WTO Panels established to review Chinese barley duties, EU palm oil measures

At a meeting of the Dispute Settlement Body (DSB) on  May 28, WTO members agreed to the establishment of two new dispute panels: one at the request of 2021 Australia regarding Chinese anti-dumping and countervailing duties on Australian barley; and the second at the request of Malaysia concerning European Union measures on palm oil and oil palm crop-based biofuels.

China — Anti-dumping and countervailing duty measures on barley from Australia

Australia submitted its second request for a panel to determine whether China’s decision to impose anti-dumping and countervailing duties on imports of barley from Australia is consistent with WTO rules.  Australia’s first request was blocked by China at the last DSB meeting on 28 April.

Australia noted that China is imposing anti-dumping duties of 73.6% and countervailing duties of 6.9% on Australian barley, and that consultations held on January 28 of this year and subsequent exchanges of information failed to resolve the matter.  As no concrete steps have been taken by China to respond to Australia’s concerns, Australia said it is again requesting the establishment of a panel.  Australia reiterated that it values its strong economic and community ties with China and remained open to further discussions with China on the matter.

China said it would vigorously defend itself in the proceedings and was confident that the duty measures would be found consistent with WTO requirements.  China added that it was open to continued talks with Australia on the matter with the aim of reaching a positive outcome.

The DSB agreed to the establishment of the panel.  Canada, the European Union, the United States, India, Russia, Singapore, Norway, the United Kingdom, Japan, New Zealand, Brazil and Ukraine reserved their rights to participate as third parties in the proceedings.

DS600: European Union and certain Member states — Certain measures concerning palm oil and oil palm crop-based biofuels

Malaysia submitted its second request for a panel to examine certain measures imposed by the European Union and EU member states regarding palm oil and oil palm crop-based biofuels from Malaysia. Malaysia’s first request was blocked by the EU at the DSB meeting on  April 28.  Malaysia said that consultations held on March 17  with the EU regrettably failed to resolve the dispute, so once again it was submitting its request for a panel to examine the matter.

The EU said it regretted Malaysia’s decision to renew its request for a panel but that it believed the measures at stake were fully justified and that it was confident it would prevail in the dispute proceedings.  The EU also said it was ready to discuss interim arrangements which would allow for a possible appeal to be heard in the dispute, mentioning in this regard the multi-party interim appeal arrangement (MPIA).

The DSB agreed to the establishment of a panel.  Thailand, Korea, Brazil, Russia, the UK, the US, Singapore, Guatemala, Australia, Colombia, Indonesia, Japan, Norway, China, Ukraine, India, El Salvador and Canada reserved their rights to participate as third parties in the proceedings.

DS234: United States – Continued Dumping and Subsidy Offset Act of 2000 (CDSOA)

The European Union reiterated its request that the United States cease transferring anti-dumping and countervailing duties to the US domestic industry, arguing that every such disbursement was a clear act of non-compliance with the rulings on this matter.  It said it would continue putting this item on the DSB agenda as long as the US has not fully implemented the ruling.

The United States said it has taken all actions necessary to implement the ruling and that, once a member has said it has complied with a ruling, that member should no longer be required to submit status reports on implementation.  The US said the EU was not asking other WTO members to submit status reports where these members have said they achieved compliance with the rulings in question.

The EU countered that the cases cited by the US were different from the CDSOA dispute, where the US was continuing to make disbursements of duties collected to US firms and where the WTO has authorized the EU and other members to impose retaliatory measures against the US for its non-compliance with the ruling.

Canada voiced its support for the EU position and said it would maintain its position that this item remain on the DSB agenda until the US stopped transferring collected duties to US industry.

DS316: European Communities and Certain Member States – Measures affecting trade in large civil aircraft: Implementation of the recommendations adopted by the DSB

The United States said that once again the European Union has failed to provide a status report to the DSB concerning dispute DS316, the US complaint against government subsidies for the European aircraft manufacturer Airbus. The US said the EU is making the erroneous claim that by submitting a communication claiming that it has complied with the ruling in DS316, the EU as the responding party no longer needs to file a status report, even though the US as the complaining party does not agree with the EU’s assertion that it has complied.The EU once again countered that no status report was required since the dispute proceedings were not concluded. 

The EU notified a new set of compliance measures and those measures were subject to a panel ruling in December 2019 that was appealed by the EU shortly thereafter.  The EU is concerned that, with the current blockage of the two-tiered multilateral dispute system, it is losing the possibility of a proper appellate review of the serious flaws contained in that compliance panel report.  While the blockage continues, the EU said it stands ready to discuss with the US alternative ways to deal with this appeal.

Appellate Body appointments

Mexico, speaking on behalf of 121 members, once again introduced the group’s proposal to start the selection processes for filling vacancies on the Appellate Body.  The extensive number of members submitting the proposal reflects a common concern with the current situation in the Appellate Body that is seriously affecting the overall WTO dispute settlement system against the best interest of members, Mexico said for the group.

Nearly 20 members took the floor to reiterate the importance of resolving the impasse over the appointment of new members as soon as possible and re-establishing a functioning Appellate Body.  Some delegations described a two-tier dispute settlement system, with a panel and appeals stage, as a core part of the multilateral trading system, and that restoring it was a key element of any future reform of the WTO.  The absence of a functioning Appellate Body also undermines the right of all WTO members, several delegations noted.

The United States said it was not in a position to support the proposed decision.  The US continues to have systemic concerns with the Appellate Body, which it has explained and raised for more than 16 years and across multiple administrations.  The US said it looked forward to further discussions with members on those concerns.

Surveillance of implementation

The United States presented status reports with regard to DS184, “US — Anti-Dumping Measures on Certain Hot-Rolled Steel Products from Japan”,  DS160, “United States — Section 110(5) of US Copyright Act”, DS464, “United States — Anti-Dumping and Countervailing Measures on Large Residential Washers from Korea”, and DS471,”United States — Certain Methodologies and their Application to Anti-Dumping Proceedings Involving China.”

The European Union presented a status report with regard to DS291, “EC — Measures Affecting the Approval and Marketing of Biotech Products.”

Indonesia presented its status reports in DS477 and DS478, “Indonesia — Importation of Horticultural Products, Animals and Animal Products.”

Next DSB meeting

The next DSB meeting will take place on  June 28, 2021.

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