TWN Info Service on WTO and Trade Issues (June12/04)
15 June 2012
Third World Network

WTO affirms US "dolphin-safe" measures on tuna WTO-illegal
Published in SUNS #7372 dated 21 May 2012

Geneva, 16 May (Kanaga Raja) -- The Appellate Body of the World Trade Organisation (WTO) on Wednesday largely upheld an earlier panel ruling that had found that "dolphin-safe" measures taken by the United States concerning the importation, marketing and sale of tuna and tuna products from Mexico were inconsistent with US obligations under the WTO.

In its ruling issued on 16 May, the Appellate Body reversed the panel's finding that the US "dolphin-safe" labelling provisions are not inconsistent with Article 2.1 of the Technical Barriers to Trade (TBT) Agreement, and found instead that the US "dolphin-safe" labelling provisions are inconsistent with Article 2.1 of the TBT Agreement.

The Appellate Body reversed the panel's finding that the measure at issue is inconsistent with Article 2.2 of the TBT Agreement.

The Appellate Body recommended that the Dispute Settlement Body (DSB) request the United States to bring its measure, found in the panel report, as modified by the Appellate Body report, to be inconsistent with the TBT Agreement, into conformity with its obligations under that Agreement.

In a ruling issued on 15 September, the dispute panel had found that the US dolphin-safe provisions were inconsistent with Article 2.2 of the TBT Agreement because they were "more trade-restrictive than necessary to achieve a legitimate objective", but ruled that these provisions were not inconsistent with Articles 2.1 and 2.4 of the TBT Agreement.

The panel had also exercised judicial economy with respect to Mexico's claims under Articles I: 1 and III: 4 of the GATT 1994.

The panel had recommended that the DSB request the United States to bring its measures into conformity with its obligations under the TBT Agreement.

According to the panel report, in its dispute with the US, Mexico had identified the following measures adopted by the United States concerning the importation, marketing and sale of tuna and tuna products: (a) United States Code, Title 16, Section 1385 (Dolphin Protection Consumer Information Act); (b) Code of Federal Regulations, Title 50, Section 216.91 (Dolphin-safe labelling standards) and Section 216.92 (Dolphin-safe requirements for tuna harvested in the ETP [Eastern Tropical Pacific Ocean] by large purse seine vessels); and, ( c) The ruling in Earth Island Institute v. Hogarth, 494 F. 3d 757 (9th Cir. 2007).

The measures highlight the US "dolphin-safe" labelling scheme and sets the conditions for the use of the term "dolphin-safe" for tuna and tuna products.

According to the panel report, Mexico presented claims under Articles 2.1, 2.2 and 2.4 of the TBT Agreement. All three of these provisions relate to "technical regulations". The United States, however, considered that the measures at issue do not constitute "technical regulations" within the meaning of the TBT Agreement. (See SUNS #7220 dated 19 September 2011 for the panel ruling.)

In its ruling on 16 May, the Appellate Body found that the panel did not err in characterising the measure at issue as a "technical regulation" within the meaning of Annex 1.1 to the TBT Agreement.

It found that the panel erred in its interpretation and application of the phrase "treatment no less favourable" in Article 2.1 of the TBT Agreement, and reversed the panel's finding, in paragraphs 7.374 and 8.1(a) of the panel report, that the US "dolphin-safe" labelling provisions are not inconsistent with Article 2.1 of the TBT Agreement.

The Appellate Body found instead that the US "dolphin-safe" labelling provisions are inconsistent with Article 2.1 of the TBT Agreement.

The Appellate Body further found that the panel erred in concluding, in paragraphs 7.620 and 8.1(b) of the panel report, that it has been demonstrated that the measure at issue is more trade restrictive than necessary to fulfil the United States' legitimate objectives, taking account of the risks non-fulfilment would create.

It therefore reversed the panel's finding that the measure at issue is inconsistent with Article 2.2 of the TBT Agreement.

The Appellate Body rejected Mexico's claim that the panel erred in finding that the United States' objective of "contributing to the protection of dolphins, by ensuring that the US market is not used to encourage fishing fleets to catch tuna in a manner that adversely affects dolphins" is a legitimate objective within the meaning of Article 2.2 of the TBT Agreement.

It also rejected Mexico's request to find the measure at issue inconsistent with Article 2.2 of the TBT Agreement based on the panel's finding that the measure did not entirely fulfil its objectives.

The Appellate Body reversed the panel's finding, in paragraph 7.707 of the panel report, that the "AIDCP [Agreement on the International Dolphin Conservation Program] dolphin-safe definition and certification" constitute a "relevant international standard" within the meaning of Article 2.4 of the TBT Agreement.

In the light of this, said the Appellate Body, the panel's finding, in paragraph 8.1(c) of the panel report, that the measure at issue is not inconsistent with Article 2.4 of the TBT Agreement stands.

Finally, the Appellate Body found that the panel acted inconsistently with Article 11 of the Dispute Settlement Understanding in deciding to exercise judicial economy with respect to Mexico's claims under Articles I: 1 and III: 4 of the GATT 1994. +