WORLD TRADE  
ORGANIZATION   
WT/DS413/4 
30 September 2011 
 
 (11-4727) 
 Original:   English 
  
 
CHINA – CERTAIN MEASURES AFFECTING  
ELECTRONIC PAYMENT SERVICES 
 
Communication from the Chairman of the Panel 
 
 
 The following communication, dated 30 Septem ber 2011, from the Chairman of the Panel to 
the Chairperson of the Dispute Settlement Body, is  circulated to Members for their information. 
 
_______________ 
 
  On 5 July 2011, China submitted to the Panel a request for a preliminary ruling concerning 
the consistency of the United States' request for the establishment of the Panel (WT/DS413/2) with 
Article 6.2 of the Disput e Settlement Understanding. 
 
 On 7 September 2011, the Panel issued the enclo sed preliminary ruling to the parties and third 
parties.  The preliminary ruling will be incorporated  as an integral part of the Panel's final report. 
  After consulting the parties to the dispute, th e Panel decided to inform the Dispute Settlement 
Body of the content of its preliminary ruling.  Therefore, I would be grateful if you would circulate 
the body of this letter and the enclosed preliminary ruling as document WT/DS413/4. 
 
_______________ 
 WT/DS413/4 
Page 2  
 
  PRELIMINARY RULING OF THE PANEL 
 
7 September 2011 
  
I. PROCEDURAL BACKGROUND  
1. On 5 July 2011, China submitted to the Panel a request for a preliminary ruling requesting 
that the Panel rule, as early as possible, that the United States' request for th e establishment of a panel 
(panel request)
1 is inconsistent with the requirements of Ar ticle 6.2 of the DSU. In its request, China 
asked the Panel to issue a preliminary ruling before  the due date of the complaining party's first 
written submission on the grounds that the deficiencies in the panel request are central to all of the 
United States' claims in this dispute.2 The United States requested th e Panel to decline China's 
request, asserting that the timing and process requested by China would depart from past WTO practice, would be unnecessary for purposes of addressing China's concern, would be unduly burdensome for the Panel and the United States, w ould likely delay the proceedings, and would be 
inconsistent with basic due process considerations.
3  
2. After consultations with the parties regardi ng the procedural implications of China's 
preliminary ruling request, the Panel decided to issu e a preliminary ruling before the due date of the 
United States' first written submission because, inter alia , of the far-reaching consequences that 
agreeing with the substance of China's request might have, and because in this case proceeding in this 
way did not cause additional delays. The Panel gave  an opportunity to the United States to submit 
additional written comments on China's request and also  invited the third parties to submit any written 
comments they might have in response to the views expressed by the parties.4 Moreover, as neither 
China nor the United States requested a hearing on th e preliminary ruling issue, the Panel gave the 
parties the opportunity to submit further written comments to respond to each other's comments.5  The 
Panel issued its ruling to the parties and third parties on 7 September 2011.  
II. SUBSTANCE OF CHINA'S REQUEST FOR A PRELIMINARY RULING 
3. As already pointed out, China bases its request fo r a preliminary ruling on Article 6.2 of the 
DSU, which provides as follows: 
The request for the establishment of a panel shall be made in writing. It shall indicate 
whether consultations were he ld, identify the specific measu res at issue and provide a 
brief summary of the legal basis of the complaint sufficient to present the problem 
clearly. 
4. In its request, China submits that, contrary  to the requirements of Article 6.2, the 
United States' panel request fails to provide a br ief summary of the legal basis of the complaint 
sufficient to present the problem clearly. China po ints out that the United States' panel request 
provides a definition of the services at issue in this dispute ‒ "electronic payment services" ‒ and 
identifies three relevant subsectors in China's Schedule.6 China recalls that the nature and extent of its 
                                                      
1 See WT/DS413/2.  
2 China's preliminary ruling request, para. 14. 
3 Letter from the United States dated 6 July 2011, p. 1. 
4 The United States filed its comments on 29 July 2011. None of the third parties submitted comments 
on the first set of submissions. 
5 On 25 August 2011, China submitted written comments on the United States' comments and the third 
parties' comments. On 30 August 2011, the United Stat es submitted views on China's comments and the third 
parties' comments.  
6 China's preliminary ruling request, para. 2.  WT/DS413/4 
 Page 3 
 
 
  market access and national treatment obligations depe nd not only on the particular subsector but also 
on the mode(s) of supply. China submits that the Un ited States' panel request fails to explain, "even 
concisely"7, how the definition of "electronic payment services" relates to China's specific 
commitments in any of the three subsectors identified in the panel request, and further, that the panel 
request fails to indicate which mode or modes of su pply the United States considers to be at issue. 
China considers that, due to these two deficiencies, the United States' panel request "fails to connect 
the challenged measures to the provisions of the c overed agreements that the United States relies upon 
as the legal basis for its claims"8, which amounts to a failure to "present the problem clearly" as 
required by Article 6.2 of the DSU.  
5. The United States considers that China's prelimin ary ruling request lacks merit. According to 
the United States, its panel request identifies th e specific measures being challenged, the specific 
commitments at issue in China's Schedule, and the specific obligations that are the subject of the 
United States' complaint. In addition, the United States' panel request specifies, "with precision",9 the 
services at issue:  "electronic payment services for payment card transactions".10 The United States 
further points out that its panel re quest provides "a detailed narrative"11 of the claims it is making as 
an additional basis for China to understand "the le gal basis of the complaint". The United States 
submits that nothing more is required and that its panel request contains information "sufficient to 
present the problem clearly". The United States adds in this regard that its panel request "does not 
merely list the articles alleged to have been violated. The request also sets forth facts and 
circumstances describing the substance of the dispute".12 The United States therefore considers that its 
panel request is fully consistent with Article 6. 2 and, accordingly, requests that the Panel reject 
China's request in its entirety. 
6. The Panel begins its considerati on of the substance of China's request for a preliminary ruling 
with a review of how Article 6.2 has been interp reted in WTO dispute settlement. Next, the Panel will 
recall the main elements of information that the pa nel request already provid es to China and the third 
parties. Finally, the Panel will address the specific concerns raised by China in its request for a 
preliminary ruling.   
III. CONSIDERATION BY THE PANEL 
A. INTERPRETATION OF ARTICLE  6.2 OF THE DSU 
7. The Appellate Body has explained that Article  6.2 of the DSU imposes four requirements, 
namely, a panel request must (i) be in writing; (ii) indicate whether consultations were held; 
(iii) identify the specific m easures at issue; and (iv) provide a br ief summary of the legal basis of the 
complaint sufficient to present the problem clearly.13 The Appellate Body has indicated that 
compliance with these requirements "must be demons trated on the face of the request" and "must be 
determined on the merits of each case, having consider ed the panel request as a whole, and in the light 
of attendant circumstances".14 
                                                      
7 China's preliminary ruling request, para. 3. 
8 China's preliminary ruling request, para. 3. 
9 United States' response to China's preliminary ruling request, para. 15. 
10 United States' response to China's preliminary ruling request, para. 15; WT/DS413/2, p. 1 and 
footnotes 1 and 2. 
11 United States' response to China's preliminary ruling request, para. 15. 
12 United States' response to China's preliminary ruling request, para. 15; see also Panel Report, 
Mexico – Corn Syrup , para. 7.15. For full case titles and citations, see Annex A to this document.  
13 Appellate Body Report, Korea – Dairy , para. 120. 
14 Appellate Body Report, US – Carbon Steel, para. 127; see also Appellate Body Reports, Korea –
Dairy, paras. 124-127; Australia – Apples , para. 418. WT/DS413/4 
Page 4  
 
  8. As indicated, China's request concerns the requirement to provide a brief summary of the 
legal basis of the complaint sufficient to presen t the problem clearly. The Appellate Body has 
explained that the term "legal basis" in Article 6.2 of the DSU refers to the claim made by the complaining party.
15 A claim "sets forth the complainant's view  that the respondent party has violated, 
or nullified or impaired the benefits arising from, an identified provision of a particular agreement".16   
9. According to the Appellate Body, Article 6.2 ca lls for sufficient clarity with regard to the 
"legal basis", i.e. with regard to  the claim or claims made by a party, because the responding party "is 
entitled to know what case it has to answer, and what violations have been alleged so that it can begin 
to prepare its defence".17 The "legal basis", which must be pr ovided in a panel request, must be 
distinguished from the arguments of a party, which are "adduced by a complaining party to 
demonstrate that the responding party's measure does indeed infringe upon the identified treaty 
provision".18 The Appellate Body has explained that argum ents in support of a claim are adduced to 
demonstrate that the responding party's measure does indeed infringe upon the identified treaty 
provision.19 
10. The Appellate Body has clarified that "[a] brie f summary of the legal basis of the complaint 
… 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".20 This brief summary must be sufficient to 
present the problem clearly. 
11. Regarding the phrase "present the problem clearly",  the Appellate Body has observed that in 
order for a panel request to "present the problem cl early", a complaining party must "plainly connect 
the challenged measure(s) with the provision(s) of  the covered agreements claimed to have been 
infringed, so that the respondent party is aware of the basis for the alleged nullification or impairment 
of the complaining party's benefits".21 In the Appellate Body's view, "[o]nly by such connection 
between the measure(s) and the relevant provision( s) can a respondent 'know what case it has to 
answer, and ... begin preparing its defence'".22   
12. With regard to the requirement that a panel request allow the responding party to "begin" to 
prepare its defence, the panel in Australia – Apples  observed that this requirement:  
[D]oes not amount to a requirement for allowing the defendant to fully develop its 
defence on the sole basis of the complainan t's panel request. Such an interpretation 
would wipe out any distinction between claims and arguments. 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 confront 
each other's arguments and counterarguments.
23 
                                                      
15 Appellate Body Report, US – Oil Country Tubular Goods Sunset Reviews , para. 162. 
16 Appellate Body Report, Korea – Dairy , para. 139. 
17 Appellate Body Report, Thailand – H-Beams , para. 88. 
18 Appellate Body Report, Korea – Dairy , para. 139; see also Appellate Body Report, US –  Oil Country 
Tubular Goods Sunset Reviews , para. 162. 
19 Appellate Body Report, Korea – Dairy , para. 139; see also Appellate Body Report, EC – 
Bananas  III, para. 141. 
20 Appellate Body Report, EC – Selected Customs Matters , para. 130. 
21 Appellate Body Report, US – Oil Country Tubular Goods Sunset Reviews , para. 162. See also 
Appellate Body Report, US – Continued Zeroing , para. 160. 
22 Appellate Body Report, US – Oil Country Tubular Goods Sunset Reviews , para. 162, quoting 
Appellate Body Report, Thailand – H-Beams , para. 88. 
23 Panel Report, Australia – Apples , para. 7.929.  WT/DS413/4 
 Page 5 
 
 
  B. INFORMATION PROVIDED IN THE UNITED  STATES ' PANEL REQUEST  
13. Having reviewed how the relevant requirements of  Article 6.2 have been interpreted in WTO 
dispute settlement, we now turn to consider the United St ates' panel request. It is useful at this point to 
recall the main elements of information that the pane l request provides to China and the third parties.  
14. To begin with, the United States' panel request  describes the services at issue as "electronic 
payment services for payment card transactions". The description is accompanied by two separate 
footnotes that provide, respectively, a definition of those services and an illustrative list of payment cards.
24   
15. The panel request also identifies a number of meas ures at issue that are said to affect trade in, 
and suppliers of, the relevant services – that is to say, it refers to the requirements allegedly imposed 
by China as well as the "instruments" through whic h these requirements are claimed to be imposed. 
The requirements are identified and described as follows:25  
(a) ChinaUnionPay (CUP) is the "only entity"26 that China permits to supply electronic 
payment services for payment card transactions denominated and paid in RMB in China; 
(b) China requires handling by CUP of all RM B transactions in Macao or Hong Kong, 
China using payment cards issued in  Mainland China, as well as any RMB 
transactions in Mainland China using RM B payment cards issued in Hong Kong, 
China or Macao, China; 
(c) China requires all payment card processing devices at merchant locations, all ATMs, 
and all point of sale (POS) terminals in China to be compatible with CUP's system 
and capable of accepting CUP payment cards; 
(d) China requires that all acquiring instituti ons post the CUP logo and be capable of 
accepting all payment cards bearing the CUP logo; 
(e) China requires that all payment cards, in cluding "dual currency" cards, issued in 
China capable of being used for transactions  denominated and paid in RMB bear the 
CUP logo; and 
(f) China requires that all cross-bank or inter-bank transactions involving payment cards 
be handled through CUP, and similarly, Ch ina prohibits the use of non-CUP payment 
cards for cross-region or cross- bank or inter-bank transactions. 
16. As regards the WTO obligations that are the subj ect of the United States' complaint, the panel 
request identifies China's market access and nati onal treatment obligations under Article XVI:1 and 
XVI:2 and Article XVII of the General Agreement on Trade in Services (GATS).
27 
17. Lastly, the United States' panel request  identifies three separate subsectors ‒ Subsectors (d), 
(k) and (l) from Section II, 7 (Financial Servi ces), B (Banking and Other Financial Services) of 
                                                      
24 For further discussion about the United States' us e of the term "electronic payment services for 
payment card transactions", see in particular paras. 31 and 32 below.  
25 See WT/DS413/2, pp. 2-3. 
26 See WT/DS413/2, p. 2. 
27 See WT/DS413/2, pp. 2-4. WT/DS413/4 
Page 6  
 
  China's Schedule
28 ‒ for which China undertook commitments under Articles XVI and XVII of the 
GATS. These are: 
Banking services as listed below: ... All payment and money transmission services, 
including credit, charge and debit cards, travellers cheques and bankers drafts 
(including import and export settlement); 
Other financial services as listed below: …  Provision and transfer of financial 
information, and financial data processing and related software by supplier of other 
financial services; and 
Advisory, intermediation and other auxiliary  financial services on all activities listed 
in subparagraphs (a) through (k), includi ng credit reference and analysis, investment 
and portfolio research and advice, advi ce on acquisitions and on corporate 
restructuring and strategy.29 
18. Bearing these elements in mind, we now turn to consider whether the United States' panel 
request provides any explanations as to how or why the measures at issue are considered to breach 
China's GATS obligations, or to put it another way,  whether it in any way connects those measures 
with the cited legal provisions. 
19. In considering this issue, we observe, first of all, that the text of the panel request makes it 
clear that each of the requirements30 allegedly imposed by China is c onsidered by the United States to 
be in breach of Articles XVI:1 and XVI:2 and Article XVII of the GATS. In this respect, there is consequently no confusion as to the connection the United States seeks to make between the measures 
at issue and the cited legal provisions. 
20. As noted, the text of the panel request also s upplies a description, albeit a brief one, of what 
the impugned measures are, and it indicates that they are considered to constitute, or result in, market 
access restrictions (Article XVI) and to result in  less favourable treatment (Article XVII) to the 
detriment of foreign suppliers of relevant services.  To that extent, in the Panel’s view, the panel 
request provides an explanation both as to how a nd why the challenged measures are considered to 
breach the two legal provisions. Specifically, th e panel request describes the nature of the 
requirements China allegedly imposes and their effect s, thus informing China and third parties about 
how the measures give rise to the claimed violations of the cited provisions.
31 The request addresses 
the issue of why the measures result in a breach of  China's GATS obligations, inasmuch as it suggests 
that they constitute market access restrictions  or give rise to less favourable treatment.32   
21. Finally, we recall that the United States' pa nel request identifies the subsectors that are 
deemed relevant. This provides a further explanation of why China is considered by the United States 
to have breached its GATS obligations. Essentially, what  this tells China and third parties is that the 
challenged measures are considered to be in breach of Articles XVI:1 and XVI :2 and Article XVII of 
the GATS because, in the United States' view, Ch ina has undertaken commitments in subsectors 
which cover the specific services allegedly affected by the measures at issue.    
                                                      
28 See WT/ACC/CHN/49/Add.2 and WT/MIN(01)/3/Add.2. 
29 See WT/DS413/2, pp. 1-2. 
30 See para. 15 above. 
31 For example, after describing a certain requiremen t, the panel request goes on to discuss its effect: 
"This means that issuing banks must have acce ss to the CUP system …" (WT/DS413/2, p. 2). 
32 For instance, the panel request alleges that CUP is "the only entity" that China permits to supply 
relevant services. Similarly, the request alleges that China imposes certain requirements regarding CUP payment 
cards, but that no similar requirements are imposed regarding non-CUP payment cards (WT/DS413/2, p. 2).   WT/DS413/4 
 Page 7 
 
 
  22. Notwithstanding this, China submits that still more  clarity and explanation are needed before 
the United States' panel request can be deemed to  "present the problem clearly" as required by 
Article 6.2. In particular, and as indicated, Chin a raises concerns over the alleged failure of the 
United States' panel request to connect the measures and services at issue to China's commitments in a 
particular subsector, and to indicate the mode(s) of supply at issue. Accordingly, before forming an 
overall view as to the consistency of the United States ' panel request with the requirement to provide a 
brief summary of the legal basis, we proceed to  examine whether the two concerns put forward by 
China are well founded. We will address these concerns in turn.    
C. CONNECTION BETWEEN THE SERVICES AT IS SUE AND PARTICULAR SUBSECTORS IN CHINA 'S 
SCHEDULE  
23. With regard to the connection of the services at issue to China's commitments in a particular 
subsector, China argues that the United States' pa nel request falls short because it does not explain 
how or why the United States considers the challe nged measures to be inconsistent with China's 
specific commitments in any of th e three identified subsectors.  
24. China submits that, in order to "present the pr oblem clearly, a panel request must identify the 
specific sector or subsector that allegedly covers th e service at issue, or, if there are multiple services 
at issue, plainly associate the services at i ssue with the specific sector or subsector.33 China submits 
that it is well established that sectors and subsectors in a member's schedule are mutually exclusive, 
and that therefore, any service that is the subj ect of a claim under the GATS can fall into only one 
sector or subsector of the member's schedule. 
25. China points out that the United States' panel request provides a singular definition of the 
services at issue ‒ "electronic payment services" ‒ yet relies on China's commitments in three 
different subsectors. China observ es that the term "electronic payment services" is of the United 
States' own making and does not correspond to any of the subsectors that appear in China's Schedule. 
China argues that the United States' panel request doe s not provide an explanation of how the services 
at issue as defined by the United States relate to the specific commitments in  any of the identified 
subsectors.34  Because of this, the United States' pane l request in China's view does not plainly 
connect the services at issue with the specific sector or subsector in its Schedule. According to China, 
the result is that it must prepare its defence based on speculation about the natu re and extent of those 
claims.  
26. The United States requests the Panel to reject  China's arguments. The United States argues 
that its description of the services at issue should not be considered "confus ing" or "prejudicial"35 as 
the term "electronic payment services" is draw n from industry sources and reflects the broad and 
common understanding within this sector of the ser vices at issue. According to the United States, 
suppliers of the services who work within this sect or are described as supplying, or characterize 
themselves as supplying, "electronic payment services"  and as operating within the "global payments 
industry".36  Further, the sector that serves credit, ch arge, debit and other payment card transactions 
characterizes itself as providing "electronic payment services".37 In addition, the United States takes 
issue with China's assertion that the term "electronic payment services for payment card transactions" 
does not correspond to any of the subsectors in Chin a's Schedule. The United States submits that the 
language in Subsector (d) of China's Schedule makes clear that the term "electronic payment services" 
falls within the definition of " all payment and money transmission services, including credit, charge 
                                                      
33 China's preliminary ruling request, para. 8. 
34 China's preliminary ruling request, para. 9. 
35 United States' response to China's preliminary ruling request, paras. 17 and 34. 
36 United States' response to China's preliminar y ruling request, paras. 17, 33, and 35-61. 
37 United States' response to China's preliminary ruling request, paras. 17 and 33. WT/DS413/4 
Page 8  
 
  and debit cards …"
38  The United States also notes that the phrase "all payment and money 
transmission services" in China's Schedule is modi fied with an illustrative list stating that it 
"include[s] credit, charge and debit cards".39  
27. The United States further submits that identifying potentially mutually exclusive claims in the 
United States' panel request is not a failure under Ar ticle 6.2 to provide a summary of the legal basis 
of the complaint. In its view, whether a complain ing party can prevail on separate claims advanced 
under potentially mutually exclusive subsectors is a su bstantive legal issue to be decided on the merits 
based on arguments and evidence that are presented in the course of proceedings. The United States 
contends that by identifying the three subsectors in question, the United States' panel request puts 
China on notice that its market access and national treatment commitments undertaken in its Schedule 
that cover "electronic payment services for payment card transactions" are before the Panel.40  
28. The United States also observes that China seeks a detailed explanation of the US legal 
arguments as to exactly how China's measures put it in breach of its commitments. The United States 
recalls in this respect that it is not required by Ar ticle 6.2 to present its legal arguments in advance of 
the US first written submission.41 
29. China responds that the United States' explan ation of its position underscores the lack of 
clarity in the United States' panel request. Accordi ng to China, the explanation that the services at 
issue fall within Subsector (d) of Section II.7.B of  China's Schedule suggests that the references to 
Subsectors (k) and (l) were a "distraction, at best".42 In the absence of any explanation, one could 
imagine any number of ways in which to relate "e lectronic payment services" to China's commitments 
in Subsectors (d), (k) and (l). Chin a considers, therefore, that it was not self-evident that the United 
States intended to encompass all "electr onic payment services" in Subsector (d).43 China further notes 
that the United States' panel request does not id entify "separate claims" under any of the three 
identified subsectors. China considers that if the United States intended to advance "separate claims" 
under three different and mutually exclusive subs ectors, the time for setting forth these "separate 
claims" was in the panel request.44 
30. The United States responds that China offers no response to the evidence it has put forth to 
rebut China's argument that the term "electr onic payment services" is "somehow confusing".45 
Furthermore, the United States once again rejects Chin a's suggestion that a reference to three mutually 
exclusive subsectors would render a panel request  defective. The United States notes that this 
argument would mean that whenever a complaining party advances mutually exclusive claims, such 
as a claim under Article II of the GATT 1994 and a claim under Article III of the GATT 1994, this 
would render its panel request in consistent with Article 6.2.46 According to the United States, China is 
also wrong to assert that the United States would be re quired to set forth "separate claims" that certain 
aspects of the measures are inconsistent with one su bsector while other aspects are inconsistent with 
other subsectors.47 The United States recalls in this regard its argument that China is not entitled to 
                                                      
38 United States' response to China's preliminary ru ling request, para. 19 (emphasis original); see also 
United States' response to China's preliminary ruling request, paras. 24, 135. 
39 United States' response to China's preliminary ruling request, para. 20. 
40 United States' response to China's preliminary ruling request, paras. 136-138. 
41 United States' response to China's preliminary ruling request, paras. 21 and 23. 
42 China's reply to United States' response, para. 17. 
43 China's reply to United States' response, paras. 16-17. 
44 China's reply to United States' response, paras. 19-20. 
45 United States' comments to China's reply, para. 5. 
46 United States' comments to China's reply, paras. 5 and 15. 
47 In support of its argument, the United States refers to the panel report in EC – Trademarks and 
Geographical Indications (US) , para. 7.2.  WT/DS413/4 
 Page 9 
 
 
  have specific legal arguments presented as to how the measures at issue breach commitments 
identified in the United States' panel request.48 
31. The Panel begins its consideration with some preliminary remarks about the term "electronic 
payment services for payment card transactions", whic h appears in the United States' panel request. 
The term refers to various services that the United States has identified as being covered by its 
complaint, namely those elaborated in two definitional footnotes of the panel request.49 The term was 
also used by the United States in its request for consultations, but the Panel has no information as to 
whether that term was discussed in that context.50 China observes that the term is "of the United 
States' own making" and does not appear in China's Schedule.51  The United States responds that the 
term is "drawn from industry sources and reflect s the broad and common understanding within this 
sector"52, and that the term "electronic payment serv ices" clearly falls within the definition of 
Subsector (d), in Section II.7.B of China's Sc hedule, which concerns "all payment and money 
transmission services, including credit, charge and debit cards".53    
32. China does not appear to assert that the meaning of  the term in question is unclear. Nor does it 
assert that the use of that term in itself gives ri se to an inconsistency with Article 6.2; China's 
complaint rather seems to be that the term does not  appear in its Schedule. We therefore need not 
dwell on the meaning of the term, except to recall th e clarification provided by the Appellate Body to 
the effect that "the identification of the product at issue is generally not a separate and distinct element 
of a panel's terms of  reference; rather, it is a consequence of the scope of application of the specific 
measures at issue. In other words, it is the measur e at issue that generally will define the product at 
issue".54 It is useful to note also that the Appellate Body has cautioned against requiring the 
complaining party to provide an overly detailed de finition of the product that forms the basis of the 
complaint.55 For these reasons, and in the absence of a sp ecific objection from China on the use of the 
term in question, we see no grounds, in the context of this inquiry under Article 6.2, to question its use 
in the United States' panel request or the accompanying definitions.  
33. Having broached the matter of product identifi cation, we now turn to consider China's 
assertion that the United States' panel request fails  to "present the problem clearly" by failing to 
connect the services at issue with the three subsect ors in China's Schedule. In considering this 
assertion, it is important to recall once more that the requirement to "present the problem clearly" 
concerns the connection between the challenge d measures and the cited legal provisions. As 
elaborated above56, by identifying three subsectors, the United States' panel request connects these 
two elements, inasmuch as it makes clear that the measures are claimed to breach the cited provisions 
because there are relevant commitments in subsector s that are considered to cover the measures and 
services at issue.  
34. Having said this, we note that the United Stat es' panel request does not state explicitly how 
"electronic payment services for payment card transac tions" relate to each of the three identified 
subsectors in China's Schedule. For instance, th e request does not say whether the United States 
                                                      
48 United States' comments to Chin a's reply, paras. 16 and 18. 
49 See WT/DS413/2, footnotes 1 and 2.  
50 See WT/DS413/1. The Panel notes that at the firs t meeting of the DSB at which the United States' 
panel request was discussed, China referred to the United States' request for consultations, but only regarding a 
different concern. See WT/DSB/M/293, pp. 15 and 16. 
51 China's preliminary ruling request, paras. 2 and 9. 
52 United States' response to China's preliminar y ruling request, paras. 17, 33, and 35-61. 
53 United States' response to China's preliminary ruling request, para. 19. 
54 Appellate Body Report, EC – Chicken Cuts , para. 165. This case concerned trade in goods. The 
Panel sees no reason, however, why the same reasoning should not apply in the services context as well. 
55 Appellate Body Report, EC – Computer Equipment , para. 71. 
56 See para. 21 above. WT/DS413/4 
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  considers that each, or some, of the services at is sue fall(s) within each of the three identified 
subsectors, and/or whether each, or some, of the se rvices fall(s) within only one subsector, and if so, 
which one in particular. But it can be reasonably inferred from the panel request that, in the United 
States' view, each of the services at issue is covered by at least one of the three subsectors, and that 
none of them is alleged to fa ll within any other subsector.  
35. China seems to consider that the services at i ssue could be covered by only one of the three 
subsectors, because the Appellate Body has f ound that subsectors are mutually exclusive.
57 However, 
even if the three relevant subsectors in China's Schedule were mutually exclusive in relation to 
particular services at issue, we do not consider that the mere fact of including these subsectors in the 
United States' panel request without further explan ation would constitute a failure to "present the 
problem clearly".58 It is also noteworthy that Subsectors (k ) and (l) are related to Subsector (d) of 
Section II.7.B of China's Schedule. Subsector (d ) is listed within "banking services", whereas 
Subsectors (k) and (l) concern "[o]ther financial services". More specifically, Subsector (l) concerns "auxiliary financial services on all activities listed in subparagraphs (a) through (k)".
59 As a result, it 
may not be immediately clear which of the identified subsectors covers a particular service at issue.   
36. In support of its assertion, China also re fers to the Appellate Body report in Korea – Dairy .60  
In our view, China's reliance on this report is mispla ced. In that case, the Appellate Body found that 
the listing of WTO treaty articles might not satisfy the requirement to "present the problem clearly" if any of the cited articles cont ains distinct obligations.
61 The argument that China appears to deduce 
from this is that if there are multiple services at is sue that are claimed to be covered by mutually 
exclusive subsectors, it is not sufficient to list t hose services without associating them with particular 
subsectors in its Schedule.62  It is not apparent to us, however, that the facts of our case can be 
analogized to those in Korea – Dairy . The United States' panel request does not rest solely on a 
single-term description of the services at issue. Rather, as China itself says, it supplies a "lengthy" 
definition of that term and the services it encompasses.63 Moreover, the United States' panel request 
does not merely specify the relevant services sector (financial services), but in addition details all 
relevant subsectors in China's Schedule. To that extent, we consider that China's reliance on the 
Appellate Body report in Korea – Dairy  is misplaced. However, there remains the issue of whether in 
the case of the United States' panel request additional explanations were required as to the relationship 
between specific services and subsectors in order to "present the problem clearly".  
37. In this respect and as indicated above64, the panel request already sets forth some explanations 
as to how and why the challenged measures are consid ered to be in breach of China's obligations 
under Articles XVI and XVII of the GATS. Taking in to account the explanations provided in the 
United States' panel request as well as all other in formation that it contains or references, the 
additional explanations that China is seeking in re lation to the identified subsectors are in our view 
not required, in the circumstances of this case, to allow China to "begin" to prepare its defence. It 
should also be remembered in this respect that Article 6.2 requires a "brief" summary of the legal 
                                                      
57 China refers to the Appellate Body Report in US – Gambling , para. 180; China's preliminary ruling 
request, para. 8. 
58 Along similar lines, another panel expressed the view that panel requests are not inconsistent with 
Article 6.2 merely because they do not explain why legal provisions are cited as lega l bases even though these 
provisions may be mutually exclusive (Panel Report,  EC – Approval and Marketing of Biotech Products , 
para. 88 of the Preliminary Ruling, reproduced at para. 7.47). 
59 Section II.7 (Financial Services), B (Banking and Other Financial Services) of the Schedule 
(circulated in WT/ACC/CHN/49/Add .2 and WT/MIN(01)/3/Add.2). 
60 China's preliminary ruling request, para. 7. 
61 Appellate Body Report, Korea – Dairy , para. 124. 
62 China's preliminary ruling request, paras. 7-8. 
63 China's preliminary ruling request, para. 2. 
64 See paras. 19 and 20 above.  WT/DS413/4 
 Page 11 
 
 
  basis, and China should not, therefore, expect to receive explanations so detailed that they would 
enable it to "finish" preparing its defen ce on the sole basis of the panel request.65 Indeed, during the 
course of the panel proceedings, China will have fu rther opportunities to prepare its defence, notably 
after receiving the US first written submission a nd in advance of submitting its own first written 
submission. At any rate, the United States' panel request identifies the speci fic measures at issue, 
including a list of the relevant "instruments", prov ides a detailed description of what is covered by the 
term "electronic payments services for payment card transactions", exhaustively circumscribes the relevant subsectors, and also allows certain infere nces to be drawn as to the relationship between the 
services at issue and the relevant subsectors in Chin a's Schedule. With that information, it should be 
possible for China and the third parties to make at  least an initial determination as to whether the 
services at issue are covered by the identified subsectors.    
38. Beyond this, we recall that a panel request need s to set out only the claims being put forward. 
A complaining party is not required to include in its panel request arguments and evidence to 
demonstrate that the responding party's measures infringe upon the identified WTO provisions. We 
consider that requiring the United States to explai n in its panel request exactly how the services at 
issue relate to the three identified subsectors would,  on the facts of this case, amount to requiring the 
United States to provide, in its panel request, pr ecise arguments in support of its claims that the 
specific measures at issue are in breach of China' s obligations under Articles XVI:1 and XVI:2 and 
Article XVII of the GATS.  
D. L
ACK OF AN EXPLICIT INDICATION AS TO THE RELEVANT MODES OF SUPPLY  
39. As indicated above, China alleges that the Unite d States' panel request suffers from additional 
deficiencies in that the panel request fails to pr ovide any indication of which mode, or modes, of 
supply the United States considers to be at issue. Chin a notes in this respect that the nature and extent 
of China's market access and national treatment obliga tions in the three subsectors identified in the 
panel request depend, inter alia , on the mode of supply. China also asserts that the United States' 
panel request should have explained how the cha llenged measures are inconsistent with China's 
commitments under the relevant modes of supply. Ch ina submits that due to these deficiencies, the 
United States' panel request has failed to "presen t the problem clearly" as required by Article 6.2.66 
40. China submits that given the importance of th e modes of supply to the architecture of the 
GATS, it is hard to see how a complaining party can "present the problem clearly" if it does not 
indicate in the panel request which modes of supply are at issue. According to China, this is especially 
true where, as in this case, the responding party has made different commitments in the different 
modes of supply. China notes that China's commitments under modes 1 and 3 concerning "payment 
and money transmission services" (Subsector (d) in Section II.7.B of China's Schedule) serve to 
illustrate this point. China observes that to assert a cl aim under mode 3, for instance, the United States 
would have to allege that what it calls "electr onic payment services suppliers" are "foreign financial 
institutions" that meet the requirements specified in China's Schedule, and explain why it considers 
this to be true.67 
41. China further points out that in other disputes arising under the GATS, the complaining party 
identified in its panel request which modes of suppl y were at issue, and explained how the challenged 
measures related to those modes of supply.68 China further cites an example of a case where the 
                                                      
65 Panel Report, Australia – Apples , para. 7.929. 
66 China's preliminary ruling request, paras. 3, 11, and 13. 
67 China's preliminary ruling request, paras. 10-11. 
68 China refers to the following panel requests: China – Publications and Audiovisual Products  
(WT/DS363/5), Mexico – Telecoms (WT/DS204/3), US – Gambling (WT/DS285/2) and Canada – Autos  
(WT/DS142/2). WT/DS413/4 
Page 12  
 
  complaining party in its panel request explained how limitations or conditions on market access or 
national treatment in the relevant mode(s) of supply related to the claims at issue.
69 China contends 
that in the present dispute, the United States' pa nel request is silent on these aspects of the US 
claims.70  
42. China argues that due to the above-noted defici encies, it had to begin preparing its defence 
based on nothing more than speculation about the natu re and extent of the US claims. China submits 
that it should not be left to wonder what specific claims have been made against it.71 
43. The United States counters that for each of th e subsectors identified in the United States' 
panel request, China undertook both market access and national treatment commitments for modes 1 
and 3 as specified in its Schedule. The United States  also points outs that the commitments for each 
mode of supply for Subsectors (d), (k) and (l) in Section II.7.B of China's Schedule are specified 
therein. According to the United States, the pane l request thus puts China on notice as to which of 
China's market access and national treatment commitm ents, including the modes of supply, are before 
the Panel.72 
44. The United States argues that in its request for a preliminary ruling China appears to 
acknowledge the claims that are before the Panel in  light of the United States' panel request, but in 
addition seeks a detailed legal explanation of exact ly how China's measures put it in breach of its 
commitments. In the United States' view, China is not, however, entitled to see in advance of the US 
first submission how the United States will present its legal arguments.73 
45. With regard to the issue of identification of the modes of supply, the United States therefore 
considers that China's arguments ar e without merit. The United States contends that its panel request 
is fully consistent with Article 6.2. 
46. China responds that the United States attempts  to rectify a deficient panel request in a 
subsequent submission. According to China, the Un ited States in its comments on China's preliminary 
ruling request appears to be explaining: (i) that it considers its claims to arise under modes 1 and 3; and (ii) that because modes 1 and 3 are among the f our modes of supply, the panel request put China 
on notice as to which modes of supply were at issue. China points out, however, that the 
United States' panel request makes no reference to the modes of supply and that the United States 
supplied an explanation that is altogether absent fro m the panel request. Also, in China's view, the fact 
that modes 1 and 3 are among the four possible modes of supply did not, by itself, put China on notice as to which modes were at issue and provide a sufficient basis for China to begin preparing its defence.
74 
47. The United States responds that there is no b asis for any alleged confusion regarding the 
modes of supply at issue, as those modes are set out  in the commitments explicitly identified in the 
United States' panel request. The United States consid ers "remarkable" the apparent position of China 
that it is uncertain as to the modes at issue with  regard to the GATS commitments it has undertaken.75 
The United States notes that with regard to each of the subsectors identified in the United States' panel 
request, China undertook both market access and nati onal treatment commitments for modes 1 and 3 
as specified in its Schedule. According to the United States, the commitments for each mode of 
                                                      
69 China refers to the panel request in China – Publications and Audiovisual Products  (WT/DS363/5). 
70 China's preliminary ruling request, para. 11. 
71 China's preliminary ruling request, paras. 13-14. 
72 United States' response to China's preliminary ruling request, paras. 22 and 136. 
73 United States' response to China's preliminary ruling request, paras. 22 and 137.  
74 China's reply to United States' response, paras. 10-12. 
75 United States' comments to China's reply, para. 17.  WT/DS413/4 
 Page 13 
 
 
  supply for Subsectors (d), (k) and (l) in China's Sc hedule are specified therein, and the United States' 
panel request thus puts China on notice as to China's market access and national treatment 
commitments, including the modes of supply, that are before the Panel.76 
48. The Panel notes that the United States' panel re quest does not explicitly identify any modes of 
supply. It is clear from the request, however, that in the United States' view, China has undertaken 
market access and national treatment commitments in  three identified subsectors that cover electronic 
payment services for payment card transactions.77 The United States argues that China therefore has 
notice as to which of its market access and nationa l treatment commitments, including the modes of 
supply, are before the Panel.  
49. In considering this argument, we note that, on its face, the United States' panel request does 
not reveal an intention to limit claims to only certa in modes of supply. In those circumstances, it is 
reasonable to infer that the United States wishes to  be able to base its claims on relevant market 
access and national treatment commitments under any corresponding modes of supply. Consequently, 
where China's Schedule sets forth a relevant commi tment in a relevant subsector, the corresponding 
mode of supply can on the facts of this case be assumed to  be at issue, whether it is mode 1, 2, 3 or 4. 
We are therefore of the view that although the Unite d States' panel request does not explicitly indicate 
which modes of supply the United States considers to be at issue, the modes at issue are nonetheless 
ascertainable from the request, notably via the reference to the relevant subsectors.  
50. Accordingly, and due notably to the fact that the United States' panel request identifies three 
distinct subsectors, the request giv es notice to China, and the third par ties, that a substantial number of 
China's market access and national treatment commitmen ts are at issue. This does not mean, however, 
that China is not in a position to begin preparing its  defence. Rather, it means that in beginning that 
task, China may need to cover a lot of ground, or as China calls it, "permutations".78 In the instant 
case, we do not consider that this is objectionable in and of itself.79 Indeed, it must be remembered 
that the United States is not prohibited under Article  6.2 from including in its panel request claims on 
any of China's commitments that it considers to be  applicable to the cha llenged measures, while 
remaining free to decide subsequently not to pursu e claims based on certain of those commitments. It 
should also be recalled that the United States' pane l request identifies the sp ecific measures at issue, 
including a list of the relevant "instruments". Th is information should assist China in forming a view 
as to whether a particular measure is or is no t subject to a market access or national treatment 
commitment concerning a particular mode of supply.  
51. China submits that the United States' panel requ est is defective also because it fails to explain 
how the challenged measures are inconsistent with China's commitments under the relevant modes of 
supply.80 We are not persuaded that the United States' panel request needs to provide this type of 
explanation in order for it to "present the problem clearly". As indicated above81, the panel request 
sets forth explanations as to how and why the challe nged measures are considered to be in breach of 
China's obligations under Articles XVI and XVII of the GATS. Taking into account the explanations 
already provided in the United States' panel request as  well as all other information that it contains or 
references, the additional explanations that China is seeking are in our view not required, in the 
                                                      
76 United States' comments to China's reply, paras. 6 and 17. 
77 See WT/DS413/2, p. 2, where it is stated that "[ d]espite those commitments [of China]", China has 
imposed restrictions on electronic paym ent services suppliers of other Memb ers that are considered to be in 
breach of China's GATS obligations.  
78 China's preliminary ruling request, para. 12. 
79 We note that a similar view was expressed by a previous panel. See para. 101 of the Preliminary 
Ruling, which is reproduced at para. 7.47 of the Panel Report in EC – Approval and Marketing of Biotech 
Products .  
80 China's preliminary ruling request, para. 11. 
81 See paras. 19 and 20 above. WT/DS413/4 
Page 14  
 
  circumstances of this case, to allow China to "beg in" preparing its defence. As we have said, China 
should not expect to be able to "finish" preparing its defence on the sole basis of the summary to be 
provided in the panel request.  
52. Moreover, we recall that a panel request needs to  set out only the complaining party's claims, 
not the arguments in support of those claims.
82 We consider that requiring the United States to explain 
in its panel request how or why the challenged m easures are inconsistent with China's commitments 
under the relevant modes of supply would, on the facts of this case, amount to requiring the United States to provide precise arguments in support of its claims.  
53. Regarding the examples cited by China of other panel requests
83, we agree with China that 
they are more explicit in providing information on  relevant modes of supply and commitments than 
the panel request submitted in this dispute.84  As a general matter, we agree that it would be desirable 
for complaining parties to strive to provide explic it information about the GATS claims at issue where 
this is possible without compromising the case they plan to make.85 Not least, this might go some way 
towards forestalling procedural objections under Article 6.2, which, as our case shows, impose 
additional work on panels and the parties that detracts from that to be devoted to addressing the 
substance of complaining parties' cl aims. However, the issue before us is not what is desirable, but 
what is necessary, on the merits of each case, to me et the requirements of Ar ticle 6.2. Applying those 
requirements to the panel request at hand and w ithout prejudging whether it might in other cases be 
necessary to indicate the modes of supply at issue, we  are satisfied that further details on relevant 
modes of supply and commitments are not necessary in this case.  
54. For the reasons given above, we reject China's assertion that the United States' panel request 
fails to inform China as to which modes of supply ar e at issue. We also conclude that, contrary to 
China's assertion, the United States' panel request considered as a whole does not need to explain 
further how the challenged measures are inconsiste nt with China's commitments under the relevant 
modes of supply.  
E. CONCLUSION  
55. As is clear from the foregoing, we do not agree with China's assertion that on the facts of this 
case, the United States' panel request needs to (i) pr ovide further explanation so as to connect plainly 
the measures and services at issue to China's commitments in a particular subsector; or (ii) indicate explicitly which modes of supply are at issue and explain how the measures are inconsistent with 
China's commitments under these modes.  
56. In coming to this conclusion,  we have taken into account, inter alia , the fact that the 
United States' panel request provides a substantial am ount of relevant information. We recall in this 
regard that the United States' panel request estab lishes a connection between each of the challenged 
measures and each of the cited legal provisions.  In  our assessment, the United States' panel request 
connects these two elements "plainly"
86. Furthermore, as we have also observed, the United States' 
panel request offers explanations both as to how a nd why those measures are considered to put China 
in breach of its obligations under Articles XVI: 1 and XVI:2 and XVII of the GATS. While the 
                                                      
82 Appellate Body Report, EC – Bananas III , para. 141. 
83 See China's preliminary ru ling request, footnote 8. 
84 We note, though, that the panel request in the dispute EC – Bananas III  did not specify the modes of 
supply at issue. See WT/DS27/6. 
85 See Appellate Body Report, India – Patents  (US) , para. 94. 
86 Appellate Body Report, US – Oil Country Tubular Goods Sunset Reviews , para. 162.  WT/DS413/4 
 Page 15 
 
 
  explanations given are concise, the Appellate Body has clarified that the requirement in Article 6.2 is 
to explain "succinctly" how or why an inconsistenc y with WTO obligations is considered to arise.87        
57. In the light of these elements, we are unable to agree with China that without additional 
information and explanations on the issues of concer n to it, the United States' panel request leaves 
China to speculate about the cl aims that are being made. In our view, the summary that the 
United States' panel request provides of the legal basis is sufficient to "present the problem clearly". 
In particular, we consider that it gives China adequa te notice as to the case it has to answer and allows 
it to begin preparing its defence. We are not pers uaded, therefore, that additional information or 
explanations of the kind China is seeking are needed for the US panel request to satisfy the 
requirement in Article 6.2 to provide a brief su mmary of the legal basis sufficient to present the 
problem clearly. 
IV. OVERALL CONCLUSION 
58. Overall, we thus conclude that China has fa iled to establish that the United States' panel 
request is inconsistent with Article 6.2 of the DSU on the grounds that it does not provide a brief 
summary of the legal basis sufficient to present the problem clearly. Accordingly, we reject China's 
preliminary objection of 5 July 2011 and will cont inue our consideration of  this case in accordance 
with the timetable that has b een set for these proceedings.  
 
_______________ 
 
                                                      
87 Appellate Body Report, EC – Selected Customs Matters , para. 130. See also Appellate Body Report, 
Korea – Dairy , para. 120 (stating that the summary of the legal basis may be a brief one). WT/DS413/4 
Page 16  
 
  ANNEX A: 
 
TABLE OF WTO CASES CITED IN THIS PRELIMINARY RULING 
 
Short Title Full Case Title and Citation 
Australia – Apples Appellate Body Report, Australia – Measures Affecting the Importation of 
Apples from New Zealand , WT/DS367/AB/R, adopted 17 December 2010 
Australia – Apples Panel Report, Australia – Measures Affecting the Importation of Apples from 
New Zealand , WT/DS367/R, adopted 17 December 2010, as modified by 
Appellate Body Report WT/DS367/AB/R 
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 – Computer Equipment Appellate Body Report, European Communities – Customs Classification of 
Certain Computer Equipment , WT/DS62/AB/R, WT/DS67/AB/R, 
WT/DS68/AB/R, adopted 22 June 1998, DSR 1998:V, 1851 
EC – Selected Customs Matters Appellate Body Report, European Communities – Selected Customs Matters , 
WT/DS315/AB/R, adop ted 11 December 2006,  DSR 2006:IX, 3791 
EC – Trademarks and 
Geographical Indications 
(US) Panel Report,  European Communities – Protection of Trademarks and 
Geographical Indications for Agricultural Products and Foodstuffs, 
Complaint by the United States , WT/DS174/R, adopted 20 April 2005, DSR 
2005:VIII, 3499 
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 
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 
Mexico – Corn Syrup Panel Report, Mexico – Anti-Dumping Investigatio n of High Fructose Corn 
Syrup (HFCS) from the United States , WT/DS132/R, adopted 24 February 
2000, and Corr.1, DSR 2000:III, 1345 
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 – Continued Zeroing Appellate Body Report, United States – Continued Existence and Application 
of Zeroing Methodolog y, WT/DS350/AB/R, adopted 19 February 2009  WT/DS413/4 
 Page 17 
 
 
  Short Title Full Case Title and Citation 
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 – 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 
 
 
__________