WORLD TRADE  
ORGANIZATION  WT/DS269/13 
WT/DS286/15 20 February 2006 
 
(06-0702) 
 Original:   English 
  
 
     
 
    
 
   
EUROPEAN COMMUNITIES – CU STOMS CLASSIFICATION 
OF FROZEN BONELE SS CHICKEN CUTS 
 
 
ARB-2005-4/21 
    
Arbitration 
under Article 21.3(c) of the 
Understanding on Rules and Procedures 
Governing the Settlement of Disputes 
 
 
 
 
    
 
Award of the Arbitrator 
James Bacchus 
  WT/DS269/13 
WT/DS286/15 
 Page i 
 
 
I. Introduction................................................................................................................... ..............1  
II. Arguments of the Parties....................................................................................................... ......2  
A. European Communities ..................................................................................................2  
B. Complaining Parties ......................................................................................................7  
1. Brazil.................................................................................................................7  
2. Thailand ..........................................................................................................11  
III. Reasonable Period of Time...................................................................................................... .14 
A. Ruling from the World Customs Organization ............................................................18  
B. Steps Under Community Law .......................................................................................24  
C. Article 21.2 of the DSU ................................................................................................32  
IV. The Award ...................................................................................................................... ..........33  
 
  
 
 WT/DS269/13 
WT/DS286/15 Page ii 
 
 
TABLE OF AWARDS AND CASES CITED IN THIS AWARD 
 
Short Title Full Title and Citation 
Australia – Salmon Award of the Arbitrator, Australia – Measures Affecting Importation of 
Salmon – Arbitration under Article 21.3(c) of the DSU , WT/DS18/9, 
23 February 1999, DSR 1999:I, 267 
Canada – Autos Award of the Arbitrator, Canada – Certain Measures Affecting the 
Automotive Industry – Arbitration under Article 21.3(c) of the DSU , 
WT/DS139/12, WT/DS142/12, 4 October 2000, DSR 2000:X, 5079 
Canada – Patent Term Award of the Arbitrator, Canada – Term of Patent Protection – Arbitration 
under Article 21.3(c) of the DSU , WT/DS170/10, 28 February 2001, 
DSR 2001:V, 2031 
Canada – Pharmaceutical Patents Award of the Arbitrator, Canada – Patent Protection of Pharmaceutical 
Products – Arbitration under Article 21.3(c) of the DSU , WT/DS114/13, 
18 August 2000, DSR 2002:I, 3 
Chile – Price Band System Award of the Arbitrator, Chile – Price Band System and Safeguard Measures 
Relating to Certain Agricultural Products – Arbitration under Article 21.3(c) 
of the DSU , WT/DS207/13, 17 March 2003 
EC – Chicken Cuts Appellate Body Report, European Communities – Customs Classification 
of Frozen Boneless Chicken Cuts , WT/DS269/AB/R, WT/DS286/AB/R, 
and Corr.1, adopted 27 September 2005 
EC – Chicken Cuts Panel Reports, European Communities – Customs Classification of Frozen 
Boneless Chicken Cuts , WT/DS269/R ( Brazil ), and WT/DS286/R 
(Thailand ), adopted 27 September 2005, as modified by Appellate Body 
Report, WT/DS269/AB/R, WT/DS286/AB/R 
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 – Export Subsidies on Sugar Award of the Arbitrator, European Communities – Export Subsidies on 
Sugar – Arbitration under Article 21.3(c) of the DSU , WT/DS265/33, 
WT/DS266/33, WT/DS283/14, 28 October 2005 
EC – Hormones Award of the Arbitrator, EC Measures Concerning Meat and Meat 
Products (Hormones) – Arbitration under Article 21.3(c) of the DSU , 
WT/DS26/15, WT/DS48/13, 29 May 1998, DSR 1998:V, 1833 
EC – Tariff Preferences Award of the Arbitrator, European Communities – Conditions for the 
Granting of Tariff Preference s to Developing Countries  – Arbitration under 
Article 21.3(c) of the DSU , WT/DS246/14, 20 September 2004 
Korea – Alcoholic Beverages Award of the Arbitrator, Korea – Taxes on Alcoholic Beverages – 
Arbitration under Article 21.3(c) of the DSU , WT/DS75/16, WT/DS84/14, 
4 June 1999, DSR 1999:II, 937 
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 
US – Gambling Award of the Arbitrator, United States – Measures Affecting the Cross-
Border Supply of Gambling and Betting Services – Arbitration under 
Article 21.3(c) of the DSU , WT/DS285/13, 19 August 2005 
   WT/DS269/13 
WT/DS286/15 
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Short Title Full 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 
US – Hot-Rolled Steel Award of the Arbitrator, United States – Anti-Dumping Measures on Certain 
Hot-Rolled Steel Products from Japan – Arbitration under Article 21.3(c) of the DSU , WT/DS184/13, 19 February 2002, DSR 2002:IV, 1389 
US – Offset Act 
(Byrd Amendment ) Award of the Arbitrator, United States – Continued Dumping and Subsidy 
Offset Act of 2000 – Arbitration under Article 21.3(c) of the DSU , 
WT/DS217/14, WT/DS234/22, 13 June 2003 
US – Oil Country Tubular Goods Sunset Reviews Award of the Arbitrator, United States – Sunset Reviews of Anti-Dumping 
Measures on Oil Country Tubular Goods from Argentina  – Arbitration 
under Article 21.3(c) of the DSU , WT/DS268/12, 7 June 2005 
US – Section 110(5) Copyright Act Award of the Arbitrator, United States – Section 110(5) of the US Copyright 
Act – Arbitration under Article 21.3(c) of the DSU , WT/DS160/12, 
15 January 2001, DSR 2001:II, 657 
  WT/DS269/13 
WT/DS286/15 
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WORLD TRADE ORGANIZATION  
AWARD OF THE ARBITRATOR  
 
 
European Communities – Customs Classification 
of Frozen Boneless Chicken Cuts 
 
 
Parties: 
 
Brazil 
European Communities Thailand 
 
   ARB-2005-4/21 
  Arbitrator: 
 
 James Bacchus  
  
I. Introduction 
1. On 27 September 2005, the Dispute Settlement Body (the "DSB") adopted the Appellate 
Body Report
1 and the Panel Reports2, as modified by the Appellate Body Report, in European 
Communities – Customs Classification of Frozen Boneless Chicken Cuts .3  At the meeting of the DSB 
held on 18 October 2005, the European Communiti es stated that it intended to comply with the 
recommendations and rulings of the DSB in this disput e, and that it would need a reasonable period of 
time in which to do so.4 
2. On 22 November 2005, Brazil informed the DS B that consultations with the European 
Communities had not resulted in an agreement on th e reasonable period of time for implementation.  
Brazil therefore requested that such period be dete rmined through binding arbitration, pursuant to 
Article 21.3(c) of the  Understanding on Rules and Procedures Governing the Settlement of Disputes  
(the "DSU").5  Thailand similarly informed the DSB, on 9 December 2005, that it had been unable to 
                                                      
1Appellate Body Report, WT/DS269/AB/R, WT/DS286/AB/R. 
2Panel Reports, WT/DS269/R, WT/DS286/R.  This cas e involved two complaining parties (Brazil and 
Thailand) and one responding party (the European Communities).  Before the Panel, the European Communities requested, pursuant to Article 9.2 of the DSU, that the Panel issue two separate reports.  These two reports had 
the same descriptive part and findings;  the only "mat erial difference" between these separate reports was the 
cover page and the conclusions.  (Appellate Body Report, footnote 1 to para. 1 (quoting Panel Reports, para. 6.21))  The Appellate Body issued one Report  addressing the appeals of  Brazil, the European 
Communities, and Thailand from both Panel Reports. 
3WT/DS269/10, WT/DS286/12. 
4WT/DSB/M/199, para. 30. 
5WT/DS269/11. WT/DS269/13 
WT/DS286/15 Page 2 
 
 
reach agreement with the European Communities on the reasonable period of time for 
implementation, and requested arbitration pursuant to Article 21.3(c) of the DSU.
6   
3. By joint letter of 9 December 2005, Brazil a nd the European Communities requested me to 
act as Arbitrator, pursuant to Article 21.3(c) of th e DSU, to determine the reasonable period of time 
for implementation of the recommendations a nd rulings of the DSB in this dispute.7  Thailand and the 
European Communities also requested, by joint letter of 13 December 2005, that I serve as Arbitrator.
8  As the 90-day period following adoption of th e Panel and Appellate Body Reports was to 
expire on 26 December 2005, the parties, in their re spective letters, "confirm[ed] that the award of the 
arbitrator within the time period to be agreed shall be  deemed to be the award of the arbitrator for the 
purpose of Article 21.3(c) of the DSU."9  I accepted the appointments on 14 December 2005 and 
proposed to conduct both proceedings simultaneously, undertaking to issue the Award no later than 
20 February 2006.10  No party objected to the proposed date for circulation of the Award. 
4. The European Communities filed its written submission on 6 January 2006.  Brazil and 
Thailand each filed its written submission on 13 Ja nuary 2006.  An oral hearing was held on 
26 January 2006.     
II. Arguments of the Parties 
A. European Communities 
5. The European Communities requests that I dete rmine the "reasonable period of time" for 
implementation of the recommendations and rulings of  the DSB in this dispute to be 26 months from 
the date of adoption by the DSB of the Panel a nd Appellate Body Reports , until 27 November 2007. 
6. The European Communities identifies two measu res challenged in this  dispute and found by 
the Panel and the Appellate Body to be inconsis tent with Articles II:1(a) and II:1(b) of the General 
Agreement on Tariffs and Trade 1994  (the "GATT 1994"):  Regulation 1223/2002 of the European 
Commission (the "Commission") and Commission Decision 2003/97/EC.  Because the "effects" of 
                                                      
6WT/DS286/13. 
7WT/DS269/12. 
8WT/DS286/14. 
9Letter from Brazil and the European Communities to the Appellate Body Secretariat, dated 
9 December 2005, p. 2;  letter from Thailand and the Eu ropean Communities to  the Appellate Body Secretariat, 
dated 13 December 2005, p. 1.  
10WT/DS269/12;  WT/DS286/14;  letter from the Arb itrator to Brazil, the Eu ropean Communities, and 
Thailand, dated 14 December 2005, p. 1.  WT/DS269/13 
WT/DS286/15 
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the DSB's recommendations and rulings "go beyond" these measures11, however, the European 
Communities asserts that it must also "repeal[]" or "effectively update[]"12 other Community 
measures, namely:  Additional Note 7 to headi ng 02.10 of the European Communities' Combined 
Nomenclature;  the Dinter13 and Gausepohl14 judgments of the European Court of Justice (the "ECJ");  
as well as certain Explanatory Notes of the Combined Nomenclature.  
7. The European Communities proposes to implem ent the DSB's recommendations and rulings 
in this dispute by the following steps:  (1) seek ing a decision from the World Customs Organization 
(the "WCO") "confirming the interpretation of Ch apter 02.10 of the [Harmonized System] provided 
by the panel and the Appellate Body and verify ing whether, upon confirmation, ... heading 02.10 as 
opposed to heading 02.07 is the correct classification of the product at issue"15;  (2) on the basis of 
this decision of the WCO, adopting a Commissi on Regulation amending Additional Note 7 to 
heading 02.10 of the European Communities' Co mbined Nomenclature;  and (3) if necessary, 
depending on the decision of the WCO, amendi ng additional Explanatory Notes of the Combined 
Nomenclature and adopting a "classif ication regulation" with respect to the product at issue in this 
dispute.16 
8. The European Communities emphasizes that it  is the prerogative of the implementing 
Member to select the means of implem entation that it deems "most appropriate".17  Only after the 
Member has selected how it will implement the DSB's recommendations and rulings should an 
arbitrator consider whether the proposed reasonable pe riod of time is "the shortest period possible" for 
the anticipated means of implementation w ithin the legal system of that Member.18  S u c h  
                                                      
11European Communities' submission, para. 25. 
12European Communities' submission, para. 28. 
13European Court of Justice, Judgment, Dinter v Hauptzollamt Köln-Deutz , Case C-175/82, 
ECR [1983] 969 (Exhibit-EC-12 submitted by the European Communities to the Panel). 
14European Court of Justice, Judgment, Gausepohl-Fleisch GmbH v. Oberfinanzdirektion Hamburg , 
Case C-33/92, ECR [1993] I-3047 (Exhibit EC-14 submitted by the European Communities to the Panel). 
15European Communities' submission, para. 30. 
16European Communities' submission, para. 32. 
17European Communities' submission, para. 19. 
18European Communities' submission, para . 18 (citing Award of the Arbitrator, EC – Hormones , 
para. 26;  Award of the Arbitrator, Australia - Salmon , para. 38;  Award of the Arbitrator, Korea – Alcoholic 
Beverages , para. 37;  Award of the Arbitrator, Canada – Autos , para. 41;  Award of the Arbitrator, Canada – 
Patent Term , para. 38;  Award of the Arbitrator, US – Offset Act (Byrd Amendment) , para. 42;  Award of the 
Arbitrator, EC – Tariff Preferences , para 26;  Award of the Arbitrator, US – Oil Country Tubular Goods Sunset 
Reviews , para. 25). WT/DS269/13 
WT/DS286/15 Page 4 
 
 
consideration necessarily involves an appreciation of the flexibility inherent in the concept of 
"reasonableness", such that the "particular circ umstances of each case" are taken into account.
19   
1. Ruling from the World Customs Organization  
9. The first "particular circumstance" invoked by the European Communities in this arbitration 
is that "the scope [of the relevant WTO provisions in this dispute is] determined by the actions and 
decisions of … the WCO."20  According to the European Communities, WTO Members agreed to use 
the headings and sub-headings of the  Harmonized  Commodity Description and Coding System of the 
WCO (the "Harmonized System") as the basis for ta riff negotiations, and their agreement to do so was 
found by the Appellate Body to c onstitute context for the interpre tation of a Member's schedule, 
pursuant to Article 31(2) of the Vienna Convention on the Law of Treaties  (the " Vienna Convention ").  
As the WCO Secretariat indicated to the Panel in its response to the Panel's questions, any 
interpretation of a WTO Member's tariff schedule would effectively be an interpretation of the 
headings and sub-headings of the  Harmonized Syst em.  However, the scope of the headings and sub-
headings of the  Harmonized System is the subject  of negotiations among the Contracting Parties of 
the WCO, not among the Members of the WTO.  In  the view of the European Communities, this 
competence of the WCO was recognized by th e Appellate Body in its decision in  EC – Computer 
Equipment .21 
10. The European Communities asserts that the Harmonized System Convention  mandates the 
uniform interpretation and application of the head ings and sub-headings of the Harmonized System, 
and to this end includes a procedure providing fo r WCO organs to resolve classification disputes 
between WCO Contracting Parties.  Accordi ng to the European Communities, because WTO 
Members base their schedules on the nomenclature set out by the Harmonized System, and 
Contracting Parties of the WCO have committed to maintaining a uniform interpretation of headings 
in the Harmonized System, implementation in this dispute "requires [the European Communities] to 
ensure that it is acting in conf ormity with its HS obligations."22 
                                                      
19European Communities' submission, para . 22 (quoting Award of the Arbitrator, US – Offset Act (Byrd 
Amendment) , para. 42, itself citing Award of the Arbitrator, US – Hot Rolled Steel , para. 25). 
20European Communities' submission, para. 35. 
21European Communities' submission, para. 46 (citing Appellate Body Report, EC – Computer 
Equipment , paras. 89-90). 
22European Communities' submission, para. 45.  WT/DS269/13 
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Page 5 
 
 
11. The European Communities also ma intains that, in its interpre tation of heading 02.10 of the 
European Communities' Combined Nomenclature—whi ch is based on the identical heading used in 
the Harmonized System—the Appellate Body "did  not fully examine the application of" the 
Harmonized System's General Rules of Interpretation.23  Indeed, the Appellate Body even 
acknowledged that the Harmonized System did not prevent the European Communities from considering preservation as a criterion in determini ng whether a product was "salted".  Moreover, the 
European Communities asserts that "a WCO ruling will give the Commission the possibility to go 
beyond a previous judgment of the ECJ which inte rprets heading 02.10 in a manner different from 
that ultimately followed by the panel and the Appellate Body."
24   
12. Viewed in this light, the European Communities argues, implementation of the DSB's 
recommendations and rulings requires the Europ ean Communities to seek a decision from the WCO 
on the scope of heading 02.10 in order to ascertain precisely what measures must be taken within the 
Community legal order.  Such a first step is not "extraneous" to the objective of implementing the DSB's recommendations and rulings in this dispute
25, but rather, is "fully within the EC’s discretion to 
choose the most appropriate means of implementation."26 
13. On 6 January 2006, the European Communities took the first step to initiate the dispute 
settlement procedure at the WCO, namely, pl acing the matter on the agenda of the March 2006 
meeting of the Harmonized System Committee of the WCO.  Practice suggests that the matter will be 
referred to the scientific sub-committee for further examination.  Because this sub-committee meets 
only in January, the matter cannot be considered  until the sub-committee's next meeting in 
January 2007.  The Harmonized Syst em Committee will therefore be able to take a decision on the 
matter only at its next meeting after January 20 07.  Given that the Harmonized System Committee 
must meet twice a year, and that its last meeting in 2006 will be in October,  the first meeting after 
January 2007 may reasonably be e xpected to be in March 2007.  
                                                      
23European Communities' submission, para. 54. 
24European Communities' submission, para. 44. 
25European Communities' submission, para. 45. 
26European Communities' submission, para. 44. WT/DS269/13 
WT/DS286/15 Page 6 
 
 
2. Steps Under Community Law
 
14. The second "particular circumstance" identified by the European Communities is "that the 
findings of the Appellate Body that there is no requirement of preservation in the [European Communities'] Schedule directly contradict standing case law" of the ECJ.
27 
15. The European Communities recalls that judgments  of the ECJ make clear that heading 02.10 
in the Combined Nomenclature contains a require ment of long-term preservation for products falling 
under that heading.  Implementation of the DSB's recommendations and rulings in this dispute therefore requires that the scope of heading 02.10 be modified under Community law, in particular by amending Additional Note 7 to heading 02.10.   
16. The European Communities contends that, although the Commission "enjoys a wide 
discretion in determining the subject matter of a ta riff heading", such discretion is not unlimited.
28  In 
this respect, the ECJ has ruled that the Commission may not alter the scope of those tariff headings 
that are based on the Harmonized System because the European Communities has undertaken in the 
Harmonized System Convention  not to modify the scope of those headings.  The European 
Communities submits that this constraint is partic ularly relevant here, where the WCO Secretariat 
raised before the Panel its concerns regarding th e interrelationship between the rules of the WCO and 
the WTO in this dispute.  Accordingly, in th e European Communities' view, a ruling from the WCO 
will be necessary for the Commission to secure a Regu lation revising the scope of heading 02.10 in a 
manner contrary to ECJ jurisprudence. 
17. Passing such a Regulation requires that the Commission follow the procedures set out in 
Council Regulation 2658/87 after receiving a decision from the WCO's Harmonized System 
Committee.  The first step is for the responsible Di rectorate General of the Commission to review that 
decision and prepare draft legislation accordingly, a process estimated to take three or four weeks.  
The draft legislation is then sent for discussion to the Agriculture/Chemicals section of the Customs 
Code Committee before being submitted for "forma l interservice consultation" among the relevant 
Commission departments.29  The interservice consultation stage l asts two to three weeks, after which 
the draft legislation is translated into the twenty official Community languages. 
                                                      
27European Communities' submission, para. 61. 
28European Communities' submission, para. 66 (citing French Republic v. Commission , Case C-267/94, 
ECR [1995] I-4845, para. 20 (Exhibit EC-22 submit ted by the European Communities to the Panel)). 
29European Communities' submission, para. 75.  WT/DS269/13 
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18. The Agriculture/Chemicals section of the Cust oms Code Committee then reviews the draft 
legislation and provides an opinion.  Because th at section meets only four times per year, the 
European Communities estimates th at the legislation could not be discussed until a meeting in 
May/June 2007 and an opinion could not be provided until October 2007, both assuming a WCO 
decision in March 2007.  After receiving the opinion, the Commission must vote to adopt the legislation which will likely require an additional two to  three weeks.  In the light of this procedure, 
the European Communities argues, a new Commis sion Regulation amending Additional Note 7 to 
heading 02.10 could not be finalized before November 2007.  Should additional classification 
Regulations be necessary from the Commission, howev er, or revisions to explanatory notes in the 
Combined Nomenclature, these implementation measu res could be adopted within the same time-
frame. 
B. Complaining Parties 
1. Brazil
 
19. Brazil requests that I determine the "reasonable pe riod of time" to be five months and ten days 
from the date of adoption of the Panel and Appe llate Body Reports, to expire on 9 March 2006. 
20. Brazil submits that various provisions of the DS U, including, in particular, Article 21, call for 
"prompt compliance" by the implementing Member.  Pursuant to Article 21.3(c), a Member is entitled 
to a "reasonable" period of time for implemen tation only when immediate implementation is 
"impracticable".  Therefore, according to Braz il, the implementing Member bears the burden of 
demonstrating that it would be impracticable to  comply immediately with the recommendations and 
rulings of the DSB, as well as the burden of de monstrating that the period of time it seeks for 
implementation is "reasonable" within the meaning of  Article 21.3(c).  In Brazil's view, the European 
Communities has failed to meet its burden here. 
21. Brazil notes that the European Communities'  proposed reasonable period of time of 
26 months is intended to allow for multiple actions  to be taken in order to implement the DSB's 
recommendations and rulings.  According to Brazil,  of the proposed actions, only the adoption of a 
Commission Regulation amending Additional Note 7 is required to ensure conformity with the 
European Communities' WTO obligations set out in  the Panel and Appellate Body Reports.  Once 
Additional Note 7 is amended, customs authoriti es will base their classification decisions on that 
amendment and will therefore need no further guida nce in the form of additional regulations or 
explanatory notes.  Therefore, the other actions  proposed by the European Communities—that is, 
requesting a ruling from the WCO, adopting classi fication regulations, and amending Explanatory WT/DS269/13 
WT/DS286/15 Page 8 
 
 
Notes—are "not pertinent or necessary for complian ce" and should not be taken into account in 
determining the reasonable period of time.
30 
22. In addition, Brazil asserts that the Europ ean Communities took no action following adoption 
of the Panel and Appellate Body Reports until it file d a letter with the WCO on 6 January 2006.  This 
failure to act, in Brazil's view, renders the Euro pean Communities "negligent in taking immediate 
steps towards implementation."31  In this respect, Brazil argue s that because the DSU mandates 
prompt compliance, such lack of initiative by an implementing Member "must be adversely taken into 
account" in the determination of the reasonable period of time.32  Brazil finds support for this 
proposition in the Awards of the Arbitrators in  US – Section 110(5) Copyright Act  and  Chile – Price 
Band System .33 
(a) Ruling from the World Customs Organization 
23. Brazil contends that the first phase of the European Communities' proposed implementation, 
seeking a ruling from the WCO over a period of 18 months, is "neither pertinent nor necessary for 
compliance."34  The European Communities' rationale fo r requesting a ruling from the WCO stems 
from its view that any unilateral amendment to the scope of the European Communities' tariff 
headings would effectively modify the headings  and sub-headings of the Harmonized System, 
contrary to the obligations of the  Harmonized System Convention .  As the Panel and the Appellate 
Body recognized, however, the scope of heading 02 .10 of the European Communities' schedule is a 
distinct matter from the interpretation given to heading 02.10 of the Harmonized System.  Although it 
is relevant as context for the interpretation of heading 02.10 of the Europ ean Communities' schedule, 
the Harmonized System does not itself determine th e scope of a concession in a Member's tariff 
heading.   
24. In this respect, Brazil contends that the Europ ean Communities "regularly clarifies or amends 
the [Combined Nomenclature] without modifyin g the [Harmonized System] or consulting the 
WCO."35  Brazil recalls that the initial introduction of preservation as a criterion in the classification 
of the product at issue resulted from appli cation of the Combined Nomenclature and from 
                                                      
30Brazil's submission, para. 16.  (emphasis removed) 
31Brazil's submission, para. 161. 
32Brazil's submission, para. 158. 
33Brazil's submission, paras. 159-160 (citing Award of the Arbitrator, US – Section 110(5) Copyright 
Act, para. 46;  Award of the Arbitrator, Chile – Price Band System , para. 43). 
34Brazil's submission, para. 83. 
35Brazil's submission, para. 110.  WT/DS269/13 
WT/DS286/15 
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Commission Regulation 1871/2003, which replaced A dditional Note 7 to heading 02.10.  This 
amendment did not involve a modification to the Harmonized System and did not compel the 
European Communities to seek authorization from th e WCO.  Similarly, Brazil points to Commission 
Regulations 535/94, 1223/2002, 1871/2003, and 2344/ 2003 as examples of Combined Nomenclature 
classification regulations and amendments that did not modify the Harmonized System and that did not require recourse to the WCO by the European  Communities.  Therefore, Brazil asserts, the 
European Communities is capable of modifying its  Combined Nomenclature without altering the 
Harmonized System and thereby violating the  Harmonized System Convention . 
25. Brazil argues that by seeking a decision from th e WCO, the European Co mmunities is in fact 
"suggesting that the Appellate Body's findings, an d the DSB's recommendations, be subject to the 
approval of the WCO, and that the WCO be the orga nization that ultimately determines whether the 
measures at issue are consistent with" the Europ ean Communities' obligations in its WTO schedule.
36  
Indeed, Brazil questions what the implications woul d be for implementation in this dispute if the 
WCO were to arrive at a decision contrary to the fi ndings of the Panel and A ppellate Body.  Because, 
in Brazil's view, such a decision could not relieve  the European Communities of the obligation to 
implement the DSB's recommendations and rulings in this dispute, recourse to the WCO is 
unwarranted.  Instead, Brazil argues, seeking a rulin g from the WCO is an "extraneous objective" to 
the recommendations and rulings of the DSB in this dispute.37 
(b) Steps Under Community Law 
26. Brazil contests that the European Communiti es requires eight months to pass a Commission 
Regulation implementing the DSB's recommendations and rulings in th is dispute.  According to 
Brazil, the European Communities "agrees that actual compliance in its system can be achieved by a 
simple amendment to the [Combined Nomenclature]."38  Given that the Commission has the power to 
adopt measures amending and clarifying the Combin ed Nomenclature without having recourse to the 
Council, Brazil contends that, contrary to the Eu ropean Communities' assertions, the implementation 
required in this dispute is of an executive or admini strative rather than legislative nature.  Indeed, as 
evidenced by the implementation process put forwar d by the European Communities, any purported 
complexity of implementation is illusory and acco rdingly does not warrant a longer implementation 
period. 
                                                      
36Brazil's submission, para. 88. 
37Brazil's submission, para. 51 (referring to Award of the Arbitrator, EC – Export Subsidies on Sugar , 
para. 69). 
38Brazil's submission, para. 57. WT/DS269/13 
WT/DS286/15 Page 10 
 
 
27. Brazil states that a new Commission Regulation requires that a draft proposal be prepared and 
submitted for interservice consulta tion before being accepted by the Commission and translated into 
the 20 official languages of the European Co mmunities.  Noting the European Communities' 
contention that this stage may take between one month and five days and one month and nineteen 
days, Brazil argues that the shortest period possible for completion of this stage would be one month and five days. 
28. In the next stage of examining a proposal to amend the Combined Nomenclature, according to 
Brazil, the Commission is guided by procedures set out in Council Decision 1999/468/EC, in 
particular, the "management procedure" found in Ar ticle 4 of that Decision.  Pursuant to this 
procedure, the Customs Code Committee must generally provide an opinion on the draft proposal within a time limit established by the Committee Chair.   If that opinion is favourable, the Commission 
may adopt the proposal immediately.  Otherwise, the Commission must communicate the proposal to 
the Council and may defer application of the propo sal for a period no longer than three months.  
Brazil emphasizes that this three-month period is the longest  (rather than shortest ) period possible for 
the conclusion of this stage of the process.  On ce a proposal is adopted and becomes a Commission 
Regulation, it must be published in the  Official Journal .  On the basis of past practice relating to 
Commission Regulations amending the Combined Nomenclature
39, Brazil contends that most 
Regulations are published one day following their a doption and enter into force on the twentieth day 
following publication. 
29. As an example of the time taken for this process, Brazil submits preparatory documents 
relating to Commission Regulation 1871/2003, whic h introduced long-term preservation as a criterion 
in heading 02.10.40  Brazil observes that the time between  the date on which the Customs Code 
Committee received the draft proposal (after interservice consultation) and the date that the Regulation entered into force was two months and tw o days.  Considering the additional time needed 
for the earlier stages of drafting and interservice c onsultation, Brazil contends that five months and 
ten days is a sufficient period to ensure adoption of a Commission Regulation that would comply with 
the DSB's recommendations and rulings in this dispute. 
                                                     
 
39See Exhibit BRA-12 submitted by Brazil in this Arbitration. 
40Exhibit BRA-13 submitted by Brazil in this Arbitration.  WT/DS269/13 
WT/DS286/15 
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(c) Article 21.2 of the DSU 
30. Brazil submits that, in determining the reasona ble period of time, I should bear in mind the 
requirement in Article 21.2 of the DSU to pay "[ p]articular attention ... to  matters affecting the 
interests of developing country Members with respec t to measures which have been subject to dispute 
settlement."  In Brazil's view, this provision applies equally to the interests of developing countries as 
complaining as well as implementing Members. 
31. Brazil highlights the effects that the challenged measures—Commission 
Regulation 1223/2002 and Commission Decision 2003/97/EC—have had on Brazil's interests.  To this end, Brazil refers to lost sales in the Co mmunity market, observing that, based on export growth 
in the three years preceding the adoption of challenged measures, the volume of exports to the 
European Communities was 170,000 metric tons below what could have been expected in the absence 
of those measures, representing a loss of €300 million. 
32. Brazil also submits that the poultry industry is a critical sector in the Brazilian economy, 
responsible for the creation of at least 180,000 jobs.  The poultry industry, in particular several large 
firms, has been important in making investments an d generating jobs in disa dvantaged regions within 
Brazil.  Certain poultry firms have also served their communities by providing social programs to address the needs of the poor.  As a result, Brazil clai ms, this industry has been vital to the trade and 
social development of Brazil, thereby rendering pa rticularly acute the impact of the European 
Communities' WTO-inconsistent measures in this dispute. 
2. Thailand
 
33. Thailand requests that I determine the "reasonabl e period of time" to be six months from the 
date of adoption by the DSB of the Panel and A ppellate Body Reports, th at is, until 27 March 2006. 
34. Thailand observes that the only measures in the terms of reference for this dispute were 
Commission Regulation 1223/2002 and Commission Decision 2003/97/EC.  The European 
Communities, however, identifies in its written subm ission other measures that it claims must be 
brought into conformity during the course of implementation, namely, Additional Note 7 to 
heading 02.10 of the European Commun ities' Combined Nomenclature, the  Dinter  and  Gausepohl  
judgments of the ECJ, as well as certain Expl anatory Notes in Chapter 2 of the Combined 
Nomenclature.  Thailand agrees that "it would provi de a positive solution to this dispute" if the WT/DS269/13 
WT/DS286/15 Page 12 
 
 
European Communities modified these additional measures to reflect the recommendations and 
rulings of the DSB.
41 
(a) Ruling from the World Customs Organization 
35. Thailand submits that the European Communiti es is not required to seek a decision from the 
WCO in order to implement the DSB's recommendations and rulings in this dispute.  Thailand argues 
that the Panel and Appellate Body's interpretati on of heading 02.10 of the European Communities' 
schedule was within their exclusive competence, as the European Communities' schedule is an 
integral part of the GATT 1994, which is a cove red agreement.  The Appellate Body explicitly 
identified the Harmonized System as context under Article 31(2) of the  Vienna Convention .  As such, 
the Harmonized System was only one of several elemen ts used to interpret th e scope of heading 02.10 
of the European Communities' schedule .  Moreover, Thailand asserts that although GATT schedules 
may be based on the Harmonized System, Members are permitted to include descriptions of products falling under specific tariff headings, which may then be used to interpret th e scope of those tariff 
headings.  The findings of the Appellate Body, ther efore, were based on factors particular to the 
European Communities' schedule and did not delineat e the scope of heading 02.10 of the Harmonized 
System itself.  Thailand argues that this fact fu rther highlights the erroneous assumption underlying 
the European Communities' decision to seek a ruling from the WCO, that  is, that the findings of the 
Panel and the Appellate Body  modified  the scope of the headings and sub-headings of the 
Harmonized System. 
36. Thailand adds that nothing in the Harmonized System Convention  requires Contracting Parties 
to obtain authorization from the WCO when dete rmining the terms and conditions of entry for 
particular goods.  Even if the WCO were to determine that the term "salted" in heading 02.10 of the 
Harmonized System refers only to salting for preservation—as the European Communities 
contends—the European Communities would not be precluded from interpreting heading 02.10 of its 
schedule to cover  all  salted products, including those not sa lted for preservation.  Indeed, Thailand 
observes, the European Commun ities did not obtain the WCO's authorization when enacting the 
original Additional Note 7 in 199 4, which made no reference to preservation.  Thailand therefore 
contends that there is no basis to seek a decisi on from the WCO to revert to that wording of 
Additional Note 7 that did properly permit the pr oduct at issue to be entered under heading 02.10 
without the requirement of preservation. 
                                                     
 
41Thailand's submission, para. 12.  WT/DS269/13 
WT/DS286/15 
Page 13 
 
 
37. Thailand also argues that the European Commun ities' proposed recourse to the WCO rests on 
an erroneous understanding that a Member's oblig ations under Articles 17 and 21 of the DSU to 
implement DSB recommendations and rulings promptly, and to accept them unconditionally, may be 
subject to obligations under the Harmonized System Convention .  Thailand contends that to accept the 
European Communities' position that it must first s eek recourse to the WCO in order to implement the 
recommendations and rulings in this dispute would be  to "make a ruling that would call into question 
the rulings of the Panel and the Appellate B ody by subjecting them to a review by another 
international body."42 
38. Thailand further considers misplaced the Eur opean Communities' reliance on the Appellate 
Body's decision in EC – Computer Equipment .  In Thailand's view, the Appellate Body in that case 
addressed the relevance of decisions of the Ha rmonized System Committee in determining the 
existence of "subsequent practice" within the meaning of Article 31.3(b) of the  Vienna Convention .  
No such decisions exist in this dispute and, in  any event, whatever utility the decisions of the 
Harmonized System Committee of the WCO might have in assessing subsequent practice, they do not appear to be relevant now that the adjudica tive phase of the dispute has been completed. 
(b) Steps Under Community Law 
39. Thailand argues that the only time-periods rele vant for the determination of a reasonable 
period of time for implementation of the DSB' s recommendations and rulings are those for the 
issuance of a new Commission Regulation amending Additional Note 7 to heading 02.10 of the 
European Communities' schedule.  On this basis,  Thailand calculates six months as the reasonable 
period of time for implementation in this dispute. 
40. As an initial matter, Thailand emphasizes the fa ilure of the European Communities to begin 
the process of implementation as soon as the Panel a nd Appellate Body Reports in this dispute were 
adopted by the DSB.  Thailand submits that the fi rst step taken by the European Communities towards 
implementation was its letter of 6 January 2006 to the WCO, requesting that this matter be placed on 
the agenda of the next Harmonized System Committ ee meeting.  In Thailand's view, it may not be 
surprising that the European Communities has take n no steps towards implementation, based on its 
view that a decision from the WCO is a prerequisite  to the commencement of the internal Community 
procedures for drafting a new Commission Regulation.  Referring to the Award of the Arbitrator in 
 US – Section 110(5) Copyright Act , Thailand contends that the Eu ropean Communities' inaction to 
date should not justify a longer "reasonabl e period of time" for implementation. 
                                                     
 
42Thailand's submission, para. 36. WT/DS269/13 
WT/DS286/15 Page 14 
 
 
41. With respect to the time-frame set out by th e European Communities for the passage of new 
legislation, Thailand submits that the Europ ean Communities failed to take into account new 
procedural rules, effective 1 January 2006, gove rning consultations between the Commission and the 
Customs Code Committee.  These new procedures, detailed in Commission Decision 2005/960/EC, eliminate one of the steps described by the Europ ean Communities in its written submission, namely, 
the consultation with the Customs Code Committe e before submitting the draft Regulation to the 
"formal interservice consultation". 
42. Thailand recognizes the role of the Agricultu re/Chemicals section of the Customs Code 
Committee in reviewing the draft Regulation.  A ssuming, as the European Communities submits, that 
the Agriculture/Chemicals section meets only four times per year, at intervals of roughly three months, Thailand asserts that the issuance of my Awa rd before the end of February means that an 
opinion could be provided on draft legislation du ring the anticipated March 2006 meeting.  Adding 
two weeks from this meeting for adoption of the le gislation by the Commission, Thailand argues that 
the legislative process could be completed by 27 Marc h 2006, that is, within six months from the date 
of adoption of the Panel and Appellate  Body Reports in this dispute. 
43. Thailand rejects the European Communities' contention that the absence of a ruling from the 
WCO will render implementation more complex.  Th ailand submits, however, that if I accept this 
assertion of the European Communities, then the add itional time granted for such complexity be "no 
longer than two months at the very outset", bringi ng the total proposed time period to eight months.
43 
III. Reasonable Period of Time 
44. This dispute relates to the tariff treatment by  the European Communities of imports of frozen 
boneless chicken cuts impregnated with salt, with a salt content of 1.2 to 3 per cent.  It arises from 
requirements applied to imports of this product by  the European Communities through its Combined 
Nomenclature.  According to these requirements, only products that are sufficiently impregnated with 
salt so as to ensure preservation of meat may be  entered under heading 02.10 of its Combined 
Nomenclature ("meat and edible meat offal, salted, in brine, dried or smoked");  in contrast, fresh, 
chilled, or frozen poultry that do not meet th ese requirements must instead be entered under 
heading 02.07 ("meat and edible offal, of the poultr y of heading No. 0105, fresh, chilled or frozen").   
45. These requirements were applied by virtue  of Commission Regulation 1223/2002 and 
Commission Decision 2003/97/EC, which resulted in a reclassification of the product at issue from 
                                                      
43Thailand's submission, para. 54.  WT/DS269/13 
WT/DS286/15 
Page 15 
 
 
heading 02.10 to heading 02.07 of the Combined Nomenclature.44  If entered under heading 02.07 of 
the Combined Nomenclature, the product at issue would be subject to a bound specific duty rate 
of 1024 ECU/T or 102.4€/100kg/net, as well as a special safeguard mechanism provided for in 
Article 5 of the Agreement on Agriculture .  If entered under heading 02.10, the product at issue would 
be subject to a final bound duty rate of 15.4 per cent.45  The Panel found that, if entered under 
heading 02.07, "there is clearly a possibility that the price of the products at issue [would] be sufficiently low so as to produce an ad valorem  equivalent that exceeds that applicable for products 
covered by the concession contained in heading 02.10 of the [European Communities'] Schedule."
46  
Subsequent to enacting the challenged measur es, the European Communities also enacted 
Commission Regulation 1871/2003, which amended Additional Note 7 to heading 02.10 of the 
Combined Nomenclature so that the term "salted" in heading 02.10 "mean[s] meat and edible meat 
offal deeply and homogeneously impregnated with sa lt in all parts and having a total salt content of 
not less than 1.2% by weight, provided it is the salting wh ich ensures long-term preservation ."47 
46. The Panel found that Commission Regulation 1223/2002 and Commission 
Decision 2003/97/EC are inconsistent with the European Communities' obligations under 
Articles II:1(a) and II:1(b) of the General Agreement on Tariffs and Trade 1994  (the "GATT 1994").48  
On appeal, the Appellate Body reversed certain find ings relating to the Panel's interpretative analysis 
under Articles 31 and 32 of the Vienna Convention on the Law of Treaties  (the " Vienna Convention "), 
but nevertheless upheld the Panel's finding that  Commission Regulation 1223/2002 and Commission 
Decision 2003/97/EC impose duties on the product at issue in excess of those pr ovided for in the tariff 
commitment under heading 02.10 of the European  Communities' schedule.  Accordingly, the 
Appellate Body upheld the Panel's ultimate finding that Commission Regulation 1223/2002 and 
Commission Decision 2003/97/EC are inconsistent with the European Communities' obligations 
under Articles II:1(a) and II:1(b) of the GATT 1994.  On the basis of these findings, the Panel and Appellate Body recommended that the DSB request  the European Communities to bring its two 
measures—Commission Regulation 1223/2002 a nd Commission Decision 2003/97/EC—into 
conformity with its obligations under the GATT 1994.
49 
                                                      
44See Appellate Body Report, paras. 142-143. 
45Panel Reports, paras. 2.4 and 7.70. 
46Panel Reports, para. 7.75. 
47Article 1 of Commission Regulation 1871/2003. (emphasis added) 
48Panel Reports, para. 8.1. 
49Panel Reports, para. 8.2;  Appellate Body Report, para. 348. WT/DS269/13 
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47. On 27 September 2005, the Dispute Settlement Body (the "DSB") of the World Trade 
Organization (the "WTO") adopted the Panel a nd Appellate Body Reports in this dispute.
50  O n  
18 October 2005, the European Communities informed the DSB of its intention to comply with the 
DSB's recommendations and rulings, but stated that it would require a reasonable period of time to do 
so.51  Negotiations among the parties failed to produce a mutually agreed time period, and the parties 
asked me to serve as Arbitrator to determine the "reasonable period of time" to implement the 
recommendations and rulings of the DSB, pursuant to Article 21.3(c) of the Understanding on Rules 
and Procedures Governing the Settlement of Disputes  (the "DSU"). 
48. Article 21.3 of the DSU provides, in part: 
If it is impracticable to co mply immediately with the 
recommendations and rulings [of the DSB], the Member concerned shall have a reasonable period of time in which to do so.  The reasonable period of time shall be: 
*** 
(c) a period of time determined through binding 
arbitration within 90 days af ter the date of adoption of 
the recommendations and rulings.  In such arbitration, a guideline for the arbitrator should be that the 
reasonable period of time to implement panel or 
Appellate Body recommendations should not exceed 15 months from the date of adoption of a panel or Appellate Body report.  However, that time may be shorter or longer, depending upon the particular circumstances.  (footnotes omitted) 
49. My role as arbitrator in this dispute is limit ed.  My sole mandate under Article 21.3 of the 
DSU is to determine the "reasonable period of  time" needed for implementation of the 
recommendations and rulings of the DSB in this dis pute.  Thus, in fulfilling this limited mandate, I 
acknowledge that the implementing Member has a me asure of discretion in selecting the means of 
implementation that it deems most appropriate;  in  other words, with respect to the implementing 
measure, my task focuses on the when , not the what .
52  My concern is with time, not technique.  
Furthermore, I agree with previous arbitrators who have carried out like mandates under Article 21.3 
that I should base my determination on the shortest period of time possible within the legal system of 
                                                      
50WT/DS269/10, WT/DS286/12. 
51WT/DSB/M/199, para. 30. 
52See Award of the Arbitrator,  Canada – Pharmaceutical Patents , paras. 41-43;  Award of the 
Arbitrator,  Chile – Price Band System , para. 32;  Award of the Arbitrator,  EC – Tariff Preferences , para. 30;  
Award of the Arbitrator,  US – Oil Country Tubular Goods Sunset Reviews , para. 26;  Award of the Arbitrator, 
US – Gambling , para. 33;  and Award of the Arbitrator, EC – Export Subsidies on Sugar , para. 69.  WT/DS269/13 
WT/DS286/15 
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the implementing Member53, and that in doing so I should bear in mind that the implementing 
Member is expected to use whatever  flexibility is available within its legal system in its efforts to 
fulfil its WTO obligations.54  Such flexibility, however, need not necessarily include recourse to 
"extraordinary" procedures.55  As is made clear by Article 21.3( c), the "particular circumstances" of 
this dispute may also affect my calculation of th e reasonable period of time, and may make it "shorter 
or longer".  All three parties to this dispute agre e that these general principles should guide me in 
making my determination. 
50. In this dispute, the European Communities proposes a two-step process for implementing the 
recommendations and rulings of the DSB.  To comp ly with those recommendations and rulings, the 
European Communities suggests, first, that it must  seek and receive a tariff classification decision 
from the Harmonized System Committee of the Wo rld Customs Organization (the "WCO"), which 
would require 18 months from the date the DSB adop ted the Panel and Appellate Body Reports in this 
dispute.  According to the European Communities,  a WCO decision is necessary as a prerequisite to 
further implementation internally by the Commission because implementation of the DSB's 
recommendations and rulings will require the Europ ean Commission effectively to reverse certain 
judgments of the European Court of Justice (the  "ECJ").  Therefore, the European Communities 
argues, only after receiving a decision from th e WCO can it proceed to the second step of 
implementation, which would be to adopt a Commi ssion Regulation amending Additional Note 7 to 
heading 02.10 of the European Co mmunities' Combined Nomenclature, specifying that preservation is 
no longer a requirement for produc ts entering under heading 02.10.  The European Communities 
estimates that eight months would be require d to complete this proposed second step of 
implementation.  The European Communities adds that , while this Regulation is  being enacted, other 
Regulations—amending explanatory notes or codifyi ng classification decisions—may also be adopted 
as necessary, depending on the particulars of a WCO decision.  The European Communities thus 
requests that I determine 26 months to be the reasonable period of time for this two-step 
implementation process.  I will consider each of these proposed steps in greater detail below. 
                                                      
53Award of the Arbitrator, Chile – Price Band System , para. 34;  Award of the Arbitrator, Canada – 
Pharmaceutical Patents , para. 47;  Award of the Arbitrator, EC – Tariff Preferences , para. 26;  Award of the 
Arbitrator, US – Oil Country Tubular Goods Sunset Reviews , para. 25;  and Award of the Arbitrator, EC – Export 
Subsidies on Sugar , para. 61. 
54Award of the Arbitrator, Chile – Price Band System , para. 39;  Award of the Arbitrator, EC – Tariff 
Preferences , para. 36;  Award of the Arbitrator,  US – Offset Act (Byrd Amendment ), para. 64. 
55Award of the Arbitrator, Korea – Alcoholic Beverages , para. 42;  Award of the Arbitrator, Chile – 
Price Band System , para. 51;  Award of the Arbitrator, US – Offset Act (Byrd Amendment) , para. 74. WT/DS269/13 
WT/DS286/15 Page 18 
 
 
A. Ruling from the World Customs Organization 
51. With respect to the first step of the European Communities' proposed means of 
implementation, I observe at the outset that the action envisaged—the classification decision of the 
Harmonized System Committee of the WCO—is outside  the lawmaking procedures of the European 
Communities.  In considering this proposed first step, I note, first of all, that disputes that give rise to 
WTO dispute settlement under the DSU focus ex clusively on "measures taken" by a Member
56, and 
that, accordingly, a measure that is the subject of  a challenge in WTO dispute settlement must be 
"attributable" to that Member.57  Because measures so challenged originate in the decision-making 
organs of a WTO Member's own legal system, an  arbitrator under Article 21.3(c) may reasonably 
expect that implementation would ordinarily be achieved by means entirely within the implementing 
Member's lawmaking procedures.  In that ordinary  situation, a Member's prerogative to select the 
means of implementation is particularly strong, and it is appropriate in that situation for an arbitrator 
to refrain from questioning whether another, perhap s shorter, means of implementation is available 
within that legal system. 
52. The situation is not the same, however, where, as here, a Member seeks to implement 
recommendations and rulings of the DSB by decision-making processes outside  its domestic legal 
order.58  Recourse to such external processes will not or dinarily form part of the implementation of 
the recommendations and rulings of the DSB.59  Accordingly, as I see it, the mere assertion by a 
Member of the need for recourse to such exte rnal decision-making processes as part of an 
implementation proposal is not entitled to the same  deference as in the case of an implementation 
procedure that is entirely within that Member's domestic legal system.  Instead, in my view, an 
implementing Member seeking to go outside its domestic decision-making processes bears the burden 
of establishing that this external element of its proposed implementation is necessary for, and 
                                                      
56Article 3.3 of the DSU. 
57Appellate Body Report, US – Gambling , para. 121 (quoting Appellate Body Report, US – Corrosion-
Resistant Steel Sunset Review , para. 81). 
58I recognize that international treaties are binding on the institutions of the European Communities and 
that certain treaties may have direct effect in the Community  legal order.  This does not change the fact that the 
institutions set up by those treaties and decision-making processes followed by these institutions are outside  the 
framework of decision-making within  the European Communities, and are thus not subject solely to the 
decision-making authority of the European Communities. 
59I do not suggest that recourse to processes outside an implementing Member's legal system is never a 
relevant consideration when determining the reasonable period of time, only that such relevance may often not 
be obvious and thus will need to be established by th e implementing Member in order for the arbitrator under 
Article 21.3(c) to take it in to account.  I see no need to state a genera l rule on this issue in making this award, 
and therefore do not do so.  WT/DS269/13 
WT/DS286/15 
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therefore indispensable to, that Member's full and effective compliance with its obligations under the 
covered agreements by implementing the recommendations and rulings of the DSB. 
53. Moreover, I note with some concern that, given the absence of any WCO decision at this time 
that addresses the clarification by the Panel and the Appellate Body of the European Communities' 
WTO tariff schedule, this proposed first step of implementation by the European Communities has the 
potential to create a perceived obstacle to the necessary implementation of the recommendations and rulings of the DSB in this dispute.  As noted above, the DSB adopted the Panel and Appellate Body 
Reports, finding that the two measures at issue are inc onsistent with Articles II:1(a) and II:1(b) of the 
GATT 1994.  It did so on the basis that, by requiring the product at issue to be classified under heading 02.07 of the Combined Nomenclature, th e European Communities has imposed tariffs on the 
product in question in amounts exceeding the amount guaranteed by heading 02.10 of the European 
Communities' WTO schedule of tariff concessions. 
54. I recall that all parties agreed, in the proceedi ngs before the Panel and before the Appellate 
Body, that the tariff treatment under heading 02.07 is  less favourable  than that under heading 02.10, 
and that if the product at issue is covered by h eading 02.10 of the Europ ean Communities' Schedule 
rather than by heading 02.07, th e European Communities would be acting inconsistently with its 
obligations under Article II of the GATT 1994.
60  The Panel and the Appellate Body did find that the 
product at issue is covered by the tari ff commitment contained in heading 02.10.61  At the oral hearing 
in this proceeding, I raised the possibility that a decision by the WCO could call for classification of 
the product at issue in a manner inconsistent w ith the European Communities' obligations under 
Article II of the GATT 1994, as found by the Panel and the Appellate Body in their Reports, and as 
adopted by the DSB.  For example, the WCO might  decide that the product at issue is properly 
classified, according to the Harmonized System, under heading 02.07 rather than heading 02.10.  In 
the light of this possibility, I asked the European  Communities during the oral hearing whether, if 
faced with a WCO ruling that contradicted the WTO ru lings in this dispute, it would continue to take 
those actions necessary to implement the recommendations  and rulings of the DSB in fulfilment of its 
WTO obligations.  In response to my questions, the European Communities declined to commit 
absolutely to implementing the recommendations and ru lings of the DSB irrespective of the content of 
a decision by the WCO.  The European Communities stated instead that such a WCO ruling might 
                                                      
60Appellate Body Report, para. 146 (citing Panel Reports, para. 7.75). 
61Appellate Body Report, para. 347(c)(i);  Panel Reports, para. 8.1(a). WT/DS269/13 
WT/DS286/15 Page 20 
 
 
constitute "subsequent practice" that would change  the state of the law for the purposes of possible 
later review by an Article 21.5 panel.
62 
55. It is axiomatic that alleged violations of  the covered agreements must be redressed 
exclusively through the procedures set out in the DS U, providing for examination of such allegations 
by a panel and possibly the Appellate Body, and that, if violations are found and the relevant reports 
are adopted by the DSB, the respondent Member is obliged to implement promptly the recommendations and rulings of the DSB.  Th ese recommendations and rulings are binding on 
implementing Members, and give rise to an obligatio n to bring their WTO-inc onsistent measures into 
conformity with their obligations under the covere d agreements.  This obligation must be fulfilled 
"prompt[ly] ... in order to ensure effective  resolution of disputes to the benefit of all Members."
63  
Arbitration under Article 21.3(c) furthers this obj ective by establishing a reasonable period of time 
within which such "prompt" compliance must take  place.  The recommendations and rulings of the 
DSB in this dispute will not be implemented by a classification decision by the WCO.  Regardless of the outcome of such a WCO decision, the recomme ndations and rulings of the DSB in this dispute 
will be no closer to being implemented unless— and until—the European Communities takes action 
internally to implement them.  The European Communities states that it will not take any action 
internally until it receives a WCO decision.
64  Thus, conceivably, a finding of the WCO on tariff 
classification in response to a request for such a finding by the European Communities could have the 
effect of prolonging this dispute rather than cont ributing to its resolution through implementation of 
the recommendations and rulings of the DSB.  In  fulfilling my obligations as arbitrator under the 
DSU, I am naturally reluctant to take into account , in my determination of the reasonable period of 
time, the time needed to obtain from another in ternational organization a decision that may not 
contribute to—or may possibly even hinder—the im plementation of the recommendations and rulings 
of the DSB. 
56. Although Members generally have discretion to  determine their means of implementation, 
this discretion is not without bounds.65  Saying that selecting the means of implementing the 
recommendations and rulings of the DSB is the prerog ative of the implementing Member is not at all 
the same as saying that "anything goes".  To d eclare otherwise would be to allow implementing 
Members the discretion also to pursue implementa tion measures that needlessly and unduly extend the 
                                                      
62European Communities' responses to questioning at the oral hearing. 
63Article 21.1 of the DSU. (emphasis added) 
64European Communities' response to questioning at the oral hearing. 
65Previous arbitrators agree.  See Award of the Arbitrator, EC – Hormones , paras. 39-42;  Award of the 
Arbitrator, EC – Tariff Preferences , para. 31;  Award of the Arbitrator, EC – Export Subsidies on Sugar , 
para. 69.  WT/DS269/13 
WT/DS286/15 
Page 21 
 
 
reasonable period of time needed for implementation.  And this would be contrary to the objective of 
Article 21.3 of the DSU.  Therefore, under th ese specific circumstances, I cannot accept recourse to 
the WCO as an element of the European Communitie s' proposed implementation that I must factor 
into my calculation of the reasonable period of time simply because the European Communities has 
proposed it.66  Instead, the European Communities must demonstrate that this first step of 
implementation is a requirement under Community law.   I cannot just take their word for it;  the 
European Communities must establish that it is so. 
57. Toward this end, the European Communities argues that two judgments of the ECJ, the 
Dinter67 case of 1983 and the Gausepohl68 case of 1993, have imposed a requirement that the salting 
of products entered under heading 02.10 of the Comb ined Nomenclature must be such as to ensure 
preservation.  According to the European Communities,  the Panel and Appellate Body Reports in this 
dispute found, contrary to these two rulings of th e ECJ, that preservation is not a requirement of 
eligibility for products falling under heading 02.10 .  The European Communities points out, however, 
that the Commission cannot modify the scope of head ing 02.10 in a manner inconsistent with an ECJ 
ruling—or, more specifically, the Commission ca nnot pass a Regulation amending Additional Note 7 
to heading 02.10—without a classification decision from the WCO. 69  As a result, in the European 
Communities' view, the Commission must receive a classification decision from the WCO as a 
necessary first step toward implementation in this  dispute.  To do otherwise, the European 
Communities insists, would be contrary to its own law.70 
58. It is clear to me from the submission by the European Communiti es that the European 
Communities' position rests on the perception of an  alleged contradiction between the scope of 
heading 02.10 as understood by the ECJ in Dinter  and Gausepohl , and the scope of that heading as 
understood by the Panel and Appellate Body in th is dispute.  As I understand the European 
                                                      
66In this respect, I note my disagreement with the European Communities' contention that a "particular 
circumstance" I should take into account here is the fact  that "the scope [of the relevant WTO provisions in this 
dispute is] determined by the actions and decisions of … the WCO."  (European Communities' submission, 
para. 35)  As the Panel and the Appellate Body made clear in their Reports, the Harmonized System—which is 
negotiated under the auspices of the WCO—does not "determine" the scope of heading 02.10 of the European 
Communities' schedule of concessions, but rather, serves as context  for the interpretation of the schedule.  Both 
the Panel and the Appellate Body made it abundantly cl ear in their Reports that they were interpreting the 
European Communities' Schedule of Concessions, and not the Harmonized System.  (Appellate Body Report, 
para. 199;  Panel Reports, para. 7.189) 
67European Court of Justice, Judgment, Dinter v Hauptzollamt Köln-Deutz , Case C-175/82, 
ECR [1983] 969 (Exhibit-EC-12 submitted by the European Communities to the Panel). 
68European Court of Justice, Judgment, Gausepohl-Fleisch GmbH v. Oberfinanzdirektion Hamburg , 
Case C-33/92, ECR [1993] I-3047 (Exhibit EC-14 submitted by the European Communities to the Panel). 
69European Communities' responses to questioning at the oral hearing. 
70Ibid. WT/DS269/13 
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Communities' oral submissions, in the absence of such a contradiction, the European Commission 
could proceed to adopt a Regulation amending Add itional Note 7 to heading 02.10 even without a 
WCO decision.
71 
59. In my limited role as arbitrator, I am bound not only by Article 21.3 of the DSU.  I am bound 
also by the factual findings and the legal judgments that form the basis of the Panel and the Appellate 
Body Reports that have been adopted as recommendations and rulings by the DSB.  So too are the parties to the dispute.  To those I turn to as sess this proposal by the European Communities as it 
relates to these two ECJ cases.   
60. The Panel and the Appellate Body examined  these two ECJ judgments in the course of 
interpreting heading 02.10 of the European Communiti es' schedule, and I consider their observations 
on those judgments especially relevant to my cons ideration of the European Communities' proposed 
implementation process here.  The Panel stated that the ECJ, in Dinter , had analyzed heading 16.02 of 
the Combined Nomenclature, dealing with "seasoned meat", and that the "general comments" made 
by the ECJ with respect to Chapter 2 of the Combin ed Nomenclature were not relevant to the Panel's 
interpretation of heading 02.10 of the European Communities' schedule.
72  As a result, the Panel 
"[did] not consider the Dinter  judgment" further in its interpretative analysis.73  Although the ECJ, in 
Gausepohl , addressed heading 02.10, the Panel found " certain ambiguities concerning the meaning 
and effect of the Gausepohl  judgment that are important fo r the purposes of the present case."74  The 
Panel pointed, inter alia , to two aspects of the Gausepohl  judgment:  (1) the judgment focused on 
bovine meat, thereby leaving its applicability to othe r meats (including poultry) uncertain;  and (2) the 
judgment is unclear as to whether the 1.2 per cent salt content required for preservation "is a 
minimum salt content below which meat can be assumed not to be salted for the purposes of 
heading 02.10 or, rather, is a minimum salt conten t above which meat will be salted for the purposes 
of heading 02.10."75  Finally, the Panel found evidence of these ambiguities in the minutes of a 
meeting of the European Communities' Customs Code Committee.76 
                                                      
71This is consistent with the Commission's general practice of passing Regulations relating to 
classification or scope of the Combined Nomenclature, for which the Commission has historically not been 
required to consult the WCO.  (Brazil's submission, paras. 109-111;  European Communities' responses to 
questioning at the oral hearing) 
72Panel Reports, para. 7.393. 
73Panel Reports, para. 7.393. 
74Panel Reports, para. 7.398. 
75Panel Reports, para. 7.398. 
76Panel Reports, para. 7.401.  WT/DS269/13 
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61. For its part, the Appellate Body did not examine the substance of Dinter , stating that the date 
of that judgment (1983) "diminishe[d] its releva nce" for understanding the scope of heading 02.10.77  
With respect to Gausepohl , the Appellate Body stated: 
[I]t is not clear whether the ECJ's Gausepohl judgment requires that, 
for purposes of heading 02.10, salting must ensure preservation … . 
[W]e are not persuaded that Gausepohl must be understood in the 
sense that the 1.2 per cent salt content is merely a minimum above which it is necessary to show—i n addition—that salting ensures 
long-term preservation.
78  (footnote omitted) 
62. Thus, neither the Panel nor the Appellate Bo dy made definitive findings as to whether Dinter  
and/or Gausepohl  require products entered unde r heading 02.10 to contain sufficient salt to preserve 
the meat being imported.  But, to the extent that  the Panel and the Appellate Body examined these 
judgments, it seems to me that they expressed consid erable scepticism about such a reading of these 
judgments.  And they did so despite the fact that  the same arguments made here by the European 
Communities about these two ECJ judgments were made also by the European Communities during 
the proceedings before the Panel and the Appellate Body.  In the light of such scepticism, and given 
that no definitive finding has been made by the Pane l or the Appellate Body with respect to the scope 
of the Dinter  and Gausepohl  judgments, the European Communities, despite its considerable efforts in 
this proceeding, has not shown to my satisfaction th at these judgments stand for what it claims, much 
less has it established any reason why I should accept a reading of these judgments that is markedly 
different from the reading suggested by the Panel and the Appellate Body.79  Where the Panel and the 
Appellate Body have expressed one view on issues rela ting to the substance of this dispute, I am not 
free, in fulfilling my limited mandate as arbitrator, to  express another.  I am certainly not free in this 
limited role to contradict the reasoning of th e Panel and Appellate Body that led to the 
recommendations and rulings that have been adopted by the DSB.  The purpose of an Article 21.3 arbitration is not to question the recommendations and rulings of the DSB;  it is to establish the 
                                                     
 
77Appellate Body Report, para. 327. 
78Appellate Body Report, paras. 335-336. 
79I note in this regard that a previous arbitrator has similarly expressed reservations about basing 
findings on unsettled or unclear issues of municipal law where neither a panel nor the Appellate Body itself 
arrived at a view on those issues: 
In asking me to draw this distinction, ... Antigua is effectively asking me to 
make a ruling concerning the meaning and scope of application of United 
States municipal law.  I do not consider that it forms part of my mandate to do so, given that the findings of the Panel and the Appellate Body make no 
such distinction. 
(Award of the Arbitrator, US – Gambling , para. 40) WT/DS269/13 
WT/DS286/15 Page 24 
 
 
reasonable period of time a Member should have to implement them.  The aim of implementation is 
implementation.  Nothing less.  And nothing more. 
63. Because the European Communities has failed to establish its proffered interpretation 
of  the  Dinter  and Gausepohl  judgments
80, I see no basis to conclude that implementing the 
recommendations and rulings of the DSB in this dispute through a Commission Regulation amending 
Additional Note 7 to heading 02.10 would be incons istent with those judgments.  This "particular 
circumstance" advanced by the Eur opean Communities is the sole basis on which it attempts to justify 
the asserted need to have recourse to a classificati on decision from the WCO.  Having found that this 
"particular circumstance" does not exist, a nd bearing in mind the concerns expressed above81, I find 
no reason to account for the allowance of time fo r a WCO decision in my determination of the 
reasonable period of time in this dispute.   
64. The European Communities is free, of course, to seek a decision from the WCO;  after all, it 
is for the European Communities, as the implementi ng Member, to determine in the first instance 
what it needs to do as a consequence of the recommenda tions and rulings of the DSB in this dispute.  
It is for me, however, to fulfil my task under Artic le 21.3(c) of the DSU in determining the reasonable 
period of time that the European Communities will  need to implement those recommendations and 
rulings;  and I am not persuaded that the time it would take to obtain a decision from the WCO is 
needed to accomplish the task of implementation.    
B. Steps Under Community Law 
65. Having found that a WCO decision does not form an  appropriate part of my determination of 
the reasonable period of time, I go on now to exam ine the second stage of implementation proposed 
by the European Commun ities, relating to the actions requi red for the proposed passage of a 
Commission Regulation amending Additional Note 7 to heading 02.10 of the Combined 
Nomenclature.  I begin by considering certain points raised by Brazil and Thailand with respect to the 
overall process before turning to a closer examinati on of the steps involved in passage of the proposed 
Commission Regulation under Community law. 
                                                      
80Although arbitrators under Article 21.3(c) are not called upon in the normal course of their duties to 
pronounce on the meaning of municipal law, I am of the view, expressed above, that I am not permitted in the circumstances of this case simply to accept the European Communities' understanding of the relevant ECJ cases.  
This is so because this understanding is argued by the European Communities in an attempt to discharge its 
burden of persuading me that action outside the domestic decision-making process of the European Communities is necessary for implementation of the recomme ndations and rulings of the DSB in this dispute.  
(Supra , para. 56) 
81Supra , paras. 51-55.  WT/DS269/13 
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66. First, Brazil and Thailand emphasize that since the adoption of the Panel and Appellate Body 
Reports in this dispute on 27 September 2005, the European Communities has fa iled to take sufficient 
steps towards implementation.  Citing previous arbitr ation awards, they contend that this inaction on 
the part of the European Communities should be refl ected in a reduction of the period of time that I 
consider to be reasonable under Article 21.3(c) of the DSU.82  The European Communities 
acknowledged during the oral hearing that, four mo nths after the adoption of the recommendations 
and rulings of the DSB, it had not yet taken any co ncrete steps toward implementation by formulation 
of the proposed Regulation.83  Based on the European Communities' submission, all that seems to 
have occurred thus far is internal discussions with in the European Communities.  Mere discussion is 
not implementation.  There must be something more to evidence that a Member is moving toward implementation.  I therefore agree with Braz il and Thailand that this failure to commence 
implementation of the DSB's recommendations and ruli ngs is a factor that I should take into account 
in determining the reasonable period of time for implementation. 
67. Second, Brazil characterizes the implementa tion process proposed under Community law as 
executive or administrative, and not as a legislative action.
84  The European Communities, however, 
asserts that the powers to be exerci sed by the Commission in this case are legislative  powers 
delegated to the Commission by the Council.85  I recognize that the Commission engages in a "law-
making" function, and thereby acts in a manner similar to legislatures when enacting a Regulation amending Additional Note 7.  In my view, however, this, alone, does not render the process legislative  
such that additional time may be required for implemen tation.  Previous arbitrations have highlighted 
that implementation achieved through administrativ e processes generally requires less time than 
implementing legislation.
86  This distinction is premised on the fact that administrative action 
generally may be accomplished solely by one in stitution (often the Ex ecutive Branch) of the 
implementing Member, whereas legislative action gene rally requires the partic ipation of additional 
                                                      
82Brazil's submission, paras. 157-163 (citing Award of the Arbitrator, US – Section 110(5) Copyright 
Act, para. 46, and Award of the Arbitrator, Chile – Price Band System , para. 43);  Thailand's submission, 
paras. 40-42 (citing Award of the Arbitrator, US – Section 110(5) Copyright Act , para. 46). 
83European Communities' response to questioning at the oral hearing.  On 6 January 2006—more than 
three months after the adoption of the recommendations and rulings of the DSB—the European Communities did submit a letter to the WCO requesting that the classi fication of the product at i ssue be placed on the agenda 
of the March 2006 meeting of the Harmonized System Committee.  As I noted above, however, I do not 
consider relevant for my determination of the reasonable period of time any actions relating to the European 
Communities' request for a ruling from the WCO.  ( Supra , para. 63) 
84Brazil's submission, para. 58. 
85European Communities' responses to questioning at the oral hearing. 
86See, for example, Award of the Arbitrator,  Canada – Pharmaceutical Patents , para. 49;  Award of the 
Arbitrator, US – Section 110(5) Copyright Act , para. 34;  Award of the Arbitrator, Australia – Salmon , para. 38;  
Award of the Arbitrator, Canada – Patent Term , para. 41;  Award of the Arbitrator, Chile – Price Band System , 
para. 38. WT/DS269/13 
WT/DS286/15 Page 26 
 
 
institutions (typically at least the Legislative Br anch—likely to have slower, more deliberative 
processes—possibly in conjunction with  the Executive Branch as well).
87  The implementation steps 
proposed by the European Comm unities under Community law are expected to be accomplished 
exclusively by the Commission, w ithout involvement by the Council or the European Parliament.  I 
therefore do not consider these steps to be "legislativ e" in the sense in which I believe that term has 
come to be understood in the context of arbitrati ons under Article 21.3(c).  Accordingly, I must take 
into account in my determination the administrative  nature of the proposed implementation process.  
68. All this settled, in determining the reasona ble period of time the European Communities 
ought to have to fulfil its WTO obligations, I come now to the need to undertake detailed 
consideration of the steps required under Comm unity law for passing a Commission Regulation to 
implement the recommendations and rulings of the DSB in this dispute.  As discussed above, the 
European Communities submits that eight months is required to pass such a Regulation.  Setting aside 
the specific circumstances of this case—in particul ar, the alleged need for the European Communities 
to secure a WCO decision before initiating Co mmission action—the European Communities notes 
that, in general, Regulations relating to the Comb ined Nomenclature must follow a "more complex" 
adoption procedure and will therefore warrant more than the eight months proposed by the European 
Communities.88  In this regard, the European Communiti es points in particular to one additional 
consultation the Commission would have to have with the Customs Code Committee when drafting a 
Regulation in the absence of a WCO decision.89  According to the European Communities, the 
minimum time required for enacting a Commi ssion Regulation relating to the Combined 
Nomenclature, but not based on a WCO decision, is  185 working days.  Assuming five working days 
per week, by my calculation, this is the equivale nt of 259 calendar days, which is roughly between 
eight and nine months. 
69. The parties agree that the first step in passing the Commission Regulation involves 
preparatory work within the Commission, includ ing research, departmental analysis within the 
responsible Directorate-General, and translation of documents into the working languages of the 
                                                      
87See, for example, Award of the Arbitrator, Chile – Price Band System , para. 38: 
I agree with the observation of previo us arbitrators that implementation 
through legislation is likely to require a longer time for implementation than administrative rulemaking or other exclusively Executive action .  (emphasis 
added)  (footnote omitted) 
88European Communities' submission, para. 77. 
89European Communities' responses to questioning at the oral hearing.  The European Communities 
maintains that, in any event, the Commission is without authority to enact a Regulation in this case without a 
WCO ruling and that, therefore, any consideration of time -frames for enacting such a Regulation is hypothetical.  
Nevertheless, the European Communities provided me with the process and likely time-frame, in its view, for 
enacting a standard Regulation relating to the Combined Nomenclature.  WT/DS269/13 
WT/DS286/15 
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Commission (English, French, and German).  The European Communities submits that, although this 
step requires no minimum time period by law, a reas onable period of 15 working days is required for 
such groundwork.90  Brazil and Thailand argue that, in the absence of specified time periods, the 
Commission must employ the flexibility in its system  to complete its preparatory work as quickly as 
possible.91 
70. The next step involves the first consultation w ith the Customs Code Co mmittee to assist in 
identifying more precisely what course of action mi ght be pursued to achieve the relevant objective—
specifically, whether to adopt a classification regulati on, explanatory note, or additional note.  This 
consultation is not mandated by law, although the Rules of Procedure of the Customs Code 
Committee and Council Regulation 2658/87 appear to allow for such informal discussions.92  T h e  
European Communities contends that, based on the re quirement for the distribution of the agenda at 
least 14 calendar  days in advance of the meeting93, this step will take 10 working days to complete.  
The European Communities argues that 10 worki ng days will similarly be required for the second  
consultation with the Customs Code Committee, whic h is also not legally mandated, but during which 
the Committee provides its first views on the draft Regulation.94  Both of these consultations with the 
Customs Code Committee, according to the European Communities, re flect "standard practice", and 
are evidenced in the preparatory work of Commission Regulation 1871/2003, which initially 
introduced the long-term preservation criterion in Additional Note 7 to heading 02.10 of the 
Combined Nomenclature.95 
71. Thailand submits that the requirement of 14 calendar days cited by the European 
Communities for the distribution of the agenda of  the Customs Code Committee applies only when 
the Commission requests an opinion  from the Committee, rather than when the Commission consults  
the Committee on a new Regulation.96  Thailand further contends that new rules of procedure went 
                                                      
90European Communities' responses to questioning at the oral hearing. 
91Brazil and Thailand's responses to qu estioning at the oral hearing. 
92Rules of Procedure of the Customs Code Committee, Art. 3.2(c) (Exhibit THA-4 submitted by 
Thailand in this Arbitration);  Council Regulation 26 58/87, Art. 8 (Exhibit BRA-6 submitted by Brazil in this 
Arbitration). 
93Rules of Procedure of the Customs Code Committee, Art. 4.1 (Exhibit THA-4 submitted by Thailand 
in this Arbitration). 
94European Communities' responses to questioning at the oral hearing. 
95European Communities' responses to questioning at the oral hearing;  Exhibit EC-4 submitted by the 
European Communities in this Arbitration. 
96Thailand's response to questioning at the oral hearing (citing Article 8 of Council Regulation 2658/87 
(Exhibit BRA-6 submitted by Braz il in this Arbitration)). WT/DS269/13 
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into effect for the Comm ission on 1 January 2006
97, and that, under these procedures, the Commission 
is expected to consult with the Customs Code Committee only once, before the drafting of the new 
Regulation.  According to Thailand, there is th erefore no need to account for the second consultation 
with the Customs Code Committee after  the Regulation has been drafte d and before the interservice 
consultation.98  The European Communities disagrees with Thailand, explaining that the 
Commission's consultation with the relevant mana gement committee when adopting a new Regulation 
is not governed by the Commission's rules of pro cedure, but rather, by Council Regulation 2658/87.  
This Council Regulation, according to the Eu ropean Communities, plainly allows for the 
aforementioned informal consultations with the Co mmittee, and cannot be modified by a Commission 
Decision on its internal rules of procedure.99 
72. Between the two consultati ons with the Customs Code Committee, the European 
Communities claims, the Commission will need 35 working days for further analysis and for 
composing the draft Regulation (in the light of the first consultation with the Customs Code Committee), followed by 15 working days for transl ation of the draft Regulation into the three 
working languages of the Commission.  The Eur opean Communities acknowledges that these actions 
are not required by Regulation, but the Europ ean Communities asserts that  they are an essential 
component of the process of enacting a new Regulation.
100  Brazil and Thailand observe that the time 
period for drafting of the Regulation is not stipulated  by law, and that, given the relative simplicity of 
what is required to remove the effects of the WTO- inconsistent measures in this case, 35 days is not 
required for preparing the draft Regulation.101 
73. After the second consultation with the Customs Code Committee, according to the European 
Communities, the draft Regulation will need to be revised before being sent to other departments 
within the Commission for additional consultati on and consequent modifications, followed by 
translation into all the official languages of the European Communities.  Furthermore, the European 
                                                      
97The new procedures relied upon by Thailand are found in Commission Decision 2005/960/EC 
(Exhibit THA-1 submitted by Thailand in this Arbitration). 
98Thailand's submission, para. 47 (citing Article 23.3 of Commission Decision 2005/960/EC);   
Thailand's response to questioning at the oral hearing.  Article 23.3 of Commission Decision 2005/960/EC 
provides: 
Before a document is submitted to the Commission, the department 
responsible shall, in acco rdance with the implemen ting rules, consult the 
departments with a legitimate interest in the draft text in sufficient time. 
(Exhibit THA-2 submitted by Thailand in this Arbitration) 
99European Communities' response to questioning at the oral hearing. 
100European Communities' responses to questioning at the oral hearing. 
101Brazil's and Thailand's responses to questioning at the oral hearing.  WT/DS269/13 
WT/DS286/15 
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Communities states, pursuant to the Commission's Manual of Operating Procedures, other 
departments must be provided at least 10 worki ng days for interservice consultation on the draft 
Regulation.102  The European Communities suggests that, to this minimum of 10 working days for 
interservice consultation, 10 working days must be added for revisions based on the second round of 
consultation with the Customs Code Committee, and 30 days must be added to cover translation and 
modifications to the draft regulation based on th e results of the interservice consultation.   
74. Brazil contends that the European Commun ities overstates the need for interservice 
consultations, particularly with respect to th e Commission's Legal Service, because the Manual of 
Operating Procedures explicitly notes that the opinion of the Legal Service is not required where, as 
here, the Commission is exercising its delegated  powers.103  In response, the European Communities 
submits that Brazil misunderstands this statement in the Manual because the Legal Service's opinion 
is not required only where powers are delegated within  the Commission, not where implementing 
powers are delegated from the Council, as is the case here.104 
75. The next step in the process provides for th e Agriculture/Chemical section of the Customs 
Code Committee to deliver a formal opinion on the draft Regulation, pursuant to Articles 9 and 10 of 
Council Regulation 2658/87.105  The European Communities asserts  that the Agriculture/Chemical 
section "meets only 4 times a year, at intervals of rou ghly three months (i.e. in  March, late May/June, 
October and December)."106  Furthermore, as with the two c onsultations with the Customs Code 
Committee, the Rules of Procedure require that the ag enda and draft Regulation be distributed at least 
14 calendar days before the meeting.107  The European Communities asks me to take into account 10 
working days to receive the opinion of the Customs Code Committee.108   
76. Thailand argues that the Committee's Rules of Pr ocedure provide the Chair with the right to 
convene a Customs Code Committee meeting whenev er the Chair deems appropriate, and thus, an 
opinion could be provided even if a meeting of the Agriculture/Chemical section were not scheduled 
                                                      
102Exhibit EC-6 submitted by the European Communities in this Arbitration. 
103Letter from Brazil to the Arbitrator, dated 31 January 2006, p. 2 (quoting Commission's Manual of 
Operating Procedures (Exhibit EC-6 submitted by th e European Communities in this Arbitration)). 
104Letter from the European Communities to the Arbitrator, dated 1 February 2006, p. 1. 
105European Communities' submission, para. 76;  European Communities' response to questioning at 
the oral hearing. 
106European Communities' submission, para. 76. 
107Rules of Procedure of the Customs Code Committee,  Art. 4.1 (Exhibit THA-4 submitted by Thailand 
in this Arbitration). 
108European Communities' responses to questioning at the oral hearing. WT/DS269/13 
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for another three months.
109  In any event, according to Thailand,  given that this Award is to be 
released on 20 February 2006, the Agriculture /Chemical section meeting in March 2006 could 
provide an opinion on the Commission's draft Regulation at that meeting.110 
77. The final step of the process before publicati on is what the European Communities refers to 
as the "habilitation procedure", which I understand to  be a procedure whereby the Commission, as a 
collective body, may delegate certain tasks (includi ng adoption of the final Regulation) to one of the 
Commission Members, which may also be sub-delegated to lower officials within the Commission.111  
Although no legal time-frames are provided for the habilitation procedure, the European Communities 
submits that, based on past practice, this step will require 10 working days.  Brazil and Thailand 
suggest that, where there is no minimum time period prescribed by law, as in the case of the habilitation procedure, the amount of time propo sed by the European Co mmunities is excessive.
112 
78. Lastly, the European Communities considers that publication of the Regulation in the Official 
Journal  and the entry into force of the Regulation will require an additional 30 working days113, based 
in part on the legal requirement that, absent specifi cation in the Regulation, it will enter into force on 
the twentieth calendar day following its publication.114  Brazil rejects the need for 30 days for this 
phase of the process.  On the basis of its review of fifty Commission Regulations relating to 
classification or amending the Combined Nomenclatu re, Brazil contends that "nearly all Commission 
Regulations" are published one day following adopti on and enter into force on the twentieth day 
thereafter, resulting in a total of 21 days rather than 30.115 
                                                      
109Thailand's submission, para. 51 (citing Customs Code Committee's Rules of Procedure, 
TAXUD/741/2001 (Exhibit THA-4 submitted by  Thailand in this Arbitration)). 
110Thailand's submission, para. 52. 
111European Communities' response to questioning at the oral hearing.  The European Communities 
contends that the "habilitation procedure" is reflected in  Article 13 of the Commission's Rules of Procedure, 
titled "Decisions taken by empowerment procedure".  (European Communities' response to questioning at the 
oral hearing, citing Commission Decision 2005/960/EC (Exhibit THA-2 submitted by Thailand in this Arbitration)) 
112Brazil's and Thailand's responses to questioning at the oral hearing. 
113European Communities' response to questioning at the oral hearing. 
114Article 254(2) of the Treaty Establishing the European Community provides: 
Regulations of the Council and of the Commission, as well as directives of 
those institutions which are addressed to all Member States, shall be 
published in the Official Journal of the European Union. They shall enter 
into force on the date specified in th em or, in the absenc e thereof, on the 
20th day following that of their publication. 
115Brazil's submission, para. 73 (citing its analysis of fifty Commission Regulations, contained in 
Exhibit BRA-12 submitted by Brazil in this Arbitration).  WT/DS269/13 
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79. Certain observations may be made with respect to these Community procedures.  First, not all 
of the actions identified by the European Co mmunities are required under Community law when 
passing a Commission Regulation.  In some instances,  this may suggest that those actions not required 
by law are to be given less weight in my determination of the reasonable period of time.116  In other 
instances, however, the fact that a certain action is  not mandated does not mean that such action is 
irrelevant to my determination.117  In this respect, I note, in pa rticular, that certain procedures and 
time-frames, while not mandated, are based on st andard practice as the European Communities has 
substantiated with relevant evidence.118  While WTO Members will, unquestionably, always want to 
ensure that they are complying fully with all of  their WTO obligations by implementing adverse WTO 
rulings as quickly as possible in their own legal system s, ordinarily their standard practices in those 
systems should suffice. 
80. Second, certain of the time periods mentioned above are estimates provided by the European 
Communities, but are not minimum periods required by law.  I agree with previous arbitrators that, in such situations, the implementing Member should be expected to use the flexibility reasonably 
available within its system to ensure pr ompt compliance with its WTO obligations.
119  Third, where 
time periods are asserted for a particular proposed step, but are not supported by evidence, I have 
considered the views put forward by the parties, and have arrived at an understanding of what could 
be considered a reasonable amount of time for the completion of that step.  More specifically, in certain instances, I have accepted the time claimed to be necessary by the Eu ropean Communities, but 
have discounted that time for steps that, in my view , could reasonably be completed sooner, bearing in 
mind that implementation should occur in the shortest period of time possible within the legal system 
of the implementing Member.  These overall considera tions guide my determin ation of the reasonable 
period of time. 
                                                     
 
116Award of the Arbitrator, Canada – Pharmaceutical Patents , para. 51. 
117See Award of the Arbitrator, Chile – Price Band System , para. 42: 
The absence of a requirement under Chile's laws to engage in pre-legislative 
consultations is not sufficient, in my view, to dismiss the relevance of such 
consultations for purposes of this Artic le 21.3(c) arbitration.  …  Although 
not mandated by law, consultations within government agencies as well as 
with the affected sectors of soci ety are typically a concomitant of 
lawmaking in contemporary polities, and such consultations should be taken into account when fixing a "reasonable period of time" for implementation.  
(footnote omitted) 
118Award of the Arbitrator, Canada – Pharmaceutical Patents , para. 54;  Award of the Arbitrator, EC – 
Tariff Preferences , para. 42. 
119Award of the Arbitrator, Canada – Patent Term , paras. 63 and 64;  Award of the Arbitrator, EC – 
Export Subsidies on Sugar , para. 77;  Award of the Arbitrator, EC – Tariff Preferences , para. 36. WT/DS269/13 
WT/DS286/15 Page 32 
 
 
C. Article 21.2 of the DSU 
81. I turn briefly now to Brazil's request that, in determining the reasonable period of time, I pay 
"particular attention" to its interests as a devel oping country Member, pursuant to Article 21.2 of the 
DSU.
120  In support of this request, Brazil submits evidence relating to market share, revenue, 
employment dependent on this industry, and the ro le of this industry in promoting social programs 
within Brazil, arguing that adverse impacts on these factors warrant particular attention.121 
82. Article 21.2 of the DSU states: 
Particular attention should be paid to matters affecting the interests of 
developing country Members with respect to measures which have 
been subject to dispute settlement. 
Brazil has shown to my satisfaction that Brazil's inte rests are indeed affected by the measures of the 
European Communities that are the subject of this dispute.  Furthermore, Brazil is correct that 
Article 21.2, on its face, makes no distinction in cases where developing country Members are 
complaining rather than implementing Members in a particular dispute.122  However, as I have already 
observed, my determination of the reasonable pe riod of time results from my understanding of the 
shortest period of time possible  in the Community legal order for implementing the proposed 
Commission Regulation amending Additional Note 7 to heading 02.10.123  Having arrived at the 
shortest period of time possible, I consider that the reasonable period of time for implementation is 
not additionally affected by the fact that Brazil, as a complaining Member in this dispute, is a 
developing country.124 
                                                      
120Brazil's submission, paras. 164-173.  Thailand did not request that particular attention be paid to its 
interests, even though it also is a developing country Member.  (Thailand's response to questioning at the oral 
hearing)  Accordingly, it advanced no argument, and provided no supporting evidence, in relation to the instruction contained in Article 21.2 of the DSU. 
121See supra , paras. 31-32. 
122Award of the Arbitrator, US – Gambling , para. 59;  Award of the Arbitrator, EC – Export Subsidies 
on Sugar , para. 99. 
123Supra , paras. 49 and 80. 
124See Award of the Arbitrator, US – Oil Country Tubular Goods Sunset Reviews , para. 52.  WT/DS269/13 
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IV. The Award 
83. As a final point, I recall that the European Communities requests eight months  for enacting a 
Commission Regulation following a WCO decision, arguing that "[w]ithout a WCO determination 
any internal Community procedure will  inevitably become more complex."125  Having concluded that 
the European Communities failed to establish the need for recourse to the WCO, I have nevertheless 
taken this request for eight months by the Europ ean Communities into account in my award, along 
with the other considerations I have already discussed. 
84. In the light of the considerations outlined a bove, I determine that the "reasonable period of 
time" for the European Communities to implement the recommendations and rulings of the DSB in 
this dispute is nine months from 27 September 200 5, which was the date on which the DSB adopted 
the Panel and Appellate Body Reports.  The reas onable period of time will therefore expire on 
27 June 2006. 
 
 Signed in the original at Washington, DC this 14th day of February 2006 by: 
 
   
 
________________________ 
James Bacchus 
Arbitrator 
 
                                                     
 
125European Communities' submission, para. 77.