Item 3. IMPLEMENTATION BY THE EUROPEAN COMMUNITIES OF THE RECOMMENDATIONS AND RULINGS OF THE DSB IN RELATION TO “EUROPEAN COMMUNITIES - REGIME FOR THE IMPORTATION, SALE AND DISTRIBUTION OF BANANAS” AND RELATED SUBSEQUENT WTO PROCEEDINGS
A. STATEMENTS BY HONDURAS, NICARAGUA AND PANAMA
- Since the EC implemented its new bananas regime on January 1, a number of Members – including the United States – have voiced serious concerns about the regime. However, the EC has not, as yet, addressed those concerns.
- Instead, the EC has taken the further step of “suspending” the request it had made for a waiver from GATT Article XIII -- even though the EC continues to keep in place a special, preferential tariff-rate quota which it allocates to some Members but not to others.
- We are disappointed by the EC’s response to the concerns raised and are continuing our discussions with interested Members about this matter.
- We reiterate this is a matter of great importance to many Members. It is imperative that the EC work with such interested Members to reach a mutually satisfactory resolution of the dispute as expeditiously as possible.
Item 4. UNITED STATES – CONTINUED DUMPING AND SUBSIDY OFFSET ACT OF 2000: IMPLEMENTATION OF THE RECOMMENDATIONS ADOPTED BY THE DSB
A. STATEMENTS BY CANADA, THE EUROPEAN COMMUNITIES AND JAPAN
- With respect to Members’ questions and comments about the U.S. implementation in these disputes, as the United States has already explained at the DSB meetings of February 17th and March 17th, 2006, the President signed the Deficit Reduction Act into law on February 8, 2006. That Act includes a provision repealing the Continued Dumping and Subsidy Offset Act of 2000.
- Thus, the United States has taken all actions necessary to implement the recommendations and rulings in these disputes.
- With respect to Members’ comments and request about possible status reports by the United States, as we already explained, the United States has taken all actions necessary to implement the recommendations and rulings in these disputes.
- We therefore fail to see what purpose would be served by the submission of status reports repeating the progress the United States made in the implementation of the DSB’s recommendations and rulings.
Item 5. UNITED STATES – COUNTERVAILING MEASURES CONCERNING CERTAIN PRODUCTS FROM THE EUROPEAN COMMUNITIES
A. STATEMENT BY THE EUROPEAN COMMUNITIES
- We will convey to our capital the EC’s comments and its questions about these DOC proceedings, including its questions from previous DSB meeting.
- Turning to the EC’s comments about U.S. status reports, as we have noted at previous meetings, Members will recall that we made a statement at the meeting of September 27, 2005, when the DSB adopted the report of the Article 21.5 panel in this dispute, and that we followed up on that statement with a report to the DSB on the status of our implementation on November 28.
- In connection with the EC’s request and the EC’s comments, Members will recall that the second sentence of Article 21.6 of the DSU provides that “the issue of implementation of the recommendations or rulings may be raised at the DSB by any Member at any time following their adoption.” As we have said at two previous DSB meetings and are pleased to repeat again today, we would be happy to discuss with the EC on a bilateral basis their views on this issue. This offer has been made twice before but has not been taken up by the EC.
Item 6. EUROPEAN COMMUNITIES AND CERTAIN MEMBER STATES – MEASURES AFFECTING TRADE IN LARGE CIVIL AIRCRAFT
A. REQUEST BY THE UNITED STATES FOR A DECISION OF THE DSB (WT/DS316/5)
- Mr. Chairman, this first subitem concerns the request by the United States for a decision of the DSB, which -- as you have just mentioned -- was circulated to Members in document WT/DS316/5.
- Our written request sets out the reasons why the United States is seeking this decision. Let me take a moment to summarize what we are asking the DSB to do, and why.
- By way of background, Members will recall that on July 20, 2005, the DSB established a panel to examine the U.S. claims regarding the subsidies that France, Germany, the United Kingdom, Spain, and the European Communities have provided and are continuing to provide to Airbus, the European manufacturer of large civil aircraft. That panel was composed on October 17, 2005.
- Shortly thereafter, on October 26, 2005, the EC filed a request for preliminary rulings that raised various procedural objections with respect to the U.S. panel request. In addition, certain member States committed additional new subsidies to Airbus.
- Although none of the objections in the EC’s preliminary ruling request had merit, the United States indicated its willingness to hold further consultations with the EC in order to address those concerns, and thereby to simplify matters for the panel. The United States also wished to consult on the new Airbus subsidies.
- Accordingly, the United States filed a further request for consultations regarding the EC and member State measures on January 31, 2006. The United States and the EC held those consultations on March 23, 2006.
- On April 10, the United States filed a further request for the establishment of a panel, following up on those consultations.
- In view of the relationship that I have just outlined between our 2005 panel request and the request filed this month, the United States considers that the efficient functioning of the dispute settlement system would be served if the matters contained in this month’s request were considered by the panel established last July.
- The United States therefore decided to ask the DSB to take a decision to that effect, the decision we are now discussing.
- As we noted in our request, the DSB has taken similar decisions in analogous situations. For example, Article 9.1 of the DSU also reflects a policy, in certain circumstances, of having a single panel consider multiple panel requests related to the same matter whenever it is feasible to do so. And, under Article 9.1, the DSB has in the past taken decisions to refer a subsequently submitted complaint to a previously established panel.
- While Article 9.1 obviously does not apply to the situation before us today, the United States believes that the DSB’s experience with that article provides useful guidance. We have drawn upon that experience in structuring our request for a DSB decision.
- We hope that the Members of the DSB will be able to agree to our request, and we thank Members in advance for their support.
- In this connection, we also recognize that the European Communities is facing similar procedural issues in its dispute regarding alleged U.S. subsidies for large civil aircraft, since the EC has established two separate panels relating to the same matter.
- The United States believes that the decision we are seeking today in DS316 would be an appropriate approach for addressing the procedural issues in DS317 as well, and we would be prepared to support such a request by the European Communities.
The United States thanks Brazil and Canada for their constructive interventions on this topic. We appreciate their willingness to engage with us on the issues presented by this request for a decision. We will refer to capital their comments and questions, and will be pleased to discuss these issues with them, and with any other Member, bilaterally or perhaps at a future DSB meeting.
Turning to the EC comments, it is remarkable that the EC would assert that merger at this point in the process is not possible.
The United States and the EC mutually agreed in February to pause their respective disputes precisely in order to allow time to work out the procedural issues that would arise from the existence of the first and second panel requests (some of which the Canadian representative noted in his intervention).
As a consequence, the existing panel has taken no steps other than to establish its working procedures. The panel has done nothing that would be affected by a modification of its terms of reference. It has not yet begun addressing any of the parties’ claims, and no written submissions have yet been filed, so merger is simply a matter of adjusting the panel’s terms of reference so that a single panel can address all of the U.S. claims.
As the U.S. request makes clear, the merger would as a substantive matter be quite straightforward. The DSB would take the decision we have requested, and that would be that.
The EC’s approach, by contrast, would raise substantial issues, such as whether the panelists in the two disputes should be the same, the possibility of two panels examining the same measures coming to divergent results (another issue the Canadian representative alluded to), issues in terms of compliance such as different reasonable periods of time and different recommendations and rulings, etc.
As the United States previously noted, the DSB has in the past referred a new panel request to an existing panel, pursuant to Article 9.1. The United States would refer the EC and other Members, for example, to the Indonesia Autos dispute, which also involved subsidies and claims of serious prejudice, and to which the EC was a complaining party. There the terms of reference of the panel were amended to merge with a panel that was established after the original panel had been composed.
In the interest of efficiency, this is the most logical approach.
We invite the EC to reflect on the views expressed today, and to reconsider its approach to this issue.
Item 6. EUROPEAN COMMUNITIES AND CERTAIN MEMBER STATES – MEASURES AFFECTING TRADE IN LARGE CIVIL AIRCRAFT
B. REQUEST BY THE UNITED STATES FOR THE ESTABLISHMENT OF A PANEL (WT/DS316/6)
- We are disappointed that the EC was unable to permit the DSB to take the decision we were seeking under the previous subitem. We do not propose to reiterate now our comments on the EC’s position.
- In any event, in light of the EC’s decision to block referral of the matter in the U.S. panel request to the existing panel in DS316, the United States is obliged to pursue establishment of a panel in the ordinary way.
- Under the previous subitem, we also discussed in brief the reasons why we have brought this matter to dispute settlement, and we do not propose to repeat those points here either.
- We request that the DSB establish a new panel with respect to the matter contained in the U.S. panel request, pursuant to DSU Articles 6 and 7. The United States further requests that the panel have the terms of reference provided for in DSU Article 7.1.
- We are, of course, disappointed by the EC’s decision not to permit the DSB to establish the panel today.
- We would like to comment on one statement made the EC during its intervention that is unusual for a statement objecting to establishment of a panel, namely the EC’s objection to the title of this dispute and its comments on who the proper responding parties are.
- The United States requested consultations, and the establishment of a Panel, with respect to the governments of Germany, France, Spain, and the United Kingdom, in addition to the EC. Therefore, all five of those WTO Members are properly respondents in this dispute. While it may be that the EC will be representing the interests of the member States in the dispute, that representation does not change the member States’ legal status as respondents.
Item 7. UNITED STATES – MEASURES AFFECTING TRADE IN LARGE CIVIL AIRCRAFT
A. INITIATION OF THE PROCEDURE FOR DEVELOPING INFORMATION CONCERNING SERIOUS PREJUDICE UNDER ANNEX V OF THE SCM AGREEMENT AND DESIGNATION OF MR. MATEO DIEGO-FERNÁNDEZ AS THE DSB REPRESENTATIVE REFERRED TO IN PARAGRAPH 4 OF THAT ANNEX FOR THE DEVELOPMENT OF EVIDENCE TO BE EXAMINED BY THE PANEL IN DS317 ESTABLISHED ON 17 FEBRUARY 2006 IN THE FORM OF WRITTEN RESPONSES BY THE UNITED STATES TO WRITTEN QUESTIONS FROM THE DSB REPRESENTATIVE TO THE UNITED STATES PURSUANT TO ANNEX V, PARAGRAPH 1 AND ANNEX V, PARAGRAPH 2 OF THE SCM AGREEMENT (WT/DS317/5)
- We are surprised that the EC is seeking a separate Annex V information-gathering process for the panel established on February 17th. The EC initially stated that it sought establishment of that panel to “resolve a number of procedural imbroglios that had arisen” with regards to the terms of reference and Annex V process for the panel established in this dispute on July 20, 2005.
- By seeking now to have a separate Annex V process for the February 17th panel, the EC would achieve the opposite. It would leave in place the July 20th panel and create an independent panel with a separate record, addressing claims that overlap in several areas. The “imbroglios” in the July 20th panel’s proceedings that the EC said it wanted to resolve would remain unresolved, and would be exacerbated by new uncertainties with regard to the relationship between the July 20th and February 17th panels.
- We also note that, as the title of this agenda item indicates, the EC is seeking to unilaterally determine the identity of the representative of the DSB under paragraph 4 of Annex V of the SCM Agreement, as well as the particular procedures for its proposed information-gathering process. Nothing in Annex V or the DSU gives the EC this authority.