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The Future of Trade Defence Instruments pp 107–124Cite as

EU – Price Comparison Methodologies (DS516): Interpretation of Section 15 of China’s WTO Accession Protocol

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Part of the book series: European Yearbook of International Economic Law ((Spec. Issue))

Abstract

The article elaborates the issue regarding the interpretation of Section 15 of China’s WTO Accession Protocol and dismisses the legal opinions of the European Union and the United States in European Union – Price Comparison Methodologies (DS516). The so-called “shifting in burden of proof” approach held by the European Union and the United States actually only terminates part of Section 15(a)(ii), and it also self-contradictory with the other two claims held by the European Union and the United States at the same time in the same case, i.e., the chapeau and (i) of Section 15(a) are still valid and Section 15 is not an exception clause. Based on the structure of Section 15 and the Interpretation of Section 15 by the Appellate Body in EC – Fasteners, which are not necessarily dicta, the article concludes that Section 15(a) as a whole has expired. In addition, China may try to claim that its Accession Protocol which is a contractual agreement deserves a different more flexible interpretation method, which is not rare in the practice of general international law.

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Notes

  1. 1.

    Miranda (2014, 2016a, b, c), Gatta (2014a, b), Posner (2014), Graafsma and Kumashova (2014), Nicely (2014), Stewart et al. (2014), Rosenthal and Beckington (2014), Ruessmann and Beck (2014), O’Connor (2015), Vermulst et al. (2016), Zhenghao (2016), Noel (2016), and Searles (2016).

  2. 2.

    Request for Consultations by China, European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, 15 December 2016.

  3. 3.

    Appellate Body Report, European Union – Anti-Dumping Measures on Biodiesel from Argentina, WT/DS473/AB/R, adopted 15 July 2011, DSR 2016:IV, para. 289.

  4. 4.

    Miranda (2014), p. 101, fn. 24; Posner (2014), p. 151, O’Connor (2015), p. 179; Miranda (2016b), p. 309.

  5. 5.

    In this case, the EU’s first written submission and the US’ third party submission and legal interpretation to the panel have been made public, while China has only released its opening statement at the Panel’s meeting. First Written Submission by the European Union, European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, 14 November 2017, para. 117.

  6. 6.

    Legal Interpretation Submitted by the United States, European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, para. 8.7.

  7. 7.

    Black (2010), p. 166.

  8. 8.

    Black (2010), p. 176.

  9. 9.

    Appellate Body Report, Canada – Certain Measures Concerning Periodicals, WT/DS31/AB/R, adopted 30 July 1997, DSR 1997:II.

  10. 10.

    Appellate Body Report, United States – Import Prohibition of Certain Shrimp and Shrimp Products, Recourse to Article 21.5 of the DSU by Malaysia, WT/DS58/AB/RW, adopted 21 November 2001, DSR 2001:IV, para. 107.

  11. 11.

    Appellate Body Report, United States – Measures Affecting the Cross-Border Supply of Gambling and Betting Services, WT/DS285/AB/R, adopted 20 April 2005, DSR 2005:V. para. 131.

  12. 12.

    Gao (2018), p. 22.

  13. 13.

    See the relevant analysis below.

  14. 14.

    Opening Statement by Ambassador Zhang Xiangchen as a part of the Oral Statement of China at the First Substantive Meeting of the Panel in the dispute: European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, 6 December 2017, para. 7.

  15. 15.

    Legal Interpretation Submitted by the United States, European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, para. 8.5.1.

  16. 16.

    Legal Interpretation Submitted by the United States, European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, para. 8.5.

  17. 17.

    European Union First Written Submission, European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, para. 110.

  18. 18.

    Bernard O’Connor, Market-economy status for China is not automatic, November 2011, http://www.voxeu.org/article/china-market-economy (last accessed 30 April 2018).

  19. 19.

    Miranda (2014), p. 99; Stewart et al. (2014), p. 276.

  20. 20.

    Graafsma and Kumashova (2014), pp. 156–157.

  21. 21.

    See the relevant analysis below.

  22. 22.

    Emphasis added by the author.

  23. 23.

    European Union First Written Submission, European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, para. 113.

  24. 24.

    Graafsma and Kumashova (2014), p. 156.

  25. 25.

    Appellate Body Report, United States – Standards for Reformulated and Conventional Gasoline, WT/DS2/AB/R, adopted 29 April 1996, DSR 1996:I, para. 23.

  26. 26.

    European Union First Written Submission, European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, para. 103 (emphasis added).

  27. 27.

    Legal Interpretation Submitted by the United States, European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, para. 8.3.3.

  28. 28.

    Legal Interpretation Submitted by the United States, European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, paras. 8.3.3 and 8.3.6.

  29. 29.

    European Union First Written Submission, European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, para. 49.

  30. 30.

    Appellee Submission of China, European Communities – Definitive Anti-Dumping Measures on Certain Iron or Steel Fasteners from China, WT/DS397/AB/8, para. 49.

  31. 31.

    Appellate Body Report, European Communities – Definitive Anti-Dumping Measures on Certain Iron or Steel Fasteners from China, WT/DS397/AB/R, adopted 15 July 2011, DSR 2011:II, para. 289.

  32. 32.

    First Written Submission by the European Union, European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, 14 November 2017, para. 76.

  33. 33.

    First Written Submission by the European Union, European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, 14 November 2017, para. 77.

  34. 34.

    First Written Submission by the European Union, European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, 14 November 2017, para. 80.

  35. 35.

    Legal Interpretation Submitted by the United States, European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, para. 8.6.

  36. 36.

    Appellate Body Report, European Communities – Definitive Anti-Dumping Measures on Certain Iron or Steel Fasteners from China, WT/DS397/AB/R, adopted 15 July 2011, DSR 2011:II, para. 290 (emphasis added).

  37. 37.

    First Written Submission by the European Union, European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, 14 November 2017, para. 98 (footnotes omitted).

  38. 38.

    Appellate Body Report, European Communities – Anti-Dumping Duties on Imports of Cotton-type Bed Linen from India, WT/DS141/AB/R, adopted 1 March 2001, DSR 2000:XIII, para. 59.

  39. 39.

    Section 3.1 of China’s Accession Protocol: “This Protocol, which shall include the commitments referred to in paragraph 342 of the Working Party Report, shall be an integral part of the WTO Agreement.”

  40. 40.

    Qin (2003), pp. 509–518.

  41. 41.

    In China – Publications and Audiovisual Products, the Appellate Body found that, by virtue of the introductory clause of Section 5.1 of China’s Accession Protocol, China could, in that dispute, invoke Article XX(a) of GATT 1994 to justify provisions found to be inconsistent with China’s trading rights commitments under its Accession Protocol. (Appellate Body Report, China – Measures Affecting Trading Rights and Distribution Services for Certain Publications and Audiovisual Entertainment Products, WT/DS363/AB/R, adopted 21 December 2009, DSR 2009:III, paras. 216–230). However, in China – Raw Materials, the Appellate Body pointed out that paragraph 11.3 of China’s Accession Protocol “does not include any express reference to Article XX of the GATT 1994, or to provisions of the GATT 1994 more generally”. They drew a contrast between the text of paragraph 11.3 and the language contained in paragraph 5.1, paragraph 11.1, paragraph 11.2, which include such general references. Such “omission” in paragraph 11.3 suggest that WTO Members did not intend to incorporate the defences available under Article XX GATT 1994 of into paragraph 11.3. (Appellate Body Report, China – Measures Related to the Exportation of Various Raw Materials, WT/DS394/ABR, adopted 30 January 2012, DSR 2011:V, paras. 278–304).

  42. 42.

    Opening Statement by Ambassador Zhang Xiangchen as a part of the Oral Statement of China at the First Substantive Meeting of the Panel in the dispute: European Union – Measures Related to Price Comparison Methodologies, WT/DS516/1, 6 December 2017, paras. 10–11 (footnotes omitted).

  43. 43.

    Lauterpacht (1927), pp. 155–202.

  44. 44.

    Wright (1929), pp. 102–104.

  45. 45.

    ICJ Reports, Reservations to the Convention on the Prevention and Punishment of the Crime of Genocide, Advisory Opinion of May 28th, 1951, para. 23, p. 12.

  46. 46.

    Pauwelyn (2003), pp. 909–910.

  47. 47.

    Draft Articles on the Law of Treaties with Commentaries, 1966, Yearbook of the International Law Commission, 1966, Vol. II, para. 219.

  48. 48.

    First report on subsequent agreements and subsequent practice in relation to treaty interpretation by Georg Nolte, Special Rapporteur, UN Doc. A/CN.4/660, 19 March 2013, para. 28.

  49. 49.

    First report on subsequent agreements and subsequent practice in relation to treaty interpretation by Georg Nolte, Special Rapporteur, UN Doc. A/CN.4/660, 19 March 2013, para. 11.

  50. 50.

    First report on subsequent agreements and subsequent practice in relation to treaty interpretation by Georg Nolte, Special Rapporteur, UN Doc. A/CN.4/660, 19 March 2013, para. 13.

  51. 51.

    First report on subsequent agreements and subsequent practice in relation to treaty interpretation by Georg Nolte, Special Rapporteur, UN Doc. A/CN.4/660, 19 March 2013, paras. 19–20.

  52. 52.

    Report of the International Law Commission, 65th session, 2013, UN Doc. A/68/10, paras. 19–20.

  53. 53.

    Report of the International Law Commission, 65th session, 2013, UN Doc. A/68/10, para. 18.

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Acknowledgements

The article is supported by the National Social Science Fund of China (Grant No. 13CFX115) and the Chinese Ministry of education of Humanities and Social Science Project (Grant No. 12YJC820023).

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Authors and Affiliations

  1. Law School, Xiamen University, Xiamen, Fujian Province, P.R. China

    Dong Fang

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  1. Faculty of Law, Saarland University, Saarbrücken, Germany

    Marc Bungenberg

  2. Institute of European and International Economic Law, University of Bern, Bern, Switzerland

    Michael Hahn

  3. University of Passau, Passau, Germany

    Christoph Herrmann

  4. Cleary Gottlieb Steen & Hamilton LLP, Brussels, Belgium

    Till Müller-Ibold

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Fang, D. (2018). EU – Price Comparison Methodologies (DS516): Interpretation of Section 15 of China’s WTO Accession Protocol. In: Bungenberg, M., Hahn, M., Herrmann, C., Müller-Ibold, T. (eds) The Future of Trade Defence Instruments. European Yearbook of International Economic Law(). Springer, Cham. https://doi.org/10.1007/978-3-319-95306-9_6

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