WORLD TRADE  
ORGANIZATION  TN/DS/W/82/Add.1 
25 October 2005 
 
 (05-4907) 
Dispute Settlement Body 
Special Session Original:   English 
 
 
 
NEGOTIATIONS ON IMPROVEMENTS AND CLARIFICATIONS OF 
THE DISPUTE SETTLEMENT UNDERSTANDING 
 
Further Contribution of the United States on Improving Flexibility  
and Member Control in WTO Dispute Settlement  
 
Communication from the United States  
 
Addendum  
 
 
 The following communication, dated 24 October 2005, is being circulated at the request of the delegation of the United States.  
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 III(B). Draft Parameters Concerning the Interpre tive Approach to Use in WTO Dispute Settlement
 
 In light of the questions posed in TN/DS/W/74 and the useful and enlightening discussion with other 
Members to date, it is suggested that the following parameters reflect a proper interpretive approach 
to use in WTO dispute settlement:  
WTO adjudicative bodies are constrained from addi ng to or diminishing the covered agreements
 
 
Articles 3.2 and 19.2 of the DSU provide that recommendations and rulings of the DSB "cannot add to or diminish the rights and obligations provided in  the covered agreements."  This means that WTO 
adjudicative bodies must take care that any interpre tive approach they may use results neither in 
supplementing nor in reducing the rights and oblig ations of Members under the covered agreements. 
 
The covered agreements reflect differing negotiating objectives and positions
 
 The covered agreements are the result of nego tiations among sovereign nations and autonomous 
customs territories.  Negotiations inherently en tail a number of compromises.  Agreement by 
participants on particular terms in a covered ag reement does not mean that all WTO Members have 
agreed on the same underlying approach or rationale for those terms.  Some participants may have 
wanted stronger rules or disciplines that went further in a particular area, while other participants may 
not have wanted rules as strong or disciplines that went as  far.  It is for this reason that the text of the 
covered agreements is the best representation of the expectations of WTO Members.  The differences in approach and perspective also  mean that, when interpreting a provision of a 
covered agreement, while other provisions of the c overed agreements may serve as useful context, it 
is not possible to deduce from the existence of ce rtain provisions that WTO Members have agreed on 
a particular underlying policy and that this polic y may be used as a guideline to interpret other TN/DS/W/82/Add.1 
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 provisions.  In other words, it is not appropriate to extrapolate from the fact that Members have agreed 
to move in a particular direction in one provisi on and conclude that therefore Members must have 
intended another provision to move equally in the sam e direction.  It often may be possible to reach 
agreement only on one particular obligation or di scipline while being unable to reach agreement on 
any obligation or discipline even in a related area. 
 
The covered agreements embody constructive ambiguity
 
 
Customary international law rules of treaty interp retation, reflected in Articles 31 through 33 of the 
Vienna Convention on the Law of Treaties, rec ognize that an examination in accordance with the 
general rule reflected in Article 31 of the Vie nna Convention may result in a meaning that is 
ambiguous, and that resort to the supplementary means of interpretation in Article 32 may be 
necessary.1  Typically such analysis will permit a determ ination of the meaning of the terms of the 
treaty, although there is no guarantee that recour se to supplementary means of interpretation will 
always resolve that ambiguity.   
 
Sometimes that ambiguity is deliberate.  In some  circumstances, reaching agreement on the terms of 
the covered agreements may have necessitated the u se of constructive ambiguity in a provision of a 
covered agreement where the negotiators leave unr esolved particular issues by agreeing on language 
that does not resolve the issue and is capable of mo re than one interpretation.  Constructive ambiguity 
can serve as a placeholder marking an area where ne gotiators accept that it may be appropriate to 
agree on disciplines but where further negotiation is necessary before those disciplines can be 
specified.  WTO adjudicative bodies are not called to determine if ambiguity is deliberate.  Ambiguity is ascertained from an examination of the text.  WTO adjudicative bodies will determine whether the 
meaning of a text is ambiguous after applying the cu stomary rules of interpretation and in light of the 
evidence and argument presented by the parties to th e dispute.  There is no separate requirement to 
establish the intent behind or reason for the ambiguity.    
Gap-filling
 
 
In light of the nature of the covered agreements, there are at least two ways in which "gaps" in a 
covered agreement could be unacceptably fille d, other than thro ugh negotiation.   
 
First would be to read into the text of a covere d agreement an obligation or right that is not 
present in the text, for example by extrapolating from a different provision2   
 
Second  would be to resolve ambiguity in the text  of a covered agreement in a manner that  
supplements or diminishes rights and ob ligations under the covered agreement. 
 Neither type of "gap-filling" is an appropriate function for WTO adjudicative bodies.  Rather, the 
function of WTO adjudicative bodies is to resolve disputes over obligations undertaken, not to 
substitute for negotiators a nd re-write, reduce or supplement the agreed text. 
 With respect to the first type of gap-filling, ther e have been several instances in which the Appellate 
Body has found that a panel has gone beyond the terms of a covered ag reement and imputed 
obligations that were not present in the text.  The A ppellate Body has correctly found that this is cause 
                                                     
 
1  See for example Article 32(a) of the VCLT. 
2 Some commentators would give as an example of extrapolation a situation where a treaty interpreter 
argues that "if the ne gotiators agreed on x in this provision over here, then they must  have intended to agree on y 
in this other provision."  TN/DS/W/82/Add.1 
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 for overturning panel findings.  It is important to respect the limits  of the agreement negotiated.  A 
Member signing a covered agreement indicates by its si gnature that it is agreeing to the text of that 
agreement.  The Member is not indicating its acceptance to go beyond the text of that agreement.  Similarly, prior reports of WTO adjudicative bodi es are not covered agreements.  They do not 
themselves represent agreed text.  Accordingly, it is not appropriate to treat or interpret a prior report 
as though it is agreement text or to use a prior report to add to or diminish rights and obligations under 
a covered agreement.  With respect to the second type of gap-filling, wher e the application of the customary rules of treaty 
interpretation leaves the meaning of a provisi on ambiguous, e.g., there may be two plausibly 
meanings, a WTO adjudicative body should use that language as the basis for validating a claim or a 
defense where that validation would requ ire foreclosing one of those meanings. 
 WTO Members have agreed that the WTO dispute settle ment system is not to add to or diminish the 
rights and obligations under the covered agreements .  They have not agreed to delegate to WTO 
adjudicative bodies the task of filling in  gaps in the covered agreements. 
  
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