Assignment on,

WTO Trade Dispute case from 266 to 277

Submitted to,
Dr. Fahmida Mostafiz
Assistant Professor
Department of International Business
University of Dhaka

Submitted by,
Kohinoor Akhter
ID: SK-030-054
Department of International Business
University of Dhaka

Submission date: 18th July, 2023

1. Dispute of European Communities — Export Subsidies on Sugar
1. Case ID and Name: DS266: European Communities — Export Subsidies on Sugar
2. Parties involved
2.1 Complainant: Brazil (Developing)
2.2 Respondent: European Communities (Developed)
2.3 Third Party: Australia; Barbados; Belize; Canada; China; Colombia; Cuba; Fiji;
Guyana; India; Jamaica; Kenya; Madagascar; Malawi; Mauritius; New Zealand; Paraguay; Saint
Kitts and Nevis; Eswatini; Tanzania; Thailand; Trinidad and Tobago; United States; Côte d’Ivoire
3. Time of Dispute: 27 September 2002
4. Products/ services
4.1 Product type: Agricultural and Food
4.2 Present the product/service export market size for the particular countries; who
import product and who export the product
Answer: The European Union is the largest producer of beet sugar in the world and the primary importer
of unrefined cane sugar. Almost every area of the global sugar market is currently dominated by Brazil.
It is the fifth-biggest consumer of sugar cane in the world and the world's largest producer and exporter
of sugar cane (Schmitz et al., 2002). So, we can say EC had a large market in Brazil.

4.3 Does the product/service have competitive advantage for the exporting country?
Answer: Yes. As EC is the largest producer of beet sugar in the world.
5. Which WTO rules/agreement violated? Disputes by agreement
5.1 Reasons to involve in trade disputes: Subsidies and Countervailing Measures
5.2 What rules violated: Brazil argued that the EC is acting inconsistently with at least
the requirements of: 1. Articles 3.3, 8, 9.1(a) and (c), and 10.1 of the Agreement on
Agriculture; 2. Articles 3.1(a) and 3.2 of the SCM Agreement; and 3. Articles III:4
and XVI of GATT 1994 by providing export subsidies for sugar in excess of its
reduction commitment levels.
6. Status of the Dispute
6.1 Consultations Requested: 27 September 2002.
6.2 Current Status: Dispute settled.
6.3 Solution of the Dispute: Solved.
6.4 Does the dispute still continue? : No.
7. Did the political party change of both complainant and respondent countries in that year or any major
policy change?
Answer: EC’s political party changed in 2004 and after years of domination by centrist and right-wing
parties in Brazil, a major shift in power occurred when the left-wing PT won the election in 2002.
8. Summary of the Panel findings:
Brazil:
Australia and Brazil requested the European Communities for discussions on September 27, 2002, about
the export subsidies the EC offered for the sugar industry as part of its Common Organization of the
Market. Brazil argued that the EC's sugar export subsidies were inconsistent with its obligations under
the WTO agreements. Brazil contended that these subsidies distorted international trade by artificially
lowering the price of European sugar on the global market, thereby harming Brazilian sugar producers.
Brazil claimed that the subsidies provided an unfair advantage to European sugar exporters, leading to
reduced market access for Brazilian sugar and causing significant economic losses.

Brazil maintained that the EC's sugar export subsidies violated various provisions of the WTO
agreements, including: 1. Articles 3.3, 8, 9.1(a) and (c), and 10.1 of the Agreement on Agriculture; 2.
Articles 3.1(a) and 3.2 of the SCM Agreement; and 3. Articles III:4 and XVI of GATT 1994. Brazil
emphasized the importance of fair competition and non-discrimination in international trade and sought
the elimination or reduction of the EC's sugar export subsidies to level the playing field for Brazilian
sugar producers.

European Communities:
The EC defended its sugar export subsidies, arguing that they were necessary to support its domestic
sugar industry and ensure its competitiveness in the global market. The EC maintained that the sugar
export subsidies were justified under the "green box" category of subsidies, which are considered
minimally trade-distorting and permissible under WTO rules. The EC asserted that the subsidies were
aimed at achieving legitimate policy objectives, such as rural development and income support for
farmers, without causing undue harm to other WTO members.

The EC disputed Brazil's claims that the subsidies unfairly impacted Brazilian sugar producers, asserting
that market conditions and other factors also influenced the competitiveness of Brazilian sugar exports.
The EC argued that eliminating or reducing the subsidies would undermine its agricultural policies and
negatively affect its sugar industry.

2. Dispute of United States — Subsidies on Upland Cotton

1. Case ID and Name: DS267: United States — Subsidies on Upland Cotton
2. Parties involved
2.1 Complainant: Brazil (Developing)
2.2 Respondent: United States (Developed)
Third Party: Argentina; Australia; Benin; Canada; Chad; China; Chinese Taipei; European Communities;
India; New Zealand; Pakistan; Paraguay; Venezuela, Bolivarian Republic of; Japan; Thailand
3. Time of Dispute: 27 September 2002
4. Products/ services
4.1 Product type: Cotton
4.2 Present the product/service export market size for the particular countries; who
import product and who export the product

Answer: With over 35% of all cotton exports in recent years, the United States is the largest cotton
exporter in the world. Brazil is now the world's second-largest exporter, nevertheless. Brazil is a
significant U.S. rival in the Asian and European cotton markets. So, in this case both the country is
competitor in cotton export to the world.

4.3 Does the product/service have competitive advantage for the exporting country?

Answer: Yes. In terms of cotton export, both nations occupy top spots, with the United States in the lead
and Brazil in second.
5. Which WTO rules/agreement violated? Disputes by agreement.
5.1 Reasons to involve in trade disputes: Subsidies and Countervailing Measures.
5.2 What rules violated: Brazil contended that these measures were inconsistent with
the obligations of the United States under the following provisions: Articles 5(c), 5.3 (b),
(c) and (d), 3.1(a) (including item (j) of the Illustrative List of Export Subsidies in Annex
I), 3.1(b), and 3.2 of the SCM Agreement; Articles 3.3, 7.1, 8, 9.1 and 10.1 of the
Agreement on Agriculture; and Article III:4 of GATT 1994.
6. Status of the Dispute
6.1 Consultations Requested: 27 September 2002.
 6.2 Current Status: Dispute settled between the two members.
6.3 Solution of the Dispute: Solved.
6.4 Does the dispute still continue? : No.
7. Did the political party change of both complainant and respondent countries in that year or any major
policy change?
Answer: US’s political party changed in 2009 and Barack Obama elected as the 44th president of US and
after years of domination by centrist and right-wing parties in Brazil, a major shift in power occurred
when the left-wing PT won the election in 2002.
8. Summary of the Panel findings:
Brazil:
On September 27, 2002, Brazil requested consultations with the United States regarding the prohibition
of export subsidies, grants, and other forms of assistance to US upland cotton producers, users, and
exporters, as well as legislation, regulations, statutory instruments, and amendments thereto. From
Brazil's perspective, the dispute with the United States over upland cotton export subsidies was centered
on the violation of WTO rules and the negative impact on its own cotton industry. Brazil argued that the
U.S. subsidies created an unfair advantage for American cotton exporters, leading to a decline in global
cotton prices and harming Brazilian cotton producers who could not compete on equal terms. It
contended that the United States' subsidies violated Articles 5(c), 6.3(b), (c) and (d), 3.1(a) (including
item (j) of the Illustrative List of Export Subsidies in Annex I), 3.1(b), and 3.2 of the SCM Agreement;
Articles 3.3, 7.1, 8, 9.1 and 10.1 of the Agreement on Agriculture; and Article III:4 of GATT 1994. Brazil
further claimed that the United States had failed to fully comply with previous WTO rulings, which
required the elimination or reduction of its export subsidies, necessitating further action to address the
ongoing violations.

United States:
The U.S. argued that its subsidies were necessary to support its cotton farmers and ensure a stable supply
of cotton for both domestic consumption and export. It contended that these subsidies complied with
World Trade Organization (WTO) rules, as it had made efforts to bring its subsidy programs in line with
international trade agreements. The United States also claimed that Brazil's allegations of market
distortion caused by its subsidies were exaggerated and did not accurately reflect the overall impact on
global cotton trade.

3. Disputes of United States — Sunset Reviews of Anti-Dumping

Measures on Oil Country Tubular Goods from Argentina
1. Case ID and Name: DS268: United States — Sunset Reviews of Anti-Dumping Measures on Oil
Country Tubular Goods from Argentina
2. Parties involved
2.1 Complainant: Argentina (Developing)
2.2 Respondent: United States (Developed)
Third Party: China; European Communities; Japan; Korea, Republic of; Mexico; Chinese Taipei
3. Time of Dispute: 7 October 2002
4. Products/ services
4.1 Product type: Oil country tubular goods (OCTG)
4.2 Present the product/service export market size for the particular countries; who
import product and who export the product
Answer: United States is a large market for Argentina for OCTG products export. Here the US is the
importer and Argentina is the exporter. Argentina has competitive advantage in OCTG goods
manufacturing and export in USA.

4.3 Does the product/service have competitive advantage for the exporting country?

Answer: Yes. In terms of OCTG products manufacturing, Argentina has comparative advantage.
5. Which WTO rules/agreement violated? Disputes by agreement
5.1 Reasons to involve in trade disputes: Anti-Dumping Measures
5.2 What rules violated: Articles 1, 2, 3, 5, 6, 11, and 18 of the Anti-Dumping Agreement
(ADA), Articles VI and X of the General Agreement on Tariffs and Trade (GATT) 1994,
and Article XVI:4 of the WTO Agreement were all considered to be in conflict by
Argentina with general US laws, regulations, policies, and procedures relating to the
administration of sunset reviews and the application of anti-dumping measures.
Argentina further alleged that the DOC's sunset review was in conflict with ADA
Articles 2, 5, 5.8, 11.3, 11.4, 12.1, and 12.3. It further asserted that Articles 3 and 11.3
of the ADA were broken by the ITC's sunset review.
6. Status of the Dispute
6.1 Consultations Requested: 7 October 2002
6.2 Current Status: In consultations.
6.3 Solution of the Dispute: Not yes.
6.4 Does the dispute still continue? : Yes.
7. Did the political party change of both complainant and respondent countries in that year or any major
policy change?
Answer: US’s political party changed in 2009.
8. Summary of the Panel findings:
Argentina:
Argentina's position in the conflict centers on questioning the legality and fairness of the American anti-
dumping regulations. Argentina alleged that the United States did not carry out proper sunset reviews,
which are recurrent evaluations of the necessity of anti-dumping measures. Argentina claimed that by
failing to carry out these evaluations in a timely manner, the U.S. violated its commitments under the
WTO Agreement on Anti-Dumping. Argentina argued that, in accordance with WTO regulations, the
U.S. should have discontinued the anti-dumping duties after the initial five-year period. Argentina
expressed dissatisfaction with how the US calculated the dumping margins. It claimed that some costs
and expenses incurred by Argentine producers were improperly taken into account by U.S. authorities,
resulting in an inflated dumping margin. Argentina argued that the excessive anti-dumping charges levied
on its shipments of OCTG were the result of this defective technique.

United States:
From the United States' perspective, the dispute centers on concerns about unfair trade practices and the
need to protect domestic industries. The U.S. Department of Commerce had imposed anti-dumping duties
on OCTG imports from Argentina in 2000, alleging that Argentine producers were selling their products
in the U.S. market at unfairly low prices, which harmed American manufacturers. The U.S. argued that
these measures were necessary to level the playing field and prevent further injury to its domestic
industry.
4. Disputes of European Communities — Customs Classification of
Frozen Boneless Chicken Cuts
1. Case ID and Name: DS269: European Communities — Customs Classification of Frozen Boneless
Chicken Cuts
2. Parties involved
2.1 Complainant: Brazil (Developing)
2.2 Respondent: European Communities (Developed)
Third Party: China; Thailand; United States
3. Time of Dispute: 11 October 2002
4. Products/ services
4.1 Product type: Agriculture and Food
4.2 Present the product/service export market size for the particular countries; who
import product and who export the product

Answer: Brazil has competitive advantage in producing and exporting frozen chicken. Market size is
quite large.

4.3 Does the product/service have competitive advantage for the exporting country?

Answer: Yes. In terms of Frozen Boneless Chicken Cuts, Brazil has comparative advantage.
5. Which WTO rules/agreement violated? Disputes by agreement
5.1 Reasons to involve in trade disputes: GAAT 1994 (National Treatment, Nullification
or Impairment, and Modification of Schedules)
5.2 What rules violated: Brazil believed that EC's action violated the EC's
responsibilities under Articles II and XXVIII of the GATT 1994 by providing its
commerce with less favorable treatment than that specified in the EC Schedules.
Additionally, Brazil argued that the EC's implementation of this action nullifies and
impairs, in accordance with Article XXIII:1, any benefits that Brazil may have directly
or indirectly derived under the GATT of 1994.
6. Status of the Dispute
6.1 Consultations Requested: 11 October 2002
6.2 Current Status: Implementation notified by respondent.
6.3 Solution of the Dispute: Yes.
6.4 Does the dispute still continue? : No.
7. Did the political party change of both complainant and respondent countries in that year or any major
policy change?
Answer: EC’s political party changed in 2004 and after years of domination by centrist and right-wing
parties in Brazil, a major shift in power occurred when the left-wing PT won the election in 2002.
8. Summary of the Panel findings:
Brazil:
From Brazil's perspective, the dispute revolves around EC Commission Regulation No. 1223/2002,
which introduced a new description of frozen boneless chicken cuts under the EC Combined
Nomenclature (CN) code 0207.14.10. Brazil argues that this new description includes a salt content that
was not previously considered and subjects imported products to a higher tariff than that applied to salted
meat (CN code 0210) in the EC's Schedules under the General Agreement on Tariffs and Trade (GATT)
1994.

Brazil claims that the regulation automatically reclassifies products that were previously imported under
a different CN code and subject to a lower ad valorem tariff rate. The new classification increases the
tariff rate substantially, which exceeds the rate applicable to salted meat. According to Brazil, this
treatment is discriminatory and violates the obligations of the EC under Articles II and XXVIII of the
GATT 1994. They argue that the measure nullifies and impairs benefits accruing to Brazil under the
GATT 1994.

European Communities:
From the European Community's perspective, the purpose of EC Commission Regulation No. 1223/2002
was to provide a more accurate and specific description of frozen boneless chicken cuts, including
considerations such as salt content. The EC maintains that the regulation was enacted within its rights
and obligations under the GATT 1994 and does not contravene any provisions. The EC argued that the
reclassification of the products is a legitimate means of ensuring proper categorization and tariff
application. They contended that the new classification corresponds more accurately to the nature and
characteristics of the imported products, justifying the higher tariff rate. The EC asserted that they have
complied with their obligations and that Brazil's claims of discriminatory treatment and nullification of
benefits are unfounded.

5. Disputes of Australia — Certain Measures Affecting the Importation of

Fresh Fruit and Vegetables
1. Case ID and Name: DS270: Australia — Certain Measures Affecting the Importation of Fresh Fruit
and Vegetables
2. Parties involved
2.1 Complainant: Philippines (Developing)
2.2 Respondent: Australia (Developed)
Third Party: Chile; China; European Communities; Ecuador; India; Thailand; United States
3. Time of Dispute: 18 October 2002
4. Products/ services
4.1 Product type: Agriculture and Food
4.2 Present the product/service export market size for the particular countries; who
import product and who export the product

Answer: Philippine has second position on global banana export ranking. So, they have competitive
advantage in banana export and the market size is quite large.

4.3 Does the product/service have competitive advantage for the exporting country?

Answer: Yes.
5. Which WTO rules/agreement violated? Disputes by agreement
5.1 Reasons to involve in trade disputes: The SPS Agreement and the Agreement on
Import Licensing.
5.2 What rules violated: Art. XI, XI:1, XIII GATT 1994; Art. 1, 3, 3.2, 3.5 Import
Licensing; Art. 2, 2.2, 2.3, 3, 3.1, 4, 5, 5.1, 5.2, 5.3, 5.5, 5.6, 6, 6.1, 6.2, 10 Sanitary
and Phytosanitary Measures (SPS)
6. Status of the Dispute
6.1 Consultations Requested: 18 October 2002
6.2 Current Status: Panel established.
6.3 Solution of the Dispute: Not yet.
6.4 Does the dispute still continue? : Yes.
7. Did the political party change of both complainant and respondent countries in that year or any major
policy change?
Answer: No major policy changes in the both countries in 2002. And no political party changes.
8. Summary of the Panel findings:
Philippine:
The dispute centers around Australia's stringent quarantine requirements for imported bananas. The
Philippines is a major exporter of bananas and has been seeking to gain greater market access to countries
such as Australia. However, Australia's strict biosecurity measures, particularly concerning the risk of
pests like the banana freckle disease, have limited Philippine exports. The Philippines argues that its
bananas undergo rigorous inspections and treatments, ensuring they meet international standards. They
believe that Australia's restrictions are unfair and not supported by scientific evidence, putting
unnecessary barriers on their exports.

European Communities:
Australia defends its strict quarantine measures as necessary to protect its agricultural industry from
potential pests and diseases. Australia is known for having a unique ecosystem and takes a precautionary
approach to safeguarding it. They argue that the introduction of pests like the banana freckle disease
could pose a significant threat to their banana industry and wider agricultural sector. Australia contends
that it has conducted scientific evaluations of the risks associated with Philippine banana imports and
implemented appropriate measures to mitigate them. They maintain that their regulations are justified to
ensure the long-term sustainability of local agriculture.