II.2 LEGAL MAXIMS: SUMMARIES AND EXTRACTS FROM SELECTED CASE LAW

European Union—Anti-Dumping Measures on Biodiesel from Indonesia (WT/DS480/R), Panel Report circulated on 25 January 2018, adopted on 28 February 2018 Russia—Anti-Dumping Duties on Light Commercial Vehicles from Germany and Italy (WT/DS479/AB/R), Appellate Body Report circulated on 22 March 2018, adopted on 9 April 2018 European Communities and Certain Member States—Measures Affecting Trade in Large Civil Aircraft. Recourse to Article 21.5 of the DSU by the United States (WT/DS487/AB/RW)...

U.S. Refusal to Appoint Members Renders WTO Appellate Body Unable to Hear New Appeals

Over the last few years, the United States has been pressuring the World Trade Organization (WTO) to reform the Appellate Body by refusing proposals to fill vacancies. On December 10, 2019, the terms of two Appellate Body members expired, leaving one member left for the seven-member body. This has brought new appeals to a standstill, as an appeal from a panel established by the Dispute Settlement Body must be heard by three Appellate Body members. In February of 2020, the United States elaborated on its complaints about the Appellate Body in a report published by the Office of the United States Trade Representative. In the spring of 2020, in response to the continued U.S. resistance to filling vacancies on the Appellate Body, a group of WTO members established an interim arrangement to handle appeals through arbitration. Also in the spring of 2020, the United States described as invalid a recent Appellate Body report regarding a dispute between Canada and the United States, asserting that none of the three persons who issued the report were in fact bona fide Appellate Body members.

Expired Measures, Excess Duty Drawbacks and Causation: The Appellate Body Report in EU–PET (Pakistan)

The Appellate Body report in EU–PET (Pakistan) raises distinct questions regarding the need for findings in relation to expired measures, the conditions under which duty drawback schemes may constitute subsidies and the causation methodology to apply under the SCM Agreement. We conclude that the report offers no clear guidance on whether the function and design of WTO dispute settlement require or preclude findings in case of expired measures. We welcome the Appellate Body's conclusion that, in case of duty drawback schemes, the financial contribution element of the subsidy is limited to the excess remission or drawback of import charges. Finally, although the Appellate Body rightly found that authorities are free to choose the methodology for the causation analysis provided that the analysis is complete and objective, the methodology used by the investigating authority in this case shows a number of deficiencies that were not recognized by the Appellate Body.

Russia—Measures Concerning Traffic in Transit

This dispute, brought by Ukraine against Russia, provides the first discussion in a World Trade Organization (WTO) Panel or Appellate Body Report of the security exception in Article XXI of the General Agreement on Tariffs and Trade 1994 (GATT). Unusually for a WTO dispute, the Panel (chaired by former WTO Appellate Body Member Georges Abi-Saab) found that Russia had not acted inconsistently with any of the claimed obligations under the GATT or Russia's Accession Protocol. Central to that conclusion was the Panel's understanding of the GATT security exception and the circumstances surrounding the imposition of the challenged measures, which related to trade in transit by road and rail through Russian territory. The Panel found that, since 2014, an emergency in international relations existed between Russia and Ukraine within the meaning of GATT Article XXI(b)(iii) and that the challenged measures fell within this exception. If the exception had not applied, according to the Panel, Ukraine would have established a prima facie case of violation of the provisions on freedom of transit in GATT Article V:2 and equivalent provisions in Russia's Accession Protocol. The decision, which neither party chose to appeal, has significant implications for other disputes in which the security exception has been invoked.

The "Necessity Test" as Expressed by the Enigmatic Article XX(j) of the General Agreement on Tariffs and Trade (1994): Appellate Body Report, India - Certain Measures Relating to Solar Cells and Solar Modules

The General Agreement on Tariffs and Trade (1994) (GATT) is premised on the elimination of all barriers to trade in goods. Contrary to this approach, Article XX of the GATT authorises the circumvention of this imperative. More specifically, Article XX(j) of the GATT essentially provides that GATT contracting parties are authorised to promulgate measures that are "essential" to the acquisition of products in general or local short supply. This invariably means that only measures that are "essential" will satisfy the "necessity test" contemplated under Article XX(j). The Appellate Body Report, India - Certain Measures Relating to Solar Cells and Solar Modules is the first World Trade Organisation case to elaborate on the "necessity test" of Article XX(j) of the GATT. This paper seeks to evaluate the Appellate Body's findings on the "necessity test" of Article XX(j).

Legal Maxims: Summaries and Extracts from Selected Case Law

Russian Federation—Measures on the Importation of Live Pigs, Pork and Other Pig Products from the European Union (WT/DS475/AB/RW), Appellate Body Report circulated on 23 February 2017, adopted on 21 March 2017 United States—Certain Methodologies and Their Application to Anti-Dumping Proceedings Involving China (WT/DS471/AB/R), Appellate Body Report circulated on 11 May 2017, adopted on 22 May 2017...

United States – Certain Methodologies and Their Application to Anti-Dumping Proceedings Involving China: Nails in the Coffin of Unfair Dumping Margin Calculation Methodologies

The WTO Appellate Body report United States – Certain Methodologies and Their Application to Anti-Dumping Proceedings Involving China is yet another in a long line of disputes involving US Department of Commerce's dumping margin calculation methodologies. The AB ruled against the United States on three important aspects: (1) the use of the Nails test to rationalize the exceptional method in Article 2.4.2 of the Anti-Dumping Agreement so as to justify using the weighted average-to-transaction methodology in dumping margin calculations; (2) the treatment of multiple companies in a non-market economy as a single NME-wide entity; and (3) the USDOC's policy of using adverse facts available for such an entity. Yet, some aspects of the AB's decision – most notably affirming the use of average prices – significantly weaken Article 2.4.2's pattern requirement and potentially open the door to greater use of the exceptional method.