RESTRICTED  WORLD TRADE  
ORGANIZATION  TN/DS/M/31 
26 June 2006 
 (06-3112) 
Special Session of the Dispute Settlement Body 
21 March 2006  
 
 
MINUTES OF MEETING 
 
Held in the Centre William Rappard  
on 21 March 2006  
 
Chairman: Mr. Ronald Saborío Soto (Costa Rica) 
  
 The Chairman  welcomed delegations to the thirty-fourth meeting of the Special Session and 
said that the airgram for the meeting had been circ ulated in WTO/AIR/2777 and that the draft agenda 
(TN/DS/W/84) contained two items, namely: (i) discu ssion of contributions by delegations; and (ii) 
"Other Business".  With respect to the first agen da item, he said that three proposals had been 
received since the previous meeting of the Special Se ssion.  The first was an informal contribution by 
Argentina, Brazil, Canada, India, Mexico, New Zeal and and Norway, circulated as Job (05)/19/Rev.1.  
The second was an informal contribution from Canada, circulated as Job (06)/56, while the third was 
a contribution from the United States, circulated as TN/DS/W/82/Add.2.  It was his intention to ask the proponents to present their proposals and then open the floor for comments from Members.  He 
further said that it was not his intention to rais e 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 agenda.  The agenda of the meeting was then adopted as amended. 
 
1. Discussion of Contributions from Members 
 
 The Chairman
 thanked the delegations which had subm itted contributions and said that given 
the looming deadlines, it was important for de legations which were thinking of submitting 
contributions to do so as soon as possible.  It was his understanding that the contribution by the Group 
of Seven Countries (G-7) – Argentina, Brazil, Ca nada, India, Mexico, New Zealand and Norway – 
was a revision of their earlier proposal on third pa rty rights.  The new proposal had taken into account 
the comments provided by Members during informal  consultations, such as those facilitated by 
Mexico.  He invited Canada on behalf of the G-7 to present the revised proposal.   
  The representative of Canada
 said that this proposal was a revised version of the proposal on 
third party rights that the G-7 had submitted to the Special Session some time ago.  In revising this 
proposal, the G-7 had taken into account the views and drafting suggestions made by Members during 
informal consultations, particularly in the cont ext of the Mexican Group meetings.  He thanked 
Mexico for facilitating these meetings and also de legations which had commented on the proposal.  
The G-7 was confident that this revised proposal wa s clearer and far better textually.  He highlighted 
the changes in the revised proposal.  With respect to  Article 10.2 of the DSU, the scope of the rights 
of third parties had been clarified, particularly th eir right to respond to questions both orally and in 
writing to questions of the panel.  As regards Ar ticle 10.3, the language of the original draft was 
unclear.  The new formulation in parenthesis ha d captured the intention of the proponents and 
improved the text.  Regarding Article 17.4, the ch anges introduced in paragr aph (b) reflected more 
accurately the original intention of the G-7.  Some  consequential changes had been made to paragraph 
6 of Appendix 3.  The G-7 had taken on board the vast majority of drafting suggestions made by 
delegations.  In that context, it would be advi sable for Members to be guided by the following 
principles when drafting proposals.  First, the proposal and the draft language should refer to each TN/DS/M/31 
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  party.  This would avoid any conf usion and make clear the obligations  of each party.  Second, it was 
better to draft in the active voice rather than in the passive voice.  This method of drafting clarified the obligations of each party.  Third, proposals should closely reflect existing language in other parts of 
the DSU, so that any change in language was not take n to reflect a change in intention or a conceptual 
change.  Finally, he said that the G-7 had taken careful note of the suggestions made by Members 
concerning third parties joining consultations under Article 4.11.  After careful reflection, however, 
the G-7 believed that its proposal had struck a careful  balance between the rights of third parties and 
those of the parties to the dispute.  From an in tellectual and policy perspective, the proposal was 
coherent.  However, the G-7 was open to further su ggestions to improve the proposal and also looked 
forward to the moment when negotiations could begin on texts. 
 
 The Chairman
 thanked Canada and its partners for th eir contribution and invited Members to 
provide their comments informally on the three su b-themes addressed in the proposal starting with 
third party rights.    
 The representative of India
 associated his delegation with the statement made by Canada on 
behalf of the G-7 and thanked the Chairman for his introductory statement as well as the encouragement to delegations to come forward with proposals to the Special Session as soon as 
possible.  This revised proposal by the G-7 was an example of the efforts of India and other countries in responding to the plea by the Chairman.  I ndia was working in various groups and formats and 
expected to submit contributions to the Special Sessi on in due course.  In reference to the Chairman's 
introductory statement concerning deadlines, he said that while work should proceed at a quickened 
pace, no deadlines had been agreed  by the Special Session.   
  The Chairman
 thanked India for its statement and recalled that in his statement after being 
appointed as Chair, he had clarified that the time lines were merely indicative and designed to assist 
Members to fulfil the obligation of completing the negotiations as rapidly as possible.  He thanked 
Members for their comments on the G-7 proposal and said that it was apparent from the discussions that Members still had different views on how the righ ts of third parties should be enhanced at various 
stages of the dispute settlement process.  The di fferences seemed to be more pronounced on the rights 
to be given to third parties at  the Appellate Body stage.   
 
 The Chairman then invited Canada to presen t its proposal which had been circulated as 
Job(06)/56.  But before doing so, he said that it was his understanding that the proposal was not new 
and that it was a revised version of an earlier pr oposal by Canada on the handling of confidential 
information in the course of dispute settlement proceedings.    
 The representative of Canada
 said that this proposal was a revision of an earlier proposal 
(TN/DS/W/41), which was submitted to the Special S ession in 2003.  It dealt with the concept of the 
maintenance of some form of confidentiality fo r proprietary informati on submitted during dispute 
settlement proceedings.  In the course of discussion s with Members, Canada had recognized that its 
earlier proposal was unclear in certain respects and could benefit from additional refinement.  
Members' experiences with the dispute settlement sy stem had demonstrated the need for effective 
procedures for handling confidential information.  In  that regard, it was appropriate to distinguish 
between on the one hand, the confidentiality of th e process and on the other hand the confidentiality 
of information submitted during the process.  The propo sal was intended to deal with the latter issue.  
The party submitting the information might consider it to be confidential or seek protection on the 
grounds that it had some proprietary value.  Put di fferently, the information might have some financial 
or commercial value for private parties.  The propo sal had been refined to broaden the concept of 
confidentiality.  It now referred to strictly conf idential information and c ontained a new definition 
which was broadly based on Article 39 of TRIPS Agre ement.  Attempts had been made to prevent the 
abuse of these procedures by Members who might try to designate information that was neither 
confidential nor had any proprietary  value.  While the earlier proposal only covered the panel process,  TN/DS/M/31 
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the revised proposal had been expanded to cove r other circumstances during dispute settlement 
proceedings, such as arbitrations and procedures under Annex V of the Agreement on Subsidies and 
Countervailing Measures.  The proposal had also urged a revamping of Article 18 of the DSU in light 
of the discussions on transparency and the need to provide additional guidelines for the handling of 
strictly confidential information.  As a supporter of  the enhancement of transparency in the dispute 
settlement system, Canada recognized the need to wo rk further with Members to better integrate the 
concept of transparency in to the current proposal.  
  The Chairman
 thanked Canada for its proposal and suggested that Members provide their 
comments informally.  After the discussions, the Chairman thanked Members for their comments 
which showed that further work on some elements of the proposal might be necessary.  He also 
thanked Canada for agreeing to work further with Me mbers to refine the proposal.  He said that the 
next proposal to be discussed was that of the Un ited States.  It was his understanding that the 
proposal, circulated as TN/DS/W/82/Add.2, furt her elaborated on one of issues – measures under 
review – in the earlier proposal of the United St ates on Member control and flexibility, submitted 
sometime ago to the Special Session.  He inv ited the United States to present its proposal.   
  The representative of the United States
 welcomed the opportunity to introduce its additional 
proposal on parameters concerning the measure under review in dispute settlement. The proposal was 
part of the overall proposal on improving flexibility and Member control in WTO dispute settlement. As Members might recall, the United States had prev iously submitted proposals for parameters on the 
use of public international law in dispute settlement as well as on the interpretive approach to use in 
dispute settlement.  This latest proposal was intended to complement the two previous ones in order to 
provide further guidance to WTO adjudicative bodies in carrying out the tasks entrusted to them.  
Members would recall that when the United States tabled the two previous proposals, it had explained that it would be tabling a proposal on the measure u nder review.  The purpose of this latest proposal 
was to enhance the ability of the WTO dispute settleme nt system to carry out its central objective of 
promoting the prompt resolution of disputes between parties.   As with the prior two proposals, the US proposal under discussion at the present meeting recognized that there were areas in which it would be useful for Members to provide their views 
rather than to leave WTO adjudicative bodies guessi ng as to Members' desires.  Furthermore, the 
proposal sought to address some of the issues with which parties, panels a nd the Appellate Body had 
recently wrestled and to ensure that Members had a chance to express their desi re in terms of how the 
system should deal with these issues.  In particular , this proposal addressed three areas. The first area 
concerned the order of analysis that was appropriate  in dispute settlement. This part of the proposal 
sought to ensure that dispute settlement was work ing to resolve actual disputes and clarifying the 
application of the covered agreements in the contex t of a particular dispute, rather than addressing 
hypothetical situations or rendering authoritative in terpretations of the cove red agreements in the 
abstract.   In this connection the proposal emphasized that  the order of analysis should respect the fact 
that findings needed to relate to a measure actua lly taken by a Member affecting the operation of a 
covered agreement and not to h ypothetical situations. The second ar ea concerned the definition of 
a measure.  While it would appear ill advised to atte mpt to craft a definition of "measure" that would 
apply to each and every provision of  every covered agreement, there was room for guidance on what 
was a measure, including by providing guidan ce on what was not a measure.  The third area 
concerned the distinction between mandatory an d discretionary measures and the usefulness of 
clarifying the ability of Members to challenge a measu re that is mandatory but not yet in effect.  It 
also addressed the situation where a Member had di scretion under its measure allowing it to act either 
consistently or inconsistently w ith its obligations.  The question in  that situation was whether WTO 
adjudicative bodies would be justified in presuming th at the Member would act in bad faith and would 
deliberately exercise its discretion to breach its obligations.    
 TN/DS/M/31 
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   All three of these issues have taken the time and resources of Members in particular disputes 
but without the Membership providing guidance to help  panels, the Appellate Body or arbitrators to 
manage these issues on a systemic basis.  The United States believed that it would be in the interest of 
all Members to provide such guidance.  While th e United States had suggested parameters in the 
present proposal, it was referring to them as "draft" parameters because it believed that each of these 
areas could benefit from discussion among the Member s, recognizing that there were several possible 
ways to express each of these.  The United States had suggested language at this level of detail to 
avoid being overly prescriptive.  It could envision th e language being adopted in something akin to its 
current form, after reflecting discussions among Me mbers.  Members were uniquely qualified to 
provide guidance in these areas since ultimately the WTO dispute system needed to address the needs 
of Members. The United States would suggest that the most appropriate means to provide additional 
guidance in these areas was not through an amendm ent to the DSU but rather through some other 
more flexible means, such as through an author itative interpretation by the General Council or 
Ministerial Conference, or through a decision by the DSB.    
 The United States looked forward to hearing Me mbers' views on these issues as well as those 
it had previously tabled.  It looked forward as well to further refining the guidance so as to enhance the ability of the dispute settlement system to better fulfill its basic purpose.   The Chairman
 thanked the United States for its cont ribution and invited Members to provide 
their comments informally.  After the discussion, he  thanked Members for their active participation 
and said that while the discussion had been useful , there were still some issues which had to be 
discussed further.  He also thanked Members who in response to his appeal had submitted 
contributions and asked those working on new or revi sed contributions to come forward with them as 
soon as possible.  He asked them to provide updates on status of work and when they expected to 
submit them to the Special Session.   
 
 The representative of the European Communities  said that the European Communities was in 
the process of finalising a proposal on post-retaliation.  It was currently being discussed in the Mexican Group and should hopefully be submitted to the Special Session before its next meeting. 
  The Chairman
 thanked Members for their active par ticipation and asked delegations who 
were working on contributions to keep him abreast of any developments.  He announced that the next 
meeting of the Special Session would take place on 24-25 April 2006.   
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