Dispute settlement Dispute settlement • WTO dispute settlement had a demanding year in 2013, with adjudicating bodies examining 28 disputes on issues from green energy production to the banning of seal products. • In 2013, the WTO received 20 “requests for consultations” – the first stage in the dispute settlement process – the third- highest number of requests filed in the last ten years. • The Dispute Settlement Body established 12 new panels in 2013 to adjudicate 14 cases. • Four panel reports and two Appellate Body reports were adopted by the Dispute Settlement Body in 2013. Dispute settlement World Trade Organization 80 www.wto.org/disputes Annual Report 2014 Dispute settlement Dispute settlement activity in 2013 82 Appellate Body 93 SETTLEMENT DISPUTE Background on dispute settlement WTO members bring disputes to the WTO if they think their rights under trade agreements are being infringed. Settling disputes is the responsibility of the Dispute Settlement Body. World Trade Organization Dispute settlement Annual Report 2014 www.wto.org/disputes 81 Dispute settlement Dispute settlement activity in 2013 It was a demanding year for WTO dispute settlement in 2013, with adjudicating bodies examining 28 disputes on issues from green energy production to the banning of seal products. The Dispute Settlement Body (DSB), which met 13 times, received 20 requests for consultations, the first stage in the dispute settlement process. Developing countries launched nine of the requests, with Latin America particularly active. The rising workload poses challenges for the WTO Secretariat. On a positive note, the WTO’s Digital Dispute Settlement Registry moved into its testing phase. As well as participation by frequent dispute settlement The DSB authorized Antigua and Barbuda to impose trade participants such as the European Union, China, the United retaliation measures against the United States for not fully States and Japan, newer members such as Russia have been complying with the DSB’s recommendations and rulings in a active in initiating dispute settlement proceedings. Members with dispute over online gambling. It referred to arbitration a request less experience in dispute settlement such as Cuba, Namibia, by Indonesia to take trade retaliation measures against the Zambia and Zimbabwe participated in dispute settlement in United States in a dispute over flavoured cigarettes. Finally, an 2013 (see Table 3), either initiating disputes in the case of Cuba arbitration award was circulated establishing the reasonable or taking part in them as third parties in the case of the others. period of time for China to implement DSB rulings and recommendations in a dispute over countervailing and anti- An overview of dispute settlement activity dumping duties on certain electrical steel imports from the During 2013, the DSB received 20 “requests for consultations”, United States. which is the first stage in the WTO’s dispute settlement process. Although less than the record 27 in 2012, it is still the Information about the disputes, including the reports adopted by third-highest number of requests filed in the last ten years. In the DSB, can be found in Table 1. addition to these new matters, 28 active disputes were already proceeding through adjudication, whether before the Appellate Body, panels or in arbitration. The DSB established 12 new panels in 2013 to adjudicate 14 new matters. Where more than one complaint deals with the same matter, they may be Background on dispute settlement activity adjudicated by a single panel. The General Council convenes as the Dispute Settlement The DSB referred two requests for compliance panels back to Body (DSB) to deal with disputes between WTO members. the panels that had originally adjudicated the disputes. This is Such disputes may arise with respect to any agreement the usual approach in compliance proceedings. A compliance contained in the Final Act of the Uruguay Round that is subject to the Understanding on Rules and Procedures panel is established when there is disagreement between the Governing the Settlement of Disputes (DSU). The DSB has original parties as to whether the losing party has brought its authority to establish dispute settlement panels, refer matters measure into line with WTO rules following an adjudication to arbitration, adopt panel, Appellate Body and arbitration process. These cases were the Canadian and Mexican reports, maintain surveillance over the implementation of complaints against US labelling requirements for meat products recommendations and rulings contained in such reports, and and China’s complaint against EU anti-dumping measures on authorize suspension of concessions in the event of non- steel fasteners (see page 91). compliance with those recommendations and rulings. The DSB adopted four panel reports and two Appellate Body reports. Panels issued reports in disputes concerning Chinese anti-dumping duties on EU x-ray scanners, Chinese anti- dumping and countervailing measures on US broiler products, and Canada’s measures related to Ontario’s renewable energy sector in disputes brought by the European Union and Japan (see Table 1). The Appellate Body reports concerned the same disputes over Ontario’s renewable energy measures. A compliance panel report was circulated in a dispute brought by Mexico over US anti-dumping measures on stainless steel but it was not adopted by the DSB because the parties reached an agreement on how to resolve their dispute. Dispute settlement World Trade Organization 82 www.wto.org/disputes Annual Report 2014 Dispute settlement Table 1: Panel and Appellate Body reports circulated in 2013* Dispute Document Complainant(s) Respondent Third parties WTO agreements Date of symbol covered adoption by DSB China – X-Ray WT/DS425/R European Union China Chile, India, Japan, Anti-Dumping 24 April 2013 Equipment Norway, Thailand, Agreement United States Canada – WT/DS412/AB/R Japan Canada Australia, Brazil, Agreement on Subsidies 24 May 2013 Renewable China, El Salvador, and Countervailing WT/DS412/R Energy European Union, Measures (SCM) Honduras, India, Saudi Agreement on Trade Arabia, Korea, Mexico, Related Aspects of Norway, Chinese Investment Measures Taipei, United States (TRIMs) GATT 1994 DSU Canada – WT/DS426/ European Union Canada United States, Japan, SCM Agreement 24 May 2013 Feed In Tariff AB/R Australia, China, TRIMs Program Chinese Taipei, WT/DS426/R India, Saudi Arabia, GATT 1994 Brazil, Korea, Mexico, DSU Norway, Turkey, El SETTLEMENT DISPUTE Salvador China – Broiler WT/DS427/R United States China Chile, European SCM Agreement 25 September Products Union, Japan, Mexico, 2013 Anti-Dumping Norway, Saudi Arabia, Agreement Thailand EC – Seal WT/DS400/R Canada European Argentina, China, GATT 1994 [Panel report Products Union Colombia, Ecuador, under appeal] TBT Agreement Iceland, Japan, Mexico, Norway, Russia, United States EC – Seal WT/DS401/R Norway European Argentina, Canada, GATT 1994 [Panel report Products Union China, Colombia, under appeal] TBT Agreement Ecuador, Iceland, Japan, Mexico, Agreement on Namibia, Russia, Agriculture United States US – Stainless WT/DS344/RW Mexico United Brazil, China, the Final report not Unadopted Steel (Mexico) States European Union, circulated to WTO (mutually (Article 21.5 – Japan, Korea members (mutually agreed Mexico) agreed solution) solution) *Appellate Body reports are rows shaded in blue. Further information on these reports is provided in Table 4 on page 93. World Trade Organization Dispute settlement Annual Report 2014 www.wto.org/disputes 83 Dispute settlement Which WTO members were active in 2013? Figure 1: Requests for consultations Developing countries launched nine of the 20 new requests in 2013, by complainant for consultations filed in 2013 (see Figure 1). Latin Number of consultations in 2012, by complainant American members initiated five, with Argentina the most active from the region with two complaints. Cuba initiated its Argentina 2 first-ever dispute, a complaint against Australia’s measures China 1 on plain packaging for tobacco products. This brings to five Cuba 1 the number of complaints brought by WTO members against Denmark/ 1 Australia’s plain packaging requirements. A number of Asian Faroe Islands European Union 3 members were active, including Indonesia and Japan, each 2 submitting two requests for consultations. Russia, which Guatemala 1 acceded to the WTO in 2012, was active as a complainant, a Indonesia 2 respondent and as a third party. Japan 2 Table 2 shows requests for consultations made during 2013 Korea, Rep. of 1 and the status of those requests. It highlights the strong New Zealand 1 participation of developing countries in the system. Panama 1 Russian Table 2 shows the variety of WTO agreements raised Federation 1 in disputes initiated in 2013. All disputes initiated United States 3 included challenges under the General Agreement on 0 1 2 3 4 5 6 Tariffs and Trade (GATT) 1994. Since 1995, 375 of the Number of consultations 474 requests for consultations have included a claim under this agreement. Disputes under the Subsidies and Countervailing Measures (SCM) Agreement and Figure 2: Requests for consultations the Anti-Dumping (ADP) Agreement have also arisen in 2013, by respondent more frequently since 1995 than disputes under other Number of consultations in 2013, by respondent agreements. Figure 3 shows the number of times an agreement has been referred to in requests for Australia 2 consultations since 1995. Brazil 1 Subject matter of the disputes China 1 Table 2 shows that WTO members are litigating in many Colombia 1 different trade areas (see Figure 3). Current disputes European Union 1 4 include complaints concerning: measures imposed by India Colombia on the importation of textiles, clothing and 1 footwear; a recycling fee imposed by Russia on motor Indonesia 3 vehicles; and anti-dumping duties imposed by China on high Pakistan 1 performance seamless stainless steel tubes from Japan and Peru 1 Russian the European Union. 2 Federation A sharp increase in panels during 2013 Ukraine 1 Dispute settlement was very active in 2013, due in no small United States 2 part to last year’s record requests for consultations (see 0 87654321 Figures 1, 2 and 4).