GD/133

United States Manufacturing Clause

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Other titles

US Manufacturing Clause (Source: GATT Analytical Index)

Parties

Complainant
EEC
EEC-10
Respondent
United States
Third Parties

Products at Issue

Products at issue
Books
Type of product
Non-agricultural
Product sub-type
Paper products

Related disputes

GATT
WTO

Key legal aspects

Legal basis
  • GATT Article XXII:1
  • GATT Article XXIII:1
Claims raised
  • Concessions under the understanding between US and the EEC during the Tokyo Round
  • GATT Article III:1
  • GATT Article XI
  • GATT Article XIII
Defences raised
  • GATT Part II
  • Protocol of Provisional Application (PPA) para. 1(b)

Adjudicators

Type Panel
Chairperson P. Rantanen (Finland)
Other members N. Kemmochi (Japan), Siraj Haron (Malaysia)

Report

Type Panel
Legal basis at issue
  • GATT Article XXII:1
  • GATT Article XXIII:1
Claims at issue
  • Concessions under the understanding between US and the EEC during the Tokyo Round
  • GATT Article III:1
  • GATT Article XI
  • GATT Article XIII
Defences at issue
  • GATT Part II
  • Protocol of Provisional Application (PPA) para. 1(b)
No of Pages (total / legal reasoning) 14 (and 3 annex)
  • -
  • -
  • Judicial economy exercised
  • Not in report conclusions
  • Inconsistency found
  • Judicial economy exercised
  • Not in report conclusions
  • Defence found to be inapplicable

Timeline

Request for consultations
Request for establishment
Establishment
Composition
Report
Adoption of report

Outcome

Outcome of the proceedings
Report adopted
Additional Info C/M/160 (24/09/1982) Minutes of Council Meeting (21/07/1982) "The representative of the European Communities, speaking under "Other Business", drew the attention of the Council to United States copyright and manufacturing clause legislation prohibiting imports of certain books in English written by United States citizens which were printed abroad. His delegation was of the opinion that such legislation was contrary to the provisions of Article III:1, XI and XIII of the General Agreement. He stated that bilateral consultations had taken place with the United States and that verbal notes had been exchanged. The EEC reserved the right to revert to this matter at a future meeting of the Council. The representative of the United States stated that the United States was willing to discuss this matter and that discussions had already taken place under the provisions of Article XXII. His delegation believed that any trade effects resulting from this legislation were slight and temporary. The Council took note of the statements." (Original underlined)

L/5609 (01/03/1984) United States Manufacturing Clause - Report of the Panel: The matter concerned the re-enactment of the Manufacturing Clause in 1982 of the United States' copyright legislation. The Panel found that that the prohibition of imports of certain printed matter provided for in the Manufacturing Clause was inconsistent with GATT Article XI:1 and that the United States had neither contested this nor attempted to justify the Manufacturing Clause under any of the exceptions to Article XI:1.

The Panel then examined whether this inconsistency with Article XI could be justified under paragraph 1(b) of the Protocol of Provisional Application, under which the United States applies the General Agreement, according to which Part II of the General Agreement was to be applied "to the fullest extent not inconsistent with existing legislation", that is mandatory legislation in force on 30 October 1947. In 1976, the United States had introduced an expiry date of 1 July 1982 for the Manufacturing Clause, which had then been reversed by the 1982 legislation. The Panel observed that the expiry date inserted in the Clause in 1976 was the first such provision introduced since the legislation came into force in 1891 and represented a move towards greater GATT conformity. The Panel noted that the Protocol had been conceived of as providing a temporary dispensation to enable contracting parties to apply Part II of the General Agreement without changing existing legislation or acting inconsistently with it. Given this purpose of the Protocol, the Panel believed that, once a contracting party had reduced the degree of inconsistency of "existing legislation" with the General Agreement, there could be no justification for a subsequent move to increase the degree of GATT inconsistency of such legislation. The Panel therefore found that the Protocol of Provisional Application did not authorize contracting parties to enact legislation increasing the degree of GATT inconsistency of "existing legislation", even if that degree of inconsistency remained not in excess of that which had obtained on 30 October 1947. The Panel therefore found that the United States legislation of 13 July 1982 postponing the expiry date of the Manufacturing Clause could not be justified under the Protocol of Provisional Application.