AUSTRALIA – CERTAIN MEASURES CONCERNING TRADEMARKS, GEOGRAPHICAL INDICATIONS AND OTHER PLAIN PACKAGING REQUIREMENTS APPLICABLE TO TOBACCO PRODUCTS AND PACKAGING AB-2018-4 AB-2018-6
Document: AB-2018-6 Reports of the Appellate Body Addendum
Date: 9 June 2020
Document codes: WT/DS435/AB/R/Add.1; WT/DS441/AB/R/Add.1; WT/DS435/AB/R; WT/DS441/AB/R.
Complainant: Honduras
Respondent: Australia
Third parties: Argentina, Brazil, Canada, Chile, China, Cuba, Dominican, EU, India, Indonesia, Japan, South Korea, New Zealand, Nicaragua, Nigeria, Norway, Oman, Panama, Philippines, South Africa, Taiwan, Thailand, Ukraine, U.S., Uruguay, Zimbabwe, Guatemala, Singapore, Guatemala, Malawi, Malaysia, Mexico, Singapore, Turkey, Zambia, Peru, Ecuador
Dispute stage: Appellate Body
Agreements cited: Art. 20, 16.1, 15.4, 2.1, 24.3, 22.2(b), 3.1  Intellectual Property (TRIPS)Art. 2.1, 2.2  Technical Barriers to Trade (TBT)Art. III:4  GATT 1994Art. 8, 17  Intellectual Property (TRIPS)

AUSTRALIA – CERTAIN MEASURES CONCERNING TRADEMARKS,
GEOGRAPHICAL INDICATIONS AND OTHER PLAIN PACKAGING
REQUIREMENTS APPLICABLE TO TOBACCO PRODUCTS AND PACKAGING
AB-2018-4
AB-2018-6
Reports of the Appellate Body
Addendum
This Addendum contains Annexes A to C to the Report s of the Appellate Body circulated as
documents ,

The Notices of Appeal s and the executive summaries of written submissions contained in this
Addendum are attached as they were recei ved from the participants and third participants. The
content has not been revised or edited by the Appellate Body, except that paragraph and
footnote numbers that did not start at 1 in the original may have been renumbered to do so, and
the text may have been formatted in order to adhere to WTO style. The executive summaries do not
serve as substitutes for the submissions of the participants and third participants in the
Appellate Body's examination of the appeal.

 •

LIST OF ANNEXES
ANNEX A
NOTICES OF APPEALS
Contents Page
Annex A-1 Honduras' Notice of Appeal 4
Annex A-2 Dominican Republic's Notice of Appeal 10
ANNEX B
ARGUMENTS OF THE PARTICIPANTS
Contents Page
Annex B-1 Executive summary of Honduras' appellant's submission 14
Annex B-2 Executive summary of the Dominican Republic's appellant's submission 26
Annex B-3 Executive summary of Australia's appellee's submission 51
ANNEX C
ARGUMENTS OF THE THIRD PARTICIPANTS
Contents Page
Annex C-1 Executive summary of Argentina's third participant's submission 70
Annex C-2 Executive summary of Brazil's third participant's submission 71
Annex C-3 Executive summary of Canada's third participant's submission 72
Annex C-4 Executive summary of China's third participant's submission 73
Annex C-5 Executive summary of the Dominican Republic's third participant's submission 74
Annex C-6 Executive summary of the European Union's third participant's submission 75
Annex C-7 Executive summary of Indonesia's third participant's submission 77
Annex C-8 Executive summary of Japan's third participant's submission 81
Annex C-9 Executive summary of Malawi's third participant's submission 82
Annex C-10 Executive summary of Mexico's third participant's submission 83
Annex C-11 Executive summary of New Zealand's third participant's submission 84
Annex C-12 Executive summary of Nigeria's third participant's submission 86
Annex C-13 Executive summary of Norway's third participant's submission 87
Annex C-14 Executive summary of the Philippines' third participant's submission 88
Annex C-15 Executive summary of Singapore's third participant's submission 89
Annex C-16 Executive summary of Thailand's third participant's submission 91
Annex C-17 Executive summary of the United States' third participant's submission 92
Annex C-18 Executive summary of Zambia's third participant's submission 94
Annex C-19 Executive summary of Zimbabwe's third participant's submission 95
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX A
NOTICES OF APPEALS
Contents Page
Annex A-1 Honduras' Notice of Appeal 4
Annex A-2 Dominican Republic's Notice of Appeal 10
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX A-1
HONDURAS' NOTICE OF APPEAL
Pursuant to Articles 16.4 and 17 of the Understanding on Rules and Procedures Governing the
Settlement of Disputes ("DSU") and Rule 20 of the Working Procedures for Appellate Review
(WT/AB/WP/6, 16 August 2010) ("Working Procedures"), Honduras hereby notifies the Dispute
Settlement Body ("DSB") of its decision to appeal certain issues of law and legal interpretation in
the Panel Report in Australia – Certain Measures Concerning Trademarks, Geographical Indications
and Other Plain Packaging Requirements Applicable to Tobacco Products and Packaging (WT/DS435)
("Panel Report").
Pursuant to Rules 20(1) and 21(1) of the Working Procedures, Honduras files this Notice of Appeal
together with its Appellant Submission with the Appellate Body Secretariat.
Pursuant to Rule 20(2)(d)(iii) of the Working Procedures, this Notice of Appeal includes an indicative
list of the paragraphs of the Panel Report containing the alleged errors, without prejudice to
Honduras' ability to rely on other paragraphs of the Panel Report in its appeal.
Honduras seeks the Appellate Body's review of the Panel's conclusions that Honduras has not
demonstrated that Australia's Tobacco Plain Packaging measures, as identified in Honduras' request
for the establishment of a panel (the "TPP measures" or "plain packaging measures"), are
inconsistent with Australia's obligations under Articles 20 and 16.1 of the Agreement on
Trade-Related Aspects of Intellectual Property Rights ("TRIPS Agreement");1 and Article 2.2 of the
Agreement on Technical Barriers to Trade ("TBT Agreement").2
In particular, Honduras has identified the following errors of law and legal interpretation, including
the failure of the Panel to make an objective assessment of the matter as required by Article 11 of
the DSU.
I. REVIEW OF THE PANEL'S FINDINGS UNDER THE TRIPS AGREEMENT
 1. The Panel's interpretation and application of the term "unjustifiably" in
Article 20 of the TRIPS Agreement is in error
Honduras appeals the Panel's finding that Honduras has not demonstrated that the TPP measures
are inconsistent with Article 20 of the TRIPS Agreement since this finding is based on an erroneous
legal interpretation of the term "unjustifiably" in Article 20. In addition, and in the alternative, the
Panel's application of Article 20 of the TRIPS Agreement to the plain packaging measures constitutes
an error of law.
First, the Panel's interpretation of the term "unjustifiably" as referring to "good reasons" sufficient
to support special requirements encumbering the use of a trademark is in error. 3 The Panel fails to
interpret the term "unjustifiably" on the basis of its ordinary meaning, in the context of Section 2 of
the TRIPS Agreement on trademarks, and in the light of the object and purpose of the
TRIPS Agreement. In addition, the Panel errs in law in its analysis by finding that paragraph 5 of the
Doha Declaration on the TRIPS Agreement and Public Health constitutes a subsequent agre ement
under Article 31.3(a) of the Vienna Convention on the Law of Treaties.4

 This document, dated 19 July 2018, was circulated to Members as document WT/DS435/23.

1 Panel Report, paras. 8.1(d) and (e).
2 Panel Report, para. 8.1(a).
3 Panel Report, paras. 7.2394-7.2396, 7.2430, and related paras. 7.2439-7.2442, and 7.2492-7.2508.
4 Panel Report, paras. 7.2409-7.2411.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

Second, and in the alternative, should the Appellate Body find that the Panel's legal interpretation
was correct, the Panel errs in law in the application of Article 20 of the TRIPS Agreement to the plain
packaging measures.5 In particular, among others:
• The Panel errs in its failure to focus the analysis on the impact on the distinguishing
function of a trademark.6
• The Panel errs in its application of Article 20 of the TRIPS Agreement to the product as
its finding are focused on the packaging only.7
• The Panel errs in its examination of available alternative measures that are less
trademark encumbering while providing an equivalent contribution;8
• The Panel errs by relying on non -covered agreements to justify the plain packaging
measures.9
Honduras requests the Appellate Body to reverse the Panel's findings under Article 20 of the
TRIPS Agreement, which are vitiated by the above errors of law and legal interpretation,10 and thus
to declare moot and of no legal effect the Panel's findings that Honduras has not demonstrated that
the TPP measures are inconsistent with Article 20 of the TRIPS Agreement.11
 2. The Panel's interpretation and application of the "rights confer red" under
Article 16.1 of the TRIPS Agreement is in error
Honduras appeals the Panel's finding that Honduras has not demonstrated that the TPP measures
are inconsistent with Article 16.1 of the TRIPS Agreement.12 This finding is based on an erroneous
legal interpretation of the "rights conferred" by Article 16.1 and the related obligation on Members
to ensure the minimum guaranteed level of protection for trademark owners, and is vitiated by an
error of law in the application of Article 16.1 of the TRIPS Agreement to the plain packaging
measures.
First, the Panel's interpretation of Article 16.1 of the TRIPS Agreement on the "rights conferred" to
trademark owners is in error, as the Panel fails to interpret this provision in good faith, based on the
ordinary meaning of all of the terms used, in their context, and in the light of the object and purpose
of the TRIPS Agreement.13 The Panel's erroneous approach led to a number of related errors of law,
including among others the following:
• The Panel errs in finding that Article 16.1 of the TRIPS Agreement does not protect the
distinctiveness of a trademark.14
• The Panel errs in finding that Article 16.1 of the TRIPS Agreement is not engaged and
can therefore not be violated unless there is a risk of actual confusion.15
Second, the Panel errs in its application of Article 16.1 of the TRIPS Agreement to the plain
packaging measures as it does not consider it necessary to address the relevant question of whether
the plain packaging measures reduce the distinctiveness of the trademark and its scope of protection
such that the level of protection falls below the minimum level that Members are required to
guarantee under Article 16.1 of the TRIPS Agreement.16 The Panel's erroneous exercise of judicial
economy is an error of law. In addition, as a result of this false exercise of judicial economy, the

5 Panel Report, paras. 7.2556-7.2574, 7.2586-7.2589, and 7.2590-7.2606.
6 See, e.g. Panel Report, paras. 7.2569-7.2571, and 7.2604-7.2606.
7 See, e.g. Panel Report, para. 7.2570.
8 See, e.g. Panel Report, paras. 7.2600-7.2601.
9 See, e.g. Panel Report, paras. 7.2595-7.2596, and 7.2604.
10 See, e.g. Panel Report, paras. 7.2393-7.2431, and 7.2556-7.2606.
11 Panel Report, paras. 7.2606, and 8.1(e).
12 Panel Report, para. 8.1(d).
13 Panel Report, paras. 7.1966-7.2032, and 7.2051.
14 See, e.g. Panel Report, paras. 7.2005-7.2016.
15 See, e.g. Panel Report, paras. 7.2000, and 7.2010.
16 Panel Report, paras. 7.2015, and 7.2032.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

Panel also fails to comply with its obligation under Article 11 of the DSU to make an objective
assessment of the matter.
Honduras requests the Appellate Body to reverse the Panel's findings which are vitiated by the above
errors of law and legal interpretation, and thus to declare moot and of no legal effect also the Panel's
finding that Honduras has not demonstrated that the TPP measures are inconsistent with Australia's
obligations under Article 16.1 of the TRIPS Agreement.17
II. REVIEW OF THE PANEL'S FINDINGS UNDER ARTICLE 2.2 OF THE TBT AGREEMENT
Honduras appeals the Panel's finding that Honduras has not demonstrated that the plain packaging
measures are inconsistent with Article 2.2 of the TBT Agreement.18 The Panel's finding is vitiated by
a number of errors of law and legal interpretation with respect to each aspect of the enquiry under
Article 2.2 of the TBT Agreement relating to (1) the trade -restrictive nature of the plain packaging
measures; (2) the degree of contribution by the plain packaging measures to the legitimate objective
of Australia; and (3) the availability of less trade -restrictive alternative measures that provide an
equivalent contribution to that legitimate objective.
 1. The Panel's interpretation of the term "trade -restrictive" in Article 2.2 of the
TBT Agreement and its application to the TPP measures is in error
The Panel errs in its interpretation and application of the term "trade-restrictive" in Article 2.2 of the
TBT Agreement, and Honduras therefore requests the Appellate Body to modify the Panel's
conclusion that the plain packaging measures are trade restrictive. 19 In particular, among others,
the Panel commits the following errors of law and legal interpretation:
• The Panel errs in its finding that a modification or distortion of conditions of competition
or the competitive opportunities for imported products is onl y a "trade" distortion if it
de jure restricts imports or is discriminatory in nature.20
• The Panel errs in imposing a different and higher evidentiary standard of demonstrating
actual trade effects for measures that are not challenged as being discriminato ry in
nature and by thus requiring that evidence must be adduced of actual trade effects of
the plain packaging measures on prices and sales to demonstrate that this distortion
amounts to a restriction on trade.21
 2. The Panel's application of the legal st andard with respect to the degree of
contribution to the TPP measures is in error
The Panel errs in its application of the legal standard for assessing the degree of contribution of the
plain packaging measures.22 In particular, among others, the Panel commits the following errors:
• The Panel errs by examining the degree of contribution of the measures to the specific
"mechanisms" by which the measures were expected to achieve the objective rather
than by examining the degree of contribution to the fulfilment of the legitimate objective
as identified.23
• The Panel errs when failing to examine the "actual" contribution of the plain packaging
measures instead basing its finding on unsubstantiated speculation about an u ncertain
future impact of the measures "over time" without any qualitative or quantitative
projections supported by sufficient evidence.24

17 Panel Report, para. 8.1(d).
18 Panel Report, paras. 8.1(a), and 7.1724-7.1732.
19 Panel Report, paras. 7.1071-7.1089, and 7.1160-7.1255.
20 Panel Report, paras. 7.1166-7.1168, 7.1196-7.1197, 7.1214-7.1218, and 7.1255.
21 Panel Report, paras. 7.1074-7.1075, 7.1166, 7.1208, and 7.1255.
22 Panel Report, paras. 7.483-7.1045.
23 See, e.g. Panel Report, paras. 7.1024-7.1034.
24 Panel Report, para. 7.1044.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

• The Panel errs by not determining the degree of contribution of the challenged plain
packaging measures themselves.25
• The Panel errs in its application of the legal standard it set for itself for examining the
evidence.26
Honduras requests the Appellate Body to reverse the Panel's findings on the degree of contribution
of the plain packaging measures since these are vitiat ed by the above errors of law and legal
interpretation.27
 3. The Panel errs in law in its interpretation and application of Article 2.2 of the
TBT Agreement with respect to the availability of less trade -restrictive
alternative measures
The Panel errs in its interpretation and application of Article 2.2 of the TBT Agreement with respect
to the availability of less trade -restrictive alternative measures that provide an equivalent
contribution to the legitimate objective. 28 In particular, among others, the Pan el commits the
following legal errors:
• The Panel errs in its interpretation and examination of whether the alternative measures
that were presented by Honduras were less "trade restrictive" by failing to examine
their impact on the conditions of competition and on competitive opportunities, instead
unduly focusing on their degree of contribution to the objective.29
• The Panel errs in its interpretation and application of the legal standard for assessing
whether the alternative measures provided an "equivalent" contribution to the
challenged measures. In particular:
o The Panel fails to examine the degree of contributio n of the proposed alternative
measures in light of the legitimate objective as identified;30
o The Panel errs by requiring that the alternative measures provide an identical
contribution as a "substitute" to the challenged measures, rather than an
"equivalent" contribution;31
o The Panel errs by requiring a greater degree of contribution by the proposed
alternatives;32 and
o The Panel errs when applying a different standard for assessing equivalence
depending on whether a measure is part of a suite of measures.33
Honduras requests the Appellate Body to reverse the Panel findings on the availability of less trade
restrictive alternative measures which are vitiated by the above errors of law and legal
interpretation.34

25 See, e.g. Panel Report, paras. 7.974, 7.1036, and 7.1043.
26 See, e.g. Panel Report, paras. 7.499, 7.622, 7.643-644, 7.660, 7.695, and 7.697.
27 Panel Report, paras. 7.1024-7.1045, and 7.1724-7.1732.
28 Panel Report, paras. 7.1362-7.1723, and 7.1724-7.1732.
29 See, e.g. Panel Report paras. 7.1411-7.1417 (MLPA); and 7.1490-7.1495 (Taxation increase).
30 See, e.g. Panel Report, paras. 7.232. (Defining the legitimate objective); 7.1459-7.1460, 7.1464,
7.1468-7.1471 (MLPA); and 7.1526-7.1527, 7.1531, 7.1542-7.1545 (Taxation increase).
31 See, e.g. Panel Report, paras. 7.1455-7.1461, 7.1464 (MLPA); and 7.1526-7.1527, 7.1529, 7.1531
(Taxation increase).
32 See, e.g. Panel Report, paras. 7.1376, 7.1391, 7.1461, 7.1528, and 7.1721-7.1722.
33 Panel Report, paras. 7.1376-7.1391.
34 See, e.g. Panel Report, paras. 7.1468-7.1471 (MLPA); 7.1542-7.1545 (Taxation increase); and
7.1724-7.1732 (Overall conclusion).
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

III. REVIEW OF THE P ANEL'S ASSESSMENT OF THE EVID ENCE ON THE DEGREE O F
 CONTRIBUTION OF THE TPP MEASURES
Honduras requests the Appellate Body's review of the assessment the Panel made of the evidence
that was presented on the degree of contribution of the plain packaging measures to the
achievement of Australia's identified legitimate objective. Honduras submits that the Panel fails to
conduct an "objective examination" of the evidence on the plain packaging measures' contribution
to the objective of reducing the use of tobacco products in violation of its obligation under Article 11
of the DSU. In particular, among others:
• The Panel fails to provide a reasoned and adequate explanation of how the facts before
it supported the conclusion that the plain packaging measures were apt to, and do,
make a meaningful contribution to their legitimate objective because, inter alia:
o The Panel's own findings on actual smoking behaviour, proximal and distal
outcomes do not support its conclusion.35
o The Panel's intermediate findings on the effect of the plain packaging measures
are not based on the totality of the evidence on the record and are not supported
by a reasoned and adequate explanation;
o The Panel's findings on the effects of the measures " over time" are not based on
any quantitative or qualitative analysis or reasoned explanation supported by
sufficient evidence;
o The Panel's intermediate findings on the relevance of the behavioural science
theories are internally inconsistent and not supported by a reasoned and adequate
explanation;
o The Panel's findings on the contribution of the measures to the reduction in cigar
smoking do not have a sufficient basis in the evidence on the record and are not
supported by a reasoned and adequate explanation.
• The Panel disregards, ignores and misrepr esents the evidence presented by the
complainants.
• The Panel fails to examine the evidence on contribution in an even-handed manner and
applies a double standard of proof in favour of Australia.
• The Panel fails to respect the due process rights of the part ies by not exercising its
authority under Article 14.2 of the TBT Agreement or Article 13 of the DSU to appoint a
technical expert and by instead relying on a "ghost expert" raising alleged "robustness"
concerns not identified by any of the parties without ever offering the parties an
opportunity to comment on or subsequently review the concerns and methodologies of
this ghost expert.
Honduras therefore requests the Appellate Body to reverse the Panel's findings and conclusions
relating to the degree of co ntribution of the measures in the Panel Report and its Appendices,36 as
such findings were not the result of an objective assessment of the matter. The failure to objectively
assess the evidence vitiates the Panel's findings on the degree of contribution of the measures and
thus its findings under Article 2.2 of the TBT Agreement and Article 20 of the TRIPS Agreement,
which should therefore be reversed.

35 Panel Report, paras. 7.945-7.958 and Appendix A (Proximal outcomes); 7.959-7.963 and Appendix B
(Distal outcomes); 7.968-7.972 and Appendix C (Smoking prevalence); paras. 7.973-7.979 and Appendix D
(Consumption and sales impact); 7.980-7.986 and 7.1024-7.1045 (Overall conclusions); see also
Panel Report: Appendix A, paras. 86-87; Appendix B, paras. 120-121; Appendix C, paras. 123-124; and
Appendix D, paras. 137-138 (leading to the unqualified finding in para. 7.1043 of the Panel Report on actual
smoking behaviour).
36 Panel Report, paras. 7.1024-7.1045 and Appendices.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

For this reason as well, Honduras requests the Appellate Body to declare moot and of no effect the
Panel's findings that Honduras has not demonstrated that the TPP measures are inconsistent with
Australia's obligations under Article 2.2 of the TBT Agreement,37 and the related finding that
Honduras has not demonstrated that the TPP measures are inconsistent with Australia's obligations
under Article 20 of the TRIPS agreement.38

37 Panel Report, paras. 7.1732, and 8.1(a).
38 Panel Report, paras. 7.2606, and 8.1(e).
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX A-2
DOMINICAN REPUBLIC'S NOTICE OF APPEAL
1. Pursuant to Article 16.4 and Article 17.1 of the Understanding on Rules and Procedures
Governing the Settlement of Disputes ("DSU"), the Dominican Republic hereby notifies to the
Dispute Settlement Body its decision to appeal to the Appellate Body certain issues of law covered
in the Panel Report and certain legal interpretations developed by the Panel in the dispute Australia
– Certain Measures Concerning Trademarks, Geographical Indications and other Plain Packaging
Requirements Applicable to Tobacco Products and Packaging (DS441).
2. Pursuant to Rule 20(1) of the Working Procedures for Appellate Review , t he
Dominican Republic simultaneously files this Notice of Appeal with the Appellate Body Secretariat.
3. The Dominican Republic restricts its appeal to those errors that it believes constitute serious
errors of law and legal interpretation that need to be cor rected. Non-appeal of an issue does not
signify agreement therewith. The Dominican Republic also believes that it may not be necessary for
the Appellate Body to decide all the issues raised in this notice of appeal since some may become
moot as a result of decisions on other issues.
4. For the reasons to be further elaborated in its submissions to the Appellate Body, the
Dominican Republic appeals, and requests the Appellate Body to reverse, modify, or declare moot
and of no legal effect certain findings and c onclusions of the Panel, with respect to the following
errors of law and legal interpretations contained in the Panel Report:
I. APPEALS OF THE PANEL'S FINDINGS UNDER ARTICLE 2.2 OF THE TBT AGREEMENT1
 ON THE CONTRIBUTION OF THE TPP MEASURES
5. The Dominican Republic appeals the Panel's finding that "the Dominican Republic has not
demonstrated that the TPP measures are inconsistent with Australia's obligations under Article 2.2
of the TBT Agreement".2 The Panel failed to make an objective assessment of the matter before it,
as required under Article 11 of the DSU, as elaborated below.
6. The Dominican Republic appeals the Panel's overall conclusion on the contribution of the
TPP measures to Australia's objective. 3 The Panel failed to make an objective assessment of the
matter before it, as required under Article 11 of the DSU.
7. The Dominican Republic appeals the Panel's overall findings 4 and intermediate findings 5
resulting from its assessment of the evidence from the period after the implementation of the
TPP measures ("post -implementation" evidence) on the actual impact of the TPP measures on
smoking behaviours – i.e., prevalence and consumption – in Australia. The Panel failed to make an
objective assessment of the matter before it, as required under Article 11 of the DSU.
8. The Dominican Republic appeals the Panel's overall findings 6 and intermediate findings 7
resulting from its assessment of the evidence from the period prior to the implementation of the
TPP measures ("pre-implementation evidence") on the anticipated impact of the TPP measures. The

 This document, dated 23 August 2018, was circulated to Members as document WT/DS441/23.

1 The Agreement on Technical Barriers to Trade ("TBT Agreement").
2 Panel Report, paras. 8.1(b)(i). See also Panel Report, para. 7.1732.
3 Panel Report, paras. 7.1025, 7.1040-7.1043, 7.1045, 7.1725(b).
4 Panel Report, paras. 7.972, 7.979, 7.980-7.986, 7.1037, 7.1039; Appendix C, paras. 122 and 123;
and Appendix D, paras. 117 and 137.
5 Panel Report, paras. 7.964-7.971, 7.973-7.978; Appendix C, paras. 8, 51-57, and 96-122; and
Appendix D, paras. 101-116.
6 Panel Report, paras. 7.929-7.931, 7.1024-7.1034, and 7.1038.
7 Panel Report, paras. 7.518-7.928.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

Panel failed to make an objective assessment of the matter before it, as required under Article 11
of the DSU.
9. The Dominican Republic appeals the Panel's overall finding s8 and intermediate findings 9
resulting from its assessment of the post-implementation evidence on the actual impact of the
TPP measures on proximal and distal outcomes. The Panel failed to make an objective assessment
under Article 11 of the DSU.
10. The Domi nican Republic appeals the Panel's overall finding 10 and intermediate findings 11
regarding the potential future impact of the TPP measures. The Panel erred in the application of
Article 2.2 of the TBT Agreement. In addition, the Panel failed to make an objec tive assessment
under Article 11 of the DSU.
II. APPEALS OF THE P ANEL'S FINDINGS UNDER ARTICLE 2.2 OF THE TBT AGREEMENT
 ON THE TRADE-RESTRICTIVENESS OF THE TPP MEASURES
11. The Dominican Republic appeals the Panel's finding that "the Dominican Republic has not
demonstrated that the TPP measures are inconsistent with Australia's obligations under Article 2.2
of the TBT Agreement".12 The Dominican Republic appeals the Panel's overall findings and
intermediate findings on the trade-restrictiveness of the TPP measures, in the context of its analysis
under Article 2.2 of the TBT Agreement.13 The Panel failed to make an objective assessment under
Article 11 of the DSU. In addition, the Panel erred in the application of Article 2.2 of the
TBT Agreement.
III. APPEAL OF THE PANEL'S FINDINGS UNDER ARTICLE 2.2 OF THE TBT AGREEMENT ON
THE AVAILABILITY OF LESS TRADE-RESTRICTIVE ALTERNATIVE MEASURES
12. The Dominican Republic appeals the Panel's finding that "the Dominican Republic has not
demonstrated that the TPP measures are inconsistent with Australia's obligations under Article 2.2
of the TBT Agreement".14 The Dominican Republic appeals the Panel's overall findings and
intermediate findings on the trade-restrictiveness of the Dominican Republic's proposed alternative
measures (relative to the trade restrictiveness of the TPP measures), made in the context of the
Panel's evaluation under Article 2.2 of the TBT Agreement.15 The Panel failed to make an objective
assessment under Article 11 of the DSU. In addition, al so with respect to its analysis of the
trade-restrictiveness of the proposed alternatives, the Panel erred in the application of Article 2.2 of
the TBT Agreement.
13. The Dominican Republic appeals the Panel's overall findings and intermediate findings on the
contribution of the Dominican Republic's proposed alternative measures to Australia's objective
(relative to the contribution of the TPP measures), made in the context of the Panel's evaluation
under Article 2.2 of the TBT Agreement.16 On this issue, the Panel failed to make an objective
assessment under Article 11 of the DSU. In addition, also with respect to its analysis of the
contribution of the proposed alternatives, the Panel erred in the application of Article 2.2 of the
TBT Agreement.

8 Panel Report, paras. 7.985, 7.1036, 7.1038, and 7.1039.
9 Panel Report, paras. 7.945-7.963, 7.980-7.984, 7.1040-7.1042; Appendix A, paras. 28-32, 66-72,
83-86; and, Appendix B, paras. 36-41, 71-77, 99-103, and 113-120.
10 Panel Report, para. 7.1044.
11 Panel Report, paras. 7.938-7.943.
12 Panel Report, paras. 8.1(b)(i). See also Panel Report, para. 7.1732.
13 Panel Report, paras. 7.1071-7.1089, 7.1166-7.1171, 7.1196-7.1225; and, Appendix E, paras. 12-15,
24-32, and 47-56.
14 Panel Report, paras. 8.1(b)(i). See also Panel Report, para. 7.1732.
15 Panel Report, paras. 7.1362-7.1391, 7.1411-7.1418, 7.1459, 7.1468-7.1471, 7.1490-7.1496,
and 7.1542-7.1545.
16 Panel Report, paras. 7.1362-7.1391, 7.1398-7.1402, 7.1432-7.1464, 7.1468-7.1471, 7.1476-7.1480,
7.1506-7.1531, 7.1542-7.1545, and 7.1717-7.1723.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

IV. APPEALS OF THE P ANEL'S FINDINGS UNDE R A RTICLE 20 OF THE
 TRIPS AGREEMENT17
14. The Dominican Republic appeals the Panel's overall findings and intermediate findings that the
TPP measures, to the extent that they prohibit the use of trademarks on ciga rette sticks, do not
unjustifiably encumber the use of a trademark in the course of trade, under Article 20 of the
TRIPS Agreement.18 The Panel failed to examine part of the matter referred to the DSB, in violation
of Article 7.1 of the DSU. In addition, the Panel failed to make an assessment of part of the matter
under Article 11 of the DSU.
15. The Dominican Republic appeals the Panel's overall findings and intermediate findings that the
TPP measures do not unjustifiably encumber the use of a trademark in the course of trade, under
Article 20 of the TRIPS Agreement.19 These Panel findings derive from the Panel's failure to make
an objective assessment under Article 11 of the DSU, in the course of its analysis under Article 2.2
of the TBT Agreement (regarding the contribution of the TPP measures to Australia's objective, and
the existence of less trade-restrictive alternatives that make an equivalent contribution to Australia's
objective).20
V. INCORPORATION OF CLAIMS ON APPEAL BY HONDURAS IN DS435
16. The Dominican Republic incorporates by reference into this appeal the claims on appeal made
by Honduras in the dispute Australia – Certain Measures Concerning Trademarks, Geographical
Indications and Other Plain Packaging Requirements Applicable to Tobacco Products and Pa ckaging
(DS435).21
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX B
ARGUMENTS OF THE PARTICIPANTS
Contents Page
Annex B-1 Executive summary of Honduras' appellant's submission 14
Annex B-2 Executive summary of the Dominican Republic's appellant's submission 26
Annex B-3 Executive summary of Australia's appellee's submission 51
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX B-1
EXECUTIVE SUMMARY OF HONDURAS' APPELLANT'S SUBMISSION
INTRODUCTION1
1. Honduras seeks the Appellate Body's review and reversal of a number of errors of law and
legal interpretation reflected in the Panel Report. In particular, as stated in the Notice of Appeal,
Honduras' appeal concerns a number of the Panel's findings under the Agreement on Trade-Related
Aspects of Intellectual Proper ty Rights ("TRIPS Agreement") and the Agreement on Technical
Barriers to Trade ("TBT Agreement"). In addition, Honduras considers that the Panel failed to make
an "objective assessment" of the evidence before it relating in particular to the degree of contribution
of Australia's tobacco plain packaging measures (hereinafter the "TPP measures" or "plain packaging
measures") to the fulfilment of the objective of the measure, i.e. the reduction of the use of tobacco
products. The Panel thus acted inconsistently with Article 11 of the Understanding on the Rules and
Procedures Governing the Settlement of Disputes ("DSU").
II. CLAIM 1: THE PAN EL'S INTERPRETATION AND APPLICATION OF T HE TERM
"UNJUSTIFIABLY" IN ARTICLE 20 OF THE TRIPS AGREEMENT IS IN ERROR
2. Honduras submits that the Panel's findings in relation to Article 20 of the TRIPS Agreement
are based on an erroneous interpretation of the term "unjustifiably". Alternatively, Honduras
considers that the Panel committed legal error in applying its legal standard to the facts of this case
and its finding under Article 20 thus constituted an error of law for that reason as well.
3. First, the Panel develops an erroneous legal standard for justifying even the most far-reaching
encumbrances on the use of trademarks on lawfully available products. The Panel finds that as long
as there are "good reasons" sufficient to support the measures, any trademark encumbering
requirement, no matter how intrusive, is justifiable. The approach of the Panel and the legal
reasoning supporting it reflects several errors of law and legal interpretation. In particular:
• The Panel fails to read the term "unjustifiably" in its trademark -specific context. The Panel
errs in considering that the term "unjustifiably" effectively introduces a general exception that
justifies any restriction on the use of a trademark when adopted for purposes of furthering
certain otherwise undefined policy objectives or "good reasons". Honduras submits that
whether a requirement "unjustifiably" encumbers the use of a v alidly registered trademark
with respect to a lawfully available product requires the interpreter to examine the specific
concern raised by the encumbered trademark rather than the product to which it applies and
to examine the extent of the encumbrance. W hether the special requirements are
encumbering the use of a trademark in an "undue or disproportionate manner",
i.e. "unjustifiably" must thus be based on an assessment of the particular trademark and of
the manner in which it is encumbered. However, under the Panel's approach there is no need
to examine whether a particular trademark may be problematic and thus be encumbered in
its use, including being prohibited from being used.
In fact, the Panel acknowledges that many of the prohibited trademarks are not problematic
per se. Nevertheless, under its approach to the term "unjustifiably", it considers that their use
may be justifiably prohibited simply because they are trademarks that identify a product. That
cannot be a correct approach given the internat ional protection of trademarks and their use.
For other products as well, the use of trademarks may be encumbered for reasons related to
health or consumer protection. But for no other product are trademarks prevented from being
used simply because they are trademarks or because they belong to a particular category of
trademarks such as figurative marks. Never in the past has it been argued that such a blunt
approach was necessary to protect, for example, health. This confirms the error in the Panel's

1 In line with the requirements of the Working Procedures of the Appellate Body, the total number of
words of the Appellant Submission (including footnotes but excluding the Executive Summary) is = 154,529;
and the total number of words of the Executive Summary is = 8,021.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

approach. The Panel's failure to read the term "unjustifiably" in its trademark-specific context
constitutes an error of law and legal interpretation.
• Alternatively, at a minimum, the Panel should have read the term "unjustifiably" as referring
to measures that are more trademark encumbering than "necessary" by including an analysis
of potentially less trademark -restrictive alternatives. If a less trademark encumbering
requirement provides an equivalent contribution to the legitimate objective, such alternative
must be preferred. The Panel's novel and intention -based "good reasons"-approach does not
include as part of the legal standard the need to prefer less trademark encumbering
alternatives. Therefore, it is not consistent with the principle of Article 8.1 o f the
TRIPS Agreement relating to the adoption of measures "necessary" to protect health. It thus
constitutes an error of law and legal interpretation.
• Related to this error of interpretation relating to Article 20 and Article 8.1 of the
TRIPS Agreement is the Panel's erroneous finding that paragraph 5 of the Doha Declaration
on TRIPS and Public Health constitutes a "subsequent agreement" in the sense of
Article 31.3(a) of the Vienna Convention on the Law of Treaties that must be taken into
consideration as part of the context of the term "unjustifiably" in Article 20 of the
TRIPS Agreement. Paragraph 5 of the Doha Declaration is not a relevant subsequent
agreement for purposes of interpreting the term "unjustifiably in Article 20 of the
TRIPS Agreement. Par agraph 5 of the Doha Declaration merely confirms the general
interpretive rule of reading all provisions of the TRIPS Agreement in the light of the objectives
and principles of the Agreement. Therefore, it does not "bear specifically" on the interpretation
and application of the respective term or provision and cannot be said to "clearly express a
common understanding, and an acceptance of that understanding among Members" with
regard to the meaning of the term "unjustifiably" in Article 20 of the TRIPS Agreement. The
Panel's consideration of paragraph 5 of the Doha Declaration as a "subsequent agreement"
constitutes another error of law that materially affected its analysis under Article 20 of the
TRIPS Agreement.
4. Second, assuming arguendo that the Panel's "justifiability" standard based on whether there
are "good reasons" sufficient to encumber the use of a trademark was correct, the Panel's application
of that legal standard to the facts of the case in the context of its three step test reflects additional
errors of law. These errors undermine the Panel's analysis of the term "unjustifiably" in the context
of the facts of this case and thus vitiate its findings under Article 20 of the TRIPS Agreement. In
particular:
• The Panel erred by failing to pr operly determine the nature and extent of the encumbrance
on the basis of the impact of the measures on the distinguishing function of the trademark.
The Panel erroneously focused on the effect of the measures on the "economic value" of the
trademarks and its considerations relating to the alleged "mitigating" factors are thus in error.
• The Panel erred in its application of Article 20 to the facts of this case which concerned both
tobacco products and their packaging. The Panel's reasoning fails to take in to account
important differences in terms of the application of the measures to, in particular, cigarette
sticks (i.e. the product itself). The Panel attached particular weight in its justifiability analysis
to the fact that the encumbering requirements' e ffects on trademarks were mitigated by the
facts that word marks could still be used, albeit in a standardised form and font. But this is
not correct in so far as the actual product (i.e. cigarette sticks) is concerned since no word
mark may be used on the product under plain packaging. The Panel's failure to apply its
reasoning to cigarette sticks invalidates its findings in so far as they apply also to the product.
• The Panel erred in its examination of the available alternatives as it failed to properly consider
whether the proposed alternatives that Honduras presented were less trademark encumbering
than plain packaging while providing an equivalent contribution. The Panel's approach reflects
two important errors of law. First, the Panel erroneously assumed that the test under Article 20
was exactly the same as the test under Article 2.2 of the TBT Agreement. However, the
TBT Agreement concerns "trade" restrictiveness, while the TRIPS Agreement relates to
"trademark"- encumbrance. Second, the Panel erred in its interpretation of what constitutes
an "equivalent" contribution effectively requiring an "identical" contribution by the alternative
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

measures or even requiring that the proposed alternatives must be " manifestly better in
contributing towards Australia's public health objectives".2
• The Panel erroneously relied on the recommendation in the WHO Framework Convention on
Tobacco Control ("FCTC") Guidelines to consider adopting plain packaging when it concluded
that that there existed "good reasons sufficient to support" the extreme restriction on the use
of trademarks by plain packaging. The Panel effectively disregarded the non -binding nature
of these recommendations. In addition, the Panel completely failed to examine the legal
relevance of the FC TC and its Guidelines in the context of this dispute. The FCTC or its
Guidelines do not apply to three of the four complaining parties since Indonesia and
Dominican Republic are not parties to the FCTC and Cuba has not ratified the FCTC. The Panel
therefore erred in law by giving undue contextual weight to the FCTC and the FCTC Guidelines
when examining the "justifiability" of the plain packaging measures under the legal standard
it developed.
5. Honduras therefore requests the Appellate Body to reverse the Panel's findings, in particular,
in paragraphs 7.2393-7.2431, and paragraphs 7.2604-7.2605, and to declare moot and of no effect
the Panel's findings in paragraphs 7.2606 and 8.1(e) that Honduras has not demonstrated that the
TPP measures are inconsistent with Australia's obligations under Article 20 of the TRIPS Agreement.
III. CLAIM 2: THE PANEL'S ANALYSIS OF ARTICLE 16.1 OF THE TRIPS AGREEMENT IS IN
ERROR AS IS ITS FAILURE TO APPLY THE LAW TO THE FACTS OF THIS CASE
6. Honduras submits that the Panel's inter pretation of Article 16.1 of the TRIPS Agreement on
the "rights conferred" to trademark owners is in error and that its failure to apply the law to the
facts constitutes an error of law. The Panel's false exercise of judicial economy also constitutes a
violation of Article 11 of the DSU.
7. First, the Panel fails to conduct a holistic interpretation of Article 16.1 that takes into
consideration the context of this provision as well as its object and purpose. In particular, the Panel
erred in law by finding that Article 16.1 does not protect distinctiveness and that Article 16.1 is not
engaged if there is no risk of confusion, for example because of the government's deliberate
weakening of the trademark. Honduras submits that Article 16.1 provides private partie s with a
means to an end. The "rights conferred" are guaranteed in order to allow the trademark owner to
protect the distinctiveness of the trademark so that it can perform its important function in the
course of trade, allowing the trademark owner to deve lop goodwill based on that trademark. The
Panel's finding that Article 16.1 does not protect distinctiveness divorces the means from its end,
and is in error.
8. Furthermore, the Panel erred in finding that the right to prevent unauthorised use of the
trademark is not adversely affected if there is less or no likelihood of confusion as a result of
regulation that deprives the consumer of familiarity with the mark. The scope of mandatory rights
defined in Article 16.1 by reference to the concept of "likelihood of confusion" is not tied solely to
the existence of actual marketplace confusion. The Panel's conclusion that Article 16.1 does not
provide a so -called "right to confusion" is a caricature of Honduras' argument rather than an
assessment of it. The "likel ihood of confusion"-test is a normative benchmark that determines the
boundaries of that sphere, similar to the role fulfilled in Article 16.3 for well -known marks by the
"interest"-test. Plain packaging significantly reduces that sphere of exclusivity outside the control of
the trademark owner.
9. Whether this deliberate weakening of the rights conferred is justified may be a matter for
discussion under Article 17 of the TRIPS Agreement and must be assessed on the basis of the terms
of this provision which pe rmits "limited exceptions" to the rights conferred. However, that is not
what the Panel did as it erroneously found that a measure that deliberately seeks to reduce the
strength of the mark and the goodwill developed on the basis of the mark does not even engage
Article 16 of the TRIPS Agreement. The Panel finds that "the negative Article 16.1 right to prevent
infringing uses does not extend to an entitlement to maintain or extend the distinctiveness of an
individual trademark, which inevitably fluctuates a ccording to market conditions and the impact of
regulatory measures on those market conditions". 3 That is correct but that does not mean that a

3 See, Panel Report, para. 7.2015.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

Member can deliberately reduce the distinctiveness of the trademark by prohibiting its use. In fact,
and demonstrating the failure of the Panel to read Article 16.1 in its context, the Panel itself finds
that the TRIPS Agreement (Article 20) prevents Members from imposing certain requirements
including a prohibition on the use of trademarks, unless it can be justified based on "good reasons".
Honduras considers that while the distinctiveness of the trademark may fluctuate according to
market conditions and the impact of regulatory measures on those market conditions, it is clear that
this does not mean that a Member is entitled to deliberately seek to reduce the distinctiveness of
the trademark by imposing encumbering requirements such as the prohibition on the use of
trademarks.
10. A good faith reading of Article 16.1 in the context of TRIPS Section 2 on trademarks and
Article 20 of the TRIPS Agreement and in the light of the object and purpose of this provision and of
the TRIPS Agreement as a whole reveals the flaws in the Panel's formalistic interpretation of
Article 16.1. The Panel failed to even begin to examine many of the terms used in Article 16.1. The
Panel's narrow textual reading of parts of this provision that does not take into consideration the
context and object and purpose of the words as used in Article 16.1 constitutes an error of law and
legal interpretation.
11. The prohibition on the use of the trademark unduly restricts the trademark owner's private
right to prevent unauthorised use of similar signs on similar products. Whether this restriction is
"limited" and thus permitted by Article 17 is the relevant question the Panel failed to examine.
12. Second, the Panel errs in its application of the law to the facts as it completely and deliberately
fails to address the relevant question at hand. The TRIPS Agreement imposes certain disciplines on
Members and requi res them to confer minimum private rights to intellectual property owners,
including trademark owners. The relevant question that the Panel failed to even examine is whether
a measure that prohibits the use of the trademark on the lawfully available produc t reduces the
distinctiveness of the trademark and thus its scope of protection such that the level of protection
falls below the minimum level that Members are required to guarantee under Article 16 of the
TRIPS Agreement. The Panel itself considers this to be the essential question, but then refuses to
examine it. By failing to apply the law to the facts, the Panel errs in law and as a result of this false
exercise of judicial economy also fails to comply with its obligation under Article 11 of the DSU.
13. For these reasons, Honduras requests the Appellate Body to reverse the Panel's relevant
findings in paragraphs 7.1966 -7.2030, 7.2031-7.2032, and 7.2051, and therefore to reverse and
declare moot and of no legal effect the Panel's finding paragraph 8.1(d) t hat Honduras has not
demonstrated that the TPP measures are inconsistent with Australia's obligations under Article 16.1
of the TRIPS Agreement.
IV. CLAIM 3: THE PAN EL'S INTERPRETATION OF THE TERM "TRADE -RESTRICTIVE" IN
ARTICLE 2.2 OF THE TBT AGREEMENT AND ITS APPLICATION TO THE FACTS OF THIS CASE
IS IN ERROR
14. Although Honduras agrees with the ultimate conclusion that the plain packaging measures are
trade restrictive, the Panel's interpretation of the term "trade -restrictive" in Article 2.2 of the
TBT Agreement and its application to the facts of this case is in error. In particular, the Panel makes
two separate but related errors of law.
15. First, the Panel erroneously rejects the notion that a modification or distortion of the conditions
of comp etition and a restriction of competitive opportunities for imported products is a "trade"
distortion. The Panel confirms that the plain packaging measures reduce product differentiation and
it acknowledges that plain packaging modified imported products' c onditions of competition and
affected their competitive opportunities. It also acknowledges that there is evidence that shows that
plain packaging has led to "down -trading" in favour of lower value products. But, erroneously, it
does not consider that this evidence of the measures' effect on the conditions of competition and
competitive opportunities suffices to establish a restriction on trade. The Panel unduly considered
that trade restrictiveness is not determined by the extent to which the measures modi fy the
conditions of competition and limit competitive opportunities for imported products, and instead
required evidence of a discriminatory modification of competitive opportunities to the detriment of
imported products. The Panel confused the requiremen ts of Articles 2.1 and 2.2 of the
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

TBT Agreement and unduly required evidence of discrimination to determine the trade -restrictive
nature of a technical regulation.
16. Second, the Panel erroneously finds that with respect to non-discriminatory measures, it does
not suffice to point to the measures' competition-distorting nature. According to the Panel, for non-
discriminatory measures, evidence must be adduced of the actual effect of the measures on prices
and sales in order to demonstrate that this distortion amounts to a restriction on trade. In so doing,
the Panel effectively introduces a "trade effects" test for measures that restrict trade but that are
not otherwise discriminatory. This is another error of law since it is well established that both
Article III of the GATT 1994 (on "National Treatment") and Article XI of the GATT 1994 (on the
"Elimination of Quantitative Restrictions") protect competitive opportunities and equality of
conditions of competition, without the need to demonstrate actual trade effe cts. These key
GATT 1994 provisions are functionally equivalent to Articles 2.1 and 2.2 of the TBT Agreement
respectively. The Panel erroneously imposed a higher evidentiary burden of demonstrating actual
trade effects with respect to "non -discriminatory" technical regulations. The Panel's distinction
between "discriminatory" and "non -discriminatory" measures for purposes of determining the
meaning of the term "trade-restrictive" and the evidence to be adduced is baseless and constitutes
an error of law. In error is also the Panel's related requirement that it be demonstrated that the
plain packaging measures actually reduced prices and sales of the product.
17. Honduras therefore requests the Appellate Body to modify and, where relevant, reverse the
Panel's findings in paragraphs 7.1166 -7.1168, 7.1196-7.1197, and 7.1255 – and thus to declare
moot and of no effect the Panel's findings in paragraph 8.1(a) that Honduras has not demonstrated
that the TPP measures are inconsistent with Australia's obligations under Article 2.2 of the
TBT Agreement.
V. CLAIM 4: THE PANEL ERRS IN LAW IN ITS APPLICATION OF THE LEGAL STANDARD
ON THE DEGREE OF CONTRIBUTION OF THE TPP MEASURES
18. The Panel may have correctly articulated the legal standard for determining the degree of
contribution of the challenged measures to the fulfilment of the legitimate objective, but it fails to
properly apply this standard to the facts of the case. The failure to properly apply the law to the
facts is an error of law, even if aspects of the Panel's ana lysis also support a claim of a failure to
make an "objective assessment" of the matter. Honduras' claim of error of law concerns
four separate but related claims concerning the findings of the Panel in respect of the determination
of the degree of contrib ution of the plain packaging measures to the fulfilment of the legitimate
objective.
19. First, the Panel correctly states that it is to examine the actual contribution of the measures
"to the fulfilment of the objective of reducing the use of tobacco products". However, the Panel errs
in its application of this standard to the facts before it since it does not in fact examine the actual
contribution of the measures to the legitimate objective of "reducing the use of tobacco products".
Instead, it examines the contribution of the measures to the specific "mechanisms" of reducing
appeal, increasing the effectiveness of health warnings and the reduction of the ability of tobacco
packaging to mislead consumers.4
20. Second, despite its statement that it must examine the "actual contribution" of the measures,
the Panel did not focus on the "actual impact" of the measures on the use of tobacco products.
Instead it included baseless speculation about an uncertain future impact of the measures "over
time" in light of unco rroborated statements about perceptions and intentions and without any
qualitative or quantitative projections supported by sufficient evidence.5
21. Third, the Panel correctly notes that the "broader context [of tobacco control in Australia] does
not remove or reduce the need to identify the contribution that the challenged measures themselves
make to Australia's objectives".6 However, it subsequently fails to correctly apply this test as it no
longer focuses on the "contribution that the challenged [plain pa ckaging] measures themselves"

4 This is clear from its findings which discuss the non-behavioural evidence at length (paragraphs 7.980-
7.986) before drawing unsupported conclusions on the behavioural effect of the measures in one paragraph
(paragraph 7.1025).
5 Panel Report, para. 7.1044.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

make. Instead it determines the degree of contribution of the measures in combination with and as
a component of a broader suite of complementary tobacco control measures. This is clear from its
finding that "the evidence befo re us supports the view that, as applied in combination with the
comprehensive range of other tobacco control measures maintained by Australia and not challenged
in these proceedings, including a prohibition on the use of other means through which branding
could otherwise contribute to the appeal of tobacco products and to misleading consumers about the
harmful effects of smoking, the TPP measures are apt to, and do, make a meaningful contribution
to Australia's objective of reducing the use of, and exposure to, tobacco products".7
22. Fourth, the Panel errs in its application of the legal standard it set for itself for examining the
evidence. This claim relates to a number of findings the Panel made which are not in line with the
legal standard it set for itself in this respect.
23. For example, the Panel correctly articulates the appropriate standard for examining the
evidence relating to the measures' contribution noting that it has a "duty… to 'evaluate the relevance
and probative force of each piece thereof'". 8 However, the Panel fails to apply this standard to the
facts and evidence of the case since it never properly evaluates the relevance and "probative weight"
of the different pieces of evidence effectively giving equal weight to all of the evidence. Its "totality
of the facts" approach includes evidence that is neither probative nor relevant such as the
pre-implementation studies which the Panel itself considers to have clear "limitations".
24. Furthermore, the Panel correctly articulates the relevant approach to the assessment of
"scientific evidence" when it states that "[t]o the extent that scientific evidence is relied upon, our
assessment may include in particular a consideration of whether such evidence 'comes from a
qualified and respected source', whether it has the 'necessary scientific and methodological rigor to
be considered reputable science' or reflects 'legitimate science according to the standards of the
relevant scientific community', and 'whether the reasoning articulated on the basis of the sc ientific
evidence is objective and coherent'". 9 However, it fails to correctly apply this legal standard for
approaching scientific evidence to the facts of the case since even evidence that clearly did not meet
the standard of scientific and methodological rigor was included in the Panel's analysis, for example
because it was the "only pre -implementation study submitted in these proceedings that sought to
investigate the impact of tobacco plain packaging on cigars and cigarillos" and that the Panel would
"therefore take its conclusions into account in our subsequent analysis".10
25. Finally, and despite its repeated statements about its approach to the econometric evidence
that would not involve the Panel undertaking its own econometric analysis, it did in fact do just that.
The Panel conducted its own (flawed) econometric assessment of the evidence as it developed
certain calculations and estimation methods that were never discussed with the parties and that
remain unexplained even in the Panel's own final report.11
26. Honduras acknowledges that there may be an overlap with the claims it is making under
Article 11 of the DSU relating to the lack of objective assessment of the matter. However, Honduras
requests that the failure to correctly apply the legal standa rd relating to the determination of the
degree of contribution of the measures to the facts of the case be considered as a stand-alone claim
of violation since it constitutes an error of law, irrespective of whether related errors of appreciation
of the evidence by the Panel may also be qualified as failure to "objectively" assess the matter.
27. Honduras therefore requests the Appellate Body to reverse the Panel's findings in
paragraphs 7.1024-7.1044, 7.1724-7.1732, and 7.2604 -7.2606 of the Panel Report, and thus to
declare moot and of no effect the Panel's findings in paragraph 8.1(a) that Honduras has not
demonstrated that the TPP measures are inconsistent with Australia's obligations under Article 2.2
of the TBT Agreement and in paragraph 8.1(e) that Hondur as has not demonstrated that the
TPP measures are inconsistent with Australia's obligations under Article 20 of the TRIPS Agreement.

7 Panel Report, para. 7.1043.
8 Panel Report, para. 7.517.
9 Panel Report, para. 7.516.
10 Panel Report, para. 7.622.
11 Panel Report, Appendix C, para. 107; Appendix D, paras. 44, 106, 109-110; Appendix E,
paras. 29-54.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

VI. CLAIM 5: THE PANEL ERRS IN LAW IN ITS INTERPRETATION AND APPLICATION OF
ARTICLE 2.2 OF THE TBT AGREEMENT WITH RESPECT T O THE AVAILABILITY O F LESS
TRADE-RESTRICTIVE ALTERNATIVE MEASURES
28. The Panel's findings relating to the proposed "less trade restrictive alternative measures"
reflect a number of errors of law and legal interpretation.
29. First, the Panel fails to examine whether the alternative measures are less "trade restrictive"
based on a correct interpretation of this term. Instead, the Panel erroneously concludes that the
proposed alternative measures are equally trade restrictive because they are at least equally
effective in reducing smoking. The Panel should have examined the restrictive effect of the proposed
alternatives on the conditions of competition of imported products in order to determine whether
the proposed alternatives were "less trade restrictive". The Panel's failure to do so vitiates its findings
on alternative measures.
30. Second, the Panel correctly articulates the legal standard for determining whether the
alternative measures provide an "equivalent" (but not necessarily an "identical") contribution and
correctly finds that "a proposed alternative measure may achieve an equivalent degree of
contribution in ways different from the technical regulation at issue". 12 However, the Panel errs in
its application of the law to the facts of this dispute.
31. In partic ular, (a) the Panel fails to examine the degree of contribution of the proposed
alternative measures in the light of the legitimate objective actually found to exist; (b) the Panel
erroneously requires that the alternative measures provide an identical contribution as a "substitute"
rather than an "equivalent" contribution; (c) the Panel errs by engaging in an asymmetrical
comparison that imposes a greater degree of contribution on the alternatives than required by the
"equivalence" test.
32. The Panel's finding that none of the proposed alternative measures are capable of operating
as a substitute for plain packaging is based on the erroneous comparison of the alleged contribution
of plain packaging in combination with the enlarged GHWs , on the one hand, with the alternative
measure as a substitute for both the plain packaging measures and the enlarged GHWs. This is
incorrect since the enlarged GHWs were never part of the dispute. To the extent that the Panel was
justified in considering the combined effect of the plain packaging measures with the enlarged GHWs,
it should also have examined the contribution of the alternative measures in combination with the
large GHWs covering 75% of the front of the pack and 90% of the back.
33. In addition, and related to the ab ove errors, the Panel errs in law when applying a different
standard for "equivalence" in the context of an alleged "suite of measures" and in making its findings
on the basis of an alleged lack of "synergies".
34. Honduras therefore requests the Appellate Body to reverse the Panel's findings in
paragraphs 7.1464, 7.1468-7.1471, 7.1531, and 7.1542-7.1545 – and thus to declare moot and of
no effect the Panel's findings in paragraph 8.1(a) that Honduras has not demonstrated that the
TPP measures are inconsistent with Australia's obligations under Article 2.2 of the TBT Agreement
as well as the related findings in paragraphs 7.2606 and 8.1(e) that Honduras has not demonstrated
that the TPP measures are inconsistent with Australia's obligations under Art icle 20 of the
TRIPS Agreement.
VII. CLAIM 6: THE PA NEL FAILS TO CONDUCT AN "OBJECTIVE ASSES SMENT" OF THE
MATTER, INCLUDING TH E EVIDENCE ON THE TP P MEASURES' CONTRIBUTION TO T HE
OBJECTIVE OF REDUCIN G THE USE OF TOBACCO PRODUCTS, IN VIOLAT ION OF
ARTICLE 11 OF THE DSU
35. The Panel's review of the evidence relating to the degree of contribution of the plain packaging
measures to the fulfilment of the legitimate objective of reducing smoking does not reflect the
required "objective assessment" of the matter and th e Panel thus acted in violation of Article 11 of
the DSU.

12 Panel Report, para. 7.1369.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

36. The Panel failed to make an objective assessment of the facts, as required under Article 11 of
the DSU, inter alia, because:
• The Panel failed to provide a reasoned and adequate explanation of how th e facts supported
the determination made that "plain packaging has resulted in a reduction in smoking
prevalence and in consumption of tobacco products";
• The Panel failed to examine the evidence in an even -handed manner, applying a double
standard of proof;
• The Panel ignored material pieces of evidence submitted by the complaining parties; and
• The Panel failed to respect the basic principles of due process and procedural fairness by
involving a "ghost expert" which developed criticisms of the parties' evidence that the parties
were never given an opportunity to comment on and which are never explained in the report
thus shielding them from proper scrutiny. The Panel could have, and in this case should have
appointed an expert of its own in consultation with the parties as provided for in Article 14.2
of the TBT Agreement and Article 13 of the DSU.
37. These failures of the Panel, taken individually and together, are of such a pervasive nature as
to cast doubt on the objectivity of the Panel in the context of thi s dispute which related to a
controversial product and a well -intended but unlawful, ineffective, and disproportionate measure.
The Panel thus failed to make an objective assessment of the evidence on the degree of contribution
of the plain packaging measures in violation of its obligation under Article 11 of the DSU.
VII.1 The Panel fails to provide a reasoned and adequate explanation of how the facts
before it supports a conclusion that the TPP measures were apt to, and do, make a
meaningful contribution to their legitimate objective
38. The Panel makes the ultimate finding that the TPP measures are not more trade restrictive
than necessary because, inter alia, they "are apt to, and do make a meaningful contribution" to their
public health objective by reduci ng the use of, and exposure to, tobacco products in Australia. 13
However, a review of the facts before the Panel, when examined in light of the evidentiary standard
and approach adopted by the Panel in this dispute, reveals that there simply is no basis in the facts
to support this conclusion. The Panel has thus failed to provide the required reasoned and adequate
explanation that the facts support the determination made. In particular:
• The Panel's own limited findings on actual behaviour do not support this conclusion;
• The Panel's own findings on the proximal and distal outcomes (i.e. on perceptions, attitudes
and intentions) do not warrant such a conclusion, even assuming that these proximal and
distal outcomes are informative of actual behaviour; and
• The Panel's own findings on the literature and behavioural science theories do not support this
finding, even assuming the literature and underlying surveys and theories are informative of
actual behaviour.
39. There was simply no positive evidence in the sense of relevant and probative evidence showing
that the TPP measures actually contributed to their objective. Relatedly, the Panel failed to provide
"reasoned and adequate explanations" and "coherent reasoning" for its unsupported findings.
40. The Panel also fails to explain how it is possible that it finds no evidence of a contribution to
the "distal" outcomes such as quitting attempts or cognitive processing of the risks of smoking after
three years of plain packaging but nevertheless concludes that there is evid ence that less people
smoke and that people smoke less because of plain packaging. The Panel never acknowledges, let
alone explains the gap in the analytical framework which was proposed by Australia and which was
apparently accepted by the Panel. The Pane l bases its finding on actual contribution on the
econometric analysis presented by Australia's expert of one of many datasets without explaining this

13 Panel Report, para. 7.1725(b).
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

conclusion in the light of plausible alternative explanations and contradictory facts it has itself
established.
41. Furthermore, the Panel states that it needs to evaluate the relevance and "probative value"
of the different pieces of evidence but in fact fails to do as it gives equal weight to all evidence as
part of its flawed "totality of the facts" approach. In particular, the Panel fails to provide an adequate
explanation for why it includes certain pre-implementation studies that are so obviously flawed that
they should not have been included and relies on studies and behavioural theories even when the
facts do not support them. The Panel fails to provide an explanation of why such studies and theories
are relevant as part of the totality of facts if they have not been supported by the empirical evidence
that the Panel itself considered essential for taking these studies into account.
42. In addition, the Panel asserts that "the impact of the TPP measures may evolve over time",14
but fails to support this speculative assertion with the necessary "quantitative projections into the
future or qualitative reasoning based on a set of hypotheses that are tested and supported by
sufficient evidence" that it itself acknowledged to be required. 15 Taking into consideration that the
evidence submitted covered a period of almost three years of a measure that was planned to have
met its objective over a six year period (i.e. reducing prevalence to 10% by 2018), and in light of
the fact that there was no basis to assume that the measures' contribution would become visible
only over time, the unsupported suggestion that the measures' cont ribution would further evolve
over time remains unexplained and is pure speculation.
43. The Panel's finding on cigars are particularly disconcerting since there is a close to total lack
of evidentiary basis for the Panel's conclusions that the plain packagin g measures are apt to, and
actually do, contribute to the reduction in the use of cigars. The Panel's conclusions relating to all
tobacco products, including cigars, are not supported by the facts on the record and there is
no reasoned and adequate explanation of the Panel's findings on cigar smoking.
44. At a more granular level, the Panel jumps to conclusions without any apparent explanation,
let alone an adequate and reasoned explanation of why it disregards certain pieces of evidence and
considers others t o be probative. Therefore, even the intermediate findings that the Panel makes
are not the result of a reasoned and adequate explanation. For example, it merely states 23 times
that it conducted a "careful review" before simply repeating the arguments of A ustralia's experts
without reflecting, let alone addressing, the different rebuttal arguments made by the experts of the
complainants with respect to the probative nature of the evidence presented.
45. The Panel notes a number of limitations about the reliability and relevance of numerous pieces
of evidence relied on by Australia but still takes this evidence into account as part of its "totality of
facts" approach. It fails to explain which of the many pieces of evidence examined it considered to
be relevant and probative or what value it attaches to evidence that ostensibly fails to meet the
standard of "scientific evidence" that it articulates. The Panel's analysis of the evidence is not "critical
and searching" as it simply notes the weaknesses of the evidence in isolation without doing anything
with these weaknesses. It fails to examine the evidence in a holistic manner and it never conducts
a critical analysis of the entirety of the evidence considered in combination. Nor does the Panel
provide a reasoned and adequate explanation why the alleged flaws in the evidence submitted by
the complainants on consumption and prevalence were of such nature that it justified disregarding
these analyses completely. The Panel accepts all of Australia's evidence, even if it has acknowledged
flaws and limitations but "zeroes" out all of the complainants' evidence as soon as it allegedly is not
perfect without providing the required adequate explanation.
VII.2 The Panel disregards and thus misrepresents material pieces of evidence presented
by the complainants
46. The Panel disregards and misrepresents the complainants' evidence as it completely omits the
important rebuttal points made by its experts to the criticism of Australia which the Panel effectively
simply adopts as its own. In addition, the Panel quotes the conclusions of the experts out of their
context, highlights alleged admissions without even reflecting the explanations of the experts that
put these alleged admission in their proper context. The extent to which the Panel disregarded and

14 Panel Report, para. 7.1044.
15 Panel Report, para. 7.982.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

thus distorted the complainants' expert evidence on contribution is pervasive, as evidenced in an
Annex to this submission.
47. Honduras notes in particular the unexplained disregard by the Panel of the evidence presented
by Professor Klick both in terms of demonstrating the lack of contribution of the measures and for
purposes of rebutting the criticisms expressed by Australia's experts related to his analysis and
evidence which includes the only "ideal" longitudinal pre/post analysis th at was presented in this
dispute. By not acknowledging let alone addressing the points made by the complainants' experts
to rebut the criticisms of their own evidence or for purposes of criticising Australia's evidence, the
Panel failed to undertake an objective assessment that does not skew the analysis in favour of either
of the parties.
VII.3 The Panel's analysis lacks even-handedness and reflects a double standard of proof
48. The Panel's assessment of the facts reveals a lack of even-handedness and the application of
a double standard of proof at various levels.
49. First, the Panel's "totality of the facts" approach operated as a technique of wiping out the
acknowledged individual flaws of Australia's pre-and post-implementation evidence which the Panel
considered to form a "body of evidence". In contrast, each individual concern, including numerous
purely hypothetical or possible minor concerns relating to the evidence presented by the
complainants formed the basis for completely disregarding the complainants ' evidence. The many
expert reports prepared by high -calibre experts recognised as such in their respective fields and
related evidence presented by the complaining parties was never considered to form a "body of
evidence" because of alleged minor individual flaws affecting such evidence, thus "zeroing" much of
the complainants' evidence. The double standard is clear.
50. Second, the Panel permitted Australia to allocate the combined effects of plain packaging and
GHWs to the plain packaging measures while requiring the complainants to effectively demonstrate
that neither provided any contribution whatsoever, even though the complainants did not challenge
the large GHWs. This is most evident in the context of the Panel's analysis of the proposed alternative
measures which the Panel refused to examine in combination with the GHWs. In so doing, the Panel
effectively required that the alternative measure provide not only an equivalent contribution to plain
packaging but in fact an equivalent contribution to plain packaging in combination with the enlarged
GHWs. If the Panel considered that it was not possible to separate the effects of plain packaging
from the effects of the enlarged GHWs that were introduced at the same time, an even -handed
assessment would also ha ve examined the alternatives assuming they would be applied in
combination with the enlarged GHWs. The Panel failed to undertake such an objective and even -
handed analysis.
51. Third, the Panel rejects the complainants' evidence and a number of its econometri c models
mainly because they reveal that under certain conditions the evidence shows a statistically significant
increase in smoking rather than a decrease. The Panel cannot accept a conclusion that is not
consistent with the conclusion it expects to find. Furthermore, the Panel errs in its appreciation of
the concept of "statistical significance", and as a result blames the complainants for failing to
establish with certainty that the measures are not working, while not requiring similar certainty from
Australia. However, it does not allow the complainants to conservatively reach this conclusion based
on an evident effect in the opposite direction. The Panel is consistently giving the benefit of the
doubt to Australia.
52. Finally, the Panel's ghost expert ide ntified certain "robustness" concerns relating to the
evidence submitted by the complaining parties such as the problem of "multi -collinearity" for
example. The Panel rejects a lot of the complainants' evidence on the basis of this newly developed
concern that Australia never raised. In addition to the fact that the Panel was thus clearly making
the case for Australia, it also and importantly fails to examine if the same "robustness" concern does
not also affect the evidence of Australia's experts. The Pane l is deliberately looking for flaws in the
complaining parties' evidence but omits to examine, let alone apply a similarly strict approach to
Australia's evidence.
53. In sum, the Panel's treatment of the evidence reflects a "double standard of proof" in its
consideration of the qualitative and quantitative evidence. The Panel effectively gives a zero to every
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

piece of evidence presented by the complainants that it considers not to be perfect; however, in
contrast, the Panel accepts the combined presentation o f obviously flawed pieces of evidence
presented by Australia as probative of a certain degree of contribution by the plain packaging
measures even if each of these pieces of evidence individually does not meet the standard set by
the Panel in terms of scie ntific and methodological rigour. It uses the combined effect of plain
packaging in combination with the enlarged GHWs as the starting point and assigns the combined
effect to plain packaging while not assigning any possible effects of GHWs to the measures that are
proposed as alternatives to plain packaging for example. The Panel raises novel robustness concerns
with respect to the evidence presented by the complainants without even examining if the same
robustness concerns apply equally to the evidence of Australia. This difference in approach is evident
and is not in line with the requirement to conduct an even-handed examination. The double standard
of proof is clear.
VII.4 The Panel fails to respect the due process rights of the parties
54. The Panel conducted its own analysis of the very technical evidence that was submitted even
though, objectively speaking, it did not possess the necessary technical skills for doing so. The Panel
did not share with the parties any of the questions or concerns it had with respect to the technical
evidence that was submitted and never confronted the parties with its own alternative analysis which
was critical to its conclusions on the evidence. The Panel did not appoint an expert of its own in
consultation with the parties in line with the authority given to it under Article 14.2 of the
TBT Agreement and Article 13 of the DSU. Instead, it relied on a ghost expert to re-do the analysis
of the parties and to find alleged flaws that even the parties did not identify. In addition, it shielded
such criticisms from scrutiny by the parties during the proceeding and even to date by not disclosing
the manner in which it reached certain conclusions based on its "re -working" of the "back-up" data
provided by the parties. In so doing, the Panel failed to respect the parties' due process rights.
55. Honduras considers that the Panel's discretion to appoint experts under Article 13 of the DSU
and Article 14.2 of the TBT Agreement is not boundless. If, as was the case here, the arguments are
of such a technical and fundamental nature, the Panel was effectively under a requirement to appoint
an expert. Furthermore, the failure of the Panel to do so meant that the parties were not in a position
to respond to a number of the (misguided) criticisms that the Panel independently developed through
its ghost expert. This failure to give the parties an opportunity to address new points raised for the
first time in the interim report, and that were never included in any of the more than 200 questions
the P anel posed, adversely affects the fundamental due process rights of in particular the
complainants. In developing these new points of criticism, the Panel was effectively making the case
for Australia, and the Panel was doing so in secret with the assistance of a ghost expert rather than
by appointing an expert of its own through a transparent and objective process.
56. These errors, when examined individually as well as in combination with each other,
demonstrate the lack of objective assessment of the Panel's assessment of the evidence relating to
the degree of contribution of the measures, thus violating Article 11 of the DSU. For that reason as
well, the Panel's findings on the degree of contribution should be reversed.
57. Honduras therefore requests the Appel late Body to reverse the Panel's findings on the
evidence on the degree of contribution of the measures as reflected in the Appendix and in
paragraphs 7.1024-7.1045 of the Panel Report as such findings were not the result of an objective
assessment of the matter by the Panel in violation of Article 11 of the DSU and thus to declare moot
and of no effect the Panel's findings in paragraph 8.1(a) that Honduras has not demonstrated that
the TPP measures are inconsistent with Australia's obligations under Articl e 2.2 of the
TBT Agreement and the related findings in paragraphs 7.2606 and 8.1(e) that Honduras has not
demonstrated that the TPP measures are inconsistent with Australia's obligations under Article 20 of
the TRIPS Agreement.
VIII. CONCLUSION
58. For the reasons stated in Honduras' Appellant Submission, and based on the errors of law and
legal interpretation as well as the lack of objective assessment that vitiate the relevant findings of
the Panel, Honduras respectfully requests the Appellate Body to reverse and declare moot and of
no effect the Panel's findings as set out in this submission by:
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

• finding that the Panel erred when it found in paragraph 8.1(e) that Honduras has not
demonstrated that the TPP measures are inconsistent with Australia's obligatio ns under
Article 20 of the TRIPS Agreement;
• finding that the Panel erred when it found in paragraph 8.1(d) that Honduras has not
demonstrated that the TPP measures are inconsistent with Australia's obligations under
Article 16.1 of the TRIPS Agreement;
• finding that the Panel erred when it found in paragraph 8.1(a) that Honduras has not
demonstrated that the TPP measures are inconsistent with Australia's obligations under
Article 2.2 of the TBT Agreement; and
• finding that the Panel failed to make an objectiv e assessment of the matter in violation of
Article 11 of the DSU.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX B-2
EXECUTIVE SUMMARY OF THE DOMINICAN REPUBLIC'S APPELLANT'S SUBMISSION
INTRODUCTION
1. On 1 December 2012, Australia introduced the tobacco plain packaging ("TPP") measures.
These measures ban all design features on tobacco retail packaging and tobacco products
themselves, and branding of any kind on cigarette sticks, in an attempt to reduce smoking.
2. The Dominican Republic did not lightly decide to challenge the TPP measures. Nor has it lightly
decided to maintain that challenge on appeal. The Dominican Republic recognizes that any legal
challenge to a tobacco control measure will be met with scepticism.
3. Yet, the value of WTO dispute settlement is that the adjudicator must make its decision on an
objective basis. Over several decades, panels and the Appellate Body have rightly earned a
reputation for basing decisions on a transparent and rigorous review of reliable evidence, with judges
of the International Court of Justice ("ICJ") praising the WTO as establishing "best practice".1
4. In bringing this dispute to the WTO, the Dominican Republic did not seek to constrain
Australia's legitimate right to protect public health by reducing smoking. Indeed, before the P anel,
the Dominican Republic showed that the TPP measures do not achieve their objective to reduce
smoking and proposed that Australia could adopt alternative, stringent tobacco control measures
with a proven track record. In particular, Australia could ra ise the minimum legal purchase age
("MLPA") to 21 years and it could increase taxes. As the Panel acknowledged, these measures are
universally accepted, including by the World Health Organization, to be effective at reducing
smoking, particularly among young people.
5. Whilst respecting Australia's prerogative to take measures to reduce smoking, the
Dominican Republic turned to the WTO in an effort to preserve the competitive opportunities that
could flow from the display of trademarks, geographical indications ("GIs"), and other design
features on the residual parts of the packaging, left after respecting the Graphic Health Warning
("GHW") requirements.
6. The Panel agreed that these features create competitive opportunities through brand
differentiation, which "engenders consumer loyalty and increases consumers' willingness to pay". 2
As the Panel found, "the TPP measures limit the opportunity for tobacco manufacturers to compete
on the basis of such brand differentiation".3
7. It is well-known that many developing countries resisted the legal protections for intellectual
property that developed nations insisted upon in the Uruguay Round negotiations, skeptical of the
benefits that the protection of such rights could bring to their economies.
8. Yet, the protection of trademarks and GIs has taken on considerable importance to the
Dominican Republic now that it has transformed itself from an exporter of unprocessed tobacco leaf
into the world's leading producer and exporter of premium branded cigars. This remarkable
transformation occurred in no small part due to the ability of its producers to develop well -known
brands with a reputation for quality and consistency.
9. The Panel rejected each of the Dominican Republic's claims in its Report in Australia – Certain
Measures Concerning Trademarks, Geographical Indications and Other Plain Packaging
Requirements Applicable to Tobacco Products and Packaging ("Panel Report").4

1 Pulp Mills Case, Joint Dissent of Judges Al-Khasawneh and Simma, para. 16.
2 Panel Report, para. 7.1167.
3 Panel Report, para. 7.1167.
4 Panel Report, para. 8.1.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

10. The Dominican Republic is disappointed with the Panel's findings. The Dominican Republic had
always recognized that a dispute of this type could be influenced by adverse attitudes about the
product. Yet, the Dominican Republic trusted that a WTO panel would undertake its assessment with
the usual standards of objectivity for which the WTO dispute settlement system is justly renowned.
The Dominican Republic's disappointment stems from its conviction that the Panel did no t act with
such objectivity.
11. The claims that the Panel lacked objectivity are important not only to the Dominican Republic,
but also, in its view, to the WTO system. The Dominican Republic remains of the view that the value
of the WTO, as a forum for disp ute settlement, lies in its willingness and capacity to undertake an
objective review of difficult and sensitive international disputes. This appeal is designed to preserve
that systemic value.
12. The claims of lack of objectivity focus, in part, on the process that the Panel followed in
summarily rejecting the Dominican Republic's econometric evidence. The Panel developed and
executed its own detailed econometric tests; it wrote its own computer code to operate the tests
and then ran the tests on the data for itself; and it referred to the results of its work as "evidence".5
The Dominican Republic had no opportunity to be heard on considerations that were decisive in
rejecting its evidence. This manner of proceeding is not consistent with the dictates of objectivity –
fair and independent decision-making consistent with due process.
13. Other claims of lack of objectivity concern the Panel's inconsistent treatment of the evidence
and incoherent reasoning. To illustrate, the Panel rejected the Dominican Republic's evidence
because it was affected by a particular issue, yet it accepted Australia's evidence, even though it
was affected by the same issue. In reaching such conclusions, the Panel failed to reconcile
contradictory parts of its own reasoning, and also failed to reconcile its reasoning with contradictory
evidence in its record.
14. The Panel, in this case, has strayed beyond the realms of fair and independent adjudication
not once or twice, but repeatedly. Below, in this introduction, we set out two examples that provide
a snapshot of the lack of objectivity that runs throughout the Panel's assessment. In the sections
that follow, we provide an overview of the remaining claims.
15. Alongside appeals regarding the Panel's objectivity, the Dominican Republic makes distinct
appeals regarding the interpretation and application of the law. The Panel found that, by design, the
TPP measures restrict competitive opportunities that "engender […] consumer loyalty and increase
[…] consumers' willingness to pay".6 However, for the Panel, these restrictions do not amount to a
"restriction" on international trade under Article 2.2 of the Agreement on Technical Barriers to Trade
("TBT Agreement").
16. It suggests that this is because the TPP measures are non-discriminatory. For such measures,
the complainant must prove the actual "effects" of the alleged restriction, taking account of the
impact on both consumers and suppliers, and their respective responses to the measures. The
Panel's finding is contrary to long -standing case law that WTO obligations protect competitive
opportunities and that a complainant need not prove actual trade effects in the marketplace.
17. The Dominican Republic proposed less restrictive alternative measures, including raising the
MLPA to 21 years, and increasing taxes. The Panel found that these alternatives would not be less
trade-restrictive than the TPP measures and would not make an equivalent contribution to Australia's
objective, under Article 2.2 of the TBT Agreement. This is despite the fact that the Panel considered
that these two alternatives were just as effective in reducing smoking, which is Australia's objective,
and the fact that they would not reduce the competitive opportunities that arise from differentiating
tobacco products with branding. The alternatives did not, however, make an equivalent contribution
to the TPP measures because they did not work through the same means or mechanism as the
TPP measures, namely, by reducing the appeal of tobacco packaging and products. However,
according to well-established case law, the equivalence of a contribution must be assessed in light
of a measure's objective, and not the mechanism it uses to achieve that objective. The Panel has
wrongly confused the means and the end.

6 Panel Report, para. 7.1167.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

18. The TPP measures prohibit the display of word marks on cigarette sticks, whereas they permit
the display of word marks on tobacco packaging and cigar sticks. The Dominican Republic claimed
that the prohibition on the use of word marks on cigarette sticks was contrary to Article 20 of the
Agreement on Trade-Related Aspects of Intellectual Property Rights ("TRIPS Agreement"). The Panel
failed to examine this part of the Dominican Republic's claims, thereby failing to respect its terms of
reference.
19. Finally, the Dominican Republic has also exercised care in asking the Appellate Body to
complete the analysis. For the most part, should the Appellate Body uphold a ground of appeal, the
Dominican Republic does not ask the Appellate Body to complete the analysis. The
Dominican Republic recognizes that the Appellate Body is generally cautious in so doing and requires
a clear record of uncontested facts or factual findings. For the most part, there is no such record to
which the Dominican Republic could, in good faith, direct the Appellate Body.
A. Example (1): the Panel's own development of a "non-stationarity" test
20. The first example concerns one of the detailed econometric criteria that the Panel developed
on its own, namely " non-stationarity", which the Panel used to reject certain of the compl ainants'
econometric evidence. For the time being, we leave to one side the substance of what this
econometric concept means, and focus simply on the Panel's process.
21. Before reading the Panel Report, the Dominican Republic's team of government officials and
outside lawyers had never heard of the term "non-stationarity", and had no idea what it meant. The
reason is that the concept of "non -stationarity" had never been discussed with the parties during
the briefing phase of the panel proceedings, which lasted one and a half years. The concept did not
arise in the parties' 50 -plus submissions to the Panel or in the 20 -plus expert econometric reports
submitted by the parties. The Panel met twice with the parties and their experts, and the Panel
posed a total of 207 written questions to the parties. Yet, the Panel did not, at any time, ask a single
question about "non -stationarity". For its part, Australia had never suggested that the
Dominican Republic's econometric evidence was flawed because of "non -stationarity", even though
it made many submissions on that evidence and identified many other econometric criticisms.
22. Yet, the Panel rejected the Dominican Republic's econometric evidence – but not Australia's –
because of "non-stationarity" concerns that the Panel had identified by itself, using an econometric
test that the Panel had developed and executed on its own , without giving the parties any
opportunity whatsoever to comment.
23. As a result, the Dominican Republic was deprived of an opportunity to comment on important
issues such as: the relevance of this test to the facts, how the test should be applied, how the results
of the test should be interpreted, and whether the models could easily be adjusted to resolve a
perceived "non-stationarity" problem. Suffice it to say that these issues are consequential.
24. First, "non-stationarity" and its partner "stationarity" are not always relevant in econometric
analysis. The relevance of the test and the interpretation of the results depend on the circumstances.
25. Second, if the circumstances suggest that non-stationarity might indeed be relevant, there is
no standard way to test for it. Among the many tests available, three different tests are often used
to test for non -stationarity, with the different tests potentially l eading to different results. To run
any one of the tests, a researcher must write computer code that will implement the test, and the
researcher must then allow a computer to run the test on the dataset.
26. Third, after running the tests, a researcher must decide how to interpret the results generated
to decide if they indicate a "non-stationarity" problem or not. To assist with interpreting the results,
a researcher may need to run additional econometric tests, using new computer code, to establish
whether there is, in fact, a "non-stationarity" issue.
27. The way in which the Panel developed and executed the "non-stationarity" tests, including for
example the computer code it used, and the results its test generated, are not described in the
Panel Report, and are not part of the Panel's record.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

28. The Dominican Republic is shocked that a WTO panel would deem it appropriate to take it
upon itself to develop and execute a detailed econometric test along these lines, and reject
one party's evidence on that basis, without any input whatsoever from the parties.
29. This is not simply a question of who did the underlying work and whether they were properly
appointed to do so. It is rather a fundamental denial of due process rights, which lie at the heart of
any fair and indepe ndent dispute resolution system. It is simply not fair and independent for an
adjudicator to: develop and execute an econometric test on its own, without the issue ever being
raised by any party; use that test to reject one party's evidence; and, deprive t hat party of any
opportunity to comment on the adjudicator's own test.
30. The same two ICJ judges who praised the WTO for establishing "best practice" in its treatment
of evidence rebuked the ICJ for its reliance on "ghost experts". They observed that recours e to
"ghost experts" deprives the adjudicative process of "transparency, openness, procedural fairness,
and the ability for Parties to comment upon or otherwise assist the Court in understanding the
evidence before it". 7 The ICJ's use of "ghost experts" ha s also drawn considerable criticism in
academic literature for the same reasons.8
31. At the same time that the Panel deprived the Dominican Republic of its due process rights, it
"made the case" for Australia. It developed and executed a detailed econometric test that Australia
had never even mentioned, much less asserted as part of its "case". Yet, the Panel's own econometric
test became an important part of its finding that the TPP measures were not inconsistent with
Australia's WTO obligations. In using its own econometric test in this way, the Panel has strayed far
beyond reasonable, fair, and independent adjudication.
32. The Panel seems to assume that Australia's econometric models do not have a "non -
stationarity" problem because of the modeling technique used. However, the Panel does not indicate
whether it tested that assumption by applying the same "non-stationarity" test to Australia's models.
When the three different "non-stationarity" tests commonly used are applied to Australia's models,
they generate the same results as they do when applied to the Dominican Republic's evidence. Yet,
the Panel accepted Australia's models, at the same time it rejected the Dominican Republic's. This
unexplained inconsistent treatment of the evidence underscores the fundamental due process issue.
33. Had the Dominican Republic been granted its due process right to comment on "non -
stationarity" in the econometric evidence:
• it could have addressed issues, such as:
o the relevance of this concept;
o how to test for it, including how to run follow-up testing; and,
o how to write appropriate computer code to run the test;
• it could have provided evidence, with computer code, testing its own and Australia's evidence
for "non-stationarity", ensuring that all of the materials and re sults constitute evidence of
record; and,
• it could have addressed:
o how to interpret the results of testing;
o whether follow-up testing is needed and, if so, how to conduct that testing, and the results
of that testing;
o how to adjust models to account for "non-stationarity"; and,
o whether the overall modeling results are valid, despite possible "non-stationarity" issues.
34. For both the Dominican Republic's and Australia's models, the results of Dominican Republic's
"non-stationarity" testing using the three commonly -used methods suggest – in both cases – that
follow-up testing is needed to establish if there is a non -stationarity issue. The results of that
follow-up testing suggest, in both cases, that non-stationarity is not an issue. It is impossible for the

7 Pulp Mills Case, Joint Dissent of Judges Al-Khasawneh and Simma, para. 14.
8 See e.g. Kate Parlett, "Parties' Engagement with Experts in International Litigation", Journal of
International Dispute Settlement, 2018, 1-13, p. 6
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

Dominican Republic to know whether the Panel conducted any follow -up testing and, if so, how it
ran that follow-up testing, and what the results of that testing were.
35. The Dominican Republic does not ask the Appellate Body to decide if the evidence is, or is not,
affected by "non -stationarity". The appeal focuses on the Panel's process in assessing
"non-stationarity", which was conducted in a vacuum, without respecting the Dominican Republic's
due process right to be heard. Had the Dominican Republic been given an opportunity to comment
on "non-stationarity", it could have addressed all these issues.
36. The Panel's shocking approach to "non -stationarity" may be contrasted with the approach
taken to the same issue by the Arbitrator in US – COOL.9 In that case, as the Dominican Republic's
team has subsequently learned, the Arbitrator explored "non-stationarity" with the parties: it asked
them questions about the issue; it allowed them to submit evidence on the topic; it allowed them to
adjust models to resolve perceived concerns over "non -stationarity"; and it even relied on
econometric models with a "non-stationarity" problem because the problem did not render the model
results invalid. In short, the Arbitrator respected due process, and acted with fairness and
independence.
B. Example (2): the Panel's contradictory reliance on a consumption model that was
by Australia's own account "nonsensical"
37. A second example of a lack of objectivity illustrates the inconsistent treatment of the evidence,
coupled with incoherent and inadequate reasoning. In assessing whether the TPP measures reduced
smoking, the parties and the Panel agreed that it was important to take into account the impact on
smoking of increases in Australia's excise taxes. It is universally accepted that, when taxes increase,
smoking declines.
38. In the relevant period, Australia raised excise taxes several times. With the agreement of the
parties, the Panel found that any econometric assessment of whether the TPP measures had reduced
smoking must control for excise tax increases. 10 This "tobacco costliness" control seeks to ensure
that the TPP measures are not wrongly credited with a drop-in smoking that is, in reality, attributable
to an excise tax increase.
39. With respect to the Dominican Republic's models, the Panel applied this control strictly. It
uniformly rejected Dominican Republic models where the tobacco costliness control did not show a
statistically significant decline in smoking in response to increased costliness.11
40. The Panel did not apply the same strict standard to Australia's econometric models. Late in
the proceedings, Australia submitted a model that purported to show that the TPP measures had led
to a reduction in cigarette consumption. Australia's model tried to control for each of the three large
excise tax increases that took place in the relevant period, including an increase of 12.5 percent in
December 2013. However, Australia's model found that this tax increase had led to a statistically
significant increase in cigarette consumption.
41. In other words, according to this model, people bought more cigarettes when tobacco taxes
went up by 12.5 percent. Earlier in the proceedings, Australia's own expert had rightly described
such a modeling result as "nonsensical".12
42. Because Australia's evidence was filed late in the proceedings, the Dominican Republic was
granted special leave to explain this "nonsensical" result in Australia's model. The
Dominican Republic explained that this result drove the model's finding that the TPP measures
reduced consumption. In short, the TPP measures were wrongly credited with a drop -in smoking
that was attributable to the 12.5 percent excise tax increase. The Dominican Republic thus brought
to the Panel's attention an issue which the Panel found of fundamental importance when it addressed
the Dominican Republic's evidence, namely, whether a model is able to detect (correctly) the impact
of tobacco costliness.

9 Decision by the Arbitrator, US – COOL (Article 22.6 – US), paras. 5.61 and 6.37.
10 Panel Report, Appendix C, paras. 103-105.
11 Panel Report, Appendix C, paras. 103-105.
12 Chipty Rebuttal Report, (Exhibit AUS-535) (SCI), para. 39.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

43. How did the Panel assess Australia's "nonsensical" evidence, and th e Dominican Republic's
rebuttal? The Panel found that the TPP measures had led to a decline in cigarette consumption. The
only evidence cited by the Panel to support this finding was Australia's consumption model with the
"nonsensical" finding that a 12.5 percent tax increase had led to a statistically significant increase
in cigarette consumption.13
44. In doing so, the Panel never even mentioned that Australia's model produced a "nonsensical"
result, even though the Dominican Republic had alerted the Panel to this result in a special
submission devoted exclusively to this issue. The Dominican Republic's submission was not
mentioned, let alone addressed.
45. In contrast, the Panel certainly mentioned each instance in which a Dominican Republic model
failed to find a statistically significant decline in smoking in response to increased taxes/costliness.
Any such evidence from the Dominican Republic was uniformly rejected. The Panel, however,
entirely failed to reconcile this contradictory treatment of Australian and Dominican Republic models.
46. The Panel's assessment of Australia's "nonsensical" model also strays beyond the realms of
reasonable, independent, and fair adjudication.
47. These are just two examples of the Panel's failure to conduct an objective assessment, but
they illustrate the Panel's lack of objectivity in assessing the facts, which consistently redounded to
Australia's advantage. In the next sections, the Dominican Republic explores these examples in more
detail, together with many other instances of the Panel's lack of objectivity.
48. In the sections that follow, we provide a summary of the Dominican Republic's claims in
relation to the Panel's assessment, under Article 2.2 of the TBT Agreement, of the contribution of
the TPP measures to Australia's objective; the trade-restrictiveness of the TPP measures; and, the
availability of less trade -restrictive alternatives. We then address our claims related to the Panel's
findings under Article 20 of the TRIPS Agreement.
II. THE PANEL ERRED IN FINDING THAT THE TPP MEASURES CONTRIBUTE TO
AUSTRALIA'S OBJECTIVE
49. The Dominican Republic appeals the Panel's finding that the TPP measures are apt to, and do,
contribute to Australia's objective of reducing the use of, and exposure to, tobacco products.14
50. As the Panel explained, "the TPP measures [were] intended to operate on the basis of a 'causal
chain model'", acting first on "proximal" outcomes, including the appeal of tobacco packaging, then
on more " distal" outcomes, such as quit -related intentions, and, finally, on actual smoking
behaviours, as depicted in the "causal chain" below.15

51. The fulfilment of the objective of the TPP measures was "predicated on their ability to influence
smoking behaviours" themselves. Accordingly, the Panel highlighted the importance of assessing the
actual impact of the TPP measures on smoking behaviours in Australia based on evidence from the
period after the implementation of the measures ("post-implementation" evidence).16
52. In light of the predicted "causal chain", the Panel also assessed two additional categories of
evidence: the anticipated impact of the TPP measures based on evidence from the period before the
implementation of the TPP measures ("pre-implementation evidence"); and, the actual impact of the

13 Panel Report, Appendix D, para. 117; and Chipty Third Rebuttal Report, (Exhibit AUS-605), p. 53.
15 Panel Report, para. 7.488.
16 Panel Report, para. 7.495. (emphasis in the original)
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

TPP measures on proximal and distal outcomes based on post-implementation evidence regarding
these outcomes.17
53. Based on its assessment of these three categories of evidence, the Panel reached its overall
conclusion th at "the evidence before us, taken in its totality, supports the view that the
TPP measures, […], are apt to, and do in fact, contribute to Australia's objective of reducing the use
of, and exposure to, tobacco products".18 Having reached this finding, the Panel also considered that
it was "reasonable" to expect that the TPP measures may be expected to have an impact in the
future.19
54. In the sections that follow, the Dominican Republic summarizes its claims regarding each of
these categories of evidence. To fac ilitate, the Panel's findings with respect to each category, and
the corresponding ground of appeal, are visualized in Figure 1, below.
Figure 1: The structure of the Dominican Republic's appeal

A. The Panel erred in assessing post-implementation evidence on the actual impact of
the TPP measures on smoking behaviours
55. The Dominican Republic's first ground of appeal concerns the Panel's failure to make an
objective assessment of the post-implementation evidence concerning the actual impact of the
TPP measures on cigarette and cigar smoking prevalence and consumption.

17 See e.g. Panel Report, 7.983. The post-implementation evidence shows the combined effects of the
TPP measures and the enlarged GHWs, because they were introduced on the same day (i.e. 1 December
2012).
18 Panel Report, para. 7.1025. See also paras. 7.1037, 7.1039, 7.1043, 7.1045.
19 Panel Report, para. 7.1044.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

56. The Dominican Republic and Australia presented competing post-implementation evidence on
the actual impact of the TPP measures on cigarette and cigar smoking behaviours – i.e. prevalence
and consumption – in Australia.
57. The Panel rejected the Dominican Republic's evidence that the TPP measures had not affected
prevalence and consumption for cigarettes and cigars because of perceived flaws in that evidence.
It accepted Australia's evidence that the TPP measures had (i) reduced cigarette and cigar smoking
prevalence; and (ii) reduced cigarette consumption. 20 The Panel found that the evidence did not
allow it to reach a conclusion regarding cigar consumption.21
58. In reaching this finding, the Panel failed to make an objective assessment under Article 11 of
the DSU in relation to the evidence on the benchmark rate of decline in smoking (i.e. the trend),
and to the robustness criteria used by the Panel to assess the parties' evidence.
1. The Panel's errors related to the benchmark rate of decline
a. The Panel erred in its assessment of the benchmark rate of decline for cigarette
 smoking prevalence
59. The parties agreed that there was a declining trend in smoking prevalence in Australia before
the introduction of the TPP measures that continu ed after their introduction. 22 The parties also
agreed that it was necessary to control for this pre -existing "benchmark rate of decline" (trend) in
estimating the impact of the TPP measures using econometric models.23
60. The Dominican Republic's experts demon strated that the benchmark rate of decline
accelerated after 2006, and controlled for this acceleration by including a trend break in 2006. 24
Australia's expert asserted that the benchmark rate of decline in smoking was unchanged between
2001 and 2015, and used a single constant linear trend in her models.25
61. This disagreement about the correct benchmark rate of decline was important, because it had
a decisive impact on the parties' estimates of the actual impact of the TPP measures on smoking
prevalence in Australia. For example, when the accelerated post -2006 rate of decline is applied to
Australia's prevalence models, these models no longer show a reduction in smoking prevalence
attributable to the TPP measures.26
62. The Panel agreed that it was important to ac count for the long -standing declining trend in
smoking to avoid attributing to the TPP measures a decline resulting from the trend.27 It decided to
proceed in a three-step analysis of cigarette smoking prevalence, examining: first, "whether smoking
prevalence has decreased following the implementation of the TPP measures"; 28 second, "whether
the reduction of smoking prevalence has accelerated following [TPP] implementation";29 and, third,
whether any acceleration identified in step 2 was attributable to the TPP measures.30
63. At each of these three steps, without acknowledgment or explanation, the Panel adopted a
different benchmark rate of decline, with the rate used progressively decelerating at each step
(i.e. becoming flatter):

20 Panel Report, Appendix C, paras. 55, 102, 103-108, 111, 118, 119 and 123(c); and Appendix D,
paras. 44, 106-108 and 109-114, 137(c).
21 Panel Report, Appendix D, para. 137(d).
22 Chipty Second Rebuttal Report, (Exhibit AUS-591), para. 11; and IPE Third Updated Report,
(Exhibit DOM-375), paras. 32-40.
23 Chipty Third Rebuttal Report, (Exhibit AUS-605), para. 39; and IPE Third Updated Report,
(Exhibit DOM-375), para. 40.
24 See e.g. IPE Third Updated Report, (Exhibit DOM-375), paras. 49, 55, 59 and 65.
25 Chipty Third Rebuttal Report, (Exhibit AUS 605), paras. 3(d), 35.
26 IPE Third Updated Report, (Exhibit DOM-375), Table 2.1-2.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

o In step 1 , the Panel agreed with the Dominican Republic that the rate of decline had
accelerated in 2006.
o In step 2, the Panel applied a different – flatter – benchmark rate of decline that fails to
account for the 2006 acceleration in the rate of decline found in step 1.
 The Panel's step 2 trend line was presented in Figure C.19, which was developed by the
Panel itself and is not part of the Panel record.31 On interim review, Australia informed the
Panel that the Panel had wrongly attributed this figure to Australia's expert. T he
Dominican Republic has been unable to reproduce this figure.
o In step 3, the Panel adopted a third benchmark rate of decline, this time the one used by
Australia's expert, which was even flatter than the rate used in step 2, and also failed to
account for the 2006 acceleration in the rate of decline found in step 1.
64. In Figure 2, the Dominican Republic shows the three different trend lines used by the Panel:
Figure 2: Benchmark rate of decline found in steps 1 to 3

65. The flatter the trend line used immediately before the TPP measures were implemented (black
vertical line), and the higher the prevalence rate at that time (the intercept of the trend lines and
the vertical black line), the more likely it is to find a TPP effect by comparison with the actual data
in the post-implementation period.
66. Thus, the Panel's progressive flattening of the rate of decline made it more likely that it would
find, in step 2, that the rate of decline in cigarette smoking prevalence accelerated after introduction
of the TPP measures; and, more likely that it would find, in step 3, that the TPP measures had
contributed to reducing cigarette smoking prevalence. As noted, had the Panel consistently used the
green trend line, found in step 1, it would have found no TPP effects. In its finding on the trend lines,
the Panel did not conduct an objective assessment of the evidence under Article 11 of the DSU.32
67. First, as a result of the Panel's failure, in steps 2 and 3, to adopt the benchmark rate of decline
that it established in step 1, the Panel's reasoning was "internally incoherent".33 The Panel's findings

31 Panel Report, Appendix C, Figure C.19.
32 Appellate Body Report, US – Continued Zeroing, para. 338.
33 Appellate Body Report, Argentina – Import Measures, footnote 543 to para. 5.179.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

in steps 2 and 3 "[did] not follow logically" from its finding, in step 1, that the rate of decline had
accelerated in 2006.34 The Panel did not acknowledge or explain this incoherence in its Report.
68. Second, the Panel did not, in step 2, "provide reasoned and adequate explanations" for its
findings. 35 Instead, it made findings that "lack a basis in the evidence contained in the panel record",
adducing its own evidence in Figure C.19, that it initially attributed – incorrectly – to Australia.36
Neither the Panel Report nor the Panel Record explain how the Panel produced Figure C.19.
69. The Panel also compromised the Dominican Republic's due process rights because it did not
"explore" Figure C.19 with the parties. 37 Had the Dominican Republic been allowed to comment, it
would have explained that Figure C.19 is mis-specified because it fails to account for the trend
acceleration in 2006, as the Panel found in step 1. Finally, in relying on its own evidence in step 2,
the Panel "ma[d]e the case" for Australia.38
b. The Panel erred in its assessment of the benchma rk rate of decline for smoking
 prevalence in relation to cigars
70. In their econometric models relating to cigar smoking prevalence, the parties also controlled
for the benchmark rate of decline in smoking. The Dominican Republic's expert explained that, for
cigar smoking, the data not only shows an acceleration of a downward trend in 2006 (similar to
cigarette smoking prevalence), but also a directional change in the trend in 2006: it went from an
upward sloping trend until 2006 (an increasing rate of smokin g), to a downward sloping trend
thereafter (a decreasing rate of smoking). The Dominican Republic's expert controlled for this trend
break in 2006. Australia's expert did not and, instead, used a constant linear trend from
2001-2015.39
71. As with cigarette pr evalence, this difference was critical to the Panel's finding, based on
Australia's model, that the TPP measures had reduced cigar smoking prevalence.40 In reaching this
finding, the Panel failed to objectively assess the benchmark rate of decline, in violation of Article 11
of the DSU.
72. First, the Panel failed to engage with evidence that was relevant to its reasoning, and of
importance to the Dominican Republic's case. The Dominican Republic provided evidence showing
that Australia's model was mis-specified because it failed to account for the "obvious and marked"
2006 trend break. 41 However, the Panel accepted Australia's results without addressing the
Dominican Republic's evidence.
73. Second, the Panel's treatment of the parties' competing evidence was "intern ally
inconsistent".42 In the context of cigarette smoking prevalence, the Panel rejected the complainants'
models if they did not find a statistically significant effect of the trend on prevalence, because it
considered this result "at odds" with the agreed existence of a pre -TPP decline in prevalence. 43 In
contrast, in the context of cigar smoking prevalence, the Panel accepted Dr Chipty's model even
though it did not find a statistically significant effect of the trend.44 The Panel provided no explanation
for this inconsistency.

34 Appellate Body Report, Colombia – Textiles, paras. 5.27 and 6.2.
35 Appellate Body Report, US – Upland Cotton (Article 21.5 – Brazil), footnote 618 to para. 293.
36 Panel Report, Appendix C, Figure C.19; and Appellate Body Report, EC and certain member States –
Large Civil Aircraft, (Article 21.5 – US), para. 5.146.
37 Appellate Body Report, US – Large Civil Aircraft (2nd complaint), para. 1137.
38 Appellate Body Report, EC and certain member States – Large Civil Aircraft (Article 21.5 – US),
para. 5.221; Appellate Body Report, EC – Fasteners (China), para. 566; and Appellate Body Report,
US – Continued Zeroing, para. 343.
39 IPE, Updated Report, (Exhibit DOM-303); IPE Third Updated Report, (Exhibit DOM-375);
IPE Summary Report, (Exhibit DOM-379), paras. 115-119; and Chipty Surrebuttal Report, (Exhibit AUS-586),
paras. 58-60.
40 Panel Report, paras. 7.972(c), 7.986, 7.1037; and Appendix C, paras. 122, 123(c).
41 IPE Third Updated Report, (Exhibit DOM-375), para. 83.
42 Appellate Body Report, Argentina – Import Measures, footnote 543 to para. 5.179.
44 Panel Report, Appendix C, paras. 120-122; and Chipty Surrebuttal Report, (Exhibit AUS-586),
Table 8.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

2. The Panel's errors related to robustness criteria used by the Panel to assess the
parties' evidence
74. The second category of error in the Panel's assessment of the post -implementation evidence
on the actual effects of the TPP measures on prevalence and consumption relates to the robustness
criteria it used to assess the parties' econometric evidence. The Panel's errors do not arise from the
selection of robustness criteria, but from its failure to apply those criteria objectively. The Panel's
assessment lacked objectivity for a catalogue of reasons, including a failure to respect the
Dominican Republic's due process rights and a failure to apply the criteria in a coherent and even -
handed manner.
75. The Panel's failure to make an objectiv e assessment applies to robustness criteria that the
Panel developed and executed itself, without giving the parties any opportunity to comment, as well
as to criteria that were the subject of some exchange with the parties.
a. The Panel's errors related to robustness criteria not debated with the parties
76. The Panel failed to make an objective assessment regarding two robustness criteria that the
Panel developed and executed itself, without any involvement of the parties. The first robustness
criterion that the Panel developed itself concerns the econometric concept of "non-stationarity". The
Dominican Republic has already addressed "non-stationarity" in the introduction above.
77. The second robustness criterion that the Panel developed itself concerns the econometric
concept of " multicollinearity". The Panel defined multicollinearity as arising "when two (or more)
explanatory variables convey the same information".45
78. Instead, the Panel itself identified multicollinearity as an issue, without the parties ever raising
it. The Panel developed and executed testing for multicollinearity on its own (using the so -called
"variance inflation factor" ("VIF") test statistic); it wrote and ran computer code to implement its
chosen test; and, it interpreted the results, and determined the consequences of those results. The
Panel referred to the results of its work as "evidence", although none of this "evidence" is part of
the Panel's record.
79. The Panel undertook all of this work in a vacuum, without giving the parties any opportunity
to comment.
80. The Panel found that the Dominican Republic's models were affected by multicollinearity, and
rejected them on this basis. 46 It asserted that Australia's models were not affected by
multicollinearity and relied on them. For similar reasons to those given regarding non -stationarity,
the Panel failed to make an objective assessment under Article 11 of the DSU in assessing
multicollinearity.
81. First, the Panel violated the Dominican Republic's due process rights by failing to afford it "a
meaningful opportunity to comment".47 Had the Dominican Republic been granted an opportunity to
comment, it could have addressed, for example, the circumstances in w hich multicollinearity is
problematic; how to test for multicollinearity; and, whether multicollinearity was a problem in the
parties' models.
82. Second, the Panel treated the "same class of quantitative evidence" inconsistently.48 The Panel
found Australia's prevalence models to be unaffected by multicollinearity, although it gave no
supporting information.49 It said nothing at all about whether Australia's consumption models are
affected by multicollinearity. There is also nothing in the Panel record to confi rm whether and how
the Panel tested Australia's models.
83. The Dominican Republic has replicated the Panel's analysis of multicollinearity, using the
VIF test statistic. The results show that several of Australia's prevalence and consumption models

47 Appellate Body Report, US — Tuna II (Article 21.5 – Mexico), para. 7.177.
48 Appellate Body Report, US – Upland Cotton (Article 21.5 – Brazil), paras. 294-295.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

are affected by multicollinearity. Australia's models thus "suffered from the same limitation" that led
the Panel to reject the Dominican Republic's models.50 Had the Dominican Republic been granted its
due process rights, it could have presented this analysis to the Panel.
84. Third, the Panel failed to provide "reasoned and adequate explanations" for its finding.51 With
the Panel Report in hand, the Dominican Republic is uncertain how the Panel assessed
multicollinearity – for example, whether and how it tested Australia 's models, and, if so, what the
results were.
85. Fourth, the Panel "ma[d]e the case" for Australia. 52 Australia never mentioned, much less
asserted, multicollinearity as part of its "case". By developing testing for multicollinearity, which was
used to reject the Dominican Republic's models, the Panel developed its own line of evidence and
argument that served Australia's case.53
b. The Panel's errors related to robustness criteria debated with the parties
86. In relation to the evidence on smoking prevalence and c onsumption, the Panel also failed to
assess objectively robustness criteria that had been the subject of some exchange with the parties.
The Panel erred in its application of four criteria relating to: tobacco costliness, reweighting,
endogeneity, and the proportionality assumption. Tobacco costliness was addressed as an example
in the introduction above.
i. Reweighting
87. When a researcher uses survey data to estimate the impact of a policy intervention on a
population (like the TPP measures on the Australian population), s/he must ensure that the dataset
is representative of the underlying population. As demographic changes to the underlying population
occur, data providers periodically reweigh the surveyed sample to ensure that it remains
representative, and a researcher must control for these reweighting events.
88. The Panel recognized the importance of reweighting for correctly estimating the actual impact
of the TPP measures on smoking prevalence in the Roy Morgan Single Source ("RMSS") dataset. 54
The Panel also found that the parties controlled for reweighting events in the RMSS dataset. 55
However, the Panel rejected the robustness of the Dominican Republic's controls for those
reweighting events in the RMSS dataset, while accepting the robustness of Australia's. In so doing,
the Panel failed to undertake an objective assessment of the matter.
89. The Panel's finding that Australia's evidence was "robust" to reweighting involved inconsistent
treatment of the parties' evidence.56 The Panel's errors relate to the fac t that the Panel found that
Australia's evidence was robust to reweighting, despite the fact that the models on which Australia
relied, and which were accepted by the Panel, were affected by issues that the Panel found
problematic when present in the Dominican Republic's evidence.
90. First, the Panel accepted Australia's evidence when Australia's expert, Dr Chipty, relied on a
model submitted by the Dominican Republic's expert, Professor List, that controlled for reweighting
events. The Panel had rejected the robustness of the very same model when presented by
Professor List.
91. Second, the Panel accepted Dr Chipty's evidence relying on Professor List's model that
controlled for reweighting, despite the fact that Dr Chipty relied on an intermediate specification that
did not control for the declining trend in smoking. However, the Panel elsewhere insisted that the
complainants' models were not acceptable if they did not control for the declining trend in smoking.

50 Appellate Body Report, US – Upland Cotton (Article 21.5 - Brazil), para. 292.
52 Appellate Body Report, EC and certain member States – Large Civil Aircraft (Article 21.5 – US),
para. 5.221.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

92. Third, the Panel treated the parties' evidence inconsistently in relation to multicollinearity. On
the one hand, the Panel rejected the Dominican Republic's models when they controlled for
reweighting, on the view that reweighting increased multicollinearity.57 On the other hand, the Panel
accepted Dr Chipty's models when she controlled for reweighting, despite the fact that all of her
models were also affected by multicollinearity, and that, for each model, reweigh ting increased
multicollinearity.
93. Moreover, the Panel's reasoning regarding the treatment of reweighting events in the parties'
evidence was "internally incoherent". 58 The Panel "recognize[d] the importance of attempting to
control" for reweighting, and co nsidered it important that Australia's prevalence results were
"robust" to controlling for reweighting.59 However, the Panel ignored that Dr Chipty's models did not
"attempt […] to control" for all four reweighting events in the RMSS dataset.
ii. Endogeneity
94. As one of the criteria used to assess the econometric robustness, the Panel assessed whether
the models are affected by "endogeneity". Endogeneity can arise where the TPP measures
(indirectly) affect smoking by impacting other variables (such as price) that are included as controls
in the models. 60 The Panel expressed concern that, were such an "indirect" effect on smoking to
occur (i.e. TPP measures → change in price → change in smoking), it would not be attributed to the
TPP measures but to the price.
95. The issue of endogeneity relates, therefore, to the way the parties' models controlled for
tobacco costliness. The parties disagreed how to control for tobacco costliness in their prevalence
and consumption models. Three different approaches were discussed : (i) price (using retail prices,
which account for tax and non -tax changes in price); (ii) tax levels (which account for all tax
changes, but not for non-tax changes in price); and, (iii) tax dummies (which account solely for the
three major tax hikes adopted by Australia in 2010, 2013, and 2014).
96. The Panel explained that the price control has the advantage of "account[ing] implicitly for all
the factors that affect tobacco price, including the excise tax increases but not only that", but, unlike
tax levels and tax dummies, potentially raises an endogeneity problem (because the TPP measures
may affect price).61
97. The Panel, therefore, rejected the Dominican Republic's models which used a price control. It
accepted Australia's models because, by using tax dumm ies, they avoided a potential endogeneity
problem.62 In so doing, the Panel failed to make an objective assessment of the matter, in violation
of Article 11 of the DSU.
98. The Panel treated the "same class of quantitative evidence" in an internally inconsistent way.63
First, the Panel credited Australia, but not the Dominican Republic, for avoiding endogeneity in any
models that used a non -price control (i.e. tax dummies or tax levels). 64 The Dominican Republic
submitted several models that used tax dummies and tax levels, but these were also rejected.
Second, the Panel dismissed the Dominican Republic's evidence that used a price control – but not
Australia's – because of a potential endogeneity problem.65 Australia submitted model specifications
that used price (instead of tax dummies or tax levels), and the Panel relied on them.66
99. The Panel also failed to provide "reasoned and adequate explanations" for its finding that the
Dominican Republic's experts did not address "the potential impact of the TPP measures on prices".67
To the contrary, for endogeneity reasons, the Dominican Republic's experts presented models that

58 Appellate Body Report, Argentina – Import Measures, footnote 543 to para. 5.179.
62 Panel Report, Appendix C, paras. 107 and 120; and Appendix D, paras. 106 and 115.
63 Appellate Body Report, US – Upland Cotton (Article 21.5 – Brazil), para. 294.
66 Chipty Second Rebuttal Report, (Exhibit AUS-591), Table 5, Row [B]; and List Third Supplemental
Report, (Exhibit DOM/IDN-7), Table 5.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

used tax dummies and tax levels – and not price – and still found no TPP effect on smoking. As the
experts explained, these results demonstrated that the TPP measures did not affect smoking through
price, and that models using a price control were not affected by endogeneity. 68 The Panel did not
reconcile its statement that the Dominican Republic did not address "the potential impact of the
TPP measures on prices" with this evidence and argument.
iii. Proportionality assumption
100. In cigarette consumption models, the Panel also considered how to control for tobacco
costliness. The Dominican Republic had p resented models that used tax levels (and price) as a
control, while Australia used only tax dummies. The Panel acknowledged that when tax levels –
instead of tax dummies – are used, there is no TPP effect on consumption, even in Australia's
models.69 Tax l evels accounted for all tax increases, whereas tax dummies accounted for only
59 percent of those increases.
101. However, the Panel concluded that the use of tax levels was inappropriate. Tax levels assume
proportionality between the size of a given tax increase and the impact of that increase on tobacco
consumption.70 The Panel accepted Dr Chipty's assertion that thi s so -called "proportionality
assumption" did not hold in this case.
102. The Panel, therefore, rejected the Dominican Republic consumption models that used tax
levels.71 In so doing, the Panel failed to provide "reasoned and adequate explanations" for this
finding, in violation of Article 11 of the DSU.72
103. Dr Chipty's assertion that the proportionality assumption did not hold was based on her own
cigarette consumption model. However, as the Dominican Republic explained above, this model
produced " nonsensical" resu lts, showing that a 12.5 percent increase in tax, in 2013, led to a
statistically significant increase in consumption.
104. The Panel did not "explain how it reconciled" its acceptance of Dr Chipty's assertions regarding
the proportionality assumption, using he r "nonsensical" consumption model with the
Dominican Republic's contrary "rebuttal arguments and evidence". These showed that Dr Chipty's
assertions that the proportionality assumption did not hold were a direct consequence of her
"nonsensical" tax result.73
B. The Panel failed to make an objective assessment of the pre -implementation
evidence on the anticipated impact of the TPP measures
105. The Dominican Republic's second ground of appeal concerns the Panel's failure to assess
objectively the pre-implementation evidence concerning the anticipated impact of the TPP measures.
For several reasons, taken individually and collectively, the Panel acted inconsistently with Article 11
of the DSU.
106. The pre-implementation evidence sought to predict the potential effects of the TPP measures.
The evidence included the pre -implementation "TPP literature", along with research based on
behavioural theory, expert opinion, and industry documents.
1. The Panel failed to make an objective assessment of the matter in relation to the
evidence and argument on the appeal of tobacco products prior to the implementation of
the TPP measures
107. The parties presented evidence and argument on whether the TPP measures coul d be
expected to have an effect on the appeal of tobacco products, and, if so, whether a change in appeal
could be expected to carry through to actual smoking behaviours. To recall, reduced pack appeal
was one of three "proximal outcomes" ("mechanisms") through which Australia's TPP measures were

68 IPE Third Updated Report, (Exhibit DOM-375), para. 64.
70 Panel Report, Appendix D, paras. 106 and 116.
72 Appellate Body Report, US – Upland Cotton (Article 21.5 – Brazil), footnote 618 to para. 293.
73 Appellate Body Report, EC and certain member States – Large Civil Aircraft, para. 918.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

hypothesized to influence more distal outcomes (e.g. quit-related intentions) and ultimately smoking
behaviours.74
108. The context for the parties' arguments was Australia's so -called "dark market", in which
traditional advertising of tobacco products was prohibited, 75 and large GHWs were displayed on
packaging, both before and after the TPP measures were implemented.76
109. According to Australia, the TPP measures would reduce appeal and, ultimately, reduce
smoking, by reduci ng consumers' "positive perceptions" of tobacco products, especially in a dark
market.77
110. The Dominican Republic explained that Australia's assertion depended on the existence of
positive perceptions before the TPP measure were introduced. However, data collected by Australian
anti-tobacco entities demonstrated the exact opposite: before the TPP measures were introduced,
Australian youth and adults had negative perceptions regarding partially branded Australian packs,
with large GHWs.78
111. The Dominican Republic also demonstrated that the relationship that Australia predicted
between pack appeal and smoking behaviours was not supported by pre-implementation consumer
behavior: brands described as highly appealing to Australian youth had no Australian consumers,
while the most smoked brands in Australia were among the least appealing to young and adult
Australians.79
112. The Panel predominantly assessed pre -implementation evidence that was not specific to
Australia. It concluded that tobacco packaging "may be used, and has in fact been used, to generate
positive perceptions of tobacco products", and that plain packaging would reduce the appeal of
tobacco products.80 The Panel also found that it was "reasonable to hypothesize some correlation"
between reduced appeal and smoking behaviours in a context where packaging provided the "only
opportunity to convey a positive perception".81 In reaching these findings, the Panel failed to make
an objective assessment in at least two ways.
113. First, despite making over 20 intermediate f indings about supposed positive consumer
perceptions of tobacco packaging, the Panel nowhere engaged with the Dominican Republic's
evidence that: (1) before the TPP measures, Australians already had negative perceptions about
partially branded packs with large GHWs; and (2) there was no relationship between brand appeal
and smoking in Australia.82
114. Second, the Panel's reasoning was "incoherent". In finding that plain packaging would succeed
by changing positive perceptions about tobacco packaging, the Panel emphasized the importance of
the Australian context.83 However, the Panel failed to reconcile this finding with the only evidence
on the record addressing perceptions about tobacco packaging in the Australian context prior to the

74 See section II, above.
75 Panel Report, footnote 1338 to para. 7.450; for advertising, see Panel Report, 2.56-2.60 and 2.67.
76 GHWs covered 30 percent of the front face and 90 percent of the back face of tobacco packaging prior
to the TPP measures, and 75 percent and 90 percent, respectively, afterwards (Panel Report,
paras. 2.53-2.55).
77 Panel Report, paras. 7.670 and 7.848; and Australia's first written submission, paras. 152 and 182.
78 Dominican Republic opening oral statement at the second substantive meeting with the Panel;
Dominican Republic's comments on Australia's response to question No. 170 from the Panel following the
second substantive meeting, para. 273; White et al. 2015a, (Exhibits AUS-186, DOM-235), p. ii43; and
ASSAD 2011 Report, (Exhibit DOM-360), p. 115 and 257.
79 Dominican Republic's comments on Australia's response to question No. 160, para. 280;
Dominican Republic's response to Panel question No. 108, paras. 143 and 144, referring to Parr et al. (2011a),
(Exhibits AUS-117, JE-24(49)), p. 43 and White and Bariola (2012), (Exhibit DOM-227), p. 19;
Dominican Republic's second written submission, para. 254; and Dominican Republic's comments on Australia's
80 Panel Report, paras. 7.663 (emphasis added), 7.682, and 7.778.
82 Appellate Body Report, EC and certain member States – Large Civil Aircraft, paras. 918-920.
83 Panel Report, para. 7.1034.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

TPP measures, which was the Dominican Republic's evidence that partially branded packs, with large
GHWs, already conveyed negative perceptions.
2. The Panel failed to assess objectively whether the "anticipated effects" of the
TPP measures were confirmed by the "actual effects"
115. The parties agreed that it was essential to assess whether the effects anticipated in the
pre-implementation evidence were borne out by actual effects in the post-implementation period.84
The parties disagreed, however, on whether the predictions in the pre -implementation evidence
were confirmed in the post-implementation evidence.
116. Australia submitted that the pre-implementation TPP literature correctly predicted the actual
effects of the TPP measures in Austral ia. The Dominican Republic submitted that this literature
"vastly overstated" the effects actually arising from the TPP measures. The Panel failed to make an
objective assessment of the parties' evidence and argument.
117. The Panel assessed whether the predic ted impact was borne out by the actual impact only
with regard to the appeal of tobacco products. The Panel found that the actual effects on appeal
"confirm[ed], rather than discredit[ed]" the predicted effects.85 On the other hand, the Panel did not
similarly verify whether the predicted impact on other proximal outcomes (GHWs, and deception)
and on distal outcomes (e.g. quit intentions, quit attempts) were confirmed in the actual effects of
the TPP measures. More generally, the Panel did not address whethe r the actual effects confirmed
the hypothesis that the TPP measures would set in motion the predicted chain of effects (proximal
outcomes → distal outcomes → smoking behaviour).
118. The Panel's failure to adopt a "coherent" approach to its assessment of this c ausal chain is
particularly problematic because the Panel failed to verify precisely those variables, including
variables closer to smoking behaviour (i.e. distal outcomes), for which the predicted effects were
not confirmed in the post-implementation evidence.
3. The Panel failed to make an objective assessment of the cigar-specific evidence
119. The Parr et al 2011b study, commissioned by Australia, was the only pre -implementation
study to examine the anticipated impact of plain packaging on cigar smoking.86 This study suffered
from serious methodological flaws, some of which the authors themselves admitted.87
120. The Panel acknowledged the study's scientific flaws, yet relied on the study.88 In so doing, the
Panel failed to make an objective assessment of the matter, as required by Article 11 of the DSU.
121. First, the Panel failed "to provide reasoned and adequate explanations" for accepting Parr et
al. 2011b.89 The Panel stated that the authors provided "relevant" reasons for the flaws in their
study, which all related to practical considerations, such as time constraints. 90 The Panel failed,
however, to explain why practical considerations, or the admission of such flaws, can overcome
scientific flaws. The evidence remains flawed in terms of scientific method.
122. Second, the Panel treated competing evidence inconsistently. 91 For instance, the Panel
accepted Parr et al. 2011b despite significant confounding factors in the study. The Panel was
satisfied because these confounding factors resulted from practical considera tions. Yet, the Panel
rejected evidence submitted by the complainants when practical considerations led to confounding
factors.

84 Dominican Republic's comments on Australia's response to Panel question No.196, para. 573.
86 Panel Report, para. 7.622.
89 Appellate Body Report, US – Upland Cotton (Article 21.5 – Brazil), footnote 618 to para. 293.
90 Panel Report, para. 7.622.
91 Appellate Body Report, Argentina – Import Measures, footnote 543 to para. 5.179.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

C. The Panel erred in assessing the post-implementation evidence on the actual impact
of the TPP measures on proximal and distal outcomes
123. The Dominican Republic's third ground of appeal concerns the Panel's failure to make an
objective assessment of the post-implementation evidence concerning the actual impact of the
TPP measures on proximal and distal outcomes.
124. In addition to providing post -implementation evidence on the actual impact on smoking
prevalence and consumption, the parties submitted post-implementation evidence on the impact of
the TPP measures on proximal outcomes (i.e. appeal, GHWs, and deception mechanisms) and distal
outcomes closer to smoking behaviour (e.g. intentions, quit attempts).

125. The parties considered this evidence relevant to show whether the TPP measures had set in
motion the causal chain through which the Panel expected the measures t o reduce smoking
(proximal outcomes → distal outcomes → smoking behaviour). Australia had, for instance, funded a
National Tobacco Plain Packaging Tracking Survey ("NTPPTS"), which was designed to evaluate
whether the TPP measures were bringing about chang es at each step in the causal chain. A series
of papers were published regarding the NTPPTS and other post -implementation datasets in which
the authors concluded that the TPP measures were working as intended through the causal chain.
126. At the Panel's request, the Dominican Republic was given access to the NTPPTS dataset and
certain other data, as well as computer codes used by the authors of the published papers.92 Based
on the data provided, the Dominican Republic showed that the TPP measures had not set in motion
the predicted causal chain, and that the published TPP papers "provide an inaccurate picture of the
empirical evidence", including "greatly underreporting" results that showed no impact of the
TPP measures.93
127. Yet, the Panel concluded that the TPP measures (combined with enlarged GHWs) have "in fact
reduced the appeal of tobacco products" and had "some impact on the effectiveness of GHWs".94 In
its conclusion, the Panel made no reference to the evidence on other proximal outcomes or the distal
outcomes – of which there were many – for which there were no positive TPP effects.
128. For a variety of reasons, individually and collectively, the Panel failed to make an objective
assessment, as required by Article 11 of the DSU.
1. The Panel findings on proximal and distal outcomes are incoherent
129. The Panel's findings in relation to proximal and distal outcomes were incoherent. First, the
Panel made findings that were incoherent with its findings that it was necessary to assess the
successive links in the causal chain, and that it was not sufficient to consider proximal outcomes
alone.95
130. The Panel, and the parties, recognized the need to adopt a holistic approach to assessing the
evidence on each successive link in the causal chain. 96 The Panel specified that proximal outcomes
"alone would not be sufficient to draw conclusions about the contribution of the TPP measures to

92 Panel paras. 1.78-1.100.
93 Ajzen et al. Data Report, (Exhibit DOM/IDN-2), para. 9.
94 Panel Report, 7.1036.
96 See e.g. Panel Report, paras. 7.488, 7.491, 7.519, 7.580, 7.610, 7.648, 7.684, and 7.1030.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

their public health objective", and that the impact of the TPP measures "depends on successive 'links
in the [causal] chain'".97
131. However, the Panel did not carry out a holistic assessment of the links in the causal chain. It
instead adopted an atomistic assessment of each individual proximal and distal outcome. In reaching
its overall finding, it then relied on the limited evidence of "positive" outcomes, and did not take into
account the remaining evidence of "negative" outcomes that showed no TPP effects. This "positive"
evidence concerned certain proximal outcomes (appeal and a few GHW outcomes). However, this
"positive" evidence was not considere d holistically with the "negative" evidence for other proximal
outcomes (other GHW outcomes, deception, smoking enjoyment) and for all distal outcomes. This
remaining evidence showed that the limited positive effects on proximal outcomes had not carried
through to any other outcomes, including those closer to smoking. 98 As the "enjoyment" outcome
showed, consumers found their pack less appealing, but they still enjoyed smoking just as much.
132. Second, the Panel's summary of the impact of the TPP measures on di stal outcomes is not
faithful to the Panel's own findings. The Panel failed to acknowledge that, for the two distal outcomes
for which an initial TPP effect was found (i.e. calls to the Quitline and avoiding plain packs), that
effect wore out within a year.
2. The Panel erred in assessing the robustness of the parties' evidence
133. The pattern of the Panel's errors with respect to its assessment of the evidence on proximal
and distal outcomes mirrors the errors relating to its assessment of the evidence on prevalence and
consumption, discussed above. As with its assessment of prevalence and consumption, the Panel
failed to adopt a process that respected the parties' due process rights, and it failed to assess the
evidence in a coherent and even-handed manner.
134. For instance, the Panel failed to make an objective assessment of the parties' evidence on
calls to the Quitline. Without posing any question during the proceedings, the Panel identified several
flaws in the analysis by the Dominican Republic's expert, Ajzen et al, of calls to the Quitline. The
parties did not raise, or have any opportunity to address, the critiques identified by the Panel. For
example, the Panel developed its own graphical analysis, incorrectly presenting Ajzen et al's
econometric model. The parties were never able to comment on this analysis, which suffers from an
obvious flaw. Had the Dominican Republic been granted its due process rights, it could have
addressed the Panel's critique.99
135. The Panel also treated the parties' evidence inconsist ently by not addressing whether the
published TPP paper on which Australia relied (Young et al 2014) was subject to the "same
[perceived] limitation[s]" as Ajzen et al.100 In fact, Australia's evidence displays the same perceived
flaws that the Panel identified in Ajzen et al. Yet, the Panel accepted Young et al 2014, without any
critique.
136. Finally, the Panel "made the case" for Australia. Australia did not assert, as part of its case,
that Ajzen et al was affected by any of the critiques identified by the Panel.
3. The Panel failed to make an objective assessment in finding that the datasets are
less suited to measuring the impact on distal outcomes
137. At the outset of the proceedings, Australia relied on published TPP papers examining
Australia's datasets (e.g. NTPPTS) to assert that the TPP measures were working though the "causal
chain" as intended in respect of proximal and distal outcomes.101
138. However, given access to the datasets and the computer code used by the authors of the
TPP papers, Ajzen et al found th at the TPP measures led to very few changes in distal outcomes,
and that none of these changes lasted even a year. Australia's data, therefore, showed that

97 Panel Report, paras. 7.564 (emphasis added), 7.693, and 7.699.
98 Panel Report, paras. 7.963(b), 7.1036 and 7.1043; Appendix A, paras. 30-31, 68, 84, and 86(b);
and, Appendix B, paras. 40, 59, 71-72, 75, 91, 100, 103, and 120.
99 Appellate Body Report, US – Continued Zeroing, para. 347. (emphasis added)
100 Appellate Body Report, US – Upland Cotton (Article 21.5), para. 292.
101 Ajzen et al. Data Report, (Exhibit DOM/IDN-2).
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

TPP measures had failed to set in motion the predicted causal chain. 102 In response, Australia
asserted that its datasets were not actually suited to assessing distal outcomes.103
139. The Panel did not explicitly address the suitability of the datasets. However, in reaching a
conclusion on distal outcomes, it said that the NTPPTS data "may […] be more suited" to analysing
proximal outcomes "than more distal outcomes", in part because survey questions were not put to
"recent quitters".104 This finding is not based on an objective assessment of the matter, as required
by Article 11 of the DSU.
140. First, the Panel failed to engage with the Dominican Republic's contrary evidence showing that
the datasets were not "less suited" to assessing distal outcomes.105 The Dominican Republic pointed
out that Australia's dataset designers decided to measure, and the authors of the TPP papers decided
to report on, the TPP impact on distal outcomes. Neither the designers nor the authors – who
overlapped – ever suggested that the datasets were not suited to assess distal outcomes. The
Dominican Republic also showed that the suitability of the datasets was confirmed by the empirical
evidence.
141. Second, the Panel's reasoning is internally incoherent. The Panel explained that the datasets
were unreliable because questions on distal outcomes "were not asked to 'recent quitters'", which
necessarily assumes that the TPP measures induced increased quitting within the first year of
implementation (the survey period). 106 However, the Panel elsewhere accepted that the
TPP measures had no positive impact on quitting in the first year of implementation.107
4. The Panel failed to make an objective assessment regarding cigar-specific evidence
142. Only one paper – by Miller et al 2015 – examined the post -implementation impact of the
TPP measures on cigar smoking. 108 Australia relied on Miller et al 2015 as affirmative evidence of
such an impact.109
143. However, Ajzen et al identified serious methodological shortcomings in the study. They also
explained that the results, even if taken at face value, show that the TPP measures had failed to
produce the anticipated effects on cigar smoking.110
144. The Panel accepted Miller et al 2015 because: the study acknowledged the methodological
shortcomings; it was the only paper addressing the impact of the TPP measures on cigar smokers;
and it was unclear to what extent a different methodology would have changed the results of the
study.111 In so finding, the Panel erred under Article 11 of the DSU.
145. First, the Panel treated competing evidence inconsistently. On one hand, for Miller et al 2015,
the Panel used the following as reasons to accept the study: the authors' acknowledgement of
shortcomings, ambiguity in the consequences of changing methodology, and the absence of other
relevant data.112 On the other hand, in assessing the complainants' evidence, the Panel used similar
considerations as reasons to reject the robustness of evidence.113

102 Dominican Republic's comments on Australia's response to Panel question No. 198, paras. 394
and 713.
103 Australia's response to Panel question No 196, para. 237.
105 Australia's response to Panel question No 196, para. 237.
106 Panel Report, Appendix B, para. 118; and Ajzen et al. Second Data Rebuttal Report,
(Exhibit DOM/IDN-8), para. 14.
107 Panel Report, Appendix A, footnote 163 to para. 101; and Appendix D, footnote 50 to para. 46, and
paras. 90, 111, and 113.
108 Panel Report, para. 7.622.
109 Australia's first written submission, paras. 82, 173, 184, 197, and footnote 618 to para. 439.
110 Dominican Republic's second written submission, paras. 457-462; Ajzen et al. Data Report
(Exhibit DOM/IDN-2), paras. 251-262.
111 Panel Report, Appendix A, paras. 32 and 71; and, Appendix B, paras. 40 and 76.
112 Panel Report, Appendix A, paras. 32 and 71; see also para. 72; and, Appendix B, paras. 40 and 76.
113 Panel Report, para. 7.955; Appendix A, para. 69; Appendix B, paras. 38, and 115-116; Appendix D,
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

146. Second, the Panel failed to provide reasoned and adequate explanations, and failed to engage
with the Dominican Republic's evidence, in its assessment of Ajzen et al and Miller et al 2015. In
one instance, the Panel explicitly cited Ajzen et al as the basis for findings that were, in fact,
contradictory to the evidence presented by Ajzen et al. 114 The Panel also failed to address, in its
assessment of the impact of the TPP measures on cigar smoking, the Dominican Republic's evidence
that the TPP measures had no impact on certain distal outcomes. 115 The Panel's failure to engage
with this evidence had "an explicit bearing on the objectivity of [its] factual assessment".116
5. The Panel erred in relation to the evidence on the correlation between the appeal of
tobacco products and smoking behaviours
147. Both the Dominican Republic and Australia presented post-implementation evidence on the
existence of a correlation between th e appeal of the tobacco products and smoking behaviours, as
discussed above. In the absence of such a correlation, a reduction in the appeal of tobacco products
cannot cause a change in smoking behaviours.
148. Australia relied on data analysis in one of the T PP papers, by Brennan et al 2015, to assert
that a correlation existed.117
149. With access to the authors' data and computer code, Ajzen et al re -analysed Brennan et al,
and found that it did not correct for systematic bias towards finding false positives. 118 Ajzen et al
then corrected for this bias, and found that there was no correlation.119
150. While the Panel accepted Brennan et al's results, it did not discuss Ajzen et al's criticisms of
the paper, in particular the systematic bias towards finding false positives. 120 Instead, the Panel
separately criticized Ajzen et al's analysis on the basis that it detected "only one or two" statistically
significant explanatory variables, and could therefore be subject to multicollinearity. 121 The Panel
failed, once again, to make an objective assessment of the parties' evidence and argument.
151. First, the Panel compromised the Dominican Republic's due process rights by applying
econometric criteria that it did not "explore" with the parties. 122 The Panel determined, on its own
initiative, and without providing the parties with an opportunity to comment, that the number of
statistical significant control variables , and multicollinearity, were pertinent to assessing Ajzen et
al.123
152. Second, the Panel t reated the parties' evidence inconsistently. It criticized Ajzen et al for
perceived flaws related to the number of statistically significant control variables and
multicollinearity, yet accepted analysis by Brennan et al 2015, which was subject to exactly the
"same limitation[s]".124
153. Third, the Panel failed to provide reasoned and adequate explanations for its assertion that
Ajzen et al is affected by an insufficient number of statistically significant control variables and by
multicollinearity. Even with th e Panel Report in hand, the Dominican Republic is left to guess the
basis for the Panel's criticisms, including any basis in the economic literature.

114 See Panel Report, Appendix A, para. 71 (emphasis added); and Ajzen et al. Data Report,
(Exhibit DOM/IDN-2), para. 257. The Panel's findings can also not be based on Miller et al. for the simple
reason that these authors failed to reports these results.
115 See Panel Report, Appendix B, paras. 40 and 120(e); and Ajzen et al. Data Report,
(Exhibit DOM/IDN-2), para. 257; and Dominican Republic's second written submission, paras. 457-462.
116 Appellate Body Report, EC – Fasteners (China), para. 442.
117 Australia's first written submission, para. 204.
118 Ajzen et al. Data Report, (Exhibit DOM/IDN-2), para. 75(e); and Ajzen et al. Second Data Rebuttal
Report, (DOM/IDN-8).
119 Ajzen et al. Data Report, (Exhibit DOM/IDN-2), para. 203.
122 Appellate Body Report, US – Large Civil Aircraft (2nd complaint), para. 1137.
123 Panel Report, Appendix B, para. 116; and Appellate Body Report, US – Large Civil Aircraft
(2nd complaint), para. 1137.
124 Appellate Body Report, US – Upland Cotton (Article 21.5), para. 292 (emphasis added).
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

154. Fourth, and finally, the Panel "made the case" for Australia. Australia "did not claim before the
Panel" that the complainants' econometric models should be assessed on the basis of the number of
statistically significant control variables and of multicollinearity.125 It never mentioned these criteria
as part of its case.
D. The Panel erred in assessing the evid ence on the potential future impact of the
TPP measures
155. The Dominican Republic's fourth ground of appeal concerns the Panel's failure to make an
objective assessment of the evidence on the potential future impact of the TPP measures on smoking
behaviours.
156. At the outset of the proceedings, Australia argued that it was too soon to evaluate the actual
impact of the TPP measures on prevalence and consumption, because such effects would only
materialize, or be detectable, at some point in the future. 126 Australia subsequently changed its
position when its expert, Dr Chipty, claimed to find that the TPP measures had already had an actual
impact on smoking behaviour.127
157. At the same time, Australia maintained that the greatest effect on smoking behaviour would
occur "in the long term".128 Australia advanced two hypotheses: the first is that TPP effects on youth
initiation will be delayed ("delayed initiation" argument); and, the second is that TPP effects on
cessation will be delayed ("delayed cessation" argument).
158. The Dominican Republic demonstrated that Australia's two hypotheses were not "tested and
supported by sufficient evidence". 129 The "delayed initiation" theory relied on an assumption that
Australian youth had positive perceptions of tobacco packaging before the introduction of the
TPP measures, which the Dominican Republic had shown to be false. 130 The "delayed cessation"
theory relied on an assumption that the TPP measures had caused an increase in quit attempts,
which the Dominican Republic had also shown to be false.131 Further, the evidence that certain
TPP effects had worn out in less than a year contradicted Australia's hypothesis that the TPP effects
would strengthen over time.132
159. The Panel did not consider any of this evidence and argument in its assessment of potential
future contribution. Instead, it merely stated that it considered "reasonable" Australia's "suggestion"
that the TPP measures may have delayed initiation and cessation effects, and may, therefore,
contribute to Australia's objective in future.133 In so doing, the Panel erred in two ways.
160. First, the Panel incorrectly applied the legal standard for assessing a "future" contribution
under Article 2.2 of the TBT Agreement. The Appellate Body has underscored that panels must
establish a measure's potential future contribution on the basis of "quantitative projections in the
future, or qualitative reasoning based on a set of hypotheses that are tested and supported by
sufficient evidence ".134 In this case, the Panel failed t o address any evidence to establish that
Australia's hypotheses were properly "tested and supported by sufficient evidence".135

125 Appellate Body Report, EC and certain member States – Large Civil Aircraft (Article 21.5 – US),
para. 5.221.
126 Australia's first written submission, para. 670.
127 See e.g. Australia's second written submission, para. 509; response to Panel question No. 196,
para. 238. See also Integrated executive summary of the arguments of the Dominican Republic, Annex B-1,
paras. 55-71.
128 Australia's second written submission, paras. 6, 495 and 498.
129 Dominican Republic's second written submission, paras. 379-380.
130 See Section above, related to the evidence on consumer perceptions.
131 Dominican Republic's second written submission, para. 500; Ajzen et al. Data Report,
(Exhibit DOM/IDN-2), p. 42, Table 5A.
132 Dominican Republic's second written submission, para. 483.
133 Panel Report, para. 7.1044.
134 Appellate Body Report, Brazil – Retreaded Tyres, para. 151 (emphasis added); and Panel Report,
para. 7.982.
135 Panel Report, para. 7.982; and Appellate Body Report, Brazil – Retreaded Tyres, para. 151
(emphasis added).
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

161. Second, the Panel erred under Article 11 of the DSU. Specifically, the Panel failed to engage
with the Dominican Republic's evidence on Australia's hypothesized future TPP effects. This evidence
refuted the premises of Australia's hypotheses and was, therefore, highly relevant to the Panel's
assessment. The Panel offered no explanation to show how the asserted "reasonableness" of
Australia's "suggestion" of future effects was grounded in anything more than speculation.136
III. THE PANEL'S FINDINGS ON THE TRADE -RESTRICTIVENESS OF THE TPP MEASURES
DERIVE FROM ERRONEOUS APPLICATION OF ARTICLE 2.2 OF THE TBT AGREEMENT, AND
FAILURE TO MAKE AN OBJECTIVE ASSESSMENT UNDER ARTICLE 11 OF THE DSU
162. Before the Panel, the Dominican Republic explained that Article 2.2 prohibits technical
regulations that are "more trade -restrictive than necessary to fulfil a legitimate objective, taking
account of the risks non-fulfillment would create". As the Appellate Body has explained, a measure
is trade -restrictive if it has a limiting effect on international trade, 137 including by limiting
"competitive opportunities" of imported products as revealed through the desi gn, structure and
expected operation of a measure.138 In this section, the Dominican Republic summarizes the Panel's
errors in its assessment of the trade-restrictiveness of the TPP measures.
A. The Panel erred in applying the concept of "trade -restrictive" under Article 2.2 of
the TBT Agreement
1. The Panel erroneously applied Article 2.2 of the TBT Agreement in finding that a
limitation on competitive opportunities was not a sufficient basis to constitute trade -
restrictiveness
163. Before the Panel, the Dominican Republic explained that a measure is "trade-restrictive" under
Article 2.2 of the TBT Agreement if it has a "limiting effect" on "competitive opportunities" for
imported products. 139 Consistent with this standard, the Dominican Republic explained t hat the
TPP measures are trade -restrictive because they require all tobacco products to be sold as
"undifferentiated commodity products that appear to be virtually identical to any other tobacco
product on the Australian market".140 Thus, by their design and structure alone, the TPP measures
restrict the competitive opportunities enabled by product differentiation. 141 Evidence of actual
trade effects is supplementary and not necessary to find trade-restrictiveness.142
164. The Panel agreed, in principle, th at a limitation on competitive opportunities may be shown
through a qualitative assessment of the design and operation of the measures, and need not "be
based on actual trade effects".143 The Panel also agreed that the TPP measures "limit the opportunity
for tobacco manufacturers to compete on the basis of […] brand differentiation", which has a
detrimental impact on consumers' "loyalty" and "willingness to pay".144
165. However, despite acknowledging that, by their very design, the TPP measures limit
competitive op portunities, the Panel found that this was not sufficient to demonstrate trade -
restrictiveness. Instead, the Panel found that it must be shown, using "appropriate evidence", "how
such effects on the conditions of competition on the market give rise to limi ting effects on
international trade in tobacco products". 145 This finding relied on an improperly narrow conception
of "competitive opportunities" as relating exclusively to price-related (perfect) competition.
166. The Panel further erred in applying Article 2.2 of the TBT Agreement by improperly
distinguishing between an assessment of the trade -restrictiveness of discriminatory versus non -
discriminatory measures, which is inconsistent with case law under Article 2.2. The Panel effectively

136 Panel Report, para. 7.1044.
137 Appellate Body Report, US – COOL, paras. 375 and 477. See also Panel Report, US – Tuna II
(Mexico), para. 7.455.
138 Appellate Body Report, US – Tuna II (Mexico), para. 319.
139 Panel Report, para. 7.1049.
140 Panel Report, para. 7.1104.
141 Panel Report, para. 7.1107.
142 Panel Report, para. 7.1049.
143 Panel Report, para. 7.1076; see also Appellate Body Report, Argentina – Import Measures,
para. 5.217 (referring to the Appellate Body Reports, China – Raw Materials, paras. 319-320).
144 Panel Report, para. 7.1167. (emphasis added) (internal footnote omitted)
145 Panel Report, paras. 7.1168. (emphasis in the original)
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

found that, while discriminatory measures do not require evidence of trade effects to demonstrate
trade-restrictiveness, non-discriminatory measures do.146
2. The Panel erroneously applied Article 2.2 of the TBT Agreement by requiring that
the data on cigarette sales "exclusivel y" show the form of trade -restrictiveness alleged
by the Dominican Republic
167. The Dominican Republic presented evidence of actual trade effects of the TPP measures,
notwithstanding that such evidence was not necessary because the TPP measures restrict
competitive opportunities by design. 147 Specifically, the Dominican Republic presented evidence of
"downtrading", i.e. a substitution of high -end products to low -end products due to consumers'
diminished loyalty and willingness to pay. 148 The Panel rejected this as evidence of trade -
restrictiveness, because it found the complainants had not demonstrated that the reduction in the
ratio of high -end to low -end cigarettes was exclusively the result of downtrading caused by the
TPP measures.149 Such a rigid causation requirement constitutes a misapplication of Article 2.2.150
3. The Panel erred in application of Article 2.2 of the TBT Agreement by requiring
consideration of possible actions by suppliers to counteract the trade -restrictive effects
of the TPP measures on consumers
168. The Panel further erred in its application of Article 2.2 of the TBT Agreement by treating the
commercial response of suppliers to the TPP measures as a necessary aspect of an analysis of trade-
restrictiveness. In particular, the Panel reasoned that, because suppliers might be able to adjust
their commercial strategy to offset the trade -restrictive impact of the TPP measures, this could
prevent a finding of trade -restrictiveness.151 However, in establishing trade -restrictiveness, a
complainant is not required to demonstrate that suppliers cannot take steps to overcome a
measures' limitations on competitive opportunities.152
B. The Panel failed to make an objective assessment, under Article 11 of the DSU, of
the parties' evidence and argument on the actual trade effects of the TPP measures
169. The Dominican Republic submitted evidence showing that the TPP measures led to
downtrading. The Panel agreed that the TPP measures contributed to the reduction in the ratio of
high-end to low-end cigarettes in Australia. However, the Panel found this did not demonstrate actual
trade effects, on the basis of the Panel's own "graphical analysis" .153 The Panel found that its own
"graphical analysis" "implie[d]" that "at least part" of this reduction in ratio was due to the overall
reduction in sales – i.e. to quitting – and not to switching to low-end products.154 However, neither
the complainants nor Australia submitted the "graphical analysis" on which the Panel relied. Instead,
this material was produced by the Panel on its own initiative. The Panel failed to make an objective
assessment under Article 11 in the following three respects.
170. First, in denying the Dominican Republic an opportunity to comment on the Panel's graphical
analysis, and its interpretation thereof, the Panel compromised the Dominican Republic's due
process rights. Second, the Panel failed to provide "reasoned and adequate explana tions" for the
inferences it drew from its own graphical analysis, which are incorrect. Third, by rejecting the
complainants' evidence based on the Panel's own graphical analysis, the Panel "made the case" for
Australia.

146 See Panel Report, paras. 7.1168.
147 See Dominican Republic's first written submission, para. 978; second written submission, para. 938;
and comments on Australia's response to Panel question No. 151.
148 Panel Report, para. 7.1197.
149 See Panel Report, Appendix E, para. 56(c); see also Appendix E, para. 55.
150 See Appellate Body Report, US – Tuna II (Mexico), para. 236-239.
151 Panel Report, paras. 7.1201, 7.1221, 7.1218 and 7.1181.
152 See Appellate Body Report, Thailand – Cigarettes (Philippines), para. 117.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

IV. THE PANEL'S ANALYSI S OF THE LE SS TRADE -RESTRICTIVE ALTERNATIVES
PROPOSED BY THE D OMINICAN REPUBLIC REFLECTS ERRORS IN APPLICATION OF
ARTICLE 2.2 OF THE TBT AGREEMENT, AND FAILURES TO MAK E AN OBJECTIVE
ASSESSMENT UNDER ARTICLE 11 OF THE DSU
171. Section IV.A summarizes the Panel's multiple errors in assessing two of the alternatives that
the Dominican Republic argued would be less trade-restrictive, and make an equivalent contribution,
to Australia's objective. These were: (1) an increase in the minimum legal purchase age of tobacco
products from 18 to 21 ("MLPA increase") and (2) an increase in excise taxation of tobacco products
("tax increase").
A. The Panel erred in evaluating the trade-restrictiveness of the proposed alternatives
172. The Dominican Republic explained that, in addition to a vo lume based -restriction, the
TPP measures entailed an additional type of trade -restriction arising from the elimination of
competitive opportunities associated with the ability to differentiate products through branding. By
contrast, the Dominican Republic's proposed alternatives would restrict trade only by reducing sales
volumes. Thus, the Dominican Republic explained that the challenged measures are more trade-
restrictive than the proposed alternatives.155
173. Earlier in its findings, the Panel rejec ted the Dominican Republic's argument that the
TPP measures' limitation on the competitive opportunities associated with branding constitutes a
trade-restriction, and found that the TPP measures were trade -restrictive only by virtue of their
impact on the volume of trade. Recalling these findings, the Panel concluded that, to the extent that
the Dominican Republic's proposed alternatives made an equivalent contribution to
Australia's objective, they would reduce trade volumes to a commensurate degree. The P anel was,
therefore, not persuaded that the complainants had demonstrated that an MLPA increase or tax
increase would be less trade-restrictive.156
174. However, the Panel had erred in assessing the trade -restrictiveness of the TPP measures.
Accordingly, when assessing whether the proposed alternatives were less trade-restrictive than the
TPP measures, the Panel's benchmark – the degree of trade-restrictiveness of the TPP measures –
was improper. The Panel thus erred in finding that the increased MLPA and tax increase alternatives
were not less trade-restrictive than the TPP measures.
175. In addition, the Panel erred in evaluating the MLPA increase. In making this evaluation, the
Panel took into account the "future effects" of the trade-restrictiveness of an MLPA incr ease.157
However, when assessing the contribution of an MLPA increase to Australia's objective, the Panel
failed to take into account the "future effects" of an MLPA increase. Thus, the Panel provided
"incoherent" reasoning, inconsistently with Article 11 of the DSU.
B. The Panel erred in evaluating the contribution of the proposed alternatives
176. Before the Panel, the Dominican Republic argued that an MLPA increase and a tax increase
would contribute to Australia's objective by banning youth access, and lowering financial access, to
tobacco products. The Panel found that, while these measures were apt to contribute to Australia's
objective, they would not make an equivalent contribution to Australia's objective, because absent
the TPP measures, the effects of t obacco packaging would not be addressed "at all", which would
weaken the "synergies" in Australia's tobacco control policy. 158 This finding resulted from errors
under Article 11 of the DSU, as well as an erroneous application of Article 2.2 of the TBT Agreement.
1. The Panel's errors under Article 11 of the DSU
177. Elsewhere in its reasoning, the Panel agreed that other elements of Australia's tobacco control
policy – including the GHW, point of sale bans, and existing laws against misleading tobacco
packaging – addressed the effects of tobacco packaging. The Dominican Republic also submitted
argument and evidence to this effect. Thus, the Panel's finding that, without the TPP measures,

155 See Dominican Republic's response to Panel question No. 151.
157 Panel Report, para. 7.1413.
158 Panel Report, para. 7.1459, 7.1462, 7.1526-7.1531.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

tobacco packaging as a means of communication would not be addressed "at all", is simply incorrect.
The Panel failed to provide reasoned and adequate explanations and coherent reasoning, and failed
to engage with the Dominican Republic's argument and evidence.
178. In assessing the "future effects" of an MLPA increase, the Panel also pr ovided "incoherent"
reasoning. When the potential future effects of a measure worked in favor of Australia , the Panel
took them into account. But, when the potential future effects worked in favor of the
Dominican Republic, the Panel did not.
2. The Panel's errors in the application of Article 2.2 of the TBT Agreement
a. The Panel erred in rejecting the proposed alternatives on the basis that they
contributed to Australia's objective using different means than the TPP measures
179. The Panel accurately articulated the standard under Article 2.2 of the TBT Agreement, finding
that "a proposed alternative may achieve an equivalent degree of contribution in ways different from
the technical regulation at issue, and that what is relevant is the overall degree of contribution that
the technical regulation makes to the objective pursued".159
180. However, in evaluating the facts, the Panel found that, in order to make a contribution
equivalent to that of the challenged measures, the proposed alternatives must address "the aspect
of the problem that the challenged measures seek to address". 160 Thus, for the Panel, alternatives
working through a different mechanism could never make the degree of contribution, because they
would "necessarily leave in place those aspects of tobacco product and retail packaging that the
TPP measures address". 161 Essentially, the Panel rejected any alternatives that work through a
mechanism different than the TPP measures. This approach is not consistent with the legal standard
under Article 2.2, as articulated by the Panel itself.
b. The Panel erred in its application of Article 2.2 of the TBT Agreement when assessing
the presence of synergies on a one-sided basis
181. A key aspect of the Panel's reasoning was that "synergies" may be lost if the TPP measures
were replaced with the proposed alternatives. 162 By "synergies", the Panel referred to a situation
where the TPP measures make another, existing tobacco control measure more effective in reducing
smoking. However, the Panel took into acco unt only the loss of synergies that could arise from
replacing the TPP measures; the Panel did not take into account synergies that could be gained from
implementing the proposed alternatives, despite evidence of such synergies.163 The Panel therefore
failed to assess the proposed alternatives in the same way it assessed the TPP measures.
V. THE PANEL'S ANALY SIS OF THE D OMINICAN REPUBLIC'S CLAIMS UNDER
ARTICLE 20 OF THE TRIPS AGREEMENT FAILED TO FULFIL TH E REQUIREMENTS OF
ARTICLE 7.1 OF THE DSU, AND FAILED TO AMOUNT TO AN OBJECTIVE ASSESSM ENT OF
THE MATTER UNDER ARTICLE 11 OF THE DSU
182. The Dominican Republic argued that the TPP measures impose "special requirements" that
"unjustifiably encumber[]" the "use of a trademark in the course of trade", under A rticle 20 of the
TRIPS Agreement.164 In assessing this claim, contrary to Articles 7.1 and 11 of the DSU, the Panel
completely failed to assess the justifiability of the encumbrance required by a distinct aspect of the
TPP measures, namely the TPP measures' prohibition on word marks on cigarette sticks. Further,
the Panel's findings under Article 20 of the TRIPS Agreement derived from its erroneous findings
under Article 2.2 of the TBT Agreement on the contribution of the TPP measures and on the
Dominican Republic's proposed alternative measures.165

159 Panel Report, para. 7.1454 (emphasis added), citing Appellate Body Report, US – COOL
160 Panel Report, para. 7.1731.
162 See Panel Report, para. 7.1528.
163 See Dominican Republic's comments on Australia's response to Panel question No. 148, para. 111.
164 See Dominican Republic's second written submission, para. 549.
165 See Panel Report, paras. 7.2592-7.2593, 7.2600.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX B-3
EXECUTIVE SUMMARY OF AUSTRALIA'S APPELLEE'S SUBMISSION
1. This dispute involves challenges to Australia's tobacco plain packaging measures ("the
TPP measures"), which operate to prevent the tobacco industry's well -documented exploitation of
product and packaging design features to influence consumer behaviour, particularly the behaviour
of young people. Australia implemented these measures on the basis of three decades of evidence
and an expl icit recommendation in the Guidelines to the World Health Organization ("WHO")
Framework Convention on Tobacco Control ("FCTC").
2. The four original complainants instituted this dispute to challenge Australia's TPP measures,
and the Panel rejected their cla ims in full. Two of the original complainants have accepted the
findings and conclusions of the Dispute Settlement Body ("DSB"), and those reports have been
adopted. Only the Dominican Republic and Honduras have appealed the report of the Panel in their
respective disputes.
3. In challenging the Panel's findings and conclusions on appeal, neither the Dominican Republic
nor Honduras advances any credible claim that the Panel erred in its legal interpretations of the
relevant provisions of the covered agreements , or in their application. With respect to the
TRIPS Agreement, Honduras pursues on appeal only two of its ten original claims, arguing that the
Panel incorrectly interpreted and applied Article 16.1 and Article 20 of the TRIPS Agreement. The
Dominican Republic does not even advance its own arguments on these points, but merely
incorporates by reference Honduras' claims of error into its appeal. With respect to Article 2.2 of the
TBT Agreement, both appellants acknowledge that the Panel "correctly articulated the legal standard
that applies under the TBT Agreement",1 yet proceed nonetheless to advance a claim of "legal error"
on the part of the Panel.
4. Instead of advancing credible legal claims, the appellants have brought an unprecedented
challenge to the factual findings of a panel under Article 11 of the Understanding on Rules and
Procedures Governing the Settlement of Disputes ("DSU"). The appellants' claims that the Panel did
not undertake an objective assessment of the matter before it relate overwhelmingly to the Panel's
factual findings in support of its conclusion that the complainants failed to demonstrate that the
TPP measures are not apt to contribute to Australia's legitimate public health objective.
5. The appellants' contentions are, however, utterly belied by the depth and thoroughness of the
Panel's 1,266 page report. 2 Instead of rushing to judgment, as the appellants contend, the Panel
engaged in a comprehensive review of over 5,000 pages of party submissions, over 1,600 exhibits,
and over 80 expert reports. 3 In Australia's view, it is fair to say that the Panel Report before the
Appellate Body represents the most far-reaching assessment of an evidentiary record in the history
of the DSB, encompassing, inter alia, complex issues of public health, behavioural theory, marketing,
and econometrics.
6. The attack on the Panel's findings of fact under Article 11 of the DSU far exceed the scope of
any prior challenge to a panel's exercise of its fact -finding function. Having failed to persuade the
Panel that the TPP measures are not apt to contribute to Australia's legitimate public health
objective, the appellants have used their right to appellate rev iew under Article 17.6 of the DSU to
try to discredit the manner in which the Panel evaluated nearly every piece of contested evidence,
especially the available quantitative evidence of contribution in the limited period following the
implementation of the TPP measures. The appellants' attacks upon the objectivity of the Panel in

1 Honduras' appellant's submission, para. 11. See also Dominican Republic's appellant's submission,
para. 1245.
2 The Panel Report consists of 889 pages in the main body of the Report, plus 152 pages of analysis of
the post-implementation evidence and 226 pages of annexures.
3 The expert reports submitted by the parties included nearly 30 reports addressing complex
econometric analyses of data; nearly 25 reports on public health, psychology and behavioural theory;
seven literature reviews commissioned by the complainants; eight reports on marketing theory; four reports on
illicit trade and market conditions; and six reports on alternative measures and regulatory compliance.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

evaluating this evidence are completely unfounded and, more broadly, implicate grave systemic
concerns about the use of appellate review to re-litigate a panel's findings of fact.
I. THE CONTEXT OF THIS APPEAL
7. Australia implemented the TPP measures as the next logical step in its comprehensive
approach to tobacco control, on the basis of over three decades of research. The evidence supporting
this decision has been reviewed by pre -eminent bodies such as successive United States Surgeons
General, the United States National Cancer Institute, the United States Institute of Medicine, and
the WHO, as well as subsequent reviews by independent experts commissioned by governments and
national courts.
8. The evidence overwhelmingly confirmed: (i) the importance to the tobacco industry of
recruiting youth and adolescents to sustain their business model; (ii) that the tobacco industry by
its own admission has, over the course of decades, used toba cco packaging as a medium for
advertising and promoting tobacco products; (iii) that in a dark market like Australia, where all other
forms of tobacco advertising and promotion are banned, the tobacco industry has openly admitted
that the tobacco pack oper ates as a mobile "billboard"; and (iv) that the appearance of tobacco
packaging, including the appearance of the product itself, is capable of affecting smoking -related
behaviours including initiation by young people, cessation and relapse.
9. The complainants came to the panel proceedings in full knowledge of these conclusive findings.
They therefore assumed the burden of demonstrating a series of counter-intuitive propositions in an
attempt to establish that the TPP measures are not "apt" to contribute to Australia's objective. The
complainants first made these arguments by attacking the extensive qualitative evidence before the
Panel, arguing that:
• the pre -implementation evidence, as contained in numerous studies published in
peer-reviewed journals, was no t of "a quality or methodological rigour" sufficient to
provide a reliable basis for implementing the TPP measures;
• tobacco packaging is not a form of advertising or promotion, despite tobacco industry
documents confirming that it is, and has been used as such over decades;
• even if tobacco packaging is a form of advertising or promotion, it cannot serve this
function in the context of Australia's dark market; and
• even if branding on tobacco packaging influences consumer behaviour, this influence is
limited to existing consumers' choices to smoke one br and over another (secondary
demand) as opposed to attracting new smokers to initiate smoking (primary demand).
10. Perhaps recognising that these arguments would not be sufficient to discharge their burden in
the face of the clear qualitative evidence supporti ng tobacco plain packaging, the complainants
contended that the TPP measures could only be considered capable of contributing to
Australia's objective if they had made a quantifiable contribution to this objective in the limited
period since their implemen tation. To this end, the complainants sought to shift the focus of the
dispute away from the design, structure, and operation of the TPP measures and toward complex
econometric and statistical analyses of data gathered in the short period of time following the
implementation of the measures in December 2012. The complainants' approach to these analyses
evolved over the course of the proceedings, with new theories being presented to the Panel to
substitute for those Australia had refuted.
11. The complainants first argued that the TPP measures had "backfired" by causing an increase
in the proportion of the population who smoke (prevalence) and total cigarette sales volumes
(consumption). In the face of corrective analyses by Australia's experts, this line of arg ument was
not pursued by the complainants in later stages of the proceedings. The complainants then pivoted
to argue that the econometric evidence submitted by their experts proved definitively that no part
of the observed declines in prevalence and consumption could be attributed to the measures' effects.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

12. Based on its thorough assessment of these arguments, the Panel concluded that the
complainants had failed to discharge their burden of proving that the TPP measures are not capable
of contributing to Australia's objective.
13. With respect to the pre -implementation evidence, the Panel engaged in a detailed review of
this evidence over the course of 100 pages, and concluded that the complainants had:
• failed to demonstrate that the pre-implementation evidence was so fundamentally flawed
as to provide no support for the operation of the TPP measures;
• failed to persuade the Panel that tobacco packaging has no influence on smoking
behaviours, particularly in a dark market like Australia;
• failed to persuade the Panel that the effects of branding on tobacco packaging are limited
to secondary demand, to the exclusion of primary demand for such products;
• failed to demonstrate that the TPP measures would not be capable of reducing the appeal
of tobacco products and, consequently, affect smoking behaviours;
• failed to demonstrate that existing levels of health knowledge and risk awareness in
Australia were such that they could not be increased by enhancing the effectiveness of
graphic health warnings ("GHWs") and, consequently, affect smoking behaviours; and
• failed to demonstrate that the TPP measures, by design, would not be capable of reducing
the ability of tobacco packaging to mislead consumers and, consequently, affect smoking
behaviours.
14. The Panel likewise engaged in lengthy analyses of the complainants' post -implementation
evidence, as well as the associated rebuttal evidence submitted by Australia, detailing its findings in
four separate appendices. Ultimately, the Panel considered that the evidence relating to th e post-
implementation quantitative evidence supported its overall conclusion that the complainants had
failed to demonstrate that the TPP measures are not apt to contribute to Australia's objective, finding
in particular that:
• the post -implementation evid ence suggests that the introduction of tobacco plain
packaging "has in fact, reduced the appeal of tobacco products, as anticipated" and
suggests that plain packaging has "had some impact on the effectiveness of GHWs";4 and
• the post-implementation evidence on smoking behaviours "is consistent with a finding that
the TPP measures contribute to a reduction in the use of tobacco products".5
15. Despite the inordinate amount of time and number of expert reports the complainants devoted
to contesting these issues during the panel proceedings, the appellants now appear to concede many
of these points, which only highlights the hollowness of their case. In particular, the appellants
appear to have conceded that:
• packaging does function as advertising and promotion, a nd operates to sustain primary
demand for tobacco products to replace those smokers who quit or die;
• tobacco plain packaging affects consumer behaviour;
• tobacco plain packaging has reduced the appeal of tobacco products and increased the
effectiveness of GHWs in precisely the manner intended; and
• the TPP measures have not backfired, and that rates of prevalence and consumption in
Australia continued to decline following the implementation of the measures.

4 Panel Report, para. 7.636.
5 Panel Report, para. 7.1037.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

16. Based on these uncontested findings of the Panel, it is clear and obvious that the TPP measures
are capable of contributing to Australia's objective.
II. CLAIMS UNDER THE TRIPS AGREEMENT
17. The four complainants in the original disputes pursued ten separate claims under the
TRIPS Agreement against the TPP measures – all of which the Panel rejected.
18. In its appeal of the Panel Report in DS435, Honduras alleges error by the Panel in respect of
only two of these original claims: those under Article 16.1 and Article 20 of the TRIPS Agreement.
The Dominican Republic's arguments on appeal concerning the TRIPS Agreement are limited to
certain claims of error under Article 11 of the DSU.
19. In relation to its claims under Article 16.1 and Article 20 of the TRIPS Agreement, Honduras'
interpretative strategy is unchanged from the panel proceedings. Honduras conflates distinct
trademark-related provisions in order to contrive support for its overarching and erroneous
contention that these provisions confer a "right of use" upon the owners of registered trademarks.
20. With respect to Article 16.1, the Panel properly rejected all of the complainants' claims based
on its conclusion that Article 16.1 "formulates an obligation on Members to provide to the owner of
a registered trademark the right to 'stop, or hinder' all those not having the owner's consent from
using certain signs on certain goods or services, where such use would result in a likelihood of
confusion."6 The Panel found that Article 16.1 "does not formulate any other right of the trademark
owner, nor does it mention the use of the registered trademark by its owner."7
21. Honduras insists that its interpretation of Article 16.1 is not based on a "positive right to use"
a trademark.8 At the same time, Honduras argues that a Member "fails to abide by its commitment
to guarantee a minimum level of protection" under Article 16.1 when it adopts a measure that
prevents the use of a mark, and thus "has so weakened the mark that almost any claim for
infringement will be rejected".9
22. In this way, Honduras' appeal of the Panel's interpretation of Article 16.1 is premised on the
same fundamental defect as its original arguments before the Panel, and should be rejected by the
Appellate Body for the same reasons. As the Panel properly found, nothing in the text of Article 16.1
suggests that Members must "maintain market conditions that would enable the circumstances set
out in this provision, including a likelihood of confusion, to actually occur in any particular situation.
Rather, Members must ensure that in the event that these circumstances do arise, a right to prevent
such use is provided."10
23. Honduras' appeal of the Panel's interpretation of Article 20 is divided into two parts. In its
principal appeal, Honduras alleges that "the Panel erred by failing to adopt a trademark -specific
approach".11 Honduras' basic contention is that Members may never impose special requirements
that encumber the use of trademarks for reasons relating to public health or other public policy
considerations, unless the resulting encumbrance is "limited" (a term that does not appear in
Article 20) or is "justified by a concern inherent in the particular trademark", such as the types of
reasons that would warrant a denial of registration of the trademark in t he first instance. 12 In
Honduras' view, a prohibition on the use of a category of trademarks (such as figurative trademarks)
for a particular purpose (such as to prevent the advertising and promotion of tobacco products) is
unjustifiable per se.
24. Honduras' extreme interpretation of the term "unjustifiably" finds no support in the ordinary
meaning of this term, properly interpreted in its context and in light of the object and purpose of
the TRIPS Agreement (or its negotiating history). Rather, the interpretat ion of the term
"unjustifiably" that Honduras advocates is based on an unfounded attempt to read a "right of use"

6 Panel Report, para. 7.1974.
7 Panel Report, para. 7.1974.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

into Part II, Section 2 of the TRIPS Agreement and to interpret Article 20 of the TRIPS Agreement
as a "limited" exception to this "right". The Panel properly rejected Honduras' interpretative strategy,
and so should the Appellate Body.
25. The second part of Honduras' challenge to the Panel's interpretation of Article 20 is formulated
"in the alternative" and assumes "arguendo that the Panel is correct that the term 'unjustifiably' in
Article 20 stands for a more broadly applicable policy exception." 13 In that event, Honduras argues
that the Panel erred by not interpreting the term "unjustifiably" "as requiring that less trademark
encumbering alternative measures that provide an equivalent contribution be preferred."14
26. This second part of Honduras' interpretative appeal is equally unfounded, given the Panel
effectively did interpret Article 20 to require an examination of proposed alternatives and did in fact
examine the alternatives proposed by the complainants. In other words, the Panel did what Honduras
alleges it was required to do.
27. In Part III.3 of its appeal, Honduras assumes arguendo that the Panel properly interpreted
the term "unjustifiably", but claims that the Panel misapplied Article 20 to the facts of the case.
28. Honduras contends, for example, that the Panel placed "undue emphasis on the loss of
economic value of the trademarks rather than focusing on the impact of the TPP measures on the
use of a trademark in terms of its distinguishing function."15 However, the Panel clearly stated that
its examination of the nature and extent of the encumbrance would "focus on the implications of the
TPP trademark requirements on a trademark's ability to di stinguish goods and services of
undertakings in the course of trade".16 In other words, the Panel's analysis focused on precisely what
Honduras claims it was required to focus on. Honduras' numerous other arguments in support of its
application claims are likewise unfounded.
29. The Dominican Republic advances only one distinct claim of error in respect of the Panel's
findings under Article 20 of the TRIPS Agreement. The Dominican Republic alleges that the Panel did
not undertake any assessment of the Dominican Republic's claims under Article 20 concerning the
prohibition on the use of trademarks on cigarette sticks, and that the Panel thereby acted
inconsistently with Article 11 of the DSU.
30. It is abundantly clear from the Panel Report that the Panel did, in fact, examine the
Dominican Republic's claims under Article 20 concerning cigarette sticks. As best as Australia can
discern, the Dominican Republic appears to consider that the Panel wa s required to have a distinct
subsection in its report in which it separately addressed those claims. No such requirement to this
effect exists under Articles 7 and 11 of the DSU.
31. For the foregoing reasons, Australia requests that the Appellate Body reject all of the
appellants' claims of error under Articles 16.1 and 20 of the TRIPS Agreement.
III. CLAIMS UNDER THE TBT AGREEMENT
A. Claims Under Article 2.2 of the TBT Agreement – Trade-Restrictiveness
1. The Panel Did Not Err in its Interpretation and App lication of the Term "Trade -
Restrictive" under Article 2.2 of the TBT Agreement
32. At the core of the appellants' claim of error lies a disagreement as to whether any limitations
on "competitive opportunities" in the marketplace, and in particular the reduce d opportunity to
compete on the basis of brand differentiation, sufficed to establish that the TPP measures are
"trade-restrictive" under Article 2.2 of the TBT Agreement. In Australia's view, the "competitive
opportunities" standard of trade-restrictiveness espoused by the appellants finds no basis in either
the text of Article 2.2, properly interpreted, or in the Appellate Body's findings in prior cases. This

WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

overly broad legal standard would read the terms "trade-restrictive" and "obstacles to international
trade" out of the text of Article 2.2.
33. In US – Tuna II (Mexico), the Appellate Body expressly held that the term "trade-restrictive"
requires a demonstration that a technical regulation has a "limiting effect on international trade". 17
Contrary to the appellants' argument, the Appellate Body in US – COOL did not re -articulate the
relevant legal standard of trade -restrictiveness as one of "competitive opportunities" for imported
products. Rather, the Appellate Body found that the panel's finding that the COOL measure modified
the conditions of competition to the detriment of imported products vis-à-vis domestic like products
sufficed to establish that it had a limiting effect on international trade.18
34. If any limitation on "competitive opportunities" were sufficient to establish that a technical
regulation is trade-restrictive, as the appellants suggest, evidence of actual trade effects would never
be required. Virtually all technical regulations will impose, in respect of at least one market
participant, a limiting condition that did not exist prior to its enactment. Thus, the Appellate Body's
recognition in US – COOL (Article 21.5 – Canada and Mexico) that evidence of actual trade effects
might be required to establish that a non-discriminatory technical regulation is trade-restrictive not
only contradicts the complainants' erroneous "competitive opportunities" construct, but also
confirms that the relevant legal standard is one of a "limiting effect on international trade."19
35. Accordingly, the Panel did not err in finding that any limitation on the ability to compete on
the basis of brand differentiation was insufficient, without more, to establish that the TPP measures
are "trade-restrictive" within the meaning of Article 2.2. In so finding, the Panel did not require that
the TPP measures be discriminatory, as Honduras incorrectly posits. The Panel expressly observed
that "a determination of 'trade-restrictiveness' is not dependent on the existence of discriminatory
treatment of imported products" 20, and in n o instance did the Panel engage in a "comparative
assessment" of the conditions of competition for imported products vis-à-vis domestic tobacco
products. Neither did the Panel consider that evidence of actual trade effects was required. Rather,
the Panel c arefully examined both qualitative and quantitative evidence on the panel record, and
expressly recognised that the "trade -restrictiveness" of the TPP measures could be established on
the basis of qualitative evidence alone.
36. Moreover, it is unclear to Australia whether the Panel imposed an "exclusive cause" standard
in its analysis of the downtrading evidence, as the Dominican Republic argues. However, even if the
Panel did impose an exclusive cause standard, that would be immaterial and insufficient to overturn
the Panel's findings under Article 2.2. This is because the alternative measures proposed by the
complainants, applied cumulatively, would have greater downtrading effects than the TPP measures.
Thus, in no circumstance would any of the alternative measures proposed by the complainants be
less trade-restrictive than the TPP measures.
37. Finally, contrary to the Dominican Republic's suggestion, the Panel did not err in taking into
account consumption (i.e. sales) data in its assessment of trade-restrictiveness. Rather than finding
that any degree of trade -restrictiveness could be "mitigated" by supplier responses, the Panel
appropriately relied on the complainants' own expert in concluding that both supply and demand
factors should be taken into account in determining the trade-restrictive effects of the TPP measures
in the marketplace.
2. The Panel Did Not Act Inconsistently with Article 11 of the DSU in Its Assessment of
Trade-Restrictiveness
38. The Dominican Republic has failed to establish that the Panel exceeded the bounds of its
discretion as trier of fact under Article 11 of the DSU in finding that the TPP measures were
"trade-restrictive" under Article 2.2 of the TBT Agreement.
39. The Panel neither compromised the Dominican Republic's due process rights nor "made the
case" for Australia in its graphical analysis in Figure E.6. A panel has the authority under Article 11

17 Appellate Body Report, US – Tuna II (Mexico), para. 319.
18 Appellate Body Report, US – COOL, para. 477.
19 See Appellate Body Report, US – COOL (Article 21.5 – Canada and Mexico), para. 5.208 and
footnote 643 thereto.
20 Panel Report, para. 7.1074.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

of the DSU to develop its own reasoning and is not required to restrict itself to the evidence and
arguments presented by the parties.21 Such discretion encompasses the ability to conduct additional
statistical analysis, engage with economic models and evidence, and draw inferences on the basis
of the record evidence.22 Moreover, the Panel is "not required to test its intended reasoning with the
parties",23 and any concerns the Dominican Republic might have had about Figure E.6 could have
been raised in the interim review stage under Article 15 of the DSU.
40. Finally, the Dominican Republic's allegation that the Panel failed to provide a reasoned and
adequate explanation for its finding amounts to a request that the Appellate Body re-weigh the
record evidence on downtrading. Contrary to what the Dominican Republic suggests, the Panel's
conclusion that downtrading was partly attributable to the overall reduction in total wholesales
volume as a result of the TPP measures is fully consistent with the Panel's earlier finding that the
TPP measures are apt to, and do in fact, contribute to their objective of reducing the use of tobacco
products in Australia.
41. For all of the foregoing reasons, Australia requests that the Appellate Body reject the
appellants' claims under Article 2.2 of the TBT Agreement, and Article 11 of the DSU, as they relate
to the Panel's finding that the TPP measures are "trade-restrictive".
B. Claims under Article 2.2 of the TBT Agreement – Alternative Measures
1. The Panel Did Not Err in Its Application of Article 2.2 of the TBT Agreement in Its
Analysis of Alternative Measures
42. Australia submits that the Appellate Body should summarily dismiss the appellants' claims of
error in relation to the Panel's analysis of alternative measures under Article 2.2 of the
TBT Agreement without addressing the substance of those claims, for two reasons.
43. First, the appellants' claim in relation to the Panel's analysis of the "trade -restrictiveness" of
the alternatives is entirely consequential to their earlier claim that the Panel applied an erroneous
legal standard in ascertaining the trade -restrictiveness of the TPP measures. Thus, if the
Appellate Body upholds the Panel's legal standard of trade -restrictiveness under Article 2.2 of the
TBT Agreement, it necessarily follows that the Panel did not err in applying that same standard when
determining the trade-restrictiveness of each of the proposed alternatives.
44. Second, in the circumstances of this dispute, where the market is entirely supplied by imports,
any equivalent contribution to reducing the use of, and exposure to, tobacco products would
necessarily entail an equivalent limiting effect on international trade in tobacco products.
Accordingly, if the Appellate Body were to uphold the Panel's interpretation of trade-restrictiveness
under Article 2.2, any alternative measure that would make an equivalent contribution to the
TPP measures would necessarily be at least as trade-restrictive as the TPP measures.
45. In any event, the complainants' claims that the Panel erred in its analysis of the contribution
of alternative measures under Article 2.2 of the TBT Agreement are unfounded. Contra ry to the
complainants' argument, the Panel did not reject increases in the minimum legal purchase age
("MLPA") and in excise taxes because they would not operate through the same causal mechanisms
as the TPP measures. Rather, the Panel properly held that an increase in the MLPA would only
address the availability of tobacco products to individuals below 21 years of age, and would leave
unaddressed those design features of the pack that make tobacco packaging more appealing.
Moreover, the Panel correctly held that any contribution that increased excise taxes would make to
Australia's objective would be undermined by those elements of tobacco packaging that would
continue to be used to convey positive imagery or messaging, especially to adolescents and young
adults. Therefore, the Panel properly held that an increase in excise taxes would not make an
equivalent contribution to Australia's objective as the TPP measures.
46. The Panel was further correct in holding that neither an increase in the MLPA nor an increase
in excise taxes would have any synergistic effects with other elements of Australia's comprehensive
tobacco control policy, in particular enlarged GHWs. The Panel correctly found that neither of these

21 Appellate Body Report, EC – Hormones, para. 156.
22 Appellate Body Report, US – Upland Cotton (Article 21.5 – Brazil), paras. 357-358 and 406.
23 Appellate Body Report, US – Tuna II (Article 21.5 – Mexico), para. 7.177.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

alternatives would have any effect on the communicat ion functions of the pack, while the
TPP measures have the effect of increasing the effectiveness of GHWs by increasing their salience,
making them easier to see, more noticeable, and perceived as more credible and more serious.
47. Finally, Honduras is incorrect that the Panel's references to "substitute" measures implies that
the Panel imposed a standard of "identical" degree of contribution, or imposed a more rigorous
standard of equivalence in the context of a comprehensive suite of measures. Rather, the Pa nel
properly sought to ascertain whether each of the alternatives made an "equivalent" contribution to
Australia's objective as the TPP measures, and consistent with the Appellate Body's guidance in
Brazil – Retreaded Tyres , considered the contribution of the TPP measures in the context of
Australia's comprehensive tobacco control policy.
2. The Panel Did Not Act Inconsistently with Article 11 of the DSU in Its Assessment of
the Alternatives
48. Finally, the Dominican Republic has failed to demonstrate that the Panel acted inconsistently
with Article 11 of the DSU in its assessment of the alternatives. The Panel's assessment of the
trade-restrictiveness of an increase in the MLPA is not "internally contradictory" with the Panel's
assessment of the contribution of that alternative, because the Panel did not rely on "future effects"
in reaching its findings, as the Dominican Republic incorrectly posits. Rather, the Panel's findings in
relation to both the element of trade-restrictiveness and the contribution of an increase in the MLPA
were based on the immediate effects of this purported alternative.
49. Moreover, the Panel neither failed to engage with the Dominican Republic's evidence nor failed
to provide a reasoned and adequate explanation in finding that, in the absence of the TPP measures,
the communication functions of tobacco packaging would not be addressed "at all". The fact that
other existing elements of Australia's comprehensive tobacco control policy, such as enlarged GHWs,
may restrict the space availabl e for the tobacco industry to use tobacco packaging as a means of
promotion does not establish that an increase in the MLPA has those same effects.
50. Accordingly, the appellants have failed to establish that the Panel erred in its application of
Article 2.2, or acted inconsistently with Article 11 of the DSU, in its analysis of alternative measures.
IV. CLAIMS UNDER ARTICLE 11 OF THE DSU REGARDING THE PANEL'S CONTRIBUTION
FINDINGS
51. The appellants' claims under Article 11 of the DSU form the core of their appeals, collectively
comprising nearly 450 pages of their appellant submissions. This far exceeds the scope of any prior
Article 11 challenge and constitutes an unprecedented assault on a panel's performance of its
fact-finding function.
52. The appellants' as surance that they have followed "the Appellate Body's guidance" and
"carefully considered whether, and in which specific instances, to challenge the lack of objectivity of
the Panel's assessment of the matter" rings hollow given both the scale and nature of their Article 11
claims.24 Together, the appellants have alleged, inter alia, that the Panel: denied them due process
because they were denied any meaningful opportunity to comment on various aspects of the Panel's
evaluation of the expert evidence; denied them due process by relying on the technical staff of the
WTO Secretariat (disparagingly referred to as a "ghost expert") instead of appointing an expert;
lacked "even -handedness" in its approach to the evidence; and failed to provide reasoned and
adequate explanations for its findings. In making these far-reaching claims, the appellants' strategy
appears to be to re-litigate factual issues that they lost before the Panel.
53. While the appellants' particular claims are dealt with below, Australia observes a t the outset
that:
• A premise of many of the appellants' claims is that the Panel was required to test all of its
reasoning with the parties in order to afford due process. The Appellate Body has
previously rejected this proposition.25 Due process does not require that a panel "engage

24 See Dominican Republic's appellant's submission, para. 33.
25 Appellate Body Report, US – Tuna II (Mexico) (Article 21.5 – Mexico), para. 7.177.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

with the parties upon the findings and conclusions that it intends to adopt in resolving the
dispute", so long as the panel's approach does not "depart so radically" from the case
presented that the parties were "left guessing as to what proof they would have needed
to adduce."26 While the appellants assert that the Panel "depart[ed] … radically" from the
evidence and arguments presented by the parties, the evidentiary record demonstrates
otherwise.
• The complainants did not utilise the interim review process to raise substantive concerns
about the evaluation of the evidence, as provided for under Article 15 of the DSU. Neither
appellant raised concerns regarding the Panel's assessment of the factual evidence or
identified errors with respect to the Panel's evaluation of the statistical or econometric
evidence when they provided their written comments on the interim report, nor did either
appellant request a further meeting with the Panel to discuss any aspect of that evaluation.
In these circumstances, there was no failure to accord due process.
• The complainants made no request for the Panel to exercise its authority to appoint an
expert or group of experts during the course of the proceedings under Article 14.2 of the
TBT Agreement or Article 13.2 of the DSU. In light of this, the appellants' arguments that
the Panel failed to afford them due process by not appointing an expert, and criticising the
Panel for utilising the WTO Secretariat (as the "ghost expert ") for technical support, as
contemplated under Article 27 of the DSU, must be rejected.
• The complainants entirely ignore that they bore the burden of proving that the
TPP measures are incapable of contributing to Australia's objective, as outlined below, and
that the Panel properly scrutinised both parties' evidence for the purpose for which it was
provided.
• The complainants' claims that the Panel failed to provide reasoned and adequate
explanations are unfounded given that the Panel Report included over 300 pages of
detailed analysis of the evidence relating to the contribution of the TPP measures.27
A. Legal Standard for Article 11 of the DSU
54. Under Article 11 of the DSU, a panel must "consider all the evidence presented to it, assess
its credibility, determine its weight and ensure that its factual findings have a proper basis in that
evidence."28 The Appellate Body has repeatedly stated that "panels enjoy a 'margin of discretion' as
triers of fact", 29 and that "[c]onsistent with this margin of discretion, … 'not every error in the
appreciation of the evidence… may be characterized as a failure to make an objective assessment
of the facts.'"30
55. The appellants therefore cannot sustain their Article 11 claims unless the Appellate Body is
satisfied that both of the following conditions have been fulfilled:
• First, that the Panel erred by "exceed[ing] the bounds of its discretion, as the trier of
facts".31 This discretionary authority includes, inter alia, weighing the evidence, developing
reasoning independent of th e parties, framing the explanation for its findings, and
balancing due process rights.
• Second, that the error is so material that it "undermine[s] the objectivity of the panel's
assessment of the matter before it". 32 That is, even if the appellants could e stablish that
the Panel exceeded the bounds of its discretion, they would still need to demonstrate that

26 Appellate Body Report, US – Tuna II (Mexico) (Article 21.5 – Mexico), para. 7.177.
27 Including a 152-page analysis of the post-implementation evidence in Appendices A-E.
28 Appellate Body Report, Philippines – Distilled Spirits, para. 135, quoting Appellate Body Report,
Brazil – Retreaded Tyres, para. 185, in turn referring to Appellate Body Report, EC – Hormones,
paras. 132-133.
29 See Appellate Body Report, Japan – Apples, para. 221.
30 See Appellate Body Report, Japan – Apples, para. 222.
31 See Appellate Body Report, EC – Aircraft (Article 21.5 – US), para. 5.148.
32 Appellate Body Report, US – Aircraft, para. 992.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

the Panel's errors materially undermined its findings, by invalidating or vitiating the basis
for those findings.33
56. As explained below, none of the appe llants' alleged errors, individually or cumulatively,
materially undermine the Panel's ultimate legal conclusion that the complainants failed to meet their
burden of proving that the TPP measures are not apt to make a contribution to Australia's legitimate
objective.
B. The Complainants' Burden of Proof
57. At the outset, it is pertinent to recall the proper allocation of the burden of proof in this dispute,
and how that burden of proof informed the Panel's assessment of the record evidence.34
58. The complainants sought to make their prima facie case under Article 2.2 of the
TBT Agreement by arguing, inter alia, that the TPP measures "cannot contribute to their objective
through the mechanisms identified in the TPP Act, and that post -implementation evidence shows
that smoking prevalence has not in fact been reduced as a result of the TPP measures." 35 The
complainants therefore undertook the burden of demonstrating that, based on their design, structure
and intended operation, the TPP measures constituted an unnecessary obstacle to international trade
because they were incapable of contributing to Australia's objective of reducing the use of, and
exposure to, tobacco products. They further undertook to substantiate this allegation through
quantitative evidence purportedly demonstrating that the TTP measures had in fact made
no contribution to reducing smoking prevalence in Australia in the limited period of time following
their implementation.36
59. The complainants undertook this burden in the particular c ircumstances of this dispute, in
which it was undisputed that Australia's market for tobacco products is entirely sourced from
imports.37 In these circumstances, the degree to which the TPP measures contribute to
Australia's objective of reducing the use of and exposure to tobacco products necessarily
corresponds to the degree to which the measures have a limiting effect on international trade in
tobacco products. Critically, because the TPP measures only restrict trade in tobacco products to the
extent required to contribute to Australia's public health objective, the TPP measures are not more
trade-restrictive than necessary and, therefore, do not violate Article 2.2. In these circumstances,
the complainants sought to prove that the TPP measures were incapable of making any contribution
to reducing the use of and exposure to tobacco products in an attempt to discharge their burden of
establishing that the TPP measures constitute an unnecessary obstacle to international trade.
60. These circumstances – and their bearing on the Panel's analysis under Article 2.2 – also
explain why the complainants sought to fundamentally redefine the concept of trade-restrictiveness
to avoid having to establish a limiting effect on international trade in tobacco products. But even
under their erroneous definition of trade-restrictiveness, the prima facie case that the complainants
sought to establish is that the TPP measures are incapable of making any contribution to reducing
the use of, and exposure to, tobacco products.
61. The Panel approached its assessment of the pre- and post-implementation evidence submitted
by the parties in light of the burden of proof that the complainants undertook. In relation to the
design, structure and operation of the TPP measures, the Panel explained that it was not persuaded

33 See Appellate Body Reports, EC – Aircraft, para. 1335; US – Upland Cotton (Article 21.5 – Brazil),
para. 294; US – COOL, para. 323.
34 Australia notes that the appellants only challenge the Panel's analysis of contribution under Article 2.2
of the TBT Agreement, and therefore discusses the proper allocation of the burden of proof under that
provision. Honduras alone claims that the Panel acted inconsistently with Article 11 of the DSU in its
assessment of contribution under Article 20 of the TRIPS Agreement, but does not distinguish between the
arguments under that provision and under Article 2.2 of the TBT Agreement. The arguments advanced by
Australia in this section apply mutatis mutandis in the context of Article 20 of the TRIPS Agreement as well.
36 See, e.g. Dominican Republic's first written submission, para. 377; Dominican Republic's
second written submission, para. 368; Honduras' first written submission, para. 581; Honduras' second written
submission, para. 55.
37 Panel Report, para. 7.1207.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

that, "as the complainants argue, [the measures] would not be capable of contributing to Australia's
objective".38
62. In relation to the post-implementation evidence, the Panel concluded that there was evidence
that the TPP measures were having the effects "anticipated in a number of the pre -implementation
studies",39 and that the evidence in relation to smoking behaviours was consistent with the intended
operation of the TPP measures.40
63. Based on the totality of the record evidence, the Panel found that "the complainants have not
demonstrated that the TPP measures are not apt to make a contribution to Australia's objective of
improving public health by reducing the use of, and exposure to, tobacco products."41
64. Thus, crucially, and contrary to what the appellants imply in their submissions, Australia did
not bear the burden of establishing that the TPP measures contribute to reducing the use of, and
exposure to, tobacco products. Rather, the evidence submitted by Australia sought to demonstrate
that the complainants had failed to establish their prima facie case that the TPP measures are
incapable of contributing to Australia's public health objective. The appellants have not appealed the
Panel's understanding of the complainants' burden of proof.
65. The appellants' claims under Article 11 of the DSU concerning the Panel's assessment of that
evidence must therefore be viewed in light of the complainants' burden of establishing that the
TPP measures are incapable of contributing to Austra lia's objective of reducing the use of, and
exposure to, tobacco products.
C. Materiality of Alleged Errors
66. Australia will demonstrate below that the appellants' claims under Article 11 of the DSU are
without merit. However, even if the appellants could establish that the Panel "exceeded the bounds
of its discretion, as the trier of facts" in relation to the alleged errors, the appellants would still need
to demonstrate that the Panel's errors materially undermine its findings.42
67. In relation to the Panel's overall conclusion that the complainants had failed to discharge their
burden of proving that the TPP measures were incapable of contributing to their objective, the
appellants have not demonstrated that any of the errors that they have identified are material.
68. Honduras simply asserts that, "individually or in combination with one another", all of the
errors that it identifies are material to the Panel's overall contribution finding. The only "materiality"
argument that either of the appellants actually develops in relation to the Panel's overall contribution
finding is the Dominican Republic's argument that this finding would not stand in the absence of the
Panel's findings on prevalence and consumption. The Dominican Republic claims that if the
Appellate Body were to conclude that the Panel exceeded the bounds of its discretion in its
assessment of the evidence in Appendices C and D, and if the Appellate Body were to conclude that
those errors materially undermine the Panel's findings in relation to the pos t-implementation
evidence on smoking behaviour, these conclusions would invalidate the Panel's overall finding on
contribution.43
69. There is no legal foundation for the Dominican Republic's claim, because the
Dominican Republic did not even attempt to demonstrate that the Panel's alleged failures of
objectivity in respect of the relevant evidence would materially undermine its findings in
Appendices C and D. However, even if the Appellate Body were to conclude that the Panel erred in
its assessment of the evidence in Appendices C and D, and that those errors materially undermined
the Panel's findings with respect to that evidence, these errors would not be material to the Panel's
overall contribution finding.

39 Panel Report, para. 7.1036.
40 Panel Report, para. 7.1037.
42 See, e.g. Appellate Body Report, US – Large Civil Aircraft (2nd Complaint), para. 722.
43 See, e.g. Dominican Republic's appellant's submission, para. 626.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

70. The Dominican Republic's argument that the disputed Panel findings concerning the effect of
the TPP measures on smoking behaviours are "a necessary, indispensable component of its overall
conclusion on the contribution of the TPP measures to Australia's objective" reflects a fundamental
misunderstanding of the Panel's contribution analysis.
71. The Panel engaged in its assessment of the post-implementation evidence expressly aware of
the inherent limitations of that evidence in the early period of application of the TPP measures. In
particular, the Panel recognised that "certain measures to protect public health, including, as is the
case here, certain measures based on behavioural responses to expected changes in beliefs and
attitudes, may take some time to materialize fully or be perceptible in the relevant data."44
72. With respect to the evidence on smoking prevalence and consumption (Appendices C and D),
the Panel explained that "overall", it found this evidence " consistent with a finding that the
TPP measures contribute to a reduction in the use of tobacco products,"45 but did not state that this
conclusion was necessary to its overall conclusion that the complainants had failed to demonstrate
that the TPP measures are not apt to contribute to Australia's objective.
73. The Panel's overall contribution finding reflects the Panel's consideration of the totality of the
evidence. The Panel's finding would stand on the basis of the body of pre- and post-implementation
evidence that is essentially uncontested on appeal. Even if the appellants could sustain their claims
of error under Article 11 of the DSU, this finding would still leave intact:
• the pre-implementation evidence demonstrating that: (1) tobacco packaging is a form of
advertising and promotion, used in the Australian market to appeal to current and potential
consumers and to distract from the serious health effects of tobacco use; (2) tobacco plain
packaging could be expected to reduce the appeal of tobacco products, increase the
effectiveness of GHWs and reduce the ability of the pack to mislead; and (3) these effects
are capable of affecting smoking behaviour, including initiation, cessation and relapse;
• the post -implementation evidence demonstrating that the TPP measures have reduced
appeal and increased the effectiveness of GHWs;
• the post-implementation evidence demonstrating that prevalence and consumption have
declined following the implementation of the TPP measures; and
• the post -implementation evidence demonstrating that the decline in prevalence and
consumption accelerated following the implementation of the TPP measures.46
74. This evidence is more than sufficient to support the Panel's overall finding that the
complainants had "not demonstrated that the TPP measures are not apt to make a contribution to
Australia's objective of improving public health by reducing the use of, and exposure to, tobacco
products".47 Accordingly, while Australia will proceed to demonstrate that the appellants' claims of
error are unfounded, these claims of error are not material to the Panel's overall conclusion.
D. Claims Regarding the Pre-Implementation Evidence
1. The Panel's Findings on the Pre-Implementation Evidence
75. As outlined in brief above, the Panel began its contribution analysis by examining the design,
structure, and operation of the TPP measures, and accepted that the evidence available to Australia
prior to the implementation of the measures supported the operation of the "causal chain" model
under the TPP Act. In relation to the three causal mechanisms of the TPP measures (reducing the
appeal of tobacco p roducts, increasing the effectiveness of GHWs and reducing the ability of the

44 Panel Report, para. 7.938.
45 Panel Report, para. 7.1037.
46 While the Dominican Republic challenges the Panel's finding that declines in smoking prevalence
accelerated following the implementation of the TPP measures, Australia demonstrates that this claim is based
on a clear misreading of the Panel's findings.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

pack to mislead consumers about the harmful effects of smoking), the Panel concluded on the basis
of the pre-implementation evidence that:
• The complainants had not persuaded the Panel that the TPP measures would not be
capable of reducing the appeal of tobacco products (the first mechanism) and thereby
contribute to Australia's objective by affecting smoking behaviours such as initiation,
cessation and relapse. 48 In reaching this c onclusion, the Panel made a series of
intermediate findings that: (i) branded packaging can act as an advertising or promotional
tool, and has been utilised as such by tobacco companies operating in Australia's dark
market;49 (ii) there is a body of evidence emanating from qualified sources supporting the
proposition that the plain packaging of tobacco products reduces the appeal of those
products to consumers;50 and (iii) the complainants had not shown that this reduction in
appeal would not be capable of in fluencing young people's perceptions and
decision-making to impact upon initiation of tobacco use, or that tobacco plain packaging
would not be capable of affecting the ability of smokers to quit smoking or to remain quit.51
• The complainants had not persua ded the Panel that the TPP measures would not be
capable of increasing the effectiveness of GHWs (the second mechanism) and thereby
contribute to Australia's objective by affecting smoking behaviours such as initiation,
cessation and relapse.52 In reaching this conclusion, the Panel likewise made a series of
intermediate findings that: (i) the complainants had failed to est ablish that GHWs could
not be made more effective, despite the high level of knowledge or risk awareness in
Australia;53 (ii) there was evidence supporting the proposition that, in the presence of
tobacco plain packaging, the impact and effectiveness of GHW s was increased; 54 and
(iii) the complainants had not demonstrated that the removal of branding elements which
communicate messages which compete with or detract from GHWs could not be capable
of influencing smoking behaviours, including initiation and cessation.55
• The complainants had not persuaded the Panel that the TPP measures, by reducing the
ability of tobacco packaging to mislead consumers about the harmful effects of smoking
(the third mechanism ), would not be capable of impacting smoking cessation. 56 In
reaching this conclusion the Panel again made a series of intermediate findings that: (i) the
complainants had not demonstrated that the TPP measures were not capable of reducing
the ability of the pack to mislead consumers about the harmfulness of tobacco use; 57
(ii) the complainants had not persuaded the Panel that the TPP measures could not
operate as intended to a greater extent than what was already possible under existing
laws;58 and (iii) the co mplainants had not demonstrated that the TPP measures, by
reducing the ability of tobacco packaging to mislead consumers about the harmful effects
of smoking, would not have an effect on smoking behaviours, such as cessation.59
76. After spending over 100 page s of its report carefully reviewing the pre -implementation
evidence, the Panel concluded that the complainants had not demonstrated that the TPP measures
were incapable of contributing to Australia's public health objective based on the design, structure,
and operation of the measures.
2. The Appellants' Assertions that the Panel Acted Inconsistently with Article 11 of the
DSU with Respect to the Pre-Implementation Evidence Are Unfounded
77. The Dominican Republic claims that the Panel acted inconsistently with Article 11 of the DSU
by failing to engage with evidence demonstrating that branded tobacco packaging in Australia was

48 Panel Report, paras. 7.777, 7.778.
49 Panel Report, paras. 7.655-7.662, 7.659, 7.638.
50 Panel Report, paras. 7.667, 7.682, 7.683.
51 Panel Report, paras. 7.774-7.778.
52 Panel Report, para. 7.869.
53 Panel Report, para. 7.843.
54 Panel Report, para. 7.825.
55 Panel Report, paras. 7.860, 7.863.
56 Panel Report, para. 7.924.
57 Panel Report, para. 7.904.
58 Panel Report, para. 7.917.
59 Panel Report, para. 7.924.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

not appealing. 60 The Dominican Republic also claims that the Panel's reasoning was "internally
incoherent", because the Dominican Republic alleges that its evidence directly contradicts the Panel's
finding that tobacco packaging is used to convey positive associations to the consumers. 61 These
claims are unsustainable.
78. The Panel expressly took into account evidence specific to the Australia n market and
acknowledged the Dominican Republic's argument that "even before the TPP measures were
introduced, Australia's packaging had negative appeal". 62 Moreover, the Dominican Republic's
argument regarding the internal coherence of the Panel's finding s implies that the perception of
tobacco products prior to the introduction of the TPP measures was as negative as Australia could
reasonably hope to achieve. The Dominican Republic's claim that the pre-implementation evidence
demonstrated that the appeal of tobacco packaging could not be further reduced in Australia is also
irreconcilable with the findings of its own expert that the TPP measures have in fact reduced the
appeal of tobacco packaging in Australia.63
79. In addition, Honduras claims that the Panel failed to conduct an objective assessment of the
matter before it because it assigned probative value to the pre -implementation evidence, despite
"serious limitations" in that evidence,64 and maintains that the Panel erroneously concluded that any
limitations in the pre -implementation evidence could be overcome when viewed in the context of
the wider literature. 65 These claims of error must be rejected, because Honduras' assertions are
squarely directed at the Panel's discretion to assess the credibility, determine the weight, and make
findings on the basis of the evidence on the panel record.
80. Finally, both the Dominican Republic and Honduras claim that the Panel acted inconsistently
with Article 11 of the DSU by failing to ascertain whether the pre -implementation evidence was
corroborated by the post-implementation evidence.66 This assertion is demonstrably false. In relation
to the post -implementation "proximal" outcomes evidence, for example, the Panel found that the
TPP measures have "in fact reduc ed the appeal of tobacco products, as anticipated in a number of
the pre-implementation studies criticized by the complainants."67
81. In sum, the appellants' limited claims of error in relation to the Panel's analysis of the
pre-implementation evidence are misleading and incorrect, and must be rejected.
E. Claims Regarding the Post-Implementation Evidence
82. The appellants have focused the bulk of their extensive claims under Article 11 on the Panel's
analysis of the empirical evidence relating to the applicatio n of the measures following their entry
into force in December 2012 (i.e. the " post-implementation evidence"). Australia will address the
appellants' claims in relation to the Panel's analysis of the evidence concerning "proximal" outcomes
(Appendix A) and "distal" outcomes (Appendix B) in Part 0 below, and will address the appellants'
claims in relation to the Panel's analysis of the evidence relati ng to smoking behaviours
(Appendices C and D) in Part 0 below.
1. The Appellants' Claims Regarding Appendices A and B Are Unfounded
83. The Panel comm enced its analysis of the post -implementation evidence in Appendix A by
assessing the studies that focused on the impact of the TPP measures and enlarged GHWs on
non-behavioural proximal outcomes (i.e. reduced appeal of tobacco products, increased
effectiveness of GHWs, and reduced ability of the pack to mislead consumers about the harmful
effects of smoking). The Panel concluded that there was empirical evidence, supported by findings
of the complainants' own experts, that the TPP measures have reduced the appeal of tobacco

60 Dominican Republic's appellant's submission, para. 700.
61 Dominican Republic's appellant's submission, para. 740.
62 Panel Report, paras. 7.657, 7.436.
63 Ajzen et al. Data Report (DOM/IDN-2), paras. 90 and 106.
66 Dominican Republic's appellant's submission, para. 747-779; Honduras' appellant's submission,
paras. 806-814.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

products and increased the noticeability of GHWs. 68 The Panel considered that this evidence
"confirms, rather than discredits, the 'hypothesized direction'" of the TPP measures.69
84. Having made these findings, the Panel then considered the impact of the TPP measures on
"distal outcomes" in Appendix B (i.e. quitting-related cognitions, pack concealment, quit attempts,
etc.). Despite the inherent challenges in the data, as identified by the Panel,70 the Panel nonetheless
concluded that while so me of the results were "limited" or "limited and mixed", the available
post-implementation empirical evidence on the "distal" outcomes suggests that the TPP measures
are operating as expected in terms of statistically significant effects on avoidant behavi ours and
increased calls to Quitline.71 Furthermore, the Panel rejected the complainants' argument that, even
if the TPP measures had the expected effects on antecedent behaviours (which they maintained, it
had not), then these effects would be susceptible to "wear out".72
85. The appellants' claims under Article 11 of the DSU in relation to the Panel's analysis of the
evidence in Appendices A and B also lack merit and should be rejected.
86. First, both appellants argue that the Panel's findings are "incoherent" or lack a "reasoned and
adequate basis".73 Specifically, the appellants argue that, in its holistic assessment of the evidence,
the Panel relied on the "positive" evidence of "proximal" outcomes in Appendix A demonstrating that
the TPP measures were having th e effects anticipated in the pre -implementation studies, while
"ignoring" or "zeroing out" other "limited" or "limited and mixed" evidence in Appendices A and B.74
87. What the appellants are challenging is the Panel's discretion to assess the credibility,
determine the weight, and make findings on the basis of the evidence on the panel record. The
appellants ignore the fact that the Panel weighed the evidence in Appendices A and B cognizant of
the limitations of the post -implementation data and in relation to the complainants' undisputed
burden of proving that the TPP measures are incapable of contributing to Australia's objective
through the operation of the proposed "causal chain". The evidence in Appendices A and B was more
than sufficient to support the Pan el's overall finding that the complainants had not met this
prima facie burden.
88. Second, the Dominican Republic argues that the Panel's summary of the effect of the
TPP measures on distal outcomes "lacks coherence" with the Panel's own findings in Appendix B of
its Report. 75 These arguments need not detain the Appellate Body long. Each of the
Dominican Republic's allegations under this "second claim of error" relies on a selective reading of
the Panel's analysis and conclusions. Once the Dominican Republic's misrepresentations are
corrected, its arguments lack any foundation.
89. Third, the Dominican Republic argues that the Panel's assessment of the robustness of certain
of the parties' evidence in Appendix B was inconsistent with Article 11 of the DSU. Given that these
claims of error are self-evidently not material to the Panel contribution findings,76 Australia does not
believe that they merit further attention.

69 Panel Report, para. 7.954.
70 Panel Report, Appendix B, para. 118 (the Panel noted that the survey data used in the studies may be
more suited to analysing the impact of the TPP measures and enlarged GHWs on "proximal" outcomes than
more "distal" outcomes, especially because none of the survey datasets "track non-smokers who might have
taken up smoking in the absence of the TPP measures and enlarged GHWs.").
71 Panel Report, para. 7.963.
72 Panel Report, para. 7.941. The Panel noted that it was not persuaded that the examples cited by the
complainants to support this argument were directly transposable to the effects of the TPP measures on
relevant behavioural outcomes.
73 See, e.g. Dominican Republic's appellant submission, paras. 893-919; Honduras' appellant
submission, paras. 755-794.
74 See, e.g. Dominican Republic's appellant's submission, paras. 877-878, 881; Honduras' appellant's
submission, paras. 773-775.
75 Dominican Republic's appellant's submission, section II.F.3.c.
76 The Dominican Republic expressly acknowledges in relation to its first "robustness claim" that "[f]rom
a 'big picture' perspective, this difference [in duration of the statistically significant increase in calls to Quitline]
is not material to an assessment of the success of the TPP measures." Dominican Republic's appellant's
submission, para. 971. Nonetheless, the Dominican Republic devotes nearly 20 pages of its appellant
submission to its argument that the Panel erred in its assessment of the Quitline calls evidence.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

90. In sum, the appellants' claims under Article 11 with respect to "proximal" and "distal"
outcomes are wholly lacking in merit, and should be rejected.
2. The Appellants' Claims Regarding Appendices C and D Are Unfounded
91. Having found that the early post -implementation evidence on proximal and distal outcomes
confirmed that the TPP measures were operating "as intended", the Panel proceeded to examine the
post-implementation evidence concerning rates of tobacco smoking (prevalence) and the volume of
tobacco products sold (consumption). The Panel detailed its findings on prevalence and consumption
in Appendices C and D, respectively.
92. Initially, the complainants sought to demonstrate that the TPP measures are not apt to
contribute to Australia's legitimate objective because the measures had "backfired" by causing an
increase in at least certain categories of prevalence and consumption. The complainants abandoned
this position when the evidence established that rates of prevalence and consumption had continued
to decline following the implementation of the TPP measures. The complainants then changed tactics
and sought to prove that no portion of the observed declines in prevalence and consumption could
be attributed to the effects of the TPP measures. To this end, the complainants sought to prove,
first, that declines in prevalence and consumption had not accelerated since the implementation of
the TPP measures in December 2012. 77 Second, the complainants submitted econometric models
purporting to show that the TPP measures had not made a statistically significant contribution to the
observed declines.78
93. In its assessment of the evidence on prevalence (Appendix C) and consumption (Appendix D),
the Panel divided its analysis into three steps. First, the Panel examined evidence relating to whether
prevalence or consumption "has decreased following the implementatio n of the TPP measures". 79
Second, the Panel examined evidence relating to whether the reduction in prevalence or
consumption "has accelerated" following the implementation of the TPP measures.80 Third, the Panel
examined evidence relating to whether the TPP measures "have contributed to a reduction" in
smoking prevalence or consumption, "by isolating and quantifying the different factors that can
explain the evolution" of prevalence and consumption.81
94. With respect to the first and second steps in its analyses, the Panel found that prevalence and
consumption had declined and the rate of decline had accelerated following the implementation of
the TPP measures. The appellants do not challenge the first finding. Only the Dominican Republic
challenges the finding of acceleration in the case of prevalence, but this challenge is based on a
blatant mischaracterisation of the Panel's earlier findings. In Australia's view, there is no credible
dispute that prevalence and consumption declined following the implementation o f the
TPP measures, and that the rates of decline accelerated in both cases.
95. With respect to the third step in its analyses, the Panel identified multiple flaws in the
complainants' econometric models purporting to demonstrate that no portion of the observ ed
declines in prevalence and consumption could be attributed to the TPP measures, as opposed to
other factors that affect prevalence and consumption. Among the principal flaws that the Panel
identified was the fact that many of the complainants' prevalence models suggested that undisputed
determinants of prevalence – such as the price of tobacco products and increases in excise taxes –
did not have a statistically significant effect upon rates of prevalence. The Panel identified similar
flaws in the complainants' consumption models, including the fact that many of these models sought
to control for tobacco prices as a separate determinant of consumption without acknowledging that
the TPP measures themselves affect tobacco prices. The Panel questioned the validity and probative
value of econometric evidence that produced these types of anomalous results and that contained
these types of flaws, while purporting to prove that the TPP measures had made no contribution to
the observed declines in prevalence and consumption.
96. During the course of the panel proceedings, Australia's econometric experts, principally
Dr Tasneem Chipty, submitted rebuttal evidence identifying flaws in the complainants' econometric

WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

models and further demonstrating that, once the principal flaws in these models were corrected, the
model results were consistent with a negative and statistically significant contribution of the
TPP measures to the observed declines in prevalence and consumption. The Panel found that
Dr Chipty's modifications of the complainants' models had addressed "some" or "a number of" the
concerns that the Panel had identified while reviewing those models. 82 So modified, and in light of
all the econometric evidence on the record, the Panel considered that there was "some econometric
evidence" suggesting that the TPP measures had contributed, along with enlarged GHWs, to the
observed declines in prevalence and consumption.83
97. The appellants' challenges to the Panel's factual findings on prevalence and consumption relate
overwhelmingly to the third step of its analyses, i.e. to the Panel's evaluation of the complainants'
evidence that purported to isolate and quantify the determinants of prevalence and consumption,
and thereby prove that no portion of the observed declines in prevalence and consumption could be
attributed to the TPP measures. Most of the appellants' claims under Article 11 of the DSU in respect
of these findings involve a challenge to the manner in which the Panel evaluated complex
econometric evidence. These claims centre on issues such as the appropriate econometric controls
for the effects of tobacco prices and taxes, the proper specification of time trends within econometric
models, whether certain variables within the models were correlated and therefor e conveyed the
same information, and whether certain explanatory and dependent variables were potentially
endogenous.
98. In lieu of summarising Australia's rebuttal on each and every one of these technical issues, it
suffices to note that the appellants' chal lenges to the Panel's factual findings are based on several
recurring errors by the appellants.
99. The appellants' claims are based on mischaracterisations of what the Panel found . A
prime example of this phenomenon is the Dominican Republic's claim that the Panel failed to
undertake an objective assessment of the "benchmark rate of decline" in steps 2 and 3 of its
prevalence analysis. This claim is based on the premise that the Panel identified a "benchmark rate
of decline" in the first step of its analysis, when in fact it did not.
100. The appellants misapprehend the Panel's role as trier of fact . Many of the appellants'
claims presuppose that the Panel was required to act as a mere passive recipient of evidence
submitted by the parties and was not allowed to eng age meaningfully with that evidence. The
appellants' claims ignore the Appellate Body's prior recognition that, in order to discharge its duty
as the trier of fact, a panel must properly "scrutinize" econometric evidence and "reach conclusions
with respect to the probative value it accords".84 That is exactly what the Panel did in this dispute.
101. The appellants' claims misapprehend the burden of proof and the role that it played in the
Panel's assessment of the statistical and econometric evidence. The Panel properly understood that
the complainants submitted econometric evidence to prove that no portion of the observed declines
in prevalence and consumption could be attributed to the TPP measures. The Panel also understood
that Australia's econometric evidence was rebuttal evidence submitted to show that the
complainants' models did not prove what they purported to prove. The appellants repeatedly
mischaracterise the nature of the Panel's findings in respect of Australia's rebuttal evidence. The
Panel did not find, and had no need to find, that Australia's rebuttal evidence had fully resolved all
of the concerns that the Panel had identified in respect o f the complainants' econometric evidence
in order to conclude that the complainants' evidence, as modified by Dr Chipty, provided "some
econometric evidence" in support of the conclusion that the TPP measures had contributed to the
observed declines in prevalence and consumption.
102. Many of the appellants' claims overlook the well-settled principle that a panel is not required
to test its reasoning with the parties in advance of circulating its report.85 A panel does not violate
due process so long as its reas oning does not "depart so radically" from issues and evidence
presented to the panel that the parties were "left guessing as to what proof they would have needed
to adduce." 86 The allegedly "new" issues raised in the Panel Report that the appellants now

83 Panel Report, Appendix C, para. 123(c); Appendix D, 137(c).
84 Appellate Body Report, US – Upland Cotton (Article 21.5 – Brazil), para. 357.
85 See e.g. Appellate Body Report, US – Tuna II (Article 21.5 – Mexico), para. 7.177.
86 Appellate Body Report, US – Tuna II (Article 21.5 – Mexico), para. 7.177.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

challenge, such as the Panel's references to potential multicollinearity and non -stationarity in their
models, were issues that emerged directly from the parties' extensive expert submissions. The
appellants had more than ample opportunity to persuade the Pan el of the validity and probative
value of their econometric evidence, and ultimately were unable to do so.
103. The appellants' claims that they were "denied an opportunity to comment" on certain of the
Panel's findings, and thereby deprived of their right to d ue process, overlook the availability of
interim review under Article 15.2 of the DSU. The appellants raised none of the issues that they
now identify on appeal during the interim review stage, even though every one of these issues is a
type of issue that parties to other disputes have raised in prior interim reviews. To whatever extent
the Panel identified issues in its interim report that the appellants could not reasonably have
anticipated, the appellants had an opportunity to raises their concerns with the Panel and elected
not to do so.
104. The appellants overlook the fact that the Panel evaluated the validity and probative value of
their econometric evidence in light of the constantly changing nature of the complainants'
evidence. The Panel identified nume rous instances in which the complainants' experts changed
their positions on important methodological issues, often with the effect of invalidating the results
reported in their prior submissions. Instead of confronting the implications of flaws identified in their
earlier model specifications, the complainants' experts frequently changed other aspects of their
models, or abandoned prior models altogether, in an attempt to move the goalposts and start the
debate all over again. The Panel appropriately took this consideration into account when evaluating
the weight to accord to the complainants' econometric evidence.
105. Finally, many of the appellants' challenges to the Panel's factual findings on prevalence and
consumption are a thinly -disguised attempt to re-litigate factual issues or have the
Appellate Body re-weigh the evidence.
106. Each of the appellants' challenges to the Panel's findings on prevalence and consumption are
unfounded for one or more of the reasons enumerated above.
107. In addition to their failure t o establish a lack of objective assessment in any respect, the
appellants do not even attempt to demonstrate, beyond sheer assertion, that any one of the alleged
errors of objective assessment, or any combination thereof, was material to the Panel's intermediate
findings on prevalence and consumption. As summarised in Part 0 above, the appellants' claims that
the Panel's findings on prevalence and consumption reflect a lack of objective assessment are a key
input to their challenge to the Panel's overall finding on contribution. The appellants have failed to
establish the essential predicate of this broader challenge.
F. CONCLUSION
108. Australia submits that the appellants' requests for reversal of the Panel's findings should be
dismissed in their entirety, for the reasons outlined above.
109. The appellants' claims of legal error are specious, and their numerous claims that the Panel
acted inconsistently with Article 11 of the DSU in its assessment of contribution are unfounded. As
is evident from the foregoing, the appellants have failed to establish that the Panel exceeded the
bounds of its discretion as the trier of fact under Article 11 of the DSU in findin g that the
complainants failed to demonstrate that the TPP measures are not apt to make a contribution to
Australia's public health objectives.87

WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C
ARGUMENTS OF THE THIRD PARTICIPANTS
Contents Page
Annex C-1 Executive summary of Argentina's third participant's submission 70
Annex C-2 Executive summary of Brazil's third participant's submission 71
Annex C-3 Executive summary of Canada's third participant's submission 72
Annex C-4 Executive summary of China's third participant's submission 73
Annex C-5 Executive summary of the Dominican Republic's third participant's submission 74
Annex C-6 Executive summary of the European Union's third participant's submission 75
Annex C-7 Executive summary of Indonesia's third participant's submission 77
Annex C-8 Executive summary of Japan's third participant's submission 81
Annex C-9 Executive summary of Malawi's third participant's submission 82
Annex C-10 Executive summary of Mexico's third participant's submission 83
Annex C-11 Executive summary of New Zealand's third participant's submission 84
Annex C-12 Executive summary of Nigeria's third participant's submission 86
Annex C-13 Executive summary of Norway's third participant's submission 87
Annex C-14 Executive summary of the Philippines' third participant's submission 88
Annex C-15 Executive summary of Singapore's third participant's submission 89
Annex C-16 Executive summary of Thailand's third participant's submission 91
Annex C-17 Executive summary of the United States' third participant's submission 92
Annex C-18 Executive summary of Zambia's third participant's submission 94
Annex C-19 Executive summary of Zimbabwe's third participant's submission 95
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-1
EXECUTIVE SUMMARY OF ARGENTINA'S THIRD PARTICIPANT'S SUBMISSION*
I. Article 16.1 of the Agreement on Trade -Related Aspects of Intellectual Property
Rights (TRIPS).
1. Argentina understands that the rights conferred by Article 16.1 of the TRIPS Agreement are,
in essence, rights of exclusion granted to the owner of the trademark to prevent third parties from
using in the course of trade identical or similar signs.
2. Consequently, Argentina understands th at the Panel correctly interpreted the said article in
finding that the obligation to provide protection does not extend to the obligation to maintain market
conditions that permit the occurrence of certain factual circumstances provided for in that articl e,
including the likelihood of confusion.
II. Article 20 of the Agreement on Trade-Related Aspects of Intellectual Property Rights
(TRIPS).
3. Argentina considers that the Panel has properly interpreted the adverb "unjustifiably" in the
context of Article 20.
4. Argentina understands that the analysis of "justifiability" under Article 20 of the
TRIPS Agreement has its own specificity and differs from other standards contained in other
provisions of the covered agreements.
5. Argentina shares the Panel's view, also as regards the factors taken into account when
conducting the "justifiability" analysis under Article 20.
6. Argentina considers that the Panel was correct in its interpretation that the contribution of the
measure analysed to the objective pursued should be comprehensively evaluated.
7. Finally, Argentina submits that Article 8 of the TRIPS Agreement offers us eful contextual
guidance for the interpretation of the term "unjustifiably" in Article 20. Specifically, the intention of
the principles reflected in Article 8.1 is to preserve the ability of WTO Members to pursue certain
legitimate societal interests, such as public health.

* This text was originally submitted in Spanish by Argentina.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-2
EXECUTIVE SUMMARY OF BRAZIL'S THIRD PARTICIPANT'S SUBMISSION
1. In its submission, Brazil highlights the importance of analyzing this dispute in the context of
the WHO's Framework Convention on Tobacco Control. Brazil then comments on: the "trade
restrictiveness" test under Article 2.2 of the TBT Agreement; the interpretation of "unjustifiably
encumber" under Article 20 of the TRIPS Agreement; and the Members' policy space in implementing
public policies.
2. Concerning the "trade -restrictiveness" test, Brazil notes that, by performing only a "trade
effects" test under Article 2.2 of the TBT Agreement, the Panel established a higher threshold for
the analysis of non-discriminatory measures. Brazil understands the qualitative test could be omitted
only if a Panel could gather precise quantitative information concerning the trade restriction caused
by a TBT measure and its effects in competitive opportunities. Brazil also views the claimant is not
required to demonstrate trade effects to meet its evidentiary burden of proof.
3. Regarding the interpretation of "unjustifiably encumber" under Article 20 of the TRIPS, Brazil
maintains the Panel recognized the need for the encumbrance to be proportionate to the importance
of the objective pursued by finding that the reasons for the application of special requirements
should provide "sufficient support" for the encumbrance. Brazil agrees that Article 20 presupposes
a balancing between the owners' interest to use th eir trademarks and Members' ability to adopt
measures for achieving societal goals.
4. Lastly, Brazil maintains that WTO Members may encumber the use of trademarks with special
requirements, such as use in a special form, on the only condition that the encumbrance is justifiable.
The TRIPS Agreement does not mention which kinds of motivation would legitimize the adoption of
special requirements, nor defines any limit to encumber the use of a trademark other than its
justifiable nature.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-3
EXECUTIVE SUMMARY OF CANADA'S THIRD PARTICIPANT'S SUBMISSION
1. The findings of the Appellate Body in this dispute will have important systemic consequences
for all WTO Members. This dispute addresses the critical balance between the protection of
intellectual property rights and trade facilitation, and a Member's right to take legitimate public
health measures under the TRIPS Agreement and the TBT Agreement.
2. The appellants' claims that the Panel erred in its interpretation of Articles 16.1 and 20 of th e
TRIPS Agreement, and Article 2.2 of the TBT Agreement are without merit and should be dismissed.
3. The Panel was correct to conclude that TRIPS Article 16.1 of the TRIPS Agreement does not
include a right to: use a trademark; preserve or strengthen the di stinctiveness of a trademark; or
protect an owner's ability to demonstrate that a "likelihood of confusion" exists in the context of
domestic infringement proceedings. A finding otherwise, under this provision or elsewhere in the
TRIPS Agreement, would lead to the untenable result of restricting or nullifying Members' ability to
take legitimate public policy measures, including measures to protect public health.
4. The appellants misrepresent the Panel's findings with respect to the interpretation of the term
"unjustifiably" under TRIPS Article 20. The Panel did not find that Article 20 establishes a "policy
exception". The Panel properly concluded that Article 20 establishes an affirmative obligation on
Members not to impose special requirements that unjustifiably encumber the use of a trademark.
Further, the Panel properly found that an assessment of individual trademarks and their specific
features is not required, as a matter of course, to determine whether a measure is justifiable under
Article 20.
5. Canada agrees with the Panel that the test for "unjustifiably" should not be akin to an
"unnecessary" test. When the ordinary meanings of "necessary" and "justifiably" are compared, it is
evident that the threshold to establish that a measure is "necessary" must be higher and more
stringent that the threshold to establish that a measure is "justifiable". There is no basis in the text
or negotiating history to adopt a "necessary" test in Article 20. Consequently, the appellants' claim
that the comparative component of the "necessity" test should be imported into Article 20 must be
rejected.
6. Canada proposes additional elements to the Panel's "unjustifiably" test to ensure that the
critical and deliberate balance is preserved between the protection of IP rights and a Member's right
to take legitimate public policy measures. In particular, the test must include whether: the "reasons"
for the requirement are legitimate; there exists a nexus or connection between the requirement and
the reasons; and the r equirement contributes to or is capable of contributing to the reasons. The
test should not include a comparative analysis of the requirement at issue and the existence of
alternative requirements.
7. The appellants' claims under Article 2.2 of the TBT Agreement should be dismissed as they
are not substantiated by a plain reading of the Panel's findings and are without merit. The Panel's
interpretation of "trade restrictiveness" is consistent with existing case law and does not constitute
an error of law.
8. Canada encourages the Appellate Body to rigorously apply the standard under Article 11 of
the DSU to dismiss any arguments that simply seek to have factual findings overturned on appeal1.

1 Pursuant to the Guidelines in Respect of Executive Summaries of Written Submissions, WT/AB/23
(11 March 2015), Canada indicates that this executive summary contains 542 words, and that this is
ten percent or less of the total word count of Canada's third participant submission (including footnotes), which
is 5,483 words.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-4
EXECUTIVE SUMMARY OF CHINA'S THIRD PARTICIPANT'S SUBMISSION
1. These disputes touch upon important issues concerning the balance between health interests,
trade interests and intellectual property interests under the WTO covered agreements. It is
undisputed that WTO Members may take appropriate meas ures for the purpose of protection of
public health.
2. While not taking a position on the specific merits of the disputes and evidentiary assessment
issues, China would like to provide its observations on legal interpretation of two provisions of
covered agr eement: Article 20 of Agreement on Trade -Related Aspects of Intellectual Property
Rights (TRIPS Agreement) and Article 2.2 of the Agreement on Technical Barriers to Trade
(TBT Agreement).
3. With respect to Article 20 of the TRIPS Agreement, the standard of "unjustifiably" under
Article 20 of the TRIPS Agreement is not necessarily the same as that of "necessary" under
Article 2.2 of the TBT Agreement or Article XX of the GATT 1994.
4. The "unjustifiably" test appears to be neither a test identical or similar to that under Article 2.2
of the TBT Agreement or the GATT 1994, nor an "all or nothing" test in terms of the rational
connection between the measure and the policy objective. The existence of less restrictive
alternatives might not, in itself, establish that the measure at issue is unjustifiable. Equally, rational
connection that is de minimis might not, in itself, demonstrate the measure is justifiable.
5. With respect to Article 2.2 of the TBT Agreement, China hopes AB could clarify the relationship
between Article 2.2 and Article 2.1 of the TBT Agreement and whether a higher evidentiary burden
of demonstrating actual trade effects was imposed on non -discriminatory technical regulations in
order to illuminate trade-restiveness.
6. China has concern on the rigid and narrow interpretation of "equivalent degree of contribution
to relevant legitimate objective". China hope AB could clarify the scope of the legitimate objective
here, which refers to the main policy purpose, protecting human health, or the effect of th e
challenged measure, reducing the attraction of the tobacco package.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-5
EXECUTIVE SUMMARY OF THE DOMINICAN REPUBLIC'S THIRD PARTICIPANT'S SUBMISSION
1. The Dominican Republic presents interpretive arguments on one issue raised in Honduras'
appeal under Article 20 of the Agreement on Trade -Related Aspects of Intellectual Property Rights
("TRIPS Agreement"): the Panel's failure to take appropriate account of the individual characteristics
of each affected trademark in examining the nature and extent of the encumbrances, and the
justifiability of the encumbrance as it relates to the affected trademarks.
2. Establishing whether trade "use" has been "unjustifiably encumbered" involves , first, an
assessment of the existence of an encumbrance, and, second, an assessment of its justifiability.
Both stages of this analysis must be conducted based on an assessment of "each affected trademark
individually".1 The Panel failed to apply Article 20 to require appropriate account be taken of each
affected trademark.2
3. As Honduras explains, the context of Articles 15, 16, 17, and footnote 3 of the
TRIPS Agreement confirms that Article 20 requires an individualized assessment of each specific
trademark.3 Under the TRIPS Agreement, all aspects of trademark regulation, including the content,
acquisition, enjoyment, and enforcement of trademark rights, are based on individual consideration
of each particular trademark. The regulation of use is equally important, as use is essential to ensure
that a trademark fulfills its basic distinguishing function. As is the case for other aspects of trademark
regulation, the regulation of use must take account of the individual characteristics of each affected
trademark.
4. The Panel failed to do so. It found that the prohibition on stylized word marks, composite
marks and figurative marks is "partly mitigated" by the continued use of non -stylized word marks.
This finding collapses the legal and factual distinctions betw een different trademarks and different
categories of trademarks that perform distinct functions. A prohibition on the use of one trademark
is not lessened by the use of another. A mark whose use is prohibited cannot fulfill its basic function.
5. Similarly, the Panel erred in finding that individual assessment was unnecessary because
Australia "did not intend to address individual trademarks". 4 The WTO-consistency of a measure
does not hinge on a respondent's intentions. The Panel should have assessed the TPP trademark
requirements by reference to their effects on trademarks.
6. The Panel also confuses the regulation of trademarks with the regulation of products. The
encumbrance on trademarks that must be shown to be unjustifiable is not the "standardization" of
tobacco products, as the Panel said.5 It is a prohibition on the use of stylized word marks, composite
marks and figurative marks on a particular product.

1 Honduras Appellant's Submission, paras. 140, 181.
2 See generally Honduras Appellant's Submission, Section III.
3 Honduras Appellant's Submission, para. 163. (emphases added)
5 Panel Report, para. 7.2594.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-6
EXECUTIVE SUMMARY OF THE EUROPEAN UNION'S THIRD PARTICIPANT'S SUBMISSION1
1.1 Article 2.2 of the TBT Agreement
1. The European Union shares the concern that, in order to ensure due process, panels are
required to share factual evidence on which they rely with the parties to a dispute in order
to allow them to provide their views with regard to the value and use of this evidence. However,
even if the Panel's assessment of the post -implementation evidence would be affected by a failure
under Article 11 DSU, it would need to be considere d to what extent the Panel could still have
reached its conclusion that the TPP measure is apt to make a material contribution to its stated
objectives. The European Union is rather of the view that such a conclusion would be sound. It
should be possible t o reach such a conclusion on the basis of considering a reasonable amount of
evidence, including qualitative reasoning. For regulatory space to be meaningful, regulatory
authorities must be afforded sufficient latitude to choose between different available options, without
being continuously second -guessed by WTO adjudicators. They should not have to live in fear of
being swamped by excessive quantities of litigant -generated "evidence", turning the regulatory
process into a battle of attrition.
2. With regard the claim that the Panel erred in the application of Article 2.2 of the
TBT Agreement when assessing the contribution of the TPP measure, the European Union
notes that the Panel found the considerations by Australia that the impact of the measures can only
manifest itself fully over a longer period of application to be persuasive. Rather than merely
accepting that it was "reasonable" that the measures were apt to make a material contribution, the
Panel was referring to the expected effect of the measures a t issue over the longer term .
It recognised that the evidence in the early period of application of the measures "may not provide
a complete picture" and that its determination was "not intended to prejudge the future evolution of
the contribution of the T PP measures to the reduction of the use of, and exposure to, tobacco
products". Yet, it considered that the evidence on "proximal" and "distal" outcomes corroborated
Australia's claim.
3. With regard to the standard of trade-restrictiveness, the European Union agrees that any
measure regulating economic activity would likely alter the conditions of competition for all relevant
products and producers. One cannot conclude from this that there is – necessarily – also a restriction
of international trade. The comp lainants' attempt to transpose the "competitive opportunities"
language from the context of de facto discrimination reflects an attempt to escape from the
consequences of how they have framed their cases. If their real concern would have been how the
measures have impacted upon them differently, then they should have brought an MFN claim. They
have not done so. This has forced them into a conundrum of their own making. They must argue
that the measures are ineffective and yet, at the same time, trade restrictive. That is why they seek
to extend the concept of trade restrictiveness to include the manner in which the measure, allegedly,
impacts them differently. This confounds the concept of de facto discrimination with the different
concept of trade restrictiveness.
4. With regard to the complaint that the Panel would have examined the alternative
measures' contribution in light of the specific "mechanisms" by which the TPP measures
operate, rather than the objectives, the European Union considers that the Panel appropriately
recognised that the TPP measure is part of a "suite of measures" addressing a multifaceted problem,
seeking to achieve the more general and ultimate objective of reducing tobacco consumption.
Reducing the appeal of tobacco products for youth by removing the possibility to compete based on
brand image and diversification would appear to be one of the causal mechanisms by which that
overarching objective is to be achieved. It seems reasonable to posit that the complex and multi -
faceted socio-economic objective pursued by Australia may need to be approached from all available
angles, simultaneously, each measure bearing down on a particular facet of the problem. However,

1 Total words of the submission (including footnotes but excluding the executive summary) = 13451;
total words of the executive summary = 1263.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

if one measure would be omitted from the suite, there is every risk that a g ap would open up,
reducing the effectiveness of the entire suite.
5. The European Union does not consider that a different standard of "equivalence" was
imposed in case of a "suite of measures". The Panel stressed, in line with the Appellate Body in
Brazil – Retreaded Tyres , that the specific elements of Australia's tobacco strategy cannot be
replaced by alternatives that are a modification or improvement of existing measures that are
already part of the suite of measures when these would not, in themselves, adequately address the
particular causal mechanism at issue, thus leaving the suite incomplete. To the European Union,
addressing specifically the effect of the images and messages conveyed by the figurative and other
design features of the tobacco packagi ng is a particular causal mechanism, leading to the longer -
term objective of an overall reduction of smoking. It may reasonably be considered a necessary
element of the overall suite of measures, essential to ensure the effectiveness of the suite considered
as a whole. In other words, we consider that a regulator should have the possibility, as part of an
overall suite of measures, to address a specific form of competition that is proven to attract
consumers.
1.2 Article 20 of the TRIPS Agreement
6. The Panel set out a legal standard regarding the term "unjustifiably" that resembles the
justifications under Article XX of the GATT 1994 and appears to be in line with Article 20. The concept
of "justifiable" is broad enough to capture the various types of justification, with their various types
of nexus and ensures, as stated in Article 8.1 of the TRIPS Agreement, that there is scope within
the TRIPS Agreement to accommodate measures necessary to protect public health.
7. The term "unjustifiably" implies the existence of certain objectives behind the "special
requirements" as it refers to the ability to provide a "justification" or "good reason" for the relevant
action or situation that is reasonable. Article 20 does not expressly identify the types of reasons that
may form the basis for the "justifiability" of an encumbrance. The broad wording of Article 20
indicates that WTO Members could take into account public policy objectives; useful guidance can
be found in the context of the other provisions of the TRIPS Agreement, in particular Articles 7 and 8.
8. The legal standard adopted by the Panel is not limited to providing "good reasons". It actually
weighs and bala nces in each specific case several elements: the nature and extent of the
encumbrance resulting from the special requirements; the legitimate interest of the trademark; the
reasons underlying the special requirements; and whether these reasons provide sufficient support.
The legal standard appears to consider also the specific concerns raised by the trademarks concerned
as part of the analysis.
9. The ordinary meaning, the context and the objective and purpose of Article 20 of the
TRIPS Agreement do not appear to show that Article 20 only allows encumbrances that rely on
"trademark-specific concerns" and are applied in "limited manner" or "with minimal impact on its
distinguishing function". The examples introduced by "such as" in Article 20 and the "special" nature
of the requirements do not imply that the term "unjustifiably" has to be read as allowing only limited
encumbrances. Furthermore, since the relevant "use" for the purposes of Article 20 is not limited to
distinguishing the goods and services of one u ndertaking from those of other undertakings, the
"minimal impact on its distinguishing function" appears thus not to be decisive.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-7
EXECUTIVE SUMMARY OF INDONESIA'S THIRD PARTICIPANT'S SUBMISSION
I. INTRODUCTION1
1. The Dominican Republic and Honduras ("the Appellants") challenge various aspects of the
Panel's report. They seek reversal of legal interpretations by the Panel of Article 2.2 of the Agreement
on Technical Barriers to Trade ("TBT Agreement"), and Articles 16.1 and 20 of the Agreement on
Trade-Related Aspects of Intellectual Property ("TRIPS Agreement"). The Appellants also believe the
Panel failed to make an objective assessment of the matter in violation of Article 11 of the
Understanding on the Rules and Procedures Government the Settlement of Disputes ("DSU"). They
present argument and evidence showing that the Panel failed to examine the matter in an even -
handed manner, applying a double standard of proof that repeatedly benefited Australia. Finally, the
Appellants maintain that the Panel failed to respect their due process rights. In their written
submissions they detail how the Panel rejected the complainants' evidence that Australia's tobacco
plain packaging measures ("TPP measures") do not contribute to t heir objective using econometric
tests that the Panel (a) developed on its own, (b) gave the complainants no opportunity to comment
on, and (c) are not part of the Panel's record.
II. THE PANEL ERRED IN FINDING THAT AUST RALIA'S TPP MEASURES ARE NOT
INCONSISTENT WITH ARTICLE 2.2 OF THE TBT AGREEMENT
A. The Panel Erred When Assessing The Trade-Restrictiveness Of The TPP Measures
2. The Panel should have based its trade -restrictiveness finding on whether the challenged
measures modify the conditions of competition to the detriment of imported products. Instead, the
Panel embraced a "trade effects" test based on the extent to which Australia's TPP measures reduced
the volume of imports. The Panel compounded its error by insisting that any trade effects be caused
exclusively by the TPP measures.
3. The Appellate Body has made clear that panels should assess the trade -restrictiveness of
technical regulations under Article 2.2 with reference to their limiting effect on the "'competitive
opportunities' available to imported products".2 The concept of "trade-restrictiveness is broad" and
its presence may be demonstrated without having to quantify the trade effects.3
4. The complainants presented evidence that TPP's design, structure, and expected operation
restricts the competitive opportunities available to imported tobacco products. Australia admits that
TPP is intended to prevent tobacco companies from using trademarks to distinguish their products
and enhance competitive opportunities. Despite this, the Panel stated that "it needs to be shown
how such effects on the condit ions of competition on the market give rise to a limiting effect on
international trade in tobacco products".4
5. The complainants presented evidence of trade effects. They proffered evidence (not rebutted
by Australia) showing that TPP led some consumers to shift to lower -priced tobacco products. 5
However, the Panel still found no trade restriction on these grounds. The Panel claimed the evidence
did not show that the relative increase in sales of lower -priced tobacco products was "exclusively"
due to down-trading caused by the TPP measures.

1 In line with the Working Procedures of the Appellate Body, the total number of words in Indonesia's
Third Participant Submission is 20,697. The total number of words in this Executive Summary is 2,051.
2 Appellate Body Reports, US – COOL, para. 477.
3 Id.
4 Panel Report, para. 7.1168.
5 Id., para. 7.1197.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

B. The Panel Erred In Assessing Whether There Were Less Trade -Restrictive
Alternatives To The TPP Measures
6. In describing how it would assess the relative contribution of less trade-restrictive alternatives
("LRAs") to Australia's objective, the Panel notes (correctly in Indonesia's view) the Appellate Body's
guidance that
[w]hat is relevant in an assessment of 'equivalence' is 'the overall degree of contribution
that the technical regulation makes to the objective pursued … rather than any
individual isolated aspect or component of contribution'.6
7. Unfortunately, the Panel then proceeds to assess the relative contributions of LRAs and TPP,
not in terms of their overall contribution to reducing the use of and exposure to toba cco products,
but rather on their contributions to TPP's "mechanisms" (i.e. reducing appeal, increasing the
effectiveness of graphic health warnings ("GHWs"), and eliminating the ability of tobacco
manufacturers to mislead consumers). This approach runs counter to the Appellate Body's guidance
not to link equivalence to an individual aspect or component of contribution and reflects a violation
of TBT 2.2.
C. The Panel Let Australia Show That TPP Might Work In The Future, But Complainants
Had To Show That The Pre-Vetting Alternative Was Certain To Work
8. Even though Indonesia disagrees that an LRA must contribute through the same mechanisms
as TPP, the complainants included at least one alternative, pre-vetting, that did just that. The Panel
agreed:
pre-vetting … would … achieve Australia's objective of improving public health by
reducing use of, and exposure to, tobacco products through the same causal
mechanisms as those employed by the TPP measures, namely reducing appeal,
increasing the effectiveness of the GHWs, and reducing the ability of the retail packaging
of tobacco products to mislead consumers about the harmful effects of smoking or using
tobacco products.7
9. Despite these findings, the Panel concluded that the contribution made by pre-vetting was not
equivalent to the contribution made by TPP because of the possibility that it might make a lesser
degree of contribution to Australia's objective.8 The Panel speculates that pre-vetting could result in
certain design elements of tobacco packaging being allowed onto the market and that allowing these
products to appear on the market, even for a short period, could have adverse health effects.9
III. THE PANEL'S FINDINGS ON THE CONTRIBUTION OF TPP TO ITS OBJECTIVE UNDER
TBT 2.2 AND TRIPS 20 ARE VITIATED BY LEGAL ERRORS AND INCONSISTENT WITH THE
REQUIREMENTS OF AN OBJECTIVE ASSESSMENT UNDER ARTICLE 11 OF THE DSU
A. The Panel Erred When It Conflated The Effects Of TPP With The Effects Of Enlarged
GHWs
10. The complainants argued that TPP does not make a meaningful con tribution to its objective.
In making this showing the complainants faced the "perfect confound". 10 Specifically, concurrent
with its move to TPP, Australia substantially increased the size of its GHWs on packaging.
11. In order to get around this conundrum the complainants' experts assumed that all of the effect
on smoking prevalence was attributed to TPP and none resulted from the GHWs. When they did, the
evidence still showed that TPP did not have a sustained effect on smoking prevalence.

6 Id., para. 7.1368.
7 Id., para. 7.1664.
8 Id., paras. 7.1680 - 7.1683.
9 Id., para. 7.1680.
10 "A Consideration of the Empirical Evidence on the Effect of Australia's Tobacco Plain Packaging
Legislation", Prof. J. List, p. 30, 1 June 2015, Exhibit DR/IND-1.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

12. Unfortunately, the Panel never addresses complainants' claim that the TPP measures do not
contribute to their objective. Instead, it finds that TPP and enlarged GHWs contribute to Australia's
objective.11
13. The failure of the Panel to address complainants' claim vitiates its fin dings on contribution
under TBT Article 2.2. It also reflects a failure to comply with the obligation under DSU Article 11 to
make an objective assessment of the matter.12
B. The Panel Supported Its Findings Of Contribution On The Basis Of Assessments That
Are Not Specific To Australia Or The Australian Context
14. In order to conduct "an objective assessment of the matter before it, including the facts of
the case" in accordance with DSU Article 11, a panel must interpret WTO agreements in a hi ghly
contextualized manner. It must consider the facts and "circumstances that prevail in any given
case".13
15. The Dominican Republic submits that the Panel supported its finding of contribution on the
basis of evidentiary assessments that are not specific to Australia or the Australian context. 14
Indonesia agrees.
16. The Panel based its assessment of TPP's contribution to its objective, including its impact on
package appeal, effectiveness of GHWs, and the ability of the pack to mislead, on hypothetical
scenarios or stale facts.
C. The Panel Denied The Complainants The Opportunity To Comment On "Robustness"
Criteria Applied By The Panel To Assess Complainants' Post-Implementation Evidence On
Contribution
17. The parties presented numerous studies on whether the TPP measures make a contribution to
their objective. Many of these studies were based on extensive data sets and econometric models.
18. The Panel rejected the views of complainants' experts, not based on anything argued or
presented by Australia, but on the basis o f "robustness criteria" developed by the Panel, but never
raised with the parties. Had the complainants been afforded the opportunity to comment on the
robustness criteria developed by the Panel, they would have been able to address specific flaws in
the way the criteria were applied and provide a rebuttal to the conclusion that the complainants'
evidence was not robust.
19. The Panel's approach to assessing the robustness of the econometric evidence presented by
the complainants is inconsistent with Article 11 because it failed to accord the complainants due
process. The Panel did not allow complainants to comment on the criteria it used, nor its conclusion
that certain evidence presented by complainants' experts could not be relied upon because it was
not sufficiently robust.
D. The Panel Applied Robustness Criteria To Complainants' Post -Implementation
Evidence Of Contribution, But Not To Substantially Similar Evidence Presented By
Australia
20. In addition to denying complainants due process, the Panel also applied its robustness criteria
in a discriminatory manner. Instead of applying them equally to data developed by the complainants
and Australia, the Panel appears to have applied the criteria only to the data developed by the
complainants. Had the Panel applied the same robustness criteria it used to critique complainants'
data to substantially similar data presented by Australia, it would have presumably voiced similar
concerns. For example, according to the Dominican Republic, Dr Chipty's work (proffered by
Australia) suffers from the same robustness concerns as the Panel claims to have found with

11 See, e.g., Panel Report, para. 7.1025.
12 Appellate Body Report, US – Carbon Steel (India), para. 4.233.
13 Appellate Body Reports, Japan – Alcoholic Beverages II, p. 21.
14 Dominican Republic's Appellant Submission, paras. 652-825.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

evidence developed by Professors Klick and List. This lack of even -handedness is contrary to DSU
Article 11.
IV. THE PANEL ERRED IN FINDING THAT AUST RALIA'S TPP MEASU RES ARE NOT
INCONSISTENT WITH ARTICLE 16.1 OF THE TRIPS AGREEMENT
21. Indonesia supports Honduras' appeal of the Panel's finding that TPP does not violate
Article 16.1 of the TRIPS Agreement. First, Indonesia agrees that "[a] Member that directly and
deliberately seeks to reduce the strength of the mark, thereby making it impossible, over time, to
demonstrate a likelihood of confusion ... violates Article 16.1 of the TRIPS Agreement".15
Second, Indonesia agrees that the Panel mistakenly exercised judici al economy when it refused to
examine whether TPP limits the right of tobacco trademark owners to prevent an infringing use.16
V. THE PANEL ERRED I N FINDING THAT AUSTR ALIA'S TPP MEASURES ARE NOT
INCONSISTENT WITH ARTICLE 20 OF THE TRIPS AGREEMENT
22. First, Article 20 prohibits Members from imposing "special requirements" that "unjustifiably
encumber[]" the "use of a trademark in the course of trade". The Panel's findings in relation to
Article 20 reflect an erroneous interpretation of the term "unjustifiably". 17 A proper interpretation
would have led to the conclusion that the term "unjustifiably" qualifies the extent to which use of a
particular trademark may be encumbered, rather than whether the requirements imposed are
justifiable based on "good reasons".
23. Second, the Panel failed to consider the claims of Honduras and other complainants regarding
the unjustifiability of the encumbrance caused by the prohibition of all marks on cigarette sticks.
This prohibition entirely eliminates the ability to differentiate between cigarettes once they are
removed from their packaging.18 This failure on the part of the Panel to address the complainants'
arguments is also a failure to "comply with the obligation under Article 11 of the DSU to make an
objective assessment of the matter".19
VI. CONCLUSION
24. Indonesia wishes to thank the Appellate Body for its consideration of these views.

15 Honduras' Appellant Submission, para. 435.
16 Id., para. 445.
17 Honduras' Appellant Submission, paras. 52-322.
18 The Panel's failure to apply the law to the facts of this case as they pertain to cigarette sticks is legal
19 Appellate Body Report, US – Carbon Steel (India), para. 4.233.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-8
EXECUTIVE SUMMARY OF JAPAN'S THIRD PARTICIPANT'S SUBMISSION
1. When conducting an examination of whether a trademark has been "unjustifiably"
encumbered by the special requirements under TRIPS Article 20, Japan is of the view that it is
essential to identify the policy objective of the challenged measure objectively and accurately at the
outset. Otherwise, it would be impracticable to assess whether the measure is reasonably calibrated
to contribute to its policy objective.
2. Regarding the first factor of such an examination, Japan notes that effects on the use of
figurative and design aspects of trademarks by the TPP measures, and the resulting effects of the
economic value of the trademarks, should be properly taken into account when evaluating the nature
and extent of the encumbrance.
3. Regarding the second factor, Japan notes that policy objectives should be assessed based on
the measure's objective structure, design, and architecture. This does not mean that the policy
objective should be specified at the level of detail which describes the manner in which the measure
achieves the policy objective. The more deta iled the objective, the greater the risk that a measure
will always be found to contribute to the objective and that no alternative measures could equally
contribute.
4. Japan makes two points regarding the third factor. First, Japan notes that labelling regulations
are generally intended, by their structure and design, to prevent consumer confusion regarding the
content, qualities and characteristics of the goods at issue. It is therefore inappropriate to conclude
that any or all advertising or promotion function of trademarks should be prohibited for any products
with harmful effects, particularly if the trademarks do not create misunderstandings about the
harmful effects. Second, Japan takes issue with the Panel's finding that the TPP measures ensured
that o bjectives of other measures (outside its terms of reference) were not undermined. Japan
considers that the proper framework to analyze the supporting effects of the measure at issue on
other measures should be, first, to assess the contribution of such oth er measures to their own
objectives.
5. Japan makes two points regarding Article 2.2 of the TBT Agreement. First, Japan submits that
the examination of "trade -restrictiveness" under the second sentence of Article 2.2 should be
primarily based on an examinati on of the measure's design, architecture, structure and operation.
Qualitative analysis may suffice. Japan also notes that actual trade effects may not necessarily reveal
trade-restrictiveness due to the interaction of various market factors. So long as a Member
demonstrates that a modification of competitive opportunities, which is detrimental to imports, it
should logically follow that there is a limiting effect on international trade.
6. Second, Japan considers that the Panel applied an incorrect standard by requiring alternative
measures to "substitute" for the measures at issue. Giving weight to the unique characteristics or
direct effects of the measure at issue and therefore requiring proposed alternative measures to
completely substitute the challenged measure, may lead to effectively requiring a contribution that
is not just "equivalent" but rather "identical" to it.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-9
EXECUTIVE SUMMARY OF MALAWI'S THIRD PARTICIPANT'S SUBMISSION
1. Malawi appreciates the opportunity to provide its views on the Panel's findings in Australia –
Certain Measures Concerning Trademarks, Geographical Indications and Other Plain Packaging
Requirements Applicable to Tobacco Products and Packaging . Malawi has a deep interest in the
outcomes of this dispute, and in its implications for the cardinal principles underlying the multilateral
trading system.
2. Tobacco accounts for the majority of Malawi's exports by value, and supports 70 per cent of
its citizens' livelihoods. Malawi is a major glob al producer of Burley and unmanufactured tobacco.
Tobacco plain packaging measures have the potential to greatly and negatively impact
Malawi's economic and trade interests by restricting trade.
3. Malawi is therefore concerned that the Panel's approach to th e loss of competitive
opportunities to differentiate between tobacco products appears to be at odds with the meaning of
"trade-restrictiveness" under Article 2.2 of the TBT Agreement.
4. First, for the Panel, the loss of competitive opportunities was insufficient to demonstrate that
the TPP measures are "trade -restrictive", absent actual trade effects. However, under Article 2.2,
there is no need to consider trade effects when a measure, by design, limits significant competitive
opportunities.
5. Second, the Panel concluded that while the measures may affect the overall value of tobacco
imports over time, they did not have a limiting effect because the evidence "to date" did not show
an effect. However, under Article 2.2, competitive opportunities are protected b oth now and in
future.
6. Malawi also urges the Appellate Body to ensure that the Panel conducted an objective
assessment of the facts under Article 11 of the DSU. Due process is essential to a panel's neutral
balancing of Members' competing interests, and is therefore an important part of the legitimacy of
the WTO's dispute settlement system. The allegations that the panel devised its own econometric
tests, and used the results of its own internal testing as "evidence", warrant thorough review.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-10
EXECUTIVE SUMMARY OF MEXICO'S THIRD PARTICIPANT'S SUBMISSION
1. Mexico has a systemic interest in the procedures for appellate review of the report issued by
the Panel in this dispute. Specifically, Mexico considers certain elements in the Panel's interpretation
to be inconsistent with the case law to date on technical barriers to trade. The purpose of this
third participant's submission is therefore to contribute to the analysis being conducted by the
Appellate Body to clarify the rights and obligations of Members with respect to the provisions in
dispute.
2. The interpretation of international trade -restrictiveness in the light of the examination of
"necessity" in terms of Article 2.2 of the Agreement on Technical Barriers to Trade (TBT Agreement)
is the key to determining whether a technical regulation is permitted or prohibited under that
provision.
3. Mexico believes that there are inconsistencies as regards the legal analysis carried out by the
Panel of: (i) the meanin g of the term "trade -restrictive" and (ii) the application of the standard to
the challenged measures.
4. Regarding the term "trade-restrictive", although the TBT Committee's recommendation may
be relevant in assessing the restrictiveness of trade, Mexico co nsiders that Article 2.1 of the
TBT Agreement and the interpretations regarding the assessment of a detrimental impact on
competitive conditions provide relevant context for evaluating restrictiveness. Although these are
provisions that establish different obligations, each one can inform the other. Thus, regardless of
whether we are dealing with a discriminatory or non -discriminatory measure, Mexico believes that
the change in the competitive conditions may constitute a limiting effect on trade which may b e
evaluated according to the design, structure and operation of the measure. Likewise, although
evidence of actual trade effects may be relevant, there is no need to demonstrate the existence of
actual effects on trade as the result of a technical regulation in order to determine its inconsistency
with Article 2.2 of the TBT Agreement.
5. As regards application to the challenged measures, Mexico submits that the Panel did not
conduct an analysis based on the design, structure and operation of the measure to d etermine
whether there was a limiting effect on competitive opportunities resulting from the limitation of the
ability to compete on the basis of trademarks. Moreover, although the Panel noted that the analysis
of the measures may be qualitative, it in fac t conducted an analysis of the actual effects of the
measures. At the same time, in concluding that the decrease in the consumption and imports of
premium tobacco products was not exclusively the result of "downtrading" the Panel appears to have
considered that a certain threshold for restrictiveness had to be met. In Mexico's view, although the
Panel must try to determine to what extent a measure restricts trade, that determination does not
require that a particular threshold be met. In other words, it is not indispensable that the restriction
should attain a particular level of limitation, but rather, that it should be possible to determine at
what level or to what degree, and in what manner trade is limited. The joint assessment of whether
a measure is "m ore trade -restrictive than necessary" requires, in addition and necessarily, an
examination of other factors to help determine whether or not the measure is, in fact, an
unnecessary barrier.
6. Finally, although Mexico does not dismiss the possibility that th e analysis of the effects of a
measure on supply could be relevant, it does not consider that because there has been an increase
in prices or those prices have remained at the same level, it necessarily follows that the restrictive
effects of a measure have been neutralized. Mexico believes that it is necessary to examine whether
there is a genuine relationship between the measure and a detrimental impact on competitive
opportunities, since there may be situations in which the measure itself leads individuals to act in a
certain way.

 This text was originally submitted in Spanish by Mexico.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-11
EXECUTIVE SUMMARY OF NEW ZEALAND'S THIRD PARTICIPANT'S SUBMISSION
I. INTRODUCTION
1. This appeal is directly concerned with the legitimacy of Australia's Tobacco Plain Packaging
measures (" TPP Measures"). More broadly, however, it is concerned with the right of
WTO Members to protect public health within their countries, and the need to preserve the balance
achieved in the WTO agreements between members' trade commitments and their right to regulate
to address legitimate policy objectives. The appeals represent an unfounded challenge to this
balance, and to the proper interpretation of the WTO agreements concerned.
II. ARTICLE 11 DSU
2. There are four overarching defects that run through the appellants' Article 11 claims.
3. The first is the framing of impermissible challenges to the Panel's factual findings as
claims that the Panel breached its obligation to act with objectivity under Article 11. Of particular
concern is the framing of purely factua l appeals as allegations that the Panel "failed to provide a
reasoned or adequate explanation of its findings", or that its findings "lack an evidentiary basis".
New Zealand does not accept either of these two contentions. More importantly, however,
New Zealand is concerned that, if the two suggested failings were accepted as touchstones of a
breach of Article 11, the focus would shift from an assessment of the Panel's objectivity to an
assessment of whether the Panel's decision was correct. This would be i nconsistent with the plain
meaning of Article 111, and would transform Article 11 into a gateway to challenge the Panel's factual
findings, contrary to Article 17.6 DSU.
4. The second defect is the failure to appreciate the allocation of the burden of proof
between the parties. The appellants imply that the task of the Panel was to decide which out of the
complainants or Australia had the stronger case. This is incorrect. The onus of proof was on the
complainants to establish a prima facie case that, in imple menting the TPP measures, Australia
breached its WTO obligations. One of the ways that the complainants sought to prove their case was
by arguing that the TPP measures cannot and do not contribute to the reduction in tobacco use and
exposure.2 Australia's objective at the Panel stage was not to prove its own case, but rather to
demonstrate that the complainants had failed to establish theirs. The Panel acted in accordance with
this allocation of the burden of proof and the case that the complainants set out to prove.
5. The third issue is the incorrect characterisation of the exercise of the Panel's discretion
as a failure to act with objectivity. New Zealand is particularly concerned with the challenges brought
to the Panel's discretion to choose the evidence that it relies upon in its Report, and its discretion to
choose whether to instruct an expert. It is within the Panel's discretion to decide which evidence to
refer to in its Report. 3 The fact that the Panel did not agree with the complainants' view on th e
weight and meaning to be attributed to the evidence does not mean that the Panel did not act
objectively.4 The Panel was also within its discretion to not elect to instruct an expert. The wording
of Articles 13 DSU and Article 14.2 TBT are permissive, not mandatory. The Appellate Body made it
clear in EC-Sardines that the exercise of the discretion to instruct an expert or not will not amount
to a contravention of Article 11.5
6. The final issue is the misrepresentation of the Panel's findings. This is largely as a result
of selective reproduction of particular findings. Removed from their wider context, these statements
are easily misunderstood. The Appellate Body should be aware, in the Article 11 claims, of the ease

1 In particular, Article 11 is concerned only with whether a Panel's decision was "objective".
2 Panel Report at para. 7.485.
3 Appellate Body Report, EC – Hormones at paras. 135 and 138.
4 Appellate Body Report, Australia – Salmon at para. 267.
5 Appellate Body Report, EC – Sardines at para. 302.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

with which parties can create the appear ance of inconsistencies in a panel's reasons through the
selective and potentially misleading manner in which they are presented.
III. LEGAL STANDARD IN DETERMINING CONTRIBUTION OF TPP MEASURES
7. Honduras argues that the Panel failed to apply the correct legal standard to assess the
contribution of the TPP measures to the objective of reducing tobacco use and exposure. 6
New Zealand makes two key observations:
a. First, this is an attempt to re-package the Article 11 claims as a fresh legal issue, and an
inappropriate challenge to the Panel's factual findings that should not be entertained by
the Appellate Body.
b. Second, Honduras' discussion of the legal standard identified by the Panel misrepresents
a number of key aspects. It overstates the weight that the Panel found should be placed
on the post -implementation evidence;7 understates the Panel's acknowledgment of the
relevance of the wider suite of tobacco control measures;8 and misquotes the Panel on the
limits on its ability to carry out its own assessment of the impact of the measures.9
IV. ARTICLES 16.1 AND 20 TRIPS
8. Honduras challenges the Panel's interpretation of Article 16.1 TRIPS. The Panel properly
interpreted this provision as providing the exclusive right to prevent the use of certain signs where
such use would result in the likelihood of confusion, rather than a positive right obliging
WTO Members to ensure a trademark owner can use the trademark.
9. Honduras also alleges that the Panel failed to take a trademark -specific approach to its
interpretation of Article 20 TRIPS, and argues that the term "unjustifiably" requires a consideration
of less trademark numbering equiva lent measures, similar to the "necessity" test other covered
agreements. This is incorrect and would undermine the meaning of the term "unjustifiably", properly
interpreted in its context and in light of its object and purpose. The Panel rightfully conclud ed that
the complainants failed to demonstrate that any encumbrance imposed by Australia on the use of
trademarks was "unjustifiable".
V. ARTICLE 2.2 TBT AGREEMENT
10. The appellants allege that the Panel erred in its interpretation of the term "trade -restrictive"
in Article 2.2 TBT Agreement. The Panel properly interpreted this provision to confirm that
modification to the conditions under which all manufacturers will compete would not, in itself, be
sufficient to demonstrate trade-restrictiveness. New Zealand also disagrees with the appellants that
the Panel introduced a higher standard when considering the "trade restrictiveness" of discriminatory
measures.
11. The appellants further contend that the Panel erred in its comparative analysis of their
proposed alternative measures. This claim is entirely consequential to their claim that the Panel
applied the incorrect legal standard in ascertaining the "trade -restrictiveness" of the measures. In
any event, the Panel's finding that the measures do not make an equiv alent contribution to
Australia's legitimate objective was correct.

6 Honduras' Appellant submission at paras. 532 - 558.
7 Compare Honduras' Appellant submission at para. 541 with Panel Report at para. 7.500.
8 Compare Honduras' Appellant Submission at para. 553(iii) with Panel Report at para. 7.506.
9 Compare Honduras' Appellant Submission at para. 553(vi) with Panel Report, Appendix A, at para. 5.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-12
EXECUTIVE SUMMARY OF NIGERIA'S THIRD PARTICIPANT'S SUBMISSION
1. Nigeria is pleased to provide its views to the Appellate Body in disputes DS435 and DS441.
Tobacco is important to Nigeria's economic development, and Nigeria has an interest in the
implications of plain packaging for manufacturers seeking to enter foreign markets. Nigeria believes
that Australia's TPP measures may set a precedent for similar trad emark restrictions on other
products.
2. Nigeria asks the Appellate Body to address any failure by the Panel to conduct an objective
assessment under Article 11 of the DSU. The Panel's apparent lack of objectivity does not inspire
confidence in a country, lik e Nigeria, that aspires to greater use of the WTO's dispute settlement
system.
3. Further, the Panel applied an overly burdensome trade -restrictiveness standard under
Article 2.2 of the TBT Agreement. The trade-restrictiveness of a measure may be shown through its
"design, architecture and revealing structure". The Panel agreed that the TPP measures, by design,
limit the ability to compete on the basis of brand differentiation. However, it also required evidence
of trade effects, on the grounds that the TPP measures are non-discriminatory. There is no basis for
this additional requirement.
4. Nigeria is also concerned that the Panel placed an undue burden on complainants presenting
evidence of trade effects. The Panel found that evidence of down -trading must show that down-
trading was the exclusive cause of changes in consumption, and required evidence that producers
had changed prices. Nigeria does not understand why the Panel believed that complainants must go
to these lengths to show trade restriction.
5. Nigeria notes that this flawed application of the standard was also used as the basis for
comparing the trade restrictiveness of the less trade restrictive alternatives and the TPP measures.
Further, the Panel effectively made it impossible to identify an alternat ive measure, by requiring
that alternatives work through the same mechanisms as the TPP measures.
6. The Panel's assessment under Article 20 of the TRIPS Agreement is also questionable. Any
encumbrance on a trademark must be justifiable and relate to a proble m with an individual
trademark. However, the Panel required no consideration of the individual trademarks affected. The
Panel also acted contrary to Articles 7.1 and 11 of the DSU by not addressing the use of word marks
on cigarettes.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-13
EXECUTIVE SUMMARY OF NORWAY'S THIRD PARTICIPANT'S SUBMISSION
1. Norway disagrees with the appellants' argument that any modification of "competitive
opportunities" per se would have an actual limiting effect on international trade and thereby violate
the TBT Agreement Article 2.2. Rather, the Panel was correct in finding that "what needs to be shown
[is] how such effects on the conditions of competition on the market give rise to a limiting effect on
international trade in tobacco products".1
2. The proposed alternative measures of increased MLPA and excise taxes would not eliminate
packaging as a tool for advertising and promotion, and thereby not make an equivalent contribution
to the objectives of the TPP measure. Furthermore, the MLPA only targets young people and
consequently is less effective than the TPP measure which is directed at all age groups. When a
Member's market is supplied only by imported tobacco products, any equivalent contribution would
also necessarily entail an equivalent limiting effect on international trade.
3. It is up to complainants to demonstrate that proposed alternative measures would make an
equivalent contribution due to synergistic effects they would have with other aspects of
comprehensive strategies implemented to fight a particular complex health problem.
4. The appellants' claim that the Panel's assessment of the TPP's contributio n lacked even -
handedness in violation of the DSU Article 11, failing to acknowledge that the complainants bear the
burden of proof in establishing their prima facie case that the TPP measures do not contribute to the
objective.2

WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-14
EXECUTIVE SUMMARY OF THE PHILIPPINES' THIRD PARTICIPANT'S SUBMISSION
1. As a committed party to the Framework Convention on Tobacco Control, and as a grower,
producer, and exporter of tobacco products, the Philippines has multi -dimensional interests in this
case. The Philippines acknowledges Australia's public health objectives and does not address issues
related to these objectives. Instead, the Philippines addresses three systemic issues under the
covered agreements, which relate to the Panel's find ings on contribution, trade restrictiveness and
alternative measures under Article 2.2 of the TBT Agreement.
2. In relation to the contribution findings, panels must respect the parties' due process rights.
The Philippines appreciates that a panel might obtain assistance to understand econometric evidence
from unseen or undisclosed experts. However, panels must give the parties an appropriate
opportunity to be heard on issues critical to its assessment. If a panel develops its own econometric
"evidence"1 – possibly using unseen experts – using tests not identified by the parties, the parties
should have an opportunity to comment. This ensures due process and transparency – the parties
are not left to "guess" what evidence is relevant. Consulting the parties also provides panels with a
better foundation for their findings. In any event, panels must ensure that their findings have a
transparent and verifiable basis in the panel record.
3. The Philippines recalls that trade restrictiveness is considered through the pr ism of
competitive opportunities arising from the design, structure and operation of a measure. Evidence
of trade effects "might be" required if a limiting effect on competitive opportunities is not established
from the design of the measure. This Panel's conclusion that proof of trade effects must always be
shown in the case of non-discriminatory measures seems to depart from this understanding.
4. The Philippines understands that proposed alternative measures must, by definition,
operate through a different mechanism to achieve the same result as the measure at issue. However,
the Panel seems to have adopted an unduly narrow conception, finding that the contribution of the
alternative measures and the tobacco plain packaging measures cannot be "equivalent" because
they work through different mechanisms.

WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-15
EXECUTIVE SUMMARY OF SINGAPORE'S THIRD PARTICIPANT'S SUBMISSION
1. Singapore welcomes the opportunity to present its views in this appeal. In the written
submission, Singapore addresses the following issues.1
(a) The Panel did not err in its interpretation of the term "unjustifiably" in Article 20 of
the TRIPS Agreement
2. The Panel's finding that the unjustifiability of encumbrances under Article 20 does not require
an assessment in respect of individual trademarks is correct and supported by WTO jurisprudence.
The Panel was also correct in concluding that public health is a recognised societal interest that may
provide a justification for encumbrances under the terms of Article 20. Singapore reiterates that the
assessment of Article 20 is of unjustifiability and not necessity and therefore does not require one
to consider available alternative measures.
(b) The Panel did not err in its application of the term "unjustifiably" in Article 20 of the
TRIPS Agreement
3. The Panel did not err in its application of the first step of the three -step test. Honduras'
allegation that there was undue emphasis on the loss of economic value of the trademarks is
misplaced. The Panel also did not err in its application of the third step of the three-step test. Given
that the necessity standard should not be used to determine th e justifiability of the measure under
Article 20, there is no need for the Panel to consider the availability of alternatives measures.
(c) The Panel did not err in its interpretation of Article 16.1 of the TRIPS Agreement
4. Singapore considers that the Pan el's interpretation of Article 16.1 is correct. Article 16.1
provides for a right, belonging solely to the registered trademark owner, to exclude, not a right to
use. The latter does not exist as a consequence of a right to exclude others from using the trademark.
Even if trademark owners may have a legitimate interest to preserve the distinctiveness of their
trademarks, this does not rise to the level of a "right" as such under Article 16.1, much less a right
to use a trademark.
(d) The Panel did not err in its assessment of trade -restrictiveness pursuant to
Article 2.2 of the TBT Agreement
5. Honduras' assertion that "the issue of trade restrictiveness requires a demonstration of a
limiting effect on competitive opportunities" in every case is overly restric tive and is not supported
by jurisprudence. In any event, the complainants failed to adequately establish how the restriction
of competitive opportunities by the TPP measures would, without more, have a limiting effect on
international trade. Singapore also disagrees that the Panel applied a higher standard in its analysis
of whether the TPP measures are trade -restrictive by requiring a demonstration of actual trade
effects. In fact, the Panel considered evidence which did not concern actual trade effects w hen it
took into account the design of the TPP measures to conclude that the measures were trade -
restrictive.
(e) The Panel did not err in its interpretation and application of Article 2.2 of the
TBT Agreement with respect to the availability of less trade -restrictive alternative
measures
6. Singapore agrees with the Panel that the alternative measures proposed by the complainants
would not be less trade -restrictive than the TPP measures. Having determined that the
TPP measures are trade-restrictive both in terms of their intended and actual impact on the volume

1 This Executive Summary totals 1096 words (including footnotes). Singapore's Third Party Written
Submission totals 10989 words (including footnotes).
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

of trade in tobacco products, the Panel did not err in finding that the alternative measures would be
equally trade -restrictive, to the extent that they are designed to achieve the same degree of
contribution as the TPP measures. This is in view of the particular circumstances where the Australian
market is supplied entirely by imported tobacco products, and the fact that the TPP measures were
found to be trade-restrictive solely on the basis of their impact on the volume of trade.
7. The Panel did not err in its evaluation of the equivalence of the contribution of the alternative
measures to Australia's objective. The Panel did not require the alternative measures to opera te
through the same "means" or "mechanisms" to reduce smoking as the TPP measures. The fact that
a challenged measure is part of a broader regulatory framework, alone, should not preclude a finding
that an alternative measure would make an equivalent contribution to the Member's objective, even
if the alternative measure does not provide an identical contribution through the same "means" or
"mechanisms" as the challenged measure. However, Singapore does not understand the Panel to
have imposed or applied such a requirement.
8. On the other hand, Singapore agrees that the way in which proposed alternative measures
would operate within a suite of measures and their effect on synergies within the suite of measures,
including the creation of new synergies, would be relevant considerations. However, there is nothing
in the Panel's report which warrants the assertion that the Panel disregarded the possibility of new
synergies being created by the alternative measures.
(f) The Panel did not violate Article 11 of the DSU
9. Many of the allegations concern the Panel's assessment and treatment of conflicting evidence
presented about the efficacy (or lack thereof) of the TPP measures. In essence, the appellants
disagree with the Panel over the weight to be accorded to the evidence. However, a panel does not
err simply because it declines to accord to the evidence the weight that one of the parties believes
should be accorded to it. In this case, it was reasonable and correct of the Panel to have assessed
that the evidence, taken in its totality , supported its conclusion regarding the efficacy of the
TPP measures. The burden rests with the appellants to prove their claims and not on Australia to
prove otherwise.
10. There is no merit to the claim that the Panel was biased, e.g. in its approach on graphic health
warnings (GHWs). A body of studies supports the proposition that plain packaging of tobacco
products (independent of GHWs) would reduce their appeal to the consumer and increase the
effectiveness of GHWs. The same cannot be said of the alternative measures proposed.
11. Finally, it is surprising how forcefully the appellants now make their due process allegations.
Honduras never suggested or requested the Panel to consult experts pursuant to Article 13 of the
DSU or Article 14.2 of the TBT Agreement. Nor did either appellant express any concern regarding
the lack of due process during the interim review stage of the panel proceedings. In any event, the
Panel's findings should not be lightly interfered with in the absence of compelling evidence otherwise.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-16
EXECUTIVE SUMMARY OF THAILAND'S THIRD PARTICIPANT'S SUBMISSION
1. In Thailand's view, the Panel has properly adhered to customary rules of treaty interpretation
in its interpretation of the term "unjustifiably" in TRIPS Article 20, by reading the term in its context
and in the light of its object and purpose as found in the Preamble and Articles 7 and 8 of the
TRIPS Agreement, as we ll as the Doha Declaration. In this regard, Thailand would like to make
two specific comments.
2. Firstly, Thailand agrees with the Panel that TRIPS Article 20 provides no legal basis to suggest
that any measures, even ones with the "ultimate encumbrance"1 is inherently unjustifiable.2 Special
requirements would be prohibited, pursuant to this provision, only if they "unjustifiably encumber[]"
the use of a trademark in the course of trade.
3. Secondly, Thailand does not consider that The Panel has transposed the "trade restrictiveness"
test under TBT Article 2.2 as is to the "trademark-use encumbrance" analysis under TRIPS Article 20.
Rather than erroneously reading into existence a standard of "necessity" in the context of
TRIPS Article 20, the Panel simply acknowledged that the availability of an alternative measure that
involves a lesser encumbrance could inform an assessment of "unjustifiably" and thus may call into
question whether the justification provided sufficiently support encumbrances on the use of a
trademark.3 Precisely how the availability of alternative measures would form part of the overall
analysis should be determined on a case -by-case basis, taking into account the balance between
intellectual property rights and public interests.

2 Panel Report paras 7.2441-7.2442.
3 Panel Report para. 7.2598.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-17
EXECUTIVE SUMMARY OF THE UNITED STATES' THIRD PARTICIPANT'S SUBMISSION
I. INTRODUCTION1
1. The United States welcomes the opportunity to present its views on issues raised on appeal
by Honduras and the Dominican Republic. Pursuant to the communication from the Division on
July 23, 2018, the United States is providing its third participant submissions in the appeals in these
two disputes as a single document. 2 In this document, the United States will present its views on
the proper legal treatment of the Declaration on the TRIPS Agreement and Public Health
("Doha Declaration on TRIPS") and the claims raised in rel ation to Articles 7.1 and 11 of the
Understanding on Rules and Procedures Governing the Settlement of Disputes ("DSU").
2. The United States focuses on the two sets of issues identified above to address systemic
concerns that arise from these appeals. A prope r resolution of these two sets of issues would not
disturb the ultimate conclusions of the Panel in these disputes.
II. CLARIFICATION REGARDING THE PANEL'S TREATMENT OF THE DOHA DECLARATION
ON THE TRIPS AGREEMENT AND PUBLIC HEALTH
3. In its report, the Panel considered the types of reasons that would sufficiently support the
application of an encumbrance on the use of a trademark so as to determine the meaning of the
term "unjustifiably" in Article 20 of the TRIPS Agreement.3 The Panel correctly understood tha t,
consistent with Article 3.2 of the DSU, it should interpret the term applying customary rules of
interpretation of public international law, reflected in Articles 31 and 32 of the Vienna Convention
on the Law of Treaties ("Vienna Convention").
4. As part of its analysis, the Panel stated that paragraph 5(a) of the Doha Declaration on TRIPS
"may, in our view, be considered to constitute a 'subsequent agreement' of WTO Members within
the meaning of Article 31(3)(a) of the Vienna Convention."4
5. On appeal, Honduras argues that the Panel committed legal error finding that paragraph 5 of
the Doha Declaration on TRIPS "constitutes a 'subsequent agreement' in the sense of Article 31.3(a)
of the Vienna Convention that must be taken into consideration as part of the c ontext of the term
'unjustifiably' in Article 20 of the TRIPS Agreement."5
6. The issue of whether statements agreed by Members may constitute a "subsequent agreement
on interpretation" has raised difficulties for the functioning of some WTO committees. Rath er than
engage in this appeal on this issue, the Appellate Body could instead exercise judicial economy over
Honduras' claim of error, which has no bearing on the appeal of the Panel's legal interpretation or
conclusion.
III. COMPLAINANTS' CLAIMS OF ERROR UNDER THE DSU
7. Honduras and the Dominican Republic both appeal dozens of factual findings under
DSU Article 11. Both appeals by Honduras and the Dominican Republic to the Appellate Body make
numerous claims under Article 11 of the DSU of what clearly are alleged factual errors by the Panel.
By agreement of all WTO Members, the DSU expressly limits the scope of an appeal to alleged legal
errors by a panel, not factual errors.6 The United States disagrees with these attempts to re-litigate

1 This executive summary contains a total of 776 words (including footnotes), and the
U.S. third participant submission contains 8573 words (including footnotes).
2 See Appellate Body Procedural Ruling (23 July 2018).
5 Honduras Appellant Submission, para. 254.
6 See DSU Article 17.6.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

dozens of unfavorable factual determinations by the Panel through claims of breach of Article 11 of
the DSU.
8. The Appellate Body has an opportunity in this appeal to reconsider how its originally limited
approach to review the "objective assessment" of a panel has been seized by appellants to cover
practically all factual determinations by a panel. Given the lack of textual basis in the DSU for
appellate review of panel fact -finding, the Appellate Body could instead reassert that the proper
issues for appeal are issues of law and legal interpretations covered by a panel report.7
9. In addition, the United States agrees with Australia that the Do minican Republic's claim of a
breach under Article 7.1 of the DSU is unfounded. The claim appears to be an attempt to reopen the
dispute by incorrectly alleging that the Panel failed to address the Dominican Republic's claim that
Australia's plain packagin g measures as to individual cigarette packaging breach Article 20 of the
TRIPS Agreement. The Panel did address this claim, and the issue would in any event go to an
erroneous legal conclusion, not a terms of reference issue. Both of these bases for appeal are
seriously flawed and must be rejected.

7 Id. ("An appeal shall be limited to issues of law covered in the panel report and legal interpretations
developed by the panel.").
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-18
EXECUTIVE SUMMARY OF ZAMBIA'S THIRD PARTICIPANT'S SUBMISSION
1. Zambia thanks the Panel for its work and requests the Appellate Body to consider its
submissions, as well as the points raised by Honduras and the Dominican Republic in their appeals.
2. Zambia raises concerns with the Panel's application of Article 2.2 of the TBT Agreement. The
alternative measure should provide an equivalen t "meaningful contribution", but not provide an
"identical contribution" to the objective. Therefore, the Panel should not have rejected the alternative
measures of Honduras and the other Complainants, since they would be as effective in reducing
smoking and less trade restrictive than Australia's plain packaging rules. Further, the Panel should
have analysed the "actual contribution" of the plain packaging measures as is the usual test under
Article 2.2.
3. Zambia submits that the Panel's approach to interpre ting the term "unjustifiably" under
Article 20 of the TRIPS Agreement may not be the appropriate understanding of that provision.
Instead of referring to any "good reasons" that would be sufficient to support the measure, the test
ought to consider whether there is anything wrong with the specific trademark. Zambia supports the
Complainants view of Article 16 of the TRIPS Agreement as providing important rights for
trademarks in commerce.
4. Zambia submits that, in ignoring any contrary evidence presented by t he complainants, the
Panel does not appear to have examined the evidence in an even -handed manner in line with its
obligations under Article 11 of the DSU.
WT/DS435/AB/R/Add.1 • WT/DS441/AB/R/Add.1

ANNEX C-19
EXECUTIVE SUMMARY OF ZIMBABWE'S THIRD PARTICIPANT'S SUBMISSION
1. Zimbabwe is pleased to present its concerns to the Appellate Body with the Panel Report in
this dispute, which may impact it as a developing country whose economy is dependent on
agricultural commodities. Zimbabwe supports the important arguments expressed by the Appellants
and respectfully requests the Appellate Body to take these arguments into account, as set out below.
2. The Panel appears to have failed to treat the Complainants' evidence equitably and to not
have balanced it objectively with the Respondent's evidence. The Panel could have been aided by
appointing an independent expert under the dispute settlement rules, but it did not do that.
3. Panel's application of Article 2.2 of the TBT Agreement does not appear to accurately reflect
that WTO obligation. Zimbabwe supports arguments made by Honduras concerning the Panel's
evaluation of the "trade restrictiveness" of the measures by its trade effects as opposed to its design
and o verall architecture; the alternative measures being required to provide an "identical"
contribution to the objective rather than an "equivalent" one; and assessing the potential future
contribution of the plain packaging measures instead of their actual contribution.
4. The Panel provides an interpretation of the term "unjustifiably" in Article 20 of the
TRIPS Agreement that is separated from the trademark context. Zimbabwe believes, as Honduras
argues, that the Panel did not review whether there were any issues with the trademarks themselves
and whether any limitations could be justified based on the analysis of each trademark.
5. Finally, the Panel found that Article 16 of the TRIPS Agreement only confers a limited number
of enforcement rights to trademark owners to oppose unauthorized use in situations where there is
a risk of actual confusion in the market. Zimbabwe is concerned that this interpretation may be too
limited to provide trademark owners appropriate protections under the TRIPS Agreement,
particularly Article 20 of the TRIPS Agreement.