WT/DS27/RW/USA 
 Page A-1 
 
 
  ANNEX A 
 
Contents Page 
Annex A-1 Request for the Establis hment of a Panel (WT/DS27/83) A-2 
Annex A-2 Working procedures for th e Panel, dated 22 August 2007 A-5 
 
 WT/DS27/RW/USA 
Page A-2  
 
  ANNEX A-1 
 
REQUEST FOR THE ESTABLISHMENT OF A PANEL 
 
 
 
WORLD TRADE  
ORGANIZATION  WT/DS27/83 
2 July 2007 
 (07-2829) 
 Original:   English 
 
  
EUROPEAN COMMUNITIES – REGIME FOR THE IMPORTATION, 
SALE AND DISTRIBUTION OF BANANAS 
 
Recourse to Article 21.5 of the DSU by the United States
 
 
Request for the Establishment of a Panel 
 
 
 The following communication, dated 29 June 2007, from the delegation of the United States 
to the Chairman of the Dispute Settlement Body, is  circulated pursuant to Article 21.5 of the DSU. 
 
_______________ 
  
On 25 September 1997, the Dispute Settlement Body ("DSB") adopted its recommendations 
and rulings in the dispute European Communities – Regime for the Importation, Sale and Distribution 
of Bananas (WT/DS27) (" Bananas III ").
1  The DSB ruled that the import regime of the European 
Communities ("EC") for bananas was inconsis tent with the EC's obligations under the General 
Agreement on Tariffs and Trade 1994  ("GATT 1994") and General Agreement on Trade in Services  
("GATS").  Accordingly, the DSB recommended that the EC bring its measure into conformity with 
those agreements.2  An arbitrator appointed under Article 21.3(c) of the Understanding on Rules and 
Procedures Governing the Settlement of Disputes  ("DSU") awarded the EC a "reasonable period of 
time" until 1 January 1999, to do so.3 
 
The EC failed to bring its import regime for bananas into compliance with its WTO 
obligations by the end of the reasonable period of  time, and the United States considers that the 
regime remains inconsistent today, nearly a decade after the DSB made its original recommendations and rulings.  In particular, at the end of the reas onable period of time, the EC implemented a first set 
                                                     
 
1 Dispute Settlement Body, Minutes of 25 September 1997 Meeting, WT/DSB/M/37 (circulated 
4 November 1997). 
2 See Dispute Settlement Body, Minutes of 25 September 1997 Meeting, WT/DSB/M/37 (circulated 
4 November 1997); European Communities – Regime for the Importation, Sale and Distribution of Bananas , 
WT/DS27/R/USA, para. 9.2 (22 May 1997); European Communities – Regime for the Importation, Sale and 
Distribution of Bananas , WT/DS27/AB/R, para. 257 (9 September 1997). 
3 European Communities – Regime for the Importation, Sale and Distribution of Bananas , 
WT/DS27/15, para. 20 (7 January 1998).  WT/DS27/RW/USA 
 Page A-3 
 
 
  of changes to the banana import regime – through Regulation (EC) No. 1637/984 and Regulation (EC) 
No. 2362/985 – that were found to perpetuate a discr iminatory tariff-rate quota ("TRQ") system and 
license-based system in breach of the GATT 1994 and the GATS.6 
 In November 1999, the EC announced a second atte mpt to reform its banana regime, which 
was allegedly to comprise "a two-stage process, namely, after a transitional period during which a 
tariff quota system would be applied with preferential access for ACP [(African, Caribbean and Pacific)] countries, a flat tariff would be introduced."
7  The "transitional period" was to end no later 
than January 1, 2006.    
Although the United States reluctantly permitted this lengthy delay in compliance until the 
end of the "transitional period,"
8 the EC never performed the second of the steps in the "two-stage 
process."  Instead of adopting a "flat tariff" fo r bananas, on 29 November 2005, the EC adopted 
Regulation (EC) No. 1964/2005, which establishes a preferential (zero-duty) TRQ available only to bananas originating in African, Caribbean and Pacific ("ACP") countries.
9  Bananas of other origins 
have no access to this 775,000 ton TRQ.  Under Regulation (EC) No. 1964/2005 such other bananas 
are subject instead to a duty of 176 euros/ton.10  The regulation took effect as of 1 January 2006. 
 
The United States considers that the EC has failed to implement the DSB's recommendations 
and rulings, including through the changes made to its  banana regime on 1 January 2006.  Therefore, 
the regime remains inconsistent with the EC's  WTO obligations.  The United States considers, 
inter alia , that the EC's banana import regime: 
 
(1) is inconsistent with Article I of the GATT 1994 because it applies a zero tariff rate to 
imports of bananas originating in ACP count ries in a quantity up to 775,000 tons but 
does not accord the same duty-free treatment to  imports of bananas originating in all 
other WTO Members; and 
 
(2) is inconsistent with Article XIII of the GATT 1994 – including Articles XIII:1 and 
XIII:2 – because it reserves the 775,000 t on zero-duty TRQ for imports of bananas 
originating in ACP countries and provid es no access to this preferential TRQ to 
                                                      
4 Published in the Official Journal of the European Communities (OJEC) L 120 of 28 July 1998. 
5 Published in the Official Journal of the European Communities (OJEC) L 293/32 of 31 October 1998. 
6 These findings were made by both a panel established under Article 21.5 of the DSU at the request of 
Ecuador as well as by an arbitrator appointed pursuant to Article 22.6 of the DSU to review a US request for 
authorization to suspend concessions.  See European Communities – Regime for the Importation, Sale and 
Distribution of Bananas , WT/DS27/RW/ECU, paras. 6.160-6.163 (12 April 1999) and European Communities – 
Regime for the Importation, Sale and Distribution of Bananas , WT/DS27/ARB, paras. 5.96-5.98 (9 April 1999), 
respectively.  The DSB adopted the report of the Article 21.5 panel on 6 May 1999, including, again, a recommendation that the EC bring its banana import regime into conformity with its obligations under the 
GATT 1994 and the GATS.  See Dispute Settlement Body, Minutes of 6 May 1999 Meeting, WT/DSB/M/61 
(circulated 30 June 1999) and European Communities – Regime for the Importation, Sale and Distribution of 
Bananas , WT/DS27/RW/ECU, para. 7.2. 
7 Minutes of Meeting of the Dispute Settlement Body held on 19 November 1999, WT/DSB/M/71 
(11 January 2000). 
8 In April 2001, the EC memorialized its "two stage" compliance proposal in separate understandings 
with the United States and Ecuador. 
9 Regulation (EC) No. 1964/2005, para. 2, published in the Official Journal of the European 
Communities (OJEC) L 316/1 of 12 December 2005 ("[e]ach  year from 1 January, starting from 1 January 2006, 
an autonomous tariff quota of 775 000 tonnes net weight subject to a zero-duty rate shall be opened for imports 
of bananas (CN code 0803 00 19) originating in ACP countries.") 
10 Regulation (EC) No. 1964/2005, para. 1, published in the Official Journal of the European 
Communities (OJEC) L 316/1 of 12 December 2005. WT/DS27/RW/USA 
Page A-4  
 
  imports of bananas originating in non-ACP substantial or non-s ubstantial supplying 
countries. 
 
The United States understands the measures th rough which the EC maintains its current 
import regime for bananas to include: 
 
• Regulation (EEC) 404/93 of 13 February 1993, as amended by Regulation 
(EC) 216/2001 of 29 January 2001; 
 
• Regulation (EC) No. 1964/2005 of 29 November 2005; and 
 
• for each of the regulations listed above,  any amendments, implementing measures, 
and other related measures. 
 
As there is "disagreement as to the existence or consistency with a covered agreement of 
measures taken to comply with the recommendati ons and rulings" of the DSB between the United 
States and the EC, the United States respectfully seek s recourse to Article 21.5 of the DSU in this 
matter.  The United States requests that the DSB refe r the matter to the original panel, if possible, 
pursuant to Article 21.5 of the DSU. 
 
  WT/DS27/RW/USA 
 Page A-5 
 
 
  ANNEX A-2 
 
WORKING PROCEDURES FOR THE PANEL 
DATED 22 AUGUST 2007  
  
1. In its proceedings the Panel shall follow the relevant provisions of the Dispute Settlement 
Understanding (DSU).  In addition, the following Working Procedures shall apply. 
2. The Panel will provide the Parties
1 and Third Parties2 with a timetable for its proceedings.  
The timetable may be modified by the Panel as a ppropriate, after having consulted the Parties. 
3. The Panel shall meet in closed session.  The Par ties, and interested Third Parties, shall be 
present at the meetings only when invited by the Panel to appear before it.  Provided satisfactory 
logistical arrangements can be ensured by the Secret ariat, the substantive meeting of the Panel with 
the Parties may be open for observation by the p ublic through closed-circuit broadcast.  At any 
moment including during such meeting, any Party may request the Panel to suspend the broadcasting 
for as long as necessary in order to protect confidentia l information.  The Panel may also decide on its 
own to suspend the broadcasting at any time. 
4. The deliberations of the Panel and the documents  submitted to it shall be kept confidential.  
Nothing in the DSU, nor in these Working Pro cedures, precludes a Party or a Third Party from 
disclosing statements of its own positions to the public.  Parties and Third Parties shall treat as 
confidential information submitted by another Party or Third Party to the Panel that the latter Party or 
Third Party has designated as confidential.  As pr ovided in Article 18.2 of the DSU, where a Party 
submits a confidential version of its written submissi ons to the Panel, it shall also, upon request of the 
other Party, provide a non-confidential summary of th e information contained in its submissions that 
could be disclosed to the public. Non-confidential summaries  shall be normally submitted no later than 
one week after the written submission is presented to the Panel, unless a different deadline is granted by 
the Panel upon a showing of good cause. 
5. Before the substantive meeting of the Panel with the Parties, and in accordance with the 
timetable approved by the Panel, the Parties shall transmit to the Panel written submissions and subsequently written rebuttals in which they presen t the facts of the case, their arguments and their 
counter-arguments, respectively.  Third Parties may transmit to the Panel written submissions after the 
rebuttals of the Parties have been submitted, and in accordance with the timetable approved by the 
Panel. 
6. All Third Parties shall be invited in writing to present their views during the substantive meeting 
of the Panel with the Parties and the Third Parties.  Third Parties may be present during the entirety of 
that meeting. 
7. At its substantive meeting with the Parties, th e Panel shall ask the United States to present its 
case first.  Subsequently, and still at the same m eeting, the European Commu nities will be asked to 
present its arguments.  At the same meeting, Thir d Parties will be asked to present their views 
thereafter.  Parties will then be allowed an opportu nity for final statements, with the United States 
presenting its statement first. 
                                                     
 
1 Throughout this document, the term "Party" refers to either the United States or the European 
Communities, as appropriate.  The term "Parties" refers to both the United States and the European 
Communities. 
2 Throughout the document, the term "Third Parties" refers to Belize, Brazil, Cameroon, Colombia, 
Côte d'Ivoire, the Dominican Republic, Ecuador, Jamaica, Japan, Mexico, Nicaragua, Panama and Suriname. WT/DS27/RW/USA 
Page A-6  
 
  8. The Panel may decide to hold meetings with the Parties jointly with the Panel in the case of 
European Communities – Regime for the Importation,  Sale and Distribution of Bananas (Recourse to 
Article 21.5 of the DSU by Ecuador) .  In that case, the order in which Members will be asked to make 
their statements will be decided by the Panel. 
9. The Panel may at any time put questions to the Parties and to the Third Parties and ask them 
for explanations either in the course of the substan tive meeting or afterwards in writing.  Replies to 
questions shall be submitted in writing by the dates specified by the Panel after consultation with the 
Parties.  In addition, the Parties shall be permitted to  ask questions to each other and to Third Parties.  
Third Parties may ask oral questions to the Parti es during the course of the substantive meeting, in 
accordance with the rules a dopted by the Panel, but Parties are under no obligation to respond to those 
questions. 
10. Each Party shall make available to the Panel and to the other Party a written version of its oral 
statements no later than on the first working day foll owing the date of the end of the meeting at which 
the oral statement was presented.  Any Third Party that wishes to present its views shall similarly 
make available to the Panel and to the Parties and other Third Parties a written version of its oral 
statements no later than on the first working day foll owing the date of the end of the meeting at which 
the oral statement was presented.  Parties and Third Parties shall provide the Panel and other participants at the respective session with a provision al written version of their oral statements before 
these statements are made. 
11. In the interests of full transparency, oral pr esentations shall be made in the presence of the 
Parties.  Moreover, each Party's written submissions, including replies to questions put by the Panel, 
shall be made available to the other Party.  Thir d Parties shall receive copies of the Parties' first 
written submissions and rebuttals as well as copies of  the questions posed by the Panel to the Parties 
and to the other Third Parties and copies of Parties' and Third Parties' responses to such questions.  
Parties shall submit all factual evidence to the Pane l as early as possible and no later than during the 
substantive meeting, except with respect to evid ence necessary for the answering of questions.  
Exceptions will be granted by the Panel upon a showi ng of good cause.  In such cases, the other Party 
shall be accorded a period of time for commenting, as appropriate. 
12. Within seven (7) calendar days following the submission of a written submission or 
presentation of an oral statement to the Panel, th e Parties shall provide the Panel with an executive 
summary of the submission or statement.  Each summary to be provided by each Party shall not exceed ten (10) pages in length.  Third Parties shall also submit an ex ecutive summary seven (7) 
calendar days after delivering their written submissi on or oral statement.  Third Parties' executive 
summaries shall not exceed three (3) pages in le ngth.  The Panel may, in light of further 
developments, allow the Parties and Third Parti es to submit longer summar ies.  These executive 
summaries will be used by the Panel only for the pur pose of drafting a concise factual and arguments 
section of the Panel Report so as to facilitate timely translation and circulation of the Panel report to 
the Members.  The Panel reserves the right to ed it any executive summaries that exceed the page 
limits indicated above.  Executive summaries shall in  no way serve as a substitute for the submissions 
of the parties. 
13. To facilitate the maintenance of the record of  the dispute, and to maximize the clarity of 
submissions, in particular the refe rences to exhibits submitted by Pa rties, Parties shall sequentially 
number their exhibits throughout the course of the di spute.  For example, exhibits submitted by the 
United States should be numbered US-1, US-2, etc.  If the last exhibit in connection with the first 
submission was numbered US-5, the first exhibit of the next submission thus should be numbered US-
6.  Exhibits submitted by the European Comm unities should be numbered EC-1, EC-2, etc.  WT/DS27/RW/USA 
 Page A-7 
 
 
  14. The Parties and Third Parties to  this proceeding have the right to determine the composition 
of their own delegations.  Delega tions may include as representatives of the government concerned, 
private counsel and advisers.  The Parties and Thir d Parties shall have responsibility for all members 
of their delegation and shall ensure that all member s of their delegation, as well as any other advisers 
consulted by a Party or Third Party, act in acco rdance with the rules of the DSU and the Working 
Procedures of this Panel, particularly in regard to  the confidentiality of the proceedings.  Parties shall 
provide a list of the participants of their delegation to the Secretary of the Panel and to each other no 
later than 5.00 pm, local Geneva time, the wo rking day before any meeting with the Panel. 
15. The Panel reserves the right to earmark its co mmunications to enable the identification of 
possible breaches of confidentiality, especially the Pane l's interim report and its final report before the 
latter's circulation to all Members. 
16. Any request for a preliminary ruling (including rulings on jurisdictional issues) to be made by 
the Panel shall be submitted no later than in a Pa rty's first written submission.  If the United States 
requests any such ruling, the European Communities sh all submit its response to such a request in its 
first written submission.  If the European Communi ties requests any such ru ling, the United States 
shall submit its response to such a request in its re buttal submission.  Exceptions to this procedure will 
be granted upon a showing of good cause.  The Panel shall inform the Parties promptly of any preliminary rulings it might make in the course of the proceedings.  In addition, the Panel may also 
choose to inform third parties of such preliminary rulings, if it deems it relevan
t. 
17. The following procedures regarding service of documents shall apply: 
(a) Each Party shall serve its submissions directly on the other Party.  Each Party shall, in 
addition, serve its first written submissi on, rebuttals, and its responses to the 
questions by the Panel and by the other Party on Third Parties.  Each Third Party shall 
serve its submissions on the Parties and othe r Third Parties.  Each Party and Third 
Party shall confirm in writing, at the time it provides the submission to the Secretariat, that copies have been served as required. 
(b) In the light of the particular circumstances of this case, the Panel may decide to copy, 
as appropriate, the complainant in the case of European Communities – Regime for 
the Importation, Sale and Distribution of Bananas (Recourse to Article 21.5 of the 
DSU by Ecuador)  on communications directed to the Parties. 
(c) The Parties and Third Parties shall provide  their written submissions to the Panel, 
through the Secretariat, by 5.00 p.m., loca l Geneva time, on the deadlines established 
by the Panel. 
(d) Parties and Third Parties shall provide the Secretariat with written copies of their oral 
statements no later than on the first working day following the date of the meeting at which the oral statement was presented. 
(e) The Parties and Third Parties shall provide th e Secretariat with ten (10) paper copies 
of all their submissions as well as an "electronic" copy on a CD-ROM, diskette or as 
an e-mail attachment, in a format compatible  with the Secretariat's software.  Paper 
copies shall be delivered to the Disput e Settlement Registrar, ****** (Room 2150).  
Electronic copies should be sent by e-mail to ***** at DSregistry@wto.org
;  ***** 
at *****@wto.org;  ***** at *****@wto.org;  ***** at *****@wto.org;  and ***** at *****@wto.org. WT/DS27/RW/USA 
Page A-8  
 
  (f) The Panel will provide Parties with an electronic version of the descriptive sections of 
its draft report, the interim report and the final report, as well as of other documents, 
as appropriate.  When the Panel transmits to  the Parties or Third Parties both paper 
and electronic versions of a document, the paper version shall constitute the official 
version for the purposes of the record of the dispute. 
18. These Working Procedures may be modified by the Panel as appropriate, after having 
consulted the Parties. 
 
  WT/DS27/RW/USA 
 Page B-1 
 
 
  ANNEX B 
 
Contents Page 
Annex B-1 Notification of a Mutually Agreed Solution (WT/DS27/58) B-2 
Annex B-2 Communication from the United States (WT/DS27/59) B-10 
Annex B-3 Understanding on Ba nanas between Ecuador and the EC (WT/DS27/60) B-14 
Annex B-4 The ACP-EC Partnership Ag reement, Decision of 14 November 2001 
(WT/MIN(01)/15) B-20 
Annex B-5 Transitional Regime for the EC Autonomous Tariff Rate Quotas on 
Imports of Bananas, Decision of  14 November 2001 (WT/MIN(01)/16) B-24 
 WT/DS27/RW/USA 
Page B-2  
 
  ANNEX B-1 
 
NOTIFICATION OF A MUTUALLY AGREED SOLUTION 
 
 
 
WORLD TRADE  
ORGANIZATION  WT/DS27/58 
2 July 2001 
 (01-3276) 
 Original:   English 
 
  
EUROPEAN COMMUNITIES – REGIME FOR THE IMPORTATION, 
SALE AND DISTRIBUTION OF BANANAS 
 
Notification of Mutually Agreed Solution
 
  
 The following communication, dated 22 June 2001, from the Permanent Delegation of the European Commission to the Chairman of the Dis pute Settlement Body, is circulated pursuant to 
Article 3.6 of the DSU. 
 
_______________ 
 
 
 The European Communities (EC) wish to notify the Dispute Settlement Body (DSB) that they 
have reached, with the United States of America and Ecuador, a mutually satisfactory solution within 
the meaning of Article 3.6 of the DSU regarding the implementation by the EC of the conclusions and recommendations adopted by the DS B in the dispute "Regime for the importation, sale and distribution 
of bananas" (WT/DS27).    
 Please find attached the text of the Understandings reached between the EC and the United 
States and between the EC and Ecuador, resp ectively on 11 April 2001 and 30 April 2001, which 
constitute a mutually agreed solution to the bananas dispute.   I would be grateful if you could circulate a copy  of this letter with its enclosures to the WTO 
Members.   WT/DS27/RW/USA 
 Page B-3 
 
 
  Enclosure 1:  Understanding on Bananas between the EC and the United States of 11 April 2001  
 
 A. The European Commission and the United St ates have identified the means by which the 
long-standing dispute over the EC’s bana na import regime can be resolved. 
 
B. In accordance with Article 16(1) of Regul ation No. (EC) 404/93 (as amended by Regulation 
No. (EC) 216/2001), the European Communities (E C) will introduce a Tariff Only regime for 
imports of bananas no later than 1 January 2006. 
 
C. In the interim, the EC will implement an impor t regime on the basis of historical licensing as 
follows : 
  1. Effective 1 July 2001, the EC will im plement an import regime on the basis of 
historical licensing as set out in Annex 1. 
 
 2. Effective as soon as possible thereafter, subject to Council and European Parliament 
approval and to adoption of the Article XIII wa iver referred to in paragraph E, the EC 
will implement an import regime on the basis of historical licensing as set out in Annex 2.  The Commission will seek to obtain the implementation of such an import regime as soon as possible. 
 
D. With respect to the United  States' imposition of increased duties applied to certain EC 
products as of 19 April 1999 covering trade in an  amount of US$191.4 million per year (the 
"increased duties"): 
 
 1. Upon implementation of the import re gime described in paragraph C(1), the 
United States will provisionally suspen d its imposition of the increased duties. 
  2. Upon implementation of the import re gime described in paragraph C(2), the 
United States will terminate its imposition of the increased duties. 
 
 3. The United States may reimpose the increased duties if the import regime described 
in paragraph C(2) does not enter into force by 1 January 2002. 
 E. The United States will lift its reserve concer ning the waiver of Article I of the GATT 1994 
that the EC has requested for preferential access to  the EC of goods originating in ACP states 
signatory to the Cotonou Agreement; and will actively work towards promoting the 
acceptance of an EC request for a waiver of  Article XIII of the GATT 1994 needed for the 
management of quota C under the import regi me described in paragraph C(2) until 
31 December 2005. 
 F. The EC and the United States have informed  Ecuador and will cooperate in seeking the 
agreement of all parties. WT/DS27/RW/USA 
Page B-4  
 
  Annex I
 
 
Phase I  
  
1. A bound tariff-rate quota (TRQ) designated as quota "A" will be set at 2,200,000 tonnes.  An 
autonomous TRQ designated as quota "B" will be set  at 353,000 tonnes.  These TRQs will be 
managed as one, with the total quota being 2, 553,000 tonnes.  There is no expectation of 
allocation of shares of either of these TRQs  among country suppliers, and the Commission 
will not seek to convene a meeting to that effect of the principal supplying countries except 
upon the joint request of all such countries.  The tariff applied to bana nas imported in the "A" 
and "B" quotas shall not exceed 75 euro/tonne. 
 2. A TRQ designated as quota "C" will be set at 850,000 tonnes.  
3. Import licenses for 83% of the "A" and "B" TRQs will be distributed to "traditional" operators 
based on each qualified "traditional" operato r's 1994-96 average annual final reference 
volume ("reference volume") for the "A/B" quotas.  Qualified "traditional" operators will be 
identified on the basis of the distribution of licenses that occurred under Regulation 404, 
Article 19.1(a) and Regulation 1442, Article 3.1(a) for "Category A subfunction (a)".  
Importers will not need to produce new evidence. 
 
4. Licenses for TRQ "C" are intended to be distri buted broadly in accordance with the principles 
to be utilized in managing of licenses for TRQ's "A" and "B" and on the basis of imports of ACP-origin bananas.  The European Commissi on and the United States will consult again 
within 4 weeks with a view to finaliz ing the licensing principles for TRQ "C". 
 
5. Within each TRQ, licenses may be used to  import bananas from any source.  Licenses to 
import bananas into TRQ "C" cannot be used to  import bananas into TRQs "A" or "B", and 
vice versa. 
 6. A "non-traditional" operator category will be cr eated with respect to 17% of the quantity of 
the "A and B" TRQs.  Non-traditional operato rs cannot become traditional operators in 
subsequent periods.  Management of non-trad itional imports will be  done by simultaneous 
examination. 
 7. The licensing regime will be administered in good faith and on a non-discriminatory basis. 
 
8. The Commission will provide the United St ates as soon as possible the verified statistics 
confirming the implementation of this phase, taking into account the protection of business 
confidential information. 
  WT/DS27/RW/USA 
 Page B-5 
 
 
  Annex II  
 
Phase II  
  
1. During Phase II, the provisions applying to Phase I will continue, excep t as provided in this 
Annex. 
 2. In Phase II, TRQ "B" will be 453,000 tonnes (an increase of 100,000 tonnes).  The total for 
the "A" and "B" TRQs will be 2,653,000 tonnes. 
 
3. The TRQ "C" will be 750,000 tonnes and w ill be reserved for bananas of ACP origin. 
 4. The share of import licenses to "traditional"  operators for the "A" and "B" TRQs will be 
allocated in accordance with th e procedure in Annex I.  Import licenses will be distributed 
based on each qualified "traditional" opera tor's 1994-96 refere nce volume through 
31 December 2003.  Thereafter, the share of im port licenses to "traditional" operators for the 
"A" and "B" TRQs will be allocated based only on usage of licenses issued under Phase II of 
this Understanding, through credible documentation. 
 5. The Commission will provide the United St ates as soon as possible the verified statistics 
confirming the implementation of this phase, taking into account the protection of business 
confidential information. 
 WT/DS27/RW/USA 
Page B-6  
 
  Enclosure 2:  Understanding on Bananas between the EC and Ecuador of 30 April 2001
 
 
 A. The European Commission and Ecuador ha ve identified the means by which the long-
standing dispute over the EC’s banana import regime can be resolved. 
 
B. In accordance with Article 16(1) of Regul ation No. (EC) 404/93 (as amended by Regulation 
No. (EC) 216/2001), the European Communities (E C) will introduce a Tariff Only regime for 
imports of bananas no later than 1 January 2006.  GATT Art XXVIII negotiations shall be 
initiated in good time to that effect, recogni zing Ecuador as the principal supplier in these 
negotiations. 
 C. In the interim, the EC will implement an impor t regime on the basis of historical licensing as 
follows : 
 
 1. Effective 1 July 2001, the EC will im plement an import regime on the basis of 
historical licensing as set out in Annex 1. 
  2. Effective as soon as possible thereafter, subject to Council and European Parliament 
approval and to adoption of the Article XIII wa iver referred to in paragraph F, the EC 
will implement an import regime on the basis of historical licensing as set out in 
Annex 2. The Commission will seek to obtain the implementation of such an import 
regime as soon as possible. 
 D. Ecuador takes note that the European Commi ssion will examine the trade in organic bananas 
and report accordingly by 31 December 2004. 
 
E. Upon implementation of the import regime d escribed in paragraph C, Ecuador's right to 
suspend concessions or other obligations of a level not exceeding US$201.6 million per year 
vis-à-vis the EC will be terminated. 
 F. Ecuador will lift its reserve concerning the wa iver of Article I of the GATT 1994 that the EC 
has requested for preferential access to the EC of  goods originating in ACP states signatory to 
the Cotonou Agreement; and will actively work towards promoting the acceptance of an EC 
request for a waiver of Article XIII of the GATT 1994 needed for the management of quota C 
under the import regime described in pa ragraph C(2) until 31 December 2005. 
 
G. The EC and Ecuador consider that this U nderstanding constitutes a mutually agreed solution 
to the banana dispute.  WT/DS27/RW/USA 
 Page B-7 
 
 
  Annex I  
 
Phase I  
  
1. A bound tariff-rate quota (TRQ) designated as quota "A" will be set at 2,200,000 tonnes.  An 
autonomous TRQ designated as quota "B" will be set  at 353,000 tonnes.  These TRQs will be 
managed as one, with the total quota being 2, 553,000 tonnes.  There is no expectation of 
allocation of shares of either of these TRQs  among country suppliers, and the Commission 
will not seek to convene a meeting to that effect of the principal supplying countries except 
upon the joint request of all such countries.  The tariff applied to bana nas imported in the "A" 
and "B" quotas shall not exceed 75 euro/tonne. 
 2. A TRQ designated as quota "C" will be set at 850,000 tonnes.  
3. Import licenses for 83% of the "A" and "B" TRQs will be distributed to "traditional" operators 
based on each qualified "traditional" operato r’s 1994-96 average final reference volume 
("reference volume") for the "A/B" quotas. Qualif ied "traditional" operators will be identified 
on the basis of the distribution of licenses that  occurred under Regulati on 404, Article 19.1(a) 
and Regulation 1442, Article 3.1(a) for "Cate gory A subfunction (a)". Importers will not need 
to produce new evidence. 
 
4. Licenses for TRQ "C" are intended to be distri buted broadly in accordance with the principles 
to be utilized in managing of licenses for TRQ’ s "A" and "B" and on the basis of imports of 
ACP-origin bananas.  
 
5. Within each TRQ, licenses may be used to  import bananas from any source. Licenses to 
import bananas into TRQ "C" cannot be used to import bananas into TRQs "A" and "B", and 
vice versa. 
 6. A "non-traditional" operator category will be cr eated with respect to 17% of the quantity of 
the "A and B" TRQs.  Non-traditional operato rs cannot become traditional operators in 
subsequent periods. 
 7. Management of non-traditi onal operators will be done by  simultaneous examination, 
respecting the following conditions: 
 
 (a) the activity period to consider for registration shall be 2 years; 
  (b) the minimum annual customs value of imports into the EU to qualify shall be 
1.2 million € ; 
  (c) traditional importers in Quota C may only qualify as non-traditional importers in 
Quota A/B when they prove that they im ported bananas from third countries other 
than ACP in the relevant period; 
  (d) in application for licenses, the maxi mum requested quantities for each non-traditional 
operator shall be not higher than 12.5% of the quantity reserved for non-traditional 
operators; 
  (e) a security of 150€/t shall be required;  WT/DS27/RW/USA 
Page B-8  
 
   (f) a non-traditional operator shall be required to  be responsible for shipping bananas to 
the EU; 
  (g) simultaneous examination shall be  conducted in a pro-rata basis; 
 
 (h) dissuasive penalties shall apply in the ev ent that a traditional operator be found to be 
controlling a non-traditional operator within the same Quota; 
  (i) transmissibility of licenses between non-traditional operators will be permitted.  
8. The licensing regime will be administered in good faith and on a non-discriminatory basis.  WT/DS27/RW/USA 
 Page B-9 
 
 
  Annex II  
 
Phase II  
  
1. During Phase II, the provisions applying to Phase I will continue, excep t as provided in this 
Annex. 
 2. In Phase II, TRQ "B" will be 453,000 tonnes (an increase of 100,000 tonnes).  The total for 
the "A" and "B" TRQs will be 2,653,000 tonnes. 
 
3. The TRQ "C" will be 750,000 tonnes and w ill be reserved for bananas of ACP origin. 
 4. The share of import licenses to "traditional"  operators for the "A" and "B" TRQs will be 
allocated in accordance with th e procedure in Annex I. Import licenses will be distributed 
based on each qualified "traditional" opera tor's 1994-96 refere nce volume through 
31 December 2003.  Thereafter, the share of im port licenses to "traditional" operators for the 
"A" and "B" TRQs will be allocated based only on usage of licenses issued under Phase II of 
this Understanding, through credible documentation. 
 5. The Commission will provide regularly the ve rified statistics on the importation of bananas 
from Ecuador. 
 WT/DS27/RW/USA 
Page B-10  
 
  ANNEX B-2 
 
COMMUNICATION FROM THE UNITED STATES 
 
 
 
 
WORLD TRADE  
ORGANIZATION  WT/DS27/59 
G/C/W/270 
2 July 2001 
 (01-3275) 
 Original:   English 
   
EUROPEAN COMMUNITIES – REGIME FOR THE IMPORTATION, 
SALE AND DISTRIBUTION OF BANANAS 
 
Communication from the United States
 
  
 The following communication, dated 26 June 2001, from the Permanent Mission of the 
United States to the Chairman of the Dispute Settlem ent Body, is circulated at the request of that 
delegation.  
_______________ 
  
 For the information of all Members, please find attached the text of the Understanding reached between the European  Communities (EC) and the United States on 11 April 2001. 
  We have received and reviewed the EC's separat e notification of 22 June 2001, to the Dispute 
Settlement Body (DSB) of our Understanding on bana nas.  As we have explained to the EC during 
bilateral discussions last week and indicated at m eetings of the DSB, the Understanding identifies the 
means by which the long-standing dispute over the EC 's banana import regime can be resolved, but, 
as is obvious from its own text, it does not in itself constitute a mutually agreed solution pursuant to 
Article 3.6 of the DSU.  In addition, in view of the steps yet to be taken by all parties, it would also be 
premature to take this item off the DSB agenda. 
 
 The United States very much looks forward to the prospect of a resolution to this 
long-standing dispute, and we will of course conti nue to be pleased to consult with the Commission 
and other interested parties as the EC proceeds w ith implementing its regulations in accordance with 
the Understanding.  WT/DS27/RW/USA 
 Page B-11 
 
 
  Understanding on Bananas  
 
 A. The European Commission and the United St ates have identified the means by which the 
long-standing dispute over the EC’s bana na import regime can be resolved. 
 
B. In accordance with Article 16(1) of Regul ation No. (EC) 404/93 (as amended by Regulation 
No. (EC) 216/2001), the European Communities (E C) will introduce a Tariff Only regime for 
imports of bananas no later than 1 January 2006. 
 
C. In the interim, the EC will implement an impor t regime on the basis of historical licensing as 
follows : 
  1. Effective 1 July 2001, the EC will im plement an import regime on the basis of 
historical licensing as set out in Annex 1. 
 
 2. Effective as soon as possible thereafter, subject to Council and European Parliament 
approval and to adoption of the Article XIII wa iver referred to in paragraph E, the EC 
will implement an import regime on the basis of historical licensing as set out in Annex 2.  The Commission will seek to obtain the implementation of such an import regime as soon as possible. 
 
D. With respect to the United  States' imposition of increased duties applied to certain EC 
products as of 19 April 1999 covering trade in an  amount of US$191.4 million per year (the 
"increased duties"): 
 
 1. Upon implementation of the import re gime described in paragraph C(1), the 
United States will provisionally suspen d its imposition of the increased duties. 
  2. Upon implementation of the import re gime described in paragraph C(2), the 
United States will terminate its imposition of the increased duties. 
 
 3. The United States may reimpose the increased duties if the import regime described 
in paragraph C(2) does not enter into force by 1 January 2002. 
 E. The United States will lift its reserve concer ning the waiver of Article I of the GATT 1994 
that the EC has requested for preferential access to  the EC of goods originating in ACP states 
signatory to the Cotonou Agreement; and will actively work towards promoting the 
acceptance of an EC request for a waiver of  Article XIII of the GATT 1994 needed for the 
management of quota C under the import regi me described in paragraph C(2) until 
31 December 2005. 
 F. The EC and the United States have informed  Ecuador and will cooperate in seeking the 
agreement of all parties. WT/DS27/RW/USA 
Page B-12  
 
  Annex I
 
 
Phase I  
  
1. A bound tariff-rate quota (TRQ) designated as quota "A" will be set at 2,200,000 tonnes.  An 
autonomous TRQ designated as quota "B" will be set  at 353,000 tonnes.  These TRQs will be 
managed as one, with the total quota being 2, 553,000 tonnes.  There is no expectation of 
allocation of shares of either of these TRQs  among country suppliers, and the Commission 
will not seek to convene a meeting to that effect of the principal supplying countries except 
upon the joint request of all such countries.  The tariff applied to bana nas imported in the "A" 
and "B" quotas shall not exceed 75 euro/tonne. 
 2. A TRQ designated as quota "C" will be set at 850,000 tonnes.  
3. Import licenses for 83% of the "A" and "B" TRQs will be distributed to "traditional" operators 
based on each qualified "traditional" operato r's 1994-96 average annual final reference 
volume ("reference volume") for the "A/B" quotas.  Qualified "traditional" operators will be 
identified on the basis of the distribution of licenses that occurred under Regulation 404, 
Article 19.1(a) and Regulation 1442, Article 3.1(a) for "Category A subfunction (a)".  
Importers will not need to produce new evidence. 
 
4. Licenses for TRQ "C" are intended to be distri buted broadly in accordance with the principles 
to be utilized in managing of licenses for TRQ's "A" and "B" and on the basis of imports of ACP-origin bananas.  The European Commissi on and the United States will consult again 
within 4 weeks with a view to finaliz ing the licensing principles for TRQ "C". 
 
5. Within each TRQ, licenses may be used to  import bananas from any source.  Licenses to 
import bananas into TRQ "C" cannot be used to  import bananas into TRQs "A" or "B", and 
vice versa. 
 6. A "non-traditional" operator category will be cr eated with respect to 17% of the quantity of 
the "A and B" TRQs.  Non-traditional operato rs cannot become traditional operators in 
subsequent periods.  Management of non-trad itional imports will be  done by simultaneous 
examination. 
 7. The licensing regime will be administered in good faith and on a non-discriminatory basis. 
 
8. The Commission will provide the United St ates as soon as possible the verified statistics 
confirming the implementation of this phase, taking into account the protection of business 
confidential information. 
  WT/DS27/RW/USA 
 Page B-13 
 
 
  Annex II  
 
Phase II  
  
1. During Phase II, the provisions applying to Phase I will continue, excep t as provided in this 
Annex. 
 2. In Phase II, TRQ "B" will be 453,000 tonnes (an increase of 100,000 tonnes).  The total for 
the "A" and "B" TRQs will be 2,653,000 tonnes. 
 
3. The TRQ "C" will be 750,000 tonnes and w ill be reserved for bananas of ACP origin. 
 4. The share of import licenses to "traditional"  operators for the "A" and "B" TRQs will be 
allocated in accordance with th e procedure in Annex I.  Import licenses will be distributed 
based on each qualified "traditional" opera tor's 1994-96 refere nce volume through 
31 December 2003.  Thereafter, the share of im port licenses to "traditional" operators for the 
"A" and "B" TRQs will be allocated based only on usage of licenses issued under Phase II of 
this Understanding, through credible documentation. 
 5. The Commission will provide the United St ates as soon as possible the verified statistics 
confirming the implementation of this phase, taking into account the protection of business 
confidential information. 
  WT/DS27/RW/USA 
Page B-14  
 
  ANNEX B-3 
 
UNDERSTANDING ON BANANAS 
BETWEEN ECUADOR AND THE EC 
  
 
WORLD TRADE  
ORGANIZATION  WT/DS27/60 
G/C/W/274 
9 July 2001 
 (01-3398) 
 Original:   English 
   
EUROPEAN COMMUNITIES - REGIME FOR THE IMPORTATION, 
SALE AND DISTRIBUTION OF BANANAS 
 
Understanding on Bananas be tween Ecuador and the EC
 
  
 The following communication, dated 3 July 2001, from the Permanent Mission of Ecuador to 
the Chairman of the Dispute Settlement Body, is circulated at the request of that delegation. 
 
_______________ 
 
 
 For the information of all WTO members, please find attached the text of the Understanding 
on Bananas reached by Ecuador and the European Communities on 30 April 2001. 
 
After a careful analysis on how best to presen t this Understanding to the membership of the 
Organization, having reviewed the separate notifica tion made unilaterally by the EC on 22 June 2001 
(WT/DS27/58), and bearing in mind the subsequent  discussions maintained with the EC after the 
Understanding was reached, Ecuador considers it ne cessary to put forward the following comments 
for the Members' consideration.  1. The Understanding identifies means by which a long-standing dispute can be resolved. 
However, the Understanding also comprises of  the execution of two phases and requires the 
implementation of several key features, which demands the collective action of the WTO 
membership. As Ecuador has expressed during th e last two meetings of the DSB, it will 
remain vigilant that these phases and elemen ts be fully implemented and executed. 
 2. Once the EC has amended its banana im port regime - which was found to be WTO 
inconsistent by the original panel that revi ewed the case as a result of Ecuador's recourse to 
Article 21.5 of the DSU (WT/DS27/RW/ECU)  - Ecuador notes that the Understanding 
reached with the EC refers to the current banana  import regime in force as of 1 July 2001 as 
one of a transitory nature since, beginning at the latest on 1 January 2006, a new and definitive Tariff Only regime will be in force. 
 3. Since the new EC banana import regime which is currently in force still requires that several 
steps be taken in the context of the DSB and ot her WTO bodies, it would be premature to take  WT/DS27/RW/USA 
 Page B-15 
 
 
  this item off the DSB agenda which considers th is issue at every regular meeting pursuant to 
Article 21.6 of the DSU. 
 
In light of the above and although Ecuador sees the Understanding as an agreed solution 
which can contribute to an overall, definite and uni versally accepted solution, it must be made clear 
that the provisions of Article 3.6 of the DSU are not applicable in this case. 
 
We request that you please circulate a copy of this letter with its attachment to all WTO 
Members and request that the Secretariat provide a copy of these documents to the Council of Trade 
in Goods. 
 WT/DS27/RW/USA 
Page B-16  
 
  Understanding on Bananas
 
 
 
A. The European Commission and Ecuador ha ve identified the means by which the long-
standing dispute over the EC’s banana import regime can be resolved. 
 
B. In accordance with Article 16(1) of Regul ation No. (EC) 404\93 (as amended by Regulation 
No. (EC) 216\2001), the European Communities (EC) will introduce a Tariff Only regime for imports 
of bananas no later than 1 January 2006.  GATT Art XXVIII negotiations sh all be initiated in good 
time to that effect, recognizing Ecuador as the principal supplier in these negotiations. 
 
C. In the interim, the EC will implement an impor t regime on the basis of historical licensing as 
follows :  
1. Effective 1 July 2001, the EC will impl ement an import regime on the basis of 
historical licensing as set out in Annex 1. 
 
2. Effective as soon as possible thereafter, subj ect to Council and European Parliament 
approval and to adoption of the Article XIII wa iver referred to in paragraph F, the EC 
will implement an import regime on the basis of historical licensing as set out in Annex 2. The Commission will seek to obtain the implementation of such an import 
regime as soon as possible. 
 D. Ecuador takes note that the European Commi ssion will examine the trade in organic bananas 
and report accordingly by 31 December 2004.  
E. Upon implementation of the import regime de scribed in paragraph C, Ecuador’s right to 
suspend concessions or other obligations of a leve l not exceeding US$201.6 million per year vis-à-vis 
the EC will be terminated.  F. Ecuador will lift its reserve concerning the wa iver of Article I of the GATT 1994 that the EC 
has requested for preferential access to the EC of goods originating in ACP States signatory to the 
Cotonou Agreement; and will actively work towards pr omoting the acceptance of an EC request for a 
waiver of Article XIII of the GATT 1994 needed for the management of quota C under the import regime described in paragra ph C(2) until 31 December 2005. 
 G. The EC and Ecuador consider that this U nderstanding constitutes a mutually agreed solution 
to the banana dispute.  WT/DS27/RW/USA 
 Page B-17 
 
 
  Annex I 
 
Phase I  
 
 
1. A bound tariff-rate quota (TRQ) designated as quota "A" will be set at 2,200,000 tonnes. An 
autonomous TRQ designated as quota "B" will be  set at 353,000 tonnes. These TRQs will be 
managed as one, with the total quota being 2,553,000 tonnes. There is no expectation of allocation of 
shares of either of these TRQs among country supp liers, and the Commission will not seek to convene 
a meeting to that effect of the principal supplying  countries except upon the joint request of all such 
countries. The tariff applied to bananas importe d in the "A" and "B" quotas shall not exceed 
75 euro/tonne.  2. A TRQ designated as quota “C” will be set at 850,000 tonnes.  
3. Import licenses for 83% of the "A" and "B" TRQs will be distributed to "traditional" operators 
based on each qualified "traditional" operator’s 19 94-96 average final reference volume ("reference 
volume") for the “A/B” quotas. Qualified “traditional” operators will be identified on the basis of the 
distribution of licenses that occurred under Regula tion 404, Article 19.1(a)  and Regulation 1442, 
Article 3.1(a) for “Category A subfunction (a)”. Im porters will not need to produce new evidence. 
 
4. Licenses for TRQ “C” are intended to be distri buted broadly in accordance with the principles 
to be utilized in managing of licenses for TRQs "A " and "B" and on the basis of imports of ACP-
origin bananas.   5. Within each TRQ, licenses may be used to  import bananas from any source. Licenses to 
import bananas into TRQ "C" cannot be used to import bananas into TRQs "A" and "B", and vice 
versa.  6. A "non-traditional" operator category will be cr eated with respect to 17% of the quantity of 
the “A and B” TRQs. Non-traditional operators ca nnot become traditional operators in subsequent 
periods. 
 
7. Management of non-traditi onal operators will be done by  simultaneous examination, 
respecting the following conditions:   (a) the activity period to consider for registration shall be 2 years; 
 
 (b) the minimum annual customs value of imports into the EU to qualify shall be 
1.2 million € ; 
 
(c) traditional importers in Quota C may on ly qualify as non-traditional importers in 
Quota A/B when they prove that they im ported bananas from third countries other 
than ACP in the relevant period; 
 (d) in application for licenses, the maxi mum requested quantities for each non-traditional 
operator shall be not higher than 12.5% of the quantity reserved for non-traditional 
operators; 
 
 (e) a security of 150€/t shall be required;  
(f)  a non-traditional operator shall be required to  be responsible for shipping bananas to 
the EU; WT/DS27/RW/USA 
Page B-18  
 
   
 (g) simultaneous examination shall be  conducted in a pro-rata basis; 
 
(h) dissuasive penalties shall apply in the even t that a traditional operator be found to be 
controlling a non-traditional operator within the same Quota; 
 
 (i) transmissibility of licenses between non-traditional operators will be permitted.  8. The licensing regime will be administered in good faith and on a non-discriminatory basis. 
  WT/DS27/RW/USA 
 Page B-19 
 
 
  Annex II 
 
Phase II  
  
1. During Phase II, the provisions applying to Phase I will continue, excep t as provided in this 
Annex.  2. In Phase II, TRQ "B" will be 453,000 tonnes (a n increase of 100,000 tonnes). The total for the 
"A" and "B" TRQs will be 2,653,000 tonnes. 
 
3. The TRQ "C" will be 750,000 tonnes and w ill be reserved for bananas of ACP origin. 
 4. The share of import licenses to "traditional"  operators for the "A" and "B" TRQs will be 
allocated in accordance wi th the procedure in Annex I. Import licenses will be distributed based on 
each qualified "traditional" operator’s 1994-96 re ference volume through December 31, 2003. 
Thereafter, the share of import licenses to "traditi onal" operators for the "A" and "B" TRQs will be 
allocated based only on usage of licenses issued  under Phase II of this Understanding, through 
credible documentation.  5. The Commission will provide regularly the ve rified statistics on the importation of bananas 
from Ecuador. 
 WT/DS27/RW/USA 
Page B-20  
 
  ANNEX B-4 
 
THE ACP-EC PARTNERSHIP AGREEMENT 
DECISION OF 14 NOVEMBER 2001 
  
 
WORLD TRADE  
ORGANIZATION  WT/MIN(01)/15 
14 November 2001 
 (01-5786) 
MINISTERIAL CONFERENCE 
Fourth Session Doha, 9 - 14 November 2001  
 
 
 
 
EUROPEAN COMMUNITIES – THE ACP-EC PARTNERSHIP AGREEMENT 
 
 
Decision of 14 November 2001
 
 
  The Ministerial Conference,   Having regard  to paragraphs 1 and 3 of Article IX of the Marrakech Agreement Establishing 
the World Trade Organisation (the "WTO Agreemen t"), the Guiding Principles to be followed in 
considering applications for waivers adopted on 1 November 1956 (BISD 5S/25), the Understanding 
in Respect to Waivers of Obligations under th e General Agreement on Tariffs and Trade 1994, 
paragraph 3 of Article IX of the WTO Agreem ent, and Decision-Making Procedures under Articles 
IX and XII of the WTO Agreement agreed by the General Council (WT/L/93);  
 Taking note of the request of the European Communiti es (EC) and of the Governments of the 
ACP States which are also WTO members (hereinaft er also the “Parties to the Agreement”) for a 
waiver from the obligations of the European Co mmunities under paragraph 1 of Article I of the 
General Agreement with respect to the granting of preferential tariff  treatment for products originating 
in ACP States as required by Article 36.3, Annex V and its Protocols of the ACP-EC Partnership 
Agreement (hereinafter also referred to as “the Agreement”)
1; 
  Considering  that, in the field of trade, the provisions of the ACP-EC Partnership Agreement 
requires preferential tariff  treatment by the EC of exports of pr oducts originating in the ACP States; 
 
 Considering  that the Agreement is aimed at impr oving the standard of living and economic 
development of the ACP States, including the least developed among them;   Considering  also that the preferential tariff  treatment for products originating in ACP States 
as required by Article 36.3, Annex V and its Protoc ols of the Agreement is designed to promote the 
expansion of trade and economic development of beneficiaries in  a manner consistent with the 
                                                     
 
1 As contained in documents G/C/W/187, G/C/W/204, G/C/W/254 and G/C/W/269).  WT/DS27/RW/USA 
 Page B-21 
 
 
  objectives of the WTO and with the trade, financia l and development needs of the beneficiaries and 
not to raise undue barriers or to create undue difficulties for the trade of other members;   Considering  that the Agreement establishes a prep aratory period extending until 31 December 
2007, by the end of which new trading arrangements shall be concluded between the Parties to the 
Agreement; 
  Considering  that the trade provisions of the Agreem ent have been applied since 1 March 2000 
on the basis of transitional measures adopted by the ACP-EC joint institutions;  
 Noting  the assurances given by the Parties to the Agreement that they will, upon request, 
promptly enter into consultations with any interest ed member with respect to any difficulty or matter 
that may arise as a result of the implementation of the preferential tariff  treatment for products 
originating in ACP States as required by Article 36.3, Annex V and its Protocols of the Agreement; 
 
 Noting  that the tariff applied to bananas importe d in the "A" and "B" quotas shall not exceed 
75 €/tonne until the entry into force of the new EC tariff-only regime.   Noting  that the implementation of the preferential tariff treatment for bananas may be affected 
as a result of GATT Article XXVIII negotiations; 
 
 Noting  the assurances from the Parties to the Agre ement that any re-binding of the EC tariff 
on bananas under the relevant GATT Article XXVIII pr ocedures should result in at least maintaining 
total market access for MFN banana suppliers a nd their willingness to accept a multilateral control on 
the implementation of this commitment.  
 Considering that, in light of the foregoing, the ex ceptional circumstances justifying a waiver 
from paragraph 1 of Article I of  the General Agreement exist; 
  Decides  as follows: 
 1. Subject to the terms and conditions set out he reunder, Article I, para graph 1 of the General 
Agreement shall be waived, until 31 December  2007, to the extent necessary to permit the 
European Communities to provide preferential tariff  treatment for products originating in 
ACP States as required by Article 36.3, Annex V and its Protocols of the ACP-EC Partnership 
Agreement,
2 without being required to extend the same preferential treatment to like products 
of any other member.  
 
2. The Parties to the Agreement sha ll promptly notify the General Council  of any changes in the 
preferential tariff  treatment to products originating in ACP States as required by the relevant 
provisions of the Agreement covered by this waiver.  
 
3. The Parties to the Agreement will, upon request , promptly enter into consultations with any 
interested member with respect to any difficu lty or matter that may arise as a result of the 
implementation of the preferential tariff  treatment for products originating in ACP States as 
required by Article 36.3, Annex V and its Pr otocols of the Agreement; where a member 
considers that any benefit accruing to it under the General Agreement may be or is being 
impaired unduly as a result of such implementa tion, such consultations shall examine the 
possibility of action  for a satisfactory adjustment of the matter. 
                                                      
2 Any reference to the Partnership Agreement in th is Decision shall also in clude the period during 
which the trade provisions of this Agreement are applie d on the basis of transitional measures adopted by the 
ACP-EC joint institutions. WT/DS27/RW/USA 
Page B-22  
 
  3bis With respect to bananas, the additional provisions in the Annex shall apply.  
 4. Any member which considers that the preferential tariff  treatment for products originating in 
ACP States as required by Article 36.3, Annex V and its Protocols of the Agreement is being 
applied inconsistently with this waiver or that any benefit accruing to it under the General 
Agreement may be or is being impaired undul y as a result of the implementation of the 
preferential tariff treatment for products origin ating in ACP States as required by Article 36.3, 
Annex V and its Protocols of the Agreemen t and that consultations have proved 
unsatisfactory, may bring the ma tter before the General Council , which will examine it 
promptly and will formulate any recommendations that they judge appropriate. 
 
5. The Parties to the Agreement will submit to  the General Council an annual report on the 
implementation of the preferential tariff  treatment for products originating in ACP States as 
required by Article 36.3, Annex V a nd its Protocols of the Agreement. 
 
6. This waiver shall not preclude the right of affected members to have recourse to 
Articles XXII and XXIII of the General Agreement. 
 
  WT/DS27/RW/USA 
 Page B-23 
 
 
  ANNEX 
  
 The waiver would apply for ACP produc ts under the Cotonou Agreement until 
31 December 2007.  In the case of bananas, th e waiver will also apply until 31 December 2007, 
subject to the following, which is without prejudi ce to rights and obligations  under Article XXVIII. 
 - The parties to the Cotonou Agreement will in itiate consultations with Members exporting to 
the EU on a MFN basis (interested parties)  early enough to finalize the process of 
consultations under the procedures hereby establishe d at least three months before the entry 
into force of the new EC tariff only regime. 
 - No later than 10 days after the conclusion of  Article XXVIII negotiations, interested parties 
will be informed of the EC intentions concerni ng the rebinding of the EC  tariff on bananas.  
In the course of such consultations, the EC will provide information on the methodology used 
for such rebinding.  In this regard, all EC  WTO market-access commitments relating to 
bananas should be taken into account. 
 - Within 60 days of such an announcement, any such interested party may request arbitration. 
 - The arbitrator shall be appointed within 10 days, following the request subject to agreement 
between the two parties, failing which the arbitrator shall be appointed by the Director-
General of the WTO, following consultations wi th the parties, within 30 days of the 
arbitration request.  The mandate of the arbitrator  shall be to determine, within 90 days of his 
appointment, whether the envisaged rebinding of the EC tariff on bananas would result in at 
least maintaining total market access for MF N banana suppliers, ta king into account the 
above-mentioned EC commitments. 
 - If the arbitrator determines that the rebinding  would not result in at least maintaining total 
market access for MFN suppliers, the EC shall rectify the matter.  Within 10 days of the 
notification of the arbitration award to th e General Council, the EC will enter into 
consultations with those interested parties that requested the arbitration.  In the absence of a 
mutually satisfactory solution, the same arbitrat or will be asked to determine, within 30 days 
of the new arbitration request, whether the EC has rectified the matter.  The second arbitration 
award will be notified to the General Council.  If the EC has failed to rectify the matter, this 
waiver shall cease to apply to bananas upon entry into force of the new EC tariff regime.  The 
Article XXVIII negotiations and the arbitration procedures shall be concluded before the 
entry into force of the new EC tariff only regime on 1 January 2006. 
 WT/DS27/RW/USA 
Page B-24  
 
  ANNEX B-5 
 
TRANSITIONAL REGIME FOR THE EC AUTONOMOUS 
TARIFF RATE QUOTAS ON IMPORTS OF BANANAS 
DECISION OF 14 NOVEMBER 2001 
 
 
 
WORLD TRADE  
ORGANIZATION  WT/MIN(01)/16 
14 November 2001 
 (01-5787) 
MINISTERIAL CONFERENCE 
Fourth Session Doha, 9 – 14 November 2001  
 
 
 
EUROPEAN COMMUNITIES – TRANSITIONAL REGIME FOR THE EC 
AUTONOMOUS TARIFF RATE QUOTAS ON IMPORTS OF BANANAS 
 
Decision of 14 November 2001
 
 
 
The Ministerial Conference,  
 
Having  regard  to the Guiding Principles to be followed in considering applications for 
waivers adopted on 1 November 1956, the Understa nding in Respect of Waivers of Obligations under 
the General Agreement on Tariffs and Trade 1994, and paragraphs 3 and 4 of Article IX of the 
Marrakesh Agreement Establishing the World Trade Organization (hereinafter "WTO Agreement"); 
 
Taking note  of the request of the European Comm unities for a waiver from its obligations 
under paragraphs 1 and 2 of Article XIII of the GATT 1994 with respect to bananas; 
 
Taking note  of the understandings reached by the EC , Ecuador and the United States that  
identify the means by which the longstanding dispute over the EC’s banana regi me can be resolved, in 
particular their provision for a temporary global quota allocation for ACP banana supplying countries 
under specified conditions; 
 
Taking into account  the exceptional circumstances surr ounding the resolution of the bananas 
dispute and the interests of many WTO Members in the EC banana regime;  
 
Recognizing the need to afford sufficient protecti on to the ACP banana supplying countries, 
including the most vulnerable, during a limited transi tion period, to enable them to prepare for a tariff-
only regime; 
 
Noting  assurances given by the EC that it will, upon request, promptly enter into consultations 
with any interested member with respect to any diff iculty or matter that may arise as a result of the 
implementation of the tariff rate quota for bananas originating in ACP States; 
  WT/DS27/RW/USA 
 Page B-25 
 
 
  Considering that, in light of the foregoing, the ex ceptional circumstances justifying a waiver 
from paragraphs 1 and 2 of Article XIII  of the GATT 1994 with respect to bananas exist; 
 
Decides  as follows: 
 
1. With respect to the EC’s imports of bananas, as of 1 January 2002, and until 
31 December 2005, paragraphs 1 and 2 of Article XIII of the GATT 1994 are waived with 
respect to the EC’s separate tariff quota of 750,000 tonnes for bananas of ACP origin. 
 2. The EC will, upon request, promptly enter into consultations with any in terested member with 
respect to any difficulty or matter that may arise as a result of the implementation of the 
separate tariff rate quota for bananas originati ng in ACP States covered by this waiver; where 
a Member considers that any benefit accruing to it under the GATT 1994 may be or is being 
impaired unduly as a result of such implementa tion, such consultations shall examine the 
possibility of action  for a satisfactory adjustment of the matter. 
 
3. Any Member which considers that the separat e tariff rate quota for bananas originating in 
ACP States covered by this waiver is being applie d inconsistently with this waiver or that any 
benefit accruing to it under the GATT 1994 may be or is being impaired unduly as a result of 
the implementation of the separate tariff rate quota for bananas originating in ACP States 
covered by this waiver and that consultati ons have proved unsatisfactory, may bring the 
matter before the General Council, which will examine it promptly and will formulate any 
recommendations that they judge appropriate. 
 4. This waiver shall not preclude the right of affected members to have recourse to Articles XXII 
and XXIII of the GATT 1994. 
  WT/DS27/RW/USA 
 Page C-1 
 
 
  ANNEX C 
 
Contents Page 
Annex C-1 Article XXIV:6 – Negotiations, En largement of the European Union:  
Communication from the European  Communities (G/SECRET/20), 
30 January 2004 C-2 
Annex C-2 Article XXIV:6 – Negotiations, En largement of the European Union:  
Communication from the European  Communities (G/SECRET/26), 
28 September 2006 C-4 
 
 WT/DS27/RW/USA 
Page C-2  
 
  ANNEX C-1 
 
ARTICLE XXIV:6 NEGOTIATIONS 
ENLARGEMENT OF THE EUROPEAN UNION 
COMMUNICATION FROM THE EUROPEAN COMMUNITIES 
 
 
No. _________________  
WORLD TRADE  
ORGANIZATION  G/SECRET/20 
30 January 2004 
 (04-0350) 
  
 Original:   English 
 
 
ARTICLE XXIV:6 NEGOTIATIONS 
 
Enlargement of the European Union  
 
Communication from the European Communities 
 
  The following communication, dated 19 January 2 004, is being circulated at the request of the 
Delegation of the European Communities.  
_______________ 
Notification  
by the European Communities to  
the World Trade Organization and its Members 
concerning decisions to enter into a customs union, resulting from the 
 
Enlargement of the European Union 
 
 
by the accession of 
 
 The Czech Republic, the Republic of Estonia, th e Republic of Cyprus, the Republic of Latvia, 
the Republic of Lithuania, the Republic of Hungary , the Republic of Malta, the Republic of Poland, 
the Republic of Slovenia and the Slovak Republic;   Pursuant to the Understanding on the Interpretation of Article XXIV GATT 1994, 
paragraph 4, incorporating the Guidelines adopted on 10 November 1980 (BISD 27S/26-28), 
paragraph 1 (the "Guidelines"). 
  Following, inter alia , the decision of 14 April 2003 of the Council of the European Union on 
the admission to the European Union of the Czech Re public, the Republic of  Estonia, the Republic of 
Cyprus, the Republic of Latvia, the Republic of Li thuania, the Republic of Hungary, the Republic of 
Malta, the Republic of Poland, the Republic of Slovenia and the Slovak Republic and pending the 
finalisation of ratification procedures, the Europ ean Communities have the honour to notify the WTO 
and its Members that these states have decided to become members of the European Union on  WT/DS27/RW/USA 
 Page C-3 
 
 
  1 May 2004.  The Treaty of Accession is published in the Official Journal of the European Union  
L 236 of 23 September 2003.  A version subj ect to a legal disclaimer is published at: 
http://europa.eu.int/comm/enlargement/ne gotiations/treaty_of_accession_2003/index.htm. 
  Accordingly, the European Communities hereby notifies, within the framework of procedures 
laid down in Article XXIV GATT 1994, and in partic ular paragraph 6 thereof, the withdrawal on 
1 May 2004 of the commitments in Schedule XC II Czech Republic, Schedule CXLIV Republic of 
Estonia, Schedule CVII Republic of Cyprus, Sc hedule CXLIII Republic of Latvia, Schedule CL 
Republic of Lithuania, Schedule LXXI Republic of Hungary, Schedule CXVII Republic of Malta, 
Schedule LXV Republic of Poland, Schedul e XCVI Republic of Slovenia, Schedule  XCIII Slovak 
Republic and Schedule CXL
1 of the European Communities of 15. 
  The European Communities is  ready to enter into Artic le XXIV and XXVIII GATT 1994 
procedures including tariff negotia tions or consultations to address compensatory adjustments 
provided for under Article XXIV.6 GATT 1994. 
 
 The data
2 necessary for the purposes of applying Article XXIV.6 GATT 1994, as provided for 
in the Guidelines, paragraph 2, first and second  sentences, is included in the Annex of this 
notification.  In accordance with the Guidelines, pa ragraph 2, third sentence,  and paragraph 3, any 
proposed modifications or compensatory adjustments will be circulated and communicated separately.  
 
 The EC intends to communicate further data in  the near future to members having negotiation 
rights.   Pending the completion of the Article XXI V and XXVIII GATT 1994 procedures and the 
creation of a new schedule valid for the Europ ean Communities of 25, the commitments in the 
European Communities Schedule CXL will be fully respected.  The new members of the European 
Union intend to align their Schedules with those of the European Communities on 1 May 2004.   Pursuant to the Guidelines, paragraph 1, the European Communities transmits this notification 
to the Secretariat, and requests the Secretariat to di stribute this notification to all other Members in a 
secret document. 
 
 The above-mentioned data are available in electronic form only  on the WTO Members' 
Homepage (http://members.wto.org), go to WTO Resources
, then Market Access Schedules on Goods  
(login), and then to Other .  Download the zipped database and open using MS Access, choose your 
country to print the applicable data.  
 
_______________ 
 
 
                                                      
1 This schedule is a total of the tariff and ot her commitments of the European Communities of 15 
circulated under cover of WTO document G/L/65/Rev.1 of 19 March 1996.  It has subsequently been modified 
by G/MA/TAR/RS/16 of 2 April 1997 (certified WT/Let/156), G/MA/TAR/RS/30 of 13 May 1997 (certified WT/Let/178), G/L/65/Rev.1/Add.2 of 21 October 1997, G/MA/TAR/RS/47 of 10 February 1998 (certified 
WT/Let/261), G/L/65/Rev.1/Add.2/Corr.1 of 10 February 1998, G/L/65/Rev.1/Add.3 of 23 November 1998, 
G/L/65/Rev.1/Add.4 of 1 July 1999, and G/L/65/Rev.1/Add.5 of 22 February 2000. 
2 Please see the bottom of the page for more info rmation on how to obtain the data.  The data are 
available in English only.  WT/DS27/RW/USA 
Page C-4  
 
  ANNEX C-2 
 
ARTICLE XXIV:6 NEGOTIATIONS 
ENLARGEMENT OF THE EUROPEAN UNION 
COMMUNICATION FROM THE EUROPEAN COMMUNITIES 
 
 
No. _________________ 
WORLD TRADE  
ORGANIZATION  G/SECRET/26 
28 September 2006 
 (06-4638) 
 Original:   English 
   
ARTICLE XXIV:6 NEGOTIATIONS 
 
Enlargement of the European Union
 
 
Communication from the European Communities 
  
 The following communication, dated 27 September 2006, has been received from the delegation of the European Communities.  
_______________ 
 
Notification  
by the European Communities to  
the World Trade Organization and its Members 
concerning decisions to enter into a customs union, resulting from the 
 
Enlargement of the European Union 
 
 
by the accession of 
 
the Republic of Bulgaria and Romania; 
 
  Pursuant to the Understanding on the Interpretation of Article XXIV GATT 1994, 
paragraph 4, incorporating the Guidelines adopted on 10 November 1980 (BISD 27S/26-28), 
paragraph 1 (the “Guidelines”). 
 
 Following, inter alia , the decision of 25 April 2005 of the Council of the European Union on 
the admission to the European Union of the Republic of Bulgaria and Romania and pending the 
finalisation of ratification procedures, leading to the entry into force of the Treaty of Accession, the 
European Communities have the ho nour to notify the WTO and its Members that these states have  WT/DS27/RW/USA 
 Page C-5 
 
 
  decided to become members of the European Un ion on 1 January 2007. The Treaty of Accession is 
published in the Official Journal of the European Union  L 157 of 21 June 2005.1 
  Accordingly, the European Communities hereby notifies, within the framework of procedures 
laid down in Article XXIV GATT 1994, and in particular paragraph 6 thereof, the modification of the 
Schedule of the European Communities in order to cover these new members of the European Union. 
  The new members of the European Union will be subject to the Schedules of the European 
Communities on 1 January 2007. Consequently, the commitments in Schedule CXXXIX of the 
Republic of Bulgaria and Schedule LXIX of  Romania are withdrawn on 1 January 2007. 
 
 The data necessary for the purposes of applying Article XXIV.6 GATT 1994, as provided for in the Guidelines, paragraph 2, first and second  sentences, is included in the Annex of this 
notification.
2  In accordance with the Guidelines, paragra ph 2, third sentence, and paragraph 3, any 
proposed modifications or compensatory adjustments will be circulated and communicated separately. 
 
 The European Communities is  ready to enter into Artic le XXIV and XXVIII GATT 1994 
procedures including tariff negotia tions or consultations to address compensatory adjustments 
provided for under Article XXIV.6 GATT 1994.   The European Communities requests the Secr etariat to inscribe an item concerning these 
notifications on the agenda of the next Council meet ing, subject to the rules on inclusion of items on 
the agenda, so that the Council may take any appropriate actions in this respect. 
  Pursuant to the Guidelines, paragraph 1, the European Communities transmits this notification 
to the Secretariat, and requests the Secretariat to di stribute this notification to all other Members in a 
secret document. 
   Annex
:  Data for applying Article XXIV.62. 
 
                                                      
1 http://eur-lex.europa.eu/JOHtml.d o?uri=OJ:L:2005:157:SOM:EN:HTML  
2 The data are available in electroni c format and in English only.    WT/DS27/RW/USA 
 Page D-1 
 
 
  ANNEX D  
 
SECTION VIII (CONCLUSIONS AND RECOMMENDATIONS) 
OF THE PANEL REPORT ON EC – BANANAS III (ARTICLE 21.5 – ECUADOR II)  
  
VIII. CONCLUSIONS AND RECOMMENDATIONS 
 
8.1 In light of the findings above, the Panel rejects the preliminary issue raised by the European Communities that Ecuador is prevente d from challenging the European Communities' 
current import regime for bananas, including th e preference for ACP countries, because of the 
Understanding on Bananas, signed by  both Members in April 2001. 
 8.2 Accordingly, and after having examined the s ubstantive claims raised by Ecuador as well as 
the defences invoked by the European Co mmunities, the Panel concludes that: 
 
(a) The preference granted by the European Co mmunities to an annual duty-free tariff 
quota of 775,000 mt of imported bananas orig inating in ACP countries constitutes an 
advantage for this category of bananas,  which is not accorded to like bananas 
originating in non-ACP WTO Members, and is therefore inconsistent with Article I:1 
of GATT 1994; 
(b) With the expiration of the Doha Waiver fro m 1 January 2006 as it applied to bananas, 
there is no evidence that, during the period that  is relevant for this Panel's findings, 
that is, from the time of the establishment of  the Panel until the date of this Report, 
any waiver from Article I:1 of GATT 1994 h as been in force to cover the preference 
granted by the European Communities to the duty-free tariff quota of imported 
bananas originating in ACP countries; 
(c) The European Communities' current bana na import regime, in particular its 
preferential tariff quota reserved for ACP countries, is inconsistent with Article XIII:1, with the chapeau of Article XIII:2, and with Article XIII:2(d) of the 
GATT 1994; 
(d) The tariff applied by the European Commun ities to MFN imports of bananas, set at 
€176/mt, without consideration of the tariff quota for 2.2 million mt bound at an in-
quota tariff rate of €75/mt, is an ordinary customs duty in excess of that set forth and provided for in Part I of the European Comm unities' Schedule.  This tariff is therefore 
inconsistent with the first sentence of  Article II:1(b) of the GATT 1994; and, 
(e) It is unnecessary, for the resolution of this dispute, to make a separate finding on 
Ecuador's claim under Article II:1(a) of the GATT 1994. 
8.3 In consequence, the Panel concludes that, th rough its current regime for the importation of 
bananas, established in Council Regulation (EC) No. 1964/2005 of 29 November 2005, including the 
duty-free tariff quota for bananas originating in AC P countries and the MFN tariff currently set at 
€176/mt, the European Communities has failed to im plement the recommendations and rulings of the 
DSB. 
 
8.4 Under Article 3.8 of the DSU, in cases wher e there is infringement of obligations assumed 
under a covered agreement, the action is considered prima facie to cons titute a case of nullification or 
impairment of benefits under th at agreement.  The European Co mmunities has failed to rebut this 
presumption.  Accordingly, we conclude that to  the extent that the European Communities has WT/DS27/RW/USA 
Page D-2  
 
  maintained measures inconsistent with different provisions of the GATT 1994, it continues to nullify 
or impair benefits accruing to Ecuador under that Agreement. 
 8.5 The Panel recommends that the Dispute Settle ment Body request the European Communities 
to bring the inconsistent measures into conf ormity with its obligations under the GATT 1994. 
 
__________