Korea, US Reach Settle Washers Dispute

· DS546: United States — Safeguard measure on imports of large residential washers

· DS616: European Union — Countervailing and Anti-Dumping Duties on Stainless Steel Cold-Rolled Flat Products from Indonesia

· US Challenges Panel Ruling on grounds of Security Exception, “United States — Origin Marking Requirement”

· Security grounds challenged a state ought to defer consideration of its essential security interest until after a breakdown in relations.

· Appellate Body appointments

· Guatemala introduced for the 65th time the group's proposal to start the selection processes for filling vacancies on the Appellate Body.

· Surveillance of implementation

The Republic of Korea and the United States announced at a meeting of the Dispute Settlement Body (DSB) on 28 April that they have reached a mutually agreed solution to terminate subsequent procedures in “United States — Safeguard measure on imports of large residential washers” (DS546). WTO members considered a request from Indonesia for the establishment of a panel to examine EU countervailing and anti-dumping duties on stainless steel cold-rolled flat products from Indonesia. The EU said it was not in a position to accept Indonesia’s request.

DS546: United States — Safeguard measure on imports of large residential washers

Korea and the United States informed the DSB that they reached a mutually agreed solution with a view to terminating subsequent procedures in their dispute regarding a US safeguard measure on imports of large residential washers

Korea said that since the circulation of the report on this dispute, both parties have closely consulted with each other to achieve a prompt an effective settlement. Korea acknowledged that by terminating the safeguard measure at issue, the United States has brought its measure into conformity with relevant WTO agreements.

Considering that further dispute proceedings will not be pursued, both members announced they would deliver a joint statement expressing their willingness to reach a final conclusion of this dispute through the adoption of the panel report, followed by a mutually agreed solution to terminate subsequent proceedings.

The United States took the floor and said that while certain findings of the panel in this dispute were disappointing and unbalanced, it decided to allow the report to be adopted. The US said it took this step in light of all the circumstances in this dispute, including its desire to work with Korea to resolve this dispute through mutually agreed solutions.

The DSB then adopted the panel report in DS546. The chair of the DSB, Ambassador Petter Ølberg of Norway, said the adoption procedure is without prejudice to the rights of members to express their views on the panel report.

DS616: European Union — Countervailing and Anti-Dumping Duties on Stainless Steel Cold-Rolled Flat Products from Indonesia

Indonesia submitted its first request for a WTO dispute panel to review countervailing and anti-dumping measures imposed by the European Union on imports of stainless-steel cold-rolled flat products from Indonesia. Consultations between the EU and Indonesia took place on 13 March 2023 but failed to resolve the dispute, Indonesia said.

The European Union stated that the measures at stake are fully justified and rejected the establishment of a panel. The EU said it was ready to discuss with Indonesia reciprocal interim arrangements that would preserve the availability of a peer review in this and other disputes on the basis of Article 25 of the Dispute Settlement Understanding (DSU) as long as the Appellate Body is not functioning, such as through the Multi-party interim appeal arrangement (MPIA).

The DSB took note of the statements and agreed to revert to the matter should a requesting member wish to do so.

Statement by the United States on DS597, “United States — Origin Marking Requirement”

The United States said the challenged measures in this dispute were based on well-grounded determinations implicating US essential security interests relating to democracy and human rights. The US reiterated that recent political and human rights developments in Hong Kong, China confirmed that the conditions that warranted the US imposition of the challenged measures continue to exist.

The United States said it fundamentally disagreed with the panel's approach, which suggests a state ought to defer consideration of its essential security interest until after a breakdown in relations. According to the US, a WTO member cannot be expected to wait until it is too late to act or be required to sever relations as a prerequisite for other action it considers necessary.

The United States said the WTO does not have the competence or the authority to either assess the foreign affairs relationships of a member or to pass judgment on the value that the US and some other members place on freedom and human rights and the actions they take in seeking to secure those values. Members need to address this issue to prevent undermining the WTO and clarify and adopt a shared understanding of the central security exception, the US said.

Hong Kong, China said it had serious doubts whether it serves the interests of the dispute settlement system for a party to a dispute to keep coming back to DSB meetings to repeat its arguments. It does not make any sense especially when the US has also launched an appeal against the panel ruling. The DSB is not the right forum to discuss members' internal affairs, Hong Kong, China said, adding it was disappointed with the US for presenting yet again a biased and untrue description of the current state of affairs in the territory.

Hong Kong, China called on the United States to accept the ruling and to bring its WTO-inconsistent measure into conformity with its obligations. Given that the United States has resorted to an appeal in this case when the Appellate Body has been single-handedly wrecked by the US, one cannot help but question whether the purpose of the US lodging an appeal is to stall its obligations to implement the panel ruling, Hong Kong, China added.

China expressed disappointment at seeing this item on the DSB agenda again, particularly with the background of the ongoing WTO reform process in which the vast majority of members — including the US — are calling for enhancing the efficiency of WTO meetings and to make discussions more focused and meaningful. China said the WTO, including its dispute settlement mechanism, is a forum to discuss trade issues and resolve trade disputes, rather than a place to engage in the discussion of political issues.

China welcomed the panel's findings and said member should refrain from taking unilateral and protectionist measures in the name of national security or using it as a vehicle to disregard the core principle of the WTO or to interfere with other members' internal affairs.

The Russian Federation said the mandate of the WTO is to provide a common institutional framework for the conduct of trade relations among its members. This mandate precludes the membership from diving into the political discussions that are being reopened by the US, the Russian delegate said.

Appellate Body Appointments

Guatemala introduced for the 65th time 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 over the current situation in the Appellate Body which is seriously affecting the overall WTO dispute settlement system against the best interest of members, Guatemala said for the group.

The number of members supporting the proposal increased to 128, following Brunei Darussalam's decision to join as a co-sponsor.

Twenty-nine delegations took the floor in support of the proposal, some speaking on behalf of groups. They reiterated the importance of the WTO's two-tiered dispute settlement system to the stability and predictability of the multilateral trading system and the need to resolve the deadlock.

A number of delegations that took the floor noted the commitment made by ministers at the WTO's 12th Ministerial Conference (MC12) to engage in discussions aimed at securing a fully functioning dispute settlement system by 2024. They pledged their support for securing an outcome within the prescribed time period.

The United States repeated that it does not support the proposed decision to commence the appointment of Appellate Body members as its longstanding concerns with WTO dispute settlement remain unaddressed. Fundamental reform is needed to ensure a well-functioning WTO dispute settlement system, which supports WTO members in the resolution of their disputes in an efficient and transparent manner, and in doing so limits the needless complexity and interpretive overreach that has characterized dispute settlement in recent years, the US said.

The chair of the DSB reminded members of the MC12 commitment to hold discussions with the view to having a fully and well-functioning dispute settlement system accessible to all members by 2024. He referred to the ongoing discussions on this matter at the technical level and to the report provided at the last DSB meeting by the representative of Guatemala, in his personal capacity and under his own responsibility, informing members of the progress made on this issue for transparency purposes.

The chair also noted that this issue was addressed at the last Trade Negotiations Committee meeting held on 19 April and expressed hope that, collectively, members will be able to find the solution to this matter.

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.”