RESTRICTED  WORLD TRADE  
ORGANIZATION  TN/DS/M/32 
29 June 2006 
 (06-3141) 
Special Session of the Dispute Settlement Body 
24 -25 April 2006  
 
 
 
MINUTES OF MEETING 
 
Held in the Centre William Rappard  
on 24-25 April 2006  
 
Chairman: Mr. Ronald Saborío Soto (Costa Rica) 
  
The Chairman
 welcomed delegations to the thirty-f ifth meeting of the Special Session and 
said that the airgram for the meeting had been circ ulated in WTO/AIR/2802 and that the draft agenda 
(TN/DS/W/85) contained two items, namely:  (i) discussion of contributions by delegations;  and 
(ii) "Other Business".  With respect to the first ag enda item, he said that four new proposals had been 
received since the previous meeting of the Special Se ssion.  The first was an informal contribution by 
Hong Kong, China, which had been circulated as Job(06)/89.  The second was a joint contribution 
from Japan and the European Communities, circul ated as Job(05)/47/Add.1.  The third was a 
contribution from the United States, circulated as TN/DS/W/86, while the fourth was a joint informal 
contribution by Argentina, Brazil, Canada, India, New Zealand and Norway (G-6).  This document 
was currently available in the room and would be ci rculated later as a Job document.  He said that it 
was his intention to invite the proponents to pr esent their proposals and then open the floor for 
comments from Members.  He furthe r said that it was not his intention to raise any item under "Other 
Business" and asked whether any delegation wished to do so.  As there was no request from the floor, 
he proposed the deletion of this item from the age nda.  The agenda of the meeting was then adopted 
as amended. 
1. Discussion of Contributions from Members 
1. Prior to giving the floor to Hong Kong, China, the Chairman  stated that it was his 
understanding that the proposal advocated an alte rnative approach for addressing the conditions under 
which non-disputing Members should be allowed to par ticipate in consultations as third parties.  It 
had been crafted taking into account earlier proposal s and the views expressed by Members.  He 
invited Hong Kong, China to present its proposal.   
2. The representative of Hong Kong, China  said that Hong Kong, China had raised this idea in 
the past during discussions in the Special Session and also during informal consultations, especially in 
meetings of the Mexican Group and had benefite d from the comments of Members on earlier draft 
texts.  The proposal focussed on one particular element of the third party rights, which was the 
acceptance or rejection of requests to join in consulta tions by third-country Members.  It advocated an 
alternative approach to the all or nothing appro ach proposed by the Group of Seven Countries (G-7).  
Essentially, Hong Kong, China shared the concerns of the G-7 that Article 4.11 of the DSU practically 
gave the responding Member a free hand in deci ding whether to reject or accept requests by 
third-country Members to join in consultations .  This could result in discrimination among 
third-country Members.  However, the all or nothin g approach bundled all requests to be joined in 
consultations and required the acceptanc e or rejection of all requests.  Such an approach was too rigid 
and failed to take into account the differences among the requesting countries.  Furthermore, it could TN/DS/M/32 
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  also lead to a practice where the responding Member  might be tempted to routinely reject all the 
requests, especially where they considered that one particular request was not justified.  Given these 
shortcomings, Hong Kong, China believed that an alternative approach was warranted.  Under the 
suggested approach, there would be a presumpti on of acceptance of all requests to join in 
consultations by third-country Members, unless the responding Member and complaining Member 
either decide jointly or separately to reject the re quest.  The advantages of this proposal were that it 
minimised the risk of the responding Member rejecting a third-country Member depending on whether or not it was supportive of its position in th e dispute.  In that context, it addressed the 
concerns of the G-7 relating to discrimination among Members.  It further provided some flexibility 
for the parties in line with the desire to retain  some Member control over the dispute settlement 
system.  As previously noted, the responding Memb er and the complaining Member could reject a 
particular request from a third-country Member, if th ey believed that the partic ipation of third parties 
would, for example, complicate efforts to reach a mu tually satisfactory solution in the dispute.  She 
said that Hong Kong, China was looking forward to a fruitful discussion of the proposal and was ready to respond to any questions that Members might have.   
3. The Chairman
 thanked Hong Kong, China for its c ontribution and invited Members to 
provide their comments informally on the proposal .  After the discussion, the Chairman thanked 
Members for their active participation and said that it was apparent from the discussions that 
Members had different views on how the rights of third parties could be enhanced in the dispute settlement system.  He expressed his gratitude to  Hong Kong, China for agreeing to hold further 
discussions with other Members on the proposal.   
4. The Chairman then invited Japan and the Eu ropean Union to present their joint proposal 
which had been circulated as Job(05)/47/Add.1.  But before doing so, he said that it was his 
understanding that the proposal elaborated on a specific aspect of the broader issue of "post-retaliation", which was originally covered in  an earlier proposal by the proponents (Job(05)/47). 
5. The representative of Japan
 said that the present proposal by Japan and the European 
Communities (EC) elaborated on an earlier proposal relating to the creation of a specific 
post-retaliation procedure under which an existing DSB authorization to suspend obligations would be 
removed, once the implementing Member had achie ved compliance.  The earlier proposal which was 
submitted in 2005 did not include an explicit mech anism to adjust the authorized suspension of 
obligations following a compliance review with a negative outcome for the implementing Member.  
This was now addressed in the current proposal by  the introduction of a new paragraph 8(e) of 
Article 22.  The EC and Japan had come to the c onclusion that such a provision would be a necessary 
component of the improved post-retaliation procedure.  It appeared both fair and useful that the DSU 
was equipped with a mechanism for upward adjustment of the retaliation if the level of nullification or 
impairment had become higher as a result of the im plementing Member's new measures.  Conversely, 
when that level had dropped, downward adjustment  should be possible.  The EC and Japan did not 
believe that introducing a provision which en abled such downward adjustment created a 
counter-productive incentive to an implementi ng Member not to comply fully with the 
recommendations and rulings of the DSB.  He recalled that a procedure for the adjustment of the level of retaliation was also contained in earlier texts produced in these negotiations.  The current proposal 
was based on previous proposals, but also on the wisdom accumulated during these negotiations.  In formulating the proposal, the EC and Japan had been  guided by the desire to encompass all possible 
scenarios that could occur under the dispute settleme nt system.  They had also followed the same 
basic approach under Articles 22.6 and 22.7 of the DSU.  Specifically, the complaining Member 
might request the modification of the authorized leve l or form of retaliation.  The Member concerned 
might then refer the matter to arbitration if it object ed to the new level or form of retaliation proposed 
by the complaining Member.  In the absence of a modification request by the complaining Member, 
the Member concerned might object to the previous ly authorized level of retaliation and refer the 
matter to arbitration.  The present proposal was wit hout prejudice to the interpretation of the current  TN/DS/M/32 
 Page 3 
 
 
  rules of the DSU with regard to the post-retaliation situation.  The EC and Japan believed that it was 
best to approach these questions from an objec tive and systemic perspective in the present 
negotiations.  The EC and Japan looked forward to ot her Members' reactions to the proposal and the 
opportunity to work further with other Members with a view to agreeing on a post-retaliation procedure and on compliance review in its entirety. He  said that the EC and Japan would continue to 
engage in the currently ongoing exercise of impr oving the legal drafting of submitted proposals.  
Once the work on post-retaliation had been conclu ded, the EC and Japan would submit a revised 
version for the entire text of Article 22.8 of the DSU with a view to ensuring consistency with the 
wording in other relevant provisions. 
6. The Chairman
 thanked the EC and Japan for their contribution and invited Members to 
provide their comments informally on the proposal.  After the discussion, he thanked Members for 
their constructive engagement and said that it was cl ear a number of elements needed to be explored 
further.  He then invited the United States to pr esent its proposal, which had been circulated as 
TN/DS/W/86.  He said that it was his understanding that the present proposal further elaborated the 
earlier contribution of the United States on transparency.   
7. The representative of United States  said that Members were aware that the United States had 
long advocated greater transparency in the WTO di spute settlement system as a way of improving the 
system.  There were several advantages to greater transparency.  Greater transparency could improve 
public confidence in the fairness of the dispute se ttlement system at the WTO.  Enhanced public 
confidence, in turn, could improve the operation of the system, as greater public confidence could translate into greater support for the implemen tation of DSB recommendations and rulings.  And 
greater transparency benefited WTO Members that were not a party or third party to a dispute, 
including by assisting them in deciding whether to  become third parties in disputes.  The United 
States had previously proposed draft amendments to the DSU and draft DSB decisions to provide 
greater transparency (in TN/DS/W/46).  At the pr esent meeting, the United States was responding to 
comments of other Members by proposing some revisions  to the legal drafting.  The revised legal text 
would continue to address the objective of greater transparency by allowing the public to observe all 
substantive panel, Appellate Body  and arbitration meetings, by ma king submissions and statements 
public and by providing for final repor ts to be made available to Members and to the public once they 
had been issued to the parties.  And as had been  indicated before, the United States had taken note 
with interest of the procedures proposed by the European Communities for handling amicus curiae 
submissions and looked forward to working with the EC and other Members on this issue.  In 
proposing these revisions, the United States appreciated the comments received from other 
delegations.  The United States had particularly trie d to respond to what appeared to be three key 
drafting guidelines that would benefit any legal drafting work on the covered agreements.  These 
were:  first, to use the same term throughout to mean the same concept and, second, wherever 
possible, to use singular rather than plural terms; and third, wherever possible, avoid the use of the 
passive voice.  The United States looked forward to hearing Members' views on these proposals as 
well as those it had previously tabled. 
8. The Chairman
 thanked the United States for its proposal and its responses to the questions 
posed by Members.  He also thanked Members fo r their constructive engagement and said that the 
discussion had revealed that there were areas which n eeded to be explored further.  He invited New 
Zealand on behalf of the G-6 to present their proposal  on remand authority for the Appellate Body.    
9. The representative of New Zealand  said that the proposal by the G-6 was a revision of an 
earlier proposal by the G-6 on remand authority for the Appellate Body.  Textually, the revised proposal was an improvement over the earlier proposal .  It had been drafted taking into account the 
views expressed by Members during informal consu ltations.  She said that the G-6 was ready to 
respond to the questions that Members might have wh en the meeting switched to an informal mode.   TN/DS/M/32 
Page 4  
 
  10. The Chairman
 thanked the G-6 for their revised propo sal and their responses to the questions 
posed by Members.  He also thanked Members fo r their constructive engagement and said that the 
discussion had revealed that there were issues that needed to be discussed further.  He expressed his 
appreciation to Members who had responded to his plea that proposals should be submitted as rapidly 
as possible to the Special Session.  He also we lcomed increased consultations among Members and 
noted that this had made it possible for revised text s to be submitted to the Special Session.  He said 
that it was his understanding that further informal work was continuing, particularly within the 
Mexican Group, and reminded Members that such meetings were open-ended and that greater 
involvement by them could be beneficial for the process.  He encouraged Members that were still 
working towards the submissions of contributions to also consult informally with other Members.  If 
the Special Session were to have text-based negotia tions by the summer, then Members should submit 
their proposals as rapidly as possible.  It would have been preferable if Members had submitted their contributions before the present meeting.  It was important to have a clearer picture of where the 
Special Session was heading and what it was aiming fo r.  He invited delegations that had indicated in 
the past that they were working on contributions to  give an indication when they would submit their 
proposals to the Special Session.  He recalled that  India had informed the Special Session at its 
previous meeting that it was working with some Members on development-related issues and was also 
in consultations with other de veloping-country groupings, including the African Group.  He then 
invited India to take the floor. 
11. The representative of India
 said that India had been working intensively within the 
"like-minded group" which had a number of proposals (TN/DS/W18, W19 and W47) on the table and 
was presently engaged in consulta tions with other Members on these proposals.  Work was relatively 
advanced and it had been expected to present re vised proposals to the Special Session before its 
present meeting.  However, it had not been possible to  do so and it was the expectation of India that 
they would soon be submitted to the Special Session fo r its consideration.  India was also consulting 
with the LDC Group and the African Group with a vi ew to exploring commonalities in their proposals 
and making a submission to the Special Session.  Furthermore, India had been working in other 
forums with some Members on issues of interest to developing countries.  The objective was to 
develop a coherent proposal encompassing exis ting textual proposals and other proposals for 
submission to the Special Session.  He reiterated that  while India agreed that the pace of work should 
be quickened, the Special Session had not agreed on any deadlines.  India was committed to working 
as rapidly as possible and would be submitting revised  proposals with its co-sponsors to the Special 
Session after preferably discussing them within the Mexican Group.    
12. The Chairman  thanked India for the information it shared with the Special Session and 
expressed the hope that India and its co-sponsors w ould soon be submitting revised proposals to it.  
He welcomed the intention of India and its co -sponsors to hold informal consultations on the 
proposals within the Mexican Group.  He said that his plea to delegations to submit proposals on a 
timely basis was meant to pave the way for text-based negotiations as soon as possible, preferably by 
the summer break.  He reiterated that no deadlines ha d been agreed by the Special Session and that the 
dates proposed were merely indicative intended to assist the Special Session to comply with its ministerial mandate.   
13. The representative of Nigeria
 said that the African countri es were currently engaged in 
intensive consultations to revise their proposals.  They had had contact with other Members, including 
India regarding proposals of common interest.  On ce work on these proposals had been completed, it 
was the intention of the African Group to di scuss them as widely as possible with other 
developing-country Members, including with India and other members of the "like-minded group" and also present it for Members’ reactions in the Mexican Group.  He supported the statement by India that while the pace of work should be quicken ed, there had not been any agreement on deadlines 
in the Special Session.    TN/DS/M/32 
 Page 5 
 
 
  2. Other Business 
14. The Chairman  recalled that in May 2003, the Speci al Session of the Committee on Trade and 
Development referred a number of special and di fferential treatment (SDT) provisions, otherwise 
known as "Category II" proposals, to the Special S ession with a specific instruction that they be 
considered as soon as possible and on the basis of "a specifically drawn-up time schedule of work".  
In October 2005, consideration of these proposals wa s postponed, at the request of the proponents, on 
the understanding that they would be taken up after the Hong Kong Ministerial Conference meeting.  
Following his assumption of the Chairm anship of the Special Session, he and other chairpersons of 
WTO bodies had been requested to provide updates on work on these proposals.  He had informed the 
Chairman of the CTD Special Session at the end of March 2006 that the Special Session had resumed 
its work and was intending to meet approximately once a month until the summer, and that while no 
specific date had yet been set to discuss these Catego ry II proposals, it was his intention to schedule a 
meeting as soon as possible to take up this issue.   He asked whether the proponents could give an 
indication when they would like consideration of th ese proposals to take place.  He said that he and 
the Secretariat were available to provide any assist ance that might be required to facilitate discussion 
of these proposals.  He invited India to take the floor.   
15. The representative of India  said that among the proposals being discussed within the "like-
minded group" were the Category II proposals.  While work had progressed sufficiently well, the Group had not finished its consideration of one pa rticular Category II proposal.  India was working 
intensively with its co-sponsors, but it could not give  any firm date when they would be submitted to 
the Special Session.  However, India was committed  to finalizing work on these proposals as rapidly 
as possible, so that they could be examined by the Special Session.   
16. The representative of Nigeria
 said that the African Group was working on the Category II 
proposals but like India, it could not give a firm date when they would be submitted to the Special Session for its consideration.  The Group was, how ever, determined to submit the proposals as soon as 
possible, so that a thorough discussion could be held on them in the Special Session, preferably after 
they had been discussed in the Mexican Group.   
17. The Chairman
 thanked India and Nigeria for their statem ents and said that the next meeting of 
the Special Session was scheduled to take place on 22-23 May.   
 
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