BRAZIL – CERTAIN MEASURES CONCERNING TAXATION AND CHARGES UNDERSTANDING BETWEEN BRAZIL AND JAPAN REGARDING PROCEDURES UNDER ARTICLES 21 AND 22 OF THE DSU
Document: Agreed Procedures
Date: 9 January 2020
Document codes: WT/DS497/15
Complainant: Japan
Respondent: Brazil
Third parties: Argentina, Australia, Canada, China, Colombia, EU, India, South Korea, Russia, Singapore, Turkey, Ukraine, U.S.
Dispute stage: Appellate Body
Agreements cited: Art. I:1, III:2, III:4, III:5  GATT 1994Art. 2.1, 2.2  Trade-Related Investment Measures (TRIMs)Art. III  GATT 1994Art. 3.1(b), 3.2, 1.1  Subsidies and Countervailing Measures (SCM)

BRAZIL – CERTAIN MEASURES CONCERNING TAXATION AND CHARGES
UNDERSTANDING BETWEEN BRAZIL AND JAPAN REGARDING PROCEDURES
UNDER ARTICLES 21 AND 22 OF THE DSU
The following communication, dated 27 December 2019 , from the delegation of Brazil and the
delegation of Japan to the Chairperson of the Dispute Settlement Body, is circulated at the request
of these delegations.

Brazil and Japan would like to inform the Dispute Settlement Body of the at tached "Agreed
Procedures under Articles 21 and 22 of the Understanding on Rules and Procedures Governing the
Settlement of Disputes" between Brazil and Japan with respect to the dispute Brazil － Certain
Measures Concerning Taxation and Charges (WT/DS497).

We request that you please circulate the attached agreement to the Members of the Dispute
Settlement Body.

Agreed Procedures under Articles 21 and 22 of the Understanding on Rules and Procedures
governing the Settlement of Disputes
Brazil － Certain Measures Concerning Taxation and Charges (WT/DS497)
The Dispute Settlement Body ("DSB") adopted its recommendations and rulings in the dispute
Brazil － Certain Measures Concerning Taxation and Charges (WT/DS497) on 11 January 2019.

Pursuant to Article 21.3(b) of the Understanding on Rules and Procedures Governing the Settlement
of Disputes ("DSU"), Brazil and Japan agreed that the reasonable period of time to implement the
recommendations and rulings of the DSB in this dispute shall be eleven (11) months and twenty (20)
days, expiring on 31 December 2019. With regard to the subsidies that were found to be prohibited,
Brazil and Japan agreed that, for the purposes of Article 4 of the Agreement on Subsidies and
Countervailing Measures ("SCM Agreement"), the time period within which these measures must be
withdrawn would be five (5) months and ten (10) days from the date of adoption of the
recommendations and rulings of the DSB, which expired on 21 June 2019 (WT/DS497/13).

Brazil and Japan (c ollectively, "the Parties") have agreed on the following procedures for the
exclusive purposes of this dispute. They are designed to facilitate the resolution of the dispute and
reduce the scope for procedural disputes and are without prejudice to either P arty's views on the
correct interpretation of the DSU, and without prejudice to any other arrangements that may be
agreed separately among the parties:

1. Should Japan consider that the situation described in Article 21.5 of the DSU exists, Japan will
request that Brazil enter into consultations with Japan. The Parties agree to hold such consultations
within 15 days from the date of receipt of the request. A fter this 15-day period has elapsed, Japan
may request the establishment of a panel pursuant to Article 21.5 of the DSU at any time.
2. At the first DSB meeting at which Japan's request for the establishment of an Article 21.5
panel appears on the agenda, Brazil shall accept the establishment of that panel.
3. The Parties shall cooperate to enable the Article 21.5 panel to circulate its report within
90 days of the panel's establishment, excluding such time during which the panel's work may be
suspended pursuant to Article 12.12 of the DSU.
4. Either Party may request the DSB to adopt the report of the Article 21.5 panel at a
DSB meeting held at least 20 days after the circulation of the report to the Members unless either
Party appeals the report.
5. In the event that a division of the Appellate Body can be composed to hear this dispute upon
an appeal of the Article 21.5 panel report, the Parties shall cooperate to enable the Appellate Body
to circulate its report to the Members within 90 days from the date of notificat ion of the appeal to
the DSB. Further, either Party may request the DSB to adopt the reports of the Appellate Body and
of the Article 21.5 panel (as modified by the Appellate Body report) at a DSB meeting held within
30 days of the circulation of the Appellate Body report to the Members.
6. Japan may request authorization to suspend concessions or other obligations pursuant to
Article 22.2 of the DSU and to adopt countermeasures pursuant to Article 4.10 of the
SCM Agreement, in the event that the DSB rules as a result of a proceeding under Article 21.5 of
the DSU that a measure taken to comply with the recommendations and rulings does not exist or is
inconsistent with a covered agreement. This is without prejudice to Brazil's right to refer the matter
to arbitration in accordance with Article 22.6 of the DSU.
7. If Japan requests authorization to suspend concessions or other obligations pursuant to
Article 22.2 of the DSU and to adopt countermeasures pursuant to Article 4.10 of the
SCM Agreement, Brazil shall hav e the right to object under Article 22.6 of the DSU to the level of
suspension of concessions or other obligations and/or claim that the principles and procedures set
forth in Article 22.3 of the DSU have not been followed. In the event of such objection, the matter
will be referred to arbitration pursuant to Article 22.6 of the DSU.

8. The Parties will cooperate to enable the arbitrator under Article 22.6 of the DSU to circulate
its decision within 60 days of the referral to arbitration.
9. If any of the original panelists is not available for either the Article 21.5 compliance panel or
the Article 22.6 arbitration (or both), or any person serving in such proceeding becomes unavailable
to serve, the Parties will promptly consult on a replacement, and either Party may request the
Director-General of the WTO to appoint, within ten days of being so requested, a replacement for
the proceeding or proceedings in which a replacement is required. If an original panelist is
unavailable to serve in either of the proceedings , or a person serving in such proceeding becomes
unavailable to serve, the Parties will further request that, in making this appointment, the
Director-General seek a person who will be available to act in both proceedings.
10. The Parties will continue to coop erate in all matters related to these agreed procedures and
agree not to raise any procedural objection to any of the steps set out herein. If, during the
application of these procedures, the Parties consider that a procedural aspect has not been properly
addressed in these procedures, they will endeavor to find a solution within the shortest time possible
that will not affect the other aspects and steps agreed herein.