EUROPEAN UNION AND ITS MEMBER STATES – CERTAIN MEASURES RELATING TO THE ENERGY SECTOR NOTIFICATION OF AN APPEAL BY THE EUROPEAN UNION UNDER ARTICLE 16.4 AND ARTICLE 17 OF THE UNDERSTANDING ON RULES AND PROCEDURES GOVERNING THE SETTLEMENT OF DISPUTES (DSU), AND UNDER RULE 20(1) OF THE WORKING PROCEDURES FOR APPELLATE REVIEW
Document: AND PROCEDURES GOVERNING THE SETTLEMENT OF DISPUTES (DSU), AND UNDER RULE 20(1) OF THE WORKING PROCEDURES FOR APPELLATE REVIEW
Date: 25 September 2018
Document codes: WT/DS476/6
Complainant: Russia
Respondent: EU
Third parties: Brazil, China, India, Japan, Ukraine, U.S., Colombia, South Korea, Saudi Arabia
Dispute stage: Panel
Agreements cited: Art. XVI:1, XVII  Services (GATS)Art. III:4  GATT 1994Art. II:1, VI:1, VI:5(a)  Services (GATS)Art. I:1, XI:1, X:3(a)  GATT 1994Art. XVI  Services (GATS)

EUROPEAN UNION AND ITS MEMBER STATES – CERTAIN MEASURES RELATING
TO THE ENERGY SECTOR
NOTIFICATION OF AN APPEAL BY THE EUROPEAN UNION UNDER
ARTICLE 16.4 AND ARTICLE 17 OF THE UNDERSTANDING ON RULES
AND PROCEDURES GOVERNING THE SETTLEMENT OF DISPUTES (DSU),
AND UNDER RULE 20(1) OF THE WORKING PROCEDURES FOR APPELLATE REVIEW
The following communication, dated 21 September 2018, from the delegation of the European Union,
is being circulated to Members.

Certain Measures relating to the Energy Sector () concerning the third -country
certification measure, the infrastructure exemption measure and the TEN –E measure. Pursuant to
Rule 23(1) of the Working Procedures for Appellate Review, the European Union simultaneously files
this Notice of Appeal with the Appellate Body Secretariat.
2. For the reasons to be further elaborated in its submissions to t he Appellate Body, the
European Union appeals, and requests the Appellate Body to reverse or declare moot and of no legal
effect the findings and conclusions of the Panel with respect to the errors of law and legal
interpretations contained in the Panel Report described below, and where indicated to complete the
analysis on the basis of the Panel's findings and uncontested facts on the record.1
I. THE THIRD-COUNTRY CERTIFICATION MEASURE
3. The European Union appeals the Panel's conclusion 2 and related findings 3 that the
third-country certification measure, as implemented in the national laws of Croatia, Hungary a nd
Lithuania, is inconsistent with Article XVII of the GATS and is not justified under the general
exception in Article XIV(a) of the GATS.
4. This conclusion is based on the Panel's erroneous finding that the third -country certification
measure, as implemented in the provisions of the laws of the three EU Member States cited above,
is not applied consistently with the chapeau of Article XIV of the GATS4.
5. In making this finding the Panel erred in the interpretation and application of the chapeau of
Article X IV of the GATS. More precisely, the Panel erred by holding that the lack of an

1 Pursuant to Rule 20(2)(d)(iii) of the Working Procedures for Appellate Review this Notice of Appeal
includes an indicative list of the paragraphs of the Panel Report containing the alleged errors, without prejudice
to the ability of the European Union to refer to other paragraphs of the Panel Report in the context of its
appeal.
3 Including the finding in Panel report, para. 7.1254 and the supporting reasoning in paras. 7.1241-
7.1253.
4 Panel report, para. 7.1254.

ex-ante mechanism for assessing the threats to the security of gas supply posed by TSOs controlled
by persons of an EU Member constitutes a means of "arbitrary or unjustifiable discrimination".5
6. The European Union requests the Appellate Body to reverse the appealed conclusion and
related findings concerning the third-country certification measure and to find that the third-country
certification measure is justified under Article XIV (a) of the GATS.
II. THE INFRASTRUCTURE EXEMPTION MEASURE
7. The European Union appeals the Panel's findings and conclusion that the two challenged
OPAL conditions within the 2009 OPAL exemption decision are inconsistent with Article XI:1 of the
GATT 1994.6 The Panel erre d in finding that "the two challenged OPAL conditions restrict market
access for EU imports of natural gas from Russia and limit competitive opportunities for importation
of Russian natural gas into the European Union".7
8. The Panel's findings that the condi tions relating to the 50% capacity cap and the 3 bcm/yr
gas release programme have a limiting effect on the importation of natural gas from Russia 8 are
erroneous because the two conditions were examined in isolation from the generally applicable
provisions of EU law that provide their context. The effects of those conditions, which concern access
to the OPAL pipeline 's capacities, must be assessed in the context of Directive 's rules that require
third-party access to the gas transmission and distribution sy stem (Article 32) and allow partial
exemptions to be granted to major new infrastructure (Article 36).
9. The Panel erred in failing to examine the two challenged OPAL conditions in their regulatory
context and in mischaracterizing them as a measure on the importation of goods within the meaning
of Article XI:1 of the GATT 1994.
10. In the alternative, the European Union argues that, in any event, the Panel erred in finding
that those conditions have a limiting effect on the importation of natural gas from Russia.9
11. The European Union requests the Appellate Body to reverse the Panel's findings and conclusion
that the challenged OPAL conditions (that is, the 50% capacity cap and 3 bcm/yr gas release
programme) are inconsistent with Article XI:1 of the GATT 1994.10
III. THE TEN-E MEASURE
12. The European Union appeals the Panel's conclusion 11 and related findings 12 that the
TEN-E measure is inconsistent with Article III: 4 of the GATT 1994. This conclusion is based on the
Panel's erroneous finding that the TEN –E measure accor ds "less f avourable treatment" to
Russian natural gas than to like natural gas of EU origin13.
13. The European Union also appeals the Panel's conclusion 14 and related findings 15 that the
TEN-E measure is inconsistent with Article I:1 of the GATT 1994. This conc lusion is based on the
Panel's erroneous finding that the TEN–E measure accords an "advantage" to imports of natural gas
originating in countries other than Russia16.

5 Panel report, paras. 7.1252-7.1253.
6 Panel report, paras. 7.980 -7.1003 and 8.1.d.iii.
7 Panel report, para. 7.1002.
8 Panel report, paras. 7.1000 -7.1002.
9 Panel report, para. 7.1001.
10 Panel report, paras. 7.980 -7.1003 and 8.1.d.iii.
11 Panel report, para. 8.1.g.
12 Including Panel report, paras. 7.1285, 7.1299-7.1301 and supporting reasoning in paras. 7.1267-
7.1286 and 7.1314-7.1324.
13 Panel report, para. 7.1300.
14 Panel report, para. 8.1.g.
15 Including Panel report, paras. 7.1285, 7.1311-7.1313 and supporting reasoning in paras. 7.1267-
7.1286 and 7.1314-7.1324.
16 Panel report, para. 7.1312.

14. In making these two findings the Panel erred in law in the following two ways:
• first, by relying on an erroneous legal standard for establishing the existence of "less
favourable treatment", for the purposes of Article III:4 of the GATT 1994, and of an
"advantage", for the purposes of Article I:1 of the GATT 1994; and
• second, by excl uding a priori from its analysis the legal relevance of the existing
infrastructures for transporting natural gas.
15. In addition, when developing its analysis under both Article III:4 and I:1 of the GATT 1994
the Panel acted inconsistently with Article 11 o f the DSU by failing to conduct an objective
assessment of the facts of the case:
• first, the Panel failed to consider the detailed evidence and arguments submitted by the
European Union with regard to the actual implementation of the TEN –E measure and, as
a result, failed to undertake a "holistic assessment" of "all the relevant elements" in order
to ascertain the meaning and expected operation of the TEN–E measure;
• second, the Panel's analysis relied on the import statistics provided by the European Union
as Exhibit EU - 190. Yet the Panel misunderstood those statistics and drew conclusions
that are not properly based on that evidence.
16. Should the Appellate Body reverse the Panel's findings that the TEN–E measure is inconsistent
with Article III:4 of the G ATT 1994 and Article I:1 of the GATT 1994, the European Union further
requests the Appellate Body to declare moot and of no legal effect the Panel 's conclusion that the
TEN–E measure is not justified under Article XX (j) of the GATT 199417.
17. In the event that the Appellate Body upheld the Panel's findings that the TEN –E measure is
inconsistent with Article III:4 of the GATT 1994 and/or with Article I:1 of the GATT 1994, the
European Union appeals the Panel's conclusion that the TEN –E measure is not justifi ed under
Article XX (j) of the GATT 1994 18. This conclusion stems from an erroneous legal interpretation of
the terms "in short supply" in Article XX (j) of the GATT 1994, according to which the terms
"'products in general or local short supply' do not cove r products at risk of being in short supply"
and only products that are "currently" in short supply can be considered to be "in short supply".
18. Should the Appellate Body reverse the Panel's erroneous legal interpretation of the terms "in
short supply", the European Union further requests the Appellate Body to complete the analysis of
the TEN–E measure in the light of remaining elements of the legal standard under Article XX (j) of
the GATT 1994 and to find that the TEN–E measure is justified under that provision.