EUROPEAN COMMUNITIES AND ITS MEMBER STATES – TARIFF TREATMENT OF CERTAIN INFORMATION TECHNOLOGY PRODUCTS
Document: Request for Consultations by Chinese Taipei
Date: 16 June 2008
Document codes: WT/DS377/1; G/L/853
Complainant: Taiwan
Respondent: EU
Third parties: Australia, Brazil, China, Costa Rica, Hong Kong, India, Japan, South Korea, Philippines, Singapore, Thailand, Turkey, U.S., Vietnam
Dispute stage: Panel
Agreements cited: Art. II:1, X:1, X:2, XXIII  GATT 1994

EUROPEAN COMMUNITIES AND ITS MEMBER STATES – TARIFF TREATMENT
OF CERTAIN INFORMATION TECHNOLOGY PRODUCTS

Request for Consultations by Chinese Taipei

 The following communication, dated 12 June 20 08, from the delegation of Chinese Taipei to
the delegation of the European Communities and to the Chairman of the Dispute Settlement Body, is
circulated in accordance with Article 4.4 of the DSU.

 My authorities have instructed me to request consultations with the European Communities
(EC) and its member States pursuant to Article 4 of the Understanding on Rules and Procedures
Governing the Settlement of Disputes (DSU) and Article XXII:1 of the General Agreement on Tariffs
and Trade 1994 (GATT 1994) regarding the tariff treatment the EC and its member States accord to
flat panel displays, set-top boxes (STBs) with a communication function, and "input or output units"
and facsimile machines.

As a participant to the Ministerial Declaration on Trade in Information Technology Products ,
or "ITA" (Information Technology Agreement)
1, the EC and its member States modified their
Schedules of Concessions to the GATT 1994 (Schedul es) to reflect the commitments made under the
ITA.2 Such modifications became effective 2 July 1997. 3 Accordingly, the EC and its member States
shall grant duty-free treatment for the aforemen tioned products. However, as a result of the
application of certain EC measures, the EC and its member States do impose duties on these products.

This request for consultations is intended to address the EC's measures as described herein.
This request also covers any amendments or extens ions to these measures as well as any related laws,
regulations, practices and implementing measures.

The measures pursuant to which the EC and its member States impose duties include those
under the following headings:

Flat panel displays
On 31 March 2005, the EC published Council Re gulation (EC) No 493/2005, which provides
that certain flat panel displays using LCD tec hnology capable of reproducing video images from a
source other than an automatic data-processing machin e would not be covered by the ITA or by the

1 Ministerial Declaration on Tr ade in Information Technology Products, 13 December 1996
(WT/MIN(96)/16), see also Implementation of the Minist erial Declaration on Trade in Information Technology
Products, 2 April 1997 (G/L/160).
2 G/MA/TAR/RS/16 (2 April 1997).
3 WT/Let/156 (15 August 1997).

Communication on its implementation (Counc il Decision 97/359/EC of 24 March 1997).
4 O n
26 April 2005, the EC published Commission Regulation (EC) No 634/2005, which provides that flat
panel displays with certain attributes would be classified as dutiable.
5 On 29 December 2005, the EC
published Commission Regulation (EC) No 2171/2005, which also provides that certain flat panel
displays would be classified as dutiable if they had certain attributes. 6 On 30 December 2006, the EC
published Uniform Application of the Combined No menclature (2006/C 332/05) providing that flat
panel displays with certain attributes may not be granted duty-free and would be classified as
dutiable.7

 As a result of the measures at issue, EC member States assess duties on certain flat panel
displays.

Furthermore, although the EC has temporarily su spended the collection of duties on some flat
panel displays, including certain parts thereof, it still appears to fail to accord tariff treatment that is
no less favourable than that provided for in its Schedule.
STBs with a communication function

On 7 May 2008, the EC published an amendmen t to the Explanatory Notes to the EC's
Combined Nomenclature (CN), which provides that the duty-free heading CN 8528 71 ("set-top boxes
with a communication function") does not include STBs with modems of certain types (e.g ., Ethernet
modems) or STBs which incorporate a device perform ing a recording or reproducing function (e.g., a
hard disk or DVD drive).
8 Moreover, in the same amendment, the EC added an explanatory note to
accompany CN 8521 90 00 indicating that this subhe ading includes STBs which incorporate a device
performing a recording or reproducing function (e.g., a hard disk or DVD drive).9
 As a result of the measures at issue, EC member States assess duties on STBs with a
communication function.

"Input or output units" and facsimile machines

On 9 March 1999, the EC published Commis sion Regulation (EC) No 517/1999, which
provides that certain "output units" would be classified as dutiable.10 Moreover, on 9 March 2006, the
EC published Commission Regulation (EC) No 400/2006 , which provides that certain "output units"
or facsimile machines would be classified as dutiable. 11 Also, the EC Customs Code Committee
further issued a statement indicating that if a mu ltifunctional device (fax, prin ter, scanner, copier) has
the capability of photocopying in black and white 12 or more pages per minute (A4 format), it would
be classified as photocopying apparatus. 12 Subsequent to that statement, on 31 October 2006, the EC

4 Council Regulation (EC) No 493/2005 of 16 March 2005, O.J. L 82 (31 March 2005), pp. 1-2.
5 Commission Regulation (EC) No 634/2005 of 26 April 2005, O.J. L 106 (27 April 2005), pp. 7-9.
6 Commission Regulation (EC) No 2171/2005 of 23 December 2005, O.J. L 346 (29 December 2005),
pp. 7-9.
7 Uniform Application of the Combined Nomeclature (CN) (Classification of goods), 2006/C 332/05,
O.J. C 332 (30 December 2006), pp. 7-9.
8 Explanatory Notes to the Combined Nomenclature of the European Communities, 2008/C 112/03,
O.J. C 112 (7 May 2008), pp. 8-9.
9 Explanatory Notes to the Combined Nomenclature of the European Communities, 2008/C 112/03,
O.J. C 112 (7 May 2008), pp. 8-9.
10 Commission Regulation (EC) No 517/1999 of 9 March 1999, O.J. L 61 (10 March 1999), pp. 23-24.
11 Commission Regulation (EC) No 400/2006 of 8 March 2006, O.J. L 70 (9 March 2006), pp. 9-11.
12 Customs Code Committee, Tariff and Statistical Nomenclature Section, Report of conclusions of the
360th meeting of the Committee, TAXUD/555/2005-EN, Annex VII (March 2005).

published Commission Regulation (EC) No 1549/2006, which provides that certain "output units" or
facsimile machines capable of copying more than 12 monochrome pages per minute would be
classified as dutiable.13
 As a result of the measures at issue, EC me mber States assess duties on certain "output units"
or facsimile machines.

 The Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu considers that the
aforementioned measures at issue taken by the EC concerning flat panel displays, STBs with a
communication function, and "input or output units," and facsimile machines appear to be inconsistent
with the EC and its member States' obligations under Articles II:1(a) and II:1(b) of the GATT 1994
and their Schedules. The measures in question al so nullify or impair, within the meaning of
Article XXIII:1 of the GATT 1994, benefits accruing to the Separate Customs Territory of Taiwan,
Penghu, Kinmen and Matsu directly or indirectly under the GATT 1994.

In addition, with respect to STBs, the Tariff and Statistical Nomenclature Section of the
Customs Code Committee delivered favorable opinions with respect to the proposed amendments to
the Explanatory Notes contained in 2008/C 112/03 in October 2006 and May 2007, respectively. It
did not publish the amended explanatory notes in the EC Official Journal until 7 May 2008.
Furthermore, EC member States were applying du ties to STBs using the approach specified in
2008/C 112/03 prior to 7 May 2008. The Separate Customs Territory of Taiwan, Penghu, Kinmen
and Matsu considers that these actions appear to be inconsistent with th e EC's obligations under
Articles X:1 and X:2 of the GATT 1994.

The Separate Customs Territory of Taiwan, Pe nghu, Kinmen and Matsu reserves the right to
raise additional facts and claims regarding th e above-mentioned measures during the course of
consultations.

My authorities look forward to receiving your reply to this request and to fixing a mutually
acceptable date for consultations.