WORLD TRADE  
ORGANIZATION  WT/DS323/R 
1 February 2006 
 (06-0435) 
 Original:   English 
  
 
     
 
    
JAPAN – IMPORT QUOTAS  ON DRIED LA VER AND 
SEASONED LA VER 
 
 
Report of the Panel  WT/DS323/R 
 Page 1       
 
 
  1. On 1 December 2004, Korea requested consultatio ns with Japan pursuant to Article 4 of the 
Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU), Article 
XXIII:1 of the General Agreement on Tariffs and Trade 1994 (GATT 1994), Article 19 of the 
Agreement on Agriculture, and Article 6 of the Agreement on Import Licensing Procedures 
(Licensing Agreement) regarding Japan's impor t quotas on dried laver (1212.20-1-(1)) and seasoned 
laver (2106.90-2-(2)-E-(b)).  The request was circulated to Members on 3 December 2004.1 
2. Consultations were held on 23 December 2004 a nd 21 January 2005, but these did not lead to 
a mutually satisfactory resolution of the matter. 
3. On 4 February 2005, Korea requested the Dis pute Settlement Body (DSB ) to establish a panel 
pursuant to Article 6 of the DSU, Article XXIII:2 of the GATT 1994, Article 19 of the Agreement on 
Agriculture, and Article 6 of the Licensing Agreement.2 
4. At issue were the import quotas imposed by Jap an on dried laver (classified in Japan's 
customs tariff schedule under line 1212.20-1-(1)) and seasoned laver (classified in Japan's customs 
tariff schedule under line 2106.90-2-(2)-E-(b)) an d the administration of these quotas by Japan.  
Korea claimed that the import quotas on dried and seasoned laver are inconsistent with Japan's 
obligations under Article XI of the GATT 1994 and Ar ticle 4.2 of the Agreement on Agriculture and 
that the administration of these quotas is incons istent with Article X:3(a) of the GATT 1994.3 
5. On 21 March 2005, the DSB established the Panel with the following terms of reference:  
"To examine, in the light of the relevant provisions of the covered 
agreements cited by Korea in document WT/DS323/2, the matter referred to the DSB by Korea in that document, and to make such 
findings as will assist the DSB in making the recommendations or in 
giving the rulings provided for in those agreements."
4 
6. On 18 May 2005, Korea requested the Director-G eneral to determine the composition of the 
Panel, pursuant to paragraph 7 of  Article 8 of the DSU.  On 30 May 2005, the Director-General 
composed the Panel as follows: 
  Chairman: Mr Manzoor Ahmad 
  Members: Mr José Alfredo Graça Lima     M r  H e l g e  S e l a n d
5 
7. China, the European Communities, New Zealand and the United States reserved their rights to 
participate in the Panel proceedings as third parties.6 
8. The Panel met with the parties on 30 and 31 August 2005.  The Panel met again with the 
parties on 11 and 12 October 2005. 
                                                      
1 "Japan – Import Quotas on Dried Laver and Seasoned Laver.  Request for Consultations by Korea".  
WT/DS323/1, 3 December 2004. 
2 "Japan – Import Quotas on Dried Laver and Seasoned Laver.  Request for the Establishment of a 
Panel by Korea".  WT/DS323/2, 7 February 2005. 
3 Ibid. 
4 "Japan – Import Quotas on Dried Laver and Seasoned Laver.  Constitution of the Panel Established at 
the Request of Korea".  WT/DS323/3, 31 May 2005, para. 2. 
5 Ibid. , para. 4. 
6 Ibid.,  para. 5. WT/DS323/R 
Page 2  
 
  9. China, the European Communities and New Zeal and made third-party submissions to the 
Panel.  These countries, as well as the United States,  made oral statements during the first substantive 
meeting of the Panel. 
10. During the Panel proceedings, Korea requested th e Panel to find that Japan's import quotas on 
dried laver and seasoned laver were inconsistent with Japan's obligations under Article XI:1 of the 
GATT 1994, Article 4.2 of the Agreement on Agricultu re and that the administration of these quotas 
was inconsistent with Article X:3(a) of th e GATT 1994 and to recommend that Japan bring its 
measures into conformity with its obligations unde r these agreements.  Japan responded that its Laver 
Import Quotas Regime was outside the scope of the Agreement on Agriculture, that it was justified by 
Article XI:2(c)(i) of the GATT 1994 and that it was fu lly consistent with Article X:3(a) of the GATT 
1994. 
11. The Panel issued the Descriptive Part of its report on 18 November 2005.  Comments on the 
Descriptive Part of the report were received from Korea and Japan (on 5 December 2005) and from 
New Zealand (on 2 December 2005).  China and th e United States expressed that they had no 
comments. 
12. On 30 November 2005, the Chairman of the Panel informed the DSB, under Article 12.9 of 
the DSU, that the Panel would not be able to issue its report within six months of the agreement on the 
composition and terms of reference of the Panel (Ar ticle 12.8 of the DSU).  The Panel informed the 
DSB that it expected to complete its work by March 2006.
7 
13. According to the timetable adopted by the Pane l after consultations with the parties, the 
Interim Report was scheduled to be issu ed by the Panel on 27 January 2006. 
14. On 23 January 2006, pursuant to Article 3.6 of the DSU, the parties notified the DSB and the 
relevant Councils and Committees that they had reached a mutually agr eed solution, which was 
circulated as document WT/DS323/5 on 27 January 2006. 
15. The Panel takes note of the mutually agreed solu tion between the parties to the dispute and of 
Article 3.7 of the DSU, which provides that: 
"...The aim of the dispute settlement mechan ism is to secure a positive solution to a 
dispute.  A solution mutually acceptable to th e parties to a dispute and consistent with 
the covered agreements is clearly to be preferred..." 
16. The Panel likewise takes note of Article 12.7 of the DSU: 
"Where the parties to the dispute have fa iled to develop a mutually satisfactory 
solution , the panel shall submit its findings in the form of a written report to the DSB.  
In such cases, the report of a panel shall set  out the findings of fact, the applicability 
of relevant provisions and the basi c rationale behind any findings and 
recommendations that it makes.  Where a settlement of the matter among the parties 
to the dispute has been found , the report of the panel shall be confined to a brief 
description of the case and to reporting that  a solution has been reached."  (Emphasis 
added.) 
                                                      
7 "Japan – Import Quotas on Dried Laver and Seasoned Laver.  Communication from the Chairman of 
the Panel ".  WT/DS3 23/4, 8 December 2005.  WT/DS323/R 
 Page 3       
 
 
  17. In view of the above, and keeping in mind its fu nctions as set out in Article 11 of the DSU, 
the Panel concludes its work by reporting that a mu tually agreed solution to  this dispute has been 
reached between the parties. 
 
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