WTO dispute settlements Flashcards
DS75: taxes on alcohol beverages
The dispute primarily centred around the regulations and taxation policies applied to alcoholic beverages,
particularly in Korea. The EU and US raised concerns about certain aspects of Korea’s regulations, including the
classification of alcoholic beverages, customs duties, and distribution practices.
The EU and US alleged that Korea’s regulations discriminated against imported alcoholic beverages by imposing
higher taxes and more restrictive distribution rules compared to domestic products. They argued that these
measures violated Korea’s obligations under the General Agreement on Tariffs and Trade (GATT) and other WTO
agreements.
EC arguments:
- Korea is in breach of its obligations under GATT ART III.2 (national treatment on internal taxation and
regulation—products cannot be subject to internal taxes in excess)
- Liquor Tax Law and the Education tax are higher than those applied on soju
- It is only a way to protect domestic production
US arguments:
- Korean law differentiate among distilled spirit;
- Higher internal taxes to imported distilled spirits is done to afford protection to its domestic production of
soju.
Korean arguments: the products at issue are not in competition, so taxation cannot be considered discriminatory. However, Kore was incapable of furnishing enough information in its oral statement
The Panel found that Korea had effectively violated the ART 3.2 OF GATT 1994, bc imposed taxes in excess on imported products, to promote the sale of the internal products nationally produced.
FORM OF DISCRIMINATION AND PROTECTIONISM.
DS 238 Preserved Peaches
Argentina implemented definitive safeguard measures (like increase in tariff from 11.5% to 19.6%) on imports of
preserved peaches from Chile in response to concerns about a surge in imports that were allegedly causing serious
injury to the domestic peach industry in Argentina. Safeguard measures are temporary trade remedies allowed under
WTO rules to protect domestic industries from sudden and harmful increases in imports.
Chile requested the Panel to conclude and find that the safeguard measures and investigations of Argentina.
EU: supporting Chile and agreeing w/ the articles used by Chile to claim discriminatory assessment by Argentina; US: it sided w/ Argentina probably bc it was behaving in the same way against other countries, so it wanted its interests protected.
The safeguard measures breached ART XIX(1)(a) of GATT, ART 2.1, 4.2(a), 4.1(b) of the AGREEMENT ON SAFEGUARDS.
WHat is anti dumping?
if a company exports a product at a price lower than the price it normally charges on its own home market, that product is said to be DUMPING.
Anti-dumping measures are unilateral remedies that the government of the importing country may apply after a thorough investigation has determined that the product is, in fact, being dumped, and that sales of the dumped product are causing material injury to the domestic industry that produces a like product. Anti-dumping measures can be put on imports of specific products if the Commission’s anti-dumping investigation justifies it. There measures are usually in the form of an AD VALOREM duty. Other measures that can be applied include a fixed or specific amount of duty or, in some cases, a minimum import price.
ANTI-DUMPING AGREEMENT: ALL MEMBERS OF THE WTO ARE PART TO THIS AGREEMENT (ART VI OF THE GATT 1994 on fair competition).
This agreement ensures that all proceedings will be transparent and that all interest parties have a full and equal opportunity to defend their interest. The main objective is to prevent imports at artificially low prices from significantly harming local producers. These dumping practices distort competition by allowing foreign products to enter the market at unfairly low prices, which can lead to the exclusion of domestic producers and job losses.
Investigation may be conducted by countries with the goal of protecting domestic producers and industries, assessing whether or not it is better and useful applying anti-dumping measures.
WTO allows for anti-dumping and countervailing measures if:
1. A dumping is occurring;
2. The domestic industry is suffering.
DS 341 Mexico Vs. EU on Olive oil
The olive oil industry represents for both European Communities and Mexico an immense cultural and economic resource and as such, any trade measures imposed can significantly impact stakeholders on both sides of the disputes. In Mexico the olive oil industry contributes to rural development, job creation and economic diversification in region where cultivation occurs. On the other hand, EU is the world’s largest producer and exporter of olive oil. Both EU and Mexico suffer from different challenges that hinder this production, related to pests, diseases, competition from other producing countries, scarce availability of infrastructures, etc.
In 2000 it was implemented a cooperation agreement between Mexico and EU for their trade relations, where they decided to progressively reduce tariffs and eliminate trade barriers, facilitating smoother trade flows. Both parties, from that moment on, have benefited from increased market access and opportunities for investment and cooperation in these sectors.
DEFINITION OF COUNTERVAILING MEASURES: they are trade remedies employed by a country in response to unfair trade practices, particularly subsidies provided by foreign governments that harm domestic countries. Countervailing measures are tariffs or duties imposed in imported goods to neutralise the adverse effects of subsidies granted by
exporting countries, with the primary aim to restore fair competition in the domestic market by offsetting the advantage enjoyed by subsidized imports.
Then Mexico filed an application for countervailing measures, since, according to it, EC provided subsidies to olive oil producers, resulting in unfair competition in the Mexican Market. Mexico alleged that these subsidies led to significant increases in olive oil exports from the EC to Mexico, causing injury to the Mexican olive oil industry. The latter initiated a dispute settlement proceeding against the EC, arguing that the subsidies provided by the EC violated WTO agreements, particularly the agreement on subsidies and countervailing measures, by leading to a decline in Mexican production, sales and profitability.
The Panel at the end decided that Mexico acted inconsistently with the Agreement that Mexico and EC had on trade, so it was interpreted as being a way to protect national producers against international trade, in fact Mexico failed in providing the necessary non-confidential evidences to prove that EU effectively damaged its economy through unfair competition.
DS 291: EU measures on biotech products
2003 case—US requesting consultation with European Communities concerning certain measures taken by the EC and its MSs affecting imports of agricultural and food imports from the US. The US asserted that the moratorium applied by the EC since October 1998 on the approval of biotech products has restricted imports of agricultural and food products from the US.
Regarding member State-level measures, the United States asserted that a number of EC
member States maintain national marketing and import bans on biotech products even though those products have
already been approved by the EC for import and marketing in the EC.
According to the United States, the measures at issue appeared to be inconsistent with the EC’s obligations under:
* Articles 2, 5, 7 and 8, and Annexes B and C of the SPS Agreement;
* Articles I, III, X and XI of the GATT 1994;
* Article 4 of the Agriculture Agreement; and
* Articles 2 and 5 of the TBT Agreement.
The panel found that EC had effectively implemented an effective moratorium on biotech product approvals from 1999 to 2003, despite earlier denials. This moratorium led to undue delays, breaching obligations under specific clauses of the SPS agreement. The panel also identified inconsistencies in EC approval procedures for certain biotech products but found no violations in other provisions of the SPS agreement. EC MSs’ safeguard measures lacked sufficient scientific basis, contravening SPS Agreement obligations.
DS 404: United States antidumping duties on shrimps from Vietnam
The United States imposed antidumping duties on certain shrimp imports from Vietnam, alleging that these imports
were being sold in the US market at prices below their fair market value (i.e., dumped) and were causing injury to the
US domestic shrimp industry.
Vietnam, the exporting country, challenged the US antidumping measures at the WTO, arguing that these measures
violated WTO rules, particularly the Agreement on Implementation of Article VI of the General Agreement on Tariffs
and Trade 1994 (Antidumping Agreement).
A country has the right to impose anti-dumping duties on foreign products that enter its market at prices lower than
the normal value of the product on the foreign market. Zeroing is a calculation device used by the United States to
establish this anti-dumping duty. WTO rulings have confirmed that this method increases, often substantially, the
exporter’s margin of dumping and thus the amount of anti-dumping duty that the exporter has to pay.
Vietnam won,
The Panel found that the USDOC’s use of zeroing in the calculation of dumping margins was inconsistent with Art. 2.4: : A fair comparison shall be made between the export price and the normal value. This comparison shall be made at the same level of trade, normally at the ex-factory level, and in respect of sales made at as nearly as possible the same time.
DS-600 Palm oil based biofuels
Case concerning Malaysia filing a dispute against EU for certain measures taken by the European Union regarding palm oil and oil palm-crop based biofuels, that, according to Indonesia, unfairly discriminate Indonesian palm oil.
The EU implemented regulations that phase out the use of palm oil in biofuels by 2030 due to concerns over
deforestation and environmental impacts associated with palm oil production. Indonesia argues that these
measures violate WTO rules, particularly those related to non-discrimination and technical barriers to trade.
Indonesia contends that the EU’s actions are discriminatory because they specifically target palm oil, whereas other
vegetable oils used in biofuels are not subject to similar restrictions. Indonesia also argues that the EU’s
environmental justifications are pre-textual and that the measures constitute unjustified barriers to trade.
If I understood this correctly, the panel concluded that Malaysia failed to establish thgat the EU had breached ther obligations. The EU therefore won.
DS 392: China poultry meat: us measures
The dispute concerns measures taken by the United States affecting the import of poultry products from China, primarily Section 727 of the Omnibus Appropriations Act of 2009. China alleged that these measures violated Articles I:1 and XI:1 of the GATT 1994 and Article 4.2 of the Agriculture Agreement. While China did not initially consider the measures to be sanitary and phytosanitary (SPS) measures, it indicated that if they were found to be so, they would also violate US obligations under the SPS Agreement.
China requested consultations with the United States on April 17, 2009, and subsequently requested the establishment of a panel on June 23, 2009. The panel found that Section 727 constituted an SPS measure and was inconsistent with various provisions of the SPS Agreement, including Articles 5.1, 5.2, and 5.5. It also ruled that Section 727 violated Articles I:1 and XI:1 of the GATT 1994.
Despite finding violations, the panel did not recommend that the United States bring the measure into conformity because Section 727 had already expired. The Dispute Settlement Body (DSB) adopted the panel report on October 25, 2010.
DS 22 Brazzilian DESICCATED cocunut
It was found that desiccated coconut indirectly benefitted from the subsidy provided to coconut fruit, causing a material injury to the Brazilian industry. According to the rules of the GATT, Philippines declared that the countervailing duty imposed on coconut and coconut milk was inconsistent with Brazil’s obligations and was not justified, for this reason Brazil had to bring the measure into conformity. But the panel found that the provisions of the agreements relied on by the claimant were inapplicable to the dispute.
