WT/DS246/AB/R

7 April 2004

European Communities – Conditions for the Granting of Tariff Preferences to Developing Countries

Report of the Appellate Body

 

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George Abi-Saab (Presiding Member)

Luiz Olavo Baptista

Giorgio Sacerdoti

 

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r$NBP>]HO0O(B>$B#1!%#1#9#9#4G/$N#G#A#T#T#1!%#1>r$Hr9`$H$N4X78(B(The Relationship Between Article I:1 of the GATT 1994 and the Enabling Clause)

$B!!#E#C$O!"-!r9`$O#1#9#9#4G/$N#G#A#T#T#1!%#1>r$N!VNc30(B(exception)$B!W$GKcLt4XO"FCJL@)EY$r@5Ev2=$9$k$?$a$N!V@Q6KE*93J[(B(affirmative defence)$B!W$G$"$k$H$7$?%Q%M%kG'Dj$O8m$j$G$"$C$?!"-"r9`$H#1#9#9#4G/$N#G#A#T#T#1!%#1>r$OF1%l%Y%k$K$"$jr9`$O#1!%#1>r$NE,MQ$rGS=|$9$k$?$a(B(the Enabling Clause exist $B!H(Bside-by-side and on an equal level$B!I(B with Article I:1, and applies to the exclusion thereof, rather than as an exception thereto)$B!"%$%s%I$,r9`$K4p$E$/?=N)$r9T$C$F$$$J$$$3$H$rF'$^$($F>e5i0Q0w2q$OKcLt4XO"FCJL@)EY$Hr9`$H$N@09g@-$r8!F$$9$Y$-$G$O$J$$!"$H(85)$B!#(B

$B!!>e5i0Q0w2q$Or9`$,#1#9#9#4G/$N#G#A#T#T#1!%#1>r$NE,MQ$rGS=|$;$:!"$`$7$mF1#1!%#1>r$NNc30>r9`$G$"$k$H$N%Q%M%kG'Dj$r;Y;}$7$?!#-!(BUS – Wool Shirts and Blouses$B>e5i0QJs9p$K$h$l$P!"K\7o$K$*$1$kN)>Z@UG$$NG[J,$r7h$a$k$?$a$K$O!"%$%s%I$,KcLt4XO"FCJL@)EY$Nr9`Hs@09g@-$K$D$$$F$N!V?=N)!W$r9T$o$J$1$l$P$J$i$J$$$N$+!"$"$k$$$O#E#C$,KcLt4XO"FCJL@)EY$Nr9`@09g@-$r!V93J[!W$H$7$F1gMQ$7$J$1$l$P$J$i$J$$$N$+(B(whether India must raise a $B!H(Bclaim$B!I(B and prove that the Drug Arrangements are inconsistent with the Enabling Clause, or whether the European Communities must raise and prove, in $B!H(Bdefence$B!I(B that the Drug Arrangements are consistent with the Enabling Clause, in order to justify the alleged inconsistency of the Drug Arrangements with Article I:1)$B$rH=CG$9$kI,MW$,$"$k(B(87)$B!"-"2a5n$N>e5i0Q0w2qJs9p$K$h$l$P!"$"$k>r9`$,!"K\Mh$J$i$PJL$N>r9`$N0cH?$H$J$kAu67$K$*$$$F5vMF$9$k$h$&$J>l9g$G!"$+$D$3$N#2$D$N>r9`$N$$$:$l$+$,B>J}$N>r9`$K8@5Z$7$F$$$k>l9g$K$O!"A0r9`$,8er9`$NE,MQGS=|$r<(:6$7$F$$$k>l9g$K8B$j!"?=N)9q$,A0r9`$K$D$$$FN)>Z@UG$$rIi$$(B(In cases where one provision permits, in certain circumstances, behaviour that would otherwise be inconsistent with an obligation in another provision, and one of the two provisions refers to the other provision, the Appellate Body has found that the complaining party bears the burden of establishing that a challenged measure is inconsistent with the provision permitting particular behaviour  only  where one of the provisions suggests that the obligation is not applicable to the said measure)$B!"$=$l0J30$N>l9g$K$OA0r9`$ONc30$"$k$$$O93J[$H$7$FHo?=N)9q$,N)>Z@UG$$rIi$&(B(88)$B!"-##1#9#9#4G/$N#G#A#T#T#1!%#1>r5Z$Sr9`$NJ88@$NDL>o$N0UL#$+$i!"r9`%Q%i#1$OES>e9q$K0[$J$k$+$D0lAXM-Mx$JBT6x$rM?$($k$?$a$K#1#9#9#4G/$N#G#A#T#T#1!%#1>r$N5AL3$NLH=|$rG'$a$?(B(Paragraph 1 thus excepts Members from complying with the obligation contained in Article I:1 for the purpose of providing differential and more favorable treatment to developing countries, provided that such treatment is in accordance with the conditions set out in the Enabling Clause)$BNc30>r9`$@$H2r$5$l$k(B(89-90)$B!"-$r9`$O!"@h?J9q$,ES>e9q$N!V7P:Q3+H/(B(economic development)$B!W$rB%$9$?$a$K:N$k$Y$-!V@Q6KE*$JEXNO(B(positive efforts)$B!W$H$7$F!"#W#T#O6(Dj$Nr9`$rNc30$H$_$J$7$F$b$3$NL\E*$NC#@.$,K8$2$i$l$kLu$G$O$J$$(B(91-94)$B!"-$4D6-J]8n$b#W#T#O6(Dj$NL\E*$N$R$H$D$H$$$($k$,!"4D6-J]8n$K$D$$$F$b#1#9#9#4G/$N#G#A#T#T#2#0>r(B(g)$B$K$h$jNc30$H$7$F5,Dj$5$l$F$$$k(B(95-97)$B!"-%0J>e$rF'$^$(!"r9`$,#1#9#9#4G/$N#G#A#T#T#1!%#1>r$N!VNc30!W$G$"$k$H$$$&%Q%M%kG'Dj$r;Y;}$9$k(B(98-99)$B!"-&$5$i$K!"$"$kAr0cH?$HG'Dj$5$l$F=i$a$F$=$NAr9`$G@5Ev2=$5$l$&$k$+H]$+$,LdBj$H$J$k$N$G$"$j!"r9`$O#1#9#9#4G/$N#G#A#T#T#1!%#1>r$NE,MQ$rGS=|$9$k$o$1$G$O$J$$(B(100-103)$B!#(B

$B!!>e5i0Q0w2q$O!"0J2<$N$h$&$JM}M3$GN)>Z@UG$$K4X$9$k%Q%M%kG'Dj$r0lIt=$@5$7!"(B(i)$BK\7o$K$*$$$F$O$^$:%$%s%I$,KcLt4XO"FCJL@)EY$N0cK!@-$rr9`$NLdBj$rDs5/$9$kI,MW$,$"$k$,!"KcLt4XO"FCJL@)EY$,r9`$K$h$C$F@5Ev2=$5$l$k$3$H$K$D$$$F$O#E#C$,N)>Z@UG$$rIi$&(B(it was incumbent upon India to raise the Enabling Clause in making its claim of inconsistency with Article I:1 of the GATT 1994, but that the European Communities bore the burden of proving that the Drug Arrangements satisfy the conditions of the Enabling Clause, in order to justify those Arrangements under that Clause)$B!"(B(ii)$BK\7o$K$*$$$F%$%s%I$Or9`%Q%i#2(B(a)$B$NLdBj$rDs5/$7$F$$$k$H$$$($k(B(India sufficiently raised paragraph 2(a) of the Enabling Clause in making its claim of inconsistency with Article I:1 before the Panel)$B!"$H=R$Y$?!#-!(BUS – Wool Shirts and Blouses$B>e5i0QJs9p$G=R$Y$?$h$&$K!"!VNc30!W$K$D$$$F$NN)>Z@UG$$ODL>oHo?=N)9q$,Ii$$!"$7$?$,$C$FK\7o$K$*$$$F$O#E#C$,r9`$K$h$C$FKcLt4XO"FCJL@)EY$,@5Ev2=$5$l$k$3$H$K$D$$$F$NN)>Z@UG$$rIi$&$,!"(Bjura novit curia$B!J:[H==j$OK!$rCN$k!K$N86B'$K$h$l$P!"#E#C$Or9`$NFCDj$N5,Dj$K$D$$$F$NK!E*2rZ5r$r<($;$P$h$$(B(it is not the responsibility of the European Communities to provide us with the legal interpretation to be given to a particular provision in the Enabling Clause; instead, the burden of the European Communities is to adduce sufficient evidence to substantiate its assertion that the Drug Arrangements comply with the requirements of the Enabling Clause)(104-105)$B!"-"r9`$K4p$E$/93J[$r(B$BDs5/$9$k(B$BK!E*@UG$(B(legal responsibility for raising a defence)$B$K$D$$$F$O!"r9`$N#W#T#OBN@)$K$*$1$kLr3d$N=EMW@-$d$=$NFbMF!"#1#9#7#1G/$N%&%'%$%P!<7hDj$+$i8=:_$^$G$NNr;KE*7P0^$+$i?d;!$5$l$kr9`$NFCJL$J0LCV$E$1!"$^$?r9`$K4p$E$/Ar$N0cH?$H$J$k$,r9`$NMW7o$rK~$?$9>l9g$K$O#1>r$N5AL3$rLH=|$5$l$k$H$$$&;v>p$K4U$_!"r9`$K4p$E$-:N$i$l$?Ar0cH?$r(legal basis of the complaint sufficient to present the problem clearly)$B!W$r<($7$?$H$O$$$($J$$(B(106-110)$B!"-#r9`$K$O#1#9#9#4G/$N#G#A#T#T#1!%#1>r$+$i$N0oC&$,G'$a$i$l$k$?$a$N$5$^$6$^$JMW7o$,5,Dj$5$l$F$*$j!"$3$N$h$&$J5,Dj$O!V?=N)$NK!E*:,5r!W$^$?J6Ah$N!VLdBj!W$r9=@.$9$k$b$N$H$$$(!"?=N)9q$O?.5AB'$K=>$$%Q%M%k@_CVMW@A$NCf$GLdBj$H$9$kr9`$N>r9`$rFCDj$7!"(111-113)$B!"-$2CLA9q$Or9`$K4p$E$-#1>r$N5AL3$r0oC&$7ES>e9q$K!V0[$J$k$+$D0lAXM-Mx$JBT6x!W$rM?$($k$3$H$r(B$B>)Ne$5$l$F$$$k(B(encouraged)$B$H$$$&$3$H$+$i$b!"(B$BHo?=N)9q(B$B$,$I$N$h$&$JMWAG$K4p$E$-93J[$7$J$1$l$P$J$i$J$$$N$+!"(B$B?=N)9q(B$B$,E&<($7$J$1$l$P$J$i$J$$(B(a complaining party has to define the parameters within which the responding party must make that defence)(111, 114)$B!"-%$^$?!"#E#C$,KcLt4XO"FCJL@)EY$rr9`$K$h$C$F@5Ev2=$7$h$&$H$9$k$3$H$O?=N)9q$N%$%s%I$K$b==J,M=B,$7$($?$3$H$G$"$j(B(would have been well aware)$B!"%$%s%I$O!VEv3:J6Ah$r2r7h$9$k$?$a$K@?(engage in [dispute settlement] procedures in good faith in an effort to resolve the dispute)$B!W$?$a?=N)9q$H$7$Fr9`$NFCDj$N>r9`$K4X$9$k?=N)$rE83+$9$kI,MW(B$B$,$"$k(B(India, as the complaining party, should reasonably have articulated its claims of inconsistency with specific provisions of the Enabling Clause) (115-117)$B!"-&$7$+$70J>e$O!"%$%s%I$,r9`$K$D$$$FN)>Z@UG$$rIi$&$H$$$&$3$H$G$O$J$/!"r9`$K$h$C$FAZ@UG$$O#E#C$,Ii$$!"%$%s%I$N@UG$$O$"$/$^$Gr9`$N>r9`$rFCDj$9$k5AL3$K$H$I$^$k(B(115, 118)$B!"-'K\7o$K$*$$$F%$%s%I$O!"6(5DMW@A$H%Q%M%k@_CVMW@A$NCf$Gr9`%Q%i#2(B(a)$B!"#3(B(a)$B!"#3(B(c)$B$K8@5Z$7!"$^$?%Q%M%k$X$NDs=P=qLL$NCf$G!"KcLt4XO"FCJL@)EY$,r9`%Q%i#2(B(a)$B$NMW7o$rK~$?$7$F$$$J$$$H$$$&@bL@$r9T$C$F$*$j!">e=R$7$?r9`$NLdBj$rDs5/$9$k@UG$$r2L$?$7$F$$$k$H$$$($k(B(119-122)$B!#(B

 

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$B!!>e5i0Q0w2q$O$^$:!"K\7o>eAJ$NHO0O$K$D$$$FEv;v9q$O!"%Q%M%k$,AhE@$H$J$C$F$$$J$$LdBj!J#E#C$O0lIt$NES>e9q$r#G#S#P!J0lHLFC7C@)EY!K$NBP>]$+$iGS=|$G$-$k$+(B(whether the EC could exclude from its GSP scheme countries claiming developing country status)$B!"#E#C$NES>e9q$NJ,N`$Or9`$NMW7o$rK~$?$7$F$$$k$+(B(whether the EC$B!G(Bs mechanisms for the gradation of developing countries meet the requirements of the Enabling Clause)$B!K$K$D$$$F$b0E$KG'Dj$r9T$C$?$H(128)$B!"-"0J>e$rF'$^$(!">e5i0Q0w2q$O!"%$%s%I$N?=N)$,!"KcLt4XO"FCJL@)EY$,r9`%Q%i#2(B(a)$BCm#3$N!VL5:9JL$N!W$H$$$&J88@$K@09gE*$+H]$+$H$$$&LdBj$K8B$i$l$F$$$k$b$N$H2r$9(B(129)$B!"-#$^$?!"r9`%Q%i#3(B(a)$B!"#3(B(c)$B$K$D$$$F$O%Q%M%kG'Dj$,$J$5$l$F$*$i$:!"#E#C$br9`%Q%i#3(B(a)$B$r%Q%i#2(B(a)$BCm#3$NJ8L.$H$7$F1gMQ$7$F$$$k$N$_$J$N$G!">e5i0Q0w2q$OKcLt4XO"FCJL@)EY$Nr9`%Q%i#3(B(a)$B!"#3(B(c)$B@09g@-$K$D$$$F$O8!F$$7$J$$(B(130)$B!#(B

$B!!>e5i0Q0w2q$Or9`%Q%i#2(B(a)$BCm#3$N!VL5:9JL$N!W$O$9$Y$F$NES>e9q$KF10l$N4X@GFC7C$rM?$($k$3$H$r5AL3IU$1$k$b$N$G$O$J$$$H=R$Y!"$3$NE@$K4X$9$k%Q%M%kG'Dj$rGK4~$7$?!#-!r9`%Q%i#2(B(a)$B$N%U%i%s%98l5Z$S%9%Z%$%s8l$NJ88@$+$i$bL@$i$+$J$h$&$K!"r9`%Q%i#2(B(a)$B5Z$SCm#3$O!"FC7C4X@GBT6x$O#1#9#7#1G/%&%'%$%P!<7hDjA0J8$K!VDj$a$i$l$F$$$k!W#G#S#P!V$K=>$C$F!WM?$($i$l$J$1$l$P$J$i$J$$$H5,Dj$7$F$*$j(B(preferential treatment must be $B!H(Bin accordance$B!I(B with the GSP $B!H(Bas described$B!I(B in the Preamble to the 1971 Waiver Decision)$B!"Cm#3$OFC7C4X@GBT6xIUM?9q$KK!E*5AL3$r2]$9$b$N$G$O$J$$$H$$$&#E#C$N(143-147)$B!"-"Cm#3!VL5:9JL$N!W$NDL>o$N0UL#$+$i$O!"$3$NJ88@$,%$%s%I$N(any differential treatment of GSP beneficiaries would be prohibited)$B$N$+!"$"$k$$$O#E#C$Nu67$K$"$k9q$r:9JL$9$k$3$H$r6X;_$9$k$N$_$G0[$J$k>u67$K$"$k9q$r:9JL$9$k$3$H$OG'$a$F$$$k(B(differential treatment of GSP beneficiaries would not be prohibited per se.  Rather, distinctions would be impermissible only where the basis for such distinctions was improper)$B$N$+L@3N$G$O$J$$$,!"%$%s%I$b#E#C$bF1MM$N>u67$K$"$kES>e9q$r:9JL$9$k#G#S#P$OG'$a$i$l$J$$(B(similarly-situated GSP beneficiaries should not be treated differently)$B$H$$$&E@$K$D$$$F$O0lCW$7$F$$$k(B(151-154)$B!"-#Cm#3!VL5:9JL$N!W$NJ8L.$H$7$F!"Cm#3$N!V0lHLE*$J(B(generalized)$B!W$H$$$&J88@$r8!F$$9$k!"%Q%M%k$O!V0lHLE*$J!W$H$$$&J88@$O!V$9$Y$F$N!WES>e9q$K!VF10l$N(B(identical)$B!W4X@GFC7C$rM?$($k$3$H$r5AL3IU$1$?$b$N$H2r(the term $B!H(Bgeneralized$B!I(B requires that the GSP schemes of preference-granting countries remains generally applicable)$B$b$N$H2r$9$k$Y$-$G$"$k(B(155-156)$B!"-$$^$?!"Cm#3!VL5:9JL$N!W$NJL$NJ8L.$H$7$F!"r9`%Q%i#3(B(c)$B$O!"#G#S#PBN@)$K4p$E$-FC7CBT6x$rIUM?$9$k@h?J9q$KBP$7!"!V3+H/ES>e9q$N!DI,MW(B(needs of developing countries)$B!W$K!V@Q6KE*$K1~$:$k(B(respond positively)$B!W$3$H$r5AL3IU$1$F$*$j!"%Q%M%k$O(B$B$3$l$rES>e9q(B$BA4BN$N(B$B!VI,MW!W(B($B!H(Bneeds$B!I(B of developing countries collectively)$B$K1~$:$k5AL3$H2r$7$?$,!"%Q%i#3(B(c)$B$K$O!V(B$B8D!9$N(B$B!WES>e9q$NI,MW(B(needs of $B!H(Bindividual$B!I(B developing countries)$B$K1~$:$k$3$H$rGS=|$9$kJ88@$O$J$/!"r9`%Q%i#7$d#W#T#O@_N)6(DjA0J8$Ne9q$=$l$>$l$N>u67$K1~$8$F0[$J$kFC7C$rM?$($k$3$H$bG'$a$i$l$F$$$k$H2r$9$Y$-$G$"$k(B(157-162)$B!"-%$H$O$$$(ES>e9q$N$$$+$J$kI,MW$KBP$7$F$$$+$J$kBP1~$b$G$-$k$H$$$&$o$1$G$O$J$/!"!V3+H/>e!";q6b>e5Z$SKG0W>e$NI,MW!W$O(B$B5R4QE*$J(B$B4p=`$K4p$E$-I>2A$5$l$J$1$l$P$J$i$:(B(a $B!H(Bdevelopment, financial [or] trade need$B!I(B must be assessed according to an objective standard)$B!"$^$?%Q%i#2$K4p$E$-M?$($i$l$kFC7CBT6x$H$3$l$K$h$C$F!V3+H/>e!";q6b>e5Z$SKG0W>e$NI,MW!W$,2r>C$9$k2DG=@-$H$N4V$K==(B$BJ,$J4X78$,$J$1$l$P$J$i$J$$(B(a sufficient nexus should exist between, on the one hand, the preferential treatment provided under the respective measure authorized by paragraph 2, and, on the other hand, the likelihood of alleviating the relevant $B!H(B development, financial [or] trade need$B!I(B)$B!"0J>e$rF'$^$($k$H!"$"$k#G#S#P$K$h$C$F!V$9$Y$F$N!W(a GSP scheme may be $B!H(Bnon-discriminatory$B!I(B even if $B!H(Bidentical$B!I(B tariff treatment is not accorded to $B!H(Ball$B!I(B GSP beneficiaries)$B$7!"$^$?FCDj$N!V3+H/>e!";q6b>e5Z$SKG0W>e$NI,MW!W$KEz$($k$?$a$K!"$=$N$h$&$J!VI,MW!W$N$"$k$9$Y$F$NES>e9q$KM?$($i$l$k4X@GFC7C$b!VL5:9JL!W$H$J$j$&$k(B(tariff preferences under GSP schemes may be $B!H(Bnon-discriminatory$B!I(B when the relevant tariff preferences are addressed to a particular $B!H(Bdevelopment, financial [or] trade need$B!I(B and are made available to all beneficiaries that share that need)(163-165)$B!"-&%$%s%I$OES>e9q$Or9`$K$h$C$F#1#9#9#4G/$N#G#A#T#T#1!%#1>r$K4p$E$/8"Mx$rJ|4~$7$?$o$1$G$O$J$$$Hr9`$K4p$E$/#G#S#P$Nr$r1gMQ$9$k$3$H$O$G$-$J$$(B(166)$B!"-'#W#T#O@_N)6(Dj$NA0J8$K5,Dj$5$l$kH$i$7$F$b!"ES>e9q$N6&DL$NMx1W$N$_$J$i$:0lIt$NES>e9q$NMx1W$N$?$a$KFC7C@)EY$rMQ$$$k$3$H$O2DG=$G$"$j!"$"$kES>e9q$NFCDj$NI,MW$K1~$($k$?$a$KDI2CE*$JFC7C$rM?$($k$3$H$OG'$a$i$l$k$H2r$5$l$k(B(168-169)$B!"-(%Q%M%k$Or9`%Q%i#2(B(d)$B$r%Q%i#2(B(a)$B$N!VNc30!W$H$_$J$7!"%Q%i#2(B(d)$B$r:,5r$K%Q%i#2(B(a)$B$O!V87L)$KF10l$NBT6x(B(formally identical treatment)$B!W$r5a$a$F$$$k$H=R$Y$?$,!"%Q%i#2(B(d)$B$O%Q%i#2(B(a)$B$H$O0[$J$kFHN)$7$?8z2L(B(an effect that is different and independent)$B$rM-$7$F$*$j$3$l$r:,5r$K%Q%i#2(B(a)$B$,!VF10l$N!W4X@GFC7C$r5AL3IU$1$F$$$k$H2r$9$k$3$H$O=PMh$J$$(B(171-172)$B!#(B

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