Delegation of the European Union to Namibia

EU Statement at the Regular Dispute Settlement Body meeting, 29 July 2020

Geneva, 29/07/2020 - 00:00, UNIQUE ID: 200729_9
Local Statements

AGENDA POINT 1: SURVEILLANCE OF IMPLEMENTATION OF RECOMMENDATIONS ADOPTED BY THE DSB

B. UNITED STATES – SECTION 110(5) OF THE US COPYRIGHT ACT: STATUS REPORT BY THE UNITED STATES (WT/DS160/24/ADD.180)


⦁    We thank the United States for its status report and its statement today.

⦁    We refer to our previous statements. We would like to resolve this case as soon as possible.


AGENDA POINT 1: SURVEILLANCE OF IMPLEMENTATION OF RECOMMENDATIONS ADOPTED BY THE DSB


C. EUROPEAN COMMUNITIES – MEASURES AFFECTING THE APPROVAL AND MARKETING OF BIOTECH PRODUCTS: STATUS REPORT BY THE EUROPEAN UNION (WT/DS291/37/ADD.143)

First intervention

⦁    The EU continues to progress with the authorisations where the European Food Safety Authority has finalised its scientific opinion and concluded that there are no safety concerns.

⦁    The EU has a solid record on the authorisation of GMO requests: last year, eighteen decisions were adopted to authorise 65 new GMOs for feed and food, 6 GMOs were renewed and one GM cut flower was authorised.

⦁    As repeatedly explained by the EU and confirmed by the US delegation during the EU-US biannual consultations held on 12 June 2019, efforts to reduce delays in authorisation procedures are constantly maintained at a high level at all stages of the authorisation procedure.

⦁    The United States frequently refers to what is known as the EU “opt-out Directive”. We would like to reiterate that the DSB recommendations and rulings do not cover the “opt-out Directive”.

⦁    In the last DSB meeting, the United States claimed that 13 applications are awaiting risk management decisions. This figure needs to be put into perspective. For 3 applications for which EFSA has recently published the opinions, these were not fully conclusive, and at the moment no full scope authorisations can be granted. More specifically, for one application, the Commission intends to discuss further with the Member States the feasibility of implementation and controls in the event of a partial authorisation. For a second one, the applicant still has to provide a mandatory study that complies with the relevant legal requirements, and for the third one, the applicant has requested the Commission to wait that EFSA finalise the risk assessment of the corresponding stack. Finally, nine applications with an EFSA positive opinion are in internal procedures and will be presented for vote as soon as these procedures are finalised. The next Standing Committee on genetically modified food and feed will take place on 15 September 2020.

⦁    As the United States seems to refer to the cancellation of meetings of the Standing Committee as deliberate delays, it is important to understand that for logistical reasons the meetings of the different sections of the Standing Committee are scheduled a year beforehand. However, these meetings are only confirmed closer to the planned date. The effect of Covid-19 restrictions should not be underestimated. In spite of the current context and related priorities and of the challenging working conditions, the European Union continues working on authorisation files.

⦁    The EU acts in line with its WTO obligations. Finally, we recall that the EU approval system is not covered by the DSB's recommendations and rulings.
Second intervention

⦁    The WTO Agreements does not require full international harmonisation and leave some regulatory space or autonomy to individual WTO Members. The European Union has different regulatory approaches to non-GMOs and GMOs but, in all cases, such regulations do not discriminate between imported and domestic like products.

⦁    No EU Member State has imposed any “ban”. Under the terms of the Directive, an EU Member State can adopt measures restricting or prohibiting cultivation only when such measures are in line with EU law and are reasoned, proportional, non-discriminatory and based on compelling grounds.

⦁    The free movement of seeds is embedded in Article 22 of Directive 2001/18/EC: ‘Member States may not prohibit, restrict or impede the placing on the market of GMOs, as or in products, which comply with the requirements of this Directive’. We also note that according to the provisions of the opt-out Directive (Article 26b, point 8) the measures adopted under the Directive ‘shall not affect the free circulation of authorised GMOs’ in the EU.

⦁    Currently the EU Common Catalogue of varieties of agricultural species includes 150 varieties of maize MON 810, which are allowed to be marketed in the EU. Until today, the Commission has never received any complaints from seed operators or other stakeholders concerning the restriction of marketing of MON810 seeds in the EU. This confirms the smooth functioning of the internal market of MON810 seeds.

⦁    We would invite the US to provide any evidence they may have at their disposal substantiating the disruption of the free movement of MON810 seeds in the EU.

AGENDA POINT 2: UNITED STATES – CONTINUED DUMPING AND SUBSIDY OFFSET ACT OF 2000: IMPLEMENTATION OF THE RECOMMENDATIONS ADOPTED BY THE DSB

A. STATEMENT BY THE EUROPEAN UNION

•    On 1 May 2020 the EU adjusted the level of suspension to the nullification or impairment caused by the CDSOA to the European Union. The adjustment maintains unchanged the list of products subject to retaliation while increasing the rate of additional duty to which those products are subjected to 0,012% in order to adjust to the level of retaliation. The letter informing of the adjustment, together with the Commission Delegated Regulation (EU) 2020/578 of 21 February 2020 was notified to the DSB on 26 June 2020.

⦁    The EU requests once again that the United States stops transferring antidumping and countervailing duties to the US industry. Even if the amounts have considerably decreased, the latest CDSOA report from December 2018 still shows that amounts are still being in practice disbursed.

•    Every disbursement that still takes place is clearly an act of non-compliance with DSB recommendations and rulings. As long as the US does not fully stop transferring collected duties, the item is rightly under the DSB's surveillance. We can assure you that, due to the long standing nature of this breach, the EU will continue to insist – as a matter of principle – independently of the cost resulting from the application of such limited duties.

•    The EU renews its call on the United States to abide by its clear obligation under Article 21.6 of the DSU to submit implementation reports in this dispute.

•    The EU will continue to put this point on the agenda as long as the US has not fully implemented the WTO ruling and the disbursements cease completely.

•    Once the transfers of anti-dumping and countervailing duties cease, so will the EU measures.


AGENDA POINT 3:  EUROPEAN COMMUNITIES AND CERTAIN MEMBER STATES – MEASURES AFFECTING TRADE IN LARGE CIVIL AIRCRAFT: IMPLEMENTATION OF THE RECOMMENDATIONS ADOPTED BY THE DSB

•    As in the previous DSB meetings, the US has again implied that the EU is taking inconsistent positions under Article 21.6 of the DSU, depending on whether the EU is a complaining party or a defending party in a dispute. The US also referred to the EU’s appeal filed against the report of the second compliance panel as an example of our “misguided approach.

•    Both US assertions are without merit.

•    As the EU has repeatedly explained in past meetings of the DSB, the crucial point for the defending party’s obligation to provide status reports to the DSB is the stage of the dispute. In the Airbus case, the dispute is at a stage where the defending party does not have an obligation to submit status reports to the DSB.

•    We would like to remind the DSB that in the Airbus case the EU notified a new set of compliance measures to the DSB. That new set of compliance measures were a clear demonstration that the EU – contrary to the US in the parallel Boeing-case – is serious about and committed to achieving compliance.

•    That new set of compliance measures were subject to an assessment by a compliance panel and that panel’s report was issued on 2 December 2019. As noted in our statement at the December meeting of the DSB, the EU is of the view that significant aspects of the compliance panel’s report cannot be regarded as legally correct and are very problematic from a systemic perspective when it comes to assessing compliance with the subsidy disciplines of the WTO agreements. It is in order to have these legal errors corrected, and not – as the US seems to imply – to continue litigation for the sake of litigation, that the EU has filed an appeal against the compliance panel’s report on 6 December 2019.

•    We are concerned that with the current blockage of the two-step multilateral dispute settlement system, we are losing the possibility of a proper appellate review of the serious flaws contained in the panel report. While the blockage continues, we stand ready to discuss with the US alternative ways to deal with this appeal. We are also committed to finding a balanced negotiated solution with the US that would allow leaving both aircrafts disputes behind us.

•    These considerations do not, however, alter the fact that the compliance proceeding in this dispute has not been concluded.

•    Whether or not the matter is “resolved” in the sense of Article 21.6 remains the very subject matter of this ongoing litigation. How can it be said that the defending party should submit “status reports” to the DSB in these circumstances?

•    The EU would be very concerned with a reading of Article 21.6 of the DSU that would require the defending party to notify the purported “status of its implementation efforts” through the submission of status reports to the DSB, while dispute settlement proceedings on that precise issue are ongoing. The EU notes that its reading of the provision is supported by other WTO Members.

•    The view of the EU is further supported by Article 2 of the DSU on the administration of the dispute settlement rules and procedures: where, further to the disagreement between the parties on compliance, a matter is with the adjudicators, it is temporarily taken out of the DSB’s surveillance.

•    Under Article 21.6 DSU, the issue of implementation shall remain on the DSB's agenda until the issue is resolved. In the Byrd Amendment case, the EU does not agree with the US assertion that it has implemented the DSB recommendations and rulings. This means that the issue remains unresolved for the purposes of Article 21.6 DSU. If the US does not agree the issue remains unresolved, nothing prevents it from seeking a multilateral determination through a compliance procedure, asking for a confirmation of its assertion that the CDSOA measure has been repealed in line with the WTO findings, just like the EU is doing in the Airbus case.

Second intervention

⦁    The EU does not agree with the US unilateral assertion that it has fully implemented the DSB recommendations and rulings in the Boeing dispute.

⦁    While the EU is still examining the impact of the legislative action concerning the Washington State B&O tax, the EU notes that the rulings in this dispute cover a number of additional measures where the US remains non-compliant (including NASA and Department of Defense Research and Development measures and certain State and local measures).

⦁    As already referred to in our previous interventions on the matter, following the Appellate Body report on compliance in the Airbus case, the EU notified a set of compliance measures to the WTO that brought us in compliance with the ruling. The US disagreed. On the basis of its disagreement the US continues to apply countermeasures against products from the EU. At the same time, the US is blocking the two-step multilateral dispute settlement system, thus depriving the EU from seeking a multilateral determination of compliance regarding its measures.

AGENDA POINT 4: INDIA – TARIFF TREATMENT ON CERTAIN GOODS IN THE INFORMATION AND COMMUNICATIONS TECHNOLOGY SECTOR

A.    REQUEST FOR THE ESTABLISHMENT OF A PANEL BY THE EUROPEAN UNION (WT/DS584/9)

•    The EU would like to support the proposal of establishing one single panel in the three cases filed by Japan, the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu and the EU as it already did a the last DSB meeting when a panel in the EU case (DS582) was established.  

•    All the three cases are “related to the same matter” under Article 9.1 of the DSU i.e. 1) they all identify India’s same tariff treatments of mostly identical ICT products, which are specified in the form of tariff lines in their respective panel requests; and 2) they all provide the same legal basis of complaints, i.e. a violation of tariff concessions that India has committed to within the legal framework of the WTO on this ICT products, under Article II of the GATT 1994.

•    The EU believes that the establishment of a single panel to examine the complaints in these three cases is feasible, as consultation meetings have already taken place in the three cases, and would in no way impair India’s rights under the DSU. Indeed, establishing a single panel would be desirable in these disputes as a way to organise the examination of this matter in an orderly and efficient manner, since this would save both time and human resources for India and each complainant. Such consideration is more pertinent today than ever under the current circumstances COVID-19 pandemic has brought upon us.

AGENDA POINT 5: INDIA – TARIFF TREATMENT ON CERTAIN GOODS IN THE INFORMATION AND COMMUNICATIONS TECHNOLOGY SECTOR    

A.    REQUEST FOR THE ESTABLISHMENT OF A PANEL BY THE SEPARATE CUSTOMS TERRITORY OF TAIWAN, PENGHU, KIMEN AND MATSU (WT/DS588/9)

⦁    The EU regrets that India does not accept the establishment of a single panel and would like to reiterate its support to the proposal of establishing one single panel in the three cases filed by Japan, the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu and the EU for the reasons mentioned under the previous point.  

AGENDA POINT 7: THE EUROPEAN UNION – CERTAIN MEASURES CONCERNING PAIL OIL AND OIL PALM CROP-BASED BIOFUELS

A.    REQUEST FOR THE ESTABLISHMENT OF A PANEL BY INDONESIA (WT/DS593/9)

⦁    The European Union regrets that Indonesia decided to request the establishment of a panel on certain measures imposed by the European Union and its Member States concerning palm oil and oil palm crop-based biofuels from Indonesia.

⦁    The EU respects the right of Indonesia to bring this matter to WTO dispute settlement but firmly believes that its measures are fully justified.

⦁    For these reasons, the European Union is confident that it will prevail in this dispute, and that its actions will be declared in line with WTO law.

⦁    The EU also stands ready to discuss with Indonesia reciprocal interim arrangements that would preserve the availability of appeal review in this and other disputes on the basis of Article 25 of the DSU, either through an arbitration agreement as set forth in Annex 1 of the Multi-party interim appeal arbitration arrangement (MPIA) or through such an agreement concluded on an ad hoc basis.

AGENDA POINT 8: EUROPEAN UNION – SAFEGUARD MEASURES ON CERTAIN STEEL PRODUCTS    

A.    REQUEST FOR THE ESTABLISHMENT OF A PANEL BY TURKEY (WT/DS595/3)

⦁    The European Union regrets that the consultations held with Turkey in April did not lead to the settlement of this dispute.

⦁    The European Union believes that its safeguard measures on steel are in compliance with WTO law.

⦁    For this reason, the European Union opposes the establishment of a panel in this dispute.

AGENDA POINT 12: THAILAND – CUSTOMS AND FISCAL MEASURES ON CIGARETTES FROM THE PHILIPPINES

1.1.    A.    STATEMENT BY THE CHAIRMAN ON CONSULTATIONS WITH THAILAND AND THE PHILIPPINES WITH REGARD TO THE RECOURSE TO ARTICLE 22.2 OF THE DSU (WT/DS371/32)

B.    STATEMENT BY THE PHILIPPINES

C.    STATEMENT BY THAILAND

⦁    This dispute illustrates the disruptive effects of the paralysis of the Appellate Body on the functioning of the WTO dispute settlement system and on the rights of the parties in disputes. Under the DSU, the Philippines is entitled to a binding resolution of the dispute and it is also entitled to ultimately suspend concessions or other obligations if the inconsistency persists. Thailand on the other hand is entitled, under the DSU, to an appeal review of the compliance panel report.

⦁    In these extraordinary circumstances, the EU calls on the parties concerned to seek an agreed solution that would preserve the above rights for both parties in a balanced manner. The EU would like to point out that the parties could decide to submit the suspended appeal for completion under an appeal arbitration procedure pursuant to Article 25 of the DSU. Such an appeal arbitration procedure could, for all practical purposes, replicate all substantive and procedural aspects of Appellate Review.

⦁    The EU trusts that the DSB Chair can assist the parties in reaching such a solution.


AGENDA POINT 14: APPELLATE BODY APPOINTMENTS

•    The European Union refers to its statements on this issue in previous meetings, starting in February 2017 and to its statement in the General Council meetings, including last time on 9 December 2019.

•    Since 11 December 2019, the WTO no longer guarantees access to a binding, 2 tier, independent and impartial resolution of trade disputes. This is in clear breach of the WTO Agreements.

•    As we have said so many times, WTO Members have a shared responsibility to resolve this issue as soon as possible and to fill the outstanding vacancies as required by Article 17.2 of the DSU.

•    We thank all Members that have co-sponsored the proposal to launch the appointment process. We invite all other Members to endorse this proposal.

⦁    The EU would like to reiterate that we should be having a forward looking discussion and not continuously re-litigate our differences as to the reading of the current rules. The draft decision presented by Ambassador Walker could have been the right basis for unblocking the appointments. It was however not accepted by the US who had not made any proposals or counterproposals. The EU stands ready to continue a forward-looking discussion.

•    On substance, we refer to our earlier interventions on the respective issues. Our views are well known, but we would be happy to explain our position again as appropriate.

⦁    Finally, the US referred to MPIA. It is not clear on what basis the United States affirms that [to be adapted as needed: the MPIA “incorporates and exacerbates” what it considers to be some of “the worst aspects of the Appellate Body’s practices”,] in particular at a time where not a single arbitration award has yet been issued under the MPIA.

⦁    the MPIA is a stopgap interim arrangement and surely not a means to reform the dispute settlement process. Pending a multilaterally agreed reform of the dispute settlement system, the participants in the MPIA devised an interim arrangement based on the core features of Appellate Review pursuant to Article 17 of the DSU

 

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