WTO
Circulates Dispute Panel Reports regarding US Measures on Steel and Aluminium
Products
<Conclusions
And Recommendation>
On 9 December, the WTO circulated the panel
reports in the cases brought by China, Norway, Switzerland and Türkiye in “United
States — Certain Measures on Steel and Aluminium Products” (DS544, DS552, DS556
and DS564).
The summary below was up-to-date at 9 December 2022
Complaint by China
On 5 April
2018, China requested consultations with the United States concerning certain duties
that the United States had imposed on imports of steel and aluminium products.
China claimed
that the measures appear to be inconsistent with:
·
Articles 2.1, 2.2, 4.1, 4.2, 5.1,
7, 11.1(a), 12.1, 12.2 and 12.3 of the Agreement on Safeguards; and
·
Articles I:1, II:1(a) and (b), X:3(a),
XIX:1(a) and XIX:2 of the GATT 1994.
On 13 April
2018, the United States requested the Chair of the DSB to circulate to Members a
communication where it indicated that the United States was willing to enter into
consultations with China, without prejudice to the US view that China's letter of
4 April 2018 did not satisfy the requirements of Article 4 of the DSU.
On 17 April
2018, India requested to join the consultations. On 18 April 2018, the Russian Federation
and Thailand requested to join the consultations. On 19 April 2018, the European
Union and Hong Kong, China requested to join the consultations.
On 18 October
2018, China requested the establishment of a panel. At its meeting on 29 October
2018, the DSB deferred the establishment of a panel.
At its meeting on 21 November 2018, the DSB established a panel. Bahrain,
Brazil, Canada, Colombia, Egypt, the European Union, Guatemala, Hong Kong, China,
Iceland, India, Indonesia, Japan, Kazakhstan, Malaysia, Mexico, Norway, New Zealand,
Qatar, the Russian Federation, Saudi Arabia, Singapore, South Africa, Switzerland,
Chinese Taipei, Thailand, Turkey, Ukraine, the United Arab Emirates and Venezuela
reserved their third-party rights.
On 7 January 2019, China requested the Director-General to compose
the panel. On 25 January 2019, the Director-General composed the panel.
On 4 September 2019, the Chair of the panel informed the DSB that the
panel expected to issue its final report to the parties no earlier than autumn 2020.
The Chair also informed the DSB that the report would be available to the public
once it was circulated to the Members in all three official languages, and that
the date of circulation depends on completion of translation. On 4 February 2021,
the Chair of the panel informed the DSB that due to delays caused by the global
COVID-19 pandemic, the panel expected to issue its final report to the parties no
earlier than the second half of 2021. On 9 December 2021, the Chair of the panel
informed the DSB that due to the complexity of the dispute and the delays caused
by the global COVID-19 pandemic, the panel expected to issue its final report to
the parties no earlier than the first half of 2022. On 30 June 2022, the Chair of
the panel informed the DSB that due to the complexity of the dispute, the panel
now expected to issue its final report to the parties no earlier than the last quarter
of 2022.
On 9 December 2022, the panel report was circulated
to Members.
This dispute concerns duties and related
measures imposed by the United States on steel and aluminium imports under Section
232 of the Trade Expansion Act of 1962, as amended.
Claims under the GATT 1994
The Panel found that the duties on steel
and aluminium were inconsistent with Article II:1 of the GATT 1994 as they exceeded
the bound tariff rates in the United States' WTO Schedule of Concessions. The Panel
also found that exemptions from the duties granted to steel and aluminium products
from certain countries were inconsistent with the requirement of most-favoured-nation
treatment under Article I:1 of the GATT 1994.
Applicability of Article XIX of the GATT
1994 and the Agreement on Safeguards
The Panel addressed the applicability of
Article XIX of the GATT 1994 and the Agreement on Safeguards to the measures at
issue focusing on Article 11.1(c) of the Agreement on Safeguards, which provides
that the agreement “does not apply to measures sought, taken or maintained by a
Member pursuant to provisions of GATT 1994 other than Article XIX”. The Panel considered
that the terms “pursuant to” in this provision referred to measures sought, taken,
or maintained under the purview of another provision of the GATT 1994, without entailing
consistency with the specific requirements of such other provision. The Panel concluded
based on evidence of the design and application of the measures at issue that they
were sought, taken, or maintained pursuant to Article XXI of the GATT 1994 within
the meaning of Article 11.1(c) of the Agreement on Safeguards. The Panel therefore
found that the Agreement on Safeguards did not apply to the measures at issue.
Article XXI of the GATT 1994 (“Security
Exceptions”)
The United States invoked Article XXI(b)
of the GATT 1994 in relation to the measures at issue as “any action which it considers
necessary for the protection of its essential security interests”. The United States further argued that its measures
were “taken in time of war or other emergency in international relations” under
Article XXI(b)(iii). The Panel first addressed the parties' interpretive disagreement
on the extent to which the terms of Article XXI(b) of the GATT 1994 permit review
of a Member's invocation of that provision in proceedings under the DSU. The Panel
considered that it was required under the DSU to address the United States' invocation
of Article XXI(b) of the GATT 1994 in accordance with the terms of that provision
and within an objective assessment of the relevant measures and claims.
Based on its interpretation of Article XXI(b)
of the GATT 1994, the Panel assessed whether the measures found to be inconsistent
with certain provisions of the GATT 1994 were taken under the conditions and circumstances
described in subparagraph (iii) of Article XXI(b) providing that a Member may take
action which it considers necessary for the protection of its essential security
interests “in time of war or other emergency in international relations”. The Panel
considered that an “emergency in international relations” under Article XXI(b)(iii)
refers to situations of a certain gravity or severity and international tensions
that are of a critical or serious nature in terms of their impact on the conduct
of international relations.
Having considered the evidence and arguments
submitted in this dispute, the Panel did not find that the measures at issue were
“taken in time of war or other emergency in international relations” within the
meaning of Article XXI(b)(iii) of the GATT 1994. The Panel therefore found that
the inconsistencies of the measures at issue with certain provisions of the GATT
1994 were not justified under Article XXI(b)(iii) of the GATT 1994.