Chile – Price Band System and Safeguard Measures Relating to Certain Agricultural Products (WT/DS207/AB/R, WT/DS207/R): Report of the Appellate Body

Summary

INTRODUCTION

Chile appeals certain issues of law and legal interpretations developed in the Panel Report, Chile –Price Band System and Safeguard Measures Relating to Certain Agricultural Products (the “Panel Report”).

The Panel was established on 12 March 2001 to consider a complaint by Argentina with respect to: (i) Chile's price band system for certain agricultural products; and (ii) Chile's provisional and definitive safeguard measures imposed on the same products. Before the Panel, Argentina claimed that Chile's price band system is inconsistent with Article II:1(b) of the General Agreement on Tariffs and Trade 1994 (the “GATT 1994”) and Article 4.2 of the Agreement on Agriculture. Argentina also claimed that the safeguard measures imposed by Chile constitute a violation of Article XIX:1(a) of the GATT 1994 and certain provisions of the Agreement on Safeguards.

In the Panel Report, circulated to Members of the World Trade Organization (the “WTO”) on 3 May 2002, the Panel found that Chile's price band system is inconsistent with Article 4.2 of the Agreement on Agriculture and Article II:1(b) of the GATT 1994. The Panel also found that Chile's safeguard measures on wheat, wheat flour and edible vegetable oils violated certain provisions of the Agreement on Safeguards and the GATT 1994.

The Panel concluded that, to the extent Chile had acted inconsistently with the provisions of the GATT 1994, the Agreement on Agriculture and the Agreement on Safeguards, it had nullified or impaired the benefits accruing to Argentina under those Agreements. The Panel recommended that the Dispute Settlement Body (the “DSB”) request Chile to bring its price band system into conformity with the Agreement on Agriculture and the GATT 1994. The Panel did not, however, make recommendations with respect to the safeguard measures challenged by Argentina.

On 24 June 2002, Chile notified the DSB of its intention to appeal certain issues of law covered in the Panel Report and certain legal interpretations developed by the Panel, pursuant to paragraph 4 of Article 16 of the Understanding on Rules and Procedures Governing the Settlement of Disputes (the “DSU”), and filed a Notice of Appeal pursuant to Rule 20 of the Working Procedures for Appellate Review (the “Working Procedures”). On 4 July 2002, Chile filed its appellant's submission.