INDIA – ADDITIONAL AND EXTRA-ADDITIONAL DUTIES ON IMPORTS FROM THE UNITED STATES
Document: Request for the Establishment of a Panel by the United States
Date: 25 May 2007
Document codes: WT/DS360/5
Complainant: U.S.
Respondent: India
Third parties: Australia, Chile, EU, Japan, Vietnam
Dispute stage: Appellate Body
Agreements cited: Art. II:1, III:2, III:4  GATT 1994

INDIA – ADDITIONAL AND EXTRA-ADDITIONAL DUTIES ON
IMPORTS FROM THE UNITED STATES

Request for the Establishment of a Panel by the United States

 The following communication, dated 24 May 2007, from the delegation of the United States
to the Chairman of the Dispute Settlement Body, is circulated pursuant to Article 6.2 of the DSU.

On 6 March 2007, the United States requested c onsultations with the Government of India
pursuant to Article 4 of the Understanding on Rules and Procedures Governing the Settlement of
Disputes ("DSU") and Article XXII of the General Agreement on Tariffs and Trade 1994
("GATT 1994"), with respect to "additional duties" a nd "extra additional duties" that India applies to
imports from the United States. The United States held consultations with India on 13 April 2007.
Unfortunately, those consultations did not resolve the dispute.

The additional duty and extra additional duty, individually and in combination, subject
imports to ordinary customs duties or other duties or charges in excess of those in India's WTO Tariff
Schedule. The additional duty is calculated inclusive of, and applied in addition to, the basic customs
duty. The extra additional duty is calculated incl usive of, and applied in addition to, the basic
customs duty and the additional duty. As a result of the additional duty and the extra additional duty,
products from the United States are not exempt from ordinary customs duties or other charges in
excess of those set forth in India's WTO Tariff Sc hedule, and are accorded less favorable treatment
than that provided for in India's WTO Tariff Sche dule. Therefore, the United States considers the
additional duty and the extra additiona l duty each to be inconsistent with Article II:1(a) and (b) of the
GATT 1994. India applies these duties to products that include, but are not limited to, imports falling
under Harmonized Tariff System (HTS) Codes 2203, 2204, 2205, 2206, and 2208 (beer, wine and
distilled spirits, collectively referred to as "alcoholic beverages").

Even if the additional duty and the extra additiona l duty were considered to be internal taxes
applied at the time of importation, these duties subject imports from the United States to internal taxes
in excess of those applied to lik e domestic products or directly co mpetitive or substitutable domestic
products in breach of Article III:2 of the GATT 1994, and afford less favorable treatment to imported
products than to like domestic products in breach of Article III:4 of the GATT 1994.

The United States understands that the relevant Indian measures include:
• Chapter V of the Customs Act, 1962
• Sections 2 and 3 of the Customs Tariff Act, 1975 ("basic customs duty,"
"additional duty" and "extra additional duty");

• First Schedule to the Customs Tariff Ac t, 1975 and any customs notifications
issued under section 25 of the Customs Act, 1962 that set forth applied rates of
basic customs duties for alcoholic beverages and other imports from the
United States that differ from rates specified in the First Schedule including:
• Customs Notification No. 5/2004 (8 January 2004) and Customs Notification
No. 11/2005 (1 March 2005) ("basic customs duty" inter alia on HTS
code 2208, distilled spirits );
• Customs Notification No. 20/1997 (1 March 1997) ("basic customs duty"
inter alia on HTS codes 2203, 2204, 2205 and 2206, beer and wine);
• Customs Notification No. 32/2003 (1 March 2003) ("additional duty" on
alcoholic beverages); and
• Customs Notification No. 19/2006 (1 March 2006) ("extra additional duty"
inter alia on alcoholic beverages)

as well as any amendments, related measures, or implementing measures.

These measures appear to be inconsistent with India's obligations under provisions of the
GATT 1994, in particular with:

(1) Article II:1(b) of the GATT 1994, by imposing an additional duty on imports from the
United States in addition to the basic customs duty applied to such imports that results in
ordinary customs duties, or other duties or charges imposed on or in connection with
importation, in excess of those set forth in India's WTO Tariff Schedule;

(2) Article II:1(a) of the GATT 1994, by imposi ng an additional duty on imports from the United
States in addition to the basic customs duty applied to such imports that accords less favorable
treatment to such imports than provided for in India's WTO Tariff Schedule;

(3) Article II:1(b) of the GATT 1994, by imposi ng an extra additional duty on imports from the
United States in addition to the basic customs duty on such imports that results, alone or in
combination with the additional duty, in ordina ry customs duties, or other duties or charges
imposed on or in connection w ith importation, in excess of those set forth in India's WTO
Tariff Schedule; and

(4) Article II:1(a) of the GATT 1994, by imposi ng an extra additional duty on imports from the
United States in addition to the basic cust oms duty on such imports, that, alone or in
combination with the additional duty, accords l ess favorable treatment to such imports than
provided for in India's WTO Tariff Schedule;

and to the extent that the measures impose an internal tax or other charge on imported products,

(5) Article III:2 of the GATT 1994; and

(6) Article III:4 of the GATT 1994.

In addition, India's measures appear to nullif y or impair the benefits accruing to the
United States directly or indirectly under the GATT 1994.

Accordingly, the United States respectfully request s, pursuant to Article 6 of the DSU, that
the Dispute Settlement Body establish a panel to ex amine this matter, with the standard terms of
reference as set out in Article 7.1 of the DSU.