Dispute panels established to review EU measures on imports of South African citrus fruit

DS613: European Union — Measures Concerning the Importation of Citrus Fruit from South Africa

DS624: European Union — Additional Measures Concerning the Importation of Citrus Fruit from South Africa

South Africa submitted its second requests for two panels in disputes it initiated concerning European Union regulations governing the importation of citrus fruits which impact imports from South Africa. The measures in question concern import restrictions imposed by the EU to control spread of the insect Thaumatotibia leucotreta, or False Codling Moth, and the fungus P. citricarpa, known as “citrus black spot.” The EU said it was not ready to accept South Africa's first requests at a DSB meeting on 24 July.

South Africa reiterated that it has many serious concerns regarding the WTO consistency of these EU measures, which have had a severe impact on South African citrus food exports. Moreover, they appear to be adopted in response to political pressure from the EU's citrus fruit industry, South Africa said. While South Africa does not take this decision lightly, as it has not been a frequent user of the WTO dispute settlement mechanism and the EU is an important trading partner, it also needs to ensure that its rights are properly secured.  South Africa added that it would be requesting that the same three individuals serve on the two panels.

The European Union said it regretted South Africa's decision to pursue panel proceedings in the two cases but reiterated its belief that its pest control measures are entirely justified and that it was confident it would succeed in these disputes.

The DSB agreed to the establishment of the two panels.

For DS613, Canada, the United States, the United Kingdom, Japan, Israel, India, Colombia, China, Eswatini, Brazil and Paraguay reserved their third party rights to participate in the panel proceedings. For DS624, Australia, Brazil, Canada, China, Colombia, Eswatini, India, Israel, Japan, Paraguay, the United States and Argentina reserved their third party rights to participate in the panel proceedings.

DS623: United States — Certain Tax Credits Under the Inflation Reduction Act

China submitted its first request for the establishment of a dispute panel to rule on certain subsidy measures adopted by the United States under the US Inflation Reduction Act (IRA) which China says are contingent upon the use of domestic over imported goods or that otherwise discriminate against goods of Chinese origin.  Full details on China's request are available here.

China said consultations held on 7 May with the US failed to resolve the dispute, thus prompting China's request for a panel. China said the IRA is probably the single largest subsidy measure ever enacted, with official estimates of the current climate-related provisions of the IRA placed at USD 393 billion while others have estimated the value of the subsidies will exceed USD 1 trillion. Many WTO members, including China, have already raised concerns on various occasions about this level of subsidization and its trade distorting effects.

While many of the IRA subsidy provisions are deeply problematic, China said its WTO challenge is limited to those subsidy provisions under the IRA that are clearly prohibited under WTO rules: those that are contingent upon the use of domestic over imported goods, or that otherwise discriminate against goods of Chinese origin. China said that while it recognizes that members have an interest in seeing their economies benefit from the clean energy transition, including the opportunity to produce clean energy products and technology, this is not a time to abandon the core principle of non-discrimination that is the bedrock of the multilateral trading system. Increased protectionism is not a solution to this climate crisis, it added.

The United States said it objected to China's request for a panel, which seeks to undermine US efforts to address the global climate crisis and build a more resilient clean energy supply chain. China's complaint is a regrettable attempt to prevent progress on these critical issues, to entrench reliance on China's non-market excess capacity, and to undermine the broader interests of all WTO members.

The United States said the IRA is a groundbreaking tool in the effort to address the global climate crisis and is the most significant action the US has taken on clean energy and climate change.  Existing WTO rules cannot be understood to prevent WTO members from taking action to address the most urgent global issues of our time, the US added. It is hypocritical for China to target the US measures in this dispute while failing to address its industrial targeting of clean energy sectors and its use of non-market policies and practices that are detrimental to all members. China's approach has created an untenable situation for governments seeking to meet their climate, resiliency and other legitimate policy objectives; for these reasons, the US said it does not agree to the establishment of the panel requested by China.

China expressed its disappointment with the US opposition to its request and said WTO rules have a valuable role to play in combatting climate change but that this could only be achieved if the rules are applied in a fair and non-discriminatory way.

The DSB took note of the statement and agreed to refer to this matter should a requesting member wish to do so.

DS588: India — Tariff Treatment on Certain Goods in the Information and Communications Technology Sector

India and Chinese Taipei once again requested additional time for the DSB to consider for adoption the panel rulings in the case initiated by Chinese Taipei regarding India's tariffs on certain high-tech goods. The parties asked that the DSB further delay consideration of the panel reports until 28 October 2024 in order to help facilitate resolution of the disputes. The DSB had agreed to four previous requests from India and Chinese Taipei to delay consideration of the reports.

The DSB agreed to the latest requests from Chinese Taipei and India.

Appellate Body appointments

Colombia, speaking on behalf of 130 members, introduced for the 78th 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 interest in the functioning of the Appellate Body and, more generally, in the functioning of the WTO's dispute settlement system, Colombia said.

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.

Twenty-six members then took the floor to comment. Many of these members referred to their previous statements made on this matter at earlier DSB meetings and underlined the urgent need to meet the mandates set out at the 12th and 13th Ministerial Conferences in 2022 and early 2024 respectively to conduct discussions with the view to having a fully and well-functioning dispute settlement system accessible to all members by 2024. Several welcomed the progress being made in the formal dispute settlement reform process now underway and the need to accelerate discussions after the WTO's summer break to achieve the 2024 goal.

Colombia said on behalf of the 130 members it regretted that for the 78th occasion members have not been able to launch the selection processes. Ongoing conversations about reform of the dispute settlement system should not prevent the Appellate Body from continuing to operate fully, and members should comply with their obligation under the DSU to fill the vacancies as they arise, Colombia said for the group.

The DSB chair, Ambassador Saqer Abdullah Almoqbel of Saudi Arabia, concluded by expressing his full support for the facilitator in the dispute settlement reform discussions, Ambassador Usha Dwarka-Canabady of Mauritius, in her efforts towards achieving a positive outcome within the mandated time frame.

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 meeting

The next regular DSB meeting will take place on 23 September.

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