RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/DSB/M/259 
6 February 2009 
 (09-0501) 
Dispute Settlement Body 
17 November 2008  
 
 
 
 
 
MINUTES OF MEETING 
 
Held in the Centre William Rappard  
on 17 November 2008  
 
Chairman:  Mr. Mario Matus (Chile) 
  
Subjects discussed
: Page  
 
1. Surveillance of implementation of recommendations adopted by the DSB.........................2  
(a) United States – Section 211 Omnibus Appropr iations Act of 1998:  Status report by 
the United States .............................................................................................................. ...........2  
(b) United States – Anti-dumping measures on certain hot-rolled steel products from 
Japan:  Status report by  the United States...................................................................................4  
(c) United States – Section 110(5) of the US Copyright Act:  Status report by 
the United States .............................................................................................................. ...........5  
(d) European Communities – Measures affecting the approval and marketing of biotech 
products:  Status report by the European Communities..............................................................5  
2. Mexico – Definitive countervailing measures on olive oil from the European 
Communities.................................................................................................................... ..........7  
(a) Implementation of the recommendations of the DSB.................................................................7  
3. United States – Continued Dumping and Subsidy Offset Act of 2000:  
Implementation of the recommenda tions adopted by the DSB ............................................8  
(a) Statements by the European Communities and Japan ................................................................8  
4. Thailand – Customs and fiscal measures on cigarettes from the Philippines....................10  
(a) Request for the establishment of a panel by the Philippines.....................................................10  
5. India – Additional and extra-additional duties on imports from the United States .........10  
(a) Report of the Appellate Body and Report of the Panel.............................................................10  
6. Adoption of the 2008 draft Annual Report of the DSB .......................................................14  
7. Proposed nomination for the indicative list of governmental and 
non-governmental panelists ...................................................................................................15  
 WT/DSB/M/259 
Page 2  
 
1. Surveillance of implementation of recommendations adopted by the DSB 
(a) United States – Section 211 Omnibus Appropr iations Act of 1998:  Status report by the 
United States (WT/DS176/11/Add.72) 
 (b) United States – Anti-dumping measures on certain hot-rolled steel products from Japan:  
Status report by the United States (WT/DS184/15/Add.72) 
 (c) United States – Section 110(5) of the US Copyright Act:  Status report by the United States 
(WT/DS160/24/Add.47) 
 
(d) European Communities – Measures affecting th e approval and marketing of biotech products:  
Status report by the European Communities (WT/DS291/37/Add.10 – WT/DS292/31/Add.10 – WT/DS293/31/Add.10) 
 1. The Chairman
 recalled that Article 21.6 of the DSU required that "unless the DSB decides 
otherwise, the issue of implementation of the re commendations or rulings shall be placed on the 
Agenda of the DSB meeting after six months follo wing the date of establishment of the reasonable 
period of time pursuant to paragraph 3 and shall remain on the DSB's Agenda until the issue is 
resolved".  He proposed that the four sub-items to which he had just referred be considered separately. 
(a) United States – Section 211 Omnibus Appropria tions Act of 1998:  Status report by the 
United States (WT/DS176/11/Add.72) 
2. The Chairman  drew attention to document WT/DS176/ 11/Add.72, which contained the status 
report by the United States on progress in the impl ementation of the DSB's recommendations in the 
case concerning US Section 211 Omni bus Appropriations Act of 1998. 
3. The representative of the United States  said that his country had provided a status report in 
this dispute on 6 November 2008, in accordance with Article 21.6 of the DSU.  As noted in that status 
report, a number of legislative proposals that would implement the DSB's recommendations and 
rulings in this dispute had been introduced in th e current Congress, in both the US Senate and the US 
House of Representatives.  The US administratio n continued to work with the US Congress to 
implement the DSB's recommendations and rulings. 
4. The representative of the European Communities  said that at the present meeting the 
United States was presenting its 72nd status report on  its lack of progress in the implementation of the 
DSB's ruling in this dispute.  In fact, since the condemnation of Section 211 in February 2002, the 
United States had failed to take any steps to implem ent the DSB's ruling.  The EC hoped that the next 
US Congress would finally put the United States in to compliance with its TRIPS obligations.  She 
then quoted the President elect:  "yes it can". 
5. The representative of Cuba  said that, on 29 October  2008, with an almost unanimous vote of 
185 member countries in favour, the General Assemb ly of the United Nations had, once again, 
approved, as it had done each year for the past 17 years, the resolution calling upon the United States to end the economic, commercial and financial blockade which it has maintained against Cuba since 
1962.  This was an unequivocal message from the international community.  The US policy of 
blockading Cuba, of which Section 211 formed part, had never been so isolated and discredited.  That 
isolation and unreasonable attitude was also reflected  in the DSB and this matter had remained on the 
DSB's Agenda for the past six years.  During that period of time the offender had persistently refused 
to comply with the DSB's ruling.  At the October DSB meeting, Cuba had point ed out that none of the 
legislative proposals which had s ought the repeal of Section 211 had succeeded.  Section 211, which 
affected the registration of Cuban intangible assets, had been passed on 21 October 1998 and was still 
in force, ten years after it had been introduced.  Such legislation violated the national and most- WT/DSB/M/259 
 Page 3 
 
 
  favoured-nation treatment obligations under the TR IPS Agreement and the Paris Convention for the 
Protection of Industrial Property, as the Appellate Body had confirmed in 2002.  The prolonged delay 
by the offender in the implementation of the Appella te Body's rulings violated the DSU principle of 
speedy compliance.  The current US administrati on had made no effort whatsoever to show its 
readiness to comply with the international rule of law, or with the DSB's decisions.  Its double 
standards with regard to intellectual property rights were scandalous.  There was no need to go further 
than to note that in October 2008, when ten year s had passed since the introduction of Section 211, 
the United States, the offending country, had passed new legislation designed to strengthen even more 
the observance of its intellectual property rights.  In  other words, the message was clear:  what applied 
for the United States did not apply for the rest of th e membership, i.e. "do what I say, but not what I 
do".  On 28 October 2008, the meeting of the TRI PS Council had been held.  Much time had been 
devoted to giving developed Members an opportunity to raise questions and concerns with regard to 
compliance.  The parties to this dispute had show n great concern over these matters and had called on 
other Members to adopt concrete measures.  It was deplorable that, in view of the existence of so 
many questions that required debate  as regards the implementation of this Agreement, delegations had 
spent a great amount of time to listen to those respons ible for the failure to settle this dispute blamed 
others over matters of enforcement.  It was clear that the agreed multilateral framework of principles, 
rules and disciplines with regard to intellectual pr operty was applicable whoe ver was the legal subject. 
6. The representative of Brazil  said that his country thanked the United States for the status 
report.  As on previous occasions, Brazil wished to point out that the DSB had seen no progress in the 
implementation of the recommendations, nor had the DSB been sufficiently informed of any specific 
initiatives undertaken by the US administration.  The l ack of compliance in this dispute was a cause of 
concern not only for the complainants, but also fo r the broader Membership that relied on prompt 
settlement of disputes as one of the core principles of the WTO.  Brazil, therefore, urged the United States to implement the DSB's recommendations in this dispute.  
7. The representative of India
 said that her country wished to thank the United States for its 
status report concerning the surveillance of implem entation in this dispute and expressed, once again, 
its concerns about this case.  As stated before, the situation of non-compliance continued in this 
dispute, despite all endeavours of the US administration in working with the US Congress.  India, once again, reiterated the view that full implementa tion of the DSB's recommendations in this dispute 
was necessary for the purpose of the case at hand and al so due to the systemic considerations relating 
to the effectiveness and reliability of  the WTO dispute settlement system. 
8. The representative of Mexico
 said that the DSU stipulated that "prompt compliance with 
recommendations or rulings of the DSB" was essen tial in order to ensure effective resolution of 
disputes "to the benefit of all Members", as stated in Article 3.3 of the DSU.  Mexico, therefore, urged 
the parties to this dispute to adopt the measures in order to come into compliance with the DSB's 
recommendations and rulings to the benefit of all Members. 
9. The representative of Nicaragua  regretted that, thus far, no progress had been made in the 
implementation of the DSB's rulings in this dispute.   Nicaragua maintained its systemic concerns at 
this lack of compliance.  At no point either in the course of 2008 had there been any clear sign of a 
willingness to comply with the DSB's recommendations.  Nicaragua hoped that the new US administration would be able to improve the US r ecord of compliance in this matter, and urged the 
United States to bring its legislation swiftly into conformity as a means of ensuring satisfaction for the 
parties and the orderly conduct of multilateral trade and its dispute settlement mechanism. 
10. The representative of Thailand
 said that his country thanked the United States for its status 
report.  Like previous speakers, Thailand remained concerned about the systemic implications of this 
dispute.  Non-implementation of the DSB's rulings and recommendations undermined the integrity of WT/DSB/M/259 
Page 4  
 
the rules-based multilateral trading system.  Theref ore, Thailand urged the United States to take all 
necessary steps to comply with its obligations  under the TRIPS Agreement as soon as possible. 
11. The representative of China
 said that his country thanked the United States for its status report 
but, once again, that report did not show any progress in implementation.  China hoped that the new US Congress would realize that it was in the inter est of not only other Members, but also in the 
interest of the United States, to put an end to this  situation which was undermining the authority of the 
TRIPS Agreement and the creditability of the WTO dispute settlement system.  Therefore, China 
again wished to support the statements made by th e EC and Cuba and urged the United States to make 
an extra effort to bring itself into conformity  with the decision of the DSB as soon as possible. 
12. The representative of the Bolivarian Republic of Venezuela
 said that her country had taken 
note of the status report submitted by the United States and fully associated itself with the views 
expressed by Cuba.  Her country noted that the status  report by the United States failed to report on 
progress in this dispute, and regretted the US failu re to comply with the recommendations, which had 
been adopted by the DSB on this matter more than  six years ago.  Venezuela reiterated that the 
integrated dispute settlement system, which prohibit ed unilateral determinati ons, was being seriously 
undermined when Members disregarded their obligati ons.  Venezuela, along with other Members, had 
repeatedly expressed its concerns about the systemic implications of such cas es.  The fact that the 
complaints – both by the parties concerned an d by the other Members – were being ignored 
undermined confidence in the effec tiveness of the system.  Venezuela, therefore, once again urged the 
United States to take the necessary and urgent steps to comply with its obligations under the TRIPS 
Agreement. 
13. The representative of Bolivia  said that her delegation wished to express, once again, its 
concern regarding the status of this case and the fa ilure to comply with the WTO obligations.  Bolivia 
reiterated, once again, that the failure to achieve  progress had a negative impact on the credibility of 
the multilateral trading system and on the DSB, and altered the balance between the rights and 
obligations established under the WTO Agreements.  Once again, Bolivia urged the United States to 
comply with the DSB's rulings and recommendations and to make an effort to ensure that its 
authorities remove the restrictions imposed under Section 211. 
14. The representative of the United States  said that his delegation wished to react very quickly in 
response to Members' "systemic concerns".  The Unite d States again wished to set out the facts.  The 
record on the US compliance record was clear:  th e United States had come into compliance fully and 
promptly in a vast majority of its disputes, and as for the remaining few instances such as this one 
where the US efforts to do so had not yet been entirely successful, the United States continued to 
work actively towards compliance. 
15. The DSB took note  of the statements and agreed  to revert to this matter at its next regular 
meeting. 
(b) United States – Anti-dumping measures on certain hot-rolled steel products from Japan:  
Status report by the United States (WT/DS184/15/Add.72) 
16. The Chairman  drew attention to document WT/DS184/ 15/Add.72, which contained the status 
report by the United States on progress in the impl ementation of the DSB's recommendations in the 
case concerning US anti-dumping measures on certain hot-rolled steel products from Japan. 
17. The representative of the United States  said that his country had provided a status report in 
this dispute on 6 November 2008, in accordance with Article 21.6 of the DSU.  As of 
23 November 2002, the US authorities had addresse d the DSB's recommendations and rulings with 
respect to the calculation of anti-dumping margins in the hot-rolled steel anti-dumping duty investigation at issue in this dispute.  Details  were provided in document WT/DS184/15/Add.3.  The  WT/DSB/M/259 
 Page 5 
 
 
  US administration would continue to work with the US Congress with respect to the 
recommendations and rulings of the DSB that had not been already addressed by the US authorities 
by 23 November 2002. 
18. The representative of Japan  said that his country thanked the United States for its statement 
and latest status report.  Since the United States had taken certain measures to implement part of the 
DSB's recommendations in November 2002, as repor ted by the United States, there had been little 
tangible progress in this long-standing dispute regarding the remaining part of the DSB's recommendations and rulings.  A full and prompt implementation of the DSB's recommendations and 
rulings was "essential to the effective functioning  of the WTO and the maintenance of a proper 
balance of the rights and obligations of Members".
1  Japan wished to call on the United States to 
redouble its effort to this end. 
19. The DSB took note  of the statements and agreed  to revert to this matter at its next regular 
meeting. 
(c) United States – Section 110(5) of the US Copyright Act:  Status report by the United States 
(WT/DS160/24/Add.47) 
20. The Chairman  drew attention to document WT/DS160/ 24/Add.47, which contained the status 
report by the United States on progress in the impl ementation of the DSB's recommendations in the 
case concerning Section 110(5) of the US Copyright Act. 
21. The representative of the United States  said that his country had provided a status report in 
this dispute on 6 November 2008, in accordance with Article 21.6 of the DSU.  The US administration would work closely with the US Congr ess and continue to confer with the EC, in order 
to reach a mutually satisfactory resolution of this matter. 
22. The representative of the European Communities
 noted that this was the forty-seventh time 
the US reported continued non-compliance without o ffering any concrete means to bring itself into 
compliance.  The EC continued to think that that spoke for itself. 
23. The DSB took note  of the statements and agreed  to revert to this matter at its next regular 
meeting. 
(d) European Communities – Measures affecting the approval and marketing of biotech products:  
Status report by the European Communities (WT/DS291/37/Add.10 – WT/DS292/31/Add.10 – WT/DS293/31/Add.10) 
24. The Chairman
 drew attention to document WT/D S291/37/Add.10 – WT/DS292/31/Add.10 – 
WT/DS293/31/Add.10, which contained the status report by the European Communities on progress 
in the implementation of the DSB's recommendations in the case concerning the EC's measures 
affecting the approval and mark eting of biotech products. 
25. The representative of the European Communities  said that her delegation was happy to report, 
once more, that good faith cooperation between the comp lainants and the EC continued.  The EC kept 
a regular dialogue with the three complainants and held regular technical me etings which were aimed 
at addressing all relevant biotech-related issues of  their concern.  The seventh technical meeting 
between the EC and the United States had taken place on 22 and 23 October in a very constructive 
atmosphere.  Progress in the processing of pending a pplications and on national measures continued.  
Eighteen authorizations had been granted since the establishment of the WTO Panel, seven in 2007 
                                                      
1 Article 3.3 of the DSU. WT/DSB/M/259 
Page 6  
 
only.  Three authorizations had been granted in 2008, most recently on 29 October (LL25 cotton).  Two draft authorization decisions (oilseed ra pe T-45 and Roundup Ready 2 soybean) had been 
transmitted to the Council.  These applications could be authorized by the end of the year or early 
2009 at the latest.  Following the clarification by EF SA on concerns related to  the relevant antibiotic 
marker gene, expected by mid-December, the EC mi ght be in the position to authorize four more GM 
events (one GM potato and three maize hybrids) in early 2009.  This would mean six more 
authorizations in the months to come.  The EC be lieved that given the inevitably sensitive nature of 
biotech issues, dialogue was the appropriate way fo rward and remained open to continue discussions 
with the three complainants.   
26. The representative of the United States
 said that, as his country had noted at prior meetings of 
the DSB, the United States had serious concerns wi th the current operation of the system established 
by the EC for the purpose of reviewing and approving new biotech products.  The backlog of approximately 50 biotech product appl ications was even greater than the backlog that existed at the 
beginning of the reasonable period of time for co mpliance in November 2006.  This backlog resulted 
in continuous and serious trade harm  to US grain producers.  At the present meeting, the United States 
would like to comment on certain statements that the EC made at the October DSB meeting.  First, the 
EC asserted that the DSB should not be discussing is sues involving the backlog or the operation of the 
EC's approval system.  The EC's assertion w as, frankly, astonishing.  The rulings and 
recommendations adopted by the DSB included over 250 pages addressed solely to the operation of 
the EC approval system.
2  As a result of that exhaustive ex amination, the DSB had found that the 
manner in which the EC was operating – or, one might  say, failing to operate – its approval system 
resulted in "undue delay" in breach of the EC's obligations under the SPS Agreement.  There was no 
basis for the suggestion that the operation of th e EC's approval system should escape discussion by 
Members in the DSB. 
27. Second, the EC claimed that certain of the EC member State measures found by the DSB to 
be in breach of the EC's SPS obligations "hav e become obsolete".  The United States did not 
understand the meaning or relevance of this assertion.   The DSB had recommended that the EC bring 
the member States' measures into conformity with  the EC's obligations under the SPS Agreement.  
The EC must do so, regardless of whether the EC  unilaterally characterized such measures as 
"obsolete".  Finally, in its statement made at the pres ent meeting, the EC noted that in late October, it 
had finally made its third biotech approval in cal endar year 2008.  Regrettably, this recent approval 
only served to highlight the US concerns with th e EC approval system.  The variety in question 
received a final, positive safety assessment in Ap ril 2007 and yet it took the EC an additional 
18 months to issue an approval in accordance with its own assessment.  The United States thanked the 
DSB for its attention to this matter, and continued to urge the EC to take the steps necessary to allow 
the parties to make progress to wards resolving this dispute. 
28. The representative of Argentina  said that his country was grateful for the status report that had 
just been presented, and acknowledged that there ha d been a certain amount of progress, as mentioned 
by the EC.  However, there remained a number of c oncerns with respect to the process of approval of 
GMO events within the EC, particularly as regard s time-limits.  Another source of concern was the 
attitude shown by certain EC member States as we ll as the prohibitions that were still in force.  
Argentina would continue to work toge ther with the parties to this dis pute, in particular the EC, with a 
view to ensuring the definitive implementation of the recommendations. 
29. The representative of Canada  said that his country thanked the EC for its statement.  As 
previously mentioned, Canada had agreed to an ex tension of the reasonable period of time for the EC 
to bring itself into compliance with the DSB's fi ndings until 31 December 2008.   Canada had done so 
as it valued the constructive dialogue it had had to da te with the EC.  However, also as previously 
                                                      
 2 Panel Report:  "EC – Measures Affecting the Approval and Marketing of Biotech Products", 
WT/DS291/R, WT/DS292/R, WT/DS293/R, adopted 21 November 2006, Section VII.D, pages 427-692.  WT/DSB/M/259 
 Page 7 
 
 
  mentioned, Canada had significant ongoing concerns .  There were, for example, still member State 
bans in place on the cultivation and marketing of ap proved biotech products.  Further, Canada was 
very concerned that undue delays seem to be rea ppearing in the EC approval system for biotech 
products:  delays of the sort that had prompted Cana da to request this DSB process in the first place.  
As an example, Canada wished to cite the length of time taken – from 14 July to 30 October – for a 
product dossier to be forwarded for consideration to  the Council of Agriculture Ministers following an 
inconclusive vote on approval by the Standing Comm ittee on the Food Chain and Animal Health.  It 
was Canada's understanding that this should be a simple administrative process, requiring no more 
than three weeks.  No explanation had as yet b een given as to why over three months were necessary 
to complete the process in this case.  Canada w ould continue to monitor the situation closely. 
30. The representative of the European Communities  said that in response to the US comments on 
the EC intervention of 21 October, the EC was puzzled  about the US remarks.  The EC wished to ask 
the United States to confirm that, in this case,  the United States had challenged 27 specific product 
applications;  that the Panel had ruled on these 27 sp ecific product applications;  and that the Report 
also explicitly stated that the United States had not challenged the approval system as set out in 
legislation.  The EC, therefore, failed to see how one could argue that the report covered the operation 
of the system as such.  As regards national saf eguard, the EC had stated that these measures had 
become obsolete because the market authorizations fo r the products in question had expired, i.e. did 
not exist anymore, and the holders of the authoriza tions, the companies in question, had not asked for 
a renewal of the market authorization.  It was obvious, therefore, that the safeguard measures in 
question had become obsolete or, if it was any clear er in French, they had become "sans object". 
31. The representative of the United States  said that the US statement spoke for itself.  He noted 
that copies of that statement would be available af ter the meeting for the EC to consult.  If the EC 
required further clarification, perhaps the United Stat es could supply that in future statements or in 
another forum.  
32. The DSB took note  of the statements and agreed  to revert to this matter at its next regular 
meeting. 
2. Mexico – Definitive countervailing measur es on olive oil from the European 
Communities 
(a) Implementation of the recommendations of the DSB 
33. The Chairman  recalled that in accordance with the DSU provisions, the DSB was required to 
keep under surveillance the implementation of reco mmendations and rulings of the DSB in order to 
ensure effective resolution of disputes to the benefit of all Members.  In this respect, Article 21.3 of 
the DSU provided that the Member concerned shall in form the DSB, within 30 days after the date of 
adoption of the Panel or Appellate Body report, of its intentions in respect of implementation of the 
recommendations and rulings of the DSB.  He reca lled that at its meeting on 21 October 2008, the 
DSB had adopted the Panel Report in the case on "Mexico – Definitive Countervailing Measures on 
Olive Oil from the European Communities".  He inv ited the representative of Mexico to inform the 
DSB of Mexico's intentions in respect of  implementation of the DSB's recommendations. 
34. The representative of Mexico  said that on 21 October 2008 the DSB had adopted the Panel 
Report on:  "Mexico – Definitive Countervailin g Measures on Olive Oil from the European 
Communities" (WT/DS341).  In compliance with the provisions of Article 21.3 of the DSU, Mexico had requested the inclusion of this item on the Age nda of the present meeting in order to inform the 
DSB of its intention to implement the recommendations  and rulings of the DSB in this dispute in a 
manner which respected its WTO obligations.  Mexico was already working to this end, and was sure WT/DSB/M/259 
Page 8  
 
that it shall be able to reach an agreement with the EC with a view to establishing a reasonable period 
of time in accordance with Article 21.3(b) of the DSU. 
35. The representative of the European Communities
 said that the EC welcomed Mexico's 
statement of intentions, and hoped that Mexico would proceed to remove the measures found to be 
inconsistent with the SCM Agreement as soon as possi ble.  Given the violations identified in the 
Mexican measure, swift withdrawal was the only possible action. 
36. The DSB took note  of the statements, and of the information provided by Mexico regarding 
its intentions in respect of implementation of the DSB's recommendations. 
3. United States – Continued Dumping and Subsid y Offset Act of 2000:  Implementation of 
the recommendations adopted by the DSB 
(a) Statements by the European Communities and Japan 
37. The Chairman  said that this item was on the Agenda of the present meeting at the request of 
the European Communities and Japan.  He inv ited the respective representatives to speak. 
38. The representative of Japan  said that the latest distribution process for 2008 fiscal year under 
the CDSOA appeared to be well underway3 and was expected to be completed soon.  The CDSOA 
remained operational and, in the words of the US Cu stoms, "the distribution process will continue for 
an undetermined period".4  Japan urged the United States to immediately terminate the illegal 
distributions and to repeal the CDSOA not just in fo rm, but in substance so as to resolve this dispute 
once and for all.  According to Article 21.6 of the DSU, the United States was under obligation to provide the DSB with a status report in this dispute "until the issue is resolved ".  Japan reserved all its 
rights under the DSU until the United States came into full compliance with its obligations.  
39. The representative of the European Communities
 said that along the lines as Japan had just 
stated, the EC wanted to recall that on 1 October, the United States had started the distribution of the 
anti-dumping and countervailing duties collected in the latest fiscal year on imports made prior to 
1 October 2007.  This was the eighth distribution under the Continued Dumping and Subsidy Offset 
Act.  Such illegal distributions would continue  for an undetermined number of years as the 
transitional clause preserved the distribution of  duties collected on imports made prior to 
1 October 2007 and such duties were progressively coll ected.  Therefore, the EC wished to ask again 
the United States if and what steps it intended to ta ke to stop the transfer of those anti-dumping and 
countervailing duties to its industry a nd finally to put an end to the condemned measure.  The EC also 
renewed its call on the United States to abide by its  clear obligation under Article 21.6 of the DSU 
and to submit status reports in this dispute. 
40. The representative of Canada  said that his country agreed with the EC and Japan that the Byrd 
Amendment remained subject to the surveillan ce of the DSB until the Un ited States ceased to 
administer it. 
41. The representative of China  said that his country thanked the EC and Japan for, once again, 
raising this item at the DSB meeting.  China sh ared the view expressed by previous speakers and 
wished to join them in urging the United St ates to comply fully with the DSB's rulings. 
                                                      
 3 See the US Customs' publication of the list of the claims by the US domestic producers for FY 2008 
distributions, available at US Customs and Border Protection's website at: 
http://www cbp gov/xp/cgov/tr ade/priority trade/add cvd/coot dump/cdsoa 08/ 
 4 Idem , http://www cbp gov/xp/cgov/trade/priority trade/add cvd/cont dump/cont dump fag.xm1 
  WT/DSB/M/259 
 Page 9 
 
 
  42. The representative of Brazil  said that, as pointed out on several occasions, compliance in this 
dispute would not be achieved until disbursement s under the Byrd Amendment were completely 
stopped, regardless of the period in which the duties had been collected.  Braz il stressed the need for 
the United States to take the necessary actions  in order to fully implement the DSB's 
recommendations and rulings in this dispute. 
43. The representative of Thailand  said that her country thanked the EC and Japan for bringing 
this item before the DSB.  As her delegation had previously stated, Thailand was disappointed at the 
United States' maintenance of these WTO-incons istent disbursements.  Thailand urged the 
United States to cease the disbursements, repeal  the Byrd Amendment with immediate practical 
effect, and resume providing status reports until su ch actions were taken and this matter was fully 
resolved. 
44. The representative of India  said that her country wished to join the previous speakers in 
thanking the EC and Japan for bringing this item befo re the DSB at the present meeting.  India shared 
their concerns.  India wished to state that the di sbursement made by the United States to its domestic 
industry under the Byrd Amendment continued to be in force affecting the rights of other WTO 
Members.  India reiterated that full implementa tion of the DSB's recommendations and rulings had 
not yet been achieved. 
45. The representative of the United States  said that, as his country had already explained at 
previous DSB meetings, the  US President had signed the Defi cit Reduction Act into law on 
8 February 2006.  That Act included a provisio n repealing the Continued Dumping and Subsidy 
Offset Act of 2000.  Thus the United States had ta ken all actions necessary to implement the DSB's 
recommendations and rulings in these disputes.  The United States recalled furthermore that 
Members, including the EC and Japan, had previo usly acknowledged during previous DSB meetings 
that the 2006 Deficit Reduction Act did not permit the distribution of duties collected on goods entered after 1 October 2007.  The United States, therefore, did not understand the purpose for which 
the EC and Japan had inscribed this item on the Agenda of the present meeting.  
46. With respect to comments regarding furt her DSB surveillance on this matter, the 
United States failed to see what purpose would be served by further submission of status reports 
repeating the progress the United States made in th e implementation of the DSB's recommendations 
and rulings.  Finally, the United States had noted in some past meetings that, at this point, it appeared clear that there was a disagreement between several complaining parties and the United States on the meaning and consistency of a US measure  taken to comply.  In this regard, it might be worth  recalling 
the concerns expressed by several Members, including the United States, at the 14 November DSB 
meeting, on the view expressed by the Appellate Bo dy in its recent Hormones reports in relation to 
Article 21.5 of the DSU – specifically, that an or iginal complainant or respondent must initiate 
compliance proceedings without delay once a disa greement arose.  The United States wondered 
whether the eight complaining parties currently authorized to suspend concessions considered 
themselves to be in breach  of their obligations under the DSU by not having initiated Article 21.5 
proceedings.  The United States suspected that they did not.   
47. The representative of the European Communities
 said that, in response to the US comments 
on the Hormones report, as the United States had ri ghtly stated, the Appellate Body had recently 
clarified the DSU as permitting the continuation of san ctions until such time as neither party brought a 
compliance dispute under Article 21.5 of the DSU and this review resulted in the conclusion that the 
implementing Member had indeed achieved WTO compliance.  The United States was welcome to 
bring such a dispute, but the EC understood that the United States might not be eager to do so, as the United States would loose such a dispute unde r the present circumstances of continued non-
implementation.  Furthermore, it might be wo rth quoting again the exact wording of the US 
implementing legislation:  "All duties on entries of goods made and filed before 1 October 2007 ... WT/DSB/M/259 
Page 10  
 
shall be distributed as if Section 754 of the Tariff Ac t of 1930 (that is Byrd Amendment) had not been 
repealed ....". 
48. The representative of the United States
 said that his intervention would be brief.  As his 
country had stated previously, it was clear that  there was a disagreement between the parties. 
49. The DSB took note  of the statements.  
4. Thailand – Customs and fiscal measures on cigarettes from the Philippines  
(a) Request for the establishment of a panel by the Philippines (WT/DS371/3) 
50. The Chairman  recalled that the DSB had considered this matter at its meeting on 
21 October 2008, and had agreed to revert to it.  At  the present meeting he wished to draw attention to 
the communication from the Philippines containe d in document WT/DS371/3, and invited the 
representative of the Philippines to speak. 
51. The representative of the Philippines  said that at the 21 October DSB meeting, the Philippines 
had requested the establishment of a panel to addre ss its concerns with rega rd to certain measures 
imposed by Thailand on imports of cigarettes from the Philippines.  As at that meeting, his delegation 
did not intend to repeat now the claims being made by the Philippines because these were already 
clearly detailed in WT/DS371/3.  He wished to re-state for the record that the Philippines had 
continuously engaged with Thailand in a constructive spirit and with genuine efforts to find a solution 
to their concerns.  The Philippines had noted Tha iland's statement at the 21 October meeting of the 
DSB that it had been working hard to resolve this  dispute on a bilateral basis in the spirit of ASEAN 
cooperation.  It was thus regrettable that bilatera l discussions on the specific matters described in the 
panel request had not yet resulted in a mutually ag reeable solution to the Philippines' concerns, and 
hence, the Philippines was constrained to request  anew at the present meeting that a panel be 
established to examine the matters set forth in the Philippines' panel request with standard terms of 
reference. 
52. The representative of Thailand  said that her country regretted that the Philippines had made 
its second request to establish a panel on this matter.   Thailand maintained its view that as ASEAN 
partners a bilateral solution was the most effective wa y to conclude this matter.  As a result, Thailand 
wished to reiterate that it remained open to fu rther discussions with the Philippines.  Despite its 
disappointment, Thailand acknowledged the establishmen t of the Panel at this time.  Thailand was, 
however, carefully considering whet her the Philippines' panel request satisfied the requirements set 
forth in Article 6.2 of the DSU, particularly as certain issues contained in the Philippines' panel 
request were not contained in its request for consu ltations.  Thailand, therefore, reserved the right to 
bring claims regarding those deficiencies to  the attention of the Panel as necessary. 
53. The DSB took note  of the statements and agreed  to establish a panel in accordance with the 
provisions of Article 6 of the DSU w ith standard terms of reference. 
54. The representatives of Australia , the European Communities , Chinese Taipei  and the 
United States  reserved their third-party rights to participate in the Panel's proceedings.  
5. India – Additional and extra-additional duties on imports from the United States 
(a) Report of the Appellate Body (WT/DS360/AB /R) and Report of the Panel (WT/DS360/R) 
55. The Chairman  drew attention to the communication from the Appellate Body contained in 
document WT/DS360/11 transmitting the Appellate Bo dy Report on:  "India – Additional and Extra-
Additional Duties on Imports from the United States", which had been  circulated on 30 October 2008  WT/DSB/M/259 
 Page 11 
 
 
  in document WT/DS360/AB/R, in accordance w ith Article 17.5 of the DSU.  He reminded 
delegations that the Appellate Body Report and the Panel Report pertaining to this dispute had been 
circulated as unrestricted documents.  As Members were aware, Article 17.14 of the DSU required that:  "An Appellate Body report shall be adopt ed by the DSB and unconditionally accepted by the 
parties to the dispute unless the DSB decides by consensus not to adopt the Appellate Body report 
within 30 days following its circulation to Members.   This adoption procedure is without prejudice to 
the right of Members to express their views on an Appellate Body report".  
56. The representative of the United States
 said that his country was pleased to propose the 
adoption of the Panel and the Appellate Body Report s in this dispute.  The Appellate Body Report 
was a solid, well-reasoned report that had undone a num ber of troubling Panel findings.  In particular, 
the Appellate Body had correctly overturned the Pa nel's finding that Article II:1(b) of the GATT 1994 
only addressed ordinary customs duties and other du ties or charges that inherently discriminated 
against imports.  This finding by the Panel ri sked undermining the fundamental WTO rule that 
Members may not impose ordinary customs duties or other duties or charges on imports in excess of 
tariff commitments.  The Appellate Body had found that there was no textual or other basis for the 
Panel's finding and emphasized that Article II:1(b) covered ordinary customs duties and all duties or 
charges of any kind imposed on or in connection with importation, including those that did not inherently discriminate against imports.  In this regard, the Appellate Body had correctly found that 
tariffs – whether inherently discriminatory or not – were "permissible under Article II:1(b) so long as 
they did not exceed a Member's bound rates".  The Appellate Body's finding had upheld a fundamental WTO rule which was particularly im portant at a time when Members were negotiating 
new tariff commitments. 
57. The Appellate Body had also properly rever sed the Panel's erroneous interpretation of 
Article II:2 of the GATT 1994.  Article II:2(a) pe rmitted charges on imports – in excess of bound 
rates – provided such charges were equivalent to in ternal taxes imposed consistently with Article III:2 
of the GATT 1994.  The Panel had found that a charge  may fall within the scope of Article II:2(a) 
regardless of whether it exceeded the internal taxes to which it was designed to be equivalent.  This 
erroneous interpretation would ha ve allowed Members to impose border charges on imports that 
exceeded both the Member's bound rates and the internal taxes that the duties were designed to offset.  
The Appellate Body was correct to reverse that Pa nel finding and to find that for a charge to be 
justified under Article II:2(a), it must not result in charges on imports that exceeded the internal taxes 
that it was designed to offset. 
58. With respect to the duties at i ssue in this dispute, the Panel's findings were particularly 
troubling because the internal taxes that India ha d claimed the extra-additional duty "offset" (for 
example, state value-added taxes) applied not onl y to domestic products but imported products as 
well.  Moreover, during the proceeding India had acknowledged that the add itional duty may subject 
wine and spirit imports to charges that were higher than the internal taxes imposed on Indian wine and 
spirits.  In light of this evidence, the United Stat es was disappointed that the Appellate Body had not 
completed the analysis to find that the additional an d extra-additional duties in consistent with India's 
WTO obligations, particularly after having corr ectly overturned the Panel's finding that the 
United States had failed to establish that the duties were inconsistent with India's obligations.  The 
Appellate Body's decision not to complete the analys is appeared to be a consequence of the Panel's 
fundamentally flawed legal interpre tations, coupled with India's refusal to identify the internal taxes 
the additional duty allegedly offset, including in r esponse to specific questioning from the Panel about 
them.  The Appellate Body had, however, consid ered that insofar as the additional and extra-
additional duties resulted in charges on imports in excess of internal taxes on like domestic products, 
they would not be justified under Article II:2(a) and,  therefore, would be in consistent with India's 
obligations under Article II:1(b).  Thus, the Appe llate Body's Report provided clear guidance that 
India could not impose the additional and extra-addi tional duties to discriminate against US or other 
imports. WT/DSB/M/259 
Page 12  
 
59. The United States noted that during the course of  the proceedings, India had announced that it 
was withdrawing the additional duty and modifying th e extra-additional duty to provide for a refund 
mechanism.  The United States was pleased with those developments, but still had significant 
concerns about the treatment that India afforded to US imports of wine, spirits and other products.  In 
particular, when India had withdrawn the additiona l duty, it had announced that it was doing so in lieu 
of Indian state taxes on imported wine and spirits.  The EC had already requested WTO consultations 
with respect to its concerns that Indian state taxe s discriminated against wine and spirits imports in 
breach of Article III.  It was very unfortunate that  India had rejected the US request to join those 
consultations. 
60. The United States would be very concerned to find that, just when India had withdrawn the 
additional duty on wine and spirits, its states might  be imposing internal taxes that continued to 
discriminate against US wines and spirits.  The Un ited States believed the guidance in the Appellate 
Body Report was clear:  India could not impose ch arges on imports that exceeded internal taxes on 
like domestic products, and the United States would be watching the situation in India very closely to 
ensure that it did not do so. 
61. The representative India
 said that, at the outset, her country wished to thank the Panel, the 
Appellate Body and the Secretariat and expressed its sincere appreciation for the efforts made by them 
in this matter.  The central issue in this dispute related to the appropriate characterization of two of 
India's duties – the Additional Duty (AD) on alc oholic beverages and the Extra-Additional Duty 
(EAD) levied by India on Identified Products, which were imposed to counter-balance internal taxes 
on like domestic products.  The United States had ar gued before the Panel and the Appellate Body 
that the AD and the EAD were either "ordinary cust oms duties" or "other duties and charges" and, 
under either definition, were inc onsistent with India's obligations  under Article II:1(b) of the GATT 
1994.  India had throughout contended that AD and EAD were charges equivalent to internal charges 
imposed consistently with Article III:2 in respect of  like domestic products and as such, fell within the 
scope of Article II:2(a).  In considering these cl aims, both the Panel and the Appellate Body had 
reaffirmed the existing legal position that under Ar ticle II:2(a), Members were allowed to impose a 
charge on imported products equivalent to intern al taxes on like domestic products. The Appellate 
Body had clearly restated that if a border measure  satisfied the conditions of Article II:2(a), there 
would be no violation of Article II:1(b). 
62. India noted that the Appellate Body had conclude d that the "Panel did not err in considering 
that the United States was required to show that the Additional Duty and Extra-Additional Duty are 
not justified under Article II:2(a)".  The Appellate  Body had essentially reiterated the notion that the 
burden was on the complaining party to show that the measures in question were inconsistent with 
India's GATT obligations.  India welc omed the Reports in this regard. 
63. India wished to state before the DSB certain concerns arising from the language adopted by 
the Appellate Body in paragraph 231(e) and (f) of it s Report.  In response to a request to "complete 
the analysis" with respect to th e United States' claims under Article II:1(b), the Appellate Body had 
made the unusual finding in these paragraphs stating that it considered that India's Additional Duty 
and Extra-Additional Duty would not be justified under Article II:2(a) of GATT 1994 insofar as they 
resulted in the imposition of charges on imports in excess of the excise duties applied on like domestic 
products, and consequently this would render the AD a nd EAD inconsistent with Article II:1(b) to the 
extent that it resulted in the imposition of duties in  excess of those set forth in India's Schedule of 
Concessions.  India failed to understand the basis for this approach by the Appellate Body.  If there 
was inadequate evidence to comple te the analysis, as it was clear in this case, the Appellate Body 
should so conclude and, if it was not able to make findings, it may not issue advisory opinions. 
64. The first sentence of Article II:1(b) prohibited ordinary customs in excess of the Member's 
bound rate.  The second sentence prohibited all othe r duties and charges on bound items not imposed 
under mandatory legislation on the date of this Agr eement, irrespective of whether they entailed an  WT/DSB/M/259 
 Page 13 
 
 
  imposition of duties in excess of those set forth in the Schedule of the Member concerned.  
Consequently, a duty or charge imposed under mandat ory legislation on the date of this Agreement 
may result in an imposition of duties on imports that exceeded the binding; conversely, a duty or charge that was not imposed under mandatory legi slation on the date of this Agreement was 
inconsistent with the second sentence even if it di d not result in an imposition of duties in excess of 
the binding.  The main function of the first sentence of Article II:1(b) was to ensure that ordinary 
customs duties did not exceed the bound rate;  the ma in function of the second sentence was to ensure 
that imports of bound items were not subjected to any additional duties and charges other than those 
required under pre-existing mandatory legislatio n.  A completely different understanding of 
Article II:1(b) was reflected in paragraph 231(e) a nd (f) of the Appellate Body Report, which stated 
that:  "the Extra-Additional Duty would not be  justified under Article II:2(a) of the GATT 1994 
insofar as it results in the imposition of charges on imports in excess of the sales taxes, value-added 
taxes, and other local taxes or charges that India a lleges are equivalent to the Extra-Additional Duty;  
and, consequently, that this would render the Extra-Additional Du ty inconsistent with Article II:1(b) 
to the extent that it results in the imposition of duties in excess of those set forth in India's Schedule of 
Concession." (emphasis added). 
65. As drafted, this paragraph implied that Article  II:1(b) prohibited other duties and charges only 
to the extent that that they did not exceed th e bound rates set forth in a Member's Schedule of 
Concessions.  It also suggested that the bound rat es set a ceiling on the level of other duties and 
charges that Members were permitted to impose.  I ndia noted that there was no reasoning in either 
Report to suggest that either the Panel or the Appe llate Body intended to interpret the second sentence 
of Article II:1(b) in this manner.  Against th is background, paragraph 231(e) and (f) may be 
considered to be an inadvertent misstatement ra ther than a considered ruling.  India urged the 
Appellate Body and future panels not to base th eir rulings on Article II:1(b) on the statement in 
paragraph 231(e) and (f) and invited Members not  to conclude from this statement that their 
obligations under Article II:1(b) had changed. 
66. Finally, India appreciated that neither the Pane l nor the Appellate Body had found that India 
had acted inconsistently with its obligations un der the GATT 1994.  As the Panel Report made clear, 
since this dispute had begun, India had made change s to some of the measures at issue to address the 
concerns of its trading partners.  Her delegation wished to emphasize that India, as a responsible 
Member of the WTO, was fully aware of its ri ghts and obligations under the WTO Agreements and 
reiterated its commitment to addressing any concerns  of its trading partners relating to how India 
fulfilled those obligations. 
67. The representative of th e European Communities
 said that, as the United States had pointed 
out, the EC had a broader interest in this disput e, as it had also brought a challenge against the 
Additional Duty and the Extra-Additional Duty, and had now entered into cons ultations with India on 
measures at state level.  The EC was grateful to th e Appellate Body and its Secretariat for their work 
and for having reversed the Pane l's controversial findings on Article II of the GATT 1994.  The EC 
particularly welcomed the fact that the Appellate  Body had reassessed the Panel's restrictive finding 
on the term "equivalent" and broadened it to include  also a qualitative comparison of the relevant 
border charge with the corresponding internal tax.  The EC also welcomed the clarification on the 
burden of proof in such challenges, but regretted India's lack of cooperation in providing the Panel 
with facts.  The EC remained convinced that the Additional Duty and the Extra-Additional Duty were 
WTO-incompatible for the reasons explained by the Appellate Body, and welcomed India's wise 
decision to stop applying them. 
68. The representative of Chile  said that, as a third party in this  dispute, his country wished to 
thank the Appellate Body and the Secretariat for th e Report to be adopted at the present meeting.  
Chile welcomed the Appellate Body Report, inasmuch  as it had rectified the errors committed by the 
Panel with regard to the interpretation of Articles II:1(b) and II:2(a) of the GATT 1994.  As was well-WT/DSB/M/259 
Page 14  
 
known, Article II of the GATT contained one of the basic obligations of the law of the WTO and of 
the multilateral system and, therefore, the introduction of erroneous  views regarding the 
characterization of the fees and charges that Member s applied may give rise to serious obstacles in the 
correct application of that obligation.  The Appellate  Body had correctly reaffirmed the principle that 
tariffs were legitimate instruments for attaining certa in objectives of trade policy or of another policy, 
such as the generation of tax income, and that they  were the preferred instrument of trade policy, 
while quantitative restrictions were prohibited in principle.  Whatever may be the objective they 
sought, tariffs were permitted under Article II:1(b) so long as they did not exceed the bound rates of 
the Member in question.  In short, their character ization as intrinsically discriminatory duties was not 
supported. 
69. Similarly, with regard to Article II:2, the Appe llate Body had rectified the Panel's conclusion 
that the fees and charges mentioned in that paragra ph were not discriminatory, a situation that was not 
consistent with the nature of the countervailing duties, anti-dumping duties and the charges imposed 
exclusively on imports, as listed in that paragraph of Article II.  As for the interpretation of the terms 
"equivalent" and "consistently w ith the provisions of paragraph 2 of Article III", contained in 
Article II:2, Chile believed the Appella te Body's approach to be correct , in that both concepts must be 
interpreted jointly.  The determination of whet her a charge was applied consistently with the 
provisions of paragraph 2 of Article III necessarily en tailed the comparison of a border charge with an 
internal tax so as to determine whet her the former exceeded the latter. 
70. With regard to the burden of proof, in its anal ysis the Appellate Body had partially rectified 
the Panel's errors in laying the responsibility fo r providing proof on the complaining party, which 
could give rise to serious problems for the application of the provisions of Article II when the 
provisions of paragraph 2(a) of that Article were invoked as a defe nce.  Chile would have liked a 
more conclusive ruling by the Appellate Body in  this connection, but welcomed the spirit of 
cooperation and good faith between the parties, wh ich was behind its analysis.  Finally, Chile 
expressed its satisfaction at the Appellate Body's findings that the additional and extra-additional 
customs duties applied by India were incompatible  with the relevant provisions of the GATT 1994. 
71. The representative of India
 said that her delegation wished to make a comment with respect to 
the assertions made by the United States and the EC to the effect that I ndia had not cooperated 
throughout the proceedings.  All these issues had b een thoroughly considered and examined by the 
Appellate Body, and the Appellate Body had  made it very  clear that the there was a prima facie  a 
burden of proof on the  complaining Member to establish that the  allegations made by India did not 
fall under Article II:2(a) of the GATT 1994. 
72. The DSB took note  of the statements, and adopted  the Appellate Body Report contained in 
WT/DS360/AB/R and the Panel Repo rt contained in WT/DS360/R, as reversed by the Appellate 
Body Report. 
6. Adoption of the 2008 draft Annual Report of the DSB (WT/DSB/W/389 and Add.1) 
73. The Chairman  said that, in pursuance of the procedures for an annual overview of WTO 
activities and for reporting under the WTO contained in document WT/L/105, he was submitting for 
adoption the draft text of the 2008 Annual Report of the DSB contained in document WT/DSB/W/389 
and Add.1.  This report covered the work of the DSB since the previous Annual Report contained in 
document WT/DSB/43 and Add.1.  For practical purposes, the overview of the state of play of WTO disputes covering the period from 1 January 1995 to 31 October 2008, prepared by the Secretariat on 
its own responsibility, was included in the addendum  to this report.  He proposed that after the 
adoption of the Annual Report at the present meeting, the Secretariat be authorized to update this 
Report under its own responsibility in  order to include actions taken by the DSB at the present 
meeting as well as the actions taken at the special  DSB meeting held on 14 November.  The updated  WT/DSB/M/259 
 Page 15 
 
 
  Annual Report of the DSB would then be submitted for consideration by the General Council at its 
meeting to be held on 18 and 19 December. 
74. The DSB took note  of the statement and adopted  the draft Annual Report of the DSB 
contained in WT/DSB/W/389 and Add.1 on the unders tanding that it would be further updated by the 
Secretariat.5 
7. Proposed nomination for the indicative list of governmental and non-governmental 
panelists (WT/DSB/W/391) 
75. The Chairman  drew attention to document WT/DSB/W /391, which contained an additional 
name proposed for inclusion on the indicative list of  governmental and non-governmental panelists, in 
accordance with Article 8.4 of the DSU.  He propo sed that the DSB approve the name contained in 
document WT/DSB/W/391. 
 The DSB so agreed . 
 
__________  
                                                      
5 The Annual Report was subsequently circulated in document WT/DSB/47 and Add.1.