session 5 Flashcards
Concepts “like” products
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Concept of “directly competitive” products
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Concept of substitutable products
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De facto discrimination
De facto discrimination - is states not to be discriminated through the law or regulation but in the fact of these laws or regulations which produce discrimination. For example state adopt the law or regulation in which grants trade advantages to all countries in the law, so de jure there is no discrimination but after we analyze that countries which can really benefit from those advantages in the light of condition which have been impose through the law we realize that only very limited group of countries can benefit from that advantages. It will constitute the discrimination de facto because even the state did not frame this regulation in order to discriminate but de facto there will be discrimination. De facto discrimination is very complex to identify.
Border tax adjustments
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First sentence art III:2
- Internal tax or other charge
- “Like products” :
Working Report Body tax adjustment
* Properties, quality and the nature of product (physical characteristic of the product)
* End-uses
* Consumer taste and habits (is it interchangeable product, consist on how the consumer behave concerned some drink)
* Tarif classification (there are HS is they are on the same level) - Imports taxed “in excess of” like domestic products (even not the smallest difference of tax %) (Tarif classification)
Second sentence art III:2
- Internal tax or other charge
- “Directly competitive or substitutable” products
- Imports and directly competitive or substitutable domestic products not “similarly taxed” (contains a de minimis exception( (has to be more de minims ) will be resident on the base on case to the raveling market) ) and you need to prove that they are not similarly taxed.
- Dissimilar taxation is “applied so as to afford protection” (here you need to prove that protectionism was applied)
You need to prove that competitive relation is distorted between two products. Nullified. That you can conclude. Equality of competitive distortion.
Art. III:2 addresses internal taxation.
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Rule of national treatment
??? The national treatment obligation»_space;>relates to whether a country favours itself over other countries»_space;>prohibits a country to discriminate against other countries
Government Procurement
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Plausible public policy
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Asbestos
high toxical material
PCG fibers
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asbestos fibers
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Less favorable treatment
- Treatment no less favorable = effective equality of opportunities
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If the measures can be objectively determined with reference to a legitimate policy objective, such as environmental protection or public moral, it will not be de facto discriminatory with reference to origin.
Asbestos
Chrysotile asbestos is generally considered to be a highly toxic material, exposure to which poses significant threats to human health (such as asbestosis, lung cancer and mesothelioma)However, due to certain qualities (such as resistance to very high temperature), chrysotile asbestos has been widely used in various industrial sectors.
The most-fovared-nation clause
Article I
The national treatment clause
Article III
So national treatment covered by GATT Art III:2 and there are 3 requirements for there to be a violation
- There are must be an “internal tax” or “other internal charge” applied, directly or indirectly, to imported and domestic products
- The imported and domestic products must be “like”
- Imports must be taxed “in excess of” like domestic products.
DCS products
DCS products
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To demonstrate a violation of Article III:4 three conditions apply:
- The measure at issue must be a law, regulation or requirement “affecting the internal sale, offering for sale, purchase, transportation, distribution or use of products (on which more below in section D
- This measure accords treatment…less favorable
- Products from WTO member as compared to “like products” of national origin.
so as to afford protection
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measure can be held to be inconsistent with ArtIII:4
Thus, even if two products are “like” that does not mean that a measure is inconsistent with art III:4. A complaining member must still establish that the measure accords to the group of “like” imported products “less favorable treatment” than it accords to the group of “like” domestic products.
less favorable treatment
expresses the general principle, in Article III:1. That internal regulation “should not be applied …so as to afford protection to domestic production. Of there is “less favorable treatment” of the group of “like” imported products there is, conversely, protection” of the group of “like” domestic products.
De jure - discrimination
(the measure offers better treatment to domestic products as compared to like imports based on origin.
(Such as banning imported asbestos but permitting domestic asbestos on the basis of origin)
The harder cases are when the measure is on its face origin-neutral, but is argued to amount to a de facto discrimination against imports.
De facto - discrimination
against imports. In this case is the condition of less favorable treatment a matter of effects, such as demonstrating that fewer products in the import group meet the requirement or that the tax or burden actually imposed on the import group is high
Probably the most important decision of the appellate body on art III4 the AB overruled finding by the Panel that asbestos fibers and asbestos-fibre products were “like products : relative to PCG Fibers, in the light of a French ban against the former but not the latter. While the panel had upheld the measures under Art XX (b) the AB held the there was no violation in the first place of art III4. In the AB’s view, all four criteria that had been adopted in prior AB and Panel decisions, largely based on the criteria proposed in the GATT Working Party Report on Border Tax Adjustments in 1970, had to be examined in order to reach overall judgment on likeness. It held that the Panel had looked only at end-uses, and then only at a snack number of overlapping end-uses without examining non-overlapping end-uses. The AB continued to emphasize, as it had in the second Japanese - Alcohol case, the essentially economic test for likeness under art III, with its focus on competitive relationships, but was of the view that there was a very heavy burden of proof on a complainant to demonstrate likeness in context where there were sharp differences in physical characteristics, particularly physical characteristics that related to health effects.
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Detrimental effect
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Less favorable treatment is about affecting competitive opportunities to the detriment of imports; it does not require the showing of actual effects, nor does it allow for justification with reference to legitimate, non-protectionist aims or objectives.
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MRM exceptions
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European Communities — Asbestos
The Panel and the Appellate Body in this case both rejected Canada’s challenge to France import ban on asbestos and asbestos-containing products, reinforcing the view that the WTO Agreements support members’ ability to protect human health and safety at the level of protection they deem appropriate.
National Treatment
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dumping
Occurs when goods are exported at a price less than their normal value, generally meaning they are exported for less than they are sold in the domestic market or third-country markets, or at less than production cost.
DSU
Dispute Settlement Understanding, the WTO agreement that covers dispute settlement — in full, the Understanding on Rules and Procedures Governing the Settlement of Disputes.
DSB
Dispute Settlement Body — when the WTO General Council meets to settle trade disputes.
ad valorem equivalent (AVE)
A tariff that is not a percentage (eg, dollars per ton) can be estimated as a percentage of the price — the ad valorem equivalent.
ad valorem tariff
A tariff rate charged as percentage of the price.
anti-dumping duties
GATT’s Article 6 allows anti-dumping duties to be imposed on goods that are deemed to be dumped and causing injury to producers of competing products in the importing country. These duties are equal to the difference between the goods’ export price and their normal value, if dumping causes injury.
