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UNITED STATES � MEASURES AFFECTING THE CROSS-BORDER SUPPLY OF
AB-2005-1
(Continued)
129. In the course of examining what measures Antigua was challenging in this dispute, the Panel relied on certain Appellate Body decisions in support of its view that "'practice' can be considered as an autonomous measure that can be challenged in and of itself".134 The Panel then observed that certain acts identified by Antigua could constitute "practices", as that term had been understood by the panel in US � Corrosion-Resistant Steel Sunset Review. However, based on Antigua's clarification in its comments to the United States' request for preliminary rulings, the Panel concluded that Antigua was "not challenging [any] practice[] 'as such'".135 130. The United States challenges the Panel's view that "practice" may be challenged in and of itself.136 Antigua agrees with the Panel that "practice" can be challenged, as such, in WTO dispute settlement, but submits that in this case "this issue appeared to be without any real context" and, therefore, that the Appellate Body need not pronounce on it.137 131. We disagree with the participants' characterization of the Panel's statement on "practice", in paragraph 6.197 of the Panel Report, as a "finding" of the Panel.138 The Panel itself acknowledged that, in any case, Antigua was not challenging a practice, as such. In this light, the Panel's statement on "practice", in our view, was a mere obiter dictum, and we need not rule on it. 132. We nevertheless express our disagreement with the Panel's understanding of previous Appellate Body decisions. The Appellate Body has not, to date, pronounced upon the issue of whether "practice" may be challenged, as such, as a "measure" in WTO dispute settlement.139
133. We examine next the United States' claim on appeal that Antigua failed to establish a prima facie case of inconsistency with Article XVI of the GATS, with respect to the eight state laws and the three federal laws that the Panel determined were the measures that it should examine. 134. Antigua's panel request listed nine federal laws and eighty-four other laws from all fifty states, as well as from the District of Columbia, Guam, Puerto Rico, and the United States Virgin Islands.140 In seeking to identify, from this list, the measures that were the subject of Antigua's claims, the Panel explained that it had:
135. The Panel found that certain state laws that had been mentioned by Antigua in its submissions, but which were not identified in the panel request, were not properly before the Panel.142 The Panel also found that certain state and federal laws, although mentioned in the panel request, had been only briefly discussed in summaries attached to the texts of the laws submitted by Antigua.143 In the Panel's view, these brief summaries were inadequate to explain how the laws allegedly resulted in a GATS-inconsistent prohibition on the cross-border supply of gambling services.144 136. The Panel then reviewed laws that had been mentioned in the panel request and that were discussed in Antigua's submissions. The Panel concluded that the Wire Act, the Travel Act, and the IGBA were identified sufficiently by Antigua because Antigua's "discussions indicate[d] according to which particular provisions and how the laws allegedly result in a prohibition on the cross-border supply of gambling and betting services."145 On the same basis, the Panel determined that Antigua had identified as part of its case certain laws of Colorado, Louisiana, Massachusetts, Minnesota, New Jersey, New York, South Dakota, and Utah.146 137. The United States contends that, in taking this approach, the Panel itself improperly made Antigua's prima facie case of inconsistency with Article XVI of the GATS. The United States claims that Antigua did not argue before the Panel how the laws eventually selected for review by the Panel constituted a "total prohibition" on the cross-border supply of gambling services. Finally, the United States argues, as Antigua's case throughout the panel proceedings was based on the existence of a "total prohibition", Antigua's arguments focused on allegations that the "total prohibition" is itself inconsistent with various provisions of the GATS. According to the United States, this meant that Antigua failed to allege that any of the individual measures discussed by the Panel is inconsistent with Article XVI of the GATS. 138. The complaining party bears the burden of proving an inconsistency with specific provisions of the covered agreements.147 With respect to arguments and the production of evidence, we note the following statement of the Appellate Body in US � Carbon Steel:
139. Where the complaining party has established its prima facie case, it is then for the responding party to rebut it.149 A panel errs when it rules on a claim for which the complaining party has failed to make a prima facie case.150 140. A prima facie case must be based on "evidence and legal argument" put forward by the complaining party in relation to each of the elements of the claim.151 A complaining party may not simply submit evidence and expect the panel to divine from it a claim of WTO-inconsistency.152 Nor may a complaining party simply allege facts without relating them to its legal arguments. 141. In the context of the sufficiency of panel requests under Article 6.2 of the DSU, the Appellate Body has found that a panel request:
Given that such a requirement applies to panel requests at the outset of a panel proceeding, we are of the view that a prima facie case�made in the course of submissions to the panel�demands no less of the complaining party. The evidence and arguments underlying a prima facie case, therefore, must be sufficient to identify the challenged measure and its basic import, identify the relevant WTO provision and obligation contained therein, and explain the basis for the claimed inconsistency of the measure with that provision. 142. Antigua's case focused on Article XVI:2 of the GATS and, in particular, its sub-paragraphs (a) and (c). The relevant provisions provide:
143. This text suggests that Antigua was required to make its prima facie case by first alleging that the United States had undertaken a market access commitment in its GATS Schedule; and, secondly, by identifying, with supporting evidence, how the challenged laws constitute impermissible "limitations" falling within Article XVI:2(a) or XVI:2(c). 144. In the present case, the Panel determined that Antigua could not pursue its claim on the basis of the "total prohibition" as the measure at issue.154 In our view, the Panel was correct in so concluding.155 In order for the Panel properly to continue with its analysis, then, Antigua was required to make its prima facie case with respect to specific federal and state laws identified in its panel request. 145. In its written submissions to the Panel, Antigua asserted that the United States had "made a full commitment [in its GATS Schedule] to the cross-border supply of gambling and betting services"156 along with references to the relevant sector of that Schedule.157 This assertion, in our view, satisfies the first requirement of Antigua's prima facie case under Article XVI:2.158 146. As to the second requirement of the prima facie case, Antigua's claims under sub-paragraphs (a) and (c) of Article XVI:2, as regards individual laws rather than the "total prohibition", are set out in the following paragraph from its second written submission to the Panel:
147. We begin our examination of the challenged measures with the three federal laws, namely, the Wire Act, the Travel Act, and the IGBA. We observe that Antigua submitted the texts of these statutes and explained its understanding of them.160 In support of its argument that the three federal statutes prohibited certain kinds of cross-border supply of gambling services, Antigua submitted to the Panel a report by the United States General Accounting Office161on internet gambling, and a letter from a Deputy Assistant Attorney General of the Department of Justice informing an industry association of broadcasters that internet gambling violates the three federal statutes.162 148. In addition, as we noted above163, Antigua, in its second written submission, alleged the "[f]ederal laws" prohibiting cross-border supply to be inconsistent with Article XVI. The United States argues that Antigua never "specifically alleged" the inconsistency of the three specific federal statutes with Article XVI.164 Although, Antigua did not expressly mention these statutes by name when alleging inconsistency with Article XVI, we are of the view that, in the context of Antigua's previous statement clearly identifying these three statutes165 and the Panel's subsequent questioning on these particular measures166, the reference to "[f]ederal laws" clearly covered the Wire Act, the Travel Act, and the IGBA. As a result, in our view, Antigua's arguments and evidence were sufficient to identify the Wire Act, the Travel Act, and the IGBA, and to make a prima facie case of their inconsistency with sub-paragraphs (a) and (c) of Article XVI:2. 149. As to the eight state laws reviewed by the Panel, we note that Antigua made no mention of them in the course of its argument that the United States acts inconsistently with Article XVI of the GATS. In none of Antigua's submissions to the Panel was the way in which these measures operate explained in a manner that would have made it apparent to the Panel and to the United States that an inconsistency with Article XVI was being alleged with respect to these measures. Thus, we see no basis on which we can conclude that Antigua sufficiently connected the eight state laws with Article XVI and thereby established a prima facie case of inconsistency with that provision. 150. In Antigua's first written submission to the Panel and in its opening statement at the first substantive panel meeting, none of the eight state laws was named in the context of Antigua's substantive claims.167 In its second written submission, Antigua alleged merely that "state laws"�without further specification�are inconsistent with Article XVI:2(a) and/or (c).168 Antigua did, however, make a cross-reference to a preceding section in its submission detailing the operation of various state laws.169 Yet, none of the state laws considered by the Panel is mentioned in that section. Rather, the discussion relates primarily to other states' laws170, addresses laws that are not in Antigua's panel request171, or speaks only in general terms.172 151. In our view, certain general statements made by Antigua in its second written submission were insufficient to permit the Panel to proceed on the basis that Antigua had established a prima facie case regarding the eight state laws identified by the Panel. For example, Antigua's second written submission contains a general discussion of state gambling laws, with footnote citations to, inter alia , a report by the United States General Accounting Office and a law review article.173 The law review article contains a discussion of state regulation of gambling, with reference, primarily in footnotes, to the laws of several states, including California, Hawaii, Illinois, Louisiana, and South Dakota. As we understand it, the Panel followed this trail of footnote references, and then compared the statutes cited in the footnotes of that law review article with Antigua's panel request to determine whether Antigua had identified provisions of those statutes and, thereby, to ascertain which state law Antigua intended to include as part of its claim.174 This led the Panel to conclude that certain laws of Louisiana and South Dakota were challenged by Antigua under Article XVI. 152. The Panel engaged in a similar multi-step analysis in seeking to discern some connection between the laws of Massachusetts, New Jersey, New York, and Utah, and Antigua's references in its written submissions and various exhibits.175 Yet we are unable to detect any connection, however tenuous, between the relevant laws of Colorado and Minnesota, on the one hand, and the allegation of inconsistency with Article XVI:2, on the other hand. Although Antigua did submit these laws in its exhibits, we see no arguments in any submissions that would have clearly informed the Panel and the United States how those two laws would form part of Antigua's claims under Article XVI:2(a) and XVI:2(c). It follows that, without providing a stronger link between the particular state law being challenged and the obligation alleged to have been infringed, Antigua failed to make a prima facie case with respect to any of these eight state laws. 153. In our view, therefore, Antigua established its prima facie case of inconsistency with Article XVI, only as to the Wire Act, the Travel Act, and the IGBA. In contrast, with respect to the state laws�that is, certain laws of Colorado, Louisiana, Massachusetts, Minnesota, New Jersey, New York, South Dakota, and Utah�we are of the view that Antigua failed to identify how these laws operated and how they were relevant to its claim of inconsistency with Article XVI:2. 154. Accordingly, we find that the Panel did not err in examining whether three federal laws�the Wire Act, the Travel Act, and the IGBA�are consistent with the United States' obligations under Article XVI of the GATS. We also find that the Panel erred in examining whether the following eight state laws are consistent with the United States' obligations under Article XVI of the GATS:
155. Furthermore, because the Panel erred in ruling on claims relating to these state laws, where no prima facie case of inconsistency had been made out by Antigua, we reverse the Panel's finding, in paragraphs 6.421(b) and 7.2(b)(ii) of the Panel Report, that the following state laws are inconsistent with Article XVI:1 and with sub-paragraphs (a) and (c) of Article XVI:2:
156. We note that the United States also advances an appeal under Article 11 of the DSU in relation to the Panel's assessment of Antigua's prima facie case. The United States argues that the Panel failed to comply with its obligations under Article 11 of the DSU, not merely because it made an error in finding a prima facie case, but because of "the egregious nature of the departure by this Panel from its assigned role of objective arbitrator."176 We have already found error in the Panel's examination of the aforementioned state laws177 on the basis that Antigua had not made a prima facie case of inconsistency with Article XVI:2. Therefore, in order to resolve this dispute, we need not determine whether, in assessing Antigua's prima facie case, the Panel also failed to satisfy its obligations under Article 11 of the DSU. 157. Finally, we note that, when making findings as to the Travel Act and the IGBA, the Panel referred to "the Travel Act (when read together with the relevant state laws)" and "the Illegal Gambling Business Act (when read together with the relevant state laws)".178 The Panel's reference to "the relevant state laws" in its findings on two federal laws simply reflects the fact that these two federal statutes explicitly incorporate certain criminal behaviour, defined under state law, as an element of the crimes under those federal statutes.179 Thus, the Panel's findings as to the Travel Act and the IGBA are not affected by our finding that the Panel should not have examined the GATS-consistency of these eight state laws. V. Interpretation of the Specific Commitments Made by the United States in its GATS Schedule 158. The Panel found, at paragraph 7.2(a) of the Panel Report, that:
The United States appeals this finding. According to the United States, by excluding "sporting" services from the scope of subsector 10.D of its GATS Schedule, it excluded gambling and betting services from the scope of the specific commitments that it undertook therein. The United States argues that the Panel misinterpreted the ordinary meaning of the text of subsector 10.D, "Other recreational services (except sporting)", and erroneously found that the ordinary meaning of "sporting" does not include gambling. The United States also contends that the Panel erred in its identification and analysis of the context in which the terms of subsector 10.D must be interpreted. In particular, the Panel is alleged to have mistakenly elevated certain documents used in the preparation of GATS Schedules (W/120 and the 1993 Scheduling Guidelines) to the status of "context", when they are in fact "mere 'preparatory work'"181, and, as such, cannot be relied upon when they suggest a meaning at odds with the unambiguous ordinary meaning of the text. According to the United States, the Panel relied on an "erroneous presumption" that, unless the United States "'expressly'" departed from W/120, the United States could be "'assumed to have relied on W/120 and the corresponding CPC references'".182 Finally, the United States argues, in the alternative, that the Panel should have found that gambling falls under subsector 10.E, "Other", where the United States made no commitment. 159. In the context of the GATT 1994, the Appellate Body has observed that, although each Member's Schedule represents the tariff commitments that bind one Member, Schedules also represent a common agreement among all Members.183 Accordingly, the task of ascertaining the meaning of a concession in a Schedule, like the task of interpreting any other treaty text, involves identifying the common intention of Members, and is to be achieved by following the customary rules of interpretation of public international law, codified in Articles 31 and 32 of the Vienna Convention.184 160. In the context of the GATS, Article XX:3 explicitly provides that Members' Schedules are an "integral part" of that agreement. Here, too, the task of identifying the meaning of a concession in a GATS Schedule, like the task of interpreting any other treaty text, involves identifying the common intention of Members. Like the Panel185�and, indeed, both the participants186�we consider that the meaning of the United States' GATS Schedule must be determined according to the rules codified in Article 31 and, to the extent appropriate, Article 32 of the Vienna Convention. 161. The contentious issues in this appeal concern whether the Panel erred in the way that it used the Vienna Convention principles of interpretation in determining the scope of the specific commitments made by the United States in subsector 10.D of its GATS Schedule, and whether the Panel erred in the conclusions it drew on the basis of its approach.
162. The United States' appeal focuses on the Panel's interpretation of the word "sporting" in subsector 10.D of the United States' GATS Schedule. According to the United States, the ordinary meaning of "sporting" includes gambling and betting and the Panel erred in finding otherwise. We observe first that the interpretative question addressed by the Panel was a broader one, namely "whether the US Schedule includes specific commitments on gambling and betting services notwithstanding the fact that the words 'gambling and betting services' do not appear in the US Schedule."187 In tackling this question, the Panel turned to Sector 10 of the United States' Schedule to the GATS, which Antigua claimed included a specific commitment on gambling and betting services, and the United States claimed did not. The relevant part of the United States' Schedule provides:188
163. In considering this section of the United States' Schedule, the Panel stated that it would begin by "examining the ordinary meaning of various key terms used in the US Schedule."189 The Panel examined the term "Other recreational services (except sporting)" in subsector 10.D, as well as the term "Entertainment services" in subsector 10.A. Having consulted the dictionary definitions of various words, the Panel found that "the ordinary meaning of 'sporting' does not include gambling".190 The United States submits that the Panel could not have made this finding had it properly followed Article 31(1) of the Vienna Convention. 164. Article 31(1) of the Vienna Convention requires a treaty to be interpreted "in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context and in the light of its object and purpose." In order to identify the ordinary meaning, a Panel may start with the dictionary definitions of the terms to be interpreted.191 But dictionaries, alone, are not necessarily capable of resolving complex questions of interpretation192, as they typically aim to catalogue all meanings of words�be those meanings common or rare, universal or specialized. 165. In this case, in examining definitions of "sporting", the Panel surveyed a variety of dictionaries and found a variety of definitions of the word.193 All of the dictionary definitions cited by the Panel define "sporting" as being connected to�in the sense of "related to", "suitable for", "engaged in" or "disposed to"�sports activities. Some dictionaries also define "sporting" as being connected to gambling or betting, but others do not. Of those that do, several note that the word is mainly used in this sense in the phrase "a sporting man", or in a pejorative sense, and some note that the word is used in this sense only when the gambling or betting activities pertain to sports. Based on this survey of dictionary definitions, as well as the fact that "gambling" does not fall within the meaning of the Spanish and French words that correspond to "sporting", namely "d�portivos" and "sportifs"194, the Panel made its finding that "the ordinary meaning of 'sporting' does not include gambling".195 166. We have three reservations about the way in which the Panel determined the ordinary meaning of the word "sporting" in the United States' Schedule. First, to the extent that the Panel's reasoning simply equates the "ordinary meaning" with the meaning of words as defined in dictionaries, this is, in our view, too mechanical an approach. Secondly, the Panel failed to have due regard to the fact that its recourse to dictionaries revealed that gambling and betting can, at least in some contexts, be one of the meanings of the word "sporting". Thirdly, the Panel failed to explain the basis for its recourse to the meanings of the French and Spanish words "d�portivos" and "sportifs" in the light of the fact that the United States' Schedule explicitly states, in a cover note, that it "is authentic in English only."196 167. Overall, the Panel's finding concerning the word "sporting" was premature. In our view, the Panel should have taken note that, in the abstract, the range of possible meanings of the word "sporting" includes both the meaning claimed by Antigua and the meaning claimed by the United States, and then continued its inquiry into which of those meanings was to be attributed to the word as used in the United States' GATS Schedule. 168. Nevertheless, even accepting that the Panel erred in reaching a conclusion regarding the meaning of "sporting" at such an early stage of its analysis, this alone is not decisive of the United States' appeal. This is because the Panel did not end its analysis once it had considered the dictionary definitions of "sporting". Rather, having found that the word "sporting" did not include gambling and betting services, it examined whether other words in Sector 10 of the United States' Schedule did serve to make a specific commitment on gambling and betting services. To do so, the Panel turned to the terms "recreational services" and "entertainment services". Beginning again with dictionary definitions, the Panel observed that "words such as 'recreational' and 'entertainment' could cover virtually the same types of services activities".197 The Panel expressed its view that "gambling and betting have, a priori, the characteristics of being entertaining or amusing, or of being used as a form of recreation."198 Having thus consulted dictionaries for "the words 'Other recreational services (except sporting)' and 'entertainment services'", the Panel observed that these left "a number of questions open" and did not "allow it to reach a definitive conclusion on whether or not the US Schedule includes specific commitments on 'gambling and betting services' in sector 10".199 The Panel then turned to consider the context in which the relevant terms from sector 10 of the United States' Schedule are situated. 169. The United States contests the Panel's identification and use of relevant context for the interpretation of the commitment made by the United States in its Schedule. In particular, the United States argues that the Panel erred in treating two documents from the Uruguay Round of trade negotiations, namely W/120 and the 1993 Scheduling Guidelines, as relevant context within the meaning of Article 31(2) of the Vienna Convention. 170. The Panel found that:
171. Before turning to the specifics of the United States' appeal, we observe that the second paragraph of Article 31 of the Vienna Convention defines "context" as follows:
172. We also consider it useful to set out, briefly, the nature of the two documents at issue. On 10 July 1991, the GATT Secretariat circulated document W/120, entitled "SERVICES SECTORAL CLASSIFICATION LIST". This followed the circulation of an informal note containing a draft services sectoral classification list in May 1991, as well as the circulation of an initial reference list of sectors (the "W/50") in April 1989.201 A short cover note to W/120 explains that the document reflects, to the extent possible, comments made by negotiating parties on the May draft, and that W/120 itself might be subject to future modification. Otherwise, the document consists of a table in two columns. The left column is entitled "SECTORS AND SUBSECTORS" and consists of a list classifying services into 11 broad service sectors, each divided into several subsectors (more than 150 in total). The right column is entitled "CORRESPONDING CPC" and sets out, for nearly every subsector listed in the left-hand column, a CPC number to which that subsector corresponds. It is not disputed that the reference in W/120 to "CPC" is a reference to the United Nations' Provisional Central Product Classification.202 The CPC is a detailed, multi-level classification of goods and services.203 The CPC is exhaustive (all goods and services are covered) and its categories are mutually exclusive (a given good or service may only be classified in one CPC category).204 The CPC consists of "Sections" (10), "Divisions" (69), "Groups" (295), "Classes" (1,050) and "Subclasses" (1,811). Of the 10 "Sections" of the CPC, the first five primarily classify products. They are based on the Harmonised Commodity Description and Coding System, and are not referred to in W/120. The second five Sections of the CPC primarily classify services, and all of the references in W/120 are to sub-categories of these five Sections. 173. On 3 September 1993 , the GATT Secretariat, in response to requests by the negotiating parties, circulated an "Explanatory Note" designed to "assist in the preparation of offers, requests, and national Schedules of commitments" and to ensure "comparable and unambiguous commitments" and achieve "precision and clarity".205 This document, known as the "1993 Scheduling Guidelines", addresses two main questions: (i) what items should be put in a Schedule; and (ii) how they should be entered. In addressing these questions, the Guidelines provide examples as to the types of measures that should be scheduled or need not be scheduled, and cover a variety of issues, including the scope of coverage under each mode of supply, and the relationship between different modes when making commitments on market access. The document also instructs Members as to the language to use when making a specific commitment,206 and includes a template indicating the overall structure, and columns and rows that should constitute a Member's Schedule. 174. Bearing the above in mind, we see two main difficulties with the Panel's characterization of these documents as context. First, we see no basis for the Panel's finding that they "constitute an agreement made between all the parties or an instrument[] made between some parties and accepted by the others as such".207 To reach this finding, the Panel reasoned that, although the documents were "technically" drafted by the GATT Secretariat:
175. We note that Article 31(2) refers to the agreement or acceptance of the parties. In this case, both W/120 and the 1993 Scheduling Guidelines were drafted by the GATT Secretariat rather than the parties to the negotiations. It may be true that, on its own, authorship by a delegated body would not preclude specific documents209 from falling within the scope of Article 31(2). However, we are not persuaded that in this case the Panel could find W/120 and the 1993 Scheduling Guidelines to be context. Such documents can be characterized as context only where there is sufficient evidence of their constituting an "agreement relating to the treaty" between the parties or of their "accept[ance by the parties] as an instrument related to the treaty". 176. We do not accept, as the Panel appears to have done, that, simply by requesting the preparation and circulation of these documents and using them in preparing their offers, the parties in the negotiations have accepted them as agreements or instruments related to the treaty. Indeed, there are indications to the contrary. As the United States pointed out before the Panel, the United States and several other parties to the negotiations clearly stated, at the time W/120 was proposed, that, although Members were encouraged to follow the broad structure of W/120, it was never meant to bind Members to the CPC definitions, nor to any other "specific nomenclature", and that "the composition of the list was not a matter for negotiations".210 Similarly, the Explanatory Note that prefaces the Scheduling Guidelines itself appears to contradict the Panel in this regard, as it expressly provides that, although it is intended to assist "persons responsible for scheduling commitments", that assistance "should not be considered as an authoritative legal interpretation of the GATS."211 177. The Panel also reasoned that:
In our opinion, the Panel's description of how these documents were created and used may suggest that the parties agreed to use such documents in the negotiations of their specific commitments. The Panel cited no evidence, however, directly supporting its further conclusion, in the quotation above, that the agreement of the parties encompassed an agreement to use the documents "as interpretative tools in the interpretation and application of Members' scheduled commitments." 178. In our opinion, therefore, the Panel erred in categorizing W/120 and the 1993 Scheduling Guidelines as "context" for the interpretation of the United States' GATS Schedule. Accordingly, we set aside this part of the Panel's examination of "context". There is, however, additional context referred to by the Panel and the participants that we must consider, namely: (i) the remainder of the United States' Schedule of specific commitments; (ii) the substantive provisions of the GATS; (iii) the provisions of covered agreements other than the GATS; and (iv) the GATS Schedules of other Members. 179. We begin by examining the immediate context in which the relevant entry is found, that is, the United States' Schedule as a whole. The United States admits that it "generally followed the W/120 structure in its Schedule of specific commitments."213 The Schedule makes no reference to CPC codes. The Schedule does, however, refer to W/120 in two instances214, apparently in order to make clear that the United States' commitment corresponds to only part of a subsector listed in W/120. This suggests that, at least for some of its entries, the United States also expressly referred to W/120 in order to define the content of a Schedule entry and, thereby, limit the scope of its specific commitment.215 At the same time, the context provided by the United States' Schedule as a whole does not indicate clearly the scope of the commitment in subsector 10.D. 180. We move, therefore, to examine the context provided by the structure of the GATS itself. The agreement defines "services" very broadly, as including "any service in any sector except services supplied in the exercise of governmental authority".216 In addition, the GATS definition of "sector" provides that any reference to a "sector" means�unless otherwise specified in a Member's Schedule�a reference to all of the subsectors contained within that sector.217 Many of the obligations in the GATS apply only in sectors in which a Member has undertaken specific commitments.218 To us, the structure of the GATS necessarily implies two things. First, because the GATS covers all services except those supplied in the exercise of governmental authority, it follows that a Member may schedule a specific commitment in respect of any service. Secondly, because a Member's obligations regarding a particular service depend on the specific commitments that it has made with respect to the sector or subsector within which that service falls, a specific service cannot fall within two different sectors or subsectors. In other words, the sectors and subsectors in a Member's Schedule must be mutually exclusive.219 In the context of the United States' Schedule, this means that, notwithstanding the broad language used in sector 10�for example, "recreational services", "sporting", and "entertainment services"�, gambling and betting services can only fall�if at all�within one of those service categories. 181. Looking beyond the GATS to other covered agreements, we observe that Article 22.3(f) of the DSU provides that, for purposes of suspending concessions, "'sector' means ....(ii) with respect to services, a principal sector as identified in the current 'Services Sectoral Classification List' which identifies such sectors". A footnote adds that "[t]he list in document MTN.GNS/W/120 identifies eleven sectors." This reference confirms the relevance of W/120 to the task of identifying service sectors in GATS Schedules, but does not appear to assist in the task of ascertaining within which subsector of a Member's Schedule a specific service falls. 182. Both participants220, as well as the Panel, accepted that other Members' Schedules constitute relevant context for the interpretation of subsector 10.D of the United States' Schedule.221 As the Panel pointed out, this is the logical consequence of Article XX:3 of the GATS, which provides that Members' Schedules are "an integral part" of the GATS. We agree. At the same time, as the Panel rightly acknowledged, use of other Members' Schedules as context must be tempered by the recognition that "[e]ach Schedule has its own intrinsic logic, which is different from the US Schedule."222 183. The United States relies on the Schedules of other Members as context seeking to establish that: (i) because many Members refer to CPC codes in their Schedules but the United States does not, the United States' Schedule cannot be "presumed" to follow the CPC; and (ii) scheduling gambling and betting services in subsector 10.E (rather than 10.D) was one of several accepted approaches used by Members.223 We are not persuaded that the conclusions the United States argues must be drawn from this context necessarily follow. It is true that a large majority of Members used CPC codes in their Schedules. It is also true that the United States did not use them.224 However, the United States' Schedule, like the Schedules of nearly all Members, generally follows the structure, and adopts the language, of W/120.225 These structural and linguistic similarities lead us to conclude, contrary to the United States submission, that the absence of references to CPC codes does not mean that words used in the United States' Schedule must have a different meaning and scope than the same words used in the Schedules of other Members. 184. We also note that, unlike the United States, several Members specifically used the words "gambling and betting services", or some approximation thereof, in their Schedules.226 The fact that the United States did not use any such specific language tends, if anything, to undercut its assertion that it intended to single out such services for exclusion from the scope of its commitment. Whether or not they used the term "gambling and betting services" in their Schedules, several Members also made clear, through reference to CPC codes, that they were making a commitment in respect of "sporting services" and that the services falling within the category "sporting services" did not include gambling and betting services.227 Moreover, the United States did not point to any example in another Member's Schedule where the category of "sporting services" clearly included gambling and betting services. 185. We also find unpersuasive the arguments of the United States with respect to subsector 10.E, "Other".228 Only one Member clearly scheduled gambling and betting services in subsector 10.E, and it used specific words to do so.229 Another Member specifically excluded "gambling and gambling related services" from the scope of its commitment under subsector 10.A.230 From these examples it appears that different Members have dealt with gambling and betting services in different subsectors of their Schedules. But the examples also suggest that Members have used specific language in order to make clear the location of their commitments within their own Schedules. Furthermore, as the Panel noted231, the United States' argument that gambling and betting services fall under subsector 10.E appears to contradict its argument that gambling and betting services are comprised in the ordinary meaning of "sporting services" under subsector 10.D. As we have observed above, the same service cannot be covered in two different subsectors within the same Schedule.232 186. Overall, we find it significant that the entries made by many Members in sector 10 of their Schedules contain text additional to the text found in the headings and sub-headings used by the United States (and used in W/120). Such Members disaggregated their entries beyond the five subsectors identified in W/120 as falling within sector 10. There is a broad range of ways in which this was accomplished. Some Members used CPC codes with more digits than the codes used in W/120, (that is, indicating a more disaggregated service category) and some used (either in addition to the CPC codes or alone) precise wording to indicate that gambling and betting services were somehow treated differently from other services in subsector 10.D. Several Members used CPC codes to distinguish commitments with respect to sporting services from commitments with respect to gambling and betting services. This context indicates that Members seeking to distinguish the commitments they were making regarding gambling and betting services from other commitments they were making in subsector 10.D used specific language and/or CPC codes to indicate this distinction. This context does not, however, provide a definitive answer to the question whether, in the United States' Schedule, gambling and betting services fall within the ordinary meaning of the word "sporting", within the ordinary meaning of the term "other recreational services", or elsewhere. 187. The above examination leads us to the view that an examination of the term "Other recreational services (except sporting)" in its context does not clearly reveal whether, in the United States' Schedule to the GATS, gambling and betting services fall within the category of "other recreational services" or within the category of "sporting services". Accordingly, we turn to the object and purpose of the GATS to obtain further guidance for our interpretation. 188. The Panel referred to the requirement of "transparency" found in the preamble to the GATS, as supporting the need for precision and clarity in scheduling, and underlining the importance of having Schedules that are "readily understandable by all other WTO Members, as well as by services suppliers and consumers".233 The Panel also referred to the Appellate Body Report in EC � Computer Equipment as follows:
189. We agree with the Panel's characterization of these objectives, along with its suggestion that they reinforce the importance of Members' making clear commitments. Yet these considerations do not provide specific assistance for determining where, in the United States' Schedule, "gambling and betting services" fall. Accordingly, it is necessary to continue our analysis by examining other elements to be taken into account in interpreting treaty provisions. 190. In addition to context, the third paragraph of Article 31 of the Vienna Convention directs a treaty interpreter to take into account, inter alia, subsequent practice establishing the agreement of the parties regarding the interpretation of the treaty. Antigua argues that the "subsequent practice" of Members demonstrates that W/120 and the Scheduling Guidelines must be used to interpret the United States' GATS Schedule.235 Antigua asserts that such relevant subsequent practice is found in the 2001 Scheduling Guidelines236, in a submission made by the United States regarding the classification of energy services237, as well as in a publication by the United States International Trade Commission ("USITC").238 The Panel did not reach these arguments by Antigua as it had found W/120 and the 1993 Scheduling Guidelines to be context. 191. In Japan � Alcoholic Beverages II and Chile � Price Band System, respectively, the Appellate Body referred to "practice" within the meaning of Article 31(3)(b) as:
192. Thus, in order for "practice" within the meaning of Article 31(3)(b) to be established: (i) there must be a common, consistent, discernible pattern of acts or pronouncements; and (ii) those acts or pronouncements must imply agreement on the interpretation of the relevant provision. 193. We have difficulty accepting Antigua's position that the 2001 Scheduling Guidelines constitute "subsequent practice" revealing a common understanding that Members' specific commitments are to be construed in accordance with W/120 and the 1993 Scheduling Guidelines. Although the 2001 Guidelines were explicitly adopted by the Council for Trade in Services, this was in the context of the negotiation of future commitments and in order to assist in the preparation of offers and requests in respect of such commitments. As such, they do not constitute evidence of Members' understanding regarding the interpretation of existing commitments. Furthermore, as the United States emphasized before the Panel, in its Decision adopting the 2001 Guidelines, the Council for Trade in Services explicitly stated that they were to be "non-binding" and "shall not modify any rights or obligations of the Members under the GATS".241 Accordingly, we do not consider that the 2001 Guidelines, in and of themselves, constitute "subsequent practice" within the meaning of Article 31(3)(b) of the Vienna Convention. 194. Nor do the two other documents relied on by Antigua constitute "subsequent practice". Although they may be relevant in identifying the United States' practice, they do not establish a common, consistent, discernible pattern of acts or pronouncements by Members as a whole. Nor do they demonstrate a common understanding among Members that specific commitments are to be interpreted by reference to W/120 and the 1993 Scheduling Guidelines. Accordingly, we do not find that Antigua has identified any relevant subsequent practice that can assist us in the interpretation of subsector 10.D of the United States' Schedule. 195. The above reasoning leads us to the conclusion�contrary
to the Panel242�that application of the general rule of interpretation set out in
Article 31 of the Vienna Convention leaves the meaning of "other
recreational services (except sporting)" ambiguous and does not answer the
question whether the commitment made by the United States in subsector 10.D of
its Schedule includes a commitment in respect of gambling and betting services.
Accordingly, we are required, in this case, to turn to the supplementary means
of interpretation provided for in Article 32 of the Vienna Convention.243
B. Interpretation of Subsector 10.D in Accordance with Supplementary Means of Interpretation: Article 32 of the Vienna Convention 196. We observe, as a preliminary matter, that this appeal does not raise the question whether W/120 and the 1993 Scheduling Guidelines constitute "supplementary means of interpretation, including the preparatory work of the treaty and the circumstances of its conclusion". Both participants agree that they do, and we see no reason to disagree.244 197. The United States argues, however, that, because the "ordinary meaning" of subsector 10.D of its Schedule is clear from an examination of the text, context (not including W/120 and the 1993 Scheduling Guidelines) and object and purpose, it is neither necessary nor appropriate to have recourse to Article 32 of the Vienna Convention. We disagree. As we have explained, the Panel erred in characterizing W/120 and the 1993 Scheduling Guidelines as "context". Yet, we have also seen that a proper interpretation pursuant to the principles codified in Article 31 of the Vienna Convention does not yield a clear meaning as to the scope of the commitment made by the United States in the entry "Other recreational services (except sporting)". Accordingly, it is appropriate to have recourse to the supplemental means of interpretation identified in Article 32 of the Vienna Convention. These means include W/120, the 1993 Scheduling Guidelines, and a cover note attached to drafts of the United States' Schedule. 198. Turning to the question of how the subsector 10.D entry "Other recreational services (except sporting)" is to be interpreted in the light of W/120 and the Scheduling Guidelines, we consider it useful to set out the relevant parts of both documents. The relevant section of W/120 is as follows:
199. Thus, W/120 clearly indicates that its entry 10.D�"Sporting and other recreational services"�corresponds to CPC Group 964. W/120 does not, however, contain any explicit indication of: (i) whether the reference to Group 964 necessarily incorporates a reference to each and every sub-category of Group 964 within the CPC; or (ii) how W/120 relates to the GATS Schedules of individual Members. 200. With respect to the first issue, we observe that W/120 sets out a much more aggregated classification list than the one found in the CPC. Whereas W/120 contains 12 sectors (11 and one "other") and more than 150 subsectors, the CPC classification scheme is comprised of 10 Sections, 69 Divisions, 295 Groups, 1,050 Classes and 1,811 Subclasses. The first draft classification list prepared by the GATT Secretariat, W/50, explained that one of the reasons for selecting the CPC as a basis for classification in the services negotiations was that such a product-based system "allows a higher degree of disaggregation and precision to be attained should it become necessary, at a later stage."245 Thus, the CPC's level of disaggregation was one of the very reasons it was selected as a basis for a sectoral classification list. As the CPC is a decimal system246, a reference to an aggregate category must be understood as a reference to all of the constituent parts of that category. Put differently, a reference to a three-digit CPC Group should, in the absence of any indication to the contrary, be understood as a reference to all the four-digit Classes and five-digit Sub-classes that make up the group; and a reference to a four-digit Class should be understood as a reference to all of the five-digit Sub-classes that make up that Class. 201. In the CPC, Group 964, which corresponds to subsector 10.D of W/120 (Sporting and other recreational services), is broken down into the following Classes and Sub-classes:
Thus, the CPC Class that corresponds to "Sporting services" (9641) does not include gambling and betting services. Rather, the Sub-class for gambling and betting services (96492) falls under the Class "Other recreational services" (9649). 202. W/120 does not shed light on the issue of how it relates to individual Member's Schedules. That issue is, however, addressed in the 1993 Scheduling Guidelines:
203. The Scheduling Guidelines thus underline the importance of using a common format and terminology in scheduling, and express a clear preference for parties to use W/120 and the CPC classifications in their Schedules. At the same time, the Guidelines make clear that parties wanting to use their own subsectoral classification or definitions�that is, to disaggregate in a way that diverges from W/120 and/or the CPC�were to do so in a "sufficiently detailed" way "to avoid any ambiguity as to the scope of the commitment." The example given in the Scheduling Guidelines illustrates how to make a positive commitment with respect to a discrete service that is more disaggregated than a service subsector identified in W/120. It is reasonable to assume that the parties to the negotiations expected the same technique to be applied to exclude a discrete service from the scope of a commitment, when the commitment is made in a subsector identified in W/120 and the excluded service is more disaggregated than that subsector. 204. In our view, the requisite clarity as to the scope of a commitment could not have been achieved through mere omission of CPC codes, particularly where a specific sector of a Member's Schedule, such as sector 10 of the United States' Schedule, follows the structure of W/120 in all other respects, and adopts precisely the same terminology as used in W/120. As discussed above, W/120 and the 1993 Scheduling Guidelines were prepared and circulated at the request of parties to the Uruguay Round negotiations for the express purpose of assisting those parties in the preparation of their offers. These documents undoubtedly served, too, to assist parties in reviewing and evaluating the offers made by others. They provided a common language and structure which, although not obligatory, was widely used and relied upon. In such circumstances, and in the light of the specific guidance provided in the 1993 Scheduling Guidelines, it is reasonable to assume that parties to the negotiations examining a sector of a Schedule that tracked so closely the language of the same sector in W/120 would�absent a clear indication to the contrary�have expected the sector to have the same coverage as the corresponding W/120 sector. This is another way of stating that, as the Panel observed, "unless otherwise indicated in the Schedule, Members were assumed to have relied on W/120 and the corresponding CPC references."247 205. Accordingly, the above excerpt from the 1993 Scheduling Guidelines, together with the linguistic similarities between the two subsectors, provide strong support for interpreting subsector 10.D of the United States' Schedule as corresponding to subsector 10.D of W/120, notwithstanding the absence of CPC codes in the United States' Schedule. Subsector 10.D of W/120, in turn, corresponds to Class 964 of CPC, along with its sub-categories. 206. We observe that another element of the preparatory work of the GATS suggests that the United States itself understood the Scheduling Guidelines in this way and sought to comply with them in the drafting of its GATS Schedule. Several drafts of the United States' Schedule included the following cover note:
207. These explanatory notes confirm that the United States used W/120 and sought to follow the 1993 Scheduling Guidelines. Although the United States emphasizes that this note did not form part of the final version of the United States' GATS Schedule, the reasons why the note was omitted are unclear249 and, in any event, the commitment made by the United States in subsector 10.D remained the same in the drafts that had this cover note and in the final version of the Schedule. In other words, the other parties to the negotiations could not have been expected to understand that the mere omission of the cover note from the final version of the United States' Schedule somehow modified the scope of the commitment undertaken in Sector 10. 208. In our view, therefore, the relevant entry in the United States' Schedule, "Other recreational services (except sporting)", must be interpreted as excluding from the scope of its specific commitment services corresponding to CPC class 9641, "Sporting services". For the same reasons, the entry must be read as including within the scope of its commitment services corresponding to CPC 9649, "Other recreational services", including Sub-class 96492, "Gambling and betting services". 209. Finally, we consider briefly the United States' challenge to the Panel's use, in interpreting the United States' Schedule, of a document published by the USITC. The United States submits that the Panel's reliance on this document "reflects a misguided and erroneous attempt to exaggerate the importance of a document that has no relevance under the customary rules of interpretation of international law".250 210. The Office of the United States Trade Representative delegated to the USITC responsibility for maintaining and updating, as necessary, the United States' Schedule. In 1997, the USITC published an explanatory text that, inter alia, explained the relationship between United States' Schedule entries and the CPC. One stated purpose of the document is to clarify "how the service sectors referenced in the GATT Secretariat's list, the CPC System, and the U.S. Schedule correspond".251 The table of concordance set out in that document clearly indicates that subsector 10.D of the United States' Schedule "corresponds" to CPC 964.252 211. The Panel did not explain clearly how it used this document in interpreting the United States' Schedule. The Panel considered that, although the USITC Document did not constitute a "binding interpretation", it nevertheless "has probative value as to how the US government views the structure and the scope of the US Schedule, and, hence, its GATS obligations."253 The document was dealt with under the heading "Other supplementary means of interpretation". In this context, the Panel observed that "Article 32 of the Vienna Convention is not necessarily limited to preparatory material, but may allow treaty interpreters to take into consideration other relevant material".254 Yet the Panel also referred to the principle of "acquiescence" and to a commentator's statement that "Article 31:3(b) [of the Vienna Convention] might also apply".255 Notwithstanding these ambiguities, it is clear from the Panel's reasoning that it used the USITC publication to "confirm" its interpretation of subsector 10.D in the United States' Schedule.256 In other words, the Panel's interpretation did not depend on its treatment of the USITC document. 212. We have already determined that the Panel committed certain errors in interpreting the United States' Schedule. Nevertheless, we have determined that a proper interpretation according to the principles codified in Articles 31 and 32 of the Vienna Convention leads to the same result that the Panel reached, namely, that subsector 10.D of the United States' GATS Schedule includes a specific commitment with respect to gambling and betting services. In the light of this finding, we need not decide whether the Panel erred in its treatment of the USITC Document.
213. Based on our reasoning above, we reject the United States' argument that, by excluding "sporting" services from the scope of its commitment in subsector 10.D, the United States excluded gambling and betting services from the scope of that commitment. Accordingly, we uphold, albeit for different reasons, the Panel's finding, in paragraph 7.2(a) of the Panel Report, that:
VI. Article XVI of the GATS: Market Access 214. Article XVI of the GATS sets out specific obligations for Members that apply insofar as a Member has undertaken "specific market access commitments" in its Schedule. The first paragraph of Article XVI obliges Members to accord services and service suppliers of other Members "no less favourable treatment than that provided for under the terms, limitations and conditions agreed and specified in its Schedule." The second paragraph of Article XVI defines, in six sub-paragraphs, measures that a Member, having undertaken a specific commitment, is not to adopt or maintain, "unless otherwise specified in its Schedule". The first four sub-paragraphs concern quantitative limitations on market access; the fifth sub-paragraph covers measures that restrict or require specific types of legal entity or joint venture through which a service supplier may supply a service; and the sixth sub-paragraph identifies limitations on the participation of foreign capital. 215. The Panel found that the United States' Schedule includes specific commitments on gambling and betting services, and we have upheld this finding. The Panel then considered the consistency of the measures at issue with the United States' obligations under Article XVI of the GATS. The scope of those obligations depends on the scope of the specific commitment made in the United States' Schedule. In this case, the relevant entry for mode 1 supply in the market access column of subsector 10.D of the United States' Schedule reads "None".257 In other words, the United States has undertaken to provide full market access, within the meaning of Article XVI, in respect of the services included within the scope of its subsector 10.D commitment. In so doing, it has committed not to maintain any of the types of measures listed in the six sub-paragraphs of Article XVI:2. 216. Before the Panel, Antigua claimed that, in maintaining measures that prohibit the cross-border supply of gambling and betting services, the United States is maintaining quantitative limitations that fall within the scope of sub-paragraphs (a) and (c) of Article XVI and that are, therefore, inconsistent with the market access commitment undertaken in subsector 10.D of the United States' Schedule. The Panel took the view that a prohibition on the supply of certain services effectively "limits to zero" the number of service suppliers and number of service operations relating to that service. The Panel reasoned that such a prohibition results in a "zero quota" and, therefore, constitutes a "'limitation on the number of service suppliers in the form of numerical quotas' within the meaning of Article XVI:2(a)" and "a limitation 'on the total number of service operations or on the total quantity of service output ... in the form of quotas' within the meaning of Article XVI:2(c)".258 217. In consequence, the Panel found that, by maintaining the following measures, the United States acts inconsistently with its obligations under Article XVI of the GATS:
218. The United States appeals both the Panel's interpretation of sub-paragraphs (a) and (c) of Article XVI, as well as its application of those provisions to the measures at issue. We have already determined that the Panel should not have made findings under Article XVI with respect to certain state laws because Antigua had not made out a prima facie case in respect of these measures. Having already reversed the Panel's findings regarding these state laws260, we need not consider them further in our assessment of this part of the United States' appeal. Accordingly, our analysis below is limited to a review of the Panel's interpretation of sub-paragraphs (a) and (c) of Article XVI:2, as well as to its application of that interpretation to the three federal statutes at issue in this case. 219. We also note that the Notice of Appeal filed by the United States appears to indicate a separate, independent challenge to:
220. The United States did not, however, adduce any arguments
in support of such a challenge in its appellant's submission. Nor did the United
States expressly refer to, or request us to reverse, any
221. The chapeau to Article XVI:2, and sub-paragraphs (a) and (c), provide:
9 Subparagraph 2(c) does not cover measures of a Member which limit inputs for the supply of services. 222. In its appeal, the United States emphasizes that none of the measures at issue states any numerical units or is in the form of quotas and that, therefore, none of those measures falls within the scope of sub-paragraph (a) or (c) of Article XVI:2. The United States contends that the Panel erred in its interpretation of sub-paragraphs (a) and (c) of Article XVI:2 by failing to give effect to certain elements of the text of these provisions, notably to key terms such as "form" and "numerical quotas". According to the United States, the Panel appears to have been influenced by a "misguided"264 concern that prohibitions on foreign service suppliers should not escape the application of Article XVI simply because they are not expressed in numerical terms. The United States asserts that the Panel ignored the fact that such prohibitions remain subject to other provisions of the Agreement, including Articles XVII and VI, and contends that, in its approach, the Panel improperly expanded the obligations in Article XVI. For the United States, Members that have made a specific commitment under Article XVI have committed themselves not to maintain the precisely defined limitations set out in Article XVI:2; Members have not committed themselves to eliminate all other limitations or restrictions that may impede the supply of the relevant services. 223. In interpreting sub-paragraph (a) of Article XVI:2, the Panel determined that:
224. The United States submits that this interpretation ignores the text of sub-paragraph (a), in particular the meaning of "form" and "numerical quotas", and erroneously includes within the scope of Article XVI:2(a) measures that have the effect of limiting the number of service suppliers or output to zero. Although the Panel opined that any other result would be "absurd", the United States stresses the opposite�that a contrary result would be consistent with the balance between liberalization and the right to regulate that is reflected in the GATS. 225. Article XVI:2(a) prohibits "limitations on the number of service suppliers whether in the form of numerical quotas, monopolies, exclusive service suppliers or the requirements of an economic needs test." In interpreting this provision we observe, first, that it refers to restrictions "on the number of service suppliers", as well as to "numerical quotas". These words reflect that the focus of Article XVI:2(a) is on limitations relating to numbers or, put differently, to quantitative limitations. 226. The United States urges us to give proper effect to the terms "in the form of" in sub-paragraph (a) and, to that end, refers to dictionary definitions to establish the meaning of "form" in Article XIV(a). Yet even these definitions suggest a degree of ambiguity as to the scope of the word "form". For example, "form" covers both the mode in which a thing "exists", as well as the mode in which it "manifests itself". This suggests a broad meaning for the term "form".266 227. The words "in the form of" in sub-paragraph (a) relate to all four of the limitations identified in that provision. It follows, in our view, that the four types of limitations, themselves, impart meaning to "in the form of". Looking at these four types of limitations in Article XVI:2(a), we begin with "numerical quotas". These words are not defined in the GATS. According to the dictionary definitions provided by the United States, the meaning of the word "numerical" includes "characteristic of a number or numbers".267 The word "quota" means, inter alia, "the maximum number or quantity belonging, due, given, or permitted to an individual or group"; and "numerical limitations on imports or exports".268 Thus, a "numerical quota" within Article XVI:2(a) appears to mean a quantitative limit on the number of service suppliers. The fact that the word "numerical" encompasses things which "have the characteristics of a number" suggests that limitations "in the form of a numerical quota" would encompass limitations which, even if not in themselves a number, have the characteristics of a number. Because zero is quantitative in nature, it can, in our view, be deemed to have the "characteristics of" a number�that is, to be "numerical". 228. The second type of limitation mentioned in sub-paragraph (a) is "limitations on the number of service suppliers... in the form of ... monopolies". Although the word "monopolies", as such, is not defined, Article XXVIII(h) of the GATS defines a "monopoly supplier of a service" as:
229. The term "exclusive service suppliers", which is used to identify the third limitation in Article XVI:2(a) ("limitations on the number of service suppliers...in the form of exclusive service suppliers"), is defined in Article VIII:5 of the GATS, as:
230. These two definitions suggest that the reference, in Article XVI:2(a), to limitations on the number of service suppliers "in the form of monopolies and exclusive service suppliers" should be read to include limitations that are in form or in effect, monopolies or exclusive service suppliers. 231. We further observe that it is not clear that "limitations on the number of service suppliers ... in the form of ... the requirements of an economic needs test" must take a particular "form."269 Thus, this fourth type of limitation, too, suggests that the words "in the form of" must not be interpreted as prescribing a rigid mechanical formula. 232. This is not to say that the words "in the form of" should be ignored or replaced by the words "that have the effect of". Yet, at the same time, they cannot be read in isolation. Rather, when viewed as a whole, the text of sub-paragraph (a) supports the view that the words "in the form of" must be read in conjunction with the words that precede them�"limitations on the number of service suppliers"�as well as the words that follow them, including the words "numerical quotas". (emphasis added) Read in this way, it is clear that the thrust of sub-paragraph (a) is not on the form of limitations, but on their numerical, or quantitative, nature. 233. Looking to the context of sub-paragraph (a), we observe that the chapeau to Article XVI:2, refers to the purpose of the sub-paragraphs that follow, namely, to define the measures which a Member shall not maintain or adopt for sectors where market access commitments are made. The chapeau thus contemplates circumstances in which a Member's Schedule includes a commitment to allow market access, and points out that the function of the sub-paragraphs in Article XVI:2 is to define certain limitations that are prohibited unless specifically entered in the Member's Schedule. Plainly, the drafters of sub-paragraph (a) had in mind limitations that would impose a maximum limit of above zero. Similarly, Article II:1(b) of the GATT 1994 prohibits Members from imposing duties "in excess of" the bound duty rate. Such bound duty rate will usually be above zero. Yet this does not mean that Article II:1(b) does not also refer to bound rates set at zero. 234. It follows from the above that we find the following reasoning of the Panel to be persuasive:
235. As for the first paragraph of Article XVI, we note that it does not refer expressly to any requirements as to form, but simply links a Member's market access obligations in respect of scheduled services to "the terms, limitations and conditions agreed and specified in its Schedule". Neither this provision, nor the object and purpose of the GATS as stated in its preamble271, readily assists us in answering the question whether the reference in Article XVI:2(a) to "limitations on the number of service suppliers ... in the form of numerical quotas" encompasses the type of measure at issue here, namely, a prohibition on the supply of a service in respect of which a specific commitment has been made. 236. In our view, the above examination of the words of Article XVI:2(a) read in their context and in the light of the object and purpose of the GATS suggests that the words "in the form of" do not impose the type of precisely defined constraint that the United States suggests. Yet certain ambiguities about the meaning of the provision remain. The Panel, at this stage of its analysis, observed that any suggestion that the "form" requirement must be strictly interpreted to refer only to limitations "explicitly couched in numerical terms" leads to "absurdity".272 In either circumstance, this is an appropriate case in which to have recourse to supplementary means of interpretation, such as preparatory work. 237. We have already determined that the 1993 Scheduling Guidelines constitute relevant preparatory work.273 As the Panel observed, those Guidelines set out an example of the type of limitation that falls within the scope of sub-paragraph (a) of Article XVI:2, that is, of the type of measures that will be inconsistent with Article XVI if a relevant commitment has been made and unless the Member in question has listed it as a condition or limitation in its Schedule. That example is: "nationality requirements for suppliers of services (equivalent to zero quota)".274 This example confirms the view that measures equivalent to a zero quota fall within the scope of Article XVI:2(a). 238. For the above reasons, we are of the view that limitations amounting to a zero quota are quantitative limitations and fall within the scope of Article XVI:2(a). 239. As we have not been asked to revisit the other elements of the Panel's reasoning on this issue�in particular its findings regarding limitations on market access in respect of part of a committed sector275, and limitations on one or more means of cross-border delivery for a committed service276�we therefore, uphold the Panel's finding that:
240. In interpreting sub-paragraph (c) of Article XVI:2, the Panel observed that the wording of the provision "might perhaps be taken to imply that any quota has to be expressed in terms of designated numerical units".278 However, after further analysis and, in particular, after comparing the English version of the provision with its French and Spanish counterparts, the Panel found that sub-paragraph (c) does not mean that any quota must be expressed in terms of designated numerical units if it is to fall within the scope of that provision. Instead, according to the Panel, the "correct reading of Article XVI:2(c)" is that limitations referred to under that provision may be: (i) in the form of designated numerical units; (ii) in the form of quotas; or (iii) in the form of the requirement of an economic needs test.279 241. The Panel then found that, where a specific commitment has been undertaken in respect of a service, a measure prohibiting one or more means of delivery of that service is:
242. The United States asserts that, in so finding, the Panel used an incorrect reading of the French and Spanish texts to arrive at an interpretation that is inconsistent with the ordinary meaning of the English text. Specifically, the Panel relied upon the presence of commas in the French and Spanish versions of the text�but not in the English version�in order to find that sub-paragraph (c) identifies three types of limitations. The United States argues that, when properly interpreted, sub-paragraph (c) identifies only two types of limitations. The United States adds that the measures at issue in this case cannot in any way be construed as falling within the scope of either of the two limitations defined in sub-paragraph (c). 243. Sub-paragraph (c) refers to the following measures:
244. The Panel essentially determined that, notwithstanding the absence of a comma between "terms of designated numerical units" and "in the form of quotas" in the English version, the phrase should, in order to be read in a manner consistent with the French and Spanish versions, be read as if such a comma existed�that is, as if expressed in "terms of designated numerical units" and "in the form of quotas" were disjunctive phrases, each of which modifies the word "limitations" at the beginning of the provision.281 The Panel relied on the fact that such a comma does exist in both the French and Spanish versions of the provision. The United States argues, however, based on a detailed analysis of French grammar, that the existence of the comma in the French version is, in fact, consistent with the absence of a comma in the English version, and that both versions mean that Article XVI:2(c) identifies only two limitations.282 245. Ultimately, we are not persuaded that the key to the interpretation of this particular provision is to be found in a careful dissection of the use of commas within its grammatical structure. Regardless of which language version is analyzed, and of the implications of comma placement (or lack thereof), all three language versions are grammatically ambiguous. All three can arguably be read as identifying two limitations on the total number of service operations or on the total quantity of service output.283 All three can also arguably be read as identifying three limitations on the total number of service operations or on the total quantity of service output.284 The mere presence or absence of a comma in Article XVI:2(c) is not determinative of the issue before us. 246. We find it more useful, and appropriate, to look to the language of the provision itself for its meaning. Looking at the provision generally, we see that the first clause of sub-paragraph (c) deals with the target of the limitations covered by that provision. There are two such types of limitations: on the number of service operations; and on the quantity of service output. Both are quantitative in nature. The second part of the provision provides more detail as to the type of limitations�relating to those service operations or output�that fall within sub-paragraph (c). These are: "designated numerical units in the form of quotas or the requirement of an economic needs test". The second part of the provision clearly modifies the first part of the provision (service operations, service output). Yet certain elements of the second part apply differently to the two elements of the first part. For example, in its ordinary sense, the term "numerical units" is more naturally used to refer to "output" than to "operations". 247. In our view, by combining, in sub-paragraph (c), the elements of the first clause of Article XVI:2(c) and the elements in the second part of the provision, the parties to the negotiations sought to ensure that their provision covered certain types of limitations, but did not feel the need to clearly demarcate the scope of each such element. On the contrary, there is scope for overlap between such elements: between limitations on the number of service operations and limitations on the quantity of service output, for example, or between limitations in the form of quotas and limitations in the form of an economic needs test. That sub-paragraph (c) applies in respect of all four modes of supply under the GATS also suggests the limitations covered thereunder cannot take a single form, nor be constrained in a formulaic manner. Nonetheless, all types of limitations in sub-paragraph (c) are quantitative in nature, and all restrict market access. For these reasons, we are of the view that, even if sub-paragraph (c) is read as referring to only two types of limitations, as contended by the United States, it does not follow that sub-paragraph (c) would not catch a measure equivalent to a zero quota. 248. To the extent that the above interpretation leaves a degree of ambiguity as to the proper meaning of Article XVI:2(c), we consider it useful to resort to supplementary means of interpretation. The market access obligations set forth in Article XVI were intended to be obligations in respect of quantitative , or "quantitative-type"285, measures. The difficulties faced by the negotiating parties concerned not whether Article XVI covered quantitative measures�for it was clear that it did�but rather how to "know where the line should be drawn between quantitative and qualitative measures".286 249. We also consider it appropriate to refer to the 1993 Scheduling Guidelines as preparatory work. These Guidelines set out an example of the type of measure covered by sub-paragraph (c) of Article XVI:2. They refer to "[r]estrictions on broadcasting time available for foreign films"287, without mentioning numbers or units. 250. The strict interpretation of Article XVI:2(c) advanced by the United States would imply that only limitations that contain an express reference to numbered units could fall within the scope of that provision. Under such an interpretation, sub-paragraph (c) could not cover, for example, a limitation expressed as a percentage or described using words such as "a majority". It is neither necessary nor appropriate for us to draw, in the abstract, the line between quantitative and qualitative measures, and we do not do so here. Yet we are satisfied that a prohibition on the supply of services in respect of which a full market access commitment has been undertaken is a quantitative limitation on the supply of such services. 251. In this case, the measures at issue, by prohibiting the supply of services in respect of which a market access commitment has been taken, amount to a "zero quota" on service operations or output with respect to such services. As such, they fall within the scope of Article XVI:2(c). 252. For all of these reasons, we uphold the Panel's finding, in paragraph 6.355 of the Panel Report, that a measure prohibiting the supply of certain services where specific commitments have been undertaken is a limitation:
253. Antigua also appeals the Panel's findings that certain measures that prohibit consumers from purchasing cross-border gambling services are not caught by either sub-paragraph (a) or sub-paragraph (c) of Article XVI:2.288 The Panel applied its analysis of these provisions to find that four state laws directed at persons who engage in gambling�that is, to consumers of gambling services as opposed to suppliers of gambling services�had not been shown to be inconsistent with the United States' market access commitments.289 254. In paragraphs 149 to 155 of this Report, we expressed
our view that, with respect to the eight state laws reviewed by the Panel,
Antigua had failed to establish a prima facie case of
inconsistency with sub-paragraphs (a) and (c) of Article XVI:2. For this reason,
we reversed the Panel's findings that four of those state laws are inconsistent
with Article XVI:1 and sub-paragraphs (a) and (c) of Article XVI:2.290 Having held
that the Panel was not entitled to make findings on any of the
eight state laws, including with respect to the four state laws directed at consumers
rather than suppliers of gambling services, we need not, in
resolving this appeal, consider the merits of Antigua's appeal of the Panel's
findings with respect to restrictions on service consumers as opposed
to service suppliers.
C. Does the Second Paragraph of Article XVI Exhaust the Market Access Restrictions that are Prohibited by the First Paragraph? 255. The Panel found that:
256. Antigua conditionally appeals this finding. Its appeal is conditional upon the Appellate Body's reversing the finding of the Panel, in paragraph 7.2(b) of the Panel Report, that certain United States federal and state laws are contrary to Article XVI:1 and Article XVI:2 of the GATS. More specifically, the appeal is made "in the event the Appellate Body were to agree with the United States' argument that GATS Articles XVI:2(a) and (c) only apply to limitations that are in form specified exactly and expressly in terms of numerical quotas."292 Having upheld the Panel's interpretation of sub-paragraphs (a) and (c) of Article XVI:2 and dismissed this ground of the United States' appeal, it follows that the condition on which this aspect of Antigua's appeal is made is not satisfied, and we need not consider it further. We thus leave the issue of the relationship between the first and second paragraphs of Article XVI to another day.
134 Panel Report, para. 6.197 (citing Appellate Body Report, US � Corrosion-Resistant Steel Sunset Review, para. 97; Appellate Body Report, US � Carbon Steel, para. 157; and Appellate Body Report, US � Countervailing Measures on Certain EC Products, para. 162). 135 Ibid., para. 6.198. 136 United States' appellant's submission, para. 205. 137 Antigua's response to questioning at the oral hearing. 138 See also Appellate Body Report, US � Wool Shirts and Blouses, p. 17, DSR 1997:I, 323, at 338. 139 Indeed, this was said explicitly in paragraph 220 of the Appellate Body Report in US � Oil Country Tubular Goods Sunset Reviews. 140 See pages 3 to 7 of Antigua's Request for Establishment of a Panel, supra, footnote 114. 141 Panel Report, para. 6.209. 142 Ibid., para. 6.214. 143 Ibid., para. 6.216. 144 Ibid., para. 6.217. 145 Ibid., para. 6.223. 146 Ibid., paras. 6.226, 6.229, 6.232, 6.235, 6.239, 6.242, 6.245, and 6.248. 147 Appellate Body Report, Canada � Dairy (Article 21.5 � New Zealand and US II), para. 66. 148 Appellate Body Report, US � Carbon Steel, para. 157 (citing Appellate Body Report, US � Wool Shirts and Blouses, p. 14, DSR 1997:I, 323, at 335). 149 Appellate Body Report, EC � Hormones, para. 98; Appellate Body Report, US � Wool Shirts and Blouses, p. 14, DSR 1997:I, 323, at 335. 150 Appellate Body Report, Japan � Agricultural Products II, para. 129. 151 Appellate Body Report, US � Wool Shirts and Blouses, p. 16, DSR 1997:I, 323, at 336. (emphasis added) As not every claim of WTO-inconsistency will consist of the same elements, "the nature and scope of evidence required to establish a prima facie case 'will necessarily vary from measure to measure, provision to provision, and case to case'". (Appellate Body Report, Japan � Apples, para. 159 (quoting Appellate Body Report, US � Wool Shirts and Blouses, p. 14, DSR 1997:I, 323, at 335)) 152 In Canada � Wheat Exports and Grain Imports, para. 191, the Appellate Body made a similar observation in the context of an appeal under Article 11 of the DSU:
153 Appellate Body Report, US � Oil Country Tubular Goods Sunset Reviews, para. 162. 154 Panel Report, para. 6.171. 155 Supra, paras. 120-126. 156 Antigua's first written submission to the Panel, para. 181. 157 Ibid., paras. 160-163. 158 Supra, para. 143. 159 Antigua's second written submission to the Panel, para. 37. The footnotes omitted from this excerpt contain no reference to specific laws of the United States. 160 Antigua's statement at the first substantive panel meeting, para. 21, 10 December 2003; Antigua's written submission in response to the United States' request for preliminary rulings, footnote 18 to para. 18, 22 October 2003. See also Antigua's response to Question 12 posed by the Panel, Panel Report, p. C-36 (discussing prosecutions under the Wire Act and the Travel Act); and Exhibit AB-82 submitted by Antigua to the Panel (containing texts of the Wire Act, the Travel Act, and the IGBA). 161 United States General Accounting Office, Internet Gambling: An Overview of the Issues, p. 11 (December 2002), Exhibit AB-17 submitted by Antigua to the Panel (describing the Wire Act, the Travel Act, and the IGBA). 162 Letter from John G. Malcolm to National Association of Broadcasters, 11 June 2003, Exhibit AB-73 submitted by Antigua to the Panel. 163 Supra, para. 146. 164 United States' appellant's submission, para. 9. 165 Antigua's statement at the first substantive panel meeting, para. 21, 10 December 2003. In its opening statement at the first substantive panel meeting, Antigua discussed "three federal statutes", which it identified as follows:
166 Question 32 posed by the Panel to Antigua, Panel Report, p. C-58, where the Panel noted: "In its first oral statement (para. 21), in arguing that a prohibition on the cross-border supply of gambling and betting services exists, Antigua points to three federal laws, namely the Wire Act (18 USC � 1084), the Travel Act (18 USC � 1952) and the Illegal Gambling Business Act (18 USC � 1955)." 167 Two of the state measures considered by the Panel�Section 9 of Article 1 of the New York Constitution and Section 18-10-103 of the Colorado Revised Statutes�are mentioned by Antigua in its first written submission. (Antigua's first written submission, para. 149) However, they are mentioned solely for the purpose of supporting Antigua's assertion that the reason certain measures were identified in its panel request but not in its request for consultations was a typographical error. No description is given of the laws or how they might be inconsistent with Article XVI. 168 Supra, para. 146. 169 Antigua's second written submission to the Panel, para. 37 and footnotes 46-47 and 49 thereto (citing paras. 22-24 and 28-29 of the same submission). 170 See, for example, ibid., paras. 27-29 (discussing laws of, inter alia, Illinois, Iowa, and Nevada). 171 See, for example, ibid., para. 27. 172 See, for example, ibid., paras. 22 ("All states have adopted the same basic legal approach �.") and 24 ("under the laws or the practice of every state"). 173 Ibid., footnotes 22 and 23 to para. 22 (citing United States General Accounting Office, Internet Gambling: An Overview of the Issues (December 2002), Exhibit AB-17 submitted by Antigua to the Panel; and Antonia Z. Cowan, "The Global Gaming Village: Interstate and Transnational Gambling", Gambling Law Review, Vol. 7, pp. 255-257, Exhibit AB-119 submitted by Antigua to the Panel). 174 Panel Report, paras. 6.228 and 6.244. 175 Antigua's second written submission to the Panel, footnotes 46, 47, and 49 to para. 37 (citing Antigua's second written submission, paras. 22-24 and 27-29); and Antigua's second written submission, footnotes 22 and 23 to para. 22 (citing, inter alia, Enclosure 1 to the Interim Report of the United States General Accounting Office on Internet Gambling, entitled "Gambling Law in Five States and Their Effect on Internet Gambling" (23 September 2002), Exhibit AB-84 submitted by Antigua to the Panel). 176 United States appellant's submission, para. 39. 177 Supra, para. 154. 178 Panel Report, paras. 6.421, 6.535, 6.565, 7.2(b)(i), and 7.2(d). 179 Ibid., paras. 6.367 and 6.375. 180 See also Panel Report, para. 6.134. 181 United States' appellant's submission, para. 65. 182 Ibid., para. 75 (quoting Panel Report, paras. 6.104 and 6.106). 183 Appellate Body Report, EC � Computer Equipment, para. 109. 184 Ibid., para. 84. 185 Panel Report, para. 6.45. 186 Antigua's and the United States' responses to questioning at the oral hearing. 187 Panel Report, para. 6.41. 188 The United States of America � Schedule of Specific Commitments, GATS/SC/90, 15 April 1994 (the "United States' Schedule"). The "National Treatment" and "Additional Commitments" columns of the United States' Schedule are omitted from this excerpt. The relevant part of the United States' GATS Schedule is attached, in its entirety, as Annex III to this Report. 189 Panel Report, para. 6.47. 190 Ibid., para. 6.61. (original emphasis) 191 We note, in this regard, the words of the panel in US � Section 301 Trade Act:
192 Appellate Body Report, US � Softwood Lumber IV, para. 59; Appellate Body Report, Canada � Aircraft, para. 153; and Appellate Body Report, EC � Asbestos, para. 92. 193 The 13 different dictionary definitions consulted by the Panel are set out in paragraphs. 6.55-6.59 of the Panel Report. Some of the definitions appear to contradict one another. For instance, the Shorter Oxford English Dictionary definition quoted by the Panel defines "sporting" as both "characterized by sportsmanlike conduct"; and "[d]esignating an inferior sportsman or a person interested in sport from purely mercenary motives". (Panel Report, para. 6.55) 194 Panel Report, paras. 6.59-6.60. 195 Ibid., para. 6.61. (original emphasis) 196 The cover note is included in the excerpt from the United States' Schedule attached as Annex III to this Report. 197 Panel Report, para. 6.63. 198 Ibid., para. 6.66. 199 Ibid., para. 6.67. 200 Panel Report, para. 6.82. 201 MTN.GNS/W/50, 13 April 1989. 202 Provisional Central Product Classification, Statistical Papers, Series M No. 77, United Nations (1991). The United Nations Central Product Classification has been revised on several occasions. The latest version is the Central Product Classification, Version 1.1, Statistical Papers, Series M No. 77, United Nations (2004). 203 The main purposes of the CPC are to provide a framework for international comparison of statistics dealing with goods, services, and assets and to serve as a guide for developing and revising existing classification schemes of products. (Preface to the CPC, p. V) 204 See infra, paras. 200 and 201 for further details on the CPC, and for the way in which the CPC classifies the services at issue in this dispute. 205 Scheduling of Initial Commitments in Trade in Services: Explanatory Note, MTN.GNS/W/164, 3 September 1993, at p. 1. 206 For example, paragraphs 24 to 27 explain that: to indicate a full commitment, a Member should enter "NONE"; to make no commitment, it should enter "UNBOUND"; and to make a commitment with limitations, the Member should enter a concise description of each measure, "indicating the elements which make it inconsistent with Articles XVI or XVII". 207 Panel Report, para. 6.77. 208 Ibid., para. 6.80. 209 The Panel reasoned that assigning the task of drafting these documents to the Secretariat was simply "the most practical and efficient way to work on such a matter" and that such delegation did not deprive the parties to the negotiations of authorship. (Panel Report, para. 6.80) 210 Note on the Meeting of 27 May to 6 June 1991, MTN.GNS/42, para. 19 (24 June 1991) (quoted in Panel Report, para. 3.41 and footnote 117 thereto). The paragraphs of this Note cited by the United States are taken from the minutes from a meeting that was held after the Secretariat had circulated its first draft classification list, but before the final version of W/120 had been circulated. The content of those paragraphs is as follows:
211 1993 Scheduling Guidelines, p. 1. 212 Panel Report, para. 6.82. 213 United States' response to Question 5 posed by the Panel, Panel Report, p. C-26. (original emphasis) 214 Sector B of the Schedule is as follows "COMPUTER AND RELATED SERVICES (MTN.GNS/W/120 a) ‑ e), except airline computer reservation systems)"; and the entry in subsector F.r reads "Publishing (Only part of MTN.GNS/W/120 category: 'r) Printing, Publishing')". 215 The Panel made a similar point in paragraph 6.104 of the Panel Report and footnote 665 thereto. 216 GATS Article I:3(b). (emphasis added) 217 Article XXVIII provides that:
218 See, for example, Articles VI:1, VIII:1, XVI, and XVII of the GATS. 219 If this were not the case, and a Member scheduled the same service in two different sectors, then the scope of the Member's commitment would not be clear where, for example, it made a full commitment in one of those sectors and a limited, or no, commitment, in the other. At the oral hearing in this appeal, both the United States and Antigua agreed that the entries in a Member's Schedule must be mutually exclusive. See also Panel Report, paras. 6.63, 6.101, and 6.119. 220 Antigua's and United States' responses to questioning at the oral hearing. 221 In paragraph 6.97 of the Panel Report, the Panel stated that it agreed "with the United States that other Members' Schedules comprise the 'context' within the meaning of Article 31:2 of the Vienna Convention." 222 Panel Report, para. 6.98. By referring to other Members' Schedules here, we are not interpreting such Schedules, but rather using them as "context" for the interpretation of the United States' Schedule. 223 Before the Panel, the United States referred to the Schedules of Iceland and Senegal. (See footnote 106 to para. 74 of the United States' first written submission to the Panel) 224 The Panel observed, in an earlier discussion, that:
225 As we observed supra, para. 179, the United States admits that it generally followed the W/120 structure, and its Schedule specifically refers to W/120 in two instances. 226 In most instances, the words appear to be used to exclude these services from the scope of the commitment. See the Schedules of Austria (GATS/SC/7); Bulgaria (GATS/SC/122); Croatia (GATS/SC/130); the European Communities (GATS/SC/31); Finland (GATS/SC/33); Lithuania (GATS/SC/133); Slovenia (GATS/SC/99); and Sweden (GATS/SC/82). In two cases, however, the words appear to be used to make a limited specific commitment. See the Schedules of Peru (GATS/SC/69) and Senegal (GATS/SC/75). 227 See the Schedules of Australia (GATS/SC/6); Japan (GATS/SC/46); Liechtenstein (GATS/SC/83-A); Switzerland (GATS/SC/83); and Thailand (GATS/SC/85). 228 Although subsector 10.E, "Other", figures in W/120, no such entry is included in the United States' Schedule. 229 Senegal listed "Gambling and betting services" under 10.E. However, Senegal also appears to have made a relatively narrow commitment under 10.D, with respect to "Recreational Fishing" only. 230 See the Schedule of Bulgaria. (GATS/SC/122) 231 Panel Report, para. 6.101. 232 Supra, para. 180. 233 Panel Report, para. 6.107. 234 Ibid., para. 6.108. 235 Antigua's response to Question 1 posed by the Panel, Panel Report, pp. C-1 to C-3. 236 Guidelines for the Scheduling of Specific Commitments under the General Agreement on Trade in Services, S/L/92. The 2001 Scheduling Guidelines serve, in the current round of services negotiations, the same function as the 1993 Scheduling Guidelines served in the Uruguay Round negotiations. The former reproduce the 1993 Scheduling Guidelines almost in their entirety, and contain some additional provisions. The 2001 Scheduling Guidelines were adopted by the Council for Trade in Services on 23 March 2001. 237 Antigua referred to document S/CSC/W/27, a proposal submitted by the United States concerning the classification of energy services. (Antigua's first written submission to the Panel, footnote 301 to para. 173) Paragraph 2 of this document states that:
238 US Schedule of Commitments under the General Agreement on Trade in Services, United States International Trade Commission, May 1997, p. 25. 239 Appellate Body Report, Japan � Alcoholic Beverages II, p. 13, DSR 1996:I, 97, at 106. The Appellate Body, in that case, found that panel reports adopted by the GATT contracting parties do not constitute subsequent practice within the meaning of Article 31(3)(b) of the Vienna Convention. 240 Appellate Body Report, Chile � Price Band System, para. 214. 241 United States' response to Question 39 posed by the Panel, Panel Report, pp. C-63 to C-64. 242 The Panel concluded, at para. 6.110 of the Panel Report, that:
243 The Panel also had recourse to such means in order to "confirm" the meaning that it had reached through application of Article 31. (Panel Report, para. 6.112) 244 Some of the reasoning employed by the Panel in order to conclude (erroneously in our view) that these documents constituted "context" nevertheless confirms that they constitute "preparatory work", and are relevant "circumstances" relating to the conclusion of the GATS within the meaning of Article 32:
245 MTN.GNS/W/50, para. 6. (emphasis added) 246 The CPC hierarchy consists of Sections designated by one-digit codes, Divisions designated by two-digit codes, Groups designated by three-digit codes, Classes designated by four-digit codes, and Subclasses designated by five-digit codes. 247 Panel Report, para. 6.106. 248 Communication from the United States of America � Draft Final Schedule of the United States of America Concerning Initial Commitments, MTN.GNS/W/112/Rev.3, 7 December 1993. See also MTN.GNS/W/112/Rev.2, 1 October 1993. 249 Before the Panel, and at the oral hearing in this appeal, the European Communities explained that such notes were removed as part of the process of "technical verification" of schedules and that the United States could not have unilaterally amended the scope of its commitments after 15 December 1993. See the parties' responses to Question 3 posed by the Panel, Panel Report, pp. C-22ff. 250 United States' appellant's submission, para. 83. (original emphasis) 251 Panel Report, para. 6.132 (quoting from p.viii of the USITC document). (emphasis added by the Panel) The USITC document also explains, on the same page, that:
252 US Schedule of Commitments under the General Agreement on Trade in Services, United States International Trade Commission, May 1997, p. 25. 253 Panel Report, para. 6.133. 254 Ibid., para. 6.122. 255 Panel Report, para. 6.122 (referring in footnote to A. Aust, Modern Treaty Law and Practice, Cambridge University Press, 2000, p. 200). 256 Ibid., para. 6.133. 257 This notation is the opposite of the notation "Unbound", which means that a Member undertakes no specific commitment. 258 Panel Report, paras. 6.338 and 6.355. 259 See Panel Report, paras. 6.421 and 7.2(b). The Panel's findings that specific measures afforded treatment less favourable than that provided for in the United States' schedule are found in paragraphs 6.365, 6.373, 6.380, 6.389, 6.395, and 6.412. 260 Supra, paras. 154 and 155. 261 United States' Notice of Appeal, para. 3(c), supra, footnote 22. 262 We understand the relevant findings to be those in paragraphs 6.287 and 6.290 of the Panel Report. The Panel found that: (i) as regards a particular service, a Member that has made an unlimited market access commitment under mode 1 commits itself not to maintain measures that prohibit the use of one, several or all means of delivery of that service; and (ii) a Member that has made a market access commitment in a sector or subsector has committed itself in respect of all services that fall within the relevant sector or subsector. 263 In response to a question on this issue at the oral hearing, the United States stated that its arguments on these points are in the nature of "subsidiary" or "supporting" arguments. According to the United States, these arguments illustrate why the Panel's interpretation of sub-paragraphs (a) and (c) of Article XVI was "unreasonable". 264 United States' appellant's submission, para. 98. 265 Panel Report, para. 6.338. 266 In footnote 166 to paragraph 105 of its appellant's submission, the United States refers to "The New Shorter Oxford English Dictionary, p. 1006, which defines 'form' inter alia as 'shape, arrangement of parts,' or '[t]he particular mode in which a thing exists or manifests itself,' or, in linguistics, 'the external characteristics of a word or other unit as distinct from its meaning". 267 The United States, at footnote 167 to paragraph 105 of its appellant's submission, observes that the "New Shorter Oxford English Dictionary, at p. 1955, defines 'numerical' as '[o]f, pertaining to, or characteristic of a number or numbers; (of a figure, symbol, etc.) expressing a number.'" 268 The United States' appellant's submission, footnote 167 to para. 105 (referring to the New Shorter Oxford English Dictionary, p. 2454). 269 See the WTO Secretariat Note on "Economic Needs Tests", S/CSS/W/118, 30 November 2001, para. 4. 270 Panel Report, para. 6.331. 271 We recall that the Panel identified, as forming part of the object and purpose of the GATS: transparency, the progressive liberalization of trade in services, and Members' right to regulate trade in services provided that they respect the rights of other Members under the GATS. (Panel Report, paras. 6.107-6.109, and 6.314-6.317) 272 In paragraph 6.332 of the Panel Report, the Panel reasoned that:
273 Supra, para. 196. 274 See 1993 Scheduling Guidelines, para. 6. 275 Panel Report, para. 6.335. 276 Ibid., para. 6.338. 277 Ibid. 278 Ibid., para. 6.343. 279 Ibid., para. 6.344. 280 Ibid., para. 6.355. 281 The French version reads "limitations concernant le nombre total d'op�rations de services ou la quantit� totale de services produits, exprim�es en unit�s num�riques d�termin�es, sous forme de contingents ou de l'exigence d'un examen des besoins �conomiques"; and the Spanish version reads "limitaciones al n�mero total de operaciones de servicios o a la cuant�a total de la producci�n de servicios, expresadas en unidades num�ricas designadas, en forma de contingentes o mediante la exigencia de una prueba de necesidades econ�micas". 282 United States' appellant's submission, paras. 114-120. 283 That is: (i) limitations ... expressed in terms of designated numerical units in the form of quotas; or (ii) limitations ... expressed in terms of the requirement of an economic needs test. 284 That is: (i) limitations ... expressed in terms of designated numerical units; (ii) limitations ... expressed ... in the form of quotas; or (iii) limitations ... expressed in terms of the requirement of ... an economic needs test. 285 Statement by the Co-Chairman at the meeting of 17-27 September 1991, MTN.GNS/45, para. 16. 286 Ibid. 287 1993 Scheduling Guidelines, p. 3. 288 Panel Report, paras. 6.321 and 6.348-6.349. 289 Panel Report, paras. 6.382-6.383 (Colorado), 6.397-6.398 (Minnesota), 6.401-6.402 (New Jersey), and 6.405-6.406 (New York). 290 Supra, para. 155. 291 Panel Report, para. 6.318. See also paras. 6.298-6.299. 292 Antigua's other appellant's submission, footnote 3 to para. 3. See also Antigua's other appellant's submission, para. 55. |
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