions of the 
SPS Agreement:  Articles 2.2 and 2.3 (both sentences);  Articles 5.1, 5.2, 5.5 (fi rst sentence) and 5.6;  
Article 8;  and Annex C(1)(a). 
3.2 In response, Australia argues that: 
(a) Australia's measures are not inconsistent with Article 5.1 and, accordingly, with 
Article 2.2 of the SPS Agreement, and that they are also not inconsistent with 
Article 5.2 of the SPS Agreement;  or, altern atively, that Australia's measures are not 
inconsistent with Article  2.2 of the SPS Agreement; 
(b) Australia's measures are not inconsistent with Article 5.6 of the SPS Agreement; 
                                                     
 
625 New Zealand's reply to Panel question 2 afte r the first substantive meeting, para. 5. 
626 Appellate Body Report on Japan – Alcoholic Beverages II , p. 26. WT/DS367/R 
Page 78  
 
 (c) Australia's measures are not inconsistent w ith Article 5.5 of the SPS Agreement and, 
consequently, with Article 2.3;  and, 
(d) New Zealand's claim under Article 8 and Annex C(1)(a) of the SPS Agreement is 
outside the scope of this dispute and should be dismissed by the Panel. 
IV. ARGUMENTS OF THE PARTIES
627 
A. NEW ZEALAND  
1. Executive summary of New Zealand's first written submission 
(a) Introduction 
4.1 The importation of New Zealand apples into Austra lia is subject to highly restrictive measures 
relating to fire blight, European canker and apple leafcurling midge (ALCM) set out in Australia's 
Final Import Risk Analysis Report for Apples from New Zealand (IRA).  These measures effectively 
close Australia's market to New Zealand apples. 
4.2 While New Zealand does not dispute the right of a WTO Member to take sanitary and 
phytosanitary (SPS) measures necessary for the protec tion of human, animal or plant life or health, as 
a WTO Member and party to the Agreement on the Application of Sanitary and Phytosanitary 
Measures (SPS Agreement), Australia's SPS measures must also comply with its obligations under 
that Agreement. 
4.3 The SPS Agreement requires that SPS measures a pplied to the importation of a product – in 
this instance apples imported into Australia from Ne w Zealand – be based on an appropriate risk 
assessment and be supported by sufficient scientific  evidence.  However, there is no scientific 
evidence that mature, symptomless apples are a pa thway for the transmission of fire blight or 
European canker – indeed there is evidence to  the contrary. In the case of ALCM, Australia 
conjectures a confluence of events which falls far short of being a real world likelihood. 
4.4 Accordingly, and for the reasons detailed be low and set out in full in New Zealand's 
submission, the measures at issue adopted by Australia are inconsistent with Arti cles 2.2, 2.3, 5.1, 5.2, 
5.5, 5.6, 8 and Annex C(1)(a) of the SPS Agreement. 
(b) Background 
4.5 The Australian market has eff ectively been closed to New Zealand apples since 1921.  In 
1986, and again in 1989 and 1995, New Zealand requested access to that market – and each time 
access was denied. 
4.6 In 1999, New Zealand made its fourth request for the admission to Australia of New Zealand 
apples. Almost eight years later, in November 2006, the IRA was released. It sets out measures to be 
applied to the importation of New Zealand apples to address pests and diseases that Australia reports 
itself to be free of, in particular:  fire b light – a plant disease caused by the bacterium Erwinia 
amylovora ; European canker - a plant di sease caused by the fungus Neonectria galligena ; and ALCM 
– a small, winged insect which feeds on the unfurling  leaves of apple trees.  These measures in effect 
continue to exclude New Zealand apples from the Australian market. 
                                                      
627 This section on the arguments of the Parties is  based on the executive summaries submitted by the 
Parties to the Panel.  WT/DS367/R 
 Page 79 
 
 
 4.7 During the many years of preparation of the IRA, New Zealand's request for market access 
for apples developed a political prominence in Austra lia.  The issue of New Zealand apple access was 
debated in the run-up to federal elections, there we re Senate Committee heari ngs on the matter and the 
Australian apple industry was closely involved in the import risk analysis process. 
4.8 In its panel request, New Zealand identified sev enteen specific measure s imposed in respect 
of three pests:  fire blight, European canker and ALCM.  The measures fall into two categories;  those 
of general application and those specific to each of  the three pests.  New Zealand considers these 
measures are inconsistent with Australia 's obligations under the SPS Agreement. 
4.9 The measures at issue applicable to fire blight  are the requirements that:  apples be sourced 
from areas free from fire blight disease symptoms;  orchards/blocks be inspected for fire blight 
disease symptoms; an orchard/block inspecti on methodology be devel oped and approved;  
orchards/blocks be suspended for the season on the basis that any evidence of pruning or other 
activities carried out before the inspection could constitu te an attempt to remove or hide symptoms of 
fire blight;  orchards/blocks be suspended for th e season on the basis of detection of any visual 
symptoms of fire blight;  apples be subject to disi nfection treatment in the packing house;  all grading 
and packing equipment that comes in direct contact with apples be cleaned and disinfected 
immediately before each Australian packing run, and that packing houses registered for export of 
apples process only fruit sourced from registered orchards. 
4.10 In respect of European canker the measures at issue are the requirements that:  apples be 
sourced from export orchards/blocks free of European  canker;  all trees in export orchards/blocks be 
inspected for symptoms of European canker;  a ll new planting stock be intensively examined and 
treated for European canker;  orchards/blocks be suspended fo r the season on the basis that any 
evidence of pruning or other activities carried out befo re the inspection could constitute an attempt to 
remove or hide symptoms of European canker;  and exports from orchards/blocks be suspended for 
the coming season on the basis of detection of Europ ean canker and that reinstatement would require 
eradication of the disease, confirmed by inspection. 
4.11 The measures at issue applicable to ALCM are the requirements of inspection and treatment, 
including:  the option of inspection of each lot on the basis of a 3000 unit sample selected at random 
across the whole lot, with detection of any live quarantineable arthropod resulting in appropriate 
treatment or rejection for export; or the alternative option of inspection of each lot on the basis of a 
600 unit sample selected at random across the whole lot, plus mandatory treatment of all lots. 
4.12 The general measures are:  the requirement th at Australian Quarantine and Inspection Service 
officers be involved in orchard inspections for Europ ean canker and fire blight, in direct verification 
of packing house procedures, and in fruit inspection and treatment;  the requirement that New Zealand 
ensure that all orchards registered for expor t to Australia operate under standard commercial 
practices;  and the requirement that packing houses provide details of the layout of premises. 
(c) Legal analysis 
(i) Australia's measures are inconsistent with Article 2.2 
4.13 Australia's measures are "maintained without su fficient scientific evidence".  There is no 
"rational or objective" relationship between those measures and scientific evidence, and therefore they 
are inconsistent with Article 2.2 of the SPS Agreement. 
4.14 All of Australia's fire blight measures depend on the contention that mature apple fruit 
provide a pathway for the transmission of the disease.  However, there is no evidence that fruit to be 
exported from New Zealand – that is, mature, symptoml ess apples – provide such  a pathway.  Rather, WT/DS367/R 
Page 80  
 
 the scientific evidence shows that mature, sympto mless apple fruit do not transmit the disease and 
have never done so. 
4.15 In Japan – Apples, the relevant scientific evidence was reviewed by the panel and by its 
scientific experts.  The panel found that the risk that mature, symptomless apple fruit would transmit 
fire blight was negligible.  The panel's conclusi ons were upheld by the Appellate Body.  There is 
nothing to suggest that the panel and the scientific experts in Japan - Apples  were wrong.  Indeed, 
scientific research on fire blight since Japan – Apples  only serves to reinforce the panel's conclusions. 
4.16 Fire blight bacteria are not found internally in mature apple fruit.  The bacteria are only rarely 
found externally on apples, and then only on the ca lyx, an environment that is not conducive to the 
growth, survival or transfer of E. amylovora .  Even when found on the calyx, E. amylovora  are not in 
quantities sufficient to be transmitted to a susceptible  host and initiate an infection, particularly 
following the decline in bacteria numbers that occurs during post-harvest handling, storage and 
transport of apples.  Studies have concluded that the risk of importing E. amylovora  on commercial 
apple fruit and the concomitant risk of a fire bli ght outbreak is so small as to be insignificant. 
4.17 The scientific evidence is reinfor ced by the reality of the intern ational trade in apples.  Over 
the past several decades, billions of apples have be en exported into fire blight-free countries with no 
spread of fire blight resulting. 
4.18 Since the contention that mature, symptoml ess apple fruit provide a pathway for the 
transmission of fire blight is not supported by sci entific evidence, none of the fire blight measures 
imposed by Australia have a rational or objective re lationship with the scientif ic evidence.  Indeed, 
many of the Australian measures, for exam ple chlorine dipping, parallel those in Japan – Apples  
found to be in violation of the SPS Agreement. 
4.19 Similarly, the measures imposed in respect of European canker are based on the contention 
that mature, symptomless apples provide a path way for transmitting the disease.  However, once 
again, this is not supported by scientific evidence.  Such a pathway has never been demonstrated to 
exist.  In particular, there is no scientific eviden ce of mature New Zealand apple fruit being latently 
infected with N. galligena .  Australia's contentions about la tent infection are based on studies 
conducted in countries where the climate, characteri sed by high summer rainfall, is very different 
from that of New Zealand. 
4.20 There is also no scientific support for the propositi on that mature apple fruit could be infested 
(surface-contaminated) with N. galligena  by spores at harvest, as a future source of infection or cross-
contamination of clean apple fruit. Further, even if N. galligena  were present in or on mature 
New Zealand apple fruit and survived handling, pro cessing and transport into Australia, there is no 
scientific evidence that spores would be produced from la tently infected or infest ed fruit, or that these 
spores could be spread from infected fruit to a susceptible host. 
4.21 Finally, there is no scientific evidence that Eu ropean canker could establish and spread in the 
Australian climate, given that conditions favourab le to European canker, namely rainfall and 
moderate temperatures, are not prevalent in Austra lia's apple growing regions.  There can be no better 
evidence of the lack of a pathway and the inhospita bility of the Australian climate to the disease than 
the failure of European canker to spread during the Tasmanian outbreak last century, despite the 
unrestricted movement of apple fruit within  and from Tasmania during this period. 
4.22 Since there is no scientific evidence that matu re, symptomless apple fruit provide a pathway 
for the transmission of European canker, none of the European canker measures imposed by Australia 
have a rational or objective relations hip with the scientific evidence.  WT/DS367/R 
 Page 81 
 
 
 4.23 The Australian measures in relation to ALCM ar e also maintained wit hout sufficient scientific 
evidence.  In formulating its measures for ALCM Au stralia has not taken into account the scientific 
evidence which indicates that approximately 85 per cent of ALCM cocoons on New Zealand apple fruit are not viable because they do not contain liv e pupae.  That fact, combined with the midge's 
limited lifespan and flight range, and other biologi cal factors, renders highly improbable the sequence 
of events on which Australia relies to support its measures. 
4.24 Australia's contention would require at least 4,000 apples to be dumped, uncovered at a single 
site within 30m of apple trees with new shoots.  There is no scientific evidence demonstrating that 
such a sequence of events has occurred or would occur in the real world. 
4.25 The implausibility of such a sequence of events is borne out by the history of trade in apple 
fruit.  New Zealand has exported millions of apples to ALCM-free countries with no special measures 
for ALCM and with no spread of ALCM resulting. 
4.26 In light of this, a standard AQIS inspecti on regime of 600 apples would be more than 
adequate to address the risk.  The 3000 fruit sample  inspection regime required by Australia or the 
mandatory treatment in addition to a 600 fruit inspection are disproportionate to the risk. 
4.27 Equally, the general measures imposed by Au stralia for the importation of New Zealand 
apples are maintained without sufficient scientific ev idence.  Indeed, Australia does not even attempt 
to provide a scientific justification for these measures. 
(ii) Australia's measures are inconsistent with Article 5.1 
4.28 Australia's measures are not based on a "risk as sessment" within the meaning of Article 5.1 
and Annex A and are therefore inconsistent with Article 5.1 of the SPS Agreement. 
4.29 The IRA approaches the risk asse ssment in a way that ascrib es quantitative probability values 
to steps that are often no more than possibilities – in some instances the remo test of possibilities.  
Such an approach is inconsistent with that adopted by the Appellate Body in Australia – Salmon  and 
EC – Hormones , which emphasises that a ri sk assessment must be concerned with probabilities and 
not just possibilities. 
4.30 Australia compounds this problem with several  fundamental methodological flaws, with the 
result that the levels of risk ascribed in the IRA ha ve no credibility.  Such flaws include the choice of 
an inflated maximum value for th e probability of events with a "negligible" likelihood of occurring, 
inappropriate use of the uniform distribution to  model the likelihood of various events, and 
overestimation of the projected volume of trade in New Zealand apples.  The overall effect of these 
three fundamental methodological flaws has been to seriously overestimate the likelihood of events 
whose probability of occurring is negligible. 
4.31 Additionally, like Japan in Japan – Apples , Australia has neither "evaluated the likelihood" of 
entry, establishment or spread of the relevant pests,  nor has it evaluated the likelihood of their entry, 
establishment or spread "according to th e SPS measures which might be applied". 
4.32 In respect of fire blight, the IRA asserts a high ly inflated likelihood of  entry of the bacteria 
into Australia via imported apples.  Australia's "im portation steps" for fire blight assume a continuous 
transmission pathway, ignoring the fact that at criti cal points there is no evidence of a pathway.  In 
assigning probability values to what are frequently th e remotest of possibilities, Australia has ignored 
or significantly misunderstood scientific evidence,  which throughout provides no support for the 
suggestion that a pathway exists. WT/DS367/R 
Page 82  
 
 4.33 Mature, symptomless apple fruit is not  a vector for the transmission of E. amylovora .  This is 
confirmed by the scientific evidence, as endor sed by the Panel and scientific experts in Japan – 
Apples .  Hence, fire blight would not be transmitted to  host plants in Australia through the importation 
of mature, symptomless apples.  Australia's IRA is thus not an evaluation of the "likelihood of entry"; it is speculation on the possibility of entry that is not in conformity with Article 5.1 of the 
SPS Agreement. 
4.34 The IRA equally fails to evaluate the likelihood of the establishment or spread of fire blight 
within Australia.  Australia contends that , once apples infested or infected with E. amylovora  arrive in 
Australia, the disease would be likely to be transmitt ed to host plants.  This contention assumes that 
there is a dispersal mechanism to move the bacteria  to a susceptible host.  However, there is no 
scientific evidence of any likelihood that this could occu r.  In this area, too, the IRA's analysis rests on 
remote possibilities and not on probabilities based on scientific evidence of naturally occurring 
events.  The IRA has only offered speculation about hypothetical events that have never been shown 
to occur. 
4.35 Nor does Australia's analysis of the consequences of fire blight constitute an evaluation of the 
"associated potential biological and economic conse quences" of the disease within the meaning of the 
SPS Agreement.  The IRA overestimates the severity  of the impact of fire blight on pipfruit 
production as well as other consequences of the introduction and spread of the disease, based on selectively chosen evidence and on assumptions that have no basis in scientific evidence or fact.  A 
proper assessment, relying on the actual experience of  countries where fire blight is present, would 
have resulted in the overall consequences of th e introduction and spread of the disease being 
recognized as minor. 
4.36 Equally, the IRA's analysis of the probability of importation of European canker rests on the 
flawed contention that mature, symptomless a pple fruit are a pathway for the transmission of 
European canker , a contention that is not supported by scientific evidence. 
4.37 In particular, there is no scientific evidence of mature New Zealand apple fruit being latently 
infected, or infested, with N. galligena .  Further, even if N. galligena  were present in or on mature 
New Zealand apple fruit, there is no scientific evid ence to support the likelihood that spores would be 
produced from latently infected or infested fruit,  or that these spores could be transferred from 
infected fruit to a susceptible host in conditions suit able to initiate infection once in Australia.  In 
assigning probability values to steps that are no more  than remote possibilities, the IRA ignores or 
misapplies scientific data or speculates about ev ents that would almost certainly not occur. 
4.38 The IRA also fails to evaluate the likelihood of the establishment or spread of European 
canker within Australia.  Once again, the Australia n analysis is based on assumptions about climatic 
similarity and alternative hosts in other countries where European canker is known to occur – none of 
which finds support in science.  Equally, Australia  significantly overestimates the severity of the 
consequences of European canker, based on assumpti ons that are not supported by scientific evidence. 
4.39 In respect of ALCM, Australia overestimates the likelihood of entry at several importation 
steps and then bases likelihood of establishment and spread on a scenario that almost certainly would 
not occur.  In particular, the IRA's evaluation of  the likelihood of entry of ALCM into Australia 
erroneously equates the number of cocoons with the number of viable ALCM found on apples.  
However, cocoons themselves are not a risk factor fo r ALCM.  It is only cocoons that contain viable 
ALCM pupae that pose any potential risk. 
4.40 Just as Australia has failed to evaluate the lik elihood of entry of ALCM, it has equally failed 
to evaluate the likelihood of "establishment or sp read" of the pest.  The IRA's evaluation of the 
transfer of ALCM to a susceptible host rests on uns ubstantiated assumptions about the circumstances  WT/DS367/R 
 Page 83 
 
 
 and conditions under which adults wi ll emerge and the likelihood that they will successfully mate.  
Australia's contention that ALCM would be likely to  become established and spread in Australia is 
unsupported by scientific evidence or experience.  It ignores the issue of viability of cocoons, the 
actual biology of ALCM and the reality of commer cial practice with respect to the sale, use and 
disposal of apple fruit.  Australia's purported an alysis of the "associated potential biological and 
economic consequences" of ALCM is also flawed, constituting nothing more than a listing of 
unsubstantiated assumptions. 
4.41 Finally, Australia has failed to evaluate the lik elihood of entry, establishment and spread of 
each pest "according to the SPS measures that migh t be applied".  The IRA determined, without 
analysis, that certain measures should be applied and failed to evaluate alternative measures that 
might have been applied instead, including a partic ular measure proposed by New Zealand requiring 
apples to be imported "retail ready". 
4.42 Since Australia has failed to comply with  its obligations under Article 5.1 of the 
SPS Agreement it is also in breach of the requirement s of Article 2.2 that the measures be "based on 
scientific principles" and not be maintain ed "without sufficient scientific evidence". 
(iii) Australia's measures are inconsistent with Article 5.2  
4.43 Australia has also failed to comply with its obligations under Article 5.2.  The IRA ignores 
available scientific evidence on the basis of which the panel in Japan – Apples  concluded there was 
no pathway for the transmission of fire blight through mature, symptomless apples;  it ignores 
relevant apple production processes in New Zealand;   it ignores its own border inspection processes;  
it ignores the actual prevalence of the relevant di seases or pests in New Zealand;  and it ignores 
relevant climatic conditions in  both New Zealand and Australia. 
(iv) Australia's measures are inconsistent  with Article 5.5 and Article 2.3  
4.44 Australia's measures for the importation of New Zealand apples are inconsistent with its 
obligations under Articles 5.5 and 2.3.  Australia has established its own leve l of protection (ALOP) 
against risks to plant life or hea lth in respect of two diseases affecting Japanese pears – brown rot and 
Japanese Erwinia.  In those cases, imported fruit with a degree of risk equivalent  to or higher than that 
of New Zealand apples are subject to measures subs tantially less restrictive than those imposed on 
New Zealand apples, constituting arbitrary and unjustif iable distinctions in treatment of different 
situations resulting in discrimination or a di sguised restriction on international trade. 
4.45 Several of the "warning signals" and other additi onal factors, identified by the Appellate Body 
in EC – Hormones  and the panel in Australia – Salmon  are present in the current instance.  These 
include:  the inconsistency of the measures with Arti cle 5.1;  the level of politicisation of the IRA 
process;  the undue delay involved in the process and the absence of certain comparable domestic 
requirements.  The presence of such warning si gnals and additional factors indicates that the 
distinctions in the levels of protection adopted by Australia in different situations are arbitrary and 
unjustifiable and amount to discrimination or a disguised restriction on international trade. 
(v) Australia's measures are inconsistent with Article 5.6 
4.46 Australia's measures for the importation of New Zealand apples are inconsistent with its 
obligations under Article 5.6. 
4.47 There are alternative measures available that would have met Australia's ALOP.  In the case 
of fire blight and European canker, restricting trade to mature, symptomless apples would be consistent with the ruling in Japan – Apples  and would meet Australia's ALOP.  In the case of WT/DS367/R 
Page 84  
 
 ALCM, inspection of a 600-unit sample would also have  been a less trade restrictive alternative.  
Such alternative measures would ach ieve Australia's appropriate le vel of phytosanitary protection, 
taking into account technical and economic feasibility.  They are al so reasonably available and are 
significantly less trade restrictive than those which Australia has im posed in relation to New Zealand 
apples. 
4.48 In addition, because the measures at issue are mo re restrictive than required, they also breach 
the requirement in Article 2.2 that measures be "app lied only to the extent necessary to protect human, 
animal or plant life or health". 
(vi) Australia's measures are inconsistent with Article 8 and Annex C(1)(a)  
4.49 Australia's measures for the importation of New Zealand apples are inconsistent with its 
obligations under Article 8 and Annex C(1)(a).  Th e delay by Australia of almost eight years to 
complete its approval procedures for access for New Z ealand apples is clearly "undue".  In the case of 
fire blight, there was no new scientific ev idence contrary to the conclusions in Japan – Apples  
requiring consideration, and in the case of Eur opean canker and ALCM the science was accessible 
and uncontroversial.  Instead, Australia adopted an approval process that was intertwined with a 
political process, resulting in Australia 's market remaining effectively closed to New Zealand apples.  
Measures resulting from such a delayed process ha ve not been imposed in accordance with the 
SPS Agreement. 
(d) Conclusion 
4.50 For these reasons, further developed in the body of its submission, New Zealand requests the 
Panel to find that Australia's measures are inconsis tent with its obligations under the SPS Agreement, 
and to recommend that Australia bring its meas ures into conformity with that Agreement. 
2. Executive summary of New Zealand's opening oral statement at the first substantive 
meeting 
(a) Introduction 
4.51 This dispute is about access of apples from New Zealand into the Australian market.  For over 
80 years, Australia's market has b een closed to New Zealand apples.  Finally in 2007, some eight 
years after New Zealand had made a fourth request for entry, apples from New Zealand were permitted access to Australia but subject to measures that meant that effectively the market was still 
closed.  New Zealand has challenged 17 of those me asures relating specifically to fire blight, to 
European canker, and to apple leafcurling midge as well as certain general measures applicable to all 
three pests.  As New Zealand pointed out in its first written submission, these measures do not 
conform to Australia's obliga tions under the SPS Agreement. 
4.52 The essence of the New Zealand case is quite straightforward.   Among the core requirements 
of the SPS Agreement are the obligations that sanita ry and phytosanitary meas ures not be maintained 
without sufficient scientific evidence (Article 2. 2) and that such measures be based on a risk 
assessment (Article 5.1).  In both of these fundame ntal respects Australia has failed to meet its 
obligations under the SPS Agreement. 
(b) Product at issue 
4.53 
The product at issue in this case is apples im ported from New Zealand into Australia.  In 
practice, New Zealand would export mature, sy mptomless apples in acco rdance with the class 1 
export quality standard.  Australia is incorrect to suggest that the product at issue in this dispute  WT/DS367/R 
 Page 85 
 
 
 should be determined by reference to the scope of th e IRA.  The product at issue is determined by the 
terms of reference of the Panel. 
(c) Measures at issue 
4.54 In its Panel request, New Zealand identified 17 specific measures that New Zealand considers 
are inconsistent with Australia's obligations unde r the SPS Agreement.  These measures fall into two 
categories:  those of general application to all thr ee pests;  and those specific to each of the pests. 
4.55 In its first written submission, Australia argues th at there are only 15 measures at issue.  First, 
in the light of Australia's statement in its first written submission that there is no pruning requirement 
with regard to European Canker, New Zealand w ill not pursue its claim that this is a measure.  
However, it asks the Panel to record Australia's  position and New Zealand's response in its report. 
4.56 Second, Australia argues that New Zealand mi scharacterises the measure relating to AQIS 
involvement.   New Zealand considers that any type of AQI S involvement in orchard inspections for 
European canker and fire blight, in direct verification of packing house procedures, and in fruit inspection and treatment is without scientific s upport, and accordingly there is very much a live 
dispute between the Parties.  Furthermore, a 100 pe r cent audit of survey teams and packing houses in 
the first year by the officials of an importing country does not conform to any notion of a systems 
audit as understood by New Zealand. 
4.57 Finally, Australia's distinction between pr incipal and ancillary measures (measures which 
"support, verify or operationalise" the principal risk reduction measure) is spuri ous.  It has no textual 
basis in the SPS Agreement.  Neither Annex A no r any of the substantive obligations make any 
distinction between types of measures. Australia thus uses the principal/anc illary distinction as a 
vehicle to avoid scrutiny under Articles 2.2 and 5.1 of this class of "ancillary" measures.  
New Zealand submits that such an approach should be resisted. 
(d) The applicable law 
(i) Standard of review 
4.58 In New Zealand's view the appropriate standard of  review in this case is set out in Article 11 
of the DSU.  This requires the Panel to "make an objective assessment of the matter before it, 
including an objective assessment of the facts of th e case and the applicability of and conformity with 
relevant covered agreements…".  This standard of  review has been applied in every WTO SPS case to 
date. 
4.59 Australia's claim that an alternative standa rd of review should be applied, based on 
"considerable deference" to risk assessments, is with out merit.  The Appellate Body has twice rejected 
similar arguments in previous SPS cases, EC – Hormones  and Japan – Apples.  
4.60 Australia's suggestion of "considerable" defere nce should be similarly rejected.  Any other 
approach would fundamentally alter the "finely drawn balance" of jurisdictional competencies 
reflected in the SPS Agreement. 
(ii) Order of analysis 
4.61 
Australia is wrong to suggest th at "the question of whether Au stralia has maintained measures 
"without scientific evidence" under Article 2.2 can only be answered  by considering whether 
Australia's measures are based on a va lid risk assessment under Article 5.1". WT/DS367/R 
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 4.62 Article 5.1 is a specific application of Article 2.2.  There is nothing in the text of the 
SPS Agreement that suggests that an analysis of Ar ticle 5.1 should logically precede an analysis of 
Article 2.2.  On the contrary, the Appellate Body in EC – Hormones  considered that an approach that 
started with the "Basic Rights and Obligations" in Article 2 was "logically attractive".  New Zealand 
agrees.  Australia is attempting to limit the scope of  Article 2.2 "in favour" of Article 5.1, contrary to 
Japan – Agricultural Products . 
4.63 Australia's view on the relations hip between Article 2.2 and 5.1 subsumes  the third 
requirement of Article 2.2 within Article 5.1,  and then through its standard of review drains it of any 
substantive content .  The consequence would be that th e panel would have no mandate to assess 
whether there is a "rational or objective" rela tionship between the science and the SPS measures. 
(iii) Burden of proof 
4.64 The issue of burden of proof should not be cont entious in these proceedings.  However, in a 
number of places in its first written submission, Australia misapplies the burden of proof.  For 
example, in the context of Article 2.2 Australia us es the notion of "burden of proof" to transform the 
obligation not to maintain measures without scientif ic evidence in Article 2.2 into its own watered-
down version of Article 5.1.  This should be rejected. 
(e) Article 2.2 
4.65 In its first written submission New Zealand argued that Australia's measures violated 
Article 2.2, in particular the third requirement of Ar ticle 2.2.  The core of New Zealand's argument is 
that there is no scientific evidence to support th e view that mature, symptomless apples provide a 
pathway for fire blight and European canker and the likelihood of the existence of a pathway for 
ALCM is negligible. 
4.66 In respect of New Zealand's arguments with respect to Article 2.2, Australia relies principally 
on its contention that consistency with Article 5.1 constitutes consis tency with Article 2.2.  Thus, 
Australia does not make a serious attempt to rebut New Zealand's arguments relating to Article 2.2. 
4.67 Though Australia does not rebut New Zealand' s Article 2.2 claim directly, there is a 
continuing refrain that Australia is entitled to rely on "divergent scientific opinion".  But, there are no 
divergent scientific opinions suggesting the existence of  pathways for each of the pests in question, on 
which Australia claims to have relied.  They simp ly cannot be found.  This is hardly surprising 
because there is no diverging scientific opinion.  No such pathway exists for the two diseases and the 
likelihood of a pathway for ALCM is negligible. 
4.68 Even in respect of the allegedly diverging sci entific opinion relating to specific steps in the 
alleged pathway, on closer analysis there is no true  divergent opinion.  And, even if there had been 
divergent scientific opinion, this would not mean th at Australia could automatically rely on it.  The 
divergent science must be of a nature that there is a rational and objective relationship between the 
scientific opinion and the measures in question.  N one of the alleged divergent opinion meets that 
requirement. 
(i) Fire blight 
4.69 Australia fails to rebut New Zealand's claim th at there is no scientific support for the view 
that mature symptomless apples provide a pathwa y.  Instead, it seems to argue that "there is no direct 
evidence  that apples do not spread fire blight" and that  it is up to New Zealand to produce such direct 
evidence, thereby rewriting the burden of proof an d requiring New Zealand to prove a negative.  
Article 2.2 does not permit a Member to maintain measures in relation to a hypothetical pathway as  WT/DS367/R 
 Page 87 
 
 
 long as there is no scientific evidence disproving the hypothesis.  Rather a Member may not maintain 
measures without sufficient scientific evidence.  Au stralia seeks to turn Article 2.2 on its head. 
4.70 Australia's claim that the Roberts and Sawyer 20 08 study is not relevant to this dispute and 
that its findings are "unreliable and inappropriate " is without substance.  The US Third Party 
submission has pointed this out in detail and New Zealand fully agrees with its analysis. 
4.71 The overall conclusion of Roberts and Sa wyer was that the risk of importing E.  amylovora  on 
commercial apple fruit and of establishing new outbr eaks of fire blight is so small as to be 
insignificant – the opposite conclusion from that reached by the IRA. 
4.72 In short, New Zealand's arguments in respect of fi re blight have not been  rebutted.  Australia's 
measures in respect of fire blight are not supporte d by sufficient scientific evidence and Australia is 
thus in violation of its obl igations under Article 2.2. 
(ii) European canker 
4.73 Australia's attempted rebuttal of the New Zealand case on European canker focuses on the 
incidence of European canker fruit rot in New Z ealand.  However, while fruit rots caused by 
N. galligena  are not unknown, they are very rare in  New Zealand, where summer conditions are 
generally not conducive to fruit infection. 
4.74 Australia continues to rely on the Braithwaite paper as evidence of latent fruit infection in 
New Zealand.  However, the reference in Braithwa ite is not to scientific research.  Further, the 
assumption in Braithwaite as to the existence of a pathway was just speculation.  Nor was the 
Braithwaite paper "endorsed" by the New Zealand Chief Plants Officer, as Australia on several 
occasions alleges. 
4.75 As New Zealand has pointed out in its first written submission, the IRA's assumptions about 
the climatic similarity of Australian apple-produc ing regions to other regions of the world where 
European canker is present, are not based on scientific evidence. 
4.76 Australia seeks now to present its own analysis of climate data, an analysis that was 
completely missing in the IRA.  However, the Australian paper does not provide the methodological 
information necessary to allow an appraisal of the c limate matching procedure used.  The flaws in the 
Australian analysis are demonstrated in its risk maps of New Zealand, which indicate high European canker risk in areas of New Zealand where European canker is virtually non-existent.  This is a clear 
expression of the unreliability of the Australian analysis. 
4.77 The failure of European canker to establish and spread during the Tasmanian outbreak was 
also a probable consequence of climatic conditions.  Australia now tries to argue that the Tasmanian 
strain of N. galligena  was a "unique" strain.  But there is no scientific evidence to support Australia's 
novel speculation that the N. galligena  found in Tasmania was a heterothallic strain or that a 
New Zealand "strain" of N. galligena would produce ascospores if introduced into Australia.  The 
failure of the disease to spread within Tasmania, let alone to the mainland, despite the uncontrolled 
movement of thousands of tonnes of apple fruit (and millions of apples) is convincing evidence of the 
lack of a pathway for the spread of European canker in Australia. 
(iii)
 ALCM 
4.78 The key flaw in the assumption of the IRA that  New Zealand apples could be a pathway for 
the transmission of ALCM to Australia is that th ere is no scientific support for suggesting that the WT/DS367/R 
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 likelihood of establishment of ALCM in Australia as a result of trade in apples is anything other than 
negligible. 
4.79 A major problem with Australia's analysis of AL CM is that the great majority of cocoons on 
New Zealand apples are not viable, either because th e midge inside has already developed into an 
adult and left the cocoon, or because it has died insi de the cocoon.  Australia's arguments in its first 
written submission disputing New Zealand's es timates on the proportion of ALCM cocoons 
containing viable pupae are based on Australia's faulty reading of the research into the viability rate of 
cocoons set out in Rogers et al. 2006. 
4.80 If the low level of viable cocoons on New Z ealand apples, the ALCM's biology and normal 
trade practices are all taken into account, the unavo idable conclusion is that the likelihood of ALCM 
establishment in Australia from the importation of New Zealand apples is negligible.  The scenario on 
which Australia relies in its first written submission to  rebut this is simply implausible.  In sum, 
New Zealand's claim that Australia is in violation of its obligations under Artic le 2.2 stand unrebutted. 
(f) Article 5.1 
(i) Australia has not evaluated the likelihood of entry, establishment or spread 
4.81 In this case, Australia has, for only the sec ond time, applied a semi-quantitative methodology 
to its risk assessment for plant products, apparently in response to a proposal by a Senate Inquiry into 
the IRA process for apples.  There are however, inhe rent risks and limitations in a semi-quantitative 
methodology.  The IRA provides a "misleading impression of objectivity and precision".  The IRA approached what were often the remotest of possib ilities, and ascribed them inflated numerical values. 
Fundamental flaws in the IRA
 
4.82 First, Australia has adopted an inflated maxi mum value for the probability of events with a 
"negligible" likelihood of occurring.  Notably, this figure is applied on a per apple basis.  Negligible 
is, by Australia's own qualitative definition, an even t that would almost certainly not occur, yet in 
expressing this in quantitative terms, Australia c hooses a maximum value of 1 in a million (apples).  
This bears no relation to real world events. 
4.83 This flaw is compounded by the inappropriate use of the uniform distribution to model the 
likelihood of various events.  The effect of Aust ralia's choice of a maximum value of 1 in a million 
(apples) combined with Australia's choice of uniform  distribution to model events with a negligible 
likelihood of occurring, is that outcomes are skewed towards higher values and "negligible 
likelihoods" occur on average once in two million apples. 
4.84 The third fundamental flaw in Australia's risk assessment is that its estimate of the likely 
volume of trade inflates the assessed level of risk by  a factor of at least three.  This flaw has a 
significant impact on Australia's assessment of risk  because the higher the estimated volume of trade, 
the higher the overall assessed risk. 
4.85 The overall effect of these three fundamental methodological flaws has been to overestimate 
seriously the likelihood of events whose probability of  occurring is negligible, with the result that the 
levels of risk ascribed in the IRA have no credibility.  WT/DS367/R 
 Page 89 
 
 
 New Zealand does not conduct its own risk assess ment nor has Australia identified "very 
significant deficiencies"  
4.86 According to Australia, each time New Zealand points to the absence of  scientific evidence, 
New Zealand is conducting its own ri sk assessment.  In fact New Zealand is doing no more than 
discharging its burden of proof in accordance with the correct standard of review. 
4.87 With regard the phrase "appropriate to the circumstances", the panel in Australia – Salmon 
noted that it cannot "annul or supersede" the subs tantive obligation in Article 5.1.  New Zealand 
agrees. 
4.88 With regard the relevance of Japan – Apples, the central scientific issue that was resolved was 
whether apples serve as a vector for transmission of fi re blight.  It is beyond any doubt that the reports 
in that case are highly relevant in the present case. 
There are important errors in the IRA's analys is of the entry, establishment and spread in 
respect of each pest  
Fire blight 
4.89 In its first written submission, New Zealand established that the IRA's analysis of the 
importation steps for fire blight ignored or misappl ied relevant scientific data and assigned inflated 
probability values to events that would certainly not  occur.  Australia's counterargument attempt to 
rebut this relies on a critique of the Roberts and Sa wyer 2008 study, which is completely misplaced, 
given the authors' conclusion that the likelihood of  a pathway for the transmission of fire blight 
through apples is "so small as to be insignificant". 
4.90 Australia relies on the theory that only a small number of bacteria present on an imported 
apple would be sufficient to initiate a fire blight infe ction.  But there is no scientific evidence that in a 
real orchard environment low numbers of bacteria can initiate infections. 
4.91 Australia also relies heavily on an assessme nt of the consequences of establishment and 
spread of the disease.  But the consequences of a fire blight outbreak, no matter how serious, do not 
increase the chances of the pathway being complete d.  There cannot be real consequences of an 
"event" that is purely hypothetical.  Thus, the IRA's risk assessment in respect of fire blight does not 
conform with Australia's obligations und er Article 5.1 of the SPS Agreement. 
European canker 
4.92 In its first written submission, New Zealand pointed out that the IRA's analysis of the 
importation steps for European canker had assigned pr obability values to steps which often were no 
more than remote possibilities, resulting in the conclusion of a pathway for the transmission of 
European canker for which there is no support in sci entific evidence or which has never been shown 
to exist in fact.  As the IRA itself says, "there is  no evidence in the literature that indicates that long-
distance spread of the disease is due to the movement of fruit". 
4.93 Further, New Zealand established that the clima tic conditions in Australia were not suitable 
for the establishment and spread of European canker.  Australia's attempted rebuttal of this consists of 
its own, new analysis of the implications of c limate for European canker.  However, Australia's 
climate analysis is seriously flawed and unreliable.   In any event, Australia cannot remedy in these 
proceedings the failure of the IRA to consider climate in its risk assessment. WT/DS367/R 
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 4.94 Equally, the IRA's arguments about alternative hosts in its analysis of the likelihood of 
establishment and spread are not based on scientific evidence.  However, d espite the presence of the 
pathogen in New Zealand for more than 80 years and the unrestricted movement of apple fruit around the country, there is no evidence of N. galligena  causing disease on these hosts.  Australia's attempts 
to play down the failure of European canker to spread during the Tasmanian outbreak, do not stand up 
to analysis. 
ALCM 
4.95 In its first written submission, New Zealand point ed out that there was no scientific evidence 
to support the IRA's conclusions about the likeli hood of entry, establishment and spread of ALCM. 
4.96 As New Zealand pointed out, the IRA only assessed the likelihood that apples are infested 
with cocoons, not whether the cocoons were viable.  However, it is only viable cocoons that are a risk 
factor for ALCM. 
4.97 The fact that the IRA ignored viability data is  obvious from the text of the IRA.  Australia 
tries to justify its failure to take into account viability by trying to discredit Rogers et al. 2006.  
However, Australia's analysis of Rogers is simply wrong. 
4.98 Australia also failed, in its evaluation of the likelihood that ALCM survives and remains with 
fruit after on-arrival minimum border procedures, to take into account the effect of AQIS inspection at the border. 
4.99 Australia's claim in its first written submission that adult emergence could occur at any point 
in Australia, including transportation, and re-pack ing is simply incorrect.  The scenario on which 
Australia relies for the establishment of ACLM in Australia has never occurred in the real world and 
is simply implausible. 
4.100  There was, thus, no basis in science for the assumption of the IRA about the establishment of 
ALCM in Australia and the Australian first written submission fails to rebut New Zealand's arguments on this point. 
4.101  In respect of all three pests, Australia tries to  shift the emphasis of a risk assessment from the 
likelihood of entry, establishment and spread to th e consequences of establishment.  Australia argues 
vehemently that risk assessment involves more than science;  it involves economic and technical 
factors.  But in making this argument, Australia, once again, misses the central point.  There is no 
basis under the SPS Agreement for the application of  SPS measures to deal with the consequences of 
an event if, on the basis of the relevant scientif ic evidence, the event itself has no likelihood of 
occurring.  Australia's arguments on consequences are thus simply misguided. 
(ii) Australia has not evaluated likelihood "acco rding to the SPS measures which might be 
applied" 
4.102  Finally, Article 5.1 requires that there be  an evaluation of the likelihood of entry, 
establishment and spread of the three pests "according to SPS measures that might be applied". 
4.103  In respect of seven of the measures at issue th ere is no evaluation at all in the IRA of their 
effect on the risk factors identified in the IRA;  th at is, no evaluation of the impact they would have, 
either on their own or as part of a systems approach, on the assessed level of risk.  Australia acknowledges this failure but claims that the requi rement to evaluate measures is limited to only 
"principal" measures, and that the seven it failed to evaluate are "ancillary" measures.  However, there  WT/DS367/R 
 Page 91 
 
 
 is no basis for Australia's distinction between "p rincipal" and "ancillary" measures.  Australia's 
distinction is spurious. 
4.104  The IRA also failed to evaluate a measure requi ring that apples be imported retail ready even 
though specifically requested to do so by New Zealand.  At a minimum, importing countries should consider reasonable alternatives proposed by expo rting countries.  Australia did not do this. 
4.105  The cumulative result of all the matters raised  by New Zealand in respect of the risk 
assessment conducted by the IRA is that Australia has failed to comply with its obligations under 
Article 5.1 of the SPS Agreement. 
(g) Article 5.2, 5.5 and 5.6 
4.106  As New Zealand pointed out in its first written submission, Australia has breached 
Article 5.2.  The obligation to "take into account" is  an obligation of substance that requires giving 
genuine consideration to available scientific eviden ce and the other factors set out in Article 5.2.  
When, as in this case, the measures adopted fly in th e face of available scientif ic evidence, then the 
Panel needs some evidence to show that the availa ble scientific evidence and the other relevant factors 
were taken into account.  But Australia provides no  evidence to establish that  it has in fact acted 
consistently with its oblig ations under Article 5.2. 
4.107  Australia's measures for the importation of New Z ealand apples are also inconsistent with its 
obligations under Article 5.5.  Australia has adopted ar bitrary or unjustifiable distinctions in the levels 
of protection it considers to be a ppropriate in different situations, and those distinctions result in 
discrimination or a disguised restriction on internati onal trade.  Australia's attempt to contradict the 
New Zealand arguments on the basis of alleged measures that do not exist or volumes of trade are not 
convincing, and its objections to the warning signals  and additional factors identified by New Zealand 
are misguided. 
4.108  Article 5.6 requires that a Member must not establish or maintain measures that are more 
trade restrictive than required to achieve its ALOP.  However, that is exactly what Australia has done. 
In respect of both fire blight and European canke r, a less trade restrictive alternative would be a 
measure requiring that New Zealand apples imported in to Australia be mature, symptomless fruit.  In 
respect of ALCM, there is also a less trade rest rictive alternative available – a 600-unit sample 
inspection. 
(h) Article 8 and Annex C 
4.109  Australia has acted in breach of its obligati ons under Annex C(1)(a), and consequently under 
Article 8, of the SPS Agreement.  The comple tion of the IRA process was delayed well beyond any 
reasonable period of time for considering New Zeal and's request for apples access.  As New Zealand 
noted in its first written submission, "[m]easures re sulting from such a delayed process have not been 
imposed in accordance with the SPS Agreement." 
4.110  New Zealand rejects Australia's claim and sees no need for a preliminary ruling on this 
matter.  Australia's arguments are based on the false assumption that the measure at issue under 
New Zealand's Annex C(1)(a) claim is the "IRA process".  New Zealand has never claimed that the 
IRA process is a measure at issue in this dis pute.  The measures at issue under New Zealand's 
Annex C(1)(a) and Article 8 claim are the 17 meas ures identified in New Zealand's panel request.  
Australia appears to believe that the "measure at issue" under Annex C(1) must be the "procedures to 
check and ensure the fulfillment of SPS measures" referred to in the chapeau of Annex C(1).  Once 
again, as was clarified in EC – Approval and Marketing of Biotech Products,  Australia is mistaken. WT/DS367/R 
Page 92  
 
 4.111  In New Zealand's view, the procedure to check and ensure the fulfilment of SPS measures in 
the present case is the IRA process relating to apples fr om New Zealand.  So while the IRA process is 
certainly relevant to New Zealand's claim, it is not the measure at issue.  In New Zealand's view, measures resulting from such a delayed process ha ve not been imposed in accordance with the 
SPS Agreement. 
4.112  Where substantive SPS measures have been a dopted following an approval process, the 
approval process itself will have ceased to exist.  In US – Certain EC Products  the Appellate Body 
said it would be an error for a panel to make  recommendations under DSU Article 19.1 where a 
measure has ceased to exist.  An interpretation of Annex C(1)(a) that requires a complaining Party to 
challenge measures that have ceased to exist do es not accord with the DSU's aim of securing a 
positive solution to the dispute.  For these reasons, Australia's procedural objection to New Zealand's 
claims under Annex C(1)(a) and Article 8 should be rejected. 
4.113  Finally, New Zealand reaffirms all matters dealt with in its first written submission that have 
not been discussed in this oral statement and requ ests the Panel to make the rulings set out in its 
request for relief in its first written submission. 
3. New Zealand's closing oral statement at the first substantive meeting 
4.114  In the light of the first written submissions a nd oral statements, New Zealand thought that it 
would be helpful for the Panel for New Zealand brie fly to identify in this concluding statement the 
issues in dispute between the Parties. 
4.115  First, this is not a case about the right of Australia to set its ALOP.  In its opening oral 
statement at the first substantive meeting Australia ma de much of the fact that it is entitled to set its 
own ALOP.  New Zealand has not and does not dis pute this.  New Zealand makes no challenge to 
Australia's ALOP in this case or its right to set its ALOP. 
4.116  Second, this is not a case about the burden of proo f.  Again, Australia frequently claims that 
New Zealand has not met its burden of proof, ofte n more as a rhetorical device than as a real 
argument.  But, the issue between the Parties is  not about whether sufficient evidence has been 
adduced to establish a prima facie case or whether New Zealand must prove a negative – that 
pathways for the transmission of fire blight, European canker and ALCM do not exist. 
4.117  Third, this is not really a case about the appli cable law.  The basic obligations relating to SPS 
measures have been clarified through dispute se ttlement in several cases so there should be little 
dispute about them.  Australia has tried to introdu ce a "considerable deferenc e" standard of review, 
apparently as a kind of lex specialis  for SPS cases, or perhaps as New Z ealand heard in the first day of 
the meeting in response to questions for Article 5. 1 alone.  But attempts like this in other SPS cases 
have been rejected in the past and they should not be given any credence in this case. 
4.118  Equally Australia's attempt to give Article 5.1 primacy so that consistency with Article 5.1 
constitutes consistency with Article 2.2 provides a gloss on the law which, when combined with a 
deferential standard of review, is really an attemp t to shield its measures from serious review in the 
light of the standards of the SPS agreement.  It is  a claim for exemption from the agreement.  Under 
the guise of maintaining a balance in the rights a nd obligations of the SPS Agreement, Australia is 
seeking to re-order those rights and obligations. 
4.119  Fourth, the fundamental question in this case and the fundamental issue that divides the 
Parties is whether the measures imposed by Aust ralia are maintained w ith sufficient scientific 
evidence.  This can be expressed in terms of Article  2.2 as whether there is a "rational or objective  WT/DS367/R 
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 relationship" between the measures and scientific evid ence, and in terms of Article 5.1 whether there 
has been a proper assessment of the "likelihood of entr y, establishment and spread" of the three pests. 
4.120  This, in fact, is the heart of this case. 
4.121  The claim by Australia that the importation of mature symptomless apples provides a pathway 
for the transmission of the fire blight and Europ ean canker diseases and the ALCM pest, is based on 
conjecture and supposition, not on scientific evidence.  At critical points along these alleged 
pathways, as New Zealand has pointed out, scientif ic evidence in support of the Australian position 
simply does not exist.  The resolution of this differe nce between the Parties is ultimately the issue that 
the Panel has to decide. 
4.122  Measures that can be shown to have a rati onal or objective relationship with scientific 
evidence meet the requirements of Article 2.2.  A risk assessment that ev aluates the likelihood of 
entry, establishment and spread of a disease on the b asis of scientific evidence about that risk, not on 
the basis of supposition or speculation about risk, co mplies with Article 5.1.  But an assessment of 
risk cannot take negligible risk and multiply it up into higher risk by the use of numerical probability 
values that have no relationship to real world experi ence.  And, while it is true that minority scientific 
opinion can be taken into account, such minority scien ce must exist; it cannot just be claimed to exist. 
4.123  In short, the task for the Panel in this case is  ultimately to determine whether the Australian 
measures are grounded in sufficient scientific evidence, that is, whether there is a rational or objective 
relationship between the measures and scientific evidence, and whether that risk was properly 
evaluated in the IRA on the basis of scientific evid ence.  New Zealand is confident that, when the 
Panel does so, it will find Australia lacking on both counts. 
4.124  Australia's failure to find a basis in science fo r its measures have certai n further consequences 
in terms of its obligations under Articles 5.2, 5.5, 2.3 and 5.6.  In those instances, too, Australia is in 
breach of its obligations under the SPS Agreement.  In addition, be hind all of this are Australia's 
intermingled political process and its lengthy, undue delay which results in a breach of Annex C and 
Article 8, and also provides an important background and context for consideri ng Australia's measures 
in this case. 
4.125  This concludes New Zealand's closing statemen t.  New Zealand thanks the Panel for its 
attention in this first oral hearing and looks forwar d to responding in due course to the Panel's written 
questions. 
4. Executive summary of New Zealand's second written submission 
(a) Introduction 
4.126  In its first written submission, New Zealand established that Australia's measures for the 
importation of apples from New Zealand are not in c onformity with Australia's obligations under the 
SPS Agreement.  Australia's purported rebuttal seeks to shelter the Final Import Risk Analysis for 
Apples from New Zealand (IRA) from effective review , and divert the Panel from the fundamental 
issue in this case, namely, the lack  of sufficient scientific evidence to  support Australia's measures.  
The responses of the experts to the Panel's questio ns have confirmed the flaws in the IRA and the 
insufficiency of the scientific evidence relied on by Australia. WT/DS367/R 
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 (b) Detailed rebuttal of Australia's arguments 
(i) Measures at issue 
4.127  Australia is incorrect in arguing that the definition of SPS measures contained in the 
SPS Agreement only includes measures that "actively"  reduce SPS risks ("principal measures"), and 
not measures that reduce risk by supporting or implementing "principal measures" ("ancillary 
measures").  It is clear that the definition of SPS measures in the SPS Agreement includes any 
measures applied to protect against SPS risks.  The reasoning in US – Export Restraints  does not 
change this definition, and is entirely consistent with treati ng both "principal" and "ancillary" 
measures as SPS measures in the present case. 
4.128  With the exception of measure 12, New Zeala nd maintains its position that the measures 
identified in New Zealand's panel request remain  at issue, and are correctly characterised. 
(ii) Product at issue 
4.129  Whatever disagreement remains as to the precise  "product at issue" in this case, the Parties 
appear to agree that the focus of this dispute s hould be on the product that is actually traded.  
New Zealand articulates this as "mature, symptomless apples".  There is no practical difference 
between this and the product assessed in the IRA. 
(iii) Standard of review and burden of proof 
4.130  The appropriate standard of review in this case is set out in Article 11 of the DSU, which 
requires that the Panel make an "objective assessment" of the matter.  The Appellate Body has stated 
that this "articulates with great succinctness but wi th sufficient clarity the appropriate standard of 
review", and this standard has been applied in every SPS case to date.  Australia proposes a standard 
of "considerable deference"  which has been rejected twice before  by the Appellate B ody.  None of the 
cases cited by Australia support a "considerable  deference" standard, and the "balance of 
jurisdictional competencies" would be undermined, no t promoted, by Australia's proposed standard of 
review.  
4.131  New Zealand has not presented an alternative vi ew of the science as Australia suggests.  
Rather, New Zealand has established that Australia 's measures, and the conclusions in its risk 
assessment, do not find sufficient support in the sci ence, which is simply discharging New Zealand's 
burden of proof. 
4.132  The right to rely on divergent scientific opini on does not help Australia's defence.  The 
studies or information relied on by Australia either do not meet the definition of "divergent scientific 
evidence", or do not sufficiently support Australia's conclusions.  In addition, there is no evidence, 
divergent or otherwise, regarding the completion of the various pathways as a whole.  Moreover, 
Australia's implication that the IRA is itself a sour ce of divergent scientific opinion is simply another 
variation of "considerable deference", designed to  prevent meaningful WTO review of the IRA. 
(iv) Relationship between Articles 2.2 and 5.1, and order of analysis 
4.133  Articles 2.2 and 5.1 establish separate legal obligations.  Australia's view that compliance 
with Article 2.2 "can only be answered" by consid ering compliance with Article 5.1 is incorrect and 
ignores the jurisprudence of panels and the Appellate  Body.  Australia seeks to conflate two distinct 
provisions into a single obligation with a single t est.  Combined with Australia's "considerable 
deference" standard of review, the result is that  panels would be denied a mandate to objectively 
assess the sufficiency of the science.  New Zeal and disagrees that Article 2.2 was drafted too  WT/DS367/R 
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 narrowly, or that the complexity of risk analysis, the weighing of factors, the use of judgement by risk 
assessors, or the application of particular methodol ogies, are reasons to read down Article 2.2 in 
favour of Article 5.1. 
4.134  In New Zealand's view, it would be appropriate in the circumstances of this case for the Panel 
to start its examination with Article 2.2.  This  approach is consistent with that taken in Japan – Apples 
and the opinions of the Appellate Body in EC – Hormones  and in Australia – Salmon . 
(v) Australia's measures are inconsistent with Article 2.2  
4.135  Australia's measures for fire blight  assume that there is a risk th at mature, symptomless apples 
are involved in the spread of the disease.  Yet Aust ralia has been unable to point to any scientific 
evidence to support the existence of a pathway that  would or could allow the introduction of fire 
blight in Australia via mature, symptomless appl es imported from New Ze aland.  The experts' 
responses to the Panel's questions also support New Z ealand's position that there is no such scientific 
evidence.  There is therefore no rational or objective relationship between any of Australia's measures for fire blight and the scientific evidence, in  breach of Article 2.2 of the SPS Agreement. 
4.136  There is also a lack of scientif ic evidence to support each of the individual steps into which 
Australia breaks up its hypothetical fire blight pa thway.  For example, New Zealand and the experts 
have noted the absence of scientific suppor t for Australia's hypothesis that a single E. amylovora  
bacterium, or a very small number of such bacteria on a mature, symptomless apple, would be sufficient to introduce fire blight under natural c onditions.  Accordingly, New Zealand maintains its 
submission that the population levels of E. amylovora  occasionally found on infested apples at harvest 
are, under natural conditions, insufficient to be tr ansferred to a susceptible host and result in the 
spread of disease.  While it is possible that in rare circumstances E. amylovora may survive on 
harvested apple fruit, any such bacteria will only su rvive in small and diminishing numbers, unable to 
multiply. 
4.137  Having been unable to produce any scientific ev idence to support its fire blight measures, 
Australia then asserts that New Zealand is requi red to produce the evidence to prove that mature, 
symptomless apples could not  introduce fire blight.  But this is an  attempt to reverse the obligations in 
the SPS Agreement.  Rather, under Article 2.2, Australia may not maintain a measure without 
sufficient scientific evidence.  Aust ralia has failed to rebut New Zealand's case that Australia's fire 
blight measures are maintained wit hout sufficient scientific evidence. 
4.138  Australia's European canker
 measures are based on the contention that mature, symptomless 
apples from New Zealand provide a pathway for the establishment of European canker in Australia.  
The experts' responses confirm that such a path way has never been demonstrated to exist. 
4.139  In New Zealand, pre-harvest fruit rots caused by  N. galligena  are extremely rare and latent 
fruit rots (the only kind relevant to the allege d pathway) are virtually non-existent, which, as 
confirmed by the experts, reflects the generally unfavourable summer climatic conditions for fruit 
infection in New Zealand.  New Zealand has demons trated, and the experts have confirmed, that the 
only "evidence" put forward by Australia of latent infections in New Zealand, the Braithwaite report, 
does not constitute sufficient scientific ev idence to support Australia's assumptions. 
4.140  Moreover, climatic conditions in Australia ar e not conducive to the establishment and spread 
of European canker, an assessment  supported by the experts.  Australia's attempts to discredit 
New Zealand's climate arguments are misconceived.  Australia has resorted to defending the IRA by 
producing an alternative climate analysis, but this lacks transparency, is methodologically flawed, and 
shows incorrect results when compared agains t the known incidence of European canker. WT/DS367/R 
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 4.141  The failure of the disease to spread from the four affected orchards during the outbreak of 
European canker in Tasmania supports New Zealand's arguments as to climatic unsuitability.  In an 
attempt to rebut this, Australia offers new explanat ions, not previously considered by the IRA, as to 
the existence of a heterothallic strain of N. galligena  and the absence of a suitable mating partner.  
However, Australia's theory relies on an isolated finding in Germany which has no basis in the facts 
surrounding the Tasmanian outbreak.  In addition, Australia has failed to rebut evidence of the 
absence of a pathway, in light of the failure of th e disease to spread beyond the four affected Spreyton 
orchards despite the unrestricted movement of appl e fruit for the duration of the Tasmanian outbreak. 
4.142  Australia has failed to provide any scientific support for its contention of a pathway for the 
transmission of European canker via New Zealand a pple fruit.  Accordingly, none of the measures 
imposed by Australia in respect of European ca nker are based on sufficient scientific evidence, and 
are thus in breach of Article 2.2. 
4.143  Australia's measures for apple leafcurling midge (ALCM) are also maintained without 
sufficient scientific evidence.  Th ey are premised on the incorrect assumption that all ALCM cocoons 
are risk factors.  But the scientific evidence is clear that only viable cocoons would present any risk, 
and only a very small proportion of cocoons on  New Zealand apples contain viable ALCM. 
4.144  Australia argues that it did take cocoon viability into account but, as confirmed by the experts, 
it is obvious from the text of the IRA that it did not.  Australia's attempt to critique the methodology 
of the scientific studies on viability is flawed, and do es not change the fact that Australia ignored the 
relevant scientific evidence. 
4.145  Australia's measures are also based on the incorrect assumption that ALCM females have a 
flying range of up to 200m.  As confirmed by the e xperts, this conclusion is not sufficiently supported 
by the scientific evidence.  The experts have also confirmed New Zealand's position that ALCM 
emergence will occur over an extended period of time, which was not factored into the IRA's 
conclusions.  Finally, Australia's measures are ba sed on incorrect assumptions about normal retail 
supply chain practices which would effectively exclude any opportunity for ALCM establishment. 
4.146  There is, therefore, no rational basis for Austra lia's conclusion that the sequence of events 
required for ALCM establishment in Australia – ma ny thousands of apples left outside of cold 
storage, uncovered, in the same place, at the sa me time, within 30-50m of newly unfurling apple 
leaves – would occur.  Australia's comparison with  the establishment of wheat bug in the Netherlands 
(which has not been linked to trade in apples) is irrelevant to this dispute. 
4.147  Because none of the pest-specific measures are supported by sufficient scientific evidence, 
neither are the general measures
.  Australia has failed to identif y, with reference to scientific 
evidence, the particular risks which the general meas ures are supposed to address, or their efficacy in 
dealing with that risk.  Australia's flawed princi pal/ancillary distinction cannot remedy this failure. 
(vi) Australia's measures are inconsistent with Article 5.1 
4.148  New Zealand has demonstrated that the IRA is not objectively justifiable;  it does not contain 
reasoning that is objective and cohe rent, or conclusions that find sufficient support in the scientific 
evidence relied upon.  Australia's attempts to read down the obligation in Article 5.1 – by proposing a 
new "objective and credible" standard, misrepresen ting the phrase "appropriate to the circumstances", 
falling back on "expert judgement" and "scientific uncertainty", and claiming that New Zealand has 
conducted its own risk assessment – are w ithout basis, and should be rejected. 
4.149  Australia's responses to the three fundamental flaws with the IRA's methodology identified by 
New Zealand also lack merit.  Australia effectiv ely admits that there is no correlation between the  WT/DS367/R 
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 maximum value of one in a million apples, and th e qualitative description of a "negligible" likelihood 
as an event that would almost certainly not occur.   Australia's arguments regarding the second flaw 
merely underline the fact that using a uniform di stribution results in an over-representation of values 
that significantly overestimate the risk.  When applie d to something traded in millions of units (the 
"per apple" methodology), the result is that "n egligible" events are ass essed as occurring numerous 
times each export season.  With regard to the third flaw, Australia has failed to rebut New Zealand's 
arguments that the volume of trade will be signifi cantly lower than the IRA's most likely value and 
that this is another factor causing the assessed level of risk in the IRA to be inflated. 
4.150  Australia did not evaluate the likelihood of importation, establishment and spread of fire 
blight , or of the associated potential biological and economic consequences, in relation to imports of 
mature, symptomless apples from New Zealand.  No  evidence of the existence of a pathway is 
contained in the IRA, or in Australia's first writte n submission, and thus Australia has failed to assess 
risk in accordance with Article 5.1.  In addition,  none of the experts have identified any scientific 
evidence supporting Australia's contention that a pathwa y exists for the introduction of fire blight via 
mature, symptomless apples. 
4.151  Contrary to Australia's assertion in its fi rst written submission, New Zealand draws 
appropriately on the following four matters in suppor t of its case that the IRA is inconsistent with 
Article 5.1: 
(a) Japan – Apples , in which the panel found that, w ith respect to mature, symptomless 
apples, the risk that the transmission pathwa y could be completed is negligible;  and 
that pathways must have a basis in science be fore they can legitimately form part of a 
risk assessment.  Without making any sugges tion that the Panel in the present case is 
"bound" to follow the findings in Japan – Apples , or that Australia did not need to 
carry out its own risk assessment, New Zeal and's position remains that the findings in 
Japan – Apples are directly relevant to the present dispute. 
(b) The spread of fire blight to other countries via trade in apple fruit has never been 
reported. 
(c) Under natural orchard conditions, the number of E. amylovora that may, very rarely, 
be present on fruit will be low, dormant and d eclining, and as such will be insufficient 
to be transferred to susceptible hosts and initiate new infections. 
(d) Roberts and Sawyer 2008 and Roberts et al.  1998, which concluded that the risk of 
introduction of fire blight via imported apple fruit was so small as to be insignificant.  
None of Australia's criticisms of these studies have any merit.  In any event, Australia 
misunderstands the purpose of New Zealand's reference to these studies.  New Zealand does not contend that they are a substitute for Australia's risk 
assessment, or for the Panel's role in making an objective assessment of the matter presently before it.  Nevertheless, the Pa nel may look at the conclusions in those 
papers (as it can with respect to any other relevant scientific study) in considering 
whether the conclusions in the IRA ar e supported by the scientific evidence. 
4.152  New Zealand has also established that several of  the conclusions drawn by the IRA in relation 
to its 'importation scenario' lack sufficient support in  the scientific evidence relied upon.  Australia has 
failed to rebut these criticisms.  For example, Aust ralia has failed to rebut New Zealand's argument 
that the IRA's conclusion on the probability of entry of E. amylovora  into Australia is greatly inflated 
and is not supported by the scientific evidence.  Nor has Australia rebutted New Zealand's case that 
there is no evidence to support Australia's crucia l transmission ("exposure") theory.  Australia 
speculates that E. amylovora would be transferred from mature, sy mptomless apples, either by insects WT/DS367/R 
Page 98  
 
 or by mechanical means, to susceptible hosts, under natural conditions, and that  an infection would be 
initiated.  New Zealand maintains its claim that there is no scientific evidence that, under natural 
conditions, low (or any) numbers of E. amylovora bacteria on mature apple fruit can be transferred 
onto a susceptible host and result in an infection.  To the contrary, the scien tific evidence shows that 
the likelihood of such occurrence is  so small as to be insignificant. 
4.153  In addition, the experts' responses cast furthe r doubt on the conclusions Australia draws in 
relation to its importation steps for E. amylovora ;  the likelihood of importation of E. amylovora ;  and 
the probability of E. amylovora  being transferred to and infecting a susceptible host. 
4.154  The IRA's conclusions about entry, estab lishment and spread of European canker
, as well as 
its assessment of consequences are not supported by sufficient scientific evidence.  In New Zealand's 
first written submission, in addition to noting the l ack of scientific support for the pathway as a whole, 
New Zealand pointed out the lack of scientific suppor t for the individual steps in the pathway.  In 
particular, there is no objective or rational re lationship between the scientific evidence and the 
probability value that is chosen at each step of Aust ralia's European canker pathway.  In other words, 
the conclusions drawn by the IRA do not find suff icient support in the evidence relied on.  The 
experts' responses confirm the lack of scientific evidence for almost every step of the pathway. 
4.155  The probability value assigned to the likelihood that infected fruit may be picked (importation 
step 2) is exaggerated in light of the absence of confirmed reported instances of latent fruit infections 
in New Zealand due to the unfavourable summer clim atic conditions in New Zealand's apple growing 
regions.  Australia relies primarily on the unveri fied personal communication referenced in the 
Braithwaite report and data from Northern hemis phere countries with climatic conditions more 
favourable to fruit infection, to ju stify its conclusion in relation to this step, but these do not provide 
the necessary scientific support. 
4.156  In addition, the experts confirm the lack of scientific support for the IRA's conclusions with 
respect to the likelihood that fruit may beco me surface-contaminated (infested) with N. galligena 
(importation steps 3, 5 and 7).  Australia attemp ts to downplay the significance of these importation 
steps to the IRA's assessment, descr ibing them as of only "minor" concern, but in fact they account for 
more than 80 per cent of the total probability of entry.  The experts also support New Zealand's 
arguments that the IRA's conclusi ons regarding the survival of N. galligena  during packing house 
processes and transport to Australia (importation st eps 4 and 6) do not find sufficient support in the 
scientific evidence relied on. 
4.157  As a consequence, the IRA arrives at an inflat ed estimate of the overall probability of entry, 
which estimates that approximately 1 in 15,000 New Zealand apples arriving into Australia would be 
latently infected or infested.  Such a conclu sion is not supported by the scientific evidence. 
4.158  Australia has also failed to rebut New Zeal and's argument that the IRA's conclusion on 
exposure is not supported by sufficient scientific evid ence.  In particular, New Zealand pointed out the 
lack of scientific support for the IRA's conclusions  about spore production and dispersal of spores 
from rotten fruit onto a susceptible host in Austra lian conditions.  Although Australia now seeks to 
distance itself from the IRA's assumptions about mu mmified fruit producing ascospores as a source of 
new infections in Australia – assumptions which have also been dismissed by the experts – Australia's 
revised position is inconsistent with the IRA.  In a ddition, although Australia now insists that the IRA 
factored in that the dispersal range is no more th an a few metres, this is not evident from the IRA.  
Finally, Australia's focus on a "sequence of events " continues to overlook the fact that the IRA failed 
to factor in the requirement for the simultaneous inte raction of all three factors;  pathogen, host and 
climate;  in order for infection to occur.  WT/DS367/R 
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 4.159  Australia's attempted rebuttal of New Zealand's arguments on establishment and spread 
focuses on attacking New Zealand's climate analysis.  Australia's first written submission relies on its 
own deeply flawed climate analysis, which does not remedy the flaws in the IRA's original 
consideration of this crucial factor.  Australia's  rebuttal of New Zealand's arguments on alternative 
hosts continues to rely on assumptions about the clim atic similarity of Australia to regions where N. 
galligena  is present on those hosts.  These arguments cannot be sustained. 
4.160  Finally, as the experts confirm, Australia's as sessment of consequences is a significant over-
estimate, as once again Australia has failed to cons ider its own circumstances, in particular the 
unfavourable climatic conditions. 
4.161  The IRA's assessment of risk with respect to  ALCM  is also not sufficiently supported by 
scientific evidence.  Indeed, the expert responses c onfirm that the IRA's assessment of risk is so 
flawed that it needs to be "recalculated". 
4.162  The IRA's assessment of the likelihood that picked fruit will be infested with ALCM 
(importation step 2) has no scientific basis because it did not take into account the scientific evidence 
on viability.  The IRA's conclusions with respect to  the likelihood of contamination of New Zealand 
apples during packing and transport (importati on step 3) also have no scientific basis. 
4.163  Australia's only response to the numerous flaw s in the IRA's estimate of the likelihood of 
ALCM entry is to concede that the IRA's eight st ep analysis of the likelihood of ALCM entry is 
irrelevant because it also used the August 2005 data provided by New Zealand.  Australia's readiness 
to discard a significant part of its risk assessment is striking and calls into question the soundness of 
the rest of Australia's risk assessment. 
4.164  The IRA's assessment of the likelihood of ALCM establishment and spread, and related 
consequences, also has no scientific basis.  There is no scientific support for the IRA's key 
assumptions in respect of ALCM biology and the effect of normal trade practices on the risk 
associated with the importation of apples from New Zealand. 
4.165  Finally, Australia has failed to evaluate the lik elihood of entry, establishment and spread of 
each pest "according to the SPS measures which might be applied" .  Australia does not contest the 
IRA's lack of evaluation of what it terms 'ancill ary' measures, but relies instead on its flawed 
principal/ancillary distinction to argue, incorrectly , that it is under no obligation to do so.  In any 
event, the jurisprudence is clear th at even what Australia calls 'ancillary' measures must be evaluated.  
Further, Australia responds to the argument that it has failed to consider the retail-ready measure put 
forward by New Zealand by misinterpreting the relevant case law. 
(vii) Australia's measures are inconsistent with Article 5.2 
4.166  Australia is incorrect to claim that it was not  required, under Article 5.2, to give genuine 
consideration to the factors identified by New Zeal and.  Australia has failed to rebut New Zealand's 
case that these factors were not taken into account in the IRA. 
(viii) Australia's measures are inconsistent with Article 5.5 
4.167  New Zealand showed in its first written submis sion that the way Australia treats the similar 
risks associated with Japan ese nashi pears and New Zealand apples constitutes a breach of Article 5.5. 
In response, Australia effectively concedes that the diseases are comparable (Japanese Erwinia and 
fire blight; and brown rot and European canker respectively) and focuses almost exclusively on 
showing differences in risks between the two situations.  Australia relies on, inter alia :  "assumptions" 
about area freedom in export areas;  a flawed interpre tation that situations must be current in order to WT/DS367/R 
Page 100  
 
 be compared;  arguments about the relevance of trade volumes which are not borne out by the 
measures applied to Japanese nashi pears;  and su pposed differences in consequences which are not 
even supported by Australia's own assessments in the context of its Draft China Apples IRA.  Despite 
the similar risks, Australia applies no measures to  Japanese Erwinia, and the measures applied to 
Japanese nashi pears in respect of brown rot are mu ch less onerous than those applied to New Zealand 
apples in respect of European canker.  Australia  is unsuccessful in its attempts to downplay or 
discredit the warning signals and additional factors identified by New Zealand, and taken into account 
in previous cases, as demonstrating discrimination a nd a disguised restriction on international trade. 
(ix) Australia's measures are inconsistent with Article 5.6 
4.168  Australia's primary objection to the alternativ e measures identified by New Zealand is that 
they would not meet Australia's ALOP, based on th e assessments of risk contained in the IRA.  
However, New Zealand challenges these assessments of risk.  There is no scientific evidence that 
mature, symptomless apples can provide a pathway fo r the introduction of fire blight or European 
canker into Australia, or that their importation would result in ALCM establishment and spread.  
New Zealand's alternative measures therefore meet Australia's ALOP. 
4.169  Australia's proposed general measures are not required in respect of any other New Zealand 
exports.  Australia has not provided any explanation as to why these are necessary to meet Australia's 
ALOP, and its efforts to downplay their restrictiveness are incorrect.  New Zealand's proposed alternative (audits of WTO compliant measures) is  consistent with existing arrangements between 
Australia and New Zealand and meets Australia's ALOP. 
(x) Australia's measures are inconsistent with Article 8 and Annex C(1)(a)  
4.170  Australia has not responded to New Zealand' s substantive arguments regarding "undue 
delay", arguing only that the "IRA process" is not a measure at issue.  However, New Zealand's claim 
is that the measures resulting from the IRA pro cess are the measures at issue under this claim. 
4.171  The 8 years (94 months) taken to complete the IRA clearly exceed what was reasonably 
necessary given that:  Australian officials origina lly expected the process to take 12 months;  
Australian IRAs must now be completed within 24-30 months;  similar IR As had been conducted 
previously;  there was no difficulty gaining access to the scientific information;  there was no 
significant evolution of the science during this peri od;  and there is no reasonable explanation that 
would justify the time taken to complete the IRA.  Australia has not rebutted the evidence provided by 
New Zealand of a parallel and intertwined political pro cess that helps to explain, but not justify, this 
delay. 
(c) Conclusion 
4.172  For these reasons, further developed in the body of its second written submission, 
New Zealand reaffirms the request in its first writte n submission that the Panel find that Australia's 
measures are inconsistent with the SPS Agreement. 
5. Executive summary of New Zealand's opening oral statement at the second substantive 
meeting 
(a) Introduction 
4.173  Australia has failed to rebut New Zealand's cas e that Australia's measures are not supported 
by scientific evidence and the IRA does not cons titute a risk assessment whose conclusions are  WT/DS367/R 
 Page 101 
 
 
 objectively justifiable.  The experts reiterated wh at they said in their reports and they too 
demonstrated that the conclusions of the IRA are not supported by scientific evidence. 
4.174  The experts confirmed that there is no scientif ic evidence to support Australia's conclusions 
that mature apples pose a risk of introduction of  fire blight.  The IRA's overall probability of 
importation is unsupported by scientific evidence, as are its conclusions in relation to most of the 
importation steps.  Dr Paulin concluded that the risk  of fire blight from trade in apples is about as 
likely as the risk of such transmission by insects carri ed by air currents from New Zealand, i.e. there is 
no greater risk than through natural dispersal.  Imposing measures on apples creates no greater protection than having no measures. 
4.175  With respect to European canker, the experts confirmed that there is no evidence that apple 
fruit are responsible for dissemination of the disease to new areas.  There is no basis for concluding 
that a mature, symptomless requirement would not meet Australia's ALOP.  Dr Swinburne described 
the risk of transfer via apples as "vanishingly sma ll".  The real risk of transfer is through the 
movement of planting material.  In addition, the e xperts confirmed the insufficiency of the scientific 
evidence supporting the IRA's conclusions as to in dividual importation steps and the probability of 
entry, exposure, establishment and spread.  The expe rts also considered that the IRA's assessment of 
consequences was flawed. 
4.176  In respect of ALCM, the expert view was unequivocal.  By ignoring viability, parasitism, the 
prolonged period of adult ALCM emergence, and mode of trade issues, and by making assumptions 
that were not based on scientific evidence, the IR A overestimated the likelihood of ALCM entry and 
establishment.  Indeed, the ALCM expert, Professor Cr oss, concluded that the risk assessment was so 
flawed that it needed to be "recalculated". 
(b) Australia's second written submission 
4.177  Australia's argument about principal and ancillary measures finds no basis in the 
SPS Agreement.  If principal and ancillary meas ures are capable of giving rise to violations 
"collectively", then they must also be subject to  the obligations "collectively" and need to be 
evaluated "collectively" with principal measures to  assess their impact on risk.  The IRA did not do 
this. 
4.178  Since Canada – Continued Suspension  the law relating to standard of review has not changed.  
The Appellate Body simply applied well-established principles prohibiting de novo  review, and 
affirmed the right of Members to rely on diverg ent scientific evidence.  Although Australia now 
claims to have renounced the use of the terms "def erence" and "considerable deference", the decision 
in Continued Suspension  is treated by Australia as embodying a "considerable deference" standard.  
Clearly it does not do so. 
4.179  Australia claimed that the IRA is supported by  unspecified divergent scientific evidence or 
that the IRA was itself divergent scientific evidence.  Unable to find sufficient scientific support for 
its measures, Australia now claims there is "scien tific uncertainty", such that deference must be 
accorded to the expert judgement of the risk assessors.  Although the term "scientific uncertainty" 
does not appear in the SPS Agreement, it provid es a framework for managing scientific uncertainty, 
through Article 5.7 and the right to rely on divergent scientific opinion.  Beyond this, notions of "scientific uncertainty" and "expert judgement" pr ovide no justification for avoiding the science-based 
obligations in the SPS Agreement, or for suggesting that deference be accorded to the views of the 
risk assessors.  The fact that Australia cannot find data or scientific studies to support its conclusions 
underlines the speculative and hypothetical nature of th e pathways considered.  This is not a situation 
of scientific uncertainty;  it is an example of  the scientific evidence not supporting Australia's 
measures. WT/DS367/R 
Page 102  
 
 4.180  Australia also places weight on conclusions wh ich it asserts the IRA Team reached but which 
are not reflected in the IRA itself, for example impo rtation steps 3, 5 and 7 in respect of European 
canker.  Transparency is an integral part of objec tive justifiability.  Claimed backroom deliberations 
of the IRA Team are irrelevant. 
(c) The task of the Panel 
(i) Standard of review 
4.181  In accordance with DSU Article 11 the task of the Panel is to "objectively assess" the claims, 
evidence and arguments before it, and to determine whether the measures at issue are consistent with 
the relevant provisions of the SPS Agreem ent.  The Panel should not conduct a de novo  review or do 
its own risk assessment.  The focus must be on re viewing the sufficiency of the scientific evidence 
underlying Australia's measures.  The Panel enjo ys discretion as to which evidence to utilise in 
making its findings, and the value and weight to be ascribed to that evidence.  This mandate applies 
under both Article 2.2 and Article 5.1. 
4.182  The Appellate Body in Continued Suspension  stated that a panel's role under Article 5.1 is to 
"determine whether [a] risk assessment is supported by coherent reasoning and respectable scientific 
evidence and is, in this sense, objectively justifiabl e".  This requires determining whether the measure 
is based on science coming from a respected and qua lified source, i.e. it has "the necessary scientific 
and methodological rigour to be considered reputable  science", and whether "the reasoning articulated 
on the basis of the scientific evidence is objective a nd coherent".  The Appellate Body stated that this 
requires a panel to "review whether the particular  conclusions drawn by the Member assessing the 
risk find sufficient support in the scientific evidence relied upon". 
4.183  Continued Suspension  does not support Australia's claim that New Zealand must demonstrate 
"serious flaws" with respect to each and every conc lusion in the IRA.  The focus must be on whether 
the IRA is "objectively justifiable", requiring an assessment of the cumulative effect of the IRA's many flaws.  The Appellate Body reaffirmed the "b road discretion" that panels have in exercising 
their "significant investigative authority" to consu lt experts.  In making its "objective assessment" the 
Panel will consider the relevancy and weight to be  attached to the experts' comments in deciding 
whether the IRA is supported by sufficient scientific  evidence.  This "objective assessment" should be 
carried out in light of the well-established rules rega rding burden of proof.  Australia's suggestion that 
New Zealand faces a higher burden of proof in this case should be rejected as yet another attempt to 
shelter its risk assessment from proper review. 
(ii) Relationship between Articles 2.2 and 5.1  
4.184  Australia's original argument was that Article 5.1 had to be considered first because 
compliance with Article 2.2 "can only be answered " by reference to Article 5.1.  New Zealand 
demonstrated this argument is incorrect.  Austra lia now says that "the standard established by 
Article 2.2 is fully met if the risk assessment satisfi es the conditions elaborated in Article 5.1."  This 
says nothing about the order in which those provisi ons should be assessed, and is also incorrect.  A 
determination that there has been a risk assessment within the meaning of Article 5.1 does not resolve 
whether each of the challenged measures has a ra tional and objective rela tionship with scientific 
evidence under Article 2.2. 
(iii) The weight to be given to Japan – Apples 
4.185  In Japan – Apples 
the panel concluded that the scientific evidence did not establish that 
mature, symptomless apple fruit would be infected by fire blight, or harbour endophytic populations 
of E. amylovora , or harbour epiphytic populations of bacteria capable of transmitting fire blight.  And  WT/DS367/R 
 Page 103 
 
 
 the panel in Japan – Apples  concluded that the scientific eviden ce did not establish that apple fruit – 
whether mature or immature – would serve as a means or pathway for the introduction of fire blight to 
a fire blight-free area.  The panel's conclusions in Japan – Apples were reached on the basis of 
substantially the same scientific evidence as that consid ered in the context of this dispute.  If the Panel 
were to reach the same conclusions in relation to the scientific evidence as were reached in Japan – 
Apples , then it would inevitably follow that Australia' s fire blight measures are maintained without 
sufficient scientific evidence, in breach of Article 2. 2.  This would not constitute "deferring" to the 
findings in Japan – Apples  as Australia asserts;  it would be the result of an objective assessment 
required under DSU Article 11. 
4.186  Australia's arguments for ignoring Japan – Apples  cannot be sustained, because the 
conclusions in Japan – Apples  relate to the same matters in issue in the present case.  Contrary to 
Australia's argument, the conclusions in Japan – Apples  relate equally to epiphytic infestation as 
endophytic infection.  The consequences of the intr oduction of fire blight were taken into account, as 
was the volume of international trade in apple fruit.  Australia fails to point to  any scientific evidence, 
considered by the IRA team but not considered in Japan – Apples , that would have altered the panels' 
conclusion in that case. 
(d) Article 2.2 
(i) Fire blight 
4.187  New Zealand's central argument in relation to fire blight is that there is no scientific evidence 
that mature, symptomless apples provide a pathway fo r the introduction of the disease.  First, mature 
apple fruit are not a conducive environment for E. amylovora .  Second, the likelihood apples will 
enter Australia with E. amylovora  on them is very small and there is no evidence to justify the high 
figure that Australia has used in the IRA.  Third, as confirmed by the experts, there is no scientific 
evidence of transfer of bacteria from a mature appl e to a susceptible host and an infection resulting.  
The only scientific evidence goes the other way. 
4.188  Australia fails to point to any "interpretati on" of the scientific evidence that supports its 
pathway hypothesis apart from the so -called "divergent scientific evidence" of the IRA itself, or the 
exercise of the IRA Team's "expert  judgement" in relation to matters  of "scientific uncertainty".  
Thus, according to Australia, the IRA itself beco mes scientific evidence sufficient to satisfy 
Article 2.2.  But, Australia cannot by these means escape the core obligation of Article 2.2, not to 
maintain measures without su fficient scientific evidence. 
4.189  Equally, New Zealand has no obligation to prove that apples are not a pathway for the 
introduction of fire blight.  New Zealand has estab lished a prima facie case that there is no evidence 
of a pathway and it is for Australia to point to the scientific evidence that supports its contention that a 
pathway exists.  It has not, and it cannot do so.  Acco rdingly, Australia maintains fire blight measures 
without sufficient scientific eviden ce, in breach of Article 2.2. 
(ii) European canker 
4.190  The measures established by the IRA are not based on sufficient scientific evidence, contrary 
to Article 2.2.  The experts have confirmed there is  no scientific evidence of the transfer of European 
canker through trade in mature, apple fruit.   Australia argues that latent fruit infection is a widely 
accepted phenomenon, and that because latent fruit inf ection occurs in some Northern Hemisphere 
countries, it also occurs in New Zealand.  This fa ils to take account of the effect of climatic 
differences.  The only evidence Australia provides on latent infection in New Zealand is the 
Braithwaite report, which the experts conf irm is neither relevant nor reliable. WT/DS367/R 
Page 104  
 
 4.191  Further, there is no scientific evidence to supp ort the contention that European canker could 
establish via discarded fruit, let alone spread under Au stralian conditions.  In particular, the experts 
confirm that there is no evidence in th e literature that fruit rots caused by N. galligena are a source of 
new infections in new areas.  In addition, the IRA's assumptions about the climate of Australian 
apple-producing regions are not based on scientific ev idence.  Australia's new "climate analysis" is 
simply a collection of weather data with no predic tive value and fails to contradict New Zealand's 
position. 
4.192  Australia's argument that Tasmania is less suitable for European canker establishment and 
spread than other parts of Australia is not supp orted by the first BRS report which Australia relies 
upon.  And Australia contradicts the conclusions in the IRA by suggesting that the outbreak of disease 
in Tasmania may not have been caused by N. galligena at all. 
(iii) ALCM 
4.193  There is no scientific evidence that the seque nce of events required for ALCM establishment 
in Australia – many thousands of apples left outsi de of cold storage, uncovered, in the same place, 
over a considerable period of time, within the lim ited female ALCM flight range of newly unfurling 
apple leaves – would occur.  Indeed, there is no scien tific evidence that ALCM has ever been vectored 
by trade in apples.  As confirmed by the expert  responses, the existing scientific literature instead 
links the movement of ALCM to planting material. 
4.194  Australia claims that enough New Zealand apples could be sent to orchard wholesalers for 
mating to occur.  But retail ready packaged New Z ealand apples are extremely unlikely to be sent to 
orchard wholesalers, the only utility point within su fficient proximity to apple trees, leaving, in 
Professor Cross's words, "virtually no opportunity for ALCM to emerge, mate, exit the packing house 
and locate a susceptible apple tree". 
4.195  Only once New Zealand apples reach their final retail destination and are outside of cold 
storage could emergence occur.  But, by then, New Zealand apples would never be in the quantities 
required for ALCM mating.  Because of the very lo w level of viable cocoons on New Zealand apples, 
the prolonged period of emergence of ALCM adults and their very short life-span, many thousands of 
apples would need to be outside of cold storage, in the same place, over an extended period of time, 
for there to be any possibility of mating occurring.  Au stralia failed to take su ch matters into account.  
Instead, Australia's measures are based on the in correct assumption that ALCM emergence would 
occur immediately from all cocoons on New Zeala nd apples, an assumption th at has no scientific 
basis.  Australia's claim that emergence and mating could occur while apples are on display at retail 
outlets, open-air markets or when dumped as waste is therefore implausible. 
4.196  As Australia has itself admitted, urban retailers are very unlikely to be near enough to apple 
trees for egg laying to occur.  Thus, even if suffi cient quantities of apples were on display at retail 
outlets or open air-markets, they would not be within  the female ALCM's flight range of apple trees.  
Likewise, even if apple waste was disposed of in the volumes required for mating, it is extremely 
unlikely that it would be left near commercial apple trees.  Australia's argument that "large quantities 
of fruit waste may be left uncovered in production ar eas" and may be "dumped under host plants", is 
made without any supporting evidence.  Such prac tices would be directly contrary to Australian 
orchard biosecurity best practice guidelines which require agricultural waste to be destroyed or 
disposed of well away from orchards.  Australia 's measures are therefore maintained without 
sufficient scientific evidence, in violation of Article 2.2. 
4.197  In addition, there is no scientific support for the general measures that apply to all three pests, 
in breach of Article 2.2.  WT/DS367/R 
 Page 105 
 
 
 (e) Article 5.1 
(i) Methodology 
4.198  New Zealand has demonstrated that the "negligible" interval (between 0 and 10-6) used in the 
IRA to represent events that "almost certainly will not occur" includes values that significantly 
overestimate the risk.  The use of a uniform dist ribution weights the outcome in favour of those 
values.  The result is that these are no longer ev ents that "would almost certainly not occur". 
4.199  This approach is not, in any sense, objectivel y justifiable.  The IRA simply applied pre-
determined probability intervals taken from generi c draft "Guidelines" developed in a completely 
different context.  The IRA contains no explanat ion or analysis as to why these pre-determined 
probability intervals were appropria te in the context of a risk assessment for apples.  The IRA took no 
account of the implications of applying these pre-determined probability intervals when the unit 
considered (a single apple) is traded in the tens  of millions (the IRA's model was based on a "most 
likely volume of trade" of 150 million apples).  In th is context the maximum value of the "negligible" 
interval represents one in a million apples, and a pplying a uniform distribution results in outcomes 
that tend toward the average of one in two million apples.  The "negligible" interval is the lowest 
probability interval used in the IRA.  Despite Aust ralia's claim that the IRA Team were free to use 
other intervals, not once was a lo wer probability interval applied. 
4.200  There is no objective basis for the parameters a nd distribution of the "negligible" interval.  
Australia argues that the interval w as used to "assist consistency in the risk assessment", and that "any 
choice of intervals is arbitrary".  But the parameters  and distribution of the interval have a direct and 
significant bearing on the overall estimation of risk, especially given that th e "negligible" interval 
makes up over a third of all likelihood values used in the risk assessment.  Th e values chosen must be 
objectively justifiable. 
4.201  Australia also suggests that the intervals are justified because the interval "contained" the 
actual value.  But the "negligible" interval ranges from zero to one in a million apples.  It therefore 
represents events that "almost certainly will not occu r", as well as events that manifestly would occur.  
Systematically combining this interval with a uni form distribution means that higher likelihoods are 
significantly over-represented. 
4.202  Australia claims that "[t]he IRA Team applie d expert judgment in a rriving at appropriate 
distributions taking into account available data  and the uncertainty resulting from the absence of 
data".  However, simply claiming that "expert j udgement" has been applied does not establish that the 
outcome is "objectively justifiable".  Australia purpor ts to render its risk assessment self-justifying.  
Moreover, it is difficult to see in what sense the IR A Team applied "expert judgement" in the context 
of the "negligible" interval.  Pre-determined prob ability intervals were simply imported from another 
context without analysis.  The same interval was us ed every time a "negligible" interval was applied.  
And a uniform distribution was applied almost ever y time.  Beyond concluding that this broad and 
over-inclusive interval "contained" the actual value,  the role of expert judgement is not apparent. 
4.203  Furthermore, the quantity and quality of the data  are factors that should be considered in 
deciding what methodology to apply.  The experts' re plies have made it clear that the incorporation of 
quantitative elements into a methodology is meant to add precision where available data and scientific 
evidence make this possible.  It is not supposed to create imprecision through the systematic 
application of uniform distributions, justified on th e basis of "significant uncertainties".  This is 
especially so where the interval in questi on ranges across several orders of magnitude. 
4.204  Australia's description of the method used to arrive  at an expert opinion appears to have been 
an unstructured process, not following any recogn ized method for eliciting and combining expert WT/DS367/R 
Page 106  
 
 opinions in order to derive a particular range of values and distributions, casting doubt on the notion 
that a coherent and objective process was used. 
4.205  Australia's estimate of a most likely import quantity of 150 million New Zealand apples 
annually (15 per cent of Australia's domestic fr esh apple fruit market) also lacks any objective 
justification, and is based on a range of unsuppor ted assumptions and suppositions.  But despite the 
many uncertainties inherent in Australia's conclusion on the likely volume of trade, and the doubts 
raised by New Zealand, Australia firmly clings to  its estimate.  This is no doubt because of the 
importance of volume of trade to Australia's risk analysis methodology.  As the IRA itself acknowledges, "very low exposure values expressed on a per apple basis could be highly significant 
when the potential volume of trade is taken into account".  This reflects an unstated motivation 
underlying Australia's application of the semi-qua ntitative methodology;  to use volume of trade to 
boost the estimated risk associated with New Zealand apples to a level that Australia claims justifies 
phytosanitary measures. 
(ii) Fire blight 
4.206  The experts confirmed that many of the conclusi ons in the IRA relating to fire blight lack 
sufficient scientific support.  This was true of im portation steps 1, 2, 3, 4, 5 and 7, the IRA's 
conclusions in relation to the ove rall probability of importation of E. amylovora , and in relation to the 
probability of exposure of a susceptible host to E. amylovora .  Rather, the experts confirmed that the 
IRA's conclusions are fundamentally flawed and not  objectively justifiable.  Their responses confirm 
that "the scientific evidence actually relied upon  did not support the conclusions drawn", and that 
Australia's theory that mature apples provide a pathway for the introduction of fire blight has no 
scientific support. 
4.207  Unable to challenge the substance of the expe rts' responses, Australia  has instead: attacked 
their qualifications;  asserted that the flaws found by  the experts were not serious enough to require 
the Panel to do anything;  and argued that the Pane l or New Zealand needs to see whether alternative 
probabilities are available on the evidence.  This, in effect, asks the Panel and New Zealand to redo 
the risk assessment.  None of these arguments withstands analysis. 
4.208  Under Article 5.1, the task of the Panel is to review Australia's risk assessment, not to conduct 
a de novo  review, or redo the Australian risk assessment.  New Zealand's claim that the IRA fails to 
provide a risk assessment in respect of fire blight has been confirmed by the experts and is not rebutted by Australia. 
(iii) European canker 
4.209  New Zealand has demonstrated, and the experts ha ve confirmed, that the IRA's conclusions in 
relation to the probability of entry, establishment and spread of N. galligena , and its conclusions on 
consequences, do not find sufficient supp ort in the scientific evidence relied on. 
4.210  New Zealand challenges the IRA's assessment of  the probability that latently infected fruit 
will be harvested from New Zealand orchards.  As the experts confirm, Australia has not provided 
sufficient scientific evidence to support the values a ssigned to this step.  Moreover, in assigning an 
effective probability of 1 to survival of latent infections through processing in the packing house, the 
IRA does not take into account that fruit would be stored in New Zealand until grading and packing 
for just in time delivery to the Australian market.  Thus, any rots which developed in storage would be 
removed prior to export, reducing the possibility of the entry of infected fruit into Australia. 
4.211
 Australia also asserts that "surface infestation of mature apples occurs in New Zealand, both 
in the field and in processing".  However there is no evidence of surface contamination.  The experts  WT/DS367/R 
 Page 107 
 
 
 conclude that contamination would not "play any part in an entry pa thway" and that "this possibility 
should be disregarded from the risk analysis".  Si nce the surface contamination pathways under the 
IRA account for more than 80 per cent of the total probability of entry, it is impossible to have any 
confidence in the conclusions of the IRA. 
4.212  Australia now argues that New Zealand (and by implication the experts) have misunderstood 
the IRA's methodology and that surface infestation is only a precursor to latent infection and in this 
way importation steps 3, 5 and 7 refer also to late nt infection.  However the IRA does not discuss how 
or when fruit infestations would turn into fruit in fection or evaluate the likelihood of this event 
occurring.  In any event, there is no scientific  evidence to support the contention that surface 
infestations will lead to infections at each of these steps and this was confirmed by the experts. 
4.213  Australia also claims expert support for its exposure scenario, but it can only do so by 
selectively quoting from the experts' responses.  In fact, Professor Latorre challenges the probability  
values assigned by the IRA team.  And, both Drs. Swinburne and Latorre identified numerous reasons 
why the scientific evidence does not support the IRA's conclusion on exposure. 
4.214  In its first written submission, New Zealand established that the IRA's analysis of climate was 
flawed and that the climatic conditions in Australia  were not suitable for the establishment and spread 
of European canker.  The experts confirm that there is no evidence to support the IRA's use of 
1000mm rainfall as the relevant climatic indicator  for European canker establishment.  In its 
subsequent climate reports, Australia employs sel ective weather data, fails to take account of 
inoculum production and inappropriate ly uses "one off" weather events  to predict establishment risk.  
Australia's use of different predictive models to bol ster the IRA's conclusions as to the suitability of 
Australia's climate are deeply flawed and confirm that it is necessary to over-predict European canker 
risk in order to support the IRA's conclusions. 
4.215  As New Zealand has established and the experts confirm, Australia's assessment of 
consequences is significantly over-estimated.  Austra lia's arguments rest on the flawed premise of the 
suitability of its climate and assertions about the abili ty of the disease to establish on alternative hosts 
in Australia, which are not supported by scientific evidence. 
(iv) ALCM 
4.216  New Zealand has demonstrated that the conclu sions drawn by the IRA in relation to the 
likelihood of entry, establishment and spread of ALCM, and the IRA's assessment of consequences, 
do not find sufficient support in the scientific evid ence relied on.  This has been confirmed by the 
experts, who describe the IRA's analysis of the lik elihood of importation as "unclear", reliant on "old 
and inadequate published data", "subject to larg e uncertainties" and, most importantly, without 
"sufficient scientific evidence". 
4.217  Australia's only response is its claim that the IRA's assessment of the likelihood of 
importation of ALCM is "irrelevant" because the IR A also relied on the August 2005 data.  However, 
the IRA's failure to take into account the scientific  evidence on viability is relevant not only to the 
IRA's conclusions on importation, but also to the entire assessment of risk, including  the IRA's 
alternative conclusions on the likelihood of entr y, establishment and spread, based on the August 
2005 data, which related to occupi ed cocoons and not, as Australia incorrectly assumed, viable 
cocoons. 
4.218  In an apparent acceptance of the IRA's failings with respect to viability, Australia has put 
forward various justifications, including that  Australia was entitled to ignore Rogers et al.  2006 
because its methodology was flawed and its results we re unclear.  Australia also claims that seasonal 
and varietal variability and scientific uncertainty miti gate the IRA's errors.  But none of these factors WT/DS367/R 
Page 108  
 
 can cure the IRA's complete disregard of viability.  While uncertainty may be an inherent part of risk 
analysis, it is not a licence to ignore inconvenient evidence. 
4.219  As New Zealand has explained, the high rate of non-viable cocoons on New Zealand apples 
substantially affects the risk of ALCM establishing in Australia.  As Professor Cross has said, the 
issue of viability is of "crucial  importance … in calculating risks a nd determining appropriate sample 
sizes…" 
4.220  Moreover, as pointed out by Professor Cross, many of the key biological conclusions in the 
IRA with respect to the likelihood of ALCM establis hment in Australia are not supported by scientific 
evidence.  Even if there may be some uncertainty  as to precisely when and how long it will take for 
adults to emerge there is no doubt that Australia's  assumption of simultaneous emergence as soon as 
apples are removed from cold storage has no scientif ic support.  As Professor Cross pointed out, the 
prolonged period of emergence s ubstantially decreases the chance of male and female emerging 
during the necessary time frame for mating.  To quote Professor Cross, "The risk of establishment is 
thus substantially reduced and this  important factor has not been taken into account in Australia's 
IRA…" 
4.221  The IRA also failed to take into account that standard commercial practices in Australia in 
respect of cold storage of fruit and agricultural w aste disposal preclude any likelihood of the scenario 
required for ALCM establishment occurring in Australia .  Australia claims that the IRA was correct to 
ignore Australian waste disposal practices because th e Australian industry is unl ikely to comply with 
them.  This is a rather surprising proposition and it  is a view not shared by Professor Latorre, who had 
a much more generous view of the "cultural attitude of Australian people" to the disposal of waste.  
Moreover, the waste disposal practices at issue are prescribed in the manual of Australian orchard 
biosecurity best practice guidelines. 
4.222  The IRA also failed to take into account the cruc ial issue of mode of trade, a matter that was 
noted by the ALCM expert.  If New Zealand apples are exported retail ready to Australia, the primary 
pathway identified by the IRA for ALCM establis hment – orchard wholesalers – would disappear. 
4.223  Finally, the IRA's assessment of the likelihood of ALCM spread and consequences failed to 
take into account the climatic factors required for establishment and spread and therefore over-
estimated consequences.  This, too, was confirme d by the experts and appears to be accepted by 
Australia. 
4.224  With respect to Articles 5.2, 5.5, 2.3 and 5.6, New Zealand reaffirms its position on these 
provisions as stated in its earlier pleadings. 
(f) Article 8/Annex C 
4.225  The IRA process took 8 years to complete.  Aust ralia has offered no justification for this 
delay.  Rather than countering New Zealand's subs tantive claim, Australia continues to relitigate the 
Panel's preliminary ruling.  Australia wrongly equa tes the IRA process with the measures at issue, 
blurring "the distinction between measures  and claims ".  The IRA process is the subject of the 
obligation, not the measure at issue.  Moreover,  Australia has not explained how the IRA process, 
which has ceased to exist, could be a challengeable  measure under the DSU.  It is well-established 
that "the measures included in a panel's terms of re ference must be measures that are in existence at 
the time of the establishment of the panel".  Fina lly, it is difficult to understand how Australia could 
not have known what case it had to answer.  It was not necessary for Australia to know precisely what 
arguments New Zealand would be making to be on no tice to begin preparing a defence in relation to 
its eight year delay.  WT/DS367/R 
 Page 109 
 
 
 6. New Zealand's closing oral statement at the second substantive meeting 
4.226  New Zealand's closing statement will be brief.  What New Zealand would like to do is come 
back to the fundamentals – the core of this case – because much has been said throughout this case by 
Australia to distract from that central core. 
4.227  The Panel has heard over the course of these proceedings many arguments by Australia about 
what should be taken into account in the assessment of the evidence in this case.  These have included 
the notions of considerable deference, scientific uncertainty, and expert judgment.  And in their 
opening statement, Australia tried to characterize New Zealand's position as one of requiring scientific certainty.  And under the guise of considering the "practical realities of conducting risk assessments" 
Australia seemed to be asking you to roll back the disciplines of the SPS Agreement.  But the Panel's 
task need not be trammeled by th ese efforts to confound the issue. 
4.228  The central question is one of sufficient sci entific evidence.  New Zealand has made 
arguments and produced evidence to show that it is lacking.  The Panel now has to consider all the 
evidence and the arguments presented, consider the e xperts reports and what the experts said in the 
meeting with them, and consider whether the Au stralian measures are based on sufficient scientific 
evidence, whether the alleged scientific basis for the measures is objective and credible, and whether 
the risk assessment is "objectively justifiable". 
4.229  The essence of this case is that Australia has imposed measures on the importation of apples 
from New Zealand that are not based on sufficient scientific evidence, indeed in most instances not 
based on scientific evidence at all.  The Panel h as seen the arguments of New Zealand where this has 
been set out.  The Panel has seen the reports of the experts that confirmed this and it has heard them 
repeat that confirmation earlier this week. 
4.230  And it is not surprising that this should be so.  In respect of fire blight the matter was 
completely reviewed in Japan – Apples .  The panel looked at the scientific evidence and found that 
there was nothing to support the view that apple fruit provide a pathway for the introduction of fire blight.  That in substance was th e same scientific evidence that was reviewed in the IRA and has been 
discussed throughout these proceedings.  There was not hing new to consider.  There was no scientific 
evidence then of a pathway for the transmission of fi re blight by mature, symptomless apple fruit, and 
there is none today.  Of course, as the experts said,  it cannot be completely ruled out, but its likelihood 
is no greater than the movement of fire blight thr ough natural dispersal.  This means that measures on 
apple fruit provide no additional protection against fire blight. 
4.231  In respect of European canker and ALCM the science has been less abundant, but that which 
exists does not support the Australian theory.  More  fundamentally, in arguing that European canker 
and ALCM could enter, establish and spread th rough trade in apple fruit, Australia is positing 
something that has never been shown to occur either  through experimentation or in the real world.  
This was reiterated quite emphatically by the expe rts during the meeting with the Panel.  The Panel 
heard Dr Swinburne and Dr Latorre say this a bout European canker, and Professor Cross speaking 
about ALCM.  And, in respect of all of the pest s New Zealand heard the same statement from the 
experts;  transmission is not through mature fruit, it is through planting material. 
4.232  In the face of this lack of the needed scien tific evidence to support the measures for each of 
the pests, Australia is clearly in violation of its  obligations under Article 2.2 of the SPS Agreement. 
4.233  The lack of scientific support also goes to the heart of the deficiency of the IRA as a risk 
assessment.  The only way the IRA could find that Australia's ALOP was not met was to apply a 
methodology in a way that is not objectively justifia ble.  This involved applying probability intervals 
to the notion of "negligible" risk that transformed events that woul d almost certainly not occur into WT/DS367/R 
Page 110  
 
 events that would occur with some frequency.  An  event that almost certainly would not occur was 
now becoming an event that would occur once in every 2 million apples in a trade that would be in millions of apples per year.  And, nothing New Z ealand has heard at the second substantive meeting 
gives it any reason to alter its position in this regard. 
4.234  If there had been the supporting scientific ev idence, the IRA Team could have adopted a 
methodology that was objective and credible, and the result may well have been objectively 
justifiable.  But in the absence of  scientific support, the only way that measures could be justified was 
to apply a flawed methodology that arbitrarily magni fies risk and then multiplies that magnified risk 
by an inflated assumption of the volume of trade. 
4.235  Thus, Australia is forced to significantly overest imate the likelihood of events that have never 
occurred and for which there is no scientific suppor t.  As a result of the probabilities assigned under 
particular import steps, highly speculative events  become events that are predicted to produce 
thousands, sometimes tens of thousands, of infested  or infected apples entering Australia each year, 
which are then multiplied by proximity and exposur e values which themselves bear no relationship to 
the scientific evidence. 
4.236  The result is not a risk assessment that meets the requirements of WTO disciplines and it 
places Australia in violation of its obligations under Article 5.1 of the SPS Agreement.  Moreover, the 
failure of Australia to give appropriate consider ation to the requirements of the SPS Agreement has 
equally placed Australia in violation of Article  5.2 of the SPS Agreement.  These failings were 
confirmed by the experts consulted by the Panel.  The only "support" Australia can claim for its 
measures requires an assumption of a zero-risk approach to the importation  of "risk" apples.  But of 
course, this is not consistent with Australia's AL OP, or the SPS Agreement which deals with the risk 
of entry, establishment, spread  and associated consequences. 
4.237  The IRA process took place, as New Zealand h as described, in a highly charged political 
environment, and as a result it took over 8 years to complete.  And while that political context might 
explain the delay, it does not free Australia from it s obligations under Article 8 and Annex C of the 
SPS Agreement. 
4.238  The fact that Australia has imposed measures in  respect of apples from New Zealand that it 
does not impose in circumstances of comparable risk , is illustrated by the way Australia has treated 
the importation of nashi pears from Japan in viola tion of its obligations under Article 5.5 of the 
SPS Agreement. 
4.239  But, none of this needed to happen.  Th ere are measures, set out in New Zealand's 
submissions, that are reasonably available and less tr ade restrictive that would meet Australia's ALOP 
in respect of each of the pests at issue.  Failure to  apply such measures places Australia in violation of 
its obligations under Article 5.6 of the SPS Agreement. 
4.240  Thus, New Zealand has established that in  applying the 17 measures to apples from 
New Zealand set out in New Zealand's First Writte n Submission Australia is in violation of its 
obligations under the SPS Agreement. 
4.241  New Zealand would also take this opportunity to reaffirm all matters dealt with in its written 
submissions that have not been discussed in its or al statements in the second substantive meeting and 
to request the Panel to make the rulings for relie f set out in New Zealand's First Written Submission. 
4.242  Finally, New Zealand would like to take th is opportunity to thank the Panel and the 
Secretariat for all of the time and care they have devoted to this case and no do ubt will continue to do  WT/DS367/R 
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 so over the next several months.  New Zealand would also like to thank the experts for their important 
contribution to the dispute settlement process. 
4.243  That concludes New Zealand's closing statemen t.  New Zealand looks forward to responding 
to any written questions that the Panel may have. 
B. AUSTRALIA  
1. Executive summary of Australia's first written submission 
(a) Introduction 
4.244  Australia opened its market to New Zealand a pples in 2007.  This followed an extensive 
import risk analysis which recommended that a number of measures were required to mitigate the risk that the causal agents of fire blight and Eur opean canker, and apple leafcurling midge (ALCM), 
inter alia , could enter Australia with serious and irre versible consequences.  In requiring such 
measures, Australia is exercising its basic right unde r the SPS Agreement to protect its plant life and 
health from risks arising from the introduction of pests not present in Australia but endemic to 
New Zealand, at the appropriate level of protection (ALOP) determined by Australia. 
4.245  New Zealand's challenge to the trade liber alising, science-based measures, fails to 
demonstrate any breach by Australia of its WTO ob ligations.  Australia also completely rejects 
New Zealand's unsubstantiated allega tions that the preparation of the Final Import Risk Analysis 
Report for Apples from New Zealand, November 2006 (the Final IRA Report) was tainted by political 
interference.  Australia requests the Panel to disregard these allegations in their entirety. 
(b) Legal framework 
4.246  As complainant in this dispute, New Zealand must establish a prima facie case based on both 
evidence and legal argument, in relation to each of  its claims and each of the measures challenged, 
before the evidentiary burden shif ts to Australia.  However, New Zealand's submission makes flawed 
legal arguments and bald, and sometimes misleading, assertions, without submitting evidence to support many of its claims.  These failings mean that New Zealand has not discharged its burden of proof and, therefore, the presumption that Austra lia's measures are WTO-consistent has not been 
overturned.  Australia nonetheless demonstrates, th rough solid scientific evidence and legal argument, 
that its measures are fully consistent with the re levant provisions of the SPS Agreement.  While 
New Zealand is entitled to rebut Australia's argume nts, it is not entitled to remedy its failure to 
provide sufficient factual evidence in support of its claims in its first written submission, by 
introducing new evidence in the rebu ttal stage of these proceedings. 
4.247  The product and measures at issue limit the scope of  this dispute.  First, the product at issue, 
as set out in the Final IRA Report, is "mature appl e fruit free of trash, either packed or sorted and 
graded bulk fruit from New Zealand."  New Zealand' s attempts to mischaracterise the product at issue 
should be rejected by the Panel. 
4.248  New Zealand purports to challenge the 17 "measu res" specifically identified in its panel 
request, but several of those measures do not exist as New Zealand has described them.  Australia 
does not impose the orchard-suspension following pr uning requirement for European canker alleged 
by New Zealand.  Australia also considers that th ere is no live dispute regarding the requirement for 
involvement of Australian Quarantine and Insp ection Service officers in inspections, because 
New Zealand's challenge results from a misundersta nding of the actual requirement.  Accordingly, 
there are only 15 measures at issue in this dispute.  In addition, a large nu mber of the "measures" WT/DS367/R 
Page 112  
 
 identified by New Zealand are not challengeable on an individual basis, and should only be assessed 
by the Panel when "taken as a whole" with the prin cipal risk reduction measures applied by Australia. 
4.249  Australia also draws the Panel's attention to the critical threshold issue of standard of review.  
The Panel should be mindful of the appropriate standa rd(s) of review in its evaluation of the basis for 
Australia's measures.  The nature of what is requi red of a panel to conduct an "objective assessment of 
the facts" pursuant to Article 11 of the DSU varies depending on the particular provision at issue.  
Under the SPS Agreement, Australia submits that a panel's jurisdictional competence is most limited 
in respect of its review of risk assessments, b ecause the obligation to base SPS measures on a risk 
assessment means that a thorough expert evaluation of the relevant technical issues compulsorily 
precedes a panel's analysis of the issues. 
4.250  In Australia's view, Article 5.1 requires a panel to examine whether the risk assessment relied 
upon by a Member is objective and credible.  Guidan ce from past cases indicates that a panel may not 
conduct its own risk assessment, atte mpt to settle a scientific debate or substitute its own judgment for 
that contained in a risk assessment, without appropr iate cause.  Australia submits that, only if the 
complainant establishes flaws in a risk assessment which are so serious that they would prevent a 
panel from having reasonable confidence in that asse ssment will the panel's duty extend to scrutiny of 
the relevant scientific evidence and intervention in the findings or conclusions of a risk assessment. 
4.251  In addition, the nature of the relationship between Article 2.2 and Article 5.1 of the 
SPS Agreement warrants careful consideration by the Panel.  The Appellate Body has explained that 
these two provisions should constantly be read toge ther and that the elements of each inform and 
impart meaning to the other.  New Zealand effec tively ignores this guidance by artificially dividing 
the substantive matters to be addressed under the two provisions. 
4.252  In Australia's view, the obligation that SPS me asures not be maintained without sufficient 
scientific evidence (Article 2.2) and the obliga tion to base measures on a valid risk assessment 
(Article 5.1) cannot be meaningfully separated.  Ar ticle 5.1 is a specific application of Article 2.2.  
This means that Article 5.1 and its associated provi sions elaborate specific conditions which, if met, 
will establish the consistency of the re levant measures with Article 2.2. 
4.253  Australia's view is supported by the text of  the SPS Agreement.  Both Article 2.2 and 
Article 5.1 are concerned with whether the av ailable evidence supports the establishment of risk, 
which provides an underlying justification for the adoption of SPS measures.  Risk assessments under 
Article 5.1 involve the expert evaluation of scien tific evidence, as well as technical and economic 
factors, in accordance with an appropriate methodol ogy.  They must also be appropriate to the 
circumstances.  Accordingly, if  measures are based on a valid risk assessment under Article 5.1, the 
requirement of Article 2.2 that measures not be maintained without suffici ent scientific evidence is 
satisfied.  Australia has therefore addressed New Z ealand's technical and scientific claims together 
under Article 5.1 and encourages the Panel to similarl y commence its analysis of Australia's measures 
under Article 5.1. 
(c) Legal and factual rebuttal 
(i) Australia's measures are consistent with Artic le 5.1, and accordingl y, with Article 2.2 
New Zealand misunderstands what is  required of a valid risk assessment
 
4.254  Australia's measures are consistent with Article 5.1 and, accordingly, w ith Article 2.2 of the 
SPS Agreement.  They are based on a comprehensive risk assessment, which is appropriate to the 
circumstances and is consistent with the criteria set out in Articles 5.1, 5.2, 5.3 and Annex A(4) of the 
SPS Agreement.  The Final IRA Report expresses the c onclusions of qualified and respected scientists  WT/DS367/R 
 Page 113 
 
 
 and technical experts (the IRA Team).  The IRA T eam concluded on the basis of available evidence 
that, in order to meet Australia's ALOP, measures would be necessary to protect plant life and health 
from fire blight, European canker and ALCM, as well  as a range of measures for other pests that are 
not the subject of dispute by New Zealand. 
4.255  New Zealand misunderstands the nature of th e risk assessment required by Article 5.1. 
4.256  For example, New Zealand argues that, instead of obtaining a proper risk assessment 
appropriate to the circumstances, Australia should have based its measures on the findings in the 
Japan – Apples dispute.  However, the findings in Japan – Apples  clearly do not constitute a risk 
assessment within the meaning of the SPS Agreemen t.  Those findings do not take account of 
Australian conditions including its ALOP, consum ption and distribution patterns, environmental 
conditions, host distributions or the potential comm ercial volume of New Zealand apples which may 
be exported to Australia.  Australia does not accept that the panels in Japan – Apples  envisaged that 
their legal  conclusions should be considered a "global"  risk assessment that could be substituted for a 
proper risk assessment applying to an entirely diffe rent set of circumstances.  In any event, Japan – 
Apples  is concerned with risks associated with only one of  the three pests at issue in this dispute – fire 
blight. 
4.257  New Zealand's criticisms of the IRA Team's anal ysis of the available scientific evidence is 
often based on selective reliance upon particular pi eces of evidence and is also based on multiple 
erroneous calculations and assumptions.  New Zeala nd relies on the superficially attractive notion of 
scientific "certainty" around the transfer and spread of the pests at issue.  This conveniently ignores 
the range of credible scientific views on these issues.  The IRA Team, in exercising its expert 
judgment, was entitled to rely on the full spectru m of scientific evidence drawn from qualified and 
respected sources.  Members regularly take measures to mitigate the potentially significant 
consequences of low probability events.  This is  good risk management practice and does not mean 
that Australia has over-estimated or exaggerated the risks.  It is for Australia to set its own ALOP. 
4.258  The flaws in New Zealand's critique are compounded by errors of law.  Pursuant to the 
relevant provisions of the SPS Agre ement, a valid assessment of phytosanitary risk must evaluate both 
the likelihood  of entry, establishment or spread of a pest, as well as  the associated potential biological 
and economic  consequences .  New Zealand wrongly implies that the notion of "risk" should be 
confined to the likelihood of entry, establishmen t or spread.  New Zealand also inappropriately 
conflates the notion of mere "possibility" with events  that may only have a very small or "negligible" 
probability of occurring.  This effectively amounts to  an assertion that risk assessments are required to 
identify a minimum magnitude of risk – a proposition which has been expressly rejected by the 
Appellate Body. 
4.259  New Zealand also wrongly claims that there are flaws in the semi-quantitative methodology 
used by the IRA Team.  The IRA Team rigorously applied sound methodology, as is scrupulously detailed in the Final IRA Report.  Its approach was commensurate with best practice risk assessments 
worldwide, including the International Plant Prot ection Convention standards (ISPMs).  Furthermore, 
the SPS Agreement is not prescriptive as to methodol ogy and Australia cannot be required to use 
New Zealand's own methodology. 
4.260  The use of distributions by the IRA Team in  estimating probability reflects the range and 
variability of available scientific evidence, accomm odating small but significant probabilities as well 
as uncertainties, consistent with ISPM No.11.  Ne w Zealand's claims that the volume of trade is 
overestimated in the Final IRA Report are based on faulty suppositions a bout Australian consumer 
preferences, distribution channels, price responses and exporter behaviour. WT/DS367/R 
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 New Zealand's claims in respect of fire blight are unsubstantiated
 
4.261  The Final IRA Report outlines in precise detail th e analysis of the IRA Team, which arrived 
at the conclusion that there is an identifiabl e risk that the causal agent of fire blight, 
Erwinia amylovora , could find a pathway into Australia on mature New Zealand apples and result in 
serious consequences.  The findings in Japan – Apples  do not amount to scientific evidence, or a valid 
risk assessment, therefore undermining New Zealand' s claims in this dispute.  New Zealand also 
attempts to substitute the Final IRA Report with the scientific study by Roberts and Sawyer (2008), 
which is based on outdated data largely concerni ng trade between the United States and Japan under 
conditions that are no longer relevant. 
4.262  New Zealand relies on purported evidence about the "long history of trade" between 
exporting countries with fire blight and those countries without the disease, as well as scientific 
studies which speculate about the causes of fire blight  spread, to support its claim that mature apples 
do not spread fire blight.  Australia shows to th e contrary that there is no direct evidence which 
establishes this "fact".  Many fire blight incurs ions around the world remain unexplained.  Members 
other than Australia also share the concern that apple fruit may transmit E. amylovora , evidenced by 
the risk management measures that they impose on imported apples.  Some of New Zealand's other 
trading partners impose measures very similar to t hose adopted by Australia on New Zealand apples.  
New Zealand also argues that the pathway for fire  blight could never be completed because there 
would be insufficient quantities of E. amylovora  bacteria to initiate an infection in Australia.  In 
Australia's view, these arguments are based on an unbalanced and selective view of the evidence. 
4.263  Finally, New Zealand's assertion that the conse quences of a fire blight incursion in Australia 
would be the same as in New Zealand is without b asis.  The Final IRA Report demonstrates that fire 
blight is a highly variable disease a nd is not likely to be experienced  in the same way in different 
places.  In any case, there is ample evidence from New Zealand and the United States to show that fire 
blight disease has very serious consequences. 
New Zealand's claims in respect of European canker are unsubstantiated  
4.264  In respect of European canker, the Final IR A Report outlines in similarly precise detail the 
IRA Team's analysis to arrive at the conclusion that there is an identifiable risk that mature fruit could 
provide a pathway for the entry, establishment a nd spread of the disease, with serious potential 
consequences.  New Zealand seeks to overturn the IRA Team's meticulous approach through a series 
of ill-founded arguments.  However, it cannot esca pe the explicit acknowledgement by the Chief 
Plants Officer of the New Zealand Ministry of Ag riculture that "apple fruit are a potential pathway for 
the introduction of European canker, as the fruit can develop latent or storage rots." 
4.265  Australia shows that New Zealand's climate analysis is too narrow as it focuses solely on a 
few environmental criteria relevant to commercia l apple and pear production, and it overlooks the 
biology of the pathogen and its wide  range of hosts distributed throughout large areas of Australia.  
This leads to incorrect predictions as to the potenti al distribution of European canker.  Australia's 
modelling shows that the potential distribution of Eur opean canker in Australia covers a much larger 
area than that suggested by New Zealand. 
4.266  Contrary to New Zealand's suggestion, the IR A Team identified four relevant studies in 
relation to fruit rot caused by Neonectria galligena  in New Zealand, as well as scientific evidence 
regarding spore dispersal and survival.  Further, Au stralia has clearly articulated the reasons for the 
limited spread during the Tasmanian outbreak of Eu ropean canker.  These reasons include a rigorous 
eradication program and a unique strain of N. galligena  which required another mating type for 
reproduction.  WT/DS367/R 
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 4.267  Finally, New Zealand's claim in relation to  the assessment of potential consequences of 
European canker is superficial and confused. 
New Zealand's claims in respect of ALCM are unsubstantiated  
4.268  The Final IRA Report also represents an obj ective and credible analysis of the risks 
associated with the entry, establis hment or spread of ALCM in Aust ralia associated with New Zealand 
apples.  New Zealand acknowledges that viable ALCM on imported New Zealand apples pose a risk 
for Australia.  But New Zealand fails to appreciat e that the mobility of the insects required the IRA 
Team to adjust its methodology and consider a much  more complex pathway than for fire blight and 
European canker.  New Zealand demonstrates its misunderstanding of the IRA Team's approach to 
assessing unrestricted risk by arguing that the IRA Team should have taken into account the affect of 
risk management measures in its importation an alysis.  Also, New Zealand's reliance upon pieces of 
scientific evidence is highly selective, failing to take into account the range of scientific data 
available. 
4.269  Particularly detrimental to New Zealand's arguments on ALCM is its clear misinterpretation 
of the results of the paper by Rogers et al.  (2006), upon which it relies heavily in respect of the 
proportion of fruit likely to be infested with viable ALCM.  This misinterpretation irredeemably taints 
New Zealand's claims in respect of the probability of entry, establishment and spread of ALCM.  
New Zealand also asserts that most of its apples w ill be exported "retail ready", suggesting that only 
relatively few would require repacking at orchard packing houses, and therefore insufficient quantities 
of infested apples would be situated together near  susceptible hosts.  However, this "retail ready" 
assertion is unsupported by any evidence relevant to th e conditions of the Australian market.  In any 
event, the IRA Team's analysis makes clear that, even if a relatively small proportion of New Zealand 
apples are sent to orchard packing houses, there w ould still be sufficient quantities of infested apples 
for ALCM to establish on the basis of the estimated volume of imported apples. 
4.270  New Zealand's claim that the necessary sequen ce of events to enable ALCM to enter, 
establish and spread in Australia could never occur in the "real world" is undermined by the clearly 
successful spread of ALCM and ot her insect pests across the world. 
4.271  New Zealand's claims in relation to the IRA Team's assessment of potential consequences of 
an ALCM incursion are imprecise and unsubstantiated. 
Conclusion on the risk assessment for fi re blight, European canker and ALCM  
4.272  New Zealand fails to demonstrate any flaws in the Final IRA Report, let alone flaws that are 
"so serious" that they should prevent the Pane l from having reasonable confidence in the risk 
assessment.  In any event, Australia has demonstrat ed that the IRA Team properly evaluated risk and 
applied its expert judgment rigorously to arrive at  an objective assessment in relation to fire blight, 
European canker and ALCM. 
The IRA Team properly evaluated thos e SPS measures which might be applied  
4.273  Australia rejects New Zealand's assertion that the IRA Team failed to evaluate the SPS 
measures which might be applied.  It is clear from the Final IRA Report that each of the principal risk 
reduction measures and alternatives were evaluated for each of the pests at issue.  Australia submits 
that there is no obligation in the SPS Agreement to  evaluate any and every potential measure that 
might be applied to address a particular risk; such  an obligation would be impossible for any Member 
to satisfy. WT/DS367/R 
Page 116  
 
 Conclusion
 
4.274  For the above reasons, Australia submits that th e Final IRA Report is a valid risk assessment 
within the meaning of Article 5.1 and related provi sions of the SPS Agreement.  As New Zealand has 
not challenged whether Australia's measures are "bas ed" on the risk assessment in question, Australia 
submits that its measures are consistent with Artic le 5.1 of the SPS Agreement and, accordingly, with 
the requirement that measures not be maintain ed without sufficient scientific evidence under 
Article 2.2. 
(ii) Australia has acted consis tently with Article 5.2 
4.275  The IRA Team took into account all of the fact ors listed in Article 5.2, including those 
identified by New Zealand:  available scientif ic evidence;  relevant processes and production 
methods;  relevant inspection, sampling and testing me thods;  prevalence of specif ic diseases or pests;  
and relevant ecological and environmental condition .  New Zealand has failed to demonstrate 
otherwise.  Moreover, New Zealand's attempt to conve rt Article 5.2 to an obligation to give "genuine 
consideration" to these factors is not grounded in th e text of the provision and is instead merely a 
complaint that the IRA Team took a different view to New Zealand's own view of these factors. 
(iii) Alternatively, Australia's measures are nonetheless consistent with Article 2.2 
4.276  Australia considers that New Zealand has effec tively abandoned any claims in relation to the 
Article 2.2 requirement that measures be "based on scientific principles". 
4.277  If the Panel does not accept Australia's primary su bmission that consistency with Article 5.1 
establishes consistency under Article 2.2, Australia submits that New Zealand has nevertheless failed 
to establish that Australia's measures are "maint ained without sufficient scientific evidence" in 
violation of Article 2.2.  In any event, Aust ralia has demonstrated that, on the basis of the 
comprehensive analysis of the evidence in the Fi nal IRA Report, there is a rational and objective 
relationship between Australia's m easures and the scientific evidence. 
(iv) Australia's measures are consistent with Article 5.5 and Article 2.3 
4.278  Australia applies its explicitly stated ALOP  consistently, including with respect to 
New Zealand apples and Japanese nashi pears.  New Zealand has failed to establish that Australia 
applies different levels of protec tion under Article 5.5.  New Zealand's simplistic comparison of the 
respective measures  applied in relation to New Zealand a pples and Japanese nashi pears ignores the 
fact that the risks  associated with the two products are mark edly different.  Therefore, the measures 
required to meet Australia's ALOP differ.  Accordin gly, the application of Australia's ALOP does not 
exhibit arbitrary or unjustifiable distinctions in th e treatment of different situations which result in 
discrimination or a disguised restriction on internatio nal trade.  New Zealand has failed to substantiate 
any of the so-called "warning signa ls" and "additional factors" in relation to the third element of 
Article 5.5. 
4.279  As New Zealand fails to estab lish a violation of Article 5.5,  its consequential claims under 
Article 2.3 must also fail. 
(v) Australia's measures are consistent with Article 5.6 
4.280  Australia's measures are not more trade restri ctive than required to achieve its ALOP under 
Article 5.6.  New Zealand's claims under Article 5.6 rest entirely on its contention that the unrestricted 
risks associated with the importation of New Zeala nd apples are lower than the levels established in 
the Final IRA Report; a claim which New Zealand has failed to substantiate.  New Zealand has failed  WT/DS367/R 
 Page 117 
 
 
 to satisfy its burden under Article 5.6 to show that  any of the "alternative" measures identified would 
achieve Australia's ALOP.  Nor, in the case of AL CM, has New Zealand shown that the "alternative" 
measure would be significantly  less trade restrictive.  New Zealand has also failed to identify any 
alternatives to the general measures. 
4.281  Australia considers that New Zealand has abandoned any claim that Australia's measures are 
not "applied only to the extent necessary to prot ect human, animal or plant life or health" under 
Article 2.2. 
(vi) New Zealand's claim under Article 8 and Annex C( 1)(a) is outside the Panel's terms of 
reference 
4.282  New Zealand's claim under Article 8 and Annex C(1)(a) depends on the "IRA process" being 
a measure at issue in this dispute.  In its prelimin ary ruling, the Panel concluded that the scope of this 
dispute is confined to the 17 measures specifically  listed in New Zealand's panel request, which do 
not include the IRA process.  New Zealand's claim that Australia is in breach of Article 8 and Annex C(1)(a) is therefore outside  the scope of this dispute. 
(d) Conclusion 
4.283  For the above reasons, Australia asks the Panel to  find that New Zealand has not established a 
prima facie  case that any of Australia's measures are in consistent with its obligations under the 
SPS Agreement.  Alternatively, if the Panel consid ers New Zealand has estab lished a prima facie case 
in respect of one or more measures, then Australia requests the Panel find that it has rebutted that case 
on the basis of its evidence and legal argument. 
2. Executive summary of Australia's opening oral statement at the first substantive 
meeting 
(a) Introduction 
4.284  This case is about the basic right of all WTO Me mbers to protect plant life and health within 
their territory.  It is about the level of risk that  Australia is prepared to  tolerate and Australia's 
particular quarantine circumstances.  It is about  serious plant pests not present in Australia but 
endemic in New Zealand – fire blight, European can ker and apple leafcurling midge.  It is about the 
comprehensive and transparent science-based risk assessment undertaken by the IRA Team and set 
out in the Final Import Risk Analysis Report for A pples from New Zealand.  It is about Australia's 
reasonable quarantine measures, necessary to mitiga te the risk of serious plant pests entering 
Australia.  It is about the application of scien tific and technical judgment by the qualified and 
respected experts who inform Austra lia's quarantine regulatory decisions.  It is about the extent to 
which a WTO panel is permitted to intervene in such  decisions.  It is about the trade liberalizing 
reality of Australia having opened its market  to New Zealand apples in March 2007. 
4.285  Australia is free of many of the world's major pl ant pests.  Australia's unique biodiversity and 
distinctive native flora and fauna are of world renown.   In addition, Australia's  favourable plant-health 
status is vital to its multi-billion dollar agricultura l sector.  In order to protect these significant assets, 
Australia invests heavily in quaran tine.  As a result, Australia has one of the most comprehensive and 
effective quarantine systems in the world. 
4.286  As recognized in the SPS Agreement, Australia ha s the right to maintain its favourable plant 
health status.  In this regard, Australia is not ask ing to be treated differently to other WTO Members 
when it urges the Panel to pay close attention to Au stralia's particular quarantine circumstances.  In 
order to maintain its favourable plant-health status, Australia must  be able to rely on the WTO bargain WT/DS367/R 
Page 118  
 
 that it signed up for – including  the delicate and carefully negotiate d balance of rights and obligations 
set out in the SPS Agreement.  In undertaking its ro le in this dispute, the Panel should respect this 
delicate balance. 
(b) Australia's appropriate leve l of protection in action 
4.287  The SPS Agreement does not require internati onal harmonization of Members' quarantine 
measures.  In fact, the determination of a Memb er's acceptable level of risk, also known as the 
appropriate level of protection, is the Member's  sole prerogative.  No-one may impinge on that 
prerogative – not trading partners, not WTO panels, not the Appellate Body.  This position has been 
clearly articulated by the Appellate Body
628, and is widely accepted by the WTO membership.629  To 
deny a Member's sovereign right to determine its own appropriate level of protection would disregard 
the balance of rights and obligations set out in the SPS Agreement. 
4.288  Whether other Members may be content to tole rate the risk of an event occurring once in 
every five years or five thousand years, is irre levant.  The SPS Agreement does not require Members 
to accept the same level of risk or a certain minimum level of risk .  It is entirely up to each Member to 
judge whether its national interest is best served by a higher or lower appropriate level of protection.  
What matters in the present case is the risk that Australia is prepared to tolerate , not the risk that 
New Zealand or any other Member is prepared to tolerate. 
4.289  The Australian community demands that its Gove rnment takes responsible action to protect 
Australia's agricultural sector and biodiversity from e xotic pests, and Australia's appropriate level of 
protection is set to reflect this.  It explicitly an d transparently expressed as requiring quarantine risks 
to be managed to a very low level, although not to zero. 
4.290  The concept of appropriate level of protection cannot be seen in isolation.  The appropriate 
level of protection is integral to each Member's  quarantine system.  In order to implement their 
appropriate level of protection, Members have a basic right under the SPS Agreement to take SPS 
measures for the protection of human, animal and plant life or health.  The appropriate level of 
protection is the benchmark, and the SPS measures are the instrument used to achieve that benchmark. 
4.291  A Member's appropriate level of protecti on fundamentally shapes its decision on SPS 
measures.  The first step is to determine the level of  unrestricted risk posed by the product at issue.  If 
that risk is higher than the Member's acceptable le vel of risk, then the Member may adopt measures to 
achieve its appropriate level of protection. 
(c) The Final IRA Report provides the basis for Australia's measures 
4.292  The relevant level of risk posed to Australia  by the importation of apples from New Zealand 
was rigorously examined in the Final IRA Report .  This document provides the basis for the SPS 
measures central to this dispute and cannot be ig nored.  The risk assessment conducted by the IRA 
Team, as set out in the Final IRA Report, is  fully consistent with the SPS Agreement  and with 
internationally recognized scientific method. 
4.293  New Zealand is critical of the Final IRA Repor t and the measures applied by Australia to 
New Zealand's apple exports.  This flows from a broa d argument that there is a single correct view of 
                                                      
628 Appellate Body Report on Australia – Salmon , para. 199. 
629 See for example:  Chinese Taipei's Third Party submission, para. 20;  Chile's Third Party 
submission, para. 8;  European Communities' Third Party submission, paras. 31 and 61;  and United States' 
Third Party submission, paras. 78-79.  WT/DS367/R 
 Page 119 
 
 
 science;  that for there to be two opposing views in any scientific disagreement means that one of 
those views must necessarily be wrong.  This is simply not the case. 
4.294  In this dispute, New Zealand relies on the superficially attractive notion of scientific 
"certainty" around the transfer and spread of the pests at issue.  The reality is that there are different 
views on many scientific issues based on the same set of facts, often held by equally qualified and 
respected scientists.  Moreover, the state of scien tific knowledge is limited and constantly evolving. 
4.295  In this dispute, the Panel is faced with competing scientific opinion and evidence, and 
Australia asks that the Panel bear in mind the A ppellate Body's statemen t that responsible and 
representative governments may act in good faith on th e basis of so-called "divergent" scientific 
opinion, coming from qualified and respected sources.630  In other words, there is no need for the 
Panel to try to choose what it considers the "correct" view to be.  To do so would constitute an error 
of law. 
4.296  The Final IRA Report takes into account some  thousand scientific references, including 
scientific references cited by New Zealand in its written submission.  This literature needs to be 
interpreted in light of Australia's particular circumstances.  The IRA Team, a group of highly 
qualified and respected scientists and t echnical experts, performed this role. 
4.297  The IRA Team applied its expert judgment and el aborated its reasoning at every step in the 
Final IRA Report.  On the basis of its detailed an alysis of the level of risk associated with the 
importation of New Zealand apples, the IRA Team concluded that certain risk mitigation measures 
were required in order to achieve Australia's appropr iate level of protection.  New Zealand can export 
apples to Australia, provided that it observes the reasonable measures recommended in the Final IRA 
Report. 
(d) This dispute is not a re-run of Japan – Apples  
4.298  It is clear that New Zealand believes that this dispute is simply a re-run of Japan – Apples .  
New Zealand continues to treat Japan – Apples  as some form of scientific process, not a legal process.  
This is a major error by New Zealand, a fact th at Third Parties in this dispute have recognized.631  
Japan – Apples is not a risk assessment and is not scientific  evidence.  Moreover, there are significant 
differences between the two sets of circumstances, in cluding the pests at issue, appropriate level of 
protection, climatic conditions, potential host plants, and the volume and mode of trade. 
(e) The product and measures at issue must be identified clearly 
4.299  The product at issue in this dispute, as set out in the Final IRA Report, is "mature apple fruit 
free of trash, either packed or sorted  and graded bulk fruit from New Zealand."632  Any attempt by 
New Zealand to characterise th e product at issue as "mature symptomless  apples" must be dismissed.  
"Symptomless" apples are not necessarily hazard-free. 
4.300  The measures at issue also define the scope of this dispute and warrant careful consideration 
by the Panel.  In the Panel's preliminary ruling of 6 June 2008633, the Panel clearly limited its terms of 
reference to the 17 measures specifically identified in  New Zealand's panel request.  The onus is on 
New Zealand to establish that each measure meets th e definition of an "SPS measure", as set out in 
                                                      
630 Appellate Body Report on EC – Hormones , para. 194. 
631 Chile's Third Party submission, paras. 11-13;  Japan's Third Party submission, para. 2;  European 
Communities' Third Party submission, para. 47;  an d United States' Third Party submission, para. 11. 
632 Australia's IRA, Part B, p. 9. 
633 Australia – Apples , Communication from the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, para. 13(b). WT/DS367/R 
Page 120  
 
 Annex A(1) of the SPS Agreement.  In any event, as explained in Australia's written submission, two 
of these 17 measures are not live issues in this dispute. 
4.301  Not all of the measures can be challenged individually, as several are ancillary measures 
which support, verify and operationalise the principa l risk reduction measures.  In Australia's view, 
the Panel should only examine such  ancillary measures when "taken as a whole" with the principal 
risk reduction measures to which they relate. 
4.302  On this, Australia notes that New Zealand's ch allenge does not cover the whole of the Final 
IRA Report.  The Final IRA Report covers pests and diseases which are not at issue in this dispute, and this needs to be borne in mind, particul arly when examining the ancillary measures. 
(f) New Zealand has not backed up its claims with evidence and legal argument 
4.303  New Zealand bears the burden of raising a prim a facie case of inconsistency in relation to 
each of the provisions it is challenging under the SPS Agreement.  To do this, New Zealand must 
present sufficient evidence and legal argument to support that prima facie case.  Only if New Zealand 
succeeds in doing so must Australia rebut the alleged inconsistencies.  Until that point, Australia is 
entitled to the presumption of WTO-consistency.  Australia emphasises this point because it believes 
that the assertions made by New Zealand in its fi rst written submission are simply not supported by 
legal argument or evidence.  Neither the Panel, nor the Third Parties, are permitted to "make the case" 
for New Zealand. 
4.304  New Zealand is required to discharge its burden of proof in relation to each  of the measures at 
issue under each  of the challenged provisions of the SPS Agre ement.  Australia is firmly of the view 
that New Zealand's case is fatally flawed as it has failed to meet its burden of proof.  Australia 
nonetheless demonstrates, through solid scientific ev idence and legal argument, that the measures at 
issue are fully consistent with the SPS Agreement. 
(g) The Panel's role in this dispute is not unfettered 
4.305  Another critical threshold issue relates to the role  that the Panel is required to perform in this 
dispute.  The Panel's role is not unfettered.  Rath er, there are parameters w ithin which the Panel must 
operate, which are imposed in the standard of review to be applied by the Panel.  The Appellate Body 
has stated that a failure to apply the proper  standard of review constitutes a legal error.
634  Australia 
therefore considers it essential that  the Panel apply the appropriate st andard of review throughout this 
dispute. 
4.306  Contrary to what New Zealand has suggested, the final word on standard of review is not 
Article 11 of the Dispute Settlement Understanding.  While the "objective assessment" standard under 
Article 11 is certainly the starting point for the Pa nel's standard of review, it nevertheless provides 
limited guidance on the precise nature and intensity of the review required by panels in their fact-
finding role.  Accordingly, as indicated by the Appe llate Body, the appropriate  standard of review 
must also be informed by the particular covered ag reement and, within that agreement, the particular 
obligation at issue.635 
4.307  Upon signing up to the WTO bargain, Members co nsciously conceded their jurisdiction on 
certain issues to the WTO, effectively nominating the WTO as arbiter of those issues.  However, on 
other issues, Members' jurisdictional competences we re deliberately retained.  The effect of this 
delicate and carefully negotiated balance is that there is a line that traces its way through the 
                                                      
634 Appellate Body Report on US – Countervailing Duty Investigation on DRAMS,  para. 187. 
635 Appellate Body Report on US – Softwood Lumber VI (Article 21.5 – Canada) , para. 92.  WT/DS367/R 
 Page 121 
 
 
 SPS Agreement – on one side lies the areas of juri sdictional competence that Members conceded, on 
the other side, the areas they did not. 
4.308  The Panel should observe that line.  In the c ontext of the SPS Agreement, the Appellate Body 
has explicitly stated that the standard of review  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."636 
4.309  The standard of review has important implications  for this dispute.  It means that the Panel 
should not conduct its own risk assessment for Aust ralia.  A WTO panel should not attempt to choose 
its preferred view of the science and thereby substit ute its judgment for that of the risk assessor – in 
this case, the IRA Team. 
4.310  Australia is not suggesting that the Panel's role in this dispute is marginal.  Rather, the Panel 
has the centrally important role of determining wh ether Australia's measures are based on a valid risk 
assessment in accordance w ith the relevant provisions of the SPS Agreement; of determining whether 
that risk assessment is objective and credible. 
4.311  Australia submits that the Pa nel should be guided by the co mpliance panel's approach in 
Australia – Salmon (Article 21.5 – Canada) .  The Panel must be satisfied that it has reasonable 
confidence in the risk assessment, and only if Ne w Zealand establishes flaws in the Final IRA Report 
which are so serious  that they would prevent the Panel from having that confidence, should the Panel 
be required to intervene in the findings or conclusions of the Final IRA Report.637 
4.312  Australia notes that the European Communities "l argely agrees" with Australia's position on 
standard of review.638 
(h) New Zealand disregards the special re lationship between Articles 5.1 and 2.2 
4.313  A further important issue in this dispute is th e nature of the relationship between Articles 5.1 
and 2.2 of the SPS Agreement.  Australia believes th at New Zealand's approach to these provisions is 
confused and incorrect. 
4.314  According to the Appellate Body, Articles 5.1 and 2.2 should "constantly be read together", as 
the elements of each provision inform and impart meaning to the other.639  In fact, the Appellate Body 
has indicated that Article 5.1 is a specific application of Article 2.2640, meaning that Article 5.1, and 
its associated provisions, elaborate specific conditions  which, if met, will establish the consistency of 
the relevant measures with Article 2.2. 
4.315  Australia's view of the relationship between Article s 5.1 and 2.2 is firmly grounded in the text 
of the SPS Agreement.  Both Articles concern whether the available evidence demonstrates the 
existence of risk.  That risk provides the basis for the adoption of SPS measures. 
4.316  New Zealand has effectively ignored the clear a nd consistent guidance of the Appellate Body 
by treating Articles 5.1 and 2.2 in virtual isolati on from each other.  New Zealand has neglected to 
illuminate how it considers the two pr ovisions relate to each other. 
                                                      
636 Appellate Body Report on EC – Hormones  para. 115. 
637 Panel Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.57. 
638 European Communities' Third Party submission, para. 28-30, 84. 
639 Appellate Body Report on EC – Hormones , para. 180;  Appellate Body Report on Australia – 
Salmon , para. 130;  Appellate Body Report on Japan – Agricultural Products II , para. 82. 
640 Appellate Body Report on EC – Hormones,  para. 180. WT/DS367/R 
Page 122  
 
 4.317  Risk assessments involve the expert evalua tion of scientific evidence and technical and 
economic factors, in accordance with an appropriate methodology.  They must also be appropriate to 
the circumstances.  Accordingly, if measures are based on a valid risk assessment under Article 5.1, 
the Article 2.2 requirement that measures not be ma intained without sufficien t scientific evidence is 
satisfied.  As acknowledged by the Appellate Body, Article 5.1 marks out and elaborates a particular 
route leading to the same destination set out in Article 2.2.
641 
4.318  Australia notes that the Europ ean Communities agrees that the question of whether Australia 
has maintained measures "without sufficient sci entific evidence" under Article 2.2 can only be 
answered by considering whether Australia's me asures are based on a valid risk assessment under 
Article 5.1.642 
4.319  In light of the special legal re lationship between Articles 5.1 and 2.2, and the fact that the 
Final IRA Report provides the basis for the measures at issue, Australia urges the Panel in this dispute 
to commence its assessme nt of New Zealand's technical and scie ntific arguments under Article 5.1 in 
this dispute. 
(i) Consequences are an integral part of risk assessment 
4.320  New Zealand wrongly implies that the notion of "r isk" should be confined to the likelihood of 
entry, establishment or spread.  However, pursuant to the relevant provisions of the SPS Agreement, a 
valid assessment of phytosanitary risk must evaluate both likelihood , as well as  the associated 
potential biological and economic  consequences .  New Zealand cannot paper over the inconvenient 
truth that the pests at issue in this dispute – fire  blight, European canker and apple leafcurling midge – 
all have serious biological and economic consequences. 
(j) Australia's measures address real probabilities 
4.321  New Zealand also confuses the notion of mere "pos sibility" or "theoretical risk" with events 
that have a very small or "negligible" probabilit y of occurring.  This effectively amounts to an 
assertion that risk assessments are required to iden tify a minimum magnitude of risk – a proposition 
which has been expressly rejected by the Appellate Body. 
4.322  The careful use of statistical distributions by  the IRA Team in estimating probability reflects 
the range and variability of available scientific  evidence, accommodating small but significant 
probabilities as well as uncertainties, consistent with th e relevant international standard for pest risk 
analysis, the ISPM No. 11. 
(k) New Zealand's and the United States' scientific and technical arguments lack merit 
4.323  Australia's first written submission comprehens ively rebuts New Zealand's scientific and 
technical arguments and clearly demonstrates that the Final IRA Report is a valid risk assessment 
under Article 5.1.  As such, Austra lia's measures are consistent with Article 5.1, and, accordingly with 
Article 2.2 of the SPS Agreement. 
4.324  Australia notes that the United States has lodged a lengthy submission with a heavy focus on 
scientific and technical evidence in relation to fi re blight and European canker.  Australia will 
vigorously and comprehensively rebut the serious flaw s in the arguments raised by the United States 
in its rebuttal submission. 
                                                      
641 Appellate Body Report on Australia – Salmon , paras 137-138. 
642 European Communities' Third Party submission, para. 13.  WT/DS367/R 
 Page 123 
 
 
 (l) New Zealand's secondary claims are flawed 
4.325  In addition to its primary claims under Articles 5.1 and 2.2, New Zealand's first written 
submission sets out a number of secondary claims relating to Articles 2.3, 5.2, 5.5 and 5.6 of the SPS Agreement.  Australia has already comprehe nsively addressed these claims in its written 
submission and notes that a number of the Third Parties also question the validity of New Zealand's 
claims. 
(m) New Zealand's undue delay claim is out side the scope of this dispute 
4.326  The Panel has asked the Parties to address Aust ralia's request for a ruling in relation to 
New Zealand's claim of undue delay under Article  8 and Annex C(1)(a) of the SPS Agreement.  
Australia's position is clear.  The Panel issued a pre liminary ruling on 6 June 2008, in which it made it 
very clear that New Zealand's panel request is limi ted to the items specified by bullet point in that 
panel request.
643  All other matters are therefore outside the scope of this dispute. 
4.327  Despite the Panel's preliminary ruling, New Zeal and has proceeded with a claim that the IRA 
process  was subject to undue delay.  Australia considers that this is legally untenable.  It is clear from 
New Zealand's panel request, and the Panel's preliminary ruling, that the IRA process is not a measure 
at issue in this dispute;  the IRA process is not one of the items specified by bullet point in 
New Zealand's panel request. 
4.328  Australia therefore wrote to the Panel on 22 August 2008 asking it to apply its preliminary 
ruling of 6 June by making a further ruling explicitl y stating that New Zealand's undue delay claim is 
outside the scope of these proceedings. 
4.329  Australia notes that paragraph 16 of the Pane l's Working Procedures clearly allows for a 
jurisdictional ruling at any stage of the proceed ings upon the showing of good cause.  Australia 
believes that there is very good cause for a ruling  at this stage of proceedings, as the respondent 
should not be required to defend clai ms which the Panel has indicated ar e not within its jurisdiction.  
In any event, Australia is not seeking a ruling on a ne w issue;  Australia is merely asking the Panel to 
apply its preliminary ruling of 6 June. 
4.330  This is a complex dispute involving detailed legal argument and voluminous scientific and 
technical evidence.  It concerns three pests - bacterial, fungal and insect – each with quite different 
biology.  The Panel, the Parties and the Secretariat all have limited resources, and there is no need to 
expend those limited resources on a moot point.  Aust ralia believes that a ruling at this stage would 
help secure a positive solution to the dispute. 
(n) The Panel may take into account am icus curiae submissions as necessary 
4.331  Australia does not see amicus curiae submissions as having the same status as party or third 
party submissions.  However, they may provide a u seful perspective on issues under consideration in 
this dispute.  Accordingly, the Panel should acce pt amicus curiae submissions into the record.  
Beyond that, it is up to the Panel whether or not to take such submissions into account in resolving the 
issues raised in this dispute. 
                                                      
643 Australia – Apples , Communication from the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, para. 13(b). WT/DS367/R 
Page 124  
 
 (o) Australia is ready to provide its views on the role of experts 
4.332  Australia notes that the Panel may decide to consult experts in relation to scientific and 
technical issues in this dispute.
644  If the Panel chooses to do so, Australia emphasises that, in its view, 
the selection of such experts requires careful deliber ation, and their role requires demarcation from the 
outset. 
(p) Conclusion 
4.333  Australia is an active Member which takes its WTO obligations seriously.  Australia is not 
seeking to resile from the disciplines contained in th e SPS Agreement.  On the contrary, Australia has 
opened its market to New Zealand apples subject to reasonable risk mitigation measures set out in the 
science-based Final IRA Report.  These measures are directed at protecting plant life and health 
within Australia from serious pests not present in  Australia but endemic in New Zealand.  The 
measures are fully WTO-consistent and are require d to achieve Australia's appropriate level of 
protection. 
3. Australia's closing oral statement at the first substantive meeting 
(a) Introduction 
4.334  Australia thanks the Panel for its  questions during this hearing. 
4.335  In Australia's view, the statements of the Parti es and their answers to questions during the first 
substantive meeting have evidenced the complexity  of the legal, scientific and technical issues 
involved in this dispute.  Australia has sought to  respond directly and substantively to the Panel's 
questions to assist the Panel in dealing with this co mplexity.  In particular, Dr Roberts has provided a 
direct account of key aspects of the IRA Team's work. 
4.336  Contrary to New Zealand's assertions, Australia is not seeking to avoid scrutiny of its 
comprehensive and transparent Final IRA Report a nd the reasonable risk reduction measures required 
for New Zealand apples.  Nor is Australia seeking to  rewrite the SPS Agreement or indeed the DSU.  
Rather, drawing on Appellate Body guidance, Austra lia has advanced reasoned interpretations of its 
obligations under the SPS Agreement  that can be applied practically by the Panel to the circumstances 
of this dispute. 
4.337  During this hearing, New Zealand made a numbe r of legal and factual assertions, many of 
which Australia has not previously heard or had th e opportunity to address.  Accordingly, Australia 
will take this opportunity to touch on some of those assertions.  Australia will, of course, 
comprehensively address all of the arguments presented in New Zealand's opening statement in its rebuttal submission. 
(b) The product at issue is clear 
4.338  As has been further reinforced this afte rnoon, New Zealand seeks to run a dual-track 
argument on product at issue.  On the one hand, New Zealand asserts that the product at issue is apples imported from New Zealand into Australia.  On  the other hand, New Zealand asserts that, "in 
practice", it would only export mature symptomless  apples.  Clearly, despite New Zealand's 
equivocation on the matter, there can only be one product at issue in this dispute. 
                                                     
 
644 Article 11.2 of the SPS Agreement and Article 13.2 of the DSU.  WT/DS367/R 
 Page 125 
 
 
 4.339  In principle, Australia agrees with New Zealand's assertion in paragraph 23 of its opening 
statement that the "product at issue is determined by the terms of reference of the Panel".  These terms 
of reference are defined by New Zealand's panel re quest.  The first paragraph of that panel request 
clearly indicates that the importation of apples from New Zealand can be permitted subject to the application of measures as specified in the Final IR A Report.  Page 9 of the Final IRA Report defines 
its scope as "mature apple fruit free of trash, either  packed or sorted and graded bulk fruit from 
New Zealand."  Logic therefore dictates that this  definition establishes the product at issue in this 
dispute.  It also follows that any variation to the product at issue would require the IRA Team to conduct a new risk assessment. 
(c) There is a sound basis for the distinction between principal and ancillary measures 
4.340  Australia has noted the Panel's interest in th e distinction between principal and ancillary 
measures.  Australia has undertaken to provide furthe r elaboration in writing.  The distinction is based 
on the definition of "SPS measure" in Annex A(1) of the SPS Agreement , and the reasoning of the 
panel in the US – Export Restraints dispute.  Contrary to New Zeal and's assertions in its opening 
statement, the issue of whether a measure can indivi dually give rise to a violation of WTO obligations 
was discussed at a general level in US – Export Restraints .  The relevance of that panel's reasoning in 
that dispute is accordingly not limited to the Agreement on Subsidies and Countervailing Measures 
(SCM Agreement). 
4.341  According to Annex A(1), an "SPS" measure is  defined as "any measure applied to protect 
against" certain categories of risk.  In Australia's view, a measure that aims to protect against risks 
must aim to reduce those risks in some concrete wa y.  If a measure does not protect against risks, or 
reduce those risks by itself, then it cannot fall within the definition of "SPS measure". 
4.342  Australia's contention is supported by the releva nt international standards for phytosanitary 
measures.  Ancillary verification measures are broa dly used in international quarantine arrangements 
to ensure that primary risk reductions measures are properly applied.  Au stralia understands that 
New Zealand itself requires that ancillary measures be  met as part of its own quarantine risk reduction 
measures. 
(d) The appropriate standard of review in this dispute 
4.343  Australia recalls that the Panel asked a number of questions in relation to the standard of 
review under the SPS Agreement.  While Australia w ill elaborate on this subject further in writing, it 
would take this opportunity to re mind the Panel of the critical point made in Australia's own opening 
statement. 
4.344  In this dispute, the standard of review re flects the balance of jurisdictional competences 
between Members and the WTO established in the SPS Agreement.  As Australia explained in 
response to questions from the Panel,  the standard of review must be considered in light of the 
specific obligations at issue, a notion exp licitly recognized by the Appellate Body.
645 
4.345  In its questions, the Panel asked Parties whether they considered that a specific standard of 
review applied to disputes under the SPS Agreement, gi ven the lack of an explicit standard of review 
set out in that Agreement.  The Panel contrasted this  to the existence of the specific standard of review 
set out in Article 17.6 of the Anti-Dumping Agreement. 
4.346  Australia notes that the lack of an explicit sta ndard of review under ot her covered agreements 
has not prevented panels and the Appellate Body from applying a specific standard of review in 
                                                      
645 Appellate Body Report on US – Softwood Lumber VI (Article 21.5 – Canada) , para. 92. WT/DS367/R 
Page 126  
 
 disputes relating to covered agreements other than  the Anti-Dumping Agreement.  For example, the 
standard of review has been a significant i ssue in both safeguards disputes and under the 
SCM Agreement.  More particularly, in EC – Hormones,  the Appellate Body clearly recognized that 
panels must "adopt a standard of review… clearly rooted in the text of the SPS Agreement itself".
646 
4.347  Accordingly, in Australia's view, the absence of an express provision in the SPS Agreement 
addressing standard of review does not mean that there is not a carefully delimited division of 
competences between Members and the WTO which mu st be reflected in the standard of review 
applied by the Panel. 
4.348  For example, in relation to Article 5.1, unless New Zealand can demonstrate flaws so serious 
that the Panel cannot have reasonable confidence in the assessment of risk in the Final IRA Report, 
the Panel must not substitute its own assessment for that of the IRA Team. 
(e) Australia may rely on divergent scientific opinion 
4.349  New Zealand's opening statement illustrates its continued discomfort with the Appellate 
Body's express recognition that Members are entitled to rely on "divergent" scientific opinion from 
qualified and respected sources.  In understanding th e Appellate Body's guidance, it is important to 
recognize that scientific evidence does not exist in a vacuum;  it does not have an autonomous reality.  
In the context of the quarantine regulatory system , scientific evidence needs to be interpreted by 
experts and applied to the specific circumstances of the importing Member.  This is the role that was 
undertaken by the IRA Team. 
4.350  By way of example, New Zealand claims that divergent scientific opinion on fire blight does 
not exist.  However, it is illustrative to examine one of the technical issues raised by New Zealand – 
that of the number of bacteria needed to start an in fection.  The scientific opinion on this issue reflects 
diverging scientific papers that showed variously that  the number of bacteria needed to start infection 
varies from 1 bacterium to around 10,000 bacteria.  This is just one small example of the divergent scientific opinion that was considered in great detail in the Final IRA Report. 
(f) New Zealand's continued reliance on Japan – Apples is misguided 
4.351  Australia recognizes that the Panel has hear d Australia's views on the applicability of Japan – 
Apples to the present dispute.  Australia will not repeat its views, except to note that the United States, 
the complainant in that dispute, takes a more modera te approach than New Zealand to this issue.  In 
fact, Australia notes that the United States did not mention the Japan – Apples dispute in its statement 
at the meeting with the Panel. 
(g) Likelihood combined with consequences equals risk 
4.352  New Zealand alleges that Australia is trying to shift the emphasis of risk assessment from 
likelihood to consequences.  This is  simply untrue.  As explained dur ing the first substantive meeting, 
Australia's risk estimation matrix takes full acc ount of both elements of risk:  likelihood and 
consequences.  Australia's matrix is firmly gr ounded on the definition of risk assessment in 
Annex A(4) of the SPS Agreement. 
(h) Articles 5.1 and 2.2 exist in a special legal relationship 
4.353  Turning to the relationship between Article 2.2 and Article 5.1, Australia wishes to correct 
some significant errors in New Zealand's a ttempted critique of Australia's arguments. 
                                                     
 
646 Appellate Body Report on EC – Hormones , para. 115.  WT/DS367/R 
 Page 127 
 
 
 4.354  New Zealand has misrepresented and mischaracterised Australia's interpretation of Article 2.2 
and Article 5.1.  Contrary to "inverting" the re lationship between the two provisions, or interpreting 
those provisions in a way that deprives Article 2.2 of substance, Australia has sought to provide the 
Panel with a workable, good faith in terpretation of those closely connected provisions, consistent with 
the established guidance of the Appellate Body.  Articl e 2.2 is not an invitation for the Panel to assess 
the validity of the scientific basis of Australia's measures on a basis other than the Final IRA Report. 
4.355  As indicated in Australia's first written submi ssion, Australia's interpretation in relation to 
Articles 5.1 and 2.2 is the one that it considers to be applicable in this case.  It makes no submissions 
about the "correct" approach in all cases. 
4.356  Australia's position is simply this.  In the present case, where the Final IRA Report is both a 
current and comprehensive risk assessment, th e question of whether Australia's measures are 
maintained without sufficient sci entific evidence should be answered by considering whether the 
Final IRA Report is a valid risk assessment. 
(i) Australia has comprehensively rebutted New Zealand's Article 2.2 arguments 
4.357  Australia firmly rejects any suggestion that it has not made a serious attempt to rebut 
New Zealand's arguments in relation to Article 2. 2.  In paragraph 344 of Australia's first written 
submission, Australia notes that there is a subs tantial overlap in New Zealand's technical and 
scientific arguments under Articles 5.1 and 2.2, and that it would therefore address them together.  Australia then proceeds with a 150 page comprehe nsive rebuttal of New Zealand's scientific and 
technical arguments.  In addition, Australia's fi rst written submission also contains a substantive 
alternative argument in relation to Article 2.2.  Accordingly, there is no doubt whatsoever that 
Australia has responded very directly to New Ze aland's arguments in relation to Article 2.2. 
4.358  New Zealand has attempted to reverse the burde n of proof in relation to Article 2.2.  
Australia's position on the burden of proof applicable  to Article 2.2 is based on a straightforward 
application of the customary rules of interpretation of  public international law to that provision.  Put 
simply, the third requirement of Article 2.2 is co uched in negative terms.  Namely, Members must 
ensure that their measures are " not maintained without  sufficient scientific evidence".  The provision 
does not say that Members must ensure that their measures are "maintained with sufficient scientific 
evidence". 
4.359  In Australia's view, the drafters of the SPS Agreement very deliberately chose this 
formulation of words to emphasise that complainants  bear a heavy evidentiary burden in establishing 
a breach of the third requirement of Article 2.2.   It requires the complainant to positively prove 
insufficiency of the scientific evid ence in relation to the measures at issue.  In the context of this 
dispute, this means that New Zealand must positivel y demonstrate that the IRA Team's evaluation of 
the scientific evidence was not  objective and credible. 
(j) Scientific and technical arguments 
4.360  During this hearing, New Zealand has intr oduced a few new scientific and technical 
arguments in relation to European canker and a pple leafcurling midge.  Nothing new has been 
introduced in relation fire blight. 
(i)
 European canker 
4.361  Australia firmly rejects New Zealand's assertion th at it is attempting to re-write the Final IRA 
Report in relation to European canker, or any other p est at issue.  As the respondent in this dispute, 
Australia is clearly entitled to rebut New Zeala nd's claims and arguments in order to defend the WT/DS367/R 
Page 128  
 
 consistency of its measures.  This is not equivale nt to re-writing the Final IRA Report;  it is simply 
usual practice under the WTO dispute settlement system. 
4.362  New Zealand criticises Australia for introducing an  "alternative climate analysis", suggesting 
that this somehow acknowledges the inadequacy of the "original climatic risk assessment" in the Final 
IRA Report.  However, New Zealand fundamen tally misunderstands Australia's position.  
Environmental conditions, including climate, are onl y one of the three key criteria which determine 
disease development.  New Zealand's fixation with c limate analysis ignores the other two key criteria, 
the pathogen and the host.  In contrast, the IRA Team took into account all three criteria in its 
assessment of European canker as demonstrated by th e Final IRA Report.  Moreover, contrary to what 
New Zealand alleges, the climate analysis contained in Annex 2 of Australia's first written submission 
is not directed at patching up the Final IRA Repo rt.  Rather, it was merely introduced to rebut 
New Zealand's climate analysis - in doing so it conf irms the credible and objective analysis set out in 
the Final IRA Report. 
4.363  New Zealand continues to erroneously equate the significant apples trade from Tasmania  with 
insignificant apples trade from the four diseased orchards in Spreyton .  Australia notes New Zealand's 
assertions as to the volume of trade moving out of the Spreyton area during the period of the outbreak, 
and looks forward to receiving the evid ence referred to by New Zealand. 
(ii) Apple leafcurling midge 
4.364  New Zealand claims in its opening statement at paragraph 105 that Australia included AQIS 
inspections at the border as a component of Australia's unrestricted risk analysis in relation to apple leafcurling midge.  This is simply not true.  In this  regard, Australia refers th e Panel to page 23 of the 
Final IRA Report, which states that "possible AQIS on-arrival inspection for quarantine pests 
associated with apples is not considered in the assessment of unrestricted risk". 
4.365  Australia notes that New Zealand has introduced a purported clarification of the Rogers et al 
2006 paper on apple leafcurling midge.  Australia do es not consider that it clarifies how New Zealand 
derives an overall viability rate of 15 per cent fro m that study.  Australia will further address the 
content of the Rogers et al  2006 study, together with Exhibit NZ-102, at a later stage of the 
proceedings.  Suffice to say, New Zealand's assertion with respect to this paper does not impugn the 
IRA Team's assessment of the probability of  importation of apple leafcurling midge. 
(k) The AQIS audit requirement has been misunderstood by New Zealand 
4.366  The AQIS auditing requirement continues to be a contentious issue for New Zealand but, in 
Australia's view, needlessly so.  Despite repeated cl arifications from Australia, both before and during 
these proceedings, New Zealand continues to  misquote and misunderstand the AQIS audit 
requirements.  In practice, Australia expects that  the audit requirements would not be onerous as, 
following normal practice, New Zealand and Australia  would negotiate arrangements for minimising 
duplication and maximising efficiency.  Australia w ill provide further elaboration on this point in 
writing as part of the question and answer process. 
4.367  Australia also points out that its import requirements for apples from New Zealand, including 
the AQIS audit requirements, are subject to review after the first year of trade.
647  Australia applies 
such a review mechanism in relation to all import risk assessments.  Australia highlights US table 
grapes as an example where Australia has adjusted the relevant import requirements a number of times. 
                                                     
 
647 Australia's IRA, Part B, p. 325.  WT/DS367/R 
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 (l) New Zealand's secondary claims  continue to lack merit 
4.368  In addition to its primary claims under Articles 5.1 and 2.2, New Zealand's oral statement 
recycles the arguments made in its first writte n submission regarding its secondary claims under 
Articles 5.2, 5.5 and 5.6 of the SPS Agreement.  Au stralia has already compre hensively rebutted these 
arguments in its first written submission.  Moreove r, a number of the Third Parties have also called 
into question the validity of Ne w Zealand's secondary claims. 
4.369  Australia continues to be of the view that Ne w Zealand has failed to discharge its burden of 
proof by establishing a prima facie case.  In all legal proceedings, including this one, the burden of proof is a critical issue, contrary to what New Zeal and has asserted in its closing statement.  Australia 
reiterates its position that New Zealand cannot be  permitted to introduce new evidence to make a 
prima facie case by way of its rebuttal submission. 
4.370  In its opening statement, New Zealand appears to query whether Australia has acted in good 
faith by reserving its position in relation to New Zealand's claim of undue delay under Article 8 and 
Annex C(1)(a).  New Zealand goes on to allege that , as a consequence, the Panel is entitled to accept 
New Zealand's claim as it has not been challenged by "reasoned argument". 
4.371  This argument is completely devoid of merit.  New Zealand's claim on undue delay has been 
challenged by Australia as being outside the scope of  the Panel's terms of reference.  Australia has 
done so by "reasoned" and compelling argument, in stark to contrast to New Zealand's acrobatics on the issue.  Australia has acted in good faith in doi ng so and reserves further argument until the Panel 
delivers its ruling.  On that point, Australia woul d appreciate an indication from the Panel as to when 
it is likely to rule on this issue. 
(m) Timing of the second hearing 
4.372  Before concluding, Australia would like to flag with the Panel a potential logistical issue with 
respect to the timing of the second panel hearing.   Australia has repeatedly tried to secure 
accommodation for our delegation since it became aware of the timetable.  Unfortunately, Australia's efforts to date have been unsuccessful due to the f act that the Geneva motor show coincides with the 
dates of the second hearing.  Australia will continue  with its search, but foreshadow that if it is 
unsuccessful within the next few weeks, it will write to the Panel to request that the second hearing be 
rescheduled to the nearest available dates.  It is obviously not possible for the Australian delegation to 
travel to Geneva for the second hearing if Australia is unable to secure accommodation. 
(n) Conclusion 
4.373  Australia also notes New Zealand's reference in its closing statement to Australia's IRA 
process being "intermingled" with a political process.  Australia absolutely rejects any inference that 
its science-based IRA process was intermingled with  any political process.  As  noted in Australia's 
written submission, New Zealand has provided no evid ence to back up such inferences and Australia 
has asked the Panel to disregard them completely. 
4.374  In conclusion, there is no question that New Zealand and Australia enjoy a harmonious 
relationship based on shared values, partnership and mutual interest.  The bilateral trade agreement 
between New Zealand and Australia is one of the most comprehensive and successful worldwide.  There is no better basis on which to found a mutually agreeable resolution to this dispute.  Australia 
welcomes the comments the Panel offered in this rega rd, and would like to assure the Panel that it will 
continue to work closely with its neighbour a nd close friend, New Zealand, towards this end. WT/DS367/R 
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 4.375  Australia would like to thank the delegation of New Zealand, the Third Parties, the Panel and 
the Secretariat for the opportunity to  present its case at this hearing. 
4. Executive summary of Australia's second written submission 
(a) Introduction 
4.376  The key issue for the Panel's determination is the validity of Australia's risk assessments for 
fire blight, European canker and ALCM under th e SPS Agreement.  New Zealand has failed to 
demonstrate any serious flaws with those risk assess ments.  Accordingly, the Panel should find that 
the Final IRA Report provides objectively justifiable ri sk assessments for the thr ee pests at issue, and 
that the measures at issue are required to achieve Australia's appropriate le vel of protection (ALOP). 
(b) Overarching legal arguments 
4.377  The Appellate Body's decision in US/Canada – Continued Suspension  provides important 
guidance to the Panel for some of the key issues in  this dispute: in particular, a panel's limited 
mandate when evaluating a risk assessment, as established by its standard of review; the right of Members to rely on "divergent or minority" scientific  opinion; and the appropriate use of experts by 
panels.  Australia's previous submissions on standard  of review are substantially congruent with this 
guidance. 
4.378  New Zealand's disregard for the Panel's limite d mandate and the special relationship between 
Articles 5.1 and 2.2 of the SPS Agreement has cause d it to misjudge the nature of the case it was 
required to advance.  Instead of directing its ch allenge at the Final IRA Report, New Zealand has 
argued that its own interpretation of the available sc ientific evidence is the only "correct" view.  By 
doing so, it has effectively asked the Panel to conduct a de novo  review of the scie ntific and technical 
evidence, an approach which the Appellate Body ha s made clear is impermissible.  New Zealand's 
misjudgement has resulted in it failing to meet its bu rden of proof.  New Zealand may not rely on 
either the Panel or the experts to make its case. 
4.379  In US/Canada – Continued Suspension , the Appellate Body reaffirmed that the scientific 
basis relied upon by a Member in its risk assessment need not reflect the majority view within the 
scientific community, but may reflect "divergent or minority" views.  This recognizes that there may 
be more than one legitimate opini on, from qualified and respected s ources, in situations where the 
available scientific evidence is sufficient to c onduct an objectively justifiable risk assessment. 
4.380  In particular, multiple valid opinions may result where there is scientific uncertainty on a 
particular issue.  In Australia's view, a lack of  comprehensive or definitive evidence on a particular 
point does not render a risk assessment legally invalid.   Data constraints and expert judgment are part 
of the reality of conducting risk assessments in the context of a quarantine regulatory system directed 
at facilitating international trade. 
4.381  The experts appointed by the Panel have a limite d but important role to assist the Panel in 
considering the scientific evidence submitted and th e arguments made by the Parties.  The Panel 
should be mindful not to inadvertently defer its j udgment to the experts on matters which ultimately 
require the Panel to draw legal  conclusions. 
4.382  
New Zealand has failed to show that each of the 16 remaining measures at issue would fall 
within the definition of "SPS measure" in Annex A(1) of the SPS Agreement, when taken alone.  
Australia considers that its distinction between pr incipal and ancillary measures is well-founded, and 
reflects a distinction between those measures which are intended to be active in risk reduction, and 
those which are not.  The Panel may make findings with  respect to all of the measures at issue in this  WT/DS367/R 
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 dispute, but Australia submits that it may only eval uate the "ancillary" measures when taken together 
with related "principal" measures. 
4.383  New Zealand continues to equivocate on the product at issue.  To restrict the scope of the 
Panel's findings to "mature, symptomless apples", as New Zealand would apparen tly have it, would be 
a legal error. 
(c) Specific legal arguments 
4.384  Australia recalls its submission that Articles 5.1 and 2.2 exist in a special relationship, 
whereby Article 5.1 provides a means of achieving the Article 2.2 requirement that SPS measures not 
be "maintained without sufficient scientific eviden ce" where an importing Member relies on a current 
risk assessment.  New Zealand has incorrectly treated Articles 5.1 and 2.2 as sources of distinct 
obligations.  Both the European Communities and the United States support Australia's approach to 
Articles 5.1 and 2.2 in this dispute. 
4.385  New Zealand inappropriately equates scientific un certainty with the notion of "insufficient" 
scientific evidence.  The IPPC has acknowledged that uncertainty is an inherent part of pest risk 
analysis, and Australia submits that it may be va lidly addressed by a risk assessment which satisfies 
the requirements of Article 5.1.  A lack of data  on a particular aspect of a risk pathway does not 
absolve a risk assessor from its duty to conduct an objectively justifiable risk assessment, and 
accordingly may require the exercise of expert judgmen t.  As observed in Firko and Podleckis (2000), 
scientific experiments are seldom conducted specifica lly to provide estimates to be used in risk 
assessments. 
4.386  As none of the pests at issue ar e present in Australia, the Final IRA Report's estimations of 
risk inevitably constitute an extrapolation from avai lable data to a hypothetical situation.  However, 
historical data cannot be determinative when tryi ng to predict how a pest may behave in a new 
environment.  Furthermore, the leve l of risk determined in the Final IRA Report was closely related to 
the projected commercial volume of New Zealand apples that would be imported. 
4.387  New Zealand's claim that Article 5.2 requires Memb ers to give "genuine consideration" to the 
matters listed in that provision is contrary to the customary rules of interpretation of public 
international law.  As Australia has previously not ed, the IRA Team was not obliged to draw the same 
conclusions as New Zealand on the b asis of the evidence available. 
(d) The scientific and technical issues w ith respect to Australia's measures 
4.388  Australia considers that the Final IRA Report sets out objectively justifiable risk assessments 
for fire blight, European canker and ALCM.  The Final IRA Report expresses the reasoning and 
conclusions of qualified and respected scientists an d technical experts on the basis of the evidence 
available, in a manner appropriate to Australia's ci rcumstances.  New Zealand's failure to demonstrate 
any serious flaws with those risk assessments me ans that its arguments have not undermined the 
validity of the Final IRA Report as a basis for the measures at issue. 
(i) New Zealand has not shown that the IRA Team's methodology is flawed 
4.389  Australia has refuted New Zealand's assertions that the semi-quantitative methodology used in 
the Final IRA Report suffered from three "fundamental  flaws".  New Zealand asserted that the Final 
IRA Report used uniform distributions, including the distribution (0, 10-6), to "inflate risk".  In 
attempting to support this assertion, New Zealand re lied heavily on what it describes as "real world 
data" from its trade in apples with other countries.  Th is data is not scientific evidence, and Australia's 
careful analysis demonstrates that New Zealand's reliance on it is misplaced.  New Zealand also WT/DS367/R 
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 asserted that the assessment in the Final IRA Report of the potential volume of trade in apples from 
New Zealand was overestimated.  Australia has sh own this assertion to be based on four faulty 
suppositions. 
(ii) The risk assessment for fire bli ght is objectively justifiable 
4.390  New Zealand's principal claim in respect of fire blight is that there is no scientific evidence 
supporting the proposition that mature a pples provide a pathway for fire b light establishment.  It relies 
on four key bases to substantiate this claim:  Japan – Apples , Roberts and Sawyer (2008), "real world" 
data, and its own interpretation of  selected scientific evidence.  This approach is legally and 
technically flawed. 
4.391  By arguing that each of these four bases confirms the absence of a pathway, New Zealand 
effectively advances alternative accounts of a fire bl ight risk assessment which, in its view, should be 
preferred to the Final IRA Report.  Requesting that  the Panel consider these arguments is tantamount 
to asking the Panel to conduct a legally impermissible de novo  review. 
4.392  New Zealand's key technical arguments are equally flawed.  First, they are based on 
unreliable evidence and are not appropriate to the specific  risk assessed in the Final IRA Report.  The 
findings in the Japan – Apples  dispute do not address the same risk scenario as the Final IRA Report;  
the Roberts and Sawyer (2008) paper relied upon by New Zealand does not consider unrestricted risk 
and, in any event, contains flaws in its data se t;  and the "real world" trade data highlighted by 
New Zealand is not scientific evidence and cannot be  used to draw direct inferences about the disease 
pathway. 
4.393  New Zealand's arguments are also based on a f undamental misunderstanding of the fire blight 
pathway and the requirements of the SPS Agreement.  Completion of the fire blight pathway does not 
require, as New Zealand suggests, that populations of E. amylovora  bacteria remain high throughout 
the entire duration of the entry scenario.  The material point in time when bacterial populations are significant is at the time of infection of a suita ble host.  Further, the SPS Agreement does not 
recognize any a priori  limits on the kind of scientific eviden ce which may be considered in a risk 
assessment, provided that it meets the scientific comm unity's standard of legitimate science.  Thus, 
New Zealand's attempts to exclude laboratory evid ence from review should be rejected.  Laboratory 
studies are a standard scientific method for deve loping an understanding of what may be possible 
under field conditions, and may be the only scientific ev idence available. 
4.394  Finally, New Zealand's critique of the Final IRA Report is superficial and deficient.  
New Zealand has sought to downplay the critical point that it did not provide the IRA Team with any 
evidence demonstrating orchard freedom from E. amylovora  in any apple producing areas.  
New Zealand has overlooked key elements of the IRA Team's reasoning and faile d to appreciate that 
certain conclusions were tailored to the specific circ umstances of this case.  Further, in relation to 
several importation steps, New Zealand has inappropria tely attempted to expand its suite of claims by 
relying on the experts' replies to introduce ar guments it failed to make itself previously.  
New Zealand's arguments on exposure ignore the real  challenges faced by risk  assessors when dealing 
with a lack of data and scientific uncertainty.  Im portantly, New Zealand has failed to show that the 
extremely small probability interval assigned to this step by the IRA Team is not within the potential 
range of objectively justifiable views on the matter. 
4.395  Australia also notes that the fire blight expert s appointed by the Panel support the application 
of risk management measures for fire blight, and confirm the inadequacy of New Zealand's purported 
alternative measure (restricting imports to "mature, symptomless apples") to achieve Australia's 
ALOP.  Such support is fundamentally incompatible  with New Zealand's assertion that there is no 
pathway for fire blight through "mature, symptomless apples".  Further, the experts expressed strong  WT/DS367/R 
 Page 133 
 
 
 support for the assessment of potential conseque nces in the Final IRA Report.  Accordingly, 
New Zealand has failed to demonstrate any serious flaws in the IRA Team's risk assessment for fire 
blight, and the Panel should find it  to be objectively justifiable. 
(iii) The risk assessment for European canker is objectively justifiable 
4.396  New Zealand's case on European canker is legally flawed and as a result it has failed to meet 
its burden of proof.  Australia has refuted New Zeal and's deficient scientific and technical arguments.  
Moreover, the European canker experts appointed by  the Panel acknowledged that there is a risk of 
introducing European canker into Australia associat ed with the importation of latently infected 
New Zealand apples, which was the IRA Team's primary risk scenario. 
4.397  The IRA Team's analysis shows that latent fru it infection with European canker is a widely 
accepted phenomenon in the scientific community and it has been reported in New Zealand.  Both 
experts appointed by the Panel agree that latent fruit infection occasionally occurs in New Zealand.  
New Zealand's attempt to distance itself from its own official report (i.e., Braithwaite (1996)), which 
concludes that latently infected apple fruit are a potential pathway for the introduction of European 
canker, lacks credibility.  The relevant CABI datash eet confirms that fruit is one of the plant parts 
liable to carry the pest in trade/transport.  Furt her, surface-infestation of mature apples occurs in 
New Zealand, in both the field and in processing, a nd such infestation can lead to latent infection. 
4.398  With respect to the potential for European ca nker to establish and spread in Australia, the 
Final IRA Report cites scientific evidence that apples  rotting in the field due to European canker can 
produce spores to act as a source of further infection.  This scenario is accepted by one of the experts 
appointed by the Panel.  Dispersal of spores by "onl y a few metres" is all that would be required for a 
rotting apple in orchard wholesaler waste, or in a backyard compost heap, to transfer N. galligena  to a 
susceptible host.  European canker has a wide range of alternative hosts, many of which are present in 
Australia.  In addition, contrary to New Zealand' s assertions, there are areas of Australia (including 
commercial apple growing regions) that have clim atic conditions which are conducive to European 
canker, as shown by Australia's climate analysis. 
4.399  New Zealand overplays the significance of the 1950s disease outbreak in Spreyton, Tasmania.  
New Zealand erroneously attempts to project the e xperience of this outbreak to the entire Australian 
continent.  Australia also considers that New Zealand has misrepresented what occurred in the 
movement of Spreyton apples during that time. 
4.400  Finally, Australia rejects New Zealand's ongoing  attempt to diminish the consequences of 
European canker.  It is widely accepted around the world that the disease has serious consequences.  
In fact, it is one of only a few pests addressed by the Pipfruit NZ integrated fruit production manual. 
4.401  As New Zealand has failed to identify any seri ous flaws in the IRA Team's risk assessment 
for European canker, the Panel should be sa tisfied that it is objectively justifiable. 
(iv) The risk assessment for ALCM is objectively justifiable 
4.402  In relation to ALCM, New Zealand has failed to demonstrate that there was reliable data 
which was not taken into account by the IRA Team in  respect of the prevalence of viable ALCM on 
New Zealand apples.  The probability values chosen  by the IRA Team aimed to ensure that the 
potential for considerable seasonal and geographic va riation in ALCM-prevalence was accounted for, 
in light of the scant information available on the matter. 
4.403  Furthermore, New Zealand has failed to estab lish that sufficient quantities of apples would 
not be co-located within sufficient proximity to apple host plants so that adult insects could not WT/DS367/R 
Page 134  
 
 emerge and establish in Australia.  New Zealand's cl aim that this would never occur on the basis that 
it would export the majority of its apples in "retail re ady" form is flawed.  First, limiting its exports in 
such a way would be commercially disadvantage ous, and secondly, the apples may nevertheless be 
sent to orchard wholesalers for repackaging or reco nditioning.  In addition, New Zealand's assertion 
that apple waste will not be left uncovered for a sufficient length of time to allow adult ALCM to 
emerge is based on mistaken assumptions relating to waste management in Australia. 
4.404  Australia notes that the ALCM expert appointed by the Panel expressed the view that the IRA 
Team's analysis was objective and coherent on a number of key issues in dispute, including its 
evaluation of the potential consequences of an ALCM  incursion.  Similarly, the ALCM expert opined 
that New Zealand's assertions regarding the time required for adult emergence after removal from 
cold storage and the flight distance of adult fe males were unsupported by the evidence available.  
Finally, the ALCM expert implicitly agreed w ith Australia that a 600-unit inspection alone, as 
proposed by New Zealand, would not achieve Australia's ALOP. 
4.405  Accordingly, New Zealand has failed to establis h any flaws which were so serious that, if 
absent, would have led to a lower level of assigne d risk.  The Panel should accordingly accept that the 
Final IRA Report provides an objectively justifiable risk assessment for ALCM. 
(v) The general measures 
4.406  The general measures at issue are all ancillary re quirements to Australia's principal measures 
for fire blight, European canker and ALCM.  Acco rdingly, the purpose and technical basis of the 
general measures is inextricably linked to that of the principal measures. 
4.407  Australia considers there to be no reason for the Panel or New Zealand to doubt the accuracy 
of Australia's explanation what its requirement concerning "AQIS involvement" in certain procedures 
in New Zealand entails.  Systems auditing will be the extent of the "AQIS involvement".  ISPM 
No. 20 recognizes that auditing of the systems in an exporting country may be required in the development of new trade.  Australia notes that New Zealand has not identified an "alternative" measure to Australia's existing requirement. 
(vi) The IRA Team evaluated likelihood according to the SPS measures which might be applied 
4.408  Australia notes that the IRA Team evaluated a range of potential measures for each of the 
pests at issue, and that the measures recommend ed were limited to those necessary to achieve 
Australia's ALOP.  Australia agre es with the compliance panel in Australia – Salmon (Article 21.5 – 
Canada)  that the rights and obligations concerning th e linkages between a risk assessment and the 
measures selected are not set out under the mere defi nition of "risk assessment" in Annex A(4) of the 
SPS Agreement, but rather in Article 5.1 and Article  5.6.  Australia considers that it is disingenuous 
for New Zealand to complain that the IRA Team fail ed to properly evaluate certain measures when it 
has accepted, by conceding Australia's measures are "based on" the Final IRA Report, that there is an 
adequate relationship between  the Final IRA Report and all of the measures at issue under Article 5.1.  
In addition, New Zealand has failed to raise other alternative measures under Article 5.6. 
(vii) Australia's measures are not inconsistent with Articles 5.1, 5.2, 2.2 and 5.6 
4.409  New Zealand's claims under Articles 5.1, 5.2, 2.2 and 5.6 are interdependent and conditional 
on each other.  As a result, should the Panel fi nd the Final IRA Report to provide valid risk 
assessments within the meaning of the SPS Agreement, it should make consequential findings that all 
of the measures at issue are consistent with each of those provisions.  WT/DS367/R 
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 4.410  New Zealand concedes that Australia's measures are "based on" the Final IRA Report.  
Therefore, to the extent that the Panel finds the risk assessments for the thr ee pests at issue to be 
objectively justifiable, it should find that the measu res at issue are consistent with Article 5.1. 
4.411  Australia's primary submission is that consis tency with Article 5.1 establishes consistency 
with the Article 2.2 requirement that SPS measur es not be "maintained without sufficient scientific 
evidence".  Accordingly, to the exte nt that the Panel finds the measures at issue to be consistent with 
Article 5.1, it should also find them to be consistent  with Article 2.2.  Altern atively, Australia submits 
that New Zealand has nevertheless failed to establish that Australia's measures are inconsistent with 
Article 2.2. 
4.412  Article 5.2 is an obligation directed at the conduct of risk assessments, rather than to the 
consistency of particular measures.  Therefore, a finding that the risk assessments are valid within the 
meaning of the SPS Agreement would also mean that the factors under Article 5.2 were taken into account in the Final IRA Report, New Zeala nd having failed to demonstrate otherwise. 
4.413  In relation to Article 5.6, it is undisputed that the "alternative" measures proposed by 
New Zealand would not achieve the same degree of risk reduction as the measures at issue.  
New Zealand's claims that restricting imports to "mature, symptomless apples" would be sufficient in 
regards to the risks associated w ith fire blight and European canker, and that a 600-unit inspection 
would be sufficient in regards to ALCM rest on its flawed belief that the unrestricted risk for those 
pests meets Australia's ALOP.  Therefore, a findi ng that the Final IRA Report presents valid risk 
assessments means that New Zealand has not iden tified alternative measures which would achieve 
Australia's ALOP.  Accordingly, the Panel should fi nd that Australia's measures are consistent with 
Article 5.6. 
(viii) Australia's measures are not inconsistent with Article 5.5 
4.414  Australia recalls its view that its defence in respect of Article 5.5 was prejudiced by 
New Zealand's failure to specify the basi s of its complaint in its panel request. 
4.415  Australia has comprehensively refuted New Ze aland's contention that New Zealand apples 
and Japanese nashi pears have similar risk profiles.   Unlike the situation with New Zealand apples, 
Japan has measures in place to ma intain area freedom from the releva nt pests for nashi pears exported 
to Australia.  Furthermore, the level of risk is pr oportional to the volume of trade in a product, and 
Australia notes that there have been no imports of  Japanese nashi pears since 2003 and minimal trade 
before that. 
4.416  Australia's measures for New Zealand apples and Japanese nashi pears are commensurate to 
the different level of risk associated with each  product.  Accordingly, New Zealand has not 
demonstrated any inconsistency in the applica tion of Australia's ALOP which has resulted in 
discrimination or a disguised restriction on international trade. 
(ix) New Zealand's undue delay claim remains outside the scope of this dispute 
4.417  New Zealand's undue delay claim remains outside th e Panel's terms of reference.  The Panel's 
preliminary ruling limited the measures at issue to  the requirements listed in bullet point form in 
New Zealand's panel request.  Since that ruling, Ne w Zealand has constantly shifted the basis of its 
undue delay claim in an attempt to bring it within the Panel's terms of reference. 
4.418
 New Zealand currently refers to the "IRA pro cess" and Australia's quarantine framework in 
the context of its undue delay claim, but neither were identified in New Zealand's panel request.  WT/DS367/R 
Page 136  
 
 Furthermore, New Zealand's claim that the "IRA pr ocess" checked and fulfilled the measures at issue, 
ignores the ordinary meaning of the te xt of Article 8 and Annex (C)(1). 
(e) Conclusion 
4.419  Australia has identified serious deficiencies in  New Zealand's legal arguments and evidence, 
and does not consider that New Zealand has impugned the risk assessments for fire blight, European 
canker or ALCM.  Accordingly, New Zealand has faile d to establish that any of Australia's measures 
are inconsistent with the relevant provisions of the SPS Agreement. 
5. Executive summary of Australia's opening oral statement at the second substantive 
meeting 
(a) Introduction 
4.420  This case concerns the conduct of risk assess ments by WTO Members in the "real world", 
where the scientific evidence available is often not comprehensive, the limited scientific data 
available may not fully resolve uncertainties about elements of potential risk pathways, and risk 
assessors must necessarily and legitim ately exercise expert judgment to interpret available scientific 
data and to address uncertainty. 
4.421  Unless New Zealand can establish serious flaws in  Australia's risk assess ments for fire blight, 
European canker or ALCM, the Panel should find th at the Final IRA Report is objectively justifiable 
in light of Australia's ALOP.  New Zealand has not done so and accordingly its case should be 
dismissed. 
(b) The practical realities of conducting risk assessments 
4.422  Dr Schrader confirmed that lack of data is a problem with almost all plant risk assessments, 
particularly where rare events are concerned.  As  a result, nearly every ri sk assessment will involve 
expert judgment.  New Zealand takes the restrictiv e view that scientific evidence may not be relied 
upon if it was generated in a laboratory, and that ri sk pathways are not able to be considered unless 
they have been historically documented and experi mentally confirmed in the field.  If New Zealand's 
view were accepted, risk assessments would be i nvalid unless the scientific ev idence was absolute in 
its completeness and certainty.  New Zealand's view fa ils to accord with the r eality highlighted by the 
experts and Biosecurity New Zealand's own Risk Analysis Procedures .  It also runs contrary to the 
guidance provided in previous WTO SPS cases.
648 
(c) Sufficiency of scientific evidence is not  equivalent to scientific certainty 
4.423  What will be "sufficient" scientific eviden ce for the imposition of SPS measures must be 
assessed according to the specific circumstances an d evidence available for each pest, taking into 
account the ALOP.  By asserting that scientific ev idence will only be "sufficient" if facts are 
experimentally proven under orchard conditions649, New Zealand effectively argues that "sufficient 
scientific evidence" requires "scientific certainty".  However, full scientific certainty does not exist in 
the real world of plant risk assessments. 
                                                      
648 See, for example, Panel Report on Japan – Apples , para. 8.98;  Appellate Body Report on EC – 
Hormones, para. 187. 
649 For example, see New Zealand's second  written submission, paras. 2.111-2.121.  WT/DS367/R 
 Page 137 
 
 
 4.424  Australia agrees that the "conclusions drawn by the Member assessing the risk [must] find 
sufficient support in the scientific evidence relied upon".650  But certain steps in any given pathway 
analysed will be better supported by direct or experimental eviden ce than others, because some issues 
have been subject to greater levels of investigati on, while others may be very difficult to replicate 
experimentally to produce reliable results.  The sufficiency of scientific evidence relied upon by a 
Member is a judgment to be made in relation to the overall  risk assessment. 
4.425  Australia acknowledges that certain steps in th e pathways assessed were better supported by 
evidence than others in the Final IRA Report.  In those latter cases, expert judgment was employed.  
But this does not undermine the overall sufficiency of scientific evidence relied upon in the Final IRA 
Report. 
4.426  In Australia's view, the mere fact that a path way has not been historically confirmed is no 
reason to dismiss a risk as pure speculation.  The experts agreed with this view and Dr Paulin 
recognized the legitimate role of using hypotheses in conducting risk assessments.  It is common 
practice for WTO Members – including New Zealand itself651 – to impose SPS measures on fruit 
imports despite there being no historically proven pathway for particular diseases.  If fruit can be 
infected and carry the causal organism of  a particular disease, then it has the potential  to introduce 
that disease to the importing country.  In such ci rcumstances, a risk ass essment is based on the 
biology of the disease. 
4.427  New Zealand denies that it is judging what ri sks are significant for Australia.  However, it 
does precisely this when it argues that the standard  of sufficient scientific evidence contemplated by 
the SPS Agreement can only be met by conclusive, hist orical proof of a pathway.  This is because a 
judgment as to whether the likelihood of a pathwa y being completed is "insignificant" is a value 
judgment about the acceptable level of risk.  Th e key issue is whether or not the risk exceeds 
Australia's  ALOP. 
(d) Standard of review and burden of proof remain fundamentally important 
4.428  Australia has not sought to "shelter" the Fi nal IRA Report from review, as New Zealand has 
claimed.652  Rather, Australia has argued that the Pane l should begin its examination with the Final 
IRA Report.  Australia recognizes the legitimacy of WT O scrutiny, but any review must be consistent 
with the "delicate and carefully negotiated balanc e" of rights and obligations contained in the 
SPS Agreement.  The substance of Australia's submi ssions on standard of review has been confirmed 
by the Appellate Body in US/Canada – Continued Suspension .653 
4.429  New Zealand's burden of proof, which flows fro m the standard of review, requires it to 
establish serious flaws with the risk assessments at i ssue before the Panel may find that they are not 
objectively justifiable.  Moreover, the objective ju stifiability of a risk assessment is not impugned 
unless New Zealand has demonstrated that any serious  flaws identified suggest to the Panel that, if 
absent, there would  have been a lower level of assigned risk – not merely that this might  have 
happened.654 
                                                      
650 Appellate Body Reports on US/Canada – Continued Suspension , para. 591. 
651 New Zealand has in place measures to protect agai nst the entry of certain pathogens on papaya and 
lychees:   Bipolaris hawaiensis,  Pestalotiopsis sp . and Pytophthora capsici.  
652 New Zealand's second written submission, paras. 1.5 and 1.8. 
653 Australia's second written submission, paras. 13-18;  Appellate Body Report on US/Canada – 
Continued Suspension , paras. 590-615. 
654 Appellate Body Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.57. WT/DS367/R 
Page 138  
 
 4.430  New Zealand has to meet its burden of proof.  It cannot rely on either the Panel or the experts 
to make its case.
655  Furthermore, these proceedings do not constitute a "peer review" of the Final IRA 
Report, whereby the Panel can rely on the experts to  choose a preferred view of the science, because 
doing so would constitute a de novo  review.  Multiple legitimate opinions may result where there is 
scientific uncertainty, such as when there is a lack of data. 
(e) The Final IRA Report constitutes a scientific opinion 
4.431  New Zealand argues that the Final IRA Report "does not itself constitute independent 
scientific opinion or scientific evidence".656  But this is inconsistent with the views of past panels and 
the Appellate Body, who have accepted that risk  assessments unquestionably constitute scientific 
opinion.657  Thus, if the risk assessments at issue are obj ectively justifiable, Australia is entitled to rely 
upon them as the basis of its measures, whether or  not the conclusion on risk is a "divergent or 
minority opinion". 
(f) New Zealand seeks to revive its case 
4.432  New Zealand has attempted, in its rebuttal subm ission, to revive its case by introducing new 
arguments which it had previously failed to pursue.  For example,  New Zealand has used its rebuttal 
submission to attempt to expand its claims under Ar ticle 5.6 by seeking to introduce further potential 
"alternative" measures for the three pests at issue.658  The Panel should not allow this to occur. 
(g) The role of experts is limited 
4.433  According to the Appellate Body in  US/Canada – Continued Suspension , experts assisting 
panels in SPS disputes have a very sp ecific and limited role:  to provide advice  to the panel and to 
assist  the panel on the technical and scientific aspects of  this dispute.  Panels may not defer judgment 
to experts on matters which ultimately require the panel to draw legal conclusions, such as what 
amounts to "sufficient scientific evidence".  The experts' views should not be considered determinative  of the issues in dispute, especially wher e the question is not whether something can 
occur, but how likely  it is to occur.  A rigorous review of any risk assessment will always highlight 
particular points on which qualified and respected scientis ts disagree.  It is not for the Panel to choose 
between different views. 
(h) Methodology 
4.434  Australia has demonstrated that New Zealand's assertions of fundamental flaws in the semi-
quantitative methodology used in the Final IRA Repor t contain significant technical errors and lack 
evidentiary support.  New Zealand has failed to make its case on methodology. 
4.435  In the meeting with the experts, Dr Sgrillo a dvised that the semi-qua ntitative model used in 
the Final IRA Report was acceptable.  He observed that the assessment of the likelihood of entry, 
establishment and spread was conducted on a quantitativ e basis, while the evaluation of consequences 
was conducted on a qualitative basis. 
                                                     
 
655 See Appellate Body Report on Japan – Agricultural Products II , para. 129. 
656 New Zealand's opening oral statement at the first meeting of the Panel with the Parties, para. 49;  
New Zealand's second written submission, paras. 2.76, 2.107, 2.314.  
657 See Appellate Body Report on EC – Hormones , para. 194;  Panel Report on EC – Marketing and 
Approval of Biotech Products , paras. 7.3059-7.3060;  Appellate Body Reports on US/Canada – Continued 
Suspension , para. 591. 
658 See New Zealand's second written submission, pa ras. 2.894-2.895;  New Zealand's first written 
submission, paras. 4.490, 4.491, 4.513.  WT/DS367/R 
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 4.436  New Zealand takes issue with the use of the probability interval 0–10-6, in particular, the 
maximum value of 10-6, or one in a million. New Zealand asserts that this maximum value is 
"significantly greater than can be justified on the basis of known data", including trade data.659  
Australia has demonstrated that New Zeal and's reliance on trade data is flawed.660 
4.437  There is a fundamental contradiction in New Zeal and's case which is starkly illustrated by its 
claim that trade data may support its case and yet the Final IRA Report is to be judged strictly against 
experimental evidence under orchard conditions.  Indeed, New Zealand insists that the IRA Team 
should have used trade data to inform its expert judgment. 
4.438  New Zealand asserts that, in terms of the volumes  of apples that may be exported to Australia, 
the chance of something occurring once in a milli on apples may not be seen to be negligible.661  It 
states that: 
"[A]n adverse event with a probability of 1 x 10-6 on a per-apple basis is equivalent to 
an expected occurrence of once in a million apples, or 150 times per year, based on … Australia's estimate of the most likely vo lume of apples traded (that is, 150 million 
apples per annum)."
662 
4.439  New Zealand creates a misleading impression in referring to an event occurring 150 times 
every year.  It does not specify the nature of th e adverse event, where it occurs on a pathway, and 
whether that event would occur in the total population of 150 million apples.  Without the specific case being given, New Zealand's calculation lacks an y concrete connection to the Final IRA Report. 
4.440  New Zealand also notes that the mean of the interval 0–10
-6, when applied as a uniform 
distribution, is 5 x 10-7, or one in two million.  It states that, if an adverse event has a probability of 
occurring once in two million apples, then, in  a population of 150 m illion imported apples, 
75 occurrences would occur.663  Again, without the specific case being given, New Zealand's 
calculation is in the abstract and lacks any concrete connection to the Final IRA Report. 
4.441  In this regard, Australia recalls that, in the meeting with the experts, Dr Sgrillo acknowledged 
that, if only a proportion of a total population of a pples was infested, then th e expected number of 
events would be reduced proportionately.  Based on his example of applying one in a million to 200 
million apples, giving 200 events, Dr Sgrillo agreed that if the infested population was only 1 per cent 
of the total population, or two million apples, then  the number of expected events would be two. 
4.442  New Zealand asserts that there was "no evid ence, presented anywhere" that there was a 
"structured or recognized" process in place for eliciting the opinions of IRA Team members.664  
New Zealand's error in making this assertion was hi ghlighted in the meeting with experts when 
Australia referred the Panel and New Zealand to Ap pendix 1 of the Final IRA Report, which contains 
a summary of key points of  the elicitation process. 
4.443  New Zealand's assertion that the semi-qua ntitative methodology overestimates the likely 
volume of trade in apples from New Zealand is  based on faulty suppositions.  New Zealand wrongly  
supposes that:  Australian consumers will not buy the main varieties of apples it produces, such as 
Royal Gala and Braeburn;  Austra lian supermarkets will be unlikely to stock New Zealand apples;  
                                                      
659 New Zealand's first wr itten submission, p. 95. 
660 See Australia's first written submission, paras 3 08-311;  New Zealand's second written submission, 
paras. 247-263. 
661 New Zealand's first writte n submission, para. 4.180. 
662 New Zealand's second writte n submission, para. 2.342. 
663 New Zealand's first writte n submission, para. 4.191. 
664 New Zealand's second writte n submission, para. 2.348. WT/DS367/R 
Page 140  
 
 the volume of New Zealand apples entering the Australian market would lead to large price falls, 
making its exports uneconomic;  a nd New Zealand's apple exporters will not divert apples to the 
Australian market.  As to the economic viability of  New Zealand apple exports, Australia recalls the 
views of advisors to the New Zealand apple indus try that Australia represents a significant export 
opportunity. 
(i) Fire blight 
(i) The fire blight case is essentially about the accep table level of scientific uncertainty in risk 
assessments 
4.444  The case for fire blight essentially comes down to  the degree of scientific uncertainty that the 
SPS Agreement can tolerate in a risk assessment.  What is acceptable will depend on how the 
elements of uncertainty – that is, what we do not know, and perhaps cannot prove about fire blight – 
measure up against what we do know a nd have proven about fire blight. 
4.445  New Zealand's burden of proof is central to the fire blight case.  New Zealand must show that 
the elements of uncertainty result in  flaws so serious that, if absent, would  have led to a lower level of 
overall assessed risk.
665 
4.446  In this regard, it is significant that the fire blight experts not only confirmed that there is a 
potential pathway for fire blight through mature apples666, but that there is a real risk present to be 
assessed and managed.  Dr Paulin explicitly supp orted Australia's two principal risk reduction 
measures, supporting the IRA Team's view that th e risk associated with that pathway is above 
Australia's ALOP. 
(ii) New Zealand's "pathway" argument is the core of its fire blight case 
4.447  The central pillar of New Zealand's argument is  the claim that there is no scientific evidence 
supporting a pathway for fire blight through mature, symptomless apples.667  In effect, New Zealand 
claims that risks do not exist unless the pathway has been historically documented and experimentally 
proven. 
4.448  However, this requirement has no basis in  the SPS Agreement or the international 
standards.668  Dr Schrader confirmed that the absence of a historical pathway is not a sound reason for 
excluding a risk.669  Similarly, Articles 5.1 and 2.2 do not refer to pathways and do not impose any 
requirement that Members assess only the pathways  that have been historically documented. 
(iii) The fire blight pathway is substantially confirmed 
4.449  The fire blight experts confirmed that the path way for fire blight through mature apples is far 
from being wholly "speculative".  The pathway is substantially confirmed with some elements of 
uncertainty. 
                                                      
665 Panel Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.57.  See Australia's first 
written submission, para. 346. 
666 See also reply of Dr Paulin to Panel questions 16 and 45, in List of Replies from the scientific 
experts to questions posed by the Panel. 
667 See for example New Zealand's second written submission, paras. 2.104, 2.108, 2.110, 2.111, 2.120, 
2.123, 2.127, 2.451-2.454. 
668 For example, ISPM No. 11. 
669 Reply of Dr Schrader to Panel question 45, in List of Replies from the scientific experts to questions 
posed by the Panel;  Oral comment of Dr Schrader at the experts' meeting, 30 June 2009.  WT/DS367/R 
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 4.450  It is beyond doubt that live E. amylovora  will enter Australia on the surface of mature apples 
if trade occurs.670  It is beyond doubt that Australia has suitable conditions for the establishment of 
fire blight disease.671  It is also beyond doubt that if fire b light were to establish in Australia, there is 
the potential for spread within geographic regions.672  Finally, it is beyond doubt that fire blight has 
the potential to cause severe economic and biological loss. 
4.451  Only one step in the pathway is uncertain, and that is whether E. amylovora  can be 
transmitted from an apple to a susceptible host plant and initiate a fire blight infection.  But even this 
step is supported by indirect evidence that transm ission can occur.  Dr Paulin confirmed that rotting 
apples discarded in an orchard can provide a possible source of inoculum.673  The experts also 
confirmed that vectoring through pollinating insect s could occur in the way described by the IRA 
Team.674  Finally, the IRA Team's view that small numbers of bacteria can multiply to cause 
infections in susceptible hosts is  supported by scientific evidence. 
4.452  When this evidence is taken together, the IRA Team's judgment that transmission could occur 
in a rare case can hardly be dismissed as "speculation".675  Indeed, Australia's view is corroborated by 
other WTO Members who impose very similar risk management measures to Australia.676 
(iv) New Zealand's evidence is not relevant to Australia's circumstances 
4.453  Even leaving these issues to one side, New Ze aland cannot simply assert that the pathway is 
"hypothetical".  It must prove this point with evidence and argument.  
4.454  New Zealand's pathway argument, and indeed its fire blight case, rests primarily on three 
pieces of evidence:  Japan – Apples , Roberts and Sawyer (2008) and "real world" trade data.  It is 
highly significant that each of these three bases have either been discredited by Australia677, rejected 
by the experts as irrelevant or inappropriate678, or both.  Recently, New Zealand has asserted that 
several other studies also point to a lack of a pathway.  However, much of this evidence679 is 
unreliable for drawing conclusions about the risk in Australia's circumstances. 
4.455  Hale et al.  (1996) and Taylor et al.  (2003a) do not say anything about rare events as the 
sample sizes are not comparable to commercial volumes of apples.  Roberts et al.  (1998), like Roberts 
                                                      
670 CABI.  Indeed, the vast preponderan ce of scientific ev idence accept that E. amylovora  will be found 
on the surface of apple fruit when sourced fr om areas where fire blight is endemic. 
671 Australia's first written submission, para. 482. 
672 Australia's first written submission, para. 485. 
673 Reply of Dr Paulin to Panel question 21, in List of Replies from the scientific experts to questions 
posed by the Panel. 
674 Even New Zealand agrees that insects are a mean s of secondary spread.  New Zealand's reply to 
Panel question 61 after the first substantive meeting, para. 96.  Reply of Dr Paulin to Panel question 35, in List 
of Replies from the scientific experts to questions posed by the Panel. 
675 New Zealand's first written submission, paras. 4. 8, 4.237, 4.252;  New Zealand's second written 
submission, paras. 2.492 and 2.452. 
676 See Australia's second written submission, paras. 342 and 343. 
677 In relation to Japan – Apples , see Australia's first written submission, paras. 250-262;  Australia's 
reply to Panel question 40 after the first substantive me eting; Australia's second written submission, paras. 325-
329.  In relation to Roberts and Sawyer (2008), see Australia's first written submission, paras. 363-376;  
Australia's second written submission, paras. 330-337 and Anne x 1.  In relation to trade data, see Australia's first 
written submission, paras. 308-311;  Australia's sec ond written submission, paras. 247-263 and 338-343. 
678 Reply of Dr Paulin to Panel questions 41 and 44, in List of Replies from the scientific experts to 
questions posed by the Panel;  Reply of Dr Deckers to Panel questions 41 and 44, in List of Replies from the scientific experts to questions posed by the Panel. 
679 With the exception of Taylor et al. (2003b), as Australia has discussed. WT/DS367/R 
Page 142  
 
 and Sawyer (2008), is focussed on restricted risk an d therefore indicates nothing about potential risks 
when trade is unrestricted.
680 
4.456  Finally, much of the scientific evidence Ne w Zealand relies upon concludes that the pathway 
is "negligible", not that it does not exist.  This is important:  "negligible" is not zero, nor does it mean 
that an event will not occur, unless you define "negligible" as "insignificant" or "not worth 
considering".  But, the significance or otherwise of  a potential event is ultimately a value judgment 
associated with ALOP and, therefor e, a judgment for Australia alone.681 
(v) New Zealand has not demonstrated seri ous flaws in the Final IRA Report 
4.457  Once New Zealand's pathway argument falls aw ay, the only remaining question is whether 
New Zealand has established serious flaws in the Fi nal IRA Report.  New Zealand has consistently 
failed to show any serious flaws in the levels of  probability assigned to key steps in the pathway. 
4.458  New Zealand asserts that the probability of 1 given for importation step 1 is overestimated 
since E. amylovora  cannot be present in all source orchards in New Zealand.682  However, under 
Article 6 of the SPS Agreement, it is up to exporting  Members to "objectively demonstrate" disease 
free areas and areas of low pest prevalence.  It wo uld be very surprising if a lesser standard of 
objective proof was required under Article 5.1.  In this case, New Zealand had many opportunities to 
provide the relevant evidence to th e IRA Team but declined to do so.683  It is therefore not credible for 
New Zealand to effectively argue that it has a claim to area freedom when it clearly does not. 
4.459  Similarly, New Zealand implies that, under im portation step 4, the IRA Team should have 
assumed that that an undefined number of pack ing houses achieve equivalence to Australia's 
disinfection measure.  However, New Zealand h as not provided "objective" proof as to whether 
disinfectant is applied effectively.684  Accordingly, New Zealand has no legitimate claim of 
equivalence pursuant to Article 4.1. 
4.460  Importation steps 2, 3 and 5 make the most significant contribution to the probability of entry.  
However, New Zealand's arguments on importation step 2 are not credible in light of its failure to 
acknowledge the critical assumptions un derpinning the IRA Team's analysis685 and its insistence that 
endophytic infection is relevant to the IRA Team's  assessment in the face  of clear and explicit 
statements to the contrary.686  In relation to importation steps 3 and 5, New Zealand led no substantive 
evidence and argument of its own in the first stages of this dispute.  The Panel should take care that it 
does not inadvertently make the case for New Zeala nd by allowing the experts' replies to plug the 
significant gaps in New Zealand's evidence.687 
4.461  Even leaving the legal concerns aside, the expert s' replies do not raise an inference of serious 
flaws.  New Zealand may have shown that the experts had some doubts about some of the IRA 
Team's use of evidence.  But all that this means is  that the experts did not agree with the IRA Team's 
analysis in its entirety.  It is simply not enough for New Zealand to point to minor flaws and assume  
that they are sufficient to overturn th e risk assessment.  New Zealand has to prove  that the absence of 
any shortcomings would have led to a lower le vel of assessed risk, and in this it has failed. 
                                                      
680 Australia's second written submission, Annex 1. 
681 See European Communities' third party submission, para. 33. 
682 New Zealand's second writte n submission, para. 2.402. 
683 Australia's IRA, Part B, p. 54. 
684 Australia's second written submission, para. 382. 
685 Australia's second written submission, paras. 371-373. 
686 Australia's second written submission, para. 370. 
687 Appellate Body Report on Japan – Agricultural Products II , para. 129.  See also, Australia's second 
written submission, para. 5.  WT/DS367/R 
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 (j) European canker 
4.462  At the experts' meeting, Professor Latorre re iterated that there is a risk of introducing 
N. galligena  associated with the importation of latently infected apple fruit.688  Both experts agreed 
that the long distance spread  of European canker via apple fruit could not be ruled out.689 
4.463  Contrary to what New Zealand asserts, the Fina l IRA Report contains an objective, coherent 
and substantive analysis of the environmental conditions, including climate, relevant to the 
establishment and spread of European canker.690  The validity of this analysis has been confirmed by 
the work undertaken by the Bu reau of Rural Sciences (BRS).691 
4.464  Rather than identifying any serious flaws in  the IRA Team's consideration of climate, 
New Zealand has simply introduced an alternative c limate analysis in an attempt to impose its own 
view of the science on Australia.  There is ongoing debate in the scientific community regarding the 
climatic conditions required for European canker de velopment, resulting in a variety of predictive 
models.692  Dr Swinburne confirmed that there is no co mplete model but rather a range of models 
which are yet to be joined up, and that expert judgment was required. 
4.465  The BRS climate analysis draws on various predictive models, including New Zealand's own 
Beresford and Kim model , to demonstrate the climatic similarity between parts of Australia and those 
areas of the world where European canker is present.693  It shows that, if European canker entered 
Australia, it could establish and spread to host plan ts in commercial apple growing regions, such as 
the Adelaide Hills in South Australia, and metropo litan areas, such as Sydney and Melbourne.  Both 
European canker experts accepted th is at the experts' meeting. 
4.466  The alleged unsuitability of Australia's climat e lies at the core of New Zealand's case on 
European canker.  It underpins New Zealand's argu ments on spore production, dispersal and infection; 
on establishment and spread; on alternative hosts; on the Spreyton disease outbreak; and on 
consequences.  Therefore, once you accept the reality that New Zealand does not have the only legitimate predictive model for European canker development, its case falls away.
694 
4.467  New Zealand continues to equivocate on the incidence of latent fruit infection in 
New Zealand which was the focus of the IRA Team's  analysis under importation step 2.  However, 
fruit rot occurrences have been reported in New Zeal and and it follows that latent fruit infection does 
occasionally occur in New Zealand.695  This was the view of the IRA Team696 and it was accepted by 
Dr Swinburne. 
4.468  Contrary to what New Zealand asserts, the IRA Team's view that discarded infected apples 
can produce spores (primarily conidia) which disper se and initiate infection, is legitimate science.697  
This view is consistent with the biology of fu ngal pathogens as evidenced by photographic evidence 
                                                      
688 See reply of Dr Latorre to Guideline (g) and Panel question 65, in List of Replies from the scientific 
experts to questions posed by the Panel. 
689 See also reply of Dr Swinburne to Panel question 64, in List of Replies from the scientific experts to 
questions posed by the Panel. 
690 Australia's IRA, Part B, pp. 119-120, 137, 140, and 141. 
691 Australia's first written submission, Annex 2;  Australia's second written submission, Annex 2. 
692 Australia's second written submission, Annex 2, pp. 249-250. 
693 Australia's second written submission, Annex 2,  pp. 251-257.  See also Australia's first written 
submission, Annex 2, Figure 10. 
694 Australia's second written submission, paras. 532-550. 
695 Australia's second written submission, paras. 473-485. 
696 Australia's IRA, Part B, p. 123. 
697 Australia's second written submission, paras. 507- 521. WT/DS367/R 
Page 144  
 
 showing masses of conidia on rotten fruit.
698  It also finds support in Professor Latorre's view that 
asymptomatic but infected apples could develop symp toms and eventually sporulate during transit and 
commercialisation in Australia699, and that rotted fruits discarded near susceptible hosts could be a 
source of inoculum for infections in new areas.700 
4.469  New Zealand's criticism of the IRA Team's c onsequences analysis disregards Australia's 
particular circumstances, including that there are a wide range of alternative hosts in Australia.701  
Plant pathology information from around the world702 invariably refers to European canker as having 
serious consequences.  Dr Swinburne noted the occurre nce of 5 per cent fruit rot at East Malling in the 
UK703, an area which only had marginal climatic suita bility for development of the disease.  This is 
consistent with the IRA Team's "moderate " rating for European canker consequences. 
4.470  In sum, although there is a low risk associated  with importing New Zealand apples, it exceeds 
Australia's ALOP.  Accordingly, the IRA Team de termined that it was necessary to source apples 
from New Zealand export orchards or blocks free of the disease.  Professor Latorre reiterated that this 
is a reasonable risk mitigation measure.704  Both experts agreed that requiring New Zealand to export 
"mature, symptomless apples" would not achieve Australia's ALOP. 
(k) ALCM 
4.471  The Panel's consideration of the ALCM risk  assessment needs to be cognisant of the 
significant lack of data available on several of th e key issues in dispute – including the viability of 
ALCM on New Zealand apples.  ALCM is present in only a few countries and, as Professor Cross 
confirmed, there has been relatively little research c onducted or reliable data generated on this pest. 
4.472  During these proceedings, New Zealand has provided new data on a number of issues in its 
attempt to criticise the IRA Team's evaluation of ALCM.705  Obviously, however, the IRA Team 
could not have considered information that was not available to it during the IRA process.  Australia 
recognizes that this new information would need to be taken into account in any review of the import 
conditions.  But it is clear that further reliable data is required, and New Zealand is in the best position 
to provide the appropriate information. 
4.473  New Zealand does not seriously dispute that ALCM could establish in Australia from a 
biological perspective.  Professor Cross' reference to the "powerful life force" in the context of the 
insect's potential survival in a new environment was significant in this regard.  Rather, New Zealand 
relies on its assertion that the "majority" of its e xports will be in the "retail ready" form, which 
New Zealand contends means that insufficient nu mbers of infested apples would come within 
proximity of suitable hosts.  And secondly, that "Australian agricultural waste practices would 
preclude any opportunity for ALCM establishment" because of New Zealand's conjecture that apple 
                                                      
698 Exhibit NZ-10:  McCartney (1967), p. 279. 
699 Reply of Dr Latorre to Panel question 65, in List of Replies from the scientific experts to questions 
posed by the Panel. 
700 Reply of Dr Latorre to Panel question 69, in List of Replies from the scientific experts to questions 
posed by the Panel. 
701 Australia's second written submission, paras. 578-580. 
702 Australia's second written submission, Annex 3. 
703 Exhibit AUS-142:  Berrie (1989). 
704 Reply of Dr Latorre to Guideline (g), in List of  Replies from the scientific experts to questions 
posed by the Panel. 
705 New Zealand's advice that the August 2005 data related to occupied  cocoons in New Zealand's 
response to the experts' factual qu eries, 17 February 2009;  New Zealand's clarification of the Rogers et al . 
(2006) paper in Exhibit NZ-102;  data on adult emergence in Sandanayaka and Rogers (2009), Exhibit NZ-119.  WT/DS367/R 
 Page 145 
 
 
 waste is never left exposed in Australia.706  In Australia's view, New Zealand has failed to establish 
the validity of either of these propositions.  Professo r Cross confirmed that if large volumes of apples 
were directed to orchard packing hou ses, the risks would be considerable. 
4.474  Neither Australia nor New Zealand is in a position to specify with any degree of precision 
how frequently the mode of trade would be via bulk  fruit as opposed to "retail ready" fruit.  It will 
depend on commercial considerations  which will vary according to the market circumstances at a 
particular time. 
4.475  And even if the "majority" of apples were im ported retail ready, this does not mean that 
insufficient quantities would be sent to orchard wholesalers for repackaging or reconditioning.707  
Similarly, New Zealand has failed to establish that apple waste would be managed in the way that it 
asserts, and that groups of apples would never be le ft out of cold storage near host plants for a 
sufficient length of time.708  The Final IRA Report illustrates that there would be more than enough 
infested apples distributed to orchard packing hou ses for there to be a reasonable likelihood of an 
establishment event taking place709, even if the actual level of infestation of New Zealand apples is 
somewhat lower than the IRA Team assumed on the basis of the August 2005 data. 
4.476  Professor Cross validated the IRA Team's judgment on the question of adult emergence from 
cold storage, when he confirmed at the experts' meeting that adults could potentially emerge very 
quickly.  New Zealand's claim that "the IRA's co nclusions were based on the assumption that all 
ALCM present on New Zealand apples would simu ltaneously emerge as soon as the apples were 
removed from cold storage"710 is simply wrong.  The IRA Team's analysis was focussed on "the 
likelihood of at least one  establishment and spread event happening" in light of the number of apples 
that might arrive at particular locations.711  Emergence of individuals over a period of time does not 
mean that a mating pair could not emerge simulta neously.  Further, Professor Cross has made clear 
that the IRA Team's consideration of flight distance was reasonable. 
4.477  In circumstances where the unrestricted risk is  above Australia's ALOP, Dr Sgrillo agreed 
with Australia that the underlying level of infesta tion is the appropriate factor for determining the 
requisite rate of inspection.  New Zealand's pr oposed 600-unit inspection would be insufficiently 
sensitive to reduce the risk to Australia's ALOP given the low level of ALCM-infestation on 
New Zealand apples.712 
(l) The measures at issue 
4.478  Australia considers that the Panel may make findings in respect of each of the remaining 
measures at issue in this dispute.  However, New Ze aland has failed to demonstrate that each of those 
measures fall within the definition of "SPS measure" when taken alone. 
4.479  The description of the measure listed at the eight h bullet point in New Z ealand's panel request 
suggests that registered packing houses which pr ocess apples intended for Australia may not also 
                                                      
706 For example, see New Zealand's second written su bmission, paras. 2.252, 2.750, 2.752, 2.754. 
707 See Australia's second written submission, paras.  651-654;  Australia's first written submission, 
paras. 781-783. 
708 See Australia's second written submission, paras. 659-665. 
709 See Australia's second written submission, paras. 644-649. 
710 New Zealand's second written submi ssion, para. 2.741 (footnote omitted). 
711 Australia's IRA Report, Part B, p. 34 (emphasis added). 
712 Also, see Australia's second written submission, paras. 682-687. WT/DS367/R 
Page 146  
 
 process apples sourced from non-registered orchards or apples intended for other markets. This is 
incorrect.
713 
(m) Conclusion 
4.480  The importation of US table grapes provides a "real-world" example of Australia's 
commitment to seeing trade flow freely within the bounds of its ALOP.  Based on the scientific data 
collected since trade began, the measures have been  adjusted five times.  The measures are now less 
trade-restrictive and trade has grown.  The same review mechanisms are available in the Final IRA 
Report for New Zealand apples.  Australia stands ready to allow commercially valuable trade in 
New Zealand apples to occur. 
6. Australia's closing oral statement at the second substantive meeting 
(a) Introduction 
4.481  It is beyond dispute that this case raises a large number of complex scientific questions.  
There are three risk assessments at issue:  one each on  a bacterium, a fungus and an arthropod.  Given 
the complexity of the issues, it is clear why the Panel's role is not to undertake its own risk 
assessment. 
(b) Standard of review 
4.482  Australia submits that this means that the Pa nel must find serious flaws in the Final IRA 
Report if it is to decide that Australia has acted in consistently with its oblig ations.  New Zealand has 
provided no serious alternatives to the "serious fl aws" burden of proof.  In this regard, the Panel 
should follow the clear guidance that the Appellate Bo dy has provided on the role of experts in SPS 
cases. 
4.483  In any event, New Zealand has not established any such serious flaws that would impugn the 
objective justifiability of the thr ee risk assessments at issue.  A ccordingly, its challenge against 
Australia's measures must fail. 
(c) Transparency 
4.484  New Zealand repeatedly claims that the Fi nal IRA Report is not transparent.  But 
New Zealand fails to acknowledge that the Final IR A Report is among the most transparent plant risk 
assessments prepared by any WTO Member.  The ve ry fact that New Zealand has been able to 
challenge its reasoning and c onclusions in such detail testifies to its transparency.  New Zealand's own 
risk assessments – which in many cases remain entirely unpublished – contain far less detail about the 
reasoning and conclusions than the Final IRA Report. 
4.485  New Zealand has been unable to point to any obligation in the SPS Agreement that requires 
transparency in risk assessments beyond that pr ovided in the Final IRA Report.  WTO Members 
agreed on a range of disciplines to apply to risk assessments, and they are set out clearly in the 
SPS Agreement.  On the issue of transparency, th e Final IRA Report exceeds the standards required. 
(d) Methodology 
4.486  Australia considers that in the course of the meeting with the experts and the second 
substantive meeting there has been a valuable exam ination of the issues relating to the methodology 
                                                      
713 See Australia's IRA, Part B, p. 317.  WT/DS367/R 
 Page 147 
 
 
 used in the Final IRA Report.  Australia has show n that New Zealand's assertions on methodology are 
deeply and irretrievably flawed. 
4.487  Australia has identified a fundamental contradi ction in New Zealand's case that, on the one 
hand, it seeks to support its own case with trade data, yet, on the other hand, it requires the Final IRA 
Report to be judged strictly against experimental  evidence.  New Zealand has not addressed this 
contradiction. 
4.488  Australia also notes the discussion of the interval 0-10-6, in particular, the exchanges between 
the Panel and the Parties this morning.  In this regard, Australia recalls the fundamental difference 
between the total population and the relevant popu lation.  The Chairman's funnel was a useful 
analogy. 
(e) Fire blight 
4.489  The Final IRA Report is the scientific basis of Au stralia's measures, and therefore, the fate of 
those measures, stand or fall with its validity. 
4.490  Before the Panel gets to the question of whethe r the risk assessment is valid, it must first be 
satisfied that New Zealand has made out a convi ncing case on fire blight.  If the Panel thinks 
New Zealand has, then it must ask whether Aust ralia has provided an appr opriate defence of its 
measures.  But if the Panel does not think New Zealand has made out its case, if the Panel has doubts about whether New Zealand has led ad equate evidence and argument to prove that the fire blight risk 
assessment is seriously flawed, then the Panel must dismiss New Zealand's case for failure to meet its 
burden of proof. 
4.491  In the case of fire blight, there is a genuine question about whether New Zealand has met its 
burden of proof.  Its primary contention – that ther e is no pathway for fire blight through mature 
apples – has been shown to be wholly without basi s by Australia and confirmed by Dr Deckers and 
Dr Paulin.  The three key evidentiary pillars of New Zealand's case, have been discredited and shown 
to be irrelevant.  In its opening statement, New Zealand attempted once again to elevate the findings 
in Japan – Apples  to the status of scientific evidence
714 and has done so again in its closing statement.  
However, New Zealand still ignores the critical poin t that legal findings on the sufficiency of 
evidence led by the Parties in dispute ca nnot be converted into scientific facts.715 
4.492  This is not a case of expert equivocation or doubt .  All of the experts agreed that fire blight 
has serious consequences.  Indeed, Dr Schrader noted that where the impact of a pest is high and there 
are open questions about entry, then uncertainties in  the data should not prevent the application of 
measures.  As New Zealand has put no substantive argument on this issue of consequences either in 
its second written submission, or in the course of  the second substantive meeting, Australia now 
considers that this point is undisputed. 
4.493  Even more significantly, Dr Deckers and Dr Paulin  both confirmed clearly that the risk of fire 
blight through mature apples is a real one – a ri sk worth assessing, and more importantly, one that 
necessitates risk management.  Australia's principa l risk management measures have been endorsed 
without qualification, and neither expert adjusted their view that mature, symptomless apples will not 
                                                      
714 Despite its claim that Japan – Apples  is not scientific evidence, and not a risk assessment.  See 
New Zealand's reply to Panel's question 11 6 after the first substantive meeting. 
715 Australia notes that Japan did not lead sufficient evidence in its risk assessment on many of the 
scientific issues in Japan – Apples .  This had a material impact on the evidentiary findings in that case, as is 
evident from the panel report itself (see Panel Report on Japan – Apples , paras. 8.147, 8.167 and 8.175).  See 
Australia's first written submission, paras. 257-259. WT/DS367/R 
Page 148  
 
 meet Australia's ALOP.  In Australia's view, these comments must bear significant weight in 
determining whether the ultimate conclusion in th e fire blight risk assessment meets acceptance 
within the scientific community. 
4.494  As Australia stated, only one step in the risk  assessment is subject to any real degree of 
uncertainty.  And on this issue, the Panel has heard extensively from the experts.  The experts 
confirmed that the scientific evidence on this issue is  highly uncertain and only tells us directly about 
what is probable, but not what might happen ex ceptionally.  Thus, it is easy to see how WTO 
Members concerned only with common risks could be satisfied on the evidence that the risk, for them, 
would be insignificant. 
4.495  But for WTO Members such as Australia, who ar e concerned with rare events, the evidence 
discloses no such certainties.  Therefore, the IRA T eam had to exercise expert judgment to extrapolate 
from the available evidence to draw a conclusion about  whether a rare event could occur.  Dr Paulin 
has told us clearly that these sorts of inferences are "not outside science".  Accordingly, the key 
question is whether the Panel is satisfied that the IR A Team's judgment that this event could occur is a 
rational inference from the evidence. 
4.496  Australia does not have to establish that mature apples have been  the vehicle for transmission 
of fire blight.  Nor does Australia have to show it is likely  to happen.  When talking about a potential 
pathway, all that has to be shown is that it can rationally happen, that the probability range assigned to 
that step is acceptable, and that the potential risk is above Australia's ALOP. 
4.497  On each of these points, the IRA Team's analysis  was directly vindicated by the experts.  
When asked directly whether the IRA Team had presented evidence which shows that mature fruit 
can transmit fire blight, both Dr Paulin and Dr D eckers said "yes".  When asked directly whether the 
probability range assigned to this step – that is, (0-10
-6) – was acceptable, both experts said "yes".  
Finally, when asked directly whet her there was a risk of fire b light through mature apples, both 
experts again said "yes".  Dr Deckers was very clear on this point – for him, the risk was real and not 
exaggerated. 
4.498  Australia considers that the exposure analysis in the Final IRA Report has been shown to be 
rational and to constitute legitimate science according to th e standards of the scientific community.  In 
deciding whether the Panel can accept this view, it ma y be worth considering the alternative view of 
this evidence that New Zealand has put before the Panel in its arguments.  New Zealand asserts, on 
the basis of evidence including Hale et al.  (1996) and Taylor et al.  (2003a) that transmission does not 
occur, and will never occur.  The experts unanimously confirmed that this view is incorrect.  Thus, to 
the extent that there is any choice between the two positions put before the Panel, it is important to 
keep in mind that while Australia's position is rational on the available science, New Zealand's 
position is not. 
4.499  This is the only real step in contention as New Zealand has failed to make a case on the key 
importation steps, through failure to lead any credib le evidence of its own.  This was highlighted in 
New Zealand's responses to questions put by Austra lia where New Zealand had failed to point to any 
evidence apart from the experts' replies.716  But as New Zealand itself acknowledged, experts replies 
are not evidence in themselves, but can only verify  the arguments and evidence of the Parties.  
Accordingly, as Australia considers that the expe rts have supported the key elements of the IRA 
Team's reasoning, Australia considers that New Zealand's case on fire blight fails. 
                                                      
716 Australia notes that para. 4.228 of New Zealand's first written submission and para. 2.426 of 
New Zealand's second written submission (as referred to by  New Zealand this afternoon) do not refer to dump 
tank contamination and do not refer to any scientific evidence.  WT/DS367/R 
 Page 149 
 
 
 (f) European canker 
4.500  The foundation of New Zealand's case on Europ ean canker is that Australia's climatic 
conditions are unsuitable for the development of th e disease.  However, there are areas of Australia, 
including commercial apple growing regions, whic h have climatic conditions suitable for the 
establishment and spread of European canker. 
4.501  The practical reality is that climate analysis is a complex area necessitating expert judgment.  
In the real world there is no single universally accepted epidemiological model for predicting the establishment and spread of European canker.  Ac cordingly, there is no reason why New Zealand's 
climate analysis should be regarded as the only legitimate scientific view. 
4.502  After reviewing a wide range of scientific evid ence the IRA Team concluded that there was a 
risk of introducing European canker into Australia as sociated with the importation of latently infected 
New Zealand apple fruit.  Both European canker experts appointed in this dispute agree that this is so.  
The only contested issue relates to the level of this risk. 
4.503  The risk associated with introducing European  canker certainly exceeds Australia's ALOP.  
The IRA Team determined that it was necessary to  source apples from New Zealand export orchards 
or blocks free from the disease.  This is a reasonabl e and practical risk mitigation measure considering 
the serious consequences of the disease which is ab sent in Australia;  both European canker experts 
agree that a measure simply requiring "mature symptomless apples" would not achieve Australia's 
ALOP. 
(g) ALCM 
4.504  As Australia has pointed out on ALCM, it is not possible to be definitive as to the important 
issue of mode of trade in advance of trade comme ncing.  New Zealand's most recent "evidence" in 
this regard (Exhibit NZ-136) relates only to kiwi fruit and not to apples.  Further, it indicates that only a "portion" of New Zealand kiwi fruit are exported to Au stralia in "retail ready" condition.  This is far 
from the guaranteed "majority" of New Zealand apples that New Zealand would have the Panel 
uncritically accept.  In any event, even if the "majority" of New Zealand apples were  imported in 
"retail ready" condition, the IRA Team still f ound that more than enough ALCM-infested apples 
would end up at orchard packing houses together to pose an establishment risk.
717 
4.505  As Australia has already acknowledged, there is a significant lack of data available in relation 
to ALCM, including on viability.  Any change in this  regard largely depends on New Zealand – unless 
it provides further data or carries out further resear ch, the lack of data means significant uncertainty 
will remain.  Australia notes that New Zealand was una ble to provide further data on viability levels 
when this was requested by the experts earlier in the year 2009.718 
4.506  If the present data were to be considered insu fficient, any review would suffer the same 
problem in the absence of further information.  The IRA process contemplates review on the basis of 
new information and Australia stands ready to do th is.  However, without new data, any review will 
face the same difficulties as faced by the IRA Team.  This is the real world which confronts Australia. 
(h) Article 5.6 
4.507  On Article 5.6, New Zealand's opening statem ent makes it clear that the only "alternative" 
measures that the Panel should consider are "mat ure, symptomless apples" for fire blight and 
                                                      
717 Australia's IRA, Part B, p. 174, Table 43;  Au stralia's second written submission, paras. 644-649. 
718 Communication from New Zealand to the Panel, 9 April 2009. WT/DS367/R 
Page 150  
 
 European canker, and a 600-unit inspection for ALCM.  New Zealand did not mention any other 
potential alternative measures. 
(i) The Panel's evaluation of the measures 
4.508  It is also clear from this se cond substantive meeting that New Zealand indicated no objection 
with the Panel evaluating each of the measures at  issue on a collective basis, rather than each 
individually.  In Australia's view, th is would be the appropriate approach. 
(j) Real world measures 
4.509  Finally, the real world of apple production and trade inevitably involves damaged fruit, 
discarded waste, diverse handling procedures and inev itable, unpredictable human interaction.  The 
real world does not involve monolithic, sterile procedures.  New Zealand has not offered any 
alternative measures on any of the pests that meet Australia's ALOP. 
4.510  As is clear from a reading of the Final IR A Report, and acknowledged by New Zealand, the 
IRA team considered a number of different measures in  relation to each pest.  For each of the pests, it 
recommended the least restrictive measure of those which would achieve Australia's ALOP.  For most 
pests considered in the Final IRA Report, it found that no risk management measures were necessary 
to achieve Australia's ALOP.  For the three pests at issue, it recommended risk management measures 
largely endorsed by the experts. 
4.511  On fire blight, the experts have confirmed th at Australia's principal measures – symptomless 
orchards and chlorine treatment – are warranted.  On European canker, they have agreed that 
measures to ensure pest-free places of production would be necessary to reduce th e risk to Australia's 
ALOP. 
4.512  On ALCM, the expert expressed the view that th e intensity of any inspection would need to 
be determined by reference to more reliable data such as viability.  But the best existing data indicates 
that the only alternative measure proposed by New Zealand – a 600-unit inspection – would not 
reduce the risk below Australia's ALOP  because it is insufficiently sensitive. 
4.513  It is important for the Panel to recognize the real world constraints that apply to the 
formulation of risk management measures.  The reality is that there are a limited number of 
approaches that can be taken to risk management for any given pest.  New Zealand has proposed no 
alternative measures for any of the pests that would meet Australia's ALOP.  Australia would ask that 
the Panel bear this in mind when considering how best to secure a positive solution to this dispute. 
(k) Conclusion 
4.514  In conclusion, Australia reaffirms its position that New Zealand has failed to establish any 
serious flaws in the risk assessments for fire blight, European canker and ALCM.  WT/DS367/R 
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 V. ARGUMENTS OF TH E THIRD PARTIES719 
A. CHILE 
1. Chile's written submission 
5.1 Chile expressed its interest in participating as a Third Party in this dispute, both as an exporter 
of apples and from a systemic viewpoint, as it consid ers strict compliance with  the disciplines of the 
WTO Agreement on the Application of Sanitary an d Phytosanitary Measures (SPS Agreement) to be 
crucial. 
5.2 The fundamental disciplines of the SPS Agreement include those set forth in Article 2.2, 
which stipulates that the sanitary and phytosanitary  measures applied by a Member must be based on 
scientific principles and maintained w ith sufficient scientific evidence.  It  is also vitally important that 
sanitary and phytosanitary measures be applied only to the extent necessary to protect human, animal 
or plant life or health. 
5.3 The foregoing lends support to the rule estab lished in Article 2.3, whereby such measures 
shall not be applied in a manner which would constitute a disguised restriction on trade. 
5.4 A second set of fundamental disciplines is set out  in Article 5 of the SPS Agreement, which 
provides that sanitary or phytosanitary measures sha ll be based on an assessment, as appropriate to the 
circumstances, of the risks.  Article 5 also regulates how Members must carry out such risk assessment and determine the appropriate level of san itary or phytosanitary protection.  In particular, 
Members are required, when determining the appropria te level of sanitary or phytosanitary protection, 
to take into account the objective of minimizing negative trade effects. 
5.5 Annex A to the SPS Agreement contains a precise definition of the concept of risk assessment 
and, as noted by New Zealand in paragraph 4.155 of  its First Written Submission, establishes a three-
pronged test to be applied by Members when assessing a risk.  Adherence to this definition and to the 
related test ensures proper compliance with Article 5.1 of the SPS Agreement. 
5.6 With regard to the scientific basis required for sanitary and phytosanitary measures, Chile 
believes that the Panel must follow the Appellate Body 's approach, in the sense that, for there to be a 
sufficient scientific basis, there must be a rationa l or objective relationship between the measure and 
the scientific evidence, and this will be determined in  the light of factors such as the characteristics of 
the measure and the quality of the scientific evidence. 
5.7 In this dispute, New Zealand contests the restric tions that have affected its exports of apples 
to the Australian market.  These restrictions stem  from the application of phytosanitary measures that 
have made it impossible for this product to enter Australia. 
5.8 Chile acknowledges the right claimed by Australia to determine its own level of protection as 
it deems appropriate, as provided for in the de finition in Annex A, paragraph 5, to the 
SPS Agreement.  Accordingly, as pointed out by Australia, neither the complaining party nor the Panel may substitute the criteria that the Import Ri sk Analysis (IRA) team took into consideration 
before applying the protective measure.  However, even  if Australia were to have such a right, this 
does not mean that it can impose measures at a level established at its own discretion.  Australia is, in 
particular, required to base its measure on the provi sions of Articles 2 and 5 of the SPS Agreement in 
                                                     
 
719 This section on the arguments of the Third Partie s is based on the executive summaries submitted by 
the Third Parties to the Panel. WT/DS367/R 
Page 152  
 
 respect of risk assessment and the rationale behind  the determination of an  appropriate level of 
protection. 
5.9 In the light of the foregoing, the phytosanitary measures contested by New Zealand must be 
based on scientific principles and applied in such a way as not to constitute a disguised restriction on 
trade.  It is therefore the responsibility of the Pa nel to examine whether Aust ralia, when assessing its 
risks and deciding on a certain level of protecti on, adhered to the above-mentioned requirements. 
5.10 Chile believes that, given the different and even  conflicting scientific opinions in this dispute 
in respect of the pests covered by Australia's risk  assessments (fire blight, European canker, and apple 
leafcurling midge), the Panel may have rec ourse to Article 11.2 of the SPS Agreement. 
5.11 With regard to the relevance in  this case of analysing the criteria or reasoning contained in the 
Panel and Appellate Body  reports relating to Japan – Apples (DS245) , Chile believes that the Panel 
must properly interpret the relevant Articles of the SPS Agreement, as stated in the reports concerning 
that dispute.  The foregoing does not, however, free the Panel from its obligation to make an objective 
assessment of the matter, as required under Article  11 of the Dispute Settlement Understanding 
(DSU).  Even though one of the pests in question is the same as in Japan – Apples (fire blight), the 
conditions in Australia may differ from those in Japan. 
5.12 That said, Chile agrees with New Zealand that th e criteria used to interpret the relevant rules 
of the SPS Agreement in Japan – Apples  must be applied in the same way in this dispute.  Chile 
considers it important to distinguish this situati on from others through the particular circumstances 
involved in the case, which must be determined by this Panel. 
5.13 Although Japan – Apples  presents similarities to this case, th e task of the current Panel is to 
study the Australian measures contained in the mandate given by the DSB, while taking into 
particular consideration the specific nature of the justification for these measures, in relation to the 
risks assessed in the light of the real circumstance s of the case at issue.  Only when the Panel has 
established the specific circumstances surrounding the Australian measure might it be useful to consider any criteria already used in Japan – Apples . 
5.14 Lastly, Chile would like to refer to the requi rements under Article 8 of the SPS Agreement.  
Members are required to observe the provisions of Annex C to the SPS Agreement in the operation of 
control, inspection and approval procedures.  The ru le stipulating that such procedures are to be 
undertaken and completed without undue delay is relevant in this respect .  In this case, the eight years 
it took the Australian authorities to complete the risk  assessment seems far too long and it is therefore 
of particular importance that the Panel rule on wh ether the procedure followed is consistent with the 
provisions mentioned. 
2. Chile's oral statement 
5.15 Chile appreciates this opportunity to provide the Panel with our views on this important 
dispute.  Although Chile does not have anything mo re to add to our written statement, Chile would 
like, briefly, to stress three points: 
5.16 First, Article 5.4 and 5.5 of the SPS Agreemen t establishes the principles contained in the 
determination of the appropriate level of sanitary or  phytosanitary protection, that is, the objective of 
minimizing negative trade effects and the avoidance of  arbitrary or unjustifiable distinctions in the 
levels Members consider to be appropriate in diffe rent situations, if such distinctions result in 
discrimination or a disguised restriction on international trade.  WT/DS367/R 
 Page 153 
 
 
 5.17 These elements must be taken into account by th e Panel in order to evaluate the Australian 
measures challenged by New Zealand.  In this regard , Chile would like to reiterate its suggestion that, 
as contemplated in Article 13.2 of the DSU, the Pa nel, in performing this task, seek information from 
any relevant source and consult experts to obtain th e opinion on the scientific elements comprised in 
this case. 
5.18 Second, regarding the undue delay claim under Ar ticle 8 and Annex C of the SPS Agreement, 
Chile reiterates its concern about the long time take n by the Australian authorities to complete its 
approval procedures for access to their market.  Such a long time of delay, as in the case of New Zealand apples, creates insurmountable barriers to the access of a product to a certain market. 
5.19 Finally, regarding Australia's request to the Panel to adopt a preliminary ruling concluding 
that New Zealand claim on undue delay of the IRA pro cess is outside the scope of this dispute, Chile 
is concerned about the insistence on discussing procedur al issues at this stage in this dispute, which, 
in Chile's opinion, affects the nature of the WTO di spute settlement mechanism, and in particular the 
prompt resolution of the substance of the case.  Li kewise, Chile understands that the claim related to 
Article 8 and Annex C of the SPS Agreement, is cove red by its request for a panel (WT/DS367/5).  In 
consequence, it is within the te rms of reference of the Panel. 
B. E
UROPEAN COMMUNITIES  
1. Executive summary of the European Communities' written submission 
(a) Introduction 
5.20 The European Communities sees international tr ade as a powerful means to increase States' 
and citizens' welfare on a global level.  However,  greater trade sometimes carries risks which may 
outweigh the possible benefits which countries and citizens may derive from it.  An appropriate 
balance must be found. 
5.21 Trade disputes concerning SPS measures raise deli cate issues insofar as  the imperatives of 
free commerce must be balanced ag ainst the legitimate right for countries to protect those public 
interests at the level their democratically elected bod ies consider appropriate.  In the light of this, the 
tasks conferred to the interpreter of the pertinent legal rules ought to be exercised with particular 
prudence and cautiousness. 
(b) Legal assessment 
(i) Articles 2.2 and 5.1 of the SPS Agreement 
5.22 As a preliminarily matter, the European Communities would like to stress it agrees with 
Australia that New Zealand has wrongly treated Articl es 2.2 and 5.1 as sources of distinct obligations.  
The European Communities notes that the Appellate Bo dy has already clarified that Articles 2.2 and 
5.1 of the SPS Agreement should be read constantly together .  In fact, Article 5.1 may be reviewed as 
a specific application of the basic obligations contained in Article 2.2 of the  SPS Agreement. 
5.23 Article 2.2 of the SPS Agreement sets out a ge neral rule requiring WTO Members to have 
"sufficient scientific evidence" as b asis for their SPS measures.  In Japan – Agricultural Products II,  
the Appellate Body has held that "sufficiency" is a "relational concept" which requires the existence 
of a sufficient or adequate re lationship between two elements, in casu , between the SPS measure and 
the scientific evidence, and having regard to the im porting Member's appropriate  level of protection. WT/DS367/R 
Page 154  
 
 5.24 According to Australia, this scientific evidence is  a risk assessment:  the Final IRA.  In the 
light of this, the Panel should, first of all, assess whether the Final IRA constitutes a risk assessment 
within the meaning of the SPS Agreement. 
5.25 The first clause of paragraph 4 of Annex A to the SPS Agreement defines the "risk 
assessment".  The Appellate Body, in Australia – Salmon , has clarified that the type risk of 
assessment relevant in the present dispute is composed  by a three step analysis.  The Panel must thus 
assess whether the Final IRA fulfils those require ments in the light of New Zealand's claims. 
5.26 In this regard, the Panel should firstly determ ine whether the Final IRA is so fundamentally 
flawed or biased that under no circumstances can it be considered as being supported by science.  
Secondly, the Panel should verify whether the Final IRA, for each pest, identifies some risk reduction 
measures and evaluates their relative effectiveness in  reducing the overall disease risk.  This bearing 
in mind that there is no obligation to assess all possible measures. 
5.27 Having concluded on whether the Final IRA is a risk analysis within the meaning of 
Article 5.1, the next step for the Panel would be to verify that the measures at issue are "based on" this 
risk assessment. 
5.28 The Panel should thus assess whether there is a reasonable or rational relationship between 
the Final IRA and the measures at issue.  Acco rdingly, it should examin e whether the Final IRA 
sufficiently warrants or reasonably s upports the measures at issue.  In this exercise, a sufficient degree 
of latitude should be given to Member's choices.  In fact, the expression "based on" should not be 
understood to mean that an SPS measure must  absolutely conform to the standard. 
(ii) Article 5.2 of the SPS Agreement 
5.29 Notably, Article 5.2 lists ( non-exhaustively) some factors that a WTO member conducting a 
risk assessment should take into account.  However,  this article does not provide for what weight, 
importance and relevance these factors must be given.   In the light of this, the European Communities 
believes that the Panel cannot find a breach of this  provision unless the member claiming the violation 
proves that the risk assessment did not take into account at all  those factors. 
(iii) Articles 5.5 and 2.3 of the SPS Agreement 
5.30 Preliminarily, it is appropriate to recall that the Appellate Body clarified the scope of this 
provision in EC – Hormones , when it stated that:  "[it] does not establish a legal obligation of 
consistency of appropriate levels of protection…  It is only arbitr ary or unjustifiable inconsistencies 
that are to be avoided." 
5.31 Further, in the same case the Appellate Body  added that a complaint of violation of 
Article 5.5 must show the presence of the following three distinct and cumulative elements.  In the 
first place, there must exist situations which can be  objectively compared.  The situations exhibiting 
differing levels of protection must thus present some  common element or elements sufficient to render 
them comparable.  In the second place, a certain difference in the treatment of those situations may not be conclusive on the breach of Article 5.5.  In fact, this difference of treatment must be so clear 
and so significant to amount to "arbitrary or unju stifiable inconsistency".  Finally, these differences 
must produce discrimination or a disguised restricti on of international trade.  In other words, the 
application of the measures at issue must either re sult in a different, and wo rse, treatment of some 
goods or constitute a hidden form of protectionism. 
5.32 In past disputes, the WTO judicial bodies have  often looked at "warning signals" and other 
additional factors which would hint at arbitrary or un justifiable distinctions.  In the light of the above,  WT/DS367/R 
 Page 155 
 
 
 the European Communities urges th is Panel to assess the warning signals and additional elements 
indicated by New Zealand with an appropriate de gree of prudence.  Only when several and clear 
signals point in one and the same direction should a pa nel conclude that a different treatment results in 
a discrimination or constitutes a disguised restriction of trade. 
5.33 With regard to Article 2.3, in the light of New Zealand's claims, it seems to the European 
Communities that whether the measures at issue are inconsistent with Article  2.3 depends only on the 
Panel's findings on Article 5.5. 
(iv) Article 5.6 of the SPS Agreement 
5.34 Footnote 3 to Article 5 explains that a nationa l measure is not inconsistent with Article 5.6 
unless there exists an alternative measure which m eets the following three cumulative conditions:  is 
reasonably available taking into account technical and economic feasibility;  achieves the appropriate 
level of sanitary or phytosanitary protection;  and is significantly less restrictive of trade. 
5.35 The fact that alternative measures must be "reasonably available" and "significantly less 
restrictive" implies that an appropriate degree of deference must be given to Members' choices of SPS 
measures.  The case-law makes it clear that it is fo r the complaining Member to make a prima facie 
case of violation of Article 5.6.  Accordingly, this  member has to suggest alternative measures which 
meet the three-pronged test mentioned above.  The application of this provision in past cases shows 
that Article 5.6 places a high evidentiary burden upon complaining Members. 
(v) Article 8 and Annex C(1)(a) of the SPS Agreement 
5.36 The European Communities wishes to point out th at the obligation to undertake and complete 
the procedures necessary to check and ensure th e fulfilment of SPS measures can be breached only 
when the length of these procedures appears, in li ght of all the evidence, scientific and otherwise, 
abnormal or excessive. 
5.37 The complaining Member has therefore to prove  that there have been significant delays 
without any objective or rational explanation.  In ot her words, it has to show that the process has been 
delayed either intentionally in order to have trade re strictions in place for a longer time, or because of 
evident and significant negligence on the part of the responsible authorities. 
5.38 The European Communities agrees wi th the Parties that it is not possible to draw in abstract 
terms from the provisions of Annex C(1)(a) a general obligation to decide within a shorter or longer 
period of time.  The European Communities considers that the Panel ought to be particularly cautious 
in its application of these provisions since procedures to assess risks to human, animal and plant life 
or health and possible counter-measures are notorio usly delicate, complex and time-consuming.  In 
particular, it is the SPS Agreement itself that, by imposing a certain number of steps and requirements 
for, and demanding that a certain number of elem ents be taken into account in, a risk assessment, 
necessarily implies longer time-periods where appropriate. 
(c) Conclusions 
5.39 Governments need to find an appropriate balance between trade and addressing their 
legitimate SPS concerns, including adopting measur es which appear necessary for the protection of 
human, animal or plant life or health.  The Europ ean Communities believes that the provisions of the 
SPS Agreement constitutes a set of well-balanced and wise rules that preserves the rights of WTO 
Members to adopt the SPS measures they consid er necessary while preventing hidden forms of 
protectionism. WT/DS367/R 
Page 156  
 
 5.40 The European Communities considers that these pr ovisions should equally be interpreted and 
applied in a balanced manner.  Indeed, an over-exten sive interpretation of the role of WTO judicial 
bodies in SPS disputes would risk to impinge upon th e role of national authorities when determining 
their ALOP.  On this point, th e European Communities largely agr ees with the legal considerations 
developed by Australia on the issue of the standard of review.  Therefore, the European Communities 
urges the Panel to be conscious of the scope a nd limits of the role attributed to it under the 
Understanding on rules and proce dures governing the settlement of disputes (the DSU) and the 
SPS Agreement. 
2. Executive summary of the European Communities' oral statement 
(a) Introduction 
5.41 The European Communities makes its third part y oral statement because of its systemic 
interest in the correct interpretation of the SPS Ag reement and, being a large producer, consumer and 
trader of apples, because of its substantial trad e interest in the present matter.  The European 
Communities stresses how the importance of this dispute goes well beyond the impact it may have on 
international trade in apples, since it raises various  interpretative issues on several key provisions of 
the SPS Agreement. 
(b) Australia's request for a ruling on New Zealand's claim of undue delay 
5.42 The European Communities has some doubts on th e correctness of Australia's arguments on 
this point.  New Zealand's panel request  asserts that the 17 measures listed are " both individually and 
as a whole  inconsistent with the obligations of Aust ralia under the SPS Agreement".  Challenging the 
alleged undue delay of the "IRA process" appears therefore to be tantamount to contesting the undue 
delay with respect to those 17 measures, at least as a whole.  In addition, the fact that the 17 measures 
are imposed and regulated by the Final IRA mean s that the alleged delay in undertaking and 
completing its approval inevitably and automatica lly affected the 17 measures duly identified by 
New Zealand in its panel request. 
5.43 Turning to the substance of the matter, the European Communities believes that, the 
necessary time is a function of the particular circ umstances, and as long as the necessary information 
is not forthcoming, the passage of time may (or may not) be justified.  The European Communities 
can easily envisage circumstances in which it may take  very many years to determine whether or not a 
given product meets the importing Member's acceptable level of protection.  The key point is that 
whether or not the passage of time is  justified can only be judged on the merits of the case  – and not 
on the basis of an assertion that at some random point in time the importing Member must adopt a 
final decision. 
(c) The role of amicus curiae  briefs 
5.44 The European Communities considers that the case- law developed so far by the WTO judicial 
bodies is sound and properly balances the different in terests mentioned above.  On the basis of this 
jurisprudence, it seems to the Eu ropean Communities that the presen t Panel has the authority to accept 
the submitted brief, and should decide whether to do  so on the basis of the potential pertinence and 
usefulness of such a document, and the extent to whic h the substance of the brief is taken up by either 
party in a timely manner. 
5.45
 Having reviewed this particular amicus curiae  brief, the European Communities doubts that it 
could be of any real assistance to the Panel.  Howeve r, should the Panel decide to accept this brief, the 
European Communities believes that  the facts and arguments set out therein should be taken into 
account by the Panel to the extent that Parties or  Third Parties decide to adopt the views expressed  WT/DS367/R 
 Page 157 
 
 
 therein in their own submissions and arguments to th e Panel, or are specifically given an opportunity 
to comment. 
(d) The use of experts in panel proceedings 
5.46 In the event that the Panel would decide that  there is a need to seek expert advice, the 
European Communities believes that it is imperative th at their role be clearly determined.  Experts' 
opinions should be confined to assess the scientific  evidence submitted by the Parties in order to 
determine whether that evidence is sound or plausible. It is neither the panel's nor the experts' role to 
engage in de novo  review of the evidence or to conduct their own risk assessments.  Similarly, if there 
exist different scientific opinions, or if there are scien tific questions that are yet to be resolved, that is 
a matter that a panel must take into consideration.  It is therefore crucial that panels bear in mind the 
proper role of experts when they formulate their questions to them. 
(e) The Panel's standard of review under the SPS Agreement 
5.47 The European Communities believes that Australia is quite right when it contends that "the 
standard of review should be informed by the part icular covered agreement(s) and obligation(s) at 
issue in a given dispute".  The European Communiti es recalls what the Appellate Body held on this 
point in EC – Hormones . 
5.48 An objective assessment of the matter before a panel means that this Panel must first of all 
determine what that matter actually is.  And, what that mater is depends necessarily on the provision(s) of the covered agreement(s) that the Pane l must interpret and apply in the case at hand.  It 
is these provisions which determine the scope and limits  of the Panel's role.  Different provisions of 
the covered agreements may grant the WTO judicial  bodies with a more stringent or more lenient 
power to review the contested national measure s.  The European Communities believes that, 
especially in disputes which concern the SPS Agreem ent such as the present one, it is absolutely 
crucial for the Panel to have a clear stance on the standard of review which should be followed.  A 
wrong standard of review would lead to a failure to conduct an objective assessment of the matter in 
breach of Article 11 of the DSU. 
(f) Conclusions 
5.49 The SPS Agreement , if properly interpreted and app lied, constitutes a well-balanced 
framework that preserves the rights of WTO memb ers to adopt the SPS measures they consider 
necessary while preventing hidden forms of protec tionism.  The European Communities urges the 
Panel to interpret and apply th e SPS Agreement with the same pr udence and cautiousness with which 
the WTO Members drafted it. 
C. J
APAN  
1. Executive summary of Japan's written submission 
(a) Introduction 
5.50 As a Third Party to this dispute, Japan would like to address, from a systematic viewpoint to 
ensure fair and objective application of the Agreement on the Application of Sanitary and 
Phytosanitary Measures agreements (hereinafter " SPS Agreement"), whether Australia's measures for 
the importation of New Zealand apples are inconsistent with its obligation under Articles 2.2, 5.1, 5.2, 
and 5.5 of the SPS Agreement. WT/DS367/R 
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 5.51 Many of the issues in this dispute relate to questions of facts on which Japan is not in a 
position to comment.  In fact, scientific knowledge has not been fully accumulated enough in Japan with regard to the pests at issu e, especially European canker and apple leafcurling midge.  Further, 
there is no case that could be dir ect reference to this case in resp ect to the countries, phytosanitary 
circumstances, risk assessment and other conditions .  New Zealand heavily relies on the conclusions 
in the Japan – Apples  case to support its argument and even argues that "conclusion of the DSB was 
directly applicable to the circumstances of New Zealand apples."
720  The Japan – Apples  case may be 
applicable to this case to some exte nt, but the case is not directly applicable to this case.  Japan, thus, 
limits its submission to issues of legal interpretation raised by some of the claims submitted by New Zealand. 
(b) Arguments 
(i) Consistency of the measures with  Article 2.2 of the SPS Agreement 
5.52 New Zealand submits that Australia's measur es are inconsistent with the obligation in 
Article 2.2 which creates an obligation for the Member to ensure that any SPS measures  are not 
maintained without sufficient evid ence.  New Zealand further argues that there is no "rational or 
objective relationship" between the measures im posed by Australia and scientific evidence. 
5.53 The Appellate Body addressed "whether ther e is a rational relationship between an SPS 
measure and the scientific evidence is to be de termined on a case-by-case basis and will depend upon 
the particular circumstances of the case, including th e characteristics of the measure at issue and the 
quality and quantity of the scientific evidence."
721 
5.54 Japan agrees to Australia's understanding that "s ufficiency" is a concept to be evaluated on a 
case-by-case basis, which requires specific scientif ic evidence on these pests.  However, Japan 
considers that not enough scientific  knowledge has been accumulated in Japan with regard to the pests 
at issue;722  therefore Japan would not comment on the question. 
(ii) Consistency of the measures with  Article 5.1 of the SPS Agreement 
5.55 New Zealand concludes that "Australia's breach of Article 2.2 in this case indicates that it is 
likely not to be in compliance with Article 5.1."723  In this regard, Japan recalls that both panels and 
the Appellate Body have made it clear that the b asic rights and obligations are provided in Article 2 
whereas more specific and detailed rights a nd obligations are articulated in Article 5.724  While it may 
be reasonable to presume that breach of Article 5.1 suggests breach of Article 2.2, it does not follow, as New Zealand argues, that breach of Article 2.2 indicates breach of Article 5.1.  Although Article 2.2 provides an important context in analyz ing the consistency of m easure under Article 5.1, 
obligations under these two provisions are distinct. 
5.56 Japan refrains from detailed argument as they la rgely depend on pertinent facts, but Japan 
nevertheless raises two points:  First, the qua ntitative method is one of the "well recognized"
725 means 
of risk assessment, as New Zealand admits.  Second, Jap an considers that even if the Panel finds that 
the quantitative approach is not sufficient to evalua te "likelihood", it does not necessarily lead to the 
                                                      
720 New Zealand's first writte n submission, para. 2.4. 
721 Appellate Body Report on Japan –Agricultural Products II , para.84. 
722 See para. 5.51 above. 
723 New Zealand's first writte n submission, para. 4.152. 
724 Appellate Body Report on EC – Hormones , para. 250;  Panel Report on Australia – Salmon , 
paras. 8.47-8.48. 
725 New Zealand's first writte n submission, para. 4.162.  WT/DS367/R 
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 conclusion that the IRA fails to evaluate "likeliho od" and does not constitute a risk assessment within 
the meaning of Article 5.1 a nd paragraph 4 of Annex A. 
(iii) Consistency of the measures with  Article 2.2 of the SPS Agreement 
5.57 New Zealand submits that Australia's measures  are inconsistent with  its obligations under 
Article 5.2.  As Australia points out, Japan submits  that New Zealand interprets the phrase "to take 
into account" to mean "to gi ve genuine consideration"726, although the latter phrase does not appear in 
Article 5.2 or any of the related provisions. 
5.58 Japan disagrees with the legal interpretation by New Zealand with regard to the phrase "taken 
into account" in Article 5.2.  Followi ng the interpretations by the panel727, Japan is of the view that the 
factors listed in Article 5.2 should be considered that a failure to respect  each and every aspect of 
these factors would not necessarily, per se , constitute a violation of Article 5.2. 
5.59 Japan agrees with Australia in that New Zeal and's interpretation that the factors listed in 
Article 5.2 must be "give[n] genuine consideration" may result in a situation, in this particular case, 
where Australia and the IRA Team should have agr eed with New Zealand's own view regarding the 
relevant technical factors.728 
(iv) Consistency of the measures with  Article 5.5 of the SPS Agreement 
5.60 With regard to its inconsistency with the obl igation of Article 5.5 of the SPS Agreement, 
New Zealand refers to the "measures" for Japanes e Nashi instead of its "level of protection".  
New Zealand argues that "the substantial difference in the sanitary measures applied by Australia" is 
"evidence of a clear difference in the level of protection applied".729 
5.61 Japan considers that a complainan t must establish that the respondent applies distinctions in 
the "levels" of protection in different situations, as the panel in Australia – Salmon  stated that 
"imposing the same sanitary measure for different situations does not necessarily result in the same 
level of protection."730  Japan is also of the view that to achieve a Member's appropriate "level of 
protection" "measures" need to be determined by  examining the "risks" with the importation of a 
particular product.  Additionally, the "risks " should be considered with the "situation." 
5.62 The above factors are interrelated and necessary fo r the argument of the level of protection.  
In this regard, Japan sees that New Zealand's argument is incomplete. 
(c) Conclusion 
5.63 Japan respectfully requests the Pa nel to examine carefully the facts presented by the Parties to 
this dispute in light of Japan's arguments above to ensure fair and objective application of the 
SPS Agreement. 
2. Japan's oral statement 
5.64 Japan appreciates this opportunity to present its view s in this dispute.  At this meeting, Japan 
will not repeat its arguments set out in its written s ubmission.  Rather, Japan would like to make a few 
                                                      
726 New Zealand's first writte n submission, para. 4.411. 
727 Panel Report on Japan –Apples , para. 8.241. 
728 Australia's first written submission, para. 879. 
729 New Zealand's first written submi ssion, paras. 4.439 and 4.443. 
730 Panel Report on Australia – Salmon , para. 8.123. WT/DS367/R 
Page 160  
 
 observations on general points that Japan considers to be  relevant for the Panel to take into account in 
disposing the case at hand. 
(a) Determination of the appropriate  level of protection in the SPS Agreement as a "prerogative" 
of a WTO Member 
5.65 According to the definition set forth in para graph 5 of Annex A of the SPS Agreement, a 
WTO Member has the sole authority to determine the appropriate level of sanitary or phytosanitary 
protection it considers appropriate to protect human, an imal or plant life or health within its territory.  
In the words of the Appellate Body, "the determina tion of the appropriate level of protection, a notion 
defined in paragraph 5 of  Annex A, as 'the level of protecti on deemed appropriate by the Member 
establishing a sanitary … measure', is a prerogative  of the Member concerned".
731  This is also 
confirmed in the preamble of SPS Agreement whic h states that the use of harmonized sanitary and 
phytosanitary measures is desired "without requiring  Members to change their appropriate level of 
protection …" 
5.66 This Members' prerogative is not limitless;  it is subject to certain constraints set forth in, for 
instance, Article 5.4 and 5.5, which recognize the needs to minimize negativ e trade effects and to 
avoid arbitrary or unjustifiable distinction in the leve ls of protection in different situations that would 
results in discrimination or a disguised trade r estriction.  This suggests that the SPS Agreement 
recognizes a delicate balance between the negative effects on trade that the SPS measures may have 
and the need to protect human life or health, or to an imal and plant life or health.  In other words, in 
Japan's view, the SPS Agreement embodies WTO Me mbers' recognition that a proper and delicate 
balance be struck and thus maintained between the legitimate rights of member to determine the 
appropriate level of protection against risks to human, animal and plant life and health, "that 
determines the SPS measures"732, on the one hand, and the duty of th e same member to ensure that its 
SPS measures be less trade restrictive, on the other hand. 
5.67 Therefore, Japan would like to request the Pane l to pay due regard to such delicate balance 
recognized in the SPS Agreement in examining the issues before it in this proceeding. 
(b) Burden of proof 
5.68 With regard to the allocation of burden of pr oof in proceedings under the SPS Agreement, the 
Appellate Body agreed with the panel below in EC – Hormones  that this issue is one "of particular 
importance, in view of the nature of disputes under [the SPS] Agreement" because "[s]uch disputes 
may raise multiple and complex issues of fact".  The Appellate Body furt her approvingly described 
the panel's ruling that "[t]he initial burden lies on the complaining party, which must establish a prima 
facie case of inconsistency with a particular pr ovision of the SPS Agreement on the part of the 
defending party, or more precisely, of its  SPS measure or measures complained about."733 
5.69 According to this allocation of the bur den of proof in the proceeding under the 
SPS Agreement, Japan considers that in this case th e Panel should begin its analysis by examining 
whether New Zealand has "presented evidence a nd legal arguments sufficient to demonstrate"734 that 
Australia's measures at issue are inconsistent with the provisions of the SPS Agreement cited in the 
Panel request.  In other words, the initial question before the Panel is whether New Zealand has made 
out a prima facie case by satisfying its evidentially and legal burden of proof in respect of claims it 
has advanced.  "Only after such a prima facie dete rmination ha[s] been made by the Panel may the 
                                                      
731 Appellate Body Report on Australia – Salmon , para. 199. 
732 Appellate Body Report on Australia – Salmon , para. 203. 
733 Appellate Body Report on EC – Hormones , paras. 97-98. 
734 Appellate Body Report on EC – Hormones , para. 109.  WT/DS367/R 
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 onus be shifted to" Australia "to bring forward ev idence and arguments to disprove the complaining 
party's claim".735 
5.70 Taking as an example New Zealand's claim that Australia's measures are inconsistent with 
Article 5.6, Japan agrees with the European Comm unities that "it is for the complaining Member to 
make a prima facie case of violation of Article 5.6".736  Specifically, New Zealand must prove that 
there is an alternative SPS measure which (1) is reasonable available for Australia, (2) achieves the 
appropriate level of sanitary or phytosanitary prot ection of Australia, and (3) is significantly less 
restrictive than the contested measure. 
5.71 Japan would like to stress again that the allo cation of burden of proof  is important in the 
proceedings under the  SPS Agreement. 
D. CHINESE TAIPEI  
1. Executive summary of Chinese Taipei's written submission 
(a) Introduction 
5.72 The Separate Customs Territory of Taiwan, Pe nghu, Kinmen and Matsu (hereinafter referred 
to as "Chinese Taipei"), as a Third Party in this  proceeding, makes this Third Party submission 
because of its interest in the correct interpre tation and application of the Agreement on the 
Application of Sanitary and Phytosanitary Measur es (the "SPS Agreement").  In addition, as an 
importer of Australian and New Zealand apples, Chinese Taipei has a substantial trade interest in the 
dispute before the Panel. 
5.73 This submission will address the following issues: 
(a) Application of the "necessity" test to Australia's contested measures; and 
(b) whether Australia's appropriate levels of protection between New Zealand apples and 
Japanese pears are comparable. 
(b) Legal arguments 
(i) Application of "necessity" test to Australia's SPS measures 
Substantive requirements of the "n ecessity" test in the SPS Agreement  
5.74 In examining whether a measure satisfies the "n ecessity" test, according to the structure of 
Article 2.2 of the SPS Agreement, in Chinese Taipei 's view, three elements should be established:  
(1) the measure at issue is a sanita ry or phytosanitary ("SPS") measure;  (2) the objective is to protect 
human, animal or plant life or health;  and (3) impl ementation of the measure is necessary to achieve 
the objective. 
5.75 Chinese Taipei notes that in Australia – Salmon  and Japan – Agricultural Products II , a 
three-pronged test was established by the Appellate  Body to determine "necessity" as defined in 
Article 5.6 and Footnote 3 of the SPS Agreem ent, i.e., any given SPS measure must: 
(a) Be available taking into account technical and economic feasibility; 
                                                      
735 Appellate Body Report on EC – Hormones , para. 109. 
736 European Communities' Third Party submission, paras. 64-69. WT/DS367/R 
Page 162  
 
 (b) achieve the Member's appropriate  level of SPS protection;  and 
(c) be significantly less trade restrictive than the SPS measure being contested. 
The three elements are cumulative in the sen se that all of them have to be met. 
 
Australia's contested measures must satisfy th e three-pronged test to establish their necessity
 
5.76 While there is no international standard, gui deline, or recommendation addressing the three 
diseases in this dispute, Article 5.6 of the SPS Ag reement and the aforementioned three-pronged test 
should serve as baselines in determining whether Australia's measures are "necessary" to protect 
human, animal or plant life or health.  Accordingl y, Chinese Taipei suggests that the Panel carefully 
consider whether the alternative measures rai sed by New Zealand would satisfy Australia's SPS 
requirements. 
(ii) Whether Australia's appropriate levels of protection between New Zealand apples and 
Japanese pears are comparable 
Determination of Appropr iate Level of Protection in the SPS Agreement  
5.77 In EC – Hormones , the Appellate Body concluded that absolute or perfect consistency of 
appropriate level of protection ("ALOP") is not a legal obligation, since Members revise their ALOPs 
frequently on an ad hoc  basis and over time, as different risks present themselves.  This indicates that 
Members, instead of a panel or the Appellate Body, have authority to determine their own ALOPs. 
5.78 Whereas the Appellate Body in  EC – Hormones  focused on Members' authority , the 
Appellate Body in Australia – Salmon  determined rather that Members have implicit obligations  to 
comply with their own ALOPs. 
5.79 Given these possibilities, Chinese Taipei believ es that WTO Members should be granted the 
authority to determine their own ALOPs.  At the sam e time, Members should not be free to act in this 
respect without any constraint.  Article 5.5 imposes restrictions on Members' authority in establishing 
their ALOPs, in order to guard against arbitrary or unjustifiable discrimination or a disguised restriction on international trade.  Furthermore, this Article also ensures that SPS measures are not 
established or maintained in a manner that is more  trade-restrictive than necessary, taking into account 
technical and economic feasibility. 
Distinction between appropriate levels of protection can be made only in comparable
 
situations  
5.80 In the present dispute, New Zealand claims th at Japanese pears, which may bring equivalent 
or higher risks of Japanese Erwinia  and brown rot, are subject to less trade-restrictive measures.  
While Japanese Erwinia  is similar to Erwinia amylovara  (fire blight), and brown rot also has 
similarities to European canker, Australia applie s different ALOPs to the import of its apples 
compared to Japanese pears.  As  a result, Australia's contested measures constitute arbitrary or 
unjustifiable discrimination or a disguised restriction on international trade. 
5.81 In EC – Hormones , the Appellate Body stated that three elements should be met cumulatively 
before claiming a violation of Article 5.5 of the SPS Agreement.  They are: 
(a) That a Member imposing a measure that results in a dispute with one or more other 
Members has adopted its own levels of sanita ry protection against risks to human life 
or health in several different situations;  WT/DS367/R 
 Page 163 
 
 
 (b) that the levels of protection exhibit arbitr ary or unjustifiable differences in their 
treatment of different situations; and 
(c) that the arbitrary or unjustifiable differences result in discrimination or a disguised 
restriction of international trade. 
5.82 For the first element the Appellate Body stated in the EC – Hormones  that different situations 
in which Members have exhibited varying levels  of protection cannot be compared unless they 
present some common element or elements sufficien t to render them comparable.  Thus, mere 
differences in levels of protection cannot be used  as a basis for determining arbitrariness in the 
measure in question.  In examining the "comparab ility" of different situa tions, the Appellate Body 
stated, in Australia – Salmon , that such common elements are pre sent where situations involve a risk 
of entry, establishment or spread of the same or a similar  disease, or where situations involve a risk of 
the same or similar  associated potential biological and economic  consequences.  In short, categorizing 
risks or situations as similar  requires a comparison of both the relevant likelihood and the 
corresponding consequences cau sed by similar diseases. 
5.83 Chinese Taipei agrees that with the objective of  achieving consistency in the application of 
the ALOP, Members should establish equivalent or similar  ALOPs in situations that involve a risk of 
entry, establishment or spread of the same or a similar  disease, or that involve a risk of the same or 
similar  associated potential biological and economic c onsequences.  On the other hand, diseases or 
their associated biological and economic consequen ces at issue must be shown to be the same or 
similar  before any further analysis of potential viola tion of Article 5.5 of the SPS Agreement.  If the 
different situations involving apples from New Zeal and and Japanese pears are not comparable, it is 
inappropriate to use the differences between the ALOPs set up by Australia for New Zealand apples 
and for Japanese pears as a means of establishing arbitrary or unjustifiable discrimination or a disguised restriction on international trade. 
5.84 Accordingly, in Chinese Taipei's view, comp arability should be the prerequisite for 
examining any possible breach of Article 5.5, and it would be of systemic benefit to establish criteria 
for determining disease comparability. 
(c) Conclusion 
5.85 Whether Australia's measures violate Article 2.2 and 5.6 of the SPS Agreement depends on 
whether the contested measures are applied to the ex tent necessary to protect human, animal or plant 
life or health.  That is, if an alternative measure able to achieve Australia's ALOP does exist and is 
both less trade-restrictive and technically and economi cally feasible, then the legitimacy of Australia's 
contested measures will be undermined. 
5.86 As to whether the ALOPs established by Aust ralia between New Zealand apples and Japanese 
pears results in arbitrary or unjustifiable discrimin ation or a disguised restriction on international 
trade, the first step is to determine whether the situations are identical or similar  enough to be 
comparable.  It is Chinese Taipei's viewpoint that there would be systemic benefit in establishing 
criteria to determine similarities  in this dispute. 
5.87 Chinese Taipei notes that both Parties to the dis pute referred to Chinese Taipei with respect to 
the existence of the pest at issue and its rele vant SPS regulatory regimes.  Chinese Taipei has 
provided some factual information in the Supplemen tary Information attached to its Submission for 
the Panel's reference. 
5.88 Chinese Taipei respectfully requests the Panel to  take into account the above observations and 
comments in its deliberations, and hope the Panel will find the views helpful. WT/DS367/R 
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 2. Chinese Taipei's oral statement 
5.89 At the Panel's meeting with Third Parties, Ch inese Taipei reiterated the arguments contained 
in its written submission. 
E. U
NITED STATES  
1. Executive summary of the United States' written submission 
(a) Introduction 
5.90 The United States welcomes the opportunity to pr ovide the Panel with its views in this 
dispute, in which New Zealand challenges Australia 's imposition of phytosanitary measures for the 
importation of its apples under the Agreement on th e Application of Sanitary and Phytosanitary 
Measures ("SPS Agreement").  As the Panel is awar e, the United States was the complaining party in 
Japan – Apples , a dispute that dealt with fire blight rest rictions imposed by Japan for the importation 
of US apples.  In light of that experience, the United States considers it appropriate to offer its views on the scientific evidence and the merits of some of New Zealand's claims, particularly in relation to 
fire blight.  The United States, as a major agricultu ral exporter and importer, has a strong interest in 
the proper interpretation and application of the SPS Agreement. 
(b) The Panel should make an objective assessment of the matter before it pursuant to Article 11 
of the DSU 
5.91 In the view of the United States, Australia h as failed to correctly set forth the applicable 
standard of review in this dispute.  Australia ma intains that the Panel should provide it "considerable 
deference" in assessing the scientific basis of san itary and phytosanitary ("SPS") measures evaluated 
in its risk assessment.  But such an interpretation does not comport with Article 11 of the 
Understanding on Rules and Procedures Governing the Settlement of Disputes ("DSU"), which 
requires a panel to make "an objective assessment of the facts". 
5.92 The United States considers that a panel's oblig ation to make "an objective assessment of the 
facts" pursuant to Article 11 of the DSU is also im portant to understanding the relevance of reports by 
prior panels and the Appellate Body.  The United Stat es is of the view that adopted reports by prior 
panels and the Appellate Body should be considered for their persuasiveness, but they are not binding 
on subsequent panels and need not be followed. 
(c) Article 2.2 of the SPS Agreement requires sufficient scientific evidence 
5.93 The obligation in Article 2.2 not to maintain  an SPS measure "without sufficient scientific 
evidence" requires that there be a rational or ob jective relationship between the SPS measure and the 
scientific evidence. 
5.94 As was also the case during Japan – Apples , there is still no scientifi c evidence that mature, 
symptomless apples transmit fire blight disease.  The scientific evidence further demonstrates that 
apples are not a pathway for the disease.  And Australia has provided no scientific evidence 
establishing either that mature, symptomless apples transmit fire blight disease or that they are a pathway for disease.  Accordingly, the United States considers that the measures for fire blight that 
Australia imposes on apples from New Zealand are ma intained without suffici ent scientific evidence, 
in violation of Article 2.2 of the SPS Agreement. 
5.95 The vast scientific literature on fire blight est ablishes that mature, symptomless apples have 
never transmitted fire blight, nor do they play a role in the transmission of the disease.  Two important  WT/DS367/R 
 Page 165 
 
 
 studies conducted a critical review of all published data on the presence of Erwinia amylovora  (fire 
blight bacteria) on or in mature, export-quality ap ples and estimated the theoretical probability of 
transmission of the disease via those fruit.   The first study, published by Roberts et al. in 1998, 
estimated the risk of establishing new outbreaks of fire blight in previously blight-free areas, and 
found this risk to be so small as to be insigni ficant.  The second study, published by Roberts and 
Sawyer in 2008, updates the Roberts et al.  1998 study and estimates that the probability of an 
outbreak of fire blight due to trade in export-qualit y apple fruit was dramatically lower than originally 
projected in the 1998 study.  Australia attempts to  discredit this comprehensive and significant 2008 
study because it contradicts the findings of Australia' s risk assessment.  But Australia's contentions 
lack merit. 
5.96 Three key factors are necessary for the infecti on of apple fruit with European canker:  
(1) conducive climatic conditions;  (2) the presen ce of a susceptible host;  and (3) a sufficient 
concentration of inoculum.  Fav ourable occurrence of all three of these factors is necessary for 
infection of apple fruit to occur.  In light of these three factors, and the US knowledge of the disease, 
the United States does not consider that Australia  has adduced sufficient scientific evidence to 
establish that apples will be latently infected w ith European canker and can transfer the disease to 
susceptible hosts. 
5.97 In Australia's discussion of apple leafcurling midge (ALCM), it notes that the United States 
has a regulatory programme in place for the export of apples from New Zealand to the United States.  
The United States makes one point of clarificati on regarding this regulatory programme.  The 
US inspection levels used for apples from New Ze aland are not targeted to ALCM, but a different 
pest – light brown apple moth. 
(d) Article 5.1 requires that SPS measures be based on a risk assessment 
5.98 Article 5.1 of the SPS Agreement 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 plant life or health, taking in to account risk assessment techniques developed by 
the relevant international organizations".  The Unit ed States has concerns with Australia's "Final 
Import Risk Analysis for Apples from New Zealand"  ("IRA") relating to both Australia's general 
methodology and its evaluation of the scientific evidence,  particularly with respect to fire blight and 
European canker.  Australia has not been consis tent regarding its methodological approach with 
respect to its use of a semi-quantitative model – both within the IRA and in other risk assessments that 
it has conducted for other products.  The United Stat es has previously explained its concerns to 
Australia in comments that it submitted on a draft IRA published by Australia. 
5.99 Australia's use of a semi-quantitative model for fi re blight and European canker contributed to 
a flawed risk assessment.  For fire blight, this is evidenced by the various va lues that Australia assigns 
to different steps in its analysis.  In several inst ances, Australia extrapolates values for risk levels in 
the absence of, or contrary to, the scientific evid ence.  For European canker, among other concerns, 
the United States considers that the transfer scenar io of the disease set forth in the IRA from mature, 
export quality apples is highly unlikely.  And for both  fire blight and European canker, Australia has 
not evaluated the likelihood of entry, establishmen t, and spread of the diseases according to the SPS 
measures that might be applied. 
(e) Arbitrary or unjustifiable distinctions in  the level of protection under Article 5.5 
5.100  In understanding Article 5.5, the United States considers it important to recognize that the 
SPS Agreement allows each Member to establish it s own appropriate level of protection and that 
Article 5.5 does not prohibit a Member from having different appropriate le vels of protection in 
different situations. WT/DS367/R 
Page 166  
 
 (f) Article 5.6 requires that SPS measures not be more trade restrictive than necessary to meet a 
Member's appropriate level of protection 
5.101  The United States considers that there is an a lternative measure for fire blight that is 
reasonably available, achieves Australia's appropria te level of protection, and is significantly less 
restrictive to trade than Australia's fire bli ght measures:  restricting importation to mature, 
symptomless apple fruit.  This measure follows fro m the scientific evidence that mature, symptomless 
apple fruit are not a pathway for the disease and thus will not result in transmission of fire blight to 
Australia.  In the absence of an y evidence that mature, symptomless apples transmit the disease, the 
United States submits that Australia has imposed fire  blight measures that are more trade-restrictive 
than required to achieve its a ppropriate level of protection. 
(g) Undue delay under Artic le 8 and Annex C 
5.102  Article 8 of the SPS Agreement provides that "Members shall observe the provisions of 
Annex C in the operation of control, inspection, and approval procedures", and paragraph 1(a) of 
Annex C states that "Members shall ensure, with r espect 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."  The United Stat es shares New Zealand's concerns about undue 
delay by Australia regarding its import risk assessments for foreign apples.  As Australia has done 
with apples from New Zealand, it continues to bl ock access to its market for US apples due to 
longstanding quarantine restrictions.  The United St ates suffered a long delay in the commencement 
of a risk assessment for US apples, which was further compounded by the lengthy delays in 
Australia's IRA for apples from New Zealand. 
2. Executive summary of the United States' oral statement 
5.103  The United States would like to provide a short summary of some of the key issues addressed 
in our Third-Party written submission and make a few brief points on the following topics raised in other third-party submissions:  (1) the standard of re view for a claim relating to whether there is a risk 
assessment within the meaning of Article 5.1 of the Agreement on the Application of Sanitary and 
Phytosanitary Measures ("SPS Agreement");  (2) the proper interpretation of Article 5.2;  (3) the 
"necessity" of a measure under Articles 2.2 and 5. 6;  and (4) undue dela y under Article 8 and 
Annex C. 
(a) Key issues in the US written submission 
5.104  The US third party submission focused on New Ze aland's claims under Articles 2.2 and 5.1 of 
the SPS Agreement.  The United States agrees with Ne w Zealand that Australia's fire blight measures 
are inconsistent with Article 2.2 because there is  no scientific evidence that mature, symptomless 
apples transmit fire blight disease.  Mature, sympto mless apples are not a pathway for fire blight 
disease.  As for European canker, the United States si milarly concurs with New Zealand that Australia 
has not adduced sufficient scientific ev idence to establish that apples will be latently infected with the 
disease and can then transfer it to susceptible hos ts in Australia.  In terms of New Zealand's 
Article 5.1 claims, the United States also has con cerns regarding Australia's risk assessment, relating 
both to its general methodology and its evaluation of  the scientific ev idence.  Australia's use of a 
semi-quantitative model for its risk  assessment for fire blight and Eu ropean canker contributed to a 
flawed risk assessment.  For fire blight, Australia's  risk assessment often extrapolates values for risk 
levels in the absence of, or contrary to, scientific evidence.
737  For European canker, the transfer 
                                                      
737 United States' Third Party submission, paras. 63-72.  WT/DS367/R 
 Page 167 
 
 
 scenario for the disease set forth in Australia's ri sk assessment for mature, export-quality apples is 
highly unlikely.738 
(b) Standard of review for a risk assessment under Article 5.1 
5.105  The European Communities ("EC") argue in thei r written submission that the proper role of 
the Panel in reviewing Australia's risk assessment is  to determine whether the risk assessment is "so 
fundamentally flawed or biased that under no circ umstances can it be considered as being supported 
by science."739  By taking this position, the EC, like Australia, advocates an extremely deferential 
standard of review for risk assessments conducted purs uant to Article 5.1.  But as explained in the US 
written submission in response to a similar argument by  Australia, this deferent ial standard of review 
is not correct.740 
5.106  Article 11 of the Understanding on Rules a nd Procedures Governing the Settlement of 
Disputes ("DSU") provides the applicable standard  of review for panels in disputes under WTO 
covered agreements, including the SPS Agreement.  Article 11 requires a panel to "make an objective 
assessment of the facts of  the case and the applicability of and co nformity with the relevant covered 
agreements."  Thus, the proper role of the Panel in this dispute is to make an objective assessment of 
whether Australia's measures are "based on" a risk assessment, including whether the scientific 
evidence presented in Australia's risk assessment supports the conc lusions of that risk assessment. 
(c) The proper interpretation of Article 5.2 
5.107  Article 5.2 requires that a risk assessment must  "take into account" certa in factors, such as 
available scientific evidence and relevant processes and production methods.  Australia argues that 
New Zealand incorrectly interprets the phrase "t ake into account" as meaning to "give genuine 
consideration" to the factors enumerated in Article 5.2, and Japan concurs.741  The EC submits that 
Article 5.2 is not breached unless the complaining pa rty "proves that the risk assessment did not take 
into account at all those factors"742 (italics added).  But the phrase "to take into account" is not 
qualified in the manner stated by the EC. 
5.108  Further, both Australia and New Zealand ha ve cited the panel report in the dispute US – 
Continued Suspension  for that panel's interpretation of Article  5.2 and the phrase "take into account".  
There, the panel explained that "taking available scientific evidence into account does not require that 
a Member conform its actions to a particular conclu sion in a particular scientific study".  The panel 
further stated that "the requirement in Article 5.2 is to ensure that a Member, when assessing risk with 
the aim of formulating an appropriate SPS measure, has as wide a range as possible of scientific information before it to ensure that its measure s will be based on sufficient scientific data and 
supported by scientific principles".
743 
5.109  The United States agrees with both Parties th at the Panel should consider the panel's 
interpretation in US – Continued Suspension  in formulating its views on Article 5.2 and whether 
Australia has properly taken into account the factors lis ted in Article 5.2.  The United States also notes 
that the aforementioned dispute is currently on appe al, and the Appellate Body is scheduled to issue 
its report on October 16, 2008.  Thus, the Panel w ill have the benefit of any articulation by the 
Appellate Body of its understanding of Article  5.2 prior to resolving this dispute. 
                                                      
738 United States' Third Party submission, para. 76. 
739 European Communities' Third Party submission, para. 30. 
740 United States' Third Party submission, paras. 3-8. 
741 Japan's Third Party submission, paras. 17-21. 
742 European Communities' Third Party submission, para. 51. 
743 Panel Report on US – Continued Suspension , para. 7.480. WT/DS367/R 
Page 168  
 
 (d) The "necessity" of a measure under Articles 2.2 and 5.6 
5.110  The United States now turns to an issue raised by the Separate Customs Territory of Taiwan, 
Penghu, Kinmen, and Matsu ("Chinese Taipei") rega rding whether an SPS measu re is "necessary" to 
protect human, animal, or plant life or health under Article 2.2 and the relationship between 
Articles 2.2 and 5.6.  Chinese Taipei submits that in  the absence of international standards, guidelines, 
or recommendations, Article 5.6 should be used to determine whether a SPS measure is necessary, as 
required by Article 2.2.
744  The United States believes that in th is dispute, the Panel need not make 
findings on the precise relationship between Articles 2.2 and 5.6. 
5.111  Rather, because New Zealand has made specifi c claims under Article 5.6, the Panel can 
simply address those claims.  This is particularly true because New Zealand's Article 2.2 claims 
primarily relate to whether Australia's measures ar e maintained without suffi cient scientific evidence 
and not whether they are necessary for the protection of human, animal, or plant life or health.  New Zealand's arguments regarding the necessity of Au stralia's measures are made with respect to its 
claims under Article 5.1 and 5.6.
745 
(e) Undue delay under Artic le 8 and Annex C 
5.112  The United States also would like to address an  issue of undue delay under Article 8 and 
Annex C raised by the European Communities.  The European Communities states that it is not 
possible to draw from Annex C, paragraph 1(a), a general time frame for deciding on procedures to 
check and ensure the fulfilment of SPS measures.  The European Communities then asserts that the 
justified time period could be quite  lengthy, extending "to many years or even decades" depending on 
the "exporter's anticipated profits".746  But an "exporter's anticipated profits" should have no bearing 
on whether procedures to check and ensure th e fulfilment of SPS measures are undertaken and 
completed without undue delay.  Such profits anticipated by exporters in no way affect a Member's  
ability to proceed with its procedures " as promptly as possible," as the panel in EC – Approval and 
Marketing of Biotech Products considered necessary.747 
(f) Conclusion 
5.113  Finally, in Australia's oral statement, it allege d that there were "serious flaws" in the United 
States' Third-Party submission and stated that it would address these flaws in subsequent stages of the dispute.  Of course, the United States would not have an opportunity to comment or correct any errors in its submission in subsequent stages.  The Un ited States would like to suggest an alternative 
approach:  Australia could pose questions to the Unit ed States on those "serious flaws" in the United 
States' submission so that the United States could provi de clarifications or corrections.  This could be 
of assistance to both of the Parties and to the Pane l in its efforts to produce a high-quality panel report 
as set out in Article 12.2 of the DSU. 
VI. INTERIM REVIEW 
6.1 The Panel issued its interim report to the Pa rties on 31 March 2010.  On 15 April, in 
accordance with Article 15 of th e Dispute Settlement Understanding (DSU) and paragraph 14 of the 
Panel's Working Procedures, New Zealand and Au stralia submitted written comments and requested 
the Panel to revise precise aspects of the interim report.  On 22 April, New Zealand and Australia 
                                                     
 
744 Chinese Taipei's Third Party submission, para. 17. 
745 New Zealand's first writte n submission, para. 4.6. 
746 European Communities' Third Party submission, para. 75. 
747 EC – Approval and Marketing of Biotech Products , para. 7.1498.  WT/DS367/R 
 Page 169 
 
 
 submitted written comments on each other's comments a nd requests for interim review.  Neither Party 
requested an interim review meeting with the Panel. 
6.2 Where appropriate, the Panel has modified certain aspects of its interim report, in the light of 
the Parties' comments and requests, as explained be low.  The Panel has also made certain revisions 
and corrections for the purposes of clarity and accuracy.  Section VI of this report summarizes these 
changes.  References to paragra ph numbers and footnote numbers used in Section VI of the report are 
to those in the interim report, except as otherwise noted. 
A. INTERIM REVIEW CHANGES TO DESCRIPTIVE PART 
1. Description of Panel proceedings 
6.3 Australia requests that paragraphs 1.35 and 1.36 of  the interim report be modified to include a 
reference to "the delays in providing draft questions  to the Parties for comment or the time given to 
comment them".748  Paragraphs 1.41 to 1.43 of the interim report described the delays in the timetable 
as a result of the Panel's difficulties in identifying available experts and prep aring written questions.  
New language has been added into paragraph 1.43 to note the Panel's additional delay in providing the 
proposed questions for the experts to the Parties.  The Panel notes that Parties were always kept 
informed of the delays and consulted about all modi fications to the timetable.  At no time in the 
proceedings did either of the Parties express con cerns regarding the delay in receiving the proposed 
questions or the time given to comment on them.  In  particular, no such concern was expressed when, 
on 11 November 2008, the Panel consulted the Parti es on the need to revise the timetable, nor when 
the proposed questions were sent to Parties on 15 December 2008, nor, finally, when Parties 
submitted their comments on the proposed questions on 19 December 2008. 
6.4 Australia also requests that paragraph 1.40 of th e interim report be modified to note that, in its 
letter of 19 December 2008, Australia had "raised c oncerns regarding aspects of the draft guidelines 
for the experts and a range of the draft questions to them".749  The fact that both Parties commented on 
19 December 2008 on the proposed questions for the e xperts is already noted in paragraph 1.36 of the 
report.  Additional language has been added to para graph 1.40 to note that some of the procedural 
concerns regarding the expert consultation pro cess were raised by Australia on 19 December 2008, 
when providing its comments on the Panel's proposed questions to the experts, although at the time 
those concerns were not qualified by Australia as "due process concerns". 
2. Pests at issue 
6.5 Australia requests an amendment to paragra ph 2.12, "to ensure that the pathology of 
European canker is accurately represented in the Panel report".750  New Zealand rejects the request.  In 
New Zealand's view, the Panel's statement "is a gene ral one that holds true for any host plant tissue 
susceptible to N. galligena  (including fruit)".751  To address Australia's request, the Panel has inserted 
                                                      
748 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 3. 
749 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 4. 
750 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 7. 
751 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 6. WT/DS367/R 
Page 170  
 
 additional language in paragraph 2.12, using te xt from Swinburne (1975)
752, the relevant reference in 
the IRA.753 
6.6 Australia requests that the Panel provide details  of the potential consequences of the entry, 
establishment and spread of the pests at  issue in paragraphs 2.1 to 2.25.754  New Zealand rejects the 
request.  In New Zealand's view, the consequences fo r the relevant pests are a contested issue and it 
would not be appropriate to include this aspect in the factual section of the report.755  A description of 
the relevant sections in the IRA's discussion regarding the potential biological and economic 
consequences associated with the entry, establishment and spread of  the pests at issue is already 
included in the relevant sections of the report.756  Accordingly, the Panel sees no reason to modify 
paragraphs 2.1 to 2.25 in this respect. 
3. Previous risk assessment 
6.7 Australia requests an amendment to paragraph 2.31, to better reflect the chronology of the 
adoption of the IRA.757  New Zealand rejects the request.  In New Zealand's view, the chronology is 
accurate.758  The Panel has amended paragr aphs 2.30 and 2.31 to better reflect that an earlier risk 
assessment had been initiated by the Australian Qu arantine and Inspection Service (AQIS) in 1996 
and released in 1998. 
B. INTERIM REVIEW CHANGES TO THE FINDINGS SECTION  
1. Experts' selection and consultation process 
6.8 Australia requests an amendment to paragraph 7.3, to include its concern regarding "the 
Panel's use of the experts in areas that were outsi de the field of expertise for which they were 
appointed and on which the parties were consulted" .  This concern would have been flagged by 
Australia in its comments on the experts' replies to  questions and would have  been different from the 
separate concern regarding "the experts' alleged lack of competence in certain areas in which the Panel posed questions or the experts expressed opinions".
759  New Zealand requests that, if the 
category of concerns identified by Australia is noted, in accordance with th e reference provided by 
Australia it should omit the expression "on which the parties were consulted", which is not present in 
Australia's submission.760  The Panel has amended paragra ph 7.3 in the manner requested by 
Australia, also taking into account New Zealand's suggestion. 
                                                      
752 Swinburne, "European Canker of Apple ( Nectria galligena )" (1975), in Exhibit NZ-9. 
753 Australia's IRA, Part C, p. 102. 
754 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 8. 
755 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 7. 
756 For example, paras. 7.455-7.459, 7.757-7.761 and 7.873-7.874 of the interim report. 
757 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 9-11. 
758 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 8. 
759 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 12. 
760 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 9.  WT/DS367/R 
 Page 171 
 
 
 6.9 Australia requests that paragraphs 7.11 and 7.21 be amended to note Australia's reason for 
seeking two experts for each of the three pests at issue.761  The Panel has amended paragraph 7.11, 
which notes Australia's expressed concerns, in the manne r requested by Australia.  The Panel has also 
made related changes in pa ragraphs 7.20 and 7.21. 
6.10 Australia requests the Panel remove from paragr aph 7.15 the reference to Australia expressing 
the hope that further delays in the proceedings could be avoided.  In Australia's view, the statement it 
had made on 20 November 2008 "was intended to be he lpful to the Panel" and was not "any implied 
complaint about delays that had occurred to date".762  New Zealand rejects the request.  In 
New Zealand's view, the reference to Australia's statement is accurate.763  The sentence has been 
removed from paragraph 7.15, as requested by Australia. 
6.11 Australia requests that in paragraphs 7.16, 7. 27 and 7.28 of the report the word "alleged" be 
removed when referring to the "alleged connection" argued by Australia between one of the experts 
and New Zealand.  In Australia's view, the word "alleged" suggests that Australia did not support its 
contention.764  New Zealand rejects the request.  In Ne w Zealand's view, the word has been used 
appropriately in these paragraphs.765  The Panel notes that the use of the word "alleged" in the report 
implies only that this issue refers to an allegation that was raised by Australia.  Moreover, the Panel 
ultimately found no evidence of such connection.  Acco rdingly, the Panel sees no reason to remove or 
replace the word "alleged". 
6.12 Australia requests that the Panel remove the expression "[i]n the absence of any explanation 
or evidence from Australia in this regard" from the last sentence in paragraph 7.34.  Australia argues 
that, while it "does not contest that the Panel may properly arrive at the view that [the] connection 
[between one of the experts and New Zealand researchers] does not 'raise doubts regarding his 
independence and impartiality or his capacity to prov ide expert advice' to the Panel", the Panel should 
acknowledge that Australia did not simply assert a connection where none existed.766  The Panel notes 
that the expression objected to by Australia is tied to  the preceding sentence and refers to the fact that 
no explanation or evidence was provided by Australia  about how "Dr Cross's participation in a joint 
research project and publication with researchers fr om HortResearch New Zealand would call into 
question Dr Cross's independence and impartiality, or create actual or potential, direct or indirect, 
conflicts of interest".  Accordingly, the Panel s ees no reason to remove th e expression from paragraph 
7.34.  The Panel has, however, made small chang es in the language of the last sentence of the 
paragraph. 
6.13 Australia requests that in paragraph 7.35 the Pa nel change the phrase "Australia objected to 
two questions being posed to Dr Cross on the flight range of ALCM, arguing that this created a 
potential conflict of interest ", to "Australia objected to two ques tions being posed to Dr Cross on the 
                                                      
761 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 13-14. 
762 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 15. 
763 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 10. 
764 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 16. 
765 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 11. 
766 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 18. WT/DS367/R 
Page 172  
 
 flight range of ALCM, arguing that this may create a potential conflict of interest ", to more accurately 
reflect Australia's original statement.
767  The Panel has made the change requested by Australia. 
6.14 Australia requests that the Panel include in pa ragraphs 7.37 and 7.38 a mention to Australia's 
concern, expressed on 19 December 2008, that expe rts should not have been permitted to choose the 
questions that they responded to, but rather the Panel should have allocated the questions to the 
experts, based on the experts'  relevant areas of expertise.768  The Panel has made the change requested 
in 7.37.  Having noted Australia's concern in paragr aph 7.37, the Panel sees no need to note it again in 
paragraph 7.38. 
6.15 Australia requests that in paragraph 7.39 of th e report the word "allegedly" be removed when 
referring to the Panel allegedly  having posed written questions to the experts that either did not appear 
in the draft questions originally provided to the Pa rties or were substantially modified from the draft 
list of questions.  In Australia's view, the word "alle gedly" suggests that Australia did not substantiate 
its point.769  The Panel notes that the use of the word "a llegedly" in this report implies only that this 
issue refers to an allegation that was raised by Australia.  Accordingly, the Panel sees no reason to 
remove or replace the word "allegedly".  In any event,  and in the light of Aust ralia's request, the Panel 
has removed the quotation marks from the word  "new" in subheading (b) in page 179. 
6.16 Australia requests that the report be amended to note that, contrary to what paragraph 7.43 
would appear to suggest, in its responses to the Pa nel's questions after the second substantive meeting 
Australia did not refer only to new questions , but also to modified or amended questions .770  The Panel 
has made the change requested in paragraph 7.43.   The Panel has also made related changes in 
paragraphs 7.46, 7.59 to 7.63 and 7.66.  For the same reason, a new paragraph has been inserted after 
paragraph 7.50. 
6.17 Australia requests that the third sentence be deleted from paragraph 7.61, because this 
sentence "is not referenced by a footnote or otherwise supported".771  New Zealand rejects the request.  
In New Zealand's view, the sentence objected to "accurately reflects the thrust of Australia's 
comments" in relation to Panel question 37 to the experts.772  The Panel has added a footnote 
reference to the sentence in question. 
2. Whether the measures identified by New Zealand are challengeable under the SPS 
Agreement 
6.18 Australia requests that paragraph 7.104 be amended to reflect more accurately Australia's 
submissions on whether a particular measure fa lls within the definiti on of an "SPS measure".773  New 
Zealand rejects the request.  In New Zealand's view, Australia is trying to recharacterize its arguments 
                                                      
767 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 19 (emphasis added). 
768 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 20. 
769 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 22. 
770 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 24-26. 
771 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 27. 
772 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 12. 
773 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 28-29.  WT/DS367/R 
 Page 173 
 
 
 in relation to a distinction between  principal and ancillary measures.774  Having considered the 
language used by Australia in its second written s ubmission, the Panel has amended paragraph 7.104 
in the manner requested by Australia. 
6.19 Australia also requests that paragraph 7.105 be amended to reflect more accurately Australia's 
submissions on the relevance of the reasoning of the US – Export Restraints  panel for the definition of 
an "SPS measure".  Australia requests that the third sentence in that paragraph be deleted and replaced 
with excerpts from Australia's responses to the Panel's questions.775  New Zealand rejects the request.  
In New Zealand's view, the sentence objected to has accurately reflected Australia's argument.776  
Having considered Australia's written submissions a nd its responses to the Panel's questions, the Panel 
has added the text proposed by Australia to pa ragraph 7.105, but it has not deleted the disputed 
sentence.  In a related request, Australia asks the Panel to amend paragraphs 7.175 to 7.179, which 
deal with the distinction between principal and ancillary measures.777  The Panel has accordingly 
incorporated a new paragraph after paragraph 7. 174 and has made changes to paragraph 7.175. 
6.20 Australia requests that paragraph 7.106 be ame nded for the sake of completeness, to reflect 
more accurately Australia's submissions on why its arguments would not raise systemic concerns.778  
Having considered Australia's second written submissi on, the Panel has added the text proposed by 
Australia to paragraph 7.106. 
6.21 Australia requests that paragraph 7.121, in the section containing the Panel's analysis on 
whether the measures identified by New Zealand are challengeable under the SPS Agreement, be 
amended to clarify the meaning of the first sentence.  Australia also requests that the last sentence of 
the paragraph be revised, in order to accurately reflect how Australia would respond to a lack of 
compliance with any of the measures at issue.779  The Panel has amended the first sentence of 
paragraph 7.121 as requested by Australia.  Also, ha ving considered Australia's written submissions 
and its responses to the Panel's questions, as well as the description of the measures in other parts of 
the report, the Panel has amended the last sentence of paragraph 7.121. 
6.22 Australia requests that the Panel's findings "in r espect to whether particular measures at issue 
in this dispute are 'SPS measures'", contained in pa ragraphs 7.122 to  7.171, be revised, so that those 
findings are confined to groups of related measures rather than to individual measures.  Australia 
submits that findings on individual measures w ould be unnecessary for resolving this dispute.  
Australia suggests that other sections of the repor t would also need to be adjusted accordingly.780  
New Zealand rejects the request.  In New Zeal and's view, Australia's request is "based on a 
fundamental misreading of the interim report".781  The Panel considers Australia's request is 
inconsistent with the approach followed in the Pa nel's report.  Indeed, the Panel has examined the 
                                                      
774 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 13. 
775 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 30-33. 
776 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 14. 
777 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 64-69. 
778 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 34-35. 
779 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 36-40. 
780 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 41-51. 
781 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, paras. 15-18. WT/DS367/R 
Page 174  
 
 measures both collectively, and individually.  The Pa nel has also reserved its right to analyse various 
related measures jointly, under specific provisions of  the SPS Agreement.  Accordingly, the Panel 
sees no reason to modify paragraphs 7.122 to 7.171 in this respect. 
6.23 Australia argues that there are "a number of erro rs" in subparagraphs (b), (e), (g) and (k) of 
paragraph 7.140, in the section containing the Pane l's analysis on whether the measures identified by 
New Zealand are challengeable under the SPS Agreem ent.  Australia requests that the whole of 
paragraph 7.140 be deleted.  Alte rnatively, Australia requests that "appropriate changes be made" in 
the paragraph to reflect its objections.
782  New Zealand rejects the request.  In New Zealand's view, 
Australia has failed to identify errors that would warrant deleting the whole of paragraph 7.140.  At 
the same time, New Zealand submits that Australia's  objection to subparagraph (b) could be addressed 
by amending the first sentence of that subparagraph.783  The Panel sees no reason to delete the whole 
paragraph 7.140.  Having considered the description of the measures in Australia's IRA, however, the 
Panel has amended subparagr aphs (b), (g) and (k). 
6.24 Australia requests that the first sentence in pa ragraph 7.157 be delete d, and a consequential 
change be made in paragraph 7.1 58, to clarify that neither the IRA nor the IRA process are measures 
at issue in the dispute.784  Australia also requests that a word be replaced in paragraph 7.158.785  The 
Panel sees no reason to amend paragr aphs 7.157 and 7.158.  The report does not define the IRA nor 
the IRA process as measures at issue in the dispute.  The report notes, however, that the measures at 
issue are spelt out in the IRA.  Also, replacing the word as suggested by Australia would change the 
meaning of the sentence in question. 
6.25 Australia requests that the Panel revise its analys is of the issues discussed in paragraphs 7.175 
to 7.179.  Australia submits that these paragraphs imply that Australia relied mainly, or exclusively, 
on the reasoning of the panel in US – Export Restraints .  In Australia's view, it is not appropriate for 
the Panel to treat Australia's points relating to US – Export Restraints  in isolation from Australia's 
principal submission in respect of "SPS measures" set out Annex A(1).786  New Zealand rejects the 
request.  In New Zealand's view, Australia appears to seek to downplay its reliance on US – Export 
Restraints , which was central to Australia's distinction between principal and ancillary measures.  In 
New Zealand's view, Australia's request contradict s the statements made during the proceedings.  
New Zealand adds that, in the light of Australia's reliance on US – Export Restraints , the Panel's 
statements in paragraph 7.179 are important and shoul d be retained.787  Having considered the text of 
the IRA, Australia's submissions and responses to the Panel's questions, as well as New Zealand's interim review comments, the Panel has inserted a new paragraph after paragr aph 7.174 and has made 
small amendments to paragraph 7.175. 
6.26 Australia requests that paragraph 7.180, in the section containing the Panel's analysis 
regarding the alleged distinction between principal and ancillary measures, be  amended to note that 
"most of the experts ... supported the notion that certain of the measures at issue could be 
distinguished on the basis of their purpose in respect  of risk reduction, even if they disagreed on 
                                                     
 
782 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 52-59. 
783 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 19. 
784 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 60-61. 
785 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 62-63. 
786 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 64-69. 
787 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 20.  WT/DS367/R 
 Page 175 
 
 
 which measures would fall into which category."788  New Zealand rejects the request.  In 
New Zealand's view, the last sentence of the paragr aph "correctly characterizes the experts' views".789  
The Panel sees no reason to amend pa ragraph 7.180.  The Panel has,  however, added references in a 
footnote to paragraph 7.180, as requested by Australia and New Zealand.790 
6.27 Australia requests that the Panel reconsider its analysis of the issues discussed in paragraphs 
7.182 and 7.183.  In Australia's view, "the Pane l appears to have mis understood the nature of 
Australia's submissions on the suggested grouping of relevant measures".791  Having considered the 
text of the IRA, and Australia's submissions a nd responses to the Panel's questions, the Panel has 
made changes in paragraphs 7.183 a nd 7.184 to address Australia's request. 
3. New Zealand's claims under Articles 2. 2, 5.1 and 5.2 of the SPS Agreement 
(a) Order of analysis 
6.28 New Zealand requests that paragraph 7.191, in the section that summarizes its arguments, be 
amended.  New Zealand proposes that additional text be inserted in that  paragraph to better reflect its 
argument regarding Australia's view that a consid erable deference should be accorded to Members' 
risk assessments.792  Having considered New Zealand's statement at the first substantive meeting with 
the Panel, the Panel has amende d paragraph 7.191 in the manner requested by New Zealand. 
6.29 Australia requests that paragraph 7.192, in  the section that summarizes New Zealand's 
arguments, be amended.  Australia proposes that th e report reflect that a response from New Zealand 
was directed at arguments raised by Australia that are specific to this dispute.793  New Zealand rejects 
the request.  In New Zealand's view, Australia did not  clarify in the course of the proceedings that its 
arguments were "specific to this dispute".794  The Panel sees no reason to  amend paragraph 7.192. 
6.30 Australia requests that paragraphs 7.198 a nd 7.199, in the section that summarizes its 
arguments, be amended in order to better reflect Au stralia's submissions.  In Australia's view, these 
paragraphs should be revised and ne w text should be added to reflect Australia's elaboration of its 
arguments after the first written submission and in  the light of the Appellate Body's report in 
US/Canada – Continued Suspension .  Australia also requests that the expression originally used by 
Australia that the IRA was "objective and credib le" be replaced with "objective and coherent" 
throughout the report, including in paragraph 7.200, to reflect the change in language in Australia's 
latter submissions.795  New Zealand rejects Australia's request to amend paragraphs 7.198 and 7.199.  
In New Zealand's view, Australia's arguments are set  out in detail elsewhere in the report and it would 
                                                      
788 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 70-71. 
789 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 21. 
790 Communication from Australia to the Panel, 22 April 2010, Australia's comments on New Zealand's 
request for review of the interim report, para. 2;  Communication from New Zealand to the Panel, 15 April 
2010, New Zealand's request for review of the interim report, p. 2. 
791 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 72-73. 
792 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 2. 
793 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 74-75. 
794 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 22. 
795 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 76-82. WT/DS367/R 
Page 176  
 
 be unnecessary and inappropriate to insert lengthy  new sections in this part of the report.
796  Having 
considered Australia's submissions, its statements  at the second substantive meeting with the Panel 
and its subsequent responses to the Panel's ques tions, the Panel has ame nded paragraph 7.198 and 
incorporated new text after this paragraph to ad dress Australia's request.  The expression originally 
used by Australia "objective and credible" has been replaced with "objective and coherent" in 
paragraphs 7.199 and 7.202 in the manner requested by  Australia.  Further, a footnote has been added 
to paragraph 7.199, noting that the expression used  by Australia in its first written submission was 
later changed to "objective and coherent".  The e xpression was not changed in  paragraph 7.200, which 
contains a quote from Australia's first written submission. 
6.31 Australia requests that paragraph 7.203 in the section containing the Panel's analysis, be 
amended, because in its view it is incorrect to characterize New Zealand's claims under Articles 2.2, 
5.1 and 5.2 as "separate and autonomous".797  New Zealand rejects Australia's request.  In 
New Zealand's view, the Panel's characterization is correct.798  The Panel notes that arguments made 
by New Zealand under one claim were at times also used by New Zealand to support other claims.  The Panel considers, however, that New Zeala nd advanced separate and autonomous claims under 
Articles 2.2, 5.1 and 5.2 of the SPS Agreement.  Ac cordingly, there is no reason to amend paragraph 
7.203 in this respect. 
(b) Standard of review 
6.32 Australia requests that paragraphs 7.214 and 7.215, in the section describing the Parties' 
arguments, be amended to better re flect Australia's arguments as th ey were developed over various 
submissions and, in particular, in lig ht of the Appellate Body's report in US/Canada – Continued 
Suspension .  Australia also requests that the first sent ence in paragraph 7.214 note that its argument 
was that the standard of review applied by the Pa nel should be specific to the SPS Agreement and also 
to the particular obligation in question.
799  Having considered Australia's first written submission, to 
which Australia referred to in its request, the Panel has made some amendments to paragraph 7.214.  
The Panel notes that footnotes to that paragraph are clear that the references are to Australia's first 
written submission, to its statements at the firs t substantive meeting with the Panel and to its 
subsequent responses to the Panel' s questions after that meeting. 
6.33 Australia requests that paragraph 7.220 be  amended, because New Zealand incorrectly 
described Australia's argument as suggesting that New Zealand should demonstrate the existence of 
serious flaws at each step of the risk assessment.800  New Zealand rejects Australia's request.  In New 
Zealand's view, it is inappropriate for Austra lia to propose amending a paragraph summarizing 
New Zealand's arguments.801  Having considered New Zealand's submissions and its responses to the 
Panel's questions after the second substantive mee ting, the Panel sees no reason to amend paragraph 
7.220. 
                                                      
796 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 23. 
797 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 83-84. 
798 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 24. 
799 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 85-86. 
800 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 87-89. 
801 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 25.  WT/DS367/R 
 Page 177 
 
 
 6.34 Australia requests that, for completeness, paragraph 7.225, in the section containing the 
Panel's arguments, be amended.  In its view, as the Panel refers to "Austra lia's reliance upon the panel 
report in Australia – Salmon (Article 21.5 – Canada) ", it should "also set out paragraph 7.57 of [that] 
compliance panel's report".802  New Zealand rejects Australia's request.  In New Zealand's view, the 
paragraph of the Australia – Salmon (Article 21.5 – Canada)  compliance panel report identified by 
Australia is not directly relevant to the Pane l's general discussion on the standard of review.803  The 
Panel sees no reason to am end paragraph 7.225. 
(c) Summary of the Parties' arguments under Articles 5.1 and 5.2 of the SPS Agreement 
6.35 Australia requests that, for completeness, paragr aphs 7.228 to 7.233, in the section describing 
the Parties' arguments, be amende d.  Australia suggests that this section include arguments made by 
New Zealand relating to the Japan – Apples  dispute.804  New Zealand rejects Australia's request to 
amend these paragraphs.  New Zealand notes that its ar guments are set out in part IV of the report and 
it would be unnecessary to insert further re ferences in this part of the report.805  The Panel sees no 
reason to amend paragraphs 7.228 to 7.233. 
6.36 Australia requests that the Panel record in this  section Australia's response to New Zealand's 
argument, noted in paragraph 7.231,  that Article 5.2 of the SPS Agre ement contains an obligation to 
give "genuine consideration" to a numbe r of factors listed in that provision.806  Having considered 
Australia's written submissions, the Panel has adde d a new paragraph immediately after paragraph 
7.235, as requested by Australia. 
6.37 With respect to paragraphs 7.232 to 7.236, Aust ralia requests that the Panel record its "overall 
contention with respect to each pest risk assess ment, that … if New Zealand has successfully 
demonstrated any flaws, they are only minor ones, and do not undermine the overall objective 
justifiability of the particular  risk assessment at issue".807  Having considered Australia's written 
submissions, the Panel has added new text into  paragraph 7.232, as requested by Australia. 
(d) Requirements regarding fire blight 
6.38 The Panel has amended paragraph 7.242, as requested by Australia.808 
6.39 Australia requests that paragraph 7.253, in the section containing the Panel's analysis on the 
alleged overestimation for im portation step 1 for fire blight, be am ended.  In Australia's view, this 
paragraph contains a reference that relates to "[ t]he issue of pollution of fruit surface [which] is 
relevant to Importation step 2, not  Importation step 1".  Australia requests therefore that the Panel 
delete the sentence with that reference from the para graph or, alternatively, move this sentence to the 
section dealing with importation step 2.  Australia  also requests that the Panel replace the word 
                                                      
802 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 90. 
803 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 26. 
804 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 91. 
805 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 27. 
806 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 92-93. 
807 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 94. 
808 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 95. WT/DS367/R 
Page 178  
 
 "cautioned", when referring to one of the expe rts' comments, with the expression "expressed the 
view".  In the same paragraph, Australia requests the Panel to amend the re ference to the experts' 
comments, in order that such refe rence is reproduced more accurately.
809 New Zealand rejects 
Australia's request to amend this paragraph.  In New Zealand's view, the reference to the expert's 
response relates to importation step 1, so it would be appropriate for this sentence to remain in 
paragraph 7.253.  New Zealand adds that the word  "cautioned" is correctly used in the paragraph.810  
The Panel considers that the sentence objected to by Australia is relevant for the discussion of 
importation step 1 and, therefore, sees no reason to de lete it or move it to a different section.  Having 
considered the text of the experts' response to one  of the Panel's questions, the Panel has made other 
changes in paragraph 7.253 to address Australia's request. 
6.40 Australia requests that paragraph 7.254 be am ended.  This paragra ph includes a reference 
that, in Australia's view, "relates to the chance of  fruit contamination surface, which is relevant to 
Importation step 2, not Importation step 1".  Australia  requests that the Panel delete the sentence with 
the reference from the paragraph or, alternatively,  move this sentence to the section dealing with 
importation step 2.811 New Zealand rejects Australia's request to amend this paragraph.  In 
New Zealand's view, the reference to the expert's r esponse relates to importation step 1, so it would be 
appropriate for this sentence to  remain in paragraph 7.254.812  The Panel considers that the sentence 
objected to by Australia is relevant for the discu ssion of importation step 1 and, therefore, sees no 
reason to delete it or move it to a different section. 
6.41 Australia requests that a sentence be added to  paragraph 7.258, in the section describing 
New Zealand's arguments on the alle ged overestimation for importation st ep 2 for fire blight, in order 
to note that New Zealand is referring to a paper by Roberts and Sawyer (2008).  In Australia's view, 
this would also provide context for the subseque nt reference to that paper in the summary of 
Australia's arguments.813  New Zealand suggests that, in order to  provide context, a reference to other 
paragraphs in New Zealand's first written submission and in New Zealand's comments on Australia's responses to questions after the second substantive m eeting, be added to foot note 1219 to paragraph 
7.258.
814  The Panel has added the references re quested by Australia and New Zealand. 
6.42 Australia requests that new text be added to pa ragraph 7.260, in order to convey more fully 
Australia's argument regarding Roberts and Sawyer (2008).815  New Zealand rejects Australia's 
request.  In New Zealand's view, Australia's  arguments on Roberts and Sawyer (2008) are 
summarized in a different section, namely in pa ragraph 7.428.  New Zealand suggests that the 
additional references noted by Aust ralia could be added to the footnot e to paragraph 7.428;  it also 
suggests that additional references to New Zealand' s submissions could also be included in that 
footnote.816  The Panel has added, in paragraph 7.260 and in the footnote to paragraph 7.428, the text 
                                                      
809 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 96-100. 
810 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 28. 
811 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 101-102. 
812 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 29. 
813 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 103-105. 
814 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 30. 
815 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 106. 
816 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 31.  WT/DS367/R 
 Page 179 
 
 
 and the references requested by Australia;  it has al so added in the footnote to paragraph 7.428 the 
references requested by New Zealand. 
6.43 Referring to paragraph 7.267, Australia requests th at the Panel record Australia's argument in 
its first written submission, regarding the experi ment reported in the paper by van der Zwet et al . 
(1990).817  New Zealand requests that, if the Panel in cludes the references provided by Australia, it 
also include references to New Zealand's second written submission.818  The Panel has inserted into 
the footnote to paragraph 7.267 the referen ces requested by Australia and New Zealand. 
6.44 The Panel has amended paragraph 7.290, as requested by Australia.819 
6.45 Australia requests that paragraph 7.299, in the section containing the Panel's analysis on the 
alleged overestimation for im portation step 4 for fire blight, be amended.  Australia requests that the 
Panel change the expression that refers in that para graph to disinfection as "a routine procedure in the 
packing house", with "a procedure used in some 53 per cent of packing houses".  Australia suggests 
that the latter expression is more accurate and is based on information provided by New Zealand.820  
New Zealand rejects Australia's request.  New Zealand submits that the use of the expression is appropriate.  New Zealand notes that disinfection is  defined as one of the "routine procedures that 
occur in New Zealand packing houses".
821  The Panel notes that paragraph 7.299 is part of the Panel's 
analysis of the IRA's reasoning regarding importati on step 4.  Importation step 4 refers to the 
likelihood that infected or infested fruit remain s infected or infested after routine processing 
procedures in the packing house.  According to the IRA, these "routine pr ocedures in the packing 
house" include pre-cooling, washing, disinfection, brushing, waxing, sorting and grading, packaging 
and cold storage.822  Accordingly, the Panel sees no reason to amend paragraph 7.299. 
6.46 Australia requests that paragraph 7.316, in the section containing the Panel's analysis on the 
alleged overestimation for importation step 5 for fire blight, be  amended.  Noting a reference to a 
study by Vanneste (2008) in the statement of an expe rt included in that para graph, Australia requests 
that the Panel record that this evid ence "became available in 2008, that is, after  the IRA was 
completed and during proceedings  in the current dispute".823  New Zealand suggests that the reference 
to Vanneste (2008) may have been a typographical erro r, because there is no reference to this study in 
the IRA or by either of the Parties.  New Zealand suggests that the expert may have been referring to 
Vanneste (2006), which was submitted as an exhibit by New Zealand and is part of the record.  New 
Zealand notes further that the IRA refers to a differe nt study, which Vanneste co-wrote in 2004, that 
reaches similar conclusions to those expressed by the expert in paragraph 7.316.  New Zealand submits that, in these circumstances, it would be appropriate to remove the reference to Vanneste 
                                                     
 
817 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 107. 
818 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 32. 
819 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 108. 
820 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 109. 
821 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 33. 
822 Australia's IRA, Part B, pp. 76-77. 
823 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 110 (original emphasis). WT/DS367/R 
Page 180  
 
 (2008) from paragraph 7.316.
824  Accordingly, the Panel has re moved the reference to Vanneste 
(2008) from paragraph 7.316. 
6.47 Australia requests that paragraph 7.327, in the section containing the Panel's analysis on the 
alleged overestimation for importation step 6 for fire blight, be amended.  This paragraph includes a 
reference to an expert's answer that, in Australia's view, "is not relevant to the Panel's finding at this 
importation step [6], as it related to disinfection procedures which are assessed at Importation step 4".  
Australia requests that the Panel remove the refere nce to the expert's answer in this paragraph.825  
New Zealand rejects Australia's request to amend this  paragraph.  In New Ze aland's view, it would be 
inappropriate to remove the reference to the expert 's response in this paragraph, because it relates to 
importation step 6.826  The Panel considers that the disputed answer is relevant for the discussion of 
importation step 6 and, therefore, sees no reason to delete it from paragraph 7.327. 
6.48 Australia requests that paragraph 7.349, in the section that summarizes Australia's arguments 
on the alleged overestimation for the overall probab ility of importation for fire blight, be amended, 
because in Australia's view in its current form it could lead to a mischaracterization of its position.827  
The Panel has amended paragraph 7. 349, as requested by Australia. 
6.49 The Panel has amended paragraph 7.355, as requested  by Australia, in order to clarify that the 
text is not a quotation.828 
6.50 Australia requests that paragraph 7.362, in the section that summarizes Australia's arguments 
on the IRA's analysis of the probability of entry, est ablishment and spread of fi re blight, be amended, 
because in Australia's view in its current form it is  not clear whether it intends to reproduce Australia's 
argument or New Zealand's assertions.  Australia argu es that if the intention of the paragraph is to 
reproduce Australia's argument, it would be an incorrect characterization of its position.829  Having 
considered Australia's first written submission, th e Panel has amended para graph 7.362 to address 
Australia's request. 
6.51 Australia requests that the Panel remove the fi rst sentence in paragraph 7.376, in the section 
containing the Panel's analysis on the IRA's reasoning on proximity for fire blight.  In this sentence, 
the Panel notes that, "[c]onsulted by the Panel, the experts expressed scepticism regarding some of the 
scenarios considered under the IRA's proximity an alysis".  Australia argues that the sentence 
attributes an emphasis that is not present in the answers of one of the experts.830  New Zealand rejects 
Australia's request.  In New Zealand's view, the wo rd "scepticism" has been used appropriately in 
                                                      
824 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 34. 
825 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 111-112. 
826 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 36. 
827 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 113-114. 
828 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 115. 
829 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 116-118. 
830 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 119.  WT/DS367/R 
 Page 181 
 
 
 connection with the responses of experts consulted by the Panel.831  The Panel sees no reason to 
amend paragraph 7.376. 
6.52 Australia requests that the Panel amend the intr oductory sentence in paragraph 7.398, in the 
section containing the Panel's analysis on the IRA's reasoning on exposure for fire blight.  In this 
sentence, the Panel refers to "the theoretical possib ility of an insect taking a few bacterial cells to the 
hypantium of a flower of an host plant".  Aust ralia requests that the Panel remove the word 
"theoretical", arguing that "[t]his was not a term used by the experts".832  New Zealand rejects 
Australia's request.  In New Zealand's view, the word  "theoretical" has been used appropriately by the 
Panel.833  Having considered the response of the expert to a Panel question that is referred to in 
paragraph 7.398, the Panel sees no re ason to amend paragraph 7.398. 
6.53 Australia requests that the Panel amend a sen tence in paragraph 7.427, in the section 
containing the Panel's conclusions regarding entry, establishment and spread for fire blight.  This 
sentence records the opinion of the experts cons ulted by the Panel that the studies cited " maximized  
the theoretical risk of introduction of Erwinia amylovora  with potentially infested apples fruits…"  
Australia requests that the Panel remove the word "the oretical", arguing that "[t]he term was not used 
by the experts".834  New Zealand rejects Australia's request.  In New Zealand's view, the word 
"theoretical" has been used appropriately by th e Panel.  New Zealand notes additionally that the 
sentence objected to by Australia refers to the r esponse of an expert to a Panel's question and the 
expert specifically uses the word "theoretical".835  Having considered the response of the expert to a 
Panel question that is referred to  in paragraph 7.427, the Panel sees no reason to amend paragraph 
7.427.  The Panel has, however, added references two footnotes to paragraph 7.427, as requested by 
Australia and New Zealand.836 
6.54 Australia requests that the Panel amend a senten ce in paragraph 7.429.  In Australia's view, 
this sentence, which refers to the possible effect of proximity to orchards, does not correctly reflect 
the IRA's conclusions regarding fire blight.837  Having considered the text of the IRA and the opinions 
expressed by the experts, the Panel has amende d paragraph 7.429 to address Australia's request. 
6.55 Australia requests that the Panel amend a senten ce in paragraph 7.437.  In Australia's view, 
this sentence does not accurately reflect the r esponse of an expert consulted by the Panel.838  Having 
considered the response provided by the expert to the question that is referred to in the sentence 
objected to by Australia, the Panel has amended paragraph 7.437. 
                                                      
831 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 37. 
832 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 120-121. 
833 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 38. 
834 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 122-123. 
835 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 38. 
836 Communication from Australia to the Panel, 22 April 2010, Australia's comments on New Zealand's 
request for review of the interim report, para. 4;  Communication from New Zealand to the Panel, 15 April 
2010, New Zealand's request for review of the interim report, p. 4. 
837 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 124-125. 
838 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 126-128. WT/DS367/R 
Page 182  
 
 6.56 The Panel has amended paragraph 7.442, rea rranging the order of the sentences and setting 
out the quotation from an expert's response to a Panel's question, as requested by New Zealand.
839 
6.57 Australia requests that the Panel amend the firs t sentence in paragraph 7.447, in the section 
describing New Zealand's arguments on the pot ential biological and ec onomic consequences 
associated with fire blight, in order to clarify that the expression to "uns ubstantiated assumptions" in 
New Zealand's submission is referring to a paper by Roberts (1991).840  Australia also requests that 
the Panel amend the fourth sentence in order to clar ify that New Zealand's argument that "the impact 
of fire blight on pipfruit production in non-outbreak years is inconsequential" is based on its own 
experience.841  Australia additionally requests that the Panel amend the fifth sentence in order to 
clarify that New Zealand's argument on pipfruit  production losses from a fire blight outbreak are 
based on evidence from New Zealand.  Australia re quests that the same sentence note New Zealand's 
statement that production losses "may occasionally be significant at a local level only".842  
New Zealand rejects the first of Australia's requests.   In New Zealand's view, the Panel has correctly 
summarized its argument, which was not merely directed at Roberts (1991).843  Having considered 
New Zealand's first written submission, the Panel ge nerally sees no reason to amend paragraph 7.447.  
The Panel has, however, clarified in the sentence th at, in its written submission, New Zealand referred 
to the impact of fire blight on pipfruit production in New Zealand .  The Panel has also corrected 
footnote 1525, as requested by Australia and New Zealand.844  It has additionally corrected footnote 
1528, as requested by New Zealand.845  The text suggested by Au stralia on the possibility of 
production losses at a local level was al ready part of paragraph 7.447. 
6.58 Australia requests that the Panel include a sentence in the section describing Australia's 
arguments on the potential biolog ical and economic consequences associated with fire blight 
(paragraphs 7.450 to 7.454), in order to reflect  its contention that "New Zealand had put no 
substantive argument on the issue of the assessment of  the consequences of fire blight either in its 
second written submission or at the second hearing".846  New Zealand rejects Australia's request.  
New Zealand notes that Australia's argument, which was made at the second substantive meeting with 
the Panel, is contained in part IV of the report.  In New Zealand's view, it is not necessary to repeat 
this argument in paragraphs 7.450 to 7.454.847  Having considered Australia's statement at the second 
substantive meeting with the Panel, the Panel has added the text proposed by Australia to 
paragraph 7.453. 
                                                      
839 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 5. 
840 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 129-131. 
841 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 133. 
842 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 134-135. 
843 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 39. 
844 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 132;  Communication from New Z ealand to the Panel, 15 April 2010, New Zealand's 
request for review of the interim report, p. 5. 
845 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 5. 
846 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 136-137. 
847 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 40.  WT/DS367/R 
 Page 183 
 
 
 6.59 Australia requests that a sentence be amended in paragraph 7.473, in the section describing 
New Zealand's arguments on the alleged methodologi cal flaws identified by New Zealand.  In 
Australia's view, text should be added to the first sentence in that paragraph to note "that New Zealand 
places reliance on trade data to support its  position regarding the use of 1 × 10-6 as the maximum 
value for 'negligible'."848  New Zealand rejects Australia's request.  In New Zealand's view, it is 
inappropriate for Australia to propose amending a paragraph summarizing New Zealand's arguments.  
New Zealand submits that the additional text propo sed by Australia "reflect[s] Australia's comments 
on New Zealand's argument, rather than  the argument made by New Zealand."849  Having considered 
New Zealand's first written submission, the Pane l sees no reason to amend paragraph 7.473.  The 
footnote to that paragraph, however, has been amended, as requested by Australia to provide 
additional context to the sentence. 
6.60 Australia requests that the first sentence in paragraph 7.474, in the section describing its 
arguments on the alleged methodological flaws id entified by New Zealand, be amended.  In 
Australia's view, the second part of the sentence shoul d be removed, because it "incorrectly refers to 
alternative definitions [of 'negligible  risk'] proposed by New Zealand".850  Also in paragraph 7.474, 
Australia requests that a clarification be added to a se ntence, to refer to the u se of the interval between 
0 and 10-6 in the IRA as a "uniform distribution".851  Regarding the first of Australia's requests, 
New Zealand suggests that, while Australia is correct, this concern could be remedied by simply replacing a word rather than by deleting the whole text.
852  Having considered Australia's submissions, 
the Panel has made all the amendments requested by  Australia.  The Panel has also made a correction 
in the second sentence of the paragraph, as requested by Australia.853 
6.61 Australia requests that paragraph 7.475, in th e section describing its arguments on the alleged 
methodological flaws identified by New Zealand, be am ended.  In Australia's view, its arguments are 
not properly reflected in that paragraph.  Austra lia suggests an alternative text for the paragraph.854  
Having considered Australia's submissions, the Panel has made the amendments requested by 
Australia. 
6.62 Australia requests that paragraphs 7.486 and 7. 487, in the section describing its arguments on 
the alleged methodological flaws identified by New Z ealand, be amended.  Australia requests that the 
Panel add the word "uniform", when referring to th e distribution, in the first sentence of paragraph 
7.486.  Australia also suggests the addition of a te xt after paragraph 7.487, to record one of its 
arguments.855  Having considered Australia's submissions, the Panel has made the amendments 
requested by Australia. 
                                                      
848 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 138-140. 
849 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 41. 
850 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 141. 
851 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 143. 
852 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 42. 
853 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 142. 
854 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 144-145. 
855 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 146-147. WT/DS367/R 
Page 184  
 
 6.63 Australia requests that paragraph 7.488, in th e section describing the Panel's analysis on the 
alleged methodological flaws identified by New Zeal and, be amended.  Australia requests that the 
Panel delete the words "but in the circumstances of this case" from the last sentence in the paragraph.  
Australia also requests that a reference be adde d into one of the footnotes of the paragraph.
856  
New Zealand rejects Australia's request to delete  words from the last sentence in the paragraph.857  In 
the Panel's view it is correct to refer that the stat ement contained in the last sentence in the paragraph 
refers to the use of a uniform distribution in the circumstances of this case.  Accordingly, the Panel 
sees no reason to amend paragraph 7.488.  A footnote  to that paragraph, however, has been amended 
to add the reference noted by Australia. 
6.64 The Panel has corrected footnote 1597 to paragraph 7.489, as requested by Australia.858 
6.65 The Panel has corrected paragraph 7.499 in  the manner requested by Australia and 
New Zealand.859 
(e) Requirements regarding European canker 
6.66 Australia requests that paragraph 7.526, in the section containing the Panel's analysis on the 
alleged overestimation for importation step 2 for European canker, be amended.  Australia argues that 
the IRA cites studies which confirm fruit rot caused by N. galligena  in New Zealand.  Australia 
submits that the report fails to refer to the relevant studies in this regard or to the experts' acceptance 
of the possibility of latent infection.  Australia adds that the report should acknowledge the situation 
regarding the limited availability of the data for the IRA Team to access.860 New Zealand rejects 
Australia's request to amend this paragraph.  In  New Zealand's view, the amendments proposed by 
Australia are misleading and irrelevant a nd the paragraph shou ld remain unchanged.861  Having 
considered Australia's request, the Panel sees no reason to amend paragraph 7.526, in the manner 
suggested by Australia. 
6.67 Australia requests that the Panel delete the word "mistakenly" from the first sentence of 
paragraph 7.528, as this word was not used  by the expert consulted by the Panel.862 New Zealand 
rejects Australia's request.  In New Zealand's view, in light of the expert's reply, it was open for the 
Panel to infer that the expert considered the IRA to be mistaken.  New Zealand also requests that a 
reference be added into f ootnote 1650 to the paragraph.863  Having considered Australia's and 
New Zealand's requests, the Panel has removed the word "mistakenly" and has added a reference to 
the footnote in question. 
                                                      
856 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 148-149. 
857 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 43. 
858 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 150. 
859 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 151;  Communication from New Z ealand to the Panel, 15 April 2010, New Zealand's 
request for review of the interim report, p. 5. 
860 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 152-156. 
861 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, paras. 44-47. 
862 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 157. 
863 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, paras. 48-49.  WT/DS367/R 
 Page 185 
 
 
 6.68 Australia requests that the Panel delete the first sentence of paragraph 7.531.  Australia 
submits that appropriate climat ological conditions have been and are present in New Zealand for 
European canker development and latent infection.864  New Zealand rejects Australia's request.  In 
New Zealand's view, the Panel's statements in this regard are adequately supported.865  Having 
considered Australia's request, the Pane l sees no reason to amend paragraph 7.531. 
6.69 Australia submits that paragraphs 7.532 and 7.535, in the section containing the Panel's 
analysis on the alleged overestimati on for importation step 2 for European canker, are actually related 
to importation step 3.  Australia requests that the Pa nel delete the paragraphs or otherwise move them 
to the appropriate section.866  New Zealand rejects Australia's re quest to delete the paragraphs, but 
does not object to moving them to the section on importation step 3.867  Having considered Australia's 
request, the Panel has moved the content of paragr aphs 7.532 and 7.535 to the section containing the 
Panel's analysis on the alleged overestimation for im portation step 3.  Consequent adjustments have 
been also made to paragraph 7.1198. 
6.70 Australia requests that the Panel insert a quote from the response of one of the experts to 
paragraph 7.533, in the section containing the Pane l's analysis on the alleged overestimation for 
importation step 2 for European canker.868  New Zealand requests that, if the Panel decides to add the 
quote requested by Australia, it also include the immediately following paragraphs of the same 
expert's response.869  Having considered Australia's and New Zealand's requests, the Panel sees no 
reason to amend paragraph 7.533. 
6.71 New Zealand requests that the Panel add a refere nce to responses of the experts in paragraphs 
7.534 and 7.537.870  The Panel has added the references in paragraphs 7.534 and 7.537, as requested 
by New Zealand. 
6.72 Australia requests that paragraphs 7.536 to 7.5 38 refer to the existence of scientific studies 
that were used in Australia's IRA, in order to ensu re that the Parties' arguments are properly reflected.  
Australia also requests that the Panel include a re ference to the acknowledgement made by one of the 
experts of the paucity of data specific to New Zeal and.  Australia additionally requests that the Panel 
note that the statement from one of th e experts regarding the fact that N. galligena  rots are not 
common in New Zealand, is based on a comparison with Europe.871  Regarding Australia's last 
request, New Zealand submits that the report correctly characterizes the expert's response.872  Having 
considered Australia's request, the Panel sees no reas on to amend paragraphs 7.536 to 7.538.  The 
Panel notes that the Parties' arguments are reflect ed in other sections of the report.  The Panel 
                                                      
864 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 158-160. 
865 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, paras. 50-51. 
866 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 161-162 and 166-167. 
867 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, paras. 52 and 55. 
868 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 163-165. 
869 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, paras. 53-54. 
870 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 6. 
871 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 168-173. 
872 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, paras. 56-57. WT/DS367/R 
Page 186  
 
 additionally notes that, in the quote already included in paragraph 7.538, the expert explicitly states 
that the available information suggests that N. galligena  rots are not as common in New Zealand as 
they are in Europe. 
6.73 New Zealand requests an addition to paragraph 7.569, in the section containing the Panel's 
analysis on the alleged overestim ation for importation step 3 for European canker.  New Zealand 
submits that this addition would reflect a key point fr om earlier paragraphs of the Panel's analysis and 
clarify the relationship of the section with importation step 3.  New Zealand also requests an addition to paragraph 7.583, in the section containing the Panel's analysis on the alleged overestimation for 
importation step 4 for European canker.  New Zeala nd submits that this addition is relevant to the 
IRA's consideration under importation step 4.
873  The Panel has added to paragraphs 7.569 and 7.583 
the text requested by New Zealand.  For consiste ncy, the Panel has also included additional language 
in paragraph 7.568. 
6.74 Australia requests that paragraph 7.584, in the section containing the Panel's analysis on the 
alleged overestimation for importation step 4 for Eu ropean canker, be amende d.  Australia submits 
that the quote of an expert's response is incomplete  and requests that the Panel delete the introductory 
part of the paragraph.874  New Zealand rejects Australia's reque st to amend this paragraph.  In 
New Zealand's view, the paragraph correc tly characterizes the expert's response.875  The Panel has 
amended paragraph 7.584, as requested by Australia.  The Panel has also included the complete text 
of the expert's response. 
6.75 New Zealand requests that the Panel add a footnote reference to the response of an expert to 
paragraph 7.614, in the section containing the Pane l's analysis on the alleged overestimation for 
importation step 6 for European canker.  New Zeala nd also requests that the Panel add a reference to 
the responses of two experts in a footnote to para graph 7.671, in the section containing the Panel's 
analysis on proximity for European canker.876  The Panel has inserted the references into paragraph 
7.614 and into footnote 1858 to paragr aph 7.671, as requested by New Zealand. 
6.76 In paragraphs 7.685, 7. 687, 7.689 and 7.712, in the section containing the Panel's analysis on 
exposure for European canker, New Zealand request s that the Panel replace the expression "clean 
fruit" with "new hosts", in order to reflect more  clearly the issue under exposure and establishment.877  
The Panel has made the replacement requested by New Zealand. 
6.77 New Zealand requests that the Panel insert a reference to experts' responses in footnotes to 
paragraphs 7.685, 7.689 and 7.699.878  The Panel has inserted the references into footnote 1884 to 
paragraph 7.685 and into footnote 1888 to paragra ph 7.689, as requested by New Zealand.  As to of 
the reference requested by New Zealand for paragrap h 7.699, the Panel considers it more appropriate 
to insert the reference into footnote 1901 to paragraph 7.698, instead. 
6.78 Australia requests that the Panel either delete th e whole paragraph 7.702, or at least the first 
sentence to that paragraph.  Australia submits that it is difficult to see how the Panel could consider 
                                                      
873 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 6. 
874 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 174-176. 
875 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 58. 
876 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, pp. 6-7. 
877 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 7. 
878 Ibid.  WT/DS367/R 
 Page 187 
 
 
 Australia's IRA to have failed to rec ognize the importance of the number of spores.879  New Zealand 
rejects Australia's request to amend this paragraph.   In New Zealand's view, the paragraph correctly 
characterizes the expert's response.880  The Panel sees no reason to delete  paragraph 7.702 or even the 
first sentence to that paragraph.  Having consid ered Australia's request, however, the Panel has 
slightly amended paragraph 7.702 for clarification.   For consistency, the Panel has also made the 
clarification in paragraphs 7.712, 7.729 a nd 7.1198, which refer to the same issue. 
6.79 Australia objects to several statements made by  the Panel in paragraph 7.729, in the section 
containing the Panel's conclusions regarding exposur e, establishment and spread for European canker.  
Australia submits that these statem ents, referring to the lack of scie ntific evidence or adequate support 
in the IRA on a number of issues, are factually incorrect.881  New Zealand rejects Australia's 
objections to this paragraph.  New Zealand disagrees with Australia's view that the Panel's statements 
are factually incorrect.882  Having considered Australia's request, the Panel sees no reason to amend 
paragraph 7.729. 
(f) Requirements regarding ALCM 
6.80 With respect to paragraphs 7.785, 7.786, 7.804,  7.866 and 7.1303, Australia requests that the 
Panel combine its consideration of the general issu e of viability of ALCM cocoons and the issue of 
parasitism, rather than considering both issues as potential cumulative errors.883  Although the two 
issues identified by Australia are linked, the Panel se es no impediment to consider each one separately 
and, consequently, there is no reason to amend pa ragraphs 7.785, 7.786, 7.804, 7.866 and 7.1303 in 
this regard. 
6.81 Australia requests that paragraph 7.789, in th e section describing the Parties' arguments on the 
issue of the available data on viability of ALCM co coons, be amended in order to clarify that the 15 
per cent figure cited is part of New Zealand's arguments.884  New Zealand rejects Australia's proposed 
amendment to this paragraph.885  In turn, New Zealand requests that the Panel insert a reference to 
New Zealand's second written submission in to footnote 2036 to paragraph 7.789.886  The Panel has 
amended paragraph 7.789, as requested by Australia.  The Panel has also inserted into footnote 2036 
the reference requested by New Zealand. 
                                                      
879 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 177-179. 
880 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 59. 
881 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 180-184. 
882 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, paras. 60-63. 
883 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 185-188. 
884 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 189-190. 
885 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 64. 
886 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 8. WT/DS367/R 
Page 188  
 
 6.82 Australia requests that paragraph 7.791 be am ended to appropriately reflect Australia's 
position.
887  New Zealand rejects Australia's proposed amendments to this paragraph.888  Having 
considered Australia's request, the Panel has made partial amendments  to paragraph 7.791. 
6.83 With respect to paragraphs 7.788 to 7.809, 7. 866, 7.1303 and 7.1308, Australia requests that 
the Panel revise its findings regarding the risk assess ment for ALCM.  In Australia's view, the Panel 
appears to have overlooked the fact that  the IRA contains two separate analyses.889  New Zealand 
rejects Australia's request, which, in New Zeala nd's view, is based on a misreading of the report.890  
Having considered Australia's request, the Panel sees no reason to amend its findings regarding the 
risk assessment for ALCM. 
6.84 As requested by New Zealand891, paragraph 7.794, in the section containing the Panel's 
analysis on the issue of the available data on viab ility of ALCM cocoons, has been amended, in order 
to identify all the findings of Tomkins et al. (1994), and not only those related to cocoon occupancy. 
6.85 Australia requests that paragraph 7.798 be am ended, so that the Panel acknowledge that 
certain data was submitted by New Zealand and only became available in the course of the 
proceedings.  Australia also requests that the Pa nel reflect Australia's submission regarding this 
information.892  New Zealand rejects Australia's proposed amendments to this paragraph.  In New 
Zealand's view, it is clear from the report that the da ta postdates the IRA.  With respect to Australia's 
second request, New Zealand submits that it is not appropriate to use the interim review as a 
mechanism to introduce new arguments.  New Z ealand adds that Australia's new arguments are 
factually inaccurate and largely irrelevant.893  Having considered Australia's request, the Panel has 
made partial amendments to paragraph 7.798, in  order to emphasize that the information became 
available during the proceedings having been subm itted by New Zealand at the time of its second 
written submission. 
6.86 As requested by New Zealand894, text that is relevant to the issue of the likely effect of 
factoring viability into importation step 2, has been included in the same paragr aph 7.794.  Australia's 
additional proposed text for this  paragraph and paragraph 7.799895 has been included in paragraph 
7.796, where it appears more appropriate. 
6.87 Australia requests that the second sentence of pa ragraph 7.819, in the section containing the 
Panel's analysis on the issue of the flight range fo r ALCM, be amended, so that the Panel's statement 
                                                      
887 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 191-192. 
888 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, paras. 65-67. 
889 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 193-195. 
890 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, paras. 68-69. 
891 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 8. 
892 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 196-198. 
893 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, paras. 70-74. 
894 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 8. 
895 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 199;  Communication from Australia to the Panel, 22 April 2010, Australia's comments on 
New Zealand's request for review of the interim report, paras. 5-6.  WT/DS367/R 
 Page 189 
 
 
 correctly reflects the opinion expressed by one of the experts.896  New Zealand rejects Australia's 
proposed amendment, because the paragraph correctly  characterizes the expert's view.  New Zealand 
adds that Australia's asser tion is unsupported by evidence submitted in the course of the 
proceedings.897  The Panel has amended the second sentence of paragraph 7.819 in order to reflect 
more closely the opinion expressed by the expert. 
6.88 With respect to paragraphs 7.822 to 7.837, 7. 852 to 7.863 and 7.866, Australia requests that 
the Panel revise its analysis and findings rega rding the IRA's assessment of the probability of 
establishment for ALCM.  In Australia's view, the Pa nel has not reflected nor evaluated the issue of 
how apple waste would be managed in Australia.898  New Zealand rejects Australia's request, which, 
in New Zealand's view, is inappropriate.  Ne w Zealand submits that Australia attempts to 
recharacterize New Zealand's arguments.  New Zealand adds that Australia's assertions are 
incorrect.899  Having considered Australia's request, the Panel sees no reason to amend its analysis and 
findings regarding the IRA's assessment of the probability of establishment for ALCM. 
6.89 As requested by New Zealand900, paragraphs 7.823, 7.835 and 7. 1284 have been amended to 
note that the reference to a 13-18 day timefram e in New Zealand's submissions was a proposed 
minimum time and not a range. 
6.90 Australia requests that paragraphs 7.827 to 7.829, in the section describing Australia's 
arguments on the issue of the period of ALCM emergen ce, be amended, so that the report fully reflect 
some of the points made by Australia.901  New Zealand rejects Australia's proposed amendments to 
these paragraphs.  In New Zealand's view, it is ne ither necessary nor appropriate to insert lengthy 
sections of Australia's submissions in this section, as Australia's arguments are set out in detail in 
other sections of the report.902  The Panel has inserted additional language in a new paragraph after 
paragraph 7.829, in order to address Australia's request. 
6.91 As requested by New Zealand903, a reference has been inserted into footnote 2165 to 
paragraph 7.854, in the section describing New Zeala nd's arguments on the issue of mode of trade for 
ALCM. 
6.92 Australia requests that paragraph 7.856, in th e section describing Australia's arguments on the 
issue of mode of trade for ALCM, be amended, so that the report acknowledge that New Zealand 
never contested the IRA's conclusions on a particular point.904  New Zealand rejects Australia's 
proposed amendment to this paragraph.  In New Zealand's view, Australia's assertion is factually 
                                                      
896 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 200-201. 
897 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 75. 
898 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 202-209. 
899 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, paras. 76-79. 
900 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 8;  Communication from Austra lia to the Panel, 22 April 2010, Australia's comments on 
New Zealand's request for review of the interim report, paras. 7-8. 
901 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 210. 
902 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 80. 
903 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 9. 
904 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 211-212. WT/DS367/R 
Page 190  
 
 inaccurate.
905  Having considered Australia's request, th e Panel sees no reason to amend paragraph 
7.856. 
6.93 Australia requests that the Panel delete the second sentence in paragraph 7.867, in the section 
containing the Panel's conclusions regarding th e IRA's estimation for the likelihood of entry, 
establishment and spread of ALCM.  In Australia's view, in this sentence the Panel inappropriately 
relies upon an expert's statement that did not rela te to the IRA's overall probability of entry, 
establishment and spread of ALCM, but was rather  made in the specific context of importation 
step 2.906  Having considered Australia's request, the Pa nel has partially amended paragraph 7.867, in 
order to clarify the manner in which the Panel took into account the expert's opinion in this regard. 
6.94 New Zealand requests that paragraph 7.869, in the section describing New Zealand's 
arguments on the issue of the potential biologi cal and economic consequences associated with 
ALCM, be amended, so that the report accurately reflect New Zealand's argument.  In the same 
paragraph, New Zealand requests the add ition of references in three footnotes.907  Australia rejects 
New Zealand's proposed amendment to this paragra ph.  In Australia's view, New Zealand should not 
be permitted to amend its arguments at the interim review stage.908  The Panel sees no reason to 
amend paragraph 7.869, in the manner requested by  New Zealand.  To avoid any misunderstanding, 
however, the Panel has made a small amendment in  the paragraph.  The Panel has included the 
references in footnotes requested by New Zealand. 
6.95 As requested by Australia909, paragraph 7.874 has been corrected. 
6.96 Australia requests that the Panel delete paragraph 7.876.  In Australia's view, in this paragraph 
the Panel inappropriately relies upon an expert's st atement that referred to the effects of a risk 
management measure, while the IRA consequences assessment was based on unrestricted risk.910  
Having considered Australia's request, the Pa nel has partially amended paragraph 7.876. 
6.97 As requested by New Zealand911, paragraph 7.883, in the section containing the Panel's 
overall conclusions with respect to require ments regarding ALCM, has been corrected. 
4. New Zealand's claim under Article 5.5 of the SPS Agreement 
6.98 Australia requests that the Panel amend pa ragraph 7.906, in the introductory section 
containing Australia's arguments, in order to provide a more accurate reflection of Australia's submission.
912  The Panel has amended paragra ph 7.906 as requested by Australia. 
                                                      
905 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 81. 
906 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 213-214. 
907 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 9. 
908 Communication from Australia to the Panel, 22 April 2010, Australia's comments on New Zealand's 
request for review of the interim report, paras. 9-11. 
909 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 215-216. 
910 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 217-218. 
911 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 9.  See also, communication from Australia to the Panel, 22 April 2010, Australia's 
comments on New Zealand's request for review of the interim report, paras. 12-13.  WT/DS367/R 
 Page 191 
 
 
 6.99 Australia requests that the Panel replace the reference to "ALOP" (appropriate level of 
protection) with "level of protection"in paragraphs  7.933 and 7.958, as well as in a subheading in page 
390 of the interim report.  In Australia's vi ew, the latter expression is more appropriate.913  
New Zealand rejects Australia's proposed amendmen t.  In New Zealand's view, Australia has not 
explained why the expression "level of protection"  should be preferred.  New Zealand adds that 
"appropriate level of protection" has been used by the Appellate Body.914  Having considered 
Australia's request, and noting that the expression "appr opriate level of protectio n" is contained in the 
SPS Agreement and has been used by the Appellate B ody and previous panels in this context, the 
Panel sees no reason to replace the expression. 
6.100  Australia requests that the Panel amend paragra phs 7.946 and 7.947 to clarify that the Panel's 
statements contained in those paragraphs are sp ecific to the comparability test, and not necessarily 
relevant for the remaining elements of an Article 5.5 analysis.915  The Panel has amended paragraphs 
7.946 and 7.947, as requested by Australia. 
6.101  Australia requests that the Panel amend paragr aph 7.947 to reflect Australia's position more 
accurately.  Australia also requests that the Pane l correct a reference in footnote 2300 to paragraph 
7.947.916  New Zealand considers that Australia's proposed amendment is unnecessary, as it is already 
reflected in the paragraph.917  The Panel has amended paragraph 7. 947, as requested by Australia, and 
corrected the reference in footnote 2300. 
6.102  Australia requests that the Panel amend paragr aph 7.986 to qualify a Panel's statement by 
making it clear that it is a direct result of the nature  of New Zealand's claims.  Australia suggests that 
the Panel delete the first sentence of the paragraph.918  New Zealand considers that paragraph 7.986 is 
clear and does not require modification.919  The Panel has amended paragraph 7.986. 
6.103  Australia requests that the Panel amend paragraph 7.1035 to make it clear that when the Panel 
refers to two factors being inconclusi ve, it is referring to New Zealand's case.920  New Zealand 
considers that paragraph 7.1035 is  clear and does not require modifi cation.  In New Zealand's view, 
the Panel's statement in that paragraph refers to  the relative risk of the comparable situations.921  The 
Panel has amended paragraph 7.1035, to clarify the Panel's statement. 
                                                                                                                                                                     
912 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 219-221. 
913 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 222-223 and 231. 
914 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 82. 
915 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 224-227. 
916 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 228-230. 
917 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 83. 
918 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 232-233. 
919 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 84. 
920 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 234-236. 
921 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 85. WT/DS367/R 
Page 192  
 
 6.104  Australia requests that the Panel amend pa ragraph 7.1060, because it does not accurately 
reflect Australia's arguments.
922  New Zealand rejects Australia's request.  In New Zealand's view, 
Australia's proposed change would ch ange the meaning of the paragraph.923  The Panel has amended 
paragraph 7.1060, to clarify the Panel's statement. 
6.105  Australia requests that the Panel revise its findi ngs contained in paragraphs 7.1064 to 7.1067, 
regarding the presence of the two pests in exports areas.924  New Zealand agrees with the Panel's 
conclusions in paragraphs 7.1064 to 7.1067 and rejects Australia's request.925  Having considered 
Australia's request, the Panel sees no reason to amend the findings contained in  paragraphs 7.1064 to 
7.1067. 
6.106  As requested by New Zealand926, the word "certified" has been deleted from the first sentence 
in paragraph 7.1071. 
5. New Zealand's claim under Article 5.6 of the SPS Agreement 
6.107  Australia requests that the Panel amend the last  sentence in paragraph 7.1095, in the section 
describing the Panel's approach to assessing New Zeal and's claim.  In Australia's view, this sentence 
does not accurately reflect Australia's primary argument under Article 5.6.927  The Panel has amended 
the last sentence in paragraph 7.1095, as requested by Australia. 
6.108  Australia requests that the Panel amend para graph 7.1132, in the sec tion on the measures at 
issue regarding fire blight and European canker.  Australia considers that th is paragraph contains a 
criticism of Australia's qualitative ALOP.  Australia requ ests that, if the Panel retains this material, it 
acknowledge that Members are under no obligation to quantify their ALOP and the difficulties a Member would face if it attempted to do so.
928  Having considered Australia's request, the Panel sees 
no reason to amend paragraph 7.1132. 
6.109  With respect to paragraphs 7.1135 and 7.1137,  Australia requests that the Panel include a 
statement to the effect that co mpliance with the SPS Committee's Guidelines to further the practical 
implementation of Article 5.5  and with the various ISPMs is not mandatory and that these documents 
do not set out enforceable obligations.929  Having considered Australia 's request, the Panel sees no 
reason to amend paragraphs 7.113 5 and 7.1137.  The report discusses in its descriptive section the 
nature of ISPMs.  The Panel has included, how ever, a clarification regarding the SPS Committee's 
Guidelines to further the practical  implementation of Article 5.5  in footnote 2277 to paragraph 7.927. 
                                                      
922 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 237-238. 
923 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 86. 
924 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 239-240. 
925 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 87. 
926 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 10. 
927 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 241-242. 
928 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 243. 
929 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 246.  WT/DS367/R 
 Page 193 
 
 
 6.110  Australia requests that the Panel delete paragra ph 7.1136, or otherwise amend the paragraph.  
In Australia's view it would be more correct to st ate that measures selected must reflect the ALOP.  
Australia also submits that this paragraph is  unnecessary as the relevant point has been addressed 
elsewhere.930  New Zealand rejects Australia's request a nd considers that paragraph 7.1136 correctly 
states the relevant requirements.931  Having considered Australia's request, the Panel sees no reason to 
amend paragraph 7.1136. 
6.111  Australia requests that the Panel amend pa ragraph 7.1138, in order to include an 
acknowledgement that, in some circumstances, the unrestricted risk may exceed the ALOP by only a small amount, but there may be only relatively stringe nt measures reasonably available and capable of 
reducing the risk to achieve the ALOP.
932  Having considered Australia's  request, the Panel sees no 
reason to amend paragraph 7.1138. 
6.112  Australia requests that the words "and to the exte nt that" be deleted from the last sentence in 
paragraph 7.1139.933  The Panel has amended paragraph 7.1139, as requested by Australia. 
6.113  Australia requests that the Panel amend paragr aph 7.1141.  Australia considers that it is 
inappropriate for the Panel to rely on the expert s to reach the conclusion that the IRA's analysis 
regarding some of the importation steps was exaggera ted.  Specifically, Australia requests the deletion 
of two statements and suggests an alternative text .  Australia also requests the Panel to replace the 
word "negligible" in subparagraph (g) with the IRA's actual finding for importation step 7.934  
New Zealand rejects Australia's request and considers that there is nothing inappropriate in the Panel's 
analysis in paragraph 7.1141.935  Having considered Australia's  request, the Panel sees no reason to 
amend paragraph 7.1141. 
6.114  Australia requests that the Pane l amend paragraph 7.1151, to ac knowledge that the underlying 
basis of the IRA's analysis for fire blight and European canker was predominantly concerned with 
mature, symptomless apples.  Australia also requ ests the Panel to list the number of other potential 
measures which the IRA evaluated for fire blight and European canker.936  Having considered 
Australia's request, the Panel has amended paragra ph 7.1151 to note Australia's statement that the 
IRA's analysis for fire blight and European canker was predominantly concerned with mature, 
symptomless apples. 
6.115  Australia requests that the Panel delete the wo rd "theoretical" from the first sentence in 
paragraph 7.1180.  Australia submits that this word was not used by the experts.937  Having 
considered Australia's request, the Pane l sees no reason to amend paragraph 7.1180. 
                                                      
930 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 244-245. 
931 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 88. 
932 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 247-248. 
933 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 249-250. 
934 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 251-255. 
935 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, paras. 89-90. 
936 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 256-258. 
937 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 259-260. WT/DS367/R 
Page 194  
 
 6.116  Australia requests that the Panel revise para graph 7.1191.  In Australia's view, it is 
inappropriate for the Panel to rely on experts to confirm that certain events  will occur, which are a 
matter of practical implementati on and enforcement by New Zeala nd and Australian authorities.  
Australia also requests that footnote 2629 to the paragraph be corrected.
938  Having considered 
Australia's request, the Panel has ame nded paragraph 7.1191 and footnote 2629. 
6.117  New Zealand requests that the Panel amend subparagraph (c) in paragraph 7.1194.  
Specifically, New Zealand requests the insertion of text  to reflect key points from the Panel's analysis 
under importation step 3.939  The Panel has amended subparagraph (c), as requested by New Zealand. 
6.118  With respect to paragraphs 7.1287 and 7.1288, in the section on the measures at issue 
regarding ALCM with respect to New Zealand's claim under Article 5.6 of the SPS Agreement, 
Australia requests that the Panel make it clear that the statements regarding what the experts allegedly 
confirmed or endorsed represent New Zealand's opinion , rather than the Panel's.  Australia also 
requests that footnote 2786 to paragraph 7. 1287 be correspondingly deleted or corrected.940  
New Zealand rejects Australia's request and especi ally the revision of the footnote to paragraph 
7.1287.941  The Panel has amended paragraphs 7.12 87 and 7.1288, as well as footnote 2786 to 
paragraph 7.1287, to address Australia's request. 
6.119  As requested by New Zealand942, paragraph 7.1304 has been corrected. 
6.120  Australia requests that the Panel amend paragr aph 7.1335.  Specifically, Australia requests 
that the Panel reflect Australia's response to New Zealand's argument.943  The Panel has included 
Australia's proposed text in paragraph 7.1341, in the section describing Australia's arguments. 
6.121  The Panel has amended paragraph 7.1336, to address Australia's request.944 
6.122  Australia requests that the Panel amend paragr aph 7.1337.  Specifically, Australia requests 
that the Panel reflect Australia's response to New Zealand's argument.945  The Panel has included 
Australia's proposed text in paragraph 7.1342, in the section describing Australia's arguments. 
6.123  Australia requests that the Panel delete part of pa ragraph 7.1338.  In Aust ralia's view, this part 
relates to Australia's measures regarding fire blight  and European canker and is irrelevant for ALCM 
measures.946  The Panel notes that the paragraph in ques tion explains that, according to New Zealand, 
                                                      
938 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 261-262. 
939 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 11. 
940 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 263-265. 
941 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 91. 
942 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, pp. 11-12.  See also, communication from Australia to the Panel, 22 April 2010, Australia's 
comments on New Zealand's request for review of the interim report, paras. 12-13. 
943 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 266-268. 
944 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 269. 
945 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 270-271. 
946 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 272-273.  WT/DS367/R 
 Page 195 
 
 
 certain arguments and factors set out in the contex t of the other two pests also apply to ALCM.  
Having considered Australia's request, the Pa nel sees no reason to ame nd paragraph 7.1338. 
6.124  Australia requests that the Panel amend paragr aph 7.1354.  Specifically, Australia requests 
that the Panel delete a sentence stating that bot h Parties agree that a 3,000-unit inspection would 
effectively result in a fumigation of all lots.947  The Panel has amended paragraph 7.1354, to address 
Australia's request. 
6.125  Australia requests that the Panel amend paragr aph 7.1355.  Specifically, Australia requests 
that its responding arguments be reflected in this section of the report.948  New Zealand rejects 
Australia's request.  In New Zealand's view, Austra lia's arguments are reflected in other sections of 
the report and it would not be necessary nor appropr iate to insert lengthy parts of Australia's 
submissions in this section.  New Zealand also  subm its that Australia's proposed text is irrelevant to 
the issue addressed in this section.949  Having considered Australia's request, the Panel sees no reason 
to amend paragraph 7.1355. 
6. New Zealand's claims under Article under Article 8 and Annex C(1)(a) of the SPS 
Agreement 
6.126  As requested by New Zealand, the Panel h as amended paragraph 7.1407, in a sentence 
summarizing New Zealand's claims. 950 
6.127  New Zealand requests that the Panel amend paragr aphs 7.1415 to 7.1418, 7.1447 and 7.1448.  
In New Zealand's view, these paragraphs erroneously suggest that New Zealand argued that the IRA as a whole was a measure in and of itself.
951  Australia rejects New Zealand's request.  In Australia's 
view, New Zealand is attempting to retrospectively repair its undue delay argument as reflected in the 
report.  Australia submits that it is important that the report reflect New Zealand's arguments and that 
New Zealand should not be permitted to rem ove the reference to its original claim.952  Having 
considered New Zealand's request, the Panel sees no reason to amend paragr aphs 7.1415 to 7.1418, 
7.1447 and 7.1448. 
6.128  As requested by New Zealand, the Panel h as amended paragraph 7.1423, in a sentence 
summarizing New Zealand's claims. 953 
6.129  Australia requests that the Panel amend paragr aph 7.1431.  Specifically, Australia submits 
that the paragraph does not accurately reflect Australia's position.954  The Panel has amended 
paragraph 7.1431, to address Australia's request. 
                                                      
947 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 274-275. 
948 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 276-277. 
949 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 92. 
950 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 12. 
951 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 12. 
952 Communication from Australia to the Panel, 22 April 2010, Australia's comments on New Zealand's 
request for review of the interim report, paras. 14-16. 
953 Communication from New Zealand to the Panel, 15 April 2010, New Zealand's request for review 
of the interim report, p. 12. WT/DS367/R 
Page 196  
 
 6.130  Australia requests that the Panel amend paragr aph 7.1434.  Specifically, Australia submits 
that the paragraph is not an accurate reflection of Au stralia's arguments.  Australia also requests that 
the Panel correct a footnote to the paragraph.
955  As requested by Australia, the Panel has amended 
paragraph 7.1434, and corrected footnote 3020. 
6.131  Australia requests that the Panel delete the l ast sentence of paragraph 7.1459.  Australia 
submits that this sentence is not an accurate reflecti on of Australia's position.  Alternatively, Australia 
suggests alternative text for this section.956  New Zealand does not object to the deletion of the 
sentence, but it rejects Australia's proposed alternative language.957  As requested by Australia, the 
Panel has deleted the last sentence of paragraph 7.1459. 
6.132  Australia requests that the Panel delete sever al sections and make other amendments in 
paragraphs 7.1459 to 7.1462.  Au stralia submits that it is unnecessary for the Panel to make comments 
on the question of whether an IRA-type process could be a procedure within the meaning of 
Annex C(1)(a) of the SPS Agreement.958  New Zealand objects to the changes and deletions proposed 
by Australia. In New Zealand's view, Australia's re asons for requesting the deletions are incorrect.  
New Zealand adds that the passages in these paragra phs are important and should be retained and that 
Australia's suggested amendments are in appropriate and should be rejected.959  Having considered 
Australia's request, the Panel sees no reason to amend paragraphs 7.1459 to 7.1462. 
C. MINOR CORRECTIONS AND ADDITION OF REFERENCES  
6.133  Minor corrections were made to the following pa ragraphs of the interim report, as a result of 
comments from New Zealand:  2.24, 4.458, 4.459, 4.460, 4.467, 7.229, 7.245, 7.248, 7.252, 7.255, 7.285, 7.333, 7.338, 7.350, 7.358, 7.414, 7.417, 7.4 28, 7.443, 7.447, 7.512, 7.525, 7.540, 7.568, 7.569, 
7.595, 7.607, 7.621, 7.798, 7.901, 7.1047, 7.1049, 7.1141, 7.1143, 7.1144, 7.1152, 7.1164, 7.1198, 
7.1249, and 7.1250. 
6.134  Likewise, comments from New Zealand resulted in minor corrections to the following 
footnotes in the interim report:  footnote 1167 to pa ragraph 7.231, footnote 1186 to paragraph 7.240, 
footnote 1187 to paragraph 7.241, footnote 1194 to paragraph 7.246, foot note 1217 to paragraph 
7.258, footnote 1528 to paragraph 7.447, footno te 1530 to paragraph 7.449, footnote 2211 to 
paragraph 7.885, footnote 2506 to  paragraph 7.1118, footnote 2507 to paragraph 7.1118, footnote 
2509 to paragraph 7.1120, and f ootnote 2600 to paragraph 7.1165. 
6.135  As a result of comments from New Zealand, additional references have been added into 
existing footnotes or have been inserted as new footno tes:  the addition of a new footnote to paragraph 
7.61, the addition of a new footnote  to paragraph 7.180, the additio n of a new footnote to paragraph 
7.375, the addition of two new footnotes to paragr aph 7.427, the addition of a new reference in 
footnote 1607 to paragraph 7.496, the addition of two new footnotes to paragraph 7.540, the addition 
of a new footnote to paragraph 7.568, the additi on of new references in footnote 1901 to paragraph 
                                                                                                                                                                    
 
954 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 278-279. 
955 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, para. 280. 
956 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 281-284. 
957 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, para. 93. 
958 Communication from Australia to the Panel, 15 April 2010, Australia's request for review of the 
interim report, paras. 285-287. 
959 Communication from New Zealand to the Panel,  22 April 2010, New Zealand's comments on 
Australia's request for review of the interim report, paras. 94-96.  WT/DS367/R 
 Page 197 
 
 
 7.698, the addition of new references in footnote  2036 to paragraph 7.789,  the addition of a new 
footnote to paragraph 7.798, the addition of a new reference in footnote 2182 to paragraph 7.869, the 
addition of a new reference in footnote 2183 to para graph 7.869, the addition of a new reference in 
footnote 2185 to paragraph 7.869, the addition of a new footnote to paragraph 7.955, the addition of a 
new footnote to paragraph 7.1122, the addition of  a new reference in footnote 2674 to paragraph 
7.1213, the addition of a new reference in footnote 2677 to paragraph 7.1216. 
6.136  Australia did not request any additional minor corrections. 
6.137  In addition to the above, the Panel has made cl erical corrections to paragraphs 1.21, 1.41, 
1.51, 1.54, 2.1, 2.39, 2.91, 4.80, 7.57, 7.79, 7.151, 7.166, 7.175, 7.184, 7.860, 7.1017, 7.1134, 7.1335 and 7.1405, and to the following footnotes in the interim report:  footnote 151 to paragraph 2.6, 
footnote 754 to paragraph 7.7, footnote 834 to pa ragraph 7.52, footnote 837 to paragraph 7.57, 
footnote 851 to paragraph 7.75, footnote 854 to paragraph 7.79, footnote 930 to paragraph 7.115, 
footnote 933 to paragraph 7.116, footnote 940 to pa ragraph 7.121, footnote 997 to paragraph 7.151, 
footnote 1053 to paragraph 7.185, footnote 1880 to paragraph 7.683, foot note 1913 to paragraph 
7.708, footnote 2228 to paragraph 7.893, footnot e 2373 to paragraph 7.1015 and footnote 2407 to 
paragraph 7.1030.  The Panel also revised the list of  abbreviations and added a reference to five panel 
or Appellate Body reports that were missing fro m the table of cases cited in the interim report. 
VII. FINDINGS 
A. A
USTRALIA 'S CONCERNS WITH THE EXPERT SELECTION AND CONSULTATION PROCESS  
7.1 Australia has raised concerns with specific aspects of the Panel's processes for selecting and 
consulting the scientific experts.960 
7.2 In regard to the expert selection, Australia contests: 
(a) That only one expert was selected in the area of ALCM;  and, 
(b) The alleged connection of the Panel's sole  ALCM expert with the complainant, 
New Zealand. 
7.3 As regards expert consultation, Australia's con cerns fall into the following main categories: 
(a) The alleged lack of opportunity for Australia to comment on new or modified 
questions and on the Panel's lim ited scope for some questions; 
(b) The Panel's reference in its ques tions to third party submissions; 
(c) The experts allegedly providing information that went beyond the scope of the Panel's 
questions961;  and, 
(d) The experts' alleged lack of competence in certain areas in which the Panel posed 
questions or the experts expressed opinions and the Panel's use of the experts in areas 
that were outside of the field of expertise for which each expert was selected.962 
                                                      
960 See, for example, Australia's communica tions to the Panel, 9 December 2008 and 
19 December 2008.  Australia's subsequent subm issions followed these previous communications. 
961 See, for example, Australia's comments on the experts' replies to questions, para. 14. 
962 See, for example, Australia's comments on the experts' replies to questions, paras. 13 and 17. WT/DS367/R 
Page 198  
 
 1. Qualification of concerns expressed by Australia 
7.4 Australia has qualified a number of the concerns  described above with respect to the Panel's 
procedure to select and consult experts as "concerns  regarding the observance of due process in the 
experts phase of this dispute".
963  These "due process concerns" raised by Australia relate to whether 
Australia was given the opportunity to comment on new or amended questions posed by the Panel and 
whether some of the scientific experts consulted by the Panel moved outside of the field of expertise 
for which they had been selected.964 
7.5 Any legal proceeding, including WTO proceedi ngs, may raise procedural concerns for the 
parties involved.  By definition, due process concer ns are of a procedural nature.  However, not all 
procedural concerns necessarily affect due process.  In response to a question by the Panel, Australia 
accepted the validity of a distinction between proce dural concerns that affect due process and other 
"minor procedural concerns": 
"[D]ue process can be understood in the context of WTO disputes as comprehending 
the protection of a party's right to a fair hearing.  As such, this protection must be applied at every stage of a panel's proceedings, including, in the present case, the 
Panel's selection of, and consultation with, the experts. 
The distinction drawn in the Panel's ques tion between procedural concerns and due 
process concerns appears to suggest that the former would be of less significance than 
a due process concern.  Australia considers that minor procedural concerns would not prejudice a party's right to a fair hearing."
965 
7.6 Australia notes that its argument regarding the information provided by the experts that 
allegedly went beyond the scope of the Panel's re levant questions "was not intended to raise a due 
process concern".966  Arguably, this concern would therefore fall in the category of "minor procedural 
concerns". 
7.7 The concept of due process is imp licit in WTO dispute settlement.967  In the words of the 
Appellate Body, due process constitutes "an obliga tion inherent in the WTO dispute settlement 
system"968, and it is "fundamental to ensuring a fair  and orderly conduct of dispute settlement 
proceedings."969  Due process ensures a fair hearing for the parties to a dispute, through an adequate 
opportunity to submit claims, arguments and eviden ce and to respond to the claims, arguments and 
evidence presented by the other party.970  Thus, due process also ensures procedural equality between 
the parties by "guarantee[ing] that the proceedings  are conducted with fairness and impartiality, and 
that one party is not unfairly disadvantaged w ith respect to other parties in a dispute."971  Ultimately, 
                                                      
963 Australia's comments on the experts' replies to questions, para. 15. 
964 Australia's comments on the experts' replies to questions, paras. 16-17. 
965 Australia's reply to Panel question 20 after the second substantive meeting, paras. 69-70. 
966 Australia's reply to Panel question 20 after the second substantive meeting, para. 71. 
967 Appellate Body Report on Canada – Continued Suspension , para. 435, where the Appellate Body 
explains that "due process considerations are reflected in the Rules of Conduct. "  No reference is made to the 
DSU.  Also, in India – Patents (US) , para. 94, the Appellate Body recognizes that "...demands of due process ... 
are implicit in the DSU..." 
968 Appellate Body Report on Chile – Price Band System , para. 176. 
969 Appellate Body Report on Thailand – H-Beams , para. 88.  See also the Appellate Body Report on 
Canada – Continued Suspension , para. 433. 
970 Appellate Body Report on Canada – Continued Suspension , para. 434. 
971 Appellate Body Report on Canada – Continued Suspension , para. 433.  WT/DS367/R 
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 due process ensures an objective assessment of the ma tter by panels, as mandated by Article 11 of the 
DSU.972 
7.8 According to the Appellate Body, due process fu lly applies to the selection and consultation 
of experts by panels:  "[T]he prot ection of due process applies to a pane l's consultations with experts.  
This due process protection applies to the process fo r selecting experts and to the panel's consultations 
with the experts, and continu es throughout the proceedings."973 
7.9 If a procedural concern puts at risk the purpose and role of due process in WTO dispute 
settlement, it is effectively a due process concern, to  which panels need to pay special attention.  
However, it is difficult to state in the abstract wh ether a specific type of procedural concern affects 
due process.  Only by taking in to account the specific circumstan ces of the case, can a panel assess 
whether a procedural concern affects due process and thus merits such special attention. 
7.10 Accordingly, when analysing the various con cerns raised by Australia, on the selection and 
consultation of experts in this dispute, the Panel will pay special attention to determine whether due 
process has been prejudiced and whether as a resu lt Australia has been unfairly disadvantaged. 
2. Selection of experts 
(a) The Panel's selection of only one ALCM expert 
7.11 During the expert selection process, Australia e xpressed its preference that the Panel seek the 
advice of two experts on each of the three pests at  issue (fire blight, European canker and ALCM).974  
In Australia's view, this would ensure that the Panel "receives advice from a sufficiently diverse pool 
of expertise".975  Australia reiterated this concern after the Panel had selected Dr Jerry Cross as the 
sole expert on ALCM.976 
7.12 In turn, New Zealand considered adequate that  the Panel select one expert for each of the 
three pests and, in any event, no mo re than two experts for each pest.977  New Zealand did not raise 
any objection to the selection of Dr Cross as the sole ALCM expert. 
7.13 Neither Article 13 of the DSU, nor Article 11.2 of the SPS Agreement, which jointly provide 
the legal basis for WTO panels to seek the advice of  experts in SPS disputes, specify the number of 
experts that should be selected for each particular issue.  Likewise, the Panel's Working Procedures, 
adopted after having consulted the Parties, do not re fer to a specific number of experts:  "The Panel 
will decide the number of experts in light of the number and type of issues on which advice will be 
sought, as well as of the different areas on which each expert can provide expertise."978 
7.14 The Panel extensively consulted the Parties throughout the expert selection process.  In 
accordance with the Panel's Workin g Procedures and the views expressed by the Parties, the Panel 
asked the Secretariat of the specialized internationa l agency on plant health – the International Plant 
Protection Convention (IPPC) –, the Council for In ternational Congresses of Dipterology (CICD), as 
                                                      
972 Appellate Body Report on US – Gambling , para. 273. 
973 Appellate Body Report on Canada – Continued Suspension , para. 436. 
974 See, for example, Australia's communicatio ns to the Panel, 4 September 2008 and 
20 November 2008. 
975 Australia's communications to the Panel, 20 November 2008. 
976 Australia's communication to the Panel, 19 December 2008. 
977 New Zealand's communications to the Panel,  11 September 2008 and 9 December 2008. 
978 Working Procedures, 26 March 2008, attached as Annex A-3 to this report, para. 17(d). WT/DS367/R 
Page 200  
 
 well as the Parties, for suggesti ons of names of possible experts.
979  Each of these steps was done after 
consultation with the Parties.980 
7.15 The Panel consulted the IPPC Secretariat on 15  September 2008, to ask for suggestions of 
experts in the four areas identified by the Panel (each of the three pests at issue, as well as pest risk 
assessment).981  On 23 September 2008, the IPPC Secret ariat provided a list with ten potential 
experts982, from which only four confirmed their interest a nd availability to assist the Panel.  None of 
these four persons was an expert on ALCM.  The IPPC Secretariat stated it had difficulties finding suitable ALCM experts, but suggested that with more time it could provide additional names of 
experts in this field.
983  This situation delayed the proceedi ngs and required the Panel to amend the 
timetable.984  At the end of October 2008, the IPPC  Secretariat proposed 12 additional names.985  Four 
of them confirmed their interest and availability.  Again, none of these four persons were experts on 
ALCM.  Accordingly, the Panel asked the Pa rties to suggest names of experts on ALCM.986  I n  
response to the Panel's request, New Zealand suggest ed one ALCM expert, Dr Jerry Cross, "as having 
relevant experience and expertise", and noted th at it would not object to having only one ALCM 
expert, considering the various difficulties in  finding appropriate a nd available experts.987  Australia 
did not propose any expert on ALCM, but suggested that the Panel contact the Council for 
International Congresses of Dipterology (CICD), to ask for names of ALCM experts.988 
7.16 In the light of Australia's suggestion, on 25 November 2008 the Panel contacted the CICD.989  
In response, on 26 November 2008 the Chairman of the CICD suggested one ALCM expert, noting that this expert might be able to sugge st further names on behalf of the CICD.
990  Through contact 
with the expert suggested by the CICD, the Pa nel found another ALCM expert, which raised the 
number of potential ALCM experts to three:  one  proposed by New Zealand, one proposed by the 
CICD and one proposed by the expert suggested by the CICD.991  These three names of ALCM 
experts were submitted to the Parties for comments.992  For different reasons, all three ALCM experts 
were objected to by at least one of the Parties.993  The expert proposed by the CICD was objected to 
by both Parties, because he was not available to meet with the Panel and the Parties in Geneva.994  The 
expert proposed by the expert suggested by the CI CD was also objected to by both Parties, on the 
grounds that his expertise was limited to midge ta xonomy and that he had limite d relevant experience 
on pest management or field ecology.995  The remaining available expert, Dr Jerry Cross, was objected 
                                                      
979 Working Procedures, 26 March 2008, attached as Annex A-3 to this report, para. 17(b). 
980 See, for example, Australia's communications to the Panel, 20 March 2008 and 4 September 2008, 
and New Zealand's communication to the Panel, 11 September 2008. 
981 Panel's communication to the IPPC, 15 September 2008. 
982 Electronic communication from the IPPC to the Panel, 23 September 2008. 
983 Ibid. 
984 Electronic communication from the Panel to the Parties, 31 October 2008. 
985 Electronic communications from the IPPC to the Panel, 29 and 30 October 2008. 
986 Panel's communication to the Parties, 13 November 2008. 
987 New Zealand's communication to the Panel, 20 November 2008. 
988 Australia's communication to the Panel, 20 November 2008. 
989 Panel's communication to the CICD, 25 November 2008. 
990 Electronic communication from th e Chairman of the CICD to th e Panel, 26 November 2008. 
991 Panel's communication to the Parties, 5 December 2008. 
992 Ibid. 
993 Parties' communication to the Panel, 9 December 2008. 
994 New Zealand's communication to the Panel, 9 December 2008, and Australia's communication to 
the Panel, 9 December 2008. 
995 Ibid.  WT/DS367/R 
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 to by Australia on the grounds of an alleged c onnection with the New Zealand Government and 
New Zealand researchers.996 
7.17 On 15 December 2008, the Panel informed the Pa rties that it had selected a total of seven 
experts.997  Two experts were selected on the basis of th eir qualifications and specialized expertise on 
fire blight, European canker and pest risk assessment , respectively, while one of the experts, Dr Jerry 
Cross, was selected for his expertise on ALCM. 
7.18 As described in the preceding paragraphs, the main reason for selecting only one expert on 
ALCM was the limited pool of available experts on this particular pest. 
7.19 The Panel formally began its expe rt selection process on 15 September 2008998 and finalized 
it on 15 December 2008.999  During this three-month period, the Panel consulted specialized agencies 
and the Parties for names of possible experts.  Du e to the problems that the Panel faced in finding 
scientific experts, especially on ALCM, the timetable of the dispute was amended in November 2008, 
and the proceedings were delayed. 
7.20 As noted earlier, neither the DSU, the SPS Agre ement, nor the Panel's Working Procedures 
specify the number of experts to be selected.  Accordingly, it was ultimately within the Panel's 
authority to decide on the number of experts accordi ng to the specific circumstances of the dispute, 
the necessary expertise and the constraints faced.  In a ddition, the Panel is bound  by Article 3.3 of the 
DSU to seek a prompt settlement of the dispute.  The Panel noted, however, Australia's expressed 
preference for two experts to be consulted in each of th e three relevant pests.  In general, more experts 
might provide more advice than just one expert and this might be useful to a panel.  But this does not imply that consulting one competent expert would no t be sufficiently useful for a panel in a given 
dispute, that this would necessarily narrow the range of scientific expert advice that the Panel would 
receive, nor that the parties would be prejudiced by the selection of only one expert on a given subject.  Despite the delay, and the recourse to sp ecialized agencies and the Parties, the Panel was 
unable to find a larger number of qualified and av ailable ALCM experts.  In the particular 
circumstances of this case, the Panel had to decide  whether to proceed with one selected available 
expert, with a high degree of expe rtise as demonstrated by his qualifications, or further delay the 
proceedings by extending the search  for a second expert on the specific pest.  Given that the Panel had 
already consulted the leading agencies and the Par ties themselves, there was no guarantee that this 
further delay would have resulted in finding a su itable additional expert on ALCM.  There was, 
however, the possibility that, with any additional pos tponement, any of the experts already confirmed 
could become unavailable.  In the Panel's view, further delaying the selection process would have 
been inappropriate, as it would have hindered the objective of seek ing a prompt settlement of the 
dispute, contrary to Article 3.3 of the DSU and the expressed interest of both Parties.
1000  In the light 
of the above, the Panel decided to seek the advice of only one expert on ALCM, rather than two, as in 
the case of the two other pests and th e issue of pest risk assessment. 
7.21 In any event, there is no indication that the selection of one expert on ALCM has prejudiced 
the Parties' rights in this dispute or impaired th e Panel's ability to conduct an  objective assessment of 
the matter before it.  This selection in no way u ndermines the fairness and impartiality of the 
proceedings, nor the ability of the Panel to obtain sufficient specialized scien tific expertise.  In 
particular, Australia has not demonstrated that  it suffered any kind of prejudice by the Panel 
                                                      
996 Australia's communication to  the Panel, 9 December 2008. 
997 Panel's communication to the Parties, 15 D ecember 2008. 
998 Ibid. 
999 Ibid. 
1000 See, for example, Australia's communica tion to the Panel, 20 November 2008. WT/DS367/R 
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 consulting only one ALCM expert.  The Panel w ill address the substance of Australia's specific 
objections to the selection of Dr Cross in the following section. 
(b) The alleged connection of the ALCM expert with the complainant 
7.22 Australia objected, under paragraph 17(c) of the Panel's Working Procedures, to 
Dr Jerry Cross being consulted as an expert by the Panel, given Dr Cross's "connection with the 
New Zealand Government and New Zealand researchers".
1001  Australia references joint research 
projects and publications, cited by Dr Cross in his curriculum vitae , which – Australia argues – were 
jointly undertaken with researchers from HortRes earch New Zealand.  In particular, Australia 
references a "joint publication with Suckling et al., published in 2007, which indicates a very recent 
connection with relevant New Zealand researchers, whose work is primarily targeted at facilitating 
access for New Zealand apples to export markets."1002 
7.23 New Zealand responds that Australia's objecti on is "without basis".  Dr Cross has no 
connection with the New Zealand Government relevant for the present dispute.1003  His preliminary 
conflict of interest statement indicates that he has not received funding from the New Zealand Government in relation to the activity with Ne w Zealand researchers and his collaboration with 
New Zealand experts can be no basis for a compelling objection.
1004 
7.24 Under the Rules of Conduct for the DSU applicab le to all covered persons in WTO dispute 
settlement, experts "shall be independ ent and impartial, shall avoid direct or indirect conflicts of 
interest ... pursuant to the dispute settlement mech anism, so that through the observance of such 
standards of conduct the integrity and impartiality of that mechanism are preserved".1005  In 
accordance with the Working Procedures adopted by the Panel, potential experts were asked to submit 
a statement of potential conflict of interests, pr ior to their selection, which was copied to the 
Parties.1006  Like other persons covered by the Ru les of Conduct, experts "shall disclose any 
information that could reasonably be  expected to be known to them at  the time which, coming within 
the scope of the Governing Principle of these Rules, is  likely to affect or give rise to justifiable doubts 
as to their independence or impartiality."1007  According to the Illustrative List annexed to the Rules of 
Conduct, this disclosure shall in clude information relating to: 
"(a) financial interests (e.g. investments, loans, shares, interests, other debts);  
business interests (e.g. directorship or othe r contractual interests);  and property 
interests relevant to the dispute in question; 
(b) professional interests (e.g. a past or present relationship with private clients, 
or any interests the person may have in domestic or international proceedings, and 
their implications, where these involve issues similar to those addressed in the dispute 
in question); 
                                                      
1001 Australia's communication to the Panel, 9 Decem ber 2008.  This objec tion was maintained in 
Australia's communication to the Panel, 19 December 2008. 
1002 Australia's communication to  the Panel, 9 December 2008. 
1003 New Zealand's communication to the Panel, 11 December 2008. 
1004 Ibid. 
1005 Rules of Conduct for the Understanding on Rules and Procedures Governing the Settlement of 
Disputes (WT/DSB/RC/1), 11 December 1996,  Section II (Governing Principle). 
1006 Working Procedures, 26 March 2008, attached as Annex A-3 to this report, para. 17(c). 
1007 Rules of Conduct for the Understanding on Rules and Procedures Governing the Settlement of 
Disputes (WT/DSB/RC/1), 11 December 1996, Section VI.2 (Self-Disclosure Requirements by Covered 
Persons).  WT/DS367/R 
 Page 203 
 
 
 (c) other active interests (e.g. active par ticipation in public interest groups or 
other organisations which may have a declar ed agenda relevant to the dispute in 
question); 
(d) considered statements of personal opini on on issues relevant to the dispute in 
question (e.g. publications, public statements); 
(e) employment or family interests (e.g. the possibility of any indirect advantage 
or any likelihood of pressure which could arise from their employer, business associates or immediate family members)."
1008 
7.25 In line with the Rules of Conduct1009, the Panel shared the Illust rative List with Dr Cross on 
16 December 2008.1010  As New Zealand points out, in his preliminary conflict of interest statement, 
Dr Cross stated that: 
"You will see from my publications list that  I have collaborated with scientists at 
HortResearch NZ in the conduct of research into the sex pheromone of apple leaf midge.  We have not had any jointly funded research projects.  I was a guest speaker 
at a NZ top fruit conference a couple of y ears ago.  But then again I was a guest 
speaker at the IFTA [International Fruit Tree Association] 50th anniversary 
conference in Hobart Australia [in 2007]. ..."
1011 
7.26 Subsequently, Dr Cross submitted the disclosure fo rm provided for in Annex 3 of the Rules of 
Conduct, which states as follows:  "... I understand my  continuing duty ... to disclose herewith and in 
future any information likely to affect my indepe ndence or impartiality, or which could give rise to 
justifiable doubts as to the integrity and impartia lity of the dispute settlement mechanism;  ..."1012  No 
further information in this regard was disclosed by Dr Cross. 
7.27 According to Australia, Dr Cross's alleged connection to the New Zealand Government 
results from his "research projects and publica tions with researcher s from HortResearch 
New Zealand."  As a matter of fact, HortRese arch is wholly owned by the New Zealand 
Government.1013  However, participation in joint research w ith other scientists who may be affiliated 
with a government-funded institution does not itself im ply a connection with that Government.  There 
is no indication that Dr Cross has worked for th e Government of New Zealand, nor that he has 
received any monetary compensation from that Government.  The extent of his collaboration with 
                                                      
1008 Rules of Conduct for the Understanding on Rules and Procedures Governing the Settlement of 
Disputes (WT/DSB/RC/1), 11 December 1996, Annex 2. 
1009 Rules of Conduct for the Understanding on Rules and Procedures Governing the Settlement of 
Disputes (WT/DSB/RC/1), 11 D ecember 1996, Section VI.1(a). 
1010 Electronic communication from the Panel to Dr Jerry Cross, 16 December 2008. 
1011 Electronic communication from Dr Jerry Cross, 28 November 2008.  See Panel's communication to 
the Parties, 5 December 2008, whereby th is information was sent to the Par ties, together with the curriculum 
vitae of Dr Jerry Cross. 
1012 Electronic communication from Dr Jerry Cross to the Panel, 16 December 2008. 
1013 "HortResearch was formed on 1 July 1992 as one of nine Crown Research Institutes established 
from several Government departments.  [HortResearch is] wholly Government-owned but [earns] revenue 
through commercial sources (currently about 40 percent) and from a Government funding process where 
[HortResearch obtains] funding through a competitive investment process in association with other Crown Research Institutes, universities and agencies."  Sour ce:  http://www.hortresearch.co.nz/, consulted on 26 
November 2009. WT/DS367/R 
Page 204  
 
 New Zealand scientists at HortResearch and the fact that he did not have "a ny jointly funded research 
projects" with these scientists was disclosed by Dr  Cross, when initially approached by the Panel.
1014 
7.28 Australia does not submit any additional argumen ts, nor any specific evidence for the alleged 
connection of Dr Cross with the New Zealand Governme nt.  In the light of the Illustrative List of the 
Rules of Conduct  cited above, there is no indication that Dr Cross has any financial, business or 
property interests "relevant to the dispute in question", nor that he has any professional, other active, 
employment or family interests in the dispute, unde r paragraphs (a), (b), (c) and (e) of that List. 
7.29 Australia's objection to the selection of Dr Cross, is based on the argument that Dr Cross's 
"joint research projects and publications with rese archers from HortResearch New Zealand" constitute 
a connection to the New Zealand Government and New Zealand researchers.  In this respect, Australia 
refers only to "a joint publication with Suckling et al. , published in 2007" which corresponds to the 
article submitted by New Zealand as Exhibit NZ-15.1015  In Australia's view, this joint publication 
"indicates a very recent connection [of Dr Cross] w ith relevant New Zealand researchers, whose work 
is primarily targeted at facilitating access for New Zealand apples to export markets".1016 
7.30 The Suckling et al.  (2007) paper was published in June 20071017, prior to the establishment of 
the Panel.  The paper acknowledges that its resear ch, including Dr Cross's costs of travelling to 
New Zealand, was supported by Pipfruit NZ Inc.  and a contract from New Zealand's foundation for 
Research Science and Technology to HortResearch.1018  The paper addresses the potential of mass 
trapping as a means to control ALCM. 
7.31 As stated by the Appellate Body, when selecting experts, panels must consider "whether there 
is an objective basis to conclude that an expert's independence or impartiality is likely to be affected 
or there are justifiable doubts about that  expert's independence or impartiality."1019  The standard for 
selecting experts aims at ensuring the fairness and impartiality of the ex perts' consultation in 
conformity with due process.  The lack of independe nce and/or impartiality will prejudice the parties' 
right to a fair proceeding. 
7.32 A panel is responsible for ensuring that the sel ected experts have the necessary qualifications 
and expertise, and comply with the requirements  for independence, impartiality and avoidance of 
conflicts of interest.  Conversely, it is not enou gh for a party to simply assert an objection regarding 
the selection of a particular expert.  Any party raisin g such an objection is expected to explain in what 
manner the expert's independence or impar tiality have been or may be compromised. 
7.33 It is to be expected that in any specialized area of science, the fe w knowledgeable experts will 
frequently engage with each other and may particip ate in joint research projects, in meetings and 
conferences, and joint publications.  Participation in "joint research projects and publications" are an 
indication of the qualifications and specialized sc ientific expertise that, in accordance with its 
                                                      
1014 Electronic communication from Dr Jerry Cross, 28 November 2008.  See Panel's communication to 
the Parties, 5 December 2008, whereb y this information was sent to the Parties, together with the curriculum 
vitae  of Dr Jerry Cross. 
1015 Suckling DM, JTS Walker, PW Shaw, L-A Manning, P Lo, R Wallis, V Bell, WRM Sandanayaka, 
DR Hall, JV Cross & AM El-Sayed (2007), "Trapping Dasineura mali (Diptera: Cecidomyiidae) in Apples", Journal of Economic Entomology  100(3), in Exhibit NZ-15. 
1016 Australia's communication to  the Panel, 9 December 2008. 
1017 See, http://www.entsoc.org/Pubs/Periodicals/JEE/inde x.htm.  This is the website of the journal in 
which the article was published. 
1018 Suckling DM, JTS Walker, PW Shaw, L-A Manning, P Lo, R Wallis, V Bell, WRM Sandanayaka, 
DR Hall, JV Cross & AM El-Sayed (2007), "Trapping Dasineura mali (Diptera: Cecidomyiidae) in Apples", Journal of Economic Entomology  100(3), in Exhibit NZ-15, p. 750. 
1019 Appellate Body Report on Canada – Continued Suspension , para. 454.  WT/DS367/R 
 Page 205 
 
 
 Working Procedures, the Panel was to use as a basis to select scientific experts.  Per se , this fact is not 
enough to call into question a researcher's inde pendence and impartiality, nor is it necessarily 
evidence of a connection with the government of a part y.  Nor is the fact that some of those "joint 
research projects and publications" may be funded or  supported by institutions associated with the 
government of a Member.  This is particularly true, when, as this Panel's considerable difficulty in 
identifying experts clearly demonstrates, there is a very small number of experts in the field in 
question.  In such a situation it is all the more lik ely that "all of the world's experts" will work and 
collaborate in some way at one time or another.  Moreover, the fact that a scientific project or 
publication is funded by a private organization or a governmental institution is not in itself a reason to call into question the results of the research. 
7.34 As noted above, the Panel is responsible of en forcing in its proceedings the standards of 
independence and impartiality contained in the Rul es of Conduct for the DSU.  Notwithstanding this 
fact, in the present case, as the party making an obj ection to the selection of an expert proposed by the 
Panel, it was Australia's burden to make the case th at Dr Cross's participation in a joint research 
project and publication with researchers from HortResearch New Zealand would call into question 
Dr Cross's independence and impartia lity, or create actual or potential, direct or indirect, conflicts of 
interest.  In the absence of any explanation or evid ence from Australia in this regard, the Panel finds 
no facts to support the conclusion that Dr Cross's participation in the res earch that led to the 
publication of the Suckling et al.  (2007) paper, raises doubts regarding his independence and 
impartiality or his capacity to provide expert advice to this Panel. 
7.35 When originally consulted by the Panel on th e draft questions to the experts, Australia 
objected to two questions being posed to Dr Cross on the flight range of ALCM, arguing that this may 
create a potential conflict of interest, as he w ould be asked to comment on his own work.
1020  
Ultimately, the Panel decided to pose both questions .  After having received the experts' responses 
and having held its meeting with the experts and th e Parties, the Panel asked Australia its views on 
how the Panel should consider Dr Cross's answers.  In response, Australia considered that Dr Cross 
did not give "undue weight or importance to his own work on the issue of flight distance, to the 
detriment of other material availabl e or alternative views on the matter."1021  Indeed, in its subsequent 
submissions Australia used responses given by Dr Cross to the questions to which Australia had 
previously objected, to support its arguments.1022  In other words, there was only one instance where 
Australia had articulated a specific objection th at called into question whether Dr Cross was 
sufficiently impartial and, ultimately, Australia did not maintain its objection and noted that the expert 
provided his response in an unbiased manner. 
7.36 In US/Canada – Continued Suspension , the Appellate Body confirmed the "significant 
investigative authority" of panels under Article 13 of the DSU and Article 11.2 of the SPS Agreement 
and the broad discretion of panels  in exercising this authority.1023  As noted in the previous section on 
Australia's objections to the selection of a so le expert on ALCM, the Panel faced significant 
difficulties in selecting experts on ALCM, despite th e assistance received from the IPPC, the CICD 
and the Parties.  Having considered the qualifications  and conflict of interest statements of Dr Jerry 
Cross, the Panel found no reasons that would have prevented it from seeking the scientific advice of 
Dr Cross.  In particular, nothing in the objection ra ised by Australia gave any indication of real or 
perceived conflicts of interest or any other situation that would have  affected Dr Cross's independence 
and impartiality.  As in the case of the other expert s, the responses provided by Dr Cross to questions 
posed by the Panel and the Parties have been extrem ely rigorous and helpful, for which the Panel is 
sincerely grateful. 
                                                      
1020 Australia's communication to the Pane l, 19 December 2008, pp. 70 and 76. 
1021 Australia's reply to Panel question 28 after the second substantive meeting. 
1022 See, for example, Australia's second writte n submission, paras. 616, 670-671 and 673. 
1023 Appellate Body Report on Canada – Continued Suspension , para. 439. WT/DS367/R 
Page 206  
 
 3. Consultation of experts 
(a) Concerns expressed by Australia 
7.37 In accordance with its Working Procedures, the Panel prepared its questions to experts in 
consultation with the Parties.
1024  As noted in its timetable, on 15 December 2008, the Panel informed 
the Parties of its proposed questions to the e xperts.  The Parties submitted their comments on the 
proposed questions on 19 December 2008.1025  In its communication, Australia made extensive 
comments on the proposed questions.  In addition to numerous specific comments on the Panel's proposed questions to experts, Australia identified a number of more general concerns, namely that in 
its view some of the proposed questions: 
 – "Appear to be leading", i.e., they may suggest an answer; 
 
 – Address issues that were not raised by New Zealand, including issues raised only in 
the United States' third party submission; 
  – Use inconsistent terminology or do not stric tly follow the text of the obligations in the 
SPS Agreement; 
  – Include "selective, incomplete or poten tially misleading" references to Parties' 
submissions;  or, on the contrary, 
  – Include references to Parties' submissions that go beyond what is necessary for the 
experts to perform their role.
1026 
 Additionally, Australia noted that the Panel shoul d ensure that it does not delegate to experts 
questions on which it is the Panel's responsibility to  decide and that the Panel should allocate the 
questions which experts should respond to, based  on the experts' relevant areas of expertise.
1027 
 
7.38 Having revised the proposed questions in the light of the Parties' comments, on 
16 January 2009 the Panel sent the final version of the qu estions to the experts, copied to the Parties.  
The Panel received written replies from the experts on 9 March and relayed these replies to the Parties 
on 10 March.  On 25 March 2009, the Parties su bmitted their comments on the experts' responses.  
In its comments on the experts' responses, Australia raised the following two concerns:  that a number 
of the Panel's questions go to matters that requi re specialist knowledge wh ich none of the experts 
selected by the Panel would have;  and, that in some of their responses experts provide additional 
information that does not fall within the scope of th e Panel's questions and should only be considered 
as background information.  Australia also noted two c oncerns that in its view relate to the observance 
of due process in the expert phase of the dispute,  namely that Australia had not been given an 
opportunity to comment on several questions that were  put to the experts and either had not appeared 
in the draft questions originally provided to the Par ties or were substantially modified from the draft;  
and that, in answering the questions, some of the experts moved outside the field of expertise for which each was selected. 
7.39 In its second written submission on 21 April 2009 , Australia argues that the Panel addressed 
"some, but not all," of the "due process concerns" re garding the proposed questions to the experts that 
                                                     
 
1024 Working Procedures, 26 March 2008, attached as Annex A-3 to this report, para. 17(f). 
1025 New Zealand's and Australia's communica tions to the Panel, 19 December 2008. 
1026 Australia's communication to the Panel, 19 December 2008. 
1027 Ibid.  WT/DS367/R 
 Page 207 
 
 
 were expressed in Australia's letter of 19 December 2008.1028  Although Australia does not explicitly 
say so, presumably these specific "due process concerns" were addressed by the Panel when it drafted the revised version of its questions to the experts.   The concerns that would have been addressed in 
the revised draft questions include Australia's alle gation that some questions were "leading", used 
inconsistent terminology, or included "selective,  incomplete and potentially misleading" paragraph 
references, and Australia's request to limit the refere nces to Parties' submissions in the questions.  The 
Panel reaches this conclusion because these specific con cerns were not raised again by Australia when 
the Panel asked Australia to clarify the nature of  its due process concerns at the second substantive 
meeting with the Parties and in its written questions  to Australia after the second meeting.  In the 
second written submission, Australia also refers to its "additional due process concern" that the Panel 
allegedly posed questions to the experts that either  did not appear in the draft questions originally 
provided to the Parties or were substantially modified from the draft.
1029 
7.40 Accordingly, the Panel will address the fo llowing concerns expressed by Australia: 
 – That the Panel posed questions to the expe rts that either did not appear in the draft 
questions originally provided to the Parti es or were substantially modified from the 
draft; 
  – That the Panel should have limited its qu estions to issues rai sed by New Zealand and 
should not consider issues raised in Th ird Parties' submis sions or additional 
information provided by the experts;  and, 
 
 – That experts should not express opinions outside of the field of expertise for which 
each was selected. 
 (b) Whether the Panel posed new questions to expe rts or modified questions from the draft 
provided to Parties and whether such new questions affect due process 
7.41 As noted above, Australia submits that due process has been affect ed as the Panel posed 
several questions to the experts that did not appear in the draft list of questions provided to the Parties 
on 15 December 2008 for their comments.  Australia a dds that "[o]ther questions were modified or 
amended which substantially  altered the nature of the original questions."
1030  Australia adds that it 
"was not given an opportunity to comment in any of these instances".1031 
7.42 After the second substantive meeting with the Par ties, the Panel asked Australia to clarify the 
nature of its due process concerns expressed in its  comments on the experts' replies to questions.  
With respect to the specific issue of "n ew" questions, Australia answered that: 
"In paragraph 16 [of its comments on the e xperts' replies], Australia noted the 
following concerns: 
[S]everal new questions were put to  the experts which did not appear 
in the draft questions provided to  the parties for comment.  Other 
questions were modified or amende d which substantially altered the 
nature of the original questions.  Australia was not given an opportunity to comment in any of these instances. 
                                                     
 
1028 Australia's second written submission, para. 56. 
1029 Australia's second written submission, para. 57. 
1030 Australia's comments on the experts' replies to questions, Australia's communication to the Panel, 
25 March 2009, para. 16. 
1031 Ibid. WT/DS367/R 
Page 208  
 
 The following questions to the experts did not appear in the proposed list of questions 
sent for comment to the parties:  Questions 17, 21, 23, 36, 37, 89 and 121.  Australia has already addressed Questions 21, 89 and 121 ... as questions that addressed matters 
outside the experts' fields of expertise.  Australia maintains its position that the Panel, 
as a matter of due process, should have gi ven it an opportunity to comment on new 
questions put to the experts which di d not appear in the draft questions."
1032 
7.43 Australia had originally referred to both "n ew questions" and "modified or amended" 
questions.  When asked by the Panel to clarify its  due process concern it referred to questions that 
Australia identified as "questions [that] did not appear in the proposed lis t of questions sent for 
comment to the parties", i.e., "new questions" 17, 21, 23, 36, 37, 89 and 121.1033  In response to 
another question from the Panel, Australia also e xpressed concerns regarding modifications made by 
the Panel to questions 19, 20 and 27, as a result of comments from New Zealand.1034 
7.44 Australia added that questions 17, 23 and 36 had been proposed by New Zealand, but 
Australia's position had not been prejudiced by the content of these questions and, accordingly, it had 
no difficulty with answers by experts to these three questions being drawn upon by the Panel.1035 
7.45 As set out above, in response to the Panel's questions after the second substantive meeting 
with the Parties, Australia clarified that its c oncern with questions 21, 89 and 121 is that they 
allegedly address issues outside of the experts' respec tive fields of expertise.  As a starting point, the 
Panel notes that none of these questions was truly a "new" question.  Question 121 was in the draft list 
of questions provided to the Parties on 15 December 2008.  It relates to the issue of whether it was reasonable to assume that Australia would permit packing houses to leave waste exposed to the 
elements.
1036  The draft question referred in this regard  to paragraph 4.420 of New Zealand's first 
written submission, paragraphs 898-900  of Australia's first written submission and to Australia's reply 
to Panel question 100 after the first substantive meeti ng.  In response to the Panel's questions after the 
second substantive meeting with the Parties, Au stralia recognizes that draft question 121 was 
reformulated:  "[t]he revised question was also ask ed as Question 21 under fire blight and Question 89 
under European canker."1037  As a matter of fact, questions 21, 89 and 121 are mere reformulations of 
draft question 121, referring to the issue of whet her it was reasonable for the IRA to assume that 
Australia would permit packing houses to leave waste exposed to the elements, in respect to the risk 
assessment for fire blight, European canker and ALCM, respectively.  Questions 21, 89 and 121 
modified or amended draft question 121 only by posing the same question separately for each of the 
three pests at issue and by incorporating a reference to relevant sections in Australia's IRA and to a 
few additional paragraphs in the Parties' submissions , mostly contiguous to those already included in 
the original references in draft question 121.  Therefore, questions 21, 89 and 121 were not "new" 
questions. 
7.46 As regards question 37, Australia raises two objectio ns.  First, that the question did not appear 
in the draft sent to the Parties and therefore Australia was depriv ed of an opportunity to comment.1038  
Second, that, since Australia did not have th e opportunity to comment, question 37 ultimately 
followed language proposed by New Zealand that li mited the scope of the que stion to "experimental 
evidence obtained in orchard conditions"1039, and Australia did not have the opportunity to comment 
                                                      
1032 Australia's reply to Panel question 20 after the second substantive meeting, paras. 84-85. 
1033 Australia's reply to Panel question 20 after the second substantive meeting, para. 85. 
1034 Australia's reply to Panel question 22 after the second substantive meeting, para. 128. 
1035 Australia's reply to Panel question 20 after the second substantive meeting, para. 86. 
1036 Proposed questions for experts, Panel's communication to the Parties, 15 December 2008, 
question 121. 
1037 Australia's reply to Panel question 20 after the second substantive meeting, para. 76. 
1038 Australia's reply to Panel question 20 after the second substantive meeting, para. 85. 
1039 Australia's reply to Panel question 22 after the second substantive meeting, para. 129.  WT/DS367/R 
 Page 209 
 
 
 on this issue.1040  Australia states that, by framing the question in this manner, the Panel allowed 
New Zealand to limit the scope of the question to  conform with New Zealand's narrow view of 
applicable science linked to experimental evidence obtained in orchard conditions and prevented the 
experts from commenting on the full range of relevant scientific evidence.  Australia was not given an 
opportunity to comment on this approach until th e experts had answered these questions.  The 
answers were on the record by then.1041  Finally, Australia argued that, as a result of comments from 
New Zealand, the Panel modified questions 19, 20  and 27, again limiting the questions to natural 
conditions, without permitting New Z ealand an opportunity to comment.1042 
7.47 In response to Australia's arguments, New Zeal and asserts that, when asked by the Panel to 
clarify the nature of its due process concerns afte r the second substantive meeting, Australia did not 
contend that due process had been infringe d with respect to the "new questions".1043  New Zealand 
adds that the Parties had the opportunity to comme nt on the Panel's draft questions and asserts that 
Australia provided extensive comments that  were taken into account by the Panel.1044  In 
New Zealand's view, the Panel was entitled to draft additional questions wit hout further consultation 
with the Parties and Australia subsequently had th e opportunity to comment on any substantive matter 
arising from the experts' res ponses to these "new questions".1045 
7.48 Regarding the alleged limited sc ope of some of the Panel's qu estions, New Zealand considers 
that the experts were not prevented by the Panel' s questions from "comment[ing] on the full range of 
relevant scientific evidence".1046  New Zealand asserts that the experts' responses demonstrate the 
consideration of laboratory evidence.1047  It also notes that Australia took advantage of "the 
opportunity to comment on the issue of the scientif ic evidence considered by the experts" in 
Australia's comments on the experts' respon ses and in the meeting with the experts.1048 
7.49 In question 37, the Panel asked the expe rts for their opinion on the following: 
"Does the IRA contain an objective and cr edible analysis, based on respected and 
qualified scientific sources, for a proposition that the introduction of fire blight via 
mature apple fruit has ever occurred or coul d occur, either experimentally or under 
natural conditions or that populations of E. amylovora  on mature apple fruit could be 
the source of fire blight infections under natural conditions?  Are you aware of  any 
scientific evidence outside of th e IRA for such a proposition?" 
7.50 The question posed by the Panel followed two qu estions that were suggested by New Zealand 
in its comments on the Panel's proposed questions:  "Are  you aware of  any scientific evidence either 
in the IRA or otherwise that the introduction of fire  blight via mature fruit has ever occurred or could 
occur, either experimentally or under natural conditions?" and "Are you aware of any scientific 
                                                      
1040 Australia's reply to Panel question 22 after the second substantive meeting, para. 129 . 
1041 Ibid.  See also, Australia's comments on the experts' replies to questions, communication from 
Australia to the Panel, 25 March 2009, para. 85. 
1042 Australia's reply to Panel question 22 after the second substantive meeting, para. 128. 
1043 New Zealand's comments on Australia's reply to Panel question 20 after the second substantive 
meeting, para. 44. 
1044 New Zealand's comment on Australia's reply to Panel question 26 after the second substantive 
meeting, para. 33. 
1045 Ibid. 
1046 New Zealand's comments on Australia's reply to Panel question 22 after the second substantive 
meeting, paras. 61 and 64. 
1047 New Zealand's comments on Australia's reply to Panel question 22 after the second substantive 
meeting, para. 64. 
1048 New Zealand's comments on Australia's reply to Panel question 22 after the second substantive 
meeting, para. 62. WT/DS367/R 
Page 210  
 
 evidence that populations of E. amylovora  on mature apple fruit could be the source of fire blight 
infections under natural conditions?"
1049 
7.51 In turn, questions 19, 20 and 27 asked the experts for their opinion on the following: 
Question 19:  "Please comment on whether there is sound scientific evidence that 
epiphytic infestations by E. amylovora  exist on mature apple fruit in quantities that 
are under natural conditions capable of re production;  being tr ansferred to a host 
plant;  and ultimately initiating an infection in that host plant?" 
Question 20:  "Please comment on whether th e requirements identified in Australia's 
IRA, regarding disinfection treatment of  apples in the packing house and the 
disinfecting of packing house equipment before each Australian packing run, are 
scientifically justified and reasonable?  Are you aware of any reliable scientific 
evidence of E. amylovora  from harvested apples contaminating packing house 
equipment?  If so, would such bacteria survive the packing house process?  Are you 
aware of any reliable scientific evidence of mechanical transfer in a natural 
environment of E. amylovora  from workers' hands to susceptible hosts?" 
Question 27:  "Please comment on whether the reasoning in Australia's IRA regarding 
the number of E. amylovora  bacteria isolated from, and reported on, mature apple 
fruit that would be sufficient to spread to a susceptible host and initiate an infection 
under natural (as opposed to laboratory) cond itions.  Is this evaluation objective and 
credible? Is it based on respected and qualified scientific sources?" 
7.52 Under Articles 13.1 of the DSU and 11.2 of the SPS Agreement, a panel has a broad right to 
seek information and technical advice from scientific experts.  Indeed, under Article 11.2 of the 
SPS Agreement, a panel engaged in dispute settlement proceedings involving scientific or technical 
issues under that agreement should "seek advice from e xperts chosen by the panel in consultation with 
the parties to the dispute".  Expert consultation is part of the broad right of a panel "to seek 
information and technical advice from any individu al or body which it deems appropriate" and to 
"seek information from any relevant source" and "c onsult experts to obtain their opinion on certain 
aspects of the matter" under Article 13 of the DSU.  Ultimately, the purpose of expert consultation is 
to allow a panel to exercise its duty to "make an objective assessment of the matter before it", 
pursuant to Article 11 of the DSU. 
7.53 As stated by the Appellate Body in US – Shrimp : 
"[T]he DSU accords to a panel established by the DSB, and engaged in a dispute 
settlement proceeding, ample and extensive au thority to undertake and to control the 
process by which it informs itself both of the relevant facts of the dispute and of the legal norms and principles applicable to such  facts.  That authority, and the breadth 
thereof, is indispensably n ecessary to enable a panel to discharge its duty imposed by 
Article 11 of the DSU to '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  … .'  (emphasis added)"
1050 
7.54 As noted above, in the US/Canada – Continued Suspension  dispute, the Appellate Body 
confirmed the "significant investigative authorit y" of panels under Article 13 of the DSU and 
                                                      
1049 New Zealand's comments on proposed questions for experts, New Zealand's communication to the 
Panel, 19 December 2008, pp. 8-9. 
1050 Appellate Body Report on US – Shrimp , para. 106.  WT/DS367/R 
 Page 211 
 
 
 Article 11.2 of the SPS Agreement and the broad discr etion of panels in exercising this authority, 
including through expert consultation.1051 
7.55 Paragraph 17(f) of the Working Procedures fo r the Panel, adopted by the Panel on 
26 March 2008, provides that "[t]he Panel will prepar e written questions for the experts.  Parties will 
have the opportunity to comment on the proposed qu estions, or suggest additional ones, before the 
Panel decides on the final questions to be sent to the experts."1052 
7.56 The timetable adopted by the Panel on 8 April 2008 contemplated that Parties would receive 
the Panel's proposed list of experts and questions on  22 October 2008, would have five working days 
until 29 October to submit comments to the Panel and that the Panel would in turn send the questions 
to experts five working days later. 
7.57 In accordance with Articles 12.1 and 12.3 of the DSU, both the Working Procedures and the 
timetable were drawn up by the Panel after havi ng consulted the Parties.  While the Working 
Procedures granted Parties the right to comment on the draft questions proposed by the Panel and 
suggest additional questions, the Panel was ultimately  responsible for deciding on the final form of 
the questions that it would pose to the experts. 
7.58 No provision was made in the Working Procedures,  or in the timetable, allowing either Party 
the opportunity to comment on questions proposed by the other Party.  Nor do the Working Procedures require the Panel to send its revised ques tions back to the Parties, allowing them a second 
opportunity for commenting.  The practice of granting parties an opportunity to comment on proposed questions and to suggest additional ones has been fo llowed by previous panels that have consulted 
scientific experts.
1053 
7.59 In accordance with the Working Procedures a dopted by the Panel, both New Zealand and 
Australia made comments on the Panel's proposed qu estions to the experts and suggested additional 
questions.  The comments made by the two Parties were numerous, extensive and not always easy to 
reconcile.  Indeed, the comments received from the Parties were so extensive that on 23 December 
2008 the Panel informed the Parties that it would not be in a position to send the questions to experts 
before the end of the year, as intended.  Questions were ultimately sent to experts on 16 January 2009. 
7.60 The Parties were aware that, under the Panel' s Working Procedures and timetable, they had 
one opportunity to suggest new questions for the expe rts to the Panel.  Nothing prevented any of the 
Parties, however, from requesting that the Panel am end its procedures and timetable to allow for an 
additional round of consultations.  Before the Panel finalized and sen t its questions to the experts 
neither Party requested the opportunity to comment on  the revised version of the questions, or on the 
questions suggested by the other Party.  In particul ar, no such request was formulated either when the 
Panel's Working Procedures and timetable were draw n up, nor at the moment when Parties submitted 
their respective comments on the proposed questions on 19 December 2008, or after they received a 
copy of each other's comments on the proposed questi ons in the period before the questions were sent 
to the experts.  It was only on 25 March 2009, two weeks after the Parties had received the experts' 
responses from the Panel, that Australia raised for the first time its concern regarding the Panel's 
posing of "new questions" or "modified questions". 
                                                      
1051 Appellate Body Report on Canada – Continued Suspension , para. 439. 
1052 Working Procedures, 26 March 2008, attached as Annex A-3 to this report, para. 17(f). 
1053 See, for example, Panel Report on EC – Approval and Marketing of Biotech Products, para. 7.26;  
Panel Report on Japan – Apples , para. 6.2;  Panel Report on Australia – Salmon , para. 6.4;  Panel Report on  
Japan – Agricultural Products II , para. 6.2. WT/DS367/R 
Page 212  
 
 7.61 The Panel found no reason to propose ex officio  an extra step of consultations, particularly 
since the proceedings had already suffered delays for a number of other reasons.  Furthermore, had 
the Panel allowed for a second round of comments, presumably a Party could still complain that any 
questions modified or amended in the light of su ch comments would also need to be consulted on, 
with the risk of engaging in a circular process of  consultations.  Because there was no provision that a 
Party would have an opportunity to comment on questi ons to experts suggested by the other Party or 
on modifications made by the Panel as a result of comments from the other Party, as a matter of fact 
Australia could not have been deprived of such an op portunity by the Panel.  Accordingly, there is no 
evidence that due process has been  affected in this respect. 
7.62 Nor is due process affected by the content of  questions 19, 20, 27 a nd 37, and namely the 
focus on "experimental evidence obtained in or chard conditions".  Under the Panel's Working 
Procedures, the Panel was ultimately responsible for d eciding on the final form of the questions that it 
would pose to the experts.  Moreover, it is factually  incorrect for Australia to assert that question 37 
limited the scope of the enquiry to evidence obtained under orchard conditions.
1054  Indeed, the first 
part of the question refers to the possible introduc tion of fire blight via mature apple fruit "either 
experimentally or under natural conditions". 
7.63 Even assuming that question 37, as well as questions 19, 20 and 27, focused on evidence 
obtained under orchard conditions, as opposed to evid ence obtained in the laboratory, and that this 
limited the scope of the question in a manner advant ageous to New Zealand, there is no evidence that 
this would have prejudiced Australia's position. 
7.64 In the Panel's view, the language of questions 19, 20, 27 and 37 w as appropriate in the light of 
the relevant reasoning of the IRA.  As was genera lly the case, in this question, the Panel asked the 
experts to initially focus on the reasoning contained in Australia's IRA.  The Panel also asked the 
experts to share their views on whether the IRA' s analysis was based "on respected and qualified 
scientific sources". 
7.65 Australia enjoyed ample opportunities to comment on the responses received from the 
experts, and even to pose questions to the experts wi th a different focus, if it wished to.  In accordance 
with the Panel's Working Procedures and timetable , Parties first had the opportunity to submit 
comments on 25 March 2009 on the experts' responses, and then on 9 April on each other's comments 
on the responses.  Parties then had the opportunity to comment again on th e issues raised by the 
experts' responses in their rebuttal submissions due  on 21 April.  Parties were later able to pose 
questions orally to the experts on occasion of the me eting with the Panel on 30 June.  Indeed, after 
Australia raised the argument that it was important to  focus, not only on ev idence obtained in natural 
conditions, but also on evidence obtained in the labo ratory, the Panel posed this specific question to 
the experts during the meeting with the Parties on 30 June.1055 
7.66 There is no indication that in the original written questions posed on 16 January 2009, the 
experts were prevented "from commenting on the full range of relevant scientific evidence", including 
evidence obtained under laboratory conditions.  The Guidelines for Experts provided in the Panel's 
questions of 16 January 2009, direct the experts to Australia's IRA and the scientific evidence 
provided by the Parties, as well as any additional relevant scientific evidence;  no limitation is made 
to a specific type of evidence, obtained either unde r natural or experimental conditions.  Indeed, there 
                                                      
1054 Australia's reply to Panel question 22 after th e second substantive meeting, paras. 112-133. 
1055 Transcript of the Panel's meeting with experts, paras. 170-172.  WT/DS367/R 
 Page 213 
 
 
 are plenty of references in the experts' responses  on the specific issue of fire blight to evidence 
obtained under laboratory conditions.1056 
7.67 In sum, the Panel finds that there is no evid ence to support Australia's assertion that posing 
questions 19, 20, 27 and 37 to the experts has prej udiced Australia's position in these proceedings.  
When, as in the present case, each party is allo wed to pose its own questions, to comment on 
responses received from the experts and to pose subse quent questions to the experts in a meeting with 
the panel, parties' respective position in the pr oceedings and due process are initially not prejudiced 
by the specific formulation of a questio n posed by a panel to the experts. 
(c) Whether the Panel should be prevented from c onsidering issues raised in Third Parties' 
submissions or additional inform ation provided by the experts 
7.68 In its comments on the proposed questions to expe rts, Australia asserted that "[a] number of 
proposed questions address issues which New Zealand has not raised".1057  According to Australia, 
some of the proposed questions "address issues ra ised solely in the Unit ed States' third party 
submission".1058  In its response to the Panel's questi ons after the second substantive meeting, 
Australia reiterated this concern:  "as third parti es are not parties to the dispute, their submissions 
cannot constitute evidence and argument that can be used  by either party to make the case for it.  Nor 
by the same reasoning can third party submissions provide a basis for questions to be put to the experts."
1059 
7.69 In response to the Panel's questions after the second substantive meeting with the Parties, 
Australia identified the following written questi ons posed by the Panel to the experts on 
16 January 2009 as including references to the United States Third Party submission:  20, 25, 29, 33, 
41, 88, 125, 129, 132 and 138.1060  Looking at the individual questions and answers, however, 
Australia indicated that it was only concerned by questions 33, 88, 125, 129 and 132.  With respect to these five questions, Australia requested the Panel to disregard in full the responses provided by the 
experts, "in order to ensure that New Zealand' s case should not inappropriately benefit from the 
responses on issues which it has not raised or substantiated itself".
1061 
7.70 Australia also argues that, because it is up to the complaining party to make its prima facie 
case of inconsistency, "[e]xpert testimony may not be  used as 'evidence' for a claim which either has 
not been raised by a party or where that claim ha s been inadequately substantiated with evidence by 
the relevant party."1062 
7.71 In response to Australia's concern, New Zeal and rejects the proposition that a panel cannot 
draw on third party submissions in posing questions to the scientific experts.  In New Zealand's view: 
"[T]hird parties have a right to provide ar gument and evidence on all of the issues that 
fall within the Panel's terms of reference.   The views of the third parties can be 
considered, discussed, approved of, supported, or disagreed with by the Parties and 
the Panel.  This includes testing what the th ird parties have said by reference to the 
                                                      
1056 See, for example, Dr Paulin's reply to Panel questions 6, 27 28, 34, 38, 39, 40 and 42, in List of 
Replies from the scientific experts to questions posed by the Panel, paras. 49, 191, 205, 238, 255-257, 259-260, 262-263 and 272-273. 
1057 Australia's communication to the Pa nel, 19 December 2008, p. 4, fo urth bullet point from the list. 
1058 Australia's communication to the Panel, 19 December 2008, p. 4, fifth bullet point from the list. 
1059 Australia's reply to Panel question 21 after the second substantive meeting, para. 98. 
1060 Australia's reply to Panel question 21 after the second substantive meeting, para. 99. 
1061 Australia's reply to Panel question 21 after the second substantive meeting, paras. 106-107 and 
109-110. 
1062 Australia's reply to Panel question 5 after the second substantive meeting, para. 30. WT/DS367/R 
Page 214  
 
 advice of experts.  This is fully consiste nt with the Panel's duty to undertake an 
objective assessment of the matter, and with ensuring that the right of third parties to have a meaningful role in dispute settlement is preserved."
1063 
7.72 New Zealand adds that, in any event, it has pr operly raised and substantiated all the claims 
objected to by Australia.1064 
7.73 Australia's concerns regarding the Panel's use of  information provided by the experts or in 
Third Party submissions has been framed in connec tion with the process of expert consultation.  
Australia argues that New Zealand did not substantiate  some of its claims and subsequently attempted 
to use information provided by the experts or by th e Third Parties to cure that deficiency.  Australia 
also argues that the Panel cannot rely on the expe rts' responses to questions involving Third Party 
submissions, since it was New Zealand's task to substantiate its claims. 
7.74 As noted above when considering Australia's c oncerns regarding the a lleged "new questions", 
the process of expert consultation is ultimately re lated to a panel seeking in formation and technical 
advice so as to fulfil its duty to "make an objectiv e assessment of the matter before it", pursuant to 
Article 11 of the DSU.  In turn, the "matter" before  a panel consists of the claims made in connection 
with specific measures identified by the complainant,  as both claims and measures are reflected in the 
respective panel's terms of reference.1065 
7.75 It is the complaining party's burden to express the nature of its claims in the panel request, by 
providing a brief summary of the legal basis of its complaint that is sufficient to present the problem 
clearly.  The complainant must identify the provisions  in the covered agreements that, in its view, are 
being breached by the offending measures.1066  Once a claim is properly included within a panel's 
terms of reference, it is again the burden of the complainant to articulate its claim by providing 
arguments and evidence necessary to make a prima facie case of inconsistency.1067 
7.76 In any event, once a claim is properly put be fore a panel and the complaining party has 
submitted its arguments and articulated its complaint,  the panel has broad powers of investigation in 
order to make an objective assessment of the matter.   At that point, a panel is not limited by the 
arguments made by the parties to a dispute;  it may develop its own arguments, and it can certainly 
consider the arguments made by third parties.  Australia's proposition that a panel is precluded from 
considering information put forward by a third part y is contrary to the panel's duty to make an 
objective assessment of the matter.  It would also  constitute a breach of the rights granted under the 
DSU to third parties in WTO dispute settlement.  Ar ticle 10.2 of the DSU provides that third parties 
"shall have an opportunity to be heard by the pane l and to make written submissions to the panel".  
The Appellate Body has noted in this respect that , not only have third parties the right to make 
submissions in a dispute, but panels have the legal obligation to consider them.  In the words of the 
Appellate Body: 
"[U]nder the DSU, only Members who are parties to a dispute, or who have notified 
their interest in becoming third parties in such a dispute to the DSB, have a legal right  
to make submissions to, and have a legal right  to have those submissions considered 
by, a panel.  Correlatively, a panel is obliged  in law to accept and give due 
                                                      
1063 New Zealand's comment on Australia's response to Panel question 21 after the second substantive 
meeting, para. 55. 
1064 New Zealand's comment on Australia's response to Panel question 21 after the second substantive 
meeting, para. 56. 
1065 See, for example, Appellate Body Report on Guatemala – Cement I , para. 72. 
1066 See, for example, Appellate Body Report on Korea – Dairy , para. 139. 
1067 Appellate Body Report on Chile – Price Band System , para. 173.  WT/DS367/R 
 Page 215 
 
 
 consideration only to submissions made by th e parties and the third parties in a panel 
proceeding."1068 
7.77 In other words, the rights of a third party to make submissions to a panel and the duty of a 
panel to take into account relevant  information provided by a third party in its submission are two 
sides of the same coin.  If panels were preven ted from considering information provided by a third 
party, including arguments and evidence, then th ird party rights under the DSU would be illusory. 
7.78 As noted above, under the Panel's Working Pr ocedures, the Panel was ultimately responsible 
for deciding on the questions that it would pose to the experts.  Nothing prevented the Panel from 
using information, including arguments and evidence , provided in the submission of a Third Party.  
Nothing would subsequently prevent the Panel fro m using such information for the purpose of 
performing its objective assessment of the matter.  Nor would the Panel be prevented from using 
information provided by the experts in response to the Panel's questions, or in response to questions 
posed by the Parties themselves during the meeting with the experts, as long as this information is 
relevant to the matter that is with in the Panel's terms of reference. 
7.79 As regards questions 33, 88, 125, 129 and 132 to  the experts, Australia has not argued that 
any of these questions were outside of the terms of reference of the Panel.  Australia has not alleged 
that the questions did not relate to claims made by New Zealand that the challenged measures were in 
breach of specific provisions of the SPS Agreement.  Question 33, for example, relates to "importation step 7" in the risk assessment for fi re blight.  The consistency of the IRA's reasoning 
with regard to fire blight with the provisions of  the SPS Agreement cited by New Zealand is clearly 
within the Panel's terms of reference. 
7.80 Furthermore, Australia's argument would in practice preclude parties from developing their 
arguments after their respective first written submi ssion.  Australia has explicitly contended this.  
In its first written submission, for example, Aust ralia suggests that, because New Zealand had already 
identified a number of alleged methodological flaws in Australia's IRA, "New Zealand should not be 
permitted to expand its claims beyond these so-calle d 'flaws' at a later time in these proceedings"
1069 
or that because "New Zealand has not made a claim concerning the effects of brushing, waxing, 
sorting and grading and packaging as considered by  the IRA ... [it] should not be permitted to expand 
its claims in relation to these issues at a later stage of proceedings".1070  Australia's argument in this 
regard blurs the distinction developed by the A ppellate Body between claims and arguments.  As 
noted by the Appellate Body: 
"[T]here is a significant difference between the claims  identified in the request for the 
establishment of a panel, which establis h the panel's terms of reference under 
Article 7 of the DSU, and the arguments supporting those claims, which are set out 
and progressively clarified in the first written submissions, the rebuttal submissions and the first and second panel m eetings with the parties."
1071 
7.81 In other words, if a claim was properly put by New Zealand before the Panel, and 
New Zealand had submitted its arguments and ar ticulated its complaint, nothing prevents 
New Zealand from developing those arguments in the course of the proceedings and referring, if it wishes to do so, to information provided in Third Party submissions or in the responses provided by 
the scientific experts.  There are two limitations in  this regard.  First, the Panel is precluded from 
                                                     
 
1068 Appellate Body Report on US – Shrimp , para. 101 (original emphasis;  footnote omitted). 
1069 Australia's first written submission, para. 288. 
1070 Australia's first written submission, para. 420.  See also, Australia's first written submission, 
paras. 528, 611, 725, 883, 904 and 906. 
1071 Appellate Body Report on EC – Bananas III , para. 141 (original emphasis). WT/DS367/R 
Page 216  
 
 considering issues that fall outside the terms of reference approved by the DSB.  Second, Australia 
must be granted the right to respond to any argumen ts made by the complainant and to provide its 
own counter arguments and relevant evidence.  Of course, the burden is still on New Zealand, as the 
complainant, to develop its prima facie case that the challenged measures are in breach of Australia's 
obligations under the relevant provisions of the covere d agreements.  With respect to this last point, 
there is an important limitation of a panel's "signi ficant investigative authority", which the Appellate 
Body has explained as follows: 
"[T]his authority cannot be used by a panel to rule in favour of a complaining party 
which has not established a prima facie case of inconsistency based on specific legal 
claims asserted by it.  A panel is entitle d to seek information and advice from experts 
and from any other relevant source it chooses,  pursuant to Article 13 of the DSU and, 
in an SPS case, Article 11.2 of the SPS Agreement , to help it to understand and 
evaluate the evidence submitted and the arguments made by the parties, but not to make the case for a complaining party."
1072 
7.82 In conclusion, to the extent that a specific i ssue raised by a Third Party was properly within 
the Panel's terms of reference, and that New Zeal and had submitted its argumen ts and articulated its 
complaint with respect of the specific claim, th e Panel rejects Australia's proposition that it was 
prevented from addressing that issue in the written questions posed to the experts.  To the same 
extent, the Panel also rejects Australia's proposition that it is prevented from considering information 
provided by the scientific experts in response to the Panel's questions.  The Panel finds no evidence 
that due process has been negatively affected for any of these two reasons. 
(d) Whether the Panel should disregard opinions expressed by the scientific experts outside of the 
field of expertise for which they were selected 
7.83 Australia asserts that some of the written questi ons that were put to the experts by the Panel 
on 16 January 2009 would have re quired specialist expertise and experience in areas other than the 
respective expertise of the selected experts.1073  In response to the Panel's questions to the Parties after 
the second substantive meeting, Australia identifie d the following questions posed by the Panel as 
being outside of the field of expertise for which each of the experts was selected:  4, 5, 21, 66, 67, 89 
and 121.1074 
7.84 According to Australia, questions 4 and 5 relate to Australia's quarantine practices, an area in 
which none of the experts selected had expertise.1075  Australia requests that the responses to questions 
4 and 5 "should not be drawn on to the extent [the  experts] express a view on Australia's quarantine 
practices."1076 
7.85 Australia argues that questions 21, 89 and 121 assume that the experts have "expertise in the 
waste management practices of Australian packing houses".  Australia adds however, that it has no 
objection to the answers to questions 21 and 121, because the respective experts expressed no opinion 
on the handling of waste apples at Australian packing houses.1077  Australia objects to the experts' 
responses on question 89, asserting that the respective experts had based their replies "on speculation 
about the waste management practices of Australian packing houses".1078 
                                                      
1072 Appellate Body Report on Japan – Agricultural Products II , para. 129. 
1073 Australia's comments on the experts' replies, para. 13. 
1074 Australia's reply to Panel question 20 after the second substantive meeting, para. 72. 
1075 Australia's reply to Panel question 20 after the second substantive meeting, para. 74. 
1076 Australia's reply to Panel question 20 after the second substantive meeting, para. 75. 
1077 Australia's reply to Panel question 20 after the second substantive meeting, paras. 77 and 80. 
1078 Australia's reply to Panel question 20 after the second substantive meeting, paras. 78-79.  WT/DS367/R 
 Page 217 
 
 
 7.86 Finally, Australia argues that questions 66 an d 67 require special expertise in climatic 
conditions in Australia and New Zealand, respectively.1079  Australia requests that the Panel not draw 
on the experts' responses expressing a view  on the Parties' climatic conditions.1080 
7.87 As a related argument, Australia adds that, b ecause of the lack of guidance provided by the 
Panel in the Guidelines for Experts dated 16 January  2009, in their responses some of the experts 
moved beyond the area of expertise for which each had been selected.1081  Recalling the ruling of the 
Appellate Body in the US/Canada – Continued Suspension  dispute, Australia suggests that the Panel 
improperly gave experts "wide latitude " by failing to request that they answer questions only in the 
field of expertise for which they were selected and,  consequently, there was a lack of fairness in the 
consultation process.1082  Accordingly, Australia requests that the Panel refrain from drawing "in its 
report on the responses to those questions where [the experts] go to matters outside [their respective] 
fields of expertise."1083 
7.88 New Zealand rejects Australia's argument that  the experts responded to questions in areas 
where they lacked specific experti se.  According to New Zealand, in answering questions 4 and 5, 
experts were not required to draw on specific knowle dge of Australia's quarantine systems, but were 
rather asked to base their responses on the IRA and the Parties' arguments.1084  New Zealand notes 
additionally that Australia did not object to question 67 (draft question 64) when it was originally proposed by the Panel.
1085  In New Zealand's view, in their responses to questions 66 and 67 the 
experts limited themselves to expressing their views on the treatment of climate in the IRA and to assisting the Panel in evaluating evidence brought befo re the Panel, both functions being within the 
legitimate role of experts.
1086 
7.89 New Zealand adds that question 89, like qu estions 21 and 121, focused on the "'IRA's 
consideration' of the issue of waste management pr actices".  In other words, experts were being asked 
to assist the Panel in understanding evidence brought before it, which again is a legitimate role of 
experts.1087 
7.90 Finally, New Zealand considers that there is  no basis for Australia's analogy regarding the 
present case and the reasoning of the Appellate Body on the "wide latitude" accorded to experts in the 
US/Canada – Continued Suspension  dispute.  The US/Canada – Continued Suspension  dispute 
concerned: 
"[T]he fact that the experts were not limite d in their answers to assisting the panel to 
understand the ... JECFA risk assessment (which  they had helped draft) but rather 
were asked to respond to questions about th e adequacy of the EC 's risk assessment 
                                                      
1079 Australia's reply to Panel question 20 after the second substantive meeting, paras. 81-83. 
1080 Australia's reply to Panel question 20 after the second substantive meeting, paras. 82-83. 
1081 Australia's comments on the experts' replies to questions, Australia's communication to the Panel, 
25 March 2009, para. 17.  See also, Australia's reply to Panel question 20 after the second substantive meeting, para. 90. 
1082 Australia's reply to Panel question 20 after the second substantive meeting, paras. 91-92. 
1083 Australia's reply to Panel question 20 after the second substantive meeting, para. 92. 
1084 New Zealand's comments on Australia's reply to Panel question 20 after the second substantive 
meeting, para. 40. 
1085 New Zealand's comments on Australia's reply to Panel question 20 after the second substantive 
meeting, para. 42. 
1086 New Zealand's comments on Australia's reply to Panel question 20 after the second substantive 
meeting, para. 43. 
1087 New Zealand's comments on Australia's reply to Panel question 20 after the second substantive 
meeting, para. 41. WT/DS367/R 
Page 218  
 
 (which was directly critical of the JECFA risk assessment).
1088  This raised justifiable 
doubts as to the independence and impartiality of the two experts' replies to these 
questions and, therefore, gave rise to a due process concern".1089 
New Zealand submits that, in the present case, Australia has not raised concerns about the 
independence and impartiality of the experts, and the issue is rather whether the experts should have 
been prevented from answering questions which they felt competent to answer.1090 
7.91 The common element of Australia's concerns in re lation to this point refers to the competence 
of the scientific experts selected by the Panel to respond to specific questions posed by the Panel and 
whether the experts may have exceeded their sp ecific expertise in some of their responses. 
7.92 The Panel recalls its broad authority, under th e DSU and the Working Procedures, to decide 
on the final form of the questions that it would pose to the experts.1091  In each case, questions are 
related to Australia's IRA and to evidence brought be fore the Panel, with the objective of seeking the 
experts assistance to gain a better understanding of th e scientific basis and the reasoning contained in 
Australia's IRA. 
7.93 Questions 4 and 5, for example, request the e xperts to base their responses "on the relevant 
parts of Australia's IRA, and Parties' arguments" in order to help understand Australia's practice in 
audits and inspections with regard to the three pest s at issue, namely fire blight, European canker and 
ALCM.  The questions refer specifically to measur es identified by the IRA.  In their respective 
responses to questions 4 and 5, Dr Paulin, Dr Schrader and Dr Swinbur ne explicitly reference 
Australia's IRA or evidence provided by Australia.1092  In other words, both questions focus on the 
IRA and not on Australia's qua rantine practices generally. 
7.94 As regards questions 21, 89 and 121, Australia objected to a similar question in the list of 
proposed questions to experts (draft question 121) on  the grounds that "none of the experts have been 
appointed for any expertise in Australia's fruit fly management practices  and therefore may have 
difficulty answering this question".1093  In response to the Panel's qu estions to the Parties after the 
second substantive meeting, Australia argues that dr aft question 121 was reformulated so as "to ask 
about the risk associated with waste being left exposed at Australian packing houses, 'taking into 
account the likelihood of this situation occurring in packing houses in Australia'. ... The revised 
question was also asked as Question 21 under fire blight and Question 89 under European canker."1094  
Although Australia refers to questi ons 21, 89 and 121 as "new questions", in fact as the Panel has 
already noted they are mere reformulations of draft question 121.1095  Australia argues that questions 
21, 89 and 121 assumed that the experts had "expertise in the waste management practices of 
Australian packing houses".  Australia adds that, in  any event, the respective experts had expressed no 
opinion on the handling of waste apples at Australian packing houses, so Australia had no objection to 
their answers on questions 21 and 121.1096  Australia objected to the experts' responses to question 89, 
asserting that in this case the respective experts had based their replies "on speculation about the 
                                                      
1088 (footnote original ) Appellate Body Report, Canada – Continued Suspension, paras. 461-463. 
1089 New Zealand's comments on Australia's reply to Panel question 20 after the second substantive 
meeting, paras. 46-51. 
1090 New Zealand's comments on Australia's reply to Panel question 20 after the second substantive 
meeting, para. 52. 
1091 See paras. 7.55 and 7.57 above. 
1092 Dr Paulin's, Dr Schrader's and Dr Swinburne's replies to Panel questions 4 and 5, in List of Replies 
from the scientific experts to questions posed by the Panel, paras. 34-36, 41-42 and 43. 
1093 Australia's communication to the Panel, 19  December 2008, p. 87 (emphasis added). 
1094 Australia's reply to Panel question 20 after the second substantive meeting, para. 76. 
1095 See para. 7.45 above. 
1096 Australia's reply to Panel question 20 after the second substantive meeting, paras. 77 and 80.  WT/DS367/R 
 Page 219 
 
 
 waste management practices of Australian packing houses".1097  The question refers to "the 
consideration in Australia's IRA of the risk associ ated with the practice of packing houses leaving 
orchard wholesaler waste uncovered and exposed to the elements ... taking into account the likelihood 
of this situation occurring in packing houses in Austra lia."  The main focus of the question, again, is 
on the evidence and the reasoning contained in Australia 's IRA.  As noted above, Australia ultimately 
did not maintain its objection to questions 21 and 121.   With respect to question 89, in the light of 
Australia's objection, the Panel will disregard the experts' responses. 
7.95 Contrary to Australia's contention, questions 66 and 67 do not require special expertise in 
climatic conditions in Australia and New Zealand.  The main focus of both questions is rather the 
climatic conditions required for the entry, establishm ent and spread of European canker.  Question 66 
asks for the experts' assistance to help the Panel an alyse whether the scientific research relating to 
European canker relied upon by Australia's IRA is rele vant to climatic conditi ons in Australia and to 
the risks of N. galligena  associated with apples from New Zealand.  Question 67 focuses on whether 
Australia's IRA provides a coherent and analysis of  conidia and ascospore production and dispersal in 
the light of climatic conditions in New Zealand's apple-growing regions during harvest time.  For the 
purpose of responding to both questions, experts we re referred to arguments and evidence advanced 
by the Parties. 
7.96 In conclusion, there is no ev idence that questions 4, 5, 66 or 67 were inappropriately 
formulated by the Panel.  None of these questions required scientific experts to go beyond the field of 
expertise for which each one was selected.  Each of  these questions relates to issues that are essential 
for the Panel to understand the scientific basis unde rlying Australia's IRA, and whether the reasoning 
articulated in the IRA on the basi s of the scientific evidence is c oherent and objective.  As for 
question 89, in the light of Australia's objection,  the Panel will disregard the experts' responses. 
7.97 An additional point relates to whether the Pane l failed to provide adequate guidance to the 
experts when posing its written qu estions on 16 January  2009 and improperly allowed them "wide 
latitude" in their responses.  Australia notes that in  its comments on the draft list of questions provided 
to the Parties on 15 December 2008, it suggested th at the Panel instruct experts to "answer only 
questions in the field in relation to whic h [each was] appointed by the Panel (i.e. Erwinia amylovora , 
Neonectria galligena , Dasineura mali or pest risk analysis)" and "within [each one's] appointed field, 
[to] only answer questions on whic h [each had] direct expertise".1098  The Panel did not consider that 
such modified guidance was appropriate.  Instead,  when posing written questions to the experts on 
16 January 2009, the Panel instructed them to "ans wer only those questions that [they felt] competent 
to answer". 
7.98 The fact that the Panel has recognized and selected an individual expert for his or her 
specialized knowledge in a particular area does not mean that this expert's advice cannot also be 
useful to the Panel in other related areas.  The qualifications and expertise of the scientific experts 
selected by the Panel demonstrate a strong specia lization in specific areas  for which they were 
selected, but also show that their respective areas of expertise are not necessarily limited to those 
specific areas.1099  For example, Dr Jerry Cross is also specialized in "Pest Management and spray 
application of fruit and other crops" and h as thirty years of relevant experience.1100  According to their 
curricula vitae , Dr Deckers and Dr Paulin have extensivel y published on fire blight and both Parties 
                                                      
1097 Australia's reply to Panel question 20 after the second substantive meeting, paras. 78-79. 
1098 Australia's communication to the Panel, 19 Decembe r 2008, p. 2-4.  See al so, Australia's comments 
on the experts' replies to questions, Australia's communication to the Panel, 25 March 2009, para. 17. 
1099 Panel's communication to the Parties, 5 December 2008, whereby the Panel sent a set of documents 
detailing experts' curricula vitae . 
1100 Curriculum of Dr Jerry Cross, page 3, in Panel's communication to the Parties, 5 December 2008. WT/DS367/R 
Page 220  
 
 acknowledged their strong expertise.
1101  At the same time, these three experts could also provide 
useful advice on a number of questions related to risk assessment and give an opinion on questions 
involving related issues. 
7.99 The Panel is satisfied that it had the benef it of receiving the advice of seven individual 
scientific experts, with high qualifications and exper tise.  In the absence of an y specific concerns that 
would suggest otherwise, the Panel felt that it should leave it to each expert to respond to the 
questions they felt competent to answer.  There was no reason to exclude a priori  the possibility that 
one expert could provide important information on a question originally devised for another area.  In 
the Panel's view, from a procedural perspective, the most important factor to bear in mind was that 
Parties be granted the opportunity to comment on the experts' responses and to pose their own 
questions to the experts.  In accordance with th e Working Procedures and the timetable, Parties had 
ample opportunities for this. 
7.100  Whether in practice any of the experts provided views that went beyond the expert's field of 
expertise is something that can only be considered on a case-by-case basis, in the light of the specific 
response.  There is no reason for the Panel to disregard a priori  the responses of any expert.  In any 
event, regardless of the discretion allowed to the e xperts, the Panel is not bound by the views of the 
scientific experts it has selected.  Ultimately, it is  the responsibility of the Panel – and not of the 
experts – to conduct an objective assessment of the matter. 
7.101  In conclusion, there is no indication that the Pa nel posed questions to the experts that would 
have required specialist expertise and experience in ar eas outside of their respective expertise, nor that 
the Panel should reject a priori  the responses provided by any of the experts on the grounds that the 
expert expressed views outside the area of expertise for which he or she was appointed. 
4. General conclusion on Australia's concern s regarding the process of selection and 
consultation of experts 
7.102  In conclusion, and for the reasons stated above , the Panel finds no evidence that the process 
of selecting and consultating expe rts was conducted improperly, that due process in the experts 
consultation phase of these proceedings was compromised , nor that Australia's procedural rights were 
in any manner negatively affected in this regard. 
B. WHETHER THE MEASURES IDENTIFIED BY NEW ZEALAND ARE CHALLE NGEABLE UNDER THE 
SPS  AGREEMENT  
1. Summary of the Parties' arguments 
7.103  In its first written submission New Zealand ch allenges, "individually and as a whole", each of 
the measures identified in its panel request.1102  It asks the Panel to rule separately on each measure1103 
in line with the Japan – Apples (Article 21.5 – US)  dispute1104, and because a failure to do so would 
not fully resolve the current dispute.1105  New Zealand argues that the specific measures identified in 
its panel request are SPS measures that "affect intern ational trade" within the meaning of Article 1.1 
of the SPS Agreement, and serve the purposes enshrine d in subparagraphs 1(a) and (d) of Annex A of 
                                                      
1101 Australia's and New Zealand's 's communications to the Panel, 20 November 2008. 
1102 New Zealand's first writte n submission, para. 3.89. 
1103 New Zealand's first writte n submission, para. 3.92. 
1104 New Zealand's first written s ubmission, paras. 3.90-3.91. 
1105 New Zealand's first writte n submission, para. 3.92.  WT/DS367/R 
 Page 221 
 
 
 the Agreement.1106  Also, New Zealand adds, any apple imports from New Zealand to Australia 
depend on compliance with "each and every measure … in the IRA."1107 
7.104  Australia responds that "New Zealand has not established that all measures are challengeable 
under the relevant provisions of the SPS Agreement."1108  This is an "important threshold issue"1109, 
and "the onus is on New Zealand to estab lish that each of the measures challenged, individually and 
as a whole , meets the definition of 'SPS measure'."1110 
7.105  Australia argues that potential trade impact is  not relevant for defining an SPS measure.1111  
Rather, "the definition … in Annex A(1) is purpose-driven"1112:  an SPS measure must seek to protect 
against specific categories of risk.1113  Australia submits that a measure that is "applied:  to protect" 
against SPS risks, as required by the definition in An nex A(1), must be a measure that aims to reduce 
those risks.1114  In this context, some of the measur es are only ancillary, in that they merely 
"support, verify and operationali se" other, principal measures.1115  Namely, as regards fire blight, 
Measures 3, 4 and 8 are ancillary to Measures 1, 2 a nd 5 taken together, and M easure 7 is ancillary to 
Measure 6, with the principal measures (Measures 1,  2 ,5 and 6) constituting a "systems approach".1116  
For European canker, Measure 11 is ancillary to Measures 9, 10 and 13 taken together.  Finally, 
Measure 14 on ALCM is a principal measure, while the three general measures (Measures 15-17) are 
all ancillary measures.1117 
7.106  Australia acknowledges that on its face the defi nition of SPS measures in Annex A(1) of the 
SPS Agreement does not create a distinction between pr incipal and ancillary measures.  Yet, such a 
distinction is implicit from reading that definiti on together with the non-appealed panel report in 
US - Export Restraints .1118  Based on that report, the question is "whether each measure operates in its 
own right", that is "whether each measure constitu te[s] an instrument with a functional life of its 
own."1119  According to Annex A(1) of the SPS Agreement, SPS measures are those which are 
"applied:  to protect" against particular categories of SPS risks.1120  Also, Australia considers that 
various ISPMs implicitly distinguish measures inte nded to actively reduce risks, from verification 
measures that are not.1121 
7.107  Australia concludes that its ancillary measures "cannot be challenged on an individual basis";  
but only "when 'taken together' (or 'as a whole') with the [relevant] principal risk management 
measures."1122  Australia contends that these arguments do not raise systemic concerns since the 
                                                      
1106 New Zealand's first written submission, para. 3. 87.  See also New Zealand's reply to Panel 
question 13 after the first substantive meeting, paras. 22-26. 
1107 New Zealand's first writte n submission, para. 3.89. 
1108 Australia's first written submission, paras. 130-131. 
1109 Australia's second written submission, para. 62. 
1110 Australia's first written submission, para. 131 (original emphasis;  footnote omitted). 
1111 Australia's second written submission, para. 72. 
1112 Australia's second written submission, para. 67. 
1113 Australia's closing oral statement at the first su bstantive meeting of the Panel with the Parties, 
para. 8. 
1114 Australia's second written submission, para. 68. 
1115 Australia's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 23. 
1116 Australia's first written submission. paras. 139-140. 
1117 Australia's reply to Panel questions after the first substantive meeting, Annex A. 
1118 Australia's reply to Panel question 23 after the first substantive meeting. 
1119 Australia's first written submission, paras. 136-137 quoting US – Export Restraints , para. 8.85. 
1120 Australia's reply to Panel question 14 after the first substantive meeting. 
1121 Australia's reply to Panel question 24 after the first substantive meeting, and Annex B. 
1122 Australia's first written submission, para. 146.  See also ibid., paras. 141 and 144;  Australia's 
opening oral statement at the first substantive me eting of the Panel with the Parties, para. 23. WT/DS367/R 
Page 222  
 
 distinction between principal and ancillary measur es does not undermine the ability of all measures to 
be properly disciplined, and would not permit Australia to avoid compliance.
1123  In fact, 
Australia "acknowledge[s] that the Panel may make  findings under the SPS Agreement in respect of 
all of the measures at issue (but not all of them individually )."1124  Australia does not dispute that all of 
the measures at issue may be challengeable in WT O dispute settlement, but argues that whether they 
are SPS measures is a different question.  In its view, New Zealand was free to make allegations 
under other WTO provisions in addition to cl aims under the SPS Agreement, as previous 
complainants in SPS disputes have done.1125 
7.108  In response, New Zealand argues that Australia's  distinction between principal and ancillary 
measures is "spurious"1126:  it serves only "to avoid scrutiny [of the ancillary measures] under 
Articles 2.2 and 5.1" of the SPS Agreement1127, which would be inconsistent with the object and 
purpose of the Agreement.1128  The distinction would also allow Members to bypass their obligations 
under the SPS Agreement by combining broad SPS-co mpliant measures with non-complying ancillary 
measures.1129 
7.109  New Zealand recognizes the close relationship betw een some of the measures, and that "some 
may even be characterised as supporting, ve rifying or operationalising other measures."1130  But the 
key point is that "all of the measures are aimed in some way at protecting against alleged SPS risks"
1131:  each of them "operates in a concrete way in its own right."1132  The allegedly ancillary 
requirements are separate from the relevant principa l requirements, they are enforced separately in 
time, and entail additional burdens.1133 
7.110  According to New Zealand, under Article 1 of the SPS Agreement, all SPS measures that 
affect international trade are challengeable under the SPS Agreement.1134  The wording of Annex A(1) 
of the Agreement does not distinguish principal and ancillary measures, or require that SPS measures 
"actively" reduce risks.1135  Rather, the definition applies to "a ny" measure applied to protect against 
risks.1136  Also, Australia's reliance on US – Export Restraints is "misplaced" because that case is 
limited to the SCM Agreement.1137  In any event, "the US – Export Restraints case … cannot … 
override the clear definition of SPS measures in the SPS Agreement."1138 
7.111  New Zealand adds that the distinction between ancillary and principal measures is "confusing 
and unworkable."1139  Some of the allegedly ancillary measur es actively contribute to risk reduction, 
                                                      
1123 Australia's second written submission, paras. 75-76. 
1124 Australia's second written submission, para. 75 (original emphasis). 
1125 Australia's second written submission, para. 76. 
1126 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 29. 
1127 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 31. 
1128 New Zealand's second writte n submission, para. 2.7. 
1129 New Zealand's reply to Panel question 22 af ter the first substantive meeting, para. 30. 
1130 New Zealand's second writte n submission, para. 2.11. 
1131 Ibid. 
1132 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 30. 
1133 New Zealand's second writte n submission, para. 2.9. 
1134 New Zealand's reply to Panel question 13 after the first substantive meeting, paras. 22-24. 
1135 New Zealand's second writte n submission, para. 2.5. 
1136 Ibid. 
1137 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
paras. 29-30. 
1138 New Zealand's second writte n submission, para. 2.8. 
1139 New Zealand's second written submission, 2.4.  WT/DS367/R 
 Page 223 
 
 
 and the experts disagree on the categorization of the measures.1140  Also, the examples in the 
definition of SPS measures under Annex A(1) include "testing, inspection, certification and approval 
proceedings", which are the very kind of me asures that Australia identifies as ancillary.1141 
7.112  Finally, New Zealand questions the need for di stinguishing principal and ancillary measures, 
since Australia agrees that the Pane l may evaluate the consistency of all allegedly ancillary measures 
when taken together with the relevant principal measure(s).1142  According to New Zealand, even if 
some of the measures at issue were treated as part of a broader SPS measure, "this does not prevent the Panel from making specific findings on each of th e individual elements, as was the approach taken 
by the [p]anel in Japan – Apples (21.5) ."
1143 
2. The Panel's analysis 
7.113  At the outset of its analysis, the Panel recalls that New Zealand's panel request claims that 
"the ... measures [at issue] are inconsistent with Australia's obligations under [nine provisions] of the 
SPS Agreement."1144  Reviewing the consistency of this pane l request with Article 6.2 of the DSU, 
the Panel in its preliminary ruling endorsed the understanding that New Zealand has claimed that 
every measure at issue is inconsistent with each  of the nine provisions mentioned in the panel 
request.1145 
7.114  As shown by the summary of the Parties' arguments, neither Party contests that the 
16 measures at issue in this dispute (Measures 1- 11 and 13-17) constitute measures reviewable in 
WTO dispute settlement.1146  But whether the 16 measures constitute SPS measures is a different 
matter.  As the panel in EC – Approval and Marketing of Biotech Products  stated, "not every measure 
that qualifies as a measure within the meaning of the DSU constitutes, ipso facto , an 
SPS measure."1147 
7.115  The Parties agree that the 16 measures can be reviewed as a whole under the 
SPS Agreement.1148  But New Zealand also claims a violation of the relevant SPS provisions by each 
of the 16 measures individually, which Australia cont ests.  Therefore, the question before the Panel is 
whether individually each of the 16 measures is an SPS measure, or rather whether some of them are 
ancillary measures and can only be  reviewed under the SPS Agreement jointly with other, principal 
measures. 
7.116  The Parties agree that this is a legal issue to be reviewed in the light of Annex A(1) of the 
SPS Agreement1149, which contains the "legal definition of the term 'SPS measure'."1150  New Zealand 
                                                      
1140 New Zealand's second writte n submission, para. 2.14. 
1141 New Zealand's second writte n submission, para. 2.6. 
1142 New Zealand's opening oral statement at the s econd substantive meeting of the Panel with the 
Parties, para. 16. 
1143 New Zealand's comments on Australia's reply to Panel questions 17 and 18 after the second 
substantive meeting, para. 32. 
1144 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Anne x A-1 to this report, p. 3. 
1145 Australia – Apples , Communication From the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, p. 3. 
1146 See, in particular, Australia's second written submi ssion, paras. 75-76.  For the identification of the 
measures, see para. 2.91 above. 
1147 Panel Report on EC – Approval and Marketing of Biotech Products , para. 7.1333. 
1148 New Zealand's first written submission, para. 3.89;  and Australia's second written submission, 
para. 75. 
1149 New Zealand's second written submission, para. 2.16;  and Australia's comments on the experts' 
replies, para. 295. WT/DS367/R 
Page 224  
 
 argues that each of the 16 measures fulfils the pur poses set out in subparagraphs 1(a) and (d) of 
Annex A of the SPS Agreement.
1151  In relevant part, Annex A(1) defines "[s]anitary or phytosanitary 
measure" as: 
"[a]ny measure applied: (a) to protect animal or plant life or h ealth within the territory of the Member 
from risks arising from the entry, estab lishment or spread of pests, diseases, 
disease-carrying organisms or disease-causing organisms; 
... or (d) to prevent or limit other damage with in the territory of the Member from the 
entry, establishment or spread of pests. 
Sanitary or phytosanitary measures include 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 requi rements associated with the transport of 
animals or plants, or with the materials n ecessary for their survival during transport;  
provisions on relevant statistical methods , sampling procedures and methods of risk 
assessment;  and packaging and labelling requirements directly related to food 
safety." 
7.117  The EC – Approval and Marketing of Biotech Products panel identified three elements in 
Annex A(1) of the SPS Agreement: 
"Annex A(1) indicates that for the purposes of determining whether a particular 
measure constitutes an 'SPS measure' regard must be had to such elements as the 
purpose of the measure, its legal form and its nature.  The purpose element is addressed in Annex A(1)(a) through (d) ('any measure applied to').  The form element 
is referred to in the second paragraph of Annex A(1) ('laws, decrees, regulations').  
Finally, the nature of measures qualifyi ng as SPS measures is also addressed in the 
second paragraph of Annex A(1) ('requi rements and procedures, including, inter alia , 
end product criteria;  processes and pr oduction methods;  testing, inspection, 
certification and approval procedures;  [etc.]')."
1152 
7.118  The Panel agrees that purpose, as set out in su bparagraphs (a)-(d), is an essential criterion for 
assessing whether a measure amounts to an SPS me asure under Annex A(1).  In the light of 
New Zealand's arguments and the approach of the EC – Approval and Marketing of Biotech Products  
panel1153, this Panel will identify the purpose of the 16 measures and assess whether they correspond 
to subparagraphs (a) or (d) of Annex A(1) of the SPS Agreement. 
7.119  The Panel also agrees that the form and natu re of alleged SPS measures are relevant for 
assessing whether the measures fall within the definiti on in Annex A(1).  But, for reasons specified 
below, this Panel has a slightly different readi ng of how these two elements (form and nature) are 
                                                                                                                                                                     
1150 Panel Report on EC – Approval and Marketing of Biotech Products , para. 7.148. 
1151 New Zealand's first written submission, para. 3. 87.  See also New Zealand's reply to Panel 
question 13 after the first substantive meeting, para. 23. 
1152 Panel Report on EC – Approval and Marketing of Biotech Products , para. 7.149.  See also ibid., 
para. 7.1334;  and Panel Report on Canada – Continued Suspension , para. 7.420;  and Panel Report on US – 
Continued Suspension , para. 7.429. 
1153 Panel Report on EC – Approval and Marketing of Biotech Products , para. 7.196 et seq .  WT/DS367/R 
 Page 225 
 
 
 reflected in Annex A(1) than the reading adopted by the EC – Approval and Marketing of Biotech 
Products  panel. 
7.120  Before analysing the purpose, and the form and nature of the 16 measures, the Panel points 
out that effect on trade is not relevant for assessing whether a measure qualifies as an SPS measure under Annex A(1).  As the Japan – Apples panel held, "the definition in  Annex A, paragraph 1, does 
not consider the trade effect of a given measure as a factor to determine whether such a measure is or 
is not a phytosanitary measure."
1154  Rather, effect on trade is relevant for assessing whether the 
SPS Agreement applies to what has already been determined an SPS measure.  As the EC –
 Hormones panels stated, "[a]ccording to Article 1.1 of the SPS Agreement, two requirements need to 
be fulfilled for the SPS Agreement to apply:  (i) th e measure in dispute is a sanitary or phytosanitary 
measure1155;  and (ii) the measure in dispute may, direct ly or indirectly, affect international trade.1156"1157 
7.121  This concept of effect on trade has been interpreted broadly.  According to the EC – Approval 
and Marketing of Biotech Products panel, to be subject to the disciplines of the SPS Agreement, "[i]t 
is not necessary to demonstrate that an SPS measure h as an actual effect on trade.  Article 1.1 merely 
requires that an SPS measure 'may, directly or indirectly, affect international trade'."1158 
7.122  Clearly, the 16 measures satisfy this criterion of  actual or potential effect on international 
trade, both individually and as a whole.  The Parties agree that the 16 measures are spelt out in the IRA.
1159  As quoted in New Zealand's panel request, Australia's Biosecurity Australia Policy 
Memorandum 2007/07  links the importation of New Zealand appl es to the application of the measures 
specified in the IRA.1160  New Zealand argues and Australia ac knowledges that compliance with all of 
the 16 measures is a precondition for allowing the im portation of apples from New Zealand;  lack of 
compliance with any of the measures may lead to the suspension of apple imports to Australia from 
New Zealand.1161 
(a) The purpose of the 16 measures 
7.123  As indicated earlier, the Panel will assess the purpose of the 16 measures and verify whether 
they correspond to subparagraphs (a) or (d) of Annex A(1) of the SPS Agreement, which define 
"[s]anitary or phytosanitary measure". 
7.124  The Parties agree that all 16 measures are set out in the IRA.  The IRA is an integral 
component of Australia's biosecurity regime.  The IRA explains that the legislative basis for this 
regime is found in "the Quarantine Act 1908 and its subordinate legislation, including the Quarantine 
                                                      
1154 Panel Report on Japan – Apples , para. 8.24. 
1155 (footnote original ) As defined in Paragraph 1 of Anne x A of the SPS Agreement, quoted and 
discussed in paras. 8.21 and 8.22. 
1156 (footnote original ) See para. 8.23. 
1157 Panel Report on EC – Hormones (US) , para. 8.36, and Panel Report on EC – Hormones (Canada) , 
para. 8.39. 
1158 Panel Report on Approval and Marketing of EC – Biotech Products , para. 7.435.  See also Panel 
Report on Approval and Marketing of EC – Biotech Products , para. 7.2607;  Panel Report on EC – Hormones 
(US) , para. 8.23;  and Panel Report on EC – Hormones (Canada) , para. 8.26. 
1159 New Zealand's reply to Panel question 13 after the first substantive meeting, para. 25, and 
para. 2.97 above. 
1160 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A- 1 to this report, p. 1.  See, Bi osecurity Australia Policy Memorandum 
2007/07, in Exhibit NZ-2. 
1161 New Zealand's reply to Panel question 21 afte r the first substantive meeting, para. 27;  
New Zealand's second written submission, 2.9;  and Au stralia's reply to Panel question 16 after the first 
substantive meeting. WT/DS367/R 
Page 226  
 
 Proclamation 1998 , [which] are the legislative basis of human, animal and plant quarantine in 
Australia."
1162  The IRA cites "[s]ome key provisions"1163, the first one being: 
"Subsection 4 (1) of the Quarantine Act 1908 [, which]  defines the scope of 
quarantine as follows: 
'In this Act, quarantine includes, but is not limited to, measures 
(a) for, or in relation to: 
(i) the examination, exclusion, detention, observation, 
segregation, isolation, protection, treatment and regulation of vessels, inst allations, human beings, 
animals, plants or other goods or things;  or 
(ii) the seizure and destruction of animals, plants, or 
other goods or things;  or 
(iii) the destruction of premises comprising buildings or 
other structures when treatment of these premises is not practicable;  and 
(b) 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 .'"
1164 
7.125  The Quarantine Proclamation is the principal legal instrument to control importation to 
Australia of goods of quarantine (or biosecurity) interest.  Under this proclamation, the Director of 
Animal and Plant Quarantine is empowered to gr ant an import permit base d on, among other things, 
the information and policy recommendati ons in an import risk analysis.1165  The IRA indicates that its 
purpose is to deliver a policy recommendation to the Director of Animal and Plant Quarantine.1166 
7.126  The IRA and Biosecurity Australia Policy Memorandum 2007/07  explain that the IRA was 
prepared on the basis of the Import Risk Analysis Handbook  (2003).1167  In turn, the Import Risk 
Analysis Handbook  (2003) defines the "objective of Australian biosecurity policies" as "the 
prevention or control of the entry, establishment or  spread of pests and diseases that will or could 
cause significant damage to human beings, animals, plants, other aspects of the environment, or economic activities ."
1168 
                                                      
1162 Australia's IRA, Part B, p. 1.  See also, Austra lia's first written submission, para. 55;  Australia's 
second written submission, para. 210. 
1163 Australia's IRA, Part B, p. 1. 
1164 Ibid. (footnote omitted;  emphasis added). 
1165 Australia's IRA, Part B, p. 2.  See also, Australia's first written submission, para. 61. 
1166 Australia's IRA, Part B, p. 2.  See also, Australia's first written submission, paras. 62 and 64. 
1167 "This final report has been prepared as part of the IRA process as set out in the Import Risk 
Analysis Handbook (BA, 2003) ." Australia's IRA, Part A, p. 3.  "In response to applications from the 
New Zealand Government, Biosecurity Australia has comp leted an import risk analysis (IRA) in accordance 
with the provisions of the Import Risk Analysis Handbook ."  Biosecurity Australi a Policy Memorandum 
2007/07 , in Exhibit NZ-2, p. 1.  See also, Australia's first written submission, para. 65. 
1168 Import Risk Analysis Handbook  (2003), in Exhibit AUS-10, p. 5;  Biosecurity Australia Policy 
Memorandum 2007/07 , in Exhibit NZ-2.  WT/DS367/R 
 Page 227 
 
 
 7.127  Likewise, a specific part of the IRA, entitled "Risk management and sanitary and 
phytosanitary (SPS) measures"1169 provides that the purpose of the measu res is to protect the health of 
people, animals and plants:  "Australia's plant and animal health status is maintained through the 
implementation of measures to facilitate the importa tion of products while protecting the health of 
people, animals and plants."1170 
7.128  The same part of the IRA makes specific refe rence to the "appropriate level of protection 
from pests and diseases."1171  Further, the IRA describes import ri sk analysis as follows:  "In animal 
and plant biosecurity, IRA identifies the pests and diseases relevant to an  import proposal, assesses 
the risks posed by them and, if those risks are unacceptable, specifies what measures should be taken 
to reduce those risks to an acceptable level."1172 
7.129  Since the 16 measures are spelt out in the IR A, each of them pursues the above general 
objectives.  The next question is whether these objec tives correspond to either of those spelt out under 
subparagraphs (a) or (d) of A nnex A(1) of the SPS Agreement. 
(i) Subparagraph (a) 
7.130  The purpose set out in subparagraph (a) of Annex A(1) of the SPS Agreement is "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."  The Panel will consider whether the 16 measures, considering the IRA's general objectives identified 
above, satisfy the various terms a nd phrases included in subparagraph (a).
1173 
7.131  The first element of subparagraph (a) is "to protect animal or plant life or health".  The IRA 
and its basis, the Import Risk Assessment Handbook  (2003), explicitly refer to the objective of 
"protecting the health of ... animals and plants."1174  Since subparagraph (a) links the words "life" and 
"health" with the word "or", the purpose of the IRA – and the 16 measures spelt out therein – satisfy 
the first element of subparagraph (a).1175 
7.132  The second element of subparagraph (a) is "within  the territory of the Member".  The IRA – 
and the 16 measures spelt out therein – satisfy this el ement, too.  As indicated above, the 16 measures 
apply to apple imports from New Zealand to the entire territory of Australia.1176  Also, both the IRA 
and the Import Risk Assessment Handbook  (2003) mention " Australia's  plant and animal health 
status" in the context of ri sk management and SPS measures.1177  As noted in the IRA, "[t]he import 
risk analysis (IRA) process is an important part of  Australia's biosecurity policies.  It enables the 
Australian Government to consider formally the ri sks that could be associated with proposals to 
import new products into Australia."1178 
7.133  The third and final element of subparagraph (a) is "risks arising from the entry, establishment 
or spread of pests, diseases, disease-carrying organisms or disease-causing organisms".  The EC –
                                                      
1169 Australia's IRA, Part B, p.  5. 
1170 Ibid.  See also Import Risk Analysis Handbook  (2003), in Exhibit AUS-10, p. 5. 
1171 Australia's IRA, Part B, p.  5. 
1172 Ibid.  See also, Import Risk Analysis Handbook  (2003), in Exhibit AUS-10, p. 8. 
1173 Panel Report on EC – Approval and Marketing of Biotech Products , paras. 7.213 et seq. 
1174 Australia's IRA, Part B, p. 5.  See also, Import Risk Analysis Handbook  (2003), in Exhibit AUS-10, 
p. 5. 
1175 See also, Panel Report on EC – Approval and Marketing of Biotech Products , para. 7.239. 
1176 See para. 2.232 above. 
1177 Australia's IRA, Part B, p. 5;  and Import Risk Analysis Handbook  (2003), in Exhibit AUS-10, p. 5 
(emphasis added). 
1178 Australia's IRA, Part A, p. 3. WT/DS367/R 
Page 228  
 
 Approval and Marketing of Biotech Products panel found that the phrase "risks arising from" is 
"broad and unqualified"
1179, in that: 
"There is nothing in Annex A(1)(a) which indicates that potential risks to animal or 
plant life or health must necessarily be the direct or immediate result of, e.g., the spread of a pest. ...  We therefore do not consider that measures taken to 
protect animal or plant life or health from risks that arise indirectly or in the longer 
term from pests, diseases, disease-carrying organisms or disease causing organisms fall outside the scope of Annex A(1)(a)."
1180 
7.134  As a risk assessment, Australia's " Final Import Risk Analysis Report for Apples from 
New Zealand " deals with risks, namely risks aris ing from pests.  Both the IRA and the Import Risk 
Assessment Handbook  (2003) provide that "[i]n animal and plant biosecurity, IRA identifies the pests 
and diseases relevant to an import proposal, assesses th e risks posed by them and, if those risks are 
unacceptable, specifies what measures should be taken to reduce those risks to an acceptable 
level."1181  Further, the IRA states that the measures it sets out, including the 16 at issue in this 
dispute, are necessary to achieve its ALOP, by reducing unrestricted risk to a "very low" or 
"negligible" level.1182  In some cases, as for the pests at issu e in this dispute, the IRA indicates that a 
combination of measures is necessary to achieve the ALOP.1183 
7.135  As regards the word "pests", the IRA refers to fire blight, European canker, and ALCM, 
systematically as "pests".1184  Further, the IRA explains that: 
"The term 'pest' used throughout this [import risk analysis] is the collective term used 
for invertebrate pests, plant diseases, viruses, bacteria and fungi that could harm 
plants. The formal definition used is th e one provided in the International Plant 
Protection Convention (IPPC):  'any species, strain, or biotype of plant, animal or pathogenic agent injurious to plants or plant products'."
1185 
7.136  The EC – Approval and Marketing of Biotech Products  panel found that this IPPC definition 
of "pests", which is used by the IRA, is en compassed in the term "pests" under Annex A(1).1186  
Further, the EC - Approval and Marketing of Biotech Products panel defined "pests" under 
Annex A(1) as follows:  "in the context of the SPS Agreement the term 'pest' should be understood as 
referring to an animal or plant which is destructive,  or causes harm to the health of other animals, 
plants or humans, or other harm, or a troublesome or annoying animal or plant."1187 
7.137  As explained above, each of the 16 measures relates to at least one of the three pests at issue 
in this dispute.1188 
7.138  Further, the IRA deals with risks arising from th e entry, establishment and spread of pests.  
The IRA identifies the "assessment of the probability of entry, probability of establishment and 
                                                      
1179 Panel Report on EC – Approval and Marketing of Biotech Products , para. 7.226. 
1180 Ibid. 
1181 Australia's IRA, Part B, p. 5.  See also Import Risk Analysis Handbook  (2003), in Exhibit AUS-10, 
p. 8. 
1182 Australia's IRA, Part A, pp. 9 and 13. 
1183 Australia's IRA, Part B, pp. 105-115;  151-155;  187-192;  313-325. 
1184 Australia's IRA, Part A, pp. 11-13. 
1185 Australia's IRA, Part B, p. 1, footnote 1.  See also Ibid., p. 344. 
1186 Panel Report on EC – Approval and Marketing of Biotech Products , para. 7.241. 
1187 Panel Report on EC – Approval and Marketing of Biotech Products , para. 7.240. 
1188 See part II.D.2. above.  WT/DS367/R 
 Page 229 
 
 
 probability of spread" as a key elem ent of its "pest risk assessment".1189  The IRA then analyzes the 
"[p]robability of entry, establishment a nd spread" for each of the three pests1190, and identifies the 
measures necessary to manage the resulting risk, including the 16 measures at issue.1191 
7.139  Accordingly, the IRA and the 16 measures at i ssue in this case are clearly related to risks 
arising from the entry, establishment and spread of pests, in the sense of subparagraph (a) of 
Annex A(1) of the SPS Agreement. 
7.140  This applies to the 16 measures considered both collectively and individually.  As mentioned 
above, the Parties agree that all 16 measures are set out in the IRA, while under the IRA each measure 
would be indispensable for achieving Australia's ALOP , by reducing unrestricted risk to a "very low" 
or "negligible" level. 
7.141  The Panel finds further support for its conclusi on in the purpose of the various measures spelt 
out in the IRA either explicitly or implicitly, an d the close linkage of those purposes to managing 
risks: 
(a) The IRA explains in the context of Measure 1 that "individual apple orchards ... 
free from fire blight symptoms ... are know n to have lower levels of bacteria 
associated with fruit than orchards  where symptoms are evident."1192  The IRA adds 
that, "[w]ith lower bacterial populations in areas free from disease symptoms, the 
likelihood that clean fruit is contaminated during picking or transport to the packing 
house (imp3) could be expected to be significantly reduced."1193  Likewise, for 
imp5.1194 
(b) The IRA discusses Measures 2-5 under the s ub-heading "[f]ire blight symptoms"1195, 
and explains that "'freedom from visible symptoms' provide[s] a firm basis for risk 
reduction by substantially reducing the likeli hood that picked fruit is infected or 
infested."1196 
(c) The IRA clarifies that Measure 6 would "mitigate the risk of fire blight"1197, and as a 
result "the risk of E. amylovora  being present in or on apples for export would be 
reduced."1198 
(d) The IRA explains that the purpose of Measure 7 is the "[p]revention of contamination 
after the disinfection treatment."1199 
(e) The IRA clarifies that Measure 8 serves to "maintain the quarantine integrity of the 
commodity".1200  This is linked to the IRA's concern, under imp5, with clean fruit 
being contaminated by E. amylovora  during processing in the packing house.1201 
                                                      
1189 Australia's IRA, Part B, p. 13. 
1190 See Australia's IRA, Part B, pp. 80-97 (fire blight), pp. 129-145 (European canker), and pp. 158-
166 (ALCM). 
1191 Australia's IRA, Part B, p. 313. 
1192 Australia's IRA, Part B, p. 105. 
1193 Australia's IRA, Part B, p. 106. 
1194 Australia's IRA, Part B, p. 107. 
1195 Australia's IRA, Part B, p. 316. 
1196 Australia's IRA, Part B, p. 106. 
1197 Australia's IRA, Part B, p. 105. 
1198 Australia's IRA, Part B, p. 108. 
1199 Australia's IRA, Part B, p. 318. WT/DS367/R 
Page 230  
 
 (f) The IRA explains that the purpose of Measu re 9 is "to mitigate the annual risk" of 
European canker, and it describes Measure 9 as "an effective risk management measure for N. galligena ."
1202 
(g) The IRA introduces Measure 10 by stating that it serves to establish "Orchard 
freedom from European canker".1203  In the context of this measure, the IRA sets out 
less stringent inspection requirements to assess "orchard freedom from European 
canker"1204 "[i]n areas where climatic conditions are less favourable for disease 
establishment and spread"1205 and more stringent inspec tion requirements "[i]n areas 
where environmental conditions are more  conducive to disease establishment and 
spread."1206 
(h) The IRA introduces Measure 11 by specifically stating that "[i]nfected nursery stock 
presents a pathway for the establishment and spread of European canker into places 
of production."1207  Further, the IRA states that Measures 10 and 11 for 
European canker "would prevent opportunities for the disease to enter and establish in 
Australia ..."1208 
(i) The IRA spells out Measure 13 as a "re quirement" for "[r]isk management for 
European canker."1209 
(j) The IRA introduces Measure 14 stating that it "will address the risk associated with 
apple leafcurling midge."1210 
(k) Under the haeding "Risk management and operational framework", the IRA 
references various risk management measur es.  This section spells out various 
measures, including the general measures (Measures 15-17), each of which as a 
whole relates to all three pests, describi ng those measures as "further details on the 
recommended quarantine conditions (risk management measures together with 
phytosanitary procedures) ... required to manage the quarantine risks."1211  F u r t h e r ,  
the IRA sets out Measure 16 because "the risk analysis [in the IRA] and the 
recommended risk management measures are based on apples produced under normal 
commercial production practices".1212 
(ii) Subparagraph (d) 
7.142  Subparagraphs (a) and (d) of Annex A(1) of the SPS Agreement do not establish cumulative 
requirements with regard to the purpose of SPS meas ures.  It is sufficient for the purpose of the 
16 measures to correspond to either of those subpa ragraphs.  The Panel has found that the purpose of 
the IRA, and each of the 16 measures containe d therein, corresponds to subparagraph (a).  
                                                                                                                                                                     
1200 Australia's IRA, Part B, p. 317. 
1201 See Australia's IRA, Part B, pp. 77 et seq.  
1202 Australia's IRA, Part B, p. 153. 
1203 Ibid. 
1204 Ibid. 
1205 Ibid. 
1206 Australia's IRA, Part B, p. 154.  See also, Australia's IRA, Part B, p. 316. 
1207 Australia's IRA, Part B, p. 154. 
1208 Ibid. 
1209 Australia's IRA, Part B, p. 316. 
1210 Australia's IRA, Part B, p. 319.  
1211 Australia's IRA, Part B, p. 313. 
1212 Australia's IRA, Part B, p. 315.  See also, Australia's IRA, Part B, p. 105.  WT/DS367/R 
 Page 231 
 
 
 Accordingly, it is not necessary to assess whether th e purpose of the IRA, and 16 measures contained 
therein, corresponds to subparagraph (d). 
(b) The form and nature of the 16 measures 
7.143  In addition to purpose, the EC – Approval and Marketing of Biotech Products  panel identified 
two additional and separate elemen ts of an SPS measure under Anne x A(1), namely its form and 
nature: 
"The form element is referred to in  the second paragraph of Annex A(1) 
('laws, decrees, regulations').  Finally , the nature of measures qualifying as 
SPS measures is also addressed in th e second paragraph of Annex A(1) 
('requirements and procedures, including, inter alia , end product criteria;  processes 
and production methods;  testing, inspecti on, certification and approval procedures;  
[etc.]')."1213 
7.144  This Panel considers that the second paragra ph of Annex A(1) sets out elements of the 
definition of SPS measures by providing examples.  In fact, the second paragraph starts with the 
words "Sanitary and phytosanitary measures incl ude".  Thus, the items spelt out in the second 
paragraph do not form a closed list.  This is quite different from the closed list of possible purposes of 
a covered SPS measure under the first paragr aph of Annex A(1), in particular its 
subparagraphs (a)-(d). 
7.145  Further, the Panel does not consider that th e list of examples in the second paragraph of 
Annex A(1) provides a clear-cut division between th e elements of form and nature, the first three 
items ("laws, decrees, regulations") corresponding to  the form, and the latter two ("requirements and 
procedures") to the nature of SPS measures.  Given the placing of the word "and" between the fourth 
and fifth items, the ordinary way to read "laws, d ecrees, regulations, requirements and procedures" is 
as an enumeration of five items, with the words "all relevant" qualifying each one of them. 
7.146  This is underscored by the Spanish and French versions of the SPS Agreement.  One basic 
principle of treaty interpretation is that "[t]he terms of the treaty are presumed to have the same 
meaning in each authentic text"1214, and that the treaty interpreter should aim at "the meaning which 
best reconciles the texts [in the different authentic language versions], having regard to the object and 
purpose of the treaty."1215  The SPS Agreement has three language versions, in English, French and 
Spanish, each equally authentic.1216 
7.147  The Spanish version of the second para graph of Annex A(1) refers to " todas las leyes, 
decretos, reglamentos, prescripcion es y procedimientos pertinentes ", placing the " y" before the fifth 
item of the enumeration, and embraci ng the five items between the words " todas " and " pertinentes " 
("all relevant" in English).  The French version mentions " toutes lois, tous décrets, toutes 
réglementations, toutes prescriptions  et toutes procédures pertinents ", again with the word " et" 
appearing before the fifth item.  Further, the Fren ch version makes it evident that both the words in 
the phrase "all relevant" at the beginni ng of the enumeration in the Eng lish version should be read as 
relating to all five items of the list.  In fact, the French version repeats the word " tou[te]s " before each 
                                                      
1213 Panel Report on EC – Approval and Marketing of Biotech Products , para. 7.149.  See also, Panel 
Report on EC – Approval and Marketing of Biotech Products , para. 7.1334;  Panel Report on Canada – 
Continued Suspension , para. 7.420;  and Panel Report on US – Continued Suspension , para. 7.429. 
1214 The Vienna Convention on the Law of Treaties  (the " Vienna Convention "), done at Vienna, 23 May 
1969, 1155 U.N.T.S 331;  8 International Legal Materials 679, Article 33.3. 
1215 Vienna Convention,  Article 33.4. 
1216 See the Marrakesh Agreement Establishing the World Trade Organization, Article II:2 and 
testimonium. WT/DS367/R 
Page 232  
 
 of the five items.  Further, it uses the adjective " pertinents " in the masculine, indicating that it cannot 
relate only to the immediately preceding noun " procédures ", nor to the two preceding nouns 
("prescriptions " and " réglementations ").  These three nouns (" procédures ", "prescriptions " and 
"réglementations "), as well as the first noun of the list (" lois"), are feminine, so " pertinents " in the 
masculine has to refer to all five items of list, including but not limited to the only masculine noun:  
"décrets ".  It is a basic principle of  the French language that the adjective relating to a list of both 
feminine and masculine nouns takes the masculine form. 
7.148  In the light of the above, the three authentic language versions of the last paragraph of 
Annex A(1) are interpreted most harmoniously if the terms "laws, decrees, regulations, requirements and procedures" are perceived as a list of five items  of equal quality and importance, with the words 
"all" and "relevant" referring to each of these items. 
7.149  The Japan – Agricultural Products II  panel also read together the list in the last paragraph of 
Annex A(1) by holding that "[p]aragraph 1 of Annex A to the SPS Agreement makes clear that 'phytosanitary measures include all relevant laws, decrees, regulations, requirements and 
procedures'."
1217  This lends further support to reading the list as an enumeration of five items that 
exemplify the type of instrument s which may include SPS measures. 
7.150  Since this Panel reads "all relevant laws, decr ees, regulations, requirements and procedures" 
as a list of five items, it disagrees with the EC – Approval and Marketing of Biotech Products panel 
that the examples following this list in Annex A(1) would relate only to the last two items of the list 
("requirements and procedures").  The Panel is aw are that some of the ex amples repeat the words 
"requirements" and "procedures".  But not all do.  Laws, decrees and regulations may typically set out 
requirements and procedures, so the examples including the words "requirements" and "procedures" 
can be read as also qualifying "laws, decrees, regulations". 
7.151  In fact, the Panel is convinced that the me asures exemplified in the second paragraph of 
Annex A(1) serve to illustrate what can be considered as " relevant  laws, decrees, regulations, 
requirements and procedures" containing SPS measur es (emphasis added).  The second paragraph of 
Annex A(1) not only mentions "all relevant" instru ments broadly;  it includes also a non-exhaustive 
list of measures that can be considered as "relev ant" examples for defining SPS measures.  The Panel, 
again, finds support for this in the French and Spanis h versions of the definition.  The French version 
starts the examples after the word " pertinents ".  The Spanish version does likewise;  in addition, it 
includes a colon before the examples, thus creating a structure with a list of five items on the one hand 
(form), and a list of examples (nature), on the other hand. 
7.152  While distinct, these two parts of the last para graph of Annex A(1) are closely related.  
In fact, the EC – Approval and Marketing of Biotech Products panel read "all relevant laws, decrees, 
regulations" in Annex A(1) as "suggest[ing] that the SPS Agreement does not prescribe a particular 
legal form and that SPS measures may in principle take many different legal forms."1218  Including 
"requirements and procedures" into the form elem ent of measures falling under Annex A(1) further 
broadens that element.  As a result, whether the instrument can be consider ed "relevant" becomes a 
more important aspect of the form element for th e interpreter than the actual legal form of the 
instrument.  The obvious way for the interprete r to assess which "laws, decrees, regulations, 
requirements and procedures" are "relevant" is by having recourse to the examples in the second part 
of the same sentence, that is the nature element.  Importantly, the nature element is broad.  It is 
introduced with the words "including, inter alia ", indicating, as the EC – Approval and Marketing of 
                                                      
1217 Panel Report on Japan – Agricultural Products II , para. 8.111. 
1218 Panel Report on EC – Approval and Marketing of Biotech Products , para. 7.1334.  WT/DS367/R 
 Page 233 
 
 
 Biotech Products panel put it, "by way of example, a numbe r of relevant substantive requirements ... 
and procedures"1219 that define the nature of a covered SPS measure. 
7.153  In sum, the form and nature elements in th e definition of SPS measures in Annex A(1) are 
both broad, and they are closely connected to each other.  Accordingly, the Panel will now analyse 
whether the 16 measures fit the elements of form and nature spelt out in the second paragraph of 
Annex A(1).  Given the linkage of form and natu re under that paragraph, the Panel will assess these 
two elements together to analyse whether the 16 measures can qualify as SPS measures. 
7.154  There is no disagreement between the parti es that the document that spells out the 
16 measures at issue in this dispute is the IRA.  Th e IRA is an integral part of what Australia defines 
in Biosecurity Australia Policy Memorandum 2007/07 , referenced in New Zealand's panel request1220, 
as Australia's "policy for the importation of apples from New Zealand".1221 
7.155  Biosecurity Australia Policy Memorandum 2007/07  specifies that this policy "has [been] 
determined"1222 by "Australia's Director of Quarantine"1223, and it defines this policy in the following 
way:  "Importation of apples can be permitted subject  to the Quarantine Act 1 908, and the application 
of phytosanitary measures as specified in the Fi nal import risk analysis report for apples from 
New Zealand, November 2006."1224 
7.156  As to the application of the policy, Biosecurity Australia Policy Memorandum 2007/07  states 
that "[t]he policy will now be taken into account  by decision makers when considering import 
applications for apples from New Zealand in accordance with the Quarantine Act 1908 and 
Quarantine Proclamation 1998 as amended."1225  This shows the official intention to systematically 
enforce this policy for apple imports  into Australia from New Zealand. 
7.157  The above also demonstrates that Australia 's policy for the importation of apples from 
New Zealand, including the IRA, wa s adopted in an official manner,  within the framework, and on the 
basis of, established legal instruments.  In particul ar, the IRA was issued by the "Chief Executive of 
Biosecurity Australia"1226, a "part of the Commonwealth Depart ment of Agriculture, Fisheries and 
Forestry – Australia"1227, and under the seal of the Australian Government.1228  Also, there was a 
possibility of lodging an appeal against the IRA with  the Import Risk Analysis Appeals Panel within 
the same Australian Government Department.1229 
7.158  All these characteristics accord a significant degree of legal formality to the IRA and liken it 
to a "regulation" under Annex A(1), even if the IRA is not formally termed as such and even though it only "recommends" measures.
1230  Through Biosecurity Australia Policy Memorandum 2007/7 , 
and by virtue of the more general legal framewor k referenced in the IRA, the measures recommended 
by the IRA have become part of Australia's a pplicable and enforceable legal "policy for the 
                                                      
1219 Panel Report on EC – Approval and Marketing of Biotech Products , para. 7.1334. 
1220 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A-1 to this report, p. 1, footnote 1. 
1221 Biosecurity Australia Policy Memorandum 2007/07 , in Exhibit NZ-2. 
1222 Ibid. 
1223 Ibid. 
1224 Ibid. 
1225 Ibid. 
1226 Australia's IRA, Part B, p. iii. 
1227 Import Risk Analysis Handbook  (2003), in Exhibit AUS-10, p. 6. 
1228 Australia's IRA, coverpage. 
1229 Australia's IRA, Part B, p. iii. 
1230 Australia's IRA, Part A, p. 1.;  and Part B, p. 313;  Australia's first written submission, para. 146;  
and Australia's reply to Panel question 15 after the first substantive meeting. WT/DS367/R 
Page 234  
 
 importation of apples from New Zealand".
1231  Nor is the legal status of these measures any weaker as 
a result of the need for the Parties to jointly de velop standard operating procedures setting out specific 
aspects of some of the 16 measures. 
7.159  In any event, even if the IRA and the 16 measu res spelt out therein should not be considered 
"regulations", they qualify as "requirements and proc edures".  The IRA itself frequently refers to the 
measures using one or the other of these terms.1232 
7.160  The dictionary definition of the word "require ment" is "something called for or demanded;  
a condition which must be complied with."1233  Part A of the IRA introduces a summary of the 
measures set out in the IRA using the word "cond ition":  "This final report recommends that the 
importation of apples to Australia from New Zeala nd be permitted, subject to the following risk 
management conditions ..."1234 
7.161  Further, as argued by New Zealand, each of the 16 measures requires New Zealand or its 
apple producers, packing houses and traders to do so mething as a condition for New Zealand apples to 
have access to the Australian market.1235  As New Zealand explains, even Measure 15, which 
ostensibly addresses the involvement of AQIS offi cials, creates a burden for New Zealand and a 
requirement for it to do something.1236  New Zealand needs to comply with each of the measures in 
order to export apples to Australia. 
7.162  In turn "procedure" is defined by the dictiona ry as "[t]he fact or manner of proceeding;  a 
system of proceeding;  conduct, behaviour"1237 and as "a particular m ode or course of action, a 
proceeding."1238  Further similar definitions of "procedure" include "[a] particular course or mode of 
action;  an established or prescribed way of doing so mething;  (also) an instance of this;  a process, a 
proceeding"1239 and "[t]he fact or manner of proceeding w ith any action, or in any circumstance or 
                                                      
1231 Biosecurity Australia Policy Memorandum 2007/07 , in Exhibit NZ-2. 
1232 Australia's IRA, Part B, p. 106 ("[r]equirements" );  p. 114 ("the requireme nt for inspection", "the 
requirement for disinfection treatment");  pp. 151-154 (" requirements");  p. 192 ("required", "risk management 
and operational procedures");  p. 313 ("quarantine conditions (risk management measures together with 
phytosanitary procedures) and operational procedures  required to manage the quarantine risks");  
p. 314 ("[r]equirement for pre-clearance", "area freed om and accreditation requirements", "packing house 
procedures", "registration procedures");  p. 315 ("requ irements for freedom from specified disease symptoms 
and anthropods");  p. 316 ("procedure", "required overall efficacy", "requirements", "[ g]eneral requirements");  
p. 317 ("Biosecurity Australia requires that …", "chlorine or approved alternative dip requirements", 
"the necessary requirements, … includi ng measures to prevent contaminati on of fruit and packaging materials 
with quarantine pests");  p. 318 ("[d]isinfection treatment of apples in the packing house is a mandatory requirement", "required level", "must be monitored and adjusted as required", "operational procedures"), 
"procedures … to prevent the contamination of  apples after the disinfection treatment", 
"inspection procedures"),  p. 320 ("requirements", "the orchard monitoring requirements for freedom of symptoms of fire blight and European canker", "the chlorine dip requirements");  p. 321 ("requires mandatory 
treatment", "the orchard monitoring requirements for freedom of symptoms of fire blight and European canker", 
"the chlorine dip requirements");  pp. 319, 320 and 322 ("procedures");  p. 325 ("operational procedures", "import requirements"). 
1233 The New Shorter Oxford English Dictionary , Ed. Brown, L., Clarendon Press, Oxford, Vol. 2, 
p. 2557. 
1234 Australia's IRA, Part A, p. 1.  See also Australia's IRA, Part B, p. 313. 
1235 New Zealand's reply to Panel question 19 afte r the second substantive meeting, para. 33. 
1236 New Zealand's first writte n submission, para. 4.535. 
1237 The New Shorter Oxford English Dictionary , Ed. Brown, L., Clarendon Press, Oxford, Vol. 2, 
p. 2363. 
1238 The New Shorter Oxford English Dictionary , Ed. Brown, L., Clarendon Press, Oxford, Vol. 2, 
p. 2363. 
1239 The Oxford English Dictionary online, <http://www.oed.com>.  WT/DS367/R 
 Page 235 
 
 
 situation;  the performance of pa rticular actions, esp. considered in regard to method;  practice, 
conduct.  Also:  the established or prescribed way of doing something."1240 
7.163  Clearly, each of the 16 measures sets out a speci fic procedure within the meaning of these 
definitions:  each of them prescribes a particular wa y of doing something, which needs to be followed 
if New Zealand apples are to be imported into Australia. 
7.164  The Panel now turns to the last part of th e second paragraph of Annex A(1), which provides 
that the term "all relevant laws, decrees, regulations, requirements and procedures": 
"[I]nclud[es], inter alia , end product criteria;  pr ocesses and production methods;  
testing, inspection, certification and a pproval procedures;  quarantine treatments 
including relevant requirements associated w ith the transport of animals or plants, or 
with the materials necessary for their su rvival during transport;  provisions on 
relevant statistical methods, sampling pr ocedures and methods of risk assessment;  
and packaging and labelling requirements directly related to food safety." 
7.165  Of these examples, "quarantine treatment" would seem particularly relevant in the light of the 
following part of Biosecurity Australia Policy Memorandum 2007/07 : 
"Biosecurity Australia recommended that Australia's Director of Animal and Plant 
Quarantine  make a policy determination that apples from New Zealand should be 
permitted entry into Australia under specific quarantine conditions . 
The Director of Animal and Plant Quar antine has now determined the policy to 
permit the entry of apples from New Zealand to Australia.  Importation of apples can 
be permitted subject to the Quarantine Act 1908 , and the application of phytosanitary 
measures as specified in the Final import risk analysis report for apples from 
New Zealand , November 2006.  These measures are designed to limit quarantine risk  
to a level which is acceptably low, consistent with Australia's conservative approach 
to quarantine ."1241 
7.166  Also, the IRA refers to "quarantine pests"1242 and to "quarantine protection"1243, as well as to 
the "[m]anagement of quarantine risks"1244 and specifically to "quarantine measures".1245  T h e  I R A  
also uses the word "treatment" to refer to some of the measures set out therein.1246  Further, it makes 
reference to "quarantine conditions (risk mana gement measures together with phytosanitary 
procedures) and operational procedures requi red to manage the quarantine risks."1247  In addition, the 
IRA refers collectively to the risk management measures set out therein as "quarantine conditions"1248 
and specifically as "quarantine treatments".1249 
7.167  The Panel notes in this context the remarks by the Australia – Salmon panel on the word 
"quarantine":  "[w]ithout defining the word 'quarantin e' as it is used in the SPS Agreement, [the panel 
considers] that the concept of 'quarantine' more  generally is commonly un derstood to relate to 
                                                      
1240 The Oxford English Dictionary online, <http://www.oed.com>. 
1241 Biosecurity Australia Policy Memorandum 2007/07 , p. 1 (emphasis added). 
1242 Australia's IRA, Part A, pp. 1, 3, 13 and 14. 
1243 Australia's IRA, Part A, p. 7. 
1244 Australia's IRA, Part A, p. 15. 
1245 Australia's IRA, Part A, pp. 7 and 17. 
1246 Australia's IRA, Part A, pp. 1, 5, 9, 15 and 18. 
1247 Australia's IRA, Part B, p. 313. 
1248 Ibid. 
1249 Australia's IRA, Part B, p. 41. WT/DS367/R 
Page 236  
 
 avoiding the spread of pests or diseases (in the sen se of the definition of a 'sanitary measure' in 
paragraph 1(a))."
1250  Each of the 16 measures at issue in this dispute has a purpose falling under 
subparagraph (a) of Annex A(1) because each of them relates to avoiding the spread of pests, which 
the Australia – Salmon panel linked to the word "quarantine". 
7.168  In addition, other examples mentioned in the last  sentence of paragraph 1 of Annex A, such as 
"end product criteria", "processes and production met hods" "inspection... and approval procedures", 
would also seem particularly relevant – at least for some of the 16 measures. 
7.169  In any event, as indicated above, the list of examples contained in the final part of 
Annex A(1) is not exhaustive:  it is introduced with the words "including, inter alia ".  Further, as 
emphasized above, the whole second paragraph of the definition of  SPS measures under Annex A(1) 
is introduced with the words "Sanita ry or phytosanitary measures include ..."  Therefore, even if the 16 
measures at issue should not correspond precisely to  the form and nature element of the second 
paragraph of Annex A(1), they can constitute SPS measu res to the extent that they ostensibly promote 
at least one of the purposes spelt in subparagraphs  (a)-(d) of the first paragraph of Annex A(1). 
7.170  In the light of the above, the Panel finds that each of the 16 measures is an SPS measure 
under Annex A(1) of the SPS Agreement.  In this regard, the Panel notes the following arguments by 
New Zealand: 
"The IRA states that the import risk analysis  'conforms with Australia's obligations as 
a WTO member country' and that 'these rights and obligations derive principally from the WTO's SPS Agreement '.
1251 
... 
The draft IRA was notified to the SPS Committee on 16 December 2005 
(G/SPS/N/AUS/122/Add.3), as were previous drafts of the IRA. 
The letter by AQIS to NZMAF formally notifying New Zealand that it had initiated 
an import risk assessment on apples refers to  a process for 'establishing phytosanitary 
measures' in respect of New Zealand apples.1252"1253 
7.171  In fact, the IRA refers to "sanitary and phytosanitary measures"1254 and to "phytosanitary 
measures"1255 to collectively denote the measures it lays down.  In turn, the IRA defines 
"[p]hytosanitary measure" as "[a]ny legislation, regul ation or official procedure having the purpose to 
prevent the introduction and/or spread of quarantin e pests, or to limit the economic impact of 
regulated nonquarantine pests (ISPM 5)".1256  Defined in this way, the "phytosanitary measures" set 
out in the IRA undoubtedly fall under the defin ition of SPS measures in Annex A(1) of the 
SPS Agreement. 
7.172  In the light of the foregoing, the Panel concl udes that the 16 measures at issue, both as a 
whole and individually, constitute SPS measures within the meaning of Annex A(1).  These 
SPS measures also have an actual or potential trade effect, which means that they fall under the scope 
of the SPS Agreement. 
                                                      
1250 Panel Report on Australia – Salmon , para. 8.36. 
1251 (footnote original ) IRA, Part B, page 3. 
1252 (footnote original )Exhibit NZ-104. 
1253 New Zealand's reply to Panel question 13 af ter the first substantive meeting, para. 25. 
1254 Australia's IRA, Part B, pp. 4 and 5. 
1255 Australia's IRA, Part B, pp. 5, 40 and 337. 
1256 Australia's IRA, Part B, p. 344.  WT/DS367/R 
 Page 237 
 
 
 (c) Principal v. ancillary measures 
7.173  Finally, the Panel looks at the distinction between ancillary and principal measures.  
Australia advances the notion of a distinction to support its argument that many of the 16 measures 
cannot be reviewed under the SPS Agreement individua lly, but only in combination with certain other 
measures, which are supposedly principal measures. 
7.174  The Panel does not see the relevance or validity of  this distinction for defining SPS measures 
under Annex A(1) of the SPS Agreement.  Austra lia acknowledges that Annex A(1) is key for 
defining whether the 16 measures at issue qualify as SPS measures.  Australia accepts also that 
Annex (A)1 does not mention any distincti on between principal and ancillary measures.1257  The Panel 
agrees. 
7.175  Australia effectively asks the Panel to carve out ancillary measures from the definition of 
SPS measures, and to limit their review under th e SPS Agreement to a joint review with other 
measures.  But Annex A(1) does not refer to anc illary measures or spell out any such carve-out.  
The criteria advanced by Australia  for assessing whether the 16 measures are ancillary have not been 
identified specifically in previous rulings by pane ls or the Appellate Body  on Annex A(1) of the 
SPS Agreement. 
7.176  Australia argues that the definition of SPS meas ures in subparagraph (a) of Annex A(1) of the 
SPS Agreement, in particular the phrase "applied:  to protect" against particular categories of SPS 
risks, should guide the Panel in identifying "princ ipal measures", which may be reviewed individually 
under the SPS Agreement.1258  The Panel has already found, however, that each of the 16 measures 
under review, including the ones that Australia identif ies as "ancillary" measures, fulfills on its own 
subparagraph (a).1259 
7.177  Australia also invokes the US – Export Restraints  dispute as a basis for distinguishing 
ancillary measures from principal ones that "constitute an instrument with a functional life of [their] 
own" because they " do something concrete".1260  That dispute, however, concerned the 
SCM Agreement;  it did not involve the SPS Agreement or even alleged SPS measures.  In particular, 
that dispute did not interpret the definition of Annex A(1) of the SPS Agreement. 
7.178  US – Export Restraints  took place in a different context from this dispute.  The US – Export 
Restraints panel was assessing whether instruments acco mpanying and interpreting related but 
formally distinct instruments, as well as the "p ractice" under such instruments could "give rise 
independently to a violation of WTO obligations."1261  Conversely, this Panel needs to assess whether 
each of the 16 measures spelt out in  the same instrument, the IRA, is an SPS measure in its own right.  
Further, this Panel does not look at the prac tice implementing the IRA.  New Zealand has not 
challenged such practice in this dispute. 
7.179  Even applying the criteria laid down by the US – Export Restraints  panel to the 16 measures 
at issue in this dispute could not result in findi ng that some of those individual measures do not 
constitute an instrument with a functional life of their own.  In fact, it is clear that each of the 
16 measures "do[es] something concrete".  As anal ysed above, each of the 16 measures establishes a 
requirement for specific action to be followed by New Zealand if it intends to export apples into 
Australia.  Importantly, whether the various instruments at issue in US – Export Restraints  amounted 
                                                      
1257 Australia's reply to Panel question 23 after the first substantive meeting. 
1258 Australia's reply to Panel question 14 after the first substantive meeting. 
1259 See paras. 7.130 to 7.141 above. 
1260 Panel Report on US – Export Restraints,  para. 8.85 (original emphasis). 
1261 Ibid.  See also, Panel Report on US – Export Restraints,  paras. 2.1-2.11. WT/DS367/R 
Page 238  
 
 to a "requirement"
1262 or "require[d] any particular treatment"1263 was a key criterion for that panel to 
assess whether the instruments in ques tion "d[id] something concrete". 
7.180  The Panel notes, as New Zealand also recognizes, that some of the 16 measures are related to 
each other.  For instance, Measures 1-5 are all concerne d with fire blight symptoms in apple orchards.  
Clearly, these measures support each other.  In partic ular, some are explicitly adopted to make sure 
that compliance with another measure is not jeopardiz ed, circumvented or otherwise made ineffective. 
7.181  Unlike US – Export Restraints , however, the relationship betw een the alleged principal and 
ancillary measures in the current dispute is not a merely interpretive one.  As New Zealand points out, 
each of the 16 measures, including Measures 1-5, sets out a distinct and specific requirement for New Zealand to do something, with a distinct burden specific to compliance with each measure.
1264  
Also, each measure may be enforced  separately in time.  And, as Australia acknowledges, lack of 
compliance with any of the 16 measures might l ead to the suspension of apple imports from 
New Zealand.1265 
7.182  Neither Annex A(1) of the SPS Agreement, nor US – Export Restraints  use the terms 
"ancillary" and "principal" measures.  Australia coined these terms, allegedly based on various 
ISPMs.1266  Australia refers in particular to th e definitions of "phytosanitary measure", 
"phytosanitary action" and "phyto sanitary procedure" in ISPM No . 5.  According to Australia, 
"[w]hile the phytosanitary measure has the purpose to  'prevent' or 'limit', the phytosanitary action and 
phytosanitary procedure simply implement  the phytosanitary measure ;  inspections, tests and 
surveillance do not 'prevent' or 'limit' the impact  of quarantine pests unless there are consequences 
attached to their results."1267  The Panel notes that the SPS Agreement contains no such distinction 
between phytosanitary measures, actions and procedur es.  Also, some of the actions and procedures 
included as examples in the ISPM definitions invoked by Australia, e.g. inspection, testing, quarantine 
treatments, also appear as examples in the defin ition of an SPS measure contained in Annex A(1).  
Further, the Panel notes that the experts have gi ven diverging responses on which of the 16 measures 
might qualify as ancillary and principal in the light  of the SPS Agreement and the ISPM definitions 
referenced by Australia.1268 
7.183  Australia also argues that its IRA follows a "s ystems approach".  The IRA refers to ISPM 
No. 14 on the use of integrated measures in a systems approach for pest risk management1269, and it 
defines systems approach as follows: 
"For some pests, the analysis may indicat e that there is no single risk management 
measure that will reduce the risk to 'very low' or 'negligible'.  In these cases, it may be 
possible to combine individual risk mana gement measures to achieve a sufficient 
                                                      
1262 Panel Report on US – Export Restraints,  para. 8. 116. 
1263 Panel Report on US – Export Restraints,  para. 8.129. 
1264 New Zealand's reply to Panel question 19 afte r the second substantive meeting, para. 33. 
1265 See, for example, Australia's reply to Panel question 16 after the first substantive meeting. 
1266 Australia's first written submission, Annex 2. 
1267 Australia's reply to Panel question 24 after the first substantive meeting. 
1268 Dr Deckers's, Dr Paulin's and Dr Schrader's replies to Panel question 48, Dr Deckers's, Dr Latorre's 
and Dr Swinburne's replies to Panel question 93, Dr Latorr e's, Dr  Schrader's and Dr Sgrillo's replies to Panel 
question 139, Dr Latorre's, Dr  Sc hrader's and Dr Sgrillo's replies to  Panel question 140, Dr Deckers's, 
Dr Latorre's, Dr Schrader's and Dr Sgr illo's replies to Panel question 141, in List of Replies from the scientific 
experts to questions posed by the Panel, paras. 300-303, 528-529 and 814-834. 
1269 Australia's first written submission, para. 118.  WT/DS367/R 
 Page 239 
 
 
 level of risk reduction.  This is referre d to as a 'systems' approach to risk 
management."1270 
In addition, ISPM No. 5 defines systems approach (es) as "[t]he integration of different risk 
management measures, at least two of which act independently, and which cumulatively achieve the 
appropriate level of protection against regulated pests." 
7.184  The Japan – Apples (Article 21.5 – US) panel reviewed the various requirements at issue in 
that dispute as one single SPS measure taken to comp ly.  One of its main reasons for doing this was 
that the original Japan – Apples panel did the same "essentially because all the requirements were 
presented as part of a systemic approach."1271 
7.185  However, the panels in Japan – Apples and Japan – Apples (Article 21.5 – US) reviewed one 
pest, whereas the 16 measures in the cu rrent dispute relate to three differe nt pests.  Further, only in the 
context of fire blight does the IRA link some of the 16 measures at issue by referring explicitly to a "systems approach".
1272  When consulted by the Panel, Australia explicitly uses the expression 
"systems approach" only in regard to the fi re blight measures contested by New Zealand.1273  In fact, 
Australia refers to Measures 1-2 and 5-6 arguing th at "[it] has adopted a 'systems approach' with 
respect to managing the risks associated with fire blight".1274  Referring to Measures 3-4 and 7-8, 
Australia adds that "[t]he Final IRA Report also  recommends a number of ancillary procedures to 
support, verify and operationalise this systems approach."1275  Finally, Australia explicitly rejected the 
relevance of a "systems approach" argument for grouping alleged principal and ancillary measures 
relating to European canker and to ALCM.1276  This makes it difficult for the Panel to review all of the 
16 measures at issue under the logic of Australia's "systems approach" argument. 
7.186  Even if the Panel chose to group some or all of the 16 measures together as one single SPS 
measure for the purposes of its analysis, it would not be prevented from finding that a specific 
element of that single measure, including what Au stralia qualifies as ancillary measures, violates the 
SPS Agreement.  The Japan – Apples panel reserved that right even though it reviewed the 
requirements at issue as one single phytosanitary me asure:  "We may of course conclude that one 
aspect of a measure is illegal and not others, even when the complainant argu es that the measure as a 
whole is illegal.  Indeed, since the SPS Agreement establishes different rights and obligations, it may 
be also appropriate, depending on the provision at issue, to consider the specific requirements 
individually."1277  The Japan – Apples (Article 21.5 – US) panel did the same.1278 
7.187  In the light of the foregoing, this Panel reject s Australia's arguments that New Zealand has not 
demonstrated that each of the 16 measures, both as a whole and individually, amounts to an 
SPS measure covered by the SPS Agreement.  A ccordingly, the Panel will assess whether the 
16 measures at issue, as a whole or individually, are inconsistent with the relevant provisions of the 
SPS Agreement.  At the same time, the Panel rese rves the right to assess various related measures 
jointly under specific provisions of the SPS Agreement.  In fact, in its "[r]eview of each element of 
the compliance measure"1279 as one single SPS measure under Article 2.2 of the SPS Agreement, 
                                                      
1270 Australia's IRA, Part A, p. 9.  See also Australia's first written submission, para. 118. 
1271 Panel Report on Japan – Apples (Article 21.5 – US) , para. 8.29. 
1272 Australia's IRA, Part B, pp. 73, 106, 110, 111 and 112. 
1273 Australia's reply to Panel question 15 after the first substantive meeting. 
1274 Australia's first written submission, para. 139.  See also, Ibid., paras. 140, 929 and 936. 
1275 Australia's first written submission, para. 140. 
1276 Australia's comments on the experts replies to questions, para. 303. 
1277 Panel Report on Japan – Apples , para. 8.19.  See also, Panel Report on Japan – Apples 
(Article 21.5 – US) , paras. 8.29-8.30. 
1278 Panel Report on Japan – Apples (Article 21.5 – US) , para. 8.30. 
1279 Panel Report on Japan – Apples (Article  21.5 – US) , p. 108, DSR 2005:XVI, 7911, at 8051. WT/DS367/R 
Page 240  
 
 the Japan – Apples (Article 21.5 – US)  panel grouped specific elements of the same measure together 
because "they relate[d] to different aspects of the same concern"
1280 and because "many elements of 
the ... measure are interrelated and justified on the basis of the same scientific evidence."1281 
C. NEW ZEALAND 'S CLAIMS UNDER ARTICLES 2.2, 5.1 AND 5.2 OF THE SPS A GREEMENT  
1. Order of analysis 
(a) Summary of the Parties' arguments 
7.188  New Zealand argues that Australia's measures for the importation of New Zealand apples are 
inconsistent with Australia's obligatio ns under Article 2.2 of the SPS Agreement.1282  There is no 
rational or objective relationship between, on the one  hand, the scientific evidence and, on the other 
hand, the Australian measures relating to fire blight , European canker and apple leafcurling midge, as 
well as the general measures imposed by Austra lia for the importation of New Zealand apples.1283  
Australia imposes these measures in the absence of scientific evidence or in the face of scientific 
evidence to the contrary.1284 
7.189  New Zealand states that Articles 5.1 and 2.2 of the SPS Agreement are closely related1285 and 
notes that, according to the panels and the Appellate Body in the EC – Hormones  dispute, Article 5.1 
of the SPS Agreement may be viewed as a speci fic application of the basic obligations in 
Article 2.2.1286  New Zealand argues that "[w]hile not ev ery violation of Article 2.2 will necessarily 
entail a violation of Article 5.11287, Australia's breach of Article 2.2 in this case indicates that it is 
likely not to be in compliance with Article 5.1."1288 
7.190  New Zealand notes that Article 5.1 contains two elements:  (a) there must be a risk 
assessment, within the meaning of Article 5.1 and paragraph 4 of Annex A;  and, (b)  the SPS 
measures must be based on that risk assessment.1289  New Zealand argues that "Australia's IRA is not 
a risk assessment within the meaning of Ar ticle 5.1 and paragraph 4 of Annex A".1290  In 
New Zealand's view, Australia has not properly ev aluated the likelihood of entry, establishment or 
spread of the three relevant pests, nor has it ev aluated that likelihood according to the SPS measures 
which might be applied.1291  To the extent that a proper risk assessment does not exist to support 
                                                      
1280 Panel Report on Japan – Apples (Article  21.5 – US) , para. 8.76. 
1281 Panel Report on Japan – Apples (Article  21.5 – US) , para. 8.29. 
1282 New Zealand's first writte n submission, para. 1.2. 
1283 New Zealand's first written submission, paras. 1.3- 1.6, 4.31, 4.51, 4.54, 4.97, 4.105, 4.139-4.140, 
4.144, 4.150.  See also, New Zealand's seco nd written submission, paras.  2.99-2.292. 
1284 New Zealand's first writte n submission, para. 4.6. 
1285 New Zealand's second written submission, paras. 1.5 and 2.93. 
1286 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 36, referring to Appellate Body Report on EC – Hormones , para. 180.  See also, Panel Report on EC – 
Hormones (Canada) , para. 8.96;  Panel Report on EC – Hormones (US) , para. 8.93. 
1287 (footnote original ) Panel Report, Australia – Salmon , para. 8.52. 
1288 New Zealand's first writte n submission, para. 4.152. 
1289 New Zealand's first writte n submission, para. 4.153. 
1290 New Zealand's first wr itten submission, para. 4.158.  S ee also, New Zealand's first written 
submission, para. 4.153. 
1291 New Zealand's first written submission, paras. 1.8, 4.158 and 4.403-4.404.  See also, 
New Zealand's first written submission, paras. 4.160, 4.204 -4.206, 4.207, 4.265, 4.333, 4.378, 4.383 and 4.402;  
and, New Zealand's second written submission, paras. 2.293-2.803.  WT/DS367/R 
 Page 241 
 
 
 Australia's measures, even if New Zealand has not made separate arguments under the "based on" 
requirement, those measures cannot be said to  be "based on" such a risk assessment.1292 
7.191  New Zealand argues further that Australia's measures are inconsistent with Article 5.2 of the 
SPS Agreement.  Australia's IRA failed to give genuine consideration to the relevant scientific 
evidence;  to the relevant processes and production me thods;  to the relevant inspection, sampling and 
testing methods;  to the prevalence of the relevant di seases or pests;  and to the relevant environmental 
conditions.1293 
7.192  New Zealand submits that, "because [Australia's] measures are not based on a risk 
assessment, the measures are [consequentially] also in  breach of the requirements of Article 2.2 [of 
the SPS Agreement] that measures be 'based on scien tific principles' and not be 'maintained without 
sufficient scientific evidence'."1294 
7.193  New Zealand rejects the order of analysis pr oposed by Australia for disputes that have 
simultaneous claims under Articles 2.2 and 5.1.  Ne w Zealand disagrees with Australia's view that 
"the question of whether Australia has mainta ined measures 'without scientific evidence' under 
Article 2.2 can only be answered  by considering whether Australia's measures are based on a valid 
risk assessment under Article 5.1".1295  New Zealand submits that "[t]here is nothing in the text of the 
SPS Agreement that suggests that an analysis of Ar ticle 5.1 should logically precede an analysis of 
Article 2.2, much less that it must do so in every instance".1296  Instead, as the Appellate Body held in 
EC – Hormones , an approach starting with the "Basic Rights and Obligations" in Article 2 is 
"logically attractive".1297  Australia's view is an attempt to lim it the scope of Article 2.2 "in favour" of 
Article 5.1.  According to Australia, a risk assess ment conducted by a competent authority should be 
afforded "considerable deference".  If that were co rrect, it would follow that the Panel would have no 
mandate to assess whether there is a "rational or objective" relationship between the science and the 
SPS measures.1298  Hence, in the circumstances of this case, it would be appropriate for the Panel to 
start its examination with Article 2.2.1299 
7.194  In response to arguments made by Australia, New Zealand disagrees with the view that 
consistency of an SPS measure with Article 5. 1 of the SPS Agreement necessarily establishes 
                                                      
1292 New Zealand's first written subm ission, para. 4.153.  See also , New Zealand's reply to Panel 
question 117 after the first substantive meeting, para . 257;  and, New Zealand's second written submission, 
para. 2.794;  New Zealand's reply to Panel questions 6, 27, 50 and 117 after the second substantive meeting, 
paras. 14, 43, 94 and 187-188. 
1293 New Zealand's first written submission, paras.  1.11, 1.12, 4.411-4.428;  New Zealand's opening 
oral statement at the first substantive meeting of the Panel with the Parties, paras. 113-114.  See also, 
New Zealand's reply to Panel question 121 after the firs t substantive meeting, paras. 259-265;  New Zealand's 
second written submission, paras. 2.804 and 2.816;  Ne w Zealand's opening oral statement at the second 
substantive meeting of the Panel with the Parties, para . 110;  New Zealand's reply to Panel question 116 after 
the second substantive meeting, paras. 182-186;  and New Zealand's comments on Australia's reply to Panel 
question 116 after the second substantive meeting, para. 269. 
1294 New Zealand's first writte n submission, para. 4.405. 
1295 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 35 (original emphasis).  See also, Australia's first written submission, para. 344. 
1296 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 36 (original emphasis).  S ee also, New Zealand's second wr itten submission, para. 2.97, and 
New Zealand's opening oral statement at the second substa ntive meeting of the Panel with the Parties, para. 38. 
1297 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 36, referring to Appellate Body Report on EC – Hormones , para. 250. 
1298 New Zealand's opening statement at the first substantive meeting of the Panel with the Parties, 
paras. 38-40.  See also, New Zealand's closing statement at the first substantive meeting of the Panel with the 
Parties, para. 5, and New Zealand's second written submission, paras. 1.5, 2.85, 2.96 and 2.100. 
1299 New Zealand's second writte n submission, para. 2.98. WT/DS367/R 
Page 242  
 
 consistency with Article 2.2.
1300  New Zealand argues that "[a] determ ination that there has been a risk 
assessment within the meaning of Article 5.1 do es not resolve the question whether each of the 
challenged measures has a rational and objective relati onship with scientific evidence – an issue that 
arises under Article 2.2".1301  It is incorrect to assume that New Zealand has "conceded" this issue, just 
because it has not made separate arguments in re lation to the "based on" element of Article 5.1.1302  
Articles 2.2 and 5.1 "establish separate legal oblig ations, with which compliance can be separately 
assessed".1303 
7.195  In New Zealand's view, the question of whether the measures imposed by Australia are 
maintained with sufficient scientif ic evidence can be expressed in terms of both Article 2.2 ("whether 
there is a 'rational or objective relationship' be tween the measures and scientific evidence"), and 
Article 5.1 ("whether there has been a proper assessme nt of the 'likelihood of entry, establishment and 
spread' of the three relevant pests").1304  With respect to whether a measure found to be consistent with 
Article 5.1 would necessarily also be consistent w ith Article 2.2, New Zealand makes a distinction 
between two different situations.  A first situation would be when th e appropriate standard of review 
is applied to determine consistency with Article 5.1.   In this case, it is likely that an SPS measure that 
is consistent with Article 5.1 will also be consistent with Article 2.2.  This would be because of the 
rational relationship required by both provisions between the science and the SPS measure.  Even in 
this situation, however, it is possible that consiste ncy with Article 5.1 would not necessarily lead to a 
finding of consistency with Article 2.2.  A second situation would arise when "considerable 
deference" is accorded to a risk assessment under Article 5.1.  Becau se this standard allows for no 
meaningful review of whether there is a rati onal relationship between the science and the SPS 
measure, it would be impossible to say whether a measure found to be consistent with Article 5.1 
would also be consistent with Article 2.2.1305  As to whether a challenged SPS measure found to be 
inconsistent with Article 5.1 should also be found to be inconsis tent with Article 2.2, New Zealand 
argues that, if the Panel were to find that the measure  is inconsistent with Article 5.1, it should find by 
implication a breach of Article 2.2, second and third requirements.1306 
7.196  Finally, New Zealand notes that, if the Panel finds that Australia's IRA does not meet the 
requirements for a valid risk assessment set out in Article 5.1 and Annex A(4) of the SPS Agreement, 
and concludes that the measures at issue are in consistent with Article  5.1, the Panel should 
nevertheless make findings on all of the other claims before it, in order to "secure a positive solution" 
to this dispute.1307 
7.197  Australia rejects New Zealand's claims.  In its view, the measures contained in the IRA are 
consistent with Articles 5.1, 5.2 and 2.2 of the SPS Agreement.1308 
                                                      
1300 Australia's first written submission, para. 919.  S ee also, Australia's opening oral statement at the 
first substantive meeting of the Panel with the Parties, para. 42. 
1301 New Zealand's opening statement at  the second substantive meeting of the Panel with the Parties, 
para. 39. 
1302 New Zealand's opening statement at  the second substantive meeting of the Panel with the Parties, 
para. 39.  New Zealand's reply to Panel question 117 after the second substantive meeting, paras. 187-188. 
1303 New Zealand's second writte n submission, para. 2.80. 
1304 New Zealand's closing statement at the first substantive meeting of the Panel with the Parties, 
para. 6.  See also, New Zealand's opening statement at the second substantive meeting of the Panel with the 
Parties, para. 31. 
1305 New Zealand's reply to Panel question 123 after the first substantive meeting, paras. 268-270. 
1306 New Zealand's reply to Panel question 123 afte r the first substantive meeting, para. 271. 
1307 New Zealand's reply to Panel question 6 after the second substantive meeting, para. 14. 
1308 Australia's first written submission, para. 220.  See also, Australia's first written submission, 
paras. 875-876.  WT/DS367/R 
 Page 243 
 
 
 7.198  As regards the order of analysis, Australia notes th at Article 5.1 is a specific application of the 
basic obligation contained in Article 2.2.1309  There is a relationship of means and ends between the 
two provisions.1310  Generally speaking, where Members choose to rely on a risk assessment, 
"Article 2.2 sets out basic benchmarks of what  is required (ie. sufficient scientific evidence), and 
Article 5.1 sets out how this can be achieved (ie. through a risk assessment)".1311  Because of this 
relationship, the question of whether there is su fficient scientific evidence under Article 2.2 in the 
present dispute can be answered only by assessi ng whether the IRA constitutes a valid risk 
assessment.1312  In Australia's words, "Article 5.1, and its associated provisions, elaborate specific 
conditions which, if met, will establish the consiste ncy of the relevant measures with Article 2.2".1313 
7.199  Australia submits that the scientific validity of its measures cannot and should not be judged 
on any other basis but the IRA1314:  "its SPS measures stand or fall with the risk assessments in the 
Final IRA Report".1315  If the Panel finds that the challe nged measures are inconsistent with 
Article 5.1, by implication it must also conclu de that the measures are inconsistent with the 
requirement of Article 2.2 that measures may not be  maintained without suffici ent scientific evidence.  
Likewise, if the Panel finds that the challenged me asures are consistent with Article 5.1, then by 
implication it must also conclude that the m easures are consistent w ith the above-mentioned 
requirement of Article 2.2.1316  Australia submits that these arguments do not imply any legal 
hierarchy between Article 2.2 and Article 5.1.1317 
7.200  Australia submits that, in its claim under Article  5.1 of the SPS Agreement, New Zealand has 
not argued that Australia's measures are not "based on " the IRA.  Accordingly, the analysis under this 
provision should centre on whether the IRA is a valid risk assessment.1318  Focusing on the IRA, 
Australia draws support from the approach in Australia – Salmon (Article 21.5 – Canada)  to contend 
that the Panel should find a risk assessment w ould meet the requirements of Annex A(4) and 
Article 5.1 of the SPS Agreement "if the complainant fails to establish that the panel should not 'have 
reasonable confidence in the evaluation made, in particular in the levels of risk assigned.'"1319  In 
Australia's view, "[d]emonstrating the existence of di vergent view is not sufficient to actually 'prevent' 
a panel from having reasonable confidence in the evaluation made".1320  Australia argues that, 
                                                      
1309 Australia's reply to Panel question 125 after the first substantive meeting, recalling the Appellate 
Body Report on EC – Hormones , para. 180. 
1310 Australia's second written submission, para. 93. 
1311 Australia's reply to Panel question 125 after the first substantive meeting (original emphasis). 
1312 Australia's first written submission, paras.  3 44 and 919.  See also, Australia's opening oral 
statement at the first substantive meeting of the Panel w ith the Parties, para. 42;  Australia's reply to Panel 
question 124 after the first substantive meeting;  and Au stralia's second written submission, paras. 49 and 103. 
1313 Australia's opening statement at the first substantiv e meeting of the Panel with the Parties, para. 42.  
See also, Australia's reply to Panel question 125 after the first substantive meeting. 
1314 Australia's reply to Panel question 123 after the first substantive meeting.  See also, Australia's 
second written submission, paras. 446, 607, 704 and 734. 
1315 Australia's opening statement at the second substantive meeting of the Panel with the Parties, 
para. 25. 
1316 Australia's reply to Panel question 123 after the first substantive meeting.  See also, Australia's 
opening statement at the first substantive meeting of the Panel with the Parties, para. 45;  Australia's second 
written submission, paras. 97 and 607;  and Australia's reply to Panel question 1 after the second substantive 
meeting, para. 3. 
1317 Australia's second written submission, para. 99. 
1318 Australia's first written submission, para. 876.  Se e also, Australia's reply to Panel questions 19 and 
117 after the first substantive meeting;  Australia's sec ond written submission, paras. 42 , 87, 109, 134, 138, 429, 
444, 605, 693, 702, 728 and 731;  and Australia's comments to New Zealand's replies to Panel questions after 
the second substantive meeting, paras. 15, 17. 
1319 Australia's first written submission, para. 346.  Se e also, Australia's closing statement at the first 
substantive meeting of the Panel with the Parties, para. 22. 
1320 Australia's first written submission, para. 347. WT/DS367/R 
Page 244  
 
 according to the Appellate Body's more recent guidance in US/Canada – Continued Suspension , a 
panel should find a risk assessment to be valid unless  the complainant shows that it is not objectively 
justifiable because it does not reflect legitimate science,  or is not objective and coherent.  In order to 
raise a prima facie case that a particular risk as sessment is not objectively justifiable, Australia 
considers that a complainant would have to identify a nd substantiate serious errors, or flaws, with that 
assessment.
1321  In Australia's view, any lack of compre hensive or definitive evidence on a particular 
point does not render a risk assessment invalid from a legal point of view.  Under the SPS Agreement, 
the obligation to take into account scientific evidence is limited to that evidence which is "available".  
Australia also adds that data constraints and expert  judgment are part of the reality of conducting risk 
assessments in the context of a quarantine regulator y system directed at facilitating international 
trade.1322  What will be "sufficient" scientific ev idence for the imposition of measures must be 
assessed according to the specific facts and circumstan ces of each pest, taking into account Australia's 
ALOP.  Full scientific certainty does not exist.1323 
7.201  Australia argues that the IRA contains an objec tive and coherent evaluation of the likelihood 
of entry, establishment and spread of the relevant  pests, according to the SPS measures that may be 
applied.  Australia rejects New Zealand's argument that the IRA "only provides 'some' evaluation of 
the extent to which [the risk reduction factors for the three pests at i ssue] could reduce risk, 
particularly in relation to fire blight".1324  Australia contends that "the IRA Team clearly evaluated the 
scientific and technical efficacy of the principa l measures recommended to reduce the risks of the 
relevant pests to achieve Australia's ALOP, along with evaluating a number of other potential risk 
management alternatives".1325 
7.202  Australia submits that the analogy drawn by New Zealand between the Japan – Apples  case 
and the present dispute is inappropriate.  A risk assessment is contextual in that it must be "appropriate to the circumstances".
1326  New Zealand has not been able to prove that the IRA fails to 
assess "likelihood" as it should be correctly understood, nor that any of the findings in the IRA lacks 
credibility.1327  New Zealand has failed to identify flaw s in the methodology used by the IRA Team1328 
and it inappropriately purports to present its own ri sk assessment offering an alternative account of the 
evidence.1329  The IRA's assessments on fire blight, European canker and apple leafcurling midge "are 
objective and credible and should not be disturbed"1330, accordingly, these risk assessments are 
                                                      
1321 Australia's replies to Panel question 2 after the second substantive meeting, paras. 6, 7, 8 and 17. 
1322 Australia's second written submission, para. 9. 
1323 Australia's opening statement at the second substantive meeting of the Panel with the Parties, 
paras. 9-10. 
1324 New Zealand's first written submission, para. 4.383.  The expression used by Australia in its first 
written submission was not "objective and coherent", bu t "objective and credible".  In later submissions, 
Australia referred to the issue of whether the IRA's reas oning was "objective and coherent".  See, for example, 
Australia's second written submission, para. 34. 
1325 Australia's first written submission, para. 853.  S ee also, Australia's first written submission, paras.  
855-874. 
1326 Australia's first written submission, paras.  243, 250-262. 
1327 Australia's first written submission, paras.  263-278. 
1328 Australia's first written submission, paras.  288-342. 
1329 Australia's first written submission, paras.  279-287. 
1330 Australia's first written submission, para. 348.  S ee also, Australia's first written submission, paras.  
349-525, for fire blight;  526-719 for European canker;  and, 720-851 for apple leafcurling midge.  WT/DS367/R 
 Page 245 
 
 
 consistent with Article 5.1 of the SPS Agreement.1331  The consistency of Australia's measures with 
Article 5.1 establishes their consistency with Article 2.2.1332 
7.203  Australia submits that it has also acted consiste ntly with Article 5.2 of the SPS Agreement, 
since its IRA appropriately took into account all of  the factors listed therein.  New Zealand's attempt 
to convert Article 5.2 into an obligation to give "gen uine consideration" to the factors listed therein is 
not grounded in the text of the provision.1333 
7.204  Australia submits that, in any event, New Ze aland has failed to establish that Australia's 
measures are inconsistent with the requirement in Article 2.2 that measures may not be maintained 
without sufficient scientific evidence.1334  In particular, New Zealand has failed to demonstrate that 
the scientific evidence relied upon by the IRA Team w as insufficient for there to be a rational and 
objective relationship with the measures at issue a nd that the IRA Team's evaluation of the scientific 
evidence was not objective and coherent.1335 
(b) The Panel's analysis 
7.205  New Zealand's main contentions in the presen t case are "that the Australian measures are not 
supported by scientific evidence and that the IR A does not constitute a risk assessment whose 
conclusions are objectively justifiable".1336  These contentions correspond to New Zealand's claims 
under Articles 2.2, 5.1 and 5.2 of the SPS Agreement.1337  New Zealand has advanced separate and 
autonomous claims under each of these provisions.1338 
7.206  Article 2.2 of the SPS Agreement, entitled Basi c Rights and Obligations, reads as follows: 
"Members shall ensure that any sanitary 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 evidence, 
except as provided for in paragraph 7 of Article 5." 
7.207  Article 5.1, entitled Assessment of Risk and Determination of the Appropriate Level of 
Sanitary or Phytosanitary Protection, provides that: 
                                                      
1331 Australia's first written submission, paras.  524-525  for fire blight;  719 for European canker;  and 
851 for apple leafcurling midge. 
1332 Australia's first written submission, paras. 221-237.  See also, Australia's second written 
submission, paras. 88, 94 and 446. 
1333 Australia's first written submission, paras. 12, 877-911.  See also, Australia's reply to Panel 
questions 119 and 120 after the first substantive meeti ng;  Australia's second written submission, paras. 147-
153, 445, 606, 703 and 733;  and Australia's reply to Panel question 116 after the second substantive meeting, 
paras. 502-508. 
1334 Australia's first written submission, para. 919, an d Australia's second written submission, para. 103. 
1335 Australia's first written submission, paras.  9 25 and 970.  See also, Australia's first written 
submission, paras.  926-940, for fire blight;  941-952 for European canker;  953-957 for apple leafcurling midge;  and, 958-969 for general measures.  The expression used by Australia in its first written submission was 
not "objective and coherent", but "objective and credible".  In later submissions, Australia referred to the issue 
of whether the IRA's reasoning was "objective and cohere nt".  See, for example, Australia's second written 
submission, para. 34. 
1336 New Zealand's opening statement at  the second substantive meeting of the Panel with the Parties, 
para. 2.  See also, New Zealand's closing statement at the first substantive meeting of the Panel with the Parties, para. 6. 
1337 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Anne x A-1 to this report, p. 3. 
1338 Australia – Apples , Communication From the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, pp. 3-4. WT/DS367/R 
Page 246  
 
 "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 plant life or health, taking into account risk assessment techniques developed by the 
relevant international organizations." 
7.208  In turn, Article 5.2 states that: 
"In the assessment of risks, Members sha ll take into account available scientific 
evidence;  relevant processes and production methods;  relevant inspection, sampling 
and testing methods;  prevalence of specific diseases or pests;  existence of pest- or 
disease-free areas;  relevant ecological and environmental conditi ons;  and quarantine 
or other treatment." 
7.209  Finally, paragraph 4 of Annex A of the SPS Ag reement contains the following definition of a 
"risk assessment": 
"Risk assessment  – The 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 mi ght be applied, and of the associated 
potential biological and economic consequences;  or the evaluation of the potential 
for adverse effects on human or animal h ealth arising from the presence of additives, 
contaminants, toxins or disease-causing organi sms in food, beverages or feedstuffs." 
7.210  This is not the first dispute with simultane ous claims under Articles 2.2 and 5.1 of the 
SPS Agreement.  Prior panels and the Appellate Body have generally recognized the close link 
between the two provisions.  As noted by the panels and the Appellate Body in the EC – Hormones  
dispute, "Article 5.1 may be viewed as a specific  application of the basic obligations contained in 
Article 2.2 of the SPS Agreement".
1339  The Appellate Body added that  "Articles 2.2 and 5.1 should 
constantly be read together" because "Article 2.2 in forms Article 5.1:  the elements that define the 
basic obligation set out in Article 2. 2 impart meaning to Article 5.1."1340  I n  t h e  Canada/US – 
Continued Suspension  case, the Appellate Body noted further that the requirements contained in 
Article 2.2 of the SPS Agreement are made operati ve in other provisions of the SPS Agreement, 
"including Article 5.1, which requires SPS m easures to be 'based on' a risk assessment".1341 
7.211  Similarly, Article 5.2 is inextricably linked to  Article 5.1, as the former provision enumerates 
a list of factors that must be taken into account by Members when conducting their risk assessments.
1342  As noted by the panel in Japan – Apples , Articles 5.1 and 5.2 "directly inform each 
other, in that paragraph 2 sheds light on the elemen ts that are of relevance in the assessment of risks 
foreseen in paragraph 1".1343  Accordingly, the order of analysis  issue in the present case is really 
between Articles 2.2 and 5.1 of the SPS Agreement, as Article 5.2 would be considered when looking 
at Article 5.1. 
7.212  Prior cases do not provide unambiguous guidance regarding the proper order of analysis of 
simultaneous claims under Articles 2. 2 and 5.1 of the SPS Agreement.  In several such disputes, the 
                                                      
1339 Appellate Body Report on EC – Hormones , para. 180.  See also, See also, Panel Report on EC – 
Hormones (Canada) , para. 8.96;  Panel Report on EC – Hormones (US) , para. 8.93;  Appellate Body Report on 
Canada – Continued Suspension , para. 526. 
1340 Appellate Body Report on EC – Hormones , para. 180.  See also, Appellate Body Report on Canada 
– Continued Suspension , para. 526. 
1341 Appellate Body Report on Canada – Continued Suspension , para. 674. 
1342 Appellate Body Report on Canada – Continued Suspension , para. 527. 
1343 Panel Report on Japan – Apples , para. 8.230.  See also, Panel Report on US – Continued 
Suspension , para. 7.441.  WT/DS367/R 
 Page 247 
 
 
 reports started with the more specific Article 5.1.  In EC – Hormones , for example, the panel began its 
analysis by examining whether the challenged measures were based on relevant international 
standards, guidelines or recommendations or ot herwise consistent with Article 3 of the 
SPS Agreement.  Subsequently, the panel examined the risk assessment under Article 5.  After having 
found that the measures in dispute were inconsistent with the requirements of Articles 3 and 5, "and 
considering that Articles 3 and 5 provide for more specific rights and obligati ons than the 'basic rights 
and obligations' set out in Article 2" the panel saw "no need to further examine whether the... 
measures in dispute also [violated] Article 2".1344  The Appellate Body found no fault with this 
approach and agreed with the general consideration that that Article 5.1 can be viewed as a specific 
application of the basic obligations in Article 2.21345, although it mentioned that an alternative 
approach that would have started by the more general Article 2 w ould appear "logically attractive".1346  
In Australia – Salmon , the Appellate Body agreed1347 with a finding made by the panel, whereby a 
violation of Article 5.1 or 5.2 was considered to imply a violation of the more general provision of 
Article 2.2.1348  The Appellate Body also agreed with the panel's view that "given the more general 
character of Article 2.2 not all violations of Article 2.2 are covered by Articles 5.1 and 5.2".1349  
Likewise, the panel in EC – Approval and Marketing of Biotech Products  found that, by maintaining 
measures inconsistently with Article 5.1, a Member had by implication also acted inconsistently with 
the requirements in Article 2.2.1350  The compliance panel in Australia – Salmon (Article 21.5 – 
Canada)  followed the same order and found first that  the challenged measures were not based on a 
risk assessment, and were therefore inconsistent with Article 5.1.1351  It went on to find that the same 
measures were by implication also inconsistent with Article 2.2.1352 
7.213  Some panels, however, have followed a diffe rent approach.  The compliance panel in Japan – 
Apples (Article 21.5 – US) , for example, found first that the ch allenged measure was not supported by 
sufficient scientific evidence, and was th erefore inconsistent with Article 2.2.1353  The panel then went 
on to find that the same measure was not based  on a risk assessment and was therefore also 
inconsistent with Article 5.1.1354  The original panel in Japan – Apples  had followed a similar 
approach.1355 
7.214  The close link between Articles 2.2, 5.1 and 5.2 of the SPS Agreement does not mean that 
these are identical provisions.  Otherwise at least one of the provisions would be redundant.  The Panel is aware in this respect that, as noted by the Appellate Body in US – Gasoline , under the general 
rule of interpretation contained in  the Vienna Convention on the Law of  Treaties, "interpretation must 
give meaning and effect to all the terms of a treaty " and "[a]n interpreter is not free to adopt a reading 
that would result in reducing whole clauses or para graphs of a treaty to redundancy or inutility".
1356  
With respect to the specific obligation that SPS meas ures are based on scientific principles, Article 2.2 
directly focuses on the necessary link that must exist between the SPS measure and the scientific 
principles and evidence.  Under Articles 5.1 and 5.2 of the SPS Agreement, such link is still 
                                                      
1344 Panel Report on EC – Hormones (Canada) , para. 8.274.  See also, Panel Report on EC – Hormones 
(Canada) , para. 8.96;  Panel Report on EC – Hormones (US) , paras. 8.93 and 8.271. 
1345 Appellate Body Report on EC – Hormones , para. 180. 
1346 Appellate Body Report on EC – Hormones , para. 250. 
1347 Appellate Body Report on Australia – Salmon , para. 138. 
1348 Panel Report on Australia – Salmon , para. 8.52. 
1349 Appellate Body Report on Australia – Salmon , para. 138.  Panel Report on Australia – Salmon , 
para. 8.52. 
1350 Panel Report on EC – Approval and Marketing of Biotech Products , paras. 7.3393-7.3396. 
1351 Panel Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.83. 
1352 Panel Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.85. 
1353 Panel Report on Japan – Apples (Article 21.5 – US) , para. 8.120. 
1354 Panel Report on Japan – Apples (Article 21.5 – US) , para. 8.157. 
1355 Panel Report on Japan – Apples , paras. 8.199 and 8.290. 
1356 Appellate Body Report on US – Gasoline , p. 23. WT/DS367/R 
Page 248  
 
 necessary, but it is indirect as it rests on the re quirement for a risk assessment.  Any SPS measure 
must be based on a risk assessment, which, in  turn, must be based on scientific evidence. 
7.215  In the circumstances of the present case, the Pane l will deal with New Zealand's simultaneous 
claims under Article 2.2 and Article 5.1 of the SPS Ag reement, beginning its analysis with the "more 
specific" claims under Articles 5.1 and 5.2.  In the current case, Australia has justified its SPS 
measures through a risk assessment.  The scientific evidence that supports the measures should be 
(and, according to Australia, is) reflected in the risk assessment.  Accordingly, the logical starting 
point to consider a challenge against the reasoning and scientific basis for the measures is whether the 
risk assessment is in conformity with the requirements laid down in the SPS Agreement.  By focusing 
on Australia's IRA, the Panel can then determ ine whether Australia's SPS measures for the 
importation of New Zealand apples are being imposed  and maintained without sufficient scientific 
evidence.  This will entail looking at Australia's IRA in the light of the obligations contained in 
Article 5.1, while keeping in mind the factors identified in Article 5.2. 
2. Standard of review 
(a) Summary of the Parties' arguments 
7.216  Recalling the words of the Appellate Body, Aust ralia submits that the Panel should apply a 
standard of review that is specific to the SPS Ag reement and the particular obligation in question.
1357  
Under this standard, when a Member  has acted in good faith to comp ly with its obligations under the 
SPS Agreement, a panel should, in its fact-finding ro le, show a degree of deference (but not total 
deference) in its review of that Member's regulatory decisions.1358  Panels would need to show a 
relatively low level of deference to a decision by a Member directed at meeting specific requirements 
or managing the trade impact of the means by whic h a Member has sought to achieve particular ends, 
and not related to matters of sci entific or regulatory judgement.1359 
7.217  Australia argues that, when "a  Member has obtained and relied upon a comprehensive and 
transparent risk assessment" for the adoption of SPS measures, the SPS Agreement imposes a 
significant limitation on the jurisdiction of a panel.  It  would not be up to the panel to perform its own 
assessment, conducting a de novo  review of the scientific evidence, but the panel should instead 
accord considerable deference (although not total deference) to the risk assessment.1360  In considering 
the scientific basis of that risk assessment, the pa nel's role is to determine whether a valid risk 
assessment had been conducted, considering whet her the risk assessor's decision was objective and 
credible.1361  A panel need not conduct an intense scrutiny of  the scientific evidence, in order to satisfy 
its obligation to conduct an "objective assessment of  the facts", unless the complainant has established 
that the panel cannot have reasonable confidence in the risk assessment, by showing that the risk 
assessment is not objective and credible, that th e assessor failed to take into account evidence that 
would have led to a lower level of assessed risk, and that any flaws identified are "so serious" as to 
                                                      
1357 Australia's first written submission, paras. 17 6-179, recalling the Appellate Body Report on US – 
Softwood Lumber VI (Article 21.5 – Canada) , para. 92;  the Appellate Body Report on Argentina – Footwear 
(EC) , para. 121;  the Appellate Body Report on US – Lamb , paras. 102-105;  and the Appellate Body Report on 
EC – Hormones , para. 115;  Australia's closing oral statement at the first substantive meeting of the Panel with 
the Parties, paras. 11-14;  Australia's reply to Panel questions 55 and 56 after the first substantive meeting. 
1358 Australia's first written submission, paras. 180-183. 
1359 Australia's first written submission, paras. 189-190. 
1360 Australia's first written submission, paras. 191-199;   Australia's opening oral statement at the first 
substantive meeting of the Panel with the Parties, para. 36.  See also, Australia's reply to Panel question 57 after 
the first substantive meeting. 
1361 Australia's first written submission, paras. 191-199 and 241.  WT/DS367/R 
 Page 249 
 
 
 prevent the Panel from having reasonable confidence in the evaluation made.1362  An indication of the 
"seriousness" is "whether it prevents  a panel from having reasonable confidence in the overall risk 
assessment.  That reasonable confidence may be underm ined [if] the flaw in question appears to have 
made a material difference to the outcome of the assessment".1363 
7.218  Following the establishment of this Panel, the Appellate Body issued its report in 
Canada/US – Continued Suspension .  Subsequently, Australia noted that, "[g]iven that the Appellate 
Body [had] now provided detailed guidance on a pane l's standard of review in respect of risk 
assessments, Australia no longer [considered] it necessar y to use the terms 'defer ence' or 'considerable 
deference'."1364 
7.219  Australia adds that New Zealand has failed to id entify flaws in the IRA, "let alone any flaws 
serious enough to prevent the Panel from having 'reas onable confidence' in the evaluation made" with 
respect to the IRA's use of a semi-quantitative methodology1365, to the risk assessment for fire 
blight1366, to the risk assessment for European canker1367, to the risk assessment for apple leafcurling 
midge1368 and with respect to the evaluation of the like lihood of entry, establishment or spread of the 
relevant pests according to the SPS measures which might be applied.1369 
7.220  In response, New Zealand submits that the appropr iate standard of review for this case is set 
out in Article 11 of the DSU.1370  The Panel should focus on reviewing the sufficiency of the scientific 
evidence underlying Australia's SPS measures, determining whether th e IRA is supported by coherent 
reasoning and respectable scientific evidence a nd is, in this sense, objectively justifiable.1371  
New Zealand notes that the "cumulative result of all the matters raised by New Zealand in respect of 
the risk assessment conducted by the IRA is that Au stralia has failed to comply with its obligations 
under Article 5.1 of the SPS Agreement."1372 
                                                      
1362 Australia's first written submission, paras. 206 -207, 346-347 and 875;  Australia's opening oral 
statement at the first substantive meeting of the Panel with the Parties, para. 39;  Australia's closing oral 
statement at the first substantive meeting of the Panel with the Parties, para. 15;  Australia's second written 
submission, paras. 35-40;  Australia's opening oral statement at the second substantive meeting of the Panel with 
the Parties, paras. 6 and 21;  Australia's closing oral statement at the second substantive meeting of the Panel 
with the Parties, para. 2.  See also , Australia's reply to Panel question 58 after the first substantive meeting;  
Australia's second written submission, paras. 1 and 7. 
1363 Australia's reply to Panel question 2 after the second substantive meeting, para. 14.  Australia's 
comments on New Zealand's replies to Panel questions after the second substantive meeting, paras. 33-34. 
1364 Australia's second written submission, para. 15, footnote 13.  See also, Australia's opening oral 
statement at the second substantive meeting of the Panel with the Parties, para. 20. 
1365 Australia's first written submission, paras. 288-342.  See also, Australia's second written 
submission, paras. 10, and 238-312;  Australia's opening oral statement at the second substantive meeting of the 
Panel with the Parties, paras. 34-58. 
1366 Australia's first written submission, paras. 349-525.  See also, Australia's second written 
submission, paras. 313-452. 
1367 Australia's first written submission, paras. 526-719.  See also, Australia's second written 
submission, paras. 453-612. 
1368 Australia's first written submission, paras. 720-851.  See also, Australia's second written 
submission, paras. 614-700. 
1369 Australia's first written submission, paras. 852-874.  See also, Australia's second written 
submission, paras. 727-729. 
1370 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 32;  New Zealand's second wr itten submission, paras. 2.43-2.44. 
1371 New Zealand's opening oral statement at the s econd substantive meeting of the Panel with the 
Parties, paras. 31-32. 
1372 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 112.  See also, New Zealand's second written s ubmission, paras. 2.297;  New Zealand's opening oral WT/DS367/R 
Page 250  
 
 7.221  New Zealand rejects Australia's argument that the Panel should give "c onsiderable deference" 
to the IRA.  This standard finds no basis in the text of the SPS Agreement or the DSU and no basis in 
the previous findings of the Appellate Body and WTO panels.
1373  Australia's contention that, under 
Article 5.1, the appropriate role for the Panel is to determine whether its measures are based "on an 
objective and credible risk assessment" is closel y related to Australia's proposed standard of 
"considerable deference", a standard that has b een rejected by panels and the Appellate Body.1374 
7.222  New Zealand adds that Australia's argument that  New Zealand would have to show "serious 
flaws" in the IRA is not supported by the juri sprudence, nor is Australia's suggestion that 
New Zealand must demonstrate "serious flaws" at each step of the risk assessment.1375 
(b) The Panel's analysis 
7.223  The Appellate Body has repeatedly noted that "Article 11 of the DSU 'articulates with great 
succinctness but with sufficient clarity the a ppropriate standard of review for panels'1376 reviewing the 
assessment of facts under the SPS Agreement".1377  In relevant part, Article 11 of the DSU provides 
that: 
"[A] panel should make an objective assessment  of the matter before it, including an 
objective assessment of the facts of the cas e and the applicability of and conformity 
with the relevant covered agreements, and ma ke such other findings as will assist the 
DSB in making the recommendations or in giving the rulings provided for in the covered agreements." 
7.224  The Appellate Body has noted that "so far as fact-finding by panels is concerned, the 
applicable standard is 'neither de novo  review as such, nor "total deference", but rather the "objective 
assessment of facts"'."
1378 
7.225  As the Appellate Body noted in its report on Canada/US – Continued Suspension , the task of 
a panel reviewing the consistency of an SPS measure  with Article 5.1 of the SPS Agreement is to 
determine whether that SPS measure is properly b ased on a risk assessment.  While it is for the WTO 
Member to perform the risk assessment, the panel's t ask is to review that risk assessment.  A panel 
that goes beyond this mandate and acts as a risk assessor, would be substituting its own scientific 
judgement for that of the risk assessor and making a  de novo  review.  Consequently, the panel would 
be exceeding its functions under Article 11 of the DSU.   "Therefore, the review power of a panel is ... 
                                                                                                                                                                     
statement at the second subs tantive meeting of the Panel with the Parties, para. 33;  New Zealand's reply to 
Panel questions 2 and 3 after the second substantive meeting, paras. 6 and 7-8. 
1373 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
paras. 11, 33-34;  New Zealand's closing oral statement at the first substantive meeting of the Panel with the 
Parties, para. 4;  New Zealand's seco nd written submission, paras. 2.45-2.64.  See also, New Zealand's reply to 
Panel question 56 after the first substantive meeting;  New Zealand's opening oral statement at the second 
substantive meeting of the Panel with the Parties, paras. 18-22, 27 and 33. 
1374 New Zealand's second written s ubmission, paras. 2.299-2.301. 
1375 New Zealand's reply to Panel questions 2, 3 and 4 after the second substantive meeting, paras. 6, 7 
and 9.  New Zealand's comments to Australia's reply to Panel questions 2 and 3 after the second substantive 
meeting, paras. 4 and 8. 
1376 (footnote original ) [Appellate Body Report on EC – Hormones ], paras. 115 and 116. 
1377 Appellate Body Report on Canada – Continued Suspension , para. 587, quoting Appellate Body 
Report on EC – Hormones , paras. 113-114. 
1378 Appellate Body Report on Canada – Continued Suspension , para. 589, quoting Appellate Body 
Report on EC – Hormones , para. 117.  WT/DS367/R 
 Page 251 
 
 
 to determine whether that risk assessment is  supported by coherent reasoning and respectable 
scientific evidence and is, in this sense, objectively justifiable."1379 
"Accordingly, a panel reviewing the consis tency of an SPS measure with Article 5.1 
of the  SPS Agreement  must, first, identify the scientific basis upon which the SPS 
measure was adopted. ... Having identified the scientific basis underlying the SPS 
measure, the panel must then verify that the scientific basis comes from a respected 
and qualified source. ... A panel should also  assess whether the reasoning articulated 
on the basis of the scientific evidence is obj ective and coherent.  In other words, a 
panel should review whether the particul ar conclusions drawn by the Member 
assessing the risk find sufficient support in  the scientific evidence relied upon.  
Finally, the panel must determine whether the results of the risk assessment 
'sufficiently warrant' the SPS measure at issue.1380"1381 
7.226  In the considerations above, the Panel finds enough guidance on how to review Australia's 
SPS measures.  The Panel finds no reason to articulate a standard of review that departs from such 
guidance.  In any event, the Panel notes that, in its second written submission, Australia indicated that 
it would no longer insist on its earlier suggestion that , in its analysis of Australia's SPS measures 
under Article 5.1, the Panel should accord "cons iderable deference" to Australia's IRA.1382 
7.227  As quoted by Australia, the compliance panel on Australia – Salmon (Article 21.5 – Canada)  
pointed out that it had found "difficult to read into  the summary definition of  risk assessment set out 
in paragraph 4 of Annex A – whic h only refers to 'the evaluation of the likelihood' – specific 
requirements such that minor flaws or misconceptions at a detailed level would preclude a study from 
falling within the SPS definition of risk assessment".1383  That panel added that "there may be studies 
that are flawed or biased to such ex tent that they cannot be said to meet any standard of objectivity.  
We do not think that such studies should pass the te st of a risk assessment in accordance with the 
SPS Agreement."1384 
7.228  The reasoning made by the compliance panel on Australia – Salmon (Article 21.5 – Canada)  
does not necessarily clash with the general rules on the appropriate standard of review provided in the 
DSB and explained by the Appellate Body.  The Panel remains bound to make an objective 
assessment of the matter before it.  It is only under the circumstances of each case, that a panel can assess whether any flaws or misconceptions in a ri sk assessment, alleged and demonstrated by the 
complainant, are only minor or whether they are se rious enough to conclude that the risk assessment 
is not supported by coherent reasoning and respectab le scientific evidence and is, in this sense, not 
objectively justifiable.  At the same time, a number  of "minor flaws or misconceptions at a detailed 
level" may have a cumulative effect so as to call into question the coherence and objectivity of the 
conclusions drawn by the Member assessing risk. 
7.229  The Panel will accordingly turn to  reviewing Australia's IRA, c onsidering its scientific basis 
and reasoning in the light of the alleged flaws that have been identified by New Zealand, in order to 
determine whether New Zealand has articulated a prima facie case that the IRA is not a proper risk 
assessment within the meaning of Article 5.1 of the SPS Agreement. 
                                                     
 
1379 Appellate Body Report on Canada – Continued Suspension , para. 590. 
1380 (footnote original ) [Appellate Body Report on EC – Hormones ], para. 193. 
1381 Appellate Body Report on Canada – Continued Suspension , para. 591. 
1382 Australia's second written submission, para. 15, footnote 13. 
1383 Panel Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.47.  See, for example, 
Australia's first written submission, para. 206. 
1384 Panel Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.47. WT/DS367/R 
Page 252  
 
 3. Summary of the Parties' arguments under Articles 5.1 and 5.2 of the SPS Agreement 
7.230  As noted above, New Zealand argues that Austra lia's IRA is not a risk assessment within the 
meaning of Article 5.1 of the SPS Agreement.
1385  Australia has not properly evaluated the likelihood 
of entry, establishment or spread of the three re levant pests, nor has it evaluated that likelihood 
according to the SPS measures which might be applied.1386  In New Zealand's view, "the conclusions 
in the IRA do not find sufficient suppor t in the scientific evidence relied upon".1387  To the extent that 
a proper risk assessment does not exist to support Australia's measures, those measures cannot be said 
to be "based on" a risk assessment.1388 
7.231  New Zealand does not challenge per se  Australia's choice to use a semi-quantitative approach 
to assess the risk associated with th e three pests at issue in this dispute.  New Zealand does, however, 
argue that such an approach may provide a mi sleading impression of objectivity and precision.1389  In 
addition, in New Zealand's view, the particular a pplication of the semi-quantitative method used in the 
IRA produces a distorted estimate of risk, turning events  that "would almost certainly not occur" into 
events that "will be expected to occur relativel y frequently" and converting "pathways that did not 
exist" into "continuous pathways for the transmission of pests".1390  New Zealand also argues that: 
"[W]ith regard to many of the individual steps in the relevant pathways ... 
assessments in the IRA significantly overest imate the risk. ... [I]n many instances, 
these are events which have never been demons trated to occur, and for which there is 
no scientific evidence to suggest they woul d occur.  Moreover the numbers actually 
assigned in the IRA find no support in the science.  The distorting effect is compounded where a number of these even ts occur in the same pathway."
1391 
7.232  New Zealand identifies three "fundamental methodo logical flaws" in Australia's IRA that, in 
combination, would result in a vastly overestimated probability of entry, establishment and spread of 
the pests at issue.  According to New Zealand:  "[t]hese flaws magnify the assessment of risk, turning 
what are often the remotest of possibilities into events that are assessed as occurring with some 
frequency."1392  The first methodological flaw identified by  New Zealand is the IRA's choice of "an 
inflated maximum value [of 1 × 10-6] for the probability of events with a negligible likelihood of 
occurring".1393  The second methodological flaw is the "ina ppropriate use of [a] uniform distribution 
to model the likelihood of events, particularly those with a 'negligible' likelihood of occurring".1394  
                                                      
1385 New Zealand's first wr itten submission, para. 4.158.  S ee also, New Zealand's first written 
submission, para. 4.153. 
1386 New Zealand's first written submission, paras. 1.8, 4.158 and 4.403-4.404.  See also, 
New Zealand's first written submission, paras. 4.160, 4.204 -4.206, 4.207, 4.265, 4.333, 4.378, 4.383 and 4.402;  
and, New Zealand's second written submission, paras. 2.293-2.803. 
1387 New Zealand's second writte n submission, para. 2.296. 
1388 New Zealand's first written subm ission, para. 4.153.  See also , New Zealand's reply to Panel 
question 117 after the first substantive meeting, para. 257;  and, New Zealand's second written submission, 
para. 2.794. 
1389 New Zealand's first written submission, para. 4. 165;  New Zealand's se cond written submission, 
para. 2.327. 
1390 New Zealand's first written s ubmission, paras. 4.171-4.173. 
1391 New Zealand's second writte n submission, para. 2.297. 
1392 Ibid. 
1393 New Zealand's first wr itten submission, para. 4.172.  S ee also, New Zealand's first written 
submission, para. 4.174-4.186;  New Zealand's second written submission, para. 2.333-2.352. 
1394 New Zealand's first wr itten submission, para. 4.172.  S ee also, New Zealand's first written 
submission, para. 4.187-4.193;  New Zealand's second written submission, para. 2.353-2.358.  WT/DS367/R 
 Page 253 
 
 
 The third methodological flaw is "the overestimation of the projected volume of trade" in 
New Zealand apples.1395 
7.233  New Zealand states that Australia's measures ar e also inconsistent with Article 5.2 of the 
SPS Agreement.  At various points, Australia's IR A failed to give genuine consideration to the 
relevant scientific evidence;  to the relevant processes and production methods;  to the relevant 
inspection, sampling and testing methods;  to the prev alence of the relevant diseases or pests;  and to 
the relevant environmental conditions.1396 
7.234  Australia responds that the IRA is a prope r risk assessment under Article 5.1 of the 
SPS Agreement.  New Zealand fails to recognize th at risk assessments must confront scientific 
uncertainty, which may only be resolved or accommodated "through the exercise of expert judgement 
in accordance with the specific requirements of each case".1397  The legal question that the Panel must 
consider is not whether New Zealand's "alternative sc ientific account" is credible or even represents 
mainstream opinion, but whether Australia's meas ures are based on an objective and coherent risk 
assessment.1398  In this respect, Australia considers that , in order to make a case that the reasoning 
articulated in the IRA is not objective and coherent , New Zealand would need to substantiate serious 
flaws in that assessment;  minor flaws would not be sufficient to undermine the IRA's overall 
objectivity and coherence.1399 
7.235  Australia also argues that New Zealand fails to appreciate that risk assessments must be 
appropriate to the circumstances and, therefore, th at they must take into account country-specific 
situations.  Because Australia's agricultural sector  and biological diversity are both dependent on 
Australia's pest and disease status, the risks of pest  and disease incursion in Australia are often serious 
and irreversible.1400  Australia adds that New Zealand mistakenly attempts to draw a direct analogy 
between the findings of the panel in Japan – Apples  and the present dispute.  The reports in Japan – 
Apples  do not constitute a risk assessment, and their findi ngs are specific to the circumstances of that 
dispute, which are different from the facts of the current case.1401 
7.236  Australia rejects New Zealand's contention th at the IRA has not properly evaluated the 
likelihood of entry, establishment or spread of the three relevant pests, and that it has not evaluated 
that likelihood according to the SPS measures which might be applied.1402  Australia argues in this 
regard that the IRA has properly assigned a quant itative or qualitative estimation of likelihood to 
                                                      
1395 New Zealand's first wr itten submission, para. 4.172.  S ee also, New Zealand's first written 
submission, para. 4.194-4.203;  New Zealand's second written submission, para. 2.359-2.367. 
1396 New Zealand's first written submission, paras.  1.11, 1.12, 4.411-4.428;  New Zealand's opening 
oral statement at the first substantive meeting of the Panel with the Parties, paras. 113-114.  See also, 
New Zealand's reply to Panel question 121 after the firs t substantive meeting, paras. 259-265;  New Zealand's 
second written submission, paras. 2.804-2.816;  New Zeala nd's opening oral statement at the second substantive 
meeting of the Panel with the Parties, para. 110;  Ne w Zealand's reply to Panel question 116 after the second 
substantive meeting, paras. 182-186;  and New Zealand's comments on Australia's reply to Panel question 116 
after the second substantive meeting, para. 269. 
1397 Australia's first written submission, para. 233.  See also, Australia's first written submission, 
paras. 231-235;  Australia's second written submission, paras. 111-116. 
1398 Australia's first written submission, paras. 240-241. 
1399 Australia's second written submission, para. 35. 
1400 Australia's first written submission, paras. 243-249.  See also, Australia's second written 
submission, paras. 117-121. 
1401 Australia's first written submission, paras. 250-261.   See also, Australia's opening oral statement at 
the first substantive meeting of the Panel with the Parties, para. 19. 
1402 Australia's first written submission, para. 263. WT/DS367/R 
Page 254  
 
 every step in the risk assessment.
1403  Australia likewise rejects Ne w Zealand's complaint regarding 
the IRA's consideration of events  with a "negligible" likelihood.1404 
7.237  In Australia's view, New Zealand cannot ma ke a prima facie case against the IRA under 
Article 5.1 of the SPS Agreement by conducting its own risk assessment according to its own 
methodology.1405  Australia argues further that New Zeal and fails to identify flaws in the semi-
quantitative methodology used in the IRA1406 and that New Zealand's re liance in this regard on a 
handbook by the OIE is inappropriate.1407  Australia submits also that the IRA's use of a probability 
interval of 0-10-6 is appropriate1408, that the IRA's use of uniform distribution did not inflate risk1409 
and that New Zealand's assertions on the volume of trade are based on faulty assumptions.1410 
7.238  Regarding New Zealand's argument that the challe nged measures are also inconsistent with 
Article 5.2 of the SPS Agreement, Australia responds  that the IRA Team took into account all of the 
factors listed in Article 5.2, including those identif ied by New Zealand, and New Zealand has failed to 
demonstrate otherwise.  Australia argues further that New Zealand's reading of Article 5 as an 
obligation to give "genuine  consideration" to these factors is not  grounded in the text of the provision 
and is instead merely a complaint that the IRA Team took a different view to New Zealand's own 
view of these factors.1411 
7.239  Australia argues finally that the IRA makes an objective and credible evaluation of the 
likelihood of entry, establishment and spread of the three relevant  pests, as well as the associated 
potential biological and economic consequences, and New Zealand fails to prove otherwise.1412  
Australia concludes that its measures are consis tent with Article 5.1 of the SPS Agreement and, 
accordingly, also with Article 2.2.1413 
4. Requirements regarding fire blight 
7.240  The IRA contains a section describing the biol ogy of the bacterial disease fire blight, 
a description of the risk scenario, a discussion of th e likelihood of entry, establishment and spread of 
fire blight, an assessment of the consequences, a d escription of the unrestricted risk and, finally, 
a discussion of risk management measures.1414 
                                                      
1403 Australia's first written submission, paras. 265-268. 
1404 Australia's first written submission, paras. 269-275. 
1405 Australia's first written submission, paras. 279-287. 
1406 Australia's first written submission, para. 288.  See also, Australia's second written submission, 
paras. 222-237;  Australia's opening oral statement at the second substantive meeting of the Panel with the Parties, paras. 34-35. 
1407 Australia's first written submission, paras. 290-294. 
1408 Australia's first written submission, paras. 295-311.  See also, Australia's second written 
submission, paras. 242-246;  Australia's opening oral statement at the second substantive meeting of the Panel 
with the Parties, paras. 36-46. 
1409 Australia's first written submission, paras. 312-318.  See also, Australia's second written 
submission, paras. 264-274;  Australia's opening oral statement at the second substantive meeting of the Panel 
with the Parties, paras. 47-52. 
1410 Australia's first written submission, paras. 319-341.  See also, Australia's second written 
submission, paras. 275-311;  Australia's opening oral statement at the second substantive meeting of the Panel 
with the Parties, paras. 53-57. 
1411 Australia's first written submission, paras. 877-880;  Australia's second written submission, 
paras. 147-153. 
1412 Australia's first written submission, paras. 348-874.  See also, Australia's second written 
submission, paras. 313-444, 453-605, 614-702 and 731-733. 
1413 Australia's first written submission, paras. 344, 875-876. 
1414 Australia's IRA, Part B, pp. 51-116.  WT/DS367/R 
 Page 255 
 
 
 7.241  In its panel request, New Zealand challeng es the following requirements imposed by 
Australia with respect to fire blight: 
• "The requirement that apples be sourced from areas free from fire blight 
disease symptoms. 
• The requirement that orchards/blocks be inspected for fire blight disease 
symptoms, including that they be inspect ed at an inspection intensity that 
would, at a 95% confidence level, detect visual symptoms if shown by 1% of 
the trees, and that such inspections take place between 4 to 7 weeks after 
flowering. 
• The requirement that an orchard/bloc k inspection methodology be developed 
and approved that addresses issues such as 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 training and certification of inspectors. 
• The requirement that an orchard/block 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. 
• The requirement that an orchard/block be suspended for the season on the 
basis of detection of any visual symptoms of fire blight. 
• The requirement that apples be subject to disinfection treatment in the 
packing house. 
• The requirement that all grading and pa cking equipment that comes in direct 
contact with apples be cleaned and disinfected (using an approved disinfectant) immediately before each Australian packing run. 
• The requirement that packing houses re gistered for export of apples process 
only fruit sourced from registered orchards."
1415 
7.242  New Zealand argues that: 
"The Australian contention that mature, symptomless apples provide a pathway for 
transmitting fire blight is not supported by scientific evidence.  Such a pathway has 
not been shown to exist ... Australia's contention finds no support in science.  
Speculation about a transmission pathway do es not constitute 'sufficient scientific 
evidence' within the meaning of Article 2.2 [of the SPS Agreement].  The likelihood 
of the coincidence of circumstances that  would be required to establish such a 
pathway for transmission of the diseas e via mature, symptomless fruit is 
negligible."1416 
                                                      
1415 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A-1 to this report, pp . 1-2.  See also, Australia's  IRA, Part B, pp. 105-116. 
1416 New Zealand's first written submission, paras. 4.7-4.8.  See also, New Zealand's first written 
submission, paras. 4.10, 4.31-4.32, 4.51 and 4.150;  New Zealand's second written submission, paras. 2.104-
2.124. WT/DS367/R 
Page 256  
 
 7.243  In New Zealand's view, "[t]he IRA fails to ev aluate the 'likelihood' of entry, establishment 
and spread of fire blight as well as the potentia l biological and economic consequences within the 
meaning of paragraph 4 of Annex A.  Accordingly Au stralia has failed to comply with its obligations 
under Article 5.1 of the SPS Agreement."
1417 
7.244  New Zealand adds that Australia is also in viol ation of its obligations under Article 5.1 of the 
SPS Agreement because "[t]he IRA fails to provide  an evaluation of the likelihood of entry, 
establishment or spread of the diseases and pest s of concern 'according to the SPS measures which 
might be applied' and, therefore, fails to meet th e third requirement for a risk assessment within the 
meaning of paragraph 4 of Annex A."1418 
7.245  The Panel will start by considering Australia's re quirements with respect to fire blight under 
Articles 5.1 and 5.2 of the SPS Agreement, focusing on the specific alleged flaws in the IRA 
identified by New Zealand in its various submissi ons.  The Panel will consider whether New Zealand 
has properly made the case that: 
(a) The IRA contains methodological flaws that result in a vast overestimation of the 
probability of entry, establishment and spread of fire blight, as well as of the other 
relevant pests in this dispute, into Australia through apples from New Zealand; 
(b) The IRA has overestimated the probability of entry, establishment and spread of fire 
blight into Australia through apples fro m New Zealand, including through the 
estimation of various "importation steps", a nd the IRA's reasoning in this regard is 
not properly based on scientific evidence; 
(c) The IRA has overestimated the potential biological and economic consequences 
associated with the entry, establishment and sp read of fire blight in Australia, and the 
IRA's reasoning in this regard is not properly based on scientific evidence; 
(d) The IRA has overestimated the unrestricted risk of fire blight from apples from 
New Zealand, and the IRA's reasoning in this regard is not properly based on 
scientific evidence;  and, 
(e) Australia's requirements imposed by Austra lia with respect to fire blight are 
consequently not properly based on scientific evidence and, consequently, inconsistent with the SPS Agreement. 
Subsequently, and if necessary, the Panel will turn to New Zealand's allegation that the IRA fails to 
provide an evaluation of the likelihood of entry, est ablishment or spread of fire blight "according to 
the SPS measures which might be applied". 
7.246  The Panel will conduct this review beginning wi th the arguments raised by New Zealand 
specifically in the context of the IRA's analysis re garding fire blight.  The Panel will follow the same 
order as the IRA, which is generally the order in wh ich Parties raised their arguments.  Accordingly, 
the Panel will consider the issues as follows:  the eight importation steps described in the IRA;  the 
IRA's analysis of proximity;  the IRA's analysis of exposure;  the IRA's analysis of establishment;  
the IRA's analysis of spread;  the IRA's analysis  of the potential associated biological and economic 
                                                     
 
1417 New Zealand's first wr itten submission, para. 4.265.  S ee also, New Zealand's first written 
submission, paras. 4.208-4.265 and 4.403-4.404;  New Zealand's second written submission, paras. 2.293, 
2.368, 2.458 
1418 New Zealand's first wr itten submission, para. 4.402.  S ee also, New Zealand's first written 
submission, paras. 4.403-4.404 and 4.384-4.392;  New Zealand's opening oral statement at the first substantive 
meeting of the Panel with the Partie s, paras. 108-111;  New Zealand's s econd written submission, para. 2.785.  WT/DS367/R 
 Page 257 
 
 
 consequences;  and, the IRA's analysis of the unrestrict ed risk of fire blight.  The Panel will then, if 
necessary, turn to New Zealand's arguments regard ing the alleged methodological flaws in the IRA. 
(a) Alleged overestimation for importation step 1 
7.247  Importation step 1 represents the likelihood that the relevant pest is present in the source 
orchards.1419 
(i) Summary of the Parties' arguments 
7.248  Regarding importation step 1 for fire blight, New Zealand argues that the IRA's estimation 
that Erwinia amylovora  would be present in 100 per cent of source orchards in New Zealand is 
incorrect and constitutes a "significant overestimation".1420  In New Zealand's view, this conclusion is 
"based on a misreading of scientific literature and in correct assumptions [and is] not supported by the 
scientific evidence".1421 
7.249  New Zealand contends that the evidence cite d by the IRA does not demonstrate, as claimed 
by the IRA that " E. amylovora  was detected in New Zealand both from orchards with fire blight 
symptoms ... and those without symptoms."1422  New Zealand adds that "it is widely accepted in the 
scientific literature and by the scientific community th at fruit from orchards with no symptoms of fire 
blight do not harbour populations of E. amylovora ."1423  New Zealand also rejects the IRA's statement 
that "fire blight caused by E. amylovora is widespread in New Zealand and supports the conclusion 
that the bacterium would be present in all orchards at harvest throughout the major production areas".
1424  New Zealand argues instead that "fire blight is not routinely detected in all orchards in 
New Zealand;  the disease is sporadic in nature."1425 
7.250  In response, Australia contends that, because the IRA found that "[t]here is no scientific 
literature that indicates that any area of New Zeala nd is free of the fire blight bacteria and MAFNZ 
has not provided any information in support of freedom for any apple producing areas in New Zealand"
1426, it concluded that the likelihood that Erwinia amylovora  is present in the source 
orchards in New Zealand is 1 (100 per cent).1427 
7.251  In Australia's view, New Zealand misunderstands the purpose of importation step 1.  This 
importation step "is not concerned with the presence of E. amylovora  on fruit, nor is it concerned with 
                                                      
1419 Australia's IRA, Part B, pp. 19-21. 
1420 New Zealand's first written subm ission, para. 4.212.  See also New Zealand's second written 
submission, para. 2.402. 
1421 New Zealand's first writte n submission, para. 4.209. 
1422 New Zealand's first written submission, para. 4.210.  Australia's IRA, Part B, p. 53, referring to 
Hale et al. , "Occurrence of Erwinia amylovora  on apple fruit in New Zealand" (1987), in Exhibit NZ-21;  and 
Clark et al. , "A DNA approach to Erwinia amylovora  detection in large scale apple testing and in 
epidemiological studies" (1993), in Exhibit NZ-53. 
1423 New Zealand's first written submission, para. 4.210,  referring to Thomson, "Epidemiology of fire 
blight" (2000), p.17, in Exhibit NZ-05;  Roberts et al. , "The potential for spread of Erwinia amylovora  and fire 
blight via commercial apple fruit" (1998), p. 23, in Exhibit NZ-22;  and Hale et al.  "Occurrence of Erwinia 
amylovora  on apple fruit in New Zealand" (1987), in Exhibit NZ-21, p. 37. 
1424 Australia's IRA, Part B, p. 53. 
1425 New Zealand's first written submission, para. 4.211, referring to Thomson and Hale, "A 
comparison of fire blight incidence and environment between New Zealand and Western United States (1987), 
p. 1, in Exhibit NZ-94. 
1426 Australia's IRA, Part B, p. 54. 
1427 Australia's first written submission, para. 378. WT/DS367/R 
Page 258  
 
 the occurrence (or non occurrence) of disease symptoms .  It is concerned exclusively with the 
presence of E. amylovora  in source orchards ."
1428 
7.252  In Australia's words: 
"[T]he presence or absence of fire blight symptoms, on their own, are not a good 
indicator of the presence or absence of E. amylovora  in an orchard.  The organism 
can be present in orchards even if disease symptoms are not detected, or the orchard 
is surrounded by infected alternative hosts.  This is precisely the point made in the 
discussion under Importation step 1 in the Final IRA Report.1429  Accordingly, 
New Zealand's claim that 'fire blight is not routinely detected in all orchards in New Zealand' because the 'di sease is sporadic in nature'
1430 is also irrelevant because 
it relates entirely to the detection of disease symptoms."1431 
7.253  Australia submits that, under Article 5.2 of  the SPS Agreement, risk assessors can only 
proceed on the scientific evidence available;  in that sense, they would not be obliged to make 
assumptions on issues such as orchard freedom without reliable proof from the exporting Member that those orchards are in fact free of Erwinia amylovora .  While there was evidence supporting the 
conclusion that no orchard could be assumed free of Erwinia amylovora , there was no evidence 
demonstrating freedom in any potential export orchard.
1432 
7.254  Australia concludes that the IRA "did not mi sread the scientific literature, make incorrect 
assumptions or fail to take account of scientific evidence".  Accordingly, Australia submits that 
"New Zealand has not presented any arguments or evidence that show the conclusions of the IRA 
Team in relation to Importation step 1 are flawed."1433 
(ii) The Panel's analysis 
7.255  The IRA estimates the likelihood that Erwinia amylovora  is present in the source orchards in 
New Zealand as 1 (100 per cent).1434  This is based on a consideration that "[t]here is no scientific 
literature that indicates that any area of New Zeala nd is free of the fire blight bacteria and MAFNZ 
has not provided any information in support of freedom for any apple producing areas in 
New Zealand."1435 
7.256  An important element of the IRA's analysis in  this regard is its consideration that " Erwinia 
amylovora  was detected in New Zealand both from orchards with fire blight symptoms ... and those 
without symptoms."1436  As noted by Dr Paulin, one of the experts assisting the Panel, the assumption 
that Erwinia amylovora  can be present in orchards even if di sease symptoms are not detected is well 
known.1437  The expert explained that the possibility that Erwinia amylovora , after having infected a 
                                                      
1428 Australia's first written submission, para. 379 (original emphasis;  footnote omitted). 
1429 (footnote original ) Final IRA Report, Part B, pp. 53-54. 
1430 (footnote original ) New Zealand's first written submission, para. 4.211. 
1431 Australia's first written submission, para. 382. 
1432 Australia's second written submission, para. 364. 
1433 Australia's first written submission, para. 383.  See also, Australia's second written submission, 
para. 365. 
1434 Australia's IRA, Part B, pp. 53-55. 
1435 Australia's IRA, Part B, p. 54. 
1436 Australia's IRA, Part B, p. 53. 
1437 Dr Paulin's reply to Panel question 22, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 147 and 150.  WT/DS367/R 
 Page 259 
 
 
 plant, may migrate inside the tree is well documented.1438  This may result in the presence of 
undetected bacterial population in the trunks and branch es.  Dr Paulin explained, however, that this 
population is unlikely to pollute the fruit surface, being internal to the tree.1439  Another expert, 
Dr Deckers and Dr Paulin agreed that another sour ce of bacteria in a healthy orchard could be wind-
driven rain or insects or birds carrying bact eria in ooze from near-by (but possibly unseen) 
"alternative" host plants, which may be difficult to  survey, and whose presence is sometimes not even 
acknowledged.1440  In any event, Dr Paulin noted that these bacteria would soon disappear, because 
Erwinia amylovora is generally not a good epiphyte, although they may cause late infection which 
may constitute a bacterial population in a symptoml ess orchard.  According to Dr Paulin, this 
possibiliy is "probably more likely in the case of New Zealand, where the history of fire blight is very 
long on the same sites.  (The European concept of 'protected zone' is probably not applicable in this 
case.)"1441 
7.257  Importation step 1 is a very important starting point for Australia's IRA.  The following step, 
importation step 2, assesses the likelihood th at picked fruit is contaminated with Erwinia amylovora .  
The likelihood in step 2 is directly related to the hi story of fire blight in the year of cropping (whether 
active symptoms producing inoculum were present) and in the previous years (for the possibility of 
internal presence of Erwinia amylovora  in the xylem).  Consulted by th e Panel, Dr Paulin noted that, 
if this latter possibility has very little chance to r esult in internal fruit contamination (especially in 
mature symptomless apples), these chances are nil if Erwinia amylovora  has not been present in the 
orchard for years.1442 
7.258  As noted by Dr Paulin, due to the long history of fire blight in New Zealand, it seems difficult 
to be sure in advance that any orchard is free from fi re blight.  In the Panel's view, the scientific basis 
considered by the IRA in this regard comes fro m respected and qualified sources.  This does not 
mean, however, that each orchard in New Zealand will present Erwinia amylovora  or symptoms of 
the fire blight disease every year.1443  The probability of one, assigned by the IRA, means that Erwinia 
amylovora  is present and would always be present, in all of New Zealand source orchards.1444  The 
scientific evidence presented in the IRA does not demons trate that this is true.  On the contrary, the 
evidence indicates that at least some source orch ards in New Zealand will at times be free from 
Erwinia amylovora .  Accordingly, while the IRA's basis with  respect to this importation step comes 
from respected and qualified scientific sources, the IRA' s reasoning in this regard is not coherent and 
objective and the resulting likelihood assigned to this st ep is exaggerated.  As noted by Dr Paulin, 
"[i]f the probability of 1 means that all orchards are contaminated by E amylovora  each year, it is 
probably a mere exaggeration. ... [E]ach apple orchard symptom-free in New Zealand may be 
                                                      
1438 Thomson, "Epidemiology of fire blight" (2000), in Exhibit NZ-05.  See, Reply of Dr Paulin to 
Panel question 22, in List of Replies from the scientific  experts to questions posed by the Panel, para. 147. 
1439 Dr Paulin's reply to Panel question 22, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 147. 
1440 Dr Paulin's reply to Panel question 22, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 148.  See also, Dr Deckers' reply to Panel question 22, in List of Replies from the scientific experts to questions posed by the Panel, para. 164. 
1441 Dr Paulin's reply to Panel question 22, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 148. 
1442 Dr Paulin's reply to Panel question 23, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 166. 
1443 Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 315. 
1444 Dr Sgrillo's reply to Panel question 22, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 163;  Dr Sgrillo's reply in Tr anscript of the Panel's meeting with experts, para. 319. WT/DS367/R 
Page 260  
 
 temporarily  contaminated by E amylovora , not permanently.  Therefore the chance for apples to be 
sourced from orchards harbouring E. amylovora  should be significantly less than one."
1445 
7.259  In conclusion, the Panel finds that the IRA's estimation that Erwinia amylovora  will always 
be present in the source orchards in New Zealand is not sufficiently supported by the scientific evidence that the IRA relied upon and, accord ingly, is not coherent and objective. 
(b) Alleged overestimation for importation step 2 
7.260  Importation step 2 represents the likelihood that  fruit coming from an infected or infested 
orchard is infected or infested.
1446 
(i) Summary of the Parties' arguments 
7.261  Regarding importation step 2 for fire blight, New Zealand argues that the IRA "seriously 
overestimates the likelihood of mature fruit be ing infested (let alone infected)" with Erwinia 
amylovora .1447  In New Zealand's view, the IRA's probabilit y value for this step  "has been assigned on 
the basis of a misreading or discounting of the scientific literature".1448  The papers cited by the IRA 
do not support the IRA's estimates of in festation/infection of apples with Erwinia amylovora :1449 
"[T]he IRA assigns a probability for infection or infestation of mature fruit that is 
over 20 times higher than is justified by th e scientific evidence.  In any event, the 
numbers of bacteria found on mature fruit are insufficient to be spread to and colonise 
a new host to initiate an infection (were su ch spread possible). Indeed, there is no 
pathway for the transmission of fire blight by mature, symptomless apples."1450 
7.262  New Zealand concludes that "[i]n the absen ce of scientific support for the probability 
assigned to this step, the IRA should instead have treated such probability as negligible."1451 
                                                      
1445 Dr Paulin's reply to Panel question 22, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 161 (original emphasis).  See also, Dr Paulin's reply in Transcript of the Panel's 
meeting with experts, para. 315;  Dr Paulin's and Dr Sc hrader's replies to Panel question 22, in List of Replies 
from the scientific experts to questions posed by the Panel, paras. 152, 157 and 159 and 162. 
1446 Australia's IRA, Part B, pp. 19-21. 
1447 New Zealand's first writte n submission, para. 4.217. 
1448 New Zealand's first written submission, para. 4.213.  Australia's IRA, Part B, pp. 55-65.  See also, 
Clark et al. , "A DNA approach to Erwinia amylovora  detection in large scale apple testing and in 
epidemiological studies" (1993), in Exhibit NZ-53;  van der Zwet et al., "Population of Erwinia amylovora  on 
External and Internal Apple Fruit Tissues" (1990), in Exhibit AUS-31;  Hale et al. , "Occurrence of Erwinia 
amylovora  on apple fruit in New Zealand" (1987), in Exhibit NZ-21;  Hale and Taylor, "Effect of Cool Storage 
on Survival of Erwinia amylovora  on Apple Calyxes" (1999), in Exhibit NZ-24;  Dueck, "Survival of Erwinia 
amylovora  in Association with Mature Apple Fruit" (1974), in Exhibit NZ-96;  Roberts et al. , "Evaluation of 
Mature Apple Fruit from Washington State for the presence of Erwinia amylovora " (1989), in Exhibit NZ-97;  
Roberts, "Evaluation of Buffer Zone Size and Inspection Number Reduction on Phytosanitary Risk Associated 
with Fire Blight and Export of Mature Apple Fruit" (2002), in Exhibit NZ-20;  Roberts et al. , "The potential for 
spread of Erwinia amylovora  and fire blight via commercial apple fruit;  A critical review and risk assessment" 
(1998), in Exhibit NZ-22;  and, Roberts and Sawyer, "An updated pest risk assessment for spread of Erwinia 
amylovora  and fire blight via commercial apple fruit" (2008), in Exhibit NZ-29. 
1449 New Zealand's first written submission, para. 4.213-4.220.  See also New Zealand's comments on 
Australia's replies to New Zealand's question 1 after the second substantive meeting, paras. 1-5. 
1450 New Zealand's first written submission, para. 4.21 9.  See, Roberts and Sawyer, "An updated pest 
risk assessment for spread of Erwinia amylovora  and fire blight via commercial  apple fruit" (2008), in Exhibit 
NZ-29. 
1451 New Zealand's first writte n submission, para. 4.220.  WT/DS367/R 
 Page 261 
 
 
 7.263  In response, Australia contends that New Z ealand's assertions regarding importation step 2 
"are without merit".1452  Australia argues that, "[i]n contrast to the comprehensive analysis conducted 
by the IRA Team, New Zealand refers to only a hand ful of scientific studies in support of its claims, 
and places particular reliance on the conclusions in Roberts and Sawyer (2008)."1453  Australia makes 
a number of arguments in relati on to Roberts and Sawyer (2008).1454  Australia argues that none of the 
studies relied upon by Roberts and Sawyer (2008) we re sensitive enough to detect very low numbers 
of E. amylovora  on or in apple fruit.1455  It argues that the findings in Roberts and Sawyer (2008) are 
largely based on studies relevant to the circumstan ces of the trade in apples from the United States to 
Japan prior to the Japan – Apples  dispute, which involved the use of phytosanitary measures.  As 
such, these studies are not relevant to the as sessment of unrestricted risk in the IRA.1456  It also argues 
that Roberts and Sawyer (2008) uses data inconsistently.1457 
7.264  Australia adds that importation step 2 is re presented by a probability range, and not by a 
single value.1458  Contrary to New Zealand's assumption, Australia argues that the IRA "drew a very 
clear distinction between internal infection and external infestation of apples".1459  According to 
Australia, the IRA found a paucity of evidence on endoph ytic (internal) infection in mature fruit.  
Accordingly, the IRA concludes that the importa tion risk scenario of particular relevance to Erwinia 
amylovora  is instead one associated with epiphytic external infestation.1460 
7.265  Australia argues further that New Zealand's claim "is based on a selective reading of the 
evidence which, in places, misrep resents the scientific studies actually relied on by New Zealand."1461  
It is not enough for New Zealand to show that there is an alternative scientific account of a particular 
phenomenon.  New Zealand has not shown that th e account given in the IRA is not credible.  
Australia submits, however, that "even if the alte rnative assessments of like lihood are taken at face 
value ... they are nevertheless unconvincing."1462 
                                                      
1452 Australia's first written submission, para. 388. 
1453 Ibid. 
1454 Australia's first written submission, paras. 363-376;  Australia's second written submission, 
paras. 330-337 and Annex 1. 
1455 Australia's first written submission, para. 401. 
1456 Australia's first written submission, para. 365. 
1457 Australia's second written submission, Annex 1, paras. 15-24. 
1458 Australia's first written submission, paras. 397 and 410. 
1459 Australia's first written submission, para. 389.  See also, Australia's first written submission, 
para. 407. 
1460 Australia's first written submission, para. 390.  See also, Australia's first written submission, 
para. 407. 
1461 Australia's first written submission, para. 391. 
1462 Australia's first written submission, para. 396.  Hale et al. , "Occurrence of Erwinia amylovora  on 
apple fruit in New Zealand" (1987), in Exhibit NZ-21;  Hale and Taylor, "Effect of Cool Storage on Survival of 
Erwinia amylovora  on Apple Calyxes" (1999), in Exhibit NZ-24;  van der Zwet et al., "Population of Erwinia 
amylovora  on External and Internal Apple Fruit Tissues" (1990), in Exhibit AUS-31;  McManus and Jones, 
"Detection of Erwinia amylovora  by nested PCR and PCR-Dot-Blot and Reverse-Blot Hybridizations" (1995), 
in Exhibit AUS-33;  and, Sholberg et al. , "Occurrence of Erwinia amylovora  of pome fruit in British Columbia 
in 1985 and its elimination from the apple surface" (1988) , in Exhibit AUS-34;  Hale and Clark, "Detection of 
Erwinia amylovora  from apple tissue by DNA hybridisation" (1990), in Exhibit AUS-35;  Roberts and Sawyer, 
"An updated pest risk a ssessment for spread of Erwinia amylovora  and fire blight via commercial apple fruit" 
(2008), in Exhibit NZ-29;  and, Ordax et al. , "Survival of Erwinia amylovora  in mature apple fruit calyces" 
(2008), in Exhibit AUS-36. WT/DS367/R 
Page 262  
 
 (ii) The Panel's analysis 
7.266  The IRA estimates the likelihood that pick ed fruit is infested or infected with Erwinia 
amylovora  as a triangular distribution with a minimum value of 10
-3 (1 in 1,000), a maximum value of 
5 × 10-2 (5 in 100) and a most likely value of 3 × 10-2 (3 in 100).1463 
7.267  The IRA notes that "there is a considerable amount of variation on the infestation rates 
reported. ... The IRA Team concluded that it w as appropriate to choose a value for Imp2 that 
adequately took into account the range of vari ation that was reported in this literature ..."1464 
7.268  The IRA also notes that the evaluation of this step takes into account that apples could be 
sourced from anywhere in New Zealand irrespective of  the fire blight status of orchards, including 
from orchards with active fire blight, orchards that  show few or no symptoms but are very close to 
active fire blight in hedgerow plants, or orchards  that show no symptoms and are some distance from 
an active fire blight host.  Because of the widespre ad distribution of fire blight in New Zealand, the 
IRA concludes that more weight should be given to  studies on apples sourced from orchards that were 
showing symptoms of fire blight disease.  The IRA acknowledges that certain studies found no evidence of fire blight bacteria on mature symp tomless apples and that some of these studies were 
carried out on orchards showing symptoms of fire blight.  However, the IRA points out that, "given 
that there are a number of studies that confirm the pre sence of fire blight bacteria on such fruit, studies 
that found no evidence of fire blight bacteria on mature symptomless apples were given much less 
weight [in the IRA]".
1465 
7.269  Consulted by the Panel, Dr Paulin noted that th e IRA's reasoning regarding infestation at this 
step, seems coherent and based on available eviden ce, "although it may tend to exaggerate the risks" 
of Erwinia amylovora  associated with mature symptomless fruits.1466  The same expert noted, 
however, that "this step, which deal s with epiphytically or surface-inf ested fruit, seems to me of quite 
low danger, because this population is low and easy to remove.  So that is why I think this step could 
be considered as low risk."1467 
7.270  Most of the scientific sources cited by the IRA seem respected and credible.1468  As noted by 
Dr Paulin, however, the van der Zwet et al. (1990) study should have been considered with extreme 
caution, in the light of the subsequent qua lifications made by its own first author.1469  In a declaration 
made in July 2002, Dr van der Zwet cautioned that the results of his 1990 study were obtained from fruit harvested in West Virginia, Unite d States, in a situation of severe fire blight.  In the view of that 
author, the results from the study "are not rele vant for purposes of setting quarantine measures on 
exported, mature fruit".
1470  Dr Paulin also noted that other data, such as in the paper from Sholberg 
                                                      
1463 Australia's IRA, Part B, pp. 55-65. 
1464 Australia's IRA, Part B, p. 65. 
1465 Ibid. 
1466 Dr Paulin's reply to Panel question 6, in List of  Replies from the scientific experts to questions 
posed by the Panel, in List of Replies from the scientific experts to questions posed by the Panel, para. 50.  See also, Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 346. 
1467 Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 271. 
1468 Dr Paulin's reply to Panel question 24, in List of Replies from the scientific experts to questions 
posed by the Panel, in List of Replies from the scientific experts to questions posed by the Panel, para. 175. 
1469 Declaration of Tom van der Zwet, 16 July 2002, in Exhibit AUS-32.  Van der Zwet et al ., 
"Population of Erwinia amylovora  on External and Internal Apple Fruit Tissues" (1990), in Exhibit AUS-31.  
Dr Paulin's reply to Panel question 24, in List of Replies from the scientific experts to questions posed by the 
Panel, para. 175.  But see, Aust ralia's IRA, Part B, pp. 63. 
1470 Declaration of Tom van der Zwet, 16 July 2002, p. 4, in Exhibit AUS-32.  Van der Zwet et al., 
"Population of Erwinia amylovora  on External and Internal Apple Fruit Tissues" (1990), in Exhibit AUS-31.  
Regarding the van der Zwet et al. (1990) study, see also, New Zealand's first written submission, para. 4.215;   WT/DS367/R 
 Page 263 
 
 
 et al.  (1988), which found an infestation/infection rate  of at least 33 per cent, should be considered 
with care as the paper seems to describe a specific case study, which may be different from the normal situation in an orchard devoted to export of apples.
1471 
7.271  The mechanisms described in the IRA for the survival of  Erwinia amylovora , such as 
exopolysaccharides (EPS), viable but non-culturable state (VBNC), quorum sensing, and sigma 
factors, show that E. amylovora  cells may survive in adverse cond itions, including on apples sourced 
from contaminated orchards.1472  The scientific data referenced by the IRA in this regard, however, 
does not allow a quantitative evaluation.1473  In any event, the data indicates that surviving populations 
are of low level, and that their capacity of resusc itation from VBNC to a culturable state is possible, 
but has not been demonstrated in natural conditions.  As noted by Dr Paulin, these surviving cells can 
be expected to be fewer if the apples are sourced  from orchards without active symptoms, if the 
apples are symptomless, and if no trashes are mixed with mature symptomless apples.1474  Dr Deckers 
noted additionally that, while the "most likely valu e" of 3 in 100 defined by the IRA may reflect a 
situation where active fire blight history is presen t, in cases where there is no new infection found in 
an orchard during one season, this le vel of bacteria would never be found.1475  In the words of this 
expert, "[the 'most likely value' defined by the IRA] seems to be a quite high rate of picked fruit being 
infected with [ Erwinia amylovora ].  I think there will be more a gradual distribution of presence of 
the fire blight bacteria on the fruits around the [ Erwinia amylovora ] infections present in the 
orchards."1476 
7.272  There is no adequate justification for the IRA's st atement that more weight should be given to 
studies on apples sourced from orchards that were showing symptoms of fire blight disease.1477  As 
noted by Dr Paulin, this statement does not seem to  take adequately into account that there is no 
indication that fire blight will be present at all ti mes, even in an infected orchard.  While it is 
reasonable to assume that no orchard in New Zealand is or has been permanently free of fire blight, that does not mean that all orchards will permanently show active symptoms.
1478  According to the 
evidence cited in the IRA, one year with Erwinia amylovora  infection may alternate with years with a 
much lower fire blight incidence;  even in an inf ected orchard, there may be years without fire blight 
symptoms.1479  Accordingly, as noted by Dr Paulin: 
"[I]t seems that orchards in New Zealand should be considered as a patchwork  of 
orchards with symptoms, and orchards showing no symptom.  Then I do not see why 
                                                                                                                                                                     
New Zealand's second written submission, para. 2.408-2.409;  and, Australia's first written submission, 
paras. 394-395. 
1471 Australia's IRA, Part B, pp. 56-57.  Dr Paulin's reply to Panel question 24, in List of Replies from 
the scientific experts to questions posed by the Panel, para. 175.  Sholberg et al., "Occurrence of Erwinia 
amylovora  of pome fruit in British Columbia  in 1985 and its elimination from  the apple surface" (1988), in 
Exhibit AUS-34. 
1472 Australia's IRA, Part B, pp. 57-61. 
1473 Dr Paulin's reply to Panel question 24, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 175 
1474 Dr Paulin's reply to Panel question 24, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 175. 
1475 Dr Deckers's reply in Transcript of the Panel's meeting with experts, para. 325. 
1476 Dr Deckers's reply to Panel question 24, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 173.  See also, Dr Deckers's reply in Transcript of the Panel's meeting with experts, 
para. 276. 
1477 Australia's IRA, Part B, p. 65. 
1478 Dr Paulin's reply to Panel question 25, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 177. 
1479 Dr Deckers's reply to Panel question 25, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 176.  See also, Dr Deckers's reply in Transcript of the Panel's meeting with experts, 
para. 323. WT/DS367/R 
Page 264  
 
 more weight should be given to one category (with symptom) only.  All the studies, 
weighted according to their own scientific value  should be considered with the same 
level of interest.  The exact fire blight s ituation of these orchards analysed in these 
papers and the relevance of the techniques used should be the criteria, if some of 
them were to be selected as more important than others."
1480 
7.273  Dr Paulin also noted that, because the "most lik ely value" proposed by the IRA (3 in 100) is 
high, this figure would be "amenable to experiment";  in other words, it would not have been beyond reach of experimentation by the IRA Team.
1481 
7.274  In any event, because of the wide variation in  the information reported in the various studies 
cited in the IRA, it is not possible to find jus tification from these studies for the probability range 
assigned to importation step 2 by the IRA.  The results of the various studies are not comparable, 
since the papers do not deal with the same type of  fruit (some deal with mature fruit, others with 
immature fruit, and still others do not indicate with  precision the type of fruit).  Additionally, each 
paper has its own technique of detection of the bact eria.  The range of frequenc ies of contamination of 
apples with Erwinia amylovora  indicated by Australia, from less than 1 per cent to 75 per cent 
indicate that these papers analysed different things in a different manner.1482  Consulted by the Panel, 
Dr Paulin noted that no general and r easonable conclusion for the presence of Erwinia amylovora  on 
or in mature apple fruit can be based on these disparate results.1483  Indeed, it is not clear from the IRA 
how the results of the different studies were aggreg ated in order to arrive at an estimation of a 
probability range for this importation step, nor the reasons why, in drawing this estimation, less 
weight was given to studies that found lower frequencies of contamination with fire blight.1484 
7.275  In conclusion, the Panel finds that the IRA' s estimation of the likelihood that fruit coming 
from an infected or infested orchar d is infected or infested with Erwinia amylovora  is not coherent 
and objective. 
(c) Alleged overestimation for importation step 3 
7.276  Importation step 3 represents the likelihood that cl ean fruit from infected or infested orchards 
is contaminated during picking and transport to the packing house.1485 
(i) Summary of the Parties' arguments 
7.277  Regarding importation step 3 for fire blight, New Zealand argues that the IRA's conclusion 
"has no basis in science.  It turns a negligible likelihood into a relatively high probability."1486  
New Zealand submits that it is generally acknowledged that any Erwinia amylovora  present on 
                                                      
1480 Dr Paulin's reply to Panel question 25, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 177 (original emphasis).  See also, Dr Sgrillo's reply to Panel question 25, in List of 
Replies from the scientific experts to questions posed by the Panel, para. 178 
1481 Dr Paulin's reply in Transcript of the Panel's meeting with experts, paras. 327 and 329. 
1482 Table 4 in Australia's first written submission, p. 140. 
1483 Dr Paulin's reply to Panel question 24, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 174.  See also, Dr Sgrillo's reply to Panel question 24, in List of Replies from the scientific experts to questions posed by the Panel, paras. 170-172. 
1484 Dr Paulin's reply to Panel question 24, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 174;  Dr Paulin's reply in Tran script of the Panel's meeting with experts, para. 321.  
See also, Dr Sgrillo's reply to Panel question 24, in List of Replies from the scientific experts to questions posed 
by the Panel, paras. 170-172. 
1485 Australia's IRA, Part B, pp. 19-21. 
1486 New Zealand's first written submission, para. 4. 221.  See also, New Z ealand's second written 
submission, paras. 2.418-2.421.  WT/DS367/R 
 Page 265 
 
 
 mature apples at harvest would most likely be on th e calyx and thus not available to contaminate other 
apples.  Additionally, populations of E. amylovora  reported on mature fruit, even from severely 
infected orchards, have been zero or epidemiologically  insignificant.  Therefore contamination, if it 
occurred, would only have the effect of further diluting already small populations.1487 
7.278  New Zealand concludes that the likelihood of contamination by Erwinia amylovora  during 
picking and transportation to a packing house is ne gligible and the probability value assigned in the 
IRA is incorrect.  This is an event that would almost certainly not occur.1488 
7.279  In response, Australia contends that New Z ealand's assertions regarding importation step 3 
"are without merit".1489  Australia argues that "New Zealand fails to appreciate the range in the 
scientific data available in respect of the probability of  particular events occurr ing, with the result that 
it seeks to limit a probability distribution to a single figure."1490 
7.280  Regarding New Zealand's argument that any Erwinia amylovora  would most likely be on the 
calyx, Australia notes that importation step 3 is not focussed on bacteria from the calyx as a direct source of contamination, but rather "surface infestation and E. amylovora on leaves, in the orchard 
environment, on the hands of pickers and on bins and machinery".
1491 
7.281  Australia adds that, although Erwinia amylovora  does not multiply on dry surfaces exposed to 
sunlight, "it clearly has the capacity to survive in  the environment quite well, rapidly multiplying and 
infecting wounds on apples when conditions are favourable".1492 
7.282  Australia notes that, as acknowledged by the IR A, the likelihood of contamination arising 
from sources such as ooze on trees, hands of pickers, picking bags, bins or machinery is "very small" 
and the likelihood of transfer is "even lower".1493  Australia submits, however that "[t]his is why the 
probability range assigned by the IRA Team is skew ed to the lower end of the distribution.  
New Zealand has provided no argument as to why th e IRA Team's use of such a range, designed 
specifically to reflect the low probability of c ontamination, should be considered flawed."1494 
(ii) The Panel's analysis 
7.283  The IRA estimates the likelihood that  clean fruit is contaminated by Erwinia amylovora  
during picking and transport to the packing house as a triangular distribution with a minimum value of 
10-3 (1 in 1,000), a maximum value of 3 × 10-2 (3 in 100) and a most likely value of 10-2 (1 in 100).1495 
7.284  According to the IRA, "[t]his range allows for fruit to be infected at picking through wounds 
as well as surface contamination that may occur by c ontact with contaminated bins, pickers' hands, 
leaves, twigs, etc in the event that rain occurs during harvest."1496 
7.285  The values for the distribution were taken by  the IRA from two papers:  van der Zwet et al.  
(1990) and Hetzroni et al.  (2004).1497  In the first study, 3 out of 72 (4 per cent) uninoculated and non-
                                                      
1487 New Zealand's first writte n submission, para. 4.223. 
1488 New Zealand's first writte n submission, para. 4.224. 
1489 Australia's first written submission, para. 388.  See also, Australia's second written submission, 
paras. 375-377. 
1490 Australia's first written submissi on, para. 413 (original emphasis). 
1491 Australia's first written submission, para. 415. 
1492 Australia's first written submission, para. 417. 
1493 Australia's first written submission, para. 418.  Australia's IRA, Part B, p. 69. 
1494 Australia's first written submission, para. 418. 
1495 Australia's IRA, Part B, pp. 65-71. 
1496 Australia's IRA, Part B, p. 71. WT/DS367/R 
Page 266  
 
 disinfested fruit developed blight symptoms;  all through injury through puncture treatment.
1498  The 
IRA states that this infection presumably took place "through epiphytic bacteria being present on the surface.  The 4% infection rate therefore occurs when 100% of the fruit is wounded."
1499  From this 
study, the IRA concludes that 4 per cent of the fruit damaged would be infected with fire blight.  As 
suggested by Dr Sgrillo, however, the reliability of the van der Zwet et al.  study and the 
appropriateness of using it as a basis for the IRA' s estimations may be limited, because the sample 
size was very small, the variability was not assessed a nd the results may be valid only for artificially 
injured fruits.1500 
7.286  Dr Sgrillo also suggests that the second paper should be considered with care, as it is only a 
four-paragraph abstract with few details about the me thodology and analysis of the results of a study.  
According to the IRA, Hetzroni et al.  (2004) provides "some information on the percentages of apples 
wounded or bruised during picking and transport."1501  The IRA notes that "[t]he percentage of 
damage was lowest (8%) for the careful picking treatment compared with 37% in the whole container in the packing house."
1502  This abstract, however, contains no specification of how samples were 
collected, what methodology was used, and no statistical analysis.1503 
7.287  The IRA then used the 4 per cent contamination figure obtained from van der Zwet et al.  
(1990) multiplied by the 37 per cent damage figure obtained from Hetzroni et al.  (2004), to indicate 
the magnitude of the most likely value of the triangular distribution, 1 per cent. 
7.288  The experts consulted by the Panel expressed doubts regarding the reliability of the one per 
cent figure and the IRA's underlying assumptions.  One of the experts noted that such contamination 
during picking and transportation would only be possi ble in extreme cases, "when the harvest takes 
place in a heavy infected orchard during rainy circum stances".  He noted, however, that "the overall 
chance of 1% seems to be rather high when the fire  blight infections are only sporadically present in 
an orchard."1504  The 1 per cent figure would not be realistic , because when present in an orchard fire 
blight will not be uniformly distributed.1505  Another expert agreed that "the evaluation of risk for this 
step seems too high, for mature symptomless fruits".1506  The experts noted that some of the 
experiments cited by the IRA describe the initiati on of infections, when bacteria is introduced 
artificially at the proper site of the suitable fru it, in optimal conditions for the disease.  These 
experiments, however, would give "very few useful  indications for the description of events taking 
place in natural conditions", especially because Erwinia amylovora  is not able to multiply on plant 
                                                                                                                                                                     
1497 Australia's IRA, Part B, p. 71.  See, van der Zwet et al ., "Population of Erwinia amylovora  on 
External and Internal Apple Fruit Tissues" (1990), in Exhibit AUS-31;  and, Hetzroni et al. , "Mechanical 
injuries in apples" (2004). 
1498 Van der Zwet et al ., "Population of Erwinia amylovora  on External and Internal Apple Fruit 
Tissues" (1990), in Exhibit AUS-31. 
1499 Australia's IRA, Part B, p. 70.  See, Van der Zwet et al., "Population of Erwinia amylovora  on 
External and Internal Apple Fruit Tissues" (1990), in Exhibit AUS-31. 
1500 See, Dr Sgrillo's reply to Panel question 26, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 180. 
1501 Australia's IRA, Part B, p. 70.  See, Hetzroni et al. , "Mechanical injuries in apples" (2004). 
1502 Australia's IRA, Part B, p. 70. 
1503 Dr Sgrillo's reply to Panel question 26, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 181-182;  Dr Sgrillo's reply in Transcript of  the Panel's meeting with experts, 
para. 280. 
1504 Dr Deckers's reply to Panel question 26, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 186.  See also, Dr Deckers's reply to Panel question 27, in List of Replies from the 
scientific experts to questions posed by the Panel, para. 189. 
1505 Dr Deckers's reply in Transcript of the Panel's meeting with experts, para. 335. 
1506 Dr Paulin's reply to Panel question 26, para. 188 in Replies from the scientific experts to questions 
posed by the Panel.  See also, Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 333.  WT/DS367/R 
 Page 267 
 
 
 surfaces, making it "difficult to imagine conditions  conducive to actively growing cells in natural 
conditions on the surface of a symptomless apple... [or the] spread of surface population from fruit to 
infection sites".1507 
7.289  The IRA's estimation of this particular importati on step is based on some scientific evidence.  
The two studies on which the calculation of the probab ility range and the most likely value are based, 
however, have important limitations, mainly because of the small sample size in the first paper and 
the lack of information on the methodology and on the details of the results of the second paper.  In 
such conditions, these studies cannot constitute an adequate scientific basis for a coherent and 
objective analysis.1508 
7.290  In conclusion, the Panel finds that the IRA's estimation of the likelihood that clean fruit from 
infected or infested orchards is contaminated with Erwinia amylovora  during picking and transport to 
the packing house does not rely on adequate scientific  evidence and, accordingly, is not coherent and 
objective. 
(d) Alleged overestimation for importation step 4 
7.291  Importation step 4 represents the likelihood that in fected or infested fru it remains infected or 
infested after routine processing procedures in the packing house.1509 
(i) Summary of the Parties' arguments 
7.292  Regarding importation step 4 for fire blight, Ne w Zealand argues that the IRA's analysis of 
this step "is based on an assumption rather than on  scientific data" and that "[t]he likelihood of 
arriving at this step is ... negligible."1510  According to New Zealand, there will be insufficient bacteria 
to initiate an infection at this stage.1511 
7.293  New Zealand also submits that the IRA "ignores th e impact that cold storage would have" on 
epiphytic infestations.  In New Zealand's view, th e scientific literature strongly indicates that cold 
storage at this stage would have a negative influence on the survival of Erwinia amylovora on apple 
fruit.1512 
7.294  New Zealand concludes that "the proposition that the limited numbers of E. amylovora  likely 
to be present on apple fruit at harvest would su rvive normal processing procedures is a step that 
should have been treated as an event with a much lower probability."1513 
                                                      
1507 Dr Paulin's reply to Panel question 27, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 190-191. 
1508 See, for example, Dr Sgrillo's reply to Panel qu estion 26, in List of Replies from the scientific 
experts to questions posed by the Panel, para. 179-185;  Dr  Sgrillo's reply in Transcript of the Panel's meeting 
with experts, para. 280. 
1509 Australia's IRA, Part B, pp. 19-21. 
1510 New Zealand's first writte n submission, para. 4.225. 
1511 New Zealand's first written submission, para. 4. 227.  See also, New Z ealand's second written 
submission, paras. 2.422-2.423. 
1512 New Zealand's first written submission, para. 4.226.  See, Hale and Taylor, "Effect of Cool Storage 
on Survival of Erwinia amylovora  on Apple Calyxes" (1999), in Exhibit NZ-24;  Taylor and Hale, "Cold storage 
affects survival and growth of Erwinia amylovora  on the calyx of apple" (2003), in Exhibit NZ-25;  and, Temple 
et al. , "Evaluation of Likelihood of Co-Occurrence of Erwinia amylovora  with Mature Fruit of Winter Pear" 
(2007), in Exhibit NZ-98. 
1513 New Zealand's first writte n submission, para. 4.227. WT/DS367/R 
Page 268  
 
 7.295  In response, Australia contends that the "the  probability range assigne d to Importation step 4 
cannot be reduced to a mere 'assumption'."
1514  Australia argues in this regard that the scientific 
literature indicates that, while the number of Erwinia amylovora  on or in apples declines with cold 
storage, it also shows that they do not disappear.1515  In Australia's words, "[g]iven the risk scenario 
addressed by the IRA Team, E. amylovora  will be taken to have survived this step even if only one 
bacterium survives routine pack hou se procedures on any given apple."1516 
7.296  Australia also argues that, in its first writte n submission, New Zealand only argued that the 
distribution range for this importation step should be revised purely on the basis that there is some evidence which shows that cold storage h as a negative impact on the survival of Erwinia amylovora .  
Accordingly, New Zealand should not be permitted to  expand its claims in relation to these issues (for 
example, concerning the effects of brushing, waxing,  sorting and grading and packaging as considered 
by the IRA) at a later stage of the proceedings.
1517 
7.297  Australia concludes that "New Zealand has fail ed to show that the probability range assigned 
to Importation step 4 is flawed".1518 
(ii) The Panel's analysis 
7.298  The IRA estimates the likelihood that Erwinia amylovora  survives routine processing 
procedures in the packing house as a triangular distri bution with a minimum value of 0.3 (30 in 100), 
a maximum value of 0.7 (70 in 100) and a most likely value of 0.65 (65 in 100).1519 
7.299  According to the IRA: 
"None of the processes undertaken at this stage [routine procedures that occur in 
New Zealand packing houses, such as pre-cooling, washing, disinfection, brushing, 
waxing, sorting and grading, packaging and cold storage] would have a large 
influence on the survival of E. amylovora on apple fruit.  However, depending on 
individual packing house procedures some reduction in the number of fruit carrying bacteria would be expected because of fact ors such as the use of disinfectants and 
grading out of damaged fruit."
1520 
7.300  As noted in the arguments section above, most of the discussion between the Parties regarding 
New Zealand's argument on the IRA's estimations on importation step 4 for fire blight focus on the issue of whether cold storage would significantly re duce the amount of bacteria on apples to the point 
where they would be insufficient to initiate an infection. 
7.301  Most of the evidence cited in the IRA supports the notion that cold storage would reduce the 
bacterial population of Erwinia amylovora on apples, but would not completely eliminate such 
population.  As noted by Dr Paulin: 
                                                     
 
1514 Australia's first written submission, para. 426. 
1515 Australia's first written submission, para. 422;  Australia's second written submission, para. 379.  
See, Hale and Taylor, "Effect of  Cool Storage on Survival of Erwinia amylovora  on Apple Calyxes" (1999), in 
Exhibit NZ-24;  Temple et al. , "Evaluation of Likelihood of Co-Occurrence of Erwinia amylovora  with Mature 
Fruit of Winter Pear" (2007), in Exhibit NZ-98;  and, Ordax et al. , "Survival of Erwinia amylovora  in mature 
apple fruit calyces" (2008 ), in Exhibit AUS-36. 
1516 Australia's first written submission, para. 421. 
1517 Australia's first written submission, para. 420;  Australia's second written submission, paras. 378 
and 380. 
1518 Australia's first written submission, para. 426.  Australia's second written submission, para. 384. 
1519 Australia's IRA, Part B, pp. 71-77. 
1520 Australia's IRA, Part B, pp. 76-77.  WT/DS367/R 
 Page 269 
 
 
 "Data on preservation of bacterial population on apple surface during cold storage 
seems to accurately show that there is a decrease in these conditions.  It is not 
possible to know if this decrease is linked w ith temperature, or only with time ... [I]n 
the precise case of risk of transport of bacteria with mature symptomless fruits anyhow, this has little influence:  the cond itions in the packing house will not allow 
the population to increase, but will not allow the population to disappear within the 
considered period of time."
1521 
7.302  Some of the experts consulted by the Panel refe rred to the possible impact that disinfection, a 
routine procedure in the packing house different fro m cold storage, could have on the survival of 
epiphytic populations of Erwinia amylovora on apples.  According to Dr Paulin, "if a disinfectant step 
is included in the process, the decrease of the leve l of bacterial population can be expected to be 
sharp".1522  Dr Paulin added that "in the case of fruit disinfection, the probability range and pattern 
distribution ... seems too high for this step.  This  applies for mature symptomless apples, but would 
not be different for trashes associated with fruits."1523  Dr Deckers concurred and noted that "[t]he 
disinfection process during packaging should reduce th e risk of survival of the epiphytic population 
strongly and reduce the distribution pattern substa ntially.  But a total removal of the bacterial 
population will not be an easy task".1524 
7.303  Evidence cited by the IRA confirms that disinfection can have a significant impact in 
reducing bacterial population: 
"Toivonen et al. (2001) showed that sodium  hypochlorite ... or peroxyacetic acid ... 
was fully effective in eliminating micro-orga nisms from the surface of apples.  They 
showed that peroxyacetic acid eliminated microbes from the calyx while sodium 
hypochlorite did not, and that it was difficult to remove or kill micro-organisms present in the stem-end of the fruit using both chemicals. ... [Infested n]aturally-contaminated mature apples ... when treated with 100 μg per mL of chlorine were not 
effectively sanitised, because chlorine did no t reach bacteria in the protected calyx 
cavity (Sholberg et al., 1988) probably b ecause of formation of air pockets.  
However, a 10 min dip in a solution of [acetic acid and propionic acid] was effective in completely eliminating bacteria from fruit inoculated with ... E. amylovora by 
spraying.  Dueck (1974b) also observed that when E. amylovora suspended in 
distilled water ... was artificially inoculated  by swabbing on apples, bacterial numbers 
were reduced but not completely eliminated by chlorine.  However, a 10 minute dip 
in ... acetic acid completely eliminated E. amylovora from the fruit surface.  
Janisiewicz and van der Zwet (1988) reporte d that ... sodium hypochlorite in vitro 
totally eradicated E. amylovora in 5 minutes, but, with addition of a surfactant ..., the 
amount of sodium hypochlorite required to totally eliminate bacteria in 5 minutes increased .... However, Janisiewicz and van der Zwet (1988) showed that when 
artificially inoculated ... apple fruit was treated with ... sodium hypochlorite plus ... 
surfactant, E. amylovora was reduced but not completely killed. 
                                                     
 
1521 Dr Paulin's reply to Panel question 29, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 209.  See also, Dr Deckers's and Dr Paulin's replies to Panel questions 14 and 29, in 
List of Replies from the scientific experts to questions posed by the Panel, paras. 115 and 208. 
1522 Dr Paulin's reply to Panel question 28, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 206.  See also, Dr Paulin's reply to Panel question 28, in List of Replies from the 
scientific experts to questions posed by the Panel, paras. 20 5-207.  But see, Dr Paulin's reply in Transcript of the 
Panel's meeting with experts, para. 286. 
1523 Dr Paulin's reply to Panel question 28, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 206-207. 
1524 Dr Deckers's reply to Panel question 28, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 204. WT/DS367/R 
Page 270  
 
 Roberts and Reymond (1989) artificially i noculated mature apple fruit with 
E. amylovora aerosol solutions ... and immersed fruit in different  concentrations ... of 
sodium hypochlorite or ... acetic acid.  The  reduction in the E. amylovora population 
averaged 6 to 7 log units less than the number  applied to the fruit, but significant 
differences between treatments were not observed.  Roberts  and Reymond (1989) 
also reported that ... citrate buffer was effective against  E. amylovora but because of 
its incompatibility with sodium hypochlorite, this could not be  used in the dump tank.  
These authors reported that treatment with ... sodium  hypochlorite in ... 
dodecylbenzenesulphonic acid (DBSA) for 10 min significantly  reduced 
E. amylovora on apple fruit.  These reports indicate that chlorine at different  
concentrations is effective in reducing but not eliminating the bacterial population.  
However,  it can be an effective component in systems approaches which integrate 
different management  measures."
1525 
7.304  Accordingly, with respect to disinfection, the evidence cited by the IRA does not seem to 
support the general conclusion that "[n]one of the processes undertaken [i n New Zealand packing 
houses] would have a large influence on the survival of E. amylovora on apple fruit".1526  However, 
the IRA also notes that "depending on individual packing house procedures some reduction in the number of fruit carrying bacteria would be exp ected because of factors such as the use of 
disinfectants..."
1527  Dr Deckers noted in this regard that, when considering disinfection of the fruit, 
"we should be aware that we never take away 100 per cen t of the bacteria present.  It is very difficult 
to disinfect for 100 per cent in the calyx area."1528 
7.305  In the light of the above, the IRA contains  sufficient scientific evidence to support its 
conclusion that routine procedures that occur in New Zealand packing houses may reduce the 
bacterial population on apple fruit, but would not tota lly eliminate bacteria.  The experts consulted by 
the Panel agreed with this general conclusion, a lthough some considered that the probability range 
and pattern distribution estimated by the IRA for th is importation step seems too high, particularly 
considering the possible effect of the use of disinfectants.1529  In any event, New Zealand has not 
successfully shown that cold storage would significantly limit the amount of bacteria on apples to the point where they would be insufficient to initiate an infection. 
7.306  Accordingly, the Panel concludes that New Z ealand has not made a case that the IRA's 
estimation of the likelihood that Erwinia amylovora  survives routine processing procedures in the 
packing house is exaggerated and does not rely on adequate scientific evidence. 
(e) Alleged overestimation for importation step 5 
7.307  Importation step 5 represents the likelihood that clean fruit is contaminated during processing 
in the packing house.
1530 
                                                      
1525 Australia's IRA, Part B, pp. 72-73. 
1526 Australia's IRA, Part B, p. 76. 
1527 Australia's IRA, Part B, pp. 76-77.  As noted in the discussion of importation step 5, the IRA notes 
that only about half of New Zealand packing houses use some type of disinfectant in the dump tanks.  See 
para. 7.314 below.  Australia's IRA, Part B, pp. 77 
1528 Dr Deckers's reply in Transcript of the Panel's meeting with experts, para. 288. 
1529 See, for example, Dr Paulin's reply to Panel qu estion 28, in List of Replies from the scientific 
experts to questions posed by the Panel, paras. 205-207.  See also, Dr Sgrillo's reply to Panel question 28, in List 
of Replies from the scientific experts to questions posed by the Panel, paras. 192-196 and 202-203;  Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 286. 
1530 Australia's IRA, Part B, pp. 19-21.  WT/DS367/R 
 Page 271 
 
 
 (i) Summary of the Parties' arguments 
7.308  Regarding importation step 5 for fire blight, Ne w Zealand submits that the scientific evidence 
indicates that the likelihood of mature apples contaminating clean fruit during processing in the packing house is negligible.
1531 
7.309  In response, Australia contends that New Zealand has misunderstood the intention of 
importation step 5, and how the importation steps op erate together.  Consequently, Australia argues 
that New Zealand fails to establish why the IRA's judgement in relation to importation step 5 should 
be considered flawed.1532 
7.310  With respect to this step, Aust ralia argues that the IRA considered that the most significant 
source of fruit contamination in the packing house is the water in the dump tank and the wash water 
that apples may be exposed to th rough the grading and packing process.1533  Australia notes that the 
IRA took into account that only 53 per cent of New Zealand packing houses use some sort of disinfectant in the process water.
1534 
(ii) The Panel's analysis 
7.311  The IRA estimates the likelihood that  clean fruit is contaminated by Erwinia amylovora  
during processing in the packing house as a triangular distribution with a minimum value of 10-3 (1 
in 1,000), a maximum value of 5 × 10-2 (5 in 100) and a most likely value of 2.5 × 10-2 (2.5 in 100).1535 
7.312  According to the IRA: 
"This conclusion was based on the potential for the fruit dump tank to become 
contaminated by bacteria and the fact that disinfection of the dump tank water is not a 
routine practice in a significant number of New Zealand packing houses.  This also 
takes into account that unrestricted risk  is being assessed and therefore fruit from 
orchards with active symptoms could be carry ing bacteria that wash off into the dump 
tanks."1536 
7.313  The IRA notes that "[a]ny bacteria present on fruit, trash (leaves and twigs), harvesting bins 
and soil adhering to bottom of bins may get into  the dump tank and potentially contaminate clean 
fruit".1537  Notwithstanding the above, the evidence cited in the IRA indicates that "there will be a 
very high dilution factor in the dump tank water.  There are also indications that E. amylovora  has 
difficulty surviving in water."1538 
7.314  As stated by Australia, the IRA notes that 53 per cent of New Zealand apple packing houses 
use some sort of disinfectant in the process water:  37 per cent use chlorine in the dump tanks, with an 
additional 16 per cent using an alternative such as peroxyacetic acid or bromo-chloro-
dimethylhydantoin.1539  The IRA notes further that 73 per cent of New Zealand apple packing houses 
                                                      
1531 New Zealand's first written submission, para. 4. 228;  New Zealand's se cond written submission, 
para. 2.426. 
1532 Australia's first written submission, para. 429. 
1533 Australia's first written submission, para. 427;  Australia's second written submission, para. 386. 
1534 Australia's first written submission, para. 427. 
1535 Australia's IRA, Part B, pp. 77-79. 
1536 Australia's IRA, Part B, pp. 78-79. 
1537 Australia's IRA, Part B, pp. 77. 
1538 Australia's IRA, Part B, pp. 77.  Crosse et al. , "Leaf damage as a predisposing factor in the 
infection of apple shoots by Erwinia amylovora " (1972). 
1539 Australia's IRA, Part B, pp. 77. WT/DS367/R 
Page 272  
 
 use high-pressure and high-volume washing with jets of clean water to rinse apples after washing in 
the dump tank, which would likely remove any surface contamination of clean fruit with bacteria or 
trash.
1540 
7.315  As stated in the IRA: 
"Ceroni et al. (2004) immersed pear fruit for 15 min in a suspension of E. amylovora 
with 108 cfu/mL and could not detect bacter ia on the surface after just a few days, 
with small  numbers remaining for longer periods only in the calyx.  These authors 
concluded that  bacterial survival on the fruit surface is very short and has a negligible 
epidemiological role.  If E. amylovora gets into the core in the dump tank, one would 
expect some internal infection  to develop but this has neve r been reported.  Sapers 
(1999) carried out some apple washing  trials in a commercial cider mill and found 
that for apples inoculated by dipping in E. coli solutions, bacteria were not washed 
out into the dump tank, the dump tank water did not get  contaminated and no cross 
contamination took place in the dump tank.  This behaviour of  E. coli is different to 
E. amylovora, which has been shown in several studies to be easily  washed from 
contaminated surfaces.  This clearly demonstrates the differing behaviours of the  two 
bacteria and the dangers of extrapolating from one to the other.  In contrast to 
observations of Sapers (1999) for E. coli , we have concluded that a very small level 
of cross  contamination as infestation in the dump tank may be possible for 
E. amylovora ."1541 
7.316  The IRA notes that, compared to the dump tank, th e rest of the packing line is considered to 
be a less significant contamination source.1542 
7.317  The IRA reaches the conclusion, on the basis of the evidence cited, that  there is a possibility 
that a small level of cross contamination of apples by Erwinia amylovora  may occur in the fruit dump 
tank.  The evidence cited by the IRA, however, indicates that the liquid medium in which mature apple fruits are immersed during processing in the pack ing house, even without disinfectant, is a poor 
culture medium for  Erwinia amylovora .  The evidence also suggests that such liquid medium would 
have a dilution effect.
1543 
7.318  Dr Paulin found the IRA's estimation regard ing this importation step to be strongly 
exaggerated.1544  In the words of Dr Paulin, "[o]nly if decaying apples (s upposedly decaying from 
E. amylovora  infection – then immature and not "symptomless") or large amount of infected trashes, 
were present, the dilution effect in a non-disinfectant medium could lead to a significant amount of 
bacterial cells on fruit surfaces.  This seem s very unlikely in practical conditions."1545  As noted by 
Dr Deckers, the scientific eviden ce indicates that the likelihood that contamination of clean apples 
                                                      
1540 Australia's IRA, Part B, pp. 77 . 
1541 Australia's IRA, Part B, pp. 78.  Ceroni et al. , "Survival of Erwinia amylovora  on pears and on fruit 
containers in cold storage and outdoors" (2004);  Sapers, "Research on decontamination of apples by washing with detergents and sanitizing agents" (1999). 
1542 Australia's IRA, Part B, pp. 77. 
1543 Dr Paulin's reply to Panel question 30, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 216. 
1544 Dr Paulin's reply to Panel question 30, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 216;  Dr Paulin's reply in Tran script of the Panel's meeting with experts, para. 341.  
See also, Dr Sgrillo's reply to Panel question 30, in List of Replies from the scientific experts to questions posed 
by the Panel, paras. 211-214. 
1545 Dr Paulin's reply to Panel question 30, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 216-217.  See also, Dr Deckers's reply in Transcript of the Panel's meeting with 
experts, para. 362;  Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 360.  WT/DS367/R 
 Page 273 
 
 
 happens during processing is negligible when  the water during processing is disinfected.1546  In this 
regard, the IRA does not properly explain its reasons  for seemingly disregarding the conclusions of 
studies such as Ceroni et al.  (2004) and the Sapers (1999) study for E. coli1547 when deducing its 
estimates of likelihood for this importation step. 
7.319  Dr Paulin noted further that, even in the latte r case, the scientific evidence is that, in an 
artificial medium, Erwinia amylovora  would not compete successfully  against natural antagonistic 
bacteria (such as Pantoea agglomerans  or Pseudomonas fluorescens ).  These natural antagonistic 
bacteria are naturally found in high concentrati on on plant and on fruit surfaces, and would prevent a 
multiplication of Erwinia amylovora , if present.1548 
7.320  The IRA contains sufficient evidence from respect ed and qualified sources with respect to its 
consideration of this importation step.  There is no indication in the IRA, however, of how the results 
of these scientific studies were were taken into account  in arriving at an estimation of a probability 
range for this importation step.  There is, for exam ple, no indication of how the IRA took into account 
the evidence regarding the potential for the fruit dump tank to become contaminated by Erwinia 
amylovora  bacteria and to become a contamination source for clean fruit during processing in the 
packing house.  Accordingly, the Panel finds that  the IRA's estimation of the likelihood that clean 
fruit is contaminated by Erwinia amylovora  during processing in the packing house is not coherent 
and objective. 
(f) Alleged overestimation for importation step 6 
7.321  Importation step 6 represents the likelihood that in fected or infested fru it remains infected or 
infested during palletization, quality inspection, containerization and transportation to Australia.1549 
(i) Summary of the Parties' arguments 
7.322  New Zealand submits that the IRA has attribut ed an inflated likelihood in its calculations 
regarding importation step 6 for fire blight.1550  In its view, "[t]he IRA does not take account of the 
fact that containerisation and transportation involves cold storage which significantly reduces the viability of  E. amylovora ."
1551 
7.323  New Zealand states that the fact that it is possible for bacteria to survive the time and 
conditions of transit does not imply they will su rvive in epidemiologically significant numbers.1552  
"[I]n rejecting the concept of an epidemiologica lly significant number of bacteria, Australia also 
                                                      
1546 Dr Deckers's reply to Panel question 30, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 215. 
1547 Ceroni et al. , "Survival of Erwinia amylovora  on pears and on fruit containers in cold storage and 
outdoors" (2004);  Sapers, "Research on decontamination of apples by washing with detergents and sanitizing 
agents" (1999).  Australia's IRA, Part B, pp. 78. 
1548 Dr Paulin's reply to Panel question 30, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 216-217. 
1549 Australia's IRA, Part B, pp. 19-21. 
1550 New Zealand's first writte n submission, para. 4.231. 
1551 New Zealand's first written submission, para. 4.229.  Hale and Taylor, "Effect of Cool Storage on 
Survival of Erwinia amylovora  on Apple Calyxes" (1999), in Exhibit NZ-24;  Taylor and Hale, "Cold storage 
affects survival and growth of Erwinia amylovora  on the calyx of apple" (2003), in Exhibit NZ-25;  and, Temple 
et al. , "Evaluation of Likelihood of Co-Occurrence of Erwinia amylovora  with Mature Fruit of Winter Pear" 
(2007), in Exhibit NZ-98. 
1552 New Zealand's first writte n submission, para. 4.229. WT/DS367/R 
Page 274  
 
 rejects the notion that there is a significant diffe rence between the potential risk associated with the 
presence of one bacterium on an apple and the presence of 10,000 bacteria."
1553 
7.324  In response, Australia contends that New Z ealand has failed to establish that the IRA's 
assessment of importation step 6 is flawed.1554  In its view, "New Zealand ... fails to demonstrate a 
proper understanding of the importation scenario exam ined by the IRA Team.  Much of the evidence 
presented [by New Zealand] in fact supports Australi a's claim that the IRA Team was correct in its 
assessment of likelihood for Importation step 6."1555 
7.325  Australia argues in this regard that the IRA t ook into account the fact that bacteria are not 
visible and the evidence presented for importation step  4 that bacteria will survive cold storage 
conditions.1556  While scientific evidence demonstrates that b acteria decline in cold storage, the same 
evidence also demonstrates that some bacteria can survive.  Australia submits that the discussion in 
this regard in the context of importation st ep 4 applies equally to importation step 6.1557  Australia 
emphasizes that importation step 6 does not test whether Erwinia amylovora  will survive in 
epidemiologically significant numbers.  "It is concerned with the likelihood that any bacteria will 
survive quality controls, storage and transport."1558  In the light of this, the IRA Team concluded that 
none of the processes at importation step 6 are likely to directly impact on the survival of Erwinia 
amylovora  on fruit.1559 
(ii) The Panel's analysis 
7.326  The IRA estimates the likelihood that Erwinia amylovora  survives palletization, quality 
inspection, containerization and transportation to  Australia as a triangular distribution with a 
minimum value of 0.7 (70 in 100), a maximum value of 1 (100 in 100) and a most likely value of 0.8 
(80 in 100).1560 
7.327  The IRA notes that "[b]acteria are not visible and will survive quality inspection and 
palletisation."1561  Transportation of apple fruit in contai ners from New Zealand to Australia would 
take a minimum of 10 days.  The IRA cites evid ence that, although some reduction in numbers of 
bacteria and number of infested fruit would be expe cted during transportation of apples in containers 
from New Zealand to Australia, bacteria can surv ive on fruit for periods longer than 10 days.1562 
7.328  As noted in the arguments section above, the discussion between the Parties regarding the 
IRA's estimations on importation step 6 for fire bli ght replicates the earlier di scussion on cold storage 
in the context of importation step 4.  Again, a ma in point of contention between the Parties is the 
extent to which cold storage would limit the amount of  bacteria on apples.  An important difference in 
the discussion of these two importation steps is that disinfection procedures, which can have a 
significant impact in reducing bacterial populatio n, are not relevant for importation step 6. 
                                                      
1553 New Zealand's second writte n submission, para. 2.428. 
1554 Australia's first written submission, para. 437;  Australia's second written submission, para. 391. 
1555 Australia's first written submission, para. 437. 
1556 Australia's first written submission, para. 430. 
1557 Australia's first written submission, para. 433;  Australia's second written submission, para. 390. 
1558 Australia's first written submission, para. 433. 
1559 Australia's first written submission, para. 430. 
1560 Australia's IRA, Part B, p. 79. 
1561 Ibid. 
1562 Australia's IRA, Part B, p. 79.  Ceroni et al. , "Survival of Erwinia amylovora  on pears and on fruit 
containers in cold storage and outdoors" (2004);  Hale and Taylor, "Effect of Cool Storage on Survival of 
Erwinia amylovora  on Apple Calyxes" (1999), in Exhibit NZ-24.  WT/DS367/R 
 Page 275 
 
 
 7.329  The Panel has already noted that most of th e evidence cited in the IRA supports the notion 
that cold storage would reduce the bacterial population of Erwinia amylovora on apples, but would 
not completely eliminate such population.1563 
7.330  In the light of the above, the IRA contains  sufficient scientific evidence to support its 
conclusion that, although some reduc tion in numbers of bacteria and number of infested fruit would 
be expected during transportation of apples in cont ainers from New Zealand to Australia, bacteria can 
survive on fruit for periods longer than 10 days.  The experts consulted by the Panel agreed with this 
general conclusion, although Dr Deckers noted that "[t]he survival of the [ Erwinia amylovora ] 
bacteria during palletization, containerization and tran sport is considered to be low, surely after the 
external disinfection of the fru its during the packaging process".1564  In any event, New Zealand has 
not successfully shown that cold storage occurring during containerization and transportation at this 
stage would significantly reduce the viability of  Erwinia amylovora . 
7.331  Accordingly, the Panel concludes that New Z ealand has not made a case that the IRA's 
estimation of the likelihood that Erwinia amylovora  survives palletization, quality inspection, 
containerization and transportation to Australia is in flated or that it is not based on a coherent and 
objective reasoning. 
(g) Alleged overestimation for importation step 7 
7.332  Regarding the pests reviewed in the IRA, im portation step 7 represents the likelihood that 
clean fruit will become contaminated during palleti zation, quality inspection, containerization and 
transportation.1565 
(i) Summary of the Parties' arguments 
7.333  New Zealand submits that "[t]his is another ev ent with an exceedingly small probability of 
occurrence."1566  New Zealand argues that "[t]his step is a further reiteration of steps 3 and 5, the 
assumption that clean fruit can become contaminated with E. amylovora during the process from 
picking to arrival at its export destination.  Just as the assumptions behind steps 3 and 5 are unsupportable, equally step 7 is without support."
1567 
7.334  New Zealand argues that this is "another exampl e of Australia using a probability range with 
a maximum value that is not justified by the scientific  evidence, with the effect of inflating the overall 
probability of entry, establishment and spread".1568 
7.335  In response, Australia contends that New Zeal and has not demonstrated serious flaws in the 
IRA's analysis with respect to this importation step.  Australia submits that New Zealand has not shown why the probability range assigned to this step is inconsistent with the scientific evidence cited 
by the IRA, or indeed, with its own view that the likelihood is "exceedingly small".
1569 
                                                      
1563 See para. 7.301 above.  See also, Dr Deckers's and Dr Paulin's replies to Panel questions 14 and 29, 
in List of Replies from the scientific experts to qu estions posed by the Panel, paras. 115, 208 and 209. 
1564 Dr Deckers's reply to Panel question 31, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 218.  See also, Dr Paulin's reply to Panel question 31, in List of Replies from the 
scientific experts to questions posed by the Panel, para. 219. 
1565 Australia's IRA, Part B, pp. 19-21. 
1566 New Zealand's first writte n submission, para. 4.232. 
1567 Ibid. 
1568 New Zealand's second writte n submission, para. 2.431. 
1569 Australia's second written submission, para. 394. WT/DS367/R 
Page 276  
 
 7.336  Australia notes New Zealand's contention that the event covered by this importation step 
would have an exceedingly small probability of occu rrence, similar to importation steps 3 and 5.  
Australia argues in this regard th at, according to the IRA's methodolog y, the qualitative descriptor for 
"negligible" events corresponds with a probability interval between 0 and 10
-6.  This is precisely the 
probability interval assigned to importation step 7.  Accordingly, in Australia's view, New Zealand 
should have no complaint with importation step 7.1570 
7.337  Australia notes that the IRA considered that the only contamination risk under this step arose 
from bacterial ooze from internally infe cted fruit.  "Given that it considered internal infection to be a 
'rare event', and that rotten fruit is highly likely to be discarded at  harvest, at the packing line or 
during quality inspection, the IRA Team consider ed there was little opportunity for fruit to be 
contaminated at this stage."1571 
(ii) The Panel's analysis 
7.338  The IRA estimates the likelihood that  clean fruit is contaminated by Erwinia amylovora  
during palletization, quality inspection, containerizat ion and transportation as a triangular distribution 
with a minimum value of 0, a maximum value of 10-6 (1 in 1,000,000) and a most likely value of 5 × 
10-7 (5 in 10,000,000).1572 
7.339  The IRA notes that "[a]fter consideration of the technical information the IRA Team 
concluded that there was little opportunity for fruit to be contaminated at this stage": 
"Surface contamination of clean fruit can  occur only if bacteria ooze out from 
internally infected fruit.  Such fruit are rare ly found ... as rotten fruit is not harvested.  
If harvested, such fruit is rejected before entering the packing line.  If rotten fruit is 
present after cold storage, it is discarded at quality inspection. 
Packed fruit is kept under secure conditions , not exposed to elements and therefore 
not exposed to bacterial inoculum."1573 
7.340  Dr Deckers and Dr Paulin highlighted that inte rnally infected mature fruits are not able to 
produce bacterial ooze;  these fruits will immediat ely be invaded by fungal infections.  Ooze 
production would only occur on immature fruits, where the starch of the imma ture fruits is used by 
the Erwinia amylovora  bacteria during the multiplication phase.1574  In any event, as noted by the 
IRA1575, internally infected fruits producing ooze, if a ny, would have been discarded well before this 
step and before entering the packing line. 
7.341  In its analysis of this step, the IRA does not  provide any scientific evidence that external 
pollution can happen as described in this importa tion step, except in the case of oozing fruits.1576  The 
only reference to any scientific evidence at all in th e IRA's analysis concerning this importation step is 
                                                      
1570 Australia's first written submission, para. 439. 
1571 Australia's first written submission, para. 438 (footnote omitted). 
1572 Australia's IRA, Part B, p. 79. 
1573 Ibid.  See also, Van der Zwet et al., "Population of Erwinia amylovora  on External and Internal 
Apple Fruit Tissues" (1990), in Exhibit AUS-31. 
1574 Dr Deckers's and Dr Pau lin's replies to Panel question 33, in List of Replies from the scientific 
experts to questions posed by the Panel, paras. 229 and 230. 
1575 Australia's IRA, Part B, p. 79. 
1576 Dr Deckers's, Dr Paulin's and Dr  Sgrillo's replies to Panel question 32, in List of Replies from the 
scientific experts to questions posed by the Panel, paras. 226, 227-228 and 220-225.  WT/DS367/R 
 Page 277 
 
 
 to the van der Zwet (1990) study.  The Panel has al ready noted the limitations of this paper, in the 
light of the comments made by its own first author.1577 
7.342  The quantitative range assigned by the IRA for th e likelihood of the event represented by this 
importation step corresponds to the IRA's definition of "negligible" (i.e., "the event would almost 
certainly not occur").  The IRA's conclusion that the likelihood that clean fruit is contaminated by 
Erwinia amylovora  during palletization, quality inspection, containerization and transportation is 
negliglible appears to be coherent and objective.   The Panel will turn later, in the context of 
New Zealand's allegations regarding the IRA's alle ged methodological flaws, to the issue of whether 
the IRA's choice of a probability interval of zero to  one in one million for events with a "negligible" 
likelihood of occurring is in itself supported by ad equate scientific evidence and is, accordingly, 
coherent and objective. 
(h) Estimation for importation step 8 
7.343  Importation step 8 represents the likelihood that in fected or infested fru it remains infected or 
infested after on-arrival minimum border procedures.1578 
(i) Summary of the Parties' arguments 
7.344  New Zealand submits that "it is difficult to disagree" with the IRA's conclusion that the 
likelihood that Erwinia amylovora survives and remains with the fruit after on-arrival minimum 
border procedures should be 1.1579  New Zealand argues in this regard that "[i]f E. amylovora is 
present when apples arrive at the border it seems hardly likely that 'on-arrival minimum border 
procedures' could have any effect on it."1580  It adds, however, that this statement "is hardly 
meaningful.  It, too, depends on the assumption that a pathway exists for the transmission of 
E. amylovora , an assumption for which there is no supporting scientific evidence."1581 
7.345  In New Zealand's view, "importation step 8 h as no purpose, other than to indicate that 
Australia's border procedures are not designed to eliminate any E. amylovora  that might be carried on 
imported apples.  Nor, in New Zealand's view, need they be designed to do so."1582 
7.346  In response, Australia contends that New Zealand's argument regarding importation step 8 "is 
irrelevant ... as New Zealand agrees with th e IRA Team that it is certain that any E. amylovora  present 
by this step will survive to the next stage."1583 
(ii) The Panel's analysis 
7.347  The IRA estimates the likelihood that Erwinia amylovora  survives and remains with the fruit 
after on-arrival minimum border procedures is 1 (100 per cent).1584 
                                                      
1577 See para. 7.285 above.  Declaration of Tom van der Zwet, 16 July 2002, in Exhibit AUS-32.  
Dr Paulin's reply to Panel question 32, in List of Replies from the scientific experts to questions posed by the 
Panel, paras. 227-228;  Dr Paulin's reply to Panel question 24, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 175.  But see, Australia's IRA, Part B, pp. 63. 
1578 Australia's IRA, Part B, pp. 19-21. 
1579 New Zealand's first writte n submission, para. 4.233. 
1580 Ibid. 
1581 New Zealand's first writte n submission, para. 4.234. 
1582 New Zealand's second writte n submission, para. 2.433. 
1583 Australia's first written submission, para. 440.  See also, Australia's second written submission, 
para. 395. 
1584 Australia's IRA, Part B, p. 80. WT/DS367/R 
Page 278  
 
 7.348  The IRA notes that "[b]acteria present on the surf ace, in the calyx or internally will not be 
detected at on-arrival border procedures.  Standard  on-arrival inspection procedures would not be able 
to detect the presence of bacteria.  Fruit carrying bacteria would not show any symptoms of fire 
blight."
1585 
7.349  New Zealand has not called into question the IR A's estimation of the likelihood of the event 
represented by this particular importation step.  In any event, there is no reason to believe that such 
estimation is not coherent and objective in th e light of the scenario addressed by the IRA. 
(i) Alleged overestimation for the overall probability of importation 
7.350  The overall probability of importation represents the likelihood that an imported apple is 
infected or infested;  it results from the sum of the proportions associated with the ten individual 
importation pathways.1586 
(i) Summary of the Parties' arguments 
7.351  New Zealand argues that the overall probability of importation is a greatly inflated figure.1587  
In New Zealand's view, this figure "exceeds the ma ximum reported infestation in New Zealand, which 
was from a severely infected orchard."1588  New Zealand suggests that, based on scientific evidence, 
the value assigned to the overall probability of  importation should be considerably lower.1589 
7.352  In response, Australia argues that the infestation rate of imported apples from New Zealand, 
corresponding to the overall probability of importing Erwinia amylovora , was estimated by inserting 
the likelihoods for each importation st ep into the risk simulation model.1590 
(ii) The Panel's analysis 
7.353  Regarding the overall prob ability of importation of Erwinia amylovora , the IRA notes that: 
"When the above likelihoods [for each of th e importation steps] were inserted into the 
risk simulation model, the probability of importation of E. amylovora was estimated 
as being 3.9 × 10-2 (mean), 2.2 × 10-2 (5th percentile) and 5.6 × 10-2 (95th percentile).  
Therefore, the infestation rate for E. amylovora  was estimated to be 3.9% (mean) of 
the total proposed number of apples imported from New Zealand annually."1591 
7.354  The experts have confirmed that, arithmetically, the overall figure of 3.9 per cent is correct, as 
it results from adding the different individual lik elihoods represented by each of the ten potential 
importation paths.1592  However, Dr Paulin noted that the exercise of trying to reach an overall 
                                                      
1585 Australia's IRA, Part B, p. 80 . 
1586 Australia's IRA, Part B, pp. 23-24. 
1587 New Zealand's first written submission, para. 4. 235;  New Zealand's se cond written submission, 
para. 2.434. 
1588 New Zealand's first writte n submission, para. 4.235. 
1589 Ibid.  See also, New Zealand's second written submission, para. 2.434.  Roberts et al. , "The 
potential for spread of Erwinia amylovora  and fire blight via commercial apple fruit" (1998), p. 23, in Exhibit 
NZ-22;  and, Roberts and Sawyer, "An updated pest risk assessment for spread of Erwinia amylovora  and fire 
blight via commercial apple fruit" (2008), in Exhibit NZ-29. 
1590 Australia's second written submission, para. 396. 
1591 Australia's IRA, Part B, p. 80. 
1592 Dr Deckers's and Dr Sgrillo's replies to Panel qu estion 34, in List of Replies from the scientific 
experts to questions posed by the Panel, paras. 237 and 236.  WT/DS367/R 
 Page 279 
 
 
 likelihood of importation by estimating individual  probabilities for each importation pathway may be 
flawed: 
"[I]f one can speculate or discuss on the likelihood of any event involved in the 
possible transport of E. amylovora  with apples, the quantification of probabilities of 
each one of these events is just not feasible .  This quantification relies on an arbitrary 
estimation, which, even in the best- documented case, is just hidden behind a 
'scientific' explanation, which is never completely relevant, if only because the 
conditions in the laboratory are only partia lly mimicking natural conditions.  This 
quantification of probability may have a merit in trying to assess the relative  risks 
attached to each step, as compared to each other.  The overall figure resulting from 
the combination of these probabilities is just not credible :  if the 3.9% figure had any 
consistency, it is a figure that could be qu ite easily checked experimentally (as is, for 
example, spread through planting material).  Such an experiment would have been 
more convincing than the present efforts by IRA to demonstrate what cannot be really demonstrated."
1593 
7.355  Irrespective of whether this exercise of tryi ng to reach an otherwise unsupported overall 
likelihood of importation by aggregating probabilities for individual importation paths is flawed, some 
of the figures estimated by the IRA Team are problem atic.  Indeed, if the estimations of one or more 
of the individual likelihoods are questionable, b ecause those estimations are either not supported by 
adequate scientific evidence or not based on a c oherent and objective reasoning, the overall figure 
necessarily becomes questionable. 
7.356  Moreover, the IRA does not attempt to find jus tification for the estimated overall probability 
of importation, other than the aggregation of the different individual likelihoods represented by each 
importation step.1594  Consulted by the Panel, Dr Decker s expressed the view that this overall 
probability is a relatively high value and is probably overestimated.1595  Dr Paulin emphasized that, 
because the IRA does not present data to support it s estimation regarding the overall likelihood of 
importation, it is impossible to consider whether this estimation is or is not ex aggerated and, if it is, 
the seriousness of the exaggeration.1596  Indeed, commenting on the risk assessment methodology, 
Dr Sgrillo notes that "quantitative methods should be  applied only when ther e are sufficient data to 
support the choice of probability ranges and probability shapes."1597  Dr Sgrillo suggests in this regard 
that the data in the IRA "is not adequate to genera te the kind of numbers that the people need to 
proceed with the model."1598  Ultimately, any figures estimated would subsequently need to be 
compared with the reality to verify that th e model adequately reflects the real world.1599 
7.357  In the light of the conclusions reached earlier by the Panel regarding the IRA's estimations of 
individual importation steps1600, and of the lack of any separate justification and evidence in the IRA 
regarding the estimated overall likelihood of importati on, the Panel finds that the IRA's estimation of 
                                                      
1593 Dr Paulin's reply to Panel question 34, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 238-239 (original emphasis). 
1594 Australia's IRA, Part B, p. 80.  See also, Table 4 in Australia's IRA,  Part B, p. 24.  See, reply of 
Dr Sgrillo in Transcript of the Pane l's meeting with experts, para. 269. 
1595 Dr Deckers's reply to Panel question 34, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 237.  See also, Dr Sgrillo's reply to Panel question 34, in List of Replies from the 
scientific experts to questions posed by the Panel, paras.  231-235.  But see, Dr Deckers's reply in Transcript of 
the Panel's meeting with experts, para. 259. 
1596 Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 258. 
1597 Dr Sgrillo's reply in Transcript of the Panel's meeting with experts, para. 122. 
1598 Dr Sgrillo's reply in Transcript of the Panel's meeting with experts, para. 143. 
1599 Dr Sgrillo's replies in Transcript of the Pane l's meeting with experts, paras. 34 and 136. 
1600 See paras. 7.259, 7.275, 7.290, 7.320 and 7.342 above. WT/DS367/R 
Page 280  
 
 the overall probability of importation does not rely on adequate scientific evidence and, accordingly, 
is not coherent and objective. 
(j) IRA's analysis of the probability of entry, establishment and spread of fire blight 
7.358  Factors relevant to the estimation of the pr obability of entry, establishment and spread 
include:  the probability of importation (in accordan ce with the different importation steps);  the 
proximity value;  the probability of exposure;  the probability of establishment;  and the probability of 
spread.
1601 
(i) Summary of the Parties' arguments 
7.359  New Zealand argues that, just as the IRA does not  contain an evaluation of the likelihood of 
entry of fire blight, it also fails to evaluate th e likelihood of the "establishment or spread of the 
disease" within the meaning of paragra ph 4 of Annex A to the SPS Agreement.1602  New Zealand 
submits that, "[a]s a result, Australia has not comp lied with its obligations under Article 5.1 of the 
SPS Agreement ."1603  In New Zealand's view, "Australia's risk assessment fails to meet the 
requirements of Article 5.1 because it does not assess the actual risk of introduction of fire blight via mature, symptomless apples".
1604  It is based on a hypothetical pathway, "one based on a hypothesis, 
supposed or assumed but not necessarily real or true".1605 
7.360  New Zealand submits that there is no scientific evidence of a dispersal mechanism to move 
the bacteria to a susceptible host, so that  once apples infested or infected with Erwinia amylovora 
arrive in Australia, the disease may be transmitted to host plants.  In New Zealand's view, the IRA's 
analysis in this regard "rests on remote possi bilities and not on probabilities based on scientific 
evidence".1606  New Zealand contends that the IRA assigns values "in a seemingly arbitrary manner" 
to various utility points from which there could be transfer of bacteria from infested apples to host 
plants1607:  "events that have an extremely low lik elihood ... are nevertheless assigned probability 
values which suggest they are likely to occur".1608 
7.361  New Zealand alleges some "further, specific problems" with the IRA's analysis of 
"establishment and spread".  First, the IRA ignor es that bacterial populations on apples "will greatly 
decline" during cold storage in Australia before retail sale and distribution.1609 Second, the IRA cites 
no scientific basis for its assumption that there can be multiplication of Erwinia amylovora  on a 
discarded apple, or that such bacteria could be  spread to a susceptible host by browsing insects.1610  
Available scientific evidence rather shows that populations of Erwinia amylovora associated with 
                                                      
1601 Australia's IRA, Part B, p. 80.  See also, Australia's IRA, Part B, p. 17. 
1602 New Zealand's first writte n submission, para. 4.238. 
1603 New Zealand's first writte n submission, para. 4.252. 
1604 New Zealand's second writte n submission, para. 2.437. 
1605 New Zealand's second writte n submission, para. 2.439. 
1606 New Zealand's first wr itten submission, para. 4.239.  S ee also, New Zealand's first written 
submission, paras. 4.247-4.248. 
1607 New Zealand's first written s ubmission, paras. 4.240-4.241. 
1608 New Zealand's first writte n submission, para. 4.241. 
1609 New Zealand's first written submission, para. 4.24 2, referring to Taylor and Hale, "Cold storage 
affects survival and growth of Erwinia amylovora  on the calyx of apple" (2003), in Exhibit NZ-25;  and, Temple 
et al. , "Evaluation of Likelihood of Co-Occurrence of Erwinia amylovora  with Mature Fruit of Winter Pear" 
(2007), p. 1272, in Exhibit NZ-98. 
1610 New Zealand's first written submission,  para. 4.243, referring to Taylor et al., "Survival of the fire 
blight pathogen, Erwinia amylovora , in calyxes of apple fruit discarded in an orchard" (2003), in Exhibit NZ-28;  
and, Hale et. al ., "Ecology and Epidemiology of fire blight in New Zealand" (1996), in Exhibit NZ-27.  
See also, New Zealand's second written submission, paras. 2.442-2.444.  WT/DS367/R 
 Page 281 
 
 
 mature fruit would have a negligible probability of infecting a host, even if the host were receptive.1611  
Nor is there any scientific evidence cited to support th e theory of mechanical transfer via workers or 
equipment leading to infection.1612  Additionally, in New Zealand's view, the IRA wrongly claims that 
there is no accepted threshold number of Erwinia amylovora  required to initiate an infection.1613  
Third, the IRA's argument about the dispersal mechanism is based on the wrong assumption that 
laboratory conditions will be replicated  in a natural orchard environment.1614  New Zealand argues in 
this regard that, in real life, "even under conditio ns conducive for infection, bacterial populations are 
unlikely to reach such high inoculum  levels in such a short period".1615  In New Zealand's view: 
"The IRA's contention that E. amylovora  can spread via mature fruit not only requires 
that each of [a number of] unproven events mu st occur but that they must all occur in 
sequence in a short period of time when a host blossom is susceptible and the climate 
is conducive to infection by E. amylovora . ... The probability of each of these never 
demonstrated events occurring is negligible ;  the probability of them occurring in the 
correct sequence at the correct time has to be very close to zero."1616 
7.362  According to New Zealand, the IRA's estimate of the likelihood of transfer of Erwinia 
amylovora  from a single infested or infected apple to a susceptible host (exposure value) is "grossly 
exaggerated".  The only scientific evidence of the probability of such events occurring assigns values 
of one event per several thousand years.1617 
7.363  In response, Australia argues that New Zeala nd's argument that establishment and spread of 
fire blight through mature apples has never been demonstrated and lacks merit, as does the argument 
that the IRA's evaluation in this regard is "hypothetical" and "grossly exaggerated".1618  In Australia's 
view, just because a pathway has never been histori cally proven, is not determinative that it can never 
happen.1619  Australia submits that the proper enquiry is whether the likelihoods assigned by the IRA 
are credible and objective.  In this regard, Australia  states that, "at each stage in the pathway relating 
to establishment and spread, the IRA Team made a cr edible assessment on the basis of the scientific 
evidence and accordingly, its evaluation should stand".1620 
7.364  Australia argues that, in accordance with inte rnational standards, in circumstances of 
scientific uncertainty a risk assessment may explore hypothetical pathways, although it is important 
for transparency to document the areas and the degree of uncertainty in the assessment, and to indicate 
                                                      
1611 New Zealand's first written submission,  para. 4.243, referring to Taylor et al., "Survival of the fire 
blight pathogen, Erwinia amylovora , in calyxes of apple fruit discarded in an orchard" (2003), in Exhibit NZ-28;  
and, Hale et. al ., "Ecology and Epidemiology of fire blight in New Zealand" (1996), in Exhibit NZ-27.  See 
also, New Zealand's second written submission, paras. 2.442-2.444. 
1612 New Zealand's second written s ubmission, paras. 2.445-2.446. 
1613 New Zealand's first written submission, para. 4. 244, referring to Thomson and Gouk, "Influence of 
Age of Apple Flowers on growth of Erwinia  amylovora  and Biological Control Agents" (2003), in Exhibit NZ-
54;  and, Taylor et al., "Effect of inoculum dose on infection of apple ( Malus domestica ) flowers by Erwinia 
amylovora " (2003), in Exhibit NZ-23. 
1614 New Zealand's first writte n submission, para. 4.245. 
1615 Ibid. 
1616 New Zealand's first written s ubmission, paras. 4.246-4.247. 
1617 New Zealand's first written submission, pa ras. 4.249-4.250, referring to Roberts et al. , "The 
potential for spread of Erwinia amylovora  and fire blight via commercial apple fruit" (1998), p. 23, in Exhibit 
NZ-22;  Roberts and Sawyer, "An updated pest risk assessment for spread of Erwinia amylovora  and fire blight 
via commercial apple fruit" (2008), in Exhibit NZ-29. 
1618 Australia's first written submission, paras. 442-443. 
1619 Australia's first written submission, para. 443. 
1620 Australia's first written submission, para. 447.  See also, Australia's second written submission, 
para. 403. WT/DS367/R 
Page 282  
 
 where expert judgement has been used.
1621  In this regard, Australia argues that "[t]he SPS Agreement 
does not require a risk assessment to establish a minimum magnitude of risk and permits reliance upon a range of scientific opinions emana ting from qualified and respected sources."
1622 
7.365  Australia contends that New Zealand's analysis  of the steps necessary for fire blight to 
establish and spread in Australia, including New Zeala nd's assumptions that apple fruit must arrive in 
Australia with significant quantities of Erwinia amylovora  in the calyx, that browsing insects are the 
only vector for transmission of Erwinia amylovora  to a host, and that bacteria must multiply to 106 in 
a short period during conducive weather conditions, has "significant shortcomings".1623 
7.366  Australia argues further that New Zealand's clai ms in relation to the IRA Team's proximity 
analysis are weak and should be dismissed.1624  In its view, New Zeala nd makes an unsupported vague 
statement and does not challenge any particular as signment of likelihood in this regard, except the 
combination of urban retailers and commercial fruit crops.1625 
7.367  With respect to cold storage, Australia argues that the scientif ic evidence clearly shows that 
Erwinia amylovora  can survive on apples for periods considerab ly longer than those needed to import, 
distribute and sell apples in Australia.1626 
7.368  Australia also argues that the studies consider ed in the IRA are evid ence that the minimum 
number of Erwinia amylovora  needed to start fire blight is much lower than that claimed by 
New Zealand.  Such minimum number varies gr eatly and is highly dependent on environmental 
conditions and host factors.1627  Australia adds that "[t]o the exte nt that New Zealand relies on this 
claim to support its objection to the entire risk scen ario, Australia submits that this objection should 
be found wholly without support."1628 
7.369  Australia argues further that the ability of Erwinia amylovora  to rapidly multiply in the 
environment on or in apple fruit, increasing the ch ance that an effective inoculum dose will be 
available is substantiated and therefore is a credible part of the risk assessment.1629 
7.370  Regarding transmission of Erwinia amylovora  from apples to hosts by browsing insects, 
Australia argues that the eviden ce available to the IRA Team demonstrated that there was a 
likelihood, albeit small, that insect -vectored transmission could occur.1630  The evidence cited by 
New Zealand, which detected no spread of fire blight when apples contaminated with 
                                                      
1621 Australia's first written submission, paras. 444-446;  Australia's second written submission, 
para. 401.  Pest risk analysis for quarantine pests, including analysis of environmental risks and living modified 
organisms , 2004 (ISPM No. 11, FAO, Rome), submitted as Exhibit AUS-6. 
1622 Australia's first written submission, para. 446. 
1623 Australia's first written submission, para. 449. 
1624 Australia's first written submission, para. 456. 
1625 Australia's first written submission, paras. 454-455. 
1626 Australia's first written submission, para. 457. 
1627 Australia's first written submission, paras. 458-462.  Van der Zwet et al ., "Evaluation of the 
MARYBLYT Computer Model for Predicting Blossom B light on Apple in West Virginia and Maryland" 
(1994), in Exhibit AUS-28;  Hildebrand, "Infectivity of the Fire-Blight Organism" (1937), in Exhibit AUS-29;  
and, Cabrefiga and Montesinos, "Analysis of Aggressiveness of Erwinia amylovora Using Disease-Dose and Time Relationships" (2005), in Exhibit AUS-37. 
1628 Australia's first written submission, para. 462. 
1629 Australia's first written submission, paras. 463-471.  Longstroth, "Fire Blight Symptoms" (2007), in 
Exhibit AUS-42;  van der Zwet et al., "Population of Erwinia amylovora  on External and Internal Apple Fruit 
Tissues" (1990), in Exhibit AUS-31;  and, Sholberg et al., "Occurrence of Erwinia amylovora  of pome fruit in 
British Columbia in 1985 and its elimination from the apple surf ace" (1988), in Exhibit AUS-34. 
1630 Australia's first written submission, paras. 472-475;  Australia's second written submission, 
para. 399.  WT/DS367/R 
 Page 283 
 
 
 Erwinia amylovora  were placed in orchards, is of limited value, because the sample size in these 
experiments was insufficient to detect rare events.1631  In this regard, "[s]ince the pathway being 
examined is hypothetical, the IRA Team was not obliged to disregard a potential vector simply 
because it has never been shown to 'demonstrate' transmission of E. amylovora ."1632 
7.371  Australia adds that the IRA Team also identifie d mechanical processes, such as tools, hands, 
machinery, etc., as a means of transmission of the disease.1633  Australia notes that New Zealand did 
not address this mode of transmission in its first submission and therefore failed to establish that the 
IRA's conclusions on this issue should be doubted.1634 
7.372  Regarding the IRA's conclusion on exposure, Au stralia submits that "while the chain of 
events required for a successful exposure only has a small chance of occurring, the scientific evidence 
demonstrates that such exposure events can happen."1635  In its view, the probability of exposure has 
been estimated at a range that is equivalent to the qualitative descriptor for a "negligible" event and, 
accordingly, New Zealand should have no objecti on to the IRA's judgement in this regard.1636 
7.373  Australia argues that New Zealand did not ma ke any claims relating to fire blight 
establishment under Article 5.1 in its first written submission, and should no t be permitted to make 
any such claims at a later stage.1637  Australia adds that the IRA refers to studies that show that a 
number of major apple and pear growing areas in Australia would have suitable conditions for the 
establishment of fire blight and that major Australia n cities such as Sydney have many fire blight host 
plants and highly suitable c onditions for fire blight.1638  Australia also notes that Erwinia amylovora  
survival is highly variable and that the IRA shoul d not be judged against New Zealand's alternative 
account based on selective scientific evidence.1639 
7.374  Finally, Australia argues that the IRA's spread analysis examined the ability of the pathogen 
to spread to other susceptible hosts, once the dis ease has established on a host plant in Australia.  
Because New Zealand did not make any claims relating to fire blight spread under Article 5.1 in its 
first written submission, it should not be permitted to make any such claims at a later stage.1640 
(ii) The Panel's analysis 
7.375  In its estimation of the probability of entry, establishment and spread of fire blight, the IRA 
has taken into account the following factors:  the probability of importation, that has already been 
discussed with respect to the different importation st eps;  the proportion of utility points near host 
plants susceptible to the pest in each exposure grou p, titled "proximity";  the probability of exposure 
of a susceptible host plant in the ex posure group to the pest by an  infested/infected apple discarded 
near it, titled "exposure";  the probability of establishment;  and the probability of spread."1641 
                                                      
1631 Australia's first written submission, para. 475. 
1632 Australia's first written submission, para. 473. 
1633 Australia's first written submission, paras. 472 and 476, referring to Thomson, "Epidemiology of 
fire blight" (2000), p.17, in Exhibit NZ-05. 
1634 Australia's first written submission, para. 476. 
1635 Australia's first written submission, para. 477.  Roberts and Sawyer, "A n updated pest risk 
assessment for spread of Erwinia amylovora  and fire blight via commercial apple fruit" (2008), in Exhibit NZ-
29.  See also, Australia's second written submission, para. 402. 
1636 Australia's first written submission, paras. 477-479. 
1637 Australia's first written submission, para. 481. 
1638 Australia's first written submission, para. 482. 
1639 Australia's first written submission, para. 483. 
1640 Australia's first written submission, paras. 484-485. 
1641 Australia's IRA, Part B, p. 80.  See also, Australia's IRA, Part B, p. 17. WT/DS367/R 
Page 284  
 
 7.376  The probability of importation, combined with the proximity and the exposure analyses, result 
in the overall probability of entry.  In turn, the expos ure analysis takes into account factors such as:  
viability of the pest, survival of the pest, tran sfer mechanism of the pest, inoculum dose, host 
receptivity and environmental factors.
1642  All scenarios subsequent to the probability of importation 
that has been discussed above are only rele vant under the assumption that some viable Erwinia 
amylovora  bacteria would still be present on imported apples from New Zealand. 
Proximity  
7.377  Under its proximity analysis, the IRA assesses "how apples from New Zealand would be 
distributed, used and subsequently disposed of."1643  With respect to fire blight, the term "proximity" 
in the IRA refers to the likelihood that one of the ma jor handlers and users of apples (a utility point) is 
sufficiently close to a host plant in a particular exposure group, for the likelihood of transfer of 
bacteria to a host to be greater than zero.1644  The IRA considers the following utility points:  orchard 
wholesalers, urban wholesalers, retailers, food services and consumers.  It also considers the following exposure groups:  commercial fruit crops, nursery plants, household and garden plants and 
wild and amenity plants.  The IRA describes is sues specific to each utility point and estimates 
proximity ratings for the combination of each utility point with exposure groups (proximity 
values).
1645  The IRA considers two scenarios regarding proximity.  Under the first scenario, 70 to 100 
per cent of imported apples are distributed to or chard packing houses and the remainder to urban 
wholesalers, while under the second scenario, only 0.1 to 5 per cent of imported apples are distributed 
to orchard packing houses.1646 
7.378  As noted above, New Zealand has submitted few ar guments to contest the IRA's analysis on 
proximity.  It has mainly argued that the IRA ha s assigned proximity values in a seemingly arbitrary 
manner.1647 
7.379  Consulted by the Panel, the experts expressed scepticism regarding some of the scenarios 
considered under the IRA's proximity analysis.  With  respect to the likelihood and implications of 
New Zealand apples being repacked at rural packing houses in close proximity to orchards, 
Dr Deckers considered that the IRA's analysis "is not convincing and seems not to be based on 
objective criteria".1648  Dr Paulin noted that, while the IRA's assessment is "apparently coherent", he 
could not see how the relative levels of pr obability for each situation were evaluated.1649  More 
importantly, as noted by Dr Paulin, the issue of proximity is likely to be of " minor importance  for fire 
blight risks", if apples from New Zealand are imported as retail-ready, because they would probably not be processed at rural packing houses in proximity to host plants.
1650  In the words of Dr Paulin, 
"the time of import (whether it takes place during a pe riod of receptivity of host plants or not) is more 
important in the risk assessment than the site of import and (hypothetical) packaging".1651 
7.380  Although the IRA offers little e xplanation and supporting eviden ce for its reasoning regarding 
the estimation of the different proximity values, the Panel finds that New Zealand has not made a 
                                                      
1642 Australia's IRA, Part B, pp. 80-90.  See al so, Australia's IRA, Part B, pp. 17 and 27. 
1643 Australia's first written submission, para. 451.  See, Australia's IRA, Part B, pp. 24-27. 
1644 Australia's IRA, Part B, p. 80;  Australia's IRA, Part B, pp. 24-27 and 29. 
1645 Australia's IRA, Part B, pp. 80-85;  Australia's IRA, Part B, pp. 24-27. 
1646 Australia's IRA, Part B, pp. 25-26 and 97.  See also, para. 7.432 below. 
1647 New Zealand's first writte n submission, para. 4.241. 
1648 Dr Deckers's reply to Panel question 46, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 294. 
1649 Dr Paulin's reply to Panel question 46, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 295. 
1650 Ibid. (original emphasis). 
1651 Ibid..  WT/DS367/R 
 Page 285 
 
 
 prima facie case that the IRA's discussion on utilit y points and estimated pr oximity ratings for the 
combination of each utility point with exposure groups (proximity values) is not objectively 
justifiable. 
Exposure  
7.381  Under its exposure analysis, the IRA assesses "t he likelihood of transfer of the pathogen from 
infested or infected apples (wast e) to a susceptible host plant."1652  According to the IRA, "[a]n 
analysis of key steps in the sequence of events that would need to occur for successful exposure 
includes a consideration of factors such as"  viab ility of the pest, survival  mechanism of the pest, 
transfer mechanism of the pest, inoculum dose, host receptivity and environmental factors.1653  After 
discussing these factors, the IRA estimates that "the e xposure value for an individual apple for all five 
utility points by four exposure groups combinati ons should be in the range of Uniform (0, 10-6).  This 
range is based on the IRA team's views on both mechanical and insect mediated transmission and explicitly acknowledges that in some circumst ances the chances of exposure would be zero."
1654 
7.382  The Panel will consider each of these factors in turn. 
Viability 
7.383  With respect to viability, the IRA notes that "[ b]acteria, especially those present in the calyx, 
may survive cold storage and transport".1655  The IRA adds that " E. amylovora is known to survive in 
calyces of mature apple fruit at harvest, from severely blighted orchards or when severe fire blight 
was present in the area."1656 
7.384  As noted by Dr Paulin, not all the papers incl uded in the IRA with respect to survival of 
Erwinia amylovora  provide perfectly established results a nd some of them, such as van der Zwet et al. 
(1990) are difficult to understand due to the complexity of the design of the paper.  "Nevertheless, the 
possibility of the presence of a limited surviving pop ulation of bacteria on the surface of mature fruits 
issued from severely infected environment, give n by the whole data presented, seems to be 
acceptable."1657 
7.385  Dr Deckers noted that the scientific evidence c ited by the IRA is strongest with respect to 
survival of Erwinia amylovora  bacteria in the calyx of mature apple fruit.1658  It should be noted again, 
however, that this viability scenario is only relevant under the assumption that some Erwinia 
amylovora  bacteria would still be present on imported apples from New Zealand.  The Panel has 
already discussed in this regard, for example, the reduction of bacterial populations that would occur 
through routine procedures that occur in New Zeal and packing houses, such as disinfection and cold 
storage.  Disinfection, in particular, has been noted  to have a significant impact in reducing bacterial 
populations, even in the calyx.1659 
                                                      
1652 Australia's IRA, Part B, p. 85.  See also, Australia's IRA, Part B, p. 27. 
1653 Australia's IRA, Part B, p. 27.  See al so, Australia's IRA, Part B, pp. 85-90. 
1654 Australia's IRA, Part B, p. 90. 
1655 Australia's IRA, Part B, p. 86. 
1656 Ibid.  See also, Van der Zwet et al., "Population of Erwinia amylovora  on External and Internal 
Apple Fruit Tissues" (1990), in Exhibit AUS-31;  and, Sholberg et al., "Occurrence of Erwinia amylovora  of 
pome fruit in British Columbia in 1985  and its elimination from the apple surface" (198 8), in Exhibit AUS-34. 
1657 Dr Paulin's reply to Panel question 6, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 47. 
1658 Dr Deckers's reply in Transcript of the Panel's meeting with experts, para. 227. 
1659 Australia's IRA, Part B, p. 72.  Toivonen et al ., "Factors involved in developing apple slices" 
(2001). WT/DS367/R 
Page 286  
 
 7.386  With respect to viability of Erwinia amylovora  on the surface of mature fruits, Dr Paulin 
explained that this bacterium is not a true epiphyte .  The term "epiphyte" would be reserved for those 
microorganisms that are able to multiply, and ther efore to reach a high level of population on leaves 
or plant surfaces, without producing symptoms.
1660  "Such a capacity does not exist  in the case of 
E. amylovora  (Thomson 2000), except on stigma in flowers.  Therefore the bacterial cells eventually 
present on the fruit surface could not multiply on the same site."1661 
7.387  Because Erwinia amylovora  can only survive, and not multip ly, on plant surfaces and in the 
calyx, the likelihood that this epiphytic population of bacteria serves as a new source of infestation in the orchard is very small and not supported on scientific evidence.
1662  As noted by Dr Deckers, 
"[t]here will be no multiplication of the epiphytic bacterial population on the fruit surface or in the 
calyx tissue.  The fire blight bacteria are not su rviving well as an epiphytic bacterial population. ... 
The chance for such a successful transfer and multipli cation of bacteria will be rather exceptional."1663 
7.388  In other words, mature apple fruits can harbour viable Erwinia amylovora  bacteria 
epiphytically on the fruit skin and, especially, in the calyx of  the fruit.  But, despite the IRA's 
statement that bacteria "may surv ive cold storage and transport", th e bacteria will not survive well.  
On the fruit skin, the bacteria will dry out easily and die, while in the calyx end they will be able to 
survive for a longer period.  In any event, there w ill be no multiplication of bacteria, even in the calyx 
end of the fruits.  The level of epiphytic populations of Erwinia amylovora  bacteria on apple fruits 
will remain low.1664 
7.389  The Panel has already noted that most of th e evidence cited in the IRA supports the notion 
that cold storage would reduce any bacterial population of Erwinia amylovora on apples, but would 
not completely eliminate such populatio n, although bacteria will not multiply.1665 
7.390  In conclusion, the scientific evidence cited in  the IRA supports the assumption that viable 
Erwinia amylovora  found on apple fruit, if there were any at th is stage, could survive cold storage and 
transport, albeit in reduced numbers. 
Survival 
7.391  With respect to survival, the IRA notes that: 
"Waste material should either have an ade quate inoculum dose in a viable state or 
bacteria must multiply to a concentration that  could initiate an infection.  When cores 
are discarded into the environment, nutrients released from damaged cells in apple cores could encourage viable bacteria in the calyx to multiply.  The availability of 
nutrients could also encourage other saprophytic micro-organisms to multiply at the 
                                                     
 
1660 Dr Paulin's replies to Panel questions 19 and 26, in List of Replies from the scientific experts to 
questions posed by the Panel, paras. 140 and 187-188;  Dr Paulin's reply in Transcript of the Panel's meeting 
with experts, para. 230. 
1661 Dr Paulin's reply to Panel question 19, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 140 (original emphasis). 
1662 Dr Deckers's replies to Panel questions 7 and 18, in List of Replies from the scientific experts to 
questions posed by the Panel, paras. 62 and 135-136. 
1663 Dr Deckers's reply to Panel question 19, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 139. 
1664 Dr Deckers's replies to Panel questions 7 and 37, in List of Replies from the scientific experts to 
questions posed by the Panel, paras. 62 and 252. 
1665 See para. 7.301 above.  WT/DS367/R 
 Page 287 
 
 
 same time.  When cores are discarded into the general soil environment, 
E. amylovora can survive for a limited period".1666 
7.392  The available evidence suggests that Erwinia amylovora  bacteria may survive in diminishing 
populations.  As noted by Dr Paulin, "long-term con servation of bacteria in a steady state" is well 
documented:  "in some cases, say in dried ooze, fo r example, the bacteria is able to survive for 
months, in certain conditions".1667 
7.393  No evidence is cited in the IRA, however, fo r the proposition that these surviving bacteria 
would be able to multiply in the calyx.  Instead,  as discussed above when considering the issue of 
viability, the evidence indicates that any Erwinia amylovora  bacteria found epiphytically on the fruit 
skin and in the calyx of the fruit will not survive we ll.  On the fruit skin, the bacteria will dry out and 
die, while in the calyx end they will be able to surv ive for a longer period.  In any event, the evidence 
suggests that there will be no multiplication of bacteria, even in the calyx.1668 
7.394  Dr Paulin noted that there is no scienti fic evidence to support the proposition that Erwinia 
amylovora  bacteria may multiply on decaying fruit discarde d in the open and exposed to the elements, 
but that such proposition cannot be ruled out.  "Deca ying fruit, as far as [its] chemical composition ... 
can be a suitable medium for the multiplication of Erwinia amylovora , although this remains to be 
demonstrated".1669 
7.395  In any event, as has been noted before, any Erwinia amylovora  bacteria would have to 
compete against natural antagonistic bacteria.  These antagonistic bacteria are naturally found in high 
concentrations on plant and on fruit surfaces a nd, according to Dr Paulin, would prevent a 
multiplication of Erwinia amylovora , if present.1670 
7.396  In conclusion, the scientific evidence cite d in the IRA supports the assumption that Erwinia 
amylovora  found on apple fruit, if there were any at this stage, could presumably survive in the 
environment.  Evidence also suggests that any bacterial population would decrease over time and would likely not be able to multiply. 
Transfer mechanisms 
7.397  With respect to the transfer mechanism, the IRA considers two possibilities:  browsing insects 
and mechanical transmission, for example, by the exposure of workers and equipment to bacteria.
1671 
7.398  According to the IRA: 
"Fire blight bacteria do not have a speci fic dispersal mechanism.  To transfer 
E. amylovora to a susceptible host, a vector must pick up the bacteria in a sufficient 
                                                      
1666 Australia's IRA, Part B, p. 86.  Ark, "The behaviour of Bacillus amylovorus  in soil" (1932);  
Hildebrand et al., "Survival studies with the fire blight pathogen Erwinia amylovora  in soil and in a soil-
inhabiting insect" (2001);  and, Thomson, "The overwintering of fire blight bacteria outside of living tissue in 
Utah" (1969). 
1667 Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 389. 
1668 See para 7.388 above.  Dr Deckers's replies to Panel questions 7 and 37, in List of Replies from the 
scientific experts to questions posed by the Panel, paras. 62 and 252. 
1669 Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 395.  See also, Dr Paulin's 
reply to Panel question 21, in List of Replies from the scientific experts to questions posed by the Panel, 
para. 146;  Dr Paulin's replies in Transcript of the Panel's meeting with experts, paras. 364 and 366. 
1670 See para 7.319 above.  Dr Paulin's replies to Panel questions 21 and 30, in List of Replies from the 
scientific experts to questions posed by the Panel, paras. 146 and 216-217. 
1671 Australia's IRA, Part B, pp. 87-88. WT/DS367/R 
Page 288  
 
 concentration to initiate a new infection. ... The most likely mechanism of transfer of 
bacteria from discarded apples to a receptive site in a susceptible host is by browsing insects (AQIS, 1998a).  Discarded apples are attractive to a wide range of insects and this attraction may be increased by rotting. ... Rotting of the apple could involve multiplication of fire blight bacteria resulting in the production of bacterial ooze. ... 
Mechanical transmission of fire blight bacteria could also be possible. For example, 
packing of New Zealand fruit in packing houses closely associated with apple orchards could result in the exposure of work ers and equipment to fire blight bacteria. 
Initiation of disease could then occur by tr ansfer of bacteria to wounds caused by 
normal orchard operations such as pruning."
1672 
7.399  The IRA cites no evidence for its proposition of a mechanical transmission of fire blight 
bacteria, for example, through exposure of workers and equipment to Erwinia amylovora  bacteria.  
Dr Deckers and Dr Paulin found this scenario to be "extremely unlikely".1673  Bacteria on workers and 
equipment, if any, would have to compete with other micro-organisms and bacteria.  Being a poor 
competitor, there is no indication that Erwinia amylovora  bacteria would survive or multiply to be 
transferred, as confirmed by the experts.1674 
7.400  Dr Deckers and Dr Paulin considered instead that the only relevant transfer mechanism of 
Erwinia amylovora  bacteria from discarded apples to a receptive site in a susceptible host would be 
that of browsing insects.1675  The transfer mechanism of br owsing insects suggested by the IRA 
seems, however, to be very unlikely, although not completely impossible.  As noted by Dr Paulin, this mechanism "is conceivable through an apparently logical succession of events, each of them being 
questionable, but never completely impossible ."
1676  To begin with, the level of the bacterial 
population present on the fruits would be in any event low or very low and most likely located in the 
calyx, and so these cells would not be easily accessible.  "In addition, bacterial cells on fruit are probably not embedded in ooze (as they are when actively multiplying from active lesions) and therefore not well protected from adverse conditions , and, which is more, probably have not the 
adhesive capacity, which is said to be a fac ilitating factor for transportation by insects."
1677 
7.401  In other words, the theoretical possibility of an insect taking a few bacterial cells to the 
hypantium of a flower of an host plant: 
"[R]emains unlikely because trace bacterial populations (not multiplying) will be 
hardly grasped by insects (it would be easier in the case of a multiplying population, where cells are embedded in exudate).  Finally the likelihood of successful 
multiplication on the hypantium and infection w ould be extremely low.  In addition, it 
                                                     
 
1672 Australia's IRA, Part B, pp. 87-88 .  See also, Australian Quarantine and Inspection Service, "Final 
Import Risk Analysis of the New Zeala nd Request for the Access of Apples ( Malus pumila  Miller var. 
domestica  Schneider) into Australia (1998). 
1673 Dr Deckers's reply to Panel question 20, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 142.  See also, Dr Paulin's reply to Panel questions 20 and 35, in List of Replies from 
the scientific experts to questions posed by the Panel, paras. 143-144 and 241-244. 
1674 Dr Deckers's reply in Transcript of the Panel' s meeting with experts, para. 237.  See also, 
Dr Paulin's reply in Transcript of the Panel's meeting with experts, paras. 234 and 236. 
1675 Dr Deckers's and Dr Paulin's replies in Transcript of the Panel's meeting with experts, paras. 293 
and 255. 
1676 Dr Paulin's reply to Panel question 35, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 241-244 (original emphasis). 
1677 Dr Paulin's reply to Panel question 18, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 138 (original emphasis).  WT/DS367/R 
 Page 289 
 
 
 would be necessary that such open flower be available when these surface polluted 
fruits are present.  All this cannot be considered to constitute an evidence."1678 
7.402  The scientific literature does not consider browsing insects to be a factor in the spread of fire 
blight from apples on the ground to new host plants.  As noted by Dr Deckers, "[a]n insect feeding 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.  The chance that th e epiphytic bacteria will be transmitted to the 
susceptible organs of a host plant on the appropria te moment to realise an infection is rather 
small."1679 
7.403  In conclusion, the IRA cites no evidence in support of its proposition of a mechanical 
transmission of fire blight bacteria.  There is al so scant scientific evidence in the IRA to support the 
scenario of browsing insects as a transfer mechanism of Erwinia amylovora  bacteria from discarded 
apples to a susceptible host.  The browsing insects scenario, however, is based on events that cannot 
be completely dismissed.  In any event, the probability value assigned to such event should be 
commensurate to the extremely low likelihood of transmission through the browsing insects scenario. 
Inoculum dose 
7.404  The IRA states that "[t]here is no accepted threshol d number of bacteria required to initiate an 
infection, and this may vary with environmental and host factors."1680  It then reports different studies, 
including one to the effect that "a single bacter ium was sufficient to cause infection in detached 
flowers when placed directly in the hypanthium  and incubated under optimal conditions in the 
greenhouse, and that this success rate increased with higher doses of inoculum".1681  The IRA adds 
that "[l]ow populations of E. amylovora  inoculated on to healthy stigmas can multiply rapidly to high 
populations".1682 
7.405  Notwithstanding the above, the IRA refers to the figure of 38 cells needed to initiate an 
infection on apple shoots, as obtained by Crosse et al.  (1972).1683  As noted by Dr Paulin, this figure 
proposes a basis for the minimal number of cells ab le to initiate an infection, "when introduced 
artificially at the proper site of the suitable plant, in optimal conditions for the disease".1684  The same 
expert adds that the figure: 
"Unfortunately it gives very few useful indications  for the description of events taking 
place in natural conditions. ... E. amylovora  is not able to multiply on plant surface 
(except for a short time, on the hypantium of stigmates in flowers).  It is difficult to imagine conditions conducive to actively gr owing cells in natura l conditions on the 
surface of a symptomless apple.  The spread of surface population from fruit to 
infection sites is similarly hard to imag ine, especially because these non-multiplying 
cells are not embedded in exudate, and ther efore not attractive to insects or other 
                                                     
 
1678 Dr Paulin's reply to Panel question 19, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 140-141. 
1679 Dr Deckers's reply to Panel question 35, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 240. 
1680 Australia's IRA, Part B, p. 88. 
1681 Ibid..  See also, Hildebrand, "Studies on fire blight ooze" (1939). 
1682 Australia's IRA, Part B, p. 88.  Thomson, "The role of the Stigma in fire blight infections" (1986), 
in Exhibit AUS-40;  Thomson et al., "Rapid epiphytic colonization of apple flowers and the role of insects and rain" (1999), in Exhibit AUS-39. 
1683 Australia's IRA, Part B, pp. 69-70.  Crosse et al. , "Leaf damage as a predisposing factor in the 
infection of apple shoots by Erwinia amylovora " (1972). 
1684 Dr Paulin's reply to Panel question 27, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 190. WT/DS367/R 
Page 290  
 
 vectors.  In artificial inoculations, bacterial populations at low level need to be placed 
very precisely  at the right site of infection, to successfully infect its host plant (Crosse 
et al.).  This is probably a difficulty impossi ble for the bacteria to tackle in natural 
conditions."
1685 
7.406  The number of bacteria present on a fruit is not i rrelevant when consider ing the likelihood of 
initiating an infection.  In the words of Dr Sgrillo: 
"Usually a number of conditions have to occur simultaneously to allow infection.  
The probability that an infected fruit, with  one bacterium, starts an infection is 
different from the probability of a fruit that is infested with 10,000 bacteria.  It is known that the probability of establishment is a function of the initial population size.  
The dose-response curve may present a thres hold for the inoculums concentration, 
below which no infection will occur."
1686 
7.407  Moreover, as emphasized by Dr Paulin, ther e is no guarantee that multiplication rates 
obtained in the laboratory will be replicated in the orchard.1687 
7.408  In conclusion, the IRA's discussion on inoculum  dose is supported by adequate evidence and 
generally coherent.  The IRA, however, fails to recognize the importance of the number of bacteria 
when considering the likelihood of initiating an inf ection.  The IRA's statement of a study reporting 
that a single bacterium was sufficient to cause infec tion, another reference to  five bacteria being 
sufficient to cause fire blight symptoms, as well as th e reference to the figure of 38 cells needed to 
initiate an infection on apple shoot, all fail to not e the difference between experiments taking place 
under ideal conditions in the laboratory, and natural circumstances. 
Host receptivity 
7.409  With respect to host receptivity,  the IRA notes the following: 
"[S]ufficient inoculum must be transferred to a receptive site in a susceptible host, 
mainly confined to the sub-family Malo ideae of the family Rosaceae.  There are at 
least 16 host genera susceptible to E. amylovora , each containing several species 
(AQIS, 1998a).  There are species not belonging to the sub-family Maloideae (for 
example, Prunus spp.) which are also hosts of E. amylovora . ... In host plants, the 
most susceptible site is the stigma in fl owers ... Flowers are abundant in spring in 
pome and other susceptible fruit trees, and at other times on some susceptible amenity plants.  The flowering stage is the only stag e when injury to tissue is not required for 
insects or wind-driven rain to cause infection by E. amylovora . ... 
For E. amylovora to establish initially, factors such as availability, numbers and 
distribution of susceptible hosts are importan t considerations.  In Australia, abundant 
susceptible apple plants are grown as monocu ltures in orchards.  A large number of 
                                                     
 
1685 Dr Paulin's reply to Panel question 27, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 190-191 (original emphasis). 
1686 Dr Sgrillo's reply to Panel question 28, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 197-200.  See also, New Zealand's reply to Panel question 63 after the first substantive meeting, paras. 101-107;  Australia's reply to  Panel question 63 after the first substantive meeting;  
Dr Sgrillo's reply in Transcript of the Panel's meeting with experts, para. 287. 
1687 Dr Paulin's reply to Panel question 40, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 262-263.  Dr Paulin's reply in Transcript of the Panel's meeting with experts, 
para. 337.  WT/DS367/R 
 Page 291 
 
 
 alternative hosts are also present in a pple growing areas in hedgerows and along 
roadsides."1688 
7.410  The issue of host receptivity constitutes an important  part of the exposure analysis.  To a large 
degree, the likelihood of establishment and spread of  the disease will depend on the availability of a 
host plant in a susceptible stage.  Even if transfer is possible, no infection will occur unless host plants 
are in a susceptible stage.1689 
7.411  Dr Paulin found the IRA's analysis on host  receptivity in principle to be coherent.1690  With 
respect to the maximum period of susceptibility to an introduction of Erwinia amylovora , however, he 
noted that, although it is difficult to tell when an in troduction of the bacteria would be most prone to 
turn into a natural infection, "it can be assumed that  most of the time during the year most host plants 
should not be at a receptive stage when the import of apple would take place".1691  Dr Paulin added 
that, realistically, the risk of introduction would only be high: 
"[I]n spring and early summer, with a po ssible additional dangerous period in 
summer and late summer if some hosts such as certain cultivars of apple and mainly of pears produce secondary blossoms (blo ssoms opening after the normal blossom 
period, usually associated with some physiological disorder).  In addition, the 
probability of infection will be associated with the number of hosts at the suitable 
stage at the moment of introduction.  In this respect, the maximum period of 
susceptibility to an introduction of E. amylovora  will be the full bloom period of 
pears, and then of apples."
1692 
7.412  Dr Paulin considered, therefore, that the IRA maximizes the real risks of exposure by 
considering too many host plants and not taking ad equately into account the discontinuity in the 
receptivity of susceptible host plants during the year.1693  He added that: 
"This is quite common in countries without fire blight.  They consider that any apple 
or any pear varieties are equally susceptib le to the disease and will be host of the 
disease, which is scientifically sound and r easonable, but when you are in a country 
with fire blight you know well that actually  this is not true and only a quite weak, 
fortunately, weak percentage of the cultiv ars are actually common hosts of the disease 
and do show a real damage.  So that is why the term of host has a different scientific 
and practical meaning:  any cultivar of pear, for example, is a host for fire blight, but 
economically only few cultivars are to be  considered as such, in such a case."1694 
7.413  In conclusion, the IRA reasoning with respect to host receptivity seems generally coherent, 
although it tends to exaggerate th e number of potential host plants and does not take into account the 
discontinuity in the receptivity of su sceptible host plants during the year. 
                                                      
1688 Australia's IRA, Part B, pp. 88-89. 
1689 Dr Deckers's reply in Transcript of the Panel's meeting with experts, para. 295. 
1690 Dr Paulin's reply to Panel question 10, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 79. 
1691 Dr Paulin's reply to Panel question 10, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 78. 
1692 Dr Paulin's reply to Panel question 10, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 77. 
1693 Dr Paulin's reply to Panel question 10, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 79. 
1694 Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 391. WT/DS367/R 
Page 292  
 
 Environmental factors 
7.414  The IRA describes the environmental conditions required for successful disease 
establishment, in addition to the host and the pathogen: 
"E. amylovora is capable of growing between 3ºC to 37ºC, with optimum temperature 
conditions spanning 25ºC to 27ºC (Billing et al., 1961).  Immediately after a wetting 
event caused by rain or heavy dew, coloni sed flowers would be infected when the 
average daily temperature is equal to or greater than 16 ºC and petals are intact 
(Steiner et al., 2000). Rain or dew facilitates the movement of E. amylovora  from the 
stigmas to the hypanthium where infection may occur (Thomson, 1986;  Thomson and Gouk, 1992).  Steiner (1990) and Lightne r and Steiner (1993) demonstrated that 
rain, hail, wind and dew could act as in itiators of epidemics of fire blight. 
Successful infection could take place if viable bacteria were present to infect 
susceptible host tissues under favourable e nvironmental conditions, provided that 
each step listed above is completed.  If there is a low likelihood of the entire chain of events being completed, then there is a lo w risk of establishment of fire blight.  
However, a break in any step of this chai n of events would prevent the establishment 
of the disease."
1695 
7.415  The IRA's review of evidence on the environmen tal conditions needed for successful transfer 
and establishment of the disease seems generally ade quate.  Dr Deckers noted that the question of 
whether the climatological conditions (temperature an d relative humidity) are present at the time that 
the fruits from New Zealand arrive in Australia is an essential part of the analysis.  Emphasizing that 
the Erwinia amylovora  bacteria cannot multiply on the epiphy tic surfaces of the fruits, the expert 
cautioned that "multiplication can only occur on sus ceptible organs like immature fruitlets or on the 
stigma of the flowers and only when the climatologi cal conditions (temperature  and relative humidity) 
are optimal for bacterial growth.  The question here is if these circumstances will be present at the 
time that the fruits from New Zealand arrive in Australia."1696 
7.416  In any event, the IRA reasoning with respect to the environmental conditions required for 
successful disease establishment seems generally coherent. 
Conclusion on exposure 
7.417  As noted above, the scientific evidence cited in the IRA supports the viability and the survival 
conclusions.  Both conclusions, however, rest on th e assumption that there will be some bacterial 
populations on mature apples from New Zealand.  Additionally, both conclusions must be qualified 
by the caveat that any bacterial populations would decrease over time and unlikely to be able to 
multiply.  The IRA's conclusions on the transfer m echanisms are not supported by scientific evidence, 
most especially for the proposed mechanical tr ansmission mechanism.  The browsing insect 
mechanism, while not totally unreasonable, seems to correspond to a highly unlikely scenario.  The 
IRA's conclusions on inoculum dose and host receptivity are supported by evidence and seem 
generally coherent;  although the first fails to r ecognize the importance of the number of bacteria for 
                                                      
1695 Australia's IRA, Part B, p. 89.  Billing et  al., "Characteristics of English isolates of Erwinia 
amylovora " (1961);  Steiner et al., "Fire blight, Erwinia amylovora " (2000);  Thomson, "The role of the Stigma 
in fire blight infections" (1986), in Exhibit AUS-40;  Thomson and Gouk, "The effect of rain on the development of Erwinia amylovora  and E. herbicola  populations on apple flowers" (1992);  Steiner, "Predicting 
apple blossom infections by Erwinia amylovora  using the MARYBLYT model" (1990);  and, Lightner and 
Steiner, "An update on version 4.1 of the MARYBLYT
TM computer program for predicting fire blight" (1993). 
1696 Dr Deckers's reply to Panel question 40, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 261.  WT/DS367/R 
 Page 293 
 
 
 the likelihood of initiating an infection and the second tends to exaggerate the number of potential 
host plants and does not take into account the discon tinuity in the receptivity of host plants.  Finally, 
the IRA's conclusions on environmental conditions seem generally coherent.  In the light of the 
shortcomings and qualifications that affect a number of sections of the IRA's conclusions on 
exposure, the Panel finds that overall these conclusi ons do not rely on adequate scientific evidence 
and, accordingly, are not coherent and objective. 
Establishment  
7.418  The IRA derives its conclusions regarding the probability of establishment from "a 
comparative assessment of those factors in the sour ce country and the 'PRA area' that are considered 
pertinent to the ability of a p est to survive and propagate".1697  These factors would include:  the 
availability of suitable hosts, alternate hosts and vectors in the PRA area;  the suitability of the 
environment;  the cultural practices and control m easures;  and other characteristics of the pest 
affecting the probability of establishment.1698  In the case of analysis of the probability of 
establishment for fire blight, the other factors incl ude:  the potential for adaptation of the pest;  the 
reproductive strategy of the pest;  the minimum population needed for establishment;  and the method 
of pest survival.1699 
7.419  A significant part of the IRA's discussion of the different factors regarding the probability of 
establishment has not been contested by New Zeala nd.  This includes, for example, the general 
description of the availability of suitable hosts, alternate hosts and vectors in the PRA area1700, the 
description of the suitab ility of the environment1701, the potential for adaptation of the pest1702 and the 
cultural practices and control measures.1703  One factor noted in the discussion on the suitability of the 
environment is the occurrence of hailstorms in pom e fruit growing areas in Australia.  The IRA notes 
that these hailstorms "cause injuries on plant tissues, predisposing them to infection".1704  The experts 
consulted by the Panel have also noted the importance that hailstorm injuries on plants would have for 
the likelihood of the initiation and establishment of fire blight disease under natural conditions.1705 
7.420  The IRA's discussion on the minimum population needed for establishment1706 reflects an 
assumption that has already been addressed by the Pa nel, regarding the alleged capacity of such low 
bacterial populations to initiate an infection.  This  assumption is an important factor in any conclusion 
regarding the probability of establishment of fire bl ight.  It has been found by the Panel not to be 
supported by scientific evidence nor based on a coherent and objective reasoning. 
Spread  
7.421  The IRA derives its conclusions regarding th e probability of spread from "a comparative 
assessment of those factors in the source country and 'PRA area' considered pertinent to the expansion 
                                                      
1697 Australia's IRA, Part B, p. 30. 
1698 Ibid. 
1699 Australia's IRA, Part B, pp. 90-93. 
1700 Australia's IRA, Part B, pp. 90-91. 
1701 Australia's IRA, Part B, p. 91. 
1702 Australia's IRA, Part B, pp. 91-92. 
1703 Australia's IRA, Part B, p. 93. 
1704 Australia's IRA, Part B, p. 91.  Brooks, "Studies of the epidemiology and control of fireblight of 
apple" (1926);  Keil et al., "Role of injury and longevity of Erwinia amylovora in the epidemiology of fire blight 
of pear" (1966). 
1705 See, for example, Dr Deckers's replies to Panel questions 15 and 18, in List of Replies from the 
scientific experts to questions posed by the Panel, paras.  117 and 135-136;  Dr Deckers's and Dr Paulin's replies 
in Transcript of the Panel's meeting with experts, paras. 229, 307 and 351. 
1706 Australia's IRA, Part B, p. 92. WT/DS367/R 
Page 294  
 
 of the geographical distribution of a pest".
1707  These factors would include:  the suitability of the 
natural and/or managed environment for natural spread  of the pest;  the presence of natural barriers;  
the potential for movement with commodities or co nveyances;  the intended use of the commodity;  
the potential vectors of the pest in the PRA area;  a nd the potential natural enemies of the pest in the 
PRA area.1708 
7.422  Part of the IRA's discussion on the different fact ors regarding the probability of spread has not 
been contested by New Zealand.  This includes, fo r example, the general description of the suitability 
of the natural and/or managed environment1709,  part of the discussion on natural barriers1710, the 
intended use of the commodity1711 and the potential natural enemies of the pest.1712  Dr Deckers and 
Dr Paulin concur with the IRA's assertion, in its  section on the suitability of the environment, that 
hailstorm injuries on plants would have a significant effect on the likelihood for spread of fire blight 
disease under natural conditions.1713 
7.423  Accordingly, the IRA's conclusions regardi ng the probability of spread seem generally 
coherent.  In any event, the value assigned to  such probability should be commensurate to the 
extremely low likelihood of transmissi on through the browsing insects scenario. 
Partial probability of establishment and spread  
7.424  Having discussed factors such as the viability of the pest, survival me chanism of the pest, 
transfer mechanism of the pest, inoculum dose, host receptivity and environmental factors, the IRA presents its conclusions regarding exposure: 
"The IRA team concluded that the exposure value for an individual apple for all five 
utility points by four exposure group combina tions should be in the range of Uniform 
(0, 10
–6).  This range is based on the IRA team's views on both mechanical and insect 
mediated transmission and explicitly acknowledges that in some circumstances the chances of exposure would be zero."
1714 
7.425  As noted by Dr Deckers, "[t]he step of the tr ansfer from these infected  fruits to the possible 
host plant stays the most critical step and will be difficult to prove."1715  The exposure value estimated 
by the IRA is supported on the preceding analysis  regarding the different relevant factors. 
7.426  Based on the discussion of the factors described earlier, the IRA also estimates the partial 
probabilities of establishment and spread for spec ific exposure groups:  commercial fruit crops, 
establishment – uniform (0.7, 1), spread – unifo rm (0.7, 1);  nursery plants, establishment – 
uniform (0.7, 1), spread – uniform (0.7, 1);  household and garden plants, establishment – 
                                                      
1707 Australia's IRA, Part B, p. 31. 
1708 Australia's IRA, Part B, pp. 31 and 93-95. 
1709 Australia's IRA, Part B, pp. 93-94. 
1710 Australia's IRA, Part B, p. 94. 
1711 Australia's IRA, Part B, p. 95. 
1712 Ibid. 
1713 Australia's IRA, Part B, p. 94.  See, for example, Dr Deckers's replies to Panel questions 15 and 18, 
in List of Replies from the scientific experts to qu estions posed by the Panel, paras. 117 and 135-136;  
Dr Deckers's and Dr Paulin's replies in Transcript of the Panel's meeting with experts, paras. 229, 307 and 351. 
1714 Australia's IRA, Part B, p. 90. 
1715 Dr Deckers's reply to Panel question 37, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 252.  WT/DS367/R 
 Page 295 
 
 
 uniform (0.3, 0.7), spread – uniform (0.3, 0. 7);  wild and amenity plants, establishment – 
uniform (0.3, 0.7), spread – uniform (5 × 10-2, 0.3).1716 
Conclusions regarding entry, establishment and spread  
7.427  The IRA combines in an @RISK model the partial probability estimate for importation, the 
estimated volume of apples and the partial probabi lity estimates for establishment and spread, to 
obtain an overall value for the annual probability of entry, establishment and spread (PEES).  The 
median simulated value for this probability of entr y, establishment and spread is estimated under the 
first scenario (if 70 to 100 per cent of imported a pples are distributed to orchard packing houses and 
the remainder to urban wholesalers) as (4.5 × 10-2) and under the second scenario (if 0.1 to 5 per cent 
of imported apples are distributed to orchard pack ing houses and the remainder to urban wholesalers) 
as (4.4 × 10-2), both corresponding to the qualitative description of "very low".1717 
7.428  The Panel has already noted that, with respect to several aspects of its discussion on exposure, 
establishment and spread, the IRA's reasoning seems at first glance generally coherent.  This is the case, for example, of the discussion on exposure regarding whether viable Erwinia amylovora  found 
on apple fruit could survive cold storage and transport (viability), whether Erwinia amylovora  found 
on apple fruit could survive in the environment (s urvival), and with respect to the environmental 
conditions required for successful disease establishment.   Similarly, with respect to a significant part 
of the IRA's discussion on establishment regarding th e availability of suitable hosts, alternate hosts 
and vectors, the description of the suitability of th e environment, the potential for adaptation of the 
pest and the cultural practices and control measures.  Likewise, with respect more generally to the 
IRA's discussion on spread.  All of these sections, how ever, rest on the assumption that at least some 
imported apples will be infested with Erwinia amylovora  bacteria. 
7.429  Throughout the discussion of the different factors, the IRA tends to exaggerate the risk, by not 
taking into account that any bacterial populations woul d likely be small, diminishing and not able to 
multiply and that no infection can occur unless host plan ts are in a susceptible stage meaning that they 
can be infected.  The IRA instead emphasizes a num ber of factors that would tend to increase the 
likelihood of entry, establishment and spread, desp ite the lack of adequate scientific evidence to 
support these factors or even in the face of available evidence to the contrary. 
7.430  Parties have extensively discussed the conclusions  that should be derived in this regard from 
studies by Hale et al.  (1996) and Taylor et al. (2003).
1718  New Zealand argues that these studies show 
that populations of Erwinia amylovora associated with mature fruit would have a negligible 
probability of infecting a host, even if the host were receptive.1719  Australia responds that these 
studies are of limited value, because the sample size was insufficient to detect rare events.1720  
Dr Deckers and Dr Paulin noted that it is normal th at the size of the samples for such detailed studies 
would be limited.1721  While the experts cautioned that the size of the sample was probably not enough 
to detect " very rare  events" and extrapolation of data to the spread of the disease under different 
natural conditions on a larger scale should be consider ed with prudence, they considered nevertheless 
that the studies allowed interesting conclusions  concerning the survival rate under different 
                                                      
1716 Australia's IRA, Part B, pp. 95-97. 
1717 Australia's IRA, Part B, p. 97. 
1718 Taylor et al., "Survival of the fire blight pathogen, Erwinia amylovora , in calyxes of apple fruit 
discarded in an orchard" (2003), in Exhibit NZ-28;  and, Hale et. al ., "Ecology and Epidemiology of fire blight 
in New Zealand" (1996), in Exhibit NZ-27. 
1719 New Zealand's first writte n submission, para. 4.243. 
1720 Australia's first written submission, paras. 472-476;  Australia's second written submission, 
para. 400. 
1721 Dr Deckers's and Dr Pau lin's replies to Panel question 43, in List of Replies from the scientific 
experts to questions posed by the Panel, paras. 274 and 275-276. WT/DS367/R 
Page 296  
 
 circumstances.
1722  At least, the studies demonstrate "tha t the fruits picked from a tree showing 
symptoms are usually  not surface contaminated with the bacteria, in these experimental 
conditions."1723  Moreover, if anything, the studies maximized  the theoretical risk of introduction of 
Erwinia amylovora  with potentially infested apples fruits , because each of the apples, placed in a 
blooming orchard, were inoculated with a significant level of bacterial population.  It is possible to 
conclude from these studies "that the 'leak ' of bacteria from fruit to blossoms does not normally take 
place ".1724 
7.431  The Parties have also discussed extensively th e conclusions that should be derived from a 
study by Roberts and Sawyer (2008).1725  New Zealand argues that this study shows that the risk of 
importing Erwinia amylovora  on commercial apple fruit and the concomitant risk of establishing an 
outbreak of fire blight is so small as to be insigni ficant.  Australia responds that this study is not 
relevant to the circumstances of the dispute, becau se it does not consider an unrestricted risk scenario, 
relies on flawed experimental data, and it applie s inappropriate confidence limits.  Dr Paulin 
expressed his opinion that the Roberts and Sawyer (2008) paper is "an interesting piece of serious 
reasoning about the quantification of the probabilit y of transport of fire blight with fruits." 1726  In his 
view, from the data collected, "the authors did their best to construct a sound reasoning with 
appropriate calculation".1727  Notwithstanding this, Dr Paulin c onsidered that, because of the many 
assumptions adopted, this paper would not "help objec tively in the dispute" and found it impossible to 
tell if the paper over or under-estimates the fire blight risk associated with fruits.1728  Dr Deckers 
agreed that the paper would not be helpful for th is Panel's analysis, because the samples considered 
are not representative of the New Zealand orchard s ituation of fire blight, because some fire blight 
control measures were taken but are not clearly descr ibed in the paper, and because some bacteria 
could be present as viable but not culturable (VBNC) or could be present at low levels difficult to 
detect.1729 
7.432  Little information is provided in the IRA on how the extensive discussion and review of 
different factors associated with the entry, estab lishment and spread, is then translated into 
quantitative estimates.  The Panel cannot attempt to  recalculate these estimates, as this would 
constitute a de novo  review exercise.  It cannot fail to note, however, that many of these estimations 
do not find support in the available scientific eviden ce and are not based on a coherent and objective 
reasoning.  In this respect, the Panel finds puzz ling that, under two, widely different scenarios 
regarding proximity, the IRA reaches relatively si milar conclusions on the probability of entry, 
establishment and spread.  As noted above, the IR A considers a first scenario, under which 70 to 100 
                                                      
1722 Dr Deckers's replies to Panel question 43, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 274. 
1723 Dr Paulin's reply to Panel question 43, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 275-276 (original emphasis). 
1724 Dr Paulin's reply to Panel question 43, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 275-276 (original emphasis).  See also, Dr Paulin's and Dr Deckers's replies in 
Transcript of the Panel's meeting with experts, paras. 382 and 383. 
1725 Roberts and Sawyer, "An updated pe st risk assessment for spread of Erwinia amylovora  and fire 
blight via commercial apple fruit" (2008), in Exhibit NZ-29.  See, for example, New Zealand's first written 
submission, paras. 4.26 and 4.251;  New Zealand' s second written submission, paras. 2.387-2.398;  
New Zealand's reply to Panel's question 64 after the first substantive meeting, paras. 108-113;  Australia's first 
written submission, paras. 363-376 and 401;  Australia's second written subm ission, paras. 330-337 and 
Annex 1. 
1726 Dr Paulin's reply to Panel question 41, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 268-270. 
1727 Ibid. 
1728 Ibid. 
1729 Dr Deckers's reply to Panel question 41, in List of  Replies from the scientific experts to questions 
posed by the Panel, paras. 264-267.  WT/DS367/R 
 Page 297 
 
 
 per cent of imported apples are distributed to or chard packing houses and the remainder to urban 
wholesalers, and a second scenario, under which only 0.1 to 5 per cent of imported apples are 
distributed to orchard packing houses.  The fact that imported infested apples are brought to rural 
packing houses in proximity to orchards could be  critical, as compared to apples being handled at 
urban wholesalers.  The IRA, however, reaches broadly similar conclusions, corresponding to the 
qualitative description of "very low", and estimates  almost identical probability values under both 
scenarios.1730 
7.433  The Panel recognizes that, in conducting risk assessments, Members frequently confront 
limitations in the availability of the data necessary for their models.1731  This is a real and a serious 
problem.  Members may try to estimate the answers if there is no data available, through the use of 
expert judgement.  Indeed, Australia argues that th is is how probabilities were estimated for several 
steps.1732 
7.434  In this respect, as cited by both Parties, the use of expert judgement in pest risk analysis is 
mentioned in ISPM No. 2 and ISPM No. 11.1733  ISPM No. 2 acknowledges that:  "Uncertainty is a 
component of risk and therefore important to recognize and document when performing PRAs.  
Sources of uncertainty with a particular PRA may include:  missing, incomplete, inconsistent or 
conflicting data;  natural variability of biological systems;  subjectiveness of analysis;  and sampling 
randomness."1734 
7.435  ISPM No. 2 recognizes that "[w]here information is insufficient or inconclusive, expert 
judgement may be used if appropriate."1735  ISPM No. 2 also adds, however, that "[t]he nature and 
degree of uncertainty in the analysis should be documented and communicated, and the use of expert 
judgement indicated."1736 
7.436  In accordance with ISPM No. 11, expert judge ment may be used to assess the probability of 
establishment or to assess the probability of spread.1737  In both cases, however, the estimation of 
those probabilities is to be based on "reliable biol ogical information ... obtained from the area where 
the pest currently occurs".1738  With respect to the assessment  of economic consequences, ISPM 
No. 11 indicates that "useful analyses can be based on non-monetary valuati ons ... or [on] expert 
judgement, if the analyses follow documented,  consistent and transparent procedures ".1739  Again, the 
                                                      
1730 Dr Sgrillo's reply to Panel question 46, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 296-297;  Dr Sgrillo's reply in Transcript of  the Panel's meeting with experts, 
para. 40.  See also, Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 42. 
1731 Dr Sgrillo's reply in Transcript of the Panel's meeting with experts, para. 191. 
1732 See, for example, Australia's first written subm ission, paras. 477 and 5 25;  Australia's second 
written submission, para. 401.  See also, Australia's opening  oral statement at the second substantive meeting of 
the Panel with the Parties, para. 12. 
1733 Australia's reply to Panel questions 29 and 31 af ter the second substantive meeting, paras. 152-153 
and 166-168. 
1734 Framework for pest risk analysis , 2007 (ISPM No. 2, FAO, Rome), p. 13, para. 3.1. 
1735 Framework for pest risk analysis , 2007 (ISPM No. 2, FAO, Rome), p. 13, para. 3.2. 
1736 Framework for pest risk analysis , 2007 (ISPM No. 2, FAO, Rome), p. 13, para. 3.1. 
1737 Pest risk analysis for quarantine pests, including analysis of environmental risks and living 
modified organisms , 2004 (ISPM No. 11, FAO, Rome), in Exhibit AUS-6, pp. 124 and 126, paras. 2.2.2 
and 2.2.3. 
1738 Ibid. 
1739 Pest risk analysis for quarantine pests, including analysis of environmental risks and living 
modified organisms , 2004 (ISPM No. 11, FAO, Rome), in Exhibit AUS-6, p. 129, para. 2.3.2.4. WT/DS367/R 
Page 298  
 
 standard notes that "[i]t is im portant to document the areas of uncertainty and the degree of 
uncertainty in the assessment, and to indicat e where expert judgement has been used."
1740 
7.437  The IRA contains a brief general section, in an  appendix titled "Overview of Bureau of Rural 
Sciences involvement  in New Zealand Apple Impor t Risk Assessment Process, on the "Elicitation of 
expert opinion", which states the following: 
"There were multiple discussions with the panel and Biosecurity Australia staff about 
the eliciting of expert opinion.  Three considerations were stressed by BRS [Australia's Bureau of Rura l Sciences].  They were: 
That Biosecurity Australia should be completely satisfied that the bounds of 
distribution chosen to represent their views would contain the true value. 
That the chosen distribution shape should re present expert views.  The interpretation 
of prior distributions in terms of gambling odds was discussed, and the uniform, triangular and Pert distributions presented as starting points. 
It was made clear that qualitative likelihood ranges should not constrain their options 
and that BRS was available to assist in expressing the experts' views if necessary. 
The issue of expressing divergent opinions was also discussed and different 
approaches to handling diverg ence of opinion were canvassed."
1741 
7.438  In response to a question from the Panel, Australia argued that: 
"[Because] expert judgment is used when there is limited evidence or where the 
underlying biological process is naturally highly variable, Australia does not believe it is correct to refer to 'errors' in expert judgment.  The use of the term 'error' assumes 
that there is a conclusive body of eviden ce against which the expert judgment can be 
assessed and the degree of 'error' determined.  However, the existence of such a body 
of evidence would mean that the use of expert judgment would not have been required to begin with."
1742 
7.439  The Panel disagrees with this interpretation.  Australia's argument seems to assume that risk 
assessments can occur in two distinct scenarios.  Th ere is either a conclusive body of evidence and 
expert judgement is not required or, on the contrary, such body of evidence does not exist and the use 
of expert judgement is not subject to scrutiny.  Rea lity is likely to be more complex.  On particular 
issues, a risk assessor may have the benefit of mo re or less abundant scientific evidence and yet still 
confront a degree of uncertainty on specific points, and the need to resort to expert judgement.  It may be relevant to note that, compared to other pome fruit diseases, there seem to be significantly more 
scientific studies on fire blight, as evidenced  in the reference list of the IRA itself.
1743 
                                                      
1740 Pest risk analysis for quarantine pests, including analysis of environmental risks and living 
modified organisms , 2004 (ISPM No. 11, FAO, Rome), in Exhibit AUS-6, pp. 129-130, para. 2.4. 
1741 Australia's IRA, Part B, p. 332.  See also, comment by Australia in Transcript of the Panel's 
meeting with experts, para. 146. 
1742 Australia's reply to Panel question 30 after the second substantive meeting, para. 162. 
1743 Australia's IRA, Part B, pp. 347-376.  In the Japan – Apples  dispute, for example, which related to 
fire blight, the Panel noted that on specific scientific que stions (such as the absence of endophytic bacteria in 
mature apple fruit and the risk of transmission of fire blig ht by apple fruit), "there is a large volume of relevant 
scientific evidence".  Panel Report on Japan – Apples , para. 8.220.  See also, Appellate Body Report on Japan – 
Apples , para. 181.  WT/DS367/R 
 Page 299 
 
 
 7.440  In any event, while expert judgement may be an important tool for the risk assessor, it is not a 
substitute for scientific data, especially for the purpose of estimating the likelihood of entry, 
establishment and spread of a pest.  In accordance with the relevant ISPMs, recourse to expert 
judgement does not substitute for the use of the ava ilable information.  The use of expert judgement 
must be documented and transparent;  it must be ba sed on the relevant reliable scientific information, 
even when that information is limited.  As noted by  one of the experts, if there is no data available, 
Members can refer to other available information, for example to other pests, where there may be 
some data.1744  Non-compliance with these requirements, may produce errors in the exercise of expert 
judgement.  It is not enough to claim, as Australia has done, that "[t]he IRA Team applied its expert 
judgment and elaborated its reasoning at every step in the Final IRA Report".1745  Rather, Australia 
would have had to demonstrate that the exercise of expert judgement was documented, transparent 
and based on the relevant reliable scientific information. 
7.441  The statements above should not be interpreted as an a priori  criticism of Australia's decision 
to resort to a semi-quantitative methodology fo r assessing the likelihood of entry, establishment and 
spread of the pests at  issue.  Under the SPS Agreement, Members are free to choose either a 
qualitative or a quantitative methodology, in accordance with the appropriate applicable standards.  
However, as noted by the experts consulted by the Panel, a quantitative methodology should only be 
used "when reliable specific numeric data are ava ilable" to support the choice of probability ranges 
and probability shapes.1746  In the absence of sufficient data, and particularly if numbers are chosen in 
an arbitrary manner, a quantitative method would only give a misleading impression of objectivity and precision.
1747 
7.442  Because of the lack of scientific evidence for many issues in the IRA, the experts consulted 
by the Panel were sceptical of the estimations for the exposure likelihood.  Dr Deckers, for example, 
noted that, for this aspect "there is no sufficient sci entific data available that describes the likelihood 
of this transfer possibility".1748  Dr Paulin added that "only some fragments of events are supported by 
scientific evidence.  Very often suppositions or speculations are proposed rather than certitudes".1749  
In the words of Dr Deckers, "you have no proof availa ble that this transfer can occur.  So, it is indeed 
speculation with, for me, a low leve l of likelihood to be a reality."1750  Dr Paulin concluded that, 
because these problems have never been addressed scientifically or at least experimentally, it is not possible "to rely objectively on any figure for the likelihood of this 'exposure' step."
1751 
                                                      
1744 Dr Schrader's reply in Transcript of the Panel's meeting with experts, para. 195. 
1745 Australia's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 16.  See also, Australia's first wr itten submission, paras. 74, 218 and 239. 
1746 Dr Sgrillo's reply to Panel question 128, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 728.  See also, Dr Sgrillo's re ply in Transcript of the Pa nel's meeting with experts, 
para. 122;  Dr Schrader's reply to Panel question 124, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 700. 
1747 Dr Sgrillo's reply to Panel question 128, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 730.  See, OIE, "Handbook on Import Risk Analysis for Animals and Animal 
Products.  Volume 1:  Introduction and qualitative risk assessment" (2004), pp. 27-28, in Exhibit NZ-47. 
1748 Dr Deckers's reply to Panel question 36, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 245.  See also, Dr Sgrillo's reply to Panel question 36, in List of Replies from the 
scientific experts to questions posed by the Panel, paras. 247-251. 
1749 Dr Paulin's reply to Panel question 36, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 246. 
1750 Dr Deckers's reply in Transcript of the Panel's meeting with experts, para. 242. 
1751 Dr Paulin's reply to Panel question 36, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 246.  See also, Dr Paulin's reply in Transcript of the Panel's meeting with experts, 
para. 240. WT/DS367/R 
Page 300  
 
 7.443  Generally speaking, the experts were sceptical of the likelihood of introduction of fire blight 
through mature apple fruit.  None of the experts consulted found any adequate scientific evidence in 
the IRA to support the proposition that this has occurred or could occur.
1752  There is even less 
evidence for the further step of transfer from this imported bacterial population to a new plant in 
Australia.1753  Dr Paulin acknowledged that, as a scientist , he could not exclude that such scenario 
may happen1754: 
"Australia has shown that you can imagine a system in which mature apple fruits can 
carry the bacteria from New Zealand to Austra lia.  The point is that it is difficult to 
estimate the value of 'can'.  Is it a rare possibility, a frequent event or something exceptional?  This is far more difficult to tell. ... [A]nything which goes from 
New Zealand or from a contaminated c ountry to another country 'can' carry 
something including bacteria, including pathogenic bacteria, that is the minimum level.  Then you may have specific transport of specific bacteria, e.g., with rootstock 
material which would be the maximum dange r for the installation of the disease in a 
new country.  So, the apple fruit, which is  in-between these two limits, cannot be 
excluded.  That that can be considered as  a real risk, is the matter in question."
1755 
7.444  Dr Deckers agreed that, in other countries trying to  limit the risk of introduction of fire blight, 
"they are not talking in the first place about fruits , they are talking more about plant material and 
potential infections on plant material, root stock or variety materials".1756 
7.445  In other words, the experts did not consider that  the IRA contains adequate scientific evidence 
to support the proposition that the introduction of fire  blight via mature apple fruit has occurred or 
could occur.  At the same time, th ey agreed that there is a theoretic al possibility of the importation of 
bacteria with apple fruit.  They found even less lik ely the further step of transfer from this imported 
bacterial population to a new plant in Australia.  Th e likelihood of introduction via mature apple fruit 
would, in any event, be less than that of introduction via plant material or root stock.  In the words of 
Dr Paulin: 
"[T]he risk represented by the total pro cess, is probably of the same order of 
magnitude as the transport of contaminated insects by natural way from New Zealand to Australia by air jet or things like that. ... [T]here is a possibility [of introducing Erwinia amylovora  through mature apple fruit] which level of risk is not far higher 
than the natural spreading possibility of the bacteria to go from place to another with 
something else ... which has no connection with trade of apples."
1757 
7.446  In the light of the above, the Panel finds that  New Zealand has not successfully made a prima 
facie case that the IRA's estimation of the likelihood that Erwinia amylovora  survives routine 
processing procedures in the packing hou se (importation step 4);  and that Erwinia amylovora  
survives palletization, quality inspection, containeri zation and transportation to Australia (importation 
                                                      
1752 Dr Paulin's reply to Panel question 37, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 253. 
1753 Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 380. 
1754 Dr Paulin's reply to Panel question 37, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 253.  See also, reply of Dr Paulin in Transcript of the Panel's meeting with experts, 
para. 380. 
1755 Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 226.  See also, reply of 
Dr Paulin in Transcript of the Panel's meeting with experts, para. 254. 
1756 Dr Deckers's reply in Transcript of the Panel' s meeting with experts, para. 379.  See also, 
Dr Deckers's reply to Panel question 16, in List of Replies from the scientific experts to questions posed by the Panel, para. 123. 
1757 Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 380.  WT/DS367/R 
 Page 301 
 
 
 step 6), are exaggerated, and that these estimations do not rely on adequate scientific evidence or are 
not coherent and objective.  The Panel finds also that the IRA's conclusion that the likelihood that 
clean fruit is contaminated by Erwinia amylovora  during palletization, quality inspection, 
containerization and transportation (importation step 7) is negliglible appears to be coherent and 
objective.  The Panel finds additionally that New Zealand has not made a prima facie case that the 
IRA's discussion on utility points and estimates of proximity ratings for the combination of each 
utility point with exposure groups (proximity values) , or that the IRA's conclusions regarding the 
probability of spread, do not rely on adequate scien tific evidence or are not coherent and objective. 
7.447  The Panel finds, however, that the IRA's estimation that Erwinia amylovora  will be always 
present in the source orchards in new Zealand (impor tation 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 or chards 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.  In the light of 
these findings and the absence of any separate just ification and evidence in the IRA regarding the 
estimated overall likelihood of importation, the Panel finds additionally that the IRA's estimation of 
the overall probability of importation is not su pported by adequate sci entific evidence and, 
accordingly, is not coherent and objective. 
7.448  The Panel also notes that a significant pa rt of the IRA's discussions on exposure, 
establishment and spread of fire blight, rests on a number of assumptions and qualifications.  As noted 
above, some of these assumptions and qualifications are not convincing, which leads to reasonable 
doubts about the evaluation made by the risk asse ssor.  The IRA has not properly considered a 
number of factors that could have a major impact on the assessment of this particular risk.  Accordingly, the Panel finds that the reasoning artic ulated in Australia's IRA, with respect to the 
likelihood of entry, establishment and spread of fire  blight, including the IRA's estimation of the value 
for the respective probabilities, does not rely on adeq uate scientific evidence and, accordingly, is not 
coherent and objective. 
(k) Potential biological and economic conse quences associated with fire blight 
(i) Summary of the Parties' arguments 
7.449  New Zealand argues that the IRA's conclusi on that the overall consequence of the 
introduction and establishment of fire blight  would be "high" is "reached on the basis of selectively 
chosen evidence and on assumptions that have  no basis in scientific evidence or fact".
1758 
7.450  New Zealand considers that the IRA's estim ates of monetary losses from a fire blight 
incursion across Australia are based on unsubstant iated assumptions on the rate and scope of the 
disease that lead to exaggerated estimat es of the nationwide impact and losses.1759  New Zealand also 
disputes the IRA's proposition that the impact of fire blight will be severe every year.1760  It notes the 
existence of commercially available products for re ducing the incidence of fire blight, as well as the 
presence of other bacteria that would aggressively compete with Erwinia amylovora  for nutrients and 
space on a susceptible host.1761  New Zealand also submits that the impact of fire blight on pipfruit 
                                                      
1758 New Zealand's first writte n submission, para. 4.254. 
1759 New Zealand's first writte n submission, para. 4.255. 
1760 New Zealand's first writte n submission, para. 4.256. 
1761 New Zealand's first writte n submission, para. 4.257. WT/DS367/R 
Page 302  
 
 production in New Zealand in non-outbreak years is inconsequential.
1762  In New Zealand's view, the 
evidence shows that pipfruit production losses from a fire blight outbreak are not discernible at the 
national and regional level, and are lik ely to be minor at a district and local level in most years.  Such 
production losses may occasionally be significant at a local level only.1763  New Zealand also rejects 
Australia's contentions on the indirect impact on control or eradication, surveillance/monitoring and 
compensation strategies.1764  Finally, New Zealand argues that the IRA's estimates of the indirect 
impact on international trade, and on communities in Australia, amount to no more than conjecture.
1765 
7.451  In New Zealand's view, the result is that the IRA overestimates the consequences of the 
establishment and spread of fire blight.  "A more realistic assessment, relying on the actual experience 
of countries where fire blight is present, would ha ve resulted in the overall consequences being 'very 
low'."1766 
7.452  Finally, New Zealand argues that it "accepts that fire blight certainly can have serious 
consequences".  In its view, however, "the important  thing to bear in mind is that the disease is not 
spread by exports of mature fruit."1767 
7.453  In response, Australia argues that the IRA's analysis of the potential consequences of the 
introduction and establishment of fire blight is objective and credible.  Australia submits in this regard 
that "fire blight is one of the most serious diseases of pome fruit trees in the world".1768  Australia adds 
that:  "[c]ontrol action in orchards against fire  blight would be costly, requiring expenditure on 
chemical inputs, pruning and other aspects of plant hygiene.  Indirect costs include ongoing surveillance and, if an outbreak were to occur, the costs of attempting eradication, as well as flow-on 
losses to other industries."
1769 
7.454  Australia argues further that the IRA comprehensively addressed relevant factors and 
evidence in evaluating the consequences from fire blight.1770  The IRA evaluated reported losses from 
fire blight outbreaks in New Zealand and othe r countries, in particular, the United States.1771  
New Zealand ignores the range of reports considered by the IRA1772;  instead, it relies on a few 
selective examples that, taken in isolation, misreprese nt the potential impact of the disease, in order to 
attempt to downplay the potential production losses.1773  In Australia's view, significant numbers of 
trees can be lost in a fire blight outbreak.1774  Australia adds that New Zealand assumes that its own 
                                                      
1762 New Zealand's first written submission, paras. 4. 256-4.258.  New Zealand's reply to Panel question 
67 after the first substantive meeting, paras. 144 and 148. 
1763 New Zealand's first written s ubmission, paras. 4.259-4.261. 
1764 New Zealand's first written s ubmission, paras. 4.262-4.263. 
1765 New Zealand's first written submission, para. 4.2 64;  New Zealand's reply to Panel question 67 
after the first substantive meeting, para. 151. 
1766 New Zealand's first writte n submission, para. 4.264. 
1767 New Zealand's reply to Panel question 67 after the first substantive meeting, para. 141.  See also, 
New Zealand's second written submission, paras. 2.455-2.456. 
1768 Australia's first written submission, para. 493. 
1769 Australia's first written submission, para. 494. 
1770 Australia's first written submission, para. 496. 
1771 Australia's first written submission, para. 498. 
1772 Australia's first written submission, paras. 500-505. 
1773 Australia's first written submission, para. 497. 
1774 Australia's first written submission, para. 499.  WT/DS367/R 
 Page 303 
 
 
 experience with fire blight will be replicated in Australia.1775  At the same time, however, 
New Zealand discounts the impact of the fire  blight outbreak in Hawke's Bay in 1998.1776 
7.455  Australia submits that New Zealand downplays th e costs of control, eradication and tree 
replacement.1777  It also overplays its own international tr ade experience;  despite its claim that other 
countries do not constrain access for its apples, Au stralia argues that there are examples to the 
contrary.1778 
7.456  On the basis of these arguments, Australia re jects New Zealand's claim that the IRA Team 
failed to evaluate the potential biol ogical and economic consequences of fi re blight in Australia.  In its 
view, New Zealand has failed to engage with the lit erature and evidence considered by the Team;  it 
has instead sought to build an alternate case th at rests on an assumption that New Zealand's 
experience of fire blight will be replicated in Australia.1779  Australia also argues that New Zealand 
made no substantive argument on the issue of the con sequences of fire blight, either in its second 
written submission or at the second substantive meeti ng with the Panel;  therefore, Australia considers 
that the point is undisputed.1780 
7.457  Australia concludes that New Zealand failed to identify any flaws in the IRA Team's 
conclusions on consequences, let alone any flaws serious enough to prevent the Panel from having 
"reasonable confidence" in the risk assessment.1781 
(ii) The Panel's analysis 
7.458  The assessment in the IRA of the potential biological and economic consequences associated 
with fire blight is based on the consideration of a number of direct and indirect criteria.  The direct 
criteria include plant life or health, human life or health and any other aspect s of the environment.  
The indirect criteria include control or eradication,  domestic trade or industry, international trade, 
environment and communities.  The IRA allocates impact  scores for each direct and indirect criterion.  
The impact scores are from the least significant "A" to the most significant "G". 
7.459  Regarding the direct criteria.   On plant life or health, the IRA allocates an impact score of 
"F".  The IRA considers the consequences of fire bli ght affecting plant life or health to be significant 
at a national level, and highly significant at a regional level.1782  On human life or health, the IRA 
allocates an impact score of "A".  The IRA not es that there are no known direct impacts of Erwinia 
amylovora  on human life or health.1783  On any other aspects of the environment, the IRA allocates an 
impact score of "A".  The IRA notes that there are no known other direct impacts of Erwinia 
amylovora  on the environment.1784 
                                                      
1775 Australia's first written submission, paras. 506-507;  Australia's second written submission, 
paras. 411-412 and 420-424. 
1776 Australia's first written submission, paras. 508-512.  See also, Australia's second written 
submission, paras. 417-418. 
1777 Australia's first written submission, paras. 513-518;  Australia's second written submission, 
para. 419. 
1778 Australia's first written submission, paras. 519-521. 
1779 Australia's first written submission, paras. 522-523. 
1780 Australia's closing oral statement at the second substantive meeting of the Panel with the Parties, 
para. 12. 
1781 Australia's first written submission, para. 523;  Australia's second written submission, para. 425. 
1782 Australia's IRA, Part B, pp. 98-100. 
1783 Australia's IRA, Part B, p. 100. 
1784 Ibid. WT/DS367/R 
Page 304  
 
 7.460  Regarding the indirect criteria.   On control and eradication, the IRA allocates an impact score 
of "E".  The IRA considers that the indirect impact of fire blight on new or modified eradication, control, surveillance/monitoring and compensation strategies would be minor at a national level, 
significant at a regional level and highly significant at the district level.
1785  On domestic industry, the 
IRA allocates an impact score of "E".  The IRA considers that the indirect impact of fire blight on 
domestic trade or industry would be minor at a nati onal level, significant at a regional level and highly 
significant at the district level.1786  On international trade, the IRA allocates an impact score of "D".  
The IRA considers that the indirect impacts of fire blight on international trade would be unlikely to 
be discernible at a national level, would be of minor significance at a regional level, significant at the district level and highly significant at the local level when the economy of the respective levels is 
considered.
1787  On the environment, the IRA allocates an impact score of "A".  The IRA notes that 
any indirect impacts of fire blight on th e environment are unlikely to be discernible.1788  O n  
communities, the IRA allocates an impact score of "D".   The IRA considers that the indirect impact of 
fire blight on communities would be  unlikely to be discernible at a na tional level, would be of minor 
significance at a regional level, significant at the district level and highly significant at the local 
level.1789 
7.461  Considering these impact scores, the IRA concludes that the overall potential biological and 
economic consequences should be rated as "high".1790 
7.462  Furthermore, by combining the value for the annual probability of entry, establishment and 
spread and the outcome of overall consequences, th e IRA estimates that the unrestricted annual risk 
for imported apples from New Zealand is "low".  Th e rating of "low" unrestricted annual risk is the 
same under the two different scenarios considered by the IRA.  As noted above, the IRA considers a 
first scenario, under which 70 to 100 per cent of impo rted apples are distributed to orchard packing 
houses and the remainder to urban wholesalers, a nd a second scenario, under which only 0.1 to 5 per 
cent of imported apples are distributed to orchard packing houses.  This rating of "low" is above Australia's ALOP of "very low".  Accordingly, th e IRA concludes that "risk management would be 
required for this pest".
1791 
7.463  The experts consulted by the Panel are sceptical  about the impact scores assigned by the IRA 
to some criteria.  Dr Paulin noted that it may be easier to know in advance what the susceptibility is of 
a plant to a particular pest:  whether the plant is r eceptive to the disease or not.  It is also possible to 
know if bacteria are present or not, but: 
"It is far more difficult to predict what will be the severity of the disease, in terms of 
damage which is expected.  For example, in  Europe we have been quite surprised to 
see that fire blight is a very serious disease of apple in Germany, where it was expected to be a serious disease of pear in the South of France, if you just look at the 
climatic conditions and the susceptibility of th e cultivars.  That means that there are 
some elements which are just missing and you can predict for sure that the disease 
will be able to develop, but it is far more  difficult to quantify this development in 
terms of economic loss."
1792 
                                                      
1785 Australia's IRA, Part B, pp. 100-101. 
1786 Australia's IRA, Part B, p. 102. 
1787 Australia's IRA, Part B, pp. 102-103. 
1788 Australia's IRA, Part B, p. 103. 
1789 Australia's IRA, Part B, pp. 103-104. 
1790 Australia's IRA, Part B, p. 104. 
1791 Australia's IRA, Part B, pp. 104-105. 
1792 Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 300.  WT/DS367/R 
 Page 305 
 
 
 7.464  Dr Paulin was particularly critical of the most severe impact scores assigned by the IRA to 
some of the criteria.  Regarding the consequences of fire blight affecting plant life or health, which the 
IRA rated "F", one of the most severe scores, Dr Paulin expressed doubts about fire blight being considered the most serious disease of apple:  "A pple scab would be probably considered as more 
costly in many areas.  But fire blight is undoubtedly the most serious bacterial  disease of apple and 
pear."
1793  The expert also noted that it is "impossibl e to predict the economical consequences of the 
introduction of fire blight in a new area".1794  "The severity of the disease (the importance of damages) 
is the result of the combination of three factors (at least) at the local level:  climate, cultivar 
susceptibility (genetic), cultivar r eceptivity.  If each can be evaluated (at least for trends) the 
combination of the three to give a reasonable prediction is non realistic."1795 
7.465  In any event, Dr Paulin noted th at it is just not possible, and it has never been seen, that fire 
blight would be devastating to the same degree in every place and on every plant as soon as introduced in a new area.  Moreover, the spread of  the disease, even if not eradicated, would be 
relatively slow, and the invasion, if any, should  be progressive.  The damage to crops would be 
difficult to estimate.  Dr Paulin noted further that  in France, there have not been a large number of 
bearing trees of apple killed by fire blight, in spite of the high susceptibility of some French varieties.  
The situation is different for pear varieties, but the disappearance of entire trees due to fire blight 
remains limited to only a few varieties.  The overa ll production of fruits in a whole country has never 
been seriously decreased, even by a severe fire blight epidemic, even if the damage can be very costly 
at the local level, in certain years for certain varieti es.  The expert concluded th at "the impact score of 
'F' could be exaggerated."
1796 
7.466  Regarding the consequences of fire blight affec ting domestic trade, which the IRA rated with 
a severe score "E", Dr Paulin noted that:  "[g]iven  the likely low impact at the national level of the 
disease on overall production, the losses for domestic  trade or industry look exaggerated and 
unrealistic."1797 
7.467  Regarding the consequences of fire blight aff ecting international trade, which the IRA rated 
with a severe score "D", Dr Pau lin noted that the impact could be significant on the export of 
nurseries, due to quarantine restrictions.  This, however , is not considered in th e IRA.  "The impact on 
fruit trade will be limited, especially if the eradica tion methods are effective (it will not be possible to 
consider any apple orchard of Australia as infected by  fire blight).  Again the rating of 'D' seems too 
high."1798 
7.468  It is not the Panel's role to reassess the imp act scores assigned by the IRA to specific criteria 
and propose different scores.  In any event, most  of New Zealand's arguments with respect to the 
IRA's estimation of consequences assume that fire bl ight would behave in the same way if introduced 
in Australia as has been observed in other regions.  As noted by Dr Paulin, however, it is "impossible 
to predict the economical consequences of the introduction of fire blight in a new area".1799 
                                                      
1793 Dr Paulin's reply to Panel question 11, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 87. 
1794 Ibid. 
1795 Ibid. 
1796 Ibid.  But see, Dr Deckers's reply to Panel question 11, in List of Replies from the scientific experts 
to questions posed by the Panel, para. 85. 
1797 Dr Paulin's reply to Panel question 11, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 91. 
1798 Dr Paulin's reply to Panel question 11, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 92. 
1799 Dr Paulin's reply to Panel question 11, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 87. WT/DS367/R 
Page 306  
 
 7.469  It must be noted that, according to the experts consulted by the Panel, the IRA has a tendency 
to overestimate the severity of the consequences of fi re blight in certain aspects.  This overestimation 
affects in particular two of the criteria, which in  the IRA are assigned the most severe scores of "F" 
and "E" (plant life or health and dome stic trade or industry, respectively). 
7.470  In the light of the above, the Panel concludes that the IRA's evaluation of the potential 
consequences associated with the en try, establishment or spread of fire blight into Australia does not 
rely on adequate scientific evidence and, acco rdingly, is not coherent and objective. 
(l) Overall conclusions with respect to th e requirements regarding fire blight 
7.471  For the reasons stated above, the Panel finds that, with respect to its analysis of the likelihood 
of entry, establishment and spread of fire blight, an d of the potential conseque nces associated with the 
entry, establishment or spread of fire blight in to Australia, Australia's IRA is not a proper risk 
assessment within the meaning of Article 5.1 and paragraph 4 of Annex A of the SPS Agreement.  
The flaws described above also cons titute a failure by the IRA to take sufficiently into account factors 
such as the available scientific evidence, th e relevant processes and production methods in 
New Zealand and Australia, and the actual prevalence of fire blight, as required by Article 5.2 of the 
SPS Agreement. 
7.472  Accordingly, Australia's requirements regard ing fire blight on New Zealand apples are 
inconsistent with Articles 5.1 and 5.2 of the SPS Ag reement.  Since the requirements are not based on 
a risk assessment as provided in Article 5.1 of the SPS Agreement, these measures can be presumed, 
more generally, not to be ba sed on scientific principles within the meaning of Article 2.2.
1800  
Accordingly, the Panel finds that Australia's re quirements regarding fire blight on New Zealand 
apples are, by implication, also inconsistent  with Article 2.2 of the SPS Agreement". 
(m) Alleged methodological flaws identified by New Zealand 
7.473  The Panel has found that, with respect to its an alysis of the likelihood of entry, establishment 
and spread of fire blight, Australia's IRA is not a proper risk assessment and, consequently, Australia's 
requirements regarding fire blight on New Zealand ap ples are inconsistent with  Articles 2.2, 5.1 and 
5.2 of the SPS Agreement.  Normally, there would be  no need to proceed further with an examination 
of New Zealand's additional argument that the IRA contains methodological flaws that result in a vast overestimation of the probability of entry, establishment and spread of fire blight into Australia through apples from New Zealand.  However, Ne w Zealand's arguments regarding methodological 
flaws in the IRA would concern, not only Australia's  requirements regarding fire blight, but also the 
requirements regarding European canker and the "gen eral" requirements.  Accordingly, the Panel will 
examine New Zealand's arguments regarding the methodological flaws in the IRA. 
(i) Choice of maximum value for negligible events 
Summary of the Parties' arguments
 
7.474  New Zealand has identified the IRA's choice of  the maximum value for the probability of 
events with a negligible likelihood of occurring, as a methodological flaw that, in combination with 
other flaws, would result in an overestimation of th e probability of entry, establishment and spread of 
the pests at issue.1801 
                                                      
1800 Appellate Body Report on Australia – Salmon , paras. 137-138. 
1801 New Zealand's first wr itten submission, para. 4.172.  S ee also, New Zealand's first written 
submission, para. 4.174-4.186;  New Zealand's second written submission, para. 2.333-2.352.  WT/DS367/R 
 Page 307 
 
 
 7.475  New Zealand contends that the numerical ranges adopted under the IRA as probability 
intervals for the qualitative descriptions of various ev ents were assigned arbitrarily.  Little insight was 
provided as to how those ranges were determined.1802  In the case of even ts with a "negligible" 
likelihood of occurring ("the event would almost cert ainly not occur"), the maximum value was set at 
one in a million (1 × 10-6). 
7.476  New Zealand argues that the maximum value of 1 × 10-6 is "substantially greater" and "at 
least three orders of magnitude (i.e. 1,000 times) greater" than can be concluded on the basis of 
known data".1803  In New Zealand's view:  "the effect of Australia's choice of 1 × 10-6, combined with 
[the] choice of the uniform distribution to model ke y events with a negligible likelihood of occurring, 
is that events that 'almost certainly will not occur' ar e turned into events that will be expected to occur 
["relatively frequently", i.e.,] approximate ly once in every two million apples imported."1804 
7.477  In response, Australia argues that "any choice of intervals is arbitrary".1805  In Australia's 
view, because the term "negligible" is define d in the IRA through numbers represented by a 
probability interval, the focus should be on t hose numbers and not on the word "negligible".1806  
Australia adds that the IRA focused  on the interval between 0 and 10-6 as a uniform distribution, and 
not on the maximum value of 10-6.1807  In Australia's view, "[t]his means that the probability of a 
particular event occurring is equally likely to be any probability value within the interval bounded by 
the minimum and maximum values of the distribution.  In other words, the probability of an event happening is equally likely to be zero as one in a million or any value in between."
1808 
7.478  Australia finally argues that there are a numbe r of flaws in New Zealand's reliance on trade 
data to support its position regarding the use of 1 × 10-6 as the maximum value for "negligible".  To 
begin with, the IRA had to assess the potential volume of trade that would occur between 
New Zealand and Australia, and not the existing tr ade between New Zealand and Chinese Taipei.  
Further, it is unclear whether in its argument New Zealand has gone beyond th e trade data to address 
factors within Chinese Taipei, such as the occurrence of fire blight host plants, environmental factors, 
distribution systems, consumption patterns, disposal routes and location of packing houses.1809 
The Panel's analysis  
7.479  The IRA uses a semi-quantitative approach to assess the risk associ ated with the three pests at 
issue in this dispute, including fire blight.  The semi-quantitative appro ach combines a quantitative 
estimation of the probability of entry, establishm ent and spread of the pest with a qualitative 
evaluation of the associated potential consequences.1810  Table 12 of Part B of the IRA sets out the 
"[n]omenclature for qualitative likelihoods, co rresponding semi-quantitative probability intervals".1811  
This table shows for example that a "negligible " likelihood corresponds to the qualitative descriptor 
"[t]he event would almost certainly not occur", a probability interval of 0 to 10-6 (zero to one in one 
million), and a midpoint (if uniform distribution is used) of 5 x 10-7 (0.5 in one million, or one in two 
million).1812 
                                                      
1802 New Zealand's first writte n submission, para. 4.175. 
1803 New Zealand's first written s ubmission, paras. 4.182-4.186. 
1804 New Zealand's first writte n submission, para. 4.178. 
1805 Australia's second written submission, para. 246. 
1806 Australia's first written submission, para. 298. 
1807 Australia's first written submission, paras. 299-300 and 307. 
1808 Australia's first written submission, para. 300. 
1809 Australia's first written submission, paras. 308-311. 
1810 See para. 2.61 above. 
1811 Australia's IRA, Part B, p. 43.  See para. 2.65 above. 
1812 Australia's IRA, Part B, p. 43.  Australia's first written submission, para. 115.  See para. 2.65 above. WT/DS367/R 
Page 308  
 
 7.480  Both Parties agree that the IRA's choice of a pr obability interval of zero to one in one million 
for events with a "negligible" likelihood of o ccurring was arbitrary.  Just because the choice was 
ultimately arbitrary, however, does not mean that the values chosen should not have been based on 
relevant information, including available scientific ev idence.  Moreover, the Panel is not convinced by 
Australia's argument that words are irrelevant a nd that the focus should only be on the numbers 
representing probability intervals in the IRA.  If a cate gory of events is define d as "negligible" and the 
IRA describes that category as representing events  that "would almost certainly not occur", any 
numbers that are assigned to the corresponding quant itative probability intervals should be consistent 
with that definition.  Otherwise, ad absurdum , Australia's argument could lead to negligible events 
being assigned a quantitative representation of one, m eaning that in practice the event would always 
happen. 
7.481  Unfortunately, the IRA provides little insight on how the probability values were assigned to 
each of the six qualitative descriptors, including the "negligible" category.
1813  In particular, there is no 
explanation of why events that would almost cer tainly not occur were assigned a numerical maximum 
value of one in a million.  As noted by Dr Sgrillo, "[t]here is no scientific base to support the 
exclusive choice of 1E-6 because other ranges, as 0 to  1E-9 or to 2E-6, could also [have been] used … 
without violating any scientific principle".1814  The same expert noted that "[t]he probability interval 
seems to have been arbitrarily chosen to repres ent the qualitative descriptors.  There are no perceived 
criteria for assigning probabilities intervals to the qua litative scale.  No mathematical relationship 
between the categories was found … This approach see ms to be based in an arbitrary choice and not 
in scientific principles".1815  Dr Sgrillo added: 
"[I]n the case of assigning numbers to  probabilities, the numbers you are assigning 
represent a hypothesis about the real process in the world.  And when you assign these numbers you should be based on numbers from sampling of the reality.  Otherwise you are elaborating on the subject . ... [I]f you don't have numbers that were 
sampled in the real world, you have no guarantee that the numbers that you are 
assigning are representative.  It's a hypothesis,  after all.  A common sense hypothesis, 
an elaborated hypothesis, but it follow s that it's a hypothesis, no guarantee."
1816 
7.482  Accordingly, the first failing in the IRA's defi nitions of quantitative probability intervals for 
qualitative likelihoods is the lack of  information on how those numbers were assigned.  Additionally, 
the Panel must determine whether New Zealand has properly made the case that the interval 
corresponding to "negligible" events is greater than can be justified and that this would result in an 
overestimation of the probability of entry, estab lishment and spread of the pests at issue. 
7.483  In this respect, Dr Latorre identified "the ra nge used to numerically explain the negligible 
descriptor"as "[o]ne of the main weaknesses" in the IRA.1817  The term "negligible" is not defined in 
the WTO agreements with respect to the likeli hood of biological events under the SPS Agreement, 
nor are there any relevant international standards,  guidelines or recommendations  to define this term, 
nor on the number or width of probability intervals that may be used.1818  In any event, the ordinary 
                                                      
1813 Dr Latorre's reply to Panel question 133, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 766. 
1814 Dr Sgrillo's reply to Panel question 134, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 767. 
1815 Dr Sgrillo's reply to Panel question 133, in List of  Replies from the scientific experts to questions 
posed by the Panel, paras. 755 and 765. 
1816 Dr Sgrillo's reply in Transcript of th e Panel's meeting with experts, para. 34. 
1817 Dr Latorre's reply to Panel question 133, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 766. 
1818 Dr Schrader's and Dr Sgrillo's replies in Transcri pt of the Panel's meeting with experts, paras. 46 
and 204.  See also, Dr Sgrillo's reply to Panel question 13 3, in List of Replies from the scientific experts to  WT/DS367/R 
 Page 309 
 
 
 meaning of the term "negligible" is something that  is "[a]ble to be negl ected or disregarded;  
unworthy of notice or regard;  so small or insignificant as to be ignorable".1819  In other words, 
"negligible" is something so small that it can be ignored.1820  The IRA itself defines "negligible" 
events as events that "would almost certainly not  occur".  In other words, the probability of a 
negligible event would be close to zero, but different from zero.1821  As noted by Dr Latorre: 
"[B]y no means can a negligible event range from 0 to a maximum of 1 × 10-6 with a 
midpoint of 5 × 10-7.  In doing so, the likelihood of a particular biological event is 
overestimated.  As stated before, 5 × 10-7 is a relatively high probability value, even 
considering the lowest possible total volume of apples (50,000,000, AUS-2 p.19) that can ultimately be imported from New Zealand."
1822 
7.484  Considering that the likelihood of negligible ev ents is defined in the IRA as events that 
"would almost certainly not occur" and not as events that "would not occur", the numerical equivalent should be different from zero.  Accordingly, such cat egory can be included in the model.  It should, 
however, "be included with values coherent  with the definition of negligible".
1823  Because there is 
little indication in the IRA on how the numerical pr obability values were assigned to the "negligible" 
category, such values are not properly justified in the IRA and would tend to overestimate the 
probability of entry, establishment and spread of the pests at issue.  As noted by Dr Latorre: 
"[T]he probability values given in Table 12 [should be reviewed] accepting that the 
maximum probability to be assigned to a neglig ible event should be such that one can 
be almost certain that this event will not occur in a given population, and that the 
minimum value should be different from zero.  Then probability values for other 
descriptors can be assigned, considering th at if an event has a probability of one, 
there is certainty that the event will occur."1824 
(ii) Use of uniform distribution to model the likelihood of events 
Summary of the Parties' arguments  
7.485  As noted above, New Zealand has identified th e IRA's "inappropriate use of [a] uniform 
distribution to model the likelihood of events, par ticularly those with a 'negligible' likelihood of 
occurring" as a methodological flaw that, in comb ination with other flaws, would result in an 
overestimation of the probability of entry, est ablishment and spread of the pests at issue.1825 
7.486  New Zealand argues that "[a] uniform  distribution ... is the crud est possible distribution for 
modelling a range of estimates.  In this distribu tion every value between the maximum and minimum 
value is equally likely to occur.  There is no 'most likely' value."1826  Under the IRA, "negligible" 
events were given a uniform distribution with zero as the minimum and one in a million as the 
                                                                                                                                                                     
questions posed by the Panel, para. 753;  and Dr Sgrillo 's replies in Transcript of the Panel's meeting with 
experts, paras. 50 and 206. 
1819 The New Shorter Oxford English Dictionary  (Clarendon Press, 1993), Vol. II, p. 1900. 
1820 Dr Sgrillo's reply in Transcript of th e Panel's meeting with experts, para. 50. 
1821 Dr Latorre's reply in Transcript of the Panel's meeting with experts, para. 48. 
1822 Dr Latorre's reply to Panel question 133, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 766. 
1823 Dr Sgrillo's reply in Transcript of the Panel's meeting with experts, para. 138. 
1824 Dr Latorre's reply to Panel question 133, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 766. 
1825 New Zealand's first wr itten submission, para. 4.172.  S ee also, New Zealand's first written 
submission, para. 4.187-4.193;  New Zealand's second written submission, para. 2.353-2.358. 
1826 New Zealand's first writte n submission, para. 4.189. WT/DS367/R 
Page 310  
 
 maximum;  the mid-point of this distribution is set at one event in every two million samples.  
New Zealand notes that, under this approach, "an even t that 'would almost certainly not occur' will in 
fact be expected to occur on average approximately  once in every two million samples. ... Negligible 
is no longer negligible under this approach."
1827 
7.487  New Zealand concludes that "[t]he result of applying a uniform distribution to model events 
with a negligible likelihood of occurring is that Australia predetermined that the value chosen was 
weighted towards the event occurring.  As a result, Australia has artificially inflated the risks of such 
events occurring in most if not all cases."1828 
7.488  In New Zealand's view, the IRA could have avoided this by either choosing a lower 
maximum value for negligible events, with a correspondingly lower mid-point, with a resulting 
smaller probability range.  In this case, the probabi lity values used as inputs by the model would have 
reflected this smaller range and lower mid-point.  Alternatively, the IRA Te am could have applied a 
triangular or Pert distribution with a most likely value at or below the mid-point, which would have resulted in fewer values at the upper end of the distribution carried through in the analysis.
1829 
7.489  Australia responds that New Zealand fails to unde rstand that it is the values in the interval 
between 0 and 10-6, and not any one value in that interval that were considered by the IRA and are 
applied on the basis of the uniform distribution.  "T his means that the probability of a particular event 
occurring is equally likely to be any probability va lue within the interval bounded by the minimum 
and maximum values of the distribution.  In other words, the probability of an event happening is equally likely to be zero as one in a million or any value in between."
1830 
7.490  Australia adds that: 
"Where the IRA Team believed it had suffici ent information to identify a most likely 
value in an interval, it used a triangular distribution, represented by a minimum value, 
a maximum value and a most likely value.  Where the IRA Team considered it had insufficient information to identify the most  likely value in an interval, it adopted a 
uniform distribution, using a mini mum value and a maximum value."
1831 
7.491  Australia further argues that New Zealand has not acknowledged that uniform distributions 
may be appropriately used, as stated by Dr Schrader.1832 
The Panel's analysis  
7.492  The IRA Team used uniform, triangular  and Pert probability distributions.1833  By definition, a 
uniform distribution has a minimum and a maximum valu e.  No most likely value is identified.  In 
principle, any value contained in the continuous  range between the minimum and maximum values 
occurs with equal probability.  The IRA states that  a uniform distribution was used where insufficient 
information was available to determine the most lik ely value.  As compared to other models of 
                                                      
1827 New Zealand's first written submission, para. 4. 191.  See also, New Z ealand's second written 
submission, paras. 2.353 and 2.356. 
1828 New Zealand's first writte n submission, para. 4.193. 
1829 Ibid.  See also, New Zealand's reply to Panel question 107 after the first substantive meeting, 
para. 236;  New Zeal and's second written submission, para. 2.357. 
1830 Australia's first written submission, para. 300. 
1831 Australia's first written submission, para. 304. 
1832 Australia's second written submission, para. 271, re ferring to Dr Schrader's  reply to Panel question 
135, in List of Replies from the scientific experts to questions posed by the Panel, para. 781. 
1833 Australia's first written submission, paras. 93-94 and 99.  See also para. 2.66 above.  WT/DS367/R 
 Page 311 
 
 
 distribution, a uniform distribution is the simplest, bu t in the circumstances of this case, as noted by 
Dr Schrader and Dr Sgrillo, it tends to generate less realistic samples.1834 
7.493  In contrast, a triangular distribution has a minimu m, maximum and a most likely value.  It is 
not necessarily symmetrical, but can be skewed in fa vour of the most likely value.  According to the 
IRA, this distribution was used when information (such as literature and e xpert opinion) on the most 
likely value was available.1835  Finally, the Pert distribution also has three parameters:  a minimum 
value, a maximum value, and a most likely value,  but it has a different, more rounded shape than a 
triangular distribution.  The Pert distribution generates a smooth distribution curve that resembles more closely a realistic probability distribution and places progressively more emphasis on values 
close to the most likely value.  Dr Schrader and Dr Sgrillo suggested that, from the three options, the 
Pert distribution is expected to be the more realis tic.  The Pert distribution was used in the IRA to 
estimate the volume of apples likely to be imported.
1836 
7.494  As noted above, New Zealand argues that the use of a uniform distribution to model the 
likelihood of certain events, particularly those w ith a "negligible" likelihood of occurring would result 
in an overestimation of the probability of entry, establishment and spread of the pests at issue. 
7.495  In principle, under a uniform distribution, an y value contained in the range between the 
minimum and maximum values occurs with equal probab ility.  This means that the model will tend to 
over represent the numbers in the higher end of the c hosen range, instead of clustering closer to zero, 
which the experts have explained w ould be more appropriate in the case of events with a "negligible" 
likelihood in the biological world.  The use of a uniform distribution with a maximum of one in a 
million results in the likelihood of so-called "neglig ible" events estimated to occur more frequently 
than, according to the IRA's qualitativ e descriptors, they should be exp ected to occur (i.e., the events 
would "almost certainly not occur").  As noted by Dr Sgrillo, there is merit in New Zealand's 
argument that a triangular distribution would have  been preferable to avoid overestimating the 
likelihood of "negligible" events.  In the words of the expert, the IRA "could have considered a 
triangular distribution with the most probable value zero and the maximum value one times ten in the 
power of minus six.  This will correct the kind of distortion (of bias) in generating random samples in 
this range."1837 
7.496  In other words, the use of a uniform distribution to model the likelihood of "negligible" 
events, in combination with the assignment of a high maximum level for the respective probability 
interval that is not adequately justified, would te nd to overestimate the likelihood of such "negligible" 
events. 
(iii) Overestimation of the projected volume of trade in New Zealand apples 
Summary of the Parties' arguments  
7.497  As noted above, New Zealand has identified the alleged exaggeration of the projected volume 
of trade in New Zealand apples as the third methodolog ical flaw that, in combination with other flaws, 
                                                      
1834 Australia's IRA, Part B, p. 42.  See para. 2.66 above ;  Dr Schrader's and Dr Sgrillo's replies to Panel 
question 135, paras.  776 and 781. 
1835 Australia's IRA, Part B, p. 42.  See para. 2.66 above ;  Dr Schrader's and Dr Sgrillo's replies to Panel 
question 135, paras. 772, 777 and 782. 
1836 Australia's IRA, Part B, p. 42.  See para. 2.66 above ;  Dr Schrader's and Dr Sgrillo's replies to Panel 
question 135, in List of Replies from the scientific experts to questions posed by the Panel, paras. 774, 778 
and 783. 
1837 Dr Sgrillo's reply in Transcript of the Panel's meet ing with experts, para. 136.  See also, Dr Sgrillo's 
reply in Transcript of the Panel's meeting with experts, para. 199. WT/DS367/R 
Page 312  
 
 would result in an overestimation of the probability of  entry, establishment and spread of the pests at 
issue.
1838 
7.498  New Zealand notes that, under the semi-quantitativ e method used in the IRA, the assigned per 
apple probability of a pest being imported is then  multiplied by Australia's estimate of the annual 
volume of trade in New Zealand apples, to give an estimated number of infested or infected apples 
imported.  From this value, an overall assessed level of risk is calculated.  Accordingly, "the higher 
the estimated volume of trade, the higher the overall assessed risk".1839 
7.499  New Zealand adds in this regard that the IRA misconceives actual demand for apples from 
New Zealand.  In New Zealand's view, the IRA has not taken into account that currently all Australian 
domestic demand for apples is supplied from local sour ces and that local supermarkets tend to provide 
support for Australian-grown produce, as well as th at most of the apple varieties favoured by 
Australian consumers are produced only in limited quantities in New Zealand.1840  New Zealand also 
notes that any attempt by New Zealand to capture a la rge market share in Australia would lead to a 
large fall in prices that would quickly make exports uneconomic.1841  Finally, New Zealand argues 
that supply-side constraints in New Zealand would al so limit the number of fresh apples that could be 
exported to Australia, because its exporters are committed in long-term contracts to Northern 
Hemisphere customers.1842 
7.500  New Zealand concludes that the IRA's estima tion of a "most likely" value of 150 million 
apples per year to be imported from New Zealand,  or 15 per cent of the market, "is out of all 
proportion with the trade that would be likely to occur in fact".1843  In New Zealand's view, "such a 
value bears no relationship to the reality of lik ely Australian demand for New Zealand apples or 
New Zealand's capacity to supply that demand".1844  New Zealand considers instead that the lower 
value in Australia's range, 50 million apples per y ear, should in fact be the "most likely" value.1845 
7.501  Australia responds that New Zealand's assertions on volume of trade lack economic and 
commercial substance and should be disregarded by the Panel.1846  Australia argues that New Zealand 
has misunderstood the process followed by the IRA.   Australia notes that the IRA acknowledges the 
difficulty of estimating the volume of trade in the abse nce of existing trade.  It suggests, however, that 
the most likely value was calculated on the basis of a range of economic and commercial factors.  
Australia adds that the volume of trade is expressed  as a Pert distribution.  Because "the most likely 
value of 150 million apples is closer to the mini mum value of 50 million apples than the maximum 
value of 400 million apples, the shape of the curve gives greater weight to values toward the lower 
end of the scale".1847 
                                                      
1838 New Zealand's first wr itten submission, para. 4.172.  S ee also, New Zealand's first written 
submission, paras. 4.194-4.203;  New Zealand's second written submission, paras. 2.359-2.367. 
1839 New Zealand's first writte n submission, para. 4.195. 
1840 New Zealand's first written submission, paras. 4.197-4.199.  Apple & Pear Australia Limited, 
"Public Submission to ACCC Grocery Inquiry by Apple & Pear Australia Limited on 11 March 2008", p. 8, in Exhibit NZ-51.  See also, New Zealand's se cond written submission, paras. 2.361-2.363. 
1841 New Zealand's first written submission, paras. 4.200-4.201.  See also, New Zealand's second 
written submission, para. 2.364. 
1842 New Zealand's first written submission, paras. 4.200-4.202.  See also, New Zealand's second 
written submission, paras. 2.365-2.366. 
1843 New Zealand's first writte n submission, para. 4.196. 
1844 Ibid. 
1845 New Zealand's second written submission, paras. 2.360.  See also, New Zealand's first written 
submission, para. 4.203. 
1846 Australia's first written submission, paras. 319 and 341. 
1847 Australia's first written submission, paras. 320-324.  WT/DS367/R 
 Page 313 
 
 
 7.502  Australia also rejects New Zealand's argument that Australian consumers would not buy the 
main types of apples produced in New Zealand.1848  Australia argues in this regard that "there is no 
reason to believe that the current composition of Au stralian production provides a template for what 
New Zealand fruit Australian consumers would choose to import."1849  With respect to its 
supermarkets, Australia argues that a preference for Australian products is only one of several key 
considerations in deciding on the source of any product;  New Zealand apples would compete on 
quality, quantity and price, just as in any other market.1850  Regarding the alleged effect of imports of 
apples on domestic prices, Australia notes that th e ABARE report cited by New Zealand concludes 
that, because Australian producers always have  the option of exporting, imports would not 
significantly drive down the Australian price.1851  Australia also submits that New Zealand's 
supposition that its exporters are tied up in long term contracts to Northern Hemisphere customers to 
such a point that they would not export significant quantities of apples to Australia "does not appear 
to accord with available evidence and e xpected future market developments".1852 
The Panel's analysis  
7.503  As noted by both Parties, the IRA's assessment is based on a projected volume of trade in 
New Zealand apples for one year, taking into account that apples might be imported in packed cartons 
for table consumption, but also in bulk bins for re packing or for processing into fruit juices or other 
products.  Australia assumed that the volume of a pple imports from New Zealand would be between 
50 million and 400 million apples per year, with a most likely value of 150 million.  These values represent approximately 5 per cent, 40 per cent and 15 per cent of domestic fresh fruit, or 2.5 per cent, 20 per cent and 7.5 per cent of Australia's to tal average apple production, respectively.
1853 
7.504  The projected volume of trade of New Zealand apples into Australia is a crucial element in 
the IRA.  As noted by Dr Latorre: 
"[T]he risk of entrance would be related to the size of the population.  In this case, it 
will depend on the total volume of mature a pples annually imported by Australia.  In 
general, as the volume increases, so does the probability that a given biological event 
may occur, increasing the chan ces that [the relevant pest] will gain entrance into 
Australia.  Therefore, it is very important for an accurate IRA to define objectively the eventual volume of mature apple that Australia would be importing from 
New Zealand annually."
1854 
7.505  The IRA acknowledges that, "[b]ecause there is no existing trade in apple fruit from 
New Zealand, the volume of apples that might be imported during 12 months was difficult to 
estimate."1855  For such a counterfactual exercise to have some validity, the IRA would need to 
formulate a hypothesis on the basis of the best available informati on and then validate the hypothesis 
with factual data, as trade begins  to develop or better information becomes available.  Indeed, the 
                                                      
1848 Australia's first written submission, paras. 326-330. 
1849 Australia's first written submission, para. 327.  See also, Australia's second written submission, 
paras. 276-283. 
1850 Australia's first written submission, paras. 331- 333.  Communication from Coles Myer Ltd to the 
Agriculture and Food Policy Reference Group, Department  of Agriculture, Fisheries and Forestry of Australia 
(25 August 2005), p. 3, in Exhibit AUS-22.  See also , Australia's second written submission, paras. 284-289. 
1851 Australia's first written submission, paras. 334-336.  See also, Australia's second written 
submission, paras. 290-310. 
1852 Australia's first written submission, paras. 337-340. 
1853 Australia's IRA, Part B, pp. 17-19.  See also Australia's first written submission, paras. 98-99. 
1854 Dr Latorre's reply to Panel question 137, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 796. 
1855 Australia's IRA, Part B, p. 18. WT/DS367/R 
Page 314  
 
 values proposed by the IRA as higher and lower scen arios, as well as most likely value, should be 
seen as hypotheses that need to be tested with actual trade data, as soon as imports of New Zealand 
apples start entering into Australia. 
7.506  The Panel is not convinced by New Zealand' s objections to the IRA's estimation of the 
projected volume of trade of New Zealand apples into Australia.  New Zealand contends that 
Australian supermarkets support local produce, that Australian consumers favour apple varieties that 
are produced in limited quantities in New Zealand, th at New Zealand varieties would be unlikely to 
attract significant market share, and that New Zeal and apple exporters would be unlikely to divert 
sales from current customers to Australia.  All of these contentions rest on the assumption that current 
tendencies that may have developed in the absence of bilateral trade in apples will persist if trade is 
allowed.  It is just as reasonable to expect the opposite:  that once the Australian market is open for 
imported apples from a geographically close partner with otherwise intense patterns of trade, the 
behaviour of consumers and superm arkets in Australia and exporters  in New Zealand would change 
so as to benefit from the new opportunities.  Irresp ective of the apple varieties that are grown in 
Australia or even the current local consumer prefer ences, if Australian consumers are attracted by the 
quality, the price or the taste of New Zealand vari eties, they may change their current consumption 
patterns.  Similarly, and irrespective of any statemen ts made in support of local production, there is no 
reason to assume that supermarkets in Australia would not rationally decide to purchase apples on the 
basis of factors such as price, quality and consumer  demand.  Nor is there any reason to suppose that 
New Zealand exporters will not rationally shift sales over time to the market that offers them better 
returns to their investment. 
7.507  Assuming that the IRA's projected volume of trade is a hypothesis that will have to be tested 
with actual trade data when imports of New Zeala nd apples start entering into Australia, the Panel is 
not convinced by New Zealand's objections regardi ng an alleged overestimation of such projected 
volume of trade.
1856 
(iv) Conclusion regarding the methodologica l flaws identified by New Zealand 
7.508  For the reasons explained above, the Panel concl udes that 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 "negligib le" likelihood of occurri ng (corresponding to the 
qualitative descriptor "the event would almost certainly not occur") is not properly justified in the IRA 
and leads to an overestimation of the probability of  entry, establishment and spread of the pests at 
issue.  Likewise, the Panel concludes that the combin ation of this probability interval for events with a 
"negligible" likelihood of occurring, with the IR A's use of a uniform distribution to model the 
likelihood of these events, would tend to result in an additional overestimation of the likelihood of 
such "negligible" events.  The Panel agrees with  New Zealand that these two flaws "magnify the 
assessment of risk, turning what are often the remote st of possibilities into even ts that are assessed as 
occurring with some frequency."1857 
7.509  The Panel concludes additionally that New Ze aland has not successfully made a prima facie 
case that the IRA's projected volume of trade is necessarily exaggerated and that such exaggeration 
would result in an overestimated probability of entry,  establishment and spread of the pests at issue. 
7.510  The Panel finds that, because of the methodological  flaws that magnify the assessment of risk, 
described above, Australia's IRA is not a proper risk  assessment within the meaning of Article 5.1 and 
paragraph 4 of Annex A of the SPS Agreement.  Th ese flaws also constitute a failure by the IRA to 
                                                      
1856 New Zealand's first wr itten submission, para. 4.172.  S ee also, New Zealand's first written 
submission, paras. 4.194-4.203;  New Zealand's second written submission, paras. 2.359-2.367. 
1857 New Zealand's second writte n submission, para. 2.297.  WT/DS367/R 
 Page 315 
 
 
 adequately take into account the available scientif ic evidence, as required by Article 5.2 of the 
SPS Agreement.  Accordingly, becau se of these flaws, Australia's requirements regarding fire blight 
on New Zealand apples are inconsistent with Articl es 5.1 and 5.2 of the SPS Agreement.  Since the 
requirements are not based on a risk assessment as  provided in Article 5.1 of the SPS Agreement, 
these measures can also be presumed, more generally,  not to be based on scientific principles within 
the meaning of Article 2.2.1858  Accordingly, the Panel finds that  Australia's requirements regarding 
fire blight on New Zealand apples are, by implica tion, also inconsistent with Article 2.2 of the 
SPS Agreement". 
5. Requirements regarding European canker 
7.511  The IRA contains a section describing the bi ology of the disease European canker caused by 
the fungus Neonectria galligena , a description of the risk scenario, a discussion of the likelihood of 
entry, establishment and spread of European canke r, an assessment of the co nsequences, a description 
of the unrestricted risk and, finally, a discussion of risk management measures.1859 
7.512  In its panel request, New Zealand challeng es the following requirements imposed by 
Australia with respect to European canker: 
• "The requirement that apples be sour ced from export orchards/blocks free of 
European canker (pest free places of production). 
• The requirement that all trees in expo rt orchards/blocks be inspected for 
symptoms of European canker, includi ng that orchards/blocks in areas less 
conducive for disease are 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. 
• The requirement that all new planting stock be intensively examined and 
treated for European canker. 
• The requirement that an orchard/block 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. 
• The requirement that exports from an orchard/block be suspended for the 
coming season on the basis of detec tion of European canker and that 
reinstatement would require eradi cation of the disease, confirmed by 
inspection."
1860 
                                                      
1858 Appellate Body Report on Australia – Salmon , paras. 137-138. 
1859 Australia's IRA, Part B, pp. 117-155. 
1860 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A-1 to  this report, p. 2.  See also, Austra lia's IRA, Part B, pp. 150-155.  As 
noted above, New Zealand and Australia reached an agre ement with respect to one of the measures that had 
been identified by New Zealand in its panel request (namely, the requirement that an orchard/block 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 sy mptoms of European canker).  See, para. 2.96 above. WT/DS367/R 
Page 316  
 
 7.513  New Zealand argues that the IRA's measures regarding European canker are maintained 
without sufficient scientific evidence, in breach of Article 2.2 of the SPS Agreement: 
"The pathway proposed by Australia for the transmission of N. galligena  has never 
been reported or observed in any of th e scientific literature, nor has it been 
demonstrated to have occurred anywhere in the world.  In particular, the Australian 
contention is not based on scientific eviden ce about the incidence of fruit infection in 
New Zealand caused by N. galligena .  It also fails to take into account the relevant 
climatic conditions in New Zealand and Aust ralia.  Further, the Australian contention 
is not based on scientific evidence relati ng to the production and spread of spores 
from mature apple fruit.  In short, there is  no scientific evidence to support Australia's 
contention and accordingly there can be no rational or objective relationship between 
the scientific evidence and the measures imposed by Australia  in respect of European 
canker for New Zealand apples.  The meas ures are therefore maintained without 
sufficient scientific evidence, in breach of Article 2.2 of the SPS Agreement."
1861 
7.514  In New Zealand's view, "[t]he IRA has faile d to evaluate the 'likelihood' of entry, 
establishment and spread of European canker as well as the potential biological and economic 
consequences within the meaning of paragraph 4 of Annex A.  A ccordingly Australia has failed to 
comply with its obligations under Article 5.1 of the SPS Agreement."1862 
7.515  New Zealand adds that Australia is in viola tion of its obligations under Article 5.1 of the 
SPS Agreement also because "[t]he IRA fails to pr ovide an evaluation of the likelihood of entry, 
establishment or spread of the diseases and pest s of concern 'according to the SPS measures which 
might be applied' and, therefore, fails to meet th e third requirement for a risk assessment within the 
meaning of paragraph 4 of Annex A."1863 
7.516  The Panel will start by considering Australia's requirements with respect to European canker 
under Articles 5.1 and 5.2 of the SPS Agreement, fo cusing on the specific alleged flaws in the IRA 
identified by New Zealand in its various submissi ons.  The Panel will consider whether New Zealand 
has properly made the case that: 
(a) The IRA contains methodological flaws that result in a vast overestimation of the 
probability of entry, establishment and spr ead of European canker into Australia 
through apples from New Zealand; 
(b) The IRA has overestimated the probability of entry, establishment and spread of 
European canker into Australia through apples from New Zealand, including through 
the estimation of various "importation steps", and the IRA's reasoning in this regard is 
not properly based on scientific evidence; 
(c) The IRA has overestimated the potential biological and economic consequences 
associated with the entry, establishment and spread of European canker in Australia, 
and the IRA's reasoning in this regard is  not properly based on scientific evidence; 
(d) The IRA has overestimated the unrestricted risk of European canker from apples from 
New Zealand, and the IRA's reasoning in this regard is not properly based on 
scientific evidence;  and, 
                                                      
1861 New Zealand's first written s ubmission, paras. 4.53-4.54. 
1862 New Zealand's first written submission, para. 4. 333.  See also, New Z ealand's second written 
submission, para. 2.459. 
1863 New Zealand's first writte n submission, para. 4.402.  WT/DS367/R 
 Page 317 
 
 
 (e) Australia's requirements imposed by Australia with respect to European canker are 
consequently not properly based on scientific  evidence and, therefore, inconsistent 
with the SPS Agreement. 
Subsequently, and if necessary, the Panel will turn to New Zealand's allegation that the IRA fails to 
provide an evaluation of the likelihood of entry, establishment or spread of European canker 
"according to the SPS measures which might be applied". 
7.517  The Panel will conduct this review beginning wi th the arguments raised by New Zealand 
specifically in the context of the IRA's analysis on European canker.  The Panel will follow the same 
order as the IRA, which is generally the order in wh ich Parties raised their arguments.  Accordingly, 
the Panel will consider the issues as follows:  the eight importation steps described in the IRA;  the 
IRA's analysis on proximity;  the IRA's analysis on exposure;  the IRA's analysis on establishment;  
the IRA's analysis on spread;  the IRA's analysis  on the potential associated biological and economic 
consequences;  and, the IRA's analysis on the unrest ricted risk of European canker.  The Panel will 
then, if necessary, turn to New Zealand's argument s regarding the alleged methodological flaws in the 
IRA. 
(a) Estimation for importation step 1 
7.518  Importation step 1 represents the likelihood that the relevant pest is present in the source 
orchards.1864 
(i) Summary of the Parties' arguments 
7.519  Regarding importation step 1 for European canke r, New Zealand "does not take issue" with 
the IRA's estimation that Neonectria galligena  would be present in source orchards in New Zealand.  
New Zealand points out, however, "the importance of climatic factors to the distribution of European 
canker in New Zealand".1865 
(ii) The Panel's analysis 
7.520  The IRA estimates the likelihood that Neonectria galligena  is present in the source orchards 
in New Zealand as a triangular di stribution with a minimum value 
of 10-2 (1 in 100), a maximum value of 5 × 10-2 (5 in 100) and a most likely value of 3 × 10-2 (3 
in 100).1866  The IRA notes that "[t]his range takes into account the variations in climatic conditions 
across New Zealand, and the information indicating that about 95% of the apple export production in 
New Zealand comes from orchards in areas where the disease has either never been recorded or the 
disease occurs only sporadically in very wet seasons."1867 
7.521  As noted above, New Zealand has not called into question the IRA's estimation of the 
likelihood of the event represented by this particular importation step. 
                                                      
1864 Australia's IRA, Part B, pp. 19-21. 
1865 New Zealand's first written submi ssion, para. 4.269.  See also, Australia's first written submission, 
para. 528. 
1866 Australia's IRA, Part B, pp. 118-121. 
1867 Australia's IRA, Part B, p. 121. WT/DS367/R 
Page 318  
 
 (b) Alleged overestimation for importation step 2 
7.522  Importation step 2 represents the likelihood that  fruit coming from an infected or infested 
orchard is infected or infested.
1868 
(i) Summary of the Parties' arguments 
7.523  Regarding importation step 2 for European ca nker, New Zealand argues that there is no 
scientific support in the IRA for the estimation of the likelihood of mature apples being infested or 
infected with Neonectria galligena .1869  New Zealand submits that the IRA contains no scientific 
evidence of the occurrence of latent European canke r infections in picked fruit in New Zealand;  
instead, the IRA relies primarily on research in the United Kingdom and Northern Europe, where 
climatic conditions are more conducive to infection.1870  The lack of appropriate weather conditions 
during summer in New Zealand would result in an "e xtremely low incidence of fruit infection caused 
by N. galligena ".1871  Pre harvest fruit rots caused by Neonectria galligena  are extremely rare in 
New Zealand.1872  New Zealand concludes that "the IRA s hould ... have treated the probability of this 
step as negligible and should not ha ve assigned the probab ility values it did."1873 
7.524  In response, Australia contends that "New Zeal and failed to identify any flaws in the [IRA's] 
conclusions on Importation step 2."1874  Australia argues that New Zealand's assertion in this regard 
"is wrong as it ignores the [IRA's] extensive discussion on Importation step 2 with numerous references to relevant scientific literature".
1875 
7.525  Australia submits that New Zealand relies on a narrow climate analysis, focused only on 
environmental criteria, that can lead to incorrect predictions.1876  Australia also argues that, contrary to 
New Zealand's assertion, the IRA "identifies four re levant studies in relation to fruit rot caused by 
N. galligena  in New Zealand".1877  Australia rejects New Zealand's contention that there is no 
scientific evidence of latent Neonectria galligena  infections occurring in New Zealand.1878  Australia 
                                                      
1868 Australia's IRA, Part B, pp. 19-21. 
1869 New Zealand's first written submission, paras.  4. 270 and 4.275.  See also, New Zealand's second 
written submission, paras.  2.466 and 2.490. 
1870 New Zealand's first written submission, paras.  4.272-4.274.  See also, New Zealand's second 
written submission, paras.  2.479-2.485. 
1871 New Zealand's first written submission, para. 4. 271.  See also, New Z ealand's second written 
submission, paras.  2.467-2.477. 
1872 New Zealand's first written submission, para. 4. 271.  See also, New Z ealand's second written 
submission, paras.  2.467-2.477. 
1873 New Zealand's first writte n submission, para. 4.275. 
1874 Australia's first written submission, para. 547.  See also, Australia's second written submission, 
para. 494. 
1875 Australia's first written submission, para. 530.  See also, Australia's second written submission, 
paras. 486-487. 
1876 Australia's first written submission, paras. 531-534 and 542. 
1877 Australia's first written submission, para. 536.  See, Atkinson, "Bacterial diseases of pip fruit" 
(1971) in Diseases of tree fruits in New Zealand , in Exhibit AUS-52;  Brook and Bailey, "Control of European 
canker" (1965), in Exhibit AUS-53;  Braithwaite , "The occurrence of fruit rots caused by Nectria galligena  
(European canker) in New Zealand and a comparison of brown rot strains between New Zealand and Australia" 
(1996), in Exhibit NZ-34;  and, communication from Biosecurity New Zealand, Ministry of Agriculture and 
Forestry (16 May 2005), in Exhibit AUS-51. 
1878 Australia's first written submission, paras. 539-541.  See also, Australia's second written 
submission, paras. 474-475 and 494.  WT/DS367/R 
 Page 319 
 
 
 finally notes that New Zealand's own research suppo rts the IRA's conclusions on the possibility of 
latent infections.1879 
(ii) The Panel's analysis 
7.526  The IRA estimates the likelihood that picked  fruit is infested or infected with Neonectria 
galligena  as a uniform distribution with a minimum value of 10-6 (1 in 1,000,000) and a maximum 
value of 10-3 (1 in 1,000).1880 
7.527  According to the IRA, "under New Zealand c onditions fruit is only occasionally attacked and 
this generally results in rotting of the fruit.  Rotted fruit would not be picked.  There is some 
likelihood of fruit getting infected late in the season and remaining latent, but this likelihood would be 
extremely low."1881 
7.528  The IRA notes that: 
"The widespread adoption of integrated fruit production (IFP) by 85–90% of 
New Zealand export orchards ... largely controls the establishment and spread of European canker ... 
The New Zealand IFP Manual recommends a combination of systemic fungicides ... 
for control of European canker ... Cooke ( 1999) reported the above fungicides reduce 
cankers by 65–90%, but suggested spray treatments alone cannot eradicate existing infections and must be supplemented by cutting out cankers and treating wounds with 
a fungicide paint. ... 
In New Zealand, European canker is primarily a disease of trees, with fruit only 
occasionally being attacked ... [L]eaf scar tissue is the main infection site in 
New Zealand orchards, particularly duri ng the establishment phase of infection.  
Similarly ... fruit spurs and leaf scars in autumn present the main infection sites for 
the disease in New Zealand apple orchards. 
Foliage is not affected ... and leaf trash is unlikely to present a significant threat, 
unless twigs with active cankers are picked with the fruit.  Fruit infection will only 
occur when the disease is pr esent on the tree or within the orchard ... and conditions 
of temperature and free moisture are suitable ... Fruit rot caused by N. galligena has 
been reported in New Zealand ... but limited data is available on the incidence of fruit 
infection in New Zealand. ... 
Various disease management measures to control summer fruit rots in New Zealand 
orchards, including cultural practices (removal of diseased wood and rotting fruit 
from trees and orchard floors) and the use of fungicides from late November/early 
December until withholding periods ... would greatly reduce the likelihood of N. 
galligena infections being present.  European ca nker is reported to be a problem only 
in high rainfall areas of Auckland and the Waikato as well as periodically in Nelson 
during wet years ... 
                                                     
 
1879 Australia's first written submission, paras. 543-546.  See also, Australia's second written 
submission, paras. 480-485. 
1880 Australia's IRA, Part B, pp. 121-123. 
1881 Australia's IRA, Part B, p. 123. WT/DS367/R 
Page 320  
 
 Fruit infection will only occur if cankers ar e present in the orchard ... Almost 90% of 
export orchards in New Zealand use di sease management programs and fungicide 
programs to control apple scab and other apple diseases, and this would minimise the possibility of European canker ... being present during fruit development and the 
harvest period.  Given that climatic cond itions typically reported for Hawke's Bay and 
Nelson during the harvest periods are normally  dry and not conducive to spore release 
and winters are not too wet ... fruit infection is very unlikely to occur.  In the higher rainfall areas of Auckland and the Waikato region, where European canker is present 
and climatic conditions are more conducive to spore production mainly due to wetter 
winters ... fruit could become infected during the harvest period.  Fruit infected late in 
the season, and showing no obvious rot symptoms, could be picked from these 
orchards.  Braithwaite (1996), in a repor t to MAFNZ, acknowledged the possibility 
that European canker could go unnoticed at harvest or during the early part of storage, and therefore could be transmitted in fruit as latent infections. ... 
In cooking varieties and immature fruit, fruit infections can remain latent and express 
themselves after 3–7 months of storage ... esp ecially if contamination occurs towards 
the end of the season ... An infection occurri ng in young, immature fruit will not grow 
... However, as acidity decreases and sugar le vels increase with ripening, the toxicity 
of benzoic acid decreases and the fungus resumes growth.  The likelihood of latent infections occurring in mature fruit is re duced, except when inf ection occurs just 
before harvesting.  New Zealand does not export significant volumes of immature or 
cooking varieties. 
Fungicidal dips before storage of fruit are not used in New Zealand ... indicating that 
storage rots may not be a significant issue in New Zealand.  However ... fruit rot is 
recorded in the New Zealand Plant Pr otection Centre (NZPPC) records and the 
fungus has been associated with storage rot of  apples, suggesting that latent infections 
also occur in New Zealand. ... 
[The likelihood of fruit being contaminated through infections on hosts other than 
Malus and Pyrus ] is negligible because there is no evidence that the disease is well 
established in other hosts in New Zealand.  Further, as stated before, infection or 
infestation of fruit is likely only when the disease is present on the trees or within the 
orchard. ... 
[In more than 450 fresh apples intercepted at the barrier by AQIS staff between 1988 
to 2003, including 53 apples from New Zealand c]ommon fruit rotting fungi were 
isolated and identified on about 30% of the fruit but there were no records of N. 
galligena being isolated."
1882 
7.529  As noted above, New Zealand's major arguments against the IRA's reasoning with respect to 
importation step 2 are:  that the IRA contains no scientific evidence of the occurrence of latent 
European canker infections in picked fruit in New Zealand and that the research in this respect from 
the United Kingdom and Northern Europe is not relevant because of the weather conditions in 
New Zealand;  that weather conditions during summer  in New Zealand would result in an "extremely 
low incidence of fruit infection caused by N. galligena ";  and that pre-harvest fruit rots caused by 
Neonectria galligena  are extremely rare in New Zealand. 
7.530  In its discussion relating to the likelihood of this particular importation step, the IRA cites 
several studies.  However, as noted by Dr Lato rre, "none of [these st udies] report information 
                                                      
1882 Australia's IRA, Part B, pp. 121-123.  WT/DS367/R 
 Page 321 
 
 
 regarding the frequency of apple infection and latency in New Zealand or elsewhere".1883  N o  
experimental data were presented in the IRA th at would support the probability values chosen.1884  
Dr Swinburne, noted that: 
"The implication of there being one infect ed fruit per thousand (max), coupled with 
the fact that 95% of exported fruit comes from orchards with little or no tree cankers 
(IRAb p121), is that fruit from infected orchar ds has in the order of 2% apples that 
will rot with N. galligena  each year.  That this would escape the attention of research 
centres in NZ seems extraord inary, if true.  Alternatively, the arbitrary probability 
maximum set in the IRA is too high."1885 
7.531  On the basis of scientific ev idence cited in the IRA, it is possible to conclude that 
Neonectria galligena  may cause fruit rots in areas or years with frequent summer rainfalls at harvest.  
As noted by Dr Latorre, the prevalence and sever ity of inoculum production and fruit infection could 
vary considerably, according to weather conditions.1886  I t  i s  n o t  o n l y  t h e  a m o u n t  o f  r a i n  t h a t  i s  
important, but mostly the hours of "leaf wetness" a nd whether rainfall occurs during critical periods.  
As mentioned by Dr Swinburne: 
"Rainfall impacts at every stage of the infection cycle of N. galligena, beginning with 
the production of spores from existing lesions.  This is particularly evident in regions 
that have distinct 'rainy seasons'. ... However, it is not the absolute volume of rain that 
correlates with the numbers of spores released (both ascospores and conidia) but the duration of 'leaf wetness', (i.e. the presence of free water on the plant surface) (Swinburne, 1971).  Thus a short storm in which several centimetres of rain falls in an 
hour would be much less conducive to spore release than when th e same volume falls 
over a period measured in days.  Likewise, even after the arrival of viable spores in the infection court (e.g. leaf scars) a con tinuing period of leaf wetness is required for 
successful infection. Dubin & English ( 1974) working in California found that no 
infections developed unless leaf-wetness was maintained for at least 6 hours.  More 
recently Latorre et al (2002) in Chile found that this  could be as little as 2 hours at the 
optimum temperature, and demonstrated the interaction between temperature and wetness.  The number of days with rain will give a much more accurate indicator of the likelihood of infection, especially wh en examined in terms of the seasonal 
frequency of rain days."
1887 
7.532  Dr Swinburne notes that the IRA focuses on total an nual rainfall.  "Total annual rainfall is an 
unsatisfactory measure of infection risk, but is relied upon heavily in the IRA and in the arguments 
presented in Annex 2 of Australia's FWS (see Q56)."1888 
                                                      
1883 Dr Latorre's reply to Panel question 75, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 437. 
1884 Ibid.  See also, Dr Sgrillo's reply to Panel question 75, in List of Replies from the scientific experts 
to questions posed by the Panel, para. 434. 
1885 Dr Swinburne's reply to Panel question 75, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 439.  See also, Dr Deckers's reply to Panel question 75, in List of Replies from the scientific experts to questions posed by the Panel, para. 436. 
1886 Dr Latorre's reply to Panel question 57, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 357. 
1887 Dr Swinburne's reply to Panel question 56, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 353. 
1888 Dr Swinburne's reply to Panel question 72, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 419.  See also, Dr Swinburne's reply to Panel questions 56 and 66, in List of 
Replies from the scientific experts to questions posed by the Panel, paras. 353, 355 and 399. WT/DS367/R 
Page 322  
 
 7.533  With respect to whether rain occurs duri ng "critical periods", Dr Latorre notes that: 
"Annual rainfall provides a general indicati on of areas with climates conducive to 
European canker.  It has been postulated th at annual rainfalls higher than 1000 mm 
are indicative of climate conditions highly conducive to the development of European 
canker.  However, European canker occurs in  areas with less annual rainfall.  Rainfall 
is important for infection during two critical periods:  (i) during leaf fall, because 
infection may occur through leaf scars, resulti ng in twig and stem cankers that appear 
during the next growing season, and (ii) dur ing harvest, because rainfall favours fruit 
infection and eventually latent infection in  mature fruits.  Knowledge of the rainfall 
distribution, during the growing season,  is important for understanding the 
epidemiology [of] European canker on apples."
1889 
7.534  Dr Latorre adds that "[f]requent summer ra infalls are necessary for inoculum production, 
dissemination and infection.  If summer rainfalls ar e frequent, it would be reasonable to assume that 
some of the infected fruits may develop symptoms  on the tree, and other fruits may be latently 
infected, developing symptoms after several weeks or even months in cold storage."1890 
7.535  There is no indication that these climatological conditions are present in New Zealand.  In 
Dr Latorre's view, "it appears that summer conditi ons in New Zealand are very unfavourable for the 
development of European canker, and that fruit infection would be an extremely rare event.  
Therefore, the likelihood of latent infection on ma ture apple fruits would be extremely low or 
negligible."1891 
7.536  With respect to latent infections, Dr Latorre notes that "latent infections would be extremely 
unlikely in apples from orchards free of European canker in the absence of summer rains.  Under 
these circumstances, the risk of latent infection is close to zero (in practice zero)."1892 
7.537  Referring to the Braithwaite (1996) study cited by the IRA, Dr Latorre suggests that "[n]o 
new objective data is reported in this  paper...  [I]t is not a reliable a nd relevant reference to support the 
hypothesis that latent infections may also  occur in mature apple in New Zealand."1893  With respect to 
this study, Dr Swinburne suggests that the propos ition that rotted fruit can transmit infection can be 
disregarded: 
"Braithwaite (1996) contains an unc onfirmed report that fruit rotting with 
[Neonectria galligena ] has been detected in NZ, and it seems to be accepted by both 
parties that this does occur occasionally, although it is by no means clear if these 
reports refer to pre- or postharvest.  Braith waite then goes on to speculate that rotted 
fruit can transmit infection, basing his argument on European observations on the 
formation of ascospores on mummified fruit.  This is a very rare occurrence, and 
                                                      
1889 Dr Latorre's reply to Panel question 56, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 352.  See also, Dr Deckers's reply to Panel question 56, in List of Replies from the scientific experts to questions posed by the Panel, para. 350. 
1890 Dr Latorre's reply to Panel question 57, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 357.  See also, Dr Latorre's reply to Panel question 66, in List of Replies from the scientific experts to questions posed by the Panel, para. 398. 
1891 Dr Latorre's reply to Panel question 57, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 358.  See also, Dr Latorre's reply to Panel question 67, in List of Replies from the scientific experts to questions posed by the Panel, para. 401. 
1892 Dr Latorre's reply to Panel guideline (g), in List of Replies from the scientific experts to questions 
posed by the Panel, para. 2. 
1893 Dr Latorre's reply to Panel question 54, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 344.  WT/DS367/R 
 Page 323 
 
 
 most unlikely to be found in the climates of NZ or Australia ... For  these reasons this 
aspect of the paper can be disregarded."1894 
7.538  Dr Latorre cautions that care should be exer cised when attempting to draw conclusions for 
New Zealand from the research conducted in Europe and cited by the IRA: 
"Australia's IRA based their risk assessm ent on the information already published 
from studies in Northern Ireland (Swinburne, 1964, 1975, Exhibits NZ-11 and NZ-9, 
respectively).  These results were obtaine d on apple varieties quite different from 
those produced today in New Zealand a nd under environmental conditions that 
appear to be far more conducive to fruit in fection (in Northern Ireland) than those in 
New Zealand.  Although this does not inva lidate the risk assessment analysis, and it 
does not reject the hypothesis that latent in fections may occur in mature fruits in 
New Zealand, it is a factor that should be ta ken into consideration by Australia's IRA.  
Latent infection on mature fruits should not be under discussion, but the probability 
of latent infection in many apple culti vars produced under different environmental 
conditions in New Zealand is of utmost interest."1895 
7.539  Dr Swinburne concurs.  In his opinion, it is im portant to consider, not only annual rainfall, but 
rainfall patterns, in order to determine whether th ere are sufficiently long periods of leaf wetness: 
"The essential weakness of the approach in the IRA is that it assumes that inoculum 
(spores) for infection is always available, and all that is required is a suitable period 
(hours of leaf wetness within given temperature limits) for infection to occur.  The major flaw in this argument is the assum ption that regions can be compared on the 
basis of annual rainfall, without regard to rainfall patterns.  Even in regions such as 
N. Ireland (Loughgall) with rain in all seas ons, more than 5hrs of leaf wetness was 
required following a few dry days before ascospore discharge resumed (Swinburne, 
1971b).  The situation in regions with a pronounced dry season, such as California 
and the Pacific Northwest in the USA, spore formation does not even begin until 
some time (as yet undetermined) into the ra iny period (Zeller, 1926, Wilson, 1966/8).  
For such an area data relating only to simple 'infection periods' would greatly 
overestimate the risk of disease establishment."
1896 
7.540  Dr Swinburne notes that, in New Zealand, rots in fruit attributable to N. galligena  should not 
be common: 
"The limited information available in both FWS documents suggests that rots 
attributable to N. galligena  in fruit grown in New Zealand are by no means as 
common as they are in Europe, and (of course) are seemingly confined to regions of NZ where tree cankers are present.  The weather data presented in Annex 2 of the NZ FWS would accord with a low incidence of fruit infection, and, based on Wilson's (1966) observations in California, even c onidial production from stem cankers may 
be sparse during summer.  It is perhaps si gnificant that in what was described as an 
epidemic of canker in Auckland that Br ooke& Bailey (1965) only found occasional 
                                                     
 
1894 Dr Swinburne's reply to Panel questions 54 and 55, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 349. 
1895 Dr Latorre's reply to Panel question 55, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 346. 
1896 Dr Swinburne's reply to Panel question 66, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 399.  See, Swinburne, "The seasonal release of spores of Nectria galligena  
from apple cankers in Northern Ireland" (1971), in Exhibit AUS-76;  Wilson, "Development of European canker 
in a California apple district" (1966), in Exhibit NZ-64. WT/DS367/R 
Page 324  
 
 fruit rots.  Unfortunately that paper does not record whether the rots were found 
before or after harvest."
1897 
7.541  Dr Latorre agrees with New Zealand that, under the climatic conditions of New Zealand, the 
IRA may have overestimated the likelihood of this importation step: 
"Considering the epidemiological characteris tics of European canker, the probability 
intervals given in Table 12 [for an even t with an 'extremely low' likelihood of 
occurrence] are too conservative for areas with dry summer conditions, although they 
may be acceptable for areas with frequent summe r rains.  Therefore, the figures may 
overestimate the likelihood of each even t to occur under dry summer conditions, 
particularly if fruit infection is extremely close to zero."1898 
7.542  The importance of adequate climatological conditi ons is highlighted by Dr Swinburne.  "Both 
parties seem to agree that the frequency of fru it rotting is low, given the paucity of positive 
identifications.  That this is so, even from regions  with tree cankers (e.g. Auckland) this must be 
attributable to unfavourable weather conditions, especially the absence of rain, during the summer 
months."1899  Dr Swinburne recalls the situation of locations, "such as Northern Ireland, which 
represents an extreme environment in which apples are produced, there are no dry periods at all.  Rain 
falls fairly evenly throughout the year and in some  locations on every day of the year."  He then 
contrasts this situation with that of other locations , "California in particular... and to a more limited 
extent ... Kent, [and] perhaps more extremely ... Ne w Zealand [where] you have very pronounced dry 
periods and very few, relative to Northern Ireland, days of leaf wetness."  In Dr Swinburne's view, 
"[i]t is that difference which makes a difference in  the pulse of the disease.  The availability of the 
inoculum in relation to those leaf-wetness periods is  crucial. ... In a location such as California, and I 
am assuming also New Zealand, that pulse is in terrupted by pronounced dry periods, particularly 
during the summer months."1900  Dr Latorre concurs and notes that: 
"Weather conditions are also very, very important during summer time for inoculum 
production and then for inoculum disseminati on, infestation ... and finally infection.  
In some places of the world where appl es are produced, like Chile, California and 
New Zealand, summers are very dry, no rain at all.  If it ever happens, there are very 
short rainy periods and not enough to fulfil perhaps inoculum production."1901 
7.543  As cited above, Dr Swinburne finally notes that  it would seem "extraordinary, if true" that a 
high proportion of apples rotted with Neonectria galligena  would go unnoticed by research centres in 
New Zealand and that "[a]lternatively, the arbitrary probability maximum set in the IRA is too 
high."1902 
                                                      
1897 Dr Swinburne's reply to Panel question 57, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 361.  See, Wilson, "Development of European canker in a California apple 
district" (1966), in Exhibit NZ-64. 
1898 Dr Latorre's reply to Panel question 75, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 437.  Dr Swinburne's reply to Panel question 75, in List of Replies from the scientific 
experts to questions posed by the Panel, para. 439.  See also, Dr Deckers's reply to Panel question 57, in List of Replies from the scientific experts to questions posed by the Panel, para. 356. 
1899 Dr Swinburne's reply to Panel question 75, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 438. 
1900 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 525. 
1901 Dr Latorre's reply in Transcript of the Panel's meeting with experts, para. 526. 
1902 Dr Swinburne's reply to Panel question 75, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 439.  See also, Dr Deckers's reply to Panel question 75, in List of Replies 
from the scientific experts to questions posed by the Panel, para. 436.  WT/DS367/R 
 Page 325 
 
 
 7.544  In conclusion, the IRA contains respected and qualified scientific evidence regarding the 
possibility of Neonectria galligena  causing fruit rots in areas or years with frequent summer rainfalls 
at harvest.  It does not, however, contain adequate scientific evidence that would allow an estimation 
of the frequency of apple infection and latency in New Zealand or elsewhere.  Moreover, the studies 
on fruit infection cited in the IRA are based on r esearch conducted in areas or periods with frequent 
summer rainfalls at harvest.  The IRA fails to  properly take into account the existence of 
climatological conditions in New Zealand that  would be necessary for inoculum production, 
dissemination and infection. 
7.545  Accordingly, the Panel finds that the IRA's es timation of the likelihood that fruit coming from 
an infected or infested orchard is infected or infested with Neonectria galligena  is not sufficiently 
supported by the scientific evidence that the IRA re lied upon and, therefore, is not coherent and 
objective. 
(c) Alleged overestimation for importation step 3 
7.546  Importation step 3 represents the likelihood that cl ean fruit from infected or infested orchards 
is contaminated during picking and transport to the packing house.1903 
(i) Summary of the Parties' arguments 
7.547  Regarding importation step 3 for European canker, New Zealand argues that the IRA's 
analysis "is based on the assumption that N. galligena  spores could be transferred to clean fruit.  This 
is an event that has never b een recorded and that would almost certainly not occur."1904  New Zealand 
submits that there would be no way for fruit contamin ation to occur, because the likelihood of mature 
fruit being latently infected with Neonectria galligena  is negligible and, in any event, "latently 
infected but symptomless fruit would not have an y rot and therefore could not generate spores".1905 
7.548  New Zealand adds that weather conditions in most areas of New Zealand during the 
harvesting season would not be favour able for spore production and disp ersion and, even if conidia 
were to be dispersed by rain onto the surface of a mature apple, they would be unlikely to survive 
without continued moisture.1906  New Zealand rejects the assumption that mummified fruit could be a 
source of contamination, "as formation of perith ecia takes place during winter and they are not 
therefore even present at harvest".1907 
7.549  New Zealand finally submits that the IRA's s uggestion "that contamination from alternative 
hosts is possible during harvest in the 'wetter districts of Auckland and the Waikato' ... is nothing more than unsubstantiated speculation, since the event has never been  observed to occur."
1908 
7.550  New Zealand concludes that "the likelihood of  contamination of clean fruit during picking 
and transport is negligible, an event that would almo st certainly not occur, and not an event with the 
most likely probability value of 1 in 100,000 apples assigned to it by the IRA."1909 
                                                      
1903 Australia's IRA, Part B, pp. 19-21. 
1904 New Zealand's first written submission, para. 4. 277.  See also, New Z ealand's second written 
submission, paras.  2.492 and 2.494-2.496. 
1905 New Zealand's first writte n submission, para. 4.277. 
1906 New Zealand's first written submission, para. 4. 278.  See also, New Z ealand's second written 
submission, paras.  2.492 and 2.506-2.513. 
1907 New Zealand's first written submission, para. 4. 279.  See also, New Z ealand's second written 
submission, paras.  2.499-2.505. 
1908 New Zealand's first writte n submission, para. 4.280. 
1909 New Zealand's first writte n submission, para. 4.281. WT/DS367/R 
Page 326  
 
 7.551  In response, Australia contends that "New Zeal and failed to identify any flaws in the [IRA's] 
conclusions on Importation step 3."
1910  Australia argues in this regard that there is scientific support 
for the IRA's expert judgement on the estimati on of the likelihood for this importation step.1911  In its 
view, New Zealand "[ignores] the fact that there can be more than one credib le interpretation of the 
[scientific] evidence."1912 
7.552  In this regard, Australia acknowledges that "lat ently infected fruit would not generate spores 
for contamination of clean fruit during picking and tr ansport to the packing house as such infections 
develop after a period in storage."1913 
7.553  Australia argues, however, that the IRA identif ied various other means for fruit contamination 
to occur during picking and transport to the pack ing house, such as:  contaminated hands or 
equipment of workers;  spores carried by rain splash or wind;  and trash.1914 
7.554  Australia rejects New Zealand's contention about  the lack of suitable weather conditions in 
New Zealand for the production and dispersion of spores.1915  Australia notes that the IRA refers to 
"evidence of occasional European canker fruit rot in New Zealand due to wet conditions during 
harvest in the summer ... This rotting fruit can produce spore pustules bearing numerous conidia."1916  
Australia also disputes New Zealand's arguments regarding the alleged impossibility of mummified 
fruit to serve as a source of contamination.1917 
(ii) The Panel's analysis 
7.555  The IRA estimates the likelihood that clean fruit is contaminated by Neonectria galligena  
during picking and transport to the packing house as a triangular distribution with a minimum value of 
10-6 (1 in 1,000,000), a maximum value of 10-4 (1 in 10,000) and a most likely value of 10-5 (1 
in 100,000).1918 
7.556  According to the IRA, "[t]his range allows for a small number of fruit to be contaminated but 
recognises that conditions in most areas of New Zealand during the harvesting season are not favourable for spore production."
1919 
7.557  The IRA notes that: 
"Clean fruit could be surface-contaminated by:  pickers' hands or gloves 
contaminated with spores... spores carried in rain splash or wind currents during harvesting and transport ... trash with ac tively sporulating fungus and spores making 
contact with fruit in bins.  Clean fru it displaying no obvious rot symptoms and 
recently infected but symptomless fruit woul d be extremely unlikely to contaminate 
other fruit during the picking or trans port process because the fungus does not 
actively sporulate until fruit becomes badly ro tted or mummified ... Infected fruit that 
drops before harvest, or that remains on trees and becomes mummified during winter 
                                                     
 
1910 Australia's first written submission, para. 563. 
1911 Ibid. 
1912 Australia's first written submission, para. 562.  See also, Australia's second written submission, 
para. 466. 
1913 Australia's first written submission, para. 549 (footnote omitted). 
1914 Ibid. 
1915 Australia's first written submission, paras. 551-557. 
1916 Australia's first written submission, para. 553. 
1917 Australia's first written submission, paras. 558-559 (footnote omitted). 
1918 Australia's IRA, Part B, pp. 124-125. 
1919 Australia's IRA, Part B, p. 125.  WT/DS367/R 
 Page 327 
 
 
 can develop perithecia in spring, producing ascospores that could contaminate other 
fruit. ... Foliage is not affected and trash  presents an extremely small likelihood of 
contamination unless twigs with active cankers  are picked along with fruit ... Infected 
twigs or branches that have been cut and le ft on the orchard floor can sustain cankers 
for long periods and produce abundant spores ... 
Spores contaminating bins are unlikely to present a significant likelihood for infection 
as conidia and ascospores are sensitive to desiccation even at high relative humidity. ... 
Because N. galligena has a large host range, contamin ation could come from canker 
infections on susceptible hosts planted n ear export orchards. ... Although fungicides 
are widely used in orchards, alternative hos ts planted as hedgerows and infected with 
N. galligena could produce conidia during the harvest period and, under the right 
climatic conditions, could contaminate cl ean fruit during picking and transport.  
Conidia can be dispersed up to 125 m in wet and windy storm conditions ... and if cankers were present on alternative hosts, fruit could become contaminated.  In 
New Zealand, there are 54 records of N. galligena occurring primarily on Malus and 
Pyrus  and isolated from stem cankers.  The f ungus has also been recorded on loquats 
(Eriobotrya japonica ), coprosma ( Coprosma areolate ) and kowhai ( Sophora 
microphylla ) however there are no details of whether these detections originated from 
cankers from these species or if any disease symptoms were present.  There is also no information in the literature indicating these species are hosts of N. galligena and 
there is no evidence the disease has become  established on these species. ... Climatic 
conditions typically experienced during harvest periods in most New Zealand orchards are not conducive to spore release a nd infection, but in the wetter districts of 
Auckland and the Waikato region, conditions favour these processes."
1920 
7.558  As noted above, New Zealand's major arguments against the IRA's reasoning with respect to 
importation step 3 are:  that the transfer of Neonectria galligena  spores to clean fruit has never been 
recorded and "would almost certainly not occur", esp ecially since latently infected but symptomless 
fruit would not have any rot and therefore could not ge nerate spores;  that w eather conditions in most 
areas of New Zealand during the harvesting season w ould not be favourable for spore production and 
dispersion and, in any event, conidia would be unlikely to survive without continued moisture;  and that mummified fruit would not be a source of cont amination, because formation of perithecia takes 
place during winter and they are not therefore even present at harvest. 
7.559  The IRA's analysis regarding importation step 3 is based on an assumption that Neonectria 
galligena  spores can be transferred to clean fruit.  Dr Latorre expressed his doubts: 
"The assumption that N. galligena  spores could be transferred to clean fruit should be 
considered as a hypothesis th at needs to be probed.  To my knowledge, there is no 
scientific literature addressing this point.   Based on general disease knowledge, it is 
an extremely unlikely event.  It is difficu lt to accept and may be impossible to support 
the probability values assigned to this step, 1 × 10
-6 and 1 × 10-4."1921 
                                                      
1920 Australia's IRA, Part B, pp. 124-125. 
1921 Dr Latorre's reply to Panel question 78, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 452.  See also, Dr Deckers's a nd Dr Sgrillo's replies to Panel question 78, in List of 
Replies from the scientific experts to questions posed by the Panel, paras. 451 and 446. WT/DS367/R 
Page 328  
 
 7.560  In particular, Dr Latorre considers "highly unlik ely" the proposition that latently infected but 
symptomless fruit could develop rot and generate spores.
1922  He notes that "[l]atently infected fruits 
[would] develop symptoms before producing conidia."1923  In Dr Latorre's view, "[t]here are not 
qualified scientific sources to support the view that  mature apple fruit can be infested (surface-
contaminated) with spores at harvest, including via wind currents.  If this event would happen it 
would be extremely rare and would not necessarily result in infected fruits, unless enough spores land 
on damaged mature fruits."1924 
7.561  Dr Latorre notes further the lack of evidence that European canker can develop from rotten 
fruit.  "In my experience, rotten fruit is very rare, almost never occurs in our conditions and 
sometimes we do see it after several months or weeks of cold storage in a very low proportion and 
never sporulated on the surface of the fruit.  If this  fruit are not sporulating it is impossible to admit 
that it can spread at least easily to the clean fruit."1925 
7.562  Dr Latorre additionally notes that "[t]he reasoni ng in Australia's IRA with respect to the view 
that latently infected but asymptomatic mature a pple fruits may develop rot and thus generate spores 
of N. galligena  during picking and transport to the packing house (although objective) is highly 
unlikely."1926  In his opinion, the IRA's analysis in this regard "overestimates the risk of inoculum 
dispersal".1927  Dr Latorre adds that the IRA's analysis overestimates the risk of inoculum dispersal: 
"Australia does not provide objective data  regarding spore (conidia, ascospore) 
production and release under the environmenta l conditions of New Zealand.  There 
are not qualified scientific sources to support the view that mature apple fruit can be infested (surface-contaminated) with spores at harvest, including via wind currents.  
If this event would happen it would be extremely rare and would not necessarily 
result in infected fruits, unless enough spores land on damaged mature fruits.  Conidia 
are not wind dispersed;  they are dispersed  by rains and rain-splash.  Ascospores can 
be dispersed by wind currents to rather short distances (metres from the inoculum source).  However, it would be possible that rain-splashes containing spores may be 
carried several metres by winds.  In my opinion this analysis overestimates the risk of 
inoculum dispersal."
1928 
7.563  Dr Swinburne concurs and notes that "[t]here  are no reports which imply that rotted apples 
are in any way involved in th e transfer of infection with N. galligena to 'clean' orchards".1929 
7.564  Notwithstanding the above, if spores were to be produced and disseminated onto susceptible 
fruits, Dr Swinburne explains that, in accordance with the general experience in many fruit growing 
                                                      
1922 Dr Latorre's reply to Panel question 77, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 444.  See also, Dr Deckers's reply to Panel question 77, in List of Replies from the scientific experts to questions posed by the Panel, para. 443. 
1923 Dr Latorre's reply to Panel question 77, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 445. 
1924 Dr Latorre's reply to Panel question 67, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 401. 
1925 Dr Latorre's reply in Transcript of the Panel's meeting with experts, para. 413. 
1926 Dr Latorre's reply to Panel question 77, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 444.  See also, Dr Deckers's reply to Panel question 77, in List of Replies from the 
scientific experts to questions posed by the Panel, para. 443. 
1927 Dr Latorre's reply to Panel question 67, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 401. 
1928 Ibid. 
1929 Dr Swinburne's reply to Panel questions 54 and 55, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 347.  WT/DS367/R 
 Page 329 
 
 
 regions in Europe, a "sufficient period of leaf-w etness" would be necessary "to allow the deposited 
spore to germinate and colonise limited areas within the calyx or lenticels".1930  Indeed, the Panel has 
already noted the opinion expressed by the experts that "[f]requent summer rainfalls are necessary for 
inoculum production, dissemination and infection."1931  There is no indication that these 
climatological conditions are present in New Zealand.  Dr Latorre expressed his view that the 
proposition that spores could survive without continue d moisture, if they were produced and dispersed 
by rain onto the surface of suscep tible fruits, "has no credibility".1932 
7.565  As noted above, New Zealand has also disputed  the IRA's assertion that "[i]nfected fruit that 
drops before harvest, or that remains on trees and becomes mummified during winter can develop 
perithecia in spring, producing ascospor es that could contaminate other fruit."1933  In this respect, 
Dr Latorre submits that, while "[i]t is possible that  perithecia play a minor role in the establishment 
and dissemination of N. galligena  from rotted fruit, if this ever happe ns", in his opinion, "there is not 
enough scientific evidences supporting the role of pe rithecia (ascospores), eventually developed on 
rotted fruits, [in] the overall epidemiology of European canker."1934 
7.566  As noted by Dr Latorre, the most important i noculum for European canker would be conidia, 
"and conidia are only formed under very wet conditions  in the orchard, mainly in the cankers and 
almost never, or never at least in my experience, on the fruit".1935  "[P]erithecia only occur under 
certain conditions and most often they are not impor tant from the epidemiologic point of view.  The 
development of the [European canker] disease is as sociated to the production of the asexual spores, 
namely conidia, but not to the production of the sexual part of the fungi, which is the so-called 
production of perithecia and ascospores".1936 
7.567  Both Dr Latorre and Dr Swinburne explain that there is no evidence of perithecia forming on 
rotten fruit.  As explained by Dr Latorre: 
"I have no information indicating that Eur opean canker can develop from rotten fruit.  
In my experience, rotten fruit is very rare, almost never occurs in our conditions and 
sometimes we do see it after several months or weeks of cold storage in a very low 
proportion and never sporulated on the surface of the fruit.  If this fruit are not 
sporulating it is impossible to admit that it can  spread at least easily to the clean fruit.  
Well, I think the observation about perithecia on the fruit is something that has to be reviewed.  We have never seen perithecia  form on the fruit.  I don't have any good 
                                                     
 
1930 Dr Swinburne's reply to Panel question 57, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 360. 
1931 Dr Latorre's reply to Panel question 57, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 357.  See para. 7.534 above. 
1932 Dr Latorre's reply to Panel question 68, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 403.  See, Puia et al., "Effect of Ozone Exposure on Phytopathogenic Microorganisms 
on Stored Apples" (2004), in Exhibit AUS-56.  See also, Dr Swinburne's reply to Panel questions 67 and 68, in 
List of Replies from the scientific experts to questions posed by the Panel, para. 404;  Dr Deckers's replies to 
Panel questions 68 and 78, in List of Replies from th e scientific experts to questions posed by the Panel, 
paras. 402 and 451;  and New Zealand's second written submission, paras. 2.514-2.516. 
1933 Australia's IRA, Part B, p. 124. 
1934 Dr Latorre's reply to Panel question 70, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 410. 
1935 Dr Latorre's reply in Transcript of the Panel's meeting with experts, para. 413. 
1936 Dr Latorre's reply in Transcript of the Panel's meeting with experts, para. 459.  See also, reply of 
Dr Swinburne in Transcript of the Panel's meeting with experts, para. 461. WT/DS367/R 
Page 330  
 
 paper that can really demonstrate that in the recent years they have seen perithecia in 
very susceptible varieties, but not in today's apple varieties."
1937 
7.568  Dr Swinburne concurs and notes that: 
"[T]here is in fact no evidence in the literatu re that infected apples which rot with this 
fungus are responsible subsequently for the dissemination of the disease to other 
hosts, to further hosts.  Much of the ev idence that has been presented concerns 
observations made in the 1920s by Dillon-Western concerning a variety known as Worcester, which is an extremely early variety, which does rot on the tree and produces mummified fruits.  In the 40-odd years that I have worked on this, I never have had the privilege of seeing such a thing and I have attempted in the past to 
produce perithecia and ascospores from rotted apples for experimental purposes and 
failed.  Fruit which rot with Nectria  as I will call it, does produce conidia if it is 
incubated under moist humid cond itions to a limited extent in the centre of the lesion.  
It is not a prolific source of spores for s ubsequent release and I fear that nobody has 
actually done the experiment of  determining whether a rotte d apple can release spores 
into a new orchard situation and bring about disease.  It is amenable to 
experimentation, along the lines of an experi ment which we made in East Malling not 
too long ago with discarded canker wood which we pulverized and placed under 
potted trees of the most susceptible variety that I know, namely Spartan, and we failed to induce a single canker as a result of pulverizing several, maybe 50 kilos, of cankers underneath them."
1938 
7.569  Dr Latorre concludes that there is no scientific  evidence to support th e hypothesis of fruit 
contamination with spores of Neonectria galligena  during picking and transport to the packing house: 
"The likelihood that … spores may contaminat e fruits superficially is extremely rare, 
and the probability that spores contaminati ng the surfaces of mature fruits will cause 
infection is negligible.  In conclusion, fruit contamination with spores of N. galligena  
during picking and transport to the packing house should be disregarded.  There is no 
scientific evidence on this subject to strongly support this hypothesis."1939 
7.570  Regarding the IRA's assertion that "[i]n the hi gher rainfall areas of Auckland and the Waikato 
region, where European canker is present and c limatic conditions are more conducive to spore 
production mainly due to wetter winters ... fruit coul d become infected during the harvest period", 
Dr Swinburne notes that: 
"The majority of fruit infections in the European context are to be found either at the 
stem end or the calyx end, and generally speaking it means that the core has been 
infected.  The time at which that infecti on occurs [would be] surprisingly early on in 
the fruits development.  It isn't at the time of harvest, it isn't in the dump tank.  That core rot is taking place at some stage when either the calyx or the stem end is 
enabling an entry point for conidia whic h are washing down over the surface of the 
tree and either accumulating it in the stem well or going around and entering the calyx.  I don't have any information which would ever suggest that infestation of 
                                                     
 
1937 Dr Latorre's reply in Transcript of the Panel's meeting with experts, para. 413.  See also, reply of 
Dr Swinburne in Transcript of the Panel's meeting with experts, para. 461. 
1938 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 411. 
1939 Dr Latorre's reply to Panel question 77, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 445.  See also, Dr Latorre's reply in Transcript of the Panel's meeting with experts, 
para. 486.  WT/DS367/R 
 Page 331 
 
 
 apples at harvest, and I stress that point, or even after harvest leads to any significant 
level of rotting in commercial conditions."1940 
7.571  Dr Swinburne adds that "it is most unlikely th at conidia which simply contaminate the surface 
of fruit would play any part in an infection pathway".1941  A s  n o t e d  b y  b o t h  D r  L a t o r r e  a n d  
Dr Swinburne, conidia are poor epiphytes;  they will not survive as a surface contaminant.1942 
7.572  In conclusion, the IRA does not contain scien tific evidence regarding the possibility that 
latently infected but symptomless fruit could develop rot and generate Neonectria galligena  spores, 
which could then be transferred to clean fruit.  Ther e is also no indication in the IRA of the existence 
of climatological conditions in New Zealand that are necessary for inoculum production, dissemination and infection of clean fruit during pick ing and transport to the packing house.  The 
IRA's discussion fails to take into account that co nidia are poor epiphytes.  There is no scientific 
evidence in the IRA to support the proposition that pe rithecia would play a role in the contamination 
of clean fruit. 
7.573  Accordingly, the Panel finds that the IRA's est imation of the likelihood that clean fruit is 
contaminated by Neonectria galligena  during picking and transport to the packing house is not 
sufficiently supported by the scientific evidence th at the IRA relied upon and, accordingly, is not 
coherent and objective. 
(d) Alleged overestimation for importation step 4 
7.574  Importation step 4 represents the likelihood that in fected or infested fru it remains infected or 
infested after routine processing procedures in the packing house.
1943 
(i) Summary of the arguments of the Parties 
7.575  Regarding importation step 4 for European canke r, New Zealand argues that, "[g]iven that 
routine packing house processes would almost certainly  reduce any external contamination, and in the 
absence of any relevant scientific evidence relati ng to latent survival for mature, symptomless 
New Zealand apple fruit, there is simply no scientific  basis for the IRA's claim that there is an 85% 
likelihood that N. galligena  would survive processing."1944 
7.576  According to New Zealand, there is no relevant  scientific evidence on which to determine the 
IRA's estimation for this likelihood.  In New Zeal and's view, "[t]he scien tific data relied on by 
Australia in the IRA to support its theories are simply not applicable."1945  New Zealand adds that the 
IRA does not provide any scientific evidence of latent survival or storage rots in relation to mature, 
symptomless New Zealand apples.1946 
7.577  New Zealand argues that the IRA's analysis of  importation step 4 "is based on an assumption 
that fruit entering the packing house will be infect ed or infested – an event which itself has a 
                                                      
1940 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 441. 
1941 Dr Swinburne's reply to Panel questions 67 and 68, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 405. 
1942 Dr Latorre's and Dr Swinburne's replies in Tr anscript of the Panel's meeting with experts, 
paras. 434-435. 
1943 Australia's IRA, Part B, pp. 19-21. 
1944 New Zealand's first written submission, para. 4. 287.  See also, New Z ealand's second written 
submission, paras.  2.536-2.539. 
1945 New Zealand's first written submission, para. 4. 283.  See also, New Z ealand's second written 
submission, para. 2.524. 
1946 New Zealand's first writte n submission, para. 4.284. WT/DS367/R 
Page 332  
 
 negligible likelihood of occurring".
1947  Moreover, because the majority of consignments of 
New Zealand apples would be "retail-ready", "if late ntly infected fruit were to develop visible rot 
symptoms in storage, this would be detected and removed at the time of packaging while the fruit was 
still in New Zealand and accordi ngly would not enter Australia."1948 
7.578  Concerning infestation, New Zealand submits th at the IRA fails to take into account that 
New Zealand export packing houses use water dump tanks  at the start of their packing line, generally 
followed by high-volume, high-pressure water washing,  in order to remove debris and sessile and 
motile insects.  These processes would be "h ighly effective in removing other external 
contaminants".1949 
7.579  In response, Australia contends that "New Zeal and failed to identify any flaws in the [IRA's] 
conclusions on Importation step 4."1950  Australia argues in this rega rd that New Zealand makes an 
"unsustainable" attempt to "summarily dismiss the IRA Team's exercise of e xpert scientific judgment" 
in relation to this importation step.1951  Contrary to New Zealand's a llegation, "there is scientific 
support for the IRA Team's expert judgment" regard ing the estimation of the likelihood of importation 
step 4.1952 
7.580  Australia rejects the proposition that latent inf ection and storage rot do not occur in mature, 
dessert varieties of apples.1953  Regarding New Zealand's arguments, Australia submits that the 
product at issue in the dispute is mature apples from New Zealand free of trash and not "mature, 
symptomless" apples from New Zealand.  Australia a dds that the IRA contains numerous references 
to scientific literature on "latent survival or storage rots".1954  Australia also reiterates the view, 
expressed in the context of importation step 2, that scientific research about latent infection in the 
United Kingdom and Northern Eur ope is relevant to the importation of apples from New Zealand.1955 
7.581  Notwithstanding New Zealand's arguments, Aust ralia considers it unlikely that New Zealand 
would ship apples to Australia as "retail-ready" and "just-in-time".1956  In its view, New Zealand has 
been "ambivalent" regarding the mode of trade it would use in its exports of apples.  Australia 
considers it unlikely that New Zealand exporters would ship apples in "retail ready" form with 
returnable plastic crates;  instead it suggests that they are likely to opt for shipping fruit in bulk 
bins.1957  Australia adds that, in any event, impor ting apples from New Zealand "retail-ready" and 
"just-in-time" would actually reduce the likeli hood of detecting latent infections caused by Neonectria 
galligena  and increase the likelihood of th e pathogen reaching Australia.1958  Australia finally submits 
                                                      
1947 New Zealand's first writte n submission, para. 4.282. 
1948 New Zealand's first written subm ission, para. 4.285.  See also , New Zealand's reply to Panel 
question 8 after the first substantive meeting, paras.  13-15;  New Zealand's second written submission, 
paras. 2.525-2.535. 
1949 New Zealand's first written submission, para. 4. 286.  See also, New Z ealand's second written 
submission, paras.  2.536-2.539. 
1950 Australia's first written submission, para. 580. 
1951 Australia's first written submission, para. 568. 
1952 Australia's first written submission, para. 580.  See also, Australia's first written submission, 
para. 568. 
1953 Australia's first written submission, para. 572. 
1954 Australia's first written submission, para. 574. 
1955 Australia's first written submission, para. 571.  See also, Australia's first written submission, 
paras. 540-541. 
1956 Australia's first written submission, para. 576. 
1957 Australia's first written submission, para. 576.  See also, Australia's reply to Panel question 9 after 
the first substantive meeting. 
1958 Australia's first written submission, para. 577.  WT/DS367/R 
 Page 333 
 
 
 that washing would not remove surface fungal spor es and that it would have no effect on internal 
infections.1959 
(ii) Analysis of the Panel 
7.582  The IRA estimates the likelihood that Neonectria galligena  survives routine processing 
procedures in the packing house as a triangular distri bution with a minimum value of 0.7 (70 in 100), 
a maximum value of 1 (100 in 100) and a most likely value of 0.85 (85 in 100).1960 
7.583  According to the IRA, "[t]his range largely reflect s the fact that internal and latent infections 
are unlikely to be visible and none of the processe s in the packing house are likely to substantially 
reduce infections."1961 
7.584  The IRA notes that: 
"Most apple exporters in New Zealand routin ely use a pre-cooling step in the packing 
house process ... Rapid cooling after harvest re duces the incidence of decay in storage 
... However, the short period of pre-cooling would not significantly affect the survival 
of latent infections, and the number of infected fruit would not be significantly reduced. 
Initial washing of fruit in a dump tank an d subsequent high-volume, high-pressure 
water washing (if available) may remove surface spores but will have no effect on internal infections, and the fungus will survive these procedures.  Several export 
packing houses in New Zealand use chlorine or other disinfectants ... in the dump tanks to reduce microbial populations ... Although there is no specific data to indicate their effectiveness against N. galligena, it is likely these chemical s used at the correct 
dosage rates (concentration and time) woul d have varying degrees of effectiveness. 
However, internal infections will not be a ffected by such treatments ... and the fungus 
will survive these procedures. 
Brushing would not remove fungi present in internal tissues or at the stem and calyx-
ends of fruit, as these areas are inaccessible. 
Conidia will survive low temperature waxing and waxing could help hold conidia or 
hyphae onto the fruit. 
Sorting and grading will remove fruit with visible rots and blemishes, but latent 
infections or surface contamination will not be detected by visual examination. 
Post-harvest fungicide treatments are not used  in New Zealand before cold storage ... 
Neonectria galligena can survive at temperatures between 2°C and 30°C ... and 
would readily tolerate cool storage temper atures. ... Any temporary cold storage soon 
after harvest and before processing begins is lik ely to be very short, a few days at the 
most, and this period of storage will be to o short for significant expression of latent 
infections. ... Fruit becomes more susceptib le to rotting from latent infections as 
                                                     
 
1959 Australia's first written submission, para. 579. 
1960 Australia's IRA, Part B, pp. 125-126. 
1961 Australia's IRA, Part B, p. 126. WT/DS367/R 
Page 334  
 
 storage times increase ... Any infection or infestation that remains at the end of 
packing house procedures will survive cold storage."
1962 
7.585  As noted above, New Zealand's major arguments against the IRA's reasoning with respect to 
importation step 4 are:  that the IRA does not provide  scientific evidence of latent survival or storage 
rots in relation to mature, symptomless New Ze aland apples;  that, because the majority of 
consignments of New Zealand apples would be "ret ail-ready", if latently infected fruit were to 
develop visible rot symptoms in storage, this would be detected and removed at the time of packaging;  and, concerning infestation, that th e use of water dump tanks, generally followed by high-
volume, high-pressure water washing, would be high ly effective in removing external contaminants. 
7.586  Dr Swinburne notes initially that "any conidi a deposited on the surface of an apple during 
harvesting operations would not survive for any length of time ... and may be discounted from all 
subsequent calculations."
1963  In his opinion, "[s]imilar cons iderations would apply to conidia 
redistributed from trash.  There is, for example, no evidence to support assertions ... such as [that] 
'spores would survive waxing' or 'brushing', because  these processes are irrelevant to the inherent 
inability of conidia to survive for long periods."1964 
7.587  The experts agree in principle with the proposition that: 
"Although there is no relevant scientific eviden ce, it is acceptable to consider that no 
aspect of the process in the packing house reduces the number of latently infected 
fruits.  Once the fungus has penetrated mature fruits, the normal post-harvest 
management including brushing, waxing, sorting and grading, cold storage and even fungicide treatments, will be unable to a rrest the fungus inside the fruits.  Cold 
temperature would only be able to retard symptom development by lowering the rate 
of fungal growth."
1965 
7.588  Dr Latorre agrees with New Zealand that the use of water dump tanks, followed by high-
volume, high-pressure water washing, would be effective in removing external contaminants.1966  This 
is noted in the IRA.1967  In the words of the expert, "[t]he likelihood that inocula contaminating the 
surface of the fruits can survive this process, attach ed to the fruit surface, is negligible or zero and it 
should be disregarded from the risk analysis."1968 
7.589  Dr Latorre and Dr Swinburne caution that the IRA fails to take into account the effect of store 
conditions and the duration of storage.   Dr Swinburne has explained that: 
"It is usual for dessert apples to be harveste d into bulk bins that are transported to on-
site CA (controlled atmosphere) stores, where they are cooled, and sealed in 
                                                      
1962 Australia's IRA, Part B, pp. 125-126. 
1963 Dr Swinburne's reply to Panel questions 77, 78 and 79, in List of Replies from the scientific experts 
to questions posed by the Panel, para. 458. 
1964 Ibid. 
1965 Dr Latorre's reply to Panel question 79, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 454.  See also, Dr Deckers's reply to Panel question 79, in List of Replies from the scientific experts to questions posed by the Panel, para. 453. 
1966 Dr Latorre's reply to Panel question 79, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 456.  See also, Dr Sgrillo's reply to Panel question 80, in List of Replies from the scientific experts to questions posed by the Panel, para. 463. 
1967 Australia's IRA, Part B, p. 125. 
1968 Dr Latorre's reply to Panel question 79, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 456.  See also, Dr Swinburne's reply to Panel questions 77, 78 and 79, in List of 
Replies from the scientific experts to questions posed by the Panel, para. 458.  WT/DS367/R 
 Page 335 
 
 
 chambers with adjusted CO2 and O2 con centrations.  At intervals dictated by 
marketing strategies they are removed from these stores and dispatched to specialist 
pack houses, where the operations of washi ng, grading and packed for retail.  The 
process may extend over many months, which has not been factored into the IRA model.  Any infections present may develop in to rots during this time, and this will be 
strongly influenced by both the store temperature and environment (Berrie et al 2007, 
appendix 1).  At grading these would be removed, so the numbers of infected fruit will diminish with time, consequently th e statement that 'none of the pack house 
measures would reduce infection' is incorr ect, as it must also embrace the CA store 
period."
1969 
7.590  Dr Swinburne concludes that "the store conditi ons and the duration of the holding period will 
be a factor in any subsequent development of any quiescent infections that may be present (Berrie, Xu & Johnson 2007 in appendix)."
1970 
7.591  Dr Latorre concurs and notes that "symptoms may ap pear after several weeks of cold storage.  
If lots of mature asymptomatic fruits are kept for se veral weeks in cold storage in New Zealand, it 
would be possible to remove infected fruits be fore export to Australia, lowering the risk of 
entrance."1971 
7.592  Dr Latorre and Dr Swinburne find no justification in the IRA for the likelihood values 
assigned to this importation step.  In the words of Dr Swinburne, "[t]he probabilities assigned in the IRA to these steps are all difficult to reconcile with  the observations above, especially as they all omit 
the factor of time."
1972  Dr Latorre concurs, stating that, in hi s view, "[t]here is no scientific literature 
to support" the likelihoo d values estimated by the IRA for importation step 4.1973  This likelihood 
"falls within a range that is difficult to legitimize,  if this assumption implies that the inoculum must 
remain on the fruit surface.  Rather, it would be possible for the inoculum to be present internally in the fruit."
1974 
7.593  In conclusion, notwithstanding New Zealand's arguments, the IRA notes that processing 
procedures in the packing house would be effective in  removing external contaminants.  With respect 
to the small effect that processes in the packing house would have on the number of latently infected 
fruits, the IRA's discussion seems generally coherent  and suported by the scientific evidence cited.  
The IRA, however, fails to take into account the effect that store conditions and the duration of 
storage would have on the likelihood that Neonectria galligena  survives routine processing 
procedures in the packing house.  Regarding Australi a's argument that the estimation of the likelihood 
of this importation step was reached through the exercise of expert judgement by the IRA Team, the 
                                                      
1969 Dr Swinburne's reply to Panel questions 78, 80, 81, 82 and 83, in List of Replies from the scientific 
experts to questions posed by the Panel, para. 482.  See also, Dr Swinburne's reply to Panel questions 77, 78 and 79, in List of Replies from the scientific experts to questions posed by the Panel, para. 459. 
1970 Dr Swinburne's reply to Panel questions 77, 78 and 79, in List of Replies from the scientific experts 
to questions posed by the Panel, para. 459.  See also, Dr Deckers's reply to Panel question 80, in List of Replies 
from the scientific experts to questions posed by the Panel, para. 461. 
1971 Dr Latorre's reply to Panel question 79, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 455.  See also, Dr Deckers's reply to Panel question 79, in List of Replies from the scientific experts to questions posed by the Panel, para. 453. 
1972 Dr Swinburne's reply to Panel questions 77, 78 and 79, in List of Replies from the scientific experts 
to questions posed by the Panel, para. 460. 
1973 Dr Latorre's reply to Panel question 80, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 462.  See also, Dr Sgrillo's reply to Panel question 80, in List of Replies from the 
scientific experts to questions posed by the Panel, para. 467. 
1974 Dr Latorre's reply to Panel question 80, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 462. WT/DS367/R 
Page 336  
 
 Panel has already noted that the use of expert j udgement must be documented and transparent and it 
must be based on the relevant reliable scientific information.
1975  In this regard, the IRA does not 
provide any explanation for its estimation that th ere would be a minimum 70 per cent likelihood that 
Neonectria galligena  survives routine processing procedures in the packing house, and a most likely 
value of 85 per cent. 
7.594  Accordingly, the Panel finds that the IRA's estimation of the likelihood that Neonectria 
galligena  survives routine processing procedures in the p acking house is not objectively justifiable. 
(e) Alleged overestimation for importation step 5 
7.595  Importation step 5 represents the likelihood that clean fruit is contaminated during processing 
in the packing house.1976 
(i) Summary of the Parties' arguments 
7.596  Regarding importation step 5 for European ca nker, New Zealand submits that the IRA's 
estimation, like that for step 3, rests on the assu mption that infested or infected mature apples, 
assuming they exist, would contaminate clean fruit.  New Zealand argues, however, that the scientific 
evidence suggests that the likelihood of this ha ppening during processing in the packing house is 
negligible.1977 
7.597  New Zealand notes that the IRA acknowledges that  latent fruit infections have a "minimal 
likelihood" of contamination in the processing pa thway, because spores do not develop on infected 
fruit until they become severely rotted or mummified.1978  In New Zealand's view, the IRA's assertion 
that there is a probability, albeit "extremely low", of clean fruit becoming contaminated by twigs or by 
washing in the dump tank, is "unsubstantiated sp eculation", not supported by scientific evidence.1979 
7.598  In response, Australia contends that "New Zeal and failed to identify any flaws in the [IRA's] 
conclusions on Importation step 5."1980  Australia argues in this rega rd that, just as in the case of 
New Zealand's arguments in relation to importation step 3, it also rejects New Zealand's assertion that the IRA should have treated the probability of importation step 5 as "negligible".
1981  Australia adds 
that New Zealand mistakenly focuses on the qualita tive descriptors and not on the IRA's quantitative 
estimates.1982 
7.599  Australia submits that, in its arguments New Ze aland ignores the evidence that latent fruit rot 
caused by Neonectria galligena  occurs in New Zealand and its likelihood has increased.1983  Australia 
also argues that conidia from external infections can  be washed off in the dump tank water, potentially 
contaminating clean fruit.  In addition, post harvest  washing would not alter the incidence of storage 
                                                      
1975 See para. 7.440 above. 
1976 Australia's IRA, Part B, pp. 19-21. 
1977 New Zealand's first written submission, paras.  4. 288 and 4.292.  See also, New Zealand's second 
written submission, para. 2.541. 
1978 New Zealand's first written submission, para. 4. 289.  See also, New Z ealand's second written 
submission, para. 2.542. 
1979 New Zealand's first written submission, para. 4. 291.  See also, New Z ealand's second written 
submission, paras.  2.545-2.548. 
1980 Australia's first written submission, para. 594. 
1981 Australia's first written submission, para. 582. 
1982 Australia's first written submission, para. 588. 
1983 Australia's first written submission, para. 586.  WT/DS367/R 
 Page 337 
 
 
 rots in uninjured fruit, although apples with wounds would be prone to storage rots in the presence of 
high fungal concentration.1984 
7.600  Finally, Australia argues that the IRA consider ed evidence of the possibility that fruit can be 
contaminated by twigs in the dump tank.  In any ev ent, the likelihood of clean fruit getting infected in 
this manner was found to be "extremely low" and the IRA took this into account when estimating the 
probability range for importation step 5.1985 
(ii) The Panel's analysis 
7.601  The IRA estimates the likelihood that clean fruit is contaminated by Neonectria galligena  
during processing in the packing house as a triangular distribution with a minimum value of 10-5 (1 
in 100,000), a maximum value of 10-4 (1 in 10,000) and a most likely value of 5 × 10-5 (5 in 
100,000).1986  According to the IRA, "[t]his allows for the presence of a small number of spores in the 
packing processes that could contaminate fruit".1987 
7.602  The IRA notes that: 
"Given the extremely small likelihood of fruit being infested/infected with 
N. galligena, the probability of surface spor es being present on fruit and 
contaminating the dump water is similarly ex tremely small.  Foliage is not affected 
and leaf trash presents an insignificant c ontamination pathway unless fruit is picked 
along with twigs that have small cankers ... 
N. galligena spores are not able to penetrate intact apple fruit cuticle, although 
conidial contamination could take place th rough the calyx, lenticels, scab lesions or 
wounds caused by bruising.  Polishing could create minute damage on the surfaces of 
fruit, and this could assist the spread of inf ection.  However, the use of chlorine and 
other disinfectants in dump tanks and high-pressure apple washers when applied would remove epiphytic microbes to varying degrees.  Severely rotted fruit and twigs 
are largely eliminated during harvesting. ... 
[T]here would be a very large dilution of spores in the tank and surface contamination 
could be washed off in any subsequent hi gh pressure wash.  Where disinfectants such 
as chlorine are used in dump tanks, spores in the dump tanks will be quickly killed ... 
Cankers on the stalk of the apple have neve r been reported.  Further, to become 
established the organism must penetrate the cambium ... and it is not likely that a significant number of fruit stalks on the trees would be damaged to expose the cambium. 
Latent fruit infections present a minimal likelihood of contamination in the 
processing pathway because spores do not develo p on infected fruit until they become 
severely rotted or mummified ... 
The remainder of the processing in the packing house presents an insignificant 
likelihood of fruit contamination."
1988 
                                                      
1984 Australia's first written submission, paras. 587-589. 
1985 Australia's first written submission, paras. 590-593. 
1986 Australia's IRA, Part B, pp. 126-127. 
1987 Australia's IRA, Part B, p. 127. 
1988 Ibid. WT/DS367/R 
Page 338  
 
 7.603  As noted above, New Zealand's major arguments against the IRA's reasoning with respect to 
importation step 5 are:  that the scientific evidence s uggests that the likelihood of  infested or infected 
mature apples, assuming they exist, contaminati ng clean fruit during processing in the packing house 
is negligible;  and that the IRA's assertion that th ere is a probability, albeit "extremely low", of clean 
fruit becoming contaminated by twigs or by w ashing in the dump tank, is only unsubstantiated 
speculation, not supported by scientific evidence. 
7.604  The whole discussion in the IRA regarding importa tion step 5 supports the conclusion that the 
probability that clean fruit is contaminated by Neonectria galligena  during processing in the packing 
house is extremely small.  As noted above, the IR A concludes that "[g]iven the extremely small 
likelihood of fruit being infested/infected with N. galligena , the probability of surface spores being 
present on fruit and contaminating the dump water is similarly extremely small".
1989  Regarding 
Australia's statement that the IRA considered evidence of the possibility that fruit can be 
contaminated in the dump tank, Dr Swinburne notes that "[it] is not necessarily Nectria  that we are 
talking about ... [This is something that is known to  happen] for a number of other pathogens that 
cause rot, notably Penicillium expansum , the blue mould rot."1990  The IRA concludes that "[t]he 
likelihood of clean fruit getting infected due to twigs at this stage would be extremely low."1991 
7.605  Considering these statements, Dr Latorre opine d that the IRA's estimation of the likelihood 
values for this importation step is not supported on scientific evidence.  "There is no scientific 
literature to support the assumption that the rate of clean fruit contamination with N. galligena  would 
vary between 10-4 and 10-5 (most likely value of 5 × 10-5) (importation step 5) in the packing 
house."1992  In his view, "[b]ased on disease knowledge, [this contamination] is extremely unlikely to 
occur under normal fruit management.  This should be disregarded from the risk analysis."1993 
7.606  In conclusion, there is no support in the IRA for the estimation made for the likelihood of this 
importation step either in the scientific evidence cite d in the IRA, nor on the IRA's discussion in this 
regard.  Accordingly, the Panel finds that the IR A's estimation of the likelihood that clean fruit is 
contaminated by Neonectria galligena  during processing in the packing house is not sufficiently 
supported by the scientific evidence that the IR A relied upon and is accordingly not coherent and 
objective. 
(f) Alleged overestimation for importation step 6 
7.607  Importation step 6 represents the likelihood that in fected or infested fru it remains infected or 
infested during palletization, quality inspection, containerization and transportation to Australia.1994 
(i) Summary of the Parties' arguments 
7.608  Regarding importation step 6 for European ca nker, New Zealand submits that, "[i]n the 
absence of any supporting scientific data that could resolve this question for N. galligena , the 
                                                      
1989 Australia's IRA, Part B, p. 127.  See also, reply of Dr Sgrillo to Panel question 81, in List of 
Replies from the scientific experts to questions posed by the Panel, para. 468. 
1990 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 456. 
1991 Australia's IRA, Part B, p. 127.  See also, Dr Sg rillo's reply to Panel question 81, in List of Replies 
from the scientific experts to questions posed by the Panel, para. 468. 
1992 Dr Latorre's reply to Panel question 81, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 473.  See also, Dr Sgrillo's reply to Panel question 81, in List of Replies from the scientific experts to questions posed by the Panel, paras. 469-470. 
1993 Dr Latorre's reply to Panel question 81, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 473.  See also, Dr Deckers's reply to Panel question 81, in List of Replies from the scientific experts to questions posed by the Panel, para. 472. 
1994 Australia's IRA, Part B, pp. 19-21.  WT/DS367/R 
 Page 339 
 
 
 estimation of likelihood [for this step] can only be speculative but it must certainly be lower 
than '1'."1995 
7.609  New Zealand argues that the likelihood value est imated by the IRA for this step is an 
overestimation.  "[B]ecause, even assuming that some fruit could be latently infected at the point of 
palletisation, a proportion of fruit with latent inf ection would never develop symptoms ... The actual 
proportion of fruit with latent infection that might eventually develop symptoms would be much less 
than 100%."1996 
7.610  In response, Australia contends that "New Zeal and failed to identify any flaws in the [IRA's] 
conclusions on Importation step 6."1997  In this regard, Australia rejects that the likelihood value 
assigned to importation step 6 is an overestimation or is "speculative".1998  Australia argues that the 
study cited by New Zealand in support of its asser tion that some fruit with latent infection would 
never develop symptoms, is not entirely relevant as it does not deal with Neonectria galligena .  
Australia adds that infections in latently infected  fruit will often not manifest until after three to seven 
months in storage.1999 
7.611  Australia also rejects New Zealand's assertion that the probability assigned to importation 
step 6 must certainly be lower than 1.  In its vi ew, there is scientific support for the IRA's judgement 
of the likelihood value for this step.2000 
(ii) The Panel's analysis 
7.612  The IRA estimates the likelihood that Neonectria galligena  survives palletization, quality 
inspection, containerization and transportation to Australia as 1 (100 per cent).2001 
7.613  According to the IRA: 
"Some infected fruit not detected during sorting may be identified at quality 
inspection.  However, quality inspection will not detect latent infections or any surface infestation, and these will survive pa lletisation, containerisation and transport 
because there are no mechanisms in these procedures to remove them. 
The time between Imp4 and Imp6 will not be  long enough for latent infection to 
express itself to a significant level. Because spores are microscopic, any remaining 
surface infestation will also remain undetected and survive." 
7.614  As noted above, New Zealand's major arguments against the IRA's reasoning with respect to 
importation step 6 are:  that, in the absence of  supporting scientific data, the estimation of the 
likelihood for this step is only speculative but "mus t certainly be lower than 1";  and that, even 
assuming that some fruit could be latently infected at the point of palletisation, a proportion of fruit 
with latent infection would never develop symptoms  and therefore the actual proportion of fruit with 
latent infection that might eventually develop symptoms would be much less than 100 per cent. 
                                                     
 
1995 New Zealand's first written submission, para. 4. 295.  See also, New Z ealand's second written 
submission, paras.  2.556-2.558. 
1996 New Zealand's first written submission, para. 4.294.  See, Biggs, "Detection of Latent Infections in 
Apple Fruit with Paraquat" (1995), in Exhibit NZ-62. 
1997 Australia's first written submission, para. 598. 
1998 Australia's first written submission, paras. 596 and 598. 
1999 Australia's first written submission, para. 596. 
2000 Australia's first written submission, para. 598. 
2001 Australia's IRA, Part B, pp. 127-128. WT/DS367/R 
Page 340  
 
 7.615  The IRA cites no scientific evidence in support of its proposition that all Neonectria galligena  
would survive palletisation, quality inspection, containerisation and transportation to Australia.
2002  
The IRA states that "[t]he time between Imp4 and Im p6 will not be long enough fo r latent infection to 
express itself to a significant level".2003 
7.616  Dr Latorre notes that it would be reasonable to assume that post-harvest processing does not 
affect survival of latently infected fruits.  Therefor e, a value of 1 could be acceptable for the survival 
likelihood of the internal inocula.2004  With respect to the study cited by New Zealand in support of its 
assertion that "a proportion of fruit with latent in fection would never develop symptoms", the expert 
notes that Biggs (1995) is not relevant as it does not deal with Neonectria galligena .2005 
7.617  Notwithstanding the IRA's statement on the short time between importation steps 4 and 6, the 
conditions and the duration of stor age could have an effect on the subsequent development of any 
quiescent infections that may be present.2006  This effect was discussed earlier with respect to 
importation step 4.2007  The IRA dismisses this effect, noting that it would not "express itself to a 
significant level".  As Australia has repeatedly ar gued, however, that the likelihood of an event is 
extremely low or even negligible does not necessa rily make it equal to zero.  Indeed, the IRA 
acknowledges that "[s]ome infected fruit not detected during sorting may be identified at quality 
inspection."2008 
7.618  Notwithstanding his comment on the survival of la tently infected fruits, Dr Latorre explains 
that the situation would be differe nt for external inoculum.  "[T]hese post-harvest processes can affect 
survival of the external inoculum, epiphytical ly contaminating the fruit surface, which may be 
negligible.  Then a value of 1 would be unacceptable."2009 
7.619  In conclusion, New Zealand has not properly substantiated its argumen t for this importation 
step that a proportion of fruit with latent infecti on at the point of palleti sation would never develop 
symptoms.  At the same time, however, the IRA ack nowledges that some infected fruit not detected 
during sorting may be identified at quality inspection.  Additionally, the IRA fails to take into account 
the effects that the processes occurring during this step could have on external infestation.  The 
scientific evidence cited in the IRA does not support the estimation made for the likelihood of this 
importation step.  The IRA's estimation that there would be a 100 per cent likelihood that Neonectria 
galligena  survives palletisation, quality inspection, c ontainerization and transportation to Australia 
does not seem a coherent and objective conclusion from the IRA's discussion.  The likelihood of the 
removal of some surface contamination in fruits an d the detection of some latently infected apples 
during this step may be very small, but it would be different from zero. 
                                                      
2002 Dr Latorre's reply to Panel question 82, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 475. 
2003 Australia's IRA, Part B, p. 127. 
2004 Dr Latorre's reply to Panel question 82, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 475. 
2005 Ibid. 
2006 See, for example, Dr Swinburne's reply to Panel question 91, in List of Replies from the scientific 
experts to questions posed by the Panel, para. 523. 
2007 See para. 7.593 above.  See also, Dr Swinburne's replies to Panel questions 77, 78 and 79, in List of 
Replies from the scientific experts to questions posed by the Panel, para. 460;  Dr Latorre's reply to Panel 
question 79, in List of Replies from the scientific expe rts to questions posed by the Panel, para. 455;  and 
Dr Deckers's reply to Panel questions 79, 80 and 82, in List of Replies from the scientific experts to questions posed by the Panel, paras. 453, 461 and 474. 
2008 Australia's IRA, Part B, p. 127.  See also, Dr Sg rillo's reply to Panel question 82, in List of Replies 
from the scientific experts to questions posed by the Panel, paras. 476 and 477. 
2009 Dr Latorre's reply to Panel question 82, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 475.  WT/DS367/R 
 Page 341 
 
 
 7.620  In conclusion, the Panel finds that the IRA's estimation of the likelihood that Neonectria 
galligena  survives palletization, quality inspection, cont ainerization and transportation to Australia is 
not sufficiently supported by the scientific evidence that the IRA relied upon and, accordingly, is not 
coherent and objective. 
(g) Alleged overestimation for importation step 7 
7.621  Regarding the pests reviewed in the IRA, im portation step 7 represents the likelihood that 
clean fruit is contaminated during palletizat ion, quality inspection, containerization and 
transportation.2010 
(i) Summary of the Parties' arguments 
7.622  Regarding importation step 7 for European ca nker, New Zealand submits that the IRA's 
estimation "has no basis in science".2011  New Zealand argues that, although the IRA estimates the 
likelihood of the event as "negligible" and "sta tes clear reasons why" it would be so, once the 
likelihoods assigned to this step are used in the model, this results "in a negligible event being 
mischaracterised as an ev ent that is likely to occur – approximately one in every two million apples 
imported from New Zealand".2012 
7.623  In response, Australia contends that "New Zeal and failed to identify any flaws in the [IRA's] 
conclusions on Importation step 7."2013  In this regard, Australia argues that New Zealand mistakenly 
focuses on the qualitative descriptors and not on the IRA's quantitative estimates.2014 
7.624  Australia rejects New Zealand's assertion that  the probability range for importation step 7 
"has no basis in science".  In its view, the IRA Team  exercised its expert judgement when determining 
the likelihood of this importation step.2015 
(ii) The Panel's analysis 
7.625  The IRA estimates the likelihood that clean fruit is contaminated by Neonectria galligena  
during palletization, quality inspection, containeri zation and transportation as a uniform distribution 
with a minimum value of 0 and a maximum value of 10-6 (1 in 1,000,000).2016 
7.626  According to the IRA, "[p]acked fruit woul d be securely stored and would present a 
'negligible' likelihood of becoming contaminated during the palletisation, quality inspection and 
transportation.  The short period of storage and temperatures maintained during transportation would 
not be conducive to spore production."2017 
7.627  As noted above, New Zealand's main argument against the IRA's reasoning with respect to 
importation step 7 is that the numerical range assigned  to this step is inconsistent with the IRA's 
conclusion that the likelihood of the event represented by this importation step is negligible and that 
the IRA's estimation has no basis in science. 
                                                      
2010 Australia's IRA, Part B, pp. 19-21. 
2011 New Zealand's first written submission, para. 4. 296.  See also, New Z ealand's second written 
submission, paras.  2.561-2.564. 
2012 New Zealand's first written submission, para. 4. 296.  See also, New Z ealand's second written 
submission, paras.  2.560 and 2.565. 
2013 Australia's first written submission, para. 601. 
2014 Australia's first written submission, para. 600. 
2015 Australia's first written submission, para. 601. 
2016 Australia's IRA, Part B, p. 128. 
2017 Ibid. WT/DS367/R 
Page 342  
 
 7.628  As noted above, the IRA concludes that the likelihood of clean fruit becoming contaminated 
during palletization, quality inspection, contai nerization and transportation is "negligible".
2018  
Dr Latorre notes that there is no scientific evidence  in the IRA to suggest that the likelihood of the 
event represented by this importation step should be greater than zero: 
"There is no experimental evidence allowi ng us to assume that the likelihood that 
packed clean fruit is contaminated with N. galligena  would be different from zero, at 
Step 7.  Comments:  (i) At this stage it is unlikely that latently infected fruits develop 
symptoms and less likely that N. galligena  sporulates on the surface of latently 
infected fruits.  (ii) Even if the inoc ulum (conidia) is present, post-harvest 
dissemination by fruit contact would be extremely unlikely because fruit injuries are 
needed for infection.  (iii).This evaluation (S tep 7) falls within a range that could not 
be considered legitimate. I suggest disc ounting this step from the risk analysis."2019 
7.629  Nevertheless, while New Zealand does argue that the likelihood of this event should be zero;  
it does not contest the IRA's conclusion that the likel ihood would be "negligible".  In New Zealand's 
words, "[t]he key point made in New Zealand's first written submission regarding importation step 7 
concerned the incongruity between the description in th e IRA of the risk of contamination at this stage 
as 'negligible', and the application of a probab ility range with a midpoint of one in two million 
apples."2020 
7.630  After defining the likelihood of the event associat ed with this importation step as negligible, 
the IRA does not provide any scientific evidence to s upport its choice of estimation.  In any event, the 
Panel has already concluded that the IRA's choice of the probability interval "for events with a 
'negligible' likelihood of occurring (corresponding to  the qualitative descriptor 'the event would 
almost certainly not occur') is not properly justif ied in the IRA and would tend to overestimate the 
probability of entry, establishment a nd spread of the pests at issue".2021 
7.631  Accordingly, the Panel finds that the IRA's est imation of the likelihood that clean fruit is 
contaminated by Neonectria galligena  during palletization, quality in spection, containerization and 
transportation is not supported by a coherent and objective reasoning. 
(h) Estimation for importation step 8 
7.632  Importation step 8 represents the likelihood that in fected or infested fru it remains infected or 
infested after on-arrival minimum border procedures.2022 
(i) Summary of the Parties' arguments 
7.633  New Zealand submits that "it is difficult to fa ult the IRA's logic" regarding the estimation for 
this particular importation step.2023  New Zealand adds, however, that the IRA's conclusion on this 
step "is hardly meaningful".  "It depends on an assumption about mature, symptomless apple fruit 
                                                      
2018 Australia's IRA, Part B, p. 128. 
2019 Dr Latorre's reply to Panel question 83, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 479.  See also, Dr Deckers's reply to Panel question 83, in List of Replies from the scientific experts to questions posed by the Panel, para. 478. 
2020 New Zealand's second writte n submission, para. 2.560. 
2021 See para. 7.508 above. 
2022 Australia's IRA, Part B, pp. 19-21. 
2023 New Zealand's first writte n submission, para. 4.298.  WT/DS367/R 
 Page 343 
 
 
 being a pathway for the transmission of European canker  for which there is no scientific evidence, and 
for which the likelihood has been demonstrated to be negligible."2024 
7.634  Australia notes that New Zealand "does not contest this importation step".2025  A u s t r a l i a  
submits, nevertheless, that the product at issue in th is dispute is "mature apples free of trash, either 
packed or sorted and graded bulk fruit from New Zealand", and not "mature, symptomless apples".2026  
Australia also argues that New Zealand's allegation on the lack of scientific evidence that "mature, 
symptomless apple fruit" are a pathway for transmissi on of European canker is inconsistent with an 
earlier statement to the contrary by the Chief Plants Officer of New Zealand's Ministry of 
Agriculture.2027  Australia finally states that New Zealand has not demonstrated that the likelihood of 
"mature, symptomless, apples" being such a pathway is "negligible" in accordance with 
New Zealand's definition of that term.2028 
(ii) The Panel's analysis 
7.635  The IRA estimates the likelihood that Neonectria galligena  survives and remains with the 
fruit after on-arrival minimum border procedures is 1 (100 per cent).2029 
7.636  The IRA notes that "[o]n-arrival inspections of documentation would fail to detect fruit rot 
symptoms or latent infections, and these would re main when the fruit arrives in Australia.  The 
likelihood rating for this importation step would no t be significantly reduced by any normal on-arrival 
procedure."2030 
7.637  New Zealand has not called into question the IR A's estimation of the likelihood of the event 
represented by this particular importation step. 
(i) Alleged overestimation for the overall probability of importation 
7.638  The overall probability of importation represents the likelihood that an imported apple is 
infected or infested;  it results from the sum of the proportions associated with the ten individual importation pathways.
2031 
(i) Summary of the Parties' arguments 
7.639  Regarding the IRA's analysis of the like lihood of importation of European canker, 
New Zealand argues that "there is no objectiv e and rational relationship between the scientific 
evidence and the probability value th at is chosen at each step".2032  In New Zealand's view, 
"frequently a value is chosen in the absence of any scientific support at all".2033 
7.640  New Zealand submits that the IRA's analysis of the probability of importation of European 
canker is inconsistent with Ar ticle 5.1 of the SPS Agreement: 
                                                      
2024 New Zealand's first writte n submission, para. 4.298. 
2025 Australia's first written submission, para. 602. 
2026 Australia's first written submission, para. 603. 
2027 Ibid. 
2028 Ibid. 
2029 Australia's IRA, Part B, p. 128. 
2030 Ibid. 
2031 Australia's IRA, Part B, pp. 23-24. 
2032 New Zealand's first wr itten submission, para. 4.267.  S ee also, New Zealand's first written 
submission, para. 4.300. 
2033 New Zealand's first writte n submission, para. 4.267. WT/DS367/R 
Page 344  
 
 "The IRA's analysis of the probability of importation rests on a flawed contention that 
mature, symptomless apples provide a path way for the transmission of European 
canker, a contention which has been demonstrated to be unsupported by scientific evidence.  In support of this contention, it treats as probable a series of events that are 
no more than possible.  As a result, the IRA's analysis is not an analysis of likelihood 
at all.  Rather, it is speculation on the possi bility of entry, and does not conform to the 
obligation under Article 5. 1 of the SPS Agreement."
2034 
7.641  In response, Australia contends that, contrary  to New Zealand's assertion, "there is an 
objective or rational relationship between the scientif ic evidence and the pr obability value that is 
chosen at each step of the importation scenario."2035 
7.642  Australia notes that the infestation/infection rate of imported apples from New Zealand, 
corresponding to the overall probability of importing Neonectria galligena , was estimated by inserting 
the likelihoods for each importation st ep into the risk simulation model.2036 
(ii) Analysis of the Panel 
7.643  Regarding the overall prob ability of importation of Neonectria galligena , the IRA notes that: 
"When the above likelihoods  [for each of the importation steps] were inserted into 
the risk simulation model, the probability of importation of N. galligena was 
estimated as being 6.8 × 10–5 (mean), 3.5 × 10–5 (5th percentile) and 10–4 (95th 
percentile).  Therefore, the infestation/infection rate for N. galligena was estimated to 
be 0.0068% (mean) of the total proposed number of apples imported from New Zealand annually."
2037 
Arithmetically, the overall figure of 0.0068 per cent would result from adding the different individual 
likelihoods represented by each of th e ten potential importation paths. 
7.644  When considering the manner in which the IRA reached an estimation for the probability of 
importation of Erwinia amylovora , the Panel noted generally the experts' criticism of trying to reach a 
overall likelihood of importation by estimating i ndividual probabilities for each importation pathway 
and combining them.2038  Consulted by the Panel, Dr Paulin  noted that such exercise was "just not 
credible ".2039  Dr Paulin added that, if the overall figure "h ad any consistency, it is a figure that could 
be quite easily checked experimentally ... Such an experiment would have been more convincing than 
the present efforts by IRA to demonstrate what cannot be really demonstrated."2040  The same 
criticism would be applicable to the overall estimation of importation of Neonectria galligena . 
7.645  Regarding the IRA's estimation for some specific importation steps for European canker, 
Dr Latorre notes that "[the] IRA assigned a proba bility value to each [importation] step.  However, 
some of these steps (e.g., Steps 3, 5 and 7) are inde ed mere possibilities (hypot hesis rather than true 
                                                      
2034 New Zealand's first wr itten submission, para. 4.268.  S ee also, New Zealand's first written 
submission, paras. 4.299-4.300;  New Zealand's second written submission, para. 2.566-2.572. 
2035 Australia's first written submission, para. 526. 
2036 Australia's second written submission, para. 527. 
2037 Australia's IRA, Part B, p. 128. 
2038 See para. 7.354 above. 
2039 Dr Paulin's reply to Panel question 34, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 239 (original emphasis). 
2040 Ibid.  WT/DS367/R 
 Page 345 
 
 
 facts) that need to be confirmed.   In such cases, a probability equal to zero should be assigned or even 
better, disregard the steps consider ed almost certain not to occur."2041 
7.646  Irrespective of whether this exercise of tryi ng to reach an otherwise unsupported overall 
likelihood of importation by aggregating probabilities for individual importation paths is flawed, some 
of the figures estimated by the IRA Team are problem atic.  Indeed, if the estimations of one or more 
of the individual likelihoods are questionable, b ecause those estimations are either not supported by 
adequate scientific evidence or not based on a c oherent and objective reasoning, the overall figure 
necessarily becomes questionable.  Moreover, the IR A does not attempt to find justification for the 
estimated overall probability of importation, other than the aggregation of the different individual 
likelihoods represented by each importation step.2042  As noted by Dr Sgrillo, "[t]he result of a 
mathematical model is as good as the value assigned to its  variables.  Many of the parameters used in 
the simulation were considered overestimated be cause they didn't reflect the meaning of the 
qualitative category in the population.  As con sequence, the final result could also be 
overestimated."2043 
7.647  Dr Latorre noted that the overall value for th e likelihood of importation falls out of the range 
that could be considered legitimate on the basis of general knowledge rega rding European canker: 
"Considering that mature apple fruits are from areas where climate conditions are not 
particularly conducive for fruit infection, a mean infection/infestation rate of 
0.0068% falls out off the range that could be considered legitimate on the basis of 
general knowledge regarding the European ca nker.  This value may not explain the 
real infection/infestation rate;  theref ore, it needs to be validated before 
acceptance."2044 
7.648  Dr Swinburne agreed and noted that: 
"The end point of this analysis, predic ting that 0.0068% of apples imported will 
'carry' the disease is predicated on a starti ng point presumption of  a probability that 
each picked fruit is infected between 10 × E-6 & 10 × E-3, which at best is far too large 
to be credible.  (see Q75).  Given all the uncertainty in the calculations for the 
intermediate steps (see Q78-83) this  outcome does not inspire confidence."2045 
7.649  In the light of the conclusions reached earlier by the Panel regarding the IRA's estimations of 
individual importation steps2046, and of the lack of any separate justification and evidence in the IRA 
regarding the estimated overall likelihood of importati on, the Panel finds that the IRA's estimation of 
the overall probability of importation is not supporte d by the scientific evid ence that the IRA relied 
upon and, accordingly, is not coherent and objective. 
                                                      
2041 Dr Latorre's reply to Panel question 138, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 808. 
2042 Australia's IRA, Part B, p. 128.  See also, Table 4 in Australia's IRA, Part B, p. 24;  Dr Sgrillo's 
reply to Panel question 84, paras. 483-486;  Dr Sgrillo's reply in Transcript of the Panel's meeting with experts, 
para. 269. 
2043 Dr Sgrillo's reply to Panel question 84, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 489. 
2044 Dr Latorre's reply to Panel question 84, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 486. 
2045 Dr Swinburne's reply to Panel questions 84 and 85, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 497. 
2046 See paras. 7.545, 7.573, 7.594, 7.606, 7.620 and 7.631 above. WT/DS367/R 
Page 346  
 
 (j) IRA's analysis of the probability of entry, establishment and spread 
(i) Summary of the Parties' arguments 
7.650  Factors relevant to the estimation of the pr obability of entry, establishment and spread 
include:  the probability of importation (in accordan ce with the different importation steps);  the 
proximity value;  the probability of exposure;  th e probability of establishment;  and, the probability 
of spread.
2047 
7.651  New Zealand argues that, just as the IRA fails to evaluate the likelihood of entry of European 
canker, it also fails to evaluate th e likelihood of the "establishment or spread" of the disease within the 
meaning of paragraph 4 of Annex A to the SPS Agreement.2048  New Zealand submits that, as a result, 
Australia "failed to comply with its obliga tions under Article 5.1 [of the SPS Agreement]."2049  I n  
New Zealand's view, "the evaluation in the IRA of th e likelihood of entry, establishment and spread of 
European canker was not an evaluation of likelihood in  terms of the definition of 'risk assessment' in 
the SPS Agreement ."2050 
7.652  Regarding proximity and exposure, New Zealand su bmits that the IRA's analysis is based on 
assumptions about production and dispersal of spores, which find no support in science.2051  The IRA 
assigns probability values in a seemingly arbitrar y manner to various utility points based on their 
likelihood to be proximate to host plants, describ ing events that have a very low likelihood of 
occurring.2052  New Zealand adds that, without any scien tific evidence that this could occur under 
Australian conditions, the IRA assumes that a suffici ent quantity of spores could be produced from an 
infected apple and dispersed under suitable clim atic conditions to infect a susceptible host.2053  This 
would fail to take into account that not all late ntly infected fruit would express symptoms and 
symptomless fruit do not produce spores;  furthermore, even if symptoms were to develop, there is no 
evidence that conidia spores are produced from storag e rots or rots which develop after removal from 
cold storage from latently infected fruit.2054  Moreover, surface spores are short-lived because they are 
prone to desiccation without continued moisture a nd would likely be dead well before arrival in 
Australia.2055  New Zealand also argues that, taking into  account the scientific evidence cited by the 
IRA, under Australian conditions the likelihood of  perithecia development and thus ascospore 
production would be negligible.2056 
7.653  New Zealand submits that, even if latently infected New Zealand fruit could produce spores 
in Australia, these spores would need to be transferre d to a host plant.  Dispersal of conidia would 
primarily be by rain splash and thus only a few metres from a discarded apple.  Otherwise, the IRA would rely on airborne transfer of spores, but th ere is no evidence that airborne spores would develop 
                                                     
 
2047 Australia's IRA, Part B, p. 129.  See also, Australia's IRA, Part B, p. 17. 
2048 New Zealand's first written submission, paras. 4.301 and 4.325;  New Zealand's second written 
submission, paras. 2.658-2.661. 
2049 New Zealand's first writte n submission, para. 4.325. 
2050 New Zealand's second writte n submission, para. 2.686. 
2051 New Zealand's first writte n submission, para. 4.325. 
2052 New Zealand's first written submission, para. 4. 302;  New Zealand's se cond written submission, 
para. 2.574. 
2053 New Zealand's first written s ubmission, paras. 4.303-4.304. 
2054 New Zealand's first written submission, para. 4. 305;  New Zealand's se cond written submission, 
paras. 2.580 and 2.583-2.592. 
2055 New Zealand's first writte n submission, para. 4.309. 
2056 New Zealand's first written submission, paras. 4.306-4.307;  New Zealand's second written 
submission, paras. 2.580 and 2.593-2.608.  WT/DS367/R 
 Page 347 
 
 
 from mature, symptomless New Zealand apples.2057  New Zealand notes that most infection studies 
for host plant receptivity were c onducted under artificial conditions.2058 
7.654  New Zealand submits that, notwithstanding the fact that for infection to occur, the number of 
spores must be at or above a certain threshold,  there is no connection in the IRA between the 
quantitative data from the literature cited and th e ultimate assignment of probability values for 
exposure.2059  Moreover, the IRA misconstrues the relevant  literature regarding the climate conditions 
necessary for infection, is inconsistent with in formation from countries where European canker is 
present and fails to note that the climatic conditio ns in Australia are not conducive to European 
canker.2060  In New Zealand's view, the IRA contains  no evidence to support the suggested pathway 
via discarded apples on the ground:  "[T]he IRA's analysis of transfer of N. galligena  from a single 
discarded apple to a susceptible host is in rea lity a consideration of a series of remote 
possibilities."2061 
7.655  Regarding establishment and spread, New Zealand argues that the IRA's analysis is based on 
assumptions about climatic similarity and alte rnative hosts that have no support in science.2062  The 
IRA's consideration of alternative hosts for Neonectria galligena  for its contention for the likelihood 
of establishment and spread of European canker rela tes to northern hemisphere hardwood forest trees 
and uses information from the United Kingdom, Northe rn Europe and Nova Sc otia.  It would not 
necessarily follow that Neonectria galligena  will cause disease in these hosts in New Zealand and 
Australia where climatic conditions are less suitable for the disease.2063  New Zealand submits that, in 
its discussion of the outbreak of European canker in  Spreyton, Tasmania, the IRA overestimates the 
significance of the eradication program.  In New Zealand's view, the main reasons why European 
canker did not spread into other apple growing regions or alternative hosts during the outbreak, 
despite unrestricted movement of fruit from affected orchards, is that fruit are not a pathway for the 
disease under New Zealand and Australian conditions, and that the climate of Tasmania, as that of the 
rest of Australia, is not suitable for the establishment and spread of European canker.2064 
7.656  Finally, New Zealand submits that the IRA's conc lusion that for each of the scenarios there is 
a moderate or high likelihood of establishment and spread, which assumes these events "would be 
expected to occur with an even probability or that  [they] would be very likely to occur", is not 
supported by scientific evidence.2065  New Zealand concludes that, even if there were a pathway for 
the transmission of European canker to Australia  by mature, symptomless apples, the IRA fails to 
establish that the disease could subsequently establish or spread.2066 
                                                      
2057 New Zealand's first written submission, paras. 4.311-4.312;  New Zealand's second written 
submission, paras. 2.580 and 2.609-2.615. 
2058 New Zealand's first writte n submission, para. 4.313. 
2059 New Zealand's first written submission, para. 4. 314;  New Zealand's se cond written submission, 
paras. 2.580 and 2.618-2.626. 
2060 New Zealand's first written submission, paras. 4. 315 and 4.87-4.92;  New Zealand's second written 
submission, paras. 2.580 and 2.616-2.617. 
2061 New Zealand's first writte n submission, para. 4.317. 
2062 New Zealand's first written submission, para. 4. 325;  New Zealand's se cond written submission, 
para. 2.636. 
2063 New Zealand's first written submission, paras. 4.318-4.321;  New Zealand's second written 
submission, paras. 2.638-2.646 and 2.650-2.655. 
2064 New Zealand's first written submission, paras. 4.322-4.323;  New Zealand's second written 
submission, paras. 2.647-2.649. 
2065 New Zealand's first written submission, para. 4. 324;  New Zealand's se cond written submission, 
paras. 2.656-2.657. 
2066 New Zealand's first writte n submission, para. 4.325. WT/DS367/R 
Page 348  
 
 7.657  With regard to the IRA's analysis of proximity for Neonectria galligena , Australia responds 
that New Zealand does not address the issues raised in the IRA's discussion, but only asserts that the 
IRA used arbitrary proximity values.  Australia rejects that assertion and submits that the IRA 
provides a justification for all of the proximity ratings ;  many of the events in relation to proximity are 
assigned in the IRA a "very low" or an "extremely low" likelihood of occurring.
2067 
7.658  Australia argues that New Zealand exporters are lik ely to ship fruit in bulk bins that could be 
repacked and distributed in Austra lia for specific markets.  Australian retail outlets often display 
apples on tables or in crates, rather than in smal ler "retail ready" boxes.  Also, although one of 
Australia's largest supermarket chains introduced a sy stem of returnable plastic crates, it is unlikely 
that empty crates would be sent from Australia to Ne w Zealand in order for New Zealand exporters to 
pack their apples for Australia.  Orchard wholesal ers who would repack such fruit are in close 
proximity to commercial fruit crops.  In Australia's  view, this explanation justifies the IRA Team's 
proximity rating for commercial fruit crops and orchard wholesalers.2068 
7.659  Regarding the IRA's exposure analysis, Australia rejects New Zealand's ass ertion that there is 
no scientific evidence to show the likelihood that a sufficient quantity of spores could be produced 
from an infected apple and dispersed under suitable climatic conditions to infect a susceptible host.2069  
Australia argues that "there is no doubt that some latently infected apples will arrive in Australia".2070  
The IRA cites studies showing that fruit rot caused by Neonectria galligena  occasionally occurs in 
New Zealand and the Chief Plants Officer of the New Zealand Ministry of Agriculture has endorsed 
the fact that "apple fruit are a pot ential pathway for the introduction of  European canker, as the fruit 
can develop latent or storage rots".2071  Australia also reiterates the IRA's views that rotting fruit in 
Australia would be discarded as waste and could be a s ource of inoculum and give rise to infections in 
new areas, if discarded near susceptible hosts.2072  Likewise, that infected fruit which become 
mummified can produce perithecia with mature ascospores and become a source of further infection.  Similarly, that rotting fruit, particularly with the New Zealand strain of Neonectria galligena  can 
produce both conidia and perithecia with ascospores.  Also that there is no reason why perithecia 
would not form on discarded rotting fruit in Australia in August.
2073 
7.660  Australia submits that it is well accepted that spores are dispersed by rain splash and wind and 
such dispersal could similarly apply to rotting fruit discarded as waste nearby a suitable host plant.  Birds and insects could also be a potential agent to  transfer the spores from infected fruit, carried on 
their beaks or feet, to branches of hosts where the fungus is known to establish easily.
2074  Dispersal 
                                                      
2067 Australia's first written submission, paras. 606-607.  See also, Australia's second written 
submission, para. 521. 
2068 Australia's first written submission, paras. 608-611. 
2069 Australia's first written submission, paras. 612-613.  See also, Australia's second written 
submission, paras. 507-510 and 520. 
2070 Australia's first written submission, para. 613. 
2071 Australia's first written submission, para. 613.  See, Atkinson, "Bacterial diseases of pip fruit" 
(1971), in Exhibit AUS-52;  Brook and Bailey, "Control of European canker" (1965), in Exhibit AUS-53;  
Braithwaite, "The occurrence of fruit rots caused by Nectria galligena  (European canker) in New Zealand and a 
comparison of brown rot strains between New Zealand and Australia" (1996), in Exhibit NZ-34;  communication from Biosecurity New Zealand, Ministry of Agriculture and Forestry (16 May 2005), in Exhibit 
AUS-51;  and communication from New Zealand's Ministry of Agriculture (15 July 1996), in Exhibit AUS-54.  
See also, Australia's first written submission, para. 670, Australia's second written submission, paras. 469 and 480-485. 
2072 Australia's first written submission, para. 614.  See also, Australia's second written submission, 
paras. 511-519. 
2073 Australia's first written submission, para. 614. 
2074 Australia's first written submission, paras. 615 and 635-636.  WT/DS367/R 
 Page 349 
 
 
 by "a few metres" is all that would be needed for a rotting apple in orchard wholesaler waste, or in a 
backyard compost heap, to transf er to a susceptible host plant. 
7.661  Australia argues that New Zealand's climate anal ysis suggesting a lack of climate conditions 
necessary for exposure is too narrow.2075  Neonectria galligena  causes infection over a range of 
temperatures under field conditions.2076  Australia's climate modelling would indicate that Australian 
climatic conditions are conducive to European canke r, as the potential distribution of European canker 
in Australia covers a much larger area than  suggested by New Zealand's climate analysis.2077  Under 
Australian conditions, conidia a nd ascospores would be produced.2078  One of the probable reasons for 
the limited spread of the disease during the Tasmania n outbreak, is that the Tasmanian strain of 
Neonectria galligena  was a unique strain that require d another mating type for sexual 
reproduction.2079 
7.662  Regarding New Zealand's criticism of the IRA's ex posure analysis, Australia submits that the 
product at issue is not mature, symptomless apples2080, that fruit rot after removal from cold storage 
has been shown2081, and that spores can be dispersed from mummified apples on the ground.2082  
Australia also rejects what it considers to be New Zealand's attempt to impose its own methodology 
on other WTO Members, by focusing on qualitative d escriptors and not on the numbers contained in 
the IRA.2083 
7.663  Australia argues further that not all conidia s uperficially present on fruit would be killed by 
desiccation.2084  Australia submits that the laboratory st udies of pathogens taken into account by the 
IRA were relevant for the discussion on host plant receptivity and the IRA Team took into account the 
fact that they had been conduc ted under laboratory conditions.2085  Australia adds that discarded 
apples can survive long enough to develop rots and produce spores2086 and that New Zealand 
misrepresents the threshold number of spores required to initiate infection.2087 
7.664  Australia concludes that the exposure values in  the IRA are supported by scientific evidence 
and New Zealand has failed to establish any flaws.  Australia rejects New Zealand's assertion that 
there is no connection between the literature cited a nd the IRA's assignment of exposure values.  The 
IRA would provide a justification for all of the exposure values for Neonectria galligena ;  in the IRA 
most of the exposure events are assigne d a "negligible" likelihood of occurring.2088 
7.665  Regarding the IRA's analysis for the probability of Neonectria galligena  establishing on a 
host plant and the probability of it spreading to ot her hosts, Australia argues that the IRA provides a 
justification for all the probabilities.  With the ex ception of the likelihood of spread to wild and 
amenity plants, all the scenarios described in th e IRA have a "moderate" or "high" likelihood of 
                                                      
2075 Australia's first written submission, para. 616. 
2076 Australia's first written submission, para. 627. 
2077 Australia's first written submission, paras. 616 and 627-629. 
2078 Australia's first written submission, para. 630. 
2079 Australia's first written submission, paras. 631-632. 
2080 Australia's first written submission, para. 618. 
2081 Australia's first written submission, paras. 619-621. 
2082 Australia's first written submission, paras. 622-623. 
2083 Australia's first written submission, paras. 624-626. 
2084 Australia's first written submission, paras. 633-634. 
2085 Australia's first written submission, paras. 637-638. 
2086 Australia's first written submission, paras. 639-640. 
2087 Australia's first written submission, paras. 641-642. 
2088 Australia's first written submission, paras. 643-644.  See also, Australia's second written 
submission, para. 521. WT/DS367/R 
Page 350  
 
 occurring.
2089  Australia rejects New Zealand's complaint that the IRA's conclusions on the likelihood 
of establishment and spread are not  supported by scientific evidence.2090 
7.666  In this respect, Australia argues that Neonectria galligena  affects alternative hosts in 
New Zealand and elsewhere, and studies from other countries in this regard are not irrelevant.2091  
New Zealand's allegation that there is no eviden ce of European canker causing pathogenic symptoms 
in other host plants would seem incons istent with evidence showing that Neonectria galligena  causes 
considerable damage to trees in private gardens in New Zealand.2092 
7.667  As with respect to the exposure analysis, Austra lia argues that New Zealand's climate analysis 
suggesting a lack of climate conditions necessary fo r the establishment and spread of European canker 
is too narrow.  In its view, Australian climatic c onditions are suitable for the establishment and spread 
of European canker.2093  Australia argues that the IRA Team did not overestimate the significance of 
the eradication program in Tasmania.  It reiterates some reasons for the limited scope of the Tasmanian outbreak, including the existence of a unique strain of Neonectria galligena  and that 
conidia were the only mechanism for disease spread, in the absence of sexually produced 
ascospores.
2094 
7.668  Finally, Australia argues that New Zealand's pr oposition that the export trade over the last 15 
years provides no evidence for spread  of European canker is "hollow, given that the vast majority of 
New Zealand's exports have been to co untries that already have the disease."2095 
7.669  Australia concludes that New Zealand has failed to identify any flaws in the IRA's assessment 
of establishment and spread, "let alone any flaws serious enough to prevent the Panel from having 
'reasonable confidence' in the risk assessment".2096 
(ii) The Panel's analysis 
7.670  In its estimate of the probability of entry, est ablishment and spread of European canker, the 
IRA has taken into account the following factors:  th e probability of importation, that has already been 
discussed with respect to the different importation st eps;  the proportion of utility points near host 
plants susceptible to the pest in each exposure grou p, titled "proximity";  the probability of exposure 
of a susceptible host plant in the ex posure group to the pest by an  infested/infected apple discarded 
near it, titled "exposure";  the probability of est ablishment;  and, the probability of spread."2097 
7.671  The probability of importation, combined with the proximity and the exposure analyses, result 
in the overall probability of entry.  All scenarios s ubsequent to the probabilit y of importation that has 
been discussed above are only relevant under th e assumption that imported apples from New Zealand 
would be either internally latently inf ected or superficially contaminated with Neonectria galligena . 
                                                      
2089 Australia's first written submission, para. 645. 
2090 Australia's first written submission, paras. 646-647. 
2091 Australia's first written submission, paras. 648-649.  See also, Australia's second written 
submission, paras. 522-531. 
2092 Australia's first written submission, paras. 650-653. 
2093 Australia's first written submission, paras. 650 an d 656-659.  See also, Australia's second written 
submission, paras. 532-550. 
2094 Australia's first written submission, paras. 655 an d 660-669.  See also, Australia's second written 
submission, paras. 551-570. 
2095 Australia's first written submission, para. 671. 
2096 Australia's first written submission, para. 672. 
2097 Australia's IRA, Part B, p. 129.  See also, Australia's IRA, Part B, p. 17.  WT/DS367/R 
 Page 351 
 
 
 Proximity  
7.672  Under its proximity analysis for European canker, the IRA assesses "the likelihood that a 
utility point is sufficiently close to a host plant in  a particular exposure group, to allow for a non-zero 
likelihood of transfer of [ Neonectria galligena ] to a host to occur."2098  More specifically, "[t]he IRA 
Team assessed the proximity  of major handlers and users of apples to host plants for N. galligena ."2099  
The IRA considers the following utility points:  orchard wholesalers, urban wholesalers, retailers, 
food services and consumers.  It also considers the following exposure groups:  commercial fruit 
crops, nursery plants, household and garden plants and wild and amenity plants.  The IRA describes 
issues specific to each utility point and estimates pr oximity ratings for the combination of each utility 
point with exposure groups (proximity values).2100 
7.673  New Zealand has submitted few arguments to contest the IRA's analysis on proximity.  It has 
mainly argued that the IRA has assigned proxim ity values in a seemingly arbitrary manner. 
7.674  As noted above with respect to the proximity an alysis for fire blight, when consulted by the 
Panel the experts expressed scepticism regarding so me of the scenarios considered under the IRA's 
proximity analysis.2101  Most of these concerns are also rele vant for the IRA's proximity values for 
European canker, since those values are the same  as the ones estimated for fire blight.  Most 
importantly, as noted by Dr Paulin, while the IRA's as sessment is "apparently coherent", it is not clear 
how the relative levels of probabilit y for each situation were evaluated.2102  In the case of European 
canker, Dr Latorre coincides with Dr Paulin in that the IRA would overemphasize the importance of 
the scenario where apples are repacked at rura l packing houses if apples from New Zealand are 
imported as retail-ready, because in this case they would probably not be processed in proximity to 
host plants.2103  In the words of Dr Latorre, "[t]he assessm ent and implication of the repacked apples 
at rural packing houses in close proximity to the or chards is a possibility that cannot be denied.  
However, the impact of repacked fruits can be mini mized if fruit is exported in retail-ready packs, as 
New Zealand has suggested."2104 
7.675  Although the IRA offers little e xplanation and supporting eviden ce for its reasoning regarding 
the estimation of the different proximity values, the Panel finds that New Zealand has not made a 
prima facie case that the IRA's discussion on utilit y points and estimated pr oximity ratings for the 
combination of each utility point with exposure groups (proximity values) is not objectively 
justifiable. 
Exposure  
7.676  Under its exposure analysis, the IRA assesses "t he likelihood of transfer of the pathogen from 
infested or infected apples to a susceptible host plant."2105  According to the IRA, the following 
factors were taken into account in its exposure analys is for European canker:  waste disposal, location 
of fungi, survival and viability of the fungus in or  on the fruit, transfer mechanism, availability of 
                                                      
2098 Australia's IRA, Part B, pp. 129-134, 24-27 and 29. 
2099 Australia's first written submission, para. 606. 
2100 Australia's IRA, Part B, pp. 129-134;  Australia's IRA, Part B, pp. 24-27. 
2101 See para. 7.379 above. 
2102 Dr Paulin's reply to Panel question 46, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 295. 
2103 Dr Paulin's reply to Panel question 52, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 335. 
2104 Dr Latorre's reply to Panel question 91, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 521.  See also, Dr Paulin's reply to Panel question 46, in List of Replies from the scientific experts to questions posed by the Panel, para. 295. 
2105 Australia's IRA, Part B, p. 134.  See also, Australia's IRA, Part B, p. 27. WT/DS367/R 
Page 352  
 
 entry points, inoculum dose, host plant receptivity, environmental factors and features specific to each 
exposure group (commercial fruit crops, nursery plan ts, household and garden plants and wild and 
amenity plants).
2106  After discussing these factors, the IR A estimates the probabilities of exposure for 
all utility point-exposure group combinations for Neonectria galligena , as summarized in Table 33 of 
the IRA.  The IRA states that "[a] significant exposure factor for N. galligena  is the fact that the 
fungus has a specific mechanism for spore dispersal."2107 
Waste disposal 
7.677  With respect to waste disposal, the IRA notes th at "[m]ost consumer waste is disposed into 
landfills, presenting a very small ri sk for subsequent exposure of N. galligena ;  however, an 
increasing amount is being disposed of in backyard compost heaps.  Some waste is also disposed 
directly into the environment along roadsides a nd recreational areas, presenting potential inoculum 
sources for transfer to susceptible host plants."2108 
7.678  New Zealand has not disputed the IRA's asser tion that an increasing amount of consumer 
waste could be disposed of in backyard compost heaps and that some consumer waste may also be 
disposed directly into the environment along roadsi des and recreational areas.  In any event, the IRA 
does not cite any particular evidence to support its  analysis of waste disposal for the purpose of 
European canker exposure.  Nor is any evidence c ited for the IRA's proposition that such waste would 
present "potential inoculum sources for tr ansfer to susceptible host plants". 
Location of fungi 
7.679  With respect to the location of fungi, the IRA notes that: 
"Fruit infection typically takes place at th e blossom end of the fruit through the open 
calyx or stem end, as well as through lenticels and scab lesions (Swinburne, 1975;  
Bondoux and Bulit, 1959).  This infection l eads to the development of a rot and has 
been reported to spread to  the seed cavity (Bondoux and Bulit, 1959), although this 
was not observed in California (McCartney, 1967).  As the rot progresses, the fruit may become mummified followed by the development of perithecia in autumn, 
releasing ascospores in winter and spring (Munson, 1939;  Grove, 1990a)."
2109 
7.680  New Zealand has not disputed the IRA's assertions regarding the location of fungi in infected 
apple fruit.  Nevertheless, the Panel has alread y noted the flaws in the IRA's assertions on the 
mummification of fruits, the development of perithecia  and the release of ascospores.  With regard to 
the IRA's discussion of importation step 2, the Pa nel has noted Dr Swinburne's statement that the 
paper by Braithwaite (1996) "[speculates] that rotte d fruit can transmit infection, basing his argument 
on European observations on the formation of ascospores on mummified fruit."2110  Dr Swinburne 
                                                      
2106 Australia's IRA, Part B, pp. 134-139.  See al so, Australia's IRA, Part B, pp. 17 and 27. 
2107 Australia's IRA, Part B, p. 138. 
2108 Australia's IRA, Part B, p. 134. 
2109 Australia's IRA, Part B, p. 134.  See, Swinburne, "European Canker of Apple ( Nectria galligena )" 
(1975), in Exhibit NZ-9;  Bondoux and Bu lit, "Sur la pourriture des pommes due au Cylindrocarpon mali  (all.) 
Wr." (1959), in Exhibit AUS-61;  McCartney, "An unusual occurrence of eye rot of apple in California due to 
Nectria galligena " (1967), in Exhibit NZ-10;  Munson, "Observations on apple canker.  I. The discharge and 
germination of spores of Nectria galligena  Bres." (1939), in Exhibit NZ-37;  Grove, "Nectria canker" (1990), in 
Exhibit NZ-7. 
2110 See para. 7.537 above.  Dr Swinburne's reply to Panel questions 54 and 55, in List of Replies from 
the scientific experts to questions posed by the Panel, pa ra. 349.  See, Braithwaite, "The occurrence of fruit rots 
caused by Nectria galligena  (European canker) in New Zealand and a comparison of brown rot strains between 
New Zealand and Australia" (1996), in Exhibit NZ-34.  WT/DS367/R 
 Page 353 
 
 
 suggests that "[t]his is a very rare occurrence, and most unlikely to be found in the climates of NZ or 
Australia ... For  these reasons this asp ect of the paper can be disregarded."2111  In response to a 
different question, Dr Swinburne confirmed his view :  "[i]t is most unlikely that rotted fruit would 
produce ascospores so [ascospores] need not be considered further here."2112  Regarding the IRA's 
discussion of importation step 3, the Panel also noted  the views of Dr Latorre and Dr Swinburne that 
there is no evidence of the development of pe rithecia and the release of ascospores from rotted 
fruit.2113  The Panel concluded with regard to those importation steps that the IRA does not contain 
scientific evidence regarding the po ssibility that latently infected but symptomless fruit could develop 
rot and generate Neonectria galligena  spores, which could then be transferred to clean fruit;  nor is 
there scientific evidence in the IRA to support the pr oposition that perithecia would play a role in the 
contamination of clean fruit.2114 
Survival and viability of the fungus in or on the fruit 
7.681  With respect to the survival and viability of th e fungus in or on the fruit, the IRA notes that: 
"N. galligena can readily survive at temperatures between 2 to 30°C (Munson, 1939;  
Butler, 1949) although Latorre et al. (2002) demonstrated under controlled 
environmental conditions using high fungal i noculum levels (106 conidia/mL), that 
no infection occurred at 5°C regardless of wetness duration.  The cool storage and 
transport process would not adversely aff ect the viability of the fungus.  Latent 
infections could remain, with fungal grow th and fruit rot resuming when fruit is 
removed from the cool chain, sold to cons umers and stored at room temperature. ... 
The fungus has been associated with storag e rots of apples suggesting that latent 
infections also occur in New Zealand fruit an d such fruit if discarded near susceptible 
hosts could be a source of inoculum for inf ections in new areas.  Fruit discarded into 
the environment could further rot, beco me mummified and develop viable fungal 
inoculum, conidia or perithecia that coul d initiate new infection although perithecia 
rarely develop on infected fruit in waste dumps ... 
Apple waste disposed of in landfills and compost may be subjected to high 
temperatures (60°C), which may kill the f ungus – many fungi are killed within a few 
days during composting ... Apple waste dis posed of in landfills or compost heaps 
would be rapidly contaminated and col onised by saprophytic microorganisms, 
hastening the decay process and minimising the likelihood of perithecia development.  Similarly insects, mammals or birds could consume apple waste. 
N. galligena does not produce resting cells and spores are killed by prolonged 
desiccation from high temperature and low relative humidity (Dubin and English, 1975a).  Liquid phase water is required for germination of conidia and their viability 
                                                     
 
2111 Dr Swinburne's reply to Panel questions 54 and 55, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 349. 
2112 Dr Swinburne's reply to Panel question 73, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 426. 
2113 See paras. 7.567-7.568 above.  Dr Latorre's replies to Panel questions 70 and 77, in List of Replies 
from the scientific experts to questions posed by the Panel, paras. 410 and 444-445;  Dr Swinburne's reply to 
Panel questions 67 and 68, in List of Replies from th e scientific experts to questions posed by the Panel, 
para. 404;  Dr Latorre's replies in Transcript of the Panel's meeting with experts, paras. 413, 459 and 486;  Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 461. 
2114 See, for example, para. 7.572 above. WT/DS367/R 
Page 354  
 
 is sharply reduced when exposed to relati ve humidity between 85 to 100% for 3 to 12 
hours at 11°C and 19°C (Dubin and English, 1975a)."
2115 
7.682  The Panel has already noted the experts' statem ents that the fungus would not survive as a 
surface contaminant.2116  As explained by Dr Latorre, "[t]here  is no information demonstrating that 
conidia or ascospores of N. galligena  can survive epiphytically (as surface contaminant) on mature 
apple fruits.  It is important to consider that c onidia survive desiccation for relatively short periods 
and it would be very unlikely that conidia and asco spores, contaminating apple surfaces, can survive 
post-harvest fruit management."2117 
7.683  Dr Latorre has added that, "in order for the fruit to  be infected ... you have to have some other 
conditions at the same time.  There are some weat her requirements that are very important, but more 
important than that, you have to have a susceptible hos t and you have to have injuries.  Otherwise, the 
infestation means nothing, that is the end of the in oculum.  It will not survive for a very long time."2118 
7.684  The evidence cited in the IRA suggests, howev er, that it is possible that the fungus could 
survive internally, even after cold storage.  In the words of Dr Latorre:  "Australia states that cool 
storage and transport processes would not adversely affect the viability of the fungus.  This may be 
true only for the fungus inside the fruit ... In other words, mycelia can surviv e in latently infected 
fruits;  growth may resume after cool storage a nd eventually the fungus may sporulate on the surface 
of mummified fruits."2119 
7.685  In this respect, New Zealand argues that th e IRA misconstrues the relevant literature 
regarding the climate conditions necessary for infection.2120  Dr Swinburne notes that "[t]here is no 
information on the effect of temperature on spor e formation or discharge, only for infection."2121  In 
his view, in regions of intermittent rainfall it w ould be incorrect to assume that spores would be 
produced at all times.2122 
7.686  In any event, the survival and viability of  the fungus, however, would require specific 
climatological conditions.  The Panel has already noted, with regard to the IRA's discussion of 
importation steps 2 and 3, that certain climatological conditions are necessary for inoculum 
production, dissemination and infection.2123  Regarding the survival and viability of the fungus, 
Dr Latorre adds that "favourable climatic cond itions are compulsory for sporulation (inoculum 
                                                      
2115 Australia's IRA, Part B, pp. 134-135.  See, Munson, "Observations on apple canker.  I. The 
discharge and germination of spores of Nectria galligena  Bres." (1939), in Exhibit NZ-37;  Butler, "Apple 
canker, Nectria galligena  Bres." (1949), in Exhibit AUS-60;  Latorre et al ., "The effect of temperature and 
wetness duration on infection and a warning system for European canker ( Nectria galligena ) of apple in Chile" 
(2002);  Dubin and English, "Effects of temperature, relative humidity, and dessication on germination of 
Nectria galligena  conidia" (1975), in Exhibit NZ-12. 
2116 See, for example, para. 7.588 above. 
2117 Dr Latorre's reply to Panel question 49, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 308.  See also, Dr Swinburne's reply to Panel question 49, in List of Replies from the scientific experts to questions posed by the Panel, para. 310. 
2118 Dr Latorre's reply in Transcript of the Panel's meeting with experts, para. 452. 
2119 Dr Latorre's reply to Panel question 71, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 413. 
2120 New Zealand's first written submission, paras. 4. 315 and 4.87-4.92;  New Zealand's second written 
submission, paras. 2.580 and 2.616-2.617. 
2121 Dr Swinburne's reply to Panel question 56, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 354. 
2122 Dr Swinburne's reply to Panel question 56, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 354. 
2123 See paras. 7.544 and 7.572 above.  WT/DS367/R 
 Page 355 
 
 
 production, mainly conidia), dissemination and survival of the inoculum."2124  These climatic 
conditions require a combination of adequate temperatures and wetness. 
7.687  Dr Swinburne notes that: 
"Data from Northern Europe, California and Chile on the basic weather conditions for 
infection (in the strict sense) have b een determined from artificial inoculation 
experiments (summarised in Swinburne, 1975;   CAB 2001, and Latorre et al 2001).  
This data will be relevant to all apple grow ing regions, but as they refer to just one 
aspect of the cycle of events, can not be u sed alone to predict the suitability of any 
region for the disease.  The essential weakness of the approach in the IRA is that it 
assumes that inoculum (spores) for infection is always available, and all that is 
required is a suitable period (hours of l eaf wetness within given temperature limits) 
for infection to occur."2125 
7.688  Based on the available evidence, Dr Latorre notes that "temperatures and rainfalls are 
relatively unfavourable for N. galligena  during summer and early fall in Australia, which may be the 
most critical period for infection."2126  The Panel has also noted, on the basis of the available evidence 
and the opinions of the experts, that the IRA does not contain scientific evidence regarding the 
possibility that latently infected but symp tomless fruit could deve lop rot and generate Neonectria 
galligena  spores, which could then be transferred to new hosts.  The Panel has also concluded that 
there is no scientific evidence in  the IRA to support the proposition that perithecia would play a role 
in the contamination of new hosts.2127 
7.689  Dr Swinburne notes further that, under climatic conditions in Australia, it is unlikely that 
rotted apples discarded by consumers would become infectious units: 
"[Response to question] 99 by Australia [aft er the first meeting with the Panel] makes 
it clear that the IRA indicates that fruit discarded by consumers constitutes the greatest threat for the disease to enter the country.  Fruit out of store would be held at considerably less than 100%RH.  To become  infectious units, discarded apples would 
require a period of 'leaf wetness' to develop spores.  It is most unlikely that in the 
prevailing climate all rotted apples so di scarded would become infectious units."
2128 
7.690  In conclusion, the IRA contains respected and qualified scientific evidence regarding the 
possibility of Neonectria galligena  surviving internally in fru its under certain conditions of 
temperature and wetness.  The IRA, however, seems to assume that inoculum for infection would be always available, a proposition for which there is no  adequate support in the evidence.  There is also 
no evidence to support the IRA's proposition regardi ng the possibility of contamination of new hosts 
from rotten fruit. 
Transfer mechanism 
7.691  With respect to the transfer mechanism, the IRA notes that: 
                                                     
 
2124 Dr Latorre's reply to Panel question 66, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 398. 
2125 Dr Swinburne's reply to Panel question 66, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 399. 
2126 Dr Latorre's reply to Panel question 66, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 398. 
2127 See paras. 7.568, 7.572 and 7.680 above. 
2128 Dr Swinburne's reply to Panel question 91, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 524. WT/DS367/R 
Page 356  
 
 "N. galligena produces two types of spores:  aerially dispersed ascospores and water-
splashed conidia.  No studies exist in th e literature to demonstrate long-distance 
disease spread from fruit infections, but as indicated above, severely rotted or mummified fruit are capable of developi ng perithecia producing aerially disseminated 
ascospores. ... 
Transfer of European canker across borders or districts results from the movement of 
infected nursery stock (Cooke, 2003).  Although wind disperses some conidia in the absence of rain (Swinburne, 1971b) they are mainly splash-dispersed (Munson, 1939).  The most probable maximum distance for dispersal by rain splash is 10 m 
(Marsh, 1940) although one report suggests this might actually be as much as 125 m 
under stormy conditions (Swinbur ne, 1975). ... [D]istances are likely to be far less for 
conidia originating from infected fruit on the ground. ... 
Involvement of birds and insects as vectors is suspected, although transfer has not 
been demonstrated and N. galligena does not have any specific insect vectors or 
mechanisms to allow transmission from apples to a suitable host. ..."
2129 
7.692  The IRA's analysis for the transfer of spores is that "severely rotted or mummified fruit" 
would develop perithecia and produce aerially dissemin ated ascospores.  The Panel has already noted, 
on the basis of the available evidence and the opinions  of the experts, that the IRA does not contain 
scientific evidence regarding the po ssibility that latently infected but symptomless fruit could develop 
rot and generate Neonectria galligena  spores, which could then be transferred to new hosts.  In the 
words of Dr Swinburne: 
"[R]otted fruit incubated unde r conditions of high humidity can produce conidia, but 
it is extremely unlikely that they would pr oduce perithecia, still less that ascospores 
would be released.  The importance of high humidity to conidia production has to be stressed.  The surface of fruit held in cold  stores is usually moist, and fully developed 
rots usually produce conidia.  Fruits rotting subsequently in retail packs or in a 
domestic environment at less than 100% [relative humidity] are not likely to produce 
conidia."
2130 
The Panel has also concluded that there is no sci entific evidence in the IRA to support the proposition 
that perithecia would play a role in the contamination of new hosts.2131 
7.693  The IRA suggests that "wind disperses some conidia", but it subse quently dismisses this 
dispersal mechanism.  Dr Swinburne concurs that "[w]ind dispersal releases so few viable conidia 
(Swinburne, 1971) that these can be discounted."2132 
7.694  The possibility of dispersal of conidia by rain splash is documented.  However, as noted by 
the IRA, this dispersal would be limited to shor t distances.  In Dr Latorre's view, New Zealand's 
proposition that "[a]ny dispersal of conidia would pr imarily be by rain splash and would likely only 
                                                      
2129 Australia's IRA, Part B, pp. 135-136. 
2130 Dr Swinburne's reply to Panel question 69, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 408. 
2131 See paras. 7.568, 7.572 and 7.680 above. 
2132 Dr Swinburne's reply to Panel questions 67 and 68, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 404.  See also, Dr Swinburne's reply to Panel question 61, in List of Replies from the scientific experts to questions posed by the Pane l, para. 381;  and Dr Deckers's reply to Panel question 
67, in List of Replies from the scientific expe rts to questions posed by the Panel, para. 400.  WT/DS367/R 
 Page 357 
 
 
 be a few metres from a discarded apple ... is a cr edible conclusion supported by experimental 
evidence, published previously."2133 
7.695  Dr Swinburne adds that the dispersal of conidia by rain usually occurs within the same tree.  
"That some conidia production during summer does occur is indicated by the detection of fruit rots in NZ, albeit rarely.  These spores would be deposited in  rain-off within the affected tree (Swinburne, 
1971), or less likely from a neighbouring tree by splash dispersal (Munson 1939)."
2134 
7.696  As noted by Dr Swinburne, "[t]he dispersal distances for rain splashed conidia quoted in the 
literature referred to in Australia's IRA are the maxi mum estimates, and refer to conidia released from 
tree cankers above ground level."2135  In other words, for fruit rotting on the ground, and as the IRA 
itself acknowledges, "it is reasonable to exp ect that the distances would be smaller." 2136  Moreover, 
"for splash dispersal to operate from a rotted apple on the ground the lesion has to be facing upwards;  
thus subject to further chance."2137 
7.697  In other words, as stated by Dr Latorre: 
"Although the reasoning in Australia's IRA w ith respect to the dispersal range for 
conidia was objective and coherent and b ased on respected and qualified scientific 
sources, the information provided demons trates only that conidia (and possibly 
ascospores) of N. galligena  are short-distance disseminated.  Conidial dispersal can 
be expected within the infected tree (rai n-splash and runoff), from infected trees to 
healthy neighbouring trees (splash, wind-spl ash), and between neighbouring orchards 
(wind-splash)."2138 
7.698  In order to achieve transfer, dispersal of coni dia would additionally require the existence of 
certain climatic conditions.  As noted by Dr Swi nburne, "[c]onidia are dispersed by rain splash, over 
relatively short distances, especially so from ground le vel.  Thus to successfully transfer infection 
fruit would have to be very close to a susc eptible host and have th e appropriate weather 
conditions."2139  Dr Latorre adds that "temperatures a nd rainfalls are relatively unfavourable for 
N. galligena  during summer and early fall in Australia, which may be the most critical period for 
infection".2140 
7.699  The IRA cites no evidence to support its asserti on that the "involvement of birds and insects 
as vectors [in the transfer of Neonectria galligena ] is suspected".2141  Consulted by the Panel, 
Dr Latorre noted that "[t]here is no scientific  evidence demonstrating that birds and insects can 
disperse N. galligena .  These considerations are not acceptable and would not be legitimate according 
                                                      
2133 Dr Latorre's reply to Panel question 73, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 425.  See, New Zealand's first written submission, para. 4.311. 
2134 Dr Swinburne's reply to Panel questions 67 and 68, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 404. 
2135 Dr Swinburne's reply to Panel question 73, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 426. 
2136 Ibid. 
2137 Ibid. 
2138 Dr Latorre's reply to Panel question 73, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 423. 
2139 Dr Swinburne's reply to Panel question 58, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 366. 
2140 Dr Latorre's reply to Panel question 66, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 398. 
2141 Australia's IRA, Part B, p. 136. WT/DS367/R 
Page 358  
 
 to the standards of the scientific community."
2142  Dr Swinburne concurred and stated that "[t]here is 
no scientific evidence that birds or other vectors are involved in the dissemination of infective agents 
of N. galligena ."2143 
7.700  In conclusion, there is no adequate scien tific evidence to support the IRA's discussion 
regarding the transfer mechanism for Neonectria galligena .  The Panel has already noted that the IRA 
does not contain scientific evidence regarding the po ssibility that latently infected but symptomless 
fruit could develop rot and generate Neonectria galligena  spores, which could then be transferred.  
The possibility that wind can serve as a dispersal mech anism for conidia in the absence of rain is also 
not supported by scientific evidence.  Dispersion of conidia by rain splash would be very limited and, 
in order to achieve transfer, would also require cer tain climatic conditions, which are unlikely to be 
present in Australia, particularly during the most criti cal periods for infection.  Finally, there is no 
support in the IRA for the possibility that birds or insects could be involved as vectors in the transfer of Neonectria galligena . 
Availability of entry points 
7.701  With respect to the availability of entry points, the IRA notes that: 
"Entry points for infection by N. galligena are available throughout most of the year 
... with wound sites caused by leaf fall in au tumn and leaf cracks from onset of spring 
bud burst presenting natural infection sites ... Winter pruning cuts ... and lesions 
caused by other pathogens ... present other entry points for infection ... Infection can also be initiated in the absence of wounds  through natural openings for example, the 
calyx end of fruit or via lenticels ..."
2144 
7.702  As noted by Dr Swinburne, conidia are poor epi phytes;  they will not survive as a surface 
contaminant: 
"The conidia are relatively short lived in any event, particularly in a dry climate, and 
they cannot survive on the unbroken surface of an apple.  They do require an entry 
point in order to infect.  Conidia merely contaminating the surface of fruit at harvest 
will not play a part in any future latent in fection.  Those infections will already have 
taken place, as is known in the European cont ext, either through the calyx end, stem 
end or under very rare circumstances thr ough open lenticels, because in very wet 
climates the lenticels on the fruit are act ually open, enabling spores to enter."2145 
Inoculum dose 
7.703  With respect to the inocolum dose, the IRA notes that: 
                                                      
2142 Dr Latorre's reply to Panel question 88, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 507. 
2143 Dr Swinburne's reply to Panel question 88, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 508.  See also, Dr Deckers's reply to Panel question 88, in List of Replies 
from the scientific experts to questions posed by the Panel, para. 506. 
2144 Australia's IRA, Part B, p. 136.  With respect to the issue of the availability of entry points in 
Australia, see, New Zealand's second wr itten submission, paras. 2.627-2.634.  See also, Dr Latorre's reply to 
Panel question 58, in List of Replies from the scientific  experts to questions posed by the Panel, para. 364;  
Dr Swinburne's reply to Panel questions 84 and 85, in Li st of Replies from the scientific experts to questions 
posed by the Panel, para. 499. 
2145 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 434.  WT/DS367/R 
 Page 359 
 
 
 "The number of conidia required to in itiate an infection varies depending on 
environmental and host factors.  CABI (2003) reports that approximately 1000 
conidia are required for leaf scar infection;  however, in artificial inoculations under 
optimal laboratory conditions as few as 10 or  12 conidia ... have produced infections 
and these numbers are considered to resemble  natural situations (McCraken et al., 
2003b).  Dubin and English (1974)  found that five conidia we re insufficient to initiate 
infection, while 50 to 500 did so readily.  Latorre et al. (2002) suggested that European canker is more aggressive in areas where abundant ascospores are produced 
during leaf fall."
2146 
7.704  Dr Latorre noted that the factors considered by the IRA regarding the inoculum dose 
necessary for infection "are acceptable".2147  The expert noted, however, that "it is difficult to judge 
the likelihood assigned to each parameter.  Although it is described in [page 136 of the IRA], it is not 
clear how Australia's IRA relates the inoculum dose necessary for infecti on and the pr obability of 
exposure to susceptible host plants."2148 
7.705  The IRA also fails to adequately recognize the importance of the number of spores for the 
likelihood of initiating an infection.  In this respec t, Dr Swinburne noted that, although in theory one 
cell can initiate infection, in practice the likelihood of  an infection increases with the dose.  "In theory 
one spore can initiate infection;  in practice the pr obability of successful infection with one spore is 
very small.  The literature cited in the IRA (p136) all indicate that the probability of securing infection 
increases with dose, and that at approximately 1000 spores per fresh leaf scar almost 100% infection 
will occur."2149 
7.706  The likelihood of infection will also depend on other factors, like the host cultivar.  "More 
recent data (Lolas, 1999, Ph.D. thesis University of  London) also demonstrates that the number of 
conidia needed to achieve 50% infecti on varies with cultivar;  another factor."2150 
Host plant receptivity 
7.707  With respect to host plant receptivity, the IRA notes that: 
"A large number of suitable hosts for European canker infection are widely 
distributed throughout Australia, with apples ( Malus spp.) and pears ( Pyrus spp.) 
grown commercially in most states.  In a ddition there are more than 20 other genera 
susceptible to N. galligena, each containing several species ... Entry sites are 
available throughout most of the year, alt hough the age of leaf scars and wound sites 
is of importance to infection."2151 
                                                      
2146 Australia's IRA, Part B, p. 136.  See, CABI, "Crop Protection Compendium" (2003), in Exhibit 
AUS-84;  McCraken et al ., "Relative significance of nursery infe ctions and orchard inoculum in the 
development and spread of apple canker ( Nectria galligena ) in young orchards" (2003), in Exhibit AUS-77;  
Dubin and English, "Factors affectin g apple leaf scar infections by Nectria galligena  Conidia" (1974), in Exhibit 
AUS-67;  and, Latorre et al., "The effect of temperature and wetness duration on infection and a warning system 
for European canker ( Nectria galligena ) of apple in Chile" (2002). 
2147 Dr Latorre's reply to Panel question 85, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 492. 
2148 Ibid. 
2149 Dr Swinburne's reply to Panel questions 84 and 85, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 498. 
2150 Dr Swinburne's reply to Panel questions 84 and 85, para. 498.  See also, Dr Deckers's reply to Panel 
question 85, in List of Replies from the scientific experts to questions posed by the Panel, para. 491. 
2151 Australia's IRA, Part B, p. 136. WT/DS367/R 
Page 360  
 
 7.708  As noted by Dr Swinburne, "for dispersal to l ead to an infection any adjoining host has to 
have sites receptive to conidia."
2152 
7.709  Regarding leaf scars, the IRA notes the conc lusion from Wilson (1966) that "infection could 
occur up to 4 weeks post leaf fall".  The IRA also notes, however, that according to Crowdy (1952) 
"leaf scars are highly susceptible to infection within th e first hour after leaf fall and become much less 
susceptible over the next hour".2153  Dr Swinburne refers to his own review of the different studies and 
notes that "[a]ll studies made under field conditions c onclude that leaf scars are susceptible only for a 
few hours after leaf fall (reviewed in Swinburne, 19 75), leading to the conclusion that the growth 
cabinets used by Wilson lead to conditi ons not normally encountered in nature."2154 
Environmental factors 
7.710  With respect to environmental factors, the IRA notes that: 
"Climatic conditions are critical for disease development, both for inoculum 
production and infection by N. galligena (Dubin and English, 1974).  Temperature 
and duration of wetness are critical factors contributing to transfer and successful infection (Swinburne, 1975;  Latorre et al., 2002).  N. galligena readily survives at 
temperatures from 2ºC to 30°C (Munson, 1939;  Butler, 1949) with the optimum 
temperature for disease development being be tween 20ºC to 25ºC.  These conditions 
are quite common in temperate and subtropical parts of Australia.  A minimum 2 to 6 h wetness duration is required at the op timum temperature (20°C) with a longer 
wetting period required at lower temperatur es (Latorre et al., 2002;  Grove, 1990a). ... 
Some regions in Australia (including the Adelaide Hills, Manjimup and Perth) 
experience annual rainfall over 1000 mm and this may be conducive to infection 
periods.  Environmental conditions in nurser ies, including use of overhead irrigation, 
may create favourable microclimates and be conducive to disease infection."
2155 
7.711  The Panel has already noted that certain cl imatic conditions, such as a combination of 
adequate temperatures and wetness, are necessary for inoculum production, dissemination and 
infection.2156  Dr Swinburne notes further that: 
"There is no information on the effect of temperature on spore formation or 
discharge, only for infection.  Latorre et al  (2002) demonstrated an interaction 
between temperature and the hours of leaf wetness required for the successful infection of leaf scars following artificial inoculation, which forms the basis for predictive model used in Chile.  The hours required decreased linearly with increases 
in temperature between 10 and 20 C, and at 20 C only 2 hours was needed, the 
shortest time so far recorded.  It has to be noted that a predictive model for leaf-scar 
infection such as that from Chile is based on the presumption (probably valid there) that conidia would be available at all times.   In regions of intermittent rainfall this 
would be incorrect (Wilson 1966), and therefore using for example the number of 
                                                     
 
2152 Dr Swinburne's reply to Panel question 73, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 427. 
2153 Australia's IRA, Part B, p. 136.  Wilson, "Development of European canker in a California apple 
district" (1966), in Exhibit NZ-64;  Crowdy, "Observations on apple canker IV. The infection of leaf scars" (1952). 
2154 Dr Swinburne's reply to Panel question 73, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 427. 
2155 Australia's IRA, Part B, p. 137 (footnote omitted). 
2156 See paras. 7.544 and 7.572 above.  WT/DS367/R 
 Page 361 
 
 
 rain days with suitable temperatures for l eaf-scar infection without allowing for spore 
production could overestimate the likelihood of infection.2157 
The Panel has concluded that those climatic c onditions are unlikely to be present in Australia, 
particularly during summer and early fall, the most critical periods for infection.2158 
Features specific to different exposure groups 
7.712  The IRA discusses features specific to differe nt exposure groups, namely:  commercial fruit 
crops;  nursery plants;  household and garden  plants;  and, wild and amenity plants. 
Conclusion on exposure 
7.713  The IRA summarizes the estimated  probabilities of exposure for all combinations of utility 
points and exposure groups in Table 33.2159  The IRA notes that "[a] significant exposure factor for N. 
galligena is the fact that the fungus has a specific mechanism for spore dispersal".2160 
7.714  The IRA states that the exposure values "are based on the IRA team's view taking into 
account all the factors discussed above."2161  As noted by Dr Sgrillo, however, it is not clear how the 
discussion in the IRA of the different factors was tr anslated into quantitative estimates.  In the words 
of the experts, "[t]he minimum and maximum para meters elected for the Exposure are not directly 
derived from the source data. … The IRA Team do es not explain how the available data were 
used."2162 
7.715  The Panel has already found that the IRA's reas oning with respect to several of the factors 
taken into account in its exposure analysis for Eu ropean canker is either not based on scientific 
evidence or not based on a coherent and objective reasoning.  With respect to waste disposal, for 
example, the IRA's assertion that consumer wa ste would present "potential inoculum sources for 
transfer to susceptible host plants" is not supported by evidence.  The IRA's exposure analysis also 
rests on assertions regarding the possibility that late ntly infected but symptomless fruit could develop 
rot and generate Neonectria galligena  spores, the mummification of fruits, and the possibility that 
perithecia would play a role in the contamination of new hosts that do not find sufficient support in the scientific evidence relied upon.  W ith respect to the survival and viability of the fungus, there is no 
support in the evidence for the IRA's apparent assumption that inoculum for infection would always 
be available.  With respect to the transfer mechanism for Neonectria galligena , the IRA does not 
contain scientific evidence that wind can serve as a dispersal mechanism for co nidia in the absence of 
rain.  The IRA's reasoning is not coherent and object ive as it fails to take into account that dispersion 
of conidia by rain splash would be very limited and,  in order to achieve transfer, would also require 
certain climatic conditions, which are unlikely to be  present in Australia, particularly during the most 
critical periods for infection.  There is no evidence in the IRA in support of the possibility that birds 
or insects could be involved as vectors in the transfer of Neonectria galligena .  The IRA's discussion 
on the availability of entry points fails to take into  account that conidia are poor epiphytes and will not 
survive as a surface contaminant.  Regarding th e discussion on inoculum dose, the IRA fails to 
                                                     
 
2157 Dr Swinburne's reply to Panel question 56, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 354. 
2158 See, para. 7.688.  See, Dr Latorre's reply to Pane l question 57, in List of Replies from the scientific 
experts to questions posed by the Panel, para. 358;  Dr Swinburne's reply to Panel question 75, in List of Replies 
from the scientific experts to questions posed by the Panel, para. 438. 
2159 Australia's IRA, Part B, pp. 138-139. 
2160 Australia's IRA, Part B, p. 138. 
2161 Ibid. 
2162 Dr Sgrillo's reply to Panel question 85, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 490. WT/DS367/R 
Page 362  
 
 explain how it took into account the inoculum dos e necessary for infection when estimating the 
probability of exposure to susceptible host plants.  Moreover, the IRA fails to adequately recognize 
the importance of the number of spores, and other factors such as the host cultivar, for the likelihood 
of initiating an infection.  The IRA's discussion rega rding environmental factors fails to take into 
account that the necessary climatological conditions for inoculum production, dissemination and 
infection, in terms of the appropriate combination of cool temperatures and wetness, are unlikely to be 
present in Australia, particularly during summer and ear ly fall, the most critical periods for infection. 
7.716  Regarding the exposure value estimated by th e IRA, Dr Swinburne notes additionally that: 
"The 'exposure value' quoted, assuming it is cred ible to deduce such a factor, seems to 
make assumptions regarding the year-round availa bility of infection sites, and that all 
discarded apples discharge spores all year, which are not correct.  Moreover by 
stating ' a significant exposure factor for  N. galligena is the fact that the fungus has a 
specific  mechanism for spore dispersal ' in the conclusion on p 138, [the IRA] 
suggests that the outcome was heavily reliant on the erroneous presumption that rotted fruit would release ascospores..."
2163 
7.717  Accordingly, and in the light of the shortcomings  that affect a number of sections of the IRA's 
conclusions on exposure, the Panel finds that, overa ll, these conclusions do not rely on adequate 
scientific evidence and, accordingly, are not coherent and objective. 
Establishment  
7.718  The IRA derives its conclusions regarding the probability of establishment from "a 
comparative assessment of those factors in the sour ce country and the 'PRA area' that are considered 
pertinent to the ability of a p est to survive and propagate".2164  These factors would include:  the 
availability of suitable hosts, alternate hosts and vectors in the PRA area;  the suitability of the 
environment;  the cultural practices and control m easures;  and other characteristics of the pest 
affecting the probability of establishment.2165  In the case of analysis of the probability of 
establishment for European canker, other factors incl ude:  the potential for adaptation of the pest;  the 
reproductive strategy of the pest;  the minimum popu lation needed for establishment;  and, the method 
of pest survival.2166 
7.719  Several of the flaws that the Panel has alread y noted with respect to the IRA's reasoning on 
exposure are also relevant for the analysis on estab lishment.  In its discussion of the availability of 
suitable hosts, alternate hosts and vectors in the PRA area, the IRA again contains unsupported 
assumptions regarding the year-round availability of  infection sites and on whether birds or insects 
could be involved as vectors in the transfer of Neonectria galligena .  In its reasoning, the IRA fails to 
take into account the evidence that conidia are poor epiphytes and will not survive as a surface 
contaminant.  In its discussion of the suitability of th e environment, the IRA fails to take into account 
the evidence that the climatic conditions necessary fo r the establishment of the disease, in terms of the 
appropriate combination of adequate temperatures a nd wetness, are unlikely to be present in Australia, 
particularly during summer and early fall, the most  critical periods for infection.  The IRA focuses on 
total annual rainfall, rather than on the hours of "leaf wetness" and on whether rainfall occurs during 
critical periods.  In its discussion of the minimum population needed for establishment, the IRA fails 
to explain how the inoculum dose necessary for in fection is related to the estimations of the 
                                                      
2163 Dr Swinburne's reply to Panel questions 84 and 85, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 499 (original emphasis). 
2164 Australia's IRA, Part B, p. 30. 
2165 Ibid. 
2166 Australia's IRA, Part B, pp. 139-141.  WT/DS367/R 
 Page 363 
 
 
 probability of initiating an infection in a susceptible hos t plant.  In its discussion of the method of pest 
survival, the IRA again relies on unsupported assertions regarding the possibility of the 
mummification of fruits that would then  produce perithecia and release ascospores. 
Spread  
7.720  The IRA derives its conclusions regarding th e probability of spread from "a comparative 
assessment of those factors in the source country and 'PRA area' considered pertinent to the expansion 
of the geographical distribution of a pest".2167  These factors would include:  the suitability of the 
natural and/or managed environment for natural spread  of the pest;  the presence of natural barriers;  
the potential for movement with commodities or co nveyances;  the intended use of the commodity;  
and the potential vectors of the pest in the PRA area.2168 
7.721  Several of the flaws that the Panel has alread y noted with respect to the IRA's reasoning on 
exposure and establishment are also relevant for th e analysis on spread.  In its discussion of the 
suitability of the natural and/or managed environment,  the IRA again fails to take into account that the 
climatological conditions necessary for spread of th e disease, in terms of the appropriate combination 
of cool temperatures and wetness, are unlikely to be present in Australia, particularly during summer 
and early fall, the most critical periods for infection.  The IRA notes that: 
"The fact the disease spread to a few orchards in Spreyton in Tasmania, probably 
after a single entry point indicates that the managed environment of Australia can be 
favourable for spread, although the extent of  dispersal was quite limited despite being 
present for many years.  This may have been because of the absence of air borne 
ascospores better suited to long-distance dispersal than conidia (Ransom, 1997), 
combined with unfavourable climatic cond itions (Spreyton receives less than 900 mm 
annual rainfall) and the use of  chemicals to control apple scab may also have limited 
disease spread. ... [I]n addition to the l ack of ascospore detection in Spreyton 
(Ransom, 1997), the limited spread can also be attributed to the eradication program 
which began within two years of confirmation of the disease (Ransom, 1997).  The 
program involved the use of chemicals to prevent the development of sporodochia, 
removal and burning of severely infected  trees, prohibition of movement of 
propagation material out of the quarantined zone, etc."2169 
7.722  In this respect, Dr Swinburne notes that, alt hough "[t]he dispute between the parties regarding 
the suitability of the climate in the fruit growing re gions of Australia for the establishment and spread 
of European canker in apple is difficult to resolve on the basis of the data available":2170 
"[T]he fact that canker has only been seen  in Tasmania and that western Tasmania 
has a higher number of days of rainfall (> 1m m) than mainland Australia is striking.  
Moreover, it may also be significant that even in Tasmania perithecia were not 
observed.  Thus it is difficult to escape the conclusion that the climate of fruit growing regions of mainland Australia are not conducive to the development of an 
epidemic of this disease (see Q72.)."
2171 
                                                      
2167 Australia's IRA, Part B, p. 31. 
2168 Australia's IRA, Part B, pp. 31 and 141-142. 
2169 Australia's IRA, Part B, p. 141. 
2170 Dr Swinburne's reply to Panel question 58, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 367. 
2171 Ibid. WT/DS367/R 
Page 364  
 
 7.723  Dr Latorre added that the experience of the Eu ropean canker outbreak in Spreyton, Tasmania, 
suggests that the disease would disseminate and subse quently spread in a new area relatively slowly: 
"On the basis of the biology of N. galligena  and considering the epidemiological 
characteristics of European canker, if N. galligena  were to enter a new area, I would 
expect a relatively slow dissemination of the pathogen and subsequent spread of 
European canker in this new area.  The in formation provided in relation to Spreyton 
supports the hypothesis of a very slow spread  occurred that would make it possible to 
eradicate N. galligena ."
 2172 
7.724  Dr Swinburne notes that one important factor  that the IRA fails to note regarding the 
Tasmanian European canker outbreak is that the disea se most likely originated with the importation of 
infected trees, and not with contaminated apple fruit: 
"[The Tasmanian outbreak] didn't spread to  native plants, but [Australia] had an 
enormous difficulty in getting rid of it, in  spite of constant pruning and cutting, and so 
forth.  Even though [there was] no inoc ulum ... no spore production. ... [T]hat 
infection was imported with the trees that [were] planted on that occasion.  Those 
trees were almost certainly infected when they put were in the ground.  The desperate 
difficulty that [Australia] had in getting rid of it from those individual trees was 
because it was semi-systemic infection.  In fact, the infection was moving through the 
tree inside.  Although you cut off a canker there, you were astonished to find another one appearing on a branch over there.  Bu t it had not spread from there to there 
directly, it had gone the other way, it had gone, as we now recognise, semi-systemic 
infection and that clean planting material is crucial to the prevention of canker."
2173 
7.725  Dr Latorre suggests that the fact that, despite this semi-systemic infection, European canker 
did not spread from Tasmania suggests that the c limatological conditions necessary for spread are not 
present in Australia.  "The lack of considerable  spread suggests that weather conditions are not 
favourable for European canker in Tasmania (Spr eyton, Tasmania, AUS FWS Annex 2;  Beresford 
and Kim, NZ Annex 3).  These relatively unfavourabl e climatic conditions may imply that prevalence, 
incidence and severity of European canker re mained low and that the disease never spread 
considerably outside Tasmania."2174 
7.726  Parties have conflicting views regarding the re levance of the experience of the Tasmanian 
European canker outbreak for the estimation of the pr obability of spread.  The experts found that the 
IRA's discussion of some of the factors associated with the limited spread of the infection to other 
regions, such as the combination of strict eradica tion measures and specific fungicide treatments, are 
generally reasonable.2175 
7.727  In its discussion of the potential for moveme nt with commodities or conveyances, the IRA 
notes that: 
                                                      
2172 Dr Latorre's reply to Panel question 59, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 369. 
2173 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 563.  See also, 
Dr Swinburne's reply to Panel question 90, in List of Re plies from the scientific experts to questions posed by 
the Panel, para. 518. 
2174 Dr Latorre's reply to Panel question 74, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 429.  See also, Dr Deckers's and Dr Swinburne's replies to Panel questions 74 and 90, 
in List of Replies from the scientific experts to qu estions posed by the Panel, paras. 428, 430 and 518. 
2175 Dr Deckers's, Dr Latorre's and Dr Swinburne's rep lies to Panel question 90, in List of Replies from 
the scientific experts to questions posed by the Panel, paras. 513, 514 and 517.  WT/DS367/R 
 Page 365 
 
 
 "CABI (2003) lists fruit (including pods), bark and stems (above-ground shoots, 
trunks and branches) as host plant parts that can carry spores and hyphae of the pathogen both internally and externally.  Ther efore, in addition to the fruit trade, the 
nursery, hardwood timber and mulch industries can also be involved in spread of the 
pest. Foliage is not affected (Butler, 1949) and leaf trash is unlikely to present a 
pathway unless twigs with active canker are present. 
Long-distance movement of European canker is primarily the result of movement of 
infected nursery stock. ... 
There is no evidence in the literature that  indicates that long-distance spread of 
disease is due to movement of fruit.  Conidi a and perithecia can develop in rotted or 
mummified fruit and contribute to local spread."
2176 
7.728  In the discussion of the potential for moveme nt with commodities or conveyances, the IRA 
again relies on unsupported assertions  regarding the possibility of the mummification of fruits that 
would then produce perithecia.2177  Additionally, in its discussion of the potential vectors of the pest, 
the IRA contains unsupported assumptions regarding the possible involvement of insects and birds as 
vectors in the spread of Neonectria galligena .2178  There is also no support in the IRA for the 
statement that "[p]eople (for example, consumer s, orchard and nursery workers) handling infected 
apples could potentially spread inoculum to susceptible host plants."2179 
Partial probability of establishment and spread  
7.729  Having discussed factors such as the suitability of  the natural and/or managed environment;  
the presence of natural barriers;  the potential for movement with commodities or conveyances;  the 
intended use of the commodity;  and the potential v ectors of the pest, the IRA estimates the partial 
probabilities of establishment and spread for spec ific exposure groups:  commercial fruit crops, 
establishment – uniform (0.7, 1), spread – unifo rm (0.7, 1);  nursery plants, establishment – 
uniform (0.7, 1), spread – uniform (0.7, 1);  household and garden plants, establishment – 
uniform (0.3, 0.7), spread – uniform (0.3, 0. 7);  wild and amenity plants, establishment – 
uniform (0.3, 0.7), spread – uniform (5 × 10-2, 0.3).2180 
Conclusions regarding exposure, establishment and spread  
7.730  The IRA combines in an @RISK model the partial probability estimate for importation, the 
estimated volume of apples and the partial probabi lity estimates for establishment and spread, to 
obtain an overall value for the annual probability of entry, establishment and spread (PEES).  The 
median simulated value for this probability of entr y, establishment and spread is estimated under the 
first scenario (if 70 to 100 per cent of imported a pples are distributed to orchard packing houses and 
the remainder to urban wholesalers) as (7.0 × 10-2) and under the second scenario (if 0.1 to 5 per cent 
of imported apples are distributed to orchard pack ing houses and the remainder to urban wholesalers) 
as (6.9 × 10-2), both corresponding to the qualitative description of "low".2181 
7.731  The Panel has already noted that the IRA's de rivation of the overall probability of importation 
of Neonectria galligena  by estimating and adding indivi dual probabilities for each importation 
                                                      
2176 Australia's IRA, Part B, p. 142. 
2177 Ibid. 
2178 Ibid. 
2179 Ibid. 
2180 Australia's IRA, Part B, pp. 142-144. 
2181 Australia's IRA, Part B, p. 145. WT/DS367/R 
Page 366  
 
 pathway is not supported and has not been validated by evidence.  Moreover, the Panel has found that 
the estimations of several of the likelihoods for individual importation pathways are not supported by 
scientific evidence or not based on a coherent and objective reasoning, and most likely overestimated.  
Additionally, any biases or overestimation in the calculation of the individual probabilities would be 
aggregated in the overall probability of importation. 
7.732  The Panel has also noted that, with respect to several aspects of its discussion on exposure, 
establishment and spread, the IRA's reasoning is not  coherent and objective or does not find proper 
support in scientific evidence.  This is notably the case for the IRA's assertions regarding the 
possibility that latently infected but symp tomless fruit could deve lop rot and generate Neonectria 
galligena  spores, which could then be transferred to  new hosts;  likewise with the propositions 
regarding the mummification of fruits and the possi bility that perithecia would play a role in the 
contamination of new hosts.  There is also no ev idence to support the IRA's seeming assumption that 
inoculum for infection and infection sites would be al ways available.  With respect to waste disposal, 
the IRA's assertion that consumer waste would pr esent "potential inoculum sources for transfer to 
susceptible host plants" is not supported by eviden ce.  The IRA does not contain scientific evidence 
that wind can serve as a dispersal mechanism for c onidia in the absence of rain.  The IRA's reasoning 
on the transfer mechanism is not objectively justifia ble as it fails to take into account that dispersion 
of conidia by rain splash would be very limited and,  in order to achieve transfer, would also require 
certain climatic conditions, which are unlikely to be  present in Australia, particularly during the most 
critical periods for infection.  There is no support in  the IRA for the suggested possibility that birds or 
insects could be involved as vectors in the transfer and spread of Neonectria galligena .  The IRA's 
discussion on the availability of entry points fails to  take into account that conidia are poor epiphytes 
and will not survive as a surface contaminant on a pple fruit.  The IRA also fails to adequately 
recognize the importance of the number of spores for th e likelihood of initiating an infection, or the 
role of other factors, such as the host cultivar.  Regarding host plant receptivity, the IRA exaggerates 
the susceptibility of leaf scars to serve as entry sites for conidia.  The IRA's reasoning regarding 
environmental factors is not objectively justifiable,  as it fails to take into account that the necessary 
climatic conditions for inoculum production, dissemina tion and infection, in terms of the appropriate 
combination of cool temperatures and wetness, are unlikely to be present in Australia, particularly 
during summer and early fall, the most critical peri ods for infection.  The IRA focuses on total annual 
rainfall, rather than on the more important factor s of hours of "leaf wetness" and whether rainfall 
occurs during critical periods.  There is also no s upport in the IRA for the statement that people (for 
example, consumers, orchard and nursery workers) handling infected apples could potentially spread 
inoculum to susceptible host plants. 
7.733  Dr Latorre notes that the reasoning provided in the IRA regarding the establishment and 
spread of European canker: 
"[I]s not entirely convincing because:  (i) Analysis of the climate conditions in the 
potential entrance areas is discussed only brie fly.  It should not be assumed that any 
area where the rainfalls are close to, or  exceed 1000 mm annually, are necessarily 
prone to European canker development.  Temperatures and rainfalls during the 
entrance periods (fruit-importing periods) shoul d be provided, considering that they 
will affect the likelihood of establishment and spread of N. galligena after entrance.  
Weather information for the entrance periods would allow experts to assess the 
probability that mature fruit carrying la tent infections will develop symptoms, 
sporulate, liberate the inoculum and spread it to  nearby hosts.  (ii) Injuries, leaf scars, 
pruning wounds, or other damages are necessary for infection, but leaf scars in the autumn are the most common sites of infection.  Fruit importation (and inoculum  WT/DS367/R 
 Page 367 
 
 
 availability) could occur when leaf scars are not present, reducing the probability of 
establishment and spread to zero."2182 
7.734  Dr Latorre adds that climatic conditions are a key point when assessing the risk of 
establishment and spread of Neonectria galligena  associated with asymptomatic apples from 
New Zealand.  "Climatic conditions in Australia's apple-producing regions must be suitable to disease 
establishment and spread, otherwise the likelihood of  establishment and spread would be zero and the 
risk analysis should end at this point."2183 
7.735  Regarding climatic conditions, Dr  Swinburne notes further that: 
"[Data on the basic weather conditions for in fection] will be relevant to all apple 
growing regions, but as they refer to just one aspect of the cycle of events, can not be 
used alone to predict the suitability of any region for the di sease.  The essential 
weakness of the approach in the IRA is that it assumes that inoculum (spores) for 
infection is always available, and all that is  required is a suitable period (hours of leaf 
wetness within given temperature limits) for infection to occur.  The major flaw in 
this argument is the assumption that regions can be compared on the basis of annual 
rainfall, without regard to rainfall pattern s.  Even in regions such as N. Ireland 
(Loughgall) with rain in all seasons, more  than 5hrs of leaf wetness was required 
following a few dry days before ascospore discharge resumed (Swinburne, 1971b).  The situation in regions with a pronounced  dry season, such as California and the 
Pacific Northwest in the USA, spore form ation does not even begin until some time 
(as yet undetermined) into the rainy period (Zeller, 1926, Wilson, 1966/8).  For such 
an area data relating only to simple 'infec tion periods' would greatly overestimate the 
risk of disease establishment."
2184 
7.736  Dr Swinburne adds that, because the initial establishment of an epidemic incited by 
Neonectria galligena  via imported infected fruit has not been  demonstrated, "the issue can only be 
addressed from a theoretical standpoint":2185 
"For such a pathway to exist fruit would not only have to develop visible rot, but also 
to form viable spores which can be distributed to new hosts.  The formation of perithecia on fruit has been observed very rarely (Dillon-Western, 1927), and does not feature in any subsequent epidemiological study (Swinburne, 1975;  CAB 2001).  It is therefore most unlikely that ascospor es would be formed or released from rotted 
fruit.  The formation of conidia on the surface of lesions does occur (Swinburne, 
1975) generally in the centre of the rotted ar ea where the cuticle h as split.  This is 
most obvious in fruit taken from stores in wh ich the humidity has been maintained at 
c. 100%.  Fruit which develop rots later w ithin the retail chain in conditions with 
lower [relative humidity] do not usually produce spores (personal observation) which 
                                                     
 
2182 Dr Latorre's reply to Panel question 58, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 364. 
2183 Dr Latorre's reply to Panel question 66, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 398. 
2184 Dr Swinburne's reply to Panel question 66, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 399.  See also, Dr Deckers's reply to Panel question 66, in List of Replies 
from the scientific experts to questions posed by the Panel, para. 397. 
2185 Dr Swinburne's reply to Panel question 58, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 365. WT/DS367/R 
Page 368  
 
 conforms with the observations (e.g. Wilson,  1966) for wood infections, that a period 
of 'leaf-wetness' is required for conidia formation."
2186 
7.737  Dr Swinburne adds further that the IRA fails  to note that the number of apples latently 
infected with Neonectria galligena  would be likely diminishing along the pathway chain, 
progressively reducing the likelihood of the estimated  events occurring.  The expert illustrates this 
with a hypothesis: 
"[I]f one had 100 infected apples that arrive d in Australia healthy, but became rotted 
subsequently, what would happen to those 100 infected apples?  Perhaps 70 or 80 of 
them would never develop spores anyway, so it could be disregarded.  Then you have 
to consider where the others might end up in  relation to the dispersal of inoculum.  In 
other words, all the processes are attenuating all the time down the chain and that is 
what I don't see coming through in the IRA at all.  The longer the apples are stored in 
New Zealand, the less is the likelih ood that an apple infected with Nectria  would be 
sent to Australia, because it would be culled out before it went into the retail-ready 
pack and went on the train.  So, the attenuation process after harvest would be 
continuous throughout the transport chain wh ich is not terribly well reflected in the 
IRA."2187 
7.738  Dr Swinburne concludes that "there is in fact no evidence in the literature that infected apples 
which rot with this fungus are responsible subse quently for the dissemination of the disease to other 
hosts, to further hosts":2188 
"Much of the evidence that has been pr esented concerns observations made in the 
1920s by Dillon-Western concerning a variety known as Worcester, which is an 
extremely early variety, which does rot on the tree and produces mummified fruits.  In the 40-odd years that I have worked on this, I never have had the privilege of 
seeing such a thing and I have attempted in the past to produce perithecia and 
ascospores from rotted apples for experiment al purposes and failed.  Fruit which rot 
with Nectria  as I will call it, does produce conidia if it is incubated under moist 
humid conditions to a limited extent in the centre of the lesion.  It is not a prolific source of spores for subsequent release a nd I fear that nobody has actually done the 
experiment of determining whether a ro tted apple can release spores into a new 
orchard situation and bring about disease.  It  is amenable to experimentation, along 
the lines of an experiment which we made in East Malling not too long ago with 
discarded canker wood which we pulverized and placed under potted trees of the 
most susceptible variety that I know, namely Spartan, and we failed to induce a single 
canker as a result of pulverizing several, maybe 50 kilos, of cankers underneath them."
2189 
7.739  Dr Swinburne adds that "there is no informa tion concerning the possibility" that an apple 
rotted with Neonectria galligena  discarded in an Australian orchar d would produce conidia and would 
have the ability to initiate a new series of in fections in an area which had never had it:2190 
                                                      
2186 Dr Swinburne's reply to Panel question 58, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 365 . 
2187 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 574. 
2188 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 411. 
2189 Ibid. 
2190 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 419.  WT/DS367/R 
 Page 369 
 
 
 "[F]ruit has to produce conidia in order to become an infectious unit.  It may be 
infected, but it is not necessarily infectious and even if it does become infectious, 
being presumably on the ground and not deliberately placed somewhere up in a tree, the dissemination of those conidia which depends on splash dispersal is actually going to be over a very limited area ... I wouldn't want to overemphasize that 
particular possibility but there is no inform ation which tells us that it cannot happen 
and as biologists one can never say it would never happen."
2191 
As explained by Dr Swinburne, although as a biolog ist he cannot rule out the possibility of infected 
fruit acting as a pathway for the long distance spr ead of European canker, "it probably has a 
vanishingly small probability."2192 
7.740  Dr Latorre noted that, despite the fact th at mature fruit can hold the pathogen and can 
certainly be moved from one place to the other, he agreed with Dr Swinburne's view: 
"The first step would be to have an infected fruit, and this is possible, without 
symptoms.  You can take this fruit and carry it from New Zealand, perhaps to Australia.  This is also possible, in my opini on.  But another question is that this fruit 
is going to be rotten in Australian conditions  and, secondly, another situation will be 
that that rotten fruit will produce spores, conidia, on the surface and, thirdly, that those conidia can be spread nearby, primarily  by rain splashing, which is the main 
dissemination way."
2193 
7.741  As noted by Dr Latorre, long-distance movement  of European canker is usually associated 
with the importation of nursery stock and not with  trade in apple fruit.  "There is no scientific 
evidence demonstrating that long-di stance spread of European canker is due to the movement of 
fruits. ... [L]ong-distance spread along with mature  apple fruits should be regarded as a hypothesis 
rather than a true fact."2194 
7.742  Dr Latorre stated further that: 
"[T]he only way that I can see how Australia can get European canker, really, is by 
the commercialization, international transpor tation of nursery plant material.  Perhaps 
this has been the way how this disease has been moved around the world.  I have seen 
no possibility that in reality fruit can really be the cause or be the introduction, establishment and spread of the disease in a new area.  You can introduce Nectria  on 
apples, but the other question is whether th is disease is going to be established in a 
location from the inoculum arriving on fruits."
2195 
7.743  Dr Latorre concludes that the overall value estim ated by the IRA for the annual probability of 
entry, establishment and spread for European ca nker leads to "non-credible" conclusions and would 
need to be validated before it can be accepted: 
                                                      
2191 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 419 . 
2192 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 422. 
2193 Dr Latorre's reply in Transcript of the Panel's meeting with experts, para. 424. 
2194 Dr Latorre's reply to Panel question 64, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 392.  See also, Dr Swinburne's reply to Panel question 64, in List of Replies from the 
scientific experts to questions posed by the Panel, para. 393. 
2195 Dr Latorre's reply in Transcript of the Panel's meeting with experts, para. 565.  See also, 
Dr Deckers's reply to Panel question 64, in List of Replies from the scientific experts to questions posed by the 
Panel, para. 390. WT/DS367/R 
Page 370  
 
 "[T]he overall probability of entrance, establishment and spread of N. galligena  was 
7.0 × 10
-2, which was rated as low (Table 37, AUS-2 BA p. 150).  Indeed, this a very 
high, rather than low, probability fo r any biological event associated with 
N. galligena .  If this likelihood value is true, and assuming that market penetration in 
Australia is equal to 50,000,000 a pples annually (AUS-2 BA, p. 19), N. galligena  
should be present in 3,500,000 apples (7%) annually, which is non-credible.  
Therefore, the overall probability (7.0 × 10-2) should be validated before acceptance.  
Data validating the probab ility values given in Tabl e 12 were not presented."2196 
7.744  In conclusion, throughout the discussion of the di fferent factors, the IRA tends to exaggerate 
the risk, for example, by not taking into account that any epyphitical fungal populations would likely 
be small and diminishing and that the number of la tently infected apples would also diminish over 
time, by not considering the climatic conditions  that are necessary for inoculum production, 
dissemination and infection, and by assuming that inoc ulum for infection and infection sites would be 
always available.  The IRA instead emphasizes a nu mber of factors and assumes some hypotheses that 
would tend to increase the likelihood of entry, est ablishment and spread, despite the absence of 
adequate scientific evidence to support these factors or  even in the face of available evidence to the 
contrary. 
7.745  Little information is provided in the IRA on how the extensive discussion and review of 
different factors associated with the entry, estab lishment and spread, is then translated into 
quantitative estimates.  The Panel cannot attempt to  recalculate these estimates, as this would 
constitute a de novo  review exercise.  It cannot fail to note, however, that these estimations do not find 
support in the available scientific evidence or in a coherent and objective reasoning.  In this respect, 
the Panel finds puzzling that, under two, widely-d ifferent scenarios regarding proximity, the IRA 
reaches relatively similar conclusions on the probabili ty of entry, establishment and spread.  As noted 
above, the IRA considers a first scenario, under which 70 to 100 per cent of imported apples are 
distributed to orchard packing houses and the rema inder to urban wholesalers, and a second scenario, 
under which only 0.1 to 5 per cent of imported apples are distributed to orchard packing houses.  The 
IRA, however, reaches broadly similar conclusions , corresponding to the qualitative description of 
"low", and estimates almost identical probability values under both scenarios.2197 
7.746  The Panel has already recognized that, in co nducting risk assessments, Members frequently 
confront limitations in the availability of the data necessary for their models.2198  The Panel has noted 
that, when facing this problem, Members may try to es timate the answers if there is no data available, 
through the use of expert judgement.  Indeed, Aust ralia argues that this is how probabilities were 
estimated for several steps.2199  In this respect, the Panel has noted that, while expert judgement may 
be an important tool for the risk assessor, it cannot  replace the necessary scientific data, especially for 
the purpose of estimating the likelihood of entry, establishment and spread of  a pest.  In accordance 
with the relevant ISPMs, recourse to expert judgeme nt does not substitute for the use of the available 
information.  The use of expert judgement must be  documented and transparent;  it must be based on 
the relevant reliable scientif ic information, even when that information is limited.2200  As noted by one 
                                                      
2196 Dr Latorre's reply to Panel guideline (g), in List of Replies from the scientific experts to questions 
posed by the Panel, para. 5. 
2197 Australia's IRA, Part B, p. 145.  Dr Sgrillo's re ply to Panel question 46, in List of Replies from the 
scientific experts to questions posed by the Panel, paras. 296-297;  Dr Sgrillo's reply in Transcript of the Panel's 
meeting with experts, para. 40.  See also, Dr Cross's reply in Transcript of the Panel's meeting with experts, 
para. 42. 
2198 Dr Sgrillo's reply in Transcript of the Panel's meeting with experts, para. 191. 
2199 See, for example, Australia's first written submi ssion, paras. 541, 547, 563, 568, 580, 594, 598, 
601, 638, 649, 689 and 719;  Australia's second written submission, paras. 467 and 520.  See also, Australia's 
opening oral statement at the seco nd substantive meeting of the Pa nel with the Parties, para. 12. 
2200 See paras. 7.433-7.440 above.  WT/DS367/R 
 Page 371 
 
 
 of the experts, if there is no data  available, Members should try to re fer to other available information, 
for example to other pests, where there may be some data.2201  Non-compliance with these 
requirements, may produce errors in the exercise of e xpert judgement.  It is not enough to claim, as 
Australia has done, that "[t]he IRA Team applied its  expert judgment and elaborated its reasoning at 
every step in the Final IRA Report".2202 
7.747  In the light of the above, the Panel finds that  New Zealand has not made a prima facie case 
that the IRA's discussion on utility points and estimated proximity ratings for the combination of each utility point with exposure groups (proximity values)  for European canker, does not rely on adequate 
scientific evidence or is not coherent and objective. 
7.748  The Panel finds, however, that the IRA's estimation that fruit coming out from an infected or 
infested orchard is infected or infested with Neonectria galligena  (importation step 2);  that clean fruit 
from infected or infested orchards is contaminated with Neonectria galligena  during picking and 
transport to the packing house (importation step 3);  th at infected or infested fruit remains infected or 
infested after routine processing procedures in the p acking house (importation step 4);  that clean fruit 
is contaminated by Neonectria galligena  during processing in the packing house (importation step 5);  
that infected or infested fruit remains infected or infested during palletization, quality inspection, 
containerization and transportation to Australia (importation step 6);  and that clean fruit is 
contaminated by Neonectria galligena  during palletization, quality in spection, containerization and 
transportation (importation step 7);  do not find suff icient support in the scientific evidence relied 
upon and, accordingly, are not coherent and objective.   In the light of the these findings and in the 
absence of any separate justification and eviden ce in the IRA regarding the estimated overall 
likelihood of importation, the Panel finds additi onally that the IRA's estimation of the overall 
probability of importation is not supported by adeq uate scientific evidence a nd, accordingly, is not 
coherent and objective. 
7.749  The Panel also notes that a significant pa rt of the IRA's discussions on exposure, 
establishment and spread of European canker, r ests on a number of assumptions and qualifications.  
This leads to reasonable doubts about the evaluatio n made by the risk assessor.  The IRA has not 
properly considered a number of factors that coul d have a major impact on the assessment of this 
particular risk.  Accordingly, the Panel finds that  the reasoning articulated in Australia's IRA, with 
respect to the likelihood of entry, establishment a nd spread of European canker, including the IRA's 
estimation of the value for the respective probabiliti es, does not rely on adequate scientific evidence 
and, accordingly, is not coherent and objective. 
(k) Potential biological and economic conse quences associated with European canker 
(i) Summary of the Parties' arguments 
7.750  New Zealand argues that Australia's analysis of the consequences of European canker does 
not constitute an evaluation of the "associated pot ential biological and economic consequences" of the 
disease within the meaning of the SPS Agreement.  In  its view, "the IRA's assessment of the overall 
consequences as moderate is a significant overestimation."
2203 
7.751  New Zealand argues that the IRA's rating of "E" for the direct impact of European canker on 
plant life or health is "a significant overestim ate", because the IRA exaggerates the risk of 
                                                      
2201 Dr Schrader's reply in Transcript of the Panel's meeting with experts, para. 195. 
2202 Australia's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 16.  See also, Australia's first wr itten submission, paras. 74, 218 and 239. 
2203 New Zealand's first written submission, para. 4. 332.  See also, New Z ealand's second written 
submission, paras. 2.662 and 2.685. WT/DS367/R 
Page 372  
 
 establishment or spread of European canker in Australia.
2204  In New Zealand's view, because of the 
Australian climate conditions, "the direct impact of European canker on plant life or health in 
Australia would be at most minor, even at the local level."2205 
7.752  New Zealand also disputes the IRA's analysis of  the direct impact of European canker on 
other aspects of environmental effects.  In New Z ealand's view, the IRA's analysis of the Tasmanian 
outbreak in this regard is flawed.  New Zealand ar gues that "there are few areas in Australia where 
European canker could establish and spread".2206 
7.753  New Zealand also argues that the IRA's analysis  of the indirect impact of European canker 
"exaggerates the predicted overa ll effect that European ca nker would have on Australia".2207  
According to New Zealand, " N. galligena  is not known worldwide to cause damaging diseases of 
amenity plants."2208  As regards control or eradication, New Zealand submits that "any outbreak is 
likely to be highly localised [and c]onsequently, the costs of eradication are not likely to be high".2209  
Regarding international trade, New Zealand notes that its experience is that "the presence of 
N. galligena  has not constrained its trade in appl es, with countries other than Australia".2210  Finally, 
New Zealand submits that European canker's "impact on the environment and communities is 
negligible".2211  New Zealand argues, in particular, that "t here is no basis for the IRA's suggestion that 
European canker disease ... could have i ndirect flow-on effects for tourism".2212 
7.754  In response, Australia argues that the IRA' s analysis of the potential consequences of 
European canker is objective and credible.  Austra lia submits that, despite its allegations about 
"exaggeration" and "significant ove restimation", New Zealand did not  seriously address the issues 
raised in the discussion on consequences contained in the IRA and failed to establish any flaws with 
the assessment of consequences.2213 
7.755  Australia rejects New Zealand's allegation on the analysis for the direct impact of European 
canker on plant life or health.  Australia submits "t hat the rating assigned to this criterion by the IRA 
Team was credible."2214  Australia argues that the IRA's analysis  contains "a credible evaluation of the 
likelihood of the establishment or  spread of European canker".2215  The IRA notes that climatic 
conditions in approximately 40 per cent of Aust ralian commercial fruit growing areas are conducive 
to infection and that certain Australian regions have  annual mean rainfalls greater than 1000 mm or 
close to that amount.2216  In Australia's view, New Zealand's climate analysis "is too narrow to 
accurately predict the establishment of European canker ... [T]he potential distribution of European 
                                                      
2204 New Zealand's first writte n submission, para. 4.326. 
2205 New Zealand's first written submission, para. 4. 327.  See also, New Z ealand's second written 
submission, paras. 2.665-2.666. 
2206 New Zealand's first written submission, paras. 4.328-4.329.  See also, New Zealand's second 
written submission, paras. 2.675-2.676. 
2207 New Zealand's first writte n submission, para. 4.330. 
2208 Ibid. 
2209 New Zealand's first written submission, para. 4. 331.  See also, New Z ealand's second written 
submission, para. 2.678. 
2210 New Zealand's first written submission, para. 4. 332.  See also, New Z ealand's second written 
submission, para. 2.682. 
2211 New Zealand's first written submission, para. 4. 332.  See also, New Z ealand's second written 
submission, para. 2.684. 
2212 New Zealand's first writte n submission, para. 4.332. 
2213 Australia's first written submission, paras. 673 and 718.  See also, Australia's second written 
submission, para. 590. 
2214 Australia's first written submission, para. 686. 
2215 Australia's first written submission, para. 679. 
2216 Australia's first written submission, para. 678.  WT/DS367/R 
 Page 373 
 
 
 canker in Australia covers a much larger area th an suggested by New Zealand's climate analysis, 
showing that the direct impact of European canker on plant life or health in Australia would be more 
than 'minor', even at the local level."2217  Australia argues further that  the IRA's examples, regarding 
the impact to plant life or health do not relate onl y to Europe and North America, where some popular 
varieties are similar to those grown in Australia a nd New Zealand, but also includes material dealing 
with both Tasmania and New Zealand "which i ndicates that the disease, where established, has 
serious consequences ... In any event, give n that Australia is currently free from N. galligena , in 
assessing consequences the IRA Team had no option but  to draw on the experiences of other countries 
with the disease."2218  Australia argues that recent reports coming out of New Zealand support the 
IRA's rating of the direct impact of Neonectria galligena  on plant life or health.2219  Finally, Australia 
submits that New Zealand ignores the fact that the IRA considered that there were a large number of 
other host species of Neonectria galligena , in addition to apples and pears.2220 
7.756  Australia also rejects New Zealand's allegation on the analysis of the direct impact of 
European canker on other aspects of the environmen t.  Australia argues that the rating assigned by the 
IRA to this criterion was credible.2221  In this respect, Australia agai n argues that the IRA's analysis 
contains "a credible evaluation of the likelihood of  the establishment or spread of European canker" 
and that, given that Australia is free from Neonectria galligena , the IRA team had to consider studies 
from other countries with the disease, exercising its e xpert judgement in order to take into account 
differences in the circumstances be tween Australia and other countries, including on climate and 
flora.2222  Australia rejects New Zealand's allegation th at the IRA ignored the actual experience from 
the Tasmanian European canker outbreak.  In Austra lia's view, "[i]t is disingenuous ... to argue that 
this rigorous eradication program was somehow irre levant to restricting the spread of the disease."2223  
Australia additionally submits that "[t]he limited spread of N. galligena  in Tasmania was also assisted 
by the absence of airborne ascospores which are bette r suited to long-distance dispersal than conidia."  
Even in the absence of ascospores, limited spread among apple trees w ithin and between orchards in 
Tasmania occurred through rain splashed conidia.  However, because "[t]he  New Zealand strain of N. 
galligena  produces ascospores ... if it established in Aust ralia the impact would be much more severe 
than in Tasmania."  Australia also suggests that "the Tasmanian outbreak was likely to have involved 
an unique strain of N. galligena  that required another mating type for reproduction."2224  A u s t r a l i a  
rejects New Zealand's assertion that N. galligena  does not impact on amenity plants.  Australia 
suggests that the "[e]vidence shows that the diseas e causes considerable damage to trees in private 
gardens in New Zealand" and that "it is well accepte d that common hosts of the fungus include maple, 
birch, beech, ash, oak, willow and elm trees", many  of which are amenity plants in Australia.2225 
7.757  Regarding the IRA's analysis of the indirect impact on control and eradication, Australia 
rejects New Zealand's arguments and submits that the IRA's rating is credible.2226  Australia again 
suggests that New Zealand's climate analysis is  "too narrow" and "the potential distribution of 
European canker in Australia covers a much larger area than suggested by New Zealand".2227  
                                                      
2217 Australia's first written submission, para. 681.  See also, Australia's second written submission, 
paras. 575-577. 
2218 Australia's first written submission, paras. 682-683.  See also, Australia's second written 
submission, paras. 578-580. 
2219 Australia's first written submission, para. 684. 
2220 Australia's first written submission, para. 685. 
2221 Australia's first written submission, para. 694. 
2222 Australia's first written submission, para. 689. 
2223 Australia's first written submission, para. 690.  See also, Australia's second written submission, 
paras. 581-582. 
2224 Australia's first written submissi on, para. 691 (footnotes omitted). 
2225 Australia's first written submission, para. 693. 
2226 Australia's first written submission, para. 702. 
2227 Australia's first written submission, para. 698. WT/DS367/R 
Page 374  
 
 Australia rejects "New Zealand's attempt to downplay the costs of eradication".  In its view, 
"European canker is both difficult and expensive to eradicate once established."  Implementing 
general control methods for European canker, such as  fungicide sprays, paints  applied to pruning cuts, 
cultural control, improving host plant resistance and the prevention of fruit rot, would be costly.
2228  
Although the IRA acknowledges that cultural practices and chemical measures used to control apple 
scab in most Australian apple growing regions wo uld assist in controlling European canker, spray 
treatments alone cannot eradicate ex isting infections and must be s upplemented by removing cankers 
and treating wounds with an effective paint.2229  In Australia's view, the Tasmanian outbreak 
illustrates the appropriateness of the IRA's rating for the indirect impact of control and eradication.2230 
7.758  Australia rejects New Zealand's arguments regard ing the IRA's analysis on the indirect impact 
on international trade.  Australia submits that  New Zealand presupposes that Australia's export 
markets are the same as New Zealand's, which already have European canker.2231  In any event, 
Australia notes that the IRA considered that Euro pean canker would only have "a minor impact on 
international trade at local level ... [and] the impact  at the national level was assessed as unlikely to be 
discernable."2232 
7.759  Regarding the IRA's analysis on the indirect impact on the environment and on communities, 
Australia rejects New Zealand's arguments and submits that the IRA's rating is credible.2233  Australia 
submits that New Zealand's reference to a "n egligible" impact on the environment and on 
communities would be other examples of New Zeala nd attempting to conduct its own risk assessment 
according to its own methodology.2234  Australia argues that the Tasmanian outbreak experience 
illustrates the IRA's proposition that establishment of Neonectria galligena  in Australia could 
necessitate increased chemical usag e that may have undesirable effects on the local environment as 
well as a significant impact on the future placement of plant species.2235  Regarding communities, the 
Tasmanian outbreak also illustrates the effects of  quarantining of the area, the effects on the 
livelihood of local people, and the effects on tourism.2236  Finally, Australia rejects New Zealand's 
arguments dismissing the IRA's analysis regarding the indirect impact of European Canker 
establishment on tourism.  Australia argues that th e the elm tree population in gardens and parks of 
Melbourne are likely to be important to tourism.2237 
(ii) The Panel's analysis 
7.760  The assessment in the IRA of the potential biological and economic consequences associated 
with European canker is based on the consideration of  a number of direct and indirect criteria.  The 
direct criteria include:  plant life or health, hum an life or health and any other aspects of the 
environment.  The indirect criteria include:  control or eradication, domestic trade or industry, 
international trade, environment and communities.  The IRA allocates impact scores for each direct 
and indirect criterion.  The impact scores are from the least significant "A" to the most significant "G". 
                                                     
 
2228 Australia's first written submission, para. 699. 
2229 Australia's first written submission, para. 700. 
2230 Australia's first written submission, para. 701. 
2231 Australia's first written submission, para. 705.  See also, Australia's second written submission, 
para. 583. 
2232 Australia's second written submission, paras. 584-585. 
2233 Australia's first written submission, paras. 710 and 717. 
2234 Australia's first written submission, paras. 708 and 713. 
2235 Australia's first written submission, para. 709. 
2236 Australia's first written submission, para. 715. 
2237 Australia's first written submission, para. 716.  See also, Australia's second written submission, 
paras. 586-588.  WT/DS367/R 
 Page 375 
 
 
 7.761  Regarding the direct criteria .  On plant life or health, the IRA allocates an impact score 
of "E".  The IRA considers the consequences of Eur opean canker affecting plant life or health to be 
minor at a national level, significant at a regional level and highly significant at a district level.2238  On 
human life or health, the IRA allocates an impact sco re of "A".  The IRA considers the consequences 
of European canker on human life or health to be un likely to be discernable at local level;  it notes that 
"[t]here are no known direct impacts of N. galligena  on human life or health".2239  On any other 
aspects of the environment, the IRA allocates an imp act score of "D".  The IRA considers the direct 
consequences of European canker on the environmen t to be unlikely to be discernable at a national 
level, of minor significance at a regional level, but significant at a district level and highly significant locally.
2240 
7.762  Regarding the indirect criteria .  On control and eradication, the IRA allocates an impact score 
of "D".  The IRA considers that the costs of c ontrol and eradication of an outbreak of European 
canker would be unlikely to be discernable at a na tional level and of minor significance at a regional 
level, but significant at a district level and highly significant locally.2241  On domestic trade or 
industry, the IRA allocates an impact score of "D".   The IRA considers that the indirect impact of 
European canker on domestic trade would be unlikel y to be discernable at a national level and of 
minor significance at a regional level, but significant at a district level and highly significant locally.
2242  On international trade, the IRA allocates an impact score of "B".  The IRA considers that 
the indirect consequences of European canker on in ternational trade would not be discernible at a 
national level and would be of mi nor significance at a regional level.2243  On the environment, the IRA 
allocates an impact score of "C".  The IRA notes th at any indirect consequences of European canker 
on the environment are unlikely to be discernible at  the regional level, of minor significance at a 
district and significant at a local level.2244  On communities, the IRA allocates an impact score of "C".  
The IRA considers that the indirect conseque nces of European canker on communities would be 
unlikely to be discernible at a regional level, of minor significance at a district level and significant at the local level.
2245 
7.763  Considering these impact scores, the IRA concludes that the overall potential biological and 
economic consequences should be rated as "moderate".2246 
7.764  Furthermore, by combining the value for the annual probability of entry, establishment and 
spread and the outcome of overall consequences, th e IRA estimates that the unrestricted annual risk 
for imported apples from New Zealand is "low".  Th e rating of "low" unrestricted annual risk is the 
same under the two different scenarios considered by the IRA.  As noted above, the IRA considers a 
first scenario, under which 70 to 100 per cent of impo rted apples are distributed to orchard packing 
houses and the remainder to urban wholesalers, a nd a second scenario, under which only 0.1 to 5 per 
cent of imported apples are distributed to orchard packing houses.  This rating of "low" is above Australia's ALOP of "very low".  Accordingly, th e IRA concludes that "risk management would be 
required for this pest".
2247 
7.765  The experts consulted by the Panel are sceptical  about the impact scores assigned by the IRA 
to some criteria.  Dr Latorre, for example, noted that  "[o]n the basis of reports in the literature and the 
                                                      
2238 Australia's IRA, Part B, pp. 146-147. 
2239 Australia's IRA, Part B, p. 147. 
2240 Australia's IRA, Part B, pp. 147-148. 
2241 Australia's IRA, Part B, p. 148. 
2242 Australia's IRA, Part B, p. 149. 
2243 Ibid. 
2244 Ibid. 
2245 Australia's IRA, Part B, p. 150. 
2246 Ibid. 
2247 Ibid. WT/DS367/R 
Page 376  
 
 experience of other apple-producing countries, the conc lusion arrived at by the IRA with regard to the 
overall consequence rating (E, moderate) is overestimated."
2248  Dr Latorre added that: 
"[B]ased on the general overall information in the world, in my opinion European 
canker is an important disease, but it is not a limiting factor for apple production, nor is it a limiting factor for commercialization outside Australia.  At least this hasn't 
been the situation that I can speak of, in the Chilean production.  We do have this 
problem in part of the country, that farm ers can really address, and so far as I know, it 
has never been a real problem or been a reason for not to commercialize the fruit 
properly, adequately, in most of the interna tional or local markets.  In this regard, I 
tend to disagree with the moderate conclu sion on consequence that [the IRA has] 
arrived at."
2249 
7.766  Dr Swinburne concurred and noted that: 
"The overall consequence rating of 'E' (m oderate) can only be justified if the 
assumption that climatic conditions in th e fruit producing regions of mainland 
Australia are conducive to the rapid spread  of canker from a point source (discarded 
rotted apples) across a district.  As discussed in Q58 & Q66, and in the light of the 
limited spread experienced in Tasmania, it seems unlikely that this could occur."2250 
7.767  Dr Swinburne concluded further that: 
"Based on the observation of where [Australia's] fruit growing regions are, taken 
from [Australia's] submission, and noting that  [they lie] within the band with less than 
a 100 days rainfall on average per year and perhaps nearer to 50.  I think the 
consequences of an infection event within  [Australia's] fruit industry would not have 
as large a damaging effect as [the IRA] had claimed."2251 
7.768  Regarding some of the evidence submitted by Australia, regarding the consequences of 
European canker, Dr Latorre noted that plant pa thologists may tend to overemphasize the importance 
of some plant diseases: 
"[P]lant pathologists ... tend to consider their work as the most important and most 
serious of anything in the world.  In doing so, we tend to over emphasise the importance of some diseases.  I think I make myself that mistake too, sometimes.  In reality, diseases are very important, this is true.  The question is, is this a limiting 
factor by which the farmers or the count ry cannot produce a certain commodity?  
Speaking on European canker, this is not the case.  It has not been the case in any 
place in the world where this disease has arrived, as far as I know. ... So, I am not 
surprised about the comments in Annex 3 [of Australia's rebuttal submission].  If you 
look in the literature, normally [European canker] is called 'a major disease of 
apple".
2252 
                                                      
2248 Dr Latorre's reply to Panel question 60, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 372. 
2249 Dr Latorre's reply in Transcript of the Panel's meeting with experts, para. 562. 
2250 Dr Swinburne's reply to Panel question 60, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 373.  See also, Dr Deckers's reply to Panel question 60, in List of Replies 
from the scientific experts to questions posed by the Panel, para. 371. 
2251 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 560. 
2252 Dr Latorre's reply in Transcript of the Panel's meeting with experts, para. 565.  WT/DS367/R 
 Page 377 
 
 
 7.769  Regarding the IRA's analysis on the direct consequences of European canker on plant life or 
health, Dr Latorre added that "European canker ha s been considered as a major disease of apples, 
proving economically important in Chile (Latorre et al., 2002), primarily because 2-3 fungicide applications are necessary each year to pr event infections through leaf scars."
2253  However, he noted 
that European canker has never limited Chilean  commercial production, although yields can be 
reduced and production cost increased.2254 
7.770  Dr Latorre noted the IRA's assertion that "[c]limatic conditions in approximately 40% of 
Australian commercial fruit growing areas are conducive to infection."2255  Dr Latorre pointed out that 
this conclusion "was only based on an nual rainfalls, without any analysis of the climatic conditions 
during the critical period (e.g., leaf fall in autumn ) with regard to the host trees for infection."2256 
7.771  With respect to the IRA's assertion that "[t]he  main economic impact of the disease results 
from destruction and removal of individual trees or  whole orchards because of girdling of branches, 
which can significantly reduce crop production yields"2257, Dr Latorre notes that "[r]emoval of whole 
orchards of bearing trees is extremely rare, if it ever happens.  Removal of some young trees may occur."
2258 
7.772  Dr Latorre also noted the IRA's assertion that "[ f]ruit rot generally develops in the field or 
before harvest, although storage losses of 10–60% of  the stored fruit crop have been reported in 
various parts of the world".2259  In this respect, he explained that: 
"In rainy areas at harvest, storage losses are commonly below approximately 2%.  In 
areas free of summer rains at harvest, storage losses are 0%.  Storage losses of 10-60% may occur in highly susceptible apple va rieties that are inadequately managed 
(without fungicide treatments under poor cold-storage conditions), a phenomenon 
that has been observed only in areas with  extremely favourable environments and 
under high inoculum pressure."
2260 
7.773  Dr Latorre concluded that, "[b]ased on the know ledge of European canker, and according to 
the general experience observed in other apple expor ting countries where European canker is present, 
considering the consequences impact as 'E' is not credible".2261  In his view, "the 'E' score is unreal 
because it is unlikely that losses can be sev ere at the district or local level."2262  The economic effects 
of European canker, in terms of increased costs of winter pruning, fungicide treatments and the 
                                                      
2253 Dr Latorre's reply to Panel question 60, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 372.  See also, Dr Latorre's reply to Panel question 86, in List of Replies from the 
scientific experts to questions posed by the Panel, para. 502. 
2254 Dr Latorre's reply to Panel question 60, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 372. 
2255 Australia's IRA, Part B, p. 146. 
2256 Dr Latorre's reply to Panel question 60, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 372.  See also, Dr Deckers's reply to Panel question 86, in List of Replies from the 
scientific experts to questions posed by the Panel, para. 500. 
2257 Australia's IRA, Part B, p. 146. 
2258 Dr Latorre's reply to Panel question 60, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 372. 
2259 Australia's IRA, Part B, p. 146. 
2260 Dr Latorre's reply to Panel question 60, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 372.  See also, Dr Latorre's reply to Panel question 86, in List of Replies from the scientific experts to questions posed by the Panel, para. 502. 
2261 Dr Latorre's reply to Panel question 86, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 502. 
2262 Dr Latorre's reply to Panel question 86, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 503. WT/DS367/R 
Page 378  
 
 removal of stem lesions and infected branches, and fruit yield reduction, can be absorbed by farmers 
with no major consequences to the farmer or to th e local apple industry.  Moreover, those economic 
effects can be reversible at local level, rather th an permanent.  While disease severity can be high at a 
tree level, disease prevalence and disease incidence ar e commonly far less than 100 per cent.  Finally, 
"[e]ven under highly-prone environm ental conditions, disease progress rate would be low rather than 
high."
2263 
7.774  Regarding the IRA's analysis on the indirect consequences of European canker on control or 
eradication, Dr Latorre added that the rating of "D" assigned by the IRA: 
"[A]ppears to be too high considering:  (i). Control of European canker would be 
unlikely to be too high, physically and econom ically  (ii). Control strategies for other 
apple diseases (e.g., apple scab, powdery mild ew) would help to control European 
canker.  (iii). The rate of disease progress is commonly low, which implies that eventual outbreaks of European canker mu st be localized, facilitating control and 
eradication.  (iv) The presence of European canker has no effect on apple trade internationally, except with Australia.  Thus , eradication of eventual European canker 
outbreaks would not affect the international trade."
2264 
7.775  Referring to Australia's argument on the Tasman ian outbreak illustrating the appropriateness 
of the IRA's rating for the indirect impact of control and eradication, Dr Swinburne noted that: 
"[Australia] had an enormous difficulty in getting rid of [the disease], in spite of 
constant pruning and cutting, and so fort h.  Even though [there was] no inoculum, 
there was no spore production.  What I should have said ... is that that infection was 
imported with the trees that [were] planted on that occasion.  Those trees were almost 
certainly infected when they put were in the ground.  The desp erate difficulty that 
[Australia] had in getting rid of it from those individual trees was because it was 
semi-systemic infection.  In fact, the infection was moving through the tree inside.  Although you cut off a canker there, you were astonished to find another one 
appearing on a branch over there.  But it had not spread from there to there directly, it 
had gone the other way, it had gone, as we now recognise, semi-systemic infection 
and that clean planting material is crucial to the prevention of canker.  So long as you 
keep Australia's quarantine system going for new cultivars or new root stocks and make sure that the nurseries that produce the commercial trees are screened 
absolutely, I don't think Australia will have a particular problem from canker 
spreading by the airborne route."
2265 
7.776  It is not the Panel's role to reassess the imp act scores assigned by the IRA to specific criteria 
and propose different scores.  In any event, it must  be noted that, according to the experts consulted 
by the Panel, the IRA has a tendency to overestim ate the severity of the consequences of European 
canker in certain aspects.  This overestimation affect s in particular two of the scores that in the IRA 
are assigned the more severe scores of "E" and "D" (plant life or health, control or eradication and 
domestic trade or industry). 
                                                      
2263 Dr Latorre's reply to Panel question 86, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 502. 
2264 Dr Latorre's reply to Panel question 87, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 505. 
2265 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 563.  WT/DS367/R 
 Page 379 
 
 
 7.777  In the light of the above, the Panel concludes that the IRA's evaluation of the potential 
consequences associated with the entry, establishment or spread of  European canker into Australia 
does not rely on adequate scientific evidence and,  accordingly, is not coherent and objective. 
(l) Overall conclusions with respect to th e requirements regarding European canker 
7.778  For the reasons stated above, the Panel finds that, with respect to its analysis of the likelihood 
of entry, establishment and spread of European can ker, and of the potential consequences associated 
with the entry, establishment or spread of Europ ean canker into Australia, Australia's IRA is not a 
proper risk assessment within the meaning of Ar ticle 5.1 and paragraph 4 of Annex A of the 
SPS Agreement.  The flaws described above also cons titute a failure by the IRA to take sufficiently 
into account factors such as the available scientific evidence, th e relevant processes and production 
methods in New Zealand and Australia, and the actua l prevalence of European canker, as required by 
Article 5.2 of the SPS Agreement. 
7.779  Accordingly, Australia's requirements regard ing European canker on New Zealand apples are 
inconsistent with Articles 5.1 and 5.2 of the SPS Ag reement.  Since the requirements are not based on 
a risk assessment as provided in Article 5.1 of the SPS Agreement, these measures can be presumed, 
more generally, not to be ba sed on scientific principles within the meaning of Article 2.2.2266  
Accordingly, the Panel finds that Australia 's requirements regarding European canker on 
New Zealand apples are, by implication, also inc onsistent with Article 2.2 of the SPS Agreement". 
(m) Methodological flaws identified by New Zealand 
7.780  The Panel has already found that the IRA's c hoice of probability interval and midpoint for 
events with a "negligible" likelihood of occurri ng, as well as the combination of this probability 
interval with the use of a uniform distribution to  model the likelihood of these events, are not properly 
justified in the IRA and lead to an overestimation of the probability of entry, establishment and spread 
of the pests at issue.  The Panel found that, because of these methodologi cal flaws, Australia's 
requirements regarding fire blight on New Zealand ap ples are inconsistent with  Articles 5.1, 5.2 and 
2.2 of the SPS Agreement. 
7.781  Because the methodological flaws also affect Australia's requirements regarding European 
canker, there is no need for the Panel to make a separate determination in this regard for these 
requirements.  Accordingly, the Panel finds that, with respect to the methodological flaws described 
above, Australia's requirements regarding European  canker on New Zealand apples are inconsistent 
with Articles 5.1, 5.2 and 2.2 of the SPS Agreement. 
6. Requirements regarding ALCM 
7.782  As with other pests, the IRA contains a section describing the biology of ALCM, a 
description of the risk scenario, a discussion of the likelihood of entry, establishment and spread of 
ALCM, an assessment of the consequences, a descri ption of the unrestricted risk and, finally, a 
discussion of risk management measures.2267 
7.783  New Zealand has challenged Australia's inspection and treatment requirements regarding 
apple leafcurling midge on New Zealand apples.  As described in New Zealand's panel request, these 
requirements include the following options: 
                                                      
2266 Appellate Body Report on Australia – Salmon , paras. 137-138. 
2267 Australia's IRA, Part B, pp. 157-192. WT/DS367/R 
Page 380  
 
 "[T]he option of inspection of each lot on the basis of a 3000 unit sample selected at 
random across the whole lot for apple leafcu rling midge, symptoms of quarantineable 
diseases, quarantineable pests, arthropods, tr ash and weed seeds, with detection of 
any live quarantineable arthropod resulting in  appropriate treatment or rejection for 
export; 
[T]he option of 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, plus mandatory appropriate treatment of all lots."
2268 
7.784  New Zealand argues that Australia has failed to  evaluate the likelihood of entry of ALCM.  
With respect to the IRA's analysis of the probabilit y of importation, New Zealand argues that "there is 
frequently no objective and rational relationship [in th e IRA] between the scientific evidence that is 
cited for a step and the probability value that is c hosen.  Indeed, frequently a value is chosen in the 
absence of sufficient scientific support."2269 
7.785  New Zealand also argues that Australia has "faile d to evaluate the likelihood of 'establishment 
or spread' of the disease."2270 
7.786  New Zealand also adds that "[the IRA's] pur ported analysis of the 'associated potential 
biological and economic conse quences' of ALCM constitutes nothing more than a listing of 
unsubstantiated assumptions.  It is not an evaluation of those consequences within the meaning of the 
SPS Agreement ."2271 
7.787  In New Zealand's view, there is "no eviden ce that the consequences foreseen by the IRA 
would occur."2272 
7.788  The Panel will analyze this requirement regard ing apple leafcurling midge under Articles 5.1 
and 5.2 of the SPS Agreement by focusing on the specific alleged flaws in the IRA identified by 
New Zealand in its various submissions.  The Pane l will consider whether New Zealand has properly 
made the case that: 
(a) In assessing the likelihood of ALCM entry and establishment, the IRA did not 
properly take into account the proportion of cocoons with viable ALCM; 
(b) In assessing the viability of ALCM inside occupied cocoons, the IRA did not 
properly take into account the possible ef fect of parasitism caused by the wasp 
Platygaster demades ; 
(c) The IRA's evaluation of the establishment and spread of ALCM is based on incorrect 
assumptions regarding the flight range of ALCM; 
(d) The IRA's evaluation of the establishment and spread of ALCM is based on incorrect 
assumptions regarding the period that would be needed for ALCM to emerge after the apples have been removed from cold storage; 
                                                     
 
2268 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A-1 to this report, p.  2.  See also, Australia's IRA, Part B, pp. 188-192. 
2269 New Zealand's first written subm ission, paras.  4.334-4.335. 
2270 New Zealand's first writte n submission, para. 4.350. 
2271 New Zealand's first writte n submission, para. 4.377. 
2272 New Zealand's first writte n submission, para. 4.373.  WT/DS367/R 
 Page 381 
 
 
 (e) The IRA did not properly take into account the climatic conditions that are necessary 
for the establishment and spread of ALCM; 
(f) The IRA is based on wrong assumptions regarding the mode of trade of New Zealand 
apples imported into Australia;  and, 
(g) The IRA fails to properly evaluate  the potential biological and economic 
consequences associated with the pest. 
7.789  The Panel will conduct this review by consideri ng the arguments raised by New Zealand in 
the context of the IRA's analysis on ALCM.  Acco rdingly, the Panel will consider the issues as 
follows:  the available data on viability of ALCM cocoons;  the effect of parasitism on viability of 
ALCM inside occupied cocoons;  the flight range for ALCM;  the period of emergence;  the climate 
conditions for spread of ALCM in Australia;  the mode of trade;  and, the potential biological and 
economic consequences associated with ALCM. 
7.790  For each of those issues, the Panel will identif y the scientific basis underlying the relevant 
analysis in the IRA.  Having identified that scien tific basis, the Panel will then verify whether it 
comes from a respected and qualified source.  Fina lly, the Panel will assess whether the reasoning 
articulated in the IRA on the basis of the scientific ev idence is coherent and objective.  In other words, 
as noted by the Appellate Body in Canada/US – Continued Suspension , "whether the particular 
conclusions drawn by [Australia 's IRA] find sufficient support in the scientific evidence relied 
upon".2273 
(a) Available data on viability of ALCM cocoons 
(i) Summary of the Parties' arguments 
7.791  New Zealand argues that Australia's IRA did not  take into account the proportion of cocoons 
with viable ALCM in its assessment of th e likelihood of ALCM entry and establishment.2274  
In New Zealand's view, this fact "i s obvious from the text of the IRA".2275 
"Australia ignored the scientific evidence available on the viability of cocoons found 
on New Zealand apples and focussed only on presence of cocoons, regardless of 
whether they contain live ALCM.  However, cocoons themselves are not a risk factor 
for ALCM.  It is only cocoons that contain viable ALCM that pose a potential risk.  Thus, Australia's conclusions about the leve l of infestation of New Zealand apples are 
not supported by scientific evidence."
2276 
7.792  New Zealand adds that Australia's measures are "based on the assumption that the overall 
percentage of viable cocoons was 100%".2277  However, "the scientific evidence indicates that the 
great majority of cocoons on New Zealand apples are not viable, either because the midge inside has 
already developed into an adult and left the coc oon (and the cocoon is thus empty), or because it has 
died inside the cocoon (and thus the cocoon is non-viable)."2278  New Zealand refers to a paper by 
                                                      
2273 Appellate Body Report on Canada – Continued Suspension , para. 590. 
2274 New Zealand's second written submission, para. 2. 692.  See also, New Zealand's opening oral 
statement at the second substantive meeting of the Panel with the Parties, para. 101. 
2275 New Zealand's second writte n submission, para. 2.692. 
2276 New Zealand's first writte n submission, para. 4.111. 
2277 New Zealand's second writte n submission, para. 2.223. 
2278 Ibid. WT/DS367/R 
Page 382  
 
 Rogers et al. (2006), and submits that this paper shows that according to which only 15 per cent of 
ALCM cocoons may contain live pupae.
2279 
7.793  Australia responds that, although the level of viable ALCM on New Zealand apples "is an 
important issue"2280, in preparing its IRA, it confronted a "significant lack of data available" on 
several key issues in dispute, including the viability of ALCM.2281  Australia argues that it had to 
exercise "expert judgement" in this situation.  "In this circumstance of scien tific uncertainty, the IRA 
Team had to exercise its expert judgment and est imate values for the probability of importation that 
would be appropriate for the whole of New Zealand taking into account variations between different 
areas of New Zealand and potential variations  in prevalence levels between seasons."2282 
7.794  Australia adds that, while exercising expert judgement, the IRA Team did take into account 
the issue of viability in ALCM cocoons, so that it did not consider cocoons themselves to be a risk 
factor and "used a triangular distribution for Importa tion step 2, which factored in the relatively low 
viability rate of cocoons by skewing the distribut ion towards the lower likelihood end and thereby 
giving less weight to the maximum value".2283  The IRA Team used the August 2005 data provided by 
New Zealand to estimate the probability of importa tion of ALCM.  The IRA Team assumed that this 
data reflected viability in cocoons.  Australia  noted New Zealand's acknowledgement during the 
experts consultation stage that the August 2005 da ta referred to occupied cocoons;  Australia 
submitted, however, that New Zealand had faile d to provide any evidence in support of its 
assertion.2284 
7.795  Australia considers that, in any event, New Ze aland has misinterpreted the results of the 
Rogers et al. (2006) paper as to the proportion of cocoons on New Zealand apples containing viable 
ALCM.2285  In Australia's view, according to the Rogers et al. (2006) paper, "around 25% of the total 
number of cocoons found in the sample of apples contained viable ALCM – not 15% as New Zealand 
claims".2286  Furthermore, the 25 per cent estim ate of viable cocoons in Rogers et al . (2006) "was 
probably an underestimation".2287  Therefore, the results of the Rogers et al . (2006) paper "are 
unreliable, and they do not reflect the pot ential for seasonal and geographic variability".2288 
7.796  Australia concludes that "New Zealand's faulty  estimations of the level of viable ALCM 
infestation of New Zealand apples has irredeemably tainted its estimations of likelihood of entry, 
                                                      
2279 Rogers et al., "Apple Leafcurling Midge Cocoons on Apple:  Pupal Occupancy and Mortality" 
(2006), in Exhibit NZ-17.  See New Zealand's first written submission, para. 4.337;  New Zealand's second 
written submission, para. 2.708-2.712. 
2280 Australia's reply to Panel question 97 after the second substantive meeting, para. 435. 
2281 Australia's opening oral statemen t at the second substantive meeting of the Panel with the Parties, 
para. 107.  See also, Australia's sec ond written submission, para. 633;  Austra lia's closing oral statement at the 
second substantive meeting of the Panel with the Parties,  para. 25;  Australia's reply to Panel questions 31 and 
97 after the second substantive meeting, paras. 185,  435 and 436;  Australia's comments on New Zealand's 
replies to Panel questions after the second substantive meeting, para. 176. 
2282 Australia's second written submission, para. 633.  See also, Australia's reply to Panel question 88 
after the first substantive meeting. 
2283 Australia's first written submission, para. 729.  Se e also, Australia's reply to Panel question 80 after 
the first substantive meeting;  Australia's second written submission, para. 626;  Australia's reply to Panel 
question 97 after the second substantive meeting, para. 439. 
2284 Australia's second written submission, paras. 629-632. 
2285 Australia's first written submission, para. 731;  Australia's second written submission, para. 623. 
2286 Australia's first written submission, para. 731. 
2287 Australia's first written submission, para. 733. 
2288 Australia's second written submission, para. 623.  WT/DS367/R 
 Page 383 
 
 
 establishment and spread, and consequently its asserti on as to the level of risk and the efficacy of 
particular measures to reduce the ri sk to achieve Australia's ALOP".2289 
(ii) The Panel's analysis 
7.797  Importation step 2 for the probability of entry, establishment and spread of ALCM refers to 
the likelihood that picked apple fruit is infested  with ALCM.  The IRA estimates this likelihood as a 
triangular distribution with a minimum of 1.5 × 10-2, a maximum of 0.115 and a most likely value 
of 5 × 10-2.2290  The IRA's estimation in this regard is "based on the evidence that contamination rates 
for pupae or larvae of apple leafcurling midge range from 1-2% to 11.5% of apples in the Bay of Plenty and the Waikato region respectively ..."
2291  This evidence is contained in a paper by 
Tomkins et al. (1994), which contains a survey conducted in April and May of 1994 of 30 blocks of 
Braeburn apples in the Waikato region and one bl ock in the Bay of Plenty (both regions in 
New Zealand).  The study found that 0-11.5 per cent of harvested apples were infested with ALCM 
cocoons, and that 63 per cent of coco ons were empty (contained no pupae).2292  It contains no data on 
the viability of ALCM pupae inside occupied cocoons. 
7.798  New Zealand takes issue with the releva nce and quality of the data in Tomkins et al.2293  More 
importantly, New Zealand argues that this data is insufficient insofar as the likelihood that picked 
apple fruit is infested with ALCM cannot be pr operly estimated without taking into account the 
viability of ALCM pupae inside occupied cocoons.  New Zealand has provided the Panel with a copy 
of the paper by Rogers et al. (2006) mentioned above.2294  This study found rates of 36.5 per cent to 
42.2 per cent of empty cocoons in apples from three varieties (Braeburn, Fuji and Royal Gala) surveyed in the Nelson region (in New Zealand) during 2005.  The study also found that "nearly 60% 
of all cocoons contained dead ALCM".
2295  Death was determined by prodding larvae and pupae 
found inside the cocoons;  "death character ized as failure to move when prodded".2296  Shrivelled 
larvae or pupae were considered to be non-viable.  In a subsequent letter, prepared during the course 
of this dispute and submitted by New Z ealand, the main author of the Rogers et al . (2006) paper 
explained that the 60 per cent figure for dead pupae "included both occupied and unoccupied 
cocoons".2297  Expressed as a percentage of occupied cocoons only, the mean mortality was estimated 
as 75 per cent.2298 
7.799  As a matter of fact, the IRA notes the observations contained in the Rogers et al. (2006) paper 
regarding the viability of ALCM cocoons found on New Zealand apples.2299  Notwithstanding this 
fact, Australia has explained that it questioned th e use of the prodding test to establish whether non-
                                                      
2289 Australia's first written submission, para. 736. 
2290 Australia's IRA, Part B, p. 160. 
2291 Ibid.  See also, Tomkins et al ., "A survey of Apple Leafcurling Midge ( Dasyneura mali ) 
management in Waikato orchards" (1994), pp. 346-349, in Exhibit NZ-43. 
2292 Tomkins et al., "A survey of Apple Leafcurling Midge ( Dasyneura mali ) management in Waikato 
orchards" (1994), pp. 346-349, in Exhibit NZ-43. 
2293 New Zealand's first written submission, para. 4. 336;  New Zealand's se cond written submission, 
para. 2.692;  New Zealand's comments on Australia's replies to Panel question 31 after the second substantive 
meeting, para. 101. 
2294 Rogers et al ., "Apple Leafcurling Midge Cocoons on Apple:  Pupal Occupancy and Mortality" 
(2006), in Exhibit NZ-17. 
2295 Ibid.. 
2296 Rogers et al ., "Apple Leafcurling Midge Cocoons on Apple:  Pupal Occupancy and Mortality" 
(2006), in Exhibit NZ-17. 
2297 Letter by Dr David J Rogers to Biosecurity New Zealand (18 August 2008), in Exhibit NZ-102. 
2298 Ibid. 
2299 Australia's IRA, Part B, pp. 160 and 191-192. WT/DS367/R 
Page 384  
 
 shrivelled ALCM larvae or pupae were alive or dead.
2300  According to Australia, the prodding test is 
not very accurate, because individuals that do not move in response to prodding could be viable.  
Australia argues that the use of the prodding test ma y have resulted in underestimating the number of 
viable cocoons.2301  In order to establish mortality, it woul d be better to observe whether occupants 
emerge as adults.2302  Indeed, Dr Cross notes some of the limitations of the Rogers et al. (2006) paper.  
He submits, for example, that "Australia is ... right  to question the use of the prodding test ... as this 
would not be a very accurate test."  At the same  time, Dr Cross acknowledges that a more accurate 
test for establishing mortality, such as rearing to adult, "could well [find] that mortality is 
considerably higher than established by examinati on and prodding."  Dr Cross notes that, given the 
crucial importance of viability in calculating risk s and determining appropriate sample sizes, 
Australia's IRA should take viability into account an d, accordingly, a more rigorous study should be 
conducted.  Until good data is produced, and given the l ack of data and likely variable nature of this 
parameter, Dr Cross suggests that Australia would be entitled to a conservative estimate of 50 per cent 
viability.2303   
7.800  The IRA contains some scientific data regarding the likely level of infestation with ALCM of 
apples from New Zealand and on cocoon occupancy, i. e., the proportion of cocoons containing pupae.  
However, the IRA devotes little consideration to th e issue of viability of ALCM pupae in occupied 
cocoons:  what proportion of those cocoons  contain viable ALCM larvae or pupae.2304  
Notwithstanding Australia's argument that the IR A Team used the August 2005 data provided by 
New Zealand unaware that this data did not reflect  viability in cocoons, there is no mention of this 
factor in the IRA.  On this point, the evid ence cited by the IRA is limited to the Rogers et al. (2006) 
paper.2305  The IRA refers to this paper, but then does not seem to take into account the findings on 
cocoon occupancy and viability in th e estimation for importation step 2.2306  As noted above, Australia 
says that the IRA does take viability into account by using the triangular distribution that skewed the 
results towards the lower end of the likelihood range. 
7.801  Additional evidence, which beca me available during these proceedings and was submitted by 
New Zealand at the time of its second written submi ssion, indicates that a substantial proportion of 
ALCM cocoons emerging from cold storage did not contain viable insects.2307  Australia has 
challenged the appropriateness of considering this  evidence, arguing that the IRA Team could not 
have taken into account data that was not available to it at the time.2308  Article 5.2 of the 
SPS Agreement provides that in their risk assessme nts Members shall take into account available 
evidence.  In any event, it is  not necessary for the Panel to express a view on whether scientific 
evidence that was not available at the time of the risk assessment should be considered when 
determining the conformity of a risk assessment with Article 5.1.2309  Disregarding the Sandanayaka 
                                                      
2300 Australia's first written submission, para. 733. 
2301 Ibid. 
2302 Ibid.  See also, reply of Dr Cross to Panel question 97, in List of Replies from the scientific experts 
to questions posed by the Panel, para. 566. 
2303 Dr Cross's reply to Panel question 97, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 566-568. 
2304 Dr Cross's replies in Transcript of the Panel's meeting with experts, paras. 584, 590, 594, 626, 674 
and 678.  See also, Dr Cross's reply to Panel question 104,  in List of Replies from the scientific experts to 
questions posed by the Panel, para. 614. 
2305 Australia's IRA, Part B, p. 160.  See also, Australia's IRA, Part B, pp. 191-192. 
2306 Dr Cross's reply to Panel question 109, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 650. 
2307 Sandanayaka and Rogers, "Effect of cold storage on emergence and mortality of apple leafcurling 
midge" (2009), pp. 1-8, in Exhibit NZ-119.  See, reply of Dr Cross in Transcript of the Panel's meeting with 
experts, para. 582. 
2308 Australia's reply to question 2 from New Zealand after the second substantive meeting, para. 554. 
2309 Appellate Body Report on Japan – Apples , para. 215.  WT/DS367/R 
 Page 385 
 
 
 and Rogers (2009) study, the fact remains that th e IRA did not take into account data on viability of 
ALCM pupae inside occupied cocoons.  Presumably, if only 25 per cent of cocoons contain viable ALCM, as Australia interprets the Rogers et al. (2006) paper, or for argument's sake if the percentage 
of viable ALCM is even higher, the values for impor tation step 2 should in any event be considerably 
smaller than estimated in the IRA.
2310  In this respect, Dr Cross expressed his view that, "[i]f only 
25% of cocoons contain viable ALCM then  the values should be 4 times smaller."2311  Indeed, 
importation step 2 assesses the likelihood that picked  apple fruit is infested with ALCM, based on the 
estimated number of apples infested with cocoons. 
7.802  The use of the prodding test, criticized by Au stralia, does not necessarily mean that the 
Rogers et al. (2006) paper underestimated the number of viable cocoons.  Although, in some cases, 
insects may not have moved when prodded, leading to  an overestimation of mortality, in other cases 
prodding could also have resulted in  underestimating the level of mortality of ALCM.  Observation 
continuing to adulthood might result in finding that mortality of ALCM is considerably higher than 
measured by prodding, because some pupae that mo ved when prodded and where accordingly scored 
as live may die subsequently and fail to emerge as adults.2312  Dr Cross expressed his view that the 
data in the IRA regarding the viability of ALCM , is "inadequate for an objective and credible 
assessment".2313 
7.803  The Panel notes Australia's argument that, in the absence of sufficient scientific data, the IRA 
Team exercised its expert judgement.2314  Australia states that "it is tr ue that [in the IRA] certain steps 
in the pathways assessed were better supported by eviden ce than others.  In those latter cases, expert 
judgment was employed."2315  In Australia's view, however, "this does not affect the overall 
sufficiency of scientific evidence in the Final IRA Report, and the Final IRA Report did not rely on 
100% expert judgment."2316  Australia adds that "in exercising its expert judgment ... the IRA Team 
took into account the available scientific evidence on a range of factors..."2317 
7.804  The Panel has already considered  Australia's arguments regarding the use of expert judgement 
in the IRA.2318  As noted above, while expert judgement may be an important tool for the risk 
assessor, it is not a substitute for the necessary scien tific data, especially for the purpose of estimating 
the likelihood of entry, establishment and spread of  a pest.  In accordance with the relevant ISPMs, 
                                                      
2310 In its section on Risk Management for ALCM, the IRA notes that "New Zealand provided 
additional data (Rogers et al. , 2006) showing that 36–42% of apple leafcurling midge cocoons on apples were 
empty, and nearly 60% of all cocoons contained dead apple leafcurling midge.  However, the IRA team still 
considers that this low level of infestation is still a risk, albeit a lower risk and maintains that a 3000 fruit 
inspection is required."  Australia's IRA,  Part B, p. 192.  There is no ex planation of how the IRA team reached 
this conclusion. 
2311 Dr Cross's reply to Panel question 109, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 650. 
2312 Dr Cross's reply to Panel questions 97 and 110, in List of Replies from the scientific experts to 
questions posed by the Panel, paras. 566 and 652. 
2313 Dr Cross's reply to Panel question 97, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 564;  Dr Cross's replies in Transcript of the Panel's meeting with experts, paras. 584, 586, 588 and 590. 
2314 See, for example, Australia's first written submissi on, para. 21;  Australia's reply to Panel questions 
88 and 93 after the first substantive meeting;  Austra lia's second written submission, paras. 9, 121, 124, 241, 
401, 467, and 633;  Australia's opening oral statement at the second substantive meeting of the Panel with the 
Parties, paras. 3 and 7.  See also, Aust ralia's IRA, Part B, pp. 167 and 178. 
2315 Australia's opening oral statemen t at the second substantive meeting of the Panel with the Parties, 
para. 12. 
2316 Ibid. 
2317 See, for example, Australia's second written submission, para. 520.  See also, Australia's second 
written submission, para. 576. 
2318 See paras. 7.433-7.440 above. WT/DS367/R 
Page 386  
 
 recourse to expert judgement does not substitute for th e use of the available information.  The use of 
expert judgement must be documented and transpar ent;  it must be based on the relevant reliable 
scientific information, even when that info rmation is limited.  Non-compliance with these 
requirements may produce errors in the exercise of expert judgement.  It is not enough to claim, as 
Australia has done, that in "circumstance of scientif ic uncertainty, the IRA Team had to exercise its 
expert judgment and estimate values for the probabili ty of importation that would be appropriate for 
the whole of New Zealand taking into account varia tions between different areas of New Zealand and 
potential variations in preval ence levels between seasons".
2319  Because it is subject to certain rules, 
the exercise of expert judgement is not immune from examination by a Panel. 
7.805  As noted by Dr Cross, the data on viability rates is crucial, in order to estimate the likelihood 
that picked apple fruit is infested with ALCM.2320  New Zealand has made a prima facie case, not 
rebutted by Australia, that the data on occupancy and viability of ALCM in cocoons on New Zealand 
apples was not adequately taken into account.  Ther e is no indication in Australia's IRA of how the 
exercise of expert judgement could have cured this.  Moreover, because the recourse to expert 
judgement in the IRA was not documented and transp arent, the Panel is prevented from considering 
how the available scientific evidence was taken into  account and conclusions were drawn through this 
exercise. 
7.806  As a result, the Panel finds that the IRA's re asoning regarding the viability of ALCM, is not 
objectively justifiable. 
(b) Effect of parasitism on viability of ALCM inside occupied cocoons 
(i) Summary of the Parties' arguments 
7.807  Another factor that may affect the viability of ALCM inside occupied cocoons is the possible 
incidence of parasitism, caused by the wasp Platygaster demades .  New Zealand argues that 
Australia's IRA did not take into account the possible effect of this type of parasitism on the viability 
of ALCM cocoons.  In New Zealand's view: 
"[One of the reasons] for the high number of non-viable cocoons is that a high 
number of occupied cocoons actually contain dead pupae.  This is caused primarily 
by the wasp, Platygaster demades , introduced to New Zealand in 1925 to control 
apple/pear leafcurling midge.  This par asite lays eggs inside the ALCM eggs, 
develops in the mature ALCM larva and emerges from the ALCM cocoon killing the 
pupa inside (Shaw et al.  2005:  306).  Indeed, high levels (50 – 60%) of parasitism by 
the wasp Platygaster demades  have been reported recently in third and fourth 
generation ALCM cocoons (Shaw et al.  2005:  310).  Heavy parasitism of later 
generations has also been recorded by Todd 1959:  868."2321 
7.808  Again, Australia refers to the limited information available on the question of ALCM 
prevalence on New Zealand apples, in cluding on the level of parasitism by Platygaster demades .2322  
In this circumstance of scientific uncertainty, th e IRA Team also exercised its expert judgement.2323 
                                                      
2319 Australia's second written submission, para. 633.  See also, Australia's reply to question 31 from 
the Panel after the second substantive meeting, para. 185. 
2320 Dr Cross's reply to Panel question 97, in List of  Replies from the scientific experts to questions 
posed by the Panel, paras. 564 and 568. 
2321 New Zealand's first writte n submission, para. 4.110. 
2322 Australia's second written submission, para. 633. 
2323 Ibid.  See also, Australia's reply to Panel question 31 after the second substantive meeting, 
para. 185.  WT/DS367/R 
 Page 387 
 
 
 (ii) The Panel's analysis 
7.809  The IRA notes that: 
"[ALCM] is partially controlled in New Zealand by a parasitic wasp, Platygaster 
demades  (Walker), an introduced biological control agent (Todd, 1959;  Tomkins 
et al., 2000).  In responding to the revised draft IRA New Zealand has provided 
further information indicating that P. demades plays a significant role in reducing 
apple leafcurling midge populations (Shaw et  al., 2005) with high levels of parasitism 
being recorded.  However, this parasitoid is not present in Australia (Evenhuis, 1989).  
Thus there is no information available to determine if this parasitoid would be 
effective in controlling apple leafcurling midge in Australia."2324 
7.810  Notwithstanding these references to the existence of Platygaster demades  in New Zealand, 
the IRA does not consider the impact of paras itism by that arthropod on cocoon occupancy and 
viability in the estimation for importation step 2.  Presumably, if parasitism by Platygaster demades  
reduces the proportion of viable cocoons2325, the values for importation step 2 should be considerably 
smaller.2326  Consulted by the Panel, Dr Cross expressed his view that the data in the IRA regarding 
the viability of ALCM, is "inadequate fo r an objective and credible assessment".2327 
7.811  As noted above, the data on viability rates is cr ucial, in order to estimate the likelihood that 
picked apple fruit is infested with ALCM.2328  The sources of data on the possible effects of parasitism 
by Platygaster demades  in Australia's IRA are very sparse and do not seem to have been adequately 
taken into account.  With respect to this point, there is no indication in Australia's IRA that the exercise of expert judgement could have cured the f act that the limited data was not adequately taken 
into account.  Moreover, because the recourse to e xpert judgement in the IRA was not documented 
and transparent, the Panel is prevented from cons idering how the available scientific evidence was 
taken into account and conclusions were drawn through this exercise. 
7.812  As a result, the Panel finds that the IRA's r easoning regarding the viability of ALCM in the 
light of the possible incidence of parasitism by the wasp Platygaster demades  is not objectively 
justifiable. 
(c) Flight range for ALCM 
(i) Summary of the Parties' arguments 
7.813  New Zealand argues that the evaluation of estab lishment and spread of ALCM in Australia's 
IRA is also based on incorrect assumptions  regarding the flight range of ALCM.
2329  New Zealand 
notes that the IRA's estimation "requires that utility points at which apples will be discarded will be in 
sufficient proximity to apple trees with growing s hoots (given that ALCM only lay eggs on freshly 
                                                      
2324 Australia's IRA, Part B, p. 176.  See also , Australia's IRA, Part B, pp. 178 and 180. 
2325 Dr Cross's reply to Panel question 100, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 584. 
2326 Dr Cross's reply to Panel questions 104 and 109, in  List of Replies from the scientific experts to 
questions posed by the Panel, paras. 615 and 650;  Dr Cr oss's replies in Transcript of the Panel's meeting with 
experts, paras. 590, 594 and 678. 
2327 Dr Cross's reply to Panel question 97, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 564;  Dr Cross's replies in Transcript of the Panel's meeting with experts, paras. 584 
and 590. 
2328 Dr Cross's reply to Panel question 97, in List of  Replies from the scientific experts to questions 
posed by the Panel, paras. 564 and 568. 
2329 New Zealand's first writte n submission, para. 4.352. WT/DS367/R 
Page 388  
 
 unfurling apple tree leaves) for mating and egg laying to occur".
2330  "If apple waste was disposed of 
more than 100 metres from apple trees, even if ALCM emergence and mating could occur, establishment would not take place because there w ould be nowhere within flight range for mated 
female ALCMs to lay their eggs."
2331  The IRA "appears to base its calculations on a flight range for 
ALCM of up to 200 metres, a figure which Australia appears to draw from Suckling et al.  2007".2332 
7.814  In New Zealand's view, there is no scientific evidence to support the assumption that female 
ALCM can fly up to 200 metres.2333  "ALCM are not strong fliers, and are not capable of directional 
flight over long distances.  Mated female midges have  been found to have a flight range of less than 
30m (Suckling et al.  2007:  750).  Male flight range is  thought to be similar (Suckling et al.  2007:  
750).  As a result, spread of ALCM by flight alone is highly localised."2334 
7.815  Again, Australia refers to the limited info rmation available on the question of ALCM on 
New Zealand apples, including on the flight distance of ALCM.2335  In this respect, Australia states 
that the IRA relied upon scientific evidence from Cross (2005), Suckling et al . (2007) and 
HortResearch (1999b).2336 
7.816  The IRA notes that "[ALCM] were detected in a block of newly established apple trees at 200 
metres from the source (the furthest distance tested)".2337  Australia argues, however, that the IRA 
placed "relatively little weight on the possibility  that ALCM could fly up to 200 metres".2338  The IRA 
"did not even refer to the 200 metre figure in its main discussion of ALCM flight distance in the 
context of a transfer to suitable hosts".2339 
7.817  Australia refers to informati on from Cross (2005) claiming that  male ALCM were caught at 
distances up to 50 metres when testing sex pheromone  traps;  the distances beyond 50 metres were not 
investigated, suggesting that 50 metres was not a maximum distance".2340  Australia adds that, "[i]n 
any event, it is ultimately female flight that  matters for establishment once mating has occurred".2341  
"The research in Suckling et al. (2007) does not speak to the situation where a mated female must  fly 
further than 30 metres in order to find a suitable host on which to lay her eggs."2342 
                                                      
2330 New Zealand's first writte n submission, para. 4.353. 
2331 New Zealand's second writte n submission, para. 2.261. 
2332 New Zealand's first written submission, para. 4.353.  Suckling et al ., "Trapping Dasineura mali 
(Diptera:  Cecidomyiidae) in Apples" (2007), in Exhibit NZ-15.  See also, New Zealand's reply to Panel 
question 81 after the first substantive meeting, paras.  186-188;  New Zealand's second written submission, 
paras.  2.237 and 2.736-2.737. 
2333 New Zealand's second written submission, para. 2.237.  See also, New Zealand's second written 
submission, paras.  2.239-2.243. 
2334 New Zealand's first written submission, para. 3.77.  See also, New Zealand's first written 
submission, paras. 4.116, 4.125;  New Zealand' s second written submission, paras.  2.244-2.245. 
2335 Australia's comments on New Zealand's replies to Panel questions after the second substantive 
meeting, para. 176. 
2336 Australia's first written submission, para. 803.   See, Australia's IRA, Part B, p. 171. 
2337 See Australia's IRA, Part B, p. 168.  See,  Australia's first written submission, para. 803. 
2338 Australia's second written submission, para. 669.  See also, Australia's first written submission, 
para. 803. 
2339 Australia's second written submission, footnote 1178 to para. 669.  See, Au stralia's IRA, Part B, 
p. 171.  See also, Australia's first written submission, para. 803. 
2340 Australia's first written submission, para. 804.  See Cross (2005), Personal communication from 
Jerry Cross of East Malling Research, Kent, UK on apple leaf curling midge (30 March 2005), in Exhibit AUS-
96.  Published in Table 5 of Cross & Hall, Crop Protection  28 (2009), pp. 139-144;  see, Dr Cross's reply to 
Panel question 94(iii), in List of Replies from the scientif ic experts to questions posed by the Panel, para. 534. 
2341 Australia's first written submission, para. 805. 
2342 Australia's second written submission, para. 670.  WT/DS367/R 
 Page 389 
 
 
 7.818  Australia adds that: 
"New Zealand's claim is predicated on the b asis that ALCM has to physically fly the 
distance to locate hosts but the IRA Team cons idered that it is equally probable that a 
gust of wind or other mechanical means can give the ALCM a further boost to its flight range.  HortResearch (1999) notes that 'some researchers consider them strong 
fliers able to disperse well in wind, and [ALCM] has a history of rapid spread when 
introduced to new areas.'"
2343 
7.819  Australia finally notes that "a flight range of  30-50 metres for a mated female ALCM would 
be ample in many cases between an orchard packi ng house co-located within an apple orchard".2344 
(ii) Analysis of the Panel 
7.820  In relevant part, the IRA notes that: 
"Both the adult male and female [ALCM] have wings and are able to fly.  Maximum 
flight activity has been observed under warm, calm conditions , although small 
numbers have been seen on the wing even wh en the weather is cool, overcast, and 
windy.  Recent research on the response of apple leafcurling midge to apple midge 
sex pheromone has shown that 'significant numbers of (male) midges were caught at 
all distances up to 50m and greater distances were not investigated';  however, 'numbers caught at 50m were still significan t (several per day)' and 'no experiments 
on the distances females can fly' have been  attempted (Cross, 2005) …  Suckling et 
al. (2006) report that female apple leafcurling midges did not fly much further than about 30m to colonise adjacent newly established apple orchards from large 
populations in mature trees.  Female wing loadings were found to be 1.8 times greater 
than they are for male midges which supports the likely shorter distance of female flight and is consistent with estimates of  male distance movements to traps baited 
with female sexpheromone.  Neverthel ess, some researchers consider apple 
leafcurling midge are able to disperse well with the wind (HortResearch, 1999b)."
2345 
7.821  Commenting on information provided by New Zealand on the distance that ALCM are 
thought to fly, the IRA states that the "IRA team noted that midge were detected in a block of newly established apple trees at 200 metres from the source (the furthest distance tested)."
2346  The 200 
metres distance seems to be based on the background rate of infestation shown in Figure 4 of Suckling 
et al.  (2007).2347  However, as noted by Dr Cross, this data  does not show that these infestations were 
caused by longer range movement of females from the adjacent block.  Suckling et al.  (2007) only 
suggest that low levels of ALCM infestati on were present on the new trees when they were 
planted.2348  In any event, the IRA team "concluded that  this information from a single experiment in 
one season did not justify alte ring the proximity values."2349 
                                                      
2343 Australia's first written submission, para. 806. 
2344 Australia's first written submission, para. 808.  See also, Reply of Dr Cross to Panel question 
94(iii), in List of Replies from the scientific ex perts to questions posed by the Panel, para. 534. 
2345 Australia's IRA, Part B, p. 171. 
2346 Australia's IRA, Part B, p. 168. 
2347 Suckling et al ., "Trapping Dasineura mali (Diptera:  Cecidomyiidae) in Apples" (2007), in 
Exhibit NZ-15. 
2348 Dr Cross's reply to Panel question 94(iii), in List of Replies from the scientific experts to questions 
posed by the Panel, para. 534. 
2349 Australia's IRA, Part B, p. 168. WT/DS367/R 
Page 390  
 
 7.822  Dr Cross expressed his view that, generally speak ing, there is little scientific data regarding 
the flight range of ALCM.
2350  The data cited in the IRA2351 confirms that ALCM is a weak flier;  it 
tends to spend most of the time close to the gr ound and only flies to lay its eggs on growing apple 
shoots when wind conditions are slight.2352  The small amount of available evidence shows that the 
ALCM is unlikely to fly long distances.2353  As noted by the IRA, Cross (2005) found that male 
ALCM could be attracted over a distance of 50 metr es (the greatest distance investigated) away from 
the host plant by a sex pheromone lure.  Dr Cross no ted that the flight range of females relative to 
males has not been investigated.  In his opinion, it is possible that the flight range of females is shorter 
than males, because femal es are carrying the additional weight of  eggs.  He cautioned, however, that 
females tend to have slightly larger, and perhaps stronger, bodies and wings which might 
compensate.2354  There is also no evidence to support the IRA's argument that gusts of wind may 
increase the flight range of female ALCM.  Altho ugh this is something that would seem logical, 
ALCM avoids flying in windy conditions.2355  Accordingly, there is no indication that the evidence 
considered by the IRA Team on the flight ra nge for ALCM does not come from respected and 
qualified sources. 
7.823  In conclusion, in the Panel's view, there is insufficient scientific evidence that would have 
allowed Australia to reach a definitive conclu sion on the precise flight range for ALCM.2356  In any 
event, in the light of the limited information there is, the lack of a precise flight range for ALCM does 
not necessarily call into question the IRA's reas oning regarding whether orchards surrounding 
wholesale pack houses may be located  at a distance that is within the flying range of ALCM.  
Australia's assertion that "a flight range of 30-50 metres for a mated female ALCM would be ample in 
many cases between an orchard packing hou se co-located within an apple orchard"2357, seems 
reasonable.2358  Although it is unlikely that a mated female midge would be able to fly hundreds of 
metres, the 200 metre distance noted by the IRA would not be unreasonable.2359 
7.824  As a result, accepting for the moment the IRA' s assumptions regarding the way in which 
New Zealand apples would be distributed in Australia2360, the Panel finds that New Zealand has not 
made a prima facie case that orchards surrounding wholesale packing houses would not be located at 
a distance that is within the flying range of ALCM.2361 
                                                      
2350 Dr Cross's replies in Transcript of the Panel's meeting with experts, paras. 584, 586, 614 and 674. 
2351 Personal communication from Jerry Cross of East Malling Research, Kent, UK on apple leaf 
curling midge (30 March 2005), in Exhibit AUS-96;  Suckling et al., "Crop colonisation by apple leaf curling 
midge" (2006);  HortResearch, "Insects and mites of pipfruit and stonefruit" (1999). 
2352 Australia's IRA, Part B, p. 157.  Dr Cross's replie s in Transcript of the Panel's meeting with experts, 
para. 586 and 614. 
2353 Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 584. 
2354 Dr Cross's reply to Panel question 94(iii), in List of Replies from the scientific experts to questions 
posed by the Panel, para. 534. 
2355 Ibid.  See also, Dr Cross's replies in Transcript of the Panel's meeting with experts, paras. 584, 610, 
612 and 674. 
2356 Dr Cross's reply to Panel questions 94(iii) and 103, in List of Replies from the scientific experts to 
questions posed by the Panel, paras. 535 and 597;  Dr Cross's reply in Transcript of the Panel's meeting with 
experts, para. 584. 
2357 Australia's first written submission, para. 808. 
2358 Dr Cross's reply to Panel question 94(iii), in List of Replies from the scientific experts to questions 
posed by the Panel, para. 534;  Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 584. 
2359 Dr Cross's replies in Transcript of the Panel's meeting with experts, paras. 586 and 614. 
2360 Australia's IRA, Part B, pp. 171-172.  Th e Panel will return to this issue below, see 
paras. 7.856-7.865 below. 
2361 Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 584.  WT/DS367/R 
 Page 391 
 
 
 (d) Period of emergence 
(i) Summary of the Parties' arguments 
7.825  New Zealand argues that the evaluation of estab lishment and spread of ALCM in Australia's 
IRA is also based on incorrect assumptions regarding the period that would be needed for ALCM to 
emerge after being removed from cold storage.2362 
7.826  According to New Zealand, "ALCM will not emerge from fruit as soon as it is removed from 
cold storage.  It first has to break diapause and complete pupation, which takes at least 13-18 days 
(Barnes 1948:  36).  Thus, an ALCM could not emer ge from a viable cocoon attached to a discarded 
apple during the few hours it might remain uncovered as waste."2363 
7.827  In its second written submission, referring to recent research2364, New Zealand reiterates its 
position that viable ALCM would need at least 13  days to emerge after being removed from cold 
storage.2365  New Zealand emphasizes, however, that what ever the minimum length of time for adult 
ALCM emergence, the key fact would be "that emer gence of viable individuals would be staggered 
over a prolonged period of time and not, as Aust ralia assumed, simultaneously after removal from 
cold storage".2366 
7.828  In New Zealand's view: 
"Australia's measures are based on the inco rrect assumption that all ALCM present on 
New Zealand apples would simultaneously emerge as soon as the apples were 
removed from cold storage.2367  In order for this to be true all ALCM present on 
New Zealand apples would have to be fully developed pupae which, upon being 
taken out of cold storage, would not requi re any development time.  As confirmed by 
the experts, this assumption is not su pported by the scientific evidence."2368 
7.829  New Zealand adds that, "the prolonged peri od of emergence substantially decreases the 
chance of male and female emerging during the necessary time frame for mating."2369 
7.830  Australia responds that New Zealand should not  be permitted to raise the issue of the 
extended period of time over which adult emergence may take place, because it had not raised that 
issue in its first written submission.  In Australia's view, this is an issue that New Zealand raised only 
after having heard the replies by one of the experts to questions posed by the Panel.2370 
                                                      
2362 New Zealand's first written submission, para. 4.116-4.124. 
2363 New Zealand's first writte n submission, para. 4.131. 
2364 Sandanayaka and Rogers "Effect of cold storag e on emergence and mortality of apple leafcurling 
midge" (2009), pp. 1-8, in Exhibit NZ-119. 
2365 New Zealand's second writte n submission, para. 2.247. 
2366 Ibid. 
2367 (footnote original ) IRA, p. 171, which states: "…adults coul d emerge from the pupal stage after the 
apples have been taken out of cold storage, or wherev er the cold chain is broken , such as at unpacking and 
repacking facilities or retailers and during the transportatio n of purchased apples from retailers to households or 
with fruit that is dumped":  This is confirmed by  Professor Cross:  Cross RPQ, Q 94 (i), p. 2. 
2368 New Zealand's second written submission, para . 2.246.  See also, New Zealand's comments on 
Australia's replies to Panel question 24 after the second substantive meeting, para. 77. 
2369 New Zealand's opening oral statement at the s econd substantive meeting of the Panel with the 
Parties, para. 104. 
2370 Australia's reply to Panel question 24 after the second substantive meeting, para. 140. WT/DS367/R 
Page 392  
 
 7.831  Australia adds that New Zealand has failed to demonstrate any serious flaw with the IRA.  
Australia argues that the issue of whether su fficient quantities of New Zealand apples will be 
co-located and remain out of cold storage for a suffi cient period of time for a mating pair of ALCM to 
emerge within close enough proximity to a suitable host at an appropriate time of year has been 
appropriately taken into account in the IRA.
2371 
7.832  In Australia's view, New Zealand seems to assu me that the insects in the cocoons on imported 
New Zealand apples will all be at exactly the same stage of development;  that is, the prepupal stage 
prior to metamorphosis of the pupa l stage.  However, the IRA cons idered it more likely that, when 
harvest occurs, various ALCM present in cocoons will be  at different stages of development.  It is 
probable that some larvae will have progressed beyo nd the prepupal stage to the pupal stage and will 
be ready to emerge as adults as soon as the appropria te environmental triggers are encountered by the 
pupa, rather than wait the 13-18 days as recorded by Barnes (1948).2372 
7.833  Australia submits further that New Zealand's argu ments, predicated on its view that the 13-18 
day development period referred to in Barnes (1948) commences only once insects are removed from 
cold storage, are unsupported by evidence.  By contrast, as noted by Dr Cross, "Australia is probably 
correct to assert that (some) adults could emerge  as soon as the appropriate triggers are encountered 
by the pupa."  Australia adds that Dr Cross empha sised that the conditions in respect of diapause, 
temperature and time requirements for developm ent have not been determined for ALCM, and 
concluded that "Australia's IRA re lating to this issue was objective and credible and relied on [the] 
limited scientific evidence available."2373 
(ii) Analysis of the Panel 
7.834  The IRA notes that: 
"A stakeholder claims that key factors for the termination of pupal diapause in 
New Zealand include critical day length and subsequent temperatures.  First adult 
emergence in New Zealand is synchronised  with unfurling young apple shoots and 
Tomkins et al. (2006) report emergence of overwintered adult midge from mid-
September to mid-November.  Pupal developm ent time to adult emergence is claimed 
to be 30 days at a constant 23ºC (M AFNZ, 2006a) based on field collected pre-pupae 
reared in the laboratory so it is certainly unrealistic to take 30 days as a minimum.  Fluctuating temperatures in the field mean  that pupal development time could be 
shorter or longer than 30 days and until further data sets are available it is unwise to rely upon pupal development times at such unrealistic temperatures."
2374 
7.835  The Panel has already rejected Australia's argu ment that New Zealand should be prevented 
from raising issues that it did not raise in its first written submission, including issues that were raised 
after having heard the replies of the experts consulted by the Panel.2375  In any event, the Panel notes 
that the specific issue of whether the IRA contains  incorrect assumptions regarding the period that 
would be needed for ALCM emergence is part of New Zealand's claim that Australia's IRA is not a 
proper risk assessment within the meaning of Ar ticle 5.1 of the SPS Agreement and is therefore 
within the Panel's terms of reference.  This issu e was initially raised by New Zealand in its first 
written submission.2376  As noted before2377, the Panel sees no impediment in Parties setting out and 
                                                      
2371 Australia's second written submission, para. 639. 
2372 Australia's first written submission, para. 797. 
2373 Australia's second written submission, para. 658. 
2374 Australia's IRA, Part B, p. 171. 
2375 See paras. 7.80-7.82 above. 
2376 New Zealand's first written submission, para. 4.116-4.124.  WT/DS367/R 
 Page 393 
 
 
 progressively clarifying their arguments in their successive submissions and statements before the 
Panel, in the light of each other' s arguments, of the arguments advanced by Third Parties, of the 
questions posed by the Panel, and of the explanati ons provided by the experts consulted by the Panel. 
7.836  The IRA notes that "[i]f mature larvae or pupae survive cold storage or controlled atmosphere 
storage, adults could emerge from the pupal stage afte r the apples have been taken out of storage, or 
wherever the cold chain is broken".2378  Dr Cross expressed his opinion that the IRA's reasoning in 
this regard seems objective and credible.2379 
7.837  As noted by Australia, it seems likely that AL CM in cocoons on apple fruits emerging from 
cold storage will be at a wide range of stages of  development, including:  larvae that have just 
cocooned and need to complete diapause and post-d iapause development;  mature larvae that have 
just cocooned and do not require di apause, but have to complete pu pal development;  pupae at various 
stages of development, including some at late stages of development that were nearly ready to emerge as adults at the moment of entering into cold storage.
2380  New Zealand has not provided scientific 
evidence to prove its apparent assumption that cold storage of apples would kill individuals that were 
pupating or force them into diapause.2381 
7.838  Dr Cross has noted that the overall effect of th is broad range of ALCM development stages is 
a prolonged period of emergence of viable individu als.  The emergence period of the midges would 
depend on the conditions in which the fruit has been  stored, and the environmental conditions when it 
is released in Australia (the time of year, temperatures, etc.).  The resulting emergence could be a protracted one, of many weeks.
2382  This protracted emergence of AL CM adults relative to their short 
life span would substantially decrease the chances of  a male and female ALCM emerging within the 
time frame of a few days, which is required for successful mating.  The likelihood of establishment 
would thus be substantially reduced.2383  As noted by Dr Cross, "[i]f the midge is only able to survive 
for a couple of days in the natural world and the mi dges are emerging over a period of 3, 4, 5, 6 weeks 
or maybe up to a year, then the chances of the estab lishment of the infestation are very significantly 
reduced."2384 
7.839  There is no evidence in the IRA regarding th e time necessary for ALCM to emerge after 
apples have been removed from cold storage.  Cons ulted by the Panel, Dr Cross expressed his view 
that Australia's assertion that some adults coul d emerge as soon as the appropriate triggers are 
encountered by the pupae may be correct, but  is not supported by sufficient evidence.2385  Similarly, 
                                                                                                                                                                     
2377 See paras. 7.80-7.82 above. 
2378 Australia's IRA, Part B, p. 171. 
2379 Ibid.  See also, Dr Cross's reply to Panel questions  94(i) and (viii), in List of Replies from the 
scientific experts to questions posed by the Panel, paras. 532 and 547. 
2380 Dr Cross's reply to Panel questions 94(i) and (viii), in List of Replies from the scientific experts to 
questions posed by the Panel, paras. 532 and 546;  Dr Cross's reply in Transcript of the Panel's meeting with 
experts, para. 582. 
2381 Dr Cross's reply to Panel question 94(i), in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 532. 
2382 Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 582.  See, Sandanayaka and 
Rogers "Effect of cold storage on emergence and morta lity of apple leafcurling midge" (2009), pp. 1-8, in 
Exhibit NZ-119. 
2383 Dr Cross's replies to Panel questions 102, 109 and 11 5, in List of Replies from the scientific experts 
to questions posed by the Panel, paras. 594, 650 and 672;  Dr Cross's replies in Transc ript of the Panel's meeting 
with experts, paras. 590 and 630. 
2384 Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 590.  See also, Dr Cross's 
reply in Transcript of the Panel's meeting with experts, para. 630. 
2385 Dr Cross's reply to Panel question 94(i), in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 531. WT/DS367/R 
Page 394  
 
 New Zealand's contention that at least 13 to 18 days  would be needed is not sufficiently supported by 
evidence.
2386  In response to Dr Cross's responses, Austra lia has pointed to the IRA and submitted that 
"[i]t is clear ... that the IRA Team fully appreci ated the many uncertainties and small likelihoods 
associated with the potential of ALCM to establish in Australia."2387  This does not respond to the 
question, however, of whether the IRA took into acc ount the impact of the protracted emergence of 
ALCM adults on the likelihood of transfer, nor does it identify any evidence in the IRA regarding the 
necessary time for ALCM emergence. 
7.840  As noted by Dr Cross, the issue of the protract ed emergence of ALCM, in relation to its short 
life-span, is an important factor in considering the likelihood of transfer.2388  There is no evidence in 
the IRA regarding the necessary time needed for ALCM to emerge after being removed from cold 
storage.  Nor does the IRA's reasoning take into account the fact that a longer period of adult 
emergence would substantially reduce the likel ihood of small numbers of individuals in a 
consignment emerging within a few days of each other and being able to mate and lay eggs to start a 
population.2389 
7.841  As a result, the Panel finds that the IRA's re asoning regarding the likelihood of transfer of 
ALCM in the light of the protracted emergence of ALCM is not objectively justifiable. 
(e) Climatic conditions for spread of ALCM in Australia 
(i) Summary of the Parties' arguments 
7.842  New Zealand argues that the IRA did not properl y take into account the climatic conditions 
that are necessary for the establishment and spread of ALCM.2390  According to New Zealand, "there 
is also no scientific basis for the IRA's conclusi ons in respect of the likelihood of ALCM spread, 
because the IRA failed to factor in climatic issues ... The IRA did not deal with the important issue of 
climate, and the conditions necessar y for ALCM survival, at all."2391 
7.843  New Zealand contends that: 
"Even if ALCM were to establish in Austra lia, the likelihood of spread is remote.  
ALCM distribution and pest status appears to be limited to cooler wetter climatic 
conditions, such as those found in temperat e coastal regions (Rogers 2006:  1). ... 
Based on [the experience of other regions of the world], if ALCM were ever to 
become established in Australia, it is highly unlikely that it would become successfully established in all of the areas where apples are grown commercially and 
                                                     
 
2386 Dr Cross's reply to Panel question 94(i), in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 530;  Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 582. 
2387 Australia's comments on the experts replies to questions, para. 257. 
2388 Dr Cross's replies to Panel questions 102, 109 and 11 5, in List of Replies from the scientific experts 
to questions posed by the Panel, paras. 594, 650 and 672;  Dr Cross's replies in Transc ript of the Panel's meeting 
with experts, paras. 590 and 630. 
2389 Dr Cross's replies to Panel questions 94(i), 102 and 104, in List of Replies from the scientific 
experts to questions posed by the Panel, paras. 532, 594 and 615.  See also, Dr Cross's reply in Transcript of the 
Panel's meeting with experts, para. 678. 
2390 New Zealand's second written submission, para. 2.761-2.762.  See also, New Zealand's reply to 
Panel question 81 after the first substantive meeting, para s. 191-192;  New Zealand' s second written submission, 
para. 2.764;  and New Zealand's opening oral statement at  the second substantive meeting of the Panel with the 
Parties, para. 107. 
2391 New Zealand's second written submission, paras.  2.761-2.762 (footnote omitted).  See also, 
New Zealand's second written submission, paras.  2.268 and 2.766.  WT/DS367/R 
 Page 395 
 
 
 where apple trees are grown in domestic gardens.  It is highly unlikely that ALCM 
would either establish or have any pest st atus in the areas of Australia which do not 
have suitable climatic conditions (e.g. areas north of Canberra, including Sydney, 
which are too hot and dry)."2392 
7.844  According to New Zealand, "[t]he IRA's failure to take into account cl imate issues allowed it 
to overestimate the likelihood of ALCM spread in Australia. ... Indeed, if the only area conducive to 
ALCM establishment is Tasmania then this grea tly reduces the likelihood of ALCM establishment 
and spread."2393 
7.845  Australia responds that the IRA "took into account climate-related issues for [ALCM] 
spread".2394  It notes that the IRA states that, "[a]ppl e leafcurling midge has spread all over 
New Zealand since its accidental introduction in a bout 1950.  There are similar environments in 
Australia that would be suitable for its spread."2395 
7.846  In its first written submission, Australia argues that "Australian states such as Victoria, 
Tasmania and New South Wa les have the types of cool climate su ited to the establishment and spread 
of ALCM, and a considerable proportion of Aust ralia's commercial apple producing regions are 
situated in such regions."2396 
7.847  Subsequently, in response to a question from th e Panel, Australia goes further and states that: 
"To the extent that the pests at issue [inc luding ALCM] are pests of apples, pears and 
other host plants, the climatic conditions  in Australia would be suitable for 
establishment of the three pests in all areas that apples, pears and other host plants 
grow.  These areas include the major citi es of Perth, Adelaide, Melbourne, Hobart 
and Sydney.  It also includes most of south-eastern Australia and south Western 
Australia."2397 
7.848  Australia also argues that, contrary to New Ze aland's contention, "[the IRA's] assessment of 
the probability of spread did not assume that ALCM would necessarily spread to all apple growing 
areas and gardens of Australia, nor should it have do ne.  'Spread' will have been achieved if the pest 
spreads beyond its place of establishment to any other part of Australia."2398 
(ii) The Panel's analysis 
7.849  As noted above, there is very little mention in  the IRA regarding the existence of climatic 
conditions necessary for spread of ALCM in Austra lia.  The IRA only notes that "Apple leafcurling 
midge has spread all over New Zealand since its ac cidental introduction in about 1950.  There are 
similar environments in Australia that would be suitable for its spread."2399 
7.850  Consulted by the Panel, Dr Cross expressed his vi ew that "clearly there are certain climatic 
requirements for the midge's survival and we do kno w that it doesn't occur ev erywhere in the world 
                                                      
2392 New Zealand's first written submission, paras.  4. 364-4.365.  See also, New Zealand's first written 
submission, paras.  4.369 and 4.375;  New Zealand's second written submission, para. 2.780. 
2393 New Zealand's second written submission, para. 2. 766 (footnote omitted).  See also, New Zealand's 
second written submission, para. 2.767. 
2394 Australia's first written submission, para. 812. 
2395 Ibid.  See also, Australia's IRA, Part B, p. 177. 
2396 Australia's first written submission, para. 813. 
2397 Australia's reply to Panel question 54 after the second substantive meeting, para. 301. 
2398 Australia's first written submissi on, para. 813 (original emphasis). 
2399 Australia's first written submission, para. 81 2.  Australia's IRA, Part B, p. 177. WT/DS367/R 
Page 396  
 
 and there are parts of the world where apples are grown and the apple-leaf curling midge doesn't 
exist."
2400 
7.851  Australia agrees that "ALCM is a pest of cool climates".2401  In this regard, Dr Cross notes 
that: 
"In Europe, where [ALCM] seems to have reached its equilibrium position, it doesn't 
occur in the Southern European areas of S outhern Spain, in Italy South of Naples.  
Similarly, over in the United States it doesn't  occur in the more southerly areas.  I 
think the thing is that [ALCM] needs cool  temperatures, a sufficient accumulation of 
cool temperatures in winter to break diapause.  Unless diapause is broken, the emergence in spring is not synchronized properly.  In areas that don't have a sufficient 
period of cool in winter the midge cannot  exist.  I am questioning whether those 
limits have been established in Australia.  If you look at a world map of where the 
midge exists, it doesn't seem to occur in latit udes much less than about 38°.  I haven't 
investigated this thoroughly, but clearly in  these warmer areas there are not sufficient 
cool temperatures in winter and that limit has not been established in Australia by a 
climatological analysis. ... So, I am suggesting that a study needs to be done of these 
factors and it needs to be established where in Australia the climatological conditions exist for the midge based on its know n distribution throughout the world."
2402 
7.852  The same expert notes additionally that ALCM long-term survival also requires wet summer 
weather: 
"[T]he midge also needs reasonably regular summer rainfall.  Although it can clearly 
survive droughty periods for a year or two, drought conditions in summer do not 
favour it ... and it needs reasonably regular  summer rainfall in order for it to be a 
successful species and it doesn't occur in ar eas of the world that are dry.  A great 
example of this is Washington State wher e West of the Cascade Mountains, where 
there is quite a lot of rainfall, the apple-leaf  curling midge exists.  But to the East of 
that mountain range, there is an arid area where there is little summer rainfall in the 
central summer months, and the midge doesn 't exist.  Presumably, because there is 
insufficient moisture for it to complete its development."2403 
7.853  In the opinion of Dr Cross, "[ALCM] will only spread and cause a problem in areas of 
Australia where the climate is suitable for its existence".2404  The expert adds that "overall, the vast 
bulk of the territory of Australia has an unsuitable climate for apple leaf curling midge.  And it's only 
in these very southerly areas where there's ade quate rainfall, that [ALCM] poses a risk."2405 
7.854  Australia's IRA does not adequately consider the issue of the existence of climatic conditions 
necessary for establishment and spread of ALCM in  Australia and the geographic range of these 
conditions.  The IRA does not contain an analysis in  this regard, with reference to a representative 
                                                      
2400 Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 588. 
2401 Australia's first written submission, para. 821. 
2402 Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 588.  See also, reply of 
Dr Cross in Transcript of the Panel's meeting with experts, para. 650. 
2403 Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 588.  See also, Dr Cross's 
replies in Transcript of the Panel's meeting with experts, paras. 632 and 670. 
2404 Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 650. 
2405 Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 634.  Dr Cross's reply to 
Panel questions 94(v) and 117, paras. 536 and 673.  WT/DS367/R 
 Page 397 
 
 
 period of time.2406  This Panel does not have the authority to  conduct such an analysis, as this would 
amount to a de novo  exercise.  However, if a climatic analysis  were to conclude that a suitable climate 
for establishment and spread of ALCM is limite d to particular areas of Australia, this could 
presumably have a significant effect on the risk assessment.2407 
7.855  As a result, the Panel finds that the IRA's re asoning regarding the likelihood of establishment 
and spread of ALCM in Australia, in the light of  the existence of necessary climatic conditions and 
geographic range of these conditions, is not objectively justifiable. 
(f) Mode of trade 
(i) Summary of the Parties' arguments 
7.856  New Zealand argues that there is no basis for the assumptions in Australia's IRA "about the 
normal retail supply chain practices".2408  In New Zealand's view: 
"Australia failed to take into account that  the great majority of New Zealand apples 
would be exported in retail ready cond ition and so would not go to orchard 
wholesalers for re-packing.  In addition, Au stralia failed to take into account that, 
even if New Zealand apples did go to orchard wholesalers, Australian agricultural 
waste practices would preclude any opportunity for ALCM establishment."2409 
7.857  New Zealand adds that the experience of its expor ters with respect to apples shipped to other 
markets, as well as to exports of other horticultural g oods to Australia, "clearly indicate that the likely 
mode of trade for apple exports to Austra lia would be retail ready packaged fruit".2410 
7.858  According to New Zealand, because the vast majority of apples would be exported to 
Australia retail-ready, the primary pathway for AL CM establishment, apples at orchard wholesalers, 
would be "virtually eliminated".2411  "Because New Zealand apples would not require repacking, they 
would be sent directly to urban centres, which would effectively remove any likelihood of large 
numbers of apples being near enough to apples trees to  be within ALCM female flight range – a key 
prerequisite to ALCM establishment."2412 
7.859  Australia responds that, in the absence of any trade having commenced, "[n]either Australia 
nor New Zealand is in a position to specify with  any degree of precision what proportion of apples 
will be handled by different wholesalers or imported 'retail ready'."2413  In this regard, "the frequency 
that the mode of trade would be via bulk fruit as opposed to 'retail ready' fruit will depend on 
commercial considerations which will vary accordi ng to the market circumstances at any given 
time."2414  In its view, it would not be to New Zealand' s commercial advantage to limit its exports of 
                                                      
2406 Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 650.  Dr Cross's reply to 
Panel questions 94(v) and 117, in List of Replies from the scientific experts to questions posed by the Panel, 
paras. 540, 543 and 677. 
2407 Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 634. 
2408 New Zealand's second writte n submission, para. 2.251. 
2409 New Zealand's second written submission, para. 2.252.  See also, New Zealand's first written 
submission, para. 4.361-4.363. 
2410 New Zealand's reply to Panel question 9 after the second substantive meeting, para. 17.  See also, 
New Zealand's second written submission, para. 2.36-2.40. 
2411 New Zealand's second written submission, para. 2. 253;  New Zealand's opening oral statement at 
the second substantive meeting of the Pa nel with the Parties, paras. 63-64. 
2412 New Zealand's second writte n submission, para. 2.254. 
2413 Australia's reply to Panel question 53 after the second substantive meeting, para. 290. 
2414 Ibid. WT/DS367/R 
Page 398  
 
 apples to a specific form, such as "retail-ready", without regard for the particular and variable 
demands of the Australian market.
2415  According to Australia, the required use by Australia's major 
supermarket chains of their own individual packagin g in the form of returnable plastic crates would 
pose a significant challenge for New Zealand apple e xporters to limit their exports to Australia to 
"retail-ready".2416 
7.860  Australia also argues that even limiting exports to "retail-ready" apples would not ensure that 
those apples are not handled by orchard packing houses and that repacking and reconditioning of 
apples are common practices.2417 
(ii) The Panel's analysis 
7.861  With respect to this issue,  the IRA notes the following: 
"Stakeholders provided varying views on how  imported apples might be distributed.  
Some stakeholders suggested that a large proportion of apples would come in as bulk produce and be sent to orchard packing ho uses for regrading and repacking, while 
other stakeholders suggested that apples w ould be packed in market ready boxes and 
sent directly to urban wholesalers for distribution.  Two possible scenarios were 
considered in detail as follows. 
One scenario was based on 0.1%–5% of imported apples being distributed to orchard 
packing houses and the remainder (95% –99.9%) being distributed to urban 
wholesalers.  The other scenario was based on 70%–100% of imported apples being distributed to orchard packing houses and the remainder (0–30%) being distributed to 
urban wholesalers.  Estimates of the number of infested fruit were calculated by 
running a series of simulations."
2418 
7.862  Dr Cross noted that the way in which fruit is handled in Australia would have a significant 
effect on risk.  If large volumes of apples were to be packed and graded in the vicinity of apple 
orchards, and waste fruit from that process were to be disposed of or held therein, if those apples in 
turn had infested cocoons on them and a number of  midges emerged, they would have a higher chance 
of making it into the nearby apple orchards.2419  On the other hand, if fruit was held in refrigerated 
conditions, or if it was received re tail-ready and sold in small quantities to individual consumers, the 
risk would be greatly reduced.  Moreover, apple fr uit that is packed and graded ready-for-sale is 
unlikely to have green leaf material (particularly leaves of the top of the shoots, which are the ones 
that can be infested with ALCM) attached.  It is  also unlikely that the packaging itself would be 
infested with ALCM.2420  This would further reduce the risk. 
7.863  The IRA develops two different scenarios, one considering that most imported apples would 
enter in bulk and be sent to orch ard packing houses and the other considering that most apples would 
be imported in market-ready form and be sent directly to urban wholesalers.2421  Because of the 
                                                      
2415 Australia's second written submission, paras. 652 and 654. 
2416 Australia's second written submission, paras.  651-652.  See also, Australia's first written 
submission, paras. 781-783. 
2417 Australia's second written submission, para. 653. 
2418 Australia's IRA, Part B, pp. 171-172. 
2419 Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 596. 
2420 Dr Cross's reply to Panel question 98, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 575.  See also, Dr Deckers's reply to Panel question 101, in List of Replies from the 
scientific experts to questions posed by the Panel, para. 592.  See also, New Zealand's comments to experts responses, para. 155;  Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 592. 
2421 Australia's IRA, Part B, pp. 34 and 171-174.  WT/DS367/R 
 Page 399 
 
 
 impact that the way in which fruit is handled would have on risk, presumably the two distinct 
scenarios should have resulted in different estimati ons of unrestricted risk.  However, the overall 
conclusions of Australia's IRA do not transparently re flect the different level of risk that would occur 
under each scenario.2422 
7.864  As noted by Dr Cross, "[w]ith respect to AL CM, the proportion of apples shipped retail ready 
from [New Zealand] to Australia is crucial.  If all fruit were shipped as retail ready and held in a cool 
chain conditions until sold to consumers, the risk of importation, establishment and spread would be 
greatly reduced, perhaps to negligible levels."2423 
7.865  Little information is provided in the IRA on how the discussion and review of different 
factors associated with the entry, establishment and spread of ALCM is translated into quantitative 
estimates.  The Panel cannot attempt to recalcula te these estimates, as this would constitute a de novo  
review exercise.  As noted above, the IRA consid ers a first scenario, under which only 0.1 to 5 per 
cent of imported apples are distributed to orchar d packing houses, and a second scenario, under which 
70 to 100 per cent of imported apples are distributed  to orchard packing houses and the remainder to 
urban wholesalers.  As noted by Dr Cross, the fact that imported infested apples are brought in bulk to 
rural packing houses in proximity to orchards would be quite critical, as compared to retail-ready 
apples being handled at urban wholesalers. 
7.866  In conclusion, Australia's IRA does not ade quately reflect how the mode of trade of 
New Zealand apples imported into Australia was ta ken into account.  If many or most apples were 
imported from New Zealand "retail-ready", ready-pack ed in small packages, that were handled at 
urban wholesalers, as they presumably would be, this  mode of trade should have a significant effect 
on the risk assessment.2424  As noted above, the IRA considers two different scenarios, with widely 
varying proportions of imported apples being dist ributed to orchard packing houses as opposed to 
urban wholesalers.  However, consideration of the different possible modes of trade has not had any 
evident impact on the IRA's conclusions.  Again, this issue does not seem to have been adequately 
considered or transparently re flected in Australia's IRA. 
7.867  As a result, the Panel finds that the IRA's r easoning regarding the unrestricted risk for ALCM 
through the importation of New Zealand apples in Austra lia, in the light of the mode of trade of those 
apples, is not objectively justifiable. 
(g) Conclusions regarding the IRA's estimation fo r the likelihood of entry, establishment and 
spread of ALCM 
7.868  In the light of the above, the Panel concludes th at the reasoning articulated in Australia's IRA, 
with respect to the likelihood of entry, establishmen t and spread of ALCM, contains flaws which are 
enough to create reasonable doubts about the evalua tion made by the risk assessor.  The IRA has not 
properly considered a number of factors that coul d have a major impact on the assessment of this 
particular risk. 
7.869  The Panel has not found that New Zealand h as made a prima facie case regarding the 
existence of flaws in the IRA's reasoning with resp ect to the issue of whether orchards surrounding 
wholesale packing houses may be located at a distan ce that is within the flying range of ALCM. 
                                                      
2422 Australia's IRA, Part B, pp. 187-188. 
2423 Dr Cross's reply to Panel question 98, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 570.  See also, Dr Cross's reply to Panel questions 98, 101 and 121, in List of Replies 
from the scientific experts to questions posed by the Panel, paras. 574, 591 and 690;  Dr Cross's replies in Transcript of the Panel's meeting with experts, para. 662. 
2424 Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 662. WT/DS367/R 
Page 400  
 
 7.870  The IRA, however, devotes little consideration to the issue of viability of ALCM in occupied 
cocoons and does not make a rigorous attempt to dete rmine what percentage of those cocoons contain 
viable ALCM larvae or pupae.  Similarly, the IR A does not consider the impact of parasitism by 
Platygaster demades  on cocoon occupancy and viability in its est imations.  The IRA also fails to take 
into account the diminished chances of mating of ALCM due to the protracted period of emergence of 
ALCM adults relative to their short life span.  Finally, the IRA does not contain a proper analysis 
regarding the existence of the geographic range of  the necessary climatic conditions for establishment 
and spread of ALCM in Australia, nor of the likely mode of trade. 
7.871  The failure of Australia's IRA to take a ll of these factors into account is enough to 
cumulatively create reasonable doubts about the risk asse ssment with respect to its evaluation of the 
likelihood of entry, establishment and spread of ALCM.  When consulted by the Panel on the IRA's 
consideration of the issue of cocoon viability in the context of importation step 2, Dr Cross noted that, if more appropriate data was c onsidered, this would impact the whole estimation, and not only the 
upper or lower values.
2425  Similarly, if the IRA had taken the factors described in the preceding 
paragraph into account, and found that any of th em had a significant impact on the analysis, 
presumably the whole range of estimations, and not just  the upper or lower values, could have shifted.  
Due to these flaws, the IRA's r easoning in this regard cannot be found to be supported by coherent 
reasoning and sufficient scientific evidence and, in  this sense, is not objectively justifiable. 
(h) Potential biological and economic consequences associated with ALCM 
(i) Summary of the Parties' arguments 
7.872  New Zealand argues that "the IRA's analysis ov erstates the likely consequences of ALCM in 
a number of areas."2426  In New Zealand's view, "Australia's purported analysis of the 'associated 
potential biological and economic consequences' of ALCM constitutes nothing more than a listing of 
unsubstantiated assumptions.  It is not an evaluation of those consequences within the meaning of the 
SPS Agreement ."2427 
7.873  New Zealand submits in this respect that the da ta considered by the IRA to assess the impact 
of ALCM on plant life and health is outdated;  th at growers would be very unlikely to assign the same 
impact rankings to ALCM now2428;  that only in the case of young apple trees is ALCM an important 
pest for which active control methods are recommended2429;  that potential ALCM establishment in 
Australia is limited by geog raphical and climatic barriers2430;  that potential establishment of ALCM 
would not result in an increase in the use of insectic ides or a disruption of existing pest management 
programmes2431;  and that actual experience suggests that  the IRA is incorrect in anticipating 
                                                      
2425 Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 606. 
2426 New Zealand's second written submission, para. 2.768.  See also, New Zealand's second written 
submission, para. 2.784. 
2427 New Zealand's first writte n submission, para. 4.377. 
2428 New Zealand's first written submission, para. 4.3 67;  New Zealand's reply to Panel question 86 
after the first substantive meeting, para. 208.  See also, New Zealand's second written submission, paras. 2.769-
2.770. 
2429 New Zealand's first written submission, para. 4.3 68;  New Zealand's reply to Panel question 86 
after the first substantive meeting, para. 211.  See al so, New Zealand's second wr itten submission, para. 2.774. 
2430 New Zealand's first written submission, paras. 4. 369 and 4.375.  See also, New Zealand's second 
written submission, para. 2.782-2.783;  New Zealand's opening oral statement at the second substantive meeting 
of the Panel with the Parties, para. 107. 
2431 New Zealand's first written submi ssion, paras. 4.371-4.372;  New Zealand's reply to Panel question 
86 after the first substantive meeting, para. 211.  See also, New Zealand's second written submission, 
para. 2.775-2.777.  WT/DS367/R 
 Page 401 
 
 
 consequences from potential establishment of AL CM on domestic and international trade in 
apples.2432 
7.874  Australia responds that the IRA's analysis of the potential biological and economic 
consequences of an ALCM incu rsion is objective and credible.2433  In Australia's view: 
"New Zealand's challenge to the IRA Team's evaluation of the biological and 
economic consequences of an ALCM incu rsion in Australia is imprecise and 
unsubstantiated.  Once again, New Zeala nd has failed to appreciate the methodology 
used by the IRA Team to make its assessment.  New Zealand has failed to identify any evidence that the IRA Team did not ta ke into account or that there were any 
flaws in its evaluation."
2434 
7.875  Australia argues that New Zealand incorrectly relies on a paper by Rogers et al.  (2006) in 
support of a large number of its assertions in respect of ALCM consequences.2435  Australia adds that 
New Zealand does not challenge any of the "imp act scores" allocated by the IRA to potential 
consequences.2436 
7.876  More specifically, Australia contends that th e IRA took into account several sources to assess 
the impact of ALCM on plant life and health and that  New Zealand has failed to provide any evidence 
that growers would currently assign different impact rankings in respect to ALCM compared to those 
ascertained earlier2437;  that the IRA Team primarily focu ssed on potential consequences for young 
trees2438;  that New Zealand has failed to provide an y evidence or argument to suggest that ALCM 
would not become a major problem in Austra lian orchards should it become established2439;  that the 
consequences analysis for ALCM in the IRA cons idered that potential con sequences would only have 
regional and local, and not national, significance2440;  that it is inappropriate to draw a direct analogy 
between New Zealand's current and well-established practices for managing ALCM, and the management practices that may have to be newly im plemented in Australia if ALCM was to establish, 
as invasive species do not necessarily behave in the same way when they are introduced to different 
parts of the world
2441;  that it was not possible for the IRA to assess the degree to which potential 
predators of ALCM present in Australia would ef fectively contribute to the biological control of 
ALCM under Australian conditions2442;  that, in considering the consequences from potential 
establishment of ALCM on international trade in appl es, New Zealand has not specified the nature of 
the "sensitivity" of other markets to ALCM, or how New Zealand addresses those sensitivities.2443 
                                                      
2432 New Zealand's first written submission, paras. 4.374-4.376.  See also, New Zealand's second 
written submission, para. 2.778-2.781. 
2433 Australia's first written submission, paras. 825-850. 
2434 Australia's first written submission, para. 850. 
2435 Australia's first written submission, para. 827. 
2436 Australia's first written submission, para. 828. 
2437 Australia's first written submission, paras. 829-832. 
2438 Australia's first written submission, para. 833. 
2439 Australia's first written submission, para. 834. 
2440 Australia's first written submission, paras. 835-837. 
2441 Australia's first written submission, paras. 840-842. 
2442 Australia's first written submission, paras. 843-846. 
2443 Australia's first written submission, paras. 847-849. WT/DS367/R 
Page 402  
 
 (ii) The Panel's analysis 
7.877  Australia's IRA contains a qualitative evalua tion of the potential biological and economic 
consequences associated with the entry, est ablishment or spread of the relevant pests.
2444  A s  
described in the IRA: 
"The impact of a pest or disease on each direct and indirect consequence criterion is 
estimated at four levels – local, district, regional and national – and the values derived 
are translated into a single qualitative score, A–G (Table 10) ... 
At each level, the quantum of impact is d escribed as 'unlikely to be discernible', of 
'minor significance', 'significant' or 'highly significant'."2445 
7.878  Based on the impact scores assigned to different criteria (namely, plant life or health, human 
life or health, other aspects of the environment, control or eradication, domestic trade or industry, 
international trade, environment, and communities) , the IRA estimates the overall consequences of 
ALCM as being "low".  By combining the value fo r the annual probability of entry, establishment and 
spread and the outcome of overall consequences, th e IRA estimates that the unrestricted annual risk 
for imported apples from New Zealand is "low".  This  rating of "low" is above Australia's ALOP of 
"very low".  Accordingly, the IRA concludes that  "risk management woul d be required for this 
pest".2446 
7.879  Consulted by the Panel, Dr Cross noted that: 
"[S]ome of the terms used [in Australia's methodology for assessing impacts] are 
relativistic and are not clearly defined.  In Table 10 [of the IRA on 'Assessment of 
local, district, regional and national conse quences], much rides on the differences 
between 'minor', 'significant' and 'highly significant' but the differences between these 
impacts is not defined in terms of economi c loss, the need to apply insecticides or 
social consequences."2447 
7.880  Dr Deckers noted that "[in Europe, the] problem of an ALCM infection in an apple orchard is 
not considered ... as a major problem, but more as a secondary parasite that makes some damage on 
the leaves without interfering too much with the productivity of the fruit trees."2448 
7.881  Dr Cross expressed the view that the IRA may have overestimated the assignment of certain 
impact scores.  On the direct impact on plant life or  health, the IRA assigned an impact score of "D".  
While this impact score is "credible", the expert not ed that a less-serious impact score of "C" (district 
level – minor;  local level – signifi cant) "would be more appropriate".2449  Likewise, the impact score 
of "D" for the indirect impact on control or erad ication is considered "somewhat severe" and a "C" 
score "would be more objective and credible".2450  Dr Cross found that the IRA score for domestic 
trade or industry, international trade, the environment and communities are "credible and 
                                                      
2444 See para. 2.63 above. 
2445 Australia's IRA, Part B, p. 38. 
2446 Australia's IRA, Part B, p. 187. 
2447 Dr Cross's reply to Panel question 96, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 556. 
2448 Dr Deckers's reply to Panel question 96, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 563. 
2449 Dr Cross's reply to Panel question 96, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 556. 
2450 Dr Cross's reply to Panel question 96, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 559.  WT/DS367/R 
 Page 403 
 
 
 objective".2451  The expert questioned, however, the IRA's discussion on the possible effects of ALCM 
infestation on skin finish and fruit quality.  The expert  noted that such effects "are rare".  "The type of 
damage reported from New Zealand has not been reported elsewhere and is extraordinary."2452 
7.882  It is not the Panel's role to reassess the imp act scores assigned by the IRA to specific criteria 
and propose different scores.  In any event, most  of New Zealand's arguments with respect to the 
IRA's estimation of consequences assume that ALCM would behave in the same way if introduced in 
Australia as has been observed in other regions.  As noted by Australia, "invasive species do not necessarily behave in the same wa y when they are introduced to different parts of the world".
2453 
7.883  It must be noted, however, that the IRA has a tendency to overestimate the severity of ALCM 
consequences in certain aspects.  This overestimatio n affects in particular the four scores that in the 
IRA are assigned the harshest score of "D" (plant lif e or health, control or eradication, domestic trade 
or industry and international trade). 
7.884  Moreover, the Panel has already noted that Aust ralia's IRA does not adequately consider the 
issue of the geographic range and the existence of  climatic conditions necessary for establishment and 
spread of ALCM in Australia.  As stated by Ne w Zealand, potential ALCM establishment in Australia 
can be limited by geographical and climatic barriers.   This calls into question the IRA's conclusions 
regarding the potential biological and economi c consequences associated with the entry, 
establishment or spread of ALCM into Australia. 
7.885  In the light of the above, the Panel concludes that the IRA's evaluation of the potential 
consequences associated with the en try, establishment or spread of AL CM into Australia does not rely 
on adequate scientific evidence and, accordi ngly, is not coherent and objective. 
(i) Overall conclusions with respect to requirements regarding ALCM 
7.886  For the reasons stated above, the Panel finds that, with respect to its analysis of the likelihood 
of entry, establishment and spread of ALCM, and of the potential consequences associated with the 
entry, establishment or spread of ALCM into Australia, Australia's IRA is not a proper risk 
assessment within the meaning of Article 5.1 and paragraph 4 of Annex A of the SPS Agreement.  
The flaws described above also constitute a failure by the IRA to adequately take into account factors 
such as the available scientific evidence, th e relevant processes and production methods in 
New Zealand and Australia, the actual prevalence of viable ALCM, and re levant environmental 
conditions, as required by Article 5.2 of the SPS Agreement. 
7.887  Accordingly, Australia's inspection and treatment requirements regarding ALCM on 
New Zealand apples are inconsistent with Article s 5.1 and 5.2 of the SPS Agreement.  Since the 
requirements are not based on a risk assessment as  provided in Article 5.1 of the SPS Agreement, 
these measures can be presumed, more generally, not to be based on scientific principles or not to be maintained with sufficient scientific evidence within the meaning of Article 2.2.
2454  Accordingly, the 
Panel finds that Australia's inspection and treat ment requirements regarding ALCM on New Zealand 
apples are, by implication, also inconsistent  with Article 2.2 of the SPS Agreement. 
                                                      
2451 Dr Cross's reply to Panel question 96, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 560. 
2452 Ibid. 
2453 Australia's first written submission, para. 840.  See also, Reply of Dr Cross to Panel question 119, 
para. 676. 
2454 Appellate Body Report on Australia – Salmon , paras. 137-138. WT/DS367/R 
Page 404  
 
 7. General measures 
(i) Summary of the Parties' arguments 
7.888  In addition to specific requirements regardi ng fire blight, European canker and apple 
leafcurling midge, New Zealand challenges three requirements, which it has defined as "general" 
measures: 
• "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. 
• The requirement that New Zealand ensure  that all orchards registered for 
export to Australia operate under standard commercial practices. 
• The requirement that packing houses provide details of the layout of 
premises."
2455 
7.889  New Zealand argues that, with respect to these me asures, too, Australia has failed to comply 
with its obligations under Artic le 2.2 of the SPS Agreement.2456  These measures would also be 
inconsistent with the requirement in Article 2.2 th at they be based on scientific principles and applied 
only to the extent necessary to protect human, animal or plant life or health.2457  In New Zealand's 
view: 
"Since mature, symptomless apple fruit are not a pathway for fire blight or European 
canker to be transmitted to Australia, and since there is no scientific evidence that 
entry, establishment and spread of ALCM could occur at the levels of infestation 
reported on New Zealand apples, there is also insufficient scientific evidence for Australia to maintain its additional me asures applicable to all three pests".
2458 
7.890  New Zealand submits that there is no justifica tion in the IRA for the requirement that AQIS 
officers be involved in orchard inspections for Europ ean canker and fire blight, in direct verification 
of packing house procedures, and in fruit inspection and treatment.  According to New Zealand, 
because there is no justification for requiring any of these inspections or packing house procedures, 
and these requirements are in breach of Article 2.2 of the SPS Agreement, there is also no justification 
for requiring AQIS staff to be involved in orchard inspections, packing house inspections, or in fruit 
inspection or treatment.2459 
7.891  New Zealand adds that, although New Zealand apples are processed according to standard 
commercial practices, there is no justification to require, through a costly program, verification of 
                                                      
2455 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A-1 to this report, p.  3.  See also, Australia's IRA, Part B, pp. 150-155. 
2456 New Zealand's first written s ubmission, paras. 4.141-4.150. 
2457 New Zealand's first written submission, para. 4. 150.  See also, New Z ealand's second written 
submission, para. 2.272. 
2458 New Zealand's first writte n submission, para. 4.141. 
2459 New Zealand's first written submission, paras. 4.142-4.144.  See also, New Zealand's second 
written submission, paras. 2.275-2.278.  WT/DS367/R 
 Page 405 
 
 
 such compliance by New Zealand.  According to New Zealand, Australia does not even attempt to 
demonstrate any scientific support for this measure.2460 
7.892  New Zealand also argues that Australia does not  attempt to demonstrate any scientific support 
for the requirement that packing houses provide deta ils of the layout of premises.  In New Zealand's 
view, it is not clear how this measure can be ju stified, nor what risk is it intended to address.2461 
7.893  New Zealand adds that these three measures also  breach Article 5.1 of the SPS Agreement, 
because the IRA fails to comply with the requir ement to evaluate the likelihood of entry, 
establishment and spread of the relevant pests,  according to the SPS measures which might be 
applied.2462 
7.894  In response, Australia argues that the three "g eneral" measures identified by New Zealand are 
"ancillary measures", which "do not fall within the definition of SPS measure in Annex A(1) of the 
SPS Agreement".2463  They would constitute "general operational procedures to support the principal 
risk management measures for the quara ntine risks identified in [the IRA]".2464  Australia submits that 
"none of these requirements operate in a concrete  way in its own right, and therefore cannot be 
challenged on an individual basis.  Accordingl y, the Panel should only assess these requirements 
when 'taken together' (o r, 'as a whole') with the principal risk management measures recommended in 
the Final IRA Report."2465 
7.895  Australia adds that a panel need onl y examine the measures "which actively reduce  the risks 
of concern  – i.e. the principal risk reduction measures"  and not "those measures which do not actually 
reduce  the risks themselves, but are required simply to  support, verify and operationalise the principal 
risk reduction measures."2466  Australia submits that it "has demonstrated that its principal risk 
reduction requirements are supported by sufficient scientific evidence".  Australia adds that 
"New Zealand has adduced no evidence to suggest that the ancillary requirements are not valid 
requirements for ensuring verification and support of the principal measures."  Therefore, there would 
be "no basis for finding the ancillary requirem ents are not supported by sufficient scientific 
evidence."2467  Australia concludes that the "general" measu res are consistent with articles 5.1, 5.2 and 
2.2 of the SPS Agreement.2468 
7.896  The Parties differ as to the exact scope of  the three "general" measures identified by 
New Zealand.2469  Most especially, they differ as to the exact scope of the requirement of AQIS 
                                                      
2460 New Zealand's first written submission, paras. 4.145-4.148.  See also, New Zealand's second 
written submission, paras. 2.286-2.290. 
2461 New Zealand's first written submission, para. 4. 149.  See also, New Z ealand's second written 
submission, paras. 2.279-2.285. 
2462 New Zealand's first written s ubmission, paras. 4.400-4.401. 
2463 Australia's second written submission, para. 714.  See also, Australia's first written submission, 
para. 145.  See also, Australia's reply to Panel questions 14 and 15 after the first substantive meeting. 
2464 Australia's first written submission, para. 145. 
2465 Australia's first written submission, para. 146.  See also, Australia's reply to Panel questions 12 
and 17 after the first substantive meeting. 
2466 Australia's first written submission, para. 859 (ori ginal emphasis).  See also, Australia's first written 
submission, paras. 868-869. 
2467 Australia's first written submission, para. 959.  See also, Australia's first written submission, 
paras. 962-969;  Australia's second written submission, paras. 715-729. 
2468 Australia's second written submission, paras. 730-735. 
2469 See paras. 2.170 to 2.198 above. WT/DS367/R 
Page 406  
 
 involvement.  As noted by Australia, "[t]he extent  and precise nature of 'AQIS involvement' was not 
defined in the Final IRA Report."
2470  Australia adds, however, that this requirement: 
"[D]oes not require the involvement of AQIS officials in all orchard inspections and 
packing house operations.  Rather, AQIS activities are to be by way of systems audits.
2471  For orchard inspections, the audit would include 100% of survey teams in 
the field, and the intensity of audits would be adjusted over time based on 
performance.  For packing houses, all releva nt packing houses would be audited in 
their first year of trade."2472 
7.897  New Zealand responds that the AQIS involveme nt for New Zealand apples, which involves 
the audit of 100 per cent of survey teams and packi ng houses, "differs in scope  and intensity from any 
form of systems audit familiar to New Zealand, or indeed Australia."2473  According to New Zealand, 
this requirement is different to the one impos ed for stone fruit from New Zealand to Western 
Australia, imposed only for the first season of trade and involving only a sample of growers and packing houses.
2474  New Zealand also rejects Australia's link of the AQIS involvement requirement 
with standard pre-clearance arrangements.  Under the IRA's requirement, AQIS officers would 
undertake audits of survey teams and packing hous es while they are in New Zealand.  New Zealand 
submits that audits of survey teams would not ta ke place at the same time as pre-clearance.  For 
example, in the case of fire blight and European canker, orchard inspections would take place long 
after or well before the export of apples to Australia  would have occurred.  This would differ to what 
pre-clearance generally entails, that the usua l on-arrival verification requirements would be 
undertaken outside Australia.2475 
(ii) The Panel's analysis 
7.898  The Panel has already concluded that each of  the 16 measures at issue constitutes an SPS 
measure, within the meaning of Annex A(1) of the SPS Agreement.2476  The Panel has also concluded 
that it is not prevented from analyzing the challe nged measures either individually or as a whole.2477  
In the circumstances of the present case, a distinc tion between principal and ancillary measures would 
not limit the Panel to considering any of the measure s, and in particular the "general" measures, only 
in conjunction with a "principal" risk management measure. 
7.899  Notwithstanding the disagreement between the Par ties as to the exact scope of the "general" 
measures, and most especially of the requirement of AQIS involvement, is is undisputed that these measures are, by their purpose, form and nature, li nked to the specific measures regarding the pests at 
issue in the current dispute.
2478  There is no discussion in the IR A of scientific evidence that would 
support these "general" measures;  indeed, there is no  attempt to provide any separate justification for 
these measures. 
                                                      
2470 Australia's first written submission, para. 151. 
2471 (footnote original ) This is explained in the Final IRA Report as follows:  "AQIS field audits will 
measure compliance with orchard registration, block identification, pest/disease management/monitoring, 
records management, and the administration of the area freedom and accreditation requirements." (Final IRA 
Report, Part B, p. 314.) 
2472 Australia's first written submission, para. 151. 
2473 New Zealand's second writte n submission, para. 2.276. 
2474 Ibid. 
2475 New Zealand's second written submission, paras.  2.277.  See also, Australia's reply to Panel 
question 47 after the first substantive meeting. 
2476 See para. 7.172 above. 
2477 Ibid. 
2478 See paras. 2.92-2.95 above.  WT/DS367/R 
 Page 407 
 
 
 7.900  The IRA introduces the section where these three measures are described explaining that the 
section provides details "on the recommended quaran tine conditions ... and operational procedures 
required to manage the quarantine risks".2479 
7.901  In the case of the requirement of AQIS involvement, Australia notes that: 
"[T]he AQIS audits of orchard inspections  and packing house procedures serve to 
verify that the principal orchard inspecti on and disinfection measures for fire blight 
and European canker are appropriately fu lfilled.  Verification of fruit inspection 
processes is aimed at ensuring the appropriate level of efficacy is achieved for the principal fruit inspection requirements for ALCM, as well as the more general fruit inspection requirements."
2480 
7.902  The requirement that packing houses provide details of the layout of premises is linked to the 
requirement of AQIS involvement in orchard insp ections and packing house procedures.  Indeed, 
Australia notes that "[t]his measure is ancillary to the aforementioned requirement, in that it is 
designed to facilitate AQIS verification of packing house procedures."2481 
7.903  Finally, the requirement that New Zealand ensure  that all orchards registered for export to 
Australia operate under standard co mmercial practices is again linke d to the measures regarding the 
pests at issue in the current dispute.  In Australia 's words, "[t]his measure is an ancillary measure, on 
the basis that the assumption that orchards wi ll operate under standard  commercial practices 
underpins all the risk management measures recommended in the Final IRA Report, including all the 
principal measures at issue in this dispute, and hence it is ancillary to them."2482 
7.904  The Panel has already found that Australia's requirements regarding fire blight, European 
canker and ALCM are inconsistent with Articles 5.1,  5.2 and 2.2 of the SPS Agreement.  Considering 
the link in the IRA between the "general" meas ures identified by New Zealand and the specific 
requirements regarding fire blight, European canke r and ALCM, as well as the lack of any separate 
justification for these "general" measures in the IRA,  the Panel must conclude that with respect to 
these "general" measures, too, Australia's IRA is not a proper risk assessment within the meaning of 
Article 5.1 and paragraph 4 of Annex A of the SPS Ag reement.  In imposing these "general" measures 
the IRA has failed to take into account factors such  as the available scientific  evidence, the relevant 
processes and production methods in New Zealand a nd Australia, and the actual prevalence of fire 
blight, European canker, and relevant environmenta l conditions for ALCM, as required by Article 5.2 
of the SPS Agreement. 
7.905  Accordingly, Australia's "general" measures on New Zealand apples are inconsistent with 
Articles 5.1 and 5.2 of the SPS Agreement.  Because the requirements are not based on a risk 
assessment as provided in Article 5.1 of the SPS Agreement, these measures can be presumed, more 
generally, not to be based on scientific prin ciples within the meaning of Article 2.2.2483  The Panel 
finds that Australia's "general" measures on New Zeala nd apples are, by implication, also inconsistent 
with Article 2.2 of the SPS Agreement. 
                                                      
2479 Australia's IRA, Part B, p. 313. 
2480 Australia's reply to Panel question 15 after the first substantive meeting. 
2481 Ibid. 
2482 Ibid. 
2483 Appellate Body Report on Australia – Salmon , paras. 137-138. WT/DS367/R 
Page 408  
 
 8. General conclusion on New Zealand's claims  under Articles 5.1, 5.2 and 2.2 of the 
SPS Agreement 
7.906  For the reasons stated above, the Panel has found that Australia's requirements regarding fire 
blight, European canker and ALCM, as well as th e 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, 5.2 and 2.2 of the SPS Agreement. 
D. N
EW ZEALAND 'S CLAIM UNDER ARTICLE  5.5 OF THE SPS  AGREEMENT  
1. Introduction 
7.907  In its panel request, New Zealand claims a viola tion of the "first sentence" of Article 5.5 of 
the SPS Agreement2484, which reads: 
"With the objective of achieving consistency in the application of the concept of 
appropriate level of sanitary or phytosanitary  protection against risks to human life or 
health, or to animal and plant life or h ealth, each Member shall avoid arbitrary or 
unjustifiable distinctions in the levels it considers to be appr opriate in different 
situations, if such distinctions result in discrimination or a disguised restriction on 
international trade." 
7.908  New Zealand notes that, in the light of the Appellate Body report in EC – Hormones , 
three elements need to be demonstrated  to show a breach of this provision: 
"First, that the Member imposing the meas ure complained of has adopted its own 
appropriate levels of sanitary protection ag ainst risks to human life or health in 
several different situations. 
Second, that those levels of protection exhi bit arbitrary or unjustifiable differences 
('distinctions' in the language of Article 5.5)  in their treatment of different situations. 
Third, that the arbitrary or unjustifiable differences result in discrimination or a 
disguised restriction on international trade.2485"2486 
7.909  New Zealand argues that all three elements are fulfilled.2487  Australia has imposed measures 
to New Zealand apples that it does not impose in ci rcumstances of comparable risk, as illustrated by 
the way Australia has treated the im portation of nashi pears from Japan.2488  In particular, 
New Zealand compares Australia's appropriate leve l of protection (ALOP) for New Zealand apples in 
respect to fire blight ( Erwinia amylovora ) and European canker ( Neonectria galligena ) with 
Australia's ALOP for Japanese nashi pears in regard to Japanese Erwinia  and brown rot ( Monilinia 
fructigena ), respectively.  According to New Zealand, these situations are comparable, the levels of 
                                                      
2484 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Anne x A-1 to this report, p. 3. 
2485 (footnote original ) Appellate Body Report, EC – Hormones , paras. 214-215 .  See also Appellate 
Body Report, Australia – Salmon , para.140;  and the SPS Committee's Guidelines to further the practical 
implementation of Article 5.5  (G/SPS/15) adopted at its meeting of 21-22 June 2000, para. 4.2. 
2486 New Zealand's first writte n submission, para. 4.432. 
2487 New Zealand's first written submission, para. 4. 433.  See also New Zealand's opening oral 
statement at the first substantive meeting of the Panel w ith the Parties, para. 116;  and New Zealand's second 
written submission, para. 2.817. 
2488 New Zealand's closing oral statement at the s econd substantive meeting of the Panel with the 
Parties, para. 13.  WT/DS367/R 
 Page 409 
 
 
 protection applied show arbitrary or unjustified distinctions, and these distinctions result in 
discrimination or a disguised restriction on trade.2489 
7.910  Australia rejects New Zeal and's claim and arguments under Article 5.5 as "flawed"2490 and 
"lack[ing] merit."2491  Quoting the Appellate Body Report on EC – Hormones , Australia argues that 
the first clause of Article 5.5 of the SPS Agreemen t sets out the objective of  achieving consistency in 
the application of the concept of ALOP.  This objective itself would not impose any legal obligation 
on Members.  The Appellate Body recognized in EC – Hormones  that this objective does not set a 
goal of achieving absolute or perfect consiste ncy in ALOP, since governments establish their 
appropriate levels of protection fre quently on an ad hoc basis and over time, as different risks present 
themselves at different times.  It is only arbitrar y or unjustifiable inconsistencies that are to be 
avoided.2492 
7.911  Like New Zealand, Australia identifies three el ements that need to be demonstrated for a 
finding of inconsistency with Article 5.5 of the SPS Ag reement.  At the same time, Australia refers to 
a part of the Appellate Body report in  Australia – Salmon , which shows certain differences with the 
Appellate Body report in EC – Hormones  as regards the first and second elements: 
"– the Member concerned adopts differe nt appropriate levels of sanitary 
protection in several 'different situations'; 
– those levels of protection exhibit differences which are 'arbitrary or 
unjustifiable'; and 
– the measure embodying those differences results in 'discrimination or a 
disguised restriction on international trade'.2493"2494 
Australia emphasizes that these three elements are cu mulative, so New Zealand is required to show 
that all three elements are present.2495 
7.912  In addressing New Zealand's Article 5.5 claim,  the Panel will follow the approach of the 
Appellate Body and panels in previous  disputes involving Article 5.5 claims.2496  As also argued by 
the Parties, this approach is based on a three-pr onged test applied to the second part of the first 
sentence of Article 5.5.  In applying the test, th e Panel will also address the apparent differences 
between the Appellate Body reports in identifying  the first and second elements in the test.  But 
before turning to the three limbs of the substan tive test under Article 5.5, the Panel will address a 
threshold issue raised by Australia in regard  to New Zealand's claim under this provision.  
                                                      
2489 New Zealand's second written s ubmission, para. 2.817.  See al so New Zealand's opening oral 
statement at the first substantive meeting of the Panel with the Parties, para. 116. 
2490 Australia's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 56. 
2491 Australia's closing oral statement at the first su bstantive meeting of the Panel with the Parties, 
paras. 35-36. 
2492 Australia's first written submission, para. 974. 
2493 (footnote original ) Appellate Body Report, Australia – Salmon , para. 140. 
2494 Australia's first written submission, para. 975. 
2495 Australia's first written submission, para. 976. 
2496 See the panel and Appellate Body reports on EC – Hormones  and Australia – Salmon , and the 
panel report on Australia – Salmon (Article 21.5 – Canada) . WT/DS367/R 
Page 410  
 
 2. Threshold issue raised by Australia 
7.913  New Zealand's Article 5.5 claim is based on a comparison of the ALOP and measures applied 
by Australia to fire blight ( Erwinia amylovora ) and European canker ( Neonectria galligena ) in 
New Zealand apples, and to Japanese Erwinia  and brown rot ( Monilinia fructigena ) in Japanese nashi 
pears.  Australia raises a threshold issue in regard  to this claim.  Australia argues that, because 
New Zealand did not identify Japanese nashi pears as the comparator product until its first written 
submission, due process was prejudiced and the prep aration of Australia's defence was negatively 
affected.
2497  Since New Zealand merely listed Article 5.5 in its panel request, Australia had only four 
weeks to address New Zealand's arguments in its fi rst written submission.  Australia is not arguing 
that New Zealand should have elaborated its argume nts on Article 5.5 in its panel request.  Rather, 
New Zealand should have properly outlined its clai ms under this provision so that Australia could 
have commenced preparation of its defence before receiving New Zealand's first written 
submission.2498 
7.914  New Zealand rejects the threshold issue rais ed by Australia.  In New Zealand's view, 
the question of the sufficiency of New Zealand' s panel request was dealt with by the Panel's 
preliminary ruling of June 2008.  The comparator situation of nashi pears imported from Japan was 
identified by Australia in the 1998 Final IRA Report fo r New Zealand apples.  It should have come as 
no surprise to Australia that New Zealand would di scuss a comparison that had already been made by 
the IRA Team.  Further, in proving a breach of Article 5.5, the complainant faces particular 
challenges.  It must piece together information on comparator situations dr awing on publicly available 
sources, without having ready access – like the re spondent – to all info rmation concerning SPS 
measures imposed by the respondent on goods from th ird countries.  New Zealand adds that, at the 
October 2007 consultations in this dispute, Au stralia did not ask New Zealand to indicate the 
comparator situations it had in mind in identify ing a breach of Article 5.5 in its request for 
consultations.2499 
7.915  In response, Australia recogni zes that Japanese nashi pears we re briefly mentioned in the 
1998 Final IRA Report for New Zealand apples.  Howe ver, as also noted in that Report, there are 
significant differences between Japanese nashi pear s and New Zealand apples.  In contrast to 
New Zealand apples, Japanese nashi pears involve a very low volume of fruit, risk management is 
based on a robust area freedom arrangement, and a stringent eradication programme is in place in 
Japan.  Accordingly, it is unreasonable to expect Australia to know that nashi pears from Japan would 
be the comparator situation ten years later in this dispute.2500  In any event, it was Australia and not 
New Zealand that identified the i ssue of nashi pears in the 1998 IRA;  New Zealand has not submitted 
evidence showing that it raised this issue in 1998 in any claim of discrimination.2501 
7.916  Australia confirms that the consultations of  October 2007 did not address the comparison of 
New Zealand apples with Japanese nashi pears in the context of New Zealand's Article 5.5 claim.2502  
It is unclear why New Zealand did not  raise this at the consultations.2503  A s  c o m p l a i n a n t ,  
New Zealand has the onus to ensure through its pa nel request that Australia, the respondent, fully 
comprehend the nature of the case it has to answer.  It is not the respondent's role to seek further 
                                                      
2497 Australia's first written submission, para. 973.  See also Australia's second written submission, 
paras. 163-165. 
2498 Australia's reply to Panel question 128 after the first substantive meeting.  See also Australia's 
second written submission, para. 170. 
2499 New Zealand's reply to Panel question 129  after the first substantive meeting. 
2500 Australia's reply to Panel question 128 after the first substantive meeting. 
2501 Australia's second written submission, para. 170. 
2502 Australia's reply to Panel question 128 after the first substantive meeting. See also Australia's 
second written submission, para. 166. 
2503 Australia's second written submission, para. 167.  WT/DS367/R 
 Page 411 
 
 
 information from a complainant as to the nature of  its claims, and there is no mechanism in the DSU 
to do so.2504 
7.917  The Panel recalls that Australia advanced simila r arguments in the context of its first request 
for a preliminary ruling by the Panel under Article 6.2 of the DSU.  At that time, Australia was 
complaining that it would be forced to wait until Ne w Zealand's first written submission to learn about 
the product of comparison: 
"There is a further aspect to Australia's claim that the mere listing of the provisions 
alleged to have been violat ed is completely inadequate in this case, inhibiting the 
preparation of Australia's defence.  This aspect relates to New Zealand's claims under 
Article 2.3 and Article 5.5 of the SPS Agreement .  Both of these provisions require 
comparisons to be made between measures adopted by a Member in different 
situations in order to subs tantiate claims of discrimination or the imposition of 
disguised restrictions on international trade.  As such, Australia submits that in order 
to prepare its defence to claims under Article  2.3 and Article 5.5, it requires notice of 
which measures specified in the Final IRA Report are the subject of these claims and, 
equally importantly, which of Australia's  other SPS measures are being used by 
New Zealand as points of comparison with the measures in the Final IRA Report.   
Australia applies a range of SPS measures in  relation to different products from many 
WTO Members.  New Zealand's failure to identify in  its panel request which of those 
measures it seeks to compare with the measu res in the Final IRA Report, in order to 
substantiate its claims under Article 2.3 and  Article 5.5, means that Australia is 
forced to wait to receive New Zealand's first written submission to identify the basis 
of its claims under those provisions.  Without such information, Australia is not able to commence preparation of its defence in relation to these provisions on the basis of 
the panel request.  Australia submits that such an outcome cannot be consonant with 
due process.  Australia is not arguing t hat New Zealand should have elaborated its 
arguments on Article 2.3 and Article 5.5 in its panel request.  Australia is arguing 
that New Zealand should have properly outlined its claims under those provisions so that Australia could commence prepara tion of its defence before receiving 
New Zealand's first written submission. "
2505 
7.918  Likewise, in its rebuttal submission on the same  preliminary issue, Australia argued that: 
"For the statement of a particular legal clai m to be sufficient to meet the requirements 
of Article 6.2 of the DSU, that statem ent must, at a minimum, provide enough 
information so that a respondent can 'begin  preparing its defence at the beginning of 
the panel process.'2506  Applying this principle to Article 2.3 and Article 5.5, 
New Zealand should at least have identified the basis of comparison  that it relies 
upon in asserting a violation in its panel request.  The element of comparison is 
central to both provisions. 
Under the first sentence of Article 2.3, for example, a hypothetical 'claim' might be 
that certain SPS measures discriminate between Member A and Member B.  An 'argument' in support of this claim might  be that Australia has given preferential 
treatment to Member A's market access request over a similar request made by Member B.  Where the obligations in a provision turn on a comparison of certain 
                                                     
 
2504 Australia's second written submission, para. 168. 
2505 Australia's first request for a preliminary ruling,  13 March 2008, paras. 55-56 (emphasis added). 
2506 (footnote original ) Panel Report, Japan – DRAMs (Korea) , para. 7.9. WT/DS367/R 
Page 412  
 
 treatment in different situations, for ex ample between Member A and Member B, 
then a claim under that provision is only partially stated if Member A and not Member B is identified.  It is not possibl e for Australia to commence preparation of 
its defence under either Article 2.3 or Article 5.5 without knowing the bases for 
comparison that New Zealand considers relevant."
2507 
7.919  In its preliminary ruling relating to Article 6.2 of the DSU the Panel has already addressed 
these arguments, including whether due process would be prejudiced by New Zealand identifying the comparator product for its Article 5.5 claim only in its first written submission: 
"... [T]he Panel notes that it is not convinced by Australia's arguments that the lack of 
a more detailed explanation as to how or why the 17 specifically listed measures at 
issue are considered by New Zealand to be violating the provisions invoked has 
prejudiced or will prejudice Australia's ability to defend itself in the course of the Panel's proceedings. 
Accordingly, the Panel finds that New Zeal and's panel request does not fail to provide 
a brief summary of the legal basis of its co mplaint, which is sufficient to present the 
problem clearly, as required by Article 6.2 of the DSU."
2508 
7.920  The Panel concluded in its preliminary ruling that "New Zealand's panel request contains 
sufficient information regarding the legal basis of the complaint to present the problem clearly with 
respect to the 17 identified items."2509  Further, "the Panel ... allow[ed] this proceeding to continue 
with respect to the 17 measures specifically identif ied in New Zealand's panel request and to the 
alleged inconsistency of such measures with th e provisions of the SPS Agreement cited therein", 
including Article 5.5.2510 
7.921  As New Zealand argues, the Panel's prelimin ary ruling has already addressed the threshold 
issue raised by Australia in the context of New Z ealand's Article 5.5 claim.  There is no need to 
modify this preliminary ruling.  Nevertheless, in line with the explicit reservation in the preliminary 
ruling2511, the Panel intends to further develop the reas ons for its ruling in the light of Australia's 
subsequent arguments. 
7.922  The Panel addressed the threshold issue raised by Australia in the context of New Zealand's 
Article 5.5 claim, in the part of its preliminar y ruling, dealing with whether New Zealand's panel 
request provides a brief summary of the legal basis of  its complaint, as required by Article 6.2 of the 
DSU.  First, the Panel held that New Zealand's panel request laid out a connection between each of 
the challenged measures and the specific provi sions invoked, including Article 5.5 of the 
SPS Agreement: 
"In its panel request, New Zealand has liste d a number of provisions of the covered 
agreements, which it alleges are breached by the measures adopted by Australia.  
New Zealand has not drawn an explicit a nd detailed connection between the specific 
                                                      
2507 Written submission of Australia in response to New Zealand's submission on Australia's first 
request for a preliminary ruling, 14 April 2008, paras. 34-35 (original emphasis). 
2508 Australia – Apples , Communication From the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, paras. 11-12. 
2509 Australia – Apples , Communication From the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, para. 13(a). 
2510 Australia – Apples , Communication From the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, para. 14. 
2511 Australia – Apples , Communication From the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, p. 1.  WT/DS367/R 
 Page 413 
 
 
 measures challenged and the provisions invoked.  New Zealand has only stated in 
general terms that 'the above measures ar e inconsistent with the obligations of 
Australia under [nine provisions of the Agre ement on the Application of Sanitary and 
Phytosanitary Measures, (SPS Agreement)]'.2512  Having carefully considered the 
language used in the panel request and the specific content of the provisions of the 
SPS Agreement cited therein, the Panel unde rstands that New Zealand has claimed 
that 'every measure ... [identified] in its pa nel request is inconsistent with each of the 
[nine] provisions referred to [in the panel request].'2513  In the Panel's view, this 
satisfies the requirement that the panel request lays out a connection between the various measures challenged and the specific provisions invoked.
2514"2515 
7.923  The Panel's preliminary ruling then turned to whether New Zealand's panel request provides a 
brief summary of the legal basis of the complaint th at is sufficient to present the problem clearly.  
At the outset of this analysis, the Panel noted that  it "would ideally have preferred a more explicit 
explanation of how or why the measures at issue are considered by New Zealand to be violating the 
identified provisions of the SPS Agreement."2516 
7.924  Disputes under the SPS Agreement, in particular  disputes involving more than one pest, 
disease or product, tend to be particularly comple x and require considerable preparation by both 
parties and panels.  It would certainly be he lpful if complainants making claims under the 
SPS Agreement specified as much deta il as possible in their panel request to allow more time for the 
defendant to prepare its defence.  The Panel does not agree with New Zealand that the complainant 
faces particular challenges under Article 5.5 of th e SPS Agreement.  At the same time, the Panel 
believes that where the complainan t makes claims under provisions of  the SPS Agreement that require 
a comparison of the situation at issue in the disput e with other situations, such as Article 5.5, it would 
be particularly helpful if complainants specified  the situation that was to serve as the basis of 
comparison. 
7.925  However, it is important to bear in mind that the latter situation only serves as a basis of 
comparison.  Strictly speaking, it is not at issue in  the dispute.  In the current dispute, and in the 
context of its Article 5.5 claim, New Zealand contests the 17 Australian measures at issue and the de 
facto  ALOP reflected in these measures, in regard to New Zealand apples.  New Zealand does not 
claim any inconsistency of Australia's ALOP for Jap anese nashi pears, nor of any measures applied by 
Australia to this product. 
7.926  The Panel does not view the comparison situation in this dispute, namely the one relating to 
Japanese nashi pears, as part of New Zealand's claim.  Rather, it be longs to New Zealand's arguments.  
In EC – Bananas III , the Appellate Body established a cl ear distinction between claims and 
arguments.  "[T]here is a si gnificant difference between the claims identified in the request for the 
establishment of a panel, which establish  the panel's terms of reference under DSU  Article 7, and the 
                                                      
2512 (footnote original ) Australia – Apples , Request for the Establishment of a Panel by New Zealand 
(WT/DS367/5), 7 December 2007, p. 3. 
2513 (footnote original ) Australia – Apples , Written Submission by New Zealand on Australia's Request 
for a Preliminary Procedural Ruling in Relation to th e Consistency of New Zealand's Panel Request with 
Article 6.2 of the DSU, 7 April 2008, para. 2.51. 
2514 (footnote original ) See Appellate Body Report on US – Oil Country Tubular Goods Sunset 
Reviews , para. 162. 
2515 Australia – Apples , Communication From the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, para. 10. 
2516 Australia – Apples , Communication From the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, para. 11 (original emphasis). WT/DS367/R 
Page 414  
 
 arguments  supporting those claims, which are set out a nd progressively clarified in the first written 
submissions, the rebuttal submissions and the firs t and second panel meetings with the parties."
2517 
7.927  As recognized by the Panel's preliminary ruling2518, the Appellate Body also stated that, while 
an absence of claims in a panel request  cannot be corrected at a later stage2519, there is no requirement 
for the complainant to specify its arguments in th e panel request.  "Article 6.2 of the DSU requires 
that the claims , but not the arguments , must all be specified suffici ently in the request for the 
establishment of a panel in order to allow the defe nding party and any third parties to know the legal 
basis of the complaint."2520 
7.928  The due process consideration with regard to pa nel requests serves to allow the defendant to 
"begin" preparing its defence.  In this regard, the Panel's preliminary ruling referred to the decision of 
the Appellate Body in Thailand – H-Beams , which provides that: 
"Article 6.2 of the DSU calls for sufficient cl arity with respect to the legal basis of the 
complaint, that is, with respect to th e 'claims' that are being asserted by the 
complaining party.  A defending party is entitled to know what case it has to answer, 
and what violations have been alleged so that it can begin preparing its defence.   
Likewise, those Members of the WTO who intend to participate as third parties in 
panel proceedings must be informed of  the legal basis of the complaint.  
This requirement of due process is fundament al to ensuring a fair and orderly conduct 
of dispute settlement proceedings."2521 
7.929  The requirement that the complainant submit a panel request allowing the defendant to 
"begin" preparing its defence does not amount to a requirement for allowing the defendant to fully 
develop its defence on the sole basis of the complain ant's panel request.  Such an interpretation would 
wipe out any distinction between claims and argumen ts. It would also reduce to futility the subsequent 
phases of WTO dispute settlement.  It is during the exchange of written submissions and the 
presentation of oral arguments that the parties con front each other's arguments and counterarguments. 
7.930  As the Panel's preliminary ruling stated, the pa nel request in this dispute identified that 
New Zealand claims an inconsistency of the 17 measures at issue with, among other specific 
provisions, Article 5.5 of the SPS Agreement.  This a llowed Australia to begin preparing its defence.  
In fact, even without knowing the product of comparison, Australia could start preparing some of its legal arguments concerning New Zealand's Article 5.5 claim, for instance, concerning the legal 
standard to be applied by the Panel in its analysis  of this claim.  Following the Panel's preliminary 
ruling, Australia was fully aware that New Zealand' s Article 5.5 claim relates to 17 specific measures 
in regard to New Zealand apples.  Thus, Aust ralia could begin preparing its arguments under 
Article 5.5 of the SPS Agreement in regard to the sp ecific situation applicable to New Zealand apples, 
even if it ignored the specific situations to be argued by New Zealand as the other half of the 
comparisons under Article 5.5. 
7.931  Australia could have even begun preparing its de fence in regard to this second half of the 
comparison.  As Australia has argued since its firs t written submission, it has the same stated ALOP 
for all biosecurity risks from all parts of the world.   Further, once New Zealand specified in its panel 
request that its Article 5.5 claim relates to 17 sp ecific measures in regard to New Zealand apples, 
                                                     
 
2517 Appellate Body Report on EC – Bananas III , para. 141. 
2518 Australia – Apples , Communication From the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, para. 11. 
2519 Appellate Body Report on EC – Bananas III , para. 143. 
2520 Ibid. (original emphasis). 
2521 Appellate Body Report on Thailand – H-Beams , para. 88 (footnotes omitted;  emphasis added).  WT/DS367/R 
 Page 415 
 
 
 the number of comparable situations that Australi a could begin looking at was significantly reduced.  
In fact, Australia was supposed to take the compar able situations into account when it developed its 
IRA for New Zealand apples, including the 17 specific measures called into question in this dispute.  
This is the essence of Article 5.5 with regard to both pre-existing (but currently applicable) and 
currently developed ALOPs, and the risk manageme nt measures to achieve such ALOPs.  This is 
confirmed by the explanations provided in the Gu idelines to Further the Practical Implementation of 
Article 5.5 adopted in June 2000 by the Committ ee on Sanitary and Phytosanitary Measures.  
In regard to ALOPs, the Guidelines provide that: 
"To avoid arbitrary or unjustifiable differenc es in the level of protection a Member 
considers to be appropriate in different  situations, a Member should compare any 
proposed decision on the level of protection in a particular situation with the level it 
has previously considered or is consideri ng to be appropriate in situations which 
contain sufficient common elements so as to render them comparable with regard to human life or health, to animal life or  health, or to plant life or health. 
It can be useful to compare a proposed  appropriate level of protection with 
previous decisions, including those that  might have been taken in an ad hoc 
fashion, to ensure that any differences in levels of protection applied in a 
similar situation are justifiable and would not result in discrimination or a disguised restriction on international trade.  If differences are observed in comparable situations, either the proposed level may need to be modified, or 
the level of protection previously determ ined may need to be revised in light 
of the Member's current views on its appropriate level of protection, or a combination of the two. "
2522 
7.932  Further, the Guidelines explain that: 
"In determining a new or modified appropria te level of protection, a Member should 
review its previous decisions regarding appropr iate levels of protection in the light of 
the objectives and obligations of Article 5.5,  taking into account current decisions and 
developments.   
In undertaking this review, a Member may wish to give priority to the review 
and revision, as necessary, of those decisions which most substantially deviate from the objectives and obligations  of Article 5.5 and which may have 
the most negative impact on international trade. 
Unless changes are made at the same time  to all its comparable decisions on 
appropriate levels of protection, a Member may find it difficult to avoid (at least temporary) unjustifiable differences in levels of protection.  
                                                     
 
2522 SPS Committee's Guidelines to further the practical implementation of Article 5.5  (G/SPS/15), 
18 July 2000, para. A.4.  The Panel notes that these Gu idelines are "intended to provide assistance to Members 
in the practical implementation of the provisions of Ar ticle 5.5 of the SPS Agreement [and] do not add to nor 
detract from the existing rights and obligations of  Members under the SPS Ag reement nor any other WTO 
Agreement."  Further the Guidelines "do not provide any legal interpretation or modification to the Agreement 
itself [and] are without prejudice to the right of a Memb er to determine its appropriate level of sanitary and 
phytosanitary protection against risks to human life or h ealth, or to animal and plant life or health."  SPS 
Committee's Guidelines to further the practical implementation of Article 5.5  (G/SPS/15), 18 July 2000, 
Introduction. WT/DS367/R 
Page 416  
 
 A Member should review its previous d ecisions on appropriate levels of 
protection at suitable intervals. "
2523 
7.933  The Guidelines include similar explanations w ith regard to pre-existing (but currently 
applicable) and currently developed SPS measures to achieve a Member's ALOP.2524 
7.934  Furthermore, as New Zealand argues, Austra lia's 1998 Final IRA Report for New Zealand 
apples already considered Japanese nashi pears as pr oviding a comparable situation in the context of 
fire blight: 
"Australia has allowed imports of nashi type pears from Japan for some years. 
Recently the reoccurrence of a bacterial di sease bacterial shoot blight was reported in 
Japan on the island of Hokkaido (Kim et al , 1996). This disease is similar to fire 
blight disease and therefore AQIS immediately suspended imports until the situation 
could be assessed and adequate arrangement s implemented to manage any risks. 
... Trade in [nashi] pears from Japan is broadl y comparable to the New Zealand proposal 
in that it involves trade in  a susceptible host product from a country with a disease 
similar to fire blight.  It differs from th e New Zealand proposal in that it involves only 
a very low volume of fruit, risk management is based on a robust area freedom arrangement and there is a stringent eradication program for the disease in place. 
The New Zealand proposal does not offer an equivalent level of protection to the 
protocol in place for trade with Japan."
2525 
7.935  In sum, the Panel accepts that Australia could not fully develop its defence merely based on 
New Zealand's panel request.  Nevertheless, as explained above, Australia could have begun 
preparing its defence based on the panel request, an d there is no evidence that Australia's ability to 
defend itself was prejudiced in this dispute.  In this regard, the Panel's preliminary ruling provides 
that, despite the Panel's preference for more expl anations by New Zealand as to how or why it 
considered the measures at issue to violate the id entified provisions of the SPS Agreement, there was 
enough information in New Zealand's panel request  for the Panel to allow the case to proceed.  
"[C]onsidering the language used in the panel request  and the specific content of the provisions of the 
SPS Agreement cited therein, the Panel concludes th at New Zealand's panel request contains enough 
information to adequately inform the responding party and other WTO Members on the nature of the 
complaint2526 and to allow the responding party to begin preparing its defence.2527"2528 
7.936  The Panel confirms its rejection of the thres hold issue raised by Australia in regard to 
New Zealand's Article 5.5 claim, and turns to the su bstantive analysis of that claim according to the 
three elements of Article 5.5 developed by  the Appellate Body and previous panels. 
                                                      
2523 SPS Committee's Guidelines to further the practical implementation of Article 5.5  (G/SPS/15), 
18 July 2000, para. A.5. 
2524 SPS Committee's Guidelines to further the practical implementation of Article 5.5  (G/SPS/15), 
18 July 2000, paras. B.3 and B.4. 
2525 See Final Import Risk Analysis of the New Ze aland Request for the Access of Apples ( Malus pumila  
Miller var. domestica  Schneider) into Australia  (December 1998), in  Exhibit AUS-112. 
2526 (footnote original ) Appellate Body Report on EC – Bananas III , para. 142. 
2527 (footnote original ) Appellate Body Report on Thailand – H-Beams , para. 88. 
2528 Australia – Apples , Communication From the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, para. 11.  WT/DS367/R 
 Page 417 
 
 
 3. The three elements of Article 5.5 
(a) The first element of Article 5.5 
7.937  The panel in Australia – Salmon referenced the first element of the Article 5.5 test as 
"[d]istinctions in levels of prot ection for 'different situations'"2529, and  analysed two aspects of this 
first element:  (i) "different situations"2530;  and (ii) "difference in levels of protection".2531  T h e  
compliance panel in Australia – Salmon (Article 21.5 – Canada)  looked at the same two aspects of the 
first element of the Article 5.5 test.2532  Likewise, this Panel will assess whether the situations 
identified by New Zealand are different (but compar able), and whether they involve a difference in 
ALOP. 
(i) Different but comparable situations 
7.938  The first aspect of the first element of th e three-pronged test under Article 5.5 involves 
whether the situations identified by New Zealand ar e different but comparable.  Article 5.5 mentions 
"different situations", but this term has been  interpreted as meaning different but comparable 
situations.  For instance, the panel in EC – Hormones  noted that it would "refer to ... 'different 
situations' as 'comparable situations' since these [di fferent] situations need to be compared for the 
purposes of Article 5.5 and are, therefore, 'comparable'."2533  In the same dispute, the Appellate Body 
confirmed that: 
"The situations exhibiting differing le vels of protection cannot, of course, 
be compared unless they are comparable, that is, unless they present some common 
element or elements sufficient to render them  comparable.  If the situations proposed 
to be examined are totally different from one another, they would not be rationally 
comparable and the differences in levels of protection cannot be examined for 
arbitrariness."2534 
7.939  This basic requirement that the "different situ ations" mentioned in Article 5.5 need to be 
comparable has been inherent in subsequent reports that analysed the first element of the Article 5.5 
test.2535 
7.940  New Zealand identifies two pairs of comparator situations in its arguments under Article 5.5: 
(a) Australia's requirements on New Zealand apples regarding fire blight ( Erwinia 
amylovora ), compared with Australia's requirements on Japanese nashi pears 
regarding Japanese Erwinia ;  and 
(b) Australia's requirements on New Zeal and apples regarding European canker 
(Neonectria galligena ), compared with Australia's requirements on Japanese nashi 
pears regarding brown rot ( Monilinia fructigena ). 
                                                      
2529 Panel Report on Australia – Salmon , p. 174, DSR 1998:VIII, 3410, at 3640. 
2530 Panel Report on Australia – Salmon , p. 175, DSR 1998:VIII, 3410, at 3642. 
2531 Panel Report on Australia – Salmon , p. 178, DSR 1998:VIII, 3410, at 3646. 
2532 Panel Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.89. 
2533 Panel Report on EC – Hormones (US) , para. 8.176;  and Panel Report on EC – Hormones 
(Canada) , para. 8.179. 
2534 Appellate Body Report on EC – Hormones , para. 216 (original emphasis). 
2535 See Panel Report on Australia – Salmon , paras. 8.115-8.122;  Appellate Body Report on Australia 
– Salmon , paras. 143-153;  and Panel Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.89.  See 
also SPS Committee's Guidelines to further the practical implementation of Article 5.5  (G/SPS/15), 18 July 
2000, paras. A.2 and A.4. WT/DS367/R 
Page 418  
 
 7.941  Both comparisons involve circumstances that are clearly different:  they deal with distinct 
pests and distinct fruits from distinct origins.  Whether these comparator situations are comparable 
depends on whether they fulfil the conditions  laid down by the Appellate Body in Australia – Salmon : 
"Situations which involve a risk of entry, establishment or spread of the same or a 
similar disease have some common elements sufficient to render them comparable 
under Article 5.5.  Likewise, situations with a risk of the same or  similar associated 
potential biological and economic conseque nces also have some common elements 
sufficient to render them comparable under Artic le 5.5.  We, therefore, consider that 
for 'different' situations to be comparable  under Article 5.5, there is no need for both 
the disease and the biological and economic consequen ces to be the same or similar.  
We recognize that ... the risk which needs to be examined in a risk assessment, 
pursuant to Article 5.1 and the first defin ition of risk assessment  of paragraph 4 of 
Annex A, is the risk of both the entry, establishment or spread of a disease and the 
associated potential biological and economic consequences.  However, we fail to see 
how this can be of relevance to the questi on of comparability of different situations 
under Article 5.5 ... .  We, therefore, conc lude that ... situations can be compared 
under Article 5.5 if these situations involve either a risk of entry, establishment or 
spread of the same or a similar disease, or a risk of the same or similar 'associated 
potential biological and economic consequences'."
2536 
7.942  Importantly, in developing these alternative conditions of comparability the Appellate Body 
refrained from qualifying the word "risk" with the te rm "same or similar".  Rather, it used the term 
"same or similar" to qualify the words "disease"  and "associated potential biological and economic 
consequences".  Accordingly, the comparison of si tuations needs to focus on the diseases or the 
associated potential biological and economic conse quences involved in the comparator situations. 
7.943   In other words, the comparability test under the first element of the Article 5.5 analysis does 
not involve a comparison of risk levels.  Indeed, in  analysing whether different situations existed in 
the Australia – Salmon  dispute, the panel stated that: 
"[A]t this stage of our examination we only address the question whether two 
situations can be compared under Article 5.5.   We do not examine nor decide at this 
point whether the risk (both in the sense of risk of entry, establishment or spread of 
the disease and the associated consequences) linked to these two situations is the 
same or has been addressed inconsistently .  This issue needs to be examined under 
the second element of Article 5.5."2537 
7.944  The first condition of comparability identified by the Appellate Body refers to "a risk of entry, 
establishment or spread of the same or a similar disea se".  In the light of the above, the Panel needs to 
assess whether the diseases involved in the allegedly comparable situati ons are effectively the same or 
similar.  The second condition of comparability identifie d by the Appellate Body refers to "a risk of 
the same or similar associated potential biological  and economic consequences".  This requires an 
assessment of whether the potential biological and economic consequences associated with the 
diseases are the same or similar.  These two c onditions of comparability being non-cumulative, the 
Panel will turn to the second, alternative condition onl y if it finds that the first one is not fulfilled. 
                                                      
2536 Appellate Body Report on Australia – Salmon , para. 146 (original emphasis).  See also SPS 
Committee's Guidelines to further the practical implementation of Article 5.5  (G/SPS/15), 18 July 2000, 
para. A.2.  
2537 Panel Report on Australia – Salmon , para. 8.118.  WT/DS367/R 
 Page 419 
 
 
 Comparability of fire blight (Erwinia amylovora) and Japanese Erwinia  
7.945  Fire blight ( Erwinia amylovora ) in apples and Japanese Erwinia in nashi pears are not the 
same diseases.  They are very si milar diseases, though.  One of the experts consulted by the Panel, 
Dr Deckers, confirms that, while in some respec ts the risks involved in the two pests might be 
different, "[t]here is a great similarity between the Japanese Erwinia associated with nashi pears and 
Erwinia  amylovora  on apples from New Zealand.  In both cases it concerns a bacterial disease on 
fruits, the one Japanese Erwinia  on pear and the other fire blight one on apple and pear."2538 
7.946  Conceding that "little is known in the literature about [ Japanese Erwinia  as a] Nashi disease", 
another expert, Dr Paulin, agrees that, apart from cer tain potential differences in the risks associated 
with the two pests, "it seems that the bacteria ( Erwinia -Japan and E. amylovora ) are very similar but 
not identical , and the symptoms seem similar as well."2539 
7.947  Biological similarity is a key element of the co mparison of the two diseases.  In this respect, 
the Panel finds the following arguments and ev idence submitted by New Zealand particularly 
convincing:  " Japanese Erwinia  is very hard to differentiate from E. amylovora.   Each produces very 
similar symptoms and analysis at the molecular le vel is used to distinguish between the two (Kim et 
al. 2001:  2951 and Shrestha et al. 2007:  1023).2540"2541 
7.948  In fact, the Kim et al.  2001 article referenced by New Ze aland had to conduct a molecular 
analysis of various Erwinia  cultures originating from Nashi pear  trees in Japanese orchards, to draw 
the limited conclusion that, despite symp toms similar to fire blight, these Erwinia  cultures in Japanese 
nashi pears were "possibly" different from fire blight: 
"Several strains of the genus Erwinia , which were isolated in Japan from pear trees 
with necrotic symptoms that resembled fi re blight, and tentatively identified as 
Erwinia amylovora , were reinvestigated for their relationship to the fire blight 
pathogen.  ...  It is concluded that path ogenic bacteria isolated in Japan from pear 
trees with symptoms resembling fire blight are possibly different from Erwinia 
amylovora ."2542 
7.949  Accordingly, the Panel finds that fire blight in New Zealand apples and Japanese Erwinia in 
Japanese nashi pears can be qualified as similar dis eases for the purposes of the first element of the 
Article 5.5 test. 
7.950  The Panel recalls that the Appellate Body d escribed the first condition of the comparability 
test under Article 5.5 by reference to "a risk of entr y, establishment or spread of the same or a similar 
                                                      
2538 Dr Deckers's reply to Panel question 12, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 107. 
2539 Dr Paulin's reply to Panel question 12, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 109 (original emphasis). 
2540 (footnote original ) see Exhibit NZ-68:  Kim WS, Hildebrand M, Jock S and Geider K (2001) 
"Molecular comparison of pathogenic  bacteria from pear trees in Japan and fireblight pathogen Erwinia 
amylovora ", Microbiology  147, 2951-2959, and Shrestha R, Lee SH, Kim JE, Wilson C, Choi SG, Park DH, 
Want MH, Hur JH and Lim CK (2007) "Diversity and detection of Korean Erwinia pyrifoliae strains as 
determined by plasmid profiling, phylogenetic analysis and PCR", Plant Pathology  56, 1023-1031. 
2541 New Zealand's first writte n submission, para. 4.437. 
2542 Kim et al ., "Molecular comparison of pathogenic bacteria  from pear trees in Japan and the fire 
blight pathogen Erwinia amylovora " (2001), in Exhibit NZ-68, p. 1. WT/DS367/R 
Page 420  
 
 disease."
2543  As explained above, the assessment of this  condition does not require a comparison of 
levels of risk.  However, the Appellate Body defi ned the first condition of the comparability test by 
including the term "risk".  Thus, for there to be comp arable situations, some degree of risk needs to be 
associated with both comparator diseases, or both sets of associated potential biological and economic consequences.  To establish this, the complainant ne eds to make a prima facie case – not successfully 
rebutted by the respondent – that some degree of risk  is associated with the situations that are being 
compared to the situations at issue in the dispute.   New Zealand needs to show that the comparator 
situations it advances for Japanese nashi pears are not  completely without risk for Australia.  For the 
purpose of the comparability test and in the circum stances of this dispute, New Zealand does not need 
to quantify risk, just prove its basic existence.  In fact, the situations would not be "rationally 
comparable and the differences in levels of prot ection [could] not be examined for arbitrariness"
2544 if 
the comparator situations advanced by New Zealand in regard to Japanese nashi pears did not involve 
any risk at all for Australia. 
7.951  For the purpose of the comparability test and in th e circumstances of this dispute, the question 
for the Panel is whether Japanese Erwinia in Japanese nashi pears entails any risk for Australia at all.  
New Zealand argues that it does, and advances a number of arguments in regard to the risk profile of 
Japanese Erwinia .  Conversely, Australia argues that its May 1989 Quarantine Circular Memorandum 
for Japanese nashi pears did not consider Japanese Erwinia  because, as Dr Schrader confirmed, there 
is no need to assess the risk of a pest or disease which does not occur in the geographical area for 
which a risk assessment is conducted.  In Austra lia's view, ISPM No. 11 supports this:  "If no 
potential quarantine pests are identified as likely to follow the pathway, the PRA may stop at this 
point."  Accordingly, Australia argues that, as a consequence of Japanese Erwinia  never having 
occurred in Tottori prefecture, the consideration of Japanese Erwinia  was not, and is not, a pest 
relevant to the importation of nashi pears from To ttori prefecture in Japan.  Its consideration as a 
comparable disease to fire blight under New Z ealand's Article 5.5 claim therefore has little 
relevance.2545 
7.952  One of the experts, Dr Paulin, notes in regard to Japanese Erwinia that "it is not certain that 
this particular Erwinia  from Japan be considered as a quarantin e pathogen" as "too little knowledge is 
available on this Nashi disease to be sure."2546 
7.953  The Panel reiterates that assessing the existence of a risk under the first condition of the 
comparability test of Article 5.5 does not require a de tailed assessment of risk levels.  In particular, 
the Panel does not consider at this point whet her, as Australia argues,  Japanese nashi pears are 
imported only from Tottori prefecture.  The question is whether Japanese nashi pears involve a risk of 
Japanese Erwinia  for Australia at all.  Australia implicitly admits that to be the case by arguing that it 
has in place a requirement for Japanese Erwinia , applicable also to Jap anese nashi pears imported 
from Tottori prefecture: 
"As a direct consequence of Japanese Erwinia  never having occurred in Tottori 
prefecture, the only requirement in place for Japanese Erwinia  is that Japan notify 
Australia of any future outbreaks of the disease anywhere  in Japan.  This requirement 
was included in the 2003 review as a result of the 1995 outbreak in Hokkaido.  However, given the confinement of the out break to the geographically remote island 
                                                     
 
2543 Appellate Body Report on Australia – Salmon , para. 146 (original emphasis).  See also, 
SPS Committee's Guidelines to further the practical implementation of Article 5.5  (G/SPS/15), 18 July 2000, 
para. A.2.  
2544 Appellate Body Report on EC – Hormones , para. 216 (original emphasis). 
2545 Australia's reply to Panel question 119 after the second substantive meeting. 
2546 Dr Paulin's reply to Panel question 12, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 110.  WT/DS367/R 
 Page 421 
 
 
 of Hokkaido;  the eradication program implemented by Japan;  and the absence of 
Japanese Erwinia  occurrences elsewhere in Japan, no further requirements were 
deemed necessary."2547 
7.954  Accordingly, Erwinia amylovora in New Zealand apples and Japanese Erwinia in Japanese 
nashi pears involve a risk of similar diseases, and therefore fulfil the first condition of the 
comparability test established by the Appellate Body in Australia – Salmon . 
7.955  As noted above, in the same dispute the A ppellate Body also explained that the two 
conditions of this comparability test are not cumu lative.  Accordingly, the Panel finds that the 
situations with respect to fire blight in New Zealand apples and to Japanese Erwinia in Japanese nashi 
pears are comparable.  Having made its finding on th e basis of the first condition of the comparability 
test laid down by the Appellate Body, the Panel does not need to analy ze the second, alternative 
condition of comparability:  whether the situations concern a risk of the same or similar associated 
potential biological and economic consequences. 
Comparability of European canker (Neonect ria galligena) and brown rot (Monilinia 
fructigena)  
7.956  Turning to the comparison of European canker ( Neonectria galligena ) in New Zealand apples 
and brown rot ( Monilinia fructigena ) in Japanese nashi pears, the Pa nel analyses first whether these 
situations entail a risk of the same or similar diseases.  New Zealand argues that these diseases are 
similar in that they are both fungal diseases, and "[l] ike European canker, brown rot is transmitted by 
spores and can infect both pears and apples, usually  through natural openings or wounds.  Apparently 
healthy fruit can be infected without showing any symptoms ... ."2548 
7.957  Australia accepts that European canker and brow n rot are similar only to the extent that both 
are fungal diseases which can produce spores on fruit.2549 
7.958  The Panel recalls that in EC – Hormones the Appellate Body linked the essence of the 
comparability test to the existence of some commo n element or elements sufficient to render the 
situations comparable: 
"The situations exhibiting differing le vels of protection cannot, of course, 
be compared unless they are comparable, that is, unless they present some common 
element or elements sufficient to render them  comparable.  If the situations proposed 
to be examined are totally different from one another, they would not be rationally 
comparable and the differences in levels of protection cannot be examined for arbitrariness."
2550 
7.959  Based on New Zealand's arguments, the Panel sees four main points in common between 
European canker and brown rot.  Both are fungal diseases, both are transmitted via spores, both can infect apples (usually through natural openings or  wounds), and can involve latent infection of 
symptomless fruit.
2551  Australia has not rebutted these similarities.  Therefore, even though European 
canker ( Neonectria galligena ) in New Zealand apples and brown rot ( Monilinia fructigena ) in 
Japanese nashi pears are distinct diseases, they sh are some common elements sufficient to render 
them similar. 
                                                      
2547 Australia's reply to Panel question 199 after th e second substantive meeting (original emphasis). 
2548 New Zealand's first writte n submission, para. 4.441. 
2549 Australia's first written submission, para. 1001. 
2550 Appellate Body Report on EC – Hormones , para. 216 (original emphasis). 
2551 New Zealand's first written submission, paras. 4.440-4.441 WT/DS367/R 
Page 422  
 
 7.960  The Panel notes that ever since its May 1989 Qu arantine Circular Memorandum for Japanese 
nashi pears, Australia has been applying or at least  proposing measures against the risk of brown rot.  
Accordingly, like European canker in New Zeala nd apples, brown rot in Japanese nashi pears also 
poses a risk.  This, in addition to the basic similarity  of the two diseases, allows the Panel to conclude 
that the situations involving European canker ( Neonectria galligena ) in New Zealand apples and 
brown rot ( Monilinia fructigena ) in Japanese nashi pears are comparable. 
7.961  As noted above, the two conditions of comparab ility under the first element of the Article 5.5 
test are not cumulative.  Consequently, there is no need to engage in an analysis of the second, 
alternative condition of comparability:  whether the s ituations entail a risk of the same or similar 
associated potential biological and economic consequences. 
(ii) The ALOPs in the different situations 
7.962  Having found that the two pairs of comparator situations identified by New Zealand are 
comparable given the similarities of the diseases i nvolved, the Panel turns to the second aspect of the 
first element of the Article 5.5 test:  the ALOP s in these different but comparable situations. 
7.963  The Parties agree that currently Australia has th e same stated and generic ALOP for all of the 
different situations identified by New Zealand,  i.e. fire blight in New Zealand apples and 
Japanese Erwinia in Japanese nashi pears, as well as Europ ean canker in New Zealand apples and 
brown rot in Japanese nashi pears.   This ALOP is:  "providing a high level of sanitary and 
phytosanitary protection aimed at reducing risk to a very low level, but not to zero."
2552  In other 
words, Australia has formulated one ALOP  for all of these comparable situations. 
7.964  If Australia's ALOP is the same for Japan ese Nashi pears and New Zealand apples with 
respect to the four pests identified, the Panel must  consider whether it can proceed with its analysis 
under Article 5.5.  In EC – Hormones the Appellate Body referred to "situations exhibiting differing 
levels of protection", and stated categor ically that "[c]learly comparison of several levels of sanitary 
protection deemed appropriate by a Member is nec essary if a panel's inquiry under Article 5.5 is to 
proceed at all."2553 
7.965  It is noteworthy that the Parties reference two definitions by the Appellate Body for the first 
element of the three-pronged Article 5.5 test.  Australia quotes the report in Australia – Salmon , 
where the Appellate Body included in the first elem ent of Article 5.5 the distinctions in the ALOPs 
applicable to the different comparator situations: 
"Following our Report in European Communities – Hormones, the Panel 
[in Australia – Salmon ] considered: 
... that three elements are required in order for a Member to act inconsistently with 
Article 5.5: 
                                                      
2552 See Import Risk Analysis Handbook  (2003), in Exhibit AUS-10, p. 5, and Import Risk Analysis 
Handbook  (2007), p. 9 and Annex 3.  Formerly, Australia ma intained a similar qualitative ALOP.  According to 
the 1998 AQIS Import Risk Analysis Process Handbook, "A ustralia does not ... maintain a zero risk quarantine 
policy, which would be impracticable since it would imply the exclusion of all import trade and entry of 
international passengers.  Rather, Australia's quarantin e policy is based on the concept of the management of 
risk to an acceptably low level."  1998 AQIS Im port Risk Analysis Proc ess Handbook, p. 11. 
2553 Appellate Body Report on EC – Hormones , para. 214 (emphasis added).  WT/DS367/R 
 Page 423 
 
 
 – the Member concerned adopts different a ppropriate levels of sanitary protection 
in several 'different situations';  ..."2554 
7.966  The Panel notes that in Australia – Salmon the Appellate Body referenced the first element of 
the Article 5.5 test as "the existence of distinctions  in appropriate levels of  protection in different 
situations."2555 
7.967  Conversely, New Zealand references the earlie r definition of the three-pronged test in EC – 
Hormones .  In that dispute, the Appellate Body mentioned "distinctions" in ALOP as part of the 
second element: 
"Close inspection of Article 5.5 indicates that a complaint of violation of this 
Article must show the presence of three distin ct elements.  The first element is that 
the Member imposing the measure complain ed of has adopted its own appropriate 
levels of sanitary protection against risks to human life or health in several different 
situations.  The second element to be shown is that those levels of protection exhibit 
arbitrary or unjustifiable differences ('distin ctions' in the language of Article 5.5) 
in their treatment of different situations."2556 
7.968  The Panel does not read this passage in EC – Hormones as necessarily reducing the first 
element of the Article 5.5 test to a mere requirement that an ALOP exist in the different situations that 
are being compared.  In fact, in the same dis pute the Appellate Body also enunciated the above-
quoted categorical requirement that several ALOPs n eed to exist before any analysis of Article 5.5 
can proceed in earnest.  Further, in its de tailed analysis under the Article 5.5 test, in EC – Hormones 
the Appellate Body referenced "the first element se t out in Article 5.5, namely that a Member has 
established different levels of pr otection which it regards as appropriate for itself in differing 
situations."2557  The Panel also notes that in the Guidelin es to Further the Practical Implementation of 
Article 5.5, the definition of the three elements "a  Member should, when de termining an appropriate 
level of protection, either as an overall policy ob jective or for a specific situation, consider"2558 
include a "difference" in ALOP as part of the first element: 
"– whether there is a difference between the level of protection under 
consideration and levels already dete rmined by the Member in different 
situations and, if so, 
– whether these differences are arbitr ary or unjustifiable, and, if so, 
– whether they may result in discrimination or in a disguised restriction on 
international trade."2559 
7.969  Given that Australia has the same stated ALOP  for the situations New Zealand intends to 
compare, the Panel is satisfied that Australia h as adopted its own ALOP in these situations in the 
literal sense of the Appellate Body 's above-quoted definition of the first element of Article 5.5 in 
EC - Hormones .  However, this is clearly not sufficient fo r the Panel to proceed with its analysis of 
New Zealand's Article 5.5 claim.  In the light of the categorical statement by the Appellate Body in 
EC – Hormones , the second quoted definition of the first el ement of the Article 5.5 test in the same 
                                                      
2554 Appellate Body Report on Australia – Salmon , para. 140 (footnotes omitted). 
2555 Appellate Body Report on Australia – Salmon , para. 143. 
2556 Appellate Body Report on EC – Hormones , para. 214. 
2557 Appellate Body Report on EC – Hormones , para. 216. 
2558 SPS Committee's Guidelines to further the practical implementation of Article 5.5  (G/SPS/15), 
18 July 2000, para. A.2. 
2559 Ibid. WT/DS367/R 
Page 424  
 
 dispute, and the similar definition in Australia – Salmon , the Panel also needs to assess whether 
New Zealand has demonstrated that the measures Aust ralia applies in the comparable situations result 
in a different de facto  ALOP. 
7.970  The Panel agrees with New Zealand that Member s should not be allowed to hide behind a 
generically stated ALOP.  Otherwise, Members' ob ligations under Article 5.5 would be diminished.  
This would be particularly serious in the case of Australia – or, for that matter, any other Members – 
whose generically stated ALOP covers a wide range  of products and diseases, and thus a wide range 
of potentially comparable situations. 
7.971  The Panel notes that in Australia – Salmon  the Appellate Body warned in general terms 
against reading out entire provisions from the SPS  Agreement.  "It would obviously be wrong to 
interpret the SPS Agreement  in a way that would render nugatory entire articles or paragraphs of 
articles of this Agreement and allow Member s to escape from their obligations under this 
Agreement."
2560 
7.972  Further in Australia – Salmon (Article 21.5 – Canada)  the compliance panel noted, in the 
context of its analysis under Article 5.6 of the SPS Agreement, that while a vaguely determined 
ALOP is not ideal, it should not prevent scr utiny under the SPS Agreement, including under 
Article 5.5: 
"Although, according to the Appellate Body , Australia determined its ALOP with 
sufficient precision to apply Article 5.6, we  find it rather difficult to evaluate whether 
any of the options before us would also meet Australia's somewhat vaguely determined level of 'a high or very conser vative level of protection aimed at reducing 
risk to very low levels, while not based on a zero-risk approach'.  We are of the view, 
however, that this should not prevent us from carrying out the task.  As noted by the Appellate Body, '[o]therwise, a Member's  failure to comply with the implicit 
obligation to determine its a ppropriate level of protection – with sufficient precision – 
would allow it to escape its obligations under this Agreement and, in particular, its 
obligations under Articles 5.5 and 5.6'.  We note, parenthetically, that a more explicit 
and in particular a quantitative expression of a Member's ALOP would greatly facilitate the consideration of compliance with not only Article 5.6 but with other 
provisions of the SPS Agreement as well."
2561 
7.973  Indeed,  the Panel can imagine the possibility, ar gued by New Zealand in this dispute, that 
despite a generic ALOP, the measures applied in different situations may lead to a de facto difference 
in ALOPs.  Whether this is the case will depend on both the measures applied to implement the same 
stated ALOP in different situations, as well as th e risks against which such measures are applied. 
7.974  Measures are indicative – although not necessarily conclusive – of a Member's ALOP.  
Annex A(5) of the SPS Agreement defines "appropriate  level of sanitary or phytosanitary protection" 
by specific reference to the SPS measure s applied to implement that ALOP: 
"Appropriate level of sanitary or phytosanitary protection  – The 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." 
7.975  Previous panels have also recognised the cl ose link between a Member's SPS measures and 
the ALOP such measures serve to implement.  The panel in EC – Hormones stated that, in contrast to 
                                                     
 
2560 Appellate Body Report on Australia – Salmon , para. 206. 
2561 Panel Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.129 (footnotes omitted).  WT/DS367/R 
 Page 425 
 
 
 Article 2.3 of the SPS Agreement, "Artic le 5.5 ... deals more specifically with distinctions in levels of 
protection  (which will normally be reflected in one or more sanitary measures ) ... ."2562  Likewise, the 
panel in Australia – Salmon found that "any sanitary measure applied to a given situation inherently 
reflects and achieves a certain level of protection"2563, and reiterated that "the  appropriate level of 
sanitary protection will normally be reflected in  the sanitary measures imposed for a specific 
situation."2564  Further, the panel in EC – Biotech held that "although Article 5.5 does not explicitly 
refer to 'SPS measures'"2565, this provision "implies a reference to 'SPS measures'."2566  T h e  s a m e  
panel quoted paragraph B.1 of the Guidelines to Furt her the Practical Implementation of Article 5.5, 
which provides that "the concept of appropriate le vel of protection is applied in practice through 
sanitary or phytosanitary measures."2567  The panel confirmed that this guidance "is consistent with 
relevant Appellate Body jurisprudence"2568, and quoted the Appellate Body's reference in EC – 
Hormones to a " measure embodying or implementing a par ticular level of protection."2569 
7.976  Yet, as New Zealand concedes2570, a Member's ALOP in a sp ecific situation cannot be 
deduced solely from the SPS measures the Member applies.  In Australia – Salmon  the Appellate 
Body clearly distinguished ALOP and measures, by st ating that "[t]he 'appropria te level of protection' 
established by a Member and the 'SPS measure' have to  be clearly distinguished.  They are not one 
and the same thing.  The first is an objective , the second is an instrument  chosen to attain or 
implement that objective."2571 
7.977  Risk is also an inherent element of a Me mber's ALOP.  The note to the definition of 
"appropriate level of sanitary or phytosanitary protection" in Annex A(5) of the SPS Agreement 
indicates that "[m]any Members otherwise refer to th is concept as the 'acceptable level of risk'."  
Further, the panel in Australia – Salmon pointed out that "the level of protection achieved by a 
specific sanitary measure will also depend on the degree of risk against which that measure is 
intended to protect."2572  As the same panel explained, this is because: 
"[I]mposing the same sanitary measure for different situations does not necessarily 
result in the same level of protection.  I ndeed, in many situations (e.g., situations 
representing different risks) the same sanitary measure might result in different levels 
of protection.  On the other hand, different  sanitary measures for different situations 
might ensure the same level of protection.   Indeed, one given situation might only 
represent a small risk for which a lenient san itary measure will achieve a high level of 
protection, whereas another situation might  pose very high risks requiring a very 
strict and different sanitary measure in order to meet that same high level of 
protection."2573 
7.978  In the same vein, the Guidelin es to Further the Practical Implementation of Article 5.5 state 
that, in the context of the practical implementa tion of the concept of an appropriate level of 
                                                      
2562 Panel Report on EC – Hormones (US) , para. 8.168 and Panel Report on EC – Hormones (Canada) , 
para. 8.171 (emphasis added). 
2563 Panel Report on Australia – Salmon , para. 8.107. 
2564 Panel Report on Australia – Salmon , para. 8.123. 
2565 Panel Report on EC – Approval and Marketing of Biotech Products, para. 7.1416. 
2566 Panel Report on EC – Approval and Marketing of Biotech Products, para. 7.1417. 
2567 Panel Report on EC – Approval and Marketing of Biotech Products, para. 7.1415. 
2568 Ibid. 
2569 Appellate Body Report on EC – Hormones , para. 214 (original emphasis). 
2570 New Zealand's reply to Panel question 131  after the first substantive meeting. 
2571 Appellate Body Report on Australia – Salmon , para. 200 (footnote omitted;  original emphasis). 
2572 Panel Report on Australia – Salmon , para. 8.123 
2573 Ibid. WT/DS367/R 
Page 426  
 
 protection, "[w]hat a Member is comparing are the measures against the risks posed by potential 
hazards to human, animal or plant life or health."
2574 
7.979  Accordingly, the Panel will assess whether Aust ralia's measures reflect different ALOPs, 
by looking at both the measures applied by Austra lia in the various situations identified by 
New Zealand, and the risks against which such m easures are applied.  This  analysis involves an 
assessment of the Parties' arguments as regards the measures applicable in the comparable situations 
and the related risks against which th e measures in question are applied. 
7.980  The Panel will carry out this assessment under the second element of the Article 5.5 test.  
In this, the Panel follows the panel in Australia – Salmon  and the compliance panel in Australia – 
Salmon (Article 21.5 – Canada) . 
7.981  The panel in Australia – Salmon referenced the first element of the Article 5.5 test as 
"[d]istinctions in levels of prot ection for 'different situations'".2575  It analysed two aspects of this first 
element, "different situations"2576 and "difference in levels of protect ion", by declining to engage in a 
detailed analysis of the risk under both aspects.2577  As noted above, in regard to the first aspect 
("different situations") , the panel held that: 
"[A]t this stage of our examination we only address the question whether two 
situations can be compared under Article 5.5.   We do not examine nor decide at this 
point whether the risk (both in the sense of risk of entry, establishment or spread of 
the disease and the associated consequences) linked to these two situations is the 
same or has been addressed inconsistently .  This issue needs to be examined under 
the second element of Article 5.5."2578 
7.982  The panel adopted a similar approach to the sec ond aspect of the first element ("difference in 
levels of protection"): 
"To determine whether Australia makes a dis tinction in the levels of protection it 
considers to be appropriate for the situati ons compared, we thus need to examine the 
sanitary measures Australia currently imposes fo r these different situations.  Since we 
have found that these situations are comp arable as 'different situations' under 
Article 5.5 (because they have at least one disease agent in common and, presumably, also represent the same or similar biol ogical and economic consequences) and since 
we will consider the potential difference in th e degree of risk posed by these different 
situations under the second element of Ar ticle 5.5, we will for present purposes 
assume that if there is a difference in the sanitary measures imposed for the different 
situations we compare under Article 5.5, th is difference does reflect a distinction in 
levels of protection achieved in – and considered to  be appropriate by – Australia."
2579 
7.983  Likewise, the compliance panel in Australia – Salmon (Article 21.5 – Canada)  held that the 
situations in question were comparable under Article  5.5, and then explicitly declined to assess under 
the first element of the Article 5.5 test whether Au stralia adopted different ALOPs in regard to these 
                                                      
2574 SPS Committee's Guidelines to further the practical implementation of Article 5.5  (G/SPS/15), 
18 July 2000, para. B.2.  See also, SPS Committee's Guidelines to further the practical implementation of 
Article 5.5  (G/SPS/15), 18 July 2000, para. A.4. 
2575 Panel Report on Australia – Salmon , p. 174, DSR 1998:VIII, 3410, at 3640. 
2576 Panel Report on Australia – Salmon , p. 175, DSR 1998:VIII, 3410, at 3642. 
2577 Panel Report on Australia – Salmon , p. 178, DSR 1998:VIII, 3410, at 3646. 
2578 Panel Report on Australia – Salmon , para. 8.118. 
2579 Panel Report on Australia – Salmon , para. 8.124.  WT/DS367/R 
 Page 427 
 
 
 different situations.  "Whether or not Australia adopts different ALOP's in respect of these 'different 
situations' is an issue we address under the second element of Article 5.5."2580 
7.984  The Panel will adopt a similar approach in th e current dispute.  It will assess under the second 
element of the three-pronged Article 5.5 test wh ether the measures applied by Australia in the 
different situations result in a different de facto  ALOP. 
7.985  The Panel is cognizant that in EC – Hormones the Appellate Body referenced "three distinct 
elements" that need to be addressed under Article 5.5.2581  However, this dispute has specific 
circumstances in that New Zealand contests alleged differences in the level of protection achieved in 
practice by the measures applied in comparable situ ations, despite Australia's generically stated 
ALOP.  Given these special circumstances, the Panel finds it appropriate to refrain from a detailed 
analysis of risks under the first element of the Ar ticle 5.5 test, and to assess under the second element 
of this test whether there is a difference in the le vels of protection achieved by the measures applied in 
the different situations at issue. 
7.986  Indeed, the second element of the Article 5.5 test  is concerned with whether any distinctions 
in the ALOP in different situations are arbitrary or unjustifiable.  In the light of New Zealand's 
arguments in this dispute, in effect this involv es a comparison between the measures Australia applies 
to achieve its ALOP in the different situations and the risks against which such measures are applied.  
As explained above, the analysis of any distinctio ns in ALOP in this di spute involves the same 
exercise in the light of New Zealand's arguments. 
7.987  The Panel will assess under the second element of the Article 5.5 test whether Australia 
applies measures to achieve its generically stated  ALOP in a way that leads to arbitrary or 
unjustifiable distinctions in the de facto ALOP applied in the situations that have been found to be 
comparable.  If the Panel finds that this is the case, it will complete its current analysis under the first 
element of the Article 5.5 test by finding that there are indeed distinctions in the levels of de facto 
ALOP adopted by Australia, despite Australia's ge nerically stated ALOP.  Logically, if there are 
arbitrary or unjustifiable distinctions in the de facto ALOP, there will be distinctions in the ALOPs 
achieved by the measures applied by Australia in th e comparable situations.  Alternatively, if the 
Panel finds under the second element of the Article 5.5 test that there are no arbitrary or unjustifiable distinctions in the de facto ALOP adopted by Australia, there will be no need to complete its current 
analysis of the first element.  As the Appellate Body explained in EC – Hormones , "the three elements 
[of the Article 5.5. test] are cumulative in nature;  all of them must be demonstrated to be present if 
violation of Article 5.5 is to be found."
2582 
(b) The second element of Article 5.5 
7.988  In the light of the language of Article 5.5 and the guidance of the Appellate Body2583, the 
second element of the three-pronged Article 5.5 test is whether there are arbitrary or unjustifiable 
distinctions in the ALOP achieved by the measures applied by Australia  in the different situations.  
As explained above, the Panel will assess this by comparing the risks involved in the comparable 
situations and the measures applied by Australia against such risks. 
7.989  The Panel is aware that this requires a very delicate balancing act between carrying out a 
meaningful and objective analysis of the Partie s' arguments and evidence, and refraining from a 
                                                      
2580 Panel Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.89. 
2581 Appellate Body Report on EC – Hormones , para. 214. 
2582 Appellate Body Report on EC – Hormones , para. 215. 
2583 Appellate Body Report on EC – Hormones , para. 214;  and Appellate Body Report on Australia – 
Salmon , para. 154. WT/DS367/R 
Page 428  
 
 de novo review of the risks involved in the different situ ations, in particular in the context of nashi 
pears, which is only a comparator product in this dispute.  The Panel finds the detailed guidance from 
the panel in Australia – Salmon  particularly relevant, and quotes it in full here: 
"[A]ccording to Article 5.5 and our manda te set out in Article 11 of the DSU 
(to make an 'objective assessment of the ma tter before [us], including an objective 
assessment of the facts of the case'), we are called upon in this case to make th[e] 
comparison [of the levels of protection relate d to the comparable situations] and to do 
so on the basis of the evidence before  us.  We cannot conduct our own risk 
assessment.  Nor do we attempt to do so in this report.  The fact that one of the experts advising the Panel stated that 'if you are trying to say which [of two products] 
is the most risky, then you need to know something about and possibly do a full 
assessment for [the other] product'
 and that 'it would be sensible to assess that which 
you have prioritized initially to have the high est risk first, but until you have done the 
risk assessment, you actually cannot be sure you have got that right', does not change 
our position.  Nor do we disagree with these st atements.  Indeed, for a scientist to say 
with scientific certainty that one product re presents a higher risk than the other, there 
may be a need to have two, more or less, complete sets of data, including two risk assessments. And even on that basis a scientis t would probably not be able to state 
with absolute certainty that one product is  riskier than the other. Our mandate is 
different.  We are not asked to make a sci entific risk comparison nor to state with 
scientific certainty that one product is risk ier than the other.  We can only weigh the 
evidence put before us and, on the basis of  the rules of burden of proof we adopted, 
including the use of factual presumptions , decide whether sufficient evidence is 
before us – evidence which has not been re butted – in order to state that it can be 
presumed that one product is riskier than the other."
2584 
7.990  Likewise, in the present case, the Panel will we igh the evidence put forward by New Zealand 
and Australia and decide whether New Zealand has made a prima facie case, not rebutted by 
Australia, that it can be presumed that one product is  riskier than the other.  The Panel will compare 
the risks involved in each of the two pairs of  comparable situations in this dispute. 
7.991  The Panel notes that Annex A(4) of the S PS Agreement defines "Risk assessment" as: 
"The 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;  or the evaluation of the potential for adverse 
effects on human or animal health arising from the presence of additives, contaminants, toxins or disease-causing organi sms in food, beverages or feedstuffs." 
7.992  Based on this provision, the Guidelines to Furthe r the Practical Implementation of Article 5.5 
define risk as follows: 
"'Risk' in the context of the SPS Agreement refers to the likelihood that an adverse 
event (pest or disease) will occur and
 the magnitude of the associated potential 
                                                      
2584 Panel Report on Australia – Salmon , para. 8.126.  WT/DS367/R 
 Page 429 
 
 
 consequences  on plant or animal life or health of the adverse event, or to the potential 
for adverse effects  on human or animal life or health from food-borne risks."2585 
The Guidelines add that "[a]ccordi ngly, categorizing risks as 'similar'  must include a comparison of 
both the relevant likelihood and the corresponding consequences."2586 
(i) Comparison of the risks of European canker in New Zealand apples and of brown rot in 
Japanese nashi pears 
7.993  As regards the comparison of the risks associ ated with European canker in New Zealand 
apples and with Monilinia fructigena in Japanese nashi pears, New Z ealand argues that the risk of 
Japanese Nashi pears transmitting brown rot is not ju st comparable, but significantly higher than any 
risk of apples from New Zealand transmitting European canker.2587  In response, Australia argues that 
the risk associated with Japanese nashi pears is much  lower than the risk associated with New Zealand 
apples because both the likelihood and the consequences of the entry, establishment and spread of 
brown rot into Australia are lower than the like lihood and consequences associated with European 
canker in New Zealand apples.2588 
7.994  The Panel looks at seven different risk fact ors argued by the Parties in this context: 
(a) The facility of transmission of the two pest s – because, other things being equal, a 
more easily transmittable pest presents a higher risk; 
(b) The potential biological and economic conse quences of the pests – because, other 
things being equal, more serious  consequences entail a higher risk; 
(c) The range of host plants – because, other th ings being equal, a wider range of host 
plants for a pest results in a higher risk; 
(d) The presence of the pests in the exporting areas –  because, other things being equal, 
a pest present in exporting areas poses a higher risk than one that is not present; 
(e) The presence of the pests in Australia – because, other things being equal, as the 
compliance panel in Australia – Salmon (Article 21.5 – Canada) explained, a pest not 
present in, or in other words "exotic" to, the importing country "may be ... of more 
concern [than non-exotic pests] both in terms of risk of introduction of the disease 
and its potential impact"2589; 
(f) The volume of trade – because, as Dr Latorre and Dr Sgrillo explain, in general, as 
the volume of trade increases, so does the probability that a given biological event 
may occur;  and, 
                                                      
2585 SPS Committee's Guidelines to further the practical implementation of Article 5.5  (G/SPS/15), 
18 July 2000, footnote 2 (original emphasis).  See also, SPS Committee's Guidelines to further the practical 
implementation of Article 5.5  (G/SPS/15), 18 July 2000, para. A(4). 
2586 SPS Committee's Guidelines to further the practical implementation of Article 5.5  (G/SPS/15), 
18 July 2000, para. A(4). 
2587 New Zealand's first written subm ission, para. 4.442.  See also New Zealand's second written 
submission, paras. 2.832 and 2.864. 
2588 Australia's first written submission, para. 1006. 
2589 Panel Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.93. WT/DS367/R 
Page 430  
 
 (g) The efficacy of existing controls in Austra lia for the two pests in question – because, 
other things being equal, if Australian controls already in place are also effective against one of the pests in question, the risks from that pest are lower. 
Facility of transmission
 
7.995  New Zealand argues that brown rot presents a higher risk than European canker because 
brown rot is more easily transmitted than European canker.  "[T]he scientific evidence is clear that 
pears that are latently infected with brown rot do produce spores after removal from cold storage ... .  
... [T]his is not the case for European canker.  Pear s are therefore a potential vector of brown rot, 
unlike apples in respect of European canker."2590 
7.996  Dr Swinburne seems to agree with this point: 
"The risk posed by brown rot incited by M. fructigena  differs from that associated 
with N. galligena  in a number of important respects.   For example, it can spread from 
fruit to fruit in bulk bins leading to 'nesti ng', and thus inoculum enhancement, which 
is not found with N. galligena .  Rotted fruit almost invariably produce prolific 
numbers of conidia on sporodochia which form in concentric circles across the 
surface of the rotted area.  The conidia are dispersed by wind alone and are thus not 
reliant on rain-fall.  This contrasts with N. galligena  in which spore production is 
relatively low and the spores are dispersed by rain splash (Byrde & Willetts, 1977;  Swinburne 1975)."
2591 
7.997  In the light of the above, and the Panel's findi ngs under Article 5.1 of the SPS Agreement in 
regard to European canker, the Panel finds that Ne w Zealand has demonstrated that brown rot can be 
more easily transmitted through fruit than European canker. 
Potential biological and economic consequences  
7.998  As to the potential biological and economic consequences of the two pests, New Zealand 
argues that both diseases cause fruit rots in apples and pears.2592  Dr Latorre points out that "there is 
not enough published information to allow an ad equate comparison of the risk of entrance, 
establishment and spread between brown rot and Europ ean canker."  Nevertheless, he explains that in 
general the potential biological and economic con sequences of the two pests could be similar, 
although he emphasizes that this also depends on weather conditions: 
"The biological impact of both diseas es would be highly dependent on weather 
conditions during fruit maturity.  Among other factors, the severity of both diseases depends on the presence of frequent rains during harvest.  If this is accepted, the 
economic and biological impact on Australian agriculture, particularly for apple and 
pear production, would be similar. 
"... Brown rot rarely causes economical losses, unless frequent summer rains occur, it 
is weather dependant.  The same is true for European canker."
2593 
                                                      
2590 New Zealand's first wr itten submission, para. 4.441 (footnote omitted). 
2591 Dr Swinburne's reply to Panel question 61, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 381. 
2592 New Zealand's first writte n submission, para. 4.440. 
2593 Reply of Dr Latorre to Panel question 61, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 379-380.  WT/DS367/R 
 Page 431 
 
 
 7.999  The Panel notes that New Zealand has not s ubmitted evidence on the weather conditions in 
Japanese nashi pear-producing areas. 
7.1000  Australia argues that, in its environment, the consequences of Monilinia fructigena  are less 
severe than those of European canker.2594  Dr Deckers supports this view by explaining that European 
canker has more pernicious biological consequences: 
"The introduction of brown rot on pear would surely create a large problem of rotting 
phenomena on different fruit species.  But the introduction of European canker should not only create rotten fruit problems but also problems of NG infections on branches or on the rootstock and can even kill fruit trees completely.  The impact of NG on apple is thus more important than the impact of brown rot on pear."
2595 
7.1001  In the light of the expert views and in the absence of arguments from New Zealand on 
weather conditions for brown rot in Japan, the Pane l finds that New Zealand has not made a prima 
facie case that the potential biological and economic  consequences of brown rot in Japanese nashi 
pears are similar to, or more severe than, those of  European canker in New Zealand apples.  Indeed, 
although the Panel refrains from making a specifi c finding on this, it seems from Dr Deckers's 
statement that under certain circumstances brown ro t may have less severe potential biological and 
economic consequences than European canker. 
Range of host plants  
7.1002  New Zealand argues that brown rot has a wider range of host plants, given that it is also a 
significant disease of apricots, cherrys, peaches and plums, which European canker is not.2596  
Australia does not contest this.  Dr Swi nburne states that "the host range of M. fructigena , including 
as it does fruit types of importance to Australia, ... suggests that it poses a greater risk to commerce 
than N. galligena ."2597 
7.1003  The Panel therefore finds that New Zealand has demonstrated that brown rot has a wider 
range of host plants than European canker. 
Presence of the two pests in export areas  
7.1004  As indicated above, most apple export productio n in New Zealand takes place in areas where 
European canker has either never been recorded or  the disease occurs only sporadically in very wet 
seasons.2598 
7.1005  As regards brown rot, New Zealand argues th at brown rot has been observed in several 
prefectures in Japan since at least 1986.2599  New Zealand does not disput e Australia's contention that 
it has only ever imported Nashi pears from Tottori prefecture.  New Zealand also concedes that under 
the 2003 Arrangement, "apples [sic] are to be exporte d from an area (Tottori prefecture), which is 
certified as free from brown rot."2600  New Zealand argues, however, that it appears that Australia is 
                                                      
2594 Australia's first written submission, p. 302. 
2595 Dr Deckers's reply to Panel question 61, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 376. 
2596 New Zealand's first writte n submission, para. 4.440. 
2597 Dr Swinburne's reply to Panel question 61, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 382. 
2598 See para. 2.18 above. 
2599 New Zealand's first writte n submission, para. 4.440. 
2600 New Zealand's second writte n submission, para. 2.857. WT/DS367/R 
Page 432  
 
 content to manage risks on the basis of an assu mption and Japanese government assurances that pears 
would be sourced from a pest free area.
2601 
7.1006  Australia argues that it has only imported Japanes e nashi pears from Tottori.  Brown rot had 
occurred in Tottori but not since at least 1976, as confirmed by ten years of surveys and petal testing data supplied by Japan to support their access request in 1988.
2602  In fact, Japan's survey 
methodology was audited and verified by AQIS prio r to the commencement of trade, and since 1989 
Japan has provided Australia with over ten year s of survey, petal and flower testing data.2603  Tottori's 
freedom from brown rot was recognized in the im port conditions, which are based on the assumption 
that pears would be sourced only from Tottori.2604  As brown rot may have previously occurred in 
Tottori prefecture, Australia requires certificati on of area freedom by Japanese authorities through 
surveys and orchard inspections.  Further, area free dom in Tottori is a formal import requirement in 
respect of brown rot.2605  In the light of Article 6 of the SPS Agreement, Australia submits that its 
recognition of area freedom in relation to Japanese Erwinia  is clearly consistent with the 
requirements of the SPS Agreement.2606  By comparison, Australia argues, European canker is 
reported in several districts of New Zealand wher e apple export orchards are located.  New Zealand 
has not demonstrated that it has pr ocedures in place to establish, ma intain and verify either area 
freedom or areas of low pest preval ence in relation to European canker.2607 
7.1007  Dr Latorre and Dr Swinburne explain that if  Japanese nashi pears are exported effectively 
from pest-free areas, the risk involved in brown rot is lower than the risk of European canker in 
New Zealand apples.  Dr Latorre states that "Austra lia claims that pears are imported only from pest-
free areas ("areas of freedom"), which I assume was demonstrated previously.  If so, the likelihood of 
the entrance of M. fructigena  drops down considerably, to negligible."2608  Dr Swinburne agrees:  "if 
the Japanese pears are indeed coming from localities verifiably free of the disease then perhaps the 
risk is small."2609 
7.1008  The panel in Australia – Salmon explained that Article 5.5 involves a comparison between 
current situations.  "Article 5.5 directs us to comp are for different situations the related levels of 
protection as they are currently considered to be ap propriate by Australia and this whether or not the 
sanitary measures enacted to achieve that level are based on a risk assessment."2610 
7.1009  The Parties reference the 2003 Review of the Australian requirement for Petal Testing and 
Flower Cluster Examination at Blossoming for Po me Fruit from Japan, The Republic of Korea and 
The People's Republic of China as the most rece nt modification of Australia's import regime 
applicable inter alia to Japanese nashi pears.  As the 2003 Re view explains, "Nashi fruit has been 
imported into Australia from Tottori Prefecture in Honshu Island, Japan since 1989.  The quarantine 
                                                      
2601 New Zealand's second written submission, para. 2.835.  See also New Zealand's second written 
submission, para. 2.858. 
2602 Australia's reply to Panel question 119 after the second substantive meeting. 
2603 Australia's first written submission, para. 992. 
2604 Australia's first written submission, para. 988.  See also Australia's second written submission, 
para. 741 and Australia's comments on New Zealand's replies to Panel questions after the second substantive 
meeting, para. 218. 
2605 Australia's reply to Panel question 119 after the second substantive meeting. 
2606 Ibid. 
2607 Australia's first written submission, para. 993.  See also Australia's reply to Panel question 119 after 
the second substantive meeting. 
2608 Dr Latorre's reply to Panel question 61, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 378. 
2609 Dr Swinburne's reply to Panel question 61, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 382. 
2610 Panel Report on Australia – Salmon , para. 8.126.  WT/DS367/R 
 Page 433 
 
 
 measures for each season have b een mutually agreed through an annual 'Arrangement' between BA 
and Japan's MAFF.  The last 'Arrangement' signed in  October 2001 permits imports of nashi pear into 
Australia from 2001 until a review is deemed necessary."2611 
7.1010  Importantly, the 2003 Review was only a par tial review of Australia's SPS measures 
applicable to Japanese nashi pears.  In fact, the 2003 Review notes that its "scope is limited to existing 
requirements for petal and blossom cluster testing for brown rot ( Monilinia fructigena ), black spot 
(Alternaria gaisen ) and scab ( Venturia nashicola ) in Asian pome fruit orchards in Korea, Japan and 
China that are designated by quarantine authoriti es for the purpose of exporting fruit to Australia."2612 
7.1011  Under the header "Australia's concerns re garding diseases and existing risk management 
measures", the 2003 Review includes two Tottori-sp ecific "[q]uarantine measures implemented to 
address identified risk."  The first one expressly limits exports to registered orchards located in parts 
of Tottori prefecture by providing for "fruit to be sourced only from registered orchards in designated 
export areas of Tottori Prefecture".  The second Totto ri-specific measure is "orchard inspection for 
brown rot by MAFF – immediate notification by MAFF to BA if there is a detection of brown rot anywhere in Tottori Prefecture, including in unregistered orchards or household fruit trees."
2613 
7.1012  Further, the "amended import protocol for nashi pear fruit from Japan to Australia" resulting 
from the 2003 Review includes measures, which also seem to be based on the assumption that 
Japanese nashi pears would be exported to Australia only from Tottori prefecture: 
"1. Certification by Ministry of Agricultu re, Forestry and Fisheries (MAFF) that 
Tottori Prefecture is free from brown rot (Monilinia fructigena) and scab based on 
Prefectural surveys. If the level of black spot exceeds a threshold of 0.5% after 
orchard inspection, those orchards w ill be excluded from the export program. 
2. MAFF to inform BA immediately if there is a detection of M. fructigena 
anywhere in Tottori Prefecture, including in unregistered orchards or household fruit trees. 
3. Registration of orchards in export areas. 
Each orchard registered for export as a result of meeting conditions in (1) is to be 
numbered and the location identified by MAFF.  This information is to be given to 
the AQIS inspector by MAFF. 
4. MAFF to notify BA immediately if unusual weather conditions occur 
resulting in brown rot, black spot or scab in export orchards. 
[…] 
                                                     
 
2611 2003 Review of the Australian requirement for Petal Testing and Flower Cluster Examination at 
Blossoming for Pome Fruit from Japan, The Republic of Korea and The People's Republic of China, p. 26. 
2612 2003 Review of the Australian requirement for Petal Testing and Flower Cluster Examination at 
Blossoming for Pome Fruit from Japan, The Republic of Korea and The People's Republic of China, p. 13. 
2613 2003 Review of the Australian requirement for Petal Testing and Flower Cluster Examination at 
Blossoming for Pome Fruit from Japan, The Republic of Korea and The People's Republic of China, p. 26. WT/DS367/R 
Page 434  
 
 13. MAFF is to apply door seals to the sh ipping containers in Tottori and again 
after Customs' verification inspection in K obe port and ensure that the container 
numbers are correctly recorded on the phytosanitary certificates."
2614 
7.1013  In the light of the above, the Panel finds that  Australia has demonstrated that its current 
measures applicable to Japanese n ashi pears are based on the assumption that exports will be sourced 
only from Tottori prefecture.  The Panel notes in this  regard that New Zealand does not contest that 
since 1989 Australia has imported Japanese nashi pear s only from Tottori prefecture.  As mentioned 
above, New Zealand also concedes that freedom fro m brown rot is certified in Tottori prefecture.2615  
Also, as noted above, the 2003 Review limits Japane se nashi pear exports to Tottori prefecture. 
7.1014  Nevertheless, should the 2003 Review be read  as allowing imports from Japanese orchards 
outside of Tottori prefecture, the Panel notes that  the Review imposes several requirements to make 
sure that Japanese nashi pears may be exported only from orchards free from brown rot.  In fact, the 
2003 Review concludes that: 
"[I]t is proposed that the requirement for petal testing for brown rot 
(Monilinia fructigena ) and flower cluster examination for scab ( Venturia nashicola ) 
be removed, to be replaced by a requirement for orchard freedom from both diseases, 
as verified by orchard surveillance through the growing season. 
Orchards in which brown rot is identified w ill be deregistered by the NPPO and will 
not be allowed to export fruit to Australia.  Due to the potential for latent infections 
from external infection sources, the bag c overing the developing  export fruit is an 
essential and effective barrier to infecti on and a significant phytosanitary measure. 
NPPOs will be required to notify Australia of any detection of brown rot in fruit 
export regions and the measures that ha ve been taken to control outbreaks. 
[…] The import protocols contain a series of cont rols that will ensure that only fruit free 
from diseases of concern to Australia are allo wed for import. BA is confident that this 
change does not compromise the ALOP established through IRAs on pome fruit 
imports from Japan, Korea and China. 
Given the possibility of changes to the status  of the diseases in pome fruit orchards in 
Japan, Korea and China resulting from unusual weather conditions that give rise to 
conducive conditions for disease developmen t, BA has included an additional 
requirement stating that the quarantine authority in the exporting country must notify 
BA immediately if unusual weather conditions occur which result in disease 
development in export orchards above the thresholds indicated."
2616 
7.1015  Further, the part of the 2003 Review entitle d "Framework for Review" emphasizes the central 
role of area freedom as a precondition for Japanese nashi pear imports to Australia: 
"BA is to consider the removal of the requi rement for petal testing in export orchards 
for brown rot ( Monilinia fructigena ) and black spot ( Alternaria gaisen ), and flower 
                                                      
2614 2003 Review of the Australian requirement for Petal Testing and Flower Cluster Examination at 
Blossoming for Pome Fruit from Japan, The Republic of Korea and The People's Republic of China, 
Appendix 2, pp. 61-62. 
2615 New Zealand's second writte n submission, para. 2.857. 
2616 2003 Review of the Australian requirement for Petal Testing and Flower Cluster Examination at 
Blossoming for Pome Fruit from Japan, The Republic of Korea and The People's Republic of China, pp. 23-24.  WT/DS367/R 
 Page 435 
 
 
 cluster examination for scab ( Venturia nashicola ) in pear orchards designated to 
export pear fruit to Australia. BA will undert ake the review in accordance with the 
International Standards for Phytosanitary Measures (ISPM) developed by the FAO, in 
particular, Part 4 of the ISPM - Pest Surveillance:  Requirements for the 
establishment of pest free areas (ISPM No. 4, 1996). The three main components in 
establishing and maintaining a PFA are: 
1. systems to achieve area freedom 2. measures to maintain area freedom 3. procedures to verify maintenance of area freedom."
2617 
7.1016  As the experts explained, this significantly re duces the risk involved in the importation of 
Japanese nashi pears into Australia. 
7.1017  In the light of the above, the Panel finds that Australia has demonstrat ed that, even if its 
current measures applicable to Jap anese nashi pears should be read  as allowing imports from Japanese 
orchards outside of Tottori prefecture, these me asures ensure that Japanese nashi pears may be 
exported only from orchards free from brown rot. 
Presence of the two pests in Australia  
7.1018  As indicated above, European canker was identified in 1954 in four orchards in Spreyton, 
Tasmania, but was eradicated by 1991.2618 
7.1019  As regards brown rot, both Parties accept th at Australia is free of brown rot proper.2619  
Australia argues, however, that other species of brown rot are already present in Australia 
(for example, Monilinia laxa  and Monilinia fructicola ).  Since this is not the case for European 
canker, the economic impact for the Australian apple and pear industry would be lower if 
M. fructigena  were to establish in Australia than if Eu ropean canker were to establish in Australia.2620  
New Zealand responds that the other species of brown rot referred to by Australia ( M. fructicola  and 
M. laxa ) relate primarily to stone fruit.2621 
7.1020  As noted above, the compliance panel in Australia – Salmon (Article 21.5 – Canada) found 
that a disease exotic to the importing country invo lves a higher risk than a non-exotic disease.2622  
The Panel cannot tell whether this principle applies in  regard to brown rot and European canker in the 
current dispute, since neither Party has submitte d arguments concerning any similarities between 
brown rot proper and "other species of brown rot already present in Australia."2623  
                                                      
2617 2003 Review of the Australian requirement for Petal Testing and Flower Cluster Examination at 
Blossoming for Pome Fruit from Japan, The Republic of Korea and The People's Republic of China, p. 25. 
2618 See para. 2.18 above. 
2619 New Zealand's first written submission, para. 4. 440; and Australia's first written submission, 
para. 1004. 
2620 Australia's first written submission, para. 1004. 
2621 New Zealand's second writte n submission, para. 2.850. 
2622 Panel Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.93. 
2623 Australia's first written submission, para. 1004. WT/DS367/R 
Page 436  
 
 Volumes of trade
 
7.1021  New Zealand asserts that trade in nashi pear s from Japan is comparable to trade in 
New Zealand apples.2624  The 1998 Final Import Risk Analysis of the New Zealand Request for the 
Access of Apples into Australia accepted that "'trad e in pears from Japan is broadly comparable to the 
[New Zealand] proposal in that it involves trade in a susceptible host product from a country with a 
disease similar to fire blight'.2625"2626  According to the trade figures submitted by New Zealand, since 
2005 Japan has exported no pears and quinces to Australia.2627  New Zealand concedes that plant 
health status, trade volumes and risk management practices may change ove r time;  however, unless 
the ALOP also changes, it is entirely appropriate to  consider past situations as evidence of an ongoing 
breach of Article 5.5.2628  New Zealand adds that the ALOP is best ascertained by considering 
measures in the light of the risk as it exis ted at the time the measures were adopted.2629  A subsequent 
drop off in trade or eradication of a pest  does not change the ALOP being applied.2630  If the volume 
of trade is relevant at all, the relevance lies in the volume of trade as predicated at the time the 
comparator risk assessment was conducted.  Yet the 1988 investigation and measures imposed under 
the Quarantine Circular Memorandum made no assump tions about the potential volume of trade. 
Further, the risk management measures under the 20 03 Arrangement for the Shipment of Nashi Fruit 
from Japan to Australia are not limited to speci fic volumes.  There is nothing on the face of the 
Arrangement that indicates that at higher volumes , different measures would apply.  Moreover, 
nothing prevents Japan from re-establishing trade at any time and at any volume on the basis of the 
measures set out under the 2003 Arrangement.2631 
7.1022  Australia refers to the significantly differen t volumes of trade involved in the respective 
products.  Australia notes Dr Sgrillo's statement th at risk is directly proportional to the volume 
imported, and Dr Latorre's point that as the volume of trade increases, so too does the likelihood of a biological event occurring.
2632  Australia concedes that the 1998 Final IRA Report for New Zealand 
apples recognized that trade in nashi pears fro m Japan was broadly comparable to trade in 
New Zealand apples in that it involved a susceptible  host product (i.e. nashi pears) from a country 
with a disease similar to fire blight (i.e. Japanese Erwinia ).  However, the 1998 IRA also identified 
several fundamental differences between the two situ ations, one of which was the potential volume of 
trade.2633 
7.1023  Australia argues that if there is no trade in a pr oduct, there is no risk that a pest or disease will 
gain entry into a Member's territory via trade in that product.2634  Australia points out that there has 
been no trade in Japanese nashi p ears between Australia and Japan si nce 2003, when 36 tonnes were 
imported by Australia.  Prior to 2003, the maximum volume imported in any one year since 1994 was 
                                                      
2624 New Zealand's reply to Panel question 131  after the first substantive meeting. 
2625 (footnote original ) Exhibit AUS-112, Final Import Risk Analysis of  the NZ Request for the Access 
of Apples Into Australia (December 1998), p. 27. The statement is made  with reference to bacterial shoot blight 
(BSB), the disease name for Japanese Erwinia . 
2626 New Zealand's second writte n submission, para. 2.828. 
2627 New Zealand's reply to Panel question 120 after the second substantive meeting, Annex 2. 
2628 New Zealand's second written submission, paras. 2.823 and 2.824. 
2629 New Zealand's second writte n submission, para. 2.823. 
2630 Ibid. 
2631 New Zealand's second written submission, para. 2.838.  See also New Zealand's second written 
submission, para. 2.845. 
2632 Australia's comments on the experts' replies to questions 12 and 61, para. 271. 
2633 Australia's first written submission, para. 994. 
2634 Australia's first written submission, para. 995.  See also Australia's second written submission, 
para. 739.  WT/DS367/R 
 Page 437 
 
 
 86 tonnes.2635  These figures are confirmed by the trade figures submitted by New Zealand on pear 
(and quince) exports from Japan to Australia.2636  This is much lower than the likely volume of trade 
in New Zealand apples2637, estimated in the IRA as 150 million apples per year, or approximately 
27,000 tonnes.2638  Even New Zealand's more conservative estimate of 50 million apples 
(approximately 9,000 tonnes) per year dwarfs the past, and now non-existent, volume of trade in 
Japanese nashi pears.2639   
7.1024  In response to a question from the Panel whethe r Australia took into account volume of trade 
in its assessment of Japanese nashi p ears, Australia points out that, on the basis of the PRA for nashi 
pears in 1988-1989, a trial shipment of 5,600 cartons (roughly 101 tonnes) of nashi pears from Japan to Australia was conducted in 1989 to determine if  the proposed risk management measures would be 
successful.  Following that trial shipment, trade was allowed to continue, and up until 2003 the 
highest total volume of trade was 86 tonnes in 1994.  This is an evidence -based, consistently low 
volume of trade.  The low volumes of trade were also referred to in the 2003 review, which is the most recent assessment of unrestricted risk and measures associated with nashi pears from Japan.  
Further, the volume of trade for the trial ship ment was never exceeded in the following years.
2640 
7.1025  Australia agrees with New Zealand that Japan c ould seek to re-establish trade at any time.  
However, Japan could not re-establish trade unilatera lly.  Since there has been no trade in nashi pears 
in six years, and since there are currently no va lid import permits for the importation of nashi pears 
into Australia, Australia would reconsider th e relative risks associated with any proposed 
recommencement of trade, including with respect to th e likely volume of trade.  Further, it is highly 
improbable that trade which averaged around 37  tonnes per year between 1994 and 2003 would 
suddenly jump to between 9,000 and 27,000 tonnes per year.2641 
7.1026  Australia also notes that the IRA for New Zeal and apples provides for a review of the import 
conditions applying to New Zealand apples after one year of trade.  A similar review of the import 
conditions applying to Japanese nashi pears occu rred after taking into account surveys or export 
orchards, the history of trade and visits by Australian plant pathologists2642, and again in 2003.2643  
The reviews considered the results of orchard surveys,  petal and flower testing data, history of trade, 
and reports from Australian plant pathologists, orchard management programmes, AQIS inspector 
pre-clearance reports, and latency testing results.  Further, national surv eillance data by Japan's 
national plant protection organization indicated that the diseases of concern in the review had either 
not been reported for a number of years, or had occurred sporadically and were readily controlled by 
contemporary orchard management practices.  Import conditions were modified on the basis of these 
reviews.  Analysis of the outcomes of each measu re included in the existing importation conditions 
indicated areas of overlap between orchard surv eillance, disease management measures and disease 
tests. Where there was a clear redundancy in overlap ping measures, Biosecurity Australia considered 
that it would be possible to remove or modify them without loss of phytosanitary security.2644 
                                                      
2635 Australia's first written submission, para. 996.  See also, Australia's reply to Panel question 120 
after the second substantive meeting. 
2636 Australia's comments on New Zealand's replies to Panel questions after the second substantive 
meeting, para. 217. 
2637 Australia's first written submission, p. 300. 
2638 Australia's first written submission, para. 997.  See also Australia's second written submission, 
para. 739. 
2639 Australia's first written submission, para. 997. 
2640 Australia's reply to Panel question 121 after the second substantive meeting. 
2641 Ibid. 
2642 Australia's first written submission, para. 1019. 
2643 Australia's reply to Panel question 133 after the first substantive meeting. 
2644 Ibid. WT/DS367/R 
Page 438  
 
 7.1027  As the Panel noted above, the panel in Australia – Salmon explained that  an analysis of 
Article 5.5 involves a comparison between current situ ations.  "Article 5.5 directs us to compare for 
different situations the related leve ls of protection as they are currently considered to be appropriate 
by Australia and this whether or not the sanitary m easures enacted to achieve that level are based on a 
risk assessment."
2645 
7.1028  In the current dispute, Australia's de facto ALOP needs to be determined in part based on the 
risks related to Japanese nashi pear imports.  An impo rtant element of that risk is the volume of trade 
in Japanese nashi pears. 
7.1029  The May and September 1989 Quarantine Circul ar Memoranda both refer to a requirement 
for a trial shipment before the initiation of ex ports.  The September 1989 Quarantine Circular 
Memorandum also confirms Australia's argument th at the trial shipment involved 5600 cartons of 
Japanese nashi pears.2646  Australia alleges that this corres ponds to roughly 110 tonnes, and that up 
until 2003 the highest total of trade was 86 tonnes in  1994.  In other words, according to Australia, the 
volume of trade for the trial shipment was never exceeded in the following years.2647  New Zealand 
does not contest these arguments by Australia, nor  that the trial shipment has taken place. 
7.1030  Further, the 2003 Review references annual revi ews for Japanese nashi pears.  "Nashi fruit 
has been imported into Australia from Tottori Pref ecture in Honshu Island, Japan since 1989.  The 
quarantine measures for e ach season have been mutually ag reed through an annual 'Arrangement' 
between BA and Japan's MAFF.  The last 'Arrange ment' signed in October 2001 permits imports of 
nashi pear into Australia from 2001 un til a review is deemed necessary."2648  Presumably, these 
annual reviews provided an opportunity for Austra lia to adjust its measures should trade suddenly 
surge. 
7.1031  Also, the 2003 Review explicitly notes that it has taken the history of trade into account: 
"[H]istory of trade has been taken into account.  As a result of ongoing trade and 
dialogue with respective countries, AQIS and BA have devel oped a high level of 
confidence in the outcomes achieved by ph ytosanitary measures applied through the 
existing importation conditions.  They also have confidence in the verification and 
validation of measures by each of the N PPOs as evidenced through outturn and 
inspection and audit of the export pathway by AQIS officers and Australian technical 
experts.  The end result is that there have been no quarantine pests or diseases 
detected in imported pome fruit from North Asia."2649 
7.1032  As regards the period since 2003, Australia ar gues that there have been no Japanese nashi 
pear imports at all.  New Zealand does not contest this.  Japanese nashi pear exports could 
recommence subject at least to an import permit from Australia.  Nevertheless, as Australia argues, it is highly unlikely that they would surge above thei r previous levels.  New Zealand certainly has not 
provided any evidence to show why that should happen.   Accordingly, the Panel finds that the history 
of trade in Japanese nashi pears, including the lack  of trade in the last years, clearly informs 
Australia's current assumptions of the risks involve d in that product.  New Zealand has not brought 
forward evidence that would lead the Panel to disr egard Australia's assumption that any volume of 
                                                     
 
2645 Panel Report on Australia – Salmon , para. 8.126. 
2646 September 1989 Quarantine Circular Memorandum, p. 7. 
2647 Australia's reply to Panel question 121 after the second substantive meeting. 
2648 2003 Review of the Australian requirement for Petal Testing and Flower Cluster Examination at 
Blossoming for Pome Fruit from Japan, The Republic of Korea and The People's Republic of China, p. 26. 
2649 2003 Review of the Australian requirement for Petal Testing and Flower Cluster Examination at 
Blossoming for Pome Fruit from Japan, The Republic of Korea and The People's Republic of China, pp. 19-20.  WT/DS367/R 
 Page 439 
 
 
 imports of Japanese nashi pears would be significantly  lower than the volume of trade predicted for 
New Zealand apples in its IRA (approximately 27000 t onnes) or even that estimated by New Zealand 
(9000 tonnes). 
Existing controls in Australia  
7.1033  Australia argues that existing controls in Australia  reduce the risk of brown rot.  According to 
Australia, brown rot caused by M. fructigena , is only one  particular species of brown rot.  
Other species of brown rot are already present in Australia (for example, Monilinia laxa  and 
Monilinia fructicola ) and Australian industry already has c ontrols in place for these diseases that 
would also be effective for M. fructigena .  This is not the case for Eur opean canker.  Accordingly, the 
economic impact for the Australian apple and pear industry would be lower if M. fructigena  were to 
establish in Australia than if European  canker were to establish in Australia.2650 
7.1034  New Zealand responds that Australia's recent draft IRA for apples from China does not refer 
to any such effect.2651  The other species of brown rot referenced in Australia's arguments, namely 
M. fructicola  and M. laxa , relate primarily to stone fruit, so th e controls applied to stone fruit trees 
would not have any effect on the risk of infection of apple trees by M. fructigena .2652  F u r t h e r ,  
New Zealand contends, there are comparable controls  that would also be effective against European 
canker in Australia.  The IRA for New Zealand appl es notes that "'[c]ultural practices and chemical 
measures used to control apple scab … in most Australian apple-growing regions (except Western Australia) would assist in c ontrolling European canker'.
2653"2654 
7.1035  Dr Latorre seems to agree with this, stating that  "[s]everal of the fungicides used to prevent 
apple scab ( V. inaequalis ) can also control European canker."2655 
7.1036  Accordingly, the Panel finds that Australia ha s not made the case that there is a major 
difference between the two situations  in terms of existing controls. 
Overall consideration of the various risk factors  
7.1037  Having analyzed these seven risk factors argued by  the Parties, the Panel would need to draw 
conclusions as to how the overall risks regarding European canker in New Zealand apples compare 
with the overall risks for brown rot in Japanese nashi pears. 
7.1038  The Panel recalls that it is: 
"[N]ot asked to make a scientific risk comp arison nor to state with scientific certainty 
that one product is riskier than the other.  We can only weigh th e evidence put before 
us and, on the basis of the rules of burde n of proof we adopted, including the use of 
factual presumptions, decide whether suffici ent evidence is before us – evidence 
which has not been rebutted – in order to state that it can be presumed that one 
product is riskier than the other."2656 
                                                      
2650 Australia's first written submission, para. 1004. 
2651 New Zealand's second writte n submission, para. 2.849. 
2652 New Zealand's second writte n submission, para. 2.850. 
2653 (footnote original ) IRA, p. 148. 
2654 New Zealand's second writte n submission, para. 2.851. 
2655 Dr Latorre's reply to Panel question 61, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 380. 
2656 Panel Report on Australia – Salmon , para. 8.126. WT/DS367/R 
Page 440  
 
 7.1039  The above analysis of the seven factors argued by the Parties shows a mixed picture.  In light 
of the Parties' arguments and the evidence on record, some factors, namely the facility of transmission 
and the range of host plants, point towards a higher risk associated with brown rot.  Some others, 
namely volumes of trade and presence in export areas,  imply a higher risk of European canker in 
New Zealand apples.  In regard to existing controls , there appears to be no major difference between 
the two situations.  Two factors, potential biological and economic consequences and the presence of 
the pests in Australia, appear to be  inconclusive with regard to the risk of the comparable situations. 
7.1040  It would not be appropriate for the Panel to comp are the number of risk factors in favour of a 
higher risk of one or the other pest, and then conc lude that one comparable situation involves a higher 
risk than the other one.  Such a simplistic approa ch would disregard that overall risk results from 
various factors, where each factor has a specific weight .  In fact, it is possible that one single factor – 
with the proper weight attributed to it – might tilt the comparison of overall risks in favour of one or 
the other situation.  The Panel does not know what weight to attribute to the various factors, as 
New Zealand has not submitted any specific arguments in this regard.  Accordingly, the Panel cannot 
assess how the overall risks in the two compar able situations relate to each other. 
7.1041  In regard to the overall level of risks,  New Zealand argues that "Australia's ... Draft IRA 
Report – Fresh Apple Fruit from the People's Republic of China ..., released in January 2009,
2657 
identified the risk associated with M. fructigena  as higher than that associated with N. 
galligena.2658"2659  The same draft IRA also identified the consequences of M. fructigena  as higher 
than that associated with N. galligena .2660 
7.1042  This argument sounds appealing:  it suggests that  the defendant itself has found that brown rot 
poses a higher risk than European canker.  At th e same time, New Zealand refers to an assessment 
Australia made in the context of apple imports fro m China.  This is a distinct situation from both 
European canker in New Zealand apples and brown ro t in Japanese nashi pears.   Again, New Zealand 
has not provided any argument or evidence to dem onstrate how the situation of Chinese apple imports 
into Australia can be relevant for assessi ng a comparison between Japanese nashi pears and 
New Zealand apples.  Accordingly, the Panel finds New Zealand's reference to Australia's Draft IRA 
on Fresh Apple Fruit from the People's Republic of China unconvincing. 
7.1043  In the light of the above, the Panel does not have sufficient evidence from New Zealand to 
assess how the overall risks for European canker in  New Zealand apples compare with the overall 
risks for brown rot in Japanese nashi pears.  Con sequently, the Panel cannot continue its analysis 
under Article 5.5 with regard to the comparison of European canker in New Zealand apples and 
brown rot in Japanese nashi pears.  In fact, a comparis on of the risks in the two situations would be an 
essential element of the Panel's analysis of whethe r the two situations i nvolve distinctions, in 
particular arbitrary or unjus tifiable distinctions, in the de facto  ALOP reflected in the measures 
applied by Australia.  Since the Panel is not able to  compare the risks in the two situations, it will not 
engage in a detailed comparison of the measures that serve to achieve Australia's de facto ALOP. 
                                                      
2657 (footnote original ) Draft Import Risk Analysis Report for Fresh Apples Fruit from the People's 
Republic of China, January 2009 (Draft IRA – China Apples),  Exhibit NZ-128. 
2658 (footnote original ) The probability of entry, establishment and spread for M. fructigena  was 
assessed for Chinese apples as "hig h", and the overall unrestricted risk (both PEES and consequences) was 
assessed as "moderate": Draft IRA – China Apples, Exhibit NZ-128,  p. 131.  This is to be compared with the 
conclusions in respect of N. galligena  (described in the Draft IRA – Ch ina Apples with the alternate name  
N. Ditissima ), which was assessed in the Draft IRA – China A pples (consistent with the IRA for New Zealand 
apples) as "low" and "low" for PEES and overall unrestricted risk respectively. 
2659 New Zealand's second writte n submission, para. 2.843. 
2660 New Zealand's second writte n submission, para. 2.846.  WT/DS367/R 
 Page 441 
 
 
 7.1044  The Panel notes New Zealand's argument that th e measures applied by Australia in the two 
comparable situations show significant differen ces, which are indicative of an unjustifiable or 
arbitrary distinction in the ALOP.   However, as noted above, New Zeal and itself concedes that 
measures alone do not provide conclusive evidence in respect of Australia's ALOP.  In fact, 
New Zealand identifies risks as a key first element of the analysis of its Article 5.5 claim.  "While 
New Zealand agrees that measures alone do not constitute  conclusive proof of differences in levels of 
protection, if the risks associated with the compar able products are substantially the same, then the 
measures applied should be examined to determine whether they may reflect differences in the level 
of protection."2661 
7.1045  The Panel also recalls the Appellate Body's statement in EC – Hormones that Article 5.5 does 
not contain a legal obligation of absolute or perfect consistency between ALOPs in different 
situations: 
"The objective of Article 5.5 is formulated  as the "achieving [of] consistency in the 
application of the concept of appropria te level of sanitary or phytosanitary 
protection".  Clearly, the desired consistency is defined as a goal to be achieved in the 
future. ... We agree with the Panel's view that the statement of that goal does not 
establish a legal obligation of consistency of appropriate levels of protection.  We 
think, too, that the goal set is not absolu te or perfect consiste ncy, since governments 
establish their appropriate levels  of protection frequently on an ad hoc basis and over 
time, as different risks present themselves at different times. It is only arbitrary or unjustifiable inconsistencies that are to be avoided."
2662 
7.1046  Finally, the Panel recalls that Australia has a dopted the same generically stated ALOP in both 
situations.  In these circumstances and in the lig ht of the foregoing arguments, without a better 
understanding of how the overall risks involved in the two situations relate to each other, the Panel 
concludes that New Zealand has not demonstrated th e second element of the Article 5.5 test in regard 
to the comparison of European canker in New Zealan d apples with brown rot in Japanese nashi pears.  
Accordingly, the Panel also concludes that Ne w Zealand has not demonstrated that there are 
distinctions in the levels of protection actually ach ieved by the measures applied in the two situations, 
which is the outstanding part of the fi rst element of the Article 5.5 test. 
(ii) Comparison of the risks of fire blight in New Zealand apples and of Japanese Erwinia in 
Japanese nashi pears 
7.1047  New Zealand argues that Australia seeks to elimin ate completely the negligible risk of fire 
blight being vectored by New Zealand apples, yet it is willing to tolerate, without any efforts at 
mitigation, the risk of Japanese Erwinia  from Japanese pears.  New Zealand adds that given the 
comparable risk profiles at issue, the significant di fference in treatment constitutes an arbitrary and 
unjustifiable distinction in the levels of protection.2663 
7.1048  Australia argues that since both the likelihoods and the consequences of entry, establishment 
and spread into Australia in relation to Japanese Erwinia  are lower than the associated likelihoods in 
relation to fire blight, the risk associated with Japanese nashi pears is much  lower than the risk 
associated with New Zealand apples.2664  As a result of this lower risk, different measures are required 
                                                      
2661 New Zealand's reply to Panel question 131  after the first substantive meeting. 
2662 Appellate Body Report on EC – Hormones , para. 213. 
2663 New Zealand's first writte n submission, para. 4.445. 
2664 Australia's first written submission, para. 1006. WT/DS367/R 
Page 442  
 
 in order to achieve Australia's ALOP.  Australia  asserts that New Zealand ignores these important 
points, and thereby fails to establish that Austra lia's measures in practice reflect different ALOPs.
2665 
7.1049  For the reasons explained earlier, the Panel w ill assess the following thr ee risk factors argued 
by the Parties in this context: 
(a) the presence of the two pests in export areas; 
(b) the presence of the two pests in Australia;  and 
(c) the potential biological and economic conse quences of the two pests, including the 
range of host plants. 
7.1050  In addition, the Panel recalls its earlier analysis on volume of trade in Japanese nashi 
pears.2666 
Presence of the two pests in export areas  
7.1051  New Zealand argues that, to determine any diffe rences in ALOP, one needs to consider the 
pest status at the time the comparable risk was assessed.  Japanese Erwinia  was reported in Japan in 
1972 and may have been present in Japan from the early 1900s.2667  Eradication was not claimed until 
2003.2668  Still, the 1988 investigation by AQIS into pest  risk associated with the import of nashi pears 
did not assess the risks associated with Japanese Erwinia .2669  Despite the presence of 
Japanese Erwinia  in Japan, it was not analysed as part of any pest risk analysis and no measure 
requiring area freedom from the pest in export areas w as adopted.  It appears that Australia is content 
to rely on assurances that Japan (including Tottori Prefecture) is free from Japanese Erwinia .2670  
In fact, to this day, no measures are in place to en sure that Tottori Prefecture is and remains free of 
Japanese Erwinia .  The only reference to Japanese Erwinia in the 2003 Arrangement is a requirement 
that the Japanese Ministry of Agriculture Forestry  and Fisheries notify Biosecurity Australia should 
there be an outbreak "in Hokkaido or elsewhere in Japan".  There is no explicit requirement to notify 
Biosecurity Australia if there is an outbreak in  Tottori Prefecture (the only prefecture from which 
nashi pears are allegedly exported to Australia).  Further, the consequence of notification of an 
outbreak is discretionary.  Import conditions coul d be reviewed under the Arrangement.  However, 
despite Australia’s assertion in its responses to Panel questions that such a review would, "of course" 
follow, this is not in fact a requirement under the Arrangement.2671 
7.1052  Australia argues that the geographic area relevant  to the risk associated with the importation 
of nashi pears to Australia is Tottori  prefecture – not the whole of Japan.2672  Japanese Erwinia  was 
restricted to Hokkaido island in Japan, whereas Au stralia has imported nashi pears only from Tottori 
prefecture on Honshu island, which is free from Japanese Erwinia  and geographically remote from 
                                                      
2665 Australia's first written submission, para. 1018.  See also Australia's first written submission, 
para. 1009. 
2666 See paras. 7.1021-7.1032 above. 
2667 New Zealand's first writte n submission, para. 4.436. 
2668 New Zealand's reply to Australia's question 16 after the second substantive meeting, para. 39. 
2669 New Zealand's second writte n submission, para. 2.837. 
2670 New Zealand's reply to Australia's question 16 after the second substantive meeting, para. 39. 
2671 New Zealand's second writte n submission, para. 2.859. 
2672 Australia's comments on New Zealand's replies to Panel questions after the second substantive 
meeting, para. 218.  WT/DS367/R 
 Page 443 
 
 
 Hokkaido.  Australia has never imported nashi pears from Hokkaido,  and the import conditions are 
based on the assumption that pears would be sourced only from Tottori.2673 
7.1053  Australia recognizes that the 1989 pest risk anal ysis for Japanese nashi pears did not mention 
Japanese Erwinia .  However, Australia argues that, at the Panel's meeting with the experts, 
Dr Schrader confirmed that there is no need to assess the risk of a pest or disease which does not 
occur in the geographical area in relation to which a risk assessment is conducted.  ISPM No. 11 also 
supports this view.  Accordingly, Japanese Erwinia  was not, and is not, a pest relevant to the 
importation of nashi pears from Tottori prefecture in Japan.2674 Given the limitation of nashi pear 
exports to Tottori prefecture, Japanese Erwinia is not, and never has been, a pest of direct concern in 
relation to trade in Japanese nashi pears to Australia.2675  In the light of Article 6 of the 
SPS Agreement, Australia argues that its recognition of area freedom in Tottori prefecture in relation 
to Japanese Erwinia  is consistent with the requirements of the SPS Agreement.2676 
7.1054  New Zealand responds that Article 6 of the SPS Agreement also provides that: 
"Exporting members claiming that areas with in their territories are pest- or disease-
free areas … shall provide the necessary evidence thereof in order to objectively 
demonstrate to the importing Member that such areas are, and are likely to remain 
pest- or disease-free areas …  For this purpose, reasonable access shall be given, upon request, to the importing member for in spection, testing and other relevant 
procedures." 
New Zealand argues that there is no evidence that AQ IS was ever involved in auditing any surveys for 
area freedom done by MAFF in Tottori or anywhere else in Japan.
2677 
7.1055  In any event, Australia adds, Japan no tified to the IPPC the eradication of Japanese Erwinia  
from Hokkaido in 20032678, resulting from intensive emergency co ntrols to eradicate the disease.2679  
As a result of the review of the import conditi ons applying to Japanese nashi pears conducted by 
Biosecurity Australia in 2003, and taking into accoun t Japan's eradication notification, Australia now 
requires Japan's Ministry of Agriculture, Fisheries a nd Forestry to notify Biosecurity Australia of any 
further detection of Japanese Erwinia  in Hokkaido or elsewhere in Japan.  To date, no such 
notifications have been made to Biosecurity Austra lia, but in the event of notification of an outbreak 
of Japanese Erwinia  in Japan, Australia would review  the relevant import conditions.2680 
7.1056  In effect, Australia argues, the notifi cation requirement of any outbreaks of Japanese Erwinia  
anywhere in Japan operates as an area freedom requirement:  Tottori prefecture must remain free from Japanese Erwinia .
2681  The efficacy of the requirement was confirmed in November 2008, when Japan 
notified Australia of an outbreak of a "Bacterial Bl ack Shoot disease of European pear" in Yamagata 
prefecture, a geographical area again remote from Tottori prefecture.  The disease is reportedly a "new 
                                                      
2673 Australia's first written submission, para. 988.  See also Australia's second written submission, 
para. 741 and Australia's comments on New Zealand's replies to Panel questions after the second substantive meeting, para. 218. 
2674 Australia's reply to Panel question 119 after the second substantive meeting. 
2675 Australia's comments on New Zealand's replies to Panel questions after the second substantive 
meeting, para. 218. 
2676 Australia's reply to Panel question 119 after the second substantive meeting. 
2677 New Zealand's comments on Australia's reply to Panel question 119 after the second substantive 
meeting, para. 275. 
2678 Australia's first written submission, para. 989. 
2679 Australia's reply to Panel question 132 after the first substantive meeting. 
2680 Ibid.  See also, Australia's first written submission, para. 989. 
2681 Australia's second written submission, para. 740. WT/DS367/R 
Page 444  
 
 bacillus of the Erwinia  genus", but it is distinct from Erwinia amylovora .  As a result of this 
notification, Australia immediately suspended the issuance of import permits for Japanese nashi pears 
until further information is obtained.
2682 
7.1057  Australia contends that the only requirement in place for Japanese Erwinia , namely that 
Japan notify Australia of any future outbreaks of the disease anywhere in Japan, was included in the 
2003 review as a result of the 1995 outbreak in Hokkaido.2683  No further requirements were deemed 
necessary, given the confinement of the outbreak to the geographically remote island of Hokkaido, the 
eradication programme implemented by Japan and the absence of Japanese Erwinia  occurrences 
elsewhere in Japan.2684 
7.1058  By comparison, Australia argues, fire blight is widely distributed in the apple-growing areas 
of New Zealand, and New Zealand has not provided  evidence to confirm that it has procedures in 
place to establish, maintain and verify areas free from the disease.2685  If the disease is no longer 
present in Hokkaido, and Australia imports nashi p ears only from Tottori prefecture, the basis for a 
comparison of the likelihood of entry, establishmen t and spread (along with the basis of comparison 
of risk) disappears.2686 
7.1059  New Zealand responds that in regard to Japanese Erwinia , Australia simply relies on a 
generic notification to the IPPC in 2003 that Japanese Erwinia  is absent from Japan, which post-dates 
the commencement of trade, and a requirement th at Australia be notified should it reoccur – the 
efficacy of which may be called into question.  New Zealand notes that Australia exhibits a letter from November 2008 which refers to an outbreak of bacterial black shoot disease of European pear 
(belonging to the same genus with the pathogenic bacteria of fire blight Erwinia amylovora ) in 
Yamagata prefecture.
2687 However, the Japanese notification rela ted to an outbreak reported one and a 
half years earlier – hardly a demonstration of a f unctioning area freedom requirement.  In response to 
this belated notification (by which stage Japan had in fact taken measures to protect and confine the 
organism and no further detections had been made),  Australia asserts that it immediately suspended 
the issuance of import permits, although it provides no evid ence of this. Indeed, in the light of the fact 
that no imports have occurred since 2003, this presumably amounted to doing nothing.2688 
7.1060  Dr Paulin notes that: 
"The key-difference between the two situations , as far as risk associated with fruits is 
concerned, is that, according to Australia  (following Japan statement), this disease 
caused by Erwinia sp. on Nashis is present only  in the Hokkaido Island.  This allows 
Australia to import fruits from an other area,  remote from Hokkaido.  This is a clear 
objective difference between Erwinia /Japan, and E. amylovora /New Zealand 
situations."2689 
                                                      
2682 Australia's reply to Panel question 119 after the second substantive meeting. 
2683 Ibid. 
2684 Ibid. 
2685 Australia's first written submission, para. 990.  See also Australia's reply to Panel question 119 after 
the second substantive meeting. 
2686 Australia's first written submission, para. 989. 
2687 Ministry of Agriculture, Forestry and Fisheries,  Japan "Detection and measures of Bacterial Black 
Shoot disease of European pear (provisional name)", MAFF press release, 6 November 2008 (English translation provided by Australia), in Exhibit AUS-174. 
2688 New Zealand's comments on Australia's reply to Panel question 119 after the second substantive 
meeting, para. 272. 
2689 Dr Paulin's reply to Panel question 12, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 108 (original emphasis).  WT/DS367/R 
 Page 445 
 
 
 7.1061  The Panel notes that the original pest risk analysis conducted by Australia in 1989 did not 
involve Japanese Erwinia .  Neither of the two Quarantine Ci rcular Memoranda identified by the 
Parties from May and September 1989 refer to that p est.  The Memoranda do not explain if this is 
because Dr Kable during his two visits did not encounter Japanese Erwinia in Tottori prefecture, or 
because he encountered the pest but did not consider  it to be of quarantine concern for Australia. 
7.1062  As Australia argues, the 2003 Review of the Australian Requirement for Petal Testing and 
Flower Cluster Examination at Blossoming for Po me Fruit from Japan, The Republic of Korea and 
The People's Republic of China includes the followi ng notification requirement:  "MAFF is to notify 
BA of any further detections of bacterial shoot b light (BSB) in Hokkaido or elsewhere in Japan as 
soon as confirmed."2690  New Zealand does not contest that this measure covers the pest referenced in 
this dispute as Japanese Erwinia . 
7.1063  As noted above, the panel in Australia – Salmon explained that Article 5.5 involves a 
comparison between current situations.  "Article 5.5 directs us to compare for different situations the 
related levels of protection as they are currently co nsidered to be appropriate by Australia and this 
whether or not the sanitary measures enacted to ach ieve that level are based on a risk assessment."2691  
The panel in Australia – Salmon added that:  "[t]o determine whethe r Australia makes a distinction in 
the levels of protection it considers to be appropria te for the situations compared, we thus need to 
examine the sanitary measures Australia curre ntly imposes for these different situations."2692 
7.1064  The Panel therefore needs to focus on the 2003 Review and the notification requirement spelt 
out in that review.  Indeed, the 2003 Review is the most recent reflection of Australia's de facto ALOP 
with regard to Japanese Erwinia . 
7.1065  The 2003 Review does not contain an explic it requirement for area freedom from 
Japanese Erwinia .  Still, as Australia argues, it is highly probable that notification of bacterial shoot 
blight would result in a suspension of trade in Japan ese nashi pears.  In the context of Fuji apple from 
Japan to Australia, the 2003 Review recognizes bact erial shoot blight of pear as a disease of 
quarantine concern to Australia, and prescribes immedi ate notification of the disease for Japan, to be 
followed by appropriate action by Australia: 
"Detection/monitoring surveys for pests a nd diseases must be conducted by MAFF in 
orchards registered for export within the designated areas.  MAFF must submit the results using a standardised reporting form at to BA.  The standardised reporting 
format is to be determined by MAFF.  These surveys must include ... bacterial shoot 
blight of pear ( Erwinia amylovora ) or related species ... .  The designated export areas 
must be free of th[is] disease[].  If any specified pest or disease or other exotic pest or 
disease of quarantine concern to Australia is  detected through detection/monitoring 
surveys or joint inspection of orchards, th en BA must be notified immediately for 
appropriate action to be taken."
2693 
7.1066  Further, the 2003 Review explicitly foresees the suspension of trade if bacterial shoot blight 
in pear is detected.  "MAFF has indicated that designated export ar eas are free from bacterial shoot 
blight of pear ( Erwinia amylovora ). MAFF will monitor for this exotic disease of quarantine concern 
and notify BA immediately if it is detected in the designated export areas.  If bacterial shoot blight of 
                                                      
2690 2003 Review of the Australian requirement for Petal Testing and Flower Cluster Examination at 
Blossoming for Pome Fruit from Japan, The Republic of Korea and The People's Republic of China, p. 63. 
2691 Panel Report on Australia – Salmon , para. 8.126. 
2692 Panel Report on Australia – Salmon , para. 8.124. 
2693 2003 Review of the Australian requirement for Petal Testing and Flower Cluster Examination at 
Blossoming for Pome Fruit from Japan, The Republic of Korea and The People's Republic of China, p. 45. WT/DS367/R 
Page 446  
 
 pear ( Erwinia amylovora ) or related species is found, impor ts will be suspended pending an 
investigation."
2694 
7.1067  Likewise, the 2003 Review explains that: 
"Bacterial shoot blight of pear caused by Erwinia amylovora , a disease similar to fire 
blight, is restricted to Chinese pear in Hokkaido, according to information provided 
by MAFF. Adequate internal quarantines must be maintained to prevent the 
movement of host material from Hokkaido into designated export areas to preserve the area freedom status for b acterial shoot blight of pear. Details of any changes to 
these control measures should be provided to BA . If this disease, or related species, is 
detected outside of Hokkaido then AQIS must  be notified immediat ely and trade will 
cease, pending the outcome of an investigation."
2695  
7.1068  Although these latter passages from the 2003 Review  relate to Japanese Fuji apples, they do 
reflect a general concern of Australia with bacteria l shoot blight and related species in Japanese pear.  
It is therefore highly probable that Japanese nashi pear imports would be suspended if Japan notified 
Australia of bacterial shoot blight and related species. 
7.1069  In principle, Australia's reliance on Japanese au thorities in this regard does not reduce the 
validity of this conclusion.  In fact, Annex A(6)  of the SPS Agreement defines "pest- or disease-free 
area" as "[a]n area, whether all of a country, part of  a country, or all or parts of several countries, as 
identified by the competent authorities, in wh ich a specific pest or disease does not occur." 
7.1070  Yet, the Panel notes the significant delay in Japan's 2008 notification to Australia of bacterial 
shoot blight of pear in Yamagata prefecture in mid-2007.  The notification indicates that Japan took 
steps to eradicate the disease, including by burning the trees affected, immediately after detection in 
mid-2007.  While this amounts to an effort by Japan to restore pest freedom as quickly as possible, the 
notification does not explain what steps were taken to prevent the transmission of the pest through 
exported fruit, either by Japan or Australia. 
7.1071  Having considered all of these points, the Panel finds that the 2003 Review does not include a 
de facto  requirement of area freedom from Japanese Erwinia . 
7.1072  At the same time, the Panel notes that New Zeal and does not contest Australia's argument that 
Japanese nashi pear exports have b een limited to Tottori prefecture, and that Tottori has been free of 
Japanese Erwinia .  New Zealand does not contest either that Japanese Erwinia or bacterial shoot 
blight in pears was present only in regions of Japan that are distant from Tottori prefecture. 
7.1073  The Panel has analysed above whether Austra lia effectively limited Japanese nashi pear 
exports to Tottori prefecture.  In the light of the relevant documents, th e Panel concluded that 
Australia applies a de facto limitation to that effect.  If that is the case, the risk arising from 
Japanese Erwinia in Japanese nashi pears is reduced.  The Pane l notes, in comparison, that fire blight 
is present in various apple production areas in New Zealand since 1919.2696 
7.1074  Even if Australia should not de facto limit the importation of Japanese nashi pears to Tottori 
prefecture, the Panel notes that in 20 03 Japan notified that it had eradicated Japanese Erwinia even 
from Hokkaido.  Again, New Zealand does not contes t this, but rather Australia's reliance on Japanese 
                                                      
2694 2003 Review of the Australian requirement for Petal Testing and Flower Cluster Examination at 
Blossoming for Pome Fruit from Japan, The Republic of Korea and The People's Republic of China, p. 46. 
2695 Ibid. 
2696 See para. 2.8 above.  WT/DS367/R 
 Page 447 
 
 
 assertions in this regard.  In the light of the de finition of pest-free areas in the SPS Agreement, in 
principle the Panel does not see any problem with Australia's reliance on statements by Japan's 
competent authorities.  In fact, Article 6 of the SPS Agreement implies a reliance in recognizing pest-free areas on statements by the exporting Member's authorities in regard to eradication programmes 
and control measures: 
"1. Members shall ensure that their sa nitary or phytosanitary measures are 
adapted to the sanitary or phytosanitary char acteristics of the area – whether all of a 
country, part of a country, or all or pa rts of several countries – from which the 
product originated and to which the product is destined.  In assessing the sanitary or phytosanitary characteristics of a regi on, Members shall take into account, inter alia , 
the level of prevalence of specific diseases or  pests, the existence of eradication or 
control programmes, and appropriate crite ria or guidelines which may be developed 
by the relevant international organizations. 
2. Members shall, in particular, recogni ze the concepts of pest- or disease-free 
areas and areas of low pest or disease prevalence.  Determination of such areas shall 
be based on factors such as geography, ecos ystems, epidemiological surveillance, and 
the effectiveness of sanitary or phytosanitary controls. 
3. Exporting Members claiming that areas within their territories are pest- or 
disease-free areas or areas of low pest or  disease prevalence shall provide the 
necessary evidence thereof in order to obj ectively demonstrate to the importing 
Member that such areas are, and are likely  to remain, pest- or disease-free areas or 
areas of low pest or disease prevalence, resp ectively.  For this purpose, reasonable 
access shall be given, upon request, to th e importing Member for inspection, testing 
and other relevant procedures." 
7.1075  The Panel concludes that, although the 2003 Review does not include a de facto  requirement 
of area freedom from Japanese Erwinia , it limits Japanese nashi pear imports to Tottori prefecture, 
and New Zealand does not contest Australia's argument that this prefecture has been free from 
Japanese Erwinia .  Accordingly, the Panel finds that Au stralia has demonstrated that it imports 
Japanese nashi pears from an area free from Japanese Erwinia .  Furthermore, in the meantime, the 
pest has been reported to have been eradicated from Japan, so even if Australia imported Japanese 
nashi pears outside of Tottori prefecture, those imports would come from areas free from Japanese 
Erwinia . 
Presence of the two pests in Australia
 
7.1076  Currently both pests are absent from Australia .  The Panel notes that Australia does not 
contest New Zealand's argument that Japanese Erwinia has not been detected in Australia.2697  
In comparison, as noted above, fire blight was det ected in Australia in the Melbourne Royal Botanic 
Gardens in 1997, but eradication efforts were undertaken and no further outbreaks have been 
reported.2698 
                                                      
2697 New Zealand's first writte n submission, para. 4.436. 
2698 Australia's first written submission, para. 77;  Austra lia's IRA, Part C, p. 107;  New Zealand's first 
written submission, para. 3.55. WT/DS367/R 
Page 448  
 
 Potential biological and economic c onsequences (range of host plants)
 
7.1077  New Zealand argues that Japanese Erwinia  and Erwinia amylovora  produce very similar 
symptoms2699, and the biological and economic conse quences of the diseases are also similar.2700  
Given the close similarities between Japanese Erwinia  and Erwinia amylovora , these pests also result 
in comparable biological and economic consequences for Australia.2701  New Zealand concedes that 
Japanese Erwinia has a narrower range of host plants, since in  the field it has been recorded only on 
pears, while Erwinia amylovora  appears on both pears and apples.2702  Nevertheless, New Zealand 
argues that Australia has a large domestic pear pr oduction industry, comprising more than 2.1 million 
trees with an annual fruit pr oduction of over 150,000 tonnes.2703  In 2007-2008, Australian pear 
production corresponded to 33 per cent of  total Australian pipfruit production.2704  Also, the IRA 
indicates that yield reduction as a result of a fire b light outbreak may be more significant for the pear 
industry than the apple industry.2705 
7.1078  Australia argues that the narrowe r range of host plants of Japanese Erwinia alone 
immediately differentiates the potential consequences of Japanese Erwinia  from fire blight.  
Given that the Australian industry produces roughly half as many pears as apples, the difference in 
potential economic consequences is obvious.2706  Accordingly, in Australia's circumstances, the 
consequences associated with Japanese Erwinia  are lower than those for fire blight.2707 
7.1079  Dr Deckers explains that the two diseases have quite similar symptoms: 
"There is a great similarity between the Japanese Erwinia associated with nashi pears 
and Erwinia  amylovora  on apples from New Zealand.  In both cases it concerns a 
bacterial disease on fruits ... . [..]  ... [T]he risk for epiphytical presence of the bacteria 
on the surface of the fruits is comparable for both bacteria and should ask for a 
comparable strategy to avoid entrance of the disease."2708 
7.1080  At the same time, Dr Deckers accepts Australia 's argument that the narrower range of host 
plants for Japanese Erwinia involves a lower risk for that pest.  " Japanese Erwinia  [is a bacterial 
disease] on pear and the other fire blight one on appl e and pear.  This distinction will of course have 
consequences for the global risk evaluation."2709 
7.1081  Likewise, Dr Paulin sees the two pests as rather similar, while he also attributes importance to 
the difference in range of host plants: 
"Otherwise it seems that the bacteria ( Erwinia -Japan and E. amylovora ) are very 
similar but not identical , and the symptoms seem similar as well, but Erwinia from 
Nashis shows a narrow range of host plan ts, which could account for lower risks 
                                                      
2699 New Zealand's first writte n submission, para. 4.437. 
2700 New Zealand's second writte n submission, para. 2.830. 
2701 New Zealand's first written subm ission, para. 4.438.  See also New Zealand's second written 
submission, para. 2.839. 
2702 New Zealand's first writte n submission, para. 4.437. 
2703 New Zealand's first writte n submission, para. 4.438. 
2704 New Zealand's second writte n submission, para. 2.839. 
2705 Ibid. 
2706 Australia's first written submission, para. 1000. 
2707 Australia's first written submission, p. 302. 
2708 Dr Deckers's reply to Panel question 12, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 107. 
2709 Ibid.  WT/DS367/R 
 Page 449 
 
 
 (limited to pears?).  To be honest it is im portant to recognise that little is known in the 
literature about this Nashi disease."2710 
7.1082  The Panel finds that New Zealand has not made a prima facie case that Japanese Erwinia in 
Japanese nashi pears and E. amylovora in New Zealand apples have comparable biological and 
economic consequences for Australia.  In addition, Australia has shown that the narrower host range 
of Japanese Erwinia would  likely  result in less severe biological and economic consequences of that 
disease than the consequences of Erwinia amylovora in New Zealand apples. 
Overall consideration of the various risk factors  
7.1083  Having analysed the various risk factors argued by  the Parties, the Panel would again need to 
draw conclusions on how the overall risks associated with Erwinia amylovora in New Zealand apples 
compare with the overall risks associated with Japanese Erwinia in Japanese nashi pears. 
7.1084  Three risk factors argued by the Parties, namely the volume of trade,  the potential biological 
and economic consequences (includi ng the range of host plants) and the presence of the pests in 
export orchards, seem to point towards a lower risk for Japanese Erwinia  in Japanese nashi pears.  As 
to the presence of the pests in Au stralia, there seems to be no difference between the two situations. 
7.1085  The Panel notes that New Zealand argues that Japanese Erwinia in Japanese nashi pears and 
Erwinia amylovora in New Zealand apples have "similar risk profiles".2711  Since three of the risk 
factors argued by the Parties in regard to these pests point towards a higher risk profile of Erwinia 
amylovora  and with regard to the fourth risk factor there seems to be no difference between the two 
situations, the Panel finds that New Zealand has not demonstrated that Japanese Erwinia in Japanese 
nashi pears and Erwinia amylovora in New Zealand apples have similar overall risk profiles.  In fact, 
it seems that Erwinia amylovora has the higher overall risk profile of the two pests. 
7.1086  The Panel notes New Zealand's argument that th e measures applied by Australia to the two 
comparable situations show significant differences, which may be indicative of an unjustifiable or 
arbitrary distinction in ALOP.   However, as noted  above, New Zealand itself concedes that measures 
alone are not conclusive in respect of Australia's ALOP. 
7.1087  The Panel also recalls the Appellate Body's statement in EC – Hormones that Article 5.5 does 
not involve a legal obligation of absolute or perfe ct consistency between ALOPs adopted in different 
situations.2712 
7.1088  Finally, Australia has the same generically stated ALOP for both situations.  In these 
circumstances and in the light of the foregoing argu ments, the Panel finds that New Zealand has not 
demonstrated the second element of the Article 5. 5 in the context of the comparison between 
Japanese Erwinia in Japanese nashi pears and Erwinia amylovora  in New Zealand apples.  
Accordingly, the Panel also concludes that Ne w Zealand has not demonstrated that there are 
distinctions in the levels of protection actually ach ieved by the measures applied in the two situations, 
which is the outstanding part of the fi rst element of the Article 5.5 test. 
                                                      
2710 Dr Paulin's reply to Panel question 12, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 109 (original emphasis). 
2711 New Zealand's reply to Panel question 131 after the first substantive meeting.  See also, 
New Zealand's first written submission, para. 4.445 and New Zealand's second writte n submission, para. 2.854. 
2712 Appellate Body Report on EC – Hormones , para. 213. WT/DS367/R 
Page 450  
 
 4. The Panel's conclusion on New Zealand's Article 5.5 Claim 
7.1089  The Panel has found in regard to both pairs of comparator situations advanced by 
New Zealand that New Zealand has not demonstrated  the second and the first elements of the three-
pronged Article 5.5 test. 
7.1090  As the Appellate Body explained, the three elemen ts of this tests are cumulative:  each has to 
be demonstrated by the complainant to prove a violation of Article 5.5 of the SPS Agreement.  
Accordingly, the Panel will not proceed to the th ird element, and dismisses New Zealand's claim 
under Article 5.5 of the SPS Agreement. 
E. N
EW ZEALAND 'S CLAIM UNDER ARTICLE  2.3 OF THE SPS A GREEMENT  
7.1091  In its panel request New Zealand claims a violation of "both sentences"2713 of Article 2.3 of 
the SPS Agreement, which reads: 
"Members shall ensure that their san itary and phytosanitary measures do not 
arbitrarily or unjustifiably discriminate between Members where identical or similar conditions prevail, including between their ow n territory and that of other Members.  
Sanitary and phytosanitary measures shall not be applied in a manner which would 
constitute a disguised restriction on international trade." 
7.1092  New Zealand's claim under Article 2.3 is conse quential on its claim under the first sentence of 
Article 5.5.  Referring to the Appellate Body report in Australia – Salmon , New Zealand argues that 
since Australia is in violation of its obligations under Article 5.5, it is accordingly also in violation of 
its obligations under Article 2.3.
2714  While Article 2.3 is more general than Article 5.5, a finding of 
violation will necessarily imply a violation of Article 5.5.2715  Where there is a relationship between 
two provisions such that proof of a breach of one implies a breach of the other, it is not necessary to 
explicitly establish inconsistency with  all of the terms in the provision for which a breach is implied.  
This is inherent in the notion that the breach is "implied" as opposed to established explicitly.2716 
7.1093  In response, Australia recognizes that "there is  a close relationship between Articles 2.3 and 
5.5 [of the SPS Agreement]", and agrees with New Zealand that Article 2.3 has a broader application 
than Article 5.5.  Accordingly, where a violation of Article 5.5 has been established, there is an 
implied violation of Article 2.3.2717 
7.1094  Australia points out that New Zealand's con sequential claim under Article 2.3 is entirely 
dependent on the result of its claims under Article 5.5.2718  New Zealand, however, fails to establish a 
violation of Article 5.5;  therefore its con sequential claim under Article 2.3 must also fail.2719  
Since New Zealand has not provided any separate ar guments or evidence in relation to its claims 
                                                      
2713 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A-2 to this report, p. 3.  See also New Zealand's reply to Panel question 
136 after the first substantive meeting. 
2714 New Zealand's first writte n submission, para. 4.483. 
2715 New Zealand's reply to Panel question 122 after the second substantive meeting.  See also 
New Zealand's reply to Panel question 137 after the first substantive meeting. 
2716 New Zealand's second writte n submission, para. 2.872. 
2717 Australia's reply to Panel question 137 after the first substantive meeting. 
2718 Australia's first written submission, para. 1068.  See also Australia's second written submission, 
para. 183 and Australia's reply to Panel question 122 after the second substantive meeting. 
2719 Australia's first written submission, para. 1068.  WT/DS367/R 
 Page 451 
 
 
 under Article 2.3, in effect it h as abandoned its Article 2.3 claim.2720  Because New Zealand has not 
presented substantive arguments in relation to Artic le 2.3, if the Panel finds consistency with 
Article 5.5, there will be no arguments or evidence for the Panel to take into account in deciding on 
consistency with Article 2.3.  Recalling the fundamental principle that a Member's measures are 
presumed WTO-consistent unless sufficient evidence is presented to the contrary, Australia's 
measures should therefore be presumed consistent with Article 2.3.2721 
7.1095  The Panel notes that New Zealand's claim under Ar ticle 2.3 is entirely dependent on its claim 
under Article 5.5 of the SPS Agreement.  Since th e Panel has dismissed New Zealand's Article 5.5 
claim, it also has to dismiss New Zealand's consequential Article 2.3 claim. 
F. NEW ZEALAND 'S CLAIM UNDER ARTICLE  5.6 OF THE SPS  AGREEMENT  
1. The Panel's approach to assessing New Zealand's claim 
(a) Three cumulative conditions of the Article 5.6 test 
7.1096  New Zealand claims that each of the 16 measures that remain at issue in this dispute2722 are 
inconsistent with Australia's obligations  under Article 5.6 of the SPS Agreement2723, which provides: 
"Without prejudice to paragraph 2 of Artic le 3, when establishing or maintaining 
sanitary or phytosanitary measures to achieve the appropriate level of sanitary or 
phytosanitary protection, Members shall en sure that such measures are not more 
trade-restrictive than required to achieve  their appropriate level of protection, 
taking into account technical and economic feasibility." 
7.1097  The footnote to Article 5.6 adds: 
"For the purposes of paragraph 6 of Article 5, a measure is not more trade-restrictive 
than required unless there is another me asure, reasonably available taking into 
account technical and economic feasibility, that achieves the appropriate level of 
sanitary or phytosanitary protection and is  significantly less restrictive to trade."2724 
7.1098  The Parties agree that three cumulative conditions need to be fulfilled to establish a violation 
of Article 5.6.2725  As the Appellate Body explained, to p ass this three-pronged test of Article 5.6, 
the complainant needs to demonstrate that another, alternative measure: 
"(1) is reasonably available taking into account technical and economic 
feasibility; 
                                                      
2720 Australia's first written submission, paras. 1 068-1069.  See also Australia's second written 
submission, para. 161. 
2721 Australia's reply to Panel question 137 after the first substantive meeting.  See also Australia's 
second written submission, paras. 183 and 1068. 
2722 Measure 12 relating to European Canker is no longer at issue in this dispute.  See para. 2.96 above. 
2723 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A-1 to this report, p. 3.  See also th e preliminary ruling, where the Panel 
found that "[it] understands that New Zealand has claimed that 'every measure ... [identified] in its panel request 
is inconsistent with each of the [nine] provisions referred to [in the panel request]'", including Article 5.6 of the SPS Agreement.  Australia – Apples , Communication From the Chairman of the Panel:  Preliminary Ruling by 
the Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, para. 10 (footnote omitted). 
2724 Footnote 3 to Article 5.6 of the SPS Agreement. 
2725 New Zealand's first written submission, paras. 4. 487-4.488;  Australia's first written submission, 
paras. 1073-1074. WT/DS367/R 
Page 452  
 
 (2) achieves the Member's appropriate level of sanitary or phytosanitary 
protection;  and 
(3) is significantly less restrictive to trade than the SPS measure contested."
2726 
7.1099  New Zealand argues that alternative measures to the 16 that remain at issue in this dispute 
fulfil these three cumulative conditions.  In partic ular, New Zealand identifies alternatives for the 
measures at issue relating to fire blight and Eur opean canker, and to ALCM, as well as for the three 
"[g]eneral"2727 measures that apply to all three pests.  Australia contests New Zealand's Article 5.6 
claim, arguing inter alia  that the alternatives identified by Ne w Zealand would not achieve Australia's 
ALOP and that, in any event, New Zealand has failed to properly identify certain alternative 
measures. 
7.1100  In light of these arguments, the Panel will struct ure its analysis of New Zealand's Article 5.6 
claim according to the three categories of measu res contested by New Zealand under Article 5.6, 
namely: 
(a) The measures at issue relating to fire blight and European canker; 
(b) The ALCM measure;  and, 
(c) The general measures. 
7.1101  Under each of these three categories, the Panel will assess what alternative measures 
New Zealand has properly identified, and whether the alternative measure satisfies the three-pronged 
Article 5.6 test. 
(b) The Panel's order of analysis of the three conditions of the Article 5.6 test 
7.1102  As to the order of analysis of the three conditio ns of the Article 5.6 test, Australia argues that 
the most logical starting point for the Panel would be the second condition, namely whether the 
alternative measures identified by Ne w Zealand achieve Australia's ALOP.2728  Australia submits that 
without first determining that a particular alternative measure achieves Australia's ALOP, it is 
meaningless to assess a particular alternative meas ure's relative trade-restrictiveness or reasonable 
availability.2729  Throughout its submissions, in the contex t of Article 5.6, Australia focuses on the 
second condition of the test. 
7.1103  New Zealand argues that Australia's assertion regarding the most logical starting point reveals 
that it does not contest that the alternative measure s proposed by New Zealand meet the first and third 
conditions of the Article 5.6 test.  In any event, New Zealand contends, regardless of which one of the 
three conditions is examined first, the conclusion will be that Australia has breached its obligations 
under Article 5.6 of the SPS Agreement.2730 
                                                      
2726 Appellate Body Report on Australia – Salmon , para. 194;  and Appellate Body Report on Japan – 
Agricultural Products II , para. 95. 
2727 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Anne x A-1 to this report, p. 3. 
2728 Australia's first written submission, para. 1075.  See also Australia's second written submission, 
paras. 154-155. 
2729 Australia's first written submission, para. 1075. 
2730 New Zealand's second writte n submission, para. 2.884.  WT/DS367/R 
 Page 453 
 
 
 7.1104  The Panel recalls that the three elements of the Article 5.6 test are cumulative.2731  
The Appellate Body explained in EC – Hormones  that the complainant must establish a prima facie 
case by presenting "evidence and legal arguments" su fficient to demonstrate that the defendant has 
breached its obligations with respect to a specific provision.2732  In the context of Article 5.6, 
the Appellate Body confirmed in a subsequent dispute that "[p]ursuan t to the rules on burden of proof 
... it was for the [complainant] to establish a prima facie  case that there is an alternative measure that 
meets all three elements under Article 5. 6 in order to establish a prima facie  case of inconsistency 
with Article 5.6."2733 
7.1105  New Zealand needs to demonstrate  that all three conditions of the Article 5.6 test are fulfilled. 
7.1106  Previous panels and the Appellate Body did not  establish a specific order for analysing the 
three conditions of the Article 5.6 test.  They followed different approaches.  In Australia – Salmon , 
the panel and the Appellate Body followed the or der of the three conditions as they appear in 
footnote 3 to Article 5.6 of the SPS Agreement:  they  analysed the first, the second and then the third 
condition.2734  Conversely, the panel in Japan – Agricultural Products II  analysed the first and third 
conditions of the Article 5.6 test be fore turning to the second condition.2735  The compliance panel in 
Australia – Salmon  (Article 21.5 – Canada) followed a third approach.  It first examined the second 
condition, which it described as the "most controve rsial element" of the three-pronged Article 5.6 
test.2736  After having found that the second condition was fulfilled, the compliance panel turned to the 
other two conditions.2737 
7.1107  In light of Australia's request, the Panel will follow the same sequence in the present dispute 
in regard to the pest-specific measures contested  by New Zealand (Measures 1-8 for fire blight, 
Measures 9-11 and 13 for European canker, and Measu re 14 for ALCM).  The Panel will first analyse 
whether the second condition of the Article 5.6 test  is fulfilled, namely whether the alternative 
measures properly identified by New Zealand for these pest-specific measures achieve Australia's 
ALOP.  Only if the Panel finds that the second conditi on is fulfilled, will it turn to the first and third 
of the three cumulative conditions under Article 5.6. 
7.1108  As regards the general measures (Measures 15-17), the Panel will start its analysis with the 
third prong of the Article 5.6 test, since it involv es the threshold issue whet her the alternative put 
forward by New Zealand can be usefully compared w ith these measures, or at least with Measure 15.  
If the Panel finds that the third condition of the Article  5.6 test can be and is fulfilled in regard to the 
general measures, the Panel will turn to the first and second conditions of the test. 
2. Measures at issue regarding fire blight and European canker 
(a) Alternative measure regarding fire blight and European ca nker identified by New Zealand 
7.1109  For the eight fire blight measures (Measures 1-8) and four European canker measures 
(Measures 9-11 and 13) at issue, New Zealand's fi rst written submission references one alternative 
measure, and argues that it would fulfil the thr ee cumulative conditions of the Article 5.6 test: 
                                                      
2731 Appellate Body Report on Australia – Salmon , para. 194;  and Appellate Body Report on Japan – 
Agricultural Products II , para. 95. 
2732 Appellate Body Report on EC – Hormones , para. 109. 
2733 Appellate Body Report on Japan – Agricultural Products II , para. 126. 
2734 See Panel Report on Australia – Salmon , paras. 8.167-8.183;  and Appellate Body Report on 
Australia – Salmon , paras. 194-213. 
2735 Panel Report on Japan – Agricultural Products II , paras. 8.72-8.104. 
2736 Panel Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.127. 
2737 Panel Report on Australia – Salmon (Article 21.5 – Canada) , paras. 7.146-7.152. WT/DS367/R 
Page 454  
 
 "There is a very simple and straightforw ard measure which accords with the scientific 
evidence on the transmission of fire blight and European canker that could have been 
imposed by Australia.  It is the restriction of imports to apple fruit that are mature 
and symptomless .  ... [S]uch a measure is reasonably available, it would achieve 
Australia's ALOP and it is significantly less trade restrictive than the measures 
imposed by Australia."
2738 
7.1110  Continuing, New Zealand refe rences two possible additiona l alternative measures for 
fire blight, although it then immediately discount s their relevance as proper alternative measures 
under its Article 5.6 claim: 
"With regard to fire blight, alternativ e measures that would also be reasonably 
available, be less trade restrictive and achieve Australia's ALOP include restricting 
apple fruit imports to those fruit that have been cold stored , or limiting imports to 
apples that are 'retail-ready packaged fruit.'   Such measures have little justification, 
however, as they would be based on an assu mption that mature, symptomless apples 
could be a vector for the transmission of fire blight.  Since there is no scientific basis 
for any such assumption, New Zealand will rest rict its consideration to the alternative 
measure of restricting imports to mature, symptomless apple fruit. "2739 
7.1111  Likewise, New Zealand references two possible additional alternatives for European canker, 
but immediately excludes their consideration as valid alternative measure s in the context of 
Article 5.6: 
"With regard to European canker, alternativ e measures that would also be reasonably 
available, be less trade restrictive and achieve Australia's ALOP include restricting 
imports of apples to those that are sourced  from 'pest-free places of production', to be 
determined by a single inspection of each  exporting orchard and maintained through 
controls on the subsequent movement of nursery stock , or limiting imports to apples 
sourced from areas of 'low pest prevalen ce' to be determined by inspection of a 
sample of orchards .  Again, such measures are without  justification, as they would be 
based on an assumption that mature, symp tomless apples could transmit European 
canker, and an assumption that the climatic  conditions in Australia are conducive to 
European canker establishing and spreading.  Since there is no scientific basis for 
either assumption, New Zealand will restrict  its consideration to the alternative 
measure of restricting imports to mature, symptomless apples. "2740 
7.1112  In light of these statements, Australia argues that for fire blight and European canker 
New Zealand has limited its Article 5.6 claim to a single alternative measure:  the restriction of imports to mature, symptomless apples.  Therefore,  Australia submits, the Pa nel should not consider 
the other four possible measures referenced by New Zealand as genuine alternatives under 
Article 5.6.
2741 
7.1113  New Zealand contests this, and reiterates that th e four additional alternatives it proposes are 
based on the incorrect assumption that mature, symp tomless apples are vectors for fire blight, and 
would therefore violate Articles 2.2 and 5.1 of the SPS Agreement: 
                                                      
2738 New Zealand's first wr itten submission, para. 4.489 (emphasis added). 
2739 New Zealand's first wr itten submission, para. 4.490 (emphasis added). 
2740 New Zealand's first wr itten submission, para. 4.491 (emphasis added). 
2741 Australia's first written submission, paras. 1087-1088.  WT/DS367/R 
 Page 455 
 
 
 "In its first written submission, New Zealand also identified various other alternative 
measures for fire blight, European ca nker and ALCM that would meet the 
requirements of Article 5.6, but which woul d still be more trade restrictive than 
required.  A measure limiting imports to apples that are retail-ready packaged fruit was identified.  Indeed, as noted above in respect of Article 5.1 and as confirmed by 
the experts, such a measure would effectively exclude the primary pathway for 
ALCM identified by the IRA.  In respect of fire blight, an alternative measure restricting apple fruit imports to those fruit that have been cold stored was noted.  
In respect of European canker, alternativ es such as restricting imports of apples to 
those that are sourced from 'pest-free places of production,' ... or limiting imports to 
apples sourced from areas of 'low pest prevalence' were identified. 
Australia argues in respect of those additi onal alternatives, that they should be 
ignored by the Panel because New Zealand 'cho se not to substantiate' them.  As made 
clear in New Zealand's first written submission, New Zealand considers that these 
alternative measures meet the requirements of Article 5.6 .  Relative to the measures 
imposed by Australia they are significantly l ess trade restrictive, reasonably available, 
and would meet Australia's ALOP.  However, given that th ese additional alternatives 
are based on the assumption that matu re, symptomless apples are vectors for fire 
blight and European canker, they are s till more trade restrictive than required and 
would not be consistent with Articles 2.2 and  5.1 of the SPS Agreement.  The fact that 
less trade restrictive measures than the me asures at issue are still more trade 
restrictive than required simply indicates th e severity of the b reach in this case. "
2742 
7.1114  In its response to the Panel after the second meeting, New Zealand elaborates on these points 
in regard to one of the four additional requi rements, namely the retail-ready requirement: 
"Contrary to Australia's claims, New Zealand has identified a retail ready requirement 
as an alternative to Australia's measures pur suant to Article 5.6.  See paragraph 4.490 
of New Zealand's first written submission and paragraph 2.894 of New Zealand's 
second written submission. 
As explained in New Zealand's written subm issions, relative to the measures imposed 
by Australia, a retail ready measure is signi ficantly less trade restrictive, reasonably 
available and would meet Australia's ALOP.  However, it is still more trade restrictive than a mature, symptomless appl es requirement.  Indeed, the fact that a 
retail ready requirement is less trade restrictive than the measures at issue, yet still 
more  trade restrictive than required simply indicates the severity of the breach of 
Article 5.6 in this case. 
As a result, the fact that New Zealand did not base its primary arguments under 
Article 5.6 on a retail ready measure do es not mean that there was no obligation on 
Australia to consider it under Article 5.1 and Annex A(4) .  It was a genuine, 
reasonable and feasible measure (though not, in New Zealand's view, the least trade restrictive one). 
Indeed, had the IRA come to an objectively justifiable conclusion that a retail ready 
measure was necessary, New Zealand may have accepted this. As explained in New Zealand's written submissions, in expressly requesting that the IRA Team 
evaluate a retail ready measure, New Zealand clearly indicated that it would be 
                                                     
 
2742 New Zealand's second written submission, paras.  2.894-2.895 (emphasis added).  See also 
New Zealand's reply to Panel questions 123 and 125 after the second substantive meeting. WT/DS367/R 
Page 456  
 
 prepared to accept such a requirement in  the event that Biosecurity Australia 
determined through a science-based assessment  of risk that it was necessary to meet 
Australia's ALOP."
2743 
7.1115  The Panel notes that New Zealand identifies the f our additional alternatives for fire blight and 
European canker as "various other alternative measures "2744, and asserts that they fulfil the three-
pronged Article 5.6 test.  At the same time, immedi ately after having identified these four alternatives 
in its first written submission, New Zealand discoun ts their relevance for its Article 5.6 claim as 
proper alternative measures for fire blight and Eu ropean canker.  In its subsequent submissions 
New Zealand insists that these measures should be considered as alternatives under its Article 5.6 
claim;  however, each time New Zealand does so, it  confirms its earlier argum ents for discounting the 
relevance of these measures for its Article 5.6 clai m.  Accordingly, the Panel considers that the 
restriction of imports to mature, symptomless appl es is the only alternative measure validly identified 
by New Zealand for its Article 5.6 claim in the context of fire blight and European canker. 
7.1116  Even if New Zealand had validly identified th e four additional alternatives, New Zealand 
argues that these measures are based on an unacce ptable assumption, and would therefore violate 
Articles 2.2 and 5.1 of the SPS Agreement.  The Pane l has found that there is no evidence in the IRA 
to support the contention that fire blight or Eu ropean canker may be intr oduced through trade in 
mature apple fruit.  Accordingly, the IRA's reasoning in this regard has been found by the Panel not to 
be coherent and objective and therefore the resulting measures in the IRA at issue in this dispute violate Articles 5.1, 5.2 and 2.2 of the SPS Agreement.
2745  Consequently, it would be inappropriate 
for the Panel to assess these four additional alterna tives, even if New Zealand had validly identified 
them.  The Panel cannot review th e consistency of the fire blight  and European canker measures at 
issue with Article 5.6 in light of alternatives that  the complainant regards as based on an assumption 
that could result in a violation of Articles 5.1, 5.2 and 2.2 of the SPS Agreement.  Through its analysis 
of New Zealand's Article 5.6 claim, the Panel cannot promote alternative measures based on such an assumption. 
7.1117  In fact, Article 3.7 of the DSU stipulates that "[t]he aim of the dispute settlement mechanism 
is to secure a positive solution to a dispute."  Furt her, Article 3.5 of the DSU prescribes that all 
solutions shall be consistent with the covered agreements: 
"All solutions to matters formally raised under the consultation and dispute settlement 
provisions of the covered agreements, in cluding arbitration awards, shall be 
consistent with those agreements and shall not nullify or impair benefits accruing to 
any Member under those agreements, nor impe de the attainment of any objective of 
those agreements." 
7.1118  In any event, the Panel could not carry out the substantive analysis of these four alternatives 
under Article 5.6, even if it was appropriate  for it to do so.  As Australia points out
2746, New Zealand 
does not develop arguments for these four additi onal alternatives in regard to all cumulative 
conditions of the Article 5.6 test.  In the context of  its Article 5.6 claim relating to fire blight and 
European canker, New Zealand advances argument s and evidence for all three conditions of the 
Article 5.6 test only in regard to the alternative measure restricting imports to mature, symptomless 
apples.  For three of the four additional altern atives, New Zealand does not advance any specific 
arguments or evidence in the context of fire bli ght or European canker in regard to the three 
                                                      
2743 New Zealand's reply to Panel question 124 after the second substantive meeting (emphasis added). 
2744 New Zealand's second written submi ssion, para. 2.894 (emphasis added). 
2745 See paras. 7.445 and 7.741 above. 
2746 Australia's comments on New Zealand's replies to Panel questions after the second substantive 
meeting, para. 209.  WT/DS367/R 
 Page 457 
 
 
 conditions of the Article 5.6 test.  For the retail-re ady measure, in the context of fire blight and 
European canker, New Zealand advances arguments only in regard to the first condition of the 
Article 5.6 test, but not for the other two conditions.2747  Further, New Zealand explicitly notes that the 
four additional alternatives "simply [serve  to] indicate[] the severity of the breach"2748 of Article 5.6. 
7.1119  In Chile – Price Band System  the Appellate Body held that panels act ultra petita  and 
inconsistently with Article 11 of the DSU if they assess claims that the complainant has not 
articulated or for which it has not submitted arguments.2749  The Panel considers that this applies also 
to the current dispute, even if the question before th e Panel arises in regard to alleged alternatives to 
the measures within the Panel's terms of reference under Article 5.6 of the SPS Agreement.  In the 
absence of arguments and evidence by New Zealand on how the four additional alternatives fulfil all 
three cumulative conditions of the Article 5.6 test , it would be inappropriate for the Panel to assess 
whether, in comparison with these four alternatives,  the fire blight and European canker measures at 
issue violate Article 5.6.  If necessary, the Panel can take these alternatives into account only as 
argued by New Zealand:  an alleged indication of the severity of the breach of Article 5.6 under the 
comparison of the fire blight and European canker measures at issue with the alternative measure of 
restricting imports to mature, symptomless apples. 
7.1120  The Panel will proceed accordingly, and assess whether this single alternative measure 
properly identified and adequately argued by New Zeal and for fire blight and European canker fulfils 
the three cumulative conditions of the Article 5.6 test. 
(b) Whether restricting imports to mature, symptomless apples satisfies the three-pronged 
Article 5.6 test 
(i) Second condition:  whether restricting impor ts to mature, symptomless apples achieves 
Australia's ALOP in regard to fire blight and European canker 
Summary of the Parties' arguments  
7.1121  New Zealand alleges that restricting imports to  mature and symptomless apples will achieve 
Australia's ALOP, which the IRA determines as "provi ding a high level of sanitary or phytosanitary 
protection aimed at reducing risk to a very low level, but not to zero".2750  According to New Zealand, 
there is no scientific evidence that mature, sy mptomless apples can provide a pathway for the 
transmission of fire blight and European canker.  Thus, the risk of transmission is even lower than 
Australia's ALOP;  it is negligible.  Therefore, New Zealand's alternative will achieve Australia's 
ALOP.2751 
7.1122  New Zealand also argues that Australia's clim atic conditions in the apple-producing areas 
preclude the establishment or spread of European canker.2752  New Zealand stresses its experience as 
one of the world's "top ten apple exporters", an d that it has never been associated with the 
transmission of any pests, including fire blight and European canker.2753 
                                                      
2747 New Zealand's reply to Panel question 114  after the second substantive meeting. 
2748 New Zealand's second written submission, paras. 2.894-2.895 (original emphasis).  See also 
New Zealand's second written submission, para. 2.895;  and New Zealand's reply to Panel question 127 after the 
second substantive meeting. 
2749 Appellate Body Report on Chile – Price Band System , para. 173.  See also Appellate Body Report 
on US – Certain EC Products , para. 114. 
2750 New Zealand's first writte n submission, para. 4.498. 
2751 New Zealand's first written s ubmission, paras. 4.499-4.500. 
2752 New Zealand's first writte n submission, para. 4.501. 
2753 New Zealand's first writte n submission, para. 4.502. WT/DS367/R 
Page 458  
 
 7.1123  New Zealand refers to Japan – Apples (Article 21.5 – US) , where the compliance panel found 
that requiring apples to be mature and symptoml ess achieves the defendant's ALOP which aimed at 
"preventing the introduction of E. amylovora  with the security equivale nt of import prohibition".  
In New Zealand's view, this ALOP, while different, is the functional equivalent of Australia's ALOP, 
if not a stricter level of protection.
2754 
7.1124  New Zealand argues that Aust ralia's defence under Article 5.6 is contingent on the 
consistency of the IRA with Article 5.1.  The IRA does not find support in the scientific evidence and 
is inconsistent with Article 5.1.  New Zealand also  contends that there is no scientific evidence that 
mature symptomless apples provide a pathway for fire blight and European canker.2755  Australia's 
argument that New Zealand's alternative has alre ady been factored in the IRA misses the point 
because New Zealand is challenging the validity of that assessment and argues that it is not supported 
by scientific evidence.2756 
7.1125  According to New Zealand, Australia relies on the experts' responses to questions not linked 
to whether restricting imports to mature, sympto mless apples would achieve Australia's ALOP.  
Australia attempts to take the experts' responses out of context to support its view that the alternative 
would not achieve its ALOP.  Australia relies on experts' responses, which in some instances are 
premised on an assumption that the risk assessment in the IRA is correct, or directed to only certain 
aspects of the pathway (for example probability of entry).  New Zealand claims that the experts' responses taken "as a whole", meaning the experts' responses on exposure
2757, establishment and 
spread2758 and consequences2759, demonstrate that requiring apples to be mature and symptomless 
would achieve Australia's ALOP.2760 
7.1126  New Zealand refers to the responses of Dr Pau lin and Dr Deckers to support its arguments 
that there is a lack of scientif ic evidence underpinning the IRA's conclusions under several of the 
main importation steps for fire blight as well as the IRA's conclusion on the percentage of New Zealand apples that would be contaminated with fire blight.
2761  Dr Paulin indicated that the risk 
of fire blight being introduced by New Zealand a pples was "probably of the same order of magnitude 
as the transport of contaminated insects by natural way from New Zealand to Australia by air jet or 
things like that".2762  In light of Dr Paulin's response, New Zealand states that measures on apple fruit 
would provide no additional protection for Australia against fire blight than having no measures, and 
that fire blight is equally (un)likely to be transmitted by existing natural means as by mature 
apples.2763  
7.1127  In relation to European canker, New Zealand argu es that the experts have confirmed that there 
is no risk of entry, establishment and spread of the disease from trade in fruit, other than the kind of 
theoretical possibility that can never be ruled out.2764  New Zealand claims that Dr Swinburne 
suggested that New Zealand's alternative measure may be more than adequate to meet the negligible 
risk of entry, establishment and spread through trade in apple fruit.2765 
                                                      
2754 New Zealand's first writte n submission, para. 4.503. 
2755 New Zealand's second writte n submission, para. 2.891. 
2756 New Zealand's second writte n submission, para. 2.892. 
2757 New Zealand's second writte n submission, para. 2.635. 
2758 New Zealand's second writte n submission, para. 2.659. 
2759 New Zealand's second writte n submission, para. 2.685. 
2760 New Zealand's second writte n submission, para. 2.893. 
2761 New Zealand's reply to Panel question 126 afte r the second substantive meeting, para. 203. 
2762 Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 380. 
2763 New Zealand's reply to Panel question 126 afte r the second substantive meeting, para. 204. 
2764 New Zealand's reply to Panel question 126 afte r the second substantive meeting, para. 207. 
2765 New Zealand's reply to Panel question 126 afte r the second substantive meeting, para. 208.  WT/DS367/R 
 Page 459 
 
 
 7.1128  Australia disagrees with New Zealand that rest ricting imports to mature, symptomless apples 
would achieve Australia's ALOP.2766  New Zealand's alternative has already been factored into the 
assessment of the IRA as implying a "low" risk, which is in excess of the "very low level" of 
Australia's ALOP as est ablished by the IRA.2767  Even if the IRA Team has limited its analysis for fire 
blight and European canker to "mature apple fru it free of trash", it assessed "the potential for 
symptomless apples to carry the diseases".2768  The external (epiphytic) infestation by E. amylovora  
bacteria, which would be symptomless, was the IRA Team's primary concern for fire blight.  With 
respect to European canker, latent infection by N. galligena  which would also be symptomless was 
the risk scenario of greatest concern for the IR A Team.  Bacteria and latent European canker 
infections are not visible to the naked eye.2769  Thus, Australia claims that restricting imports to 
mature symptomless apples would in no way reduce the risks of concern to Australia associated with 
fire blight and European canker.  Accordingly,  this restriction would not achieve Australia's 
ALOP.2770 
7.1129  According to Australia, New Zealand's arguments against the measures at issue are predicated 
on Australia's calculations of the un restricted risk for fire blight2771 and European canker2772 not being 
valid.  But the IRA Team considered that apples wh ich are externally (epiphy tically) infested with 
E. amylovora  bacteria (fire blight) and apples which ar e latently infected (or infested) with 
N. galligena  (European canker), would not show symptoms, and therefore restricting imports to those 
"symptomless" apples would have no impact whatsoever on the relevant risk scenario of concern for the IRA Team.  Also, New Zealand has not demonstrated any serious flaws with the IRA's analysis of the unrestricted risk.
2773 
7.1130  Australia submits that the IRA is a valid risk assessment.  Accordingly, Australia is entitled to 
rely upon the IRA's findings on the unrestricted risk associated with fire blight and European canker, 
and to implement the measures that should be take n to reduce those risks to achieve Australia's 
ALOP.2774  Australia argues that restricting imports to mature symptomless apples would not achieve 
its ALOP without further risk management measures.2775  If the Panel finds no violation under 
Article 5.1, Australia's measures are con sequentially consistent with Article 5.6.2776 
7.1131  As regards the experts' responses, Australia point s out that Dr Deckers and Dr Paulin explain 
that the alternative measure identified by New Zeal and would not achieve Australia's ALOP for fire 
blight.2777  Responding to New Zealand's reliance on Dr Pa ulin's statement to as sert that no measures 
are warranted for fire blight, Australia notes that  the experts' responses confirm the IRA Team's 
                                                      
2766 Australia's first written submission, para. 1088.  See also, Australia's second written submission, 
para. 452. 
2767 Australia's first written submission, para. 1084.  See also, Australia's reply to Panel question 138 
after the first substantive meeting. 
2768 Australia's reply to Panel question 138 after the first substantive meeting.  See also, Australia's first 
written submission, para. 1084. 
2769 Australia's first written submission, para. 1084.  See also, Australia's reply to Panel question 138 
after the first substantive meeting. 
2770 Australia's reply to Panel question 138 after the first substantive meeting. 
2771 Australia's second written submission, para. 448. 
2772 Australia's second written submission, para. 609. 
2773 Australia's second written submission, para. 452.  See also, Australia's second written submission, 
para. 611-612. 
2774 Australia's first written submission, para. 1085. 
2775 Australia's first written submission, para. 1086. 
2776 Australia's second written submission, paras. 613. 
2777 Australia's second written submission, para. 315  and 451.  See also Australia's comments on the 
experts' replies to questions, Australia's communication to the Panel, 25 March 2009, para. 38. WT/DS367/R 
Page 460  
 
 conclusions.
2778  In particular, Australia claims that Dr Pa ulin agreed with Australia's principal risk 
reduction measures.2779  Consequently, the conclusion that the risk of fire blight introduction through 
mature symptomless apples exceed s Australia's ALOP falls within the spectrum of legitimate 
science.2780 
7.1132  In relation to European canker, Australia argu es that New Zealand has not demonstrated any 
serious flaws regarding the IRA's conclusion on the unr estricted risk or established that its alternative 
would achieve Australia's ALOP.2781  Australia notes that even if Dr Latorre did not specifically 
address whether the alternative would achieve Au stralia's ALOP, his response confirmed that 
restricting imports to mature symptomless apples w ould not take into account that latent infection 
may occur on mature apple fruit.2782  In addition, Australia relies on Dr Swinburne's response that the 
latent infection of apples with European canke r may not be visible at the time of inspection.2783  
Accordingly, Australia submits, th e experts' views support Australia's  conclusion that New Zealand's 
alternative would not achieve Aust ralia's ALOP for European canker.2784 
The Panel's analysis  
The Panel's approach to the second condition of the Article 5.6 test 
7.1133  Although New Zealand identifies one altern ative measure for both fire blight and 
European canker, the Panel will assess the second conditio n of the Article 5.6 test separately for these 
two pests.  The matters the Panel intends to address in this context are specifically linked to the two 
pests, and whether restricting the imports of New Zealand apples to mature, symptomless apples would achieve Australia's ALOP needs to be  analysed in the specific pest context. 
7.1134  As regards the Panel's approach to analysing the second condition of the Article 5.6 test, 
the Panel agrees with Australia
2785 that it cannot conduct a de novo review.  But the Panel cannot read 
Article 5.6 out of the SPS Agreement either.  Even if  Australia has the right to establish its ALOP and 
to devise risk management measures if necessary to  achieve such ALOP, Australia has to do so 
consistently with the SPS Agreement.  The panel in Australia – Salmon has addressed this question: 
"We fully agree with Australia that the determination of its level  of sanitary 
protection is a decision to be made by Australia, not by any other WTO Member or 
international organization.  ...  However, this  decision on what level of protection is 
appropriate has to comply with the SPS Agreement ... .  The same applies to Australia's decision as to which sanitary measure  will achieve Australia's level of  
protection.  It is for Australia to decide on this, but, again, in so doing it has to act consistently with the SPS Agreement, in pa rticular Articles 2, 5.1 to 5.3 and 5.6.  
Our examination under Article 5.6 is not aimed at a de novo  review of what sanitary 
                                                     
 
2778 Australia's comments on New Zealand's replies to Panel questions after the second substantive 
meeting, para. 132. 
2779 Australia's comments on New Zealand's replies to Panel questions after the second substantive 
meeting, para. 133. 
2780 Australia's comments on New Zealand's replies to Panel questions after the second substantive 
meeting, para. 134. 
2781 Australia's second written submission, para. 612. 
2782 Australia's comments on the experts' replies to questions;  Australia's communication to the Panel, 
25 March 2009, para. 209. 
2783 Australia's comments on the experts' replies to questions;  Australia's communication to the Panel, 
25 March 2009, para. 210. 
2784 Australia's comments on the experts' replies to questions;  Australia's communication to the Panel, 
25 March 2009, para. 211. 
2785 Australia's first written submission, para. 1098.  WT/DS367/R 
 Page 461 
 
 
 measure Australia should have chosen to achie ve its appropriate le vel of protection.  
On the other hand, we cannot completely defe r this decision to Australia and thus not 
give effect to Article 5.6.  Our mandate  under Article 11 of the DSU requires us to 
'make an objective assessment of the matter before [us], including an objective assessment of the facts of the case'."
2786 
7.1135  On appeal, the Appellate Body confirmed this a pproach, and held in the context of Article 5.6 
that "[i]t would obviously be wrong to interpret the SPS Agreement  in a way that would render 
nugatory entire articles or paragraphs of articles of  this Agreement and allow Members to escape their 
obligations under this agreement."2787 
7.1136  Australia has a qualitative ALOP, defined as "pr oviding a high level of protection aimed at 
reducing risk to a very low level, but not to zero."2788  In Australia – Salmon (Article 21.5 – Canada) , 
the compliance panel held that such an ALOP might complicate, but should in no way prevent, 
a panel's analysis of Article 5.6 claims, in partic ular as regards the second condition of the Article 5.6 
test: 
"[A]lthough, according to the Appellate Body, Australia determined its ALOP with 
sufficient precision to apply Article 5.6, we  find it rather difficult to evaluate whether 
any of the options before us would also meet Australia's somewhat vaguely determined level of 'a high or very conser vative level of protection aimed at reducing 
risk to very low levels, while not based on a zero-risk approach'.  We are of the view, 
however, that this should not prevent us from carrying out the task.  As noted by the Appellate Body, '[o]therwise, a Member's  failure to comply with the implicit 
obligation to determine its a ppropriate level of protection – with sufficient precision – 
would allow it to escape its obligations under this Agreement and, in particular, its 
obligations under Articles 5.5 and 5.6'.  We note, parenthetically, that a more explicit 
and in particular a quantitative expression of a Member's ALOP would greatly facilitate the consideration of compliance with not only Article 5.6 but with other 
provisions of the SPS Agreement as well."
2789 
7.1137  In light of the above, the Panel will not refrain  from a substantive analysis of New Zealand's 
Article 5.6 claim in this dispute.  As regards the second condition of the Article 5.6 test, the Panel will 
follow the Appellate Body's guidance in Australia – Salmon , and assess "whether [the] ... alternative 
SPS measures [advanced by New Zealand] meet the appropriate level of protection as determined by 
[Australia] ."2790  Bearing in mind the standard rules on burden of proof, applicable also in SPS 
disputes, the Panel will assess whether New Zealand has "establish[ed] a prima facie  case of 
inconsistency [with Article 5.6]"2791, in particular as regards the second condition of the Article 5.6 
test.  In other words, the standard rules on burden of proof, as articulated by the Appellate Body in US 
– Wool Shirts and Blouses , apply here.2792  Accordingly, the Panel will assess whether New Zealand 
                                                      
2786 Panel Report on Australia – Salmon , para. 8.172 (original emphasis).  See also Appellate Body 
Report on Australia – Salmon , para. 199. 
2787 Appellate Body Report on Australia – Salmon , para. 206. 
2788 Australia's IRA, Part A, p. 3. 
2789 Panel Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.129 (footnotes omitted). 
2790 Appellate Body Report on Australia – Salmon , para. 204 (original emphasis). 
2791 Appellate Body Report on EC – Hormones , para. 98.  See also Appellate Body Report on Japan – 
Agricultural Products II , para. 122. 
2792 In US – Wool Shirts and Blouses  the Appellate Body held that " it is a generally-accepted canon of 
evidence in civil law, common law and, in fact, most jurisdictions, that the burden of proof rests upon the party, whether complaining or defending, who asserts the affirmative of a particular claim or defence.  If that party 
adduces evidence sufficient to raise a pr esumption that what is claimed is true, the burden then shifts to the other WT/DS367/R 
Page 462  
 
 has adduced sufficient evidence to raise a presump tion that the proposed alternative measure would 
achieve Australia's ALOP.  If New Zealand succeeds in  raising this presumption,  then the burden of 
proof  shifts to Australia, who must adduce suffici ent evidence to rebut the presumption.  If Australia 
fails to rebut this presumption, then, as a matter of law, New Zealand will have satisfied the second 
prong of the Article 5.6 test. 
7.1138  Annex A(5) of the SPS Agreement defines ALOP as follows: 
"Appropriate level of sanitary or phytosanitary protection  – The 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. 
NOTE:  Many Members otherwise refer to this concept as the ' acceptable level of 
risk'."  (Emphasis added) 
7.1139  Further, Article 5.6 of the SPS Agreement refere nces "sanitary or phytosanitary measures to 
achieve the appropriate level of sanitary or phytosa nitary protection."  Likewise, Article 5.3 of the 
SPS Agreement makes reference to "assessing the risk to animal or plant life or health and 
determining the measure to be applied for ach ieving the appropriate level of sanitary and 
phytosanitary protection from such risk."  This  is underscored by the Guidelines to Further the 
Practical Implementation of Article 5.5, which re peatedly refer to SPS measures designed and applied 
to achieve the ALOP.
2793 
7.1140  These passages from the SPS Agreement and the Guidelines to Further the Practical 
Implementation of Article 5.5 make it clear that the measures necessary to meet a Member's ALOP must flow from, and reflect, the Member's risk asse ssment.  In fact, Article 5.1 of the SPS Agreement 
explicitly lays down this requirement. 
7.1141  In other words, risk management measures are warranted only if the risk exceeds the ALOP.  
The Panel notes in this regard that ISPM No. 5 de fines "Pest risk analysis" as "[t]he process of 
evaluating biological or other scientific and economic evidence to determine whether an organism is a 
pest, whether it should be regulated, and the stre ngth of any phytosanitary measures to be taken 
against it [FAO, 1995; revised IPPC, 1997; ISPM No. 2, 2007]".
2794  In turn, ISPM No. 11 explains 
that risk management measures should be a dopted only if the risk exceeds the ALOP: 
"Overall risk is determined by the examin ation of the outputs of the assessments of 
the probability of introduction and the econom ic impact.  If the risk is found to be 
unacceptable, then the first step in ri sk management is to identify possible 
phytosanitary measures that will reduce the risk to, or below an acceptable level. 
Measures are not justified if the risk is already acceptable  or must be accepted 
because it is not manageable (as may be  the case with natural spread).  ... 
Appropriate measures should be chosen b ased on their effectiveness in reducing the 
probability of introduction of the pest."2795 
                                                                                                                                                                     
party, who will fail unless it adduces sufficient evidence to rebut the presumption."  Appellate Body Report on 
US – Wool Shirts and Blouses , p. 14. 
2793 SPS Committee's Guidelines to further the practical implementation of Article 5.5  (G/SPS/15), 
18 July 2000, Part B. 
2794 Glossary of phytosanitary terms , 2008 (ISPM No. 5, FAO, Rome), in Exhibit AUS-164, p. 13. 
2795 Pest risk analysis for quarantine pests, including analysis of environmental risks and living 
modified organisms , 2004 (ISPM No. 11, FAO, Rome), in Exhibit AUS-6, pp 130-131 (emphasis added).  WT/DS367/R 
 Page 463 
 
 
 7.1142  Further, the higher the margin by which the risk exceeds the ALOP, the stricter the risk 
management measures that might be necessary to reduce the risk to the ALOP.  By the same token, if 
the assessment of risk is exaggerated, there may be reason to believe that the measures that are 
designed to protect against that risk ma y also be exaggerated – or too strict. 
7.1143  Accordingly, the Panel will assess first whet her 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 exceed Australia's ALOP to the extent 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. 
7.1144  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, Austra lia's ALOP.  Obviously, the Panel cannot conduct a de 
novo  risk assessment.  The Panel's task is to assess wh ether New Zealand has raised a presumption, 
not successfully rebutted by Australia, that the alte rnative measures have a sufficient risk reduction 
effect.  The Panel will analyse whether New Zealan d has advanced sufficient indices for such a risk 
reduction effect, and consider what the experts say a bout such an effect.  The Panel will also assess 
whether the IRA evaluated the alternatives identified by New Zealand, and – if they were evaluated – 
whether their eventual rejecti on by the IRA was justified. 
Analysis of the second condition of the Article 5.6 test for fire blight 
7.1145  The Panel will assess first whether New Zealand h as demonstrated that Australia's calculation 
of the fire blight risk resulting from the importati on of New Zealand apples is  exaggerated.  Under 
Article 5.1 of the SPS Agreement, the Panel has alre ady found this to be the case.  In particular: 
(a) In regard to importation step 1
, the Panel has found that the IRA's estimation that 
E. amylovora  will always be present in the source orchards in New Zealand is not 
sufficiently supported by the scientific evidence that the IRA relied upon and, 
accordingly, is not coherent and objective.2796  In particular, the Panel has found that, 
while the IRA's basis with respect to this  importation step comes from respected and 
qualified scientific sources, the IRA's reasoni ng in this regard is not coherent and 
objective and the resulting likelihood assigne d to this step is exaggerated.2797  T h e  
Panel has added that importation step 1 is a very important starting point for 
Australia's IRA.  The following step, importa tion step 2, assesses the likelihood that 
picked fruit is contaminated with Erwinia amylovora .  The likelihood in step 2 is 
directly related to the history of fire blight in the year of cropping (whether active 
symptoms producing inoculum were present) and in the previous years (for the possibility of internal presence of Erwinia amylovora  in the xylem).
2798 
(b) For importation step 2 , the Panel has found that the IRA's estimation of the likelihood 
that fruit coming from an infected or infested  orchard is infected or infested with 
                                                      
2796 See para. 7.259 above. 
2797 See para. 7.258 above. 
2798 See para. 7.257 above. WT/DS367/R 
Page 464  
 
 E. amylovora  is not coherent and objective.
2799  The Panel has noted that according to 
Dr Paulin the probability range for this step is high.2800  The Panel has held that it is 
not clear from the IRA how the results from different studies were aggregated in order to arrive at an estimation for th e probability range assigned to importation 
step 2 and why, in this context, less weight was given to studies that found lower 
frequencies of contamination with fire blight.
2801  Dr Paulin also pointed out that no 
general and reasonable conclusion for the presence of Erwinia amylovora  on or in 
mature apple fruit can be based on the di sparate results in the relevant studies.2802 
(c) For importation step 3 , the Panel has found that the IRA's estimation of the likelihood 
that clean fruit from infected or infest ed orchards is contaminated with E. amylovora  
during picking and transport to the packi ng house does not rely on adequate scientific 
evidence and is accordingly not  coherent and objective.2803  The Panel has also noted 
that according to Dr Deckers, 1 per cent as the most likely value of the triangular 
distribution for this importation step seems too high.2804 
(d) For importation step 4 , the Panel has concluded that New Zealand has not made a 
case that the IRA's estimation of the likelihood that E. amylovora  survives routine 
processing procedures in the packing house is exaggerated and does not rely on adequate scientific evidence.  At the same time, the Panel has noted that according to 
some of the experts the probability range and pattern distribution estimated by the IRA for this importation step seems too hi gh, particularly considering the possible 
effect of the use of disinfectants.
2805 
(e) For importation step 5 , the Panel has found that the IRA's estimation of the likelihood 
that clean fruit is contaminated by E. amylovora  during processing in the packing 
house is not coherent and objective.  The Pa nel has noted that the experts considered 
the IRA's estimation regarding importati on step 5 to be strongly exaggerated.2806 
(f) For importation step 6 , the Panel has found that New Zealand has not made a case 
that the IRA's estimation of the likelihood that Erwinia amylovora  survives 
palletization, quality inspection, containeri zation and transportation to Australia is 
inflated or that it is not based on a coherent  and objective reasoning.  Nonetheless, the 
Panel has noted Dr Deckers's statement that "[t]he survival of the [ E. amylovora ] 
bacteria during palletization, containerization and transport is considered to be low, 
surely after the external disinfection of  the fruits during the packaging process."2807 
(g) For importation step 7 , the Panel has found that the IRA's conclusion that the 
likelihood that clean fruit is contaminated by Erwinia amylovora  during palletization, 
quality inspection, containerization and tran sportation is negligible appears to be 
coherent and objective.2808  The separate question of the IRA's choice of a probability 
interval of zero to one in one million fo r such type of "negligible" events was 
                                                      
2799 See para. 7.275 above. 
2800 See para. 7.273 above. 
2801 See para. 7.274 above. 
2802 Ibid. 
2803 See para. 7.290 above. 
2804 See para. 7.288 above. 
2805 See paras. 7.305-7.306 above. 
2806 See paras. 7.318-7.320 above. 
2807 See paras. 7.330-7.331 above. 
2808 See para. 7.342 above.  WT/DS367/R 
 Page 465 
 
 
 subsequently addressed by the Panel in th e context of New Zealand's allegations 
regarding the IRA's methodological flaws.2809 
(h) For importation step 8 , the Panel has noted that New Zealand did not call into 
question the IRA's estimation of the like lihood of the event represented by this 
particular importation step.  The Panel h as concluded that there is no reason to 
believe that such estimation is not cohere nt and objective in light of the scenario 
addressed by the IRA.2810 
7.1146  In light of the above, the Panel has also found that the IRA's estimation of the overall 
probability of importation  does not rely on adequate scientific evidence and, accordingly, is not 
coherent and objective.2811  The Panel has held in this context that if the estimations of one or more of 
the individual likelihoods are questionable, because  those estimations are either not supported by 
adequate scientific evidence or not based on an coherent and obj ective reasoning, the overall figure 
necessarily becomes questionable.2812  Moreover, the IRA does not attempt to find justification for the 
estimated overall probability of importation, other than the aggregation of the different individual 
likelihoods represented by each importation step.  The Panel has also noted that according to 
Dr Deckers this overall probability is a relativ ely high value and is probably overestimated.2813 
7.1147  As to the probability of entry  of fire blight into Australia through apples imported from 
New Zealand, in particular as regards exposure, th e Panel has found that the scientific evidence cited 
in the IRA supports the conclusions on the viability  and the survival of fire blight bacteria on 
imported apples.  The Panel has stated, however, that both conclusions rest on the assumption that there will be some bacterial populations on matu re apples from New Zealand.  Additionally, both 
conclusions must be qualified by the caveat that  any bacterial populations would decrease and would 
be unlikely to be able to multiply.  The Panel has found that the IRA's conclusions on the transfer 
mechanisms are not supported by scientific evidence,  especially in regard to the proposition of a 
mechanical transmission mechanism.  The browsi ng insects scenario, while not totally unreasonable 
seems to correspond to a highly unlikely scenario.  The IRA's conclusions on inoculum dose and host 
receptivity are generally coherent and supported by evidence, although the former fails to recognize 
the importance of the number of bacteria for the likelihood of initiating an infection, and the latter 
tends to exaggerate the number of potential hos t plants and does not take into account the 
discontinuity in the receptivity of host plants.  Finally, the IRA's conclusions on environmental 
conditions seem generally c oherent.  In light of the assumptions and qualifications that affect most of 
the sections of the IRA's conclusions on exposure,  the Panel has found that overall these conclusions 
do not rely on adequate scientific evidence and,  accordingly, are not coherent and objective.
2814 
7.1148  As regards the probability of fire blight establishment , the Panel has noted that the IRA's 
discussion on the minimum population needed for establishment reflects an assumption that has already been addressed by the Panel, regarding the alleged capacity of such low bacterial populations 
to initiate an infection.  This assumption is an important factor in any conclusion regarding the 
probability of establishment of fire blight.  It had been found by the Panel not to be supported by 
scientific evidence nor based on a coherent and objective reasoning.
2815 
                                                      
2809 See paras. 7.484 and 7.508 above. 
2810 See para. 7.349 above. 
2811 See para. 7.356 above. 
2812 See para. 7.355 above. 
2813 See para. 7.356 above. 
2814 See para. 7.417 above. 
2815 See para. 7.420 above. WT/DS367/R 
Page 466  
 
 7.1149  As regards fire blight spread
, the Panel has found that the IR A's conclusions regarding the 
probability of spread seem generally coherent.  At the same time, the Panel has pointed out that the 
value assigned to such probability should be comm ensurate to the extremely low likelihood of 
transmission through the browsing insects scenario.2816 
7.1150  In light of the above, in re gard to exposure, establishm ent and spread in general , the Panel has 
concluded that with respect to several aspects of  its discussion on exposure, establishment and spread, 
the IRA's reasoning seems on its face generally cohere nt.  The Panel has added, however, that all of 
these sections rest on the assumption that at leas t some imported apples will be infested with 
Erwinia amylovora .2817  Furthermore, the Panel has stated that throughout the discussion of the 
different factors, the IRA tends to exaggerate the risk, by not emphasizing that any bacterial 
populations would likely be small, diminishing and not able to multiply and that no infection can 
occur unless host plants are in a susceptible stage.  The IRA instead emphasizes certain factors that 
would tend to increase the likelihood of entry, estab lishment and spread, in the absence of adequate 
scientific evidence or even disregarding  available evidence to the contrary.2818  The Panel has also 
found that the reasoning articulated in Australia's  IRA, with respect to the likelihood of entry, 
establishment and spread of fire blight, including the IRA's estimation of the value for the respective 
probabilities, does not rely on adequate scientific evidence and, accordingly, is not coherent and 
objective.2819 
7.1151  Further, the Panel has found that, with respect to the methodological flaws identified by 
New Zealand, the IRA overestimates the overall probab ility of the entry, establishment and spread of 
fire blight  in this dispute.  The Panel has found that th e 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" like lihood of occurring (corresponding to the qualitative 
descriptor "the event would almost certainly not occu r") is not properly justif ied in the IRA and leads 
to an overestimation of the probability of entry, estab lishment and spread of fire blight.  Likewise, the 
Panel has concluded that the combination of this probability interval for events with a "negligible" 
likelihood of occurring, with the IRA's use of a uni form distribution to model the likelihood of these 
events, would tend to result in an additional over estimation of the likelihood of such "negligible" 
events.  The Panel has agreed with New Zealand th at these two flaws "magnify the assessment of risk, 
turning what are often the remote st of possibilities into events th at are assessed as occurring with 
some frequency."2820 
7.1152  Finally, with respect to consequences , the Panel has found that the IRA's evaluation of the 
potential consequences associated with the entry, establis hment or spread of fire blight into Australia 
does not rely on adequate scientific evidence and,  accordingly, is not coherent and objective.2821 
7.1153  In the light of these findings under Articles 5.1 and 5.2 of the SPS Agreement, the Panel 
concludes that for the purposes of its Article 5.6 cl aim New Zealand has made the case that Australia's 
IRA overestimates the fire blight risk resulti ng from imports of New Zealand apples.  Thus, 
New Zealand has cast doubt on whether the fire bli ght risk would exceed Australia's ALOP to the 
extent calculated by the IRA, and warrant as strict  risk management measures as those developed by 
the IRA.  Further, New Zealand has cast doubt on whether the unrestricted fire blight risk would 
necessarily exceed Australia's ALOP.  Accordingly, th ere is no reason to believe that the alternative 
measure suggested by New Zealand would not meet Australia's ALOP. 
                                                      
2816 See para. 7.423 above. 
2817 See para. 7.428 above. 
2818 See para. 7.429 above. 
2819 See para. 7.448 above. 
2820 See para. 7.508 above.  See also, New Zeal and's second written submission, para. 2.297. 
2821 See para. 7.470 above.  WT/DS367/R 
 Page 467 
 
 
 7.1154  As outlined above2822, the Panel now turns to assessing more directly whether, assuming that 
risk management measures are necessary, New Zealand has raised a presumption, not successfully rebutted by Australia, that its alternative measure suffi ciently reduces the fire bli ght risk to, or below, 
Australia's ALOP. 
7.1155  The Panel notes that Australia's IRA did not fo rmally consider restricting New Zealand apple 
imports to mature, symptomless apples as a potentia l risk management measure.  The IRA rejected 
certain "other potential risk management measures fo r fire blight" without mentioning the possibility 
of restricting imports to mature symptomless apples: 
"Other potential risk management measures The IRA team considered other possibl e risk management measures including 
irradiation, fumigation and treatments with  different bactericidal agents, vacuum 
infiltration of disinfectants and the use of  pest free places of production.  There was 
insufficient data relevant to fire blight  for the IRA team to adequately assess the 
efficacy of these alternatives.  However, the proposed measures are always open to 
review if additional relevant information is forthcoming that suggests alternative 
measures may be capable of reducing the risks to Australia's ALOP."
2823 
7.1156  At the same time, Australia argues that the unde rlying basis of the IRA Team's analysis for 
fire blight and European canker was predominan tly concerned with mature, symptomless apples.2824  
In the context of importation step 2 (the likelihood that fruit coming from an infected or infested orchard is infected or infested with E. amylovora ), the IRA did look at whether mature, symptomless 
apples from New Zealand can carry fire blight: 
"In considering the appropriate value that should be assigned to [Importation Step 2], 
the IRA team assessed the relevance of the information reviewed above.  It should be 
noted that, at this stage, only the unrestrict ed risk is being assessed.  As such, this 
evaluation ... needs to take into account th e fact that apples could be sourced from 
anywhere in New Zealand irrespective of the fire blight status of orchards.  For 
example, mature, symptomless apples  could be sourced from, among other things, 
orchards: 
with active fire blight, including many fire blight strikes on each tree; or that show few or no symptoms, but are very  close to active fire blight in hedgerow 
plants (such as cotoneaster); or 
that show no symptoms and are some distance from an active fire blight host. 
Given the widespread distribution of fire  blight in New Zealand, the IRA team 
concluded that more weight should be gi ven to those studies on apples sourced from 
orchards that were showing symptoms of fire blight disease. 
The IRA team acknowledged that there are several studies that found no evidence of 
the presence of fire blight bacteria on mature symptomless apples  and that some of 
these studies were carried out on orchards showing symptoms of fire blight. 
                                                     
 
2822 See para. 7.1144 above. 
2823 Australia's IRA, Part B, p. 113.  See also , Australia's IRA, Part B, pp. 105 and 112. 
2824 Australia's second written submission, paras. 450  and 611;  Australia's first written submission, 
para. 1084;  Australia's replies to Panel question 138 after the first substantive meeting. WT/DS367/R 
Page 468  
 
 However, given that there are a number of studies that confirm the presence of fire 
blight bacteria on such fruit, studies that f ound no evidence of fire blight bacteria on 
mature symptomless apples  were given much less weight. 
Turning to the studies that det ected fire blight bacteria on mature, symptomless 
apples , there is a considerable amount of variation on the infestation rates reported.  
For example, Roberts et al. (1998) review ed the literature and concluded that the 
average infestation rate for apples sourced from orchards with symptoms was around 4.9%, and from orchards with no cons ideration of orchard symptoms was 
approximately 0.35%.  One stakeholder has cl aimed that Roberts et al. (1998) used an 
inappropriate method to combine results from different studies to calculate infestation 
rates.  The stakeholder concluded that the infestation rates should be higher.  The IRA 
team has reviewed this paper and agrees th at there may be better ways of combining 
the data.  However, the IRA team’s conclu sions on [importation step 2] are based on 
a consideration of all relevant information – not just the Roberts et al. (1998) paper – 
and the IRA team considers that the values suggested in the draft are appropriate."
2825 
(emphasis added) 
7.1157  In its analysis of New Zealand's Article 5.1 cl aim, the Panel has found that this Part of the 
IRA does not find sufficient support in the scientific  evidence relied upon and, accordingly, is not 
coherent and objective.  The Panel has stated that  there is no adequate justification for the IRA's 
statement that more weight should be given to studies on apples sourced from orchards that were 
showing symptoms of fire blight disease.2826  As noted by Dr Paulin, this statement does not seem to 
take adequately into account that there is no indicatio n that fire blight will be  present at all times, even 
in an infected orchard.  While it is reasonable to assume that no orchard in New Zealand is or has been permanently free of fire blight, that does not mean that all orchards will permanently show active 
symptoms.
2827  According to the evidence cited in the IRA, one year with Erwinia amylovora  
infection may alternate with years with a much lower fire blight incidence, and even in an infected 
orchard, there may be years without fire blight symptoms.2828 
7.1158  While the Panel has found that most of the sci entific sources cited by the IRA in the context 
of importation step 2 seem respected and credible, th e Panel has also noted that the IRA should have 
used great caution when relying on the two studies th at find that mature, symptomless apples could 
carry fire blight.2829  As noted by Dr Paulin, the van der Zwet et al. (1990) study should have been 
considered with extreme caution, in light of the subsequent qualifications  made by its own first 
author.2830  In a declaration made in July 2002, Dr va n der Zwet advised that the results of his 1990 
study were obtained from fruit harvested in West Virg inia, United States, in a situation of severe fire 
blight.  In the view of that author, the results from the study "are not relevant for purposes of setting quarantine measures on exported, mature fruit".
2831  Dr Paulin also noted that other data, such as in the 
paper from Sholberg et al.  (1988), which found an infestation/infection rate of at least 33 per cent, 
                                                      
2825 Australia's IRA, Part B, p. 65. 
2826 See para. 7.272 above.  See also, Australia's IRA, Part B, p. 65. 
2827 Dr Paulin's reply to Panel question 25, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 177. 
2828 Dr Deckers's reply to Panel question 25, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 176.  See also, Dr Deckers's reply in Transcript of the Panel's meeting with experts, 
para. 323. 
2829 See para. 7.270 above. 
2830 Declaration of Tom van der Zwet, 16 July 2002, in Exhibit AUS-32.  Van der Zwet et al ., 
"Population of Erwinia amylovora  on External and Internal Apple Fruit Tissues" (1990), in Exhibit AUS-31.  
Dr Paulin's reply to Panel question 24, para. 175.  But see, Australia's IRA, Part B, pp. p. 63. 
2831 Declaration of Tom van der Zwet, 16 July 2002, p. 4, in Exhibit AUS-32.  Van der Zwet et al., 
"Population of Erwinia amylovora  on External and Internal Apple Fruit Tissues" (1990), in Exhibit AUS-31.  WT/DS367/R 
 Page 469 
 
 
 should be considered with care as the paper seems to describe a specific case  study, which may be 
different from the normal situation in an  orchard devoted to export of apples.2832 
7.1159  Also, the Panel has called into question in gene ral the IRA's reliance on the scientific papers 
mentioned in the context of importation step 2.2833  The Panel has held that because of the wide 
variation in the information reported in the various st udies cited in the relevant Part of the IRA, it is 
not possible to find justification from these studies for the probability range assigned by the IRA to 
importation step 2.  The results of the various studi es are not comparable, since the papers do not deal 
with the same type of fruit (some de al with mature fruit, others with immature fruit, and still others do 
not indicate with precision the type of fruit).  A dditionally, each paper has its own technique of 
detecting the bacteria.  As a result, no gene ral and reasonable conclusion for the presence of 
E. amylovora  on or in mature apple fruit can be based on the simple aggregation of these disparate 
results.2834 
7.1160  Australia explains that the external (epiphytic) infestation by E. amylovora  bacteria, which 
would be symptomless, was the IRA Team's primary concern for fire blight.2835  The IRA confirms 
this by stating that "[t]he importation ri sk scenario of particular relevance to E. amylovora  is the one 
that is associated with th e epiphytic (external) infestation.  Ep iphytic infestations can occur at the 
stem- and calyx-end and on the surface of mature fruit.  E. amylovora  cannot be detected by visual 
inspection."2836 
7.1161  Dr Deckers agrees, explaining that "[t]here is not sufficient qualified research available that 
indicate the importance of endophytic populations of Erwinia amylovora in apple fruits."2837  
Dr Paulin notes that to his knowledge there is no evidence of endophytically infected but symptomless 
and mature apple fruit.2838  Likewise, Dr Deckers explains that there is no scientific evidence in fire 
blight epidemiology that endophytically infected fruit would have a chance of developing into healthy-looking mature fruit.
2839 
7.1162  As regards epiphytic fire blight infestation, Dr Pa ulin explains that it is rare and has important 
prerequisites: "orchards (or areas) where there is an available inoculum (ooze), produced nearby by 
active symptoms of fire blight ... ."2840 
7.1163  Dr Deckers also explains that, although mature apple fruits may harbour fire blight bacteria 
epiphytically, such bacteria do not  survive or multiply well because "multiplication of the epiphytical 
                                                      
2832 Australia's IRA, Part B, pp. p. 56-57.  Reply of Dr Paulin to Panel question 24, para. 175.  Sholberg 
et al., "Occurrence of Erwinia amylovora  of pome fruit in British Columbia in 1985 and its elimination from the 
apple surface" (1988), in Exhibit AUS-34. 
2833 See para. 7.270 above. 
2834 See para. 7.274 above. 
2835 Australia's first written submission, para. 1084.  See also Australia's reply to Panel question 138 
after the first substantive meeting. 
2836 Australia's IRA, Part B, p. 52. 
2837 Dr Deckers's reply to Panel question 7, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 63. 
2838 Dr Paulin's reply to Panel question 6, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 45. 
2839 Dr Deckers's reply to Panel question 6, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 54. 
2840 Dr Paulin's reply to Panel question 7, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 57. WT/DS367/R 
Page 470  
 
 [fire blight] bacteria in the calyx end of the fruits will not occur;  multiplication of the bacteria will 
only occur on a medium rich in sugar or in amylum."
2841  As a result, according to Dr Deckers: 
"[T]he level of epiphytic populations of the [fire blight] bacteria on the apple fruits  
will remain low.  This will make it difficult to detect these low number of bacteria on the fruit skin.  The chance that this epiphytic population of [ E. amylovora ] serves as a 
new source of infestation in the orchard is very small is not described in the 
biological cyclus of an [ E. amylovora ] infection under orchard condition.  The calyx 
of the fruit is not a place where the [fire bli ght] bacteria can multiply;  in the best case 
the bacteria can survive fo r a period on that place."
2842 
7.1164  At the Panel's meeting with the experts, Dr Paulin  also stated that fire blight is not a truly 
epiphytic bacteria, and would be present on apple surfaces only in residual populations, diminishing 
over time: 
"[T]he term epiphytic is probably not the best term to be used in the case of 
E amylovora .  This is a bacteria which has a poor  fitness with plant surfaces.  So if 
you have bacteria on a plant surface, on apple trees surface, this is something which is 
temporary and not permanent.  We tend to qualify as epiphytes bacteria which are 
able to multiply on plant surfaces without producing symptoms.  This, I think everyone would agree, is not the case with E amylovora  on apple or pear.  We may 
have on apple and fire blight the presence of a bacteria which is sourced from elsewhere, such as ooze or progressive infection in the same tree in the orchard.  You may have, sometimes, a bacterial population.  If this population is not able to infect 
the plant tissues, for some reason, then this population will tend to disappear and you 
will have residual populations like the one that  was being evocated in the calyx of the 
fruits.  E amylovora  is not a true epiphytic bacteria."
2843 
7.1165  Similarly, in a written response to the Panel, Dr Paulin states that: 
"The available scientific evidence shows that E. amylovora  is not a true 'epiphyte', 
hence it cannot multiply, but only survive, with decreasing population on 
contaminated surfaces.  It could multiply , and then maintain a high level of 
population, only if it were able to infect the pl ant.  On a mature fruit this possibility of 
infection does not exist.  Mature fruits are then concerned only at best with transient 
populations, which are likely to be soon disappearing.  In addition, these transient populations would be present in the case where active, ooze producing fire blight 
lesions are present in the orchard at, or ju st before, picking time. Such a condition 
seems easy to avoid. 
Therefore mature symptomless fruit will not  bring in a packing house significant 
population of E. amylovora  on their surface.  Consequent ly, the evaluation of risk for 
this step seems too high, for mature symptomless fruits.  Decaying fruits and trashes 
would represent a higher risk."
2844 
                                                      
2841 Dr Deckers's reply to Panel question 7, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 62. 
2842 Ibid. 
2843 Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 230. 
2844 Dr Paulin's reply to Panel question 26, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 187-188.  WT/DS367/R 
 Page 471 
 
 
 7.1166  In another written response to the Panel, Dr Paulin similarly states that: 
"We have already commented on the pr obability of the presence of residual 
population of bacteria on fruit surface.  Some people prefer to use the word 'epiphytic' exclusively for microorganisms that are able to multiply , and therefore to reach high 
level of population on leaves or plant surface s, without producing symptoms.  This is 
typically the case of some phytopathogenic bacteria called Pseudomonas syringae  
(some pathovars of this species).  Such a capacity does not exist  in the case of 
E amylovora  (Thomson 2000), except on stigma in flowers.  Therefore the bacterial 
cells eventually present on the fruit surface coul d not multiply on the same site.  They 
should be first carried to a suitable site for multiplication  (i.e. an infection site, 
presumably an open flower on a host plant)."
2845 
7.1167  Dr Paulin is also sceptical about the likeli hood that apples entering packing houses free of 
E. amylovora  would become contaminated during processing (importation step 5): 
"The liquid medium (in which mature symptomless apple fruits are immersed during 
the process), even without disinfectant, can not be considered as a culture medium for  
E. amylovora :  an artificial medium for such bacteria must content among other 
elements a rather high level of soluble suga r (0,5g/l is a minimum, 5g/l is the standard 
for a culture medium for  E. amylovora ).  Therefore it is rather a dilution effect that 
could be expected from this step.  In this particular case, the probability suggested in 
the IRA seems to be strongly exaggerated.   Only if decaying apples (supposedly 
decaying from E. amylovora  infection-then immature and not 'symptomless') or large 
amount of infected trashes, were present, the dilution effect in a non-disinfectant 
medium could lead to a significant amount of bacterial cells on fruit surfaces.  This seems very unlikely in practical conditions. 
The scientific evidence is that, in artificial medium E. amylovora  does not compete 
very successfully against natural antagonistic bacteria (such as Pantoea agglomerans  
or Pseudomonas fluorescens,  Vanneste, 2008), which are naturally found in high 
concentration on plant and on fruit su rface, and which would compete with 
E. amylovora , thus preventing a multiplication of E. amylovora , if present.  Finally I 
would therefore consider that the risk of contamination of apples by packing shed 
machinery is negligible."
2846 
7.1168  Likewise, as regards the likelihood of clean fruit being contaminated by E. amylovora  during 
palletization, quality inspection, containerization a nd transportation (importation step 7), Dr Paulin 
explains that: 
"In its analysis of this step, IRA does not  provide any scientific  evidence that such 
external pollution can happen, except in the case of oozing fruits.  It referred to van 
der Zwet 1999 paper, which has already been considered as not providing the correct 
information on the case, which the author r ecognizes himself.  In addition, internally 
infected fruits immature producing ooze, if any, would have been discarded well 
before this step. 
                                                      
2845 Dr Paulin's reply to Panel question 19, in List of Replies from the scientific experts to questions 
posed by the Panel, para 140 (original emphasis). 
2846 Dr Paulin's reply to Panel question 30, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 216-217. WT/DS367/R 
Page 472  
 
 I would consider the probability to be nil in this case, for symptomless mature 
apples."
2847 
7.1169  Dr Paulin adds that: 
"Ooze can only be produced following a progressive invasion of susceptible tissue by 
the bacteria.  Oozing out from mature fruit is  not described in fire blight symptoms.  
It could possibly (?) happen in the case of  a delayed evolution originating from an 
infection of an immature fruit, but as far as I know, this as not been described in the 
scientific literature.  The only scientific b asis for oozing on mature fruit (?) is from 
van der Zwet 1990, which has already been discussed, and which can be considered 
as irrelevant for the case."2848 
7.1170  Likewise, Dr Deckers states that "[i]nternally infected mature fruits will not be able to 
produce bacterial ooze.  These fruits will immediatel y be invaded by fungal infections.  Ooze 
production occurs only on immature fruits where the st arch of the immature fru its is used by the EA 
bacteria during the multiplication phase."2849 
7.1171  Dr Paulin explains that transfer to  a host plant is also highly unlikely: 
"The transfer to an host plant could be performed most likely by insects or wind 
driven rain, but the probability of successful localization at the right place should be very low, and the probability of infection even lower.  The highest probability I can 
think of is a pollinating insect taking the fe w bacterial cells to the hypantium of a 
flower of an host plant.  This remain s unlikely because trace bacterial populations 
(not multiplying) will be hardly grasped by  insects (it would be easier in the case of a 
multiplying population, where cells are embe dded in exudate).  Finally the likelihood 
of successful multiplication on the hypantium and infection would be extremely low.  
In addition, it would be necessary that su ch open flower be available when these 
surface polluted fruits are present.  All this  cannot be considered to constitute an 
evidence."
2850 
7.1172  Dr Paulin confirms this in one of his later written responses to the Panel: 
"E. amylovora  is not able to multiply on plant su rface (except for a short time, on the 
hypantium of stigmates in flowers).  It is  difficult to imagine conditions conducive to 
actively growing cells in na tural conditions on the surface of a symptomless apple. 
The spread of surface population from fruit to  infection sites is similarly hard to 
imagine, especially because these non-multiply ing cells are not embedded in exudate, 
and therefore not attractive to insects or ot her vectors.  In ar tificial inoculations, 
bacterial populations at low level need to be placed very precisely  at the right site of 
                                                      
2847 Dr Paulin's reply to Panel question 32, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 227-228. 
2848 Dr Paulin's reply to Panel question 33, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 230. 
2849 Dr Deckers's reply to Panel question 33, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 229. 
2850 Dr Paulin's reply to Panel question 19, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 141.  WT/DS367/R 
 Page 473 
 
 
 infection, to successfully infect its host plant (Crosse et al.).  This is probably a 
difficulty impossible for the bacteria  to tackle in natural conditions."2851 
7.1173  Dr Deckers agrees that the chan ces of epiphytic fire blight infestation on mature apple fruit 
sufficient to initiate an infection on a host plant w ould be very low.  "The chance that the epiphytic 
bacteria that can be present on mature apple fruits initiate an infection on an other host plant will be 
very low.  The critical point will be the transfer of viable [fire blight] bacteria to susceptible organs of 
an other host plant where the bacteria can mu ltiply before a new infection can take place."2852 
7.1174  Dr Deckers confirms this in a later written r esponse to the Panel.  "As mentioned earlier there 
is a possibility that mature apple fruit can harbour viab le epiphytic [fire blight] bacteria.  The step of 
the transfer from these infected fruits  to the possible host plant stays the most critical step and will be 
difficult to prove."2853 
7.1175  Dr Paulin adds that "it can be assumed that most of the time during the year most host plants 
should not be at a receptive stage when the impor t of apple would take place (peak in winter)."2854  
Likewise, Dr Deckers states that "[d]uring dormant season, there is no infection possibility of the fire 
blight host plants when the host plants don't have the susceptible organs or when the climatological 
conditions are not allowing bacterial multiplication."2855 
7.1176  Further, Dr Deckers explains that: 
"Mature symptomless apple fruits coming from heavily infected orchards can harbour 
an epiphytic population of [fire blight] bacteria in their calyx end or as bacterial ooze sticked [sic] on the fruit skin and dried out, but the chance that this bacterial 
population will be capable to start a new infection on a susceptible host plant under 
natural conditions is rather low. 
When the fruits are harvested from orchard without active fire blight symptoms in 
and around the orchard, without the presence of hail and when the fruits have been 
disinfected during preparation in the pack ing house, the chance for an initiation and 
establishment of the disease under natural cond itions in another area is considered to 
be extremely low."
2856 
7.1177  Dr Paulin confirms this, by explaining that: 
"[M]ature symptomless apple may harbour some surface cells of E. amylovora,  at 
least if collected in an orchard showing active symptoms before cropping time.  The only 'mechanisms' I can think of for the transfer  of such bacteria to infection site on a 
living susceptible host plant at the proper stage of receptivity are: 
                                                     
 
2851 Dr Paulin's reply to Panel question 27, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 190-191 (original emphasis). 
2852 Dr Deckers's reply to Panel question 27, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 189. 
2853 Dr Deckers's reply to Panel question 37, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 252. 
2854 Dr Paulin's reply to Panel question 10, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 78. 
2855 Dr Deckers's reply to Panel question 10, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 84. 
2856 Dr Deckers's reply to Panel question 18, in List of  Replies from the scientific experts to questions 
posed by the Panel, paras. 135-136. WT/DS367/R 
Page 474  
 
 – Insects (whatever they are, pollinating or not), which could take bacterial 
cells to open blossoms, or to  wounds on growing shoots, 
– Wind driven rain. These two 'mechanisms' suppose a close pr oximity between these fruits and the 
infection sites.  Both are questionable , due to the expected low or very low level of 
the bacterial population present on these fruits, and its localisation (calyx), which 
makes the accessibility of cells rather difficult.   In addition, bacterial cells on fruit are 
probably not embedded in ooze (as they are when actively multiplying from active lesions) and therefore not well protected fro m adverse conditions, a nd, which is more, 
probably have no the adhesive capacity, which is said to be a facilitating factor for 
transportation by insects."
2857 
7.1178  Further, Dr Deckers explains that the chance of a successful transfer and multiplication of 
bacteria will be rather exceptional: 
"There will be no multiplication of the ep iphytic bacterial population on the fruit 
surface or in the calyx tissue.  The fire b light bacteria are not surviving well as an 
epiphytic bacterial population.  The bact eria should be transferred first to a 
susceptible organ of a fire blight host pl ant like a stigma of a flower where the 
bacteria can multiply and start a new inf ection.  The chance for such a successful 
transfer and multiplication of bacteria will be rather exceptional."2858 
7.1179  Dr Deckers adds that: 
"The [ Erwinia amylovora ] bacteria can indeed multiply rapidly but not on the 
epiphytic surfaces of the fruits.  This multiplication can only occur on susceptible 
organs like immature fruitlets or on the stigma of the flowers and only when the 
climatological conditions (temperature and relative humidity) are optimal for 
bacterial growth.  The question here is if these circumstances will be present at the time that the fruits from New Zealand arrives in Australia."
2859 
7.1180  Likewise, Dr Paulin states that: 
"The rapid multiplication of E. amylovora  in natural orchard environment can be 
observed only after infection (or artificial i noculation) of a susceptible host plant.  
The values indicated in the literature are st rictly linked to the conditions in which 
they are obtained (no nutrient limitation, no water limitation, opt imal and constant 
temperature..).  They are obtained from credible scientific sources, but need to be 
considered as the maximum potential  for the bacterial multiplication, in absence of 
any limiting factor.  In addition the multiplication rates obtained in the laboratory (for example on sections of immature fruits ) follow relatively massive inoculations 
with young fresh bacterial cultures. 
The most likely limiting factor for E. amylovora  in orchard condition is the site where 
it could multiply.  Except in laboratory conditions, no multiplication of  E. amylovora  
                                                     
 
2857 Dr Paulin's reply to Panel question 18, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 137-138 (original emphasis). 
2858 Dr Deckers's reply to Panel question 19, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 139. 
2859 Dr Deckers's reply to Panel question 40, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 261.  WT/DS367/R 
 Page 475 
 
 
 outside an infection of host plant (the firs t step being on the hypantium) has ever been 
described.  So a rapid multiplication is possible in an orchard, but only after  infection, 
in the plant tissues."2860 
7.1181  These responses from the experts indicate that the likelihood of fire blight spreading through 
mature, symptomless apples is very low.  Indeed, as regards mature symptomless apples in general, 
Dr Deckers notes that: 
"In the biological cycle of [ E. amylovora ] mature apples are not included as an 
important way of spreading the fire blight  disease.  In contrast to the absence of 
specific measures on export on fruits, specific measures are imposed in Europe in the 
countries with fire blight around the fruit tree nurseries with the aim to prevent export 
of contaminated trees from infected countries to countries free of fire blight.  The 
trade of apple fruits between the differen t countries is not subjected to special 
measures.  This means that the spread of  the fire blight disease by fruit tree nursery 
material is considered to be much more important than the risk for spread by the 
export of contaminated apple fruits."2861 
7.1182  Dr Deckers adds that: 
"Between the different countries in the Eu ropean union, the risk for fire blight 
introduction in new countries by infected plant material ( variety and or rootstock) is 
estimated much more important than the introduction possibility by infected apple fruits.  In Spain there is a strong indication that some of the fire blight infections was [sic] related to the import of infected hos t plants coming from Belgium.  Therefore 
there is a European legislation regulating the control measures in and around the fruit 
tree nurseries.  The risk for introduction of  the disease by infected  fruits is estimated 
much lower and no special measures for th e export of fruits are undertaken between 
the different countries in Europe."
2862 
7.1183  Likewise, Dr Paulin states that: 
"In my view, the importation of bacteria with  apple is probably possible.  The further 
step from this imported bacterial population to a new plant in Australia is probably 
even less likely.  And I think that the tota l process, the risk represented by the total 
process, is probably of the same order of magnitude as the transport of contaminated insects by natural way from New Zealand to Australia by air jet or things like that.  So that is my personal view, that there is a possibility which level of risk is not far 
higher than the natural spreading possibilit y of the bacteria to go from place to 
another with something else, I would say, which has no connection with trade of apples."
2863 
7.1184  In its conclusions under Articles 5.1 and 5.2 re garding fire blight exposure, establishment and 
spread, the Panel has noted that the experts agreed  that there is a theoretical possibility of the 
importation of fire blight bacteria with apple fruit.  Dr Paulin acknowledged that, although he is not 
                                                      
2860 Dr Paulin's reply to Panel question 40, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 262-263 (original emphasis). 
2861 Dr Deckers's reply to Panel question 6, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 52. 
2862 Dr Deckers's reply to Panel question 16, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 123. 
2863 Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 380. WT/DS367/R 
Page 476  
 
 aware of any scientific evidence to support such scen ario, as a scientist it is not possible to exclude 
that it may happen:
2864 
"Australia has shown that you can imagine a system in which mature apple fruits can 
carry the bacteria from New Zealand to Austra lia.  The point is that it is difficult to 
estimate the value of 'can'.  Is it a rare possibility, a frequent event or something 
exceptional?  This is far more difficult to tell. ... [A]nything which goes from 
New Zealand or from a contaminated c ountry to another country 'can' carry 
something including bacteria, including pathogenic bacteria, that is the minimum level.  Then you may have specific transport of specific bacteria, e.g., with rootstock 
material which would be the maximum dange r for the installation of the disease in a 
new country.  So, the apple fruit, which is  in-between these two limits, cannot be 
excluded.  That that can be considered as  a real risk, is the matter in question."
2865 
7.1185  The Panel has noted also that Dr  Deckers agreed that, in other countries when they are trying 
to limit the risk of introduction of fire blight, "the y are not talking in the first place about fruits, they 
are talking more about plant material and potential infections on plant material, root stock or variety 
materials".2866 
7.1186  The Panel has concluded that the experts did 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.  They found even le ss likely the further step of transfer from this 
imported bacterial population to a new plant in Australia.2867  The likelihood of introduction via 
mature apple fruit would, in any event, be less than  that of introduction via plant material or root 
stock.  There would not be a higher likelihood of introducing Erwinia amylovora  through mature 
apple fruit than "the natural spreading possibility of  the bacteria to go from place to another with 
something else ... which has no connection with trade of apples".2868 
7.1187  When asked specifically whether restricting imports of New Zealand apples to mature, 
symptomless apples would achieve Australia's ALOP , Dr Paulin responds in the affirmative: 
"'Mature symptomless apples' 
Mature :  Indicates that fruits have completed their development on trees, and 
therefore that they were not infected at  an early stage (otherwise they would not 
achieve this development up to the mature stage).  Mature fruits are recognized as 
resistant to infection:  they do not develop symptoms if inoculated , because they do 
not allow the multiplication of bacteria. 
Symptomless  means that they show no fire blight (or other disease) symptoms:  this 
eliminates infected fruits issued from early infections. 
                                                      
2864 Dr Paulin's reply to Panel question 37, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 253.  See also, Dr Paulin's reply in Transcript of the Panel's meeting with experts, 
para. 380. 
2865 Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 226.  See also, Dr Paulin's 
reply in Transcript of the Panel's meeting with experts, para. 254. 
2866 Dr Deckers's reply in Transcript of the Panel' s meeting with experts, para. 379.  See also, 
Dr Deckers's reply to Panel question 16, in List of Replies from the scientific experts to questions posed by the Panel, para. 123. 
2867 See para. 7.443 above. 
2868 See para. 7.445 above and Dr Paulin's reply in Transcript of the Panel's meeting with experts, 
para. 380.  See also, Dr Paulin's reply to Panel question 16, in List of Replies from the scientific experts to 
questions posed by the Panel, paras. 129-131.  WT/DS367/R 
 Page 477 
 
 
 Both these measures are actually necessary to eliminate the more evident  risks of 
transfer of the bacteria with fruit.  It de creases the risk drastically in eliminating the 
opportunities of carrying high population of E. amylovora  which are associated with 
tissues harbouring progressive infection,  for example in immature fruits.  
Nevertheless it cannot be considered as elimin ating absolutely the risk of introduction 
of low (external) bacterial populations associated with fruits.  It can then be 
considered to decrease the likelihood for en try of the bacteria with fruits from very 
low to extremely low, in the ALOP."2869 
7.1188  While Dr Paulin states that limiting imports  from New Zealand to mature, symptomless 
apples would "decrease the likelihood for entry of the bacteria with fruits from very low to extremely 
low, in the ALOP", in response to the Panel's qu estion No. 15 he also states that it would be even 
safer to combine New Zealand's alternative measure with Australia's contested fire blight measures: 
"The restriction of export to mature sy mptomless apples would make even safer the 
different measures taken by Australia (disin fection, storage...), but could not replace 
any of them."2870 
7.1189  The Panel notes the answers quoted above by Dr Paulin, where he casts doubt on the key 
importation steps reviewed by the IRA in the context of  fire blight.  In summary , Dr Paulin states that 
the risk represented by the total process of importation: 
"[I]s probably of the same order of magnitude as the transport of contaminated insects 
by natural way from New Zealand to Australia by  air jet or things like that.  So that is 
my personal view, that there is a possibility which level of risk is not far higher than 
the natural spreading possibility of the bacteria to go from place to another with 
something else, I would say, which has no connection with trade of apples."2871 
7.1190  Taking these answers of Dr Paulin together with  his answer to the Panel's Question No. 15, 
the Panel finds that the totality of Dr Paulin's expe rt advice indicates that while, as a matter of fact, 
combining New Zealand's alternative measure with Australia's contested measures will make the trade 
in apples "even safer", limiting trade to "mature sy mptomless apples" renders the risk extremely low 
and akin to the risk of the bacteria making its wa y from New Zealand to Australia on air jet or some 
other mode of transport not connected to trade in apples. 
7.1191  In his responses cited above Dr Deckers explai ns 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 fire blight control measures.  This said, Dr Deckers is sceptical whether New Zealand's 
alternative measure would achieve Australia's ALOP on its own: 
"The limitation of apple exports to mature  symptomless apples is not enough to 
achieve Australia's ALOP.  Traceability of the fruits to the level of orchard where the 
apples have been produced is necessary for the risk evaluation in Australia.  
Fruits from heavy infected orchards or fro m orchards with hail damage can harbour 
the bacteria in the calyx end of the fruits."
2872 
                                                      
2869 Dr Paulin's reply to Panel question 15, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 118-121. 
2870 Dr Paulin's reply to Panel question 15, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 122. 
2871 Dr Paulin's reply in Transcript of the Panel's meeting with experts, para. 380. 
2872 Dr Deckers's reply to Panel question 15, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 117. WT/DS367/R 
Page 478  
 
 7.1192  Despite this latter response from Dr Deckers, the Panel finds that the previously cited 
statements from Dr Deckers and Dr Paulin show that they consider 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 poi nts in the import scenario assessed by the IRA. 
7.1193  As noted above, in the context of Article 5.5, the panel in Australia – Salmon  explained that 
its legal analysis is different from the scientific  assessment and certainty that scientific experts 
consulted by panels might prefer.
2873  The Panel considers that this also applies in the context of 
Article 5.6 of the SPS Agreement, in particular when assessing the second condition of the Article 5.6 
test.  If the Panel tried to achieve the same scientific  certainty as scientific experts, it would slip into 
conducting a de novo review.  If the Panel were to recoil from carrying out its legal analysis merely 
because it could not achieve the same scientific certa inty, it would not be acti ng in conformity with 
Article 11 of the DSU.  As noted above, what the Panel has to look at, in the context of the second 
prong of Article 5.6 of the SPS Agreement, is wh ether New Zealand has ra ised a presumption, not 
successfully rebutted by Australia, that the altern ative measures would achieve Australia's ALOP.  
Obviously, the Panel can conclude this only if Ne w Zealand has advanced sufficient and convincing 
arguments and evidence to that effect. 
7.1194  The Panel notes that it has found that New Zeal and has demonstrated that the IRA does not 
constitute a proper risk assessment under Article s 5.1 and 5.2 of the SPS Agreement and that 
consequently the resulting fire blight measures ar e also inconsistent with Article 2.2 of the 
SPS Agreement.  The Panel has reached this find ing partly based on arguments from New Zealand 
comparing the IRA's importation scenario and ri sk assessment with the importation of mature, 
symptomless apples. 
7.1195  The Panel also notes that the experts consider  that New Zealand would only export to 
Australia mature, symptomless apples that would al so be free of trash.  Dr Deckers describes the 
Pipfruit New Zealand, Class 1 export fruit standard as  "a standard method of maturity and fruit quality 
determination."2874  Likewise, Dr Paulin confirms that the Pipfruit New Zealand, Class 1 export fruit 
standard corresponds to a "high standard of quality"  and "[t]he specifications for absence of damage 
are of a proper level of precision to guarantee 'symptomless fruits'".2875  Dr Latorre finds that 
"the requirements established by Pipfruit New Zealan d with regard to maturity and absence of fruit 
damage are acceptable."2876  He also suggests that in light of the relevant exhibit submitted by 
New Zealand there is no risk that apples exporte d from New Zealand "will not always be mature, 
asymptomatic and free of trash".2877  Likewise, according to Dr Schrader: 
"With regard to the requirements for maturity, the inclusion of background colour and 
ethylene content as established by Pipfruit New Zealand goes beyond the 
requirements asked by the Streifindex.  Regarding absence of damage, class 1 as defined in Exhibit NZ-93 is more detailed than e.g. quality standards required by the 
European Union, where trade class 1 refers to good quality, slight shape and 
                                                     
 
2873 Panel Report on Australia – Salmon , para. 8.126 (emphasis added). 
2874 Reply of Dr Deckers to Panel question 2, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 20. 
2875 Dr Paulin's reply to Panel question 2, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 22. 
2876 Dr Latorre's reply to Panel question 2, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 21. 
2877 Dr Latorre's reply to Panel question 3, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 29.  WT/DS367/R 
 Page 479 
 
 
 development defects, slight colouring de fects, only slightest bruises, sufficient 
firmness."2878 
7.1196  Further, the Panel has found in the context of Articles 5.1 and 5.2 of the SPS Agreement that 
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 (corresponding to the qualitative descriptor "the  event would almost certainly not occur") is 
not properly justified in the IRA and leads to an overestimation of the probability of entry, 
establishment and spread of fire blight.2879 
7.1197  Australia has a qualitative ALOP, defined as "pr oviding a high level of protection aimed at 
reducing risk to a very low level, but not to zero."2880  In light of the above considerations, the Panel 
finds that New Zealand has raised a sufficiently convincing presumption, not successfully rebutted by 
Australia, that the alternative fire  blight measure of restricting imports of New Zealand apples to 
mature, symptomless apples would meet this ALOP.  Accordingly, this alternative measure fulfils the 
second condition of the Article 5.6 test in the context of fire blight. 
Analysis of the second condition of the Article 5.6 test for European canker 
7.1198  As outlined above2881, the Panel will assess first whether New Zealand has demonstrated that 
Australia's calculation of the European canker risk resulting from the importation of New Zealand 
apples is exaggerated.  Under Artic le 5.1 of the SPS Agreement, the Pa nel has already found this to be 
the case.  In particular: 
(a) For importation step 1 , the Panel has noted that New Zealand has not called into 
question the IRA's estimation of the likelihood that N. galligena  is present in the 
source orchards in New Zealand.  The Pane l has pointed out that the IRA's value of 
this importation step "takes into account th e variations in climatic conditions across 
New Zealand, and the information indica ting that about 95% of the apple export 
production in New Zealand comes from orchar ds in areas where the disease has either 
never been recorded or the disease occurs only sporadically in very wet seasons."2882 
(b) For importation step 2 , the Panel has noted that the IRA's estimation of the likelihood 
that fruit coming from an infected or infested  orchard is infected or infested with 
N. galligena  does not find sufficient support in the scientific evidence relied upon by 
the IRA and is therefore not coherent and objective.2883  The Panel has also noted that 
the IRA does not contain adequate scientific  evidence that would allow an estimation 
of the frequency of apple infection and la tency in New Zealand or elsewhere.  
Moreover, the studies on fruit infection cited in the IRA are based on research 
conducted in areas or periods with frequent su mmer rainfalls at harvest.  Accordingly, 
the Panel has found that the IRA fails to pr operly take into account the existence of 
climatological conditions in New Zealand that would be necessary for inoculum production, dissemination and infection.
2884 
                                                      
2878 Dr Schrader's reply to Panel question 2, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 23. 
2879 See paras. 7.484, 7.496 and 7.508 above. 
2880 Australia's IRA, Part A, p. 3. 
2881 See para. 7.1143 above. 
2882 See paras. 7.520-7.521.  Australia's IRA, Part B, p. 121. 
2883 See para. 7.545 above. 
2884 See para. 7.544 above. WT/DS367/R 
Page 480  
 
 (c) For importation step 3
, the Panel has found that the IRA's estimation of the likelihood 
that clean fruit is contaminated with N. galligena  during picking and transport to the 
packing house is not sufficiently supporte d by the scientific evidence that the IRA 
relied upon and, accordingly, is  not coherent and objective.2885  In this regard, the 
Panel has noted Dr Latorre's opinion that the IRA's analysis overestimates the risk of 
inoculum dispersal.2886  The Panel has pointed out that the IRA does not contain 
scientific evidence regarding the possibility that latently infected but symptomless 
fruit could develop rot and generate N. galligena  spores, which could then be 
transferred to clean fruit.  Also, the Panel h as noted that there is no indication in the 
IRA of the existence of climatological c onditions in New Zealand that are necessary 
for inoculum production, dissemination and infection of clean fruit during picking 
and transport to the packing house.  The IRA's discussion fails to take into account 
that conidia are poor epiphytes.  Further, there is no scientific evidence in the IRA to 
support the proposition that perithecia would play  a role in the contamination of clean 
fruit.2887 
(d) For importation step 4 , the Panel has concluded that the IRA's estimation of the 
likelihood that N. galligena  survives routine processing procedures in the packing 
house is not objectively justifiable.2888  There is no explanation in the IRA for the 
estimation that there would be a minimum 70 per cent likelihood that N. galligena  
survives routine processing procedures in th e packing house, and a most likely value 
of 85 per cent.2889 
(e) For importation step 5 , the Panel has found that the IRA's estimation of the likelihood 
that clean fruit is contaminated by N. galligena  during processing in the packing 
house is not sufficiently supported by the scientific evidence relied upon by the IRA 
and is accordingly not coherent and objective.  There is no support in the IRA for the estimation made for the likelihood of this importation step either in the scientific 
evidence cited in the IRA, nor on th e IRA's discussion in this regard.
2890 
(f) For importation step 6 , the Panel has found that the IRA's estimation of the likelihood 
that N. galligena  survives palletization, quality inspection, containerization and 
transportation to Australia is not sufficientl y supported by the scientific evidence that 
the IRA relied upon and, accordingly,  is not coherent and objective.2891  T h e  I R A  
acknowledges that some infected fruit not det ected during sorting may be identified at 
quality inspection.  Moreover, the IRA fails to  take into account the effects that the 
processes occurring during this step could have  on external infestation.  The scientific 
evidence cited in the IRA does not support the estimation that there would be a 100 per cent likelihood that Neonectria galligena  survives palletisation, quality 
inspection, containerization and transporta tion to Australia.  The likelihood of the 
removal of some surface contamination in fr uits and the detection of some latently 
infected apples during this step may be very small, but it would be different from zero.
2892 
                                                      
2885 See para. 7.573 above. 
2886 See para. 7.562 above. 
2887 See para. 7.572 above. 
2888 See para. 7.594 above. 
2889 See para. 7.593 above. 
2890 See para. 7.606 above. 
2891 See para. 7.620 above. 
2892 See para. 7.619 above.  WT/DS367/R 
 Page 481 
 
 
 (g) For importation step 7 , the Panel has found that the IRA's estimation of the likelihood 
that clean fruit is contaminated with N. galligena  during palletization, quality 
inspection, containerization and transporta tion is not supported by a coherent and 
objective reasoning.2893 
(h) For importation step 8 , the Panel has noted that New Zealand has not called into 
question the IRA's estimation of the likelihood that N. galligena  survives and remains 
with the fruit after on-arrival minimu m border procedures is 1 (100 per cent).2894  In 
this context, the Panel has also noted that the IRA provides that "[o]n-arrival 
inspections of documentation would fail to  detect fruit rot symptoms or latent 
infections, and these would remain when th e fruit arrives in Australia.  The likelihood 
rating for this importation step would not be significantly reduced by any normal on-
arrival procedure."2895 
7.1199  In the light of the Panel's conclusions re garding the IRA's estimations of individual 
importation steps, and of the lack of separate ju stification and evidence in the IRA regarding the 
estimated overall likelihood of importation, the Pa nel has found that the IRA's estimation of the 
overall probability of importation  is not supported by the scientific evidence relied upon by the IRA 
and, accordingly, is not coherent and objective.2896  The Panel has held that if the estimations of one or 
more of the individual likelihoods are questionable,  because those estimations are either not supported 
by adequate scientific evidence or not based on a coherent and objective reasoning, the overall figure 
necessarily becomes questionable.  Moreover, the IR A does not attempt to find justification for the 
estimated overall probability of importation, other than the arithmetic aggregation of the different 
individual likelihoods represented by each importation step.2897  The Panel has noted Dr Sgrillo's view 
that this overall probability value could be overestimated.2898  The Panel has also noted Dr Latorre's 
statement that the overall value falls out of the range  that could be considered legitimate on the basis 
of general knowledge rega rding the European canker.2899  Dr Swinburne agreed, adding that "all the 
uncertainty in the calculations ... does not inspire confidence".2900 
7.1200  In estimating the probability of entry, est ablishment and spread of European canker , the IRA 
has taken into account the following factors in additi on to the probability of importation:  "proximity", 
i.e. the proportion of utility points near host plants  susceptible to the pest in each exposure group;  
the probability of exposure of a susceptible host plant in the exposure group to the pest by an 
infested/infected apple discarded near it;  the pr obability of establishment;  and the probability of 
spread.2901 
7.1201  With regard to the proximity  values, the Panel has found that New Zealand has not made a 
prima facie case that the IRA's discussion on utilit y points and estimated pr oximity ratings for the 
combination of each utility point with exposure groups  is not objectively justifiable.  At the same 
                                                      
2893 See para. 7.631 above. 
2894 See para. 7.637 above.  See, Australia's IRA, Part B, p. 128. 
2895 See para. 7.636 above.  See, Australia's IRA, Part B, p. 128. 
2896 See para. 7.649 above. 
2897 See para. 7.646 above. 
2898 Ibid.  See also, Dr Sgrillo's reply to Panel question 84, in List of Replies from the scientific experts 
to questions posed by the Panel, para. 489. 
2899 See para. 7.647 above.  See also, Dr Latorre's reply to Panel question 84, in List of Replies from the 
scientific experts to questions posed by the Panel, para. 486. 
2900 See para. 7.648 above.  Dr Swinburne's reply to Panel questions 84 and 85, in List of Replies from 
the scientific experts to questions posed by the Panel, para. 497. 
2901 See para. 7.650 above.  See also, Australia's IRA, Pa rt B, p. 129.  See also, Australia's IRA, Part B, 
p. 17. WT/DS367/R 
Page 482  
 
 time, the Panel has noted that the IRA offers little explanation and supporting evidence for its 
reasoning regarding the estimation of the different proximity values.
2902 
7.1202  In relation to exposure , the Panel has found that the IRA's conclusions on this value do not 
rely on adequate scientific evidence and, accordingly, are not coherent and objective.2903  The Panel 
has found with respect to waste disposal, for exampl e, that the IRA's assertion that consumer waste 
would present "potential inoculum sources for transfer  to susceptible host plants" is not supported by 
evidence.  The IRA's exposure analysis also rests on assertions regarding the possibility that latently 
infected but symptomless fruit could develop rot and generate N. galligena  spores, the mummification 
of fruits, and the possibility that perithecia would play a role in the contamination of new hosts that do 
not find sufficient support in the scientific evidence  relied upon.  With respect to the survival and 
viability of the fungus, there is no support in the evidence for the IRA's apparent assumption that 
inoculum for infection would always be available.  With respect to the transfer mechanism for N. galligena , the Panel has noted that the IRA does not c ontain scientific evidence that wind can serve 
as a dispersal mechanism for conidia in the absence of  rain.  Also, the IRA's reasoning is not coherent 
and objective, as it fails to take into account that di spersion of conidia by rain splash would be very 
limited and, in order to achieve transfer, would also require certain climatic conditions, which are 
unlikely to be present in Australia, particularly du ring the most critical periods for infection.  The 
Panel has found that there is no evidence in the IR A in support of the possibility that birds or insects 
could be involved as vectors in the transfer of N. galligena .  The IRA's discussion on the availability 
of entry points fails to take into account that conidia are poor epiphytes and will not survive as a 
surface contaminant.  Regarding the discussion on inoc ulum dose, the Panel has pointed out that the 
IRA fails to explain how it took into account th e inoculum dose necessary for infection when 
estimating the probability of exposure to susceptib le host plants.  Moreover, the IRA fails to 
adequately recognize the importance of the number of spores and other factors, such as the host 
cultivar, for the likelihood of initiating an infectio n.  Finally, the Panel has found that the IRA's 
discussion regarding environmental factors fails to take into account that the necessary climatological 
conditions for inoculum production, dissemination and infection, in terms of the appropriate 
combination of cool temperatures and wetness, are unlikely to be present in Australia, particularly 
during summer and early fall, the most critical periods for infection.
2904 
7.1203  The Panel has found that the IRA's estimation of the overall entry, establishment and spread 
of European canker  does not rely on adequate scientific evid ence and, accordingly, is not coherent 
and objective.2905  The IRA tends to exaggerate the risk, fo r example, by not taking into account that 
any epiphytical fungal populations would likely be small and diminishing and that the number of 
latently infected apples would also diminish over tim e, by not considering the climatic conditions that 
are necessary for inoculum production, dissemination and infection, and by assuming that inoculum 
for infection and infection sites would be always available.  The IRA instead emphasizes a number of factors and assumes some hypotheses that would tend to increase the likelihood of entry, 
establishment and spread, despite th e absence of adequate scientific evidence to support these factors 
or even in the face of availa ble evidence to the contrary.
2906 
7.1204  The Panel has also found that the IRA's evalua tion of the potential consequences associated 
with the entry, establishment or spread of Europ ean canker into Australia does not rely on adequate 
scientific evidence and, accordingly, is not coherent and objective.2907 
                                                      
2902 See para. 7.675 above. 
2903 See para. 7.717 above. 
2904 See para. 7.715 above. 
2905 See para. 7.749 above. 
2906 See para. 7.744 above. 
2907 See para. 7.777 above.  WT/DS367/R 
 Page 483 
 
 
 7.1205  Regarding the alleged methodological flaws iden tified by New Zealand, the Panel has found 
that the choice of a probability interval and midpoi nt for events with a "negligible" likelihood of 
occurring, as well as the combination of this probability  interval with the use of a uniform distribution 
to model the likelihood of these events, are not properly justified in the IRA and lead to an 
overestimation of the probability of entry, establishment and spread of European canker.2908 
7.1206  The Panel has found that, in regard to the anal ysis of the likelihood of entry, establishment 
and spread of European canker, Australia's IRA is not a proper risk assessment within the meaning of 
Article 5.1 and paragraph 4 of A nnex A of the SPS Agreement.  The flaws also constitute a failure by 
the IRA to take sufficiently into account factors such  as the available scientific  evidence, the relevant 
processes and production methods in New Zeala nd and Australia, and the actual prevalence of 
European canker, as required by Article 5.2 of  the SPS Agreement.  Accordingly, Australia's 
European canker measures contested by New Zealand are inconsistent with Articles 5.1 and 5.2 and, 
consequently also inconsistent with  Article 2.2 of the SPS Agreement.2909 
7.1207  In the light of these findings under Articles 5.1 and 5.2 of the SPS Agreement, the Panel 
concludes that for the purposes of its Article 5.6 cl aim New Zealand has made the case that Australia's 
IRA overestimates the European canker risk resu lting from imports of New Zealand apples.  Thus, 
New Zealand has cast doubt on whether the European  canker risk would exceed Australia's ALOP to 
the extent calculated by the IRA, and warrant as st rict risk management measures as those developed 
by the IRA.  Further, New Zealand has cast doubt on whether the unrestricted European canker risk 
would necessarily exceed Australia's ALOP.  Accordingl y, there is no reason to believe that the less 
strict alternative measure suggested by New Zealand would not meet Australia's ALOP. 
7.1208  As outlined above, the Panel now turns to assessing more directly whether, assuming that risk 
management measures are necessary, New Zealand has raised a presumption, not successfully rebutted by Australia, that its alternative measure sufficiently reduces the European canker risk to, or 
below, Australia's ALOP.
2910 
7.1209  As in the context of fire blight, the IRA did not formally consider restricting New Zealand 
apple imports to mature, symptomless apples as a risk management measure for European canker.  
In fact, the IRA's main risk scenario is "any latent infection in fruit that would not have been detected 
at harvesting or during pro cessing in the packing house".2911  "The risk pathway of greatest concern to 
export with regard to European canker is symptomles s infection and infestation of fruit that cannot be 
detected by inspection. Under suitable conditions the fungus could develop to produce spores that 
transmit the disease."2912   
7.1210  With regard to the likelihood that N. galligena is present in the source orchards in 
New Zealand (importation step 1), the Panel has not ed the IRA's statement that the range estimated 
for this importation step takes into account the vari ations in climatic conditions across New Zealand, 
and the information indicating that about 95 per cen t of the apple export production in New Zealand 
comes from orchards in areas where the disease has e ither never been record ed or the disease occurs 
only sporadically in very wet seasons.2913 
7.1211  As to whether there is a likelihood that pick ed fruit is latently infested/infected with 
N. galligena (importation step 2), Dr Swinburne and Dr Lato rre explain that in principle it is possible 
                                                      
2908 See paras. 7.780-7.781. 
2909 See paras. 7.778-7.779 above. 
2910 See para. 7.1144 above. 
2911 Australia's IRA, Part B, p. 118. 
2912 Australia's IRA, Part B, p. 151. 
2913 See para. 7.520 above.  Australia's IRA, Part B, p. 121. WT/DS367/R 
Page 484  
 
 for infected fruit of all varieties to be harvested with no visible symptoms.
2914  Dr Latorre defines the 
occurrence of endophytically infected  mature apples as "a possibility ra ther than a real issue, which 
needs to be proven before admitting this as an important mechanism for long-distance dissemination 
of N. galligena ."2915  At the same time, Dr Latorre identifi es three cumulative factors that would be 
indispensable for apples to carry latent infections: 
"[T]hree key factors are necessary for the in fection of apple fr uit with European 
canker:  (i) conducive climatic conditions;  (ii) the presence of a susceptible host;  and (iii) sufficient inoculum concentration.  The co-occurrence of th ese three factors is 
necessary for fruit infection.  It has been demonstrated that humid (wet) conditions are necessary for inoculum production and libe ration.  Frequent rains are essential for 
conidia and ascospore dissemination from cankered lesions to fruits within infected 
trees.  Therefore, mature fruits would only carry latent infection in cool and rainy 
summer climates."
2916 
7.1212  The experts explain that it is highly unlikel y that these three factors would occur in 
New Zealand at the same time.  As regards Ne w Zealand's climatic conditions conducive to the 
infection of apple fruit with Neonectria galligena , the IRA refers to a study by Braithwaite: 
"In the higher rainfall areas of Auckland and the Waikato region, where European 
canker is present and climatic conditions are more conducive to spore production 
mainly due to wetter winters (NIWA, 2004), fruit could become infected during the harvest period. Fruit infected late in  the season, and showing no obvious rot 
symptoms, could be picked from these orchards. 
Braithwaite (1996), in a report to MA FNZ, acknowledged the possibility that 
European canker could go unnoticed at harvest or during the early part of storage, and 
therefore could be transmitted in fruit as latent infections."
2917 
7.1213  However, both Dr Swinburne and Dr Latorre criticize the IRA's reliance on this study.  
As Dr Swinburne explains: 
"Braithwaite (1996) contains an unc onfirmed report that fruit rotting with 
[Neonectria galligena ] has been detected in NZ, and it seems to be accepted by both 
parties that this does occur occasionally, although it is by no means clear if these 
reports refer to pre- or postharvest.  Braith waite then goes on to speculate that rotted 
fruit can transmit infection, basing his argument on European observations on the formation of ascospores on mummified fruit.  This is a very rare occurrence, and 
most unlikely to be found in the climates of NZ or Australia ... For  these reasons this 
aspect of the paper can be disregarded."
2918 
7.1214  Dr Latorre agrees that the Braithwaite study is not  a reliable basis for the IRA to conclude that 
latent infections may occur in mature apples in New Zealand: 
                                                      
2914 Dr Swinburne's and Dr Latorre's replies to Panel qu estion 49, in List of Replies from the scientific 
experts to questions posed by the Panel, paras. 310-314 and 306-309. 
2915 Dr Latorre's reply to Panel question 49, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 307. 
2916 Dr Latorre's reply to Panel question 56, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 351. 
2917 Australia's IRA, Part B, p. 122. 
2918 Dr Swinburne's reply to Panel questions 54 and 55, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 349.  WT/DS367/R 
 Page 485 
 
 
 "Braithwaite (1996) (Exhibit NZ-34) publis hed a brief review on the currently 
available knowledge regarding European ca nker, based on studies of the disease's 
development in the United Kingdom and Northern Europe, without examining conditions in New Zealand.  No new objec tive data is reported in this paper.  
Therefore, I agree that it is not a reli able and relevant re ference to support the 
hypothesis that latent infections may also  occur in mature apple in New Zealand."
2919 
7.1215  Dr Latorre adds that care should be exercised  when attempting to draw conclusions for 
New Zealand from the research conducted in  Europe and referenced by the IRA: 
"Australia's IRA based their risk assessm ent on the information already published 
from studies in Northern Ireland (Swinburne, 1964, 1975, Exhibits NZ-11 and NZ-9, 
respectively).  These results were obtaine d on apple varieties quite different from 
those produced today in New Zealand a nd under environmental conditions that 
appear to be far more conducive to fruit in fection (in Northern Ireland) than those in 
New Zealand.  Although this does not inva lidate the risk assessment analysis, and it 
does not reject the hypothesis that latent in fections may occur in mature fruits in 
New Zealand, it is a factor that should be ta ken into consideration by Australia's IRA.  
Latent infection on mature fruits should not be under discussion, but the probability 
of latent infection in many apple culti vars produced under different environmental 
conditions in New Zealand is of utmost interest."2920 
7.1216  Indeed, Dr Latorre is of the view that New Zealand's meteorological conditions are 
unfavourable for European canker development.   "[I]t appears that summer conditions in 
New Zealand are very unfavourable for the developmen t of European canker, and that fruit infection 
would be an extremely rare event.  Therefore, th e likelihood of latent infection on mature apple fruits 
would be extremely low or negligible."2921 
7.1217  Dr Swinburne concurs.  In his opinion, it is im portant to consider not only annual rainfall, but 
rainfall patterns, in order to determine whether th ere are sufficiently long periods of leaf wetness: 
"The essential weakness of the approach in the IRA is that it assumes that inoculum 
(spores) for infection is always available, and all that is required is a suitable period 
(hours of leaf wetness within given temper ature limits) for infection to occur.  
The major flaw in this argument is the assu mption that regions can be compared on 
the basis of annual rainfall, without regard to  rainfall patterns.  Even in regions such 
as N. Ireland (Loughgall) with rain in all seasons, more than 5hrs of leaf wetness was 
required following a few dry days before ascospore discharge resumed (Swinburne, 
1971b).  The situation in regions with a pronounced dry season, such as California 
and the Pacific Northwest in the USA, spore formation does not even begin until 
some time (as yet undetermined) into the ra iny period (Zeller, 1926, Wilson, 1966/8).  
For such an area data relating only to simple 'infection periods' would greatly 
overestimate the risk of disease establishment."2922 
                                                      
2919 Dr Latorre's reply to Panel question 54, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 344. 
2920 Dr Latorre's reply to Panel question 55, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 346. 
2921 Dr Latorre's reply to Panel question 57, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 358. 
2922 Dr Swinburne's reply to Panel question 66, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 399.  See also, Dr Swinburne's and Dr. Latorre's replies in Transcript of the 
Panel's meeting with experts, paras. 525-526. WT/DS367/R 
Page 486  
 
 7.1218  As regards the presence of a susceptible host,  Dr Swinburne notes that a fruit becomes 
infected if its own tree is infected.  He points out in this regard that the IRA acknowledges that 
95 per cent of New Zealand's orchards should be canker free: 
"[F]or fruit to become infected it generally requires to be grown on a tree which is 
itself infected..., so we are talking about fruit being infected from its mother tree, 
from its own particular tree.  So if you pick fruit from trees which have no canker, the 
likelihood of them having latent infection is vanishingly small.  And as I gather, 95 
per cent of New Zealand's orchards are largely canker free, from the exhibits presented."
2923 
7.1219  Dr Swinburne adds that, "[g]iven that some 95% of New Zealand orchards are either disease 
free or have very low levels of in fection, coupled with a climate that  is not well suited to summer fruit 
infection, it necessarily follows that the probabilit y of there being post harvest rots is very low 
indeed."2924 
7.1220  Likewise, Dr Latorre points out that "[l]atent infections may occur in a small proportion of 
the fruits harvested from cankered trees if frequent summer rainfalls occurred at harvest".  "[L]atent 
infections would be extremely unlikely in appl es from orchards free of European canker in the 
absence of summer rains.  Under these circumstances, the risk of latent infection is close to zero (in 
practice zero)."2925 
7.1221  As regards the way in which an mature, sympto mless apple fruit would become a true vector 
for European canker, Dr Swinburne notes that "fru it has to produce conidia in order to become an 
infectious unit."2926  Dr Latorre agrees, and explains that "conidia are only formed under very wet 
conditions in the orchard, mainly in  the cankers and almost never, or never at least in my experience, 
on the fruit".2927 
7.1222  Dr Swinburne adds that European canker needs an entry point in order to actually infect: 
"In the discussion concerning fire blight Erwinia , we were pointing out that Erwinia  
is not an epiphytic organism and neither is Cylindrocarpon heteronema, which is the 
asexual stage of Nectria .  The conidia are relatively short lived in any event, 
particularly in a dry climate, and they cannot survive on the unbroken surface of an apple.  They do require an entry point in order to infect.  Conidia merely contaminating the surface of fruit at harvest w ill not play a part in any future latent 
infection.  Those infections will alread y have taken place, as is known in the 
European context, either through the cal yx end, stem end or under very rare 
circumstances through open lenticels, becau se in very wet climates the lenticels on 
the fruit are actually open, enabling spores to enter."
2928 
7.1223  Dr Latorre agrees with Dr Swinburne that coni dia can survive only for a short period of time 
on the surface of apple fruit: 
                                                      
2923 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 432. 
2924 Dr Swinburne's reply to Panel questions 62 and 63, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 388. 
2925 Dr Latorre's reply to Panel guideline (g), in List of Replies from the scientific experts to questions 
posed by the Panel, para. 2.  See also, Dr Latorre's reply to Panel question 49, in List of Replies from the 
scientific experts to questions posed by the Panel, para. 306. 
2926 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 419. 
2927 Dr Latorre's reply in Transcript of the Panel's meeting with experts, para. 413. 
2928 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 434.  WT/DS367/R 
 Page 487 
 
 
 "[O]n my experience conidia cannot multiply on the surface of the fruit, and they can 
only survive maybe for a very short period of time, depending on weather conditions 
of the environment where they are. ...  Th ere is no data showing that conidia can 
really survive for a long period of time outside the host, on the surface of the host, in this case on the fruit, nor that th ey can multiply on clean fruit."
2929 
7.1224  The Panel has already noted that Europ ean canker would not survive as a surface 
contaminant.2930  As explained by Dr Latorre, "[t]here is  no information demonstrating that conidia or 
ascospores of N. galligena  can survive epiphytical ly (as surface contaminant) on mature apple 
fruits."2931  Likewise, the survival and viability of th e fungus would require sp ecific climatological 
conditions.  The Panel has noted, with  regard to the IRA's discussion of importation steps 2 and 3, that 
certain meteorological conditions are necessary for inoculum production, dissemination and 
infection.2932  Dr Latorre explains that "favourable clim atic conditions are compulsory for sporulation 
(inoculum production, mainly conidia), disse mination and survival of the inoculum."2933 
7.1225  Furthermore, Dr Swinburne explains that the presence of lesions cannot predict the likelihood 
of fruit infection: 
"The sequence of events outlined above are applicable to regions where wood cankers 
are frequent and weather c onditions favour production of  conidia during the summer 
months (e.g. the U.K., and N. Ireland in particular).  The presence of stem lesions alone can not predict the likelihood of fruit infec tion.  It is unfortunate that there is so 
little data on the causes and extent of rotting of fruit in New Zealand, but what there 
is suggests that summer weather conditions are not favourable for infections by 
N. galligena and the challenged requirements seem excessive (see Q72)."
2934 
7.1226  Dr Swinburne also points out that in New Zealand fruit rots attributable to N. galligena  
should not be common: 
"The limited information available in [the Parties first written submission] suggests 
that rots attributable to N. galligena  in fruit grown in New Zealand are by no means 
as common as they are in Europe, and (of course) are seemingly confined to regions 
of [New Zealand] where tree cankers are present.  The weather data presented in Annex 2 of [New Zealand's first writte n submission] would accord with a low 
incidence of fruit infection, and, based on Wilson's (1966) observations in California, 
even conidial production from stem cankers  may be sparse duri ng summer.  It is 
perhaps significant that in what was descri bed as an epidemic of canker in Auckland 
that Brooke & Bailey (1965) only found o ccasional fruit rots.  Unfortunately that 
paper does not record whether the rots  were found before or after harvest."
2935 
                                                      
2929 Dr Latorre's reply in Transcript of the Panel's meeting with experts, para. 435. 
2930 See, for example, paras. 7.682, 7.702 and 7.715 above. 
2931 Dr Latorre's reply to Panel question 49, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 308. 
2932 See paras. 7.531-7.534 and 7.564-7.566 above. 
2933 Dr Latorre's reply to Panel question 66, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 398. 
2934 Dr Swinburne's reply to Panel question 49, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 314. 
2935 Dr Swinburne's reply to Panel question 57, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 361.  See, Wilson, "Development of European canker in a California apple 
district" (1966), in Exhibit NZ-64. WT/DS367/R 
Page 488  
 
 7.1227  Dr Swinburne emphasises the importance of adequa te climatic conditions for fruit rots.  "Both 
parties seem to agree that the frequency of fru it rotting is low, given the paucity of positive 
identifications.  That this is so, even from regions with tree cankers (e.g. Auckland) this [sic] must be 
attributable to unfavourable weather conditions, especially the absence of rain, during the summer 
months."
2936 
7.1228  The Panel has noted that the IRA does not contain scientific evidence regarding the 
possibility that latently infected but symp tomless fruit could deve lop rot and generate Neonectria 
galligena  spores, which could then be transferred to clean  fruit.  The Panel has concluded that there is 
no scientific evidence in the IRA to support the pro position that perithecia would play a role in the 
contamination of clean fruit.2937 
7.1229  Dr Swinburne explains that, in any event, most fruit infections would not occur at harvest: 
"The majority of fruit infections in the European context are to be found either at the 
stem end or the calyx end, and generally speaking it means that the core has been 
infected.  The time at which that infecti on occurs [would be] surprisingly early on in 
the fruits development.  It isn't at the time of harvest, it isn't in the dump tank.  That 
core rot is taking place at some stage when either the calyx or the stem end is 
enabling an entry point for conidia whic h are washing down over the surface of the 
tree and either accumulating it in the stem well or going around and entering the calyx.  I don't have any information which would ever suggest that infestation of apples at harvest, and I stress that point, or even after harvest leads to any significant 
level of rotting in commercial conditions."
2938 
7.1230  Dr Swinburne adds that it would seem "extraordi nary, if true" that a high proportion of apples 
rotted with N. galligena  would go unnoticed by research centres in New Zealand and that 
"[a]lternatively, the arbitrary probability maximum set in the IRA is too high."2939 
7.1231  As regards survival of European canker after cold storage, Dr Latorre points out that the 
evidence in the IRA suggests that in  principle the fungus may survive even after cold storage, but only 
inside apple fruit.  "Australia states that cool storage and transport processes would not adversely 
affect the viability of the fungus.  This may be tr ue only for the fungus inside the fruit ... In other 
words, mycelia can survive in late ntly infected fruits;  growth may resume after cool storage and 
eventually the fungus may sporulate on the surface of mummified fruits."2940 
7.1232  Dr Latorre adds that "[f]requent summer ra infalls are necessary for inoculum production, 
dissemination and infection.  If summer rainfalls ar e frequent, it would be reasonable to assume that 
some of the infected fruits may develop symptoms  on the tree, and other fruits may be latently 
infected, developing symptoms after several weeks or even months in cold storage."2941 
                                                      
2936 Dr Swinburne's reply to Panel question 75, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 438. 
2937 See, for example, para. 7.572 above. 
2938 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 441. 
2939 Dr Swinburne's reply to Panel question 75, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 439.  See also, Dr Deckers's reply to Panel question 75, in List of Replies 
from the scientific experts to questions posed by the Panel, para. 436. 
2940 Dr Latorre's reply to Panel question 71, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 413. 
2941 Dr Latorre's reply to Panel question 57, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 357.  See also, Dr Latorre's reply to Panel question 66, in List of Replies from the 
scientific experts to questions posed by the Panel, para. 398.  WT/DS367/R 
 Page 489 
 
 
 7.1233  Both Dr Latorre and Dr Swinburne explain that there is no evidence of perithecia forming on 
rotten fruit.  As explained by Dr Latorre: 
"I have no information indicating that Eur opean canker can develop from rotten fruit.  
In my experience, rotten fruit is very rare, almost never occurs in our conditions and 
sometimes we do see it after several months or weeks of cold storage in a very low 
proportion and never sporulated on the surface of the fruit.  If this fruit are not 
sporulating it is impossible to admit that it can  spread at least easily to the clean fruit.  
Well, I think the observation about perithecia on the fruit is something that has to be reviewed.  We have never seen perithecia  form on the fruit.  I don't have any good 
paper that can really demonstrate that in the recent years they have seen perithecia in 
very susceptible varieties, but not in today's apple varieties."
2942 
7.1234  As regards the likelihood that N. galligena survives routine processing procedures in the 
packing house (importation step 4), the experts ag ree in principle with the IRA's proposition that: 
"[N]o aspect of the process in the pack ing house reduces the number of latently 
infected fruits.  Once the fungus has penetr ated mature fruits, the normal post-harvest 
management including brushing, waxing, sorting and grading, cold storage and even 
fungicide treatments, will be unable to a rrest the fungus inside the fruits.  Cold 
temperature would only be able to retard symptom development by lowering the rate of fungal growth."
2943 
7.1235  In particular, according to Dr Latorre, cold storage, for example, would "retard symptom 
development by lowering the rate of fungal  growth", but would not reduce infections.2944  At the same 
time, Dr Latorre agrees with New Zealand that the use of water dump tanks, followed by high-
volume, high-pressure water washing, would be effective in removing external contaminants.2945  This 
is also noted by the IRA.2946  In the words of the expert, "[t]he likelihood that inocula contaminating 
the surface of the fruits can survive this process, attached to the fruit surface, is negligible or zero and 
it should be disregarded from the risk analysis."2947 
7.1236  Nevertheless, Dr Latorre and Dr Swinburne cauti on that the IRA fails to take into account the 
effect of store conditions and the duration of  storage.  Dr Swinburne explains that: 
"It is usual for dessert apples to be harveste d into bulk bins that are transported to on-
site CA (controlled atmosphere) stores, where they are cooled, and sealed in chambers with adjusted CO2 and O2 con centrations.  At intervals dictated by 
marketing strategies they are removed from these stores and dispatched to specialist 
                                                     
 
2942 Dr Latorre's reply in Transcript of the Panel's meeting with experts, para. 413.  See also, 
Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 461. 
2943 Dr Latorre's reply to Panel question 79, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 454.  See also, reply of Dr Sw inburne to Panel questions 77, 78 and 79, para. 459;  and 
Dr Deckers's reply to Panel question 79, in List of Replies from the scientific experts to questions posed by the 
Panel, para. 453. 
2944 Dr Latorre's reply to Panel question 79, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 454. 
2945 Dr Latorre's reply to Panel question 79, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 456.  See also, Dr Sgrillo's reply to Panel question 80, in List of Replies from the scientific experts to questions posed by the Panel, para. 465. 
2946 Australia's IRA, Part B, p. 125. 
2947 Dr Latorre's reply to Panel question 79, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 456.  See also, Dr Swinburne's reply to Panel questions 77, 78 and 79, in List of 
Replies from the scientific experts to questions posed by the Panel, para. 459. WT/DS367/R 
Page 490  
 
 pack houses, where the operations of wash ing, grading and packed for retail.  
The process may extend over many months, wh ich has not been factored into the IRA 
model.  Any infections present may develop in to rots during this time, and this will be 
strongly influenced by both the store temperature and environment (Berrie et al 2007, appendix 1).  At grading these would be removed, so the numbers of infected fruit 
will diminish with time, consequently th e statement that 'none of the pack house 
measures would reduce infection' is incorr ect, as it must also embrace the CA store 
period."
2948 
7.1237  In the words of Dr Swinburne, "[t]he probabiliti es assigned in the IRA to these steps are all 
difficult to reconcile with the observations above, es pecially as they all omit the factor of time."2949  
Dr Swinburne concludes that "the store conditions  and the duration of the holding period will be a 
factor in any subsequent development of any quiescen t infections that may be present (Berrie, Xu & 
Johnson 2007 in appendix)."2950  Likewise, Dr Latorre notes that "symptoms may appear after several 
weeks of cold storage.  If lots of mature asymptoma tic fruits are kept for sever al weeks in cold storage 
in New Zealand, it would be possible to remove in fected fruits before export to Australia, lowering 
the risk of entrance."2951 
7.1238  Furthermore, Dr Latorre and Dr Swinburne fi nd no justification in the IRA for the likelihood 
values assigned to importation step 4.  Dr Latorre states that "[t]here is no scientific literature to 
support" the likelihood values estimated by the IRA for importation step 4.2952  This likelihood "falls 
within a range that is difficult to legitimize, if th is assumption implies that the inoculum must remain 
on the fruit surface.  Rather, it would be possible fo r the inoculum to be present internally in the 
fruit."2953 
7.1239  As regards the probability of European canker entering Australia, Dr Latorre confirms that 
specific climatic conditions and the prevalence of infected trees are essential factors for European 
canker infections in new areas:  
"Latent infections may occur in a small proportion of the fruits harvested from 
cankered trees if frequent summer rainfalls o ccurred at harvest.  Fruit infections are 
negligible or extremely low in areas with dry climate conditions at harvest.  If cankered trees are not prevalent (0% infected trees), I would not expect to observe any latent infections, even under high summer rainfalls.  Therefore, the risk of 
                                                     
 
2948 Dr Swinburne's reply to Panel questions 78, 80, 81, 82 and 83, in List of Replies from the scientific 
experts to questions posed by the Panel, para. 482.  See also, Dr Swinburne's reply to Panel questions 77, 78 and 
79, in List of Replies from the scientific expe rts to questions posed by the Panel, para. 459. 
2949 Dr Swinburne's reply to Panel questions 77, 78 and 79, in List of Replies from the scientific experts 
to questions posed by the Panel, para. 460. 
2950 Dr Swinburne's reply to Panel questions 77, 78 and 79, in List of Replies from the scientific experts 
to questions posed by the Panel, para. 459.  See also, Dr Deckers's reply to Panel question 80, in List of Replies 
from the scientific experts to questions posed by the Panel, para. 461. 
2951 Dr Latorre's reply to Panel question 79, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 455.  See also, Dr Deckers's reply to Panel question 79, in List of Replies from the 
scientific experts to questions posed by the Panel, para. 453. 
2952 Dr Latorre's reply to Panel question 80, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 462.  See also, Dr Sgrillo's reply to Panel question 80, in List of Replies from the 
scientific experts to questions posed by the Panel, para. 467. 
2953 Dr Latorre's reply to Panel question 80, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 462.  WT/DS367/R 
 Page 491 
 
 
 entrance would vary considerably based on climate conditions and disease prevalence 
and severity."2954 
7.1240  Dr Latorre explains that "temperatures a nd rainfalls are relatively unfavourable for 
N. galligena  during summer and early fall in Australia, which may be the most critical period for 
infection."2955 
7.1241  Likewise, Dr Swinburne notes that even if a New Zealand apple was infected, it would not 
necessarily be capable of initiating a new series of European canker infections in Australia: 
"The production of conidia from an apple rotted with Nectria  discarded in an 
Australian orchard and thinking in terms of  its ability to initiate a new series of 
infections in an area which had never had it.   As I have said, there is no information 
concerning the possibility that that would happen.  The point that I want to emphasize 
is that fruit has to produce conidia in order to  become an infectious unit.  It may be 
infected, but it is not necessarily infectious and even if it does become infectious, 
being presumably on the ground and not deliberately placed somewhere up in a tree, the dissemination of those conidia which depends on splash dispersal is actually 
going to be over a very limited area but I wouldn't want to overemphasize that 
particular possibility but there is no inform ation which tells us that it cannot happen 
and as biologists one can never say it would never happen."
2956 
7.1242  While Dr Latorre accepts the IRA's conclusion in  regard to European canker development in 
Australia, he notes that the values relied upon by th e IRA have not been validated locally and seem 
exaggerated: 
"The available information demonstrating that mature asymptomatic apples (infected 
or latently infected) can readily sporulate under the Australian environment is not provided.  Based on published scientific information, Australia assumes that fungal growth and fruit rot resume when fruit is  removed from cool storage, sold to 
consumers and stored at room temperature.  Therefore, rotted fruits discarded near 
susceptible hosts could be potentially (but  not necessarily) a source of inoculum 
(mainly conidia) for infections in new areas.  This conclusion is acceptable and 
likelihood values for establishment and sp read in Australia have been assigned 
(Table 34, AUS-2BA p.144).  However, th e likelihood assigned seems to be high and 
these values have not been validated locally.  Based on the general information available, I would assume that these events  have a likelihood of occurring different 
from zero, but still extremely low."
2957 
7.1243  Further, Dr Swinburne is sceptical about the risk  presented in retail packs or in a domestic 
environment: 
"As discussed in Q58 rotted fruit incuba ted under conditions of high humidity can 
produce conidia, but it is extremely unlikely that they would produce perithecia, still 
less that ascospores would be released.  The importance of high humidity to conidia 
                                                      
2954 Dr Latorre's reply to Panel question 49, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 306.  See also, Dr Latorre's reply to Panel question 56, in List of Replies from the 
scientific experts to questions posed by the Panel, paras. 351-352. 
2955 Dr Latorre's reply to Panel question 66, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 398. 
2956 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 419. 
2957 Dr Latorre's reply to Panel question 69, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 407. WT/DS367/R 
Page 492  
 
 production has to be stressed.  The surface of fruit held in cold stores is usually moist, 
and fully developed rots usually  produce conidia.  Fruits rotting subsequently in retail 
packs or in a domestic environment at less than 100% RH are not likely to produce conidia.  In the uncertain event that an apple shipped to Australia from New Zealand 
rotted with N. galligena  its ability to act as vector of disease would depend on the 
handling system on arrival. (See Q52)"
2958 
7.1244  When asked specifically whether restricting imports to mature, symptomless apples would 
achieve Australia's ALOP , Dr Latorre responds that under New Zealand's alternative, apples may 
carry Neonectria galligena ;  the likelihood of this is "close but not equal to zero": 
"Exporting only 'mature asymptomatic apples' from New Zealand would disregard the 
fact that latent infection may occur on a ma ture apple fruit, the main issue of this 
dispute.  Latent infection (fruits that are infected but asymptomatic at harvest) may be extremely rare in New Zealand, considering that weather conditions at harvest are not 
very favourable for European canker in  New Zealand apple-producing areas, as 
previously discussed.  However, it has to be admitted that the likelihood of such an 
occurrence is close but not equal to zer o; at least, until objective results prove 
otherwise."
2959 
7.1245  Likewise, Dr Swinburne notes that New Zealand's alternative measure would involve a very 
low level of transmission: 
"Given that some 95% of New Zealand orchards are either disease free or have very 
low levels of infection, coupled with a cl imate that is not well suited to summer fruit 
infection, it necessarily follows that the pr obability of there being post harvest rots is 
very low indeed.  Exclusion of exports from the remaining 5% of orchards would reduce the risk to insignificance. 
Australia's insistence on receiving only fruit from inspected orchards certified as free 
from canker would eliminate virtually all risk  of fruit being infected.  Moreover, as 
there is no evidence to support Australia's concerns that cross contamination might 
occur in the pack house during grading etc. no further measures would be necessary."
2960 
7.1246  Referencing the experience of other apple expor ting countries, Dr Latorre points out that the 
IRA's conclusion that symptomless apples from New Ze aland would carry latent  infections is not 
supported by scientific information: 
"The [pest risk analysis], and particularly the ALOP, is the crucial aspect of this 
dispute with regard to European canker.  Au stralia considers [the probability of entry, 
establishment and spread as] low.  However,  there is a general perception that [the 
probability of entry, establishment and spread] is extremely low or negligible in other apple-producing countries.  Data provided by Australia to support their conclusion 
appear to be insuffici ent.  For instance, data to validate the probability of 
                                                     
 
2958 Dr Swinburne's reply to Panel question 69, in List of Replies from the scientific experts to 
questions posed by the Panel, para. 408. 
2959 Dr Latorre's reply to Panel question 63, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 386. 
2960 Dr Swinburne's reply to Panel question 63, in List of Replies from the scientific experts to 
questions posed by the Panel, paras. 388-389.  WT/DS367/R 
 Page 493 
 
 
 N. galligena entrance via asymptomatic fruits  has not been provided;  similarly, data 
supporting the probability of establis hment and spread were not presented.  
The long experience of other exporting c ountries where European canker is present 
(e.g., Chile, United States) suggests that the probability that asymptomatic fruits 
carrying latent infection may introduce N. galligena  into a new area is negligible 
(extremely rare), rather than low.  This  probability would increase if apples were 
harvested from infected orchards located  in areas with high summer rainfalls.  
Therefore, the risk of long-distance disease spread by infected fruits (fruits with latent 
infection or visible symptoms of the disease) should be considered extremely low or negligible until sufficient experimental evidence is provided to neglect this 
conclusion."
2961 
7.1247  When meeting with the Panel, the experts we re more doubtful about whether New Zealand's 
alternative would achieve Australia's ALOP.  Dr Swinburne stated that: 
"The assumption behind this particular measure is that fruit which become infected 
during the growing season will all show sympto ms of rotting, at or before they are 
mature harvestable fruit, because of the natu re of the varieties.  And the point that 
was made in some of the presentations was that the resistance mechanism, which is 
expressed by cooking apples which restricts the fungus for some period of time, 
wasn't present in modern dessert varieties.  That is not the European experience.  
In Europe, and particularly in United Kingdom, we know that fruit of the same sort of varieties as we are discussing here, can a nd do become infected during the growing 
season are harvested at the appropriate moment but still symptomless and are then 
placed in store, and this is the important thing is what happens to them in store, because the conditions the gas and temperat ure conditions within those stores is 
critical to the development of subsequent ro tting, but they can therefore develop rots 
some weeks perhaps months after they have  been picked in a mature symptomless 
condition.  So it is incorrect to assume that  that particular measure would satisfy the 
requirement."
2962 
7.1248  Dr Latorre agreed:  "I agree with Dr Swinburne has mentioned [sic].  Since it is impossible to 
differentiate symptomless fruit from those having the in ternal infection, I think this measure would be 
very difficult to satisfy the requirement, in my opinion."2963 
7.1249  As noted above in regard to fire blight2964, what the Panel has to look at, in the context of the 
second prong of Article 5.6 of the SPS Agreement, is  whether New Zealand has raised a presumption, 
not successfully rebutted by Australia, that the alte rnative measures would achieve Australia's ALOP.   
As the panel in Australia – Salmon  explained2965, this legal analysis is different from the scientific 
assessment and certainty that scientific experts consulted by panels might prefer. 
7.1250  The Panel accepts that it might be impossible to differentiate symptomless fruit from fruit 
having latent internal infection.  However, th e distinction between mature, symptomless fruit and 
latently infected fruit is not the key issue here.  The key issue is the probability of New Zealand 
apples successfully initiating a European canker infe ction in Australia.  Significantly, Dr Latorre and 
                                                      
2961 Dr Latorre's reply to Panel question 51, in List of Replies from the scientific experts to questions 
posed by the Panel, paras. 323-324 (emphasis added). 
2962 Dr Swinburne's reply in Transcript of the Panel's meeting with experts, para. 426. 
2963 Dr Latorre's reply in Transcript of the Panel's meeting with experts, para. 427. 
2964 See para. 7.1137 above. 
2965 Panel Report on Australia – Salmon , para. 8.126 (emphasis added). WT/DS367/R 
Page 494  
 
 Dr Swinburne clearly state – and the Panel has f ound under Articles 5.1 and 5.2 – that the IRA's risk 
assessment is flawed at various key points co ncerning the probability that latently infected 
New Zealand apples would actually carry Neonectria galligena.   In particular, Dr Latorre and 
Dr Swinburne explain that it would be highly unlikel y that latently infected apples would appear in 
New Zealand and be harvested in the first place.  They are also sceptical ab out the survival of the 
N. galligena for a sufficiently long time on th e surface of apple fruit.  Further, they question the 
possibility of latently infected New Zealand apples initiating a European canker infection in Australia. 
7.1251  As also noted in the context of fire blight, the experts confirm that New Zealand would only 
export to Australia mature, symptomless apples that would also be free of trash.
2966  Further, the Panel 
has found under Articles 5.1 and 5.2 of the SPS Agre ement that the choice of a probability interval 
and a midpoint for events with a "negligible" like lihood of occurring, as well as the combination of 
this probability interval with the use of a uniform  distribution to model the likelihood of these events, 
are not properly justified in the IRA and lead to  an overestimation of the probability of entry, 
establishment and spread of European canker.2967 
7.1252  Australia has a qualitative ALOP, defined as "pr oviding a high level of protection aimed at 
reducing risk to a very low level, but not to zero."2968  In the light of the above considerations, the 
Panel finds that New Zealand has raised a su fficiently convincing presumption, not successfully 
rebutted by Australia, that the alternative European canker measure of restricting imports of New Zealand apples to mature, symptomless apples would meet this ALOP.  Accordingly, this 
alternative measure fulfils the se cond condition of the Article 5.6 t est in the context of European 
canker, too. 
(ii) First condition:  whether restricting imports to mature, symptomless apples is reasonably 
available taking into account t echnical and economic feasibility 
7.1253  New Zealand claims that restricting imports to apple fruit that are mature and symptomless 
instead of the 12 measures at issue for fire blight  and European canker is reasonably available taking 
into account technical and economic feasibility.
2969  New Zealand explains that "international fruit 
buyers" require New Zealand apples to meet the minimum standard set out as the Pipfruit 
New Zealand Class 1 export fruit standard.  This  standard requires apples to be mature and 
symptomless2970, and New Zealand's pipfruit industry h as pre- and post-harvest quality control 
measures to ensure that the apples to be exporte d meet the Pipfruit New Zealand Class 1 export fruit 
standard for fruit maturity.2971  Thus, the requirement for apples to  be mature and symptomless would 
only make New Zealand's current practice mandatory.2972  New Zealand quotes the experts' responses 
to confirm that compliance with such standards would ensure that only mature and symptomless 
apples will be exported to Australia.2973  New Zealand also refers to the Japan – Apples (Article 21.5 – 
US) dispute where the compliance panel found that an alternative measure requiring apples to be 
mature and symptomless was reasonably availa ble taking into account technical and economic 
                                                      
2966 See para. 7.1195 above. 
2967 See paras. 7.780, 7.781 and 7.1205 above. 
2968 Australia's IRA, Part A, p. 3. 
2969 New Zealand's first written submission, para. 4. 497.  See also, New Z ealand's second written 
submission, para. 2.889. 
2970 New Zealand's first writte n submission, para. 4.492. 
2971 New Zealand's first writte n submission, para. 4.493. 
2972 New Zealand's first written subm ission, para. 4.495.  See also New Zealand's second written 
submission, para. 2.888. 
2973 New Zealand's second writte n submission, para. 2.888.  WT/DS367/R 
 Page 495 
 
 
 feasibility.2974  New Zealand submits that Australia does not contest that the alternative fire blight and 
European canker measure is reasonably available.2975 
7.1254  Australia does not directly contest that New Zealand's alternative is reasonably available 
taking into account technical and economic feasibility.  Australia refers to the Japan – Apples  
(Article 21.5 – US)  dispute and argues that an alternative measu re is reasonably available if it could be 
reasonably implemented "in practice" taking into account technical and economic feasibility "in the 
real world".  Australia also submits that the risk of the "incorrect enforcement" of an alternative 
measure is part of its technical feasibility.2976 
7.1255  The Panel considers that New Zealand has demonstrated that the requirement for apples to be 
mature and symptomless is part of its current apple production and export practice.  In fact, the 
requirement for apples to be mature and symptomless is part of the Pipfruit New Zealand, Class 1 
export standard, which New Zealand submitted to the Panel.2977  Accordingly, New Zealand has 
demonstrated that it has quality control measures in place to ensure that the mature, symptomless 
requirement is respected. 
7.1256  As noted above, Dr Deckers describes the Pip fruit New Zealand, Class 1 export fruit standard 
as "a standard method of maturity  and fruit quality determination."2978  Likewise, Dr Paulin confirms 
that the Pipfruit New Zealand, Class 1 export fruit  standard corresponds to a "high standard of 
quality" and "[t]he specifications for absence of dama ge are of a proper level of precision to guarantee 
'symptomless fruits'".2979  Dr Latorre finds that "the require ments established by Pipfruit New Zealand 
with regard to maturity and absence of fruit damage are acceptable."2980  He also confirms that in light 
of the exhibit submitted by New Zealand there is no risk that apples exported from New Zealand "will 
not always be mature, asymptomatic and free of trash".2981  Likewise, according to Dr Schrader: 
"With regard to the requirements for maturity, the inclusion of background colour and 
ethylene content as established by Pipfruit New Zealand goes beyond the 
requirements asked by the Streifindex.  Regarding absence of damage, class 1 as defined in Exhibit NZ-93 is more detailed than e.g. quality standards required by the 
European Union, where trade class 1 refers to good quality, slight shape and 
development defects, slight colouring de fects, only slightest bruises, sufficient 
firmness."
2982 
7.1257  The Panel agrees with Australia that whether an alternative is considered reasonably available 
taking into account technical and economic feasibility must be assessed "in the real world" as suggested by the compliance panel in Japan – Apples (Article 21.5 – US) .  As stated in the same 
dispute, the "risk of incorrect enforcement" is  also part of the technical feasibility of the 
                                                     
 
2974 New Zealand's first writte n submission, para. 4.496. 
2975 New Zealand's second writte n submission, para. 2.886. 
2976 Australia's first written submission, para. 1077. 
2977 Pipfruit New Zealand Incorporated, "Best Practices Guidelines for Production, Harvest, Cool-chain 
and Packing of NZ pipfruit:  Industry Quality Recommendations" (January 2005), in Exhibit NZ-93. 
2978 See para. 7.1195 above.  Dr Deckers's reply to Panel question 2, in List of Replies from the 
scientific experts to questions posed by the Panel, para. 20. 
2979 See para. 7.1195 above.  Dr Paulin's reply to Pane l question 2, in List of Replies from the scientific 
experts to questions posed by the Panel, para. 22. 
2980 See para. 7.1195 above.  Dr Latorre's reply to Panel question 2, in List of Replies from the 
scientific experts to questions posed by the Panel, para. 21. 
2981 See para. 7.1195 above.  Dr Latorre's reply to Panel question 3, in List of Replies from the 
scientific experts to questions posed by the Panel, para. 29. 
2982 See para. 7.1195 above.  Dr Schrader's reply to Panel question 2, in List of Replies from the 
scientific experts to questions posed by the Panel, para. 23. WT/DS367/R 
Page 496  
 
 alternative.
2983  Nonetheless, Australia failed to explain how these two parameters apply in the current 
dispute to refute the prima facie  case made by New Zealand that the first condition of the Article 5.6 
test is fulfilled in the context of fire blight a nd European canker.  In fact, Australia did not even 
contest New Zealand's specific arguments in regard to fire blight and European canker under the first 
condition of the Article 5.6 test. 
7.1258  In light of its aforementioned arguments and these responses by the experts, New Zealand has 
made a prima facie  case that the first condition of the Article 5. 6 test is fulfilled in the context of fire 
blight and European canker, which Australia has failed to rebut. 
(iii) Third condition:  whether restricting imports to mature, symptomless apples is significantly 
less trade restrictive than Australia's curren t fire blight and European canker measures 
7.1259  New Zealand argues that its alternative would be  significantly less trade restrictive than the 
eight measures in place for fire blight and that it already has procedures in place to ensure that it 
would export only mature, symptomless apples to Australia.  The additional costs for the implementation of the alternative measure would be  limited to merely validating this procedure.
2984  
The alternative measure that simply validates, th rough auditing, existing arrangements for the export 
of apples is less trade restrictive than measures imposing multiple new requirements.2985 
7.1260  New Zealand claims that Australia's contested  fire blight and European canker measures 
introduce a high degree of risk for any New Zeala nd apple grower since a single fire blight or 
European canker strike would make the appl es from that orchard ineligible for export.2986  This would 
not happen under the alternative proposed by New Zealand.2987  Also, orchards without any history of 
fire blight and European canker would still have to  comply with Australia's existing requirements, 
whereas New Zealand's alternative would not impose such compliance.2988  The potential reduction of 
costs of the alternative measure would promote the competitiveness of New Zealand apple growers, in 
contrast to Australia's existing requireme nts that impose increased compliance costs.2989  New Zealand 
also contends that Australia does not contest that the alternative measure is "significantly less trade 
restrictive".2990 
7.1261  Australia indicates that a WTO Member does not need to adopt the least trade-restrictive 
measure.2991  When comparing the trade restrictivene ss between the existing and the alternative 
measure, it is not enough to establish that the alterna tive is merely less trade restrictive;  rather, the 
alternative must be significantly less trade restri ctive, "significant" meaning "important, notable, 
consequential".2992  Australia's understanding of the panel report in  EC – Approval and Marketing of 
Biotech Products is that a given risk assessment may be supported by a range of possible measures 
and it is within the Member's discretion to choose a measure providing the best protection taking into 
account its ALOP.2993  Accordingly, Australia submits that th e Panel must respect "a Member's right 
                                                      
2983 Panel Report on Japan – Apples (Article 21.5 – US) , para. 8.171. 
2984 New Zealand's first writte n submission, para. 4.505. 
2985 New Zealand's first writte n submission, para. 4.506. 
2986 New Zealand's first writte n submission, para. 4.507. 
2987 New Zealand's first writte n submission, para. 4.508. 
2988 New Zealand's first writte n submission, para. 4.509. 
2989 New Zealand's first writte n submission, para. 4.510. 
2990 New Zealand's second writte n submission, para. 2.886. 
2991 Australia's first written submission, para. 1078. 
2992 Australia's first written submission, para. 1079. 
2993 Australia's first written submission, para. 1080.  WT/DS367/R 
 Page 497 
 
 
 to choose its preferred measure, unless there is another measure that is significantly less restrictive to 
trade".2994 
7.1262  Previous panels assessed the third condition of th e Article 5.6 test by looking at the difference 
in market access under the measures at issue and the alternative measure(s) identified by the 
complainant.  In particular, previous panels analysed whether, under th e alternative measure, 
"market access would be obtained significantly more easily than under the current regime"2995 and 
whether "the increased market access that would result under the alternative[] ... would be 
significant."2996 At least two fire blight measures (M4 and M5) and one European canker measure 
(M13) have a direct effect on market access, and thus trade, in that they involve a suspension of trade 
in case of non-compliance. 
7.1263  A comparison of New Zealand's alternative me asure with the 12 contested fire blight and 
European canker measures also confir ms that the former would be signi ficantly less trade restrictive.  
In fact, Australia's contested fire blight measure s are not just more numerous, they are also more 
stringent and costly to comply with.  In contrast, through its Class 1 export fruit standard, New Zealand already complies with the alternative requirement of restricting the import of 
New Zealand apples to mature, symptomless apples. 
7.1264  The Panel agrees with Australia that the third cond ition of the Article 5.6 test requires that the 
complainant identify an alte rnative measure that is " significantly  less restrictive to trade" than the 
contested measure.  This is in line with the language of footnote 3 to Article 5.6 of the 
SPS Agreement
2997, and it also accords with how previous  panels and the Appellate Body have 
identified this third condition.2998  Nonetheless, Australia does not explain why New Zealand's 
alternative measure for fire bli ght and European canker would be merely less trade restrictive.  
Nor does Australia contest any of the specific argumen ts advanced by New Zealand in the context of 
fire blight and European canker in regard to  the third condition of the Article 5.6 test. 
7.1265  Accordingly, the Panel finds that New Zealand h as demonstrated that a measure requiring that 
imports of New Zealand apples be mature and sympto mless is significantly less trade restrictive than 
Australia's contested fire blight and European canker measures. 
(c) Conclusion on New Zealand's Article 5.6 claim with  regard to fire blight and European canker 
7.1266  The Panel has found that New Zealand has demonstr ated that its alternative measure for fire 
blight and European canker fulfils the three cu mulative conditions of the Article 5.6 test.  
Accordingly, the Panel finds that the fire b light and European canker measures contested by 
New Zealand (Measures 1-11 and 13) are inconsiste nt with Article 5.6 of the SPS Agreement. 
                                                      
2994 Australia's first written submission, para. 1081. 
2995 Panel Report on Japan – Agricultural Products II , para. 8.96. 
2996 Panel Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.151. 
2997 Footnote 3 to Article 5.6 of the SPS Agreement provides that "[f]or the purposes of paragraph 6 of 
Article 5, a measure is not more trade-restrictive than  required unless there is another measure, reasonably 
available taking into account technical and economic feasibility, that achieves the appropriate level of sanitary 
or phytosanitary protection and is significantly  less restrictive to trade." (emphasis added). 
2998 See, Appellate Body Report on Australia – Salmon , paras. 186 and 194;  Panel Report on Japan – 
Agricultural Products II , para. 8.72;  and Appellate Body Report on Japan – Agricultural Products II , para. 95. WT/DS367/R 
Page 498  
 
 3. Measure regarding ALCM 
(a) Alternative measure regarding ALCM identified by New Zealand 
7.1267  New Zealand claims that Australia's measure regarding ALCM listed in the panel request 
(Measure 14)
2999 is inconsistent with Australia's obligations under Article 5.6 of the 
SPS Agreement3000  because requiring inspection of a 600-fruit sample of each import lot is an 
alternative measure satisfying all three cumulative conditions of the Article 5.6 test.  "A single 
measure could have been imposed by Australia in respect of ALCM that would be consistent with 
standard AQIS inspection procedures for detection of  quarantine pests.  This single measure is the 
inspection of a 600 fruit sample from each import lot."3001 
7.1268  Australia argues that this is the only alterna tive measure identified by New Zealand regarding 
ALCM.3002  New Zealand, however, contends that it has also identified the retail-ready requirement as 
a further alternative measure regarding ALCM th at would satisfy the three-pronged Article 5.6 
test.3003 
7.1269  New Zealand refers to the retail-ready requirement  as an alternative measure for the first time 
in its first written submission, but only in the context of fire blight: 
"With regard to fire blight, alternativ e measures that would also be reasonably 
available, be less trade restrictive and achieve Australia's ALOP include restricting apple fruit imports to those fruit that have been cold stored, or limiting imports to apples that are 'retail -ready packaged fruit.'"
3004 
7.1270  In its second written submission, New Zealand ex tends the relevance of this alternative to 
ALCM: 
"In its first written submission, New Zealand also identified various other alternative 
measures for fire blight, European ca nker and ALCM that would meet the 
requirements of Article 5.6, but which woul d still be more trade restrictive than 
required.  A measure limiting imports to apples that are retail-ready packaged fruit was identified.
3005  Indeed, as noted above in respect of Article 5.1 and as confirmed 
by the experts, such a measure would e ffectively exclude the primary pathway for 
ALCM identified by the IRA.3006"3007 
7.1271  This argument by New Zealand references inter alia the retail-ready requirement that it raised 
originally only in regard to fire blight.  To expa nd the relevance of this alternative measure to ALCM, 
                                                      
2999 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Annex A-1 to this report, p. 2.  See also, New Zealand's first written submission, 
para. 3.83. 
3000 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
attached as Annex A-1 to this report, 7 December 2007, p. 3. 
3001 New Zealand's first wr itten submission, para. 4.513.  S ee also, New Zealand's first written 
submission, para. 4.523;  and New Zealand's second written submission, para. 2.896. 
3002 Australia's reply to Panel question 138 after the first substantive meeting. 
3003 New Zealand's second writte n submission, para. 2.894. 
3004 New Zealand's first writte n submission, para. 4.490. 
3005 (footnote original ) NZFWS, para. 4.490. 
3006 (footnote original ) See paras. 2.251 to 2.257.  Cross RPQ, Q 105 p. 15.  Professor Cross confirms 
that "if fruit were supplied from New Zealand 'retail ready' or 'just in time', then it seems most unlikely that any fruit would be returned to the orchard wholesalers for repacking":  Cross RPQ, Q 122, p. 22. 
3007 New Zealand's second writte n submission, para. 2.894.  WT/DS367/R 
 Page 499 
 
 
 New Zealand's argument references the followi ng two responses by Dr Cross on whether the 
importation of retail-ready packaged apples mi ght be an effective measure against ALCM: 
"Question 105  
Please comment on whether the considera tion in Australia's IRA regarding the 
inadequacy of an inspection and treatment system based on a 600 fruit sample to 
manage the risk for ALCM was objective and credible, relying on respected and 
qualified scientific sources.  Is such c onsideration sufficiently supported by the 
available scientific evidence?  (IRA, Part B, p. 188-190;  paras. 1094-1096 of 
Australia's FWS;  paras. 4.517-4.522 of New Zealand's FWS) 
Dr Cross : 
The adequacy of the 600 fruit sample size will very much depend on the way fruit is 
handled in Australia in particular the number of fruit that are likely to be placed or disposed of in the vicinity of an apple tr ee or trees.  As set out in my answer to 
question 98, two very different fruit hand ling scenarios would give very different 
risks of entry and establishment and quite different sampling sizes would be 
appropriate. 
If higher value, fruit is retail ready in pack s or cartons ready for sale held in cold 
stores and redistributed to markets with mi nimal breaks in the cold chain and there 
were minimal losses resulting in disposal of  fruits in the vicinity of orchards, the 
potential risks in this scenario are very low: [sic]  There would be virtually no opportunity for leaf midge adults to emerge, mate, exit the pack house and locate a 
susceptible apple tree.  A 600 fruit sample size would be very adequate to give a very 
minimal risk from disposal of small numbers of fruits by consumers etc in gardens or 
near orchards etc. 
If fruit arrived in bulk bins for grading and packing with larger numbers of discarded 
fruit being held temporarily at ambient temper atures outside before being disposed of 
possibly nearby in the vicinity  of an apple orchard, the potential risks for this scenario 
are much higher. 
... 
Question 122 
Does Australia's IRA provide an objective and coherent assessment of the likelihood 
and implications of New Zealand apples be ing repacked at rural packing houses in 
close proximity to orchards, when assessi ng the risks related to fire blight, European 
canker and ALCM?  Was such assessment m ade with proper methodological rigour?  
(Para. 4.418 of New Zealand's FWS;  and R 99 by Australia)  
Dr Cross
: 
Australia's IRA did provide an objective and coherent assessment with respect to 
'apples free from trash either packed or so rted and graded bulk from New Zealand' 
but appears it did not consider the case of re tail ready fruit.  It took into account two 
scenarios of different amounts of fruit being handled by the orchard pack house, 70-100% versus 0.1-5%.  This lead to very la rge (33 fold) differences in the estimates of 
the numbers of infested apples being handles [sic] at the orchard wholesaler utility WT/DS367/R 
Page 500  
 
 points (Tables 42 and 43) which resulted in the estimates of the partial probabilities 
of entry, establishment and spread which are high for the orchard wholesalers (Tables 44 and 45).  However, if fruit were supplied from New Zealand 'retail ready' 
or 'just in time', then it seems most unlik ely that any fruit would be returned to the 
orchard wholesalers for repacking.  The IRA n eeds to be recalculated with respect to 
this scenario."
3008 
7.1272  To extend the relevance of the retail-ready re quirement regarding ALCM, New Zealand also 
references an earlier part of  its second written submission.3009  In this earlier part New Zealand argues, 
under its Article 2.2 claim, that, as regards ALCM, Australia's IRA failed to take into account that 
New Zealand apples would be exported retail-ready.3010 
7.1273  As noted above, New Zealand identified in its first written submission the retail-ready 
requirement as an alternative only for fire blig ht, but immediately excluded the possibility of 
considering that as an alternative fire blight measure for the purposes of its Article 5.6 claim: 
"Such measures have little justification, however, as they would be based on an 
assumption that mature, symptomless apples could be a vector for the transmission of 
fire blight.  Since there is no scientific basis for any such assumption, New Zealand 
will restrict its consideration to the alter native measure of restricting imports to 
mature, symptomless apple fruit. "3011 
7.1274  Likewise, as noted above, in its second wr itten submission New Zealand argues that the 
retail-ready requirement would not be consistent  with Articles 2.2 and 5.1 of the SPS Agreement: 
"However, given that these additional a lternatives are based on the assumption that 
mature, symptomless apples are vectors for fi re blight and European canker, they are 
still more trade restrictive than required and would not be consistent with Articles 2.2 
and 5.1 of the SPS Agreement.  The fact that less trade restrictive measures than the 
measures at issue are still more  trade restrictive than required simply indicates the 
severity of the breach in this case."3012 
7.1275  In the light of these statements by New Zealand, the Panel has found that New Zealand did 
not validly identify the retail-ready requirement as an alternative measure regarding fire blight in the 
context of Article 5.6.3013  Given the absence of evidence and arguments by New Zealand under the 
three-pronged Article 5.6 test, the Panel has also  found that, even if New Zealand had properly 
identified the retail-ready requirement as an alternat ive fire blight measure, it would not have been 
appropriate or possible for the Panel to analyse this alternative under Article 5.6.3014 
7.1276  New Zealand attempts to extend the relevan ce of the retail-ready requirement regarding 
ALCM;  however, as the Panel has found, without havi ng validly identified it in the first place as an 
alternative in the context of fire blight.  Accord ingly, it would be inappropriate for the Panel to 
consider the mere reference in New Zealand's second written submission as having validly identified 
this requirement as an alternative in the context of ALCM.  As Australia points out, New Zealand's 
                                                      
3008 Dr Cross's replies to Panel questions 105 and 122, in  List of Replies from the scientific experts to 
questions posed by the Panel, paras. 629-631 and 692. 
3009 New Zealand's second written submi ssion, para. 2.894, footnote 1305. 
3010 New Zealand's second written submission, paras. 2.251 to 2.257. 
3011 New Zealand's first wr itten submission, para. 4.490 (emphasis added). 
3012 New Zealand's second written submission, para s. 2.894-2.895 (original emphasis).  See also, 
New Zealand's reply to Panel question 124 after the second substantive meeting. 
3013 See para. 7.1115 above. 
3014 See paras. 7.1118-7.1119 above.  WT/DS367/R 
 Page 501 
 
 
 second written submission misrepresents the relevant part of New Zealand's first written submission, 
which identified the retail-ready requirement only as an alternative in the context of fire blight and not 
ALCM. 
7.1277  The question is therefore, whether New Zeal and's attempt in its second written submission 
can be considered as identifying a new, second alte rnative measure regarding ALCM for the first 
time.  In principle, New Zealand would not be prevented from doing so.  According to the 
Appellate Body, "[t]here is no requirement in the DSU or in GATT practice for arguments on all 
claims relating to the matter referred  to the DSB to be set out in a complaining party's first submission 
to the panel."3015  Likewise, the panel in Japan – Apples found that "it is well established that a 
complainant is not prevented, as a matter of principle, from developing in its second submission 
arguments relating to a claim that is within the terms of reference of the panel, even if it did not do so 
in its first written submission."3016 
7.1278  In its second written submission New Zealand does not merely reference its argument in its 
first written submission concerning the retail-ready re quirement constituting an alternative fire blight 
measure but tries to extend its relevance to ALCM by also referencing another part of its same 
submission and two responses from Dr Cross on the issue of retail-ready apple imports.  Although 
these referenced materials relate to New Zealand's Article 2.2 claim, the Panel sees no problem with New Zealand using these materials also in regard to its Article 5.6 claim for ALCM.  At the same time, the party in question needs to explain how cross-referenced arguments and evidence advanced 
under another claim are relevant  for the claim in question. 
7.1279  In the context of Article 5.6, New Zealand e xplicitly references arguments and evidence it has 
made under its Article 2.2 claim.  Given the su bject-matter addressed in these cross-referenced 
arguments and evidence, New Zealand's cross-refe rencing under Article 5.6 could be read as 
advancing arguments and evidence on how the retail-ready requirement might fulfil the second element of the three-pronged Article 5.6 test, name ly whether it would achieve Australia's ALOP.  
The problem, however, is that neither these cross-re ferenced materials, nor any argument advanced by 
New Zealand in this dispute in the context of ALCM  relates to the first and third conditions of the 
Article 5.6 test.  In its attempt at extending the retail-ready requirement to ALCM, New Zealand 
merely alleges that these two conditions are fulfille d, without advancing any specific arguments on 
how the retail-ready requirement might be reasona bly available taking into account technical and 
economic feasibility as well as being significantly less trade restrictive than the contested 
SPS measure. 
7.1280  Later on in the proceedings, New Zealand has ad vanced arguments in regard to the first 
condition of the Article 5.6 test for the retail-r eady measure, but not for the other two conditions.
3017 
7.1281  As New Zealand also recognizes, the three conditions of the Article 5.6 test are 
cumulative.3018  Also, it is the complainant's task to adduce arguments and evidence to demonstrate 
that all three elements are fulfilled.  Since, in th e context of ALCM, New Zealand has not done that in 
regard to the third element of the Article 5.6 test  for the retail-ready requi rement, the Panel refrains 
from analyzing that requirement as an alternative measure for ALCM in the context of New Zealand's 
Article 5.6 claim. 
                                                      
3015 Appellate Body Report on EC – Bananas III , para 145. 
3016 Panel Report on Japan – Apples , para 8.64. 
3017 New Zealand's reply to Panel que stion 114 after the second substantive meeting, paras. 178-180. 
3018 New Zealand's first writte n submission, para. 4.487. WT/DS367/R 
Page 502  
 
 7.1282  As the Appellate Body stated in Japan – Agricultural Products , panels "[can]not ... make the 
case for a complaining party"
3019.  "[I]t was for the [complainant] to establish a prima facie case that 
there is an alternative measure that meets all thr ee elements under Article 5.6 in order to establish a 
prima facie  case of inconsistency with Article 5.6."3020 
7.1283  By alleging that a retail-ready requirement fulfils the first and third elements of the Article 5.6 
test for ALCM, New Zealand has articulated a cl aim under Article 5.6.  However, by advancing 
arguments for that measure only in regard to the first condition of the Article 5.6 test, New Zealand 
cannot be found to have made a prima facie  case for that claim. 
7.1284  In the light of the above, the Panel will restri ct its Article 5.6 analysis under ALCM to the 
sole alternative measure properly identified and argued by New Zealand in this context:  the 
inspection of a 600-fruit sample from each import lot. 
(b) Whether inspection of a 600-fruit sample from each import lot satisfies the three-pronged 
Article 5.6 test 
7.1285  As indicated above, the Panel will first assess whether New Zealand has made a prima facie 
case that the alternative ALCM measure suggested  by New Zealand fulfils the second condition of the 
Article 5.6 test.  Only if the Panel has found th at the second condition is fulfilled, will it turn to 
assessing the first and third of the three cumulative conditions under Article 5.6.3021 
(i) Second condition:  whether the inspection of a 600-fruit sample from each import lot achieves 
Australia's ALOP in regard to ALCM 
Summary of the Parties' arguments  
7.1286  New Zealand asserts that the inspection of a 600-fruit sample  from each import lot will 
achieve Australia's ALOP and thus  fulfils the second condition of the Article 5.6 test.  According to 
New Zealand, there is no basis for Australia's imposition of a 3,000-unit sample and the additional 
sensitivity it provides.  The IRA's assessment of th e risk of ALCM is not valid because it failed to 
take into account viability, key aspects of ALCM biology and normal trade practices.  Had the IRA 
taken such matters into account, the unavoidable conclu sion would have been that the unrestricted risk 
of ALCM through the export of apples from New Zeala nd is negligible.  This would meet Australia's 
ALOP.3022 
7.1287  New Zealand contends that even assuming, for the sake of argument, that the IRA's 
assessment of the unrestricted risk was valid, a 600-unit sample inspection would meet Australia's ALOP because it would ensure that the number of viable cocoons entering Australia is not enough to 
allow for establishment to occur and the risk  of transmission would remain negligible.
3023  
The standard AQIS fruit inspection of a 600 fruit sample would provide 95 per cent confidence that 
no more than 0.5 per cent (1 in 200) fruit have coco ons on them.  On this assumption, at least 4,000 
fruit (20 apples with cocoons ÷ 0.005 (infestation leve l) = 4,000) would need to be deposited in one 
place at the same time to obtain three apples with three live ALCM.3024  According to the 
New Zealand interception data provided to Australia  and set out in the IRA, the actual infestation 
                                                      
3019 Appellate Body Report on Japan – Agricultural Products II , para. 129. 
3020 Appellate Body Report on Japan – Agricultural Products II , para. 126. 
3021 See 7.1107 above 
3022 New Zealand's reply to Australia's question 4 after the first substantive meeting, paras. 11-14.  See 
also, New Zealand's reply to Panel question 139 after the first substantive meeting, para. 293. 
3023 New Zealand's reply to Australia's question 4 after the first substantive meeting, paras. 12-14;  
New Zealand's reply to Panel question 139 after the first substantive meeting, para. 293. 
3024 New Zealand's first writte n submission, para. 4.127.  WT/DS367/R 
 Page 503 
 
 
 level is much lower than that detected with 95 per cent confidence with a 600 fruit sample, and is 
more likely to be 0.13 per cent, not 0.5 per cent, suggesting that over 15,000 fruit would need to be deposited in one place at the same time to obtain three apples with live ALCM (20 apples with cocoons ÷ 0.0013 (infestation level) = 15,384).
3025 
7.1288  New Zealand argues that apple exports to Aust ralia will be retail ready and are therefore 
unlikely to be sent to orchard wholesalers.  As appl es will be sent straight to urban centres, the chance 
of large quantities of apples being discarded near apple trees is minimal.3026  In any event, large 
quantities of apples would not be discarded uncovered near apple trees at an orchard wholesaler.  In Australia, where removal of discarded fruit from orchards is essential for good fruit fly 
management, it would be contrary to good operational practice for commercial packing house 
operators, or even nearby orchardists, to leave any discarded fruit uncovered and exposed to pests.  
Also, fruit discarded in a landfill would almost cert ainly be covered within hours of it being left 
there.
3027  Even if large quantities of apples were  left uncovered for a short time, emergence  would be 
unlikely to occur.  ALCM will not emerge from fr uit as soon as it is removed from cold storage.  
It first has to break diapause and complete pupation, which takes at least 13-18 days.  Thus, an ALCM 
could not emerge from a viable cocoon attached to a discarded apple during the few hours it might 
remain uncovered as waste.3028  The likelihood of an Australian buyer of New Zealand apples 
disposing of at least 4,000 (let alone 15,000) of tho se apples uncovered at a single site near apple trees 
with new shoots is negligible.3029 
7.1289  In a later submission, New Zealand advances si milar arguments with slightly higher figures.  
New Zealand contends that the effect of a 600- unit sample would be that no more than 1 in 
approximately 6,500 New Zealand apples enteri ng Australia would have a viable cocoon. 
This equates to a final importation rate for tota l imports of 0.015 per cent (i.e. only 0.015 per cent of 
New Zealand apples entering Australia would have viable cocoons).  On the basis of such an 
importation rate (even discounting the prolonged period of adult em ergence) approximately 19,000 
apples would need to be left outside of cold storag e, uncovered, in the same place at the same within 
30-50 metres of newly unfurling apple trees, for th ere to be any likelihood of ALCM mating and egg 
laying occurring.  However, the likelihood of such a sequence of events occurring is negligible – it is 
an event that would almost certainly not occur.  Therefore, the 600-fruit inspection would clearly meet 
Australia's ALOP.3030 
7.1290  New Zealand concedes that the IRA has reviewed  and rejected the possibility that a 600-fruit 
inspection would achieve Australia's ALOP.  However, New Zealand points out, the IRA's 
calculations on the effect of a 600-unit sample insp ection were incorrect because they failed to factor 
in cocoon viability, ALCM biology and normal trade practices.3031  Further, the IRA's analysis of the 
appropriate measure for ALCM is incorrectly premised  on the infestation level, rather than the overall 
likelihood of ALCM entry, establishment and spread.3032  As confirmed by Dr Cross, the IRA should 
not have relied on the infestation level, but on the ov erall risk of entry, establishment and spread, as 
the key determinant of the appropriate measure for ALCM.  The infestation level is relevant only as 
an aspect of that assessment of the overall risk.  Had the IRA correctly focused on the overall risk of 
ALCM entry, establishment and spread – which, as  explained above in respect of Article 5.1 is 
                                                      
3025 New Zealand's first writte n submission, para. 4.128. 
3026 New Zealand's first writte n submission, para. 4.129. 
3027 New Zealand's first writte n submission, para. 4.130. 
3028 New Zealand's first writte n submission, para. 4.131. 
3029 New Zealand's first writte n submission, para. 4.132. 
3030 New Zealand's second written submission, para. 2.902.  See also, New Zealand's reply to 
Australia's question 4 after the first substantive meeting, para. 13. 
3031 New Zealand's reply to Australia's question 4 after the first substantive meeting, para. 14. 
3032 New Zealand's second writte n submission, para. 2.900 WT/DS367/R 
Page 504  
 
 negligible – it would have been clear that a 600- unit sample goes beyond what is required to meet 
Australia's ALOP.
3033 
7.1291  According to New Zealand, contrary to Austra lia's claims, Dr Cross did not express the view 
that the intensity of any inspection would need to be determined by reference to more reliable data 
such as viability.  Rather, he confirmed New Zeal and's position that the intensity of any inspection 
(i.e. the appropriate sample size) should be selecte d on the basis of a tolerance infestation level, 
determined on the basis of the overall risk and re levant ALOP.  Moreover, New Zealand argues that 
Dr Cross confirmed in both his written and oral resp onses that this was not th e approach used in the 
IRA.3034  Instead of identifying a tolerance level, the IRA simply used the infestation level as the key 
determinant in setting its measures and selected measures that would result in fumigation of virtually 
every apple, effectively taking a zero risk approach.3035  In New Zealand's view, Dr Cross has 
confirmed that the Australian measures were d esigned to detect all ALCM cocoons present on 
New Zealand apples.  The IRA is explicit on this  point.  It states that the reason the 600-unit 
inspection was not considered appropriate w as because it "would allow lots to pass without 
treatment."3036 
7.1292  New Zealand adds that, contrary to Australia's claim, ISPM 31 confirms that in selecting an 
appropriate sample size a tolerance infestation leve l should be identified to determine what would be 
an unacceptable risk.  In New Zealand's view, it does not endorse an approach of selecting measures 
designed to detect all infestation present.  No r did Dr Sgrillo endorse the IRA's approach.  New 
Zealand claims that, to the contrary, Dr Sgrillo c onfirmed only that a high inspection rate is required 
to detect low infestation levels.3037  While, New Zealand agrees with this statement, it submits that 
there was no need  for Australia to put in place measures th at would detect all ALCM cocoons on 
New Zealand apples.  Imposing a measure with such an  aim is akin to taking a zero risk approach.  
But, as Australia acknowledges, its ALOP is not zer o risk.  Therefore, in New Zealand's view, as 
confirmed by Dr Cross, Australia should only have  put in place measures designed to bring the risk 
within its ALOP.3038 
7.1293  Australia argues that its ALOP is not review able by a WTO panel or the Appellate Body.3039  
Application of the appropriate  standard of review precl udes a panel from conducting a de novo  review 
of whether a particular alternative measure would achieve a Member's ALOP, where the efficacy of such measure has been previously eval uated as Part of a risk assessment.
3040  If a panel has determined 
that the risk assessment is "objectively justifiabl e" (or where the validity of a particular risk 
assessment has not been challenged), that panel may not substitute its judgment on these Article 5.6 
questions for that of the risk assessor.  If a compla inant fails to demonstrate serious flaws with those 
aspects of the risk assessor's analysis, the pane l should accept the relevant findings of the risk 
assessment in the context of a claim under Article 5.6.3041 
                                                      
3033 New Zealand's second written submission, para. 2.901.  See also New Zealand's second written 
submission, paras. 2.896-2.902. 
3034 New Zealand's reply to Panel question 126 after the second substantive meeting, paras. 209-210.  
See, Dr Cross's reply to Panel question 120, in List of Replies from the scientific experts to questions posed by 
the Panel, para. 686. 
3035 New Zealand's reply to Panel que stion 126 after the second substantive meeting, paras. 209-210. 
3036 New Zealand's comments to Australia's reply to Panel question 104 after the second substantive 
meeting, para. 246. 
3037 Dr Sgrillo's reply in Transcript of the Panel's meeting with experts, para. 683. 
3038 New Zealand's comments to Australia's reply to Panel question 104 after the second substantive 
meeting, para. 249. 
3039 Australia's first written submission, para. 1075. 
3040 Australia's first written submission, para. 1098. 
3041 Australia's second written submission, para. 53.  WT/DS367/R 
 Page 505 
 
 
 7.1294  Australia argues that it does not aim for zero ri sk;  its ALOP is "very low".  Measures only 
need to be sufficient to bring the risk down to achieve the ALOP.  In the case of ALCM, there may be 
a situation where the infestation of New Zealand appl es with viable ALCM is at  such a low level that 
the unrestricted risk would no longer exceed the AL OP;  in such a case, SPS measures would not be 
required.3042  Australia contends that it based its measu res on the findings in the IRA indicating that 
the unrestricted risk for ALCM is "low", and th erefore exceeds Australia's ALOP.  The IRA Team 
assessed the alternative measure proposed by New Zealand, but found that a 600-unit inspection 
system alone would not reduce the risks associated with ALCM sufficiently to achieve Australia's 
ALOP.  As New Zealand has failed  to show that the Final IRA Report is not valid, the Panel should 
find that New Zealand's has not properly made its ALCM claim under Article 5.6.3043 
7.1295  Australia adds that its ALCM measure was not de vised to detect the pest on the majority of 
New Zealand apple samples.  In this regard, Dr  Cross has not fully understood the IRA Team's 
reasoning for finding that a 600-unit inspection woul d not be adequate.  The IRA Team took into 
account both its estimate that the unrestricted infestat ion rate for ALCM would be 4.1 per cent (mean) 
of the total proposed number of apples imported from New Zealand annually, and the August 2005 
data provided by New Zealand that the infestati on rate of the varieties of New Zealand apples 
exported to the United States (by the methods deployed) was between 0.1 and 0.38 per cent.3044  The 
IRA Team initially examined whether a 600-unit in spection would reduce the risk to Australia's 
ALOP, and found that a 600-unit inspection is very e ffective in detecting lots carrying pests at an 
infestation rate of 4.1 per cent.  However, the IRA Team's analysis concluded that if the infestation 
rate is as low as New Zealand's in formation suggested it may be (0.17 per cent), a 600-unit inspection 
system would not detect infestation in a certain pr oportion of lots.  At this rate, a 600-unit inspection 
system would allow lots to pass without treatment resulting in a final importation rate of ALCM for total imports of around 0.06 per cent.  When placed  in the model by the IRA Team this importation 
rate resulted in a restricted risk estimate that ex ceeded Australia's ALOP, indicating that, at least for 
infestation levels below 0.5 per cent, an inspec tion/treatment system based on a 600 fruit sample 
would not be adequate to manage the risk for AL CM.  The IRA Team found that at these infestation 
rates, a 3,000-unit inspection was needed to achieve  Australia's ALOP.  All of these figures are based 
on the 95 per cent confidence level.
3045  
7.1296  Australia adds that New Zealand has assumed th at the level of unrestricted risk for ALCM 
determined in the Final IRA Report is false, but it has not demonstrated that its alternative measure 
for ALCM would achieve Australia's ALOP on the b asis of the level of risk calculated by the IRA 
Team.3046 
7.1297  Australia agrees with Dr Cross that the choice of a risk management measure should be aimed 
at reducing the risk to a level which would achieve  the importing Member's ALOP.  There is a very 
close connection between the ALOP and the intens ity of sampling for inspection.  The purpose of 
Australia's inspection requirement for ALCM is to  detect lots where the numbers of ALCM present 
are at a level that results in a risk that would ex ceed Australia's ALOP.  In other words, the ALOP is 
used to derive the level of ALCM that could be to lerated in imported lots of apples but would still 
achieve Australia's ALOP.  The sampling intensity needs to be set based on both the level of ALCM 
                                                      
3042 Australia's reply to Panel question 104 after the second substantive meeting, para. 468.  See also, 
Australia's first written submission, paras. 1093-1097. 
3043 Australia's first written submission, para. 1092.  See also, Australia's first written submission, 
para. 1098. 
3044 Australia's first written submission, para. 1093. 
3045 Australia's reply to Panel question 104 after the second substantive meeting, paras. 464-465.  See 
also, Australia's first written submission, paras. 1093-1097. 
3046 Australia's first written submission, para. 1091.  See also Australia's first written submission, 
paras. 155 and 1089. WT/DS367/R 
Page 506  
 
 present before any inspection, and the level of ALCM  that can be tolerated which would still remain 
following the inspection.
3047 
7.1298  Australia points out that Dr Sgrillo confirmed the following three significant factors relevant 
to selection of an inspection level.  First, that th e underlying level of infestation is the appropriate 
starting point for determining the requisite rate of  inspection.  Second, that one would expect the 
inspection rate required to increase as the underlyi ng infestation level decreases.  Third, that a 
confidence level of 95 per cent is typically used by the scientific community  when determining an 
appropriate phytosanitary inspection rate, although th ere is no accepted international standard in this 
regard.  According to Australia, ISPM No. 31 also provides support to its contentions.3048 
The Panel's analysis  
7.1299  As Australia points out, the IRA has reviewed the 600-unit inspection suggested by 
New Zealand, and rejected it as inappropr iate for achieving Australia's ALOP.3049  Australia argues 
that this should prevent the Panel from reviewing the same alternative measure under Article 5.6 of 
the SPS Agreement, unless New Zealand proves that  the IRA does not constitute a proper risk 
assessment. 
7.1300  In the current dispute, the Panel has already f ound that Australia's IRA is not a proper risk 
assessment for ALCM within the meaning of Ar ticle 5.1 and Annex A(4) of the SPS Agreement.3050  
Accordingly, even accepting Australia's arguments,  there is no reason for the Panel to refrain from 
assessing whether the 600-unit inspection discarded by  the IRA fulfils the second condition of the 
Article 5.6 test. 
7.1301  The IRA's assessment of ALCM risk management measures started by considering the 
alternative measure of 600-unit inspection suggested by New Zealand.3051  First, the IRA concluded 
that this measure would be effective in certain circ umstances.  "With an infestation rate of 4.1% apple 
leafcurling midge will be detected in practically ev ery lot and therefore every lot will be fumigated.  
A 600 unit inspection is very effective in detecting lots carrying pests at this infestation rate.  
This combined with the high efficacy of a treatme nt results in a high degree of risk reduction."3052 
7.1302  However, the IRA then added that: 
"Clearly as the infestation rate decre ases then the probability that a 600-unit 
inspection system will detect apple leafcurling midge in a lot decreases.  Therefore some lots may not be treated but may still contain some apple leafcurling midge. 
...  It was found that the 'worst case' for the total number of apple leafcurling midge 
that would enter Australia undetected if a 600 fruit inspection/treatment system was 
used is with an infestation rate for apple fruit of about 0.17%.  If the infestation rate 
was around 0.17% then inspection followed by treatment based on a 600 fruit sample would allow lots to pass without treatment resulting in a final importation rate for the total imports of around 0.06%.  When placed  in the model this importation rate was 
                                                     
 
3047 Australia's reply to Panel question 104 after th e second substantive meeting, paras. 462-463. 
3048 Australia's reply to Panel question 104 after the second substantive meeting, para. 466. 
3049 Australia's IRA, Part B, pp. p. 188-192. 
3050 See para. 7.886 above. 
3051 The IRA's analysis of "Risk management for appl e leafcurling midge" states  at the outset that 
"[t]he assessment of the restricted ri sk starts by first considering the ef fect of a 600-unit inspection and any 
remedial action taken as a result of that inspection finding pests of quarantine concern."  Australia's IRA, Part B, 
p. 188. 
3052 Australia's IRA, Part B, p. 190.  WT/DS367/R 
 Page 507 
 
 
 found to result in a restricted risk  estimate that exceeded Australia's 
ALOP. This indicates that, at least for some infestation levels, an inspection/treatment 
system based on a 600 fruit sample may not be adequate to manage the risk for apple leafcurling midge."
3053 
7.1303  The IRA concluded that a 3,000-fruit inspection is necessary at this "worst case" infestation 
rate: 
"This predicted 'worst case' prevalence of 0.17% falls into the range of the 'August 05 
data' (0.1%–0.38%) on infestation provided by Pipfruit, New Zealand (Pipfruit NZ, 2005).  ...  The relationship between sample  sizes and the number of apple leafcurling 
midge that could be imported for infest ation rates between 0.1% and 0.38% was 
explored using standard statistical techniques ... .  On the basis of this analysis it was 
concluded that a sample size of 3000 per lot was needed.  With these infestation rates 
with a 3000 sample size the 'worst case' in festation rate that could be present in 
imports after inspection and treatment was 0.005%. 
... 
On the basis of this analysis the IRA team concluded that if infestation rates of export 
fruit were in the range of 0.1% to 0.38% then a 3000 fruit inspection would be effective in detecting apple leafcurling midge."
3054 
7.1304  The IRA added that the IRA Team was not ready to revert to the 600-unit inspection 
requirement, despite New Zealand's arguments about limited cocoon viability: 
"New Zealand provided additional data (Rogers  et al., 2006) showing that 36–42% of 
apple leafcurling midge cocoons on apples were empty, and nearly 60% of all 
cocoons contained dead apple leafcurling midge.  However, the IRA team still considers that this low level of infesta tion is still a risk, albeit a lower risk and 
maintains that a 3000 fruit inspection is required."
3055 
7.1305  The IRA then identified an alternative risk ma nagement measure to the 3,000-unit inspection, 
namely the treatment, e.g. fumigation, of all export lots: 
"An alternative to the inspection/treatment  approach may be the routine use of a 
mandatory treatment such as fumigation to all export lots.  This may be a less trade restrictive approach if the prevalence of appl e leafcurling midge is such that most or 
all lots are likely to fail at inspection.  A stakeholder suggested that fumigation should 
be mandatory.  However, the IRA team c oncluded that inspection as specified above 
with treatment only if live insects are found would be adequate to manage the risk. 
Therefore a requirement for mandatory fumigation was not justified."
3056 
7.1306  As a result of this analysis, the IRA identified two risk management options: 
"1. Inspection of a random sample of 3000 fruit from each lot.  Application of a 
suitable treatment (e.g. fumigation) or rej ection of any lots where apple leafcurling 
midge is found;  or 
                                                      
3053 Australia's IRA, Part B, p. 190. 
3054 Australia's IRA, Part B, p. 191. 
3055 Australia's IRA, Part B, p. 192. 
3056 Ibid. WT/DS367/R 
Page 508  
 
 2. Treatment of all lots with a suitable treatment to kill apple leafcurling 
midge."
3057 
7.1307  These are the measures whose consistency with Article 5.6 New Zealand contests in this 
dispute in the context of ALCM.  As noted above,  the Panel has already found in regard to these 
measures that the IRA's evaluation of the likelihood of entry, establishment and spread of ALCM is 
not based on a proper risk assessment.3058  The Panel has also found that various flaws in the IRA 
constitute a failure by the IRA to adequately take into account factors such as the available scientific 
evidence, the relevant processes and production me thods in New Zealand and Australia, the actual 
prevalence of viable ALCM, and relevant environm ental conditions, as required by Article 5.2 of the 
SPS Agreement.3059  In particular: 
(a) The Panel has found that the IRA's reasoning regarding the viability of ALCM , is not 
objectively justifiable, because the IRA does not adequately take into account the data 
on occupancy and viability of ALCM in cocoons and because the IRA contains no 
indication of how the exercise of expert judgement was exercised.3060 
(b) Similarly, the Panel has found that the IRA's reasoning regarding the viability of 
ALCM in the light of the possible incide nce of parasitism, caused by the wasp 
Platygaster demades , is not objectively justifiable, because the IRA does not consider 
the impact of parasitism by Platygaster demades  on cocoon occupancy and viability 
in its estimations.3061 
(c) The Panel has also found that the IRA's reasoning regarding the likelihood of transfer 
of ALCM in light of the protracted emergence of ALCM , is not objectively 
justifiable, because the IRA fails to ta ke into account the diminished chances of 
mating of ALCM due to the protracted period of emergence of ALCM adults relative to their short life span.
3062 
(d) Further, the Panel has found that the IRA's reasoning regarding the likelihood of 
establishment and spread of ALCM in Aust ralia, in the light of the existence of 
necessary climatic conditions and geogra phic range of these conditions, is not 
objectively justifiable.3063 
(e) Finally, the Panel has found that the IRA's reasoning regarding the unrestricted risk 
for ALCM through the importation of New Zealand apples into Australia, in the light of the mode of trade of those apples, is not objectively justifiable, because 
consideration of the different possible m odes of trade does not seem to have been 
adequately considered or transparently reflected in the IRA and has not had any 
evident impact on the IRA's conclusions.
3064 
7.1308  The Panel has found that New Zealand has not made a prima facie  case that orchards 
surrounding wholesale packing houses would not be located  at a distance that is within the flying 
range of ALCM.3065  Nevertheless, the Panel has conclude d that the flaws mentioned above are 
                                                      
3057 Australia's IRA, Part B, p. 192.  See also, Australia's IRA, Part B, pp. 319-322. 
3058 See paras. 7.886-7.887 above. 
3059 Ibid. 
3060 See paras. 7.800-7.806 above. 
3061 See paras. 7.810-7.812 above. 
3062 See paras. 7.840-7.841 above. 
3063 See para. 7.854 above. 
3064 See paras. 7.866-7.867 above. 
3065 See para. 7.824 above.  WT/DS367/R 
 Page 509 
 
 
 sufficient as to create reasonable doubts about the IRA as a pr oper risk assessment evaluating the 
likelihood of entry, establishment and spread of ALCM because the IRA has not  properly considered 
a number of factors that could have a major impa ct on the assessment of this particular risk.3066  
Hence, the Panel has concluded that the IRA's inspection and treatment requirements regarding 
ALCM on New Zealand apples are inconsistent w ith Articles 5.1 and 5.2 of the SPS Agreement.3067  
The Panel has also found that since the two altern ative ALCM requirements are not based on a risk 
assessment as provided in Article 5.1 of the SPS Ag reement, they can be presumed, more generally, 
not to be based on scientific principles or not to be maintained with suffi cient scientific evidence 
within the meaning of Article 2.2. 3068 
7.1309  These findings under Article 2.2 call into ques tion the two alternative ALCM requirements 
primarily because they are based on a flawed risk  assessment.  The findings also cast doubt on the 
IRA's justification for not accepting that the initia lly analysed 600-unit inspection would achieve 
Australia's ALOP, but instead imposing the two alternative ALCM measures. 
7.1310  Significantly, the IRA justifies the rejection of the 600-unit inspection alternative by the 
lower, "worst case" infestation level originating in the August 2005 data supplied by New Zealand.  
New Zealand, however, makes the case that the IRA' s analysis of New Zealand apple imports leading 
to an unrestricted risk exceeding Australia's ALOP is not objective and coherent.  Also, New Zealand 
argues that, even if that were not the case, th e 600-unit inspection would reduce the risk below 
Australia's ALOP – even at the "worst case" infestation level. 
7.1311  The Panel has found in the context of Articles 5.1 and 5.2 of the SPS Agreement that the 
IRA's risk assessment has various flaws.  These flaws show that the IRA has not properly considered 
a number of factors that could have a major impact on the assessment of the risk of ALCM from 
New Zealand apples.  In fact, these flaws create reasonable doubts about the IRA as a proper risk assessment evaluating the likelihood of entry, est ablishment and spread of ALCM into Australia. 
7.1312  Based on the factors where Australia's IR A shows the above-men tioned flaw s (cocoon 
viability, parasitism, adult emergence, climat e conditions and trade patterns) New Zealand 
demonstrates that with the "worst case" infest ation level, several thousand apples (15,000-19,000 
apples) imported from New Zealand would need to  be deposited uncovered for a sufficiently long 
period of time for any ALCM transmission to occur.   New Zealand also makes a convincing case that 
this situation will probably almost never occur. 
7.1313  The Panel recalls that it has found that New Zealand has not made a prima facie  case that 
orchards surrounding wholesale packing houses would not  be located at a distance that is within the 
flight range of ALCM.
3069  However, New Zealand refers to  Australia's modern packing house 
practices, which would make it highl y unlikely (should there be a serious incidence of waste deposit 
in the first place) that a large number of deposited apples would be left uncovered.  The Panel also 
notes Dr Cross's statement that ALCM normally stay close to the ground, and that they are weak fliers 
(in particular in wind).  "They are rather weak fl yers.  This particular species spends a lot its time 
close to the ground and only flies up into the tree to oviposit in the shoots when the wind conditions 
are rather slight.  So, it seems unlikely that it would have a very long range of dispersal."3070 
7.1314  The Panel notes that at the meeting with the experts, Australia asked Dr Sgrillo whether 
"[he w]ould ... agree that in order to have confidence in detecting a pest within a consignment that has 
                                                      
3066 See para. 7.871 above. 
3067 See para. 7.887 above. 
3068 Ibid. 
3069 See para. 7.824 above. 
3070 Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 586. WT/DS367/R 
Page 510  
 
 low levels of underlying infestation, a higher rate  of inspection may be required, compared to a 
consignment which had a hi gher level infestation ... ."
3071  In response, Dr Sgrillo explains that: 
"Usually, considering the same population size, if the infestation is higher you have 
to sample less, because …  I mean, if you have  more units infested in the population, 
this will require a smaller number of sample s to catch this infestation.  However, 
if you have a very low number, a very low per cent of infestation, you have to 
increase your sample size to catch it."3072 
7.1315  Dr Sgrillo confirms this in another of his res ponses to Australia:  "The infestation will tell you 
how much you have to decrease this infestation to r each your appropriate level of risk.  And also how 
sensitive has to be your inspection system to  catch any infestation above this level."3073 
7.1316  This response was, however, given to a questi on which Australia introduced by mentioning an 
important precondition: 
"Dr Sgrillo.  I'd like to ask you a ques tion about determining an appropriate 
inspection rate for a consignment in circumstances where it has been determined that 
the unrestricted risk is above the appropriate level of protection, and therefore that 
risk management measures are required .  Would you agree that the relevant factor 
for determining the appropriate rate of in spection for ALCM is the underlying level 
of infestation?"3074 
7.1317  It is evident from this precondition that even Au stralia considers the issue of infestation rate 
secondary to establishing whether, in relation to AL CM, the unrestricted risk of New Zealand apples 
(i.e. the risk arising from importing apples without imposing risk mitigation measures) would exceed 
Australia's ALOP. 
7.1318  Australia argues that ISPM No. 31 provides s upport for its assertion that a lower infestation 
rate requires a higher sample size.3075  ISPM No. 31 states that as in the case of Australia's IRA, 
inspection can be a legitimate and essential  management tool for pest risks: 
"[Inspection] provides the statistical b asis for, and complements, ISPMs No. 20 
(Guidelines for phytosanita ry import regulatory systems ) and No. 23 ( Guidelines for 
inspection ).  Inspection of consignments of re gulated articles moving in trade is an 
essential tool for the management of pest risks and is the most frequently used phytosanitary procedure worldwide to de termine if pests are present and/or the 
compliance with phytosanitary import requirements."
3076 
7.1319  ISPM No. 20, referenced by ISPM No. 31 stat es that "[p]hytosanitary inspections ... should be 
technically justified"3077, and explains that a pest risk analysis might be the basis for technical 
justification for a risk management measure, such as inspection.  "Technical justification such as 
through pest risk analysis (PRA) is required to de termine if pests should be regulated and the strength 
                                                      
3071 Australia's question to Dr Sgrillo in Transcript of the Panel's meeting with experts, para. 682. 
3072 Dr Sgrillo's reply in Transcript of the Panel's meeting with experts, para. 683. 
3073 Dr Sgrillo's reply in Transcript of the Panel's meeting with experts, para. 681. 
3074 Australia's question to Dr Sgrillo in Transcript  of the Panel's meeting with experts, para. 680 
(emphasis added). 
3075 Australia's reply to Panel question 104 after the second substantive meeting, para. 466. 
3076 Methodologies for sampling of consignments , 2008 (ISPM No. 31, FAO, Rome), submitted as 
Exhibit AUS-30, p. 6. 
3077 Guidelines for a phytosanitary import regulatory system , 2004 (ISPM No. 20, FAO, Rome), 
submitted as Exhibit AUS-170, p. 240.  WT/DS367/R 
 Page 511 
 
 
 of phytosanitary measures to be taken against them (ISPM No. 11: Pest risk analysis for quarantine 
pests, including analysis of environmental risks and living modified organisms , 2004; ISPM No. 21: 
Pest risk analysis for regulated non-quarantine pests )."3078 
7.1320  ISPM No. 23, also referenced in ISPM No. 31, confirms that inspection as a risk management 
measure is closely related to the pest risk that is  being addressed.  "[A]n inspection may be required to 
detect specified regulated pests at the desired le vel and confidence depending on the risk associated 
with them (see also ISPM No. 11: Pest risk analysis for quarantine pests including analysis of 
environmental risks and living modified organisms , 2004, and ISPM No. 21: Pest risk analysis for 
regulated nonquarantine pests )."3079 
7.1321  As New Zealand argues, ISPM 31 confirms that in selecting an appropriate sample size a 
tolerance infestation level should be identified to  determine what would be an unacceptable risk.3080  
ISPM No. 31 defines "tolerance level" as "the percen tage of infestation in the entire consignment or 
lot that is the threshold for phytosanitary action."3081  While ISPM No. 31 states that "[m]ost NPPOs 
have a zero tolerance level for all quarantine pests", it states: 
"However, an NPPO may determine to establish a tolerance level for a quarantine 
pest based on pest risk analysis  (as described in ISPM No. 11: Pest risk analysis for 
quarantine pests including analysis of environmental risks and living modified 
organisms , section 3.4.1) and then determine sampling rates from this. For example, 
NPPOs may determine a tolerance level that  is greater than zero because small 
numbers of the quarantine pest may be accep table if the establishment potential of the 
pest is considered low or if the intended  end use of the product (for example, fresh 
fruit and vegetables imported for processing) lim its the potential of entry of the pest 
into endangered areas."3082 
7.1322  In turn, ISPM No. 11, which is referenced by I SPMs Nos. 20, 23 and 31, explains that the risk 
assessment involves the establishment of an ALOP , and that risk management measures should be 
adopted only if the ALOP is exceeded: 
"Overall risk is determined by the examin ation of the outputs of the assessments of 
the probability of introduction and the economic impact.  If the risk is found to be unacceptable, then the first step in ri sk management is to identify possible 
phytosanitary measures that will reduce the risk to, or below an acceptable level. 
Measures are not justified if the risk is  already acceptable or must be accepted 
because it is not manageable (as may be  the case with natural spread).  ... 
Appropriate measures should be chosen b ased on their effectiveness in reducing the 
probability of introduction of the pest."
3083 
7.1323  With these elements of the relevant ISPMs in mind, the Panel notes that Dr Cross explains 
that the sample size should not be adjusted to the infestation level but to the ALOP, and that in the 
                                                      
3078 Guidelines for a phytosanitary import regulatory system , 2004 (ISPM No. 20, FAO, Rome), 
submitted as Exhibit AUS-170, p. 239. 
3079 Guidelines for inspection , 2005 (ISPM No. 23, FAO, Rome), p. 277. 
3080 New Zealand's comments to Australia's reply to Panel question 104 after the second substantive 
meeting, para. 248. 
3081 Methodologies for sampling of consignments , 2008 (ISPM No. 31, FAO, Rome), submitted as 
Exhibit AUS-30, p. 8. 
3082 Ibid. 
3083 Pest risk analysis for quarantine pests including analysis of environmental risks and living 
modified organisms , 2004 (ISPM No. 11, FAO, Rome), submitted as Exhibit NZ-124, pp 130-131. WT/DS367/R 
Page 512  
 
 latter respect the IRA's flawed risk analysis s hould be recalculated taking into account the factors 
which it has not properly considered: 
"The unrestricted risk estimation presented in Table 49 of Australia's IRA Part B 
p 187 needs to be recalculated for two different importation scenarios: 
1. Mature apple fruit free of trash, either  packed or sorted and graded bulk from 
New Zealand 
2. Retail ready fruit which would not be handled at sensitive utility points The August 2005 infestation rate  data should be used and viability, parasitism and the 
time span of adult emergence relative to adu lt longevity need to be taken into account 
in the recalculation.  The inclusion or excl usion of different utility points for the two 
importation scenarios is crucial.  Consideration needs to be given to the numbers of 
fruit that are likely to be placed or discarde d within the flight range of a susceptible 
host at the relevant utility points in formula ting the risk estimates.  It might be found 
that the unrestricted risk estimates for one or both of these scenarios then falls below 
Australia's ALOP. 
If not, then the sample sizes required to meet Australia's ALOP should then be 
recalculated for fruit subject to fumigation and not subject to fumigation for each of the two importation scenarios.  Note that the sample size should not be adjusted to fit 
the infestation rate which appears to be the case in the current analysis.  It should be 
set to meet Australia's ALOP.  
Until this is done, then it is inappropriate  to comment on the sample sizes and the 
need or otherwise for fumigation treatment required to meet Australia's ALOP."
3084 
7.1324  Dr Cross confirmed this at the Panel's meeti ng with the Parties and the experts, where he 
explained that the factors that the IRA has not properly taken into account are fundamental in establishing the appropriate sample size for any inspection requirement: 
"[I]f a 600-fruit sample showed that there is a 95 per cent chance of the 0.5 per cent 
of fruit being infested, if half of those fruit are non-viable, another 30 per cent 
parasitized and, in any case, there is only a 1 in 5 chance that the male and female 
would mate and meet each other in their life,  then that effective infestation level is 
reduced by a factor of 10, 20, 30 times, wh atever the factors are that are determined 
by doing this risk assessment and then that  needs to be applied to the sample sizes 
that are needed.  And I find it difficult to prejudge what those sample sizes should be.  
Clearly one factor that I believe would make quite a big difference to the risk is the 
mode of trade question.  If the apples we re retail-ready, ready-packed in smaller 
packs, that were not handled at the seven  wholesalers, that would greatly reduce the 
risk, maybe that would overcome the risk all together, but until that calculation is 
redone, it's difficult to decide what the sample size should be."
3085 
7.1325  In response to a question from the Panel, Dr Cr oss also confirmed that standard statistical 
techniques support the view that a 600-fruit sample would provide 95 per cent confidence that no 
more than 0.5 per cent (1 in 200) fruit have cocoons: 
                                                      
3084 Dr Cross's reply to Panel question 120, in List of  Replies from the scientific experts to questions 
posed by the Panel, paras. 684-687 (emphasis added). 
3085 Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 662.  WT/DS367/R 
 Page 513 
 
 
 "The 600 fruit sample would provide 95% confidence that no more than 0.5% (1 in 
200 fruit) have occupied cocoons, but the actua l infestation rate would be reduced by 
a factor 0.5 x 0.7 for reduced viability and parasitism and probably by a further factor of 0.1 – 0.5 for the protracted emergen ce relative to the short life span, actual 
effective infestation rates of 0.1% or  even 0.05% would be more realistic. 
Note also that the average rate of infestation of NZ apples by ALCM as indicated by 
the August 2005 data is 0.16%, 3 x lower than the 0.5% 95% confidence value that would be detected by a 600 fruit sample. 
Thus approximately 100, 500 or >1000 fruits would have to be discarded for 
infestation rates of 0.5, 0.1, and 0.05% in  one place for a 5% chance of at least one 
male and one female emerging to start an infestation. 
So to answer the latter Part of the questi on, a 0.5% infestation rate of occupied 
cocoons would have a 5% chance of initia ting an infestation if perhaps 500-1000 
fruits were discarded in one place within the female flight range of a susceptible host."
3086 
7.1326  In response to the Panel's subsequent question,  Dr Deckers was sceptical about the need for 
fumigating all New Zealand apples for ALCM.  "The n ecessity to treat all the lots when a fruit sample 
of only 600 apples is inspected is surprising:  why not only treat the lots of apples when they come 
from an infected orchard or when some ALCM have been found."3087 
7.1327  Dr Cross added in one of his written responses to the Panel that "[t]he requirements for a 
3,000-fruit inspection or for fruit fumigation are clea rly restrictive and alternative measures coupled 
with a 600-fruit inspection would be preferable provided they met Australia's ALOP."3088 
7.1328  In the light of above, the Panel finds th at New Zealand has made a prima facie  case that – 
given the flawed risk analysis in Australia's  IRA, including the flawed comparison between 
Australia's ALCM measure and the alternative measure identified by New Zealand – a 600-unit 
inspection would achieve Australia's ALOP.  Australia 's reference to ISPM No . 31 and its own flawed 
analysis in the IRA has not successfully rebutted th is prima facie case.  Thus the alternative ALCM 
measure identified by New Zealand fulfils the sec ond condition of Article 5.6 of the SPS Agreement. 
7.1329  The Panel notes in this context that Australia has a qualitative ALOP, defined as "providing a 
high level of protection aimed at reducing risk  to a very low level, but not to zero."3089  In 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 me asure would achieve this qualitative ALOP. 
7.1330  In this dispute the Panel needs to review Aust ralia's IRA, not conduct its own risk assessment.  
The Panel notes that the IRA acknowledges, when describing its ALCM risk management measures, 
that "it may be possible to develop other risk management measures (for example, perhaps based on 
                                                      
3086 Dr Cross's reply to Panel question 104, in List of  Replies from the scientific experts to questions 
posed by the Panel, paras. 624-627. 
3087 Dr Deckers's reply to Panel question 105, in List of Replies from the scientific experts to questions 
posed by the Panel, para. 632. 
3088 Dr Cross's reply to Panel question 120, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 688. 
3089 Australia's IRA, Part A, p. 3. WT/DS367/R 
Page 514  
 
 low pest prevalence in orchards or pest free places of production) but this w ould require more detailed 
information on apple leafcurling midge than is currently available."
3090 
7.1331  The Panel therefore reaches its above finding in regard to the second condition of the 
Article 5.6 test in the specific context of the IRA reviewed in the current dispute.  In other words, 
the Panel's finding that New Zealand has raised a pr esumption (i.e., made a prima facie case) that the 
600-unit inspection would reach Australia's ALOP is a legal, not a scientific finding.  If Australia 
conducts a proper risk assessment for New Zealand apples, subject to an objectively justifiable 
analysis it may conclude that the ALCM risk exceeds Australia's ALOP.  In light of such a 
conclusion, Australia may also impose a risk mana gement measure that is different from a 600-unit 
inspection.  Any such future risk assessment and ev entual adoption of risk management measures by 
Australia must comply with the relevant provisi ons of the SPS Agreement, in particular with 
Articles 2.2, 5.1, 5.2 and 5.6. 
(ii) First condition:  whether the inspection of a 600-fruit sample from each import lot is 
reasonably available taking into acc ount technical and economic feasibility 
7.1332  New Zealand argues that the alternative measu re of inspecting a 600-fruit sample from each 
import lot would satisfy the first condition of the Article 5.6 test, as this alternative measure is 
reasonably available taking into account  technical and economic feasibility.3091  According to 
New Zealand, this is the standard export and impor t phytosanitary inspection procedure for detection 
of quarantine pests applying to all plant commoditi es currently being traded between Australia and 
New Zealand, and it is used by many other c ountries.  The procedures to implement it already 
exist.3092  New Zealand adds that Australia has not cont ested that this alterna tive measure fulfils the 
first element of the Article 5.6 test.3093 
7.1333  Australia does not contest this, nor advance any specific arguments in this specific context.  
Australia makes only general arguments with regard to the first condition of the Article 5.6 test.  
Referencing the compliance panel report in Japan – Apples (Article 21.5 – US) , Australia argues that 
the technical and economic feasibility of a proposed  alternative measure "in the real world" is a 
fundamental element for determining whet her such measure should be considered 
"reasonably available".3094 
7.1334  The Panel agrees with Australia that, as the aforementioned compliance panel stated, "when 
considering whether an alternative measure is re asonably available taking into account technical and 
economic feasibility, [the adjudicator] should dete rmine whether the alternative measure would 
constitute an option reasonably available taking into  account technical and economic feasibility in the 
real world."3095 
7.1335  The Panel considers that this is exactly what  New Zealand has demonstrated in the current 
dispute.  As New Zealand argues, the 600-fruit inspection is already the standard sanitary and 
phytosanitary export and import inspection procedur e between the Parties, and the procedures to 
implement it already exist.  New Zealand contends  that the 600-fruit inspection is also applied by 
other WTO Members.  Australia does not contest an y of these arguments by New Zealand.  In fact, 
Australia's IRA references in the context of ALCM the " standard 600-fruit inspection" advanced by 
                                                      
3090 Australia's IRA, Part B, p. 319. 
3091 New Zealand's first written submission, p. 192.  See also New Zealand's first written submission, 
para. 4.516. 
3092 New Zealand's first writte n submission, para. 4.515. 
3093 New Zealand's second writte n submission, para. 2.896. 
3094 Australia's first written submission, para. 1077. 
3095 Panel Report on Japan – Apples (Article 21.5 – US) , para. 8.171.  WT/DS367/R 
 Page 515 
 
 
 Pipfruit NZ.3096  Likewise, in the context of mealybugs, the IRA references " standard  600-unit AQIS 
sampling procedures (to provide 95 per cent confiden ce of detecting a 0.5 per cent defect level or 
greater)"3097, and "note[s] that the requirement for inspec tion of 600 fruit is a general requirement to 
address a range of quarantine risks, not just mealybugs."3098 
7.1336  Accordingly, the 600-fruit inspection is an a lternative measure that is technically and 
economically feasible in the real world, and therefor e reasonably available – not only in theory but in 
actual practice.  Hence, the Panel finds that the alternative measure New Zealand advances in this 
dispute for ALCM fulfils the first condition of the Article 5.6 test. 
(c) Third condition:  whether the inspection of a 600-unit sample from each import lot is 
significantly less trade restrictive than Australia's current ALCM requirements 
(i) Summary of the Parties' arguments 
7.1337  New Zealand argues that the alternative measu re of inspecting a 600-fruit sample from each 
import lot would satisfy the third condition of th e Article 5.6 test.  The alternative would be 
significantly less trade restrictive than the two re quirements currently imposed by Australia, namely: 
(i) the inspection of a 3,000 fruit sample from each lot with a find resulting in mandatory treatment or 
rejection for export;  or (ii) the inspection of a 600 fruit sample from each lot, combined with 
mandatory treatment of all fruit.3099  The expert responses confirm that "[t]he requirements for a 3000 
fruit inspection or for fruit fumigation are clearly restrictive .'3100"3101  In response to Australia's 
argument that the alternative measure would need to be "significantly" less trade restrictive than 
Australia's current ALCM measure, New Zealand submits that the alternative measure meets that threshold.
3102 
7.1338  New Zealand argues in particular that it is already required to undertake a 600-fruit sample 
inspection of export apple fruit in order to comp ly with other more general quarantine pest 
requirements in the IRA.  Hence, the coverage of ALCM within the same 600-fruit inspection would 
certainly be a less time-consuming and expensiv e measure than sampling 3,000 fruit or requiring 
mandatory treatment of all fruit in addition to a 600 fruit sample.3103 
7.1339  As regards fumigation, New Zealand points out that both Australia's alternative requirements 
result in fumigation of virtually all consignments.3104  Also, New Zealand concedes that at a cocoon 
infestation level of 4.1 per cent, a 600-unit inspec tion would detect ALCM cocoons in most lots, 
which would mean that nearly all lots would be  subject to fumigation.  But, according to 
New Zealand, that is irrelevant because the co coon infestation rate of New Zealand apples is 
significantly lower than 4.1 per cent and only viable co coons are a risk factor.  On the basis of actual 
infestation rates of 0.16 per cent, and taking in to account that only 60 per cent of cocoons are 
occupied, only approximately 44 per cent of consignm ents would be expected to have an occupied 
ALCM cocoon found by inspecting a 600-unit sample.  Assuming that only detection of occupied 
                                                      
3096 Australia's IRA, Part B, p. 16 6, footnote 32 (emphasis added). 
3097 Australia's IRA, Part B, p. 289 (emphasis added). 
3098 Australia's IRA, Part B, p. 290. 
3099 New Zealand's first written subm ission, para. 4.514.  See also New Zealand's second written 
submission, paras. 2.884 and 2.896. 
3100 (footnote original ) Cross RPQ, Q 120, p. 22. 
3101 New Zealand's second written submissi on, para. 2.907 (original emphasis). 
3102 New Zealand's second writte n submission, para. 2.903. 
3103 New Zealand's first written subm ission, para. 4.520.  See also New Zealand's second written 
submission, para. 2.904. 
3104 New Zealand's second written submission, para. 2.905.  See also, New Zealand's reply to Panel 
question 141 after the first substantive meeting, para. 296. WT/DS367/R 
Page 516  
 
 cocoons will lead to fumigation, 56 per cent of cons ignments would pass without fumigation.  This is 
significantly less trade restrictive than a measure  requiring a 600 unit inspection plus mandatory 
treatment, both in terms of the costs of fumiga tion and the negative impact of fumigation on the 
quality, and therefore the competitiveness, of the product.
3105 In fact, not only is fumigation costly, it 
may have a negative impact on fruit quality.  Fumigation can cause a number of fruit disorders, 
including scalding, internal damage and staining, a ll of which restrict the marketability and therefore 
the competitiveness of the product.3106 
7.1340  Regarding Australia's suggestion that the 3, 000-unit sample could be minimized through a 
flexible operationalization of the measure, Ne w Zealand contends that apples exported by 
New Zealand to Australia would be subject to two inspections:  one by MAF in New Zealand prior to 
export and one by Australian officials in Austra lia.  The Australian requirement of a 3,000-unit 
inspection relates to the inspection completed by Aust ralian officials in Australia (or in New Zealand, 
if part of a pre-clearance programme).  In prac tice, prior to issuing a phytosanitary certificate, 
New Zealand would replicate the inspection requi rement carried out on the Australian side, and 
therefore incur the costs of both the 3,000-unit sample  in New Zealand and the sample in Australia.  
This would be necessary to ensure that lots cleared  by MAF are not rejected by Australia.  Australia's 
proposal of combining 600 unit inspections in Ne w Zealand is therefore not appropriate, because it 
would not match the same confidence/sensitivity le vel as the 3,000-unit inspection being carried out 
by Australia.3107  In fact, a 600-fruit sample would provide 95 per cent confidence that less than 0. 5  
per cent of the fruit are infested with ALCM.  A 3,000-fruit sample, being a significantly larger 
sample, would provide 95 per cent confidence th at less than 0.1 per cent fruit are infested.3108 
7.1341  At a later point in the proceeding, New Zeala nd argues that Australia misses the point in 
suggesting the flexible operationali zation of the 3,000-unit inspection.3109  In New Zealand's view, the 
key problem with Australia's proposal is that it relates not to the inspection completed by Australian officials in Australia but to the inspection comple ted by New Zealand officials in New Zealand.  
What Australia is proposing is that, while the Au stralian inspection would remain a 3,000 sample, 
New Zealand could combine individual 600-unit inspections in New Zealand towards the 3,000 
requirement.
3110  New Zealand submits that this measure will affect inspections undertaken by 
New Zealand officials since these inspections w ill fail to match the confidence/sensitivity levels 
applied by Australia.3111 
7.1342  New Zealand adds that its apple growers woul d be discouraged from exporting to Australia 
because of Australia's costly, time-consuming and unnecessary ALCM measure.  According to 
New Zealand, the economic risk factors for New Zealand growers set out with respect to fire blight 
and European canker also apply in the case of ALCM.3112  In the context its fire blight and European 
canker arguments under the third condition of the Article 5.6 test, New Zealand contends that 
compliance with Australia's onerous measures combin ed with the risk of being excluded from exports 
as a result of a single fire blight or European canker strike in an orchard creates a significant level of 
economic risk for New Zealand apple growers.  F aced with this risk, New Zealand apple growers 
would rather refrain from registering their orchards  for Australian export in the first place, and would 
turn to other export markets.  Conversely, under the alternative measure of restricting trade to mature, 
                                                      
3105 New Zealand's reply to Panel question 141 after the first substantive meeting, paras.295-297  See 
also, New Zealand's second written submission, paras. 2.905-2.906. 
3106 New Zealand's second writte n submission, para. 2.906. 
3107 New Zealand's reply to Panel question 139 after the first substantive meeting, paras. 291-292. 
3108 New Zealand's second writte n submission, para. 2.910. 
3109 New Zealand's second writte n submission, para. 2.908. 
3110 New Zealand's second writte n submission, para. 2.909. 
3111 New Zealand's second writte n submission, para. 2.910. 
3112 New Zealand's first writte n submission, para. 4.521.  WT/DS367/R 
 Page 517 
 
 
 symptomless apple fruit, an orchard would not be disqualified as a result of the discovery of a single 
fire blight or European canker strike on a tree.  Thus, New Zealand apple growers would avoid risking 
the loss of their investment.3113 
7.1343  New Zealand confirms Australia's argument that New Zealand apple exports to the 
United States are already subjected to much highe r inspection rates (up to 20,000 apples) than that 
required by Australia.  New Zealand points out th at regarding New Zealand apples, US sample sizes 
vary from 3,000 to 20,000 per consignment, depending on  the mode of trade.  However, as stated in 
the third party written submission of the United States, this sampling regime is designed to detect light 
brown apple moth, not ALCM.3114 
7.1344  Australia accepts that New Zealand's alternativ e measure may be less trade restrictive than 
Australia's current ALCM measure.  Australia cont ests, however, that the alternative measure would 
be "significantly" less trade restrictive.3115  According to Australia, it is not sufficient for a 
complainant to identify an alternativ e measure that is merely less rest rictive to trade than the existing 
measure.  Based on the language of footnote 3 to Article 5.6 of the SPS Agreement, the alternative 
measure must be "significantly less restrictive to tr ade" than the existing measure in order to find a 
violation of Article 5.6.  Thus, an alternative meas ure would need to be less restrictive to trade by a 
degree which is important, notable or consequential.3116 
7.1345  Australia submits that if the infestation rate of New Zealand apples is around 4.1 per cent, the 
alternative measure would clearly not be significantly less restrictive to trade than Australia's existing 
measure.  The IRA found that at an infestation rate  of 4.1 per cent a 600-unit inspection will detect 
ALCM in practically every lot and therefore prac tically every lot will be fumigated, which would 
effectively result in mandatory fumigation.  Such a measure would then be hardly less trade-restrictive 
than Australia's current option of a 600-unit inspection plus mandatory treatment.3117  In response to 
New Zealand's argument that Australia's selected measures would result in fumigation of virtually 
every apple, Australia notes that it is entitled to set  its own ALOP.  Furthermore, the IRA indicates 
that some New Zealand apples would not be fu migated because a 3000-unit inspection would still 
allow 0.005 per cent of New Zealand apples to enter Australia with viable ALCM on them.3118 
7.1346  In response to New Zealand's argument that a 300-unit inspection would be undertaken by 
Australian officials in addition to the 300-unit insp ection required to be undertaken by New Zealand, 
Australia submits that it requires only a single 3000- unit inspection per consi gnment (rather than per 
orchard) to be conducted under the auspices of New Zealand.3119  Australia adds that it is flexible 
about how the 3,000-unit inspection measure could be  operationalized.  New Zealand packing houses 
typically conduct a 600-unit pest inspection of each grow er lot that is received by a packing house.  
Multiple grower lots may be received in a day or processed in a single packing run, and go on to 
comprise a single consignment.  The 600-unit inspecti ons per grower lot could be aggregated for the 
single consignment, towards achieving the required 3,000- unit inspection.  In effect, this means that in 
                                                      
3113 New Zealand's first written s ubmission, paras. 4.507-4.508. 
3114 New Zealand's reply to Panel question 140 afte r the first substantive meeting, para. 294. 
3115 Australia's first written submission, paras. 1099-1100.  See also Australia's reply to Panel 
question 138 after the first substantive meeting. 
3116 Australia's first written submission, para. 1079. 
3117 Australia's first written submission, para. 1101.  See also, Australia's reply to Panel question 141 
after the first substantive meeting. 
3118 Australia's comments on New Zealand's reply to Panel questions after the second substantive 
meeting, para. 202. 
3119 Australia's opening oral statemen t at the second substantive meeting of the Panel with the Parties, 
para. 106. WT/DS367/R 
Page 518  
 
 many cases there would be no additional requirement  to that which New Zealand packing houses 
already apply, and therefore minimal trade-restrictive effects.
3120 
7.1347  Australia points out that the IRA defines "lot" as "all apple fruit packed for export to Australia 
each day by a registered packing house."  Therefore, a "lot" is not a fixed quantity.  Each lot would be 
inspected on the basis of a 3,000-unit sample selected  at random across the whole lot.  A unit is one 
piece of fruit.  Where a lot comprises apples from more  than one supplying orchard or block, then the 
inspection sample would be selected proportionally across all orchards/blocks.  The 3,000-unit inspection would be undertaken by, or under the au spices of, MAFNZ.  The cost implications will 
depend upon the circumstances of individual packing houses.
3121  In any event, the visual inspection 
required by Australia for ALCM is not a destructiv e examination – that is, it does not require cutting 
or other damage to the fruit.  Therefore, any fruit examined would remain available for export.3122 
7.1348  Australia points out that the practice of multiple  units of inspection is not unusual for trade 
between Australia and New Zealand.  For example,  in respect of fresh fruit exports from Australia 
that pose a risk of providing a vector for fruit fly, New Zealand requires each grower lot in a 
consignment to be subject to a 600-unit inspecti on by a delegated inspector, followed by a further 
600-unit inspection of the consignment by AQIS, followed by mandatory treatment. 
7.1349  According to Australia, under some circumstances New Zealand apple exports to the 
United States are already subjected to much highe r inspection rates (up to 20,000 apples) than that 
required by Australia.3123  Although the United States' measure is targeted at light brown apple moth, 
this measure is not indifferent to ALCM.  ALCM is  an actionable quarantine pest for California, and 
if any ALCM is discovered during such an inspecti on, then a notation would have to be made on the 
phytosanitary certificate to that effect, and it woul d also have to be marked "not suitable for 
California".  Further, lots inspected and found fr ee of ALCM during USDA pre-clearance inspections 
may enter all US States including California subject  to the ALCM-free status being indicated on the 
relevant form.3124 
(ii) The Panel's analysis 
7.1350  The Panel agrees with Australia that the third cond ition of the Article 5.6 test requires that the 
complainant identify an alte rnative measure that is " significantly  less restrictive to trade" than the 
contested measure(s).  This is in line with th e language of footnote 3 to Article 5.6 of the 
SPS Agreement3125, and it also accords with how previous pa nels and the Appellate Body identified 
this third condition.3126 
7.1351  Previous panels assessed the third condition of th e Article 5.6 test by looking at the difference 
in market access under the measures at issue and the alternative measure(s) identified by the 
complainant.  In particular, previous panels analysed whether, under th e alternative measure, 
                                                      
3120 Australia's first written submission, para. 1102.  See also, Australia's reply to Panel question 139 
after the first substantive meeting. 
3121 Australia's reply to Panel question 139 after the first substantive meeting. 
3122 Ibid. 
3123 Australia's first written submission, para. 1103. 
3124 Australia's reply to Panel question 140 after the first substantive meeting. 
3125 Footnote 3 to Article 5.6 of the SPS Agreement provides that "[f]or the purposes of paragraph 6 of 
Article 5, a measure is not more trade-restrictive than  required unless there is another measure, reasonably 
available taking into account technical and economic feasibility, that achieves the appropriate level of sanitary 
or phytosanitary protection and is significantly  less restrictive to trade."  (emphasis added). 
3126 See Appellate Body Report on Australia – Salmon , paras. 186 and 194;  Panel Report on Japan – 
Agricultural Products II , para. 8.72;  and Appellate Body Report on Japan – Agricultural Products II , para. 95.  WT/DS367/R 
 Page 519 
 
 
 "market access would be obtained significantly more easily than under the current regime"3127 and 
whether "the increased market access that would result under the alternative[] ... would be 
significant."3128  This Panel will assess, in light of the Par ties' arguments, whether this is the case in 
the current dispute. 
7.1352  Australia's contested ALCM measure has two alte rnative requirements.  As regards inspection 
intensity, only the first requirement, the 3,000-unit inspection, would differ from the 600-unit 
inspection alternative advanced by New Zealand.  In fact, the sample size of Australia's first 
requirement (3,000) is five times the sample size of the alternativ e advanced by New Zealand (600).  
Australia's second alternative requirement involv es the same 600-fruit sample  size as New Zealand's 
alternative.  Importantly, the two requirements under Australia's ALCM measure are alternatives.3129  
According to the IRA, "New Zealand could choo se either [of the two alternative requirements]."3130  
Accordingly, in the context of in spection, the alternative measure a dvanced by New Zealand might be 
less – let alone significantly less – trade restrictive onl y in comparison with Australia's first alternative 
requirement and not the second. 
7.1353  In principle, a more intensive inspection is cer tainly more costly and time-consuming than an 
alternative inspection with a five times smaller samp le size.  These cost a nd time burdens would arise 
on the New Zealand side, since under the IRA, MAFNZ or its accredited agency would be involved in 
the 3,000-unit inspection requirement.3131  Although New Zealand does not explain exactly how much 
more costly or time-consuming a 3,000-unit inspec tion might be than a 600-unit inspection, the Panel 
notes that New Zealand is advancing an alternative measure with a five times smaller sample size, 
which has been found to meet Australia's ALOP.  The Panel also recalls Dr Cross's statement that 
"[t]o inspect 3,000 fruits is a big requirement and w ould be, I think, quite a restriction on the possible 
trade.  It would be very difficult to do, in my view – expensive to do, if it was done for every orchard."
3132 
7.1354  Likewise, in response to the Panel Dr Cross e xplains that "[t]he requirements for a 3000 fruit 
inspection or for fruit fumigation are clearly restrictive and alternative measures coupled with a 
600 fruit inspection would be preferable provided they met Australia's ALOP."3133 
7.1355  The Panel considers that the higher costs of Australia's 3,000-unit inspection requirement are 
somewhat mitigated since, as Australia points out , visible inspection for ALCM is not invasive.  
Inspected apples would not be physically destroyed and could still be used for export.  This would 
reduce but not eliminate the difference in trade -restrictiveness between a 600-unit and a 3,000-unit 
inspection. 
7.1356  Ultimately, any differences between the trade restrictiveness of a 600-unit and a 3,000-unit 
inspection would only partly answer the questi on whether the alternative measure advanced by 
New Zealand would be significantly less trade rest rictive overall than the ALCM measure imposed by 
Australia.  As noted above, this latter has two a lternative requirements, and the first of these 
requirements differs from the alternative measure  advanced by New Zealand only in terms of 
inspection sample rate. 
                                                      
3127 Panel Report on Japan – Agricultural Products II , para. 8.96. 
3128 Panel Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.151. 
3129 Australia's IRA, Part B, p. 192.  See also, Australia's IRA, Part B, pp. 319-322. 
3130 Australia's IRA, Part B, p. 319. 
3131 Ibid. 
3132 Dr Cross's reply in Transcript of the Panel's meeting with experts, para. 662. 
3133 Dr Cross's reply to Panel question 120, in List of  Replies from the scientific experts to questions 
posed by the Panel, para. 683. WT/DS367/R 
Page 520  
 
 7.1357  The Panel therefore turns to assessing whether in terms of fumigation the alternative measure 
advanced by New Zealand would be significan tly less trade restrictive than Australia's 
ALCM measure. 
7.1358  In light of the information submitted by the Partie s, the Panel has reasons to believe that the 
first alternative requirement under Australia's ALCM measure, a 3,000-unit inspection, would 
effectively result in a fumigation of all lots.  In turn, the second alternative requirement under 
Australia's ALCM measure explicitly prescribes the fumigation of all lots. 
7.1359  Whether the alternative measure advanced by New Zealand would result in a lower 
fumigation rate of New Zealand apples depends on the ALCM infestation rate of New Zealand apples.  
The Parties agree that at an infestation rate of 4. 1 per cent, there would not be a significant difference 
in fumigation rates since at that infestation ra te the 600-unit inspection would find ALCM and result 
in fumigation for almost every lot.  At the same time , at an infestation rate of 0.16 per cent and taking 
into account that only 60 per cent of cocoons are occupied, according to New Zealand, only approximately 44 per cent of cons ignments would be expected to have an occupied ALCM cocoon 
found during a 600-unit sample.  Thus, assuming that only detection of occupied cocoons will lead to 
fumigation, 56 per cent of consignments would pass without fumigation at an ALCM infestation rate 
of 0.16 per cent. 
7.1360  The Panel notes that it has already found that the IRA's conclusion that New Zealand apples 
have a 4.1 per cent infestation rate does not result from a coherent and objective risk assessment.  As 
noted above, New Zealand has made a prima facie  case that an infestation rate more in the range 
found in the August 2005 data would be more realistic in light of the various factors that the IRA did 
not properly take into account.  
7.1361  If only around 44 per cent of lots would be exp ected to have an occupied cocoon and would 
need to be fumigated, the costs of fumigati on under the alternative measure advanced by 
New Zealand would be around half of the costs of mandatory or de facto fumigation of all lots under 
Australia's ALCM measure.  Australia does not c ontest New Zealand's argument that fumigation is 
costly.  Thus, at an infestation rate of around 0. 16 per cent, the fumigation costs of the alternative 
measure would be significantly lower than the fu migation costs under either of the alternative 
requirements of Australia's ALCM measure. 
7.1362  This significant difference in fumigation costs would also result in a significant difference in 
trade restrictiveness.  An SPS measure that is signi ficantly more costly for the complainant than an 
alternative measure, would certainly reduce market access or make it more difficult. 
7.1363  The Panel also notes that Australia does not contest New Zealand's argument that, 
unlike inspection, fumigation has an impact on the quality and marketability of apples.  In other words, fumigation directly affects the market acces s of New Zealand apples to Australia.  Hence, a 
measure involving half the fumigation rate of a nother measure would be significantly less trade 
restrictive than that other measure. 
7.1364  In the light of the above, the Panel concludes that New Zealand has demonstrated that the 
alternative measure of a 600-unit inspection of e ach import lot would be significantly less trade 
restrictive than Australia's current ALCM measure. 
(d) Conclusion on New Zealand's Article  5.6 claim in regard to ALCM 
7.1365  New Zealand has demonstrated that the alte rnative for the ALCM measure (Measure 14) 
fulfils all three cumulative conditions of the Article  5.6 test.  Accordingly, the Panel finds that 
Measure 14 is inconsistent with Ar ticle 5.6 of the SPS Agreement.  WT/DS367/R 
 Page 521 
 
 
 4. General measures 
(a) Alternative measure identified by New Zealand for the general measures 
7.1366  In the context of Article 5.6 of the SPS Ag reement, in its first written submission 
New Zealand references "auditing by AQIS officers of  New Zealand systems applicable to the import 
of apples to Australia from New Zealand"3134 as an alternative to the "[g]eneral" measures 
(Measures 15-17) identified in its panel request as follows: 
"[15] The requirement that Australian Qu arantine and Inspection Service officers 
be involved in orchard inspections for Eur opean canker and fire blight, in direct 
verification of packing house procedures, and in fruit inspection and treatment. 
[16] The requirement that New Zealand en sure that all orchards registered for 
export to Australia operate under standard commercial practices. 
[17] The requirement that packing houses provide details of the layout of 
premises."3135 
7.1367  In response, Australia argues that New Zealand fa iled to identify any real alternative for either 
of these three general measures.3136  First, Australia contends, New Zealand's alleged alternative is 
identical to Australia's existing requirement under Measure 15: 
"Australia's requirement in respect of AQIS  officers is that they will conduct systems 
audits only.  New Zealand's description of potential AQIS systems audits accords 
with Australia's view of its requirement.  Therefore, New Zealand has not identified an 'alternative' measure because it is in fact the same requirement as that which 
Australia imposes."
3137 
7.1368  Second, according to Australia, the alternative measure proposed by New Zealand cannot be 
an alternative for Measures 16 and 17.  Although New Zealand argues that Australia has not explained 
the basis for imposing these two measures, New Ze aland has not identified any alternative measure 
for these measures.  Therefore, New Zealand has failed to support its claim under Article 5.63138: 
"[New Zealand] has failed to demonstrate how  any 'alternative' measure could replace 
the other two general requirements.  In particular, Australia's requirement that 
'MAFNZ will ensure that all orchards regi stered for export to Australia are operating 
under standard commercial practices', is not  related to New Zealand's concern with 
'AQIS involvement' in inspections, etc.  Th e measure as challenged by New Zealand 
[as Measure 16] is: 
The requirement that New Zealand ensure that  all orchards registered for export to 
Australia operate under sta ndard commercial practices. 
                                                      
3134 New Zealand's first writte n submission, para. 4.525. 
3135 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Anne x A-1 to this report, p. 3. 
3136 Australia's first written submission, paras. 1 106-1112.  See also Australia's second written 
submission, para. 737. 
3137 Australia's first written submission, para. 1107.  See also Australia's second written submission, 
para. 737. 
3138 Australia's first written submission, para. 1112. WT/DS367/R 
Page 522  
 
 Thus, the measure at issue is not any AQIS verification of this requirement – rather, 
the challenge is against the substantive re quirement that orchards must operate under 
standard commercial practices.  Thus, an 'alternative' to the 'AQIS involvement' 
requirement is not an alternative to th e standard commercial practice requirement."
3139 
7.1369  Australia adds that New Zealand is wrong in ar guing that there is no justification in the IRA 
for Measures 16 and 17: 
"New Zealand has alleged that 'Australia does not provide any justification' for its 
requirement in respect of standard commerc ial practice.  This is clearly incorrect, 
as the Final IRA Report makes it clear that the IRA Team assumed that New Zealand exporters would operate under standard  commercial practice throughout its 
assessment of the unrestricted risk associated with importing New Zealand apples, 
and therefore assurance was required that all orchards registered for export to 
Australia would be operating unde r standard commercial practices. 
New Zealand also challenges the justificati on for the requirement that packing houses 
provide details of the layout of premises.  As explained above, a basic map of packing 
houses is sought in order that AQIS officers can identify areas of potential risk in the 
packing houses in preparation for the required packing house audits."
3140 
7.1370  In response, New Zealand explains that it sees important differences between Measure 15 and 
the alternative measure, which it identified in its first written submission as "auditing by AQIS 
officers of New Zealand systems applicable to the import of apples to Australia from New Zealand".
3141  "New Zealand's characterisation of an AQIS audit is very different from 
Australia's.  While, as explained above, Australia  has characterised the IRA's measure requiring 
'AQIS involvement' as '100% audit of survey t eams and packing houses', New Zealand's proposed 
alternative would involve the audit of only a sample  of the relevant New Zealand systems.  These are 
two very different things."3142 
7.1371  In its second written submission New Zealand slightly rephrases the suggested alternative 
measure as "an audit by AQIS officials of a sample  of the New Zealand systems that implement the 
relevant requirements"3143, and confirms that it proposes this alternative instead of "all three general 
measures."3144  According to New Zealand:  
"In terms of the relevant New Zealand systems that would be audited, in accordance 
with the findings of the panel in Japan – Apples , any AQIS involvement should relate 
only to those requirements imposed by Austra lia that are scientifically justified in 
accordance with Article 2.2.  Since none of the Australian measures at issue are 
scientifically justified, AQIS involvement should extend only to the two less trade restrictive alternatives available for fi re blight, European canker and ALCM 
(the requirements that apples be mature a nd symptomless and be subject to a 600 unit 
sample inspection)."
3145 
7.1372  New Zealand adds that "[c]onsequently, the l ess trade restrictive alternative for the three 
general measures would be an audit by AQIS of a sa mple of:  (i) the relevant New Zealand systems 
                                                      
3139 Australia's first written submission, paras. 1108-1109 (footnotes omitted). 
3140 Australia's first written submission, paras. 1110-1111 (footnotes omitted). 
3141 New Zealand's first writte n submission, para. 4.525. 
3142 New Zealand's second written submi ssion, para. 2.914 (footnote omitted). 
3143 New Zealand's second writte n submission, para. 2.916. 
3144 Ibid. 
3145 New Zealand's second written submi ssion, para. 2.915 (footnote omitted).  WT/DS367/R 
 Page 523 
 
 
 designed to ensure that apples are mature and symp tomless, and (ii) the procedures for inspection of a 
600-unit sample."3146 
7.1373  In the light of New Zealand's response to Au stralia's arguments, the Panel considers that 
New Zealand suggests the following alternative meas ure for all three general measures (Measures 15-
17) in the context of its Article 5.6 claim:  "an audit by AQIS of a sample of:  (i) the relevant 
New Zealand systems designed to ensure that apples are mature and symptomless, and (ii) the 
procedures for inspection of a 600-unit sample."3147 
7.1374  As New Zealand explains, it suggests this alte rnative not only for Measure 15 but also for 
Measures 16 and 17.  Accordingly, the Panel turn s to assessing whether this alternative satisfies the 
three cumulative conditions of the Article 5.6 test in regard to Measures 15-17. 
(b) Whether an audit by AQIS of a sample of: (i) the relevant systems designed to ensure that 
apples are mature and symptomless, and (ii) the procedures for inspection of a 600-unit sample satisfies the three-pronged Article 5.6 test 
7.1375  As the Appellate Body explained, to pass this three-pronged test of Article 5.6, 
the complainant needs to demonstrate that another, alternative measure: 
"(1) is reasonably available taking into account technical and economic 
feasibility; 
(2) achieves the Member's appropriate level of sanitary or phytosanitary 
protection;  and 
(3) is significantly less restrictive to trade than the SPS measure contested."
3148 
7.1376  As mentioned above, the Panel starts its anal ysis of the general measures with the third 
condition of the Article 5.6 test.3149  This condition entails whether the alternative measure identified 
by the complainant is significantly less trade restri ctive than the respondent's contested measure(s).  
Unlike the first two conditions of the Article 5.6 t est, the third condition requires a direct comparison 
between the contested and the alternative measure(s). 
7.1377  The Parties dispute whether such a comparison is possible, at least in regard to Measure 15.  
The possibility of such a comparison is thus an impor tant threshold issue for the Panel's analysis of 
the third condition of the Article 5.6 test.  Since the th ree conditions of this test are cumulative, this is 
also a threshold issue for the Panel's analysis  of the three-pronged Article 5.6 test as such. 
(i) Summary of the Parties' arguments 
7.1378  New Zealand argues that its alternative is l ess trade restrictive than Australia's general 
measures (Measures 15-17).  New Zealand notes that Australia's current measures would be time- 
consuming, labour-intensive and costly.  Also, th ey are unprecedented and not required in respect of 
any other exports from New Zealand to Australia.3150 
                                                      
3146 New Zealand's second writte n submission, para. 2.915 . 
3147 Ibid. 
3148 Appellate Body Report on Australia – Salmon , para. 194; and Appellate Body Report on Japan – 
Agricultural Products II , para. 95. 
3149 See para. 7.1108 above. 
3150 New Zealand's first written submission, para. 4. 534.  See also, New Z ealand's second written 
submission, para. 2.920. WT/DS367/R 
Page 524  
 
 7.1379  New Zealand does not agree with Australia's characterization of Measure 15 as a systems 
audit.
3151  An AQIS audit of New Zealand's systems would involve only a sample of all necessary 
aspects of the export programme.  ISPM No. 20 also requires "some sort of sampling process" of the relevant systems.
3152  Conversely, Measure 15 requires AQIS to conduct an audit of all survey teams 
and all packing houses3153, and none of Australia's explanati ons suggest less than 100 per cent 
inspection intensity.  In fact, Australia confirmed th at it would be necessary to audit each survey team 
at least in the first year of trade.3154  New Zealand adds that 100 per cent AQIS involvement for 
New Zealand apples is unprecedented.  Under Austra lia's regime applicable for stone fruit, AQIS will 
audit a sample of the systems being implemented by each of the sample operators.3155 
7.1380  New Zealand argues that its alternative would involve the audit of New Zealand relevant 
systems implementing scientifically justified requirements3156, which is significantly less trade 
restrictive than a measure requiring an audit of all survey teams and all packing houses.3157  
These systems audits would be less frequent and le ss intrusive since they would review and assess 
New Zealand phytosanitary practices only from time to  time.  According to New Zealand, this would 
validate existing procedures which Australia h as never suggested would be inadequate.  
The alternative would involve minimal additional co sts and would not require the creation of new, 
expensive and unnecessary systems.3158 
7.1381  New Zealand claims that Measure 15 would double the number of inspectors and it would 
more than double the cost of orchard and pack ing house inspections.  New Zealand would be 
responsible for the time costs of the AQIS inspec tors involved, as well as for their travel and 
accommodation expenses.  For instance, the orch ard inspections under Measure 15 involve an 
intensive and time-consuming requirement to use la dders to inspect the tops of trees for European 
canker.  New Zealand growers and exporters would incur these heavy and unjustifiable costs, which 
would be significantly trade restrictive.3159 
7.1382  New Zealand points out that Measure 16 would require NZMAF to verify through a costly 
compliance program that the apple industry is operating in accordance with standard commercial 
practices.  Australia does not provide any justifi cation for Measure 16, neither for Measure 17.  
These two measures have the effect of placing a trade restriction behind the border and are 
unwarranted.3160  In addition, New Zealand relies on the e xperts' responses to support its view that 
Australia does not provide any scientific basis for Measure 17.3161 
7.1383  New Zealand argues that even if the details of Measure 16, which requires compliance with 
standard commercial practices, have not yet been  developed, it would require MAFNZ to audit a 
                                                      
3151 New Zealand's reply to Panel question 46 after the first substantive meeting, para. 71.  See also, 
New Zealand's comments on Australia's reply to Panel questions 105-106 after the second substantive meeting, 
para. 250. 
3152 New Zealand's comments on Australia's reply to Panel questions 105-106 after the second 
substantive meeting, para. 252. 
3153 New Zealand's second writte n submission, para. 2.921. 
3154 New Zealand's comments on Australia's reply to Panel questions 105-106 after the second 
substantive meeting, para. 253. 
3155 New Zealand's reply to Panel question 109 after the second substantive meeting, para. 164.  
New Zealand's comments on Australia's reply to Panel question 107 after the second substantive meeting, 
para. 255. 
3156 New Zealand's second writte n submission, para. 2.915. 
3157 New Zealand's second writte n submission, para. 2.921. 
3158 New Zealand's first writte n submission, para. 4.536. 
3159 New Zealand's first writte n submission, para. 4.535. 
3160 New Zealand's first writte n submission, para. 4.537. 
3161 New Zealand's second writte n submission, para. 2.279.  WT/DS367/R 
 Page 525 
 
 
 sample of growers in order to verify that th e growers had followed the recommendations of the 
Industry Integrated Fruit Production Manual.  Accord ing to New Zealand, this verification component 
makes the process trade restrictive.  It is sci entifically unjustified, it would be costly and 
time-consuming, and it would have flow-on effect s concerning maintenance of auditable records of 
growers' monitoring and pest control activities.3162  In addition, Australia does not require the same 
verification under any other import risk analysis, for any other fruit exported to Australia, including 
stone fruit, kiwi or avocadoes.3163 
7.1384  New Zealand disagrees with Australia's argum ent that the standard commercial practice 
requirement is also included in other Australian import risk analyses.  The examples cited by 
Australia do not contain a requirement for the NPPO in the exporting country to verify that fruit has 
been produced in accordance with standard commercial practice.  For instance, Australia's risk 
analysis for longan and lychee fruit from China a nd Thailand states that all export orchards are 
expected to produce commercial longan and lychee un der standard cultivation, harvesting and packing 
activities, and Australia's import risk analysis fo r Indian mango provides that the existing commercial 
practice of a post-harvest fungicida l dip is an underlying requirement for export to Australia.  By 
contrast, the IRA for New Zealand apples requires that  MAFNZ ensure that all orchards registered for 
export operate under standard commercial practice.3164 
7.1385  New Zealand also contests Australia's reliance on the assumption that all New Zealand 
exporting orchards would operate under standard commercial practices.3165  The IRA provides no 
explanation how standard commercial prac tices would mitigate against assessed risk.3166  A risk 
assessment should not be allowed to build on unjustified assumptions that only serve to impose 
obligations on exporting countries.3167 
7.1386  Australia argues that New Zealand has accepted that all of Australia's measures are based on 
the IRA, i.e. that there is a rational relations hip between the risk assessment and the measures 
recommended by the IRA.  Accordingly, the Panel needs to determine only whether Australia's risk 
assessments for the three pests at issue are objectiv ely justifiable and whether the measures are more 
trade restrictive than required within the meaning of Article 5.6.  Australia advances that the 
justification of the general measures flows from th e technical justification of the pest-specific 
measures.3168 
7.1387  Australia contends that in the context of the th ird prong of the Article 5.6 test, it is not enough 
for the complainant to demonstrate that the alternativ e is merely less trade restrictive.  The alternative 
must be significantly less trade restrictive;  "significant" meaning "important, notable, 
consequential".3169  Australia's understanding of the panel report in  EC – Approval and Marketing of 
Biotech Products is that a given risk assessment may be s upported by a range of possible measures, 
and it is within the Member's discretion to choose a measure providing the best protection taking into 
                                                      
3162 New Zealand's second writte n submission, para. 2.922. 
3163 New Zealand's second written submission, para. 2.923.  See also, New Zealand's reply to Panel 
question 53 after the first substantive meeting, para. 80. 
3164 New Zealand's second writte n submission, para. 2.924. 
3165 New Zealand's comments on Australia's reply to Panel question 113 after the second substantive 
meeting, para. 266. 
3166 New Zealand's second writte n submission, para. 2.289. 
3167 New Zealand's comments on Australia's reply to Panel question 113 after the second substantive 
meeting, para. 266. 
3168 Australia's reply to Panel question 113 after the second substantive meeting, para. 493. 
3169 Australia's first written submission, para. 1079. WT/DS367/R 
Page 526  
 
 account its ALOP.  Accordingly, the Panel must re spect "a Member's right to choose its preferred 
measure, unless there is another measure that is significantly less restrictive to trade".
3170 
7.1388  Australia argues that the IRA does not define  the level of AQIS involvement required by 
Measure 15.  The requirement does not demand the involvement of Australia's authorities in all 
orchard inspections and packing houses operations.  For orchards inspections, the audit would include 
100% of survey teams in the field and the intensity of the audits would be adjusted over time 
depending on performance.  In the first year of tr ade, all relevant packing houses would be audited.3171  
Australia contends that these audits will be facilitated by Measure 17.3172  The latter requires packing 
houses to provide a basic map of the layout of their premises, so that AQIS officers can identify areas 
of potential risk in preparation for the required packing house audits.3173  Australia explains that AQIS 
clarified these requirements on a number of occasions  during bilateral discussions on the standard 
operating procedure in 2007 and early 2008.3174  The extent of AQIS involvement in fruit inspections 
will be determined when New Zealand completes th e required standard operating procedure and work 
plan to operationalize the requirements of the Fi nal IRA Report.  At that point and based on 
New Zealand's intentions, there may be a number of options to minimize costs and avoid duplication, 
as demonstrated by Australia's experience in join t inspections with the United States' authorities.3175  
Based upon information provided by New Zealand during a meeting with Australian officials, Australia offered that AQIS would conduct system audits and verifications in the first year of 
trade.
3176 
7.1389  With regard to Measure 16, Australia argues that the data provided by New Zealand during 
the IRA process was based on, or derived from, or chards and packing houses that follow standard 
commercial practices such as the Integrated Fruit Production (IFP) manual.  According to Australia, 
New Zealand did not provide any data relating to orchards or packing houses that do not follow the 
IFP manual.  Based on its meetings with New Z ealand officials and the New Zealand submissions, 
Australia asserts that New Zealand's access request  concentrated on apples processed under standard 
commercial practices.  Therefore the IRA did not assess the risk associated with other types of 
production, and the measures required by the IR A only apply to apples produced under standard 
commercial practices.3177  Australia adds that it does require  operation under standard commercial 
practices in the context of table grapes from Ch ile, longans and lychees from China and Thailand and 
for mangoes from India.3178 
(ii) The Panel's analysis 
7.1390  The Panel first addresses the threshold issu e whether the alternative advanced by 
New Zealand can be usefully compared with the ge neral measures, or at least Measure 15, for the 
purposes of the third condition of the Article 5.6 test. 
7.1391  In its earlier analysis of the Parties' disagreements concerning Measure 15, the Panel has 
noted how, despite its efforts and questions, it ne ver received a clear explanation of these procedures 
and how they would function,  and particularly of the frequency of AQIS involvement.3179  The Panel 
has also been unable to establish whether Measure 15 relates solely to the part of the IRA entitled 
                                                      
3170 Australia's first written submission, paras. 1080-1081. 
3171 Australia's first written submission, para. 151. 
3172 Australia's first written submission, para. 152. 
3173 Australia's first written submission, para. 153. 
3174 Australia's first written submission, para. 154. 
3175 Australia's reply to Panel question 102 after the second substantive meeting, para. 458. 
3176 Australia's reply to Panel question 105 after the second substantive meeting, para. 471. 
3177 Australia's reply to Panel question 113 after the second substantive meeting, para. 491. 
3178 Australia's first written submission, para. 968. 
3179 See para. 2.231 above.  WT/DS367/R 
 Page 527 
 
 
 "Requirement for pre-clearance" or whether it is al so addressed in the subsequent part of the IRA, 
entitled "Audit".3180  The Panel could not establish either whether Measure 15 involves 
"systems audits" as that term is understood by the Par ties;  the Panel merely noted that this issue is 
more directly related to New Zealand's claim under Article 5.6 of the SPS Agreement.3181 
7.1392  Further, the Panel has found that these uncertainti es with regard to the IRA in the context of 
Measure 15 are underscored by the IRA's requirement that the details of pre-clearance be addressed 
by the Parties in the standard operating manual a nd work plan, which have not yet been adopted.3182 
7.1393  While the Panel understands that New Zealand may not be responsible for the uncertainty 
regarding the scope of Measure 15, the burden still falls on New Zealand as the complainant to make 
a prima facie case regarding these requirements.  In  the light of the above uncertainties in the IRA 
regarding Measure 15 and in the absence of the st andard operating manual and work plan, the Panel 
cannot usefully compare Measure 15 with New Zealand' s alternative.  In particular, the Panel cannot 
assess whether New Zealand's alternative measure is less trade restrictive than Measure 15, let alone 
whether it is significantly less trade restrictive. 
7.1394  The Panel will continue its analysis of the third prong of the Article 5.6 test by looking at 
Measures 16 and 17.  The Panel will assess whet her New Zealand's alternative measure is 
significantly less trade restric tive than these two measures. 
7.1395  The Panel agrees with Australia that the third cond ition of the Article 5.6 test requires that the 
complainant identify an alte rnative measure that is " significantly  less restrictive to trade" than the 
contested measure.  This is in line with the language of footnote 3 to Article 5.6 of the 
SPS Agreement3183, and it also follows how previous panels  and the Appellate Body have identified 
this third condition.3184 
7.1396  Previous panels analysed the third condition of the Article 5.6 test by looking at the difference 
in market access under the meas ures at issue and the alterna tive measure identified by the 
complainant.  In particular, previous panels analysed whether, under th e alternative measure, 
"market access would be obtained significantly more easily than under the current regime"3185 and 
whether "the increased market access that would result under the alternative[] ... would be 
significant."3186 
7.1397  In regard to Measure 16, New Zealand contest s the IRA's assumption that all New Zealand 
growers interested in exporting to Australia w ould operate under standard  commercial practices.  
However, New Zealand does not explain what pro portion of New Zealand growers would need to 
adapt to standard commercial practices, or what woul d be the costs of such adaptation.  In fact, the 
element of Measure 16 that New Zealand contests most vigorously is not growers' compliance with 
standard commercial practices, but the verificati on by MAFNZ of such compliance.  New Zealand 
argues that it is this verification component th at makes Measure 16 trade restrictive because it is 
scientifically unjustified, it would be costly and time-consuming, and it woul d have flow-on effects 
                                                      
3180 See para. 2.215 above. 
3181 See para. 2.231 above. 
3182 See para. 2.225 above. 
3183 Footnote 3 to Article 5.6 of the SPS Agreement provides that "[f]or the purposes of paragraph 6 of 
Article 5, a measure is not more trade-restrictive than  required unless there is another measure, reasonably 
available taking into account technical and economic feasibility, that achieves the appropriate level of sanitary or phytosanitary protection and is significantly  less restrictive to trade."  (emphasis added). 
3184 See Appellate Body Report on Australia – Salmon , paras. 186 and 194;  Panel Report on Japan – 
Agricultural Products II , para. 8.72;  and Appellate Body Report on Japan – Agricultural Products II , para. 95. 
3185 Panel Report on Japan – Agricultural Products II , para. 8.96. 
3186 Panel Report on Australia – Salmon (Article 21.5 – Canada) , para. 7.151. WT/DS367/R 
Page 528  
 
 concerning maintenance of auditable records of gr owers' monitoring and pest control activities.  
New Zealand adds that Australia does not require the same verification under any other import risk 
analysis, for any other fruit exported to Australia, including stone fruit, kiwi or avocadoes. 
7.1398  The Panel can accept only part of these arguments as relevant for New Zealand's claim that 
the third prong of the Article 5.6 test is fulfille d in the context of Measure 16.  Indeed, whether 
Measure 16 is scientifically justified is distinct fro m its alleged trade restrictiveness.  The scientific 
justification of an SPS measure is not a matter of Article 5.6 but Articles 5. 1 and 5.2 and 2.2 of the 
SPS Agreement.  The Panel has already addressed this matter for Measure 16 in the context 
New Zealand's claim under the latter three provisions of the SPS Agreement.  Likewise, whether other 
IRAs have similar verification requirement s says little about Measure 16's alleged trade 
restrictiveness, and is a matter for Article 2.3, not Article 5.6 of the SPS Agreement. 
7.1399  New Zealand argues that verification of growers' compliance with standard commercial 
practices would be costly and time-consuming, and it would have flow- on effects concerning 
maintenance of auditable records of growers' mon itoring and pest control activities.  The Panel does 
not necessarily contest this.  Nonetheless, the Pa nel considers that New Zealand should have 
advanced more arguments and evidence to demonstr ate that its alternative is less – let alone 
significantly less – trade restrictive than Measure 16.  In particular, New Zealand should have explained and demonstrated how, by being less cos tly and time-consuming, its alternative measure 
would involve significantly increased market acc ess for New Zealand apples to Australia than 
Measure 16.  By merely referencing flow-on effect s, and asserting that Measure 16 is costly and time-
consuming, New Zealand has not demonstrated that its alternative measure would involve 
significantly increased market access for New Zealand apples to Australia. 
7.1400  Moving on to Measure 17, the Panel notes that New Zealand argues only that this measure is 
unwarranted and scientifically unjustified.  Agai n, the Panel cannot consider these arguments as 
sufficient to demonstrate that New Zealand's alte rnative measure would be significantly less trade 
restrictive than Measure 17. 
7.1401  In the light of the above, the Panel concludes th at New Zealand has not demonstrated that its 
alternative for the three general measure is significan tly less trade restrictively than the three general 
measures (Measures 15-17) either individually or ta ken as a whole.  Accordingly, New Zealand has 
not made a prima facie case that the alternative for the three general measures fulfils the third 
condition of the Article 5.6 test. 
(c) Conclusion on New Zealand's Article 5.6 cl aim in regard to the general measures 
7.1402  New Zealand has not made a prima facie case that the third condition of the Article 5.6 test is 
fulfilled in the context of the general measures.  Sin ce the three conditions of this test are cumulative, 
the Panel finds that New Zealand has not demonstr ated that Measures 15, 16 and 17 are inconsistent 
with Article 5.6 of the SPS Agreement. 
5. The Panel's conclusions on New Zealand's Article 5.6 Claim 
(a) The Panel's conclusions under Article 5.6 
7.1403  In the light of the above anal ysis, the Panel concludes that New Zealand has demonstrated 
that the contested pest-specific measures (Measures 1-11 and 13-14) are inconsistent with Article 5.6 
of the SPS Agreement, while New Zealand has failed to demonstrate the same for the three general 
measures (Measures 15-17).  WT/DS367/R 
 Page 529 
 
 
 (b) New Zealand's arguments linking its Article 5.6 claim to Article 2.2 of the SPS Agreement 
7.1404  In its first submission, New Zealand states at the end of its arguments under Article 5.6 that: 
"In addition, because they are more trade rest rictive than required, the measures also 
breach the requirement in Article 2.2 that  measures be 'applied only to the extent 
necessary to protect human, animal or plan t life or health.'  Australia has also, 
therefore, again, acted inconsistently with Article 2.2."3187 
7.1405  Article 2.2 provides that: 
"Members shall ensure that any sanitary  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 evidence, 
except as provided for in paragraph 7 of Article 5."  (emphasis added) 
7.1406  In response to New Zealand, Australia argu es, that in the absence of any substantive 
argument, it appears that New Zealand has e ffectively abandoned any claim under the first 
requirement of Article 2.2, and the Panel s hould refrain from considering the matter further.3188  
Australia points out that New Zealand has devoted only a single paragraph in its first written 
submission in support of any claim that Australia 's measures are inconsistent with the first 
requirement of Article 2.2.  New Zealand's argument is a postscript to its arguments in relation to Article 5.6, in particular the third condition of the Article 5.6 test.
3189 
7.1407  Australia submits that New Zealand has failed to  provide any explanation or argument as to 
why any finding under Article 5.6 of the SPS Agre ement that measures are "more trade restrictive 
than required" should automatically lead to a cert ain finding under Article 2.2.  Australia points out 
that the respective texts of Article 2.2 and Artic le 5.6 make no mention of the other provision.  
Previous panels or the Appellate Body have provided no guidance on this question.  They have opined 
merely that the first element of Article 2.2 is relevant context for interpreting the obligation in 
Article 5.6.3190 
7.1408   In any event, Australia adds, any outstanding claim by New Zealand in respect of the first 
requirement of Article 2.2 is clearly dependent on the outcome of its claims in respect of Article 5.6.  
Since New Zealand has failed to discharge its burden of proof in respect of Article 5.6, it has also failed to make such a case in respect of the first requirement of Article 2.2.
3191 
7.1409  The Panel has already found that the measures at is sue in this dispute are inconsistent with the 
clause of Article 2.2 requiring that Members' SPS measures be "based on scientific principles and is not maintained without sufficient scientific evidence."
3192  Accordingly, a positive settlement of the 
dispute does not require the Panel to assess whet her the same measures also violate the first 
requirement of Article 2.2. 
7.1410  The Panel therefore does not consider it nec essary to analyse this Article-5.6-related 
Article 2.2 claim by New Zealand, nor whether Ne w Zealand has properly articulated arguments for 
this claim.  Consequently, the Panel does not need to  engage in a detailed anal ysis of the relationship 
                                                      
3187 New Zealand's first writte n submission, para. 4.528. 
3188 Australia's first written submission, para. 1115.  See also, Australia's second written submission, 
para. 160. 
3189 Australia's first written submission, para. 1114. 
3190 Australia's first written submission, para. 1115. 
3191 Australia's first written submission, para. 1116. 
3192 See paras. 7.510, 7.779, 7.887 and 7.905 above. WT/DS367/R 
Page 530  
 
 between the third condition of the Article 5.6 test and the first requirement of Article 2.2 of the 
SPS Agreement. 
G. N
EW ZEALAND 'S CLAIMS UNDER ARTICLE  8 AND ANNEX  C(1)( A) OF THE SPS A GREEMENT  
1. Summary of the Parties' arguments 
7.1411  New Zealand makes claims under Annex C(1 )(a) and Article 8 of the SPS Agreement:3193  
according to New Zealand, Australia's violation of Annex C(1)(a) necessarily results in a violation of 
Article 8, which requires complian ce with the provisions of Annex C.3194  Australia disagrees, 
primarily by calling into question whether these clai ms, in particular the measures to which they 
relate, are within the Panel's terms of reference.3195 
(a) Parties' arguments on the substance of Annex C(1)(a) 
7.1412  In regard to Annex C(1)(a), New Zealand pr ovides a chronology of the issues regarding the 
access of its apples to Australia's market since 1919.3196  New Zealand points out that in January 1999 
it lodged its fourth request that Australia allow the importation of New Zealand apples.3197  
New Zealand "makes no complaint about th e commencement of the approval process."3198  
New Zealand contests the fact that "the approva l procedures were not completed until November 2006 
and the measures formally endorsed in March 2007, more than eight years after the filing of the 
request."3199 
7.1413  New Zealand argues that, in the light of the panel report in EC – Approval and Marketing of 
Biotech Products , the duration of the approval process le ading to the IRA constitutes undue delay 
within the meaning of Annex C(1)(a) of the SPS Agreement.  The delay was not due to science-
related factors.3200  Australia had already reviewed th e relevant science in the context of 
New Zealand's three earlier apple entry requests.3201  Moreover, the Japan – Apples dispute had dealt 
with phytosanitary measures for fire blight.  Rather, the delay was due to repeated changes to the risk 
assessment process and a parallel and inter linked, highly charged political process.3202 
7.1414  New Zealand adds that in April 1999 Aust ralia informed stakeholders, including 
New Zealand, that due to the review of New Zealand' s three previous entry requests, the risk analysis 
should not be technically complex and it "[would] ta ke approximately twelve months to complete".  
Accordingly, New Zealand hoped that the draft  IRA would be released in November 1999.  That 
ended up not being the case, and eventually the final IRA was issued after 94 months.3203 
                                                      
3193 New Zealand's communication to the Panel, 7 April 2008, submission regarding Australia's request 
for a preliminary ruling, para. 2.43. 
3194 New Zealand's first writte n submission, para. 4.563. 
3195 Australia's second written submission, para. 218. 
3196 New Zealand's first writte n submission, Annex 1. 
3197 New Zealand's first writte n submission, para. 4.551. 
3198 New Zealand's first writte n submission, para. 4.553. 
3199 New Zealand's first writte n submission, para. 4.551. 
3200 New Zealand's first writte n submission, para. 4.559. 
3201 New Zealand's first writte n submission, para. 4.561. 
3202 New Zealand's first written submission, paras. 4.55 4-4.559.  See also New Zealand's closing oral 
statement at the first substantive meeting of the Panel w ith the Parties, para. 11;  New Zealand's reply to Panel 
question 146 after the first substantive meeting, paras. 299-306; and New Zealand's closing oral statement at the second substantive meeting of the Panel with the Parties, para. 12. 
3203 New Zealand's second writte n submission, para. 2.934.  WT/DS367/R 
 Page 531 
 
 
 7.1415  New Zealand references a recent independent re view of Australian quarantine and biosecurity 
arrangements initiated by the Australian Government.3204   New Zealand argues that, in principle, 
the Australian Government agrees with the outcome of this review.3205  This review identifies the IRA 
for New Zealand apples as one of the IRAs that have "done much to generate international 
perceptions [concerning] trade-restrictiveness, unreasonable delays and questionable science."3206  
The report concludes that "these [IRAs] may have involved complex scientific assessments ... [but]  
the time taken [for completing these IRAs] is difficult to justify."3207  The report notes that the 2007 
changes to the regulations governing IRAs prescr ibe much tighter timelines:  30 months for an 
expanded IRA, and 24 mont hs for a standard one.3208  New Zealand points out that the IRA for 
New Zealand apples has exceeded these ma ximum timelines more than threefold.3209 
7.1416  In response, Australia reject s New Zealand's substantive arguments under Annex C(1)(a) and 
Article 8 of the SPS Agreement.  Australia submit s that New Zealand's arguments that the IRA is 
tainted by an intertwined political process are spurious and unsupported by evidence.3210  I n t e n s e  
political and public debate, parliamentary enquiries a nd domestic court proceedings "are not evidence 
of 'politicisation', but rather the normal functioning of a healthy democracy."3211  The SPS Agreement 
recognizes WTO Members' right to base their SPS measu res on scientific evidence, and this is what 
Australia has done in regard to New Zealand apples.3212 
7.1417  Australia provides a detailed list of the steps in its IRA process to fill in the gaps it perceives 
in the chronology put forward by New Zealand.3213  Australia points out that the independent report 
referenced by New Zealand recognized that the time ta ken to complete certain of Australia's IRAs was 
not unique.3214 
(b) Parties' arguments on whether New Zealand's clai ms are within the Panel's terms of reference 
7.1418  A key point of discord between the Parties unde r Annex C(1)(a) and Article 8 is whether the 
Panel's terms of reference cover New Zealand's clai ms, and the measures to which these claims relate. 
(i) Parties' arguments leading to Austra lia's second preliminary ruling request 
7.1419  In its written submission on Australia's first pr eliminary ruling request under Article 6.2 of 
the DSU, New Zealand argues that "the final IR A as a whole is inconsistent with Australia's 
                                                      
3204 One Biosecurity:  A Working Partnership, The Independent Review of Australia's Quarantine and 
Biosecurity Arrangements, Report to the Australian Government, 30 September 2008.  See New Zealand's second written submission, para. 2.935, footnote 101. 
3205 New Zealand's second written submi ssion, para. 2.935, footnote 101. 
3206 One Biosecurity:  A Working Partnership, The Independent Review of Australia's Quarantine and 
Biosecurity Arrangements, Report to the Australian Government, 30 September 2008, p. 112.  See 
New Zealand's second written submission, para. 2.935. 
3207 One Biosecurity:  A Working Partnership, The Independent Review of Australia's Quarantine and 
Biosecurity Arrangements, Report to the Australian Government, 30 September 2008, p. 100.  See 
New Zealand's second written submission, para. 2.935. 
3208 One Biosecurity:  A Working Partnership, The Independent Review of Australia's Quarantine and 
Biosecurity Arrangements, Report to the Australian Government, 30 September 2008, p. 100.  See 
New Zealand's second written submission, para. 2.937. 
3209 New Zealand's second writte n submission, para. 2.938. 
3210 Australia's first written submission, para. 1125. 
3211 Australia's first written submission, para. 28. 
3212 Australia's first written submission, para. 32. 
3213 Australia's first written submi ssion, para. 1058 and Annex 1. 
3214 Australia's reply to Panel question 127 after th e second substantive meeting, paras. 536-537. WT/DS367/R 
Page 532  
 
 obligations under the SPS Agreement.   That is the essence of New Zealand's Article 8 and 
Annex C(1)(a) claim."
3215 
7.1420  In response, Australia points out that New Zeal and's panel request did not identify "the IRA 
as a whole" as a measure at issue.3216  By challenging the IRA in and of itself as a measure at issue, 
"New Zealand has attempted to ... intr oduce a new claim in the dispute."3217 
7.1421  In its preliminary ruling on Australia's first preliminary ruling request, the Panel found that 
"New Zealand's panel request do es not identify with sufficient precision any measures contained in 
Australia's FIRA , other than the 17 specific items  identified through bullet points."3218 
7.1422  After this preliminary ruling, New Zealand argues in its first written submission that 
"Australia's process for considering New Zealand's request for access for New Zealand apples to the 
Australian market was delayed well beyond any reasonable period of time for considering the 
request."3219  In the light of the panel report in EC – Approval and Marketing of Biotech Products , 
undue delay in this "IRA process" is cove red by Annex C(1)(a) of the SPS Agreement.3220 
7.1423  In response, in its first written submission Australia argues that the "IRA process" is not a 
measure at issue, either.  The IRA process does not fall within the scope of New Zealand's panel 
request3221 because "no possible characterisation of th e 17 measures [identified in bullet points in 
New Zealand's panel request] could encapsulate the IRA process ."3222  The IRA process is also 
outside the Panel's terms of reference as clar ified by the Panel in its preliminary ruling.3223  Indeed, in 
its preliminary ruling the Panel effectively rejected  New Zealand's argument that the inconsistency of 
the final IRA as a whole is the essence of New Zealand's Article 8 and Annex C(1)(a) claim.3224  
Australia adds that New Zealand has not argued that any of the 17 measures at issue are subject to a 
claim of undue delay.  In any event, New Zeal and has failed to establish that the 17 measures are 
approval procedures within the meaning of Annex C(1).3225 
7.1424  Days before the Panel's first substantive m eeting, Australia submitted a second preliminary 
ruling request, making similar arguments.  Australia ask ed the Panel to rule that, in the light of the 
Panel's first preliminary ruling, New Zealand's undue  delay claim as it relates to the IRA process is 
outside the scope of the dispute.3226 
7.1425  Following the first substantive meeting, in th e course of which the Panel heard the Parties' 
and Third Parties' arguments on Australia's sec ond preliminary ruling request, the Panel found that 
Australia had not shown good cause for the Panel is suing a second preliminary ruling.  The Panel 
                                                      
3215 New Zealand's communication to the Panel, 7 April 2008, submission regarding Australia's request 
for a preliminary ruling, para. 2.9. 
3216 Australia's communication to the Panel, 14 April 2008, submission regarding Australia's request for 
a preliminary ruling, paras. 5 and 12. 
3217 Australia's communication to the Panel, 14 April 2008, submission regarding Australia's request for 
a preliminary ruling, para. 3. 
3218 Australia – Apples , Communication From the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, p.  4, para. 13(b). 
3219 New Zealand's first writte n submission, para. 4.541. 
3220 New Zealand's first writte n submission, para. 4.546. 
3221 Australia's first written submission, para. 1122. 
3222 Australia's first written submission, para. 1119 (o riginal emphasis).  See also Australia's opening 
oral statement at the first substantive meeting of the Panel with the Parties, para. 60. 
3223 Australia's first written submission, para. 1122. 
3224 Australia's first written submission, para. 1120. 
3225 Australia's first written submission, paras. 1123-1124. 
3226 Australia's second preliminary ruling request, 22 August 2008.  WT/DS367/R 
 Page 533 
 
 
 informed the Parties that it intended to addr ess New Zealand's claim regarding Article 8 and 
Annex C(1)(a) in its final report, toge ther with New Zealand's other claims.3227 
(ii) The Parties' further arguments 
7.1426  After this communication from the Panel, the Pa rties continued their exchange of arguments 
triggered by Australia's second preliminary ruling request.  These arguments by the Parties address in 
particular the type of measure covered by A nnex C(1)(a) of the SPS Agreement, and whether 
New Zealand's panel request had identified such a measure. 
New Zealand  
7.1427  New Zealand argues that "it has never claimed that the measure at issue is the 
'IRA process'."3228  New Zealand did not refer to th e IRA process in its panel request3229, and 
furthermore it is unclear how the IRA process could be regarded a measure at issue.3230  N o r  i s  
New Zealand arguing that the undue delay is the measure at issue.3231  Rather, "the measures at issue 
under New Zealand's Annex C(1)(a) and Article  8 claim are the 17 measures identified in 
New Zealand's panel request."3232  New Zealand contends that "the 17 measures ... at issue ... were not 
developed and adopted without undue delay."3233  In other words, the "SPS measures resulting from 
an unduly delayed process have not been impo sed in accordance with  the SPS Agreement."3234 
7.1428  New Zealand references the Appellate Body report in EC – Selected Customs Matters3235, and 
argues that Australia "blurs the distinction between legal claims  and measures at issue ."3236  
New Zealand refers to the IRA process because that approval procedure must be undertaken and 
completed without undue delay.3237  There is a close relationship between the IRA process and the 
measure at issue because "[t]he IRA process was th e process by which the measures at issue were 
developed."3238  So the IRA process is certainly relevant to New Zealand's claim, but it is not the 
                                                      
3227 Panel's response to Australia's second preliminary ruling request, 8 September 2008. 
3228 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 125.  See also, New Zealand's second written submission, para. 2.928. 
3229 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 125. 
3230 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 131. 
3231 New Zealand's reply to Panel question 143 afte r the first substantive meeting, para. 298. 
3232 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 126.  See also New Zealand's se cond written submission, para. 2.928. 
3233 New Zealand's reply to Panel question 143 afte r the first substantive meeting, para. 298. 
3234 New Zealand's second writte n submission, para. 2.928. 
3235 New Zealand's opening oral statement at the s econd substantive meeting of the Panel with the 
Parties, para. 112. 
3236 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 129 (original emphasis).  See also New Z ealand's second written submission, para. 2.930. 
3237 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 129. 
3238 New Zealand's reply to Panel question 143 afte r the first substantive meeting, para. 298. WT/DS367/R 
Page 534  
 
 measure at issue.
3239  It is the "procedure to check and ensure the fulfilment of SPS measures"3240, that 
is the "subject of the obligation [under Anne x C(1)(a)], ... not the measure at issue."3241 
7.1429  According to New Zealand, in a literal sense, the combined actions, omissions and decisions 
of various actors in the Australian system cumulatively resulted in an eight-year delay.  But it would be unrealistic to expect the complainant to identify these multiple causes as the measures at issue in an 
Annex C(1)(a) claim.
3242  In a broader sense, the cause of th e delay is inextricably linked to the 
intertwined political process.  However, the politici zation of the IRA process cannot be thought of as 
the measure at issue.3243  As the Panel explained in its preliminary ruling, the complainant need not 
provide the arguments with respect to th e undue delay claim in its panel request.3244 
7.1430  New Zealand contends that Article C(1)(a ) should be read in the context of the 
General Provisions of the SPS Agre ement, in particular Article 1. 1, which provides that SPS measures 
shall be "developed and applied" in accordance with the provisions of the Agreement.  Consequently, 
the obligation to undertake and complete approval procedures without undue delay is an obligation 
that relates directly to the "development" of SPS measures.3245 
7.1431  New Zealand adds that Australia is mistaken in  believing that the "measures at issue" under 
Annex C(1) must be the "procedures to check and ensure the fulfilment of SPS measures" referred to 
in the chapeau  of Annex C(1).3246  In the present dispute, the IRA process for New Zealand apples is 
the procedure to check and ensure the fulf ilment of SPS measures within the meaning of 
Annex (C)(1).3247  In fact, "[t]he IRA process is a specific application of Australia's more general 
approval requirements relating to the importation of fresh fruit and vegetables ... [,] set out in 
Australia's Quarantine Proclamation 1998, and Australia's Import Risk Analysis Handbook."3248  
The "sanitary and phytosanitary measures" referenced in the chapeau of Annex C(1) are Australia's 
regime relating to the approval of fresh fruit or vegetables.3249  This is not a measure at issue, and 
New Zealand is not claiming that Annex C(1) re lates to the development of that SPS measure.3250 
7.1432  According to New Zealand, in the light of the panel report in EC – Approval and Marketing 
of Biotech Products , the measures at issue do not th emselves need to satisfy the chapeau  of 
Annex C(1).  The European Communities' generic approval legislation relating to GMOs was not a 
                                                      
3239 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 129. 
3240 New Zealand's reply to Panel question 146 after the first substantive meeting, paras. 299-306. 
3241 New Zealand's opening oral statement at the s econd substantive meeting of the Panel with the 
Parties, para. 112.  See also, New Zealand's comments on Australia's reply to Panel question 128 after the 
second substantive meeting, paras. 284-289. 
3242 New Zealand's comments on Australia's reply to Panel question 128 after the second substantive 
meeting, paras. 284-289. 
3243 Ibid. 
3244 New Zealand's opening oral statement at the s econd substantive meeting of the Panel with the 
Parties, para. 114. 
3245 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 130. 
3246 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 126. 
3247 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 128. 
3248 Ibid. 
3249 New Zealand's reply to Panel question 146 after the first substantive meeting, paras. 299-306. 
3250 New Zealand's second writte n submission, para. 2.930.  WT/DS367/R 
 Page 535 
 
 
 measure at issue in that dispute.   The measure at issue was the de facto moratorium on approvals, 
which was not in itself a procedure to check  and ensure the fulfilment of SPS measures.3251 
7.1433  New Zealand points out that where SPS measu res were adopted following an approval 
process, the approval process itself has ceased to exist.3252  The IRA process is not challengeable in 
this dispute because it has ceased to exis t by the time the Panel was established.3253  In EC – Chicken 
Cuts the Appellate Body established that "the measur es included in a panel's terms of reference must 
be measures that are in existence at the time of the establishment of the panel."3254  In EC – Selected 
Customs Matters , the Appellate Body specified that there ar e two exceptions to this rule, but neither 
of these apply in the present dispute.  The measures at issue in this dispute did not arise after the 
establishment of the Panel, nor does this dispute i nvolve subsidies whose legislative basis has expired 
but whose effects continue to impair benefits accruing to the complainant.3255  An interpretation of 
Annex C(1)(a) that requires the complainant to ch allenge measures that have ceased to exist would 
not accord with the DSU's objective to secure a positive solution to the dispute.3256 
Australia  
7.1434  Australia considers that New Zealand's arguments  constitute an inadmissible attempt at curing 
the fatal flaw in its panel request.3257  Even at an advanced stage of the dispute, there remains 
considerable confusion concerning what measures New Zealand is challenging with respect to its 
undue delay claim.3258  In fact, New Zealand's undue delay clai m has constantly shifted in an attempt 
to bring it within the Panel's terms of reference.3259  At different points in the dispute, New Zealand 
claimed that the measure at issue was the IRA pr ocess or Australia's general approval requirements 
concerning the importation of fresh fruit or vege tables.  New Zealand's panel request, however, 
does not reference either the IRA process or  Australia's general approval requirements.3260 
7.1435  Australia contends that Annex C(1)(a) do es not refer to the "development" of SPS 
measures.3261  New Zealand's reliance on Article 1.1 of  the SPS Agreement in this regard is 
misplaced.3262  In line with the customary rules of interp retation, an analysis of Annex C(1)(a) should 
focus on the ordinary meaning of the terms used in that provision, in their context and in the light of 
the object and purpose of the SPS Agreement.3263  Annex C(1)(a) provides that "such procedures" are 
to be "undertaken and completed without undue delay."  "Such procedure" must be understood by 
reference to the immediate context, found in the chapeau of Annex C(1):  "procedures to check and 
                                                      
3251 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 127.  See also New Zealand's reply to Panel ques tion 146 after the first substantive meeting, paras. 299-
306;  and New Zealand's reply to Australia's question 18 after the second substantive meeting, paras. 43-47. 
3252 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 132. 
3253 New Zealand's reply to Australia's question 18 after the second substantive meeting, paras. 43-47. 
3254 New Zealand's opening oral statement at the s econd substantive meeting of the Panel with the 
Parties, para. 115. 
3255 New Zealand's reply to Australia's question 17 after the second substantive meeting, paras. 40-42. 
3256 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 133. 
3257 Australia's intervention on New Zealand's oral stat ement in relation to Article 8 and Annex C(1)(a), 
2 September 2008, p. 2.  See also, Australia's reply to Panel question 144 after the first substantive meeting;  Australia's second written submission, paras. 186 and 212;  and Australia's communication to the Panel, 
14 April 2008, submission regarding Australia's request for a preliminary ruling, paras. 13-14. 
3258 Australia's reply to Panel question 144 after the first substantive meeting. 
3259 Australia's second written submission, para. 184. 
3260 Australia's second written submission, paras. 214-216. 
3261 Australia's reply to Panel question 128 after th e second substantive meeting, paras. 538-545. 
3262 Australia's reply to Panel question 144 after the first substantive meeting. 
3263 Ibid.  See also Australia's second written submission, para. 187. WT/DS367/R 
Page 536  
 
 ensure the fulfilment of SPS measures."  If a pro cedure checks and ensures the fulfilment of a 
measure, logically that measure must already ex ist.  Thus a procedure within the scope of 
Annex C(1)(a) must check and ensure the fulfil ment of pre-existing SPS measures.  Therefore, 
Annex C(1)(a) cannot be an obliga tion that relates directly to the development of SPS measures.
3264  
If, as New Zealand argues, the IRA process is the re levant procedure in the context of Annex C(1), 
and assuming that the 17 requirements are the "SPS me asures" referred to in Annex C(1)(a), the IRA 
process must be checking and ensuring the fulfilmen t of the 17 SPS measures at issue.  The IRA 
process, however, took place before the 17 measures came into existence.3265  In fact, the 17 measures 
identified in New Zealand's panel request were a dopted on the basis of the recommendations in the 
IRA, which itself was a result of the IRA process.3266 
7.1436  Australia concedes that New Zealand's altern ative formulation, according to which the 
IRA process (as the relevant procedure) checks and ensures the fulfilment of Australia's quarantine 
framework (as the relevant SPS measure), may fit bette r within the ordinary meaning of the text of 
Annex C(1).  The fundamental problem with that, however, is that similar to the IRA process, Australia's quarantine framework is not id entified in New Zealand's panel request.
3267  Neither the 
IRA process, nor Australia's quarantine framework  are set out within the 17 specific measures at 
issue. 
7.1437  According to Australia, New Zealand's reliance on the  panel report in EC – Approval and 
Marketing of Biotech Products  is misguided.  In that dispute, Argentina and Canada clearly identified 
the subject of their undue delay claim by referring,  in their panel requests, to both the relevant 
EC approval processes and the European Communiti es' failure to approve without undue delay, 
applications for approval of specific products.3268 
7.1438  Australia adds that it is not blurring the dis tinction between measures and claims.  The IRA 
process is clearly the measure that New Zealand seeks to challenge.3269  Only the IRA process, and not 
the 17 requirements listed in New Zealand's pa nel request, could have caused a violation of 
Annex C(1)(a).3270  Accordingly, New Zealand should have identified the "IRA process" in its panel 
request as the measure at issue in the context of its  undue delay claim.  The IRA process clearly falls 
within the broad definition of measures subject to  WTO dispute settlement:  "'any act or omission 
attributable to a WTO Member'3271".3272  In EC – Selected Customs Matters , the Appellate Body held 
that "[t]he 'specific measure' to be identified in a panel request is the object of the challenge, namely, 
the measure that is alleged to be causing the vi olation of an obligation contained in a covered 
agreement.  In other words,  the measure at issue is what is being challenged by the complaining 
Member.3273"3274 
                                                      
3264 Australia's reply to Panel question 144 after the first substantive meeting.  See also Australia's 
second written submission, paras. 189-192. 
3265 Australia's second written submission, para. 196. 
3266 Australia's second written submission, para. 209. 
3267 Australia's second written submission, para. 197. 
3268 Australia's second written submission, para. 206. 
3269 Australia's comments on New Zealand's replies to Panel questions after the second substantive 
meeting, para. 225. 
3270 Australia's reply to Panel question 128 after the second substantive meeting, para. 544. 
3271 (footnote original ) Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review , para. 81. 
3272 Australia's reply to Panel question 128 after th e second substantive meeting, paras. 538-545. 
3273 (footnote original ) Appellate Body Report, EC – Selected Customs Matters , para. 130 
(original emphasis) . 
3274 Australia's second written submission, para. 199.  See also, Australia's second written submission, 
para. 201.  WT/DS367/R 
 Page 537 
 
 
 7.1439  In Australia's view, since New Zealand's clai m is that Australia failed to undertake and 
complete the IRA process without undue delay, an ar gument in support of that claim would have been 
that the IRA process was unduly delayed for specif ic reasons.  However,  Australia has never 
suggested that New Zealand needed to provi de such an argument in its panel request.3275 
7.1440  Australia sees no problem with the fact that th e IRA process ceased to exist by the time the 
Panel was established.  The quote in the Appellate Body report on EC – Chicken Cuts  is introduced 
with the words "[a]s a general rule".  Also, EC – Chicken Cuts addressed measures arising after the 
panel request.3276  Further, in EC – Selected Customs Matters  the Appellate Body was not talking 
about exceptions to the rule that a measure at issue must be identified in the panel request, but about 
exceptions to the general rule that measures that  have ceased to exist cannot be reviewed in WTO 
dispute settlement.3277  Also, the Appellate Body referenced "at least two exceptions", implying that 
the category of exceptions is not closed.  Further,  the Appellate Body appr oved the panel's statement 
in that dispute that "a panel may also be competent to make findings and make recommendations on measures that have expired
3278."3279 
7.1441  Likewise, Australia does not consider that the Appellate Body report in US – Certain 
EC Products supports New Zealand's arguments on the exclusion from WTO dispute settlement of 
measures that ceased to exist before panel establishm ent.  While in that dispute the Appellate Body 
refrained from making recommendations pursuant to  Article 19.1 of the DSU, it nonetheless made 
findings despite the measure having ceased to exist.  The Appellate Body followed a similar approach 
in US – Upland Cotton .3280 
7.1442  In any event, Australia argues, there was nothing to preclude New Zealand from making a 
claim of undue delay in relation to the IRA pro cess prior to its conclu sion in November 2006.3281  
If, in the alternative, New Zealand considered th at it could not challenge the IRA process because that 
process had already expired, New Zealand should  not have made an undue delay claim under 
Article 8 and Annex C(1)(a) in this dispute.3282 
2. The Panel's analysis 
7.1443  The first and main question in regard to New Zealand's claims under Annex C(1)(a) and 
Article 8 of the SPS Agreement is whether these cl aims, in particular the measures to which the 
claims relate, are within the Panel's terms of reference. 
7.1444  As indicated above3283, the Panel's terms of reference in this dispute are as follows: 
"To examine, in the light of the relevant provisions of the covered agreements cited 
by New Zealand in document WT/DS367/5,  the matter referred to the DSB by 
                                                      
3275 Australia's comments on New Zealand's replies to Panel questions after the second substantive 
meeting, para. 226. 
3276 Australia's reply to Panel question 129 after th e second substantive meeting, paras. 546-550. 
3277 Australia's comments on New Zealand's replies to Panel questions after the second substantive 
meeting, para. 221. 
3278 (footnote original ) Panel Report, EC – Selected Customs Matters,  para. 7.36;  Appellate Body 
Report, EC – Selected Customs Matters,  para. 184 (emphasis added). 
3279 Australia's comments on New Zealand's replies to Panel questions after the second substantive 
meeting, para. 222. 
3280 Australia's reply to Panel question 129 after th e second substantive meeting, paras. 546-550. 
3281 Ibid. 
3282 Australia's comments on New Zealand's replies to Panel questions after the second substantive 
meeting, para. 227. 
3283 See para. 1.3 above. WT/DS367/R 
Page 538  
 
 New Zealand in that document, and to ma ke such findings as will assist the DSB in 
making the recommendations or in giving the rulings provided for in those agreements."
3284 
7.1445  Under Article 7 of the DSU, and according to established jurisprudence, a panel's terms of 
reference are usually determined by the compla inant's request for establishing the panel.  In EC – 
Bananas III , the Appellate Body explained that "[i]t is important that a panel request be sufficiently 
precise for two reasons:  first, it often forms the basi s of the terms of reference of the panel pursuant 
to Article 7 of the DSU;  and, second, it informs the defending party and the third parties of the legal 
basis of the complaint."3285 
7.1446  In the present dispute, New Zealand's panel request provides in relevant part: 
"On 27 March 2007, the Australian Director of Animal and Plant Quarantine 
determined a policy for the importation of apples from New Zealand:  'Importation of 
apples can be permitted subject to the Quarantine Act 1908 , and the application of 
phytosanitary measures as specified in the Final import risk analysis report for 
apples from New Zealand , November 2006'.3286 
New Zealand considers that the measures specified in and required by Australia 
pursuant to the Final import risk analysis report for apples from New Zealand  are 
inconsistent with the obligations  of Australia under the Agreement  on the Application 
of Sanitary and Phytosanitary Measures  ('SPS Agreement'). 
In particular, New Zealand considers that the following measures are, both 
individually and as a whole, inconsistent w ith the obligations of Australia under the 
SPS Agreement: 
[bullet point list of 17 specific requirements spelt out in the IRA] New Zealand considers that the above measur es are inconsistent with the obligations 
of Australia under Article[] ... 8 (in relati on to Annex C) and Annex C(1)(a) of the 
SPS Agreement."
3287 
7.1447  In EC – Bananas III , the Appellate Body prescribed a clo se scrutiny of panel requests.  "As a 
panel request is normally not subjected to detaile d scrutiny by the DSB, it is incumbent upon a panel 
to examine the request for the estab lishment of the panel very carefully to ensure its compliance with 
both the letter and the spirit of Article 6.2 of the DSU."3288 
7.1448  In US – Carbon Steel , the Appellate Body held that the actual wording of panel requests is 
key for this kind of analysis.  "[C]ompliance w ith the requirements of Article 6.2 must be 
demonstrated on the face of the request for the establis hment of a panel.  Defects in the request for the 
establishment of a panel cannot be 'cured' by subse quent submissions of the parties during the panel 
proceedings."3289 
                                                      
3284 Australia – Apples , Constitution of the Panel Established at the Request of New Zealand:  Note by 
the Secretariat (WT/DS367/6), 13 March 2008, p. 2. 
3285 Appellate Body Report on EC – Bananas III , para. 142. 
3286 (footnote original ) Biosecurity Australia Policy Memorandum 2007/07, 27 March 2007. 
3287 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, attached as Anne x A-1 to this report, pp. 1-3. 
3288 Appellate Body Report on EC – Bananas III , para. 142. 
3289 Appellate Body Report on US – Carbon Steel , para. 126.  WT/DS367/R 
 Page 539 
 
 
 7.1449  As explained above, upon Australia's request, in  its preliminary ruling the Panel clarified its 
terms of reference in regard to the measures at issue as follows: 
"Looking at the text of New Zealand's panel request, the Panel finds that, with respect 
to the 17 items identified by New Zealand through 17 separate bullet points, the request is sufficiently precise in identif ying the specific measures at issue with 
respect to those 17 items, pursuant to Article 6.2 of the DSU. 
On the other hand, given the length and complexity of Australia's FIRA , the Panel 
finds that the broad reference in New Z ealand's panel request to the 'measures 
specified in and required by Australia pursuant to the [ FIRA ]' fails to satisfy the 
requirement of sufficient clarity in the iden tification of the specific measures at issue 
set forth in Article 6.2 of the DSU.  Accordingly, the Panel finds that its terms of 
reference are limited to the 17 measures speci fically identified by New Zealand in its 
panel request and do not encompass other measures that may be contained in Australia's FIRA , but which were not identified with sufficient precision in the panel 
request."
3290 
7.1450  The Panel's preliminary ruling concluded that: 
"(a) With respect to the 17 items contained in Australia's Final import risk 
analysis report for apples from New Zealand  (FIRA ) and identified by bullet 
points in New Zealand's request for the establishment of this Panel, dated 7 December 2007, the specific measures at issue have been properly identified; 
(b) New Zealand's panel request does not identify with sufficient precision any 
measures contained in Australia's FIRA , other than the 17 specific items 
identified through bullet points.  Accordingly, any such other measures are not part of this Panel's te rms of reference;  and, 
(c) New Zealand's panel request contains  sufficient information regarding the 
legal basis of the complaint to present th e problem clearly with respect to the 
17 identified items."
3291 
7.1451  It is clear from the preliminary ruling that the Panel effectively limited the measures at issue 
in this dispute to the 17 specific requirements in the IRA identified in the 17 bullet point items 
contained in New Zealand's panel request.  The preliminary ruling explicitly excluded from the 
Panel's terms of reference any ot her requirements contained in the IRA that New Zealand had not 
identified in the 17 bullet points.  Consequently, Au stralia is correct in arguing that the IRA as a 
whole cannot constitute a measure at issue in this dispute. 
7.1452  In any event, even absent the clarification of the Panel's terms of reference resulting from the 
Panel's preliminary ruling, the IRA as a whole would not  be within this Panel' s terms of reference.  
New Zealand's panel request does not identify the IRA as a whole as a measure at issue in this 
dispute.  It refers to "the measures specified in a nd required by Australia pursuant to [the IRA]", and it 
identifies 17 specific requirements.  The IRA is a long, complex document that specifies a large 
number of requirements in relation to  many different pests.  For this  reason, the Panel held in its 
                                                      
3290 Australia – Apples , Communication From the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, p. 3, paras. 8-9. 
3291 Australia – Apples , Communication From the Chairman of the Panel:  Preliminary Ruling by the 
Panel (WT/DS367/7), 23 June 2008, attached as Annex A-2 to this report, p. 4, para. 13. WT/DS367/R 
Page 540  
 
 preliminary ruling that the broad reference to the "measures specified in a nd required by Australia 
pursuant to [the IRA]" was not sufficiently precise in identifying the measures at issue.  However, 
even if this portion of the panel request remained part of the Panel's terms of reference, it does not 
identify the IRA itself as a measure at issue and, as such, the IRA taken as a whole would not form 
part of this Panel's terms of reference. 
7.1453  Accordingly, only the requirements described in  the 17 bullet points in New Zealand's panel 
request identify the measures at issu e with sufficient precision.  The question before the Panel is then 
whether the 17 specific requirements at issue can violate Annex C(1)(a) of the SPS Agreement, or 
alternatively, whether the measure that could allege dly infringe Annex C(1)(a) is different from these 
17 specific requirements, and hence not properly identif ied in New Zealand's panel request.  This calls 
for a closer look at Annex C(1)(a). 
7.1454  Annex C(1)(a) of the SPS Agreemen t provides in relevant part: 
"1. Members shall ensure, with respect to  any procedure to check and ensure the 
fulfilment of sanitary and phytosanitary measures, that: 
(a) such procedures are undertaken and completed without undue delay 
..." 
7.1455  As Australia suggests
3292, an ordinary reading of this provision – according to its structure and 
wording, in particular the use of the word "s uch" – allows it to be rephrased as follows:  Members 
shall ensure that any procedure to check and en sure the fulfilment of sanitary and phytosanitary 
measures is undertaken and co mpleted without undue delay . 
7.1456  All obligations in the WTO covered agreements re late to measures.  In fact, only one or more 
measures, i.e. an "act or omission attributable to a WTO Member"3293, can be said to violate an 
obligation contained in a covered agreement.  This applies also to Annex C(1)(a) of the 
SPS Agreement. 
7.1457  To bring a specific measure within the scope  of WTO dispute settlement, the complainant 
needs to identify it in the panel request.  Article 6. 2 of the DSU provides that "[t]he request for the 
establishment of a panel ... shall ... identify the speci fic measures at issue and provide a brief summary 
of the legal basis of the complaint sufficient to present the problem clearly."  As Australia points 
out3294, in EC – Selected Customs Matters  the Appellate Body held on the first of these requirements 
under Article 6.2 that "[t]he 'specific measure' to be  identified in a panel request is the object of the 
challenge, namely, the measure that is alleged to be  causing the violation of an obligation contained in 
a covered agreement.  In other words, the measure at issue is what is being challenged by the 
complaining Member."3295 
7.1458  The Appellate Body continued, distinguishing the other requirement under Article 6.2 of the 
DSU as follows: 
"In contrast, the legal basis of the compla int, namely, the 'claim' pertains to the 
specific provision of the covered agreement th at contains the obligation alleged to be 
violated.  A brief summary of the legal basi s of the complaint required by Article 6.2 
                                                      
3292 Australia's reply to Panel question 144 after the first substantive meeting and Australia's second 
written submission, para. 191. 
3293 Appellate Body Report on US – Corrosion-Resistant Steel Sunset Review , para. 81. 
3294 Australia's second written submission, para. 199.  See also, Australia's second written submission, 
para. 201. 
3295 Appellate Body Report on EC – Selected Customs Matters , para. 130 (original emphasis).  WT/DS367/R 
 Page 541 
 
 
 of the DSU aims to explain succinctly how or why the measure at issue is considered 
by the complaining Member to be violating the WTO obligation in question.  This brief summary must be sufficient to present the problem clearly.  Taken together, these different aspects of a panel request serve not only to define the scope 
of a dispute, but also to meet the due process requirements."
3296 
7.1459  As to the specific measure that New Zealand was supposed to identify in its panel request, 
what does New Zealand challenge under Annex C(1)(a)?  What , according to New Zealand, causes 
the violation of Annex C(1)(a)?  In New Zealand' s own words, that "the 17 measures ... at issue ... 
were not developed and adopt ed without undue delay."3297  In other words, New Zealand contests 
what it sees as the unjustifiably delayed development and adoption of the 17 SPS measures at issue.  
In order to cover that, Annex C(1)(a) needs to relate to the developm ent and approval of SPS 
measures.  Invoking Article 1.1 of the SPS Agre ement, New Zealand argues that that is the case.3298 
7.1460  In the part of the SPS Agreement entitled "Gen eral Provisions", Article 1.1 provides that: 
"This Agreement applies to all sanitary and phytosanitary measures which may, 
directly or indirectly, affect internationa l trade.  Such measures shall be developed 
and applied in accordance with the provisions of this Agreement." 
7.1461  Based on the second sentence of Article 1.1,  undoubtedly, the SPS Agreement establishes 
obligations regarding the developm ent and application of SPS measur es that may affect international 
trade.  Based on the same sentence, however, the SPS Agreement covers the development and 
application of SPS measures "in accordance with [its] provisions", i.e. only to the extent that the 
specific provisions of the Agreement relate to the development or application of SPS measures. 
7.1462  Therefore, the question is whether Annex C(1)(a ) of the SPS Agreement can be interpreted as 
applying to the development of SPS measures – in particular, the development of the 17 measures at 
issue in this dispute.  Australia disagrees, arguing that Annex C(1)(a) applies to "procedures to check 
and ensure the fulfilment of SPS measures", and that  such procedures can n ecessarily only follow in 
time the SPS measures that they check and ensure.3299 
7.1463  The Panel has a more nuanced reading of Annex C( 1)(a) of the SPS Agreement in that regard.  
The text of Annex C(1)(a) relates to "procedures to check and ensure  the fulfilment of SPS measures", 
not to develop SPS measures (emphasis added).  However, unde r the definition of Annex A(1) of the 
SPS Agreement, SPS measures include both substantive requirements and procedures.  Therefore, the 
"SPS measure" referenced in the language of A nnex 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.  In that case, the actual import risk assessment conducted for a specific good 
might constitute the procedure to check and en sure the fulfilment of this "SPS measure". 
7.1464  Indeed, in EC – Approval and Marketing of Biotech Products the panel found that: 
"[T]he term 'requirements' as it appears in the second paragraph of Annex A(1) is 
unqualified and thus is applicable both to re quirements which are generally applicable 
                                                      
3296 Appellate Body Report on EC – Selected Customs Matters , para. 130 (original emphasis). 
3297 New Zealand's reply to Panel question 143 afte r the first substantive meeting, para. 298. 
3298 New Zealand's opening oral statement at the first substantive meeting of the Panel with the Parties, 
para. 130. 
3299 Australia's reply to Panel question 144 after the first substantive meeting and Australia's second 
written submission, paras 195-196. WT/DS367/R 
Page 542  
 
 and to requirements which have been imposed on specific products.
3300  In our view, 
the application of a generally applicable  SPS 'requirement' (e.g., a pre-marketing 
approval requirement for biotech products) to a specific product may result in a different, product-specific SPS 'requirement ' (e.g., a ban on the marketing of a 
specific biotech product).  In other words,  there may be cases where the application 
of an SPS 'requirement' and, hence, of an SPS measure, may give rise to a new SPS 
requirement and, hence, a new SPS measure."
3301 
7.1465  In other words, if unduly delayed, an SPS approval procedure like the IRA process might  
infringe Annex C(1)(a) of the SPS Agreement.  The Panel finds support for this interpretation in the 
context of Annex C(1)(a).  As indicated in its title, Annex C applies to "[c]ontrol, inspection and 
approval procedures".  Also, Article 8 prescribes Members' compliance with Annex C "in the 
operation of control, inspection and approval pro cedures, including national systems for approving the 
use of additives or for establishing tolerances for c ontaminants in foods, beverages or feedstuffs."  
In EC – Approval and Marketing of Biotech Products the panel interpreted the language "procedures 
to check and ensure the fulfilment of [SPS] m easures" in Annex C(1)(a) to apply to approval 
procedures, by interpreting the first clause of Annex C(1)(a) "essentially as a good faith obligation 
requiring Members to proceed with their approval procedures as promptly as possible, taking account 
of the need to check and ensure the fulf ilment of their relevant SPS requirements."3302 
7.1466  Finding that under specific circumstances Annex C(1)(a) of the SPS Agreement might apply 
to an approval process leading to the development of substantive SPS measures is only half of the 
analysis the Panel needs to conduct here.  The othe r half is whether New Zealand has properly called 
this into question in this dispute.  The answer to  this latter question turns on whether in this case 
New Zealand should have identified in its panel request an additional measure separate from the 
17 specific requirements. 
7.1467  The Panel recalls the words of the Appellate Body in EC – Selected Customs Matters , 
according to which "[t]he 'specific measure' to be identified in a panel request is the object of the 
challenge, namely, the measure that is alleged to be  causing the violation of an obligation contained in 
a covered agreement.  In other words, the measure at issue is what is being challenged by the 
complaining Member."3303 
7.1468  Reading this and keeping the specific context of  the present dispute in mind, it is clear that 
under its Annex C(1)(a) claim New Zealand is not challenging the content of the 17 requirements as 
such.  Rather, it is the procedur e leading to the adoption of these 17 requirements, and more precisely 
the alleged delay in this procedure that in New Zealand's view violates Annex C(1)(a).  Or, in 
New Zealand's words, the "development" of these 17 measures. 
7.1469  As noted above, the development of the 17 measu res, and particularly any alleged delays 
involved, might be covered by Annex C(1)(a) of  the SPS Agreement.  From the viewpoint of 
identifying the measure that infringes that provision, however, the 17 requirements and their 
development are separate measures.  Accordingly, in  the context of its Article 8 and Annex C(1)(a) 
claim, New Zealand should have done more in its panel request than merely identify the 
17 requirements set out in the IRA. 
                                                      
3300 (footnote original ) We note in this respect that the fo otnote to Annex B(1) defines "[SPS] 
regulations" as "[SPS] measures ... which ar e applicable generally".  It follows, a contrario , that there can be 
SPS measures which are not applicable generally. 
3301 Panel Report on EC – Approval and Marketing of Biotech Products , para. 7.1336. 
3302 Panel Report on EC – Approval and Marketing of Biotech Products , para. 7.1498. 
3303 Appellate Body Report on EC – Selected Customs Matters , para. 130 (original emphasis).  WT/DS367/R 
 Page 543 
 
 
 7.1470  Annex C(1)(a) applies to procedures.  This is clear from both subparagraph (a) 
("such procedures") and from the chapeau of Annex C(1) ("procedures to check and ensure ...").  
Further, as mentioned above, Annex C and Article 8 also apply to procedures, namely "control, 
inspection and approval procedures".  These procedures might be measures in their own right;  they may even qualify as SPS measures.  Indeed, the definition of SPS measures in Annex A(1) of the 
SPS Agreement provides that "[s]anitary or phytosanita ry measures include all relevant ... procedures, 
including inter alia ... testing, inspection, certification a nd approval procedures, [and] sampling 
procedures."  Likewise, the footnote to the title of  Annex C provides that "[c]ontrol inspection and 
approval procedures include, inter alia , procedures for sampling, testing and certification."  As the 
panel in EC – Approval and Marketing of Biotech Products  held, "Annex C(1)(a), first clause, 
establishes disciplines concerning the 'enfor cement' of SPS measures, namely, approval 
procedures."
3304 
7.1471  As the Panel recognized above, each of the 16 measures at issue in this dispute might also 
involve a procedure.3305  New Zealand, however, does not argue that these procedures infringe 
Annex C(1)(a) or Article 8.  Rath er, New Zealand contests the way in which the 17 requirements were 
developed. 
7.1472  It is perfectly plausible that an unduly dela yed specific approval process is found inconsistent 
with Annex C(1)(a) (and consequently Article 8) of  the SPS Agreement, even if that process does not 
lead to the adoption of substantive SPS requirements.  To a certain extent, this is what happened in the 
EC – Approval and Marketing of Biotech Products dispute.  As Australia points out3306, the IRA 
process was not necessarily supposed to lead to subs tantive SPS requirements concerning the pests at 
issue in the current dispute, and it would not have  been appropriate for Australia to conduct its IRA 
process with preconceived measures in mind.  Accordi ngly, the Panel can imagine situations where an 
approval process simply takes too long for the compla inant, especially if the complainant is prevented 
from exporting the goods in question during that period.  In such circumstances, it would be inappropriate if the complainant were prevente d from initiating a WTO dispute merely because the 
lengthy approval process did not lead to substan tive SPS requirements.  A different interpretation 
would empty out the procedural requirement containe d in the first clause of Annex C(1)(a) of the 
SPS Agreement. 
7.1473  In its preliminary ruling, the Panel limited this dispute to the 17 specific requirements 
identified in bullet points in New Zealand's panel requ est.  Subsequently, in an earlier section of this 
report, the Panel has found that each of the 16 ou t of the 17 requirements that remain within the 
purview of this dispute following the Parties' ag reed understanding on Measure 12 not being imposed 
by Australia, constitutes an SPS measure on its own.
3307  In the light of the text of New Zealand's 
panel request, however, these findings are necessarily limited to the requirements in question as they 
are contained in the IRA.  The findings do not cove r the separate issue of the procedure through which 
the requirements were developed in the IRA process. 
7.1474  Accordingly, the Panel agrees with Australia th at New Zealand has not properly identified the 
measure at issue in its panel request in the context of its Annex C(1)(a) and Article 8 claim.  In fact, in its panel request New Zealand identified the 17 s ubstantive requirements contained in the IRA.  
New Zealand did not identify any aspects of what exactly might have caused the infringement of 
Annex C(1)(a) (and consequently Article 8) , nor did it provide a brief summary of why and how these 
provisions could be infringed by the 17 specific requirements at issue. 
                                                     
 
3304 Panel Report on EC – Approval and Marketing of Biotech Products , para. 7.1499. 
3305 See para. 7.163 above. 
3306 Australia's second written submission, para. 209. 
3307 See para. 7.172 above. WT/DS367/R 
Page 544  
 
 7.1475  It is difficult to tell in the abstract what ki nd of precise language would have been appropriate 
for New Zealand to use.  The Panel sees various  possible approaches, although in the absence of 
specific language it is difficult to say with certa inty whether these would eventually satisfy the 
requirements of Article 6.2 of the DSU.  Indeed, th e sufficiency of a panel request in the context of 
Article 6.2 requires a case-by-case analysis, "consider [ing] the panel request as a whole, and in the 
light of attendant circumstances."
3308  In any event, in general the Panel could have imagined 
New Zealand's panel request adopting one of the following alternative approaches.  New Zealand 
could have referred to the development of the 17 m easures (the IRA process) and could have claimed 
that that process violated Annex C(1)(a) and Ar ticle 8 because of undue delays.  Or New Zealand 
could have referred to the delays in the IRA process claiming that th ese have violated Annex C(1)(a) 
and Article 8.  Or, to use the language of Annex C(1)(a), New Zealand could have claimed that undue 
delays in completing the IRA process infringed A nnex C(1)(a) and Article 8.  Alternatively, 
New Zealand could have identified specific acts or om issions attributable to Australia that resulted in 
undue delay in the IRA process, and claim that the se acts or omissions violated Annex C(1)(a) and 
Article 8. 
7.1476  New Zealand's panel request offered none of these explanations.  As Australia points out3309, 
this is in stark contrast with the panel requests in the EC – Approval and Marketing of Biotech 
Products dispute, which explicitly referenced the legisl ative instruments containing the EC's general 
approval regime, and identified as the measures at issu e (i) the suspension of the consideration of, and 
the failure to consider or appr ove, various applications for appr oval of agricultural biotechnology 
products;  and (ii) the general suspension of such c onsiderations or undue delays in finalizing such 
considerations under the EC's  general approval regime.3310 
7.1477  In the light of the above, New Zealand's Anne x C(1)(a) claim and its consequential claim 
under Article 8 of the SPS Agreement are outside of th e Panel's terms of reference in this dispute.  
The Panel will therefore refrain from assessing the substance of New Zealand's claims under these 
provisions. 
7.1478  Before concluding its analysis under these provi sions, the Panel will address the issue of 
whether New Zealand could have challenged the IR A process, and the delays in that process, 
following the completion of the IRA process, i.e. even  if that process had ceased to exist before the 
Panel's establishment.  Both Parties have raised th is issue.  It is important to address it because the 
Panel's consideration of the arguments relating to Annex C(1)(a) and Article 8 is predicated on the 
view that this would have been possible – for the following reasons. 
7.1479  The first clause of Annex C(1)(a) provides that "such procedures are undertaken and 
completed without undue delay" (emphasis added).  In EC – Approval and Marketing of Biotech 
Products  the panel attached equal importance to both the words "undertaken" and "completed" within 
that phrase: 
"The verb 'undertake' makes clear that Me mbers are required to begin, or start, 
approval procedures after receiving an application for approval.3311  T h e  v e r b  
                                                      
3308 Appellate Body Report on US – Carbon Steel, para. 127. 
3309 Australia's second written submission, para. 206. 
3310 See, EC – Approval and Marketing of Biotech Products , Request for the Establishment of a Panel 
by the United States (WT/DS291/23), 8 August 2003;  EC – Approval and Marketing of Biotech Products , 
Request for the Establishment of a Panel by Canada, (WT/DS292/17), 8 August 2003;  EC – Approval and 
Marketing of Biotech Products , Request for the Establishment of a Panel by Argentina (WT/DS293/17), 
8 August 2003. 
3311 (footnote original ) The dictionary meanings of the verb "undertake" include "[t]ake on 
(an obligation, duty, task, etc.); commit oneself to pe rform; begin (an undertaking, enterprise, etc.)".  The New 
Shorter Oxford English Dictionary , L. Brown (ed.) (Clarendon Press, 1993), Vol. II, p. 3476.  The French and  WT/DS367/R 
 Page 545 
 
 
 'complete', on the other hand, indicates that approval procedures are not only to be 
undertaken, but are also to be finished, or concluded.3312  Thus, in our view, the 
phrase 'undertake and complete' covers all stages of approval procedures and should 
be taken as meaning that, once an applicati on has been received, approval procedures 
must be started and then carried out from beginning to end."3313 
7.1480  Australia argues3314, and New Zealand does not contest, that the IRA process could have been 
challenged under Annex C(1)(a) and Artic le 8 before it was concluded.  The Panel agrees with that in 
principle.  A relevant measure that is in force at  the time of panel establis hment might be challenged 
in WTO dispute settlement.  As the EC – Approval and Marketing of Biotech Products dispute 
showed, an ongoing – although delayed, because suspended – SPS approval process is no exception. 
7.1481  But, as the panel in the same dispute explaine d, Annex C(1)(a) applies to all stages of an 
approval process, from beginning to end.  In part icular, Annex C(1)(a) applies not only to the 
"undertak[ing]" but also to the "complet[ion]" of approval processes. 
7.1482  Common sense dictates that the completion of an approval process shall be open to challenge 
under WTO dispute settlement after the completion has taken place.  In fact, a potential complainant 
might have indications of an approval process not being undertaken without undue delay already in 
the course of the approval process.  However, th e full picture on the approval process not being 
completed without undue delay becomes clear for th e complainant only after the approval process has 
been effectively completed. 
7.1483  Not allowing completion of an approval pr ocess to be challenged under Annex C(1)(a) 
precisely because the process has "ce ased to exist" when it was co mpleted would read the term 
"complete" out of Annex C(1)(a).  Also, it would defeat basic objectives of WTO dispute settlement 
under the DSU:  the preservation of the rights and obligations of Members under the covered agreements
3315, and the effective resolution of disputes.3316 
7.1484  This applies in particular when a potential complainant considers challenging not only the 
approval process but also any substantive SPS require ments resulting from such process.  Of course, 
a Member could initiate two disputes:  one agai nst the approval process during the course of that 
process, and another one against the resulting SPS re quirements.  Alternatively, a complainant may 
raise these matters in one single dispute.  This is  the case in particular when the complainant has a 
potentially more pressing concern with the SPS requi rements resulting from the approval process than 
with the undue delay in the approval process.  By  definition, such a dis pute can be launched only 
when the resulting SPS requirements are in plac e, and the approval process leading to those 
requirements has been already completed. 
                                                                                                                                                                     
Spanish versions of Annex C(1)(a), first clause, also support this reading.  The French version uses the verb 
"engager", the Spanish version the verb "iniciar".  We al so note that Annex C(1)(b) requires Members to ensure, 
inter alia , that "when receiving an application, the competen t body promptly examines the completeness of the 
documentation and informs the applicant in  a precise and complete manner of all deficiencies".  Thus, it is clear 
that approval procedures are "undertaken" upon  receipt of an application from an applicant. 
3312 (footnote original ) The dictionary meanings of the verb "complete" include "[b]ring to an end, 
finish, conclude".  The New Shorter Oxford English Dictionary , L. Brown (ed.) (Clarendon Press, 1993), Vol. I, 
p. 460.  The French and Spanish versions of Annex C(1)(a ), first clause, also support this reading.  The French 
version uses the verb "achever", the Spanish version the verb "ultimar". 
3313 Panel Report on EC – Approval and Marketing of Biotech Products , para. 7.1494. 
3314 Australia's reply to Panel question 129 after th e second substantive meeting, paras. 546-550. 
3315 See Article 3.2 of the DSU. 
3316 See Article 21.1 of the DSU. WT/DS367/R 
Page 546  
 
 7.1485  The Panel finds support in previous jurispruden ce for the possibility of a complainant filing a 
single complaint.  In general, a WTO dispute settleme nt procedure starts with the complainant filing a 
request for consultations.  The Appellate Body held in US – Upland Cotton  that consultations "must 
pertain to 'measures affecting the ope ration of any covered agreement'"
3317, i.e. measures "whose 
effects are alleged to be impairing the benefits  accruing to the requesting Member under a covered 
agreement"3318 at present.  The Appellate Body explicitly found that "[w]hether or not a measure is 
still in force is not dispositive of whether that measure is currently affecting the operation of any 
covered agreement."3319 
7.1486  Using the same logic, an alleged undue dela y in a completed approval process that might 
continue to impair benefits accruing to the comp lainant under Annex C(1)(a) of the SPS Agreement 
should not be excluded from WTO dispute settlement me rely because the process has been completed.  
This is particularly the case when the complainan t was prevented from exporting the goods subject to 
the approval process during that time, and the compla inant continues to feel jeopardized from starting 
its exports in the light of the SPS requirements resulting from the approval process. 
7.1487  The Panel notes that in US – Upland Cotton the Appellate Body found contextual support in 
Article 3.3 of the DSU for its above-cited arguments: 
"Article 3.3 focuses not upon 'existing' measu res, or measures that are 'currently in 
force' but, rather, upon 'measures taken' by  a Member, which includes measures taken 
in the past.  We also observe that Arti cle 3.3 envisages that disputes arise when a 
Member 'considers' that benefits accruing to  it are being impaired by measures taken 
by another Member.  By using the word 'considers', Article 3.3 focuses on the 
perception or understanding of an aggrieve d Member.  This does not exclude the 
possibility that a Member requesting consulta tions may have reason to believe that a 
measure is still impairing benefits even though its legislative basis has expired."3320 
7.1488  The Panel is cognizant that in EC – Chicken Cuts  the Appellate Body found in regard to 
requests for panel establishment that "[t]he term 's pecific measures at issue' in Article 6.2 suggests 
that, as a general rule, the measures included in a panel's terms of reference must be measures that are 
in existence at the time of the establishment of the panel.3321"3322  As Australia argues3323, however, 
the Appellate Body introduced its statement with th e words "as a general rule", suggesting that there 
might be exceptions to this general rule.  Subsequently, in EC – Selected Customs Matters  the 
Appellate Body interpreted its statement  in EC – Chicken Cuts  as a "general rule ... qualified by 
at least  two exceptions."3324  This not only confirmed that ther e are exceptions to the general rule, 
but implied that the exceptions are not necessarily li mited to the two identified by the Appellate Body 
in its earlier jurisprudence.  In fact, in the same paragraph of its report in EC – Selected Customs 
Matters3325 the Appellate Body also upheld the following finding by the panel: 
                                                      
3317 Appellate Body Report on US – Upland Cotton , para. 260. 
3318 Appellate Body Report on US – Upland Cotton , para. 263. 
3319 Appellate Body Report on US – Upland Cotton , para. 262. 
3320 Appellate Body Report on US – Upland Cotton , para. 264. 
3321 (footnote original ) These measures should also have been the subject of consultations prior to the 
establishment of the panel, although the Appellate Body has held that there is no need for a " precise and exact 
identity " between the measures addressed in consultations and the measures identified in the panel request. 
(Appellate Body Report, Brazil – Aircraft , para. 132) (original emphasis) 
3322 Appellate Body Report on EC – Chicken Cuts , para. 156. 
3323 Australia's reply to Panel question 129 after th e second substantive meeting, paras. 546-550. 
3324 Appellate Body Report on EC – Selected Customs Matters , para. 184 (emphasis added). 
3325 Ibid.  WT/DS367/R 
 Page 547 
 
 
 "We understand that, as a general principle, a panel is competent to make findings 
and recommendations on measures in existence at the time of establishment of the 
panel, assuming that the request for establishment of a panel covers those measures.  Nevertheless, a panel may also be co mpetent to make findings and make 
recommendations on measures that have expired or are not yet in existence at the 
time of establishment, assuming again that the request covers those measures.  
More specifically, we understand that, to the extent that expired measures affect the 
operation of a covered agreement at the time  of establishment of a panel, they may 
properly be the subject of findings and reco mmendations by a panel, particularly if 
such findings and recommendations are n ecessary to secure a positive solution to the 
dispute.
3326"3327 
7.1489  Accordingly, the Panel concludes that in the cu rrent dispute, in principle, New Zealand could 
have challenged the IRA process, and the alleged undue delays in that process, even though that 
process had already been completed by the time the Panel was established. 
7.1490  However, this remains a mere possibility in this dispute.  As explained above, since 
New Zealand has not effectively identified the meas ure at issue in the context of its Annex C(1)(a) 
and Article 8 claims, these measures and the claims to which they relate are outside the scope of this 
dispute.  As the Appellate Body noted in Dominican Republic – Import and Sale of Cigarettes , "[t]he 
Appellate Body has consistently maintained that, where a panel request fails to identify adequately 
particular measures or fails to specify a particular claim, then such measures or claims will not form 
part of the matter covered by th e panel's terms of reference."3328 
VIII.  CONCLUSIONS AND RECOMMENDATION 
8.1 For the reasons indicated in this report, the Panel has found that: 
(a) There is no evidence that the process of selection and consultation of experts was 
conducted 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; 
(b) The 16 measures at issue in the current dispute, both as a whole and individually, 
constitute SPS measures within the meaning of Annex A(1) and are covered by the 
SPS Agreement; 
(c) Australia's measures at issue regarding fi re 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; 
(d) New Zealand has failed to demonstrate that the measures at issue in the current 
dispute are inconsistent with Article 5.5 of the SPS Agreement and, consequentially, 
has also failed to demonstrate that these meas ures are inconsistent with Article 2.3 of 
the SPS Agreement; 
                                                     
 
3326 (footnote original ) See, Appellate Body Report, US – Upland Cotton , para. 261;  Appellate Body 
Report, Chile – Price Band System , paras. 126-144;  Appellate Body Report, EC – Chicken Cuts , para. 156. 
3327 Panel Report on EC – Selected Customs Matters , para. 7.36. 
3328 Appellate Body Report on Dominican Republic – Import and Sale of Cigarettes , para. 120. WT/DS367/R 
Page 548  
 
 (e) Australia's measures at issue regarding fi re blight, European canker and ALCM, are 
inconsistent with Article 5.6 of the S PS 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;  and, 
(f) New Zealand's claim under Annex C(1)(a) cl aim and its consequential claim under 
Article 8 of the SPS Agreement are outside of  the Panel's terms of reference in this 
dispute. 
8.2 Under Article 3.8 of the DSU, in cases where there is an infringement of the obligations 
assumed under a covered agreement, the action is considered prima facie to constitute a case of 
nullification or impairment.  The Panel concludes that , to the extent that Australia's measures at issue 
regarding fire blight, European canker and ALCM, as well as the requirements identified by 
New Zealand as "general" measures that are linked to a ll three pests at issue in the present dispute, are 
inconsistent with the SPS Agreement, they have  nullified or impaired benefits accruing to 
New Zealand under the WTO Agreements. 
8.3 The Panel recommends that the Dispute Settleme nt Body request Australia to bring the 
inconsistent measures as listed a bove into conformity with its obl igations under the SPS Agreement. 
 
_______________ 
 
  WT/DS367/R 
 Page A-1 
 
 
 ANNEX A 
 
 
CONTENTS Page 
Annex A-1 Request for the Establis hment of a Panel (WT/DS367/5) A-2 
Annex A-2 Communication from the Chairman of the Panel:  Preliminary Ruling 
by the Panel (WT/DS367/7) A-5 
Annex A-3 Working Procedures for the Panel, adopted on 26 March 2008 A-9 
Annex A-4 Procedures for the Panel's fi rst substantive meeting, adopted on 
4 August 2008 A-13 
Annex A-5 Procedures for the Panel's meeti ng with the experts and Parties and the 
Panel's second substantive m eeting, adopted on 11 June 2009 A-17 
 
 
_______________ 
 
 WT/DS367/R 
Page A-2  
 
 ANNEX A-1 
 
 
 
WORLD TRADE  
ORGANIZATION  WT/DS367/5 
7 December 2007 
 
 (07-5456) 
 Original:   English 
  
 
AUSTRALIA – MEASURES AFFECTING THE IMPORTATION OF APPLES 
FROM NEW ZEALAND 
 
Request for the Establishment of a Panel by New Zealand
 
 
  The following communication, dated 6 Decemb er 2007, from the delegation of New Zealand 
to the Chairman of the Dispute Settlement Body, is  circulated pursuant to Article 6.2 of the DSU. 
 
_______________ 
 
 On 27 March 2007, the Australian Director of  Animal and Plant Quarantine determined a 
policy for the importation of apples from New Zeal and:  "Importation of apples can be permitted 
subject to the Quarantine Act 1908 , and the application of phytosanitary measures as specified in the 
Final import risk analysis report for apples from New Zealand , November 2006".
1 
 
 New Zealand considers that the measures specifi ed in and required by Australia pursuant to 
the Final import risk analysis report for apples from New Zealand  are inconsistent with the 
obligations of Australia under the Agreement on the Application of Sanitary and Phytosanitary 
Measures  ("SPS Agreement"). 
 
 In particular, New Zealand considers that the following measures are, both individually and as 
a whole, inconsistent with the obligati ons of Australia under the SPS Agreement: 
 Fire blight
 
 
• The requirement that apples be sourced from areas free from fire blight disease 
symptoms.  
• The requirement that orchards/blocks be inspected for fire blight disease symptoms, 
including that they be inspected at an inspection intensity that would, at a 95% 
confidence level, detect visual symptoms if  shown by 1% of the trees, and that such 
inspections take place between 4 to 7 weeks after flowering. 
• The requirement that an orchard/block inspection methodology be developed and 
approved that addresses issues such as visibility of symptoms in the tops of trees, the 
                                                      
1 Biosecurity Australia Policy Memorandum 2007/07, 27 March 2007.  WT/DS367/R 
 Page A-3 
 
 
 inspection time needed and the number of trees to be inspected to meet the efficacy level, 
and training and certification of inspectors. 
• The requirement that an orchard/block 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.   
• The requirement that an orchard/block be suspended for the season on the basis of 
detection of any visual symptoms of fire blight. 
• The requirement that apples be subject to di sinfection treatment in the packing house. 
• The requirement that all grading and packing e quipment that comes in direct contact with 
apples be cleaned and disinfected (using an approved disinfectant) immediately before 
each Australian packing run.  
• The requirement that packing houses registered for export of apples process only fruit 
sourced from registered orchards. 
European canker  
 
• The requirement that apples be sourced fro m export orchards/blocks free of European 
canker (pest free places of production). 
• The requirement that all trees in export orch ards/blocks be inspected for symptoms of 
European canker, including that orchards/b locks in areas less conducive for disease are 
inspected for symptoms by walking down ever y row and visually examining all trees on 
both sides of each row, and that areas more  conducive to the disease are inspected 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.   
• The requirement that all new planting stock be intensively examined and treated for 
European canker. 
• The requirement that an orchard/block 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.   
• The requirement that exports from an orch ard/block be suspended for the coming season 
on the basis of detection of European ca nker and that reinstatement would require 
eradication of the disease, confirmed by inspection. 
Apple leafcurling midge  
 
• The requirements of inspection and treatment for apple leafcurling midge, including: 
the option of inspection of each lot on the b asis of a 3000 unit sample selected at random 
across the whole lot for apple leafcurling midge, symptoms of quarantineable diseases, 
quarantineable pests, arthropods, trash and weed seeds, with detection of any live 
quarantineable arthropod resulting in appropria te treatment or rejection for export;   WT/DS367/R 
Page A-4  
 
 the option of inspection of each lot on the basis of a 600 unit sample selected at random 
across the whole lot for symptoms of quarantin eable diseases, trash and weed seeds, plus 
mandatory appropriate treatment of all lots. 
General
 
 
• The requirement that Australian Quarantine and Inspection Service officers be involved 
in orchard inspections for European canker a nd fire blight, in direct verification of 
packing house procedures, and in fruit inspection and treatment.   
• The requirement that New Zealand ensure th at all orchards registered for export to 
Australia operate under sta ndard commercial practices. 
• The requirement that packing houses provid e details of the layout of premises.  
 New Zealand considers that the above measure s are inconsistent with the obligations of 
Australia under Articles 2.2, 2.3 (both sentences), 5.1, 5.2, 5.5 (first sentence), 5.6 and 8 (in relation to 
Annex C) and Annex C(1)(a) of the SPS Agreement. 
  On 31 August 2007, New Zealand requested cons ultations with Australia regarding the above 
measures pursuant to Article XXII of the General Agreement on Tariffs and Trade 1994 , Article 4 of 
the Understanding on Rules and Procedures Governing the Settlement of Disputes  ("DSU"), and 
Article 11 of the SPS Agreement.  In accordance with Article 4 of the DSU the request was notified to 
the Dispute Settlement Body ("DSB"), the Counc il for Trade in Goods, and the Committee on 
Sanitary and Phytosanitary Measures.  The request  was circulated to members of the World Trade 
Organization on 4 September 2007 (WT/DS367/1).  Australia accepted New Zealand's request and 
consultations were held on 4 Oc tober 2007 in Geneva.  However, th e consultations have failed to 
resolve the matter. 
  Accordingly, New Zealand respectfully requ ests the DSB to establish a panel pursuant to 
Article 6 of the DSU, with standard terms of reference as set out in Article 7.1 of the DSU. 
  I would be grateful if you would place this item on the agenda for the next DSB meeting on 
17 December 2007 and circulate this request to Members. 
 
 
_______________ 
   WT/DS367/R 
 Page A-5 
 
 
 ANNEX A-2 
 
 
 WORLD TRADE  
ORGANIZATION  WT/DS367/7 
23 June 2008 
 
 (08-2984) 
 Original:   English 
  
 
AUSTRALIA – MEASURES AFFECTING THE IMPORTATION OF APPLES 
FROM NEW ZEALAND 
 
Communication from the Chairman of the Panel
 
 
Preliminary Ruling by the Panel 
 
 
 The following communication, dated 19 June 2008, from the Chairman of the Panel to the 
Chairman of the Dispute Settlement Body, is ci rculated to Members for their information. 
 
_______________ 
 
  On 13 March 2008, Australia, the respondent in the above-mentioned dispute, raised a 
preliminary procedural question concerning the consistency of New Zealand's request for the 
establishment of the Panel (WT/DS367/5) with Artic le 6.2 of the Dispute Settlement Understanding. 
  Over the past months, the Panel has received  written submissions on this preliminary issue 
from both parties as well as from two third parties.  On 6 June 2008, the Panel issued the enclosed preliminary ruling on the procedural question raised by Australia, reserving its right to further develop 
the reasons for its preliminary ruling later in the proceedings or to include them in its report, as 
appropriate.   After having consulted the parties to the disput e, the Panel has decided to inform the Dispute 
Settlement Body of the content of its preliminary ru ling.  Therefore, I would be grateful if you could 
circulate the body of this letter and the enclosed preliminary ruling as a WT/DS367 document in all 
three official languages of the WTO at the same time.   Circulation of the preliminary ruling as a sep arate document in the WT/DS series was decided 
because of the specific circumstances of the case before  this Panel and in the light of the outcome of 
the preliminary ruling.  Accordingly, it should not be seen as establishing a practice or setting a 
precedent for the circulation of preliminary rulings in any other dispute.    WT/DS367/R 
Page A-6  
 
 PRELIMINARY RULING OF THE PANEL 
 
6 June 2008
 
 
 I. INTRODUCTION 
1. On 13 March 2008, Australia filed a request be fore this Panel for a preliminary procedural 
ruling.  Australia asserted that New Zealand's re quest for the establishment of this Panel, dated 
7 December 2007, is inconsistent with Article 6.2 of the Disput e Settlement Understanding (DSU), 
because the panel request fails to identify the specific measures at issue and fails to provide a brief 
summary of the legal basis of New Zealand's complaint sufficient to present the problem clearly.  
Australia asked the Panel to find that New Zealand' s panel request fails to fulfil the requirements of 
Article 6.2 of the DSU, and therefore to refrain  from considering the substance of New Zealand's 
claims in this dispute.
1 
 
2. The Panel has examined Australia's prelim inary request, as well as the arguments presented 
subsequently by Australia and New Zealand, a nd by Chile and the European Communities as third 
parties to the dispute.  In considering Australia 's request, the Panel has looked at New Zealand's 
request for the establishment of the Panel as a w hole and on its face, as well as the attendant 
circumstances of the present case.  The Panel assessed the sufficiency of this panel request in the light 
of the terms used in Article 6.2 of the DSU in th eir context and in the light of the object and purpose 
of this provision. 
 3. In the interest of due process, and especia lly in order to allow parties and third parties 
sufficient time to prepare their first written submis sions, the Panel has decided to issue an early 
preliminary ruling.  This is consistent with Aust ralia's request that the Panel issue its preliminary 
ruling prior to the due dates of the parties' first written submissions.
2  The Panel reserves its right to 
further develop the reasons for its ruling later in th e proceedings, or to include them in its report. 
 4. The Panel begins by recalling the requirements contained in Article 6.2 of the DSU.  These 
requirements are as follows:  
"The request for the establishment of a pane l shall be made in writing.  It shall 
indicate whether consultations were held, identify the specific measures at issue and 
provide a brief summary of the legal basis of the complaint sufficient to present the 
problem clearly.  In case the applicant re quests the establishment of a panel with 
other than standard terms of reference, th e written request shall include the proposed 
text of special terms of reference." 
5. The Panel notes that New Zealand's panel request clearly satisfies the first two requirements 
contained in Article 6.2 of the DSU.  In this regard, the panel request was made in writing and 
indicates that "consultations [between the parties]  were held on 4 October 2007 in Geneva ... [but 
they] failed to resolve the matter".
3  Indeed, neither Australia nor the third parties have raised any 
issue with regard to these particular two require ments.  The Panel will now turn to whether New 
Zealand's panel request satisfies the other requirements of Article 6.2. 
                                                      
1 Australia's letter dated 13 March 2008. 
2 Australia's letter dated 17 March 2008. 
3Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, p. 3.  WT/DS367/R 
 Page A-7 
 
 
 II. ON THE IDENTIFICATION OF THE SPECIFIC MEASURES AT ISSUE 
6. As to whether New Zealand's panel request identifies the specific me asures at issue in a 
manner consistent with the requirements of Artic le 6.2 of the DSU, the Panel has reached the 
conclusions set forth below.  
7. In its panel request, New Zealand has referred to both "measures specified in and required by 
Australia pursuant to the Final import risk analysis report for apples from New Zealand " (FIRA ) and, 
"in particular" to a list of 17 requirements spelt out in the FIRA  and identified in the panel request 
through bullet points.  
8. Looking at the text of New Zealand's panel re quest, the Panel finds that, with respect to the 17 
items identified by New Zealand through 17 separate bullet points, the request is sufficiently precise 
in identifying the specific measures at issue with respect to those 17 items, pursuant to Article 6.2 of 
the DSU.  
9. On the other hand, given the length and complexity of Australia's FIRA , the Panel finds that 
the broad reference in New Zealand's panel request to the "measures specified in and required by Australia pursuant to the [ FIRA ]" fails to satisfy the requirement of sufficient clarity in the 
identification of the specific measur es at issue set forth in Article 6.2 of the DSU.  Accordingly, the 
Panel finds that its terms of reference are limite d to the 17 measures specifically identified by New 
Zealand in its panel request and do not encompass ot her measures that may be contained in Australia's 
FIRA , but which were not identified with sufficient precision in the panel request. 
 
III. THE SUMMARY OF THE LEGAL BASIS OF THE COMPLAINT 
10. In its panel request, New Zealand has lis ted a number of provisi ons of the covered 
agreements, which it alleges are breached by the measures adopted by Australia.  New Zealand has 
not drawn an explicit and detailed connection be tween the specific measures challenged and the 
provisions invoked.  New Zealand has only stated in general terms that "the above measures are 
inconsistent with the obligations of Australia  under [nine provisions of the Agreement on the 
Application of Sanitary and Phyto sanitary Measures, (SPS Agreement)]".
4  Having carefully 
considered the language used in th e panel request and the specific content of the provisions of the SPS 
Agreement cited therein, the Panel understands that New Zealand has claimed that "every measure ... 
[identified] in its panel request is inconsistent w ith each of the [nine] provisions referred to [in the 
panel request]."5  In the Panel's view, this satisfies the re quirement that the panel request lays out a 
connection between the various measures ch allenged and the specific provisions invoked.6 
 11. The Panel now turns to the issue of whethe r New Zealand's panel request provides a brief 
summary of the legal basis of the complaint, whic h is sufficient to present the problem clearly, as 
required by Article 6.2 of the DSU.  The Pane l would ideally have preferred a more explicit 
explanation of how or why the measures at issue are considered by New Zealand to be violating the 
identified provisions of the SPS Agreement.  Howe ver, considering the language used in the panel 
request and the specific content of the provision s of the SPS Agreement cited therein, the Panel 
concludes that New Zealand's panel request contai ns enough information to adequately inform the 
                                                     
 
4 Australia – Apples , Request for the Establishment of a Panel by New Zealand (WT/DS367/5), 
7 December 2007, p. 3. 
5 Australia – Apples , Written Submission by New Zealand on Australia's Request for a Preliminary 
Procedural Ruling in Relation to the Consistency of New Zealand's Panel Request with Article 6.2 of the DSU, 
7 April 2008, para. 2.51. 
6 See Appellate Body Report on US – Oil Country Tubular Goods Sunset Review , para. 162. WT/DS367/R 
Page A-8  
 
 responding party and other WTO Members on the nature of the complaint
7 and to allow the 
responding party to begin preparing its defence.8  The Panel recalls in this regard that the complaining 
party is under no obligation to develop its arguments in its panel request.9  Furthermore, the Panel's 
conclusion in this case is supported by practice fo llowed by WTO Members in some previous panel 
requests (including that of New Zealand and Australia ), as well as by rulings such as that adopted by 
the panel in EC – Approval and Marketing of Biotech Products .  Finally, the Panel notes that it is not 
convinced by Australia's arguments that the lack of a more detailed explanation as to how or why the 
17 specifically listed measures at issue are considered  by New Zealand to be violating the provisions 
invoked has prejudiced or will prejudice Australia's ab ility to defend itself in the course of the Panel's 
proceedings. 
 
12. Accordingly, the Panel finds that New Zeala nd's panel request does not fail to provide a brief 
summary of the legal basis of its complaint, wh ich is sufficient to present the problem clearly, as 
required by Article 6.2 of the DSU.  IV. CONCLUSION 
13. In light of the foregoing, the Panel finds: 
 
(a) With respect to the 17 items contained in Australia's Final import risk analysis report 
for apples from New Zealand  (FIRA ) and identified by bullet points in New Zealand's 
request for the establishment of this Pa nel, dated 7 December 2007, the specific 
measures at issue have been properly identified; 
(b) New Zealand's panel request does not identify with sufficient precision any measures 
contained in Australia's FIRA , other than the 17 specific items identified through 
bullet points.  Accordingly, any such other measures are not part of this Panel's terms 
of reference;  and, 
(c) New Zealand's panel request contains suffici ent information regarding the legal basis 
of the complaint to present the problem clearly  with respect to the 17 identified items. 
14. In light of the findings above, the Panel will a llow this proceeding to continue with respect to 
the 17 measures specifically identified in New Zealand's panel request and to the alleged 
inconsistency of such measures with the pr ovisions of the SPS Agreement cited therein. 
 
 
_______________ 
 
 
                                                     
 
7 Appellate Body Report on EC – Bananas III , para. 142. 
8 Appellate Body Report on Thailand – H-Beams , para. 88. 
9 Appellate Body Report on EC – Bananas III , para. 143.  WT/DS367/R 
 Page A-9 
 
 
 ANNEX A-3 
 
 
AUSTRALIA – MEASURES AFFECTING THE IMPORTATION OF APPLES 
FROM NEW ZEALAND 
(WT/DS367) 
 
Working Procedures for the Panel  
  
1. In its proceedings the Panel shall follow th e relevant provisions of the Dispute Settlement 
Understanding (DSU).  In addition, the following Working Procedures shall apply. 
 2. The Panel will provide the Parties
1 and Third Parties2 with a timetable for its proceedings.  
The timetable may be modified by the Panel as a ppropriate, after having consulted the Parties. 
 
3. The Panel shall conduct its intern al deliberations in closed sessi on.  The Parties and interested 
Third Parties shall be present at the meetings only wh en invited by the Panel to appear before it.  The 
Panel may open its substantive meeting with th e Parties to the public, subject to appropriate 
procedures to be adopted by the Panel after consulting the Parties.  
4. The deliberations of the Panel and the documen ts submitted to it shall be kept confidential. 
Nothing in the DSU, nor in these Working Pro cedures, precludes a Party or a Third Party from 
disclosing statements of its own positions to the public.  Members shall treat as confidential 
information submitted by any other Member to th e Panel which that Member has designated as 
confidential.  As provided in Article 18.2 of th e DSU, where a Party or a Third Party submits a 
confidential version of its written submissions to th e Panel, it shall also, upon request of any other 
Party or Third Party, provide a non-confidentia l summary of the information contained in its 
submissions that could be disclosed to the public.  Non-confidential summaries
  shall be normally 
submitted no later than one week af ter the written submission is presente d to the Panel, unless a different 
deadline is granted by the Panel upon a showing of good cause.  
5. Before the substantive meeting of the Panel with the Parties, and in accordance with the 
timetable approved by the Panel, the Parties shall transmit to the Panel written submissions and subsequently written rebuttals in which they presen t the facts of the case, their arguments and their 
counter-arguments, respectively.  Third Parties may transmit to the Panel written submissions after the 
first submissions of the parties have been filed, and in accordance with the timetable approved by the 
Panel. 
 6. At its first substantive meeting with the Par ties, the Panel shall ask New Zealand to present its 
case first.  Subsequently, and still at the same mee ting, Australia will be asked to present its point of 
view.  Parties will then be allo wed an opportunity for final statements, with New Zealand presenting 
its statement first. 
 
7. Third Parties shall be invited to present th eir views during a separate session of the first 
substantive meeting of the Panel set aside for that  purpose.  Third Parties may be present during the 
entirety of this session.  
                                                     
 
1 Throughout this document, the term "Party" refers to  either New Zealand or Au stralia, as appropriate.  
The term "Parties" refers to both New Zealand and Australia. 
2 Throughout the document, the term "Third Parties" refers to Chile, the European Communities, Japan, 
Pakistan, Chinese Taipei and the United States. WT/DS367/R 
Page A-10  
 
 8. Formal rebuttals shall be made  at a second substantive meeting of  the Panel.  At this meeting, 
Australia shall have the right to take the floor fi rst to be followed by New Zealand.  Parties shall 
submit, prior to that meeting, and in accordance with the timetable approved by the Panel, written rebuttals to the Panel.  
9. The Panel may at any time put questions to th e Parties and to the Third Parties and ask them 
for explanations either in the course of the substant ive meetings or in writing.  Replies to questions 
shall be submitted in writing by the date specified by  the Panel.  In additio n, the Parties shall be 
permitted to ask questions to each ot her and to Third Parties.  Repli es of the Parties and Third Parties 
to questions, and Parties' comments on each other's re plies to questions, will not be attached to the 
Panel report as annexes.  They will be reflected in the findings section of the Panel report where 
relevant.  10. Each Party shall make available to the Panel a nd to the other Party a written version of its oral 
statements, preferably at the end of the meeting wi th the Panel, and in any event no later than the 
working day following the presentation.  Any Third Party that wishes to present its views shall 
similarly make available to the Panel and to the Pa rties and other Third Parties a written version of its 
oral statements, preferably at the end of the meeti ng with the Panel, and in any event no later than the 
working day following the presentation.  Parties and Third Parties shall provide the Panel and other 
participants at the respective session with a provision al written version of their oral statements before 
these statements are made. 
 
11. In the interest of full transparency, oral presentations shall be made in the presence of the 
Parties.  Moreover, each Party's written submissions, including replies to questions put by the Panel, 
shall be made available to the other Party.  Thir d Parties shall receive copies of the Parties' first 
written submissions and rebuttals.  Parties shall su bmit all factual evidence to  the Panel as early as 
possible and no later than during the first substan tive meeting, except with  respect to evidence 
necessary for purposes of rebuttals or answers to qu estions.  Exceptions may be granted by the Panel 
upon a showing of good cause.  In such cases, the othe r Party shall be accorded a period of time for 
commenting, as appropriate.  12. Within seven (7) calendar days followi ng the submission of a written submission or 
presentation of an oral statement to the Panel, each Party and Third Party shall provide the Panel with 
an executive summary of the respective submission or  statement.  These executive summaries will be 
used by the Panel only for the purpose of drafting a concise factual and arguments section of the Panel 
report so as to facilitate timely translation and circulation of the Panel report to the Members.  
Executive summaries shall not serve in  any way as a substitute for the submissions of the Parties.  
Executive summaries to be provided by Parties shall each not exceed ten (10) pages in length.  Third 
Parties' executive summaries shall not exceed three (3) pages in length.  The Panel may, in light of 
further developments, allow the Parties and Third Parties to submit longer summaries. 
 13. To facilitate the maintenance of the record of the dispute, and to maximize the clarity of 
submissions, in particular the refe rences to exhibits submitted by Pa rties, Parties shall sequentially 
number their exhibits throughout the course of the di spute.  For example, exhibits submitted by New 
Zealand should be numbered NZ-1, NZ-2, etc.  If the last exhibit in connection with the first submission was numbered NZ-5, the first exhibit of the next submission thus would be numbered NZ-
6.  Exhibits submitted by Australia should be numbered AUS-1, AUS-2, etc.  
14. Following the issuance of the interim report,  Parties shall have two weeks to submit written 
requests to review precise aspects of the interim report.  Following receipt of any written requests for review, and unless any Party requests the Panel to hol d an interim review meeting with the Parties, 
each Party shall have one week to submit written comments on the other Party's written request for  WT/DS367/R 
 Page A-11 
 
 
 review.  Comments shall be strictly limited to commenting on the other Party's written request for 
review.  15. The Parties and Third Parties have the right to determine the composition of their own delegations.  Delegations may include, as represe ntatives of the government concerned, private 
counsel and advisers.  The Parties and Third Parti es shall have responsibility for all members of their 
delegations and shall ensure that all members of  their delegations, as well as any other advisors 
consulted by a Party or Third Party, act in acco rdance with the rules of the DSU and the Working 
Procedures of this Panel, particularly in regard to confidentiality of the proceedings.  Parties shall 
provide a list of the participants of their delegation to the Secretary of the Panel and to each other no 
later than 5.00 pm, local Geneva time, the wo rking day before any meeting with the Panel. 
 16. Any request for a preliminary ruling (including rulings on jurisdictional issues) to be made by the Panel shall be submitted no later than in a Pa rty's first written submission.  Unless provided 
otherwise by the Panel, if New Zealand requests any such ruling, Australia shall submit its response to 
such a request in its first written submission.  Like wise, and unless provided othe rwise by the Panel, if 
Australia requests any such ruling, New Zealand sh all submit its response to such a request in its 
rebuttal submission.  Exceptions to this proce dure may be granted by the Panel upon a showing of 
good cause.  The Panel shall inform the Parties promptly of any preliminary rulings it might make in the course of the proceedings.  In addition, the Panel may also choose to inform Third 
Parties of such preliminary rulings, if appropriate. 
 
17. In the course of the proceedings, the Panel will determine if there is the need to seek expert 
advice.  In such case, the following procedures shall apply:  
(a) The Panel may seek expert advice from i ndividual experts and from international 
organizations, as appropriate. 
(b) The Panel may ask the Secretariat of the International Plant Protection Convention 
(IPPC), as well as the Parties, for suggestions of possible experts.  Parties shall not engage in direct contacts with individuals suggested. 
(c) The Panel will provide the Parties with a list of possible experts, including 
information from their curricula vitae  and declarations of potential conflicts of 
interest.  Parties will have the opportunity to comment and to make known any 
compelling objections to any particular expert. 
(d) The Panel will select the experts on the basis of their qualifications and the need for 
specialized scientific expertise.  The Pane l will decide the number of experts in light 
of the number and type of issues on wh ich advice will be sought, as well as of the 
different areas on which each e xpert can provide expertise. 
(e) The Panel will inform the Parties of the experts it has selected.  Individual experts 
shall act in their personal capacities and not  as representatives of any entity.  They 
shall be subject to the DSB's Rules of Conduct for the Understanding on Rules and 
Procedures Governing the Settlement of Disputes  (WT/DSB/RC/1). 
(f) The Panel will prepare written questions fo r the experts.  Parties will have the 
opportunity to comment on the proposed ques tions, or suggest additional ones, before 
the Panel decides on the final questions to be sent to the experts.  The Panel may 
provide the experts, on a confidential basis,  with relevant parts of the Parties' 
submissions, including exhibits, as well as with any additional information deemed 
necessary. WT/DS367/R 
Page A-12  
 
 (g) Experts will be requested to provide responses in writing within a time-period 
specified by the Panel.  Copies of the r esponses will be provided by the Panel to the 
Parties.  The Parties will have the opportunity to comment in writing on the responses from the experts. 
(h) The Panel may schedule a meeting with e xperts, prior to the second substantive 
meeting with the Parties.  Prior to said m eeting, the Panel will ensure that: (i) the 
Parties' comments on the experts' responses are provided to the experts; (ii) the experts are individually provided with th e other experts' responses to the Panel's 
questions. During the meeting, experts will be invited to present their responses to questions and to complement these res ponses as necessary, and to respond to 
additional questions from the Panel and the Parties.  The Panel may schedule 
additional meetings with experts if its deems it appropriate.  The Secretariat will 
prepare a summary of the experts' written replies to questions, as well as a transcript 
of the meeting with the experts, for inclus ion in the Panel's report.  The experts will 
be given an opportunity to comment on the drafts of these texts before they are 
finalized. 
18. The following procedures regarding service of documents shall apply: 
 
(a) Each Party shall serve its submissions directly on the other Party.  Each Party shall, in 
addition, serve its first written submission on Third Parties.  Each Third Party shall 
serve its submissions on the Parties and othe r Third Parties.  Each Party and Third 
Party shall confirm in writing, at the time it provides the submission to the 
Secretariat, that copies have been served as required. 
(b) The Parties and Third Parties shall provid e their written submissions to the Panel, 
through the Secretariat, by 5:00 p.m., local Geneva time, on the deadlines established 
by the Panel. 
(c) The Parties and Third Parties shall provide th e Secretariat with seven (7) paper copies 
of all their submissions as well as an electronic copy on a CD-ROM, diskette or as an e-mail attachment, in a format compatible with the Secretariat's software.  Paper copies shall be delivered to the Disp ute Settlement Registrar, Mr. ***** ***** 
(Room 2150).  Electronic copies should be sent by e-mail to Mr. ***** at DSregistry@wto.org
;  Ms. ***** ***** at *****.*****@wto.org ;  Mr. ***** ***** 
at *****.*****@wto.org ;  and, Mr. ***** ***** at *****.*****@wto.org . 
(d) Parties and Third Parties shall provide the Secretariat with written copies of their oral 
statements no later than close of busin ess on the day following the date of the 
presentation.  Written replies to questions sh all be submitted at the date decided by 
the Panel. 
(e) The Panel will provide Parties with an electronic version of the descriptive sections of 
its draft report, the interim report and the final report, as well as of other documents, 
as appropriate.  When the Panel transmits to  the Parties or Third Parties both paper 
and electronic versions of a document, the paper version shall constitute the official 
version for the purposes of the record of the dispute. 
19. These Working Procedures may be modified  by the Panel as appropriate, after having 
consulted the Parties. 
_______________  
  WT/DS367/R 
 Page A-13 
 
 
 ANNEX A-4 
 
 
Australia – Measures Affecting the Importation of Apples from New Zealand 
(WT/DS367) 
 
Procedures for the Panel's First Substantive Meeting  
 
2-3 September 2008 
  
I. OPEN HEARINGS 
1. As set out in the timetable for this dispute,  the Panel will hold its first substantive meeting on 
Tuesday 2 and Wednesday 3 September 2008.  Furt her to the parties' request, and after having 
consulted the Parties
1 and Third Parties2 on possible options, the first s ubstantive meeting will be held 
through open hearings according to  the procedures set out below. 
 2. To respect the rules of confidentiality, in particular as regards the Exhibit identified by 
New Zealand as business confidential,  no information designated as confidential by a party or a third 
party shall be addressed during these open hearings.  The Panel reserves the right to call for a closed 
confidential session of the substantive meeting, if n ecessary, in order to address issues related to any 
confidential information.  The Panel also reserves th e right to suspend the open hearings at any time, 
on its own initiative or at the request of either Party, if there is any risk of breach of confidentiality or 
of disruption of the meeting.  If the open heari ngs are suspended by the Panel for any reason, the 
Panel may decide to resume the mee ting in a closed confidential session. 
 
3. At the open hearings, the Panel will ask New Z ealand and Australia, in that order, to make 
their respective opening statements.  After Parties have made these opening statements, New Zealand and Australia will be given the opportunity to ma ke comments on each other's statements and to pose 
questions.  The Panel may also pose questions to  the Parties. In a separate session of the open 
hearings, Third Parties will be given the opportunity to make their own statements, if they so wish.  
4. Registered delegates of WTO Members and othe r registered individuals will be able to follow 
the open hearings by means of simultaneous broadcas ting of the proceedings to a separate room.  If, 
for logistical reasons, simultaneous broadcasting of the proceedings should turn out to be not feasible 
or convenient, registered persons may be invited to follow the open hearings by seating in the gallery 
of the room where the meeting is being held. 
 
5. The proceedings of the substantive meeting,  including those of the closed confidential 
session, may be tape-recorded by the Secretariat.  Tape recordings of the meeting will be for the 
exclusive use of the Panel and of the WTO Secretar iat staff assisting the Panel, and will be kept 
confidential.  
                                                     
 
1 Throughout this document, the term "Party" refers to  either New Zealand or Au stralia, as appropriate.  
The term "Parties" refers to both New Zealand and Australia. 
2 Throughout this document, the term "Third Parties" refers to Chile, the European Communities, 
Japan, Pakistan, Chinese Taip ei and the United States. WT/DS367/R 
Page A-14  
 
 II. THIRD PARTY SESSION 
6. Unless otherwise provided by the Panel, the first substantive meeti ng will be reconvened on 
Wednesday, 3 September 2008, at 10 a.m., in the Ce ntre William Rappard, for a Third Party session, 
at which Third Parties will be given the opportunity to make their statements, if they so wish.  
7. After Third Parties have made their statemen ts, New Zealand and Australia will be given the 
opportunity to pose questions to any Third Party or  to make comments on the statements of Third 
Parties.  The Panel may also pose questions to the Third Parties. 
 
III. CLOSED CONFIDENTIAL SESSION 
8. After having heard the statements of Parties and Third Parties, the Panel may decide to call 
for a closed confidential session of th e substantive meeting, if necessary. 
 9. In the light of the nature of the information to be discussed and the content of the statements 
made by Parties and Third Parties, the Panel will decide whether Third Parties will be invited to 
participate in the closed confidential session. 
 10. At the closed confidential session, the Panel may invite New Zealand and Australia, as well as 
Third Parties if it were the case, to make further statements.  The Panel may also pose questions to 
Parties and, if it were the case, to Third Parties.  IV. FURTHER RULES 
11. After having consulted the Parties, the Panel may amend the procedures for the first 
substantive meeting or complement them  with additional rules, as appropriate. 
  
  WT/DS367/R 
 Page A-15 
 
 
 ANNEX 1 (TENTATIVE ORDER OF PROCEEDINGS)1 
 
 Tuesday, 2 September 2008
 
 
10:00 – 13:00  Statements of Parties. 
 13:00 – 15:00  Break.  15:00 – 18:00  Statements of Parties (cont'd.).  Questions and answers. 
 
 Wednesday, 3 September 2008
 
 10:00 – 13:00  Statements of Third Parties.  Questions and Answers. 
 
13:00 – 15:00  Break.  15:00 – 16:00  Closed confidential session (if necessary).  16:00 – 18:00  Concluding statements of Parties. 
 
 
_______________ 
 
 
 
                                                     
 
1 This is only indicative and will depend on the development of the proceedings. WT/DS367/R 
Page A-16  
 
 ANNEX 2 (IMPORTANT DATES)
1 
 
 Wednesday, 23 July
:  Panel sends proposed procedures for substantive meeting to Parties for 
comments. 
 
Tuesday, 29 July :  Parties send comments on proposed proce dures for substantive meeting to Panel. 
 Tuesday, 5 August
:  Panel sends approved procedures for s ubstantive meeting to Parties and Third 
Parties. 
 
Thursday, 7 August :  Members are informed of open hearings for substantive meeting. 
 Monday, 11 August
:  Notice of open hearings for substa ntive meeting is published on the WTO 
website.  Registration begins. 
 
Friday, 29 August :  End of registration for outside individua ls (non delegates) wishing to attend open 
hearings for substantive meeting.  
_______________ 
  
 
                                                     
 
1 These dates are only indicative and may be modified at any time.  WT/DS367/R 
 Page A-17 
 
 
 ANNEX A-5 
  
Australia – Measures Affecting the Importation of Apples from New Zealand 
(WT/DS367) 
 
Procedures for the  Panel's Meeting with the Experts and Parties
 
and the Panel's Second Substantive Meeting  
 
30 June 2009 and 1-2 July 2009 
 
 The current procedures shall apply to the meetin g of the Panel with the designated experts and 
Parties
1, scheduled to take place on Tuesday 30 June 20 09, as well as to the Panel's second substantive 
meeting with the Parties, scheduled to take place on Wednesday 1 and Thursday 2 July 2009.  In case 
of any conflict, the current procedures take preceden ce over any conflicting prov isions in the Working 
Procedures for the Panel adopted on 26 March 2008.   
V. PANEL'S MEETING WITH THE EXPERTS AND PARTIES (30 JUNE 2009 AND, IF 
NECESSARY, 1 JULY) 
1. As set out in the timetable for this dispute,  the Panel will hold a meeting with the designated 
experts on Tuesday 30 June 2009.  The Panel may decide  to continue the meeting into the morning of 
Wednesday 1 July 2009, if necessary and after having consulted the Parties.  Further to the Parties' 
request, and after having consulted the Parties on possible options, the meeting of the Panel with the 
designated experts will be held through an open session according to the procedures set out below.  
The meeting will be conducted in English only, without simultaneous interpretation. 
 2. To respect the rules of confidentiality, in par ticular as regards exhibits identified by any of the 
Parties as confidential, no information designated as confidential by a Party shall be addressed during 
this open session.  The Panel reserves the right to call for a closed confidential session of the meeting 
with the designated experts, if necessary, in or der to address issues related to any confidential 
information.  The Panel also reserves the right to suspend the open session at any time, on its own 
initiative or at the request of either Party, if th ere is any risk of breach of confidentiality or of 
disruption of the meeting.  If the open session is su spended by the Panel for any reason, the Panel may 
decide to resume the meeting in a closed confidential session. 
 
3. The purpose of the Panel's meeting with th e experts is for the Panel to obtain further 
clarification of some of the factual issues relevant  for this case.  In particular, the meeting should 
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, as well as 
allow the Panel and the Parties to pose questions to  the experts in order to seek any elaboration or 
clarification on issues that are relevant to the case. 
 
4. At the meeting, the Panel will introduce the e xperts.  Subsequently, experts will be allowed 
the opportunity to make brief general comments on their responses, in light of the written comments 
made by the Parties.  The Panel will then pose qu estions to the experts and allow New Zealand and 
Australia the opportunity to pose their own questions to experts.  Parties shall pose direct factual 
questions and refrain from making statements, and argum entative or leading questions to the experts.  
                                                     
 
1 Throughout this document, the term "Party" refers to  either New Zealand or Au stralia, as appropriate.  
The term "Parties" refers to both New Zealand and Australia. WT/DS367/R 
Page A-18  
 
 Experts should answer only those questions that th ey feel competent to answer.  If necessary, and 
after having heard the Parties' opinions, the Panel will decide on the appropriateness of any question 
being posed to the experts.  Parties will not pose questions to each other, except with the Panel's 
authorization.  In the course of the Panel's se cond substantive meeting, Parties will have ample 
opportunities to develop their respective arguments in cluding, if they so wish, to develop arguments 
on the experts' responses. 
 5. The focus of the meeting will be the science relied upon by Australia in its IRA regarding fire 
blight, European canker and apple leafcurling midge , as well as the risk assessment techniques used 
by Australia in its IRA.  The Panel intends to group the discussion into six subject areas and to 
organize the discussion accordingly.  The subject ar eas will be as follows:  (a) General terms and 
definitions;  (b) Risk assessment techniques;  (c) Fire blight;  (d) European canker;  (e) Apple 
leafcurling midge;  and, (f) Other.  For each of these subject areas, the Panel will organize the discussion so that both Parties and the Panel have the opportunity to pose questions on the various issues.  The Panel will normally allow New Zealand the opportunity to pose questions to the experts 
first, to be followed by Australia.  Throughout  the discussion of each issue, the Panel may pose 
questions before, during or after the Parties are gi ven the opportunity to pose their own questions.  
The Panel may also allow the opportunity to Parti es to come back with new questions or follow-up 
questions.  Once the Panel has decided that a particul ar issue has been suffici ently explored, the Panel 
may invite the experts to make some concluding re marks on the specific issue, if they so wish.  
Throughout the meeting with the experts, the Panel will endeavour to ensure that sufficient time is 
devoted to the discussion of the different relevant issu es.  In order to achieve this objective, the Panel 
may decide at any point that there is a need to move  on to a different issue.  Experts will be asked to 
provide their responses individually and shall refrain from conferring during the course of the meeting.  
6. Parties shall refrain from submitting any new f actual evidence to the Panel in the course of 
the meeting with the experts.  Upon a showing of  good cause, the Panel may exceptionally allow the 
introduction of new evidence in the course of the mee ting with the experts at the request of a Party, 
and after having heard the other Party, if such new evidence is necessary for the purpose of posing a 
question to an expert.  The Panel may allow the subm ission by any expert of background material that 
is necessary to respond to a written comment made by any of the Parties or to respond to a question 
posed by the Panel or by any of the Parties. 
 7. Persons in possession of a valid WTO badge and individuals registered through the WTO 
Secretariat will be able to follow the open session of the Panel's meeting with the experts by means of simultaneous broadcasting of the proceedings to a separate room.  If, for logistical reasons, 
simultaneous broadcasting of the proceedings shoul d turn out to be infeasible or inconvenient, 
interested persons may be invited to follow the ope n hearings by seating in the gallery of the room 
where the meeting is being held.  8. The proceedings of the Panel's meeting with  the experts, including those of the closed 
confidential session if such a session were to ta ke place, will be tape-recorded by the WTO 
Secretariat.  Tape recordings of the meeting will be for the exclusive use of the Panel and of the 
Secretariat staff assisting the Panel, and will be kept  confidential.  No recording or filming of the 
proceedings other than by the WT O Secretariat will be allowed. 
 9. The WTO Secretariat shall prepare a transcript of the proceedings of the Panel's meeting with 
the experts.  For the purpose of reviewing the tran script's accuracy, the Panel will send a copy of the 
transcript to the experts and to the Parties.  The tr anscript of the proceedings of the Panel's meeting 
with the experts and the compilations of written rep lies of the experts shall be referenced in the 
Panel's report.  The Panel may quote from that tran script and from the compilation in the relevant 
sections of the Panel's report.  Such transcript a nd compilation, however, will not be appended in full  WT/DS367/R 
 Page A-19 
 
 
 to the Panel's report.  In the interest of transp arency, the Panel shall ask the Secretariat to make 
available the transcript of the pro ceedings of the Panel's meeting with the experts and the compilation 
of the experts' written replies on the WTO's website, in the section of that website that is related to the 
current dispute.  VI. PANEL'S SECOND SUBSTANTIVE MEETING (1-2 JULY 2009) 
A. O
PEN HEARINGS  
10. As set out in the timetable for this dispute,  the Panel will hold its s econd substantive meeting 
with the Parties on Wednesday 1 and Thursday 2 July 2009.  Further to the Parties' request, and after 
having consulted the Parties on possible options, th e second substantive meeting will be held through 
open hearings according to the procedures set out below.  The meeting will be conducted in English 
only, without simultaneous interpretation.  11. To respect the rules of confidentiality, in par ticular as regards exhibits identified by any of the 
Parties as confidential, no information designated as confidential by a Party shall be addressed during 
these open hearings.  The Panel reserves the right to call for a closed confidential session of the 
substantive meeting, if necessary, in order to addr ess issues related to any confidential information.  
The Panel also reserves the right to suspend the ope n hearings at any time, on its own initiative or at 
the request of either Party, if there is any risk of breach of confidentiality or of disruption of the 
meeting.  If the open hearings are suspended by th e Panel for any reason, the Panel may decide to 
resume the meeting in a closed confidential session. 
 
12 At the open hearings, the Panel will ask Austra lia and New Zealand, in that order, to make 
their respective opening statements.  After Parties ha ve made these opening statements, the Panel will 
grant Parties the opportunity to pose questions a nd to make comments on each other's statements.  
After Parties have made their opening statements , and throughout the meeting, the Panel may pose 
questions to the Parties.  In order to facilitate the exchange of views and information, Parties are 
encouraged to provide preliminary oral replies to the que stions posed by the other Party and by the 
Panel.  At the end of the meeting, the Panel will ask New Zealand and Australia, in that order, to make 
their respective concluding statements.  13. Persons in possession of a valid WTO badge and individuals registered through the WTO 
Secretariat will be able to follow the open heari ngs by means of simultaneous broadcasting of the 
proceedings to a separate room.  If, for logistical reasons, simultaneous broadcasting of the proceedings is infeasible or inconvenient, inter ested persons may be invited to follow the open 
hearings by seating in the gallery of th e room where the meeting is being held. 
 
14. The proceedings of the substantive meeting,  including those of the closed confidential 
session, may be tape-recorded by the Secretariat.  Tape recordings of the meeting will be for the 
exclusive use of the Panel and of the WTO Secretar iat staff assisting the Panel, and will be kept 
confidential.  No recording or filming of the pro ceedings other than by the WTO Secretariat will be 
allowed.  There will be no transcript of the subs tantive meeting and only written versions of oral 
statements as well as written responses to qu estions will become part of the record. 
 
B. C
LOSED CONFIDENTIAL SESSION  
15. After having heard the statements of the Par ties, the Panel may decide to call for a closed 
confidential session of the substantive meeting, if necessary.  
16. At the closed confidential session, the Panel may invite the Parties to make further statements.  
The Panel may also pose questions to the Parties. WT/DS367/R 
Page A-20  
 
 VII. FURTHER RULES 
17. After having consulted the Parties, the Pane l may amend the procedures for the substantive 
meeting or for the Panel's meeting with the experts,  or complement them with additional rules, as 
appropriate.  
 
  WT/DS367/R 
 Page A-21 
 
 
 ANNEX 
(IMPORTANT UPCOMING DATES)1 
 
 Wednesday, 3 June
:  Panel sends proposed procedures for second substantive meeting and for the 
Panel's meeting with the experts to Parties for their comments. 
 Tuesday, 9 June
:  Parties send comments on proposed procedures for substantive meeting and for the 
meeting with the experts to Panel.  
By Friday, 12 June
:  Panel sends approved procedures for second substantive meeting and for the 
Panel's meeting with the experts, to Parties and experts.  Monday, 15 June
:  Members are informed of open hearings for substantive meeting. 
 
By Thursday, 18 June :  Notice of open hearings for substa ntive meeting is published on the WTO 
website.  Registration begins.  Thursday, 25 June
:  End of registration for outside indivi duals (persons not in possession of a valid 
WTO badge) wishing to attend substantive meeting or meeting of the Panel with the experts. 
 
Thursday, 25 June :  Parties provide a list of their respective delegations to the Secretary of the Panel 
and to each other.  Monday, 29 June
:  Secretary of the Panel provides Parties with a list of the individuals registered 
through the WTO Secretariat. 
 
Tuesday, 30 June :  Panel's meeting with the desi gnated experts and the Parties. 
 Wednesday and Thursday, 1-2 July 2009
:  Panel's second substantive meeting with the Parties. 
 By Friday, 10 July
:  Panel sends written questions to Parties.   Parties send written questions to each 
other, copying the Panel. 
 By Friday, 24 July
:  Parties submit replies to questions. 
 By Friday, 31 July
:  Parties may submit comments on each other's replies to questions. 
 
_______________ 
 
 
                                                      
1 These dates are only indicative and may be modified by the Panel at any time, after having consulted 
the Parties.  WT/DS367/R 
 Page B-1 
 
 
 ANNEX B 
  
CONTENTS Page 
Annex B-1 List of replies from the scientific experts to questions posed by the 
Panel B-2 
Annex B-2 Transcript of the Panel's m eeting with the scientific experts B-2 
 
 
_______________ 
 
 WT/DS367/R 
Page B-2  
 
 ANNEX B-1 
 
 The List of replies from the scientific expert s to questions posed by the Panel (document 
WT/DS367/11) will only be available electronically on the WTO website. 
 
 
ANNEX B-2 
 
 
The Transcript of the Panel's meeting with the scientific experts (document WT/DS367/12) will only 
be available electronically on the WTO website.   
__________