JAPAN – COUNTERVAILING DUTIES ON DYNAMIC RANDOM ACCESS MEMORIES FROM KOREA
Document: Understanding between Japan and the Republic of Korea Regarding Procedures under Articles 21 and 22 of the DSU
Date: 10 September 2008
Document codes: WT/DS336/18
Complainant: South Korea
Respondent: Japan
Third parties: China, EU, Taiwan, U.S.
Dispute stage: Appellate Body
Agreements cited: Art. 1, 2, 14, 10, 15, 19, 21, 11, 12, 32.1, 15.5, 1.1, 19.1, 19.4  Subsidies and Countervailing Measures (SCM)Art. VI:3, X:3  GATT 1994

JAPAN – COUNTERVAILING DUTIES ON
DYNAMIC RANDOM ACCESS MEMORIES FROM KOREA

Understanding between Japan and the Republic of Korea

Regarding Procedures under Articles 21 and 22 of the DSU

 The following communication, dated 9 Septem ber 2008, from the delegation of Japan and the
delegation of Korea to the Chairman of the Dispute Settlement Body, is circulated at the request of
these delegations.

 Please find attached the Confirmed Procedur es between Japan and the Republic of Korea
under Articles 21 and 22 of the Dispute Settlement Understanding in the dispute (WT/DS336).

 We kindly request you to circulate this communication to the Members of the DSB.

 For the Republic of Korea For Japan

 (signed) (signed)
 Lee Sung-joo Shinichi Kitajima
 Ambassador Ambassador
 Permanent Representative of Korea Permanent Representative of Japan
 to the to the

Confirmed Procedures between Japan and the Republic of Korea
under Articles 21 and 22 of the Dispute Settlement Understanding in the dispute

(WT/DS336)

 On 17 December 2007, the Dispute Settlement Body ("DSB") adopted its recommendations
and rulings in the dispute ( and ). At the DSB meeting of 15 January 2008, Japan
announced its intention to comply with the reco mmendations and rulings of the DSB. Japan and
Korea ("the Parties to the dispute") were not able to reach an agreement on the reasonable period of
time, and on 25 February 2008, Korea requested that the reasonable period of time be determined
through binding arbitration pursuant to Article 21.3(c) of the Understanding on Rules and Procedures
Governing the Settlement of Dispute ("DSU"). The arbitrator determined that the reasonable period of
time for Japan to comply with the recommendations a nd rulings of the DSB in this dispute would be
eight months and two weeks from the date of the adoption of the Panel a nd Appellate Body reports,
expiring on 1 September 2008. This arbitration report was circulated to WTO members on 5 May
2008 (WT/DS336/16).

 On 29 August, 2008, Japan issued Cabinet Order No. 266 published in the Special Issue
No. 189 of the Official Gazette, modifying the countervailing duties imposed on DRAMs from Korea
in response to the recommendations and rulings of the DSB and reported to the DSB that it has
complied with the recommendations and rulings of the DSB in a manner consistent with its WTO
obligations. However, Korea does not consid er that Japan has fully complied with the
recommendations and rulings of the DSB within th e reasonable period of time and wishes to reserve
its right under Articles 21 and 22 of the DSU.

 The Parties to the dispute have decided on the following procedures for the exclusive
purposes of this dispute, which are designed to facilita te the resolution of the dispute, and are without
prejudice to either Party's views on the correct interpretation of the relevant provisions of the DSU:

1. Should Korea decide to invoke Article 21.5 of the DSU, Korea may request the establishment
of a panel pursuant to Article 21.5 of the DS U ("Article 21.5 panel") at any time on or after
the date of signing of this Confirmed Procedures. For this purpose, the Parties to the dispute
confirm that consultations pursuant to Article 4 of the DSU regarding that matter are not
necessary for the establishment of the Article 21.5 panel.

2. At the first DSB meeting at which Korea's request for the establishment of an Article 21.5
panel appears on the agenda, Japan will accept the establishment of that panel.

3. The Parties to the dispute will cooperate to en able the Article 21.5 panel to circulate its report
within 90 days of the panel's composition, excl uding such time during which the panel's work
may be suspended pursuant to Article 12.12 of the DSU.

4. Either Party to the dispute may request the DSB to adopt the report of the Article 21.5 panel
at a DSB meeting held at least 20 days after the circulation of the report to the Members
unless the other Party to the dispute appeals the report. If a Party to the dispute has notified
its decision to appeal, the report by the Article 21.5 panel will not be considered for adoption
by the DSB until after completion of the appeal.

5. In the event of an appeal against the Article 21.5 panel report, the Parties to the dispute will
cooperate to enable the Appellate Body to circulate its report to the Members within the time
period described in Article 17.5 of the DSU.

6. In the event of an appeal, either Party to th e dispute may request the DSB to adopt the reports
of the Appellate Body and the Article 21.5 panel (as modified by the Appellate Body report)
at a DSB meeting held within 30 days of the circulation of the Appellate Body report to the
Members.

7. Korea will not request authorization fro m the DSB to suspend concessions or other
obligations pursuant to Article 22 of th e DSU until the adoption by the DSB of the
Article 21.5 panel report and, where relevant, the Appellate Body report.

8. If, as a result of the proceedings pursuant to Article 21.5, the DSB adopts recommendations
and rulings which are based on the findings that measures taken by Japan to comply with the
prior recommendations and rulings of the DSB do not exist or are inconsistent with a covered
agreement, Korea has the right under Article 22.2 of the DSU to request negotiations with
Japan with a view to developing mutually acceptable compensation, and to request
authorization from the DSB to suspend con cessions or other obligations pursuant to
Article 22.2 and 22.6 of the DSU.

9. Subject to paragraphs 7 and 8, Korea has the right to request the DSB authorization referred
to therein at any future date following the adoption by the DSB of the Article 21.5 panel
report and, where relevant, the Appellate Body report. Japan will not assert that Korea is
precluded from obtaining the DSB authorization because the request was made outside the
30-day time-period specified in Article 22.6 of the DSU.

10. Japan retains the right to object to the leve l of suspension proposed, or to claim that the
principles and procedures set forth in Article 22.3 of the DSU have not been followed, and to
have the matter referred to arbitration u nder Article 22.6 of the DSU ("Article 22.6
arbitration").

11. If the matter has been referred to the Article 22. 6 arbitration, the Parties to the dispute will
cooperate to enable the arbitrator under Article 22.6 arbitration to circulate its decision within
60 days of the referral to arbitration.

12. The Parties to the dispute will cooperate to fac ilitate the participation of the original panelists
in the Article 21.5 panel and the Article 22.6 arbitration.

13. If any of the original panelists is not ava ilable for either the Article 21.5 panel or the
Article 22.6 arbitration (or both), the Parti es to the dispute will promptly consult on a
replacement panelist, and either Party to the di spute may request the Director-General of the
WTO to appoint, as soon as possible, a replace ment for the proceeding or proceedings in
which a replacement is required. If an original pa nelist is unavailable to serve in either of the
proceedings, the Parties to the dispute will further request that, in making this appointment,
the Director-General seek a person who will be available to act in both proceedings.

14. The Parties to the dispute will continue to c ooperate in all matters re lated to this Confirmed
Procedures and not to raise any procedural objection to any of the steps set out herein. If,
during the application of these procedures, the Parties to the dispute consider that a procedural
aspect has not been properly addressed in this C onfirmed Procedures, they will endeavor to
find a solution within the shortest time possible that will not affect the other aspects and steps
confirmed herein.

15. In order to fully safeguard their respective rights under the DSU, the Parties to the dispute
confirm to immediately notify this Confirmed Procedures to the DSB.

 For the Republic of Korea For Japan

 (signed) (signed)
 Lee Sung-joo Shinichi Kitajima
 Ambassador Ambassador
 Permanent Representative of Korea Permanent Representative of Japan
 to the World Trade Organization to the World Trade Organization

Geneva, 9 September 2008