VII - FINDINGS AND CONCLUSIONS IN THE APPELLATE BODY REPORT WT/DS396/AB/R

Summary

261. In the appeal of the Panel Report, Philippines — Taxes on Distilled Spirits (complaint by the European Union, WT/DS396/R) (the “EU Panel Report”), for the reasons set out in this Report, the Appellate Body:

(a) with respect to Article III:2, first sentence, of the GATT 1994:

(i) upholds the Panel's finding, in paragraph 7.85 of the EU Panel Report, that each type of imported distilled spirit at issue in this dispute—gin, brandy, vodka, whisky, and tequila—made from non-designated raw materials is “like” the same type of domestic distilled spirit made from designated raw materials, within the meaning of Article III:2, first sentence, of the GATT 1994;

(ii) finds that the Panel did not act inconsistently with Article 11 of the DSU in its evaluations of the products' physical characteristics, of the Philippine market for distilled spirits, and of tariff classification;

(iii) upholds, as a consequence, the Panel's finding, in paragraphs 7.90 and 8.2 of the EU Panel Report, that the Philippines has acted inconsistently with Article III:2, first sentence, of the GATT 1994 by imposing on each type of imported distilled spirit at issue in this dispute—gin, brandy, rum, vodka, whisky, and tequila—internal taxes in excess of those applied to “like” domestic distilled spirits of the same type made from designated raw materials; and

(iv) reverses the Panel's finding, in paragraph 7.77 of the EU Panel Report, to the extent that it stands for the proposition that all distilled spirits at issue in this dispute are “like products”, regardless of types, within the meaning of Article III:2, first sentence, of the GATT 1994;