Francisco Sánchez, the under secretary of commerce for international trade.

By Phillip Kurata
IIP Staff Writer,
Washington
February 3,  2012

The United States wants to shore up its trade and investment ties with its partners in the Western Hemisphere as part of a broader strategy to liberalize trade with the Asia-Pacific region.

“I’ve long felt that the Western Hemisphere should work more closely together to advance a common agenda. Our geography, mutual interests and common values make for a natural partnership. We’ve got to leverage this partnership to strengthen our trade relations with each other and with the fastest growing area of the world: the Asia-Pacific region,” Under Secretary of Commerce for International Trade Francisco Sánchez said.

Sánchez made this appeal at the Inter-American Development Bank in Washington January 31, as the nine members of the Trans-Pacific Partnership (TPP) prepare for their next round of talks in Australia in March.

The TPP was founded by Brunei, Chile, New Zealand and Singapore in 2006. Since then, Australia, Malaysia, Peru, the United States and Vietnam have joined, while Canada, Japan and Mexico are engaged in membership talks. The founding members set the goal of eliminating 90 percent of tariffs among themselves by 2006 and of getting rid of the remaining 10 percent by 2015. The founders negotiated the partnership independently of the Asia-Pacific Economic Cooperation (APEC) forum. The U.S. government joined the TPP after realizing its usefulness in creating the Free Trade Area of the Asia-Pacific, which is an APEC goal.

In his speech to the bank, Sánchez recommended that the Western Hemisphere partners build their trading relations around what he called the five “E’s”:

• Expanding market access by removing all tariffs and other barriers to trade.

• Enacting a fully regional approach to maximize the development of production and supply chains across the region.

• Easing the regulatory challenges facing businesses — especially for small and medium enterprises, which he said are the main engine for job creation.

• Ensuring that new industries, such as clean technology and the digital economy, are fostered.

• Establishing a living agreement that allows its signatories to address developments that arise in the future.

The under secretary pointed to U.S. trade agreements with Chile and Peru as models for trade relations with other partners in the hemisphere.

“Since the U.S.-Chile Free Trade Agreement went into effect in 2004, total bilateral trade has more than doubled, reaching more than $18 billion in 2010,” Sánchez said.

The U.S.-Peru Trade Promotion Agreement, which went into effect in 2009, has enabled the two countries to maintain a “strong and resilient” trading relationship despite the global economic crisis, Sánchez said. “Bilateral trade bounced back to pre-crisis levels of nearly $12 billion in 2010. These economic ties are supporting jobs and businesses in all our countries,” he added.

The United States will present economic initiatives at the Summit of the Americas, scheduled for Colombia in April, with the goal of expanding hemispheric trade based on the shared values of fairness and opportunity, Sánchez said.

At the same time that government leaders participate in the summit, the Inter-American Development Bank and Colombia’s business community will host a gathering of business executives from throughout the hemisphere to “ensure that the private sector’s voice is heard and conveyed to our hemisphere’s senior policymakers,” Sánchez said.

“We want all of our trading partners to be innovators and to experience the growth that results from strong legal systems, robust intellectual property rights and open-market economies,” Sánchez said. “And we want a strong TPP that strengthens the economy within the Western Hemisphere, which in turn enhances the region’s presence in the Asia-Pacific.”

Geneva,
February 7, 2012

Thank you, Chair.

The United States is pleased to participate in Kuwait’s first Trade Policy Review.  We welcome the convening of this long-delayed initial trade policy review of Kuwait, because we believe that the transparency obtained from TPRs is important for the WTO and for the Members subject to the review. We hope that this review will be a positive experience for Kuwait and that future reviews can occur within appropriate timeframes.  We extend a warm welcome to Ambassador Dharar A. R. Razzooqi and the entire Kuwait delegation.  We appreciate the report that your delegation submitted for this meeting, which provides useful information on developments in, and contributes to the transparency of, Kuwait’s trade policy regime and practices. The Secretariat’s report was similarly informative and comprehensive.  I would also like to thank our discussant, Ambassador Shahid Bashir, for his meaningful contributions to this important TPR for Kuwait.

The United States and Kuwait enjoy a broad, deep and robust bilateral relationship, with cooperation spanning many of the economic and security issues confronting the Middle East and the world.  On the commercial front, our bilateral trade is expanding.  In 2010, the U.S. exported almost $3 billion in goods to Kuwait, up more than 42 percent from 2009, and imported more than $5 billion in goods from Kuwait, also up more than 42 percent from 2009.  Additionally, U.S. foreign direct investment in Kuwait was almost $2 billion in 2010.

While Kuwait has reason to be pleased with the results of its economic reform efforts to date, the United States believes that there are areas for improvement.  We commend the Government of Kuwait for acknowledging the value of modernizing its business environment, tackling excessive administrative and procedural obstacles to doing business, and increasing the transparency, accountability and effectiveness of government administration, and we look forward to hearing more about the steps the government is taking in this regard.

In its report, the government outlines its efforts to diversify Kuwait’s economy and efforts to address other structural issues that have come to characterize the nation’s economy and life, including by enacting new laws or amending existing laws and regulations.  Given that foreign investors tend to favor locations that provide strong and effective intellectual property protection, we hope that these legislative changes will also address the concerns that we have raised regarding Kuwait’s intellectual property laws, particularly the 1999 Copyright Law.  We encourage Kuwait to take appropriate steps to address current high levels of copyright piracy and to bring its legislation into full compliance with TRIPs obligations. Such measures would help Kuwait enhance its status as an investment destination.

On investment, we encourage Kuwait to carefully consider the impact of its existing investment restrictions on the investment climate.  For example, we urge Kuwait to think seriously about whether restrictions on the ability of non-Kuwaiti citizens to pursue commercial activities in Kuwait without a Kuwaiti partner and the ability of non-Kuwaiti partners to own more than 49% of the company’s capital – are helping Kuwait to fulfill its potential as an attractive investment destination.

The United States would also like to note the key role that a fair and transparent government procurement regime can also play in attracting foreign investment.  We urge Kuwait to become an observer to the WTO Committee on Government Procurement.  In addition, since the revision of the Government Procurement Agreement (GPA) that was agreed upon at the WTO Ministerial in December 2011 will facilitate accession to the GPA, we strongly encourage Kuwait to commence accession to the GPA as soon as possible.

In the modern international economy, the information and communications technology (ICT/telecom) sector continues to grow in importance, not only for mobile telephones and the Internet, but for ICT’s impact on all economic sectors – from finance to hydrocarbons, from transportation to health care.  We encourage Kuwait to deepen development in its ICT sector through reform and the strengthening of an autonomous and accountable regulatory authority.  International experience shows that a strong independent ICT regulator is essential to creating a competitive market and a legal environment conducive to foreign and private investment, economic growth, modernization, anti-corruption measures, and establishment of responsive social services such as e-Government, e-Education, e-Medicine, and e-Administration.  Along with Kuwait’s oil and gas sector, its ICT sector has a growing impact on its own economy, the region of the Middle East and North Africa and the world.

We would also like to highlight the complex nature of Kuwait’s import regime.  As the Secretariat’s report notes, foreign entities may only establish a branch in Kuwait and may only pursue commercial activities in Kuwait through a Kuwaiti agent.  The Secretariat’s report also notes a requirement for documents to be authenticated and consular fees to be paid on commercial invoices.  The interplay of these types of requirements seems highly burdensome, and we hope Kuwait will shed light on these practices and the scope of their application during the course of this review.

Another important issue relates to notifications, an important aspect of our work here at the WTO because notifications provide transparency that is essential to the operation of WTO agreements, including the ability of Members to assess if substantive obligations are being respected. The United States notes that up to mid-October 2011, Kuwait had made only 69 notifications of standards and technical regulations to the WTO.  We would like to urge Kuwait to ensure that all such regulations and standards are notified to WTO Members as required by the TBT and SPS Agreements. It is of utmost importance that the notifications include draft versions of the regulations, that they be issued with enough advance notice that stakeholders have sufficient time to review and comment on them, and that Kuwaiti authorities can take those comments into account before finalizing the regulation or standard.  The United States has found that consultation with, and involvement by, all interested parties in the regulatory process leads to rules and regulations that better meet their objectives while minimizing trade distorting effects.  We encourage Kuwait to update or submit its notifications, as appropriate. 

We also request that Kuwait, as well as its GCC partners, complete their review of the Secretariat’s Factual Presentation on the GCC Customs Union, so that it can be reviewed in the Committee on Regional Trade Agreements.

In general, the United States continues to be concerned about the lack of transparency in Kuwait’s trade policy regime, which has led us to ask Kuwait so many written questions for this TPR.  We, ourselves, became increasingly surprised at how many matters we found to be important and for which we were unable to obtain answers independently.  The institutional value of the TPRM in enhancing the WTO’s core principle of transparency came into sharp focus. We thank Kuwait in advance for its efforts to respond to our questions, and we plan to review its responses carefully and request clarifications as necessary during the course of this TPR.

The United States encourages Kuwait to take advantage of the opportunities to implement meaningful economic reforms, which, as experience has shown, will significantly advance Kuwait’s objectives of inclusive growth and economic development.  The United States joins other WTO Members in supporting Kuwait’s use of an open trade policy to fulfilling these broader objectives.

In conclusion, Chair, the United States shares a positive and supportive partnership with Kuwait, and we hope that Kuwait will find this review to be useful in its reform efforts and in its participation at the WTO.

Thank you.

Japan and the United States have made important progress on a range of trade and regulatory issues as well as on new areas of joint cooperation that will expand trade opportunities for producers and consumers in both countries.

Today’s report is a tremendous victory for the United States – particularly its manufacturers and workers.

U.S. Trade Representative Ron Kirk Announces U.S. Victory in Challenge to China’s Raw Materials Export Restraints
Washington, D.C.
January 30, 2012

U.S. Trade Representative Ron Kirk today announced that the World Trade Organization (WTO) Appellate Body found China’s export restraints on several industrial raw materials used as key components in the steel, aluminum, and chemicals industries to be inconsistent with China’s WTO obligations.  The Appellate Body affirmed a WTO dispute settlement panel’s July 2011 finding, therefore agreeing with the United States and rejecting China’s attempts to portray its export restraints as conservation or environmental protection measures or measures taken to manage critical shortages of supply.

“Today’s report is a tremendous victory for the United States – particularly its manufacturers and workers,” Ambassador Kirk said.  “The Obama Administration will continue to ensure that China and every other country play by the rules so that U.S. workers and companies can compete and succeed on a level playing field.  During his State of the Union Address last week, the President laid out a  blueprint for an economy that’s built to last – an economy built with the renewed strength of American manufacturing.  Today’s decision ensures that core manufacturing industries in this country can get the materials they need to produce and compete on a level playing field.”

The export restraints challenged in this dispute include export quotas and export duties, as well as related minimum export price, export licensing, and export quota administration requirements.  The raw materials at issue include various forms of bauxite, coke, fluorspar, magnesium, manganese, silicon carbide, silicon metal, yellow phosphorus, and zinc.  Export restraints on these types of industrial products can skew the playing field against the United States and other countries in the production and export of numerous steel, aluminum and chemical, and a wide range of other products.  They can artificially increase world prices for these raw materials while artificially lowering prices for Chinese producers.  This enables China’s domestic producers to produce lower-priced products from the raw materials and thereby creates significant advantages for China’s producers when competing against U.S. and other producers, both in China’s market and other countries’ markets.  Such export restraints can also create substantial pressure on foreign producers to move their operations and, as a result, their technologies to China.

The European Union and Mexico joined the United States as co-complainants in the dispute.  Upon a U.S. request, the WTO Dispute Settlement Body (DSB) will adopt the panel and Appellate Body reports within 30 days and call for China to bring its measures into compliance with its WTO obligations.

BACKGROUND

On June 23, 2009, the United States requested WTO dispute settlement consultations with China regarding export restraints maintained by China on various forms of bauxite, coke, fluorspar, magnesium, manganese, silicon carbide, silicon metal, yellow phosphorus, and zinc.  On the same day, the European Union also requested consultations with China.  On August 21, 2009, a third WTO Member, Mexico, requested consultations with China.  On December 21, 2009, a single WTO panel was established to examine the three complaints.  Argentina, Brazil, Canada, Chile, Colombia, Ecuador, India, Japan, Korea, Norway, Saudi Arabia, Chinese Taipei, and Turkey joined as third parties in the dispute.

The panel found that the export duties and export quotas that China maintains on various forms of bauxite, coke, fluorspar, magnesium, manganese, silicon carbide, silicon metal, and zinc constitute a breach of WTO rules and that China failed to justify those measures as legitimate conservation measures, environmental protection measures, or short supply measures.  The panel also found that China’s imposition of minimum export price, export licensing, and export quota administration requirements on these materials, as well as China’s failure to publish certain measures related to these requirements, is inconsistent with WTO rules.

On August 31, 2011, China appealed certain aspects of the panel’s report.  On September 6, 2011, the United States and its co-complainants filed limited cross appeals on certain procedural and other findings made by the panel.  A hearing took place before the WTO’s Appellate Body on November 7-9, 2011.  In its report, the Appellate Body rejected China’s appeal and confirmed that:  China may not seek to justify its imposition of export duties pursuant to the exceptions provided in Article XX of the GATT 1994; China failed to demonstrate that certain of its export quotas were justified as measures for preventing or relieving a critical shortage under Article XI:2(a) of the GATT 1994; and the Panel correctly made recommendations for China to bring its measures into conformity with its WTO obligations.  The Appellate Body also found that the Panel erred:  in making findings related to licensing and administration claims identified in Section III of the U.S. panel request, declaring those findings moot; and in the Panel’s legal interpretation of one element of the exception set forth in Article XX(g) of the GATT 1994 (China did not appeal the Panel’s conclusion that China had failed to establish a defense under Article XX(g)).

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1. SURVEILLANCE OF IMPLEMENTATION OF RECOMMENDATIONS ADOPTED BY THE DSB

A.        UNITED STATES – SECTION 211 OMNIBUS APPROPRIATIONS ACT OF 1998:  STATUS REPORT BY THE UNITED STATES (WT/DS176/11/ADD.110)

The United States provided a status report in this dispute on January 9, 2012, in accordance with Article 21.6 of the DSU.

Legislative proposals have been introduced in the current 112th Congress that would implement the recommendations and rulings of the DSB.

The U.S. Administration will continue to work on solutions to implement the DSB’s recommendations and rulings.

B.        UNITED STATES – ANTI-DUMPING MEASURES ON CERTAIN HOT-ROLLED STEEL PRODUCTS FROM JAPAN:  STATUS REPORT BY THE UNITED STATES (WT/DS184/15/ADD.110)

The United States provided a status report in this dispute on January 9, 2012, in accordance with Article 21.6 of the DSU.

As of November 2002, the U.S. authorities had addressed the DSB’s recommendations and rulings with respect to the calculation of antidumping margins in the hot-rolled steel antidumping duty investigation at issue in this dispute.

With respect to the recommendations and rulings of the DSB that were not already addressed by the U.S. authorities, the U.S. Administration will work with the U.S. Congress with respect to appropriate statutory measures that would resolve this matter.

C.        UNITED STATES – SECTION 110(5) OF THE US COPYRIGHT ACT: STATUS REPORT BY THE UNITED STATES (WT/DS160/24/ADD.85)

The United States provided a status report in this dispute on January 9, 2012, in accordance with Article 21.6 of the DSU.

The U.S. Administration will continue to confer with the European Union, and to work closely with the U.S. Congress, in order to reach a mutually satisfactory resolution of this matter.

D.        EUROPEAN COMMUNITIES  – MEASURES AFFECTING THE APPROVAL AND MARKETING OF BIOTECH PRODUCTS:  STATUS  REPORT BY THE EUROPEAN UNION (WT/DS291/37/ADD.48)

The United States thanks the EU for its status report and its statement today.

Between today’s meeting and the last regularly-scheduled meeting in 2011, the EU approved four long-pending product applications, including three varieties of biotech maize.

Although the United States welcomes any movement in the EU system, these approvals hardly put a dent in the backlog of approximately 70 pending applications.

Further, the slow progress of these three maize applications illustrates U.S. concerns with the EU approval system.

The EU’s scientific authority issued positive safety assessments for these three varieties in May 2010, over 1 year and 8 months ago.

Under the EU’s legislation, these products should have been submitted to the EU’s regulatory committee within 3 months of May 2010.  The regulatory committee, which consists of EU member State representatives, should have proceeded to vote in accordance with the scientific assessments and approve the applications.

This, however, did not occur.  Instead, the applications were held up for well over a year in the EU’s approval process.  In all, the time taken after the scientific assessment – that is, from May 2010 until December 2011 – was 5 or 6 times longer than contemplated in the EU’s own law.

The delays for these products are unfortunately typical.  And as a result of such delays, U.S. maize products remain shut out of the EU market.

The United States hopes the EU will address these issues in the coming year.

E.         UNITED STATES – MEASURES RELATING TO ZEROING AND SUNSET REVIEWS:  STATUS REPORT BY THE UNITED STATES (WT/DS322/36/ADD.28)

The United States provided a status report in this dispute on January 9, 2012, in accordance with Article 21.6 of the DSU.

In December 2010, the Arbitrator in the proceeding under Article 22.6 of the DSU in this dispute issued a communication stating that it had accepted a joint request by the parties to the dispute to suspend its work.

On January 9, 2012, in response to a joint request of the United States and Japan, the Arbitrator issued a communication stating that it has decided to continue further the suspension.  The communication of the Arbitrator has been circulated to the DSB in document WT/DS322/42.

As the United States explained in its status report, in December 2010 the U.S.

Department of Commerce announced a proposal to change the calculation of weighted average dumping margins and assessment rates in certain antidumping proceedings.  At this time, the U.S. Department of Commerce is continuing with its ongoing work on the proposal.

F.         UNITED STATES – CONTINUED EXISTENCE AND APPLICATION OF ZEROING METHODOLOGY:  STATUS REPORT BY THE UNITED STATES (WT/DS350/18/ADD.25)

The United States has addressed the issue of compliance with the recommendations in this dispute in the status report provided on January 9, 2012, and earlier in today’s discussion of agenda item 1.E.  We refer Members to that report and statement for further details.G.        UNITED STATES – LAWS, REGULATIONS AND METHODOLOGY FOR CALCULATING DUMPING MARGINS (“ZEROING”):  STATUS REPORT BY THE UNITED STATES (WT/DS294/38/ADD.20)

The United States has addressed the issue of compliance with the findings in this dispute in the status report provided on January 9, 2012, and earlier in today’s discussion of agenda item 1.E.  We refer Members to that report and statement for further details. In addition, we note that in September 2010, the Arbitrator in the proceeding under Article 22.6 of the DSU in this dispute issued a communication stating that it had accepted a joint request by the parties to the dispute to suspend its work.

On January 16, 2012, in response to a joint request of the parties, the Arbitrator issued a communication stating that it has decided to continue the suspension.  The communication of the Arbitrator has been circulated to the DSB in document WT/DS294/42.
H.        CHINA – MEASURES AFFECTING TRADING RIGHTS AND DISTRIBUTION SERVICES FOR CERTAIN PUBLICATIONS AND AUDIOVISUAL ENTERTAINMENT PRODUCTS:  STATUS REPORT BY CHINA (WT/DS363/17/ADD.12)
The United States thanks China for its status report and its statement today.

As the United States has previously noted, we remain concerned by the lack of progress by China in bringing its measures relating to films for theatrical release into compliance with the DSB recommendations and rulings.

The United States also has significant concerns about the incomplete progress relative to China’s measures relating to audio visual home entertainment products, reading materials, and sound recordings.

The United States is conferring with China on these matters.  We hope that China will take steps to resolve this matter soon.

I.         UNITED STATES – ANTI-DUMPING ADMINISTRATIVE REVIEWS AND OTHER MEASURES RELATED TO IMPORTS OF CERTAIN ORANGE JUICE FROM BRAZIL:  STATUS REPORT BY THE UNITED STATES (WT/DS382/11/ADD.1)

Madam Chair, the United States provided a status report in this dispute on January 9, 2012, in accordance with Article 21.6 of the DSU.

As noted in the status report, the United States informed the DSB on June 17, 2011, of its intention to implement the DSB’s recommendations and rulings in this dispute.  Brazil and the United States agreed that the reasonable period of time to implement would expire on March 17, 2012.

As the United States explained in its status report, in December 2010 the U.S.

Department of Commerce announced a proposal to change the calculation of weighted average dumping margins and assessment rates in certain antidumping proceedings.  At this time, the U.S. Department of Commerce is continuing with its ongoing work on the proposal.

8.  PHILIPPINES – TAXES ON DISTILLED SPIRITS

A.        REPORT OF THE APPELLATE BODY (WT/DS396/AB/R) AND REPORT OF THE PANEL (WT/DS396/R)

B.        REPORT OF THE APPELLATE BODY (WT/DS403/AB/R) AND REPORT OF THE PANEL (WT/DS403/R)

Madam Chair, we would like to begin by thanking the Appellate Body, the panelists, and the Secretariat for their work on this matter.

The United States has been concerned for many years about the Philippines’ discriminatory taxes on distilled spirits and is pleased to propose the adoption of the Panel and Appellate Body reports in the dispute brought by the United States (WT/DS403/AB/R and WT/DS403/R).

The reports are precise and thorough, and are a strong affirmation of the longstanding commitments in the GATT 1994 to the non-discriminatory treatment of imported products.

The legal claims presented in this dispute were not novel, but there were a number of new issues raised and both the Appellate Body and the Panel carefully considered the evidence before it in the context of this specific dispute, focusing on the operation of the Philippine measures at issue.

The Appellate Body’s analysis is methodical, and focuses on the Panel’s treatment of the evidence before it.  Separately, it reviewed the appellant’s claims of error as they related to the specific elements of the claims against the Philippines’ measures, and tailored its analysis to the specific facts in this dispute.

As a result, the report provides clear and specific findings with respect to the Philippines’ measures.  Moreover, the United States appreciates the focused nature of the report. Although the Panel and Appellate Body fully addressed the parties’ arguments and evidence, it did not add to the reports additional discussion or speculation not necessary to resolve the questions before it.

The Panel and the Appellate Body reports definitively confirm that these taxes are not consistent with the Philippines’ obligations.  Further, the reports separately and independently support the two claims by the United States:  that the Philippine measures are inconsistent with the Philippines’ obligations under the first and second sentences of Article III:2 of the GATT 1994.

We look forward to action very soon by the Philippines to reform its tax system to meet its WTO obligations.

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These seized counterfeit Apple iPods and iPhones were displayed at the Port of Los Angeles in February.

Washington DC,
22 December 2011

1. UNITED STATES – CERTAIN COUNTRY OF ORIGIN LABELLING (COOL) REQUIREMENTS

A. JOINT REQUEST BY CANADA AND THE UNITED STATES FOR A DECISION BY THE DSB (WT/DS384/11)

B. JOINT REQUEST BY MEXICO AND THE UNITED STATES FOR A DECISION BY THE DSB (WT/DS386/10)

• The United States is joining Canada and Mexico in asking that the DSB agree to provide additional time for adoption or appeal of the panel reports in these disputes by adopting the draft decision set forth in document WT/DS384/11 and the draft decision in document WT/DS386/10.

• The Appellate Body has informally requested the parties to delay any appeal in these disputes to allow it to better manage its
current workload and complete pending appeals from 2011.

• As Canada and Mexico have expressed, and as has been stated at several previous DSB meetings, the United States views such DSB decisions as exceptional in nature and taken in response to the unusual circumstances faced by the Appellate Body and WTO Members today.

• After discussions with Canada and Mexico, the United States agreed to join in making these requests. The draft decisions would
provide for DSB adoption of the panel reports by negative consensus no later than March 23, 2012.

• We would therefore would appreciate the DSB’s support for the draft decisions.

A.        Recourse to article 7.9 of the scm agreement and article 22.2 of the dsu by the united states (wt/ds316/18)

• On June 1, 2011, the DSB adopted its recommendations and rulings in this dispute.  The DSB recommended that the Member granting each subsidy found to have resulted in adverse effects bring the subsidy into compliance with its obligations under the SCM Agreement.  Under Article 7.9 of the SCM Agreement, the EU and certain member States had six months to withdraw the subsidies or take appropriate steps to remove the adverse effects of the subsidies.
• That six-month period ended on December 1, 2011.  The EU and the four member States at issue have not removed the adverse effects or withdrawn the subsidies within that period.
• In the absence of any agreement on compensation, the United States has requested authorization to take countermeasures at an annual level commensurate with the degree and nature of the adverse effects determined to exist, pursuant to Article 7.9 of the SCM Agreement and Article 22.2 of the DSU.  This amount corresponds to the annual value of lost sales, of exports of U.S. large civil aircraft displaced from the EU market, and of exports of U.S. large civil aircraft displaced from third country markets.
• We took this step in light of Article 22.6 of the DSU, which provides for the negative consensus rule to apply within 30 days of the end of the period for compliance.  If the EU does not object to the U.S. request, the DSB will approve the U.S. request for authorization today unless the DSB decides by consensus to reject the request.  If the EU objects, the matter is automatically referred to arbitration.
• On December 9, 2011, in order to facilitate a resolution of this dispute, the United States also requested consultations with the EU and the member States at issue with regard to this matter.  The EU has accepted our request, and consultations are scheduled for early January 2012.
• We are looking forward to those consultations.  As mentioned at the last DSB meeting, the United States remains prepared to engage in any meaningful efforts that will lead to the goal of ending subsidized financing of large civil aircraft at the earliest possible date.  We hope to find willing partners at the consultations and beyond.
• Finally, the United States notes that we are currently working with the EU on a sequencing agreement for procedures under Articles 21 and 22 of the DSU for the purposes of this dispute.  Any such agreement would be notified to the DSB.

[Second intervention:]

• The United States takes note of the EU’s objection in its statement pursuant to DSU Article 22.6.  Members will be aware of the different views of the parties on this issue.  In the U.S. view, under the terms of the DSU, the EU’s objection automatically results in the matter being referred to arbitration.
• Article 22.6 does not refer to any decision by the DSB in this regard.  Thus, there is no need today for the DSB to take any further action or decision for this matter to be referred to arbitration.
• Nevertheless, we have no objection if the DSB wishes to take note of the fact that this issue has been raised and confirm that it may not consider the U.S. request for authorization, which is the item on the agenda today, since the matter is being referred to arbitration.
• We do note that it would have been preferable had the EU objection been filed before this meeting.  The United States would then have been willing to withdraw its request in light of the referral of the matter to arbitration, and this meeting would have been canceled.  This is the procedure that was followed by Japan and the United States in the US – Zeroing (DS322) dispute.
• Nonetheless, in light of the EU’s objection today, we recognize that the DSB cannot take action on the U.S. request for authorization to take countermeasures.

USTR Press Release

Geneva, Switzerland – U.S. Trade Representative Ron Kirk has welcomed today’s decisions of Ministers at the 8th WTO Ministerial Conference formally inviting Montenegro and Samoa to join the World Trade Organization (WTO).

“The United States will be pleased to work with Samoa and Montenegro as full partners in the WTO,” said Ambassador Kirk. “Approval of these accession packages, along with yesterday’s invitation to Russia and action this year on Vanuatu, testifies to the ability of the WTO to continually renew itself by incorporating new Members of widely varying sizes and levels of economic development.”

Ambassador Kirk also noted that the United States looks forward to participating constructively in the work program on least developed country (LDC) accessions to be approved by the Ministerial Conference.