GD/202
United States - Restrictions on Imports of Sugar
Other titles
US Sugar (Source: GATT Analytical Index)
Products at Issue
| Products at issue |
Sugar
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| Type of product |
Agricultural
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| Product sub-type |
Sugar and confectionary
|
Related disputes
| GATT | |
| WTO |
Key legal aspects
| Legal basis |
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| Claims raised |
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| Defences raised |
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Adjudicators
| Type | Panel |
| Chairperson | Keith Broadbridge (Hong Kong) |
| Other members | Witold Jozwiak (Poland), Elbio Rosselli (Uruguay) |
| Type | Panel |
| Legal basis at issue |
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| Claims at issue |
|
| Defences at issue |
|
| No of Pages (total / legal reasoning) | 15 |
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Timeline
| Request for consultations |
|
| Request for establishment | |
| Establishment | |
| Composition | |
| Report | |
| Adoption of report |
Outcome
| Outcome of the proceedings |
Report adopted
|
| Additional Info | L/6514 (09/06/1989) United States – Restrictions on Imports of Sugar – Report of the Panel: The United States maintains quantitative restrictions on the importation of certain sugars described in its GATT Schedule of Concessions. The maintenance of quantitative restrictions is inconsistent with Article XI:1 of the General Agreement. The United States argues that the proviso "subject to the terms, conditions or qualifications set forth in that Schedule" in Article II:1(b) permits contracting parties to include qualifications relating to quantitative restrictions in their Schedule. The United States further argues that it had made use of this possibility by reserving in its Schedule of Concessions the right to impose quota limitations on imports of sugar in certain circumstances. The Panel noted that in Article II:l(b), the words "subject to the ... qualifications set forth in that Schedule" are used in conjunction with the words "shall ... be exempt from ordinary customs duties in excess of those set forth in [the Schedule]". This suggests that Article II:l(b) permits contracting parties to qualify the obligation to exempt products from customs duties in excess of the levels specified in the Schedule, not however to qualify their obligations under other Articles of the General Agreement. The Panel further noted that the title of Article II is "Schedules of Concessions" and that the ordinary meaning of the word "to concede" is "to grant or yield". This also suggests in the view of the Panel that Article II permits contracting parties to incorporate into their Schedules acts yielding rights under the General Agreement but not acts diminishing obligations under that Agreement. The Panel further noted that one of the basic functions of the General Agreement is, according to its Preamble, to provide a legal framework enabling contracting parties to enter into "reciprocal and mutually advantageous arrangements directed to the substantial reduction of tariffs and other barriers to trade". Where the General Agreement mentions specific types of negotiations, it refers to negotiations aimed at the reduction of barriers to trade. This supports in the view of the Panel the assumption that Article II gives contracting parties the possibility to incorporate into the legal framework of the General Agreement commitments additional to those already contained in the General Agreement and to qualify such additional commitments, not however to reduce their commitments under other provisions of that Agreement. The Panel also examined the issue in the light of the practice of the contracting parties and the negotiating history of the provision. The Panel noted that the contracting parties did not envisage that qualifications in Schedules established in accordance with Article II:l(b) could justify measures inconsistent with the other Articles of the General Agreement. Noting that Schedule provisions qualifying obligations under the General Agreement were not included in the specimen Schedule nor was the possibility of such Schedule provisions mentioned by the drafters, the Panel found that the drafting history also did not support the interpretation advanced by the United States. The Panel therefore found that Article II:l(b) does not permit contracting parties to qualify their obligations under other provisions of the General Agreement and that the provisions in the United States GATT Schedule of Concessions can consequently not justify the maintenance of quantitative restrictions on the importation of certain sugars inconsistent with the application of Article XI:1. The Panel therefore concluded that the restrictions on the importation of certain sugars maintained by the United States under the authority of the Headnote in the Tariff Schedule of the United States are inconsistent with Article XI:1 and cannot be justified under the provisions of Article II:l(b), and recommended that the contracting parties request the United States either to terminate these restrictions or to bring them into conformity with the General Agreement. |