Abstract
This paper provides an introduction to the panel process within the framework of the World Trade Organization (“WTO”) dispute settlement mechanism. After this brief introduction (I), it discusses (II) the types of complaints (that is, “violation” complaints, “non-violation” complaints and “situation” complaints); (III) who may participate in panel proceedings (including whether private counsel and non-governmental organizations may participate and whether there is a need for a “legal interest” in initiating proceedings); (IV) the object of a complaint; (V) the consultations stage; (VI) panel establishment and terms of reference; (VII) multiple panel proceedings; (VIII) panel composition; (IX) procedural stages of panel proceedings (including organizational meeting, preliminary issues and procedural objections, written submissions and oral hearings, confidentiality of proceedings); (X) third party rights; (XI) burden of proof (including timing of evidence); (XII) panel’s right to seek information (including expert review groups and duty to respond); (XIII) mandate of panels in respect of legal issues and factual issues; (XIV) interim review stage; (XV) contents of the final panel report (including the obligation to set out the basic rationale behind panel findings, duly exercise judicial economy, not to add to or diminish rights and obligations of Members, and the right to suggest how to implement the panel findings); and (XVI) conclusion of panel proceedings.1
Counsellor, WTO Appellate Body Secretariat (since 2001) and Legal Affairs Division (1995–2001). The views expressed in this article are personal to the author and should not be attributed to the Appellate Body Secretariat or the Appellate Body Members. The author would like to thank Valerie Hughes, Jim Bacchus, Tania Voon and Gabrielle Marceau for their comments on earlier drafts.
The appellate review and the implementation stages are covered by Chapters 27 and 28 of this book.
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References
Article 3.3 of the DSU and Article XXIII:1 of GATT: “If any Member should consider that any benefit accruing to it directly or indirectly under this Agreement is being nullified or impaired or that the attainment of any objective of the Agreement is being impeded...”. (See Panel Reports, EC—Bananas III, and Appellate Body Report, EC—Bananas III, ¶¶ 132 ff)
Done at Vienna, May 23, 1969, 1155 U.N.T.S. 331 (1969); 8 International Legal Materials 679 (1969).
Appellate Body Report, U.S.—Gasoline, at 17.
Article XXIII:1(b) of the GATT 1994 and Article 26 of the DSU. E.-U. Petersmann, Violation Complaints and Non-Violation Complaints in Public International Trade Law, 34 German Yearbook of International Law 175, 225 (1991), mentions as other legal bases for the non-violation concept the effectiveness of concessions, reciprocity and bona fide protection of reasonable expectations. Non-violation complaints are discussed in Chapter 29 of this book.
GATT Panel Report, EEC—Oilseeds I, adopted 25 January 1990, BISD 37S/86, at 128-129, ¶¶ 144 and 148, quoted in Appellate Body Report, EC—Asbestos, ¶ 185. The panel in Japan—Film noted that “[a]lthough the non-violation remedy is an important and accepted tool of WTO/GATT dispute settlement and has been ‘on the books’ for almost 50 years, we note that there have only been eight cases in which panels or working parties have substantively considered Article XXIII:1(b) claims. This suggests that both the GATT contracting parties and WTO Members have approached this remedy with caution and, indeed, have treated it as an exceptional instrument of dispute settlement.” (Panel Report, Japan—Film, ¶ 10.36)
The Appellate Body agreed, at ¶ 186 in EC—Asbestos, with the panel in Japan—Film. That panel stated that “[t]he reason for this caution is straightforward. Members negotiate the rules that they agree to follow and only exceptionally would expect to be challenged for actions not in contravention of those rules.” (Panel Report, Japan—Film, ¶ 10.36 (original emphasis))
Panel Report, Japan—Film, ¶¶ 10.41 ff.
Article XXIII:1(c) has been invoked in only very few instances under GATT 1947. While the establishment of a panel or a working party under this article has been requested in a few cases, no panel has ever made a finding on such a situation complaint. WTO, II Analytical Index 668–670 (1995).
Appellate Body Report, EC—Bananas III, ¶ 10.
Id.
Id., ¶ 12.
Panel Reports, EC—Bananas III, ¶¶ 7.10–7.12.
Panel Report, Indonesia—Cars, ¶¶ 14.1–14.2.
Some of the panels that received amicus curiae briefs mention this in express terms in their report (See, e.g., panels in U.S.—Shrimp, ¶ 3.129; U.S.—Section 110(5) Copyright Act, ¶¶ 6.3–6.8; EC—Asbestos, ¶¶ 6.1–6.4; EC—Bed Linen, ¶ 6.1). Amicus Curiae briefs are discussed in Chapter 32 of this book.
The Appellate Body has accepted this practice in the context of appellate review proceedings in noting “the attaching of a brief or other material to the submission of either appellant or appellee, no matter how or where such material may have originated, renders that material at least prima facie an integral part of that participant’s submission.... [A] participant filing a submission is properly regarded as assuming responsibility for the contents of that submission, including any annexes or other attachments.” (Appellate Body Report, US—Shrimp, ¶ 89)
Appellate Body Report, U.S.—Shrimp, ¶ 104.
Id., ¶ 107.
Id., ¶ 108.
Appellate Body Report, EC—Bananas III, ¶ 135.
Id., ¶ 136.
Id., ¶ 132.
Appellate Body Report, Mexico—Corn Syrup (Article 21.5—US), ¶ 74.
Panel Report, Japan—Film, ¶ 10.43.
Article 11 of the Agreement on Safeguards.
Panel Report, Japan—Film, ¶ 10.43.
Appellate Body Report, U.S.—1916 Act, ¶ 61.
However, the requirement in Article 6.2 of the DSU to indicate “whether consultations were held... may be satisfied by an express statement that no consultations were held. In otherwords, Article 6.2 also envisages the possibility that a panel may be validly established without being preceded by consultations.” (Appellate Body Report, Mexico—Corn Syrup (Article 21.5—US), ¶ 62)
Appellate Body Report, Brazil—Aircraft, ¶ 132.
Id.
Articles 4.3 and 4.7 of the DSU. The Appellate Body stated in Mexico—Corn Syrup (Article 21.5—US): When the responding party does not respond to a request for consultations, or declines to enter into consultations, the complaining party may dispense with consultations and proceed to request the establishment of a panel. In such a case, the responding party, by its own conduct, relinquishes the potential benefits that could be derived from those consultations. (Appellate Body Report, Mexico—Corn Syrup (Article 21.5—US), ¶ 59)
Appellate Body Report, Brazil—Desiccated Coconut, at 22, DSR 1997:I, 167, at 186.
Appellate Body Report, Guatemala—Cement I, ¶¶ 72 and 76.
Appellate Body Report, Korea—Dairy, ¶ 120.
Appellate Body Report, Mexico—Corn Syrup (Article 21.5—US), ¶ 70. Moreover, “neither Articles 4 and 6 of the DSU, nor paragraphs 1 to 4 of Article 4 of the SCM Agreement, require a precise and exact identity between the specific measures that were the subject of consultations and the specific measures identified in the request for the establishment of a panel.” (Appellate Body Report, EC—Computer Equipment, ¶ 132)
Appellate Body Report, Korea—Dairy, ¶ 120.
Appellate Body Report, EC—Bananas III, ¶ 143.
Appellate Body Report, India—Patents (US), ¶ 90.
Appellate Body Report, EC—Bananas III, ¶ 141.
Id., ¶ 143. In other words, what the panel request needs to set out with sufficient clarity are the claims, not detailed arguments. (Appellate Body Report, Korea—Dairy, ¶ 123)
Appellate Body Report, Korea—Dairy, ¶ 123.
Id., ¶ 127.
Appellate Body Report, Thailand—H-Beams, ¶ 95.
Id.
The Appellate Body considered that “measures” within the meaning of Article 6.2 of the DSU are not only measures of general application, i.e., normative rules, but also can be the application of tariffs by customs authorities. (Appellate Body Report, EC—Computer Equipment, ¶ 65)
Id., ¶¶ 67 and 103.
The Appellate Body noted that “in disputes under the Anti-Dumping Agreement relating to the initiation and conduct of anti-dumping investigations, a definitive anti-dumping duty, the acceptance of a price undertaking or a provisional measure must be identified as part of the matter referred to the DSB pursuant to the provisions of Article 17.4 of the Anti-Dumping Agreement and Article 6.2 of the DSU.” (Appellate Body Report, Guatemala—Cement I, ¶ 80)
Appellate Body Report, Chile—Price Band System, ¶ 139.
Id., ¶ 144.
Id.
Established on 30 November 1984 (BISD 31S/9).
“This is another specific manifestation of the principle of good faith that, we have pointed out, is at once a general principle of law and a principle of general international law. This pervasive principle requires both complaining and responding Members to comply with the requirements of theDSU(and related requirements in other covered agreements) in good faith.” (Appellate Body Report, U.S.—FSC, ¶ 166)
Appellate Body Report, U.S.—FSC, ¶ 166.
Appellate Body Report, Mexico—Corn Syrup (Article 21.5-U.S.), ¶ 50.
Appellate Body Report, EC—Hormones, ¶ 152.
Appellate Body Report, Mexico—Corn Syrup (Article 21.5-U.S.), ¶ 47.
Appellate Body Report, EC—Hormones, footnote 138 to ¶ 152.
Appellate Body Report, EC—Hormones, footnote 138 to ¶ 152.
Appellate Body Report, Australia—Salmon, ¶ 272. And in ¶ 278: Afundamental tenet of due process is that a party be provided with an opportunity to respond to claims made against it. In this case, we believe that the Panel did accord Australia a proper opportunity to respond by allowing Australia to submit a third written submission. We cannot see how the Panel failed to accord due process to Australia by granting the extra time it had requested.
Appellate Body Report, India—Patents (US), ¶ 92.
The Appellate Body has not found it necessary to follow that approach and has deemed the general DSU disciplines protecting confidential information as sufficient for the appellate review process. Appellate Body Report, Brazil—Aircraft, ¶ 125; Appellate Body Report, Canada—Aircraft, ¶ 147.
Panel Reports in EC—Bananas III, ¶¶ 7.4ff; Panel Report, EC—Hormones (US), ¶¶ 8.12ff.
Appellate Body Report, EC-Hormones, ¶ 154. According to the Appellate Body, a “panel’s decision whether to grant enhanced participatory rights to third parties is thus a matter that falls within the discretionary authority of that panel. Such discretionary authority is, of course, not unlimited and is circumscribed, for example, by the requirements of due process.” Appellate Body Report, U.S.—1916 Act, ¶ 150. In that case, the Appellate Body held that it had not been shown that the panel exceeded the limits of its discretionary authority by granting enhanced third party rights.
The Appellate Body stated that: Article 10.1 directs panels “fully” to take into account the interests of Members other than the parties to the dispute, and Article 10.2 requires panels to grant to third parties “an opportunity to be heard”. Article 10.3 ensures that, up to a defined stage in the panel proceedings, third parties can participate fully in the proceedings, on the basis of the same written submissions as the parties themselves. Article 10.3 thereby seeks to guarantee that the third parties can participate at a session of the first meeting with the panel in a full and meaningful fashion that would not be possible if the third parties were denied written submissions made to the panel before that meeting. Moreover, panels themselves will thereby benefit more from the contributions made by third parties and will, therefore, be better able “fully” to take into account the interests of Members, as directed by Article 10.1 of the DSU. Appellate Body Report, U.S.-FSC (Article 21.5-EC), ¶ 249.
As the Appellate Body noted, “[t]hird parties to a dispute cannot make claims. It was for Argentina, as the claimant, to make its claim; Argentina cannot rely on third parties to do so on its behalf. Moreover, we note that Argentina did not adopt these arguments of the third parties in subsequent proceedings.” Appellate Body Report, Chile-Price Band System, ¶ 163.
Appellate Body Report, U.S.—Wool Shirts and Blouses, at 16, DSR 1997:I, 323, at 335.
Appellate Body Report, Canada—Dairy (Article 21.5—New Zealand and U.S. II), ¶ 66.
Appellate Body Report, EC—Hormones, ¶ 104; Appellate Body Report, Canada-Aircraft, ¶ 192.
Appellate Body Report, U.S.—Wool Shirts and Blouses, at 14, DSR 1997:I, 323, at 335. Moreover, “[t]here is nothing in the WTO dispute settlement system to support the notion that the allocation of the burden of proof should be decided on the basis of a comparison between the respective difficulties that may possibly be encountered by the complainant and the respondent in collecting information to prove a case.” (Appellate Body Report, EC-Sardines, ¶ 281)
Appellate Body Report, Canada—Dairy (Article 21.5—New Zealand and U.S. II), ¶ 66. For example, under the SPS Agreement, this means that: [t]he initial burden lies on the complaining party, which must establish a prima facie case of inconsistency with a particular provision of the SPS Agreement on the part of the defending party, or more precisely, of its SPS measure or measures complained about. When that prima facie case is made, the burden of proof moves to the defending party, which must in turn counter or refute the claimed inconsistency. (Appellate Body Report, EC—Hormones, ¶ 98)
Appellate Body Report, U.S.—Gasoline, at 22–23, DSR 1996:I, 3, at 20–21.
Appellate Body Report, U.S.—Wool Shirts and Blouses, at 15–16, DSR 1997:I, 323, at 337–338.
Appellate Body Report, India—Quantitative Restrictions, ¶ 137.
Appellate Body Report, Thailand—H-Beams, ¶ 134. And in Appellate Body Report, Korea—Dairy, ¶ 145: We find no provision in the DSU or in the Agreement on Safeguards that requires a panel to make an explicit ruling on whether the complainant has established a prima facie case of violation before a panel may proceed to examine the respondent’s defense and evidence.
Appellate Body Report, Argentina—Textiles and Apparel, ¶ 79.
Appellate Body Report, U.S.—Cotton Yarn, ¶ ¶ 77–78.
Appellate Body Report, Argentina—Textiles and Apparel, ¶ 82.
Appellate Body Report, Argentina—Textiles and Apparel, ¶ 84.
Appellate Body Report, EC—Sardines, ¶ 302.
Appellate Body Report, EC—Bed Linen (Article 21.5—India), ¶ 167.
Appellate Body Report, U.S.—Carbon Steel, ¶ 153.
For example, “given that the European Communities itself had submitted no evidence—other than the text of the provision—on this point, the Panel did not act inconsistently with Article 11 in refraining from seeking additional information on its own initiative”. (Appellate Body Report, U.S.—Carbon Steel, ¶ 153)
Appellate Body Report,U.S.—Shrimp, ¶104. In doing so, a panel cannot realistically refer to all statements made by the experts advising it and should be allowed a substantial margin of discretion as towhich statements are useful to refer to explicitly. (Appellate Body Report, EC—Hormones, ¶ 138) The Appellate Body concluded that “the DSU accords to a panel established by the DSB, and engaged in a dispute settlement proceeding, ample and extensive authority to undertake and to control the process by which it informs itself both of the relevant facts of the dispute and of the legal norms and principles applicable to such facts.” (Appellate Body Report, U.S.—Shrimp, ¶ 106)
“A panel may, in fact, need the information sought in order to evaluate evidence already before it in the course of determining whether the claiming or the responding Member, as the case may be, has established a prima facie case or defense.” Appellate Body Report, Canada—Aircraft, ¶ 192.
Appellate Body Report, EC—Hormones, ¶ 147.
Appellate Body Report, EC—Hormones, ¶ 148.
The question whether a panel has assessed, on its own responsibility, the WTO-consistency of a measure based on information received from another source is subject to appellate review. For example, the Appellate Body noted in a dispute that the panel “gave considerable weight to the views expressed by the IMF [International Monetary Fund] in its reply to these questions. However, nothing in the Panel Report supports India’s argument that the Panel delegated to the IMF its judicial function to make an objective assessment of the matter. A careful reading of the Panel Report makes clear that the Panel did not simply accept the views of the IMF. The Panel critically assessed these views and also considered other data and opinions in reaching its conclusions.” (Appellate Body Report, India—Quantitative Restrictions, ¶ 149)
Appellate Body Report, Thailand—H-Beams, ¶ 135. The Appellate Body also dismissed the argument that a panel had no authority to ask a question relating to claims for which the complaining party had not first established a prima facie case, and stated that such an argument was “bereft of any textual or logical basis”. Appellate Body Report, Canada—Aircraft, ¶ 185.
Appellate Body Report, Japan—Agricultural Products II, ¶ 129 (emphasis added).
Appellate Body Report, Canada—Aircraft, ¶ 187.
Id., ¶ 185.
Id., ¶ 192.
Appellate Body Report, U.S.—Wheat Gluten, ¶ 174.
Appellate Body Report, Canada—Aircraft, ¶ 203.
Id., ¶ ¶ 187 and 203—204. And in Appellate Body Report, U.S.—Wheat Gluten, ¶ ¶ 171–173: [T]he refusal by a Member to provide information requested of it undermines seriously the ability of a panel to make an objective assessment of the facts and the matter, as required by Article 11 of the DSU. Such a refusal also undermines the ability of other Members of the WTO to seek the “prompt” and “satisfactory” resolution of disputes under the procedures for which they bargained in concluding the DSU.
Appellate Body Report, U.S.—Wheat Gluten, ¶ ¶ 171–173.
Appellate Body Report, EC—Hormones, ¶ 118.
“There was simply no way for the Panel to make [a determination on the claims raised] without engaging in an examination of [domestic] law. But... the Panel was not interpreting [domestic] law “as such”; rather, the Panel was examining [domestic] law solely for the purpose of determining whether India had met its obligations under the TRIPS Agreement.” Appellate Body Report, India—Patents (U.S.), ¶ ¶ 65–67.
Appellate Body Report, U.S.—Hot-Rolled Steel, ¶ 200. See also, Appellate Body Report, U.S.—Section 211 Appropriations Act, ¶ ¶ 105–106: Thus the municipal law of WTO Members may serve not only as evidence of facts, but also as evidence of compliance or non-compliance with international obligations. Under the DSU, a panel may examine the municipal law of a WTO Member for the purpose of determining whether that Member has complied with its obligations under the WTO Agreement.
Appellate Body Report, U.S.—Wheat Gluten, ¶ 150, citing from Appellate Body Report, Korea—Dairy, ¶ 137.
Appellate Body Report, Australia—Salmon, ¶ 267.
Appellate Body Report, Korea—Dairy, ¶ 137.
Appellate Body Report, EC—Hormones, ¶ 135.
Id., ¶ 138.
Appellate Body Report, EC—Poultry, ¶ 133.
Appellate Body Report, EC—Hormones, ¶133. Appellate Body Report, Japan—Agricultural Products II, ¶ 141.
Appellate Body Report, U.S.—Wheat Gluten, ¶ 151.
Appellate Body Report, Korea—Alcoholic Beverages, ¶ 164.
“A claim that a panel disregarded or distorted the evidence submitted to it is, in effect, a claim that the panel, to a greater or lesser degree, denied the party submitting the evidence fundamental fairness, or what in many jurisdictions is known as due process of law or natural justice.” Appellate Body Report, EC—Hormones, ¶ 133.
Appellate Body Report, U.S.—Carbon Steel, ¶ 142.
Id., The Appellate Body stressed that panels enjoy discretion as the trier of facts; they enjoy a margin of discretion in assessing the value of the evidence, and the weight to be ascribed to that evidence. The Appellate Body will not intervene in the panel’s appreciation of the evidence solely because it might have reached a factual finding different than the one the panel reached; the Appellate Body will intervene only if it is “satisfied that the panel has exceeded the bounds of its discretion, as the trier of facts, in its appreciation of the evidence”. Appellate Body Report, EC—Sardines, ¶ 299.
Appellate Body Report, EC—Hormones, ¶ 117.
Appellate Body Report, U.S.—Cotton Yarn, ¶ 74. Article 17.6 of the Anti-dumping Agreement complements the standard of reviewset out in Article 11 of the DSU for disputes concerning anti-dumping measures. In the current negotiations reviewing the functioning of the Anti-Dumping Agreement, the United States has demanded to clarify the specific standard of review set out in Article 17.6 of that Agreement so as to ensure that panels and the Appellate Body show more deference to determinations made by national anti-dumping authorities.
Appellate Body Report, U.S.—Lamb, ¶ 106.
Id., ¶ 107.
Appellate Body Report, EC—Sardines, ¶ 301.
Appellate Body Report, Korea—Alcoholic Beverages, ¶ 168
Appellate Body Report, Chile—Alcoholic Beverages, ¶ 78.
Appellate Body Report, Mexico—Corn Syrup (Article 21.5—US), ¶ 106.
Id., ¶ 107.
Id., ¶ 108.
For example, “a panel acting pursuant to Article 21.5 of the DSU would be expected to refer to the initial panel report, particularly in cases where the implementing measure is closely related to the original measure, and where the claims made in the proceeding under Article 21.5 closely resemble the claims made in the initial panel proceedings.”(Appellate Body Report, Mexico—Corn Syrup (Article 21.5—US), ¶ 109)
“Thus, if a panel found that a measure was inconsistent with a particular provision of the GATT 1947, it generally did not go on to examine whether the measure was also inconsistent with other GATT provisions that a complaining party may have argued were violated.” Appellate Body Report, U.S.—Wool Shirts and Blouses, at 18.
Appellate Body Report, U.S.—Wool Shirts and Blouses, at 18.
Id., at 19. Moreover, “[j]ust as a panel has the discretion to address only those claims which must be addressed in order to dispose of the matter at issue in a dispute, so too does a panel have the discretion to address only those arguments it deems necessary to resolve a particular claim.” (Appellate Body Report, EC—Poultry, ¶ 135)
Appellate Body Report, Australia—Salmon, ¶ 223.
Appellate Body Report, Canada−Autos, ¶ 116.
Appellate Body Report, Mexico—Corn Syrup (Article 21.5—US), ¶ 36.
A panel need only address those claims which must be addressed in order to resolve the matter in issue in the dispute. Appellate Body Report, U.S.—Wool Shirts and Blouses, at 20.
Appellate Body Report, U.S.—Certain EC Products, ¶ 92
Appellate Body Report, Chile—Alcoholic Beverages, ¶ 79.
DSB Decision of May 14, 2000 (WTO document WT/L/452).
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Zdouc, W. (2005). The Panel Process. In: Macrory, P.F.J., Appleton, A.E., Plummer, M.G. (eds) The World Trade Organization: Legal, Economic and Political Analysis. Springer, Boston, MA. https://doi.org/10.1007/0-387-22688-5_26
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