EUROPEAN COMMUNITIES – MEASURES CONCERNING MEAT AND MEAT PRODUCTS (HORMONES) JOINT COMMUNICATION FROM THE EUROPEAN UNION AND THE UNITED STATES
Document: COMMUNICATION FROM
Date: 17 April 2014
Document codes: WT/DS26/29
Complainant: U.S.
Respondent: EU
Third parties: Australia, Canada, New Zealand, Norway
Dispute stage: Implementation & Compliance
Agreements cited: Art. III, XI  GATT 1994Art. 2  Technical Barriers to Trade (TBT)Art. 4  AgricultureArt. 2, 3, 5  Sanitary and Phytosanitary Measures (SPS)

EUROPEAN COMMUNITIES – MEASURES CONCERNING
MEAT AND MEAT PRODUCTS (HORMONES)
JOINT COMMUNICATION FROM THE EUROPEAN UNION AND THE UNITED STATES
The following communication, dated 14 April 2014, from the delegations of the European Union
and the United States to the Chairperson of th e Dispute Settlement Body, is circulated at the
request of those delegations.

The United States and the European Union previo usly notified the Dispute Settlement Body (DSB)
of a Memorandum of Understanding (MOU) regarding the importation of beef from animals not
treated with certain growth-promoting hormones and increased duties applied by the United States
to certain products of the European Communities, agreed between the United States and the
European Communities on 13 May 2009, in relation to the dispute European Communities –
Measures Concerning Meat and Meat Products (Hormones) (DS26). The MOU was circulated in
 Attached please find a revised MOU agreed between the United States and the
European Union, dated 21 October 2013.

We would be grateful if this revised MOU could be circulated to the Dispute Settlement Body.

ARTICLE I

Purpose and Objectives

With this Understanding, the United States and the European Union intend to achieve the following
objectives:

1. To provide, in a first phase ("Phase 1"), for temporary and partial:

(a) expansion by the EU of market access for High Quality Beef, and

(b) reduction in the level of increased duties applied by the United States to certain EU products
authorized by the WTO in 1999 (the "increased duties")

in order for the Parties to gain experience in addi tional trade in High Quality Beef and facilitate a
transition to long-term conditions;

2. To provide the opportunity to move to a second phase ("Phase 2"), for:

(a) further expansion by the EU of market access for High Quality Beef, and

(b) reduction to zero of the increased duties

in order for the Parties to gain experience in additional expanded trade in High Quality Beef and
facilitate a transition to long-term conditions; and

3. To provide the further opportunity for entering into a third phase ("Phase 3") with regard to
the WTO dispute between the Parties, EC – Measures Concerning Meat and Meat Products
(Hormones).

ARTICLE II

Core Obligations

1. At the beginning of Phase 1, the EU will establish an autonomous tariff rate quota for High
Quality Beef of an annual quantity of 20 000 Metric Tonnes product weight, and for which
the in-quota tariff rate is zero (0) %.

2. The EU will open the autonomous tariff rate quota referred to in paragraph 1
by 3 August 2009.

3. With respect to the increased duties, the Un ited States will not add to scope, change the
origin of products subject to increased duties or increase the level of such duties as in force
as of 23 March 2009.

4. Should the United States and the EU enter in to Phase 2, as described in Article I.2, and
negotiated under Article IV.2:

(a) the EU will increase the quantity of the autonomous tariff rate quota referred to in
paragraph 1 to 45 000 Metric Tonnes product weight, and

(b) the United States will suspend all increased duties imposed in connection with WTO dispute
settlement proceedings in EC – Measures Concerning Meat and Meat Products (Hormones).

5. Should the United States and the EU enter in to Phase 3, as described in Article I.3, and
negotiated under Article IV.3:

(a) the EU will maintain the quantity of the autonomous tariff rate quota referred to in
paragraph 1, at the level specified in paragraph 4(a), and

(b) the United States will cease the increased duties imposed in connection with WTO dispute
settlement proceedings in EC – Measures Concerning Meat and Meat Products (Hormones).

ARTICLE III

Quota Management

1. The Parties agree that the tariff rate quota re ferred to in Article II will be administered by
the Commission on a first-come, first-served basis.

2. The Commission will implement and administer the tariff rate quota set out in this
Understanding in accordance with Article XIII of the General Agreement on Tariffs and Trade
(GATT) 1994, including its interpretative note s. The Commission will make every effort to
administer the tariff rate quota referred to in Article II in a manner that allows importers to
fully utilize it.

ARTICLE IV

Monitoring and Consultations

1. The United States and the EU will:

(a) monitor and review the operation of this Understanding, and

(b) upon the request of either Party, conduct additional bilateral consultations regarding the
operation of this Understanding, including issues of quota management, not later than
thirty (30) days following the receipt of the request in writing for consultations.

2. The United States and the EU will, beginning not later than eighteen (18) months from the
date specified in Article II.2, meet to review the operation of Phase 1 with a view to entering
into Phase 2.

3. Should the United States and the EU enter in to Phase 2, the United States and the EU will,
beginning not later than six (6) months from the date on which the EU implements the
obligation set out in Article II.4(a), meet to re view the operation of Phase 2 with a view to
entering into Phase 3. This review will notably cover, inter alia, the following issues:

(a) the duration of Phase 3,

(b) the status and effects of the Understanding relative to the Understanding on Rules and
Procedures Governing the Settlement of Disputes (DSU),

(c) the consequences of non-compliance with the terms of the Understanding by either Party,
and

(d) the status and disposition of any dispute settlement proceeding in EC – Measures
Concerning Meat and Meat Products (Hormones).

4. After concluding the review referred to in para graph 3, if the Parties agree on conditions for
entering into Phase 3, the Parties may, by applying the procedure set out in Article V.5,
amend the Understanding in order to reflect the agreed conclusions of that review. Such an
amendment will not alter the core obligations as referred to in Article II.5.

5. As part of this review, the Parties have agreed to modify this Understanding on
21 October 2013.

ARTICLE V

Duration, Withdrawal and Amendment

1. Phase 1 will have a duration of three (3) years from the date specified in Article II.2.

2. Phase 2 will have a duration of three (3) years from the date the Parties entered into
Phase 2.

3. Phase 3 shall begin upon a notification to the WTO Dispute Settlement Body to this effect.

4. Either the United States or the EU may wi thdraw from this Understanding by providing
written notice to the other Party. Should either Party provide such written notice, this
Understanding shall expire six (6) months from the date such notice was provided. Should
both Parties provide such written notice, this Agreement shall expire six (6) months from the
earliest of the dates on which such notice was provided. During this six (6) month period,
the core obligations, as defined in Article II, applicable at the time of the provision of the
withdrawal notice, will be maintained by both Parties.

5. The United States and the EU may amend this Understanding by mutual agreement in
writing.

ARTICLE VI

Definitions

For the purposes of this Understanding, "High Quality Beef" means:

"Beef cuts obtained from carcasses of heifers and steers less than 30 months of age which have
only been fed a diet, for at least the last 100 days before slaughter, containing not less than 62 %
of concentrates and/or feed grain co-products on a dietary dry matter basis that meet or exceed a
metabolisable energy (ME) content greater than 12,26 megajoules (MJ) per one kilogram of dry
matter. The heifers and steers fed this diet shall be fed, on average, not less than 1,4 % of live
body weight per day on a dry matter basis.

The carcass from which beef cuts are derived shal l be evaluated by an evaluator employed by the
national government who bases the evaluation, and a resulting classification of the carcass, on a
method approved by the national government. The national government evaluation method, and
its classifications, must evaluate expected carcass quality using a combination of carcass maturity
and palatability traits of the beef cuts. Such an ev aluation method of the carcass shall include, but
not be limited to, an evaluation of the maturity characteristics of color and texture of the
longissimus dorsi muscle and bone and cartilage ossification, as well as an evaluation of expected
palatability traits including a combination of the discrete specifications of intramuscular fat and
firmness of the longissimus dorsi muscle.

The cuts shall be labeled in accordance with Article 13 of Regulation (EC) No. 1760/2000.

The indication 'High Quality Beef' may be added to the information on the label."

ARTICLE VII

Reservation of Rights

1. Neither Party will request the establishment of a panel under Article 21.5 of the DSU in EC –
Measures Concerning Meat and Meat Products (Hormones) during Phase 2 or Phase 3 of
this Understanding.

2. Neither this Understanding nor the Parties' taking of any of the steps contemplated by this
Understanding prejudices the disagreement be tween the Parties regarding whether the DSB
recommendations and rulings in EC – Measures Concerning Meat and Meat Products
(Hormones) have been implemented.

3. Other than as specifically set forth herein, this Understanding is without prejudice to the
rights and obligations of the United States and the EU under the WTO agreements.

ARTICLE VIII

Relation with WTO Rights

1. The Parties envisage that Phase 3 would in volve termination of the authorization under
Article 22.7 of the DSU, made by the DSB at its meeting of July 26, 1999, and that no
further action under the DSU with respect to DS26 would be taken.

2. This Understanding and the step under the DSU referred to in paragraph 1 are without
prejudice to any Party's right to initiate a new dispute under the DSU.