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UNDERSTANDING ON RULES AND PROCEDURES
GOVERNING THE SETTLEMENT OF DISPUTES
1. Coverage and Application
1.1 The rules and procedures of this Understanding shall apply to disputes
brought pursuant to the consultation and dispute settlement rules and
procedures of the agreements listed in Appendix 1 to this Understanding,
hereinafter referred to as the "covered agreements." The rules and
procedures of this Understanding shall also apply to consultations and the
settlement of disputes between Members concerning their rights and
obligations under the provisions of the Agreement Establishing the
Multilateral Trade Organization (MTO) and of this Understanding taken in
isolation or in combination with any other covered agreement.
1.2 These rules and procedures shall apply subject to such special or
additional rules and procedures on dispute settlement contained in the
covered agreements as are identified in Appendix 2 to this Understanding.
To the extent that there is a difference between the rules and procedures of
this Understanding and the special or additional rules and procedures set
forth in Appendix 2, the special or additional rules and procedures in
Appendix 2 shall prevail. In disputes involving rules and procedures under
more than one covered Agreement, if there is a conflict between special or
additional rules and procedures of such Agreements under review, and where
the parties to the dispute cannot agree on rules and procedures within
twenty days of the establishment of the panel, the Chairman of the Dispute
Settlement Body, in consultation with the parties to the dispute, shall
determine the rules and procedures to be followed within ten days after a
request by either Member. The Chairman of the Dispute Settlement Body shall
be guided by the principle that special or additional rules and procedures
should be used where possible, and the rules and procedures set out in this
Understanding should be used to the extent necessary to avoid conflict.
2. Administration
2.1 The Dispute Settlement Body (DSB) established pursuant to the
Agreement Establishing the MTO shall administer these rules and procedures
and, except as otherwise provided in a covered agreement, the consultation
and dispute settlement provisions of the covered agreements. Accordingly,
the DSB shall have the authority to establish panels, adopt panel and
Appellate Body reports, maintain surveillance of implementation of rulings
and recommendations, and authorize suspension of concessions and other
obligations under the covered agreements. With respect to disputes arising
under covered agreements contained in Annex 4 to the MTO Agreement, the term
"Member" as used herein shall refer only to those Members that are parties
to the relevant Annex 4 Agreements. Where the DSB administers the dispute
settlement provisions of a covered agreement contained in Annex 4, only
those Members that are parties to that agreement may participate in
decisions or actions taken by the DSB with respect to that dispute.
2.2 The DSB shall inform the relevant MTO councils and committees of any
developments in disputes related to provisions of the respective covered
agreements.
2.3 The DSB shall meet as often as necessary to carry out its functions
within the time-frames provided in this Understanding.
2.4 Where the rules and procedures of this Understanding provide for the
DSB to take a decision, it shall do so by consensus[1].
3. General Provisions
3.1 The members of the MTO (hereinafter referred to as "Members") affirm
their adherence to the principles for the management of disputes heretofore
applied under Articles XXII and XXIII of the GATT 1947, as further
elaborated and modified herein.
3.2 The dispute settlement system of the MTO is a central element in
providing security and predictability to the multilateral trading system.
The Members of the MTO recognize that it serves to preserve the rights and
obligations of Members under the covered agreements, and to clarify the
existing provisions of those agreements in accordance with customary rules
of interpretation of public international law. Recommendations and rulings
of the DSB cannot add to or diminish the rights and obligations provided in
the covered agreements.
3.3 The prompt settlement of situations in which a Member considers that
any benefits accruing to it directly or indirectly under the covered
agreements are being impaired by measures taken by another Member is
essential to the effective functioning of the MTO and the maintenance of a
proper balance between the rights and obligations of Members.
3.4 Recommendations or rulings made by the DSB shall be aimed at achieving
a satisfactory settlement of the matter in accordance with the rights and
obligations under this Understanding and under the covered agreements.
3.5 All solutions to matters formally raised under the consultation and
dispute settlement rules and procedures of the covered agreements, including
arbitration awards, shall be consistent with those agreements and shall not
nullify or impair benefits accruing to any Member under those agreements,
nor impede the attainment of any objective of those agreements.
3.6 Mutually agreed solutions to matters formally raised under the
consultation and dispute settlement provisions of the covered agreements
shall be notified to the DSB and the relevant councils and committees, where
any Member may raise any point relating thereto.
3.7 Before bringing a case, a Member shall exercise its judgement as to
whether action under these procedures would be fruitful. The aim of the
dispute settlement mechanism is to secure a positive solution to a dispute.
A solution mutually acceptable to the parties to a dispute and consistent
with the covered agreements is clearly to be preferred. In the absence of a
mutually agreed solution, the first objective of the dispute settlement
mechanism is usually to secure the withdrawal of the measures concerned if
these are found to be inconsistent with the provisions of any of the covered
agreements. The provision of compensation should be resorted to only if the
immediate withdrawal of the measure is impracticable and as a temporary
measure pending the withdrawal of the measure which is inconsistent with a
covered agreement. The last resort which this Understanding provides to the
Member invoking the dispute settlement procedures is the possibility of
suspending the application of concessions or other obligations under the
covered agreements on a discriminatory basis vis-à-vis the other Member,
subject to authorization by the DSB of such measures.
3.8 In cases where there is an infringement of the obligations assumed
under a covered agreement, the action is considered prima facie to
constitute a case of nullification or impairment. This means that there is
normally a presumption that a breach of the rules has an adverse impact on
other Members parties to that covered agreement, and in such cases, it shall
be up to the Member against whom the complaint has been brought to rebut the
charge.
3.9 The provisions of this Understanding are without prejudice to the
rights of Members to seek authoritative interpretation of provisions of a
covered agreement through decision making under the Agreement Establishing
the MTO or a covered agreement.
3.10 It is understood that requests for conciliation and the use of the
dispute settlement procedures should not be intended or considered as
contentious acts and that, if disputes arise, all Members will engage in
these procedures in good faith in an effort to resolve the disputes. It is
also understood that complaints and counter-complaints in regard to distinct
matters should not be linked.
3.11 This Understanding shall be applied only with respect to new requests
for consultations under the consultation provisions of the covered
agreements made on or after the date of entry into force of this
Understanding. With respect to disputes for which the request for
consultations was made under the GATT 1947 or under any other predecessor
agreement to the covered agreements before the date of entry into force of
this Understanding, the relevant dispute settlement rules and procedures in
effect immediately prior to the date of entry into force of this
Understanding shall continue to apply.[2]
3.12 Notwithstanding paragraph 3.11 above, if a complaint based on any of
the Agreements covered by this Understanding is brought by a developing
country Member against a developed country Member, the complaining party
shall have the rights to invoke, as an alternative to the provisions
contained in paragraphs 4, 5, 6 and 12 of this Understanding, the
corresponding provisions of the Decision of CONTRACTING PARTIES of 5 April
1966 (BISD 14S/18), except that where the Panel considers that the time
frame provided for in paragraph 7 of that decision is insufficient to
provide its report and with the agreement of the complaining party, that
time frame may be extended. To the extent that there is a difference
between the rules and procedures of those paragraphs and the corresponding
rules and procedures of the Decision, the latter shall prevail.
4. Consultations
4.1 The Members affirm their resolve to strengthen and improve the
effectiveness of the consultation procedures employed by Members.
4.2 Each Member undertakes to accord sympathetic consideration to and
afford adequate opportunity for consultation regarding any representations
made by another Member concerning measures affecting the operation of the
covered agreements taken within the territory of the former.[3]
4.3 If a request for consultations is made pursuant to a covered
agreement, the Member to which the request is made shall, unless otherwise
mutually agreed, reply to the request within ten days after its receipt and
shall enter into consultations in good faith within a period of no more than
thirty days from the date of the request, with a view to reaching a mutually
satisfactory solution. If the Member does not respond within ten days, or
does not enter into consultations within a period of no more than thirty
days, or a period otherwise mutually agreed, from the date of the request,
then the Member that requested the holding of consultations may proceed
directly to request the establishment of a panel.
4.4 All such requests for consultations shall be notified to the DSB and
the relevant Councils and Committees by the Member which requests
consultations. Any request for consultations shall be submitted in writing
and shall give the reasons for the request, including identification of the
measures at issue and an indication of the legal basis for the complaint.
4.5 In the course of consultations in accordance with the provisions of a
covered agreement, before resorting to further action under this
Understanding, Members should attempt to obtain satisfactory adjustment of
the matter.
4.6 Consultations shall be confidential, and without prejudice to the
rights of either Member in any further proceedings.
4.7 If the consultations fail to settle a dispute within sixty days after
the request for consultations, the complaining party may request the
establishment of a panel. The complaining party may request a panel during
the sixty-day period if the consulting parties jointly consider that
consultations have failed to settle the dispute.
4.8 In cases of urgency, including those which concern perishable goods,
Members shall enter into consultations within a period of no more than ten
days from the date of the request. If the consultations have failed to
settle the dispute within a period of twenty days after the request, the
complaining party may request the establishment of a panel.
4.9 In cases of urgency, including those which concern perishable goods,
the parties to the dispute, panels and the appellate body shall make every
effort to accelerate the proceedings to the greatest extent possible.
4.10 During consultations Members should give special attention to the
particular problems and interests of developing country Members.
4.11 Whenever a Member other than the consulting Members considers that it
has a substantial trade interest in consultations being held pursuant to
Article XXII:1 of the GATT, Article XXII:1 of the GATS Agreement or the
corresponding provisions in other covered agreements,[4] such Member may
notify the consulting Members and the DSB, within ten days of the
circulation of the request for consultations under said Article, of its
desire to be joined in the consultations. Such Member shall be joined in
the consultations, provided that the Member to which the request for
consultations was addressed agrees that the claim of substantial interest is
well-founded. In that event they shall so inform the DSB. If the request
to be joined in the consultations is not accepted, the applicant Member
shall be free to request consultations under Article XXII:1 or XXIII:1 of
the GATT, Article XXII:1 or XXIII:1 of the GATS Agreement or the
corresponding provisions in other covered agreements.
5. Good Offices, Conciliation and Mediation
5.1 Good offices, conciliation and mediation are procedures that are
undertaken voluntarily if the parties to the dispute so agree.
5.2 Proceedings involving good offices, conciliation and mediation, and in
particular positions taken by the parties to the dispute during these
proceedings, shall be confidential, and without prejudice to the rights of
either party in any further proceedings under these procedures.
5.3 Good offices, conciliation and mediation may be requested at any time
by any party to a dispute. They may begin at any time and be terminated at
any time. Once terminated, the complaining party can then proceed with a
request for the establishment of a panel.
5.4 When good offices, conciliation or mediation are entered into within
sixty days of a request for consultations, the complaining party must allow
a period of sixty days from the date of the request for consultations before
requesting the establishment of a panel. The complaining party may request a
panel during the sixty days if the parties to the dispute jointly consider
that the good offices, conciliation or mediation process has failed to
settle the dispute.
5.5 If the parties to a dispute agree, procedures for good offices,
conciliation or mediation may continue while the panel process proceeds.
5.6 The Director-General may, acting in an ex officio capacity, offer good
offices, conciliation or mediation with the view to assisting Members to
settle a dispute.
6. Establishment of Panels
6.1 If the complaining party so requests, a panel shall be established at
the latest at the DSB meeting following that at which the request first
appears as an item on the DSB's agenda, unless at that meeting the DSB
decides by consensus not to establish a panel.[5]
6.2 The request for the establishment of a panel shall be made in writing.
It shall indicate whether consultations were held, identify the specific
measures at issue and provide a brief summary of the legal basis of the
complaint sufficient to present the problem clearly. In case the applicant
requests the establishment of a panel with other than standard terms of
reference, the written request shall include the proposed text of special
terms of reference.
7. Terms of Reference of Panels
7.1 Panels shall have the following terms of reference unless the parties
to the dispute agree otherwise within twenty days from the establishment of
the panel:
"To examine, in the light of the relevant provisions in (name of the
covered agreement/s cited by the parties to the dispute), the matter
referred to the DSB by (name of party) in document DS/... and to make such
findings as will assist the DSB in making the recommendations or in giving
the rulings provided for in that/those agreement/s."
7.2 Panels shall address the relevant provisions in any covered
agreement/s cited by the parties to the dispute.
7.3 In establishing a panel, the DSB may authorize its Chairman to draw up
the terms of reference of the panel in consultation with the parties to the
dispute subject to the provisions of paragraph 7.1 above. The terms of
reference thus drawn up shall be circulated to all Members. If other than
standard terms of reference are agreed upon, any Member may raise any point
relating thereto in the DSB.
8. Composition of Panels
8.1 Panels shall be composed of well-qualified governmental and/or
non-governmental individuals, including persons who have served on or
presented a case to a panel, served as a representative of an MTO Member or
of a contracting party to the GATT 1947 or as a representative to a council
or committee of any covered agreement or its predecessor agreement, or in
the Secretariat, taught or published on international trade law or policy,
or served as a senior trade policy official of a Member.
8.2 Panel members should be selected with a view to ensuring the
independence of the members, a sufficiently diverse background and a wide
spectrum of experience.
8.3 Citizens of Members whose governments[6] are parties to the dispute
or third parties as defined in paragraph 10.2 shall not serve on a panel
concerned with that dispute, unless the parties to the dispute agree
otherwise.
8.4 To assist in the selection of panelists, the Secretariat shall
maintain an indicative list of governmental and non-governmental individuals
possessing the qualifications outlined in paragraph 1 above, from which
panelists may be drawn as appropriate. That list shall include the roster
of non-governmental panelists that was established by the GATT CONTRACTING
PARTIES on 30 November 1984 (BISD 31S/9), and other rosters and indicative
lists established under any of the covered agreements, and shall retain the
names of persons on those rosters and indicative lists at the time of entry
into force of this Understanding. Members may periodically suggest names of
governmental and non-governmental individuals for inclusion on the
indicative list, providing relevant information on their knowledge of
international trade and of the sectors or subject matter of the covered
agreements, and those names shall be added to the list upon approval by the
DSB. For each of the individuals on the list, the list shall indicate
specific areas of experience or expertise of the individuals in the sectors
or subject matter of the covered agreements.
8.5 Panels shall be composed of three panelists unless the parties to the
dispute agree, within ten days from the establishment of the panel, to a
panel composed of five panelists. Members shall be informed promptly of the
composition of the Panel.
8.6 The Secretariat shall propose nominations for the panel to the parties
to the dispute. The parties to the dispute shall not oppose nominations
except for compelling reasons.
8.7 If there is no agreement on the panelists within twenty days from the
establishment of a panel, at the request of either party, the
Director-General in consultation with the Chairman of the DSB, and the
Chairman of the relevant committee or council, shall form the panel by
appointing the panelists whom he or she considers most appropriate in
accordance with any relevant special or additional procedure of the covered
agreement, after consulting with the parties to the dispute. The Chairman
of the DSB shall inform the Members of the composition of the panel thus
formed no later than ten days from the date he or she receives such a
request.
8.8 Members shall undertake, as a general rule, to permit their officials
to serve as panelists.
8.9 Panelists shall serve in their individual capacities and not as
government representatives, nor as representatives of any organization.
Governments shall therefore not give them instructions nor seek to influence
them as individuals with regard to matters before a panel.
8.10 When a dispute is between a developing country Member and a developed
country Member the panel shall, if the developing country Member so
requests, include at least one panelist from a developing country Member.
8.11 Panelists' expenses, including travel and subsistence allowance,
shall be met from the MTO budget in accordance with criteria to be adopted
by the General Council of the MTO, based on recommendations of the Committee
on Budget, Finance and Administration.
9. Procedures for Multiple Complainants
9.1 Where more than one Member requests the establishment of a panel
related to the same matter, a single panel may be established to examine
these complaints taking into account the rights of all Members concerned. A
single panel should be established to examine such complaints whenever
feasible.
9.2 The single panel will organize its examination and present its
findings to the DSB so that the rights which the parties to the dispute
would have enjoyed had separate panels examined the complaints are in no way
impaired. If one of the parties to the dispute so requests, the panel will
submit separate reports on the dispute concerned. The written submissions by
each of the complainants will be made available to the other complainants,
and each complainant will have the right to be present when one of the other
complainants presents its view to the panel.
9.3 If more than one panel is established to examine the complaints
related to the same matter, to the greatest extent possible the same persons
shall serve as panelists on each of the separate panels and the timetable
for the panel process in such disputes shall be harmonized.
10. Third Parties
10.1 The interests of the parties to a dispute and those of other
Members[7] of a covered agreement at issue in the dispute shall be fully
taken into account during the panel process.
10.2 Any Member, of a covered agreement at issue in a dispute, having a
substantial interest in a matter before a panel and having notified its
interest to the DSB, (hereinafter referred to as a "third party") shall have
an opportunity to be heard by the panel and to make written submissions to
the panel. These submissions shall also be given to the parties to the
dispute and shall be reflected in the panel report.
10.3 Such third parties shall receive submissions of the parties to the
dispute for the first meeting of the panel.
10.4 If a third party considers a measure already the subject of a panel
proceeding nullifies or impairs benefits accruing to it under any covered
agreement, that Member may have recourse to normal dispute settlement
procedures under this Understanding. Such a dispute shall be referred to the
original panel wherever possible.
11. Function of Panels
11.1 The function of panels is to assist the DSB in discharging its
responsibilities under this Understanding and the covered agreements.
Accordingly, a panel should make an objective assessment of the matter
before it, including an objective assessment of the facts of the case and
the applicability of and conformity with the relevant covered agreements,
and make such other findings as will assist the DSB in making the
recommendations or in giving the rulings provided for in the covered
agreements. Panels should consult regularly with the parties to the dispute
and give them adequate opportunity to develop a mutually satisfactory
solution.
12. Panel Procedures
12.1 Panels shall follow the Working Procedures appended hereto unless the
panel decides otherwise after consulting the parties to the dispute.
12.2 Panel procedures should provide sufficient flexibility so as to ensure
high-quality panel reports, while not unduly delaying the panel process.
12.3 After consulting the parties to the dispute, the panelists shall, as
soon as practicable and whenever possible within one week after the
composition and terms of reference of the panel have been agreed upon, fix
the timetable for the panel process, taking into account the provisions of
paragraph 4.9, if relevant.
12.4 In determining the timetable for the panel process, the panel shall
provide sufficient time for the parties to the dispute to prepare their
submissions.
12.5 Panels should set precise deadlines for written submissions by the
parties and the parties should respect those deadlines.
12.6 Each party to the dispute shall deposit its written submissions with
the Secretariat for immediate transmission to the panel and to the other
party or parties to the dispute. The complaining party shall submit its
first submission in advance of the responding party's first submission
unless the panel decides, in fixing the timetable referred to in paragraph
12.3 above and after consultations with the parties to the dispute, that the
parties should submit their first submissions simultaneously. When there
are sequential arrangements for the deposit of first submissions, the panel
shall establish a firm time period for receipt of the responding party's
submission. Any subsequent written submissions shall be submitted
simultaneously.
12.7 Where the parties to the dispute have failed to develop a mutually
satisfactory solution, the panel shall submit its findings in a written
form. In such cases, the report of a panel shall set out the findings of
fact, the applicability of relevant provisions and the basic rationale
behind any findings and recommendations that it makes. Where a settlement of
the matter among the parties to the dispute has been found, the report of
the panel shall be confined to a brief description of the case and to
reporting that a solution has been reached.
12.8 In order to make the procedures more efficient, the period in which
the panel shall conduct its examination, from the time the composition and
terms of reference of the panel have been agreed upon to the time when the
final report is provided to the parties to the dispute, shall, as a general
rule, not exceed six months. In cases of urgency, including those relating
to perishable goods, the panel shall aim to provide its report to the
parties to the dispute within three months.
12.9 When the panel considers that it cannot provide its report within six
months, or within three months in cases of urgency, it shall inform the DSB
in writing of the reasons for the delay together with an estimate of the
period within which it will submit its report. In no case should the period
from the establishment of the panel to the submission of the report to the
Members exceed nine months.
12.10 In the context of consultations involving a measure taken by a
developing country Member, the parties may agree to extend the periods
established in paragraphs 4.7 and 4.8. If, after the relevant period has
elapsed, the consulting parties cannot agree that the consultations have
concluded, the Chairman of the DSB shall decide, after consultation with the
parties, whether to extend the relevant period and, if so, for how long. In
addition, in examining a complaint against a developing country Member, the
panel shall accord sufficient time for the developing country Member to
prepare and present its argumentation. The provisions of paragraphs 20.1 and
21.4 are not affected by any action pursuant to this paragraph.
12.11 Where one or more of the parties is a developing country Member, the
panel's report shall explicitly indicate the form in which account has been
taken of relevant provisions on differential and more-favourable treatment
for developing country Members that form part of the covered agreements
which have been raised by the developing country Member in the course of the
dispute settlement procedures.
12.12 The panel may suspend its work at any time at the request of the
complaining party for a period not to exceed twelve months. In the event of
such a suspension, the time frames set out in paragraphs 12.8, 12.9, 20.1
and 21.4 shall be extended by the amount of time that the work was
suspended. If the work of the panel has been suspended for more than twelve
months, the authority for establishment of the panel shall lapse.
13. Right to Seek Information
13.1 Each panel shall have the right to seek information and technical
advice from any individual or body which it deems appropriate. However,
before a panel seeks such information or advice from any individual or body
within the jurisdiction of a Member it shall inform the authorities of that
Member. A Member should respond promptly and fully to any request by a
panel for such information as the panel considers necessary and appropriate.
Confidential information which is provided shall not be revealed without
formal authorization from the individual, body, or authorities of the
Member providing the information.
13.2 Panels may seek information from any relevant source and may consult
experts to obtain their opinion on certain aspects of the matter. With
respect to a factual issue concerning a scientific or other technical matter
raised by a party to a dispute, a panel may request an advisory report in
writing from an expert review group. Rules for the establishment of such a
group and its procedures are set forth in Appendix 4.
14. Confidentiality
14.1 Panel deliberations shall be confidential.
14.2 The reports of panels shall be drafted without the presence of the
parties to the dispute in the light of the information provided and the
statements made.
14.3 Opinions expressed in the panel report by individual panelists shall
be anonymous.
15. Interim Review Stage
15.1 Following the consideration of rebuttal submissions and oral
arguments, the panel shall submit the descriptive (factual and argument)
sections of its draft report to the parties. Within a period of time set by
the panel, the parties shall submit their comments in writing.
15.2 Following the deadline for receipt of comments from the parties, the
panel shall issue an interim report to the parties, including both the
descriptive sections and the panel's findings and conclusions. Within a
period of time set by the panel, a party may submit a written request for
the panel to review precise aspects of the interim report prior to
circulation of the final report to the Members. At the request of a party,
the panel shall hold a further meeting with the parties on the issues
identified in the written comments. If no comments are received from any
party within the comment period, the interim report shall be considered the
final panel report and circulated promptly to the Members.
15.3 The findings of the final panel report shall include a discussion of
the arguments made at the interim review stage. The interim review stage
shall be conducted within the time period set out in paragraph 12.8.
16. Adoption of Panel Reports
16.1 In order to provide sufficient time for the Members of the DSB to
consider panel reports, the reports shall not be considered for adoption by
the DSB until twenty days after they have been issued to the Members.
16.2 Members having objections to panel reports shall give written reasons
to explain their objections for circulation at least ten days prior to the
DSB meeting at which the panel report will be considered.
16.3 The parties to a dispute shall have the right to participate fully in
the consideration of the panel report by the DSB, and their views shall be
fully recorded.
16.4 Within sixty days of the issuance of a panel report to the Members,
the report shall be adopted at a DSB meeting[8] unless one of the parties to
the dispute formally notifies the DSB of its decision to appeal or the DSB
decides by consensus not to adopt the report. If a party has notified its
intention to appeal, the report by the panel shall not be considered for
adoption by the DSB until after completion of the appeal. This adoption
procedure is without prejudice to the right of Members to express their
views on a panel report.
17. Appellate Review
Standing Appellate Body
17.1 A standing Appellate Body shall be established by the DSB. The
Appellate Body shall hear appeals from panel cases. It shall be composed of
seven persons, three of whom shall serve on any one case. Persons serving
on of the Appellate Body shall serve in rotation. Such rotation shall be
determined in the working procedures of the Appellate Body.
17.2 The DSB shall appoint persons to serve on the Appellate Body for a
four-year term, and each person may be reappointed once. However, the terms
of three of the seven persons appointed immediately after the entry into
force of this Understanding shall expire at the end of two years, to be
determined by lot. Vacancies shall be filled as they arise. A person
appointed to replace a person whose term of office has not expired shall
hold office for the remainder of his or her predecessor's term.
17.3 The Appellate Body shall be comprised of persons of recognized
authority, with demonstrated expertise in law, international trade and the
subject matter of the covered agreements generally. They shall be
unaffiliated with any government. The Appellate Body membership shall be
broadly representative of membership in the MTO. All persons serving on the
Appellate Body shall be available at all times and on short notice, and
shall stay abreast of dispute settlement activities and other relevant
activities of the MTO. They shall not participate in the consideration of
any disputes that would create a direct or indirect conflict of interest.
17.4 Only parties to the dispute, not third parties, may appeal a panel
decision. Third parties which have notified the DSB of a substantial
interest in the matter pursuant to paragraph 10.2 may make written
submissions to, and be given an opportunity to be heard by, the Appellate
Body.
17.5 As a general rule, the proceedings shall not exceed sixty days from
the date a party to the dispute formally notifies its intent to appeal to
the date the Appellate Body issues its decision. In fixing its timetable
the Appellate Body shall take into account the provisions of paragraph 4.9,
if relevant. When the Appellate Body considers that it cannot provide its
report within sixty days, it shall inform the DSB in writing of the reasons
for the delay together with an estimate of the period within which it will
submit its report. In no case shall the proceedings exceed ninety days.
17.6 An appeal shall be limited to issues of law covered in the panel
report and legal interpretation developed by the panel.
17.7 The Appellate Body shall be provided with appropriate administrative
and legal support as it requires.
17.8 The expenses of persons serving on the Appellate Body, including
travel and subsistence allowance, shall be met from the MTO budget in
accordance with criteria to be adopted by the General Council of the MTO,
based on recommendations of the Committee on Budget, Finance and
Administration.
Procedures for Appellate Review
17.9 Working procedures shall be drawn up by the Appellate Body in
consultation with the Chairman of the DSB and the Director-General, and
communicated to the Members for their information.
17.10 The proceedings of the Appellate Body shall be confidential. The
reports of the Appellate Body shall be drafted without the presence of the
parties to the dispute and in the light of the information provided and the
statements made.
17.11 Opinions expressed in the Appellate Body report by individuals
serving on the Appellate Body shall be anonymous.
17.12 The Appellate Body shall address each of the issues raised in
accordance with paragraph 17.6 during the appellate proceeding.
17.13 The Appellate Body may uphold, modify or reverse the legal findings
and conclusions of the panel.
Adoption of Appellate Reports
17.14 An appellate report shall be adopted by the DSB and unconditionally
accepted by the parties to the dispute unless the DSB decides by consensus
not to adopt the appellate report within thirty days following its issuance
to the Members.[9] This adoption procedure is without prejudice to the right
of Members to express their views on an appellate report.
18. Communications with the panel or Appellate Body
18.1 There shall be no ex parte communications with the panel or Appellate
Body concerning matters under consideration by the panel or Appellate Body.
18.2 Written submissions to the panel or the Appellate Body shall be
treated as confidential, but shall be made available to the parties to the
dispute. Nothing in this Understanding shall preclude a party to a dispute
from disclosing statement of its own positions to the public. Members shall
treat as confidential, information submitted by another Member to the panel
or the Appellate Body which that Member has designated as confidential. A
party to a dispute shall also, upon request of a Member, provide a
non-confidential summary of the information contained in its written
submissions that could be disclosed to the public.
19. Panel and Appellate Body Recommendations
19.1 Where a panel or the Appellate Body concludes that a measure is
inconsistent with a covered agreement, it shall recommend that the Member
concerned[10] bring the measure into conformity with that Agreement. [11] In
addition to its recommendations, the panel or Appellate Body may suggest
ways in which the Member concerned could implement the recommendations.
19.2 In accordance with paragraph 3.2 above, in their findings and
recommendations, the panel and Appellate Body cannot add to or diminish the
rights and obligations provided in the covered agreements.
20. Time-Frame for DSB Decisions
20.1 Unless otherwise agreed to by the parties to the dispute, the period
from the establishment of the Panel by the DSB until the DSB considers the
panel or appellate report for adoption shall not as a general rule exceed
nine months where the report is not appealed or twelve months where the
report is appealed. Where either the panel or the Appellate Body has acted,
pursuant to paragraph 12.9 or 17.5, to extend the time of providing its
report, the additional time taken shall be added to the above periods.
21. Surveillance of Implementation of Recommendations and Rulings
21.1 Prompt compliance with recommendations or rulings of the DSB is
essential in order to ensure effective resolution of disputes to the benefit
of all Members.
21.2 Particular attention should be paid to matters affecting the interests
of developing country Members with respect to measures which have been
subject to dispute settlement.
21.3 At a DSB meeting held within thirty days[12] of the adoption of the
panel or Appellate Body report, the Member concerned shall inform the DSB of
its intentions in respect of implementation of the recommendations and
rulings of the DSB. If it is impracticable to comply immediately with the
recommendations and rulings, the Member concerned shall have a reasonable
period of time in which to do so. The reasonable period of time shall be:
(a) the period of time proposed by the Member concerned, provided
that such period is approved by the DSB; or, in the absence of
such approval,
(b) a period of time mutually agreed by the parties to the dispute
within forty-five days following adoption of the recommendations
and rulings; or, in the absence of such agreement,
(c) a period of time determined through binding arbitration within
ninety days following adoption of the recommendations and
rulings. [13] In such arbitration, a guideline for the
arbitrator[14] should be that the reasonable period of time to
implement panel or Appellate Body recommendations should not
exceed fifteen months from the adoption of a panel or Appellate
Body report. However, that time may be shorter or longer,
depending upon the particular circumstances.
21.4 Except where the panel or the Appellate Body has extended, pursuant to
paragraph 12.9 or 17.5, the time of providing its report, the period from
the date of establishment of the panel by the DSB until the determination of
the reasonable period of time shall not exceed fifteen months unless the
parties to the dispute agree otherwise. Where either the panel or the
Appellate Body has acted to extend the time of providing its report, the
additional time taken shall be added to the fifteen-month period; provided
that unless the parties to the dispute agree that there are exceptional
circumstances, the total time shall not exceed eighteen months.
21.5 Where there is disagreement as to the existence or consistency with a
covered agreement of measures taken to comply with the recommendations and
rulings such dispute shall be decided through recourse to these dispute
settlement procedures, involving resort to the original panel wherever
possible. The panel shall issue its decision within ninety days of referral
of the matter to it. When the panel considers that it cannot provide its
report within this time frame, it shall inform the DSB in writing of the
reasons for the delay together with an estimate of the period within which
it will submit its report.
21.6 The DSB shall keep under surveillance the implementation of adopted
recommendations or rulings. The issue of implementation of the
recommendations or rulings may be raised at the DSB by any Member at any
time following their adoption. Unless the DSB decides otherwise, the issue
of implementation of the recommendations or rulings shall be on the agenda
of the DSB meeting after six months following the establishment of the
reasonable period of time pursuant to paragraph 21.3 and shall remain on the
DSB's agenda until the issue is resolved. At least ten days prior to each
such DSB meeting, the Member concerned shall provide the DSB with a status
report in writing of its progress in the implementation of the
recommendations or rulings.
21.7 If the matter is one which has been raised by a developing country
Member the DSB shall consider what further action it might take which would
be appropriate to the circumstances.
21.8 If the case is one brought by a developing country Member, in
considering what appropriate action might be taken, the DSB shall take into
account not only the trade coverage of measures complained of, but also
their impact on the economy of developing country Members concerned.
22. Compensation and the Suspension of Concessions
22.1 Compensation and the suspension of concessions or other obligations
are temporary measures available in the event that the recommendations and
rulings are not implemented within a reasonable period of time. However,
neither compensation nor the suspension of concessions or other obligations
is preferred to full implementation of a recommendation to bring a measure
into conformity with the covered agreements. Compensation is voluntary and,
if granted, shall be consistent with the covered agreements.
22.2 If the Member concerned fails to bring the measure found to be
inconsistent with a covered agreement into compliance therewith or otherwise
comply with the recommendations and rulings within the reasonable period of
time determined pursuant to paragraph 21.3 above, such Member shall, if so
requested, and no later than the expiry of the reasonable period of time,
enter into negotiations with any party having invoked the dispute settlement
procedures, with a view to developing mutually acceptable compensation. If
no satisfactory compensation has been agreed within twenty days after the
expiry of the reasonable period of time, any party having invoked the
dispute settlement procedures may request authorization from the DSB to
suspend the application to the Member concerned of concessions or other
obligations under the covered agreements.
22.3 In considering what concessions or other obligations to suspend, the
complaining party shall apply the following principles and procedures:
(a) The general principle is that the complaining party should first
seek to suspend concessions or other obligations with respect to
the same sector(s) as that in which the panel or Appellate Body
has found a violation or other nullification or impairment.
(b) If that party considers that it is not practicable or effective
to suspend concessions or other obligations with respect to the
same sectors, it may seek to suspend concessions or other
obligations in other sectors under the same agreement.
(c) If that party considers that it is not practicable or effective
to suspend concessions or other obligations with respect to
other sectors under the same agreement, and that the
circumstances are serious enough, it may seek to suspend
concessions or other obligations under another covered agreement.
(d) In applying the above principles, that party shall take into
account:
(i) the trade in the sector or under the agreement under which
the panel or Appellate Body has found a violation or other
nullification or impairment, and the importance of such
trade to that party;
(ii) the broader economic elements related to the nullification
or impairment and the broader economic consequences of the
suspension of concessions or other obligations.
(e) If that party decides to request authorization to suspend
concessions or other obligations pursuant to (b) or (c) above, it
shall state the reasons therefor in its request. At the same
time as the request is forwarded to the DSB, it also shall be
forwarded to the relevant Councils and also, in the case of a
request pursuant to (b), the relevant sectoral bodies.
(f) For purposes of this paragraph, "sector" means:
- With respect to goods, all goods;
- With respect to services, a principal sector as identified
in the current "Services Sectoral Classification List"
which identifies such sectors;[15]
- With respect to trade-related intellectual property rights,
each of the categories of intellectual property rights
covered in Section 1, or Section 2, or Section 3, or
Section 4, or Section 5, or Section 6, or Section 7 of
Part II, or the obligations under Part III, or Part IV of
the Agreement on Trade-Related Aspects of Intellectual
Property Rights, including Trade in Counterfeit Goods
("Agreement on TRIPS").
(g) For purposes of this paragraph, "agreement" means:
- With respect to goods, the agreements listed in Annex 1A of
the MTO Agreement, taken as a whole as well as the
agreements listed in Annex 4 of the MTO Agreement in so far
as the relevant parties to the dispute are parties to these
agreements;
- With respect to services, the GATS;
- With respect to intellectual property rights, the Agreement
on TRIPS.
22.4 The level of the suspension of concessions or other obligations
authorized by the DSB shall be equivalent to the level of the nullification
or impairment.
22.5 The Dispute Settlement Body shall not authorize suspension of
concessions or other obligations if a covered agreement prohibits such
suspension.
22.6 When the situation described in paragraph 22.2 above occurs, the DSB,
upon request, shall grant authorization to suspend concessions or other
obligations within thirty days of the expiry of the reasonable period of
time unless the DSB decides by consensus to reject the request. However, if
the Member concerned objects to the level of suspension proposed, or claims
that the principles and procedures set forth in paragraph 22.3 above have
not been followed where a complaining party has requested authorization to
suspend concessions or other obligations pursuant to paragraph 22.3(b) or
(c) above, the matter shall be referred to arbitration. Such arbitration
shall be carried out by the original panel, if members are available, or by
an arbitrator[16] appointed by the Director-General and shall be completed
within sixty days of the expiry of the reasonable period of time.
Concessions or other obligations shall not be suspended during the course of
the arbitration.
22.7 The arbitrator[17] acting pursuant to paragraph 22.6 above shall not
examine the nature of the concessions or other obligations to be suspended
but shall determine whether the level of such suspension is equivalent to
the level of nullification or impairment. The arbitrator may also determine
if the proposed suspension of concessions or other obligations is allowed
under the covered agreement.* However, if the matter referred to
arbitration includes a claim that the principles and procedures set forth in
paragraph 22.3 above have not been followed, the arbitrator shall examine
that claim. In the event the arbitrator determines that those principles
and procedures have not been followed, the complaining party shall apply
them consistent with paragraph 22.3 above. The parties shall accept the
arbitrator's decision as final and the parties concerned shall not seek a
second arbitration. The DSB shall be informed promptly of the decision of
the arbitrator and shall upon request, grant authorization to suspend
concessions or other obligations where the request is consistent with the
decision of the arbitrator, unless the DSB decides by consensus to reject
the request.
22.8 The suspension of concessions or other obligations shall be temporary
and shall only be applied until such time as the measure found to be
inconsistent with a covered agreement has been removed, or the Member that
must implement recommendations or rulings provides a solution to the
nullification or impairment of benefits, or a mutually satisfactory solution
is reached. In accordance with paragraph 21.6 above, the DSB shall continue
to keep under surveillance the implementation of adopted recommendations or
rulings, including those cases where compensation has been provided or
concessions or other obligations have been suspended but the recommendations
to bring a measure into conformity with the covered agreements have not been
implemented.
22.9 The dispute settlement provisions of the covered agreements may be
invoked in respect of measures affecting their observance taken by regional
or local governments or authorities within the territory of a Member. When
the DSB has ruled that a provision of a covered agreement has not been
observed, the responsible Member shall take such reasonable measures as may
be available to it to ensure its observance. The provisions of the covered
agreements and this Understanding relating to compensation and suspension of
concessions or other obligations apply in cases where it has not been
possible to secure such observance.[18]
23. Strengthening of the Multilateral System
23.1 When Members seek the redress of a violation of obligations or other
nullification or impairment of benefits under the covered agreements or an
impediment to the attainment of any objective of the covered agreements,
they shall have recourse to, and abide by, the rules and procedures of this
Understanding.
23.2 In such cases, Members shall:
(a) not make a determination to the effect that a violation has
occurred, that benefits have been nullified or impaired or that
the attainment of any objective of the covered agreements has
been impeded, except through recourse to dispute settlement in
accordance with the rules and procedures of this Understanding,
and shall make any such determination consistent with the
findings contained in the panel or Appellate Body report adopted
by the DSB or an arbitration award rendered under this
Understanding;
(b) follow the procedures set forth in Section 21 of this
Understanding to determine the reasonable period of time for the
Member concerned to implement the recommendations and rulings;
and
(c) follow the procedures set forth in Section 22 of the
Understanding to determine the level of suspension of concessions
or other obligations and obtain DSB authorization in accordance
with those procedures before suspending concessions or other
obligations under the covered agreements in response to the
failure of the Member concerned to implement the recommendations
and rulings within that reasonable period of time.
24. Special Procedures involving Least-Developed Country Members
24.1 At all stages of the determination of the causes of a dispute and of
dispute settlement procedures involving a least-developed country Member,
particular consideration shall be given to the special situation of
least-developed country Members. In this regard, Members shall exercise due
restraint in raising matters under these procedures involving a least
developed country Member. If nullification or impairment is found to result
from a measure taken by a least developed country Member, complaining
parties shall exercise due restraint in asking for compensation or seeking
authorization to suspend the application of concessions or other obligations
pursuant to these procedures.
24.2 In dispute settlement cases involving a least-developed country Member
where a satisfactory solution has not been found in the course of
consultations the Director-General or the Chairman of the DSB shall, upon
request by a least-developed country Member offer their good offices,
conciliation and mediation with a view to assisting the parties to settle
the dispute, before a request for a panel is made. The Director-General or
the Chairman of the DSB, in providing the above assistance, may consult any
source which they deem appropriate.
25. Arbitration
25.1 Expeditious arbitration within the MTO as an alternative means of
dispute settlement can facilitate the solution of certain disputes that
concern issues that are clearly defined by both parties.
25.2 Except as otherwise provided in this Understanding, resort to
arbitration shall be subject to mutual agreement of the parties which shall
agree on the procedures to be followed. Agreements to resort to arbitration
shall be notified to all Members sufficiently in advance of the actual
commencement of the arbitration process.
25.3 Other Members may become party to an arbitration proceeding only upon
the agreement of the parties which have agreed to have recourse to
arbitration. The parties to the proceeding shall agree to abide by the
arbitration award. Arbitration awards shall be notified to the DSB and the
council or committee of any relevant agreement where any Member may raise
any point relating thereto.
25.4 Sections 21 and 22 of this Understanding shall apply mutatis mutandis
to arbitration awards.
26. Non-Violation
26.1 Complaints of the Type Described in Article XXIII:1(b) of GATT 1994
Where the provisions of Article XXIII:1(b) of the GATT 1994 are
applicable to a covered agreement, a panel or the Appellate Body may only
make rulings and recommendations where a party
to the dispute considers that any benefit accruing to it directly or
indirectly under the relevant covered agreement is being nullified or
impaired or the attainment of any objective of that Agreement is being
impeded as a result of the application by a Member of any measure, whether
or not it conflicts with the provisions of that Agreement. Where and to the
extent that such party considers and a panel or the Appellate Body
determines that a case concerns a measure that does not conflict with the
provisions of a covered agreement to which the provisions of Article
XXIII:1(b) of GATT 1994 are applicable, the procedures in this Understanding
shall apply, subject to the following:
(a) The complaining party shall present a detailed justification in
support of any complaint relating to a measure which does not
conflict with the relevant covered agreement.
(b) Where a measure has been found to nullify or impair benefits
under, or impede the attainment of objectives, of the relevant
covered agreement without violation thereof, there is no
obligation to withdraw the measure. However, in such cases, the
panel or the Appellate Body shall recommend that the Member
concerned make a mutually satisfactory adjustment.
(c) Notwithstanding the provisions of paragraph 21, the arbitration
provided for in paragraph 21.3, upon request of either party, may
include a determination of the level of benefits which have been
nullified or impaired, and may also suggest ways and means of
reaching a mutually satisfactory adjustment; such suggestions
shall not be binding upon the parties.
(d) Notwithstanding the provisions of paragraph 22.1, compensation
may be part of a mutually satisfactory adjustment as final
settlement of the dispute.
26.2 Complaints of the Type Described in Article XXIII:1(c) of GATT 1994
Where the provisions of Article XXIII:1(c) of the GATT 1994 are
applicable to a covered agreement, a panel may only make rulings and
recommendations where a party considers that any benefit accruing to it
directly or indirectly under the relevant covered agreement is being
nullified or impaired or the attainment of any objective of that Agreement
is being impeded as a result of the existence of any situation other than
those to which the provisions of Article XXIII:1(a) and (b) of GATT 1994 are
applicable. Where and to the extent that such party considers and a panel
determines that the matter is covered by this paragraph, the procedures of
this Understanding shall apply only up to and including the point in the
proceedings where the panel report has been issued to the Members. The
dispute settlement rules and procedures contained in the Decision of the
GATT Council of Representatives of 12 April 1989 (BISD 36S/61) shall apply
to consideration for adoption, and surveillance and implemation of
recommendations and rulings. The following shall also apply:
(a) The complaining party shall present a detailed justification in
support of any argument made with respect to issues covered under
this paragraph.
(b) In cases involving matters covered by this paragraph, if a panel
finds that cases also involve dispute settlement matters other
than those covered by this paragraph, the panel shall issue a
report addressing any such matters and a separate report on
matters falling under this paragraph.
27. Responsibilities of the Secretariat
27.1 The MTO Secretariat shall have the responsibility of assisting the
panels, especially on the legal, historical and procedural aspects of the
matters dealt with, and of providing secretarial and technical support.
27.2 While the Secretariat assists Members in respect of dispute settlement
at their request, there may also be a need to provide additional legal
advice and assistance in respect of dispute settlement to developing
country Members. To this end, the Secretariat shall make available a
qualified legal expert from the MTO technical co-operation services to any
developing country Member which so requests. This expert shall assist the
developing country Member in a manner ensuring the continued impartiality of
the Secretariat.
27.3 The Secretariat shall conduct special training courses for interested
Members concerning these dispute settlement procedures and practices so as
to enable Members' experts to be better informed in this regard.
APPENDIX 1
AGREEMENTS COVERED BY THE UNDERSTANDING
A) Agreement Establishing the Multilateral Trade Organization
B) Annex 1A: Agreements on trade in goods
Annex 1B: General Agreement on Trade in Services
Annex 1C: Agreement on Trade-Related Aspects of Intellectual Property
Rights, including Trade in Counterfeit Goods
Annex 2: Understanding on Rules and Procedures Governing the
Settlement of Disputes
C) Annex 4: Agreement on Trade in Civil Aircraft
Agreement on Government Procurement
International Dairy Arrangement
Arrangement Regarding Bovine Meat
The applicability of this Understanding to Annex 4 Agreements shall be
subject to the adoption of a decision by the Signatories of each Agreement
setting out the terms for the application of the Understanding to the
individual agreement, including any special or additional rules or
procedures for inclusion in Appendix 2, as notified to the Dispute
Settlement Body.
APPENDIX 2
SPECIAL OR ADDITIONAL RULES AND PROCEDURES
CONTAINED IN THE COVERED AGREEMENTS
Agreement Rules and Procedures
Anti-Dumping 17.4 to 17.7
Technical Barriers to Trade 14.2 to 14.4, Annex 2
Subsidies and Countervailing Measures 4.2 to 4.12, 6.6, 7.2 to 7.10, 8.5,
footnote 33, 25.3 to 25.4, 28.6,
Annex V
Customs Valuation 19.3 to 19.5, Annex II.2(f), 3, 9, 21
Sanitary and Phytosanitary Regulations 36
Textiles 2.14, 2.21, 4.4, 5.2, 5.4, 5.6, 6.9,
6.10, 6.11, 8.1 to 8.12
General Agreement on Trade in Services XXII:3, XXIII:3
Financial Services 4.1
Air Transport Services 4
Minsterial Decision on Services Disputes1 to 5
The list of rules and procedures in this Appendix includes provisions where
only a part of the provision may be relevant in this context.
Any special or additional rules or procedures in ANNEX 4 Agreements as
determined by the competent bodies of each Agreement and as notified to the
DSB.
APPENDIX 3
WORKING PROCEDURES
l. In its proceedings the panel will follow the relevant provisions of the
Understanding on Rules and Procedures Governing the Settlement of Disputes.
In addition, the following working procedures will apply.
2. The panel will meet in closed session. The parties to the dispute, or
other interested parties, will be present at the meetings only when invited
by the panel to appear before it.
3. The deliberations of the panel and the documents submitted to it will
be kept confidential. Nothing in this Understanding shall preclude a party
to a dispute from disclosing statements of its own positions to the public.
Members shall treat as confidential, information submitted by another Member
to the panel which that Member has designated as confidential. Where a
party to a dispute submits a confidential version of its written submissions
to the panel, it shall also, upon request of a Member, provide a
non-confidential summary of the information contained in its submissions
that could be disclosed to the public.
4. Before the first substantive meeting of the panel with the parties,
both parties to the dispute shall transmit to the panel written submissions
in which they present the facts of the case and their arguments.
5. At its first substantive meeting with the parties, the panel will ask
the party which has brought the complaint to present its case.
Subsequently, and still at the same meeting, the party against which the
complaint has been brought will be asked to present its point of view.
6. All third parties which have notified their interest in the dispute to
the DSB shall be invited in writing to present their views during a session
of the first substantive meeting of the panel set aside for that purpose.
All such third parties may be present during the entirety of this session.
7. Formal rebuttals will be made at a second substantive meeting of the
panel. The party complained against will have the right to take the floor
first to be followed by the complaining party. Both parties shall submit,
prior to that meeting, written rebuttals to the panel.
8. The panel may at any time put questions to the parties and ask them for
explanations either in the course of a meeting with the parties or in
writing.
9. The parties to the dispute and any third party invited to present its
views in accordance with Section 8 of the Understanding shall make available
to the panel a written version of their oral statements.
10. In the interest of full transparency, the presentations, rebuttals and
statements referred to in paragraphs 5 to 9 above will be made in the
presence of both parties. Moreover, each party's written submissions,
including any comments on the descriptive part of the report and responses
to questions put by the panel, will be made available to the other party.
11. Any additional procedures specific to the panel.
12. The panel proposes the following timetable for its work:
(a) Receipt of first written
submissions of the Parties:
(l) complaining Party:_______ 3-6 weeks
(2) Party complained
against:_______ 2-3 weeks
(b) Date, time and place of
first substantive meeting
with the Parties; Third
Party session:_______ 1-2 weeks
(c) Receipt of written rebuttals
of the Parties:_______ 2-3 weeks
(d) Date, time and place of
second substantive meeting
with the Parties:_______ 1-2 weeks
(e) Submission of descriptive
part of the report to the
Parties: _______ 2-4 weeks
(f) Receipt of comments by the
Parties on the descriptive
part of the report:_______ 2 weeks
(g) Submission of the interim
report, including the find-
ings and conclusions, to
the Parties: _______ 2-4 weeks
(h) Deadline for Party to request
review of part(s) of report:_______ 1 week
(i) Period of review by panel,
including possible additional
meeting with Parties:_______ 2 weeks
(j) Submission of final report
to Parties to dispute:_______ 2 weeks
(k) Circulation of the final report
to the Members:_______ 3 weeks
The above calendar may be changed in the light of unforeseen
developments. Additional meetings with the Parties will be scheduled if
required.
APPENDIX 4
EXPERT REVIEW GROUPS
The following rules and procedures shall apply to expert review groups
established in accordance with the provisions of Article 13.2.
1. Expert review groups are under the panel's authority. Their terms of
reference and detailed working procedures shall be decided by the panel, and
they shall report to the panel.
2. Participation in expert review groups shall be restricted to persons of
professional standing and experience in the field in question.
3. Citizens of parties to the dispute shall not serve on an expert review
group without the joint agreement of the parties to the dispute, except in
exceptional circumstances when the panel considers that the need for
specialized scientific expertise cannot be fulfilled otherwise. Government
officials of parties to the dispute shall not serve on an expert review
group. Members of expert review groups shall serve in their individual
capacities and not as government representatives, nor as representatives of
any organization. Governments or organizations shall therefore not give
them instructions with regard to matters before an expert review group.
4. Expert review groups may consult and seek information and technical
advice from any source they deem appropriate. Before an expert review group
seeks such information or advice from a source within the jurisdiction of a
Member, it shall inform the government of that Member. Any Member shall
respond promptly and fully to any request by an expert review group for such
information as the expert review group considers necessary and appropriate.
5. The parties to a dispute shall have access to all relevant information
provided to an expert review group, unless it is of a confidential nature.
Confidential information provided to the expert review group shall not be
released without formal authorization from the government, organization or
person providing the information. Where such information is requested from
the expert review group but release of such information by the expert review
group is not authorized, a non-confidential summary of the information will
be provided by the government, organization or person supplying the
information.
6. The expert review group shall submit a draft report to the parties to
the dispute with a view to obtaining their comments, and taking them into
account, as appropriate, in the final report, which shall also be circulated
to the parties to the dispute when it is submitted to the panel. The final
report of the expert review group shall be advisory only.
1. The Dispute Settlement Body shall be deemed to have decided by consensus
on a matter submitted for its consideration, if no Member, present at the
meeting of the Dispute Settlement Body when the decision is taken, formally
objects to the proposed decision.
2. This paragraph shall also be applied to disputes on which panel reports
have not been adopted or fully implemented.
3. Where the provisions of any other covered agreement concerning measures
taken by regional or local governments or authorities within the territory
of a Member contain provisions different from the provisions of this
paragraph, the provisions of such other covered agreement shall prevail.
4. The corresponding consultations provisions in the covered agreements are
listed hereunder: Agreement on Rules of Origin, Article 7; Agreement on
Preshipment Inspection, Article 7; Agreement on Implementation of Article
VI of the GATT, Article 18.6; Agreement on Technical Barriers to Trade,
Article 14.1; Agreement on Import Licensing Procedures, Article 6;
Agreement on Subsidies and Countervailing Measures, Articles 13 and 30;
Agreement on Agriculture, Article 18.1, and Part C, Agreement on Sanitary
and Phytosanitary Measures, paragraph 35; Trade-Related Aspects of
Investment Measures, Article 8; Agreement on Textiles and Clothing Article
8.4; Agreement on Trade-Related Aspects of Intellectual Property Rights,
including Trade in Counterfeit Goods, Article 64; Agreement on Trade in
Civil Aircraft Article 8.8; Agreement on Government Procurement, Article
VII:3; International Diary Arrangement, Article VIII:7; Arrangement
Regarding Bovine Meat, Article VI:6.
5. If the complaining party so requests, a meeting of the Dispute Settlement
Body shall be convened for this purpose within fifteen days of the request,
provided that at least ten days' advance notice of the meeting is given.
6. In the case where customs unions or common markets are parties to a
dispute, this provision applies to citizens of all member countries of the
customs unions or common markets.
7. With respect to disputes arising under covered agreements contained in
Annex 4 to the MTO Agreement, the term "Member" as used herein shall refer
only to those Members that are parties to the relevant Annex 4 Agreements.
Where the DSB administers the dispute settlement provisions of a covered
agreement contained in Annex 4, only those Members that are parties to that
agreement may participate in decisions or actions taken by the DSB with
respect to that dispute.
8. If a meeting of the DSB is not scheduled within this period at a time
that enables the requirements of paragraphs 16.1 and 16.4 to be met, a
meeting of the DSB shall be held for this purpose.
9. If a meeting of the DSB is not scheduled during this period, such a
meeting of the DSB shall be held for this purpose.
10. The "Member concerned" is the party to the dispute to which the panel or
Appellate Body recommendations are directed.
11. With respect to recommendations in cases not involving a violation of
the GATT and any other covered agreement, see section 26.
12. If a meeting of the DSB in not scheduled during this period, such a
meeting of the DSB shall be held for this purpose.
13. If the parties cannot agree on an arbitrator within ten days after
referring the matter to arbitration, the arbitrator shall be appointed by
the Director-General within ten days, after consulting the parties.
14. The expression "arbitrator" shall be interpreted as referring either to
an individual or a group.
15. The list in document MTN.GNS/W/120 identifies eleven sectors.
16. The expression"arbitrator" shall be interpreted as referring either to
an individual or a group.
17. The expression "arbitrator" shall be interpreted as referring either to
an individual or a group or to the members of the original panel when
serving in the capacity of arbitrator.
18. Where the provisions of any covered agreement concerning measures taken
by regional or local governments or authorities within the territory of a
Member contain provisions different from the provisions of this paragraph,
the provisions of such covered agreement shall prevail.