United Nations (UN)

EU Statements at Regular Dispute Settlement Body (DSB) meeting, 27 September 2021

Geneva, 27/09/2021 - 00:00, UNIQUE ID: 210928_5
Local Statements

Statements delivered by Ioannis Zervas, Counsellor

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.190)

  •     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.155)

  • The United States frequently refers to products that have successfully passed EFSA’s risk assessment, but not yet received final approval through comitology. The EU would like to point out that there are administrative procedures between the publication of EFSA’s favourable opinion and the comitology vote that have to be respected. These include, among others, procedures related to transparency, such as a one-month public consultation. The EU fails to see how these procedures can be characterised as ‘undue delay’.
  •  The EU acts in line with its WTO obligations. We recall that the EU approval system is not covered by the DSB’s recommendations and rulings.

 

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

  • Despite long-standing reassurances of the US that the DSB’s recommendations and rulings are fully implemented by adopting the Deficit Reduction Act, disbursements under CDSOA have been made every year since then. Every disbursement that still takes place under this legal basis is clearly an act of non-compliance with DSB recommendations and rulings. For the item to be considered resolved and removed from the DSB's surveillance, the U.S. must fully stop transferring collected duties.
  • The EU maintains that such full compliance is needed, 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 obligation under Article 21.6 of the DSU to submit implementation reports in this dispute, as the issue remains unresolved. If the U.S. does not agree that the issue remains unresolved, nothing prevents it from seeking a multilateral determination through a compliance procedure.

 

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

A.    STATEMENT BY THE UNITED STATES

  • The EU welcomes the fact that parties have now reached an Understanding on a Cooperative Framework for Large Civil Aircraft that has allowed the parties to suspend their respective retaliation measures for five years.
  • We note that, in the Airbus case, the EU notified a new set of compliance measures to the DSB.
  • That new set of compliance measures was 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 2020 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. In order to have these legal errors corrected, the EU filed an appeal against the compliance panel’s report on 6 December 2019.
  •  Whether or not the matter is “resolved” in the sense of Article 21.6 is the very subject matter of this ongoing litigation. The defending party is not required to submit “status reports” to the DSB in these circumstances.
  •  This is what differentiates the situation in this case from the situation in the Byrd amendment case.  Unlike the EU position in Airbus, the US has not requested reverse compliance proceedings in the Byrd Amendment case, so the issue of compliance is not sub judice. As there are no compliance proceedings pending in the Byrd Amendment case, the EU approach is that under Article 21.6 DSU, the issue of implementation must remain on the DSB's agenda until the issue is resolved. In the Byrd Amendment case, the EU does not agree with the assertion that the United States has implemented the DSB recommendations and rulings. This means that the issue remains unresolved for the purposes of Article 21.6 DSU.
  • The EU hopes that the spirit underlying the Understanding on a Cooperative Framework for Large Civil Aircraft will allow the parties to resolve their disagreement also in relation to the provision of status reports to the DSB in the Airbus case.

 

AGENDA POINT 7: STATEMENT BY MOROCCO REGARDING THE PANEL REPORT IN THE DISPUTE: “MOROCCO – DEFINITIVE ANTI-DUMPING MEASURES ON SCHOOL EXERCISE BOOKS FROM TUNISIA” (DS578)

  • This is another dispute that illustrates the grave consequences of the blockage of Appellate Body appointments since 2017. That blockage frustrates the essential rights of Members that were agreed multilaterally in the Dispute Settlement Understanding
  •  Under the DSU, parties to a dispute have the right to appeal a panel report and to have their case heard by the Appellate Body.
  • At the same time, under the DSU, the complainant is entitled to the resolution of the dispute through adjudication.
  • In this case, Morocco has formally notified the Dispute Settlement Body of its decision to appeal.
  • Therefore, pursuant to Article 16.4 of the DSU, the panel report is not to be considered for adoption by the DSB until after completion of the appeal.
  • The fact that Morocco has not filed an appellant’s submission in accordance with  Rule 21 of the Working Procedures for Appellate Review is irrelevant in that respect. It would be for the Appellate Body, once the work on this appeal resumes, to decide on any procedural consequences related to the absence of filing of an appellant’s submission on the same day as the date of the filing of the Notice of Appeal.
  • And we would expect that, in the interest of fairness, the Appellate Body would, in these exceptional circumstances, modify the relevant time periods set out in the Working Procedures, as they apply to this dispute.
  • We wish to underscore that Article 16.4 of Dispute Settlement Understanding  is clear: “… the report by the panel shall not be considered for adoption by the DSB until after completion of the appeal”. While Article 17.5 of the DSU provides for certain timeframes for appellate proceedings, it attaches no procedural consequences to the fact that these timeframes are exceeded. Consequently, there is no basis in the DSU for the assertion that a panel report that is under appeal could be adopted by the DSB after the expiry of the 90-day period. This is all the more so in the exceptional circumstances where the Appellate Body is unable to function.
  • Indeed, the lack of at least three Appellate Body Members is not a legal bar to a Member exercising its right to an appeal, and this is the right of any WTO Member under the DSU.
  • At the same time, Members should be mindful that, in the current specific circumstances where the Appellate Body is not operational, the decision by a respondent to appeal a panel report may amount in effect to dispute resolution through adjudication being blocked, unless that respondent agrees to the appeal being adjudicated upon through appeal arbitration based on Article 25 of the DSU, consistently with the principles of the DSU.
  • This is precisely why the EU and other Members have put in place the Multi-party interim appeal arbitration arrangement, to allow the above-mentioned rights to be preserved in a balanced manner, despite the blockage of the Appellate Body appointments. In particular, the MPIA preserves the right to an appeal review of the panel report and the right to have the dispute resolved through adjudication. The standard default appeal arbitration procedures, as attached to the MPIA, can also be used on ad hoc basis by Members who themselves do not participate in the MPIA.
  • In the absence of a functioning Appellate Body, we invite Members engaged in appeals to resort to appeal arbitration procedures, such as those foreseen in the MPIA, that preserve the DSU rights for both parties in a balanced way.
  • In any case, the European Union supports consultations that would help find a way forward in a manner that would be balanced for both parties.

 

AGENDA POINT 8: STATEMENT BY CHINA REGARDING THE PANEL REPORT IN THE DISPUTE: "UNITED STATES - SAFEGUARD MEASURE ON IMPORTS OF CRYSTALLINE SILICON PHOTOVOLTAIC PRODUCTS (DS562)

  • This is yet another dispute that illustrates the grave consequences of the blockage of Appellate Body appointments since 2017. That blockage frustrates the essential rights of Members that were agreed multilaterally in the DSU.
  • In that regard we refer to the EU’s interventions under the previous agenda item as well as under item 7 of the DSB meeting on 28 September 2020, where we elaborated on these consequences and on the possibility of appeals being adjudicated upon through appeal arbitration based on Article 25 of the DSU, consistently with the principles of the DSU. We will not repeat these points under this agenda item.
  • The DSB therefore is not to adopt the panel report at this stage.
  • The EU intervened as third party in this case and looks forward to commenting further at the appellate stage when the proceedings resume. In the meantime, as it is uncertain when appellate proceedings will resume, the EU notes with interest certain aspects of the approach which this panel has taken to the interpretation and application of the WTO disciplines on multilateral safeguards in this case.
  • The present panel report would appear to be the first completely successful defence of a multilateral safeguard measure (subject to the pending appeal proceedings).
  • Hence, the EU considers that the report of this panel and its approach to the WTO rules on multilateral safeguards deserve close attention.

 

AGENDA POINT 9: APPELLAE BODY APPOINTMENTS

  • The European Union refers to its previous statements on this issue.
  • Since 11 December 2019, the WTO no longer guarantees access to a binding, two-tier, independent and impartial resolution of trade disputes.
  • A fully functioning WTO dispute settlement system is critical for a rules-based multilateral trading system.
  • This is why the most urgent area of WTO reform involves finding an agreed basis to restore such a system and proceeding to the appointment of the members of the Appellate Body. This task should be addressed as a priority.
  • As we have consistently noted, 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.
  • The EU agrees that a meaningful reform is needed in order to achieve this objective.
  • The EU therefore renews its call on all WTO Members to engage in a constructive discussion as soon as possible in order to restore a fully functioning WTO dispute settlement system.
  • We thank all Members that have co-sponsored the proposal to launch the appointment processes.

 

AGENDA POINT 10: THE TWENTIETH ANNIVERSARY OF THE ADVISORY CENTRE ON WTO  LAW (ACWL)

  • The European Union greatly appreciates the work of the Advisory Centre on WTO Law in contributing to the smooth and equitable operation of the WTO’s dispute settlement system and to the WTO more generally.
  • Equitable access to the WTO’s dispute settlement system and, for that purpose, access to high-quality legal advice and representation in such procedures benefits the entire WTO Membership. It is part of the underpinnings of the rules-based multilateral trading system that should benefit all WTO Members, large and small.
  • This is why the work of the ACWL is important. It provides developing countries, including least developed countries, with access to specialist legal capacity. And it plays an important role in capacity building on WTO law in developing-country governments.
  • We would therefore like to congratulate the ACWL on this 20th anniversary and to wish it every success in the years to come. We would also like to express our appreciation to the Members of the ACWL – among them several Member States of the EU – for their role in supporting the activities of the ACWL.

 

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