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World Trade |
WT/DS18/R 12 June 1998 (98-2258) Original: English |
Australia - Measures Affecting Importation of SalmonReport of the Panel (Continued) 4.17 Canada stated that it had argued from the outset that Australia had violated Article 5.6 and that this violation was due in part to Australia's inability to distinguish among the risks entailed by various sanitary measure of differing trade restrictiveness (Canada's First Submission, paragraphs 224 to 227). These measures included heat treatment, the most trade restrictive of the measures identified in the Final Report and the one that Australia had chosen to maintain. The Terms of Reference made it clear that heat treatment had always been at issue in this case. The Panel had furthermore raised the issue of heat treatment and the other options identified in the Final Report in its Additional Question 13 to the Parties of 8 December 1997. 40 4.18 Regarding Australia's due process claims in general, Canada contended that Australia had confused the distinction, made clear by the Appellate Body, between claims and arguments. According to the Appellate Body in EC - Regime for the Importation, Sale and Distribution of Bananas: "... there is a significant difference between the claims identified in the request for the establishment of a panel, which establish the panel's terms of reference under Article 7 of the DSU, and the arguments supporting those claims, which are set out and progressively clarified in the first written submissions, the rebuttal submissions and the first and second panel meetings with the parties." 41 (emphasis in the original) 4.19 Hence, while claims had to be "specified sufficiently in the request for the establishment of a panel in order to allow the defending party ... to know the legal basis of the complaint" 42, the arguments in support of those claims were to be set out and refined in the course of the proceedings. The Appellate Body had concluded: "There is no requirement in the DSU or in GATT practice for arguments on all claims relating to the matter referred to the DSB to be set out in a complaining party's first written submission to the panel. It is the panel's terms of reference, governed by Article 7 of the DSU, which set out the claims of the complaining parties relating to the matter referred to the DSB." 43 The question of whether Canada had made "new claims" had therefore to be assessed in the light of Canada's Request for the Establishment of a Panel44, which established the Panel's terms of reference. In respect of Australia's alleged "new claims" cited above, Canada claimed that these pertained to claims that were set out in Canada's Request for the Establishment of a Panel, namely, that the Australian measure was inconsistent with Articles 2, 3 and 5 of the SPS Agreement. 4.20 Canada argued that Australia's claims of a violation of due process were groundless because (i) Canada had made no new claims, and (ii) the arguments that Australia characterized as "new claims" could be found in the various submissions that Canada had made throughout the proceedings and for which Australia had the opportunity to respond. Canada's arguments had been refined in the light of the Appellate Body's Report on EC - Hormones. This had been precisely what had been contemplated when the Panel had agreed to the Parties' request to delay the second substantive meeting until after the release of the Appellate Body's Report. 2. Relationship between GATT 1994 and the SPS Agreement 4.21 Canada argued, in the first instance, that Australia's measure was an illegal import prohibition under Article XI:1 of GATT 1994. Although Australia's measure was a sanitary measure which affected international trade within the meaning of Article 1.1 of the SPS Agreement, it was not "developed and applied according to the provisions of the Agreement" (Article 1.1) and was thus inconsistent with the SPS Agreement. Since there was no presumption that the measure was consistent with the SPS Agreement, Article 2.4 of the SPS Agreement could not be used to justify Australia's violation of Article XI of GATT 1994. 4.22 Australia agreed that the measure was a sanitary measure which affected international trade within the meaning of Article 1.1 of the SPS Agreement. Thus, Australia observed, the Panel would first have to examine claims in respect of the SPS Agreement in order to avoid a situation where the Panel first found inconsistencies with regard to a Party's obligations under GATT 1994 and subsequently found that party to be in full conformity with its obligations under the SPS Agreement and therefore, within the meaning of Article 2.4 of the SPS Agreement, in conformity with the relevant provisions of GATT 1994. Australia indicated that whereas the parties were in agreement that the measure came within the scope of the SPS Agreement, they did not agree on the identification of the measure at issue. 3. The SPS Agreement (a) Burden of proof 4.23 Canada argued that Australia's measure was inconsistent with Articles 2, 3 and 5 of the SPS Agreement. Canada accepted that it was required to present evidence sufficient to establish a presumption of a prima facie case that Australia's measure was inconsistent with its obligations under the SPS Agreement. In this regard, Canada maintained that it had put forward evidence that provided legal arguments showing that Australia's measure was inconsistent with the above cited provisions. 45 It was Australia's obligation, in turn, to put forward any alternative scientific evidence to demonstrate the scientific basis for its measure. This Australia had failed to do. 4.24 Australia agreed that it was up to the complaining party to, in the first instance, provide prima facie evidence to raise a presumption of inconsistency with regard to Australia's measure. However, Australia argued that Canada had not met the evidentiary and legal burden of proof in regard to all provisions cited by Canada. Australia noted that in regard to a prima facie case, the Appellate Body in United States - Measure Affecting Imports of Woven Wool Shirts and Blouses from India, had stated: "In addressing this issue, we find it difficult, indeed, to see how any system of judicial settlement could work if it incorporated the proposition that the mere assertion of a claim might amount to proof. It is, thus, hardly surprising that various international tribunals, including the International Court of Justice, have generally and consistently accepted and applied the rule that the party who asserts a fact, whether the claimant or the respondent, is responsible for providing proof thereof. Also, it is a generally-accepted canon of evidence in civil law, common law and, in fact, most jurisdictions, that the burden of proof rests upon the party, whether complaining or defending, who asserts the affirmative of a particular claim or defence. If that party adduces evidence sufficient to raise a presumption that what is claimed is true, the burden then shifts to the other party, who will fail unless it adduces sufficient evidence to rebut the presumption." 46 (footnotes omitted) Hence, Australia argued, the mere assertion of a claim did not amount to proof. In the above cited case, Australia recalled that the Appellate Body had ruled that: "Since India is the party that initiated the dispute settlement proceedings, we consider that it is for India to put forward factual and legal arguments in order to establish that the US restriction was inconsistent with Article 2 of the ATC and that the US determination for a safeguard action was inconsistent with the provisions of Article 6 of the ATC".47 4.25 In EC - Hormones, the Appellate Body had confirmed that the complainant had the burden of establishing a prima facie case in respect of all provisions of the SPS Agreement. In its findings and conclusions, the Appellate Body had reversed the panel's general interpretative ruling that the SPS Agreement allocated the evidentiary burden to the Member imposing an SPS measure. The Appellate Body had also reversed the panel's conclusion that when a measure was not based on an international standard in accordance with Article 3.1, the burden was on the Member to show that its SPS measure was consistent with Article 3.3 of the SPS Agreement. 48 It was clear from the Appellate Body's report that the complainant's burden of establishing a prima facie case applied across all provision of the SPS Agreement. 49 (b) The measure at issue
4.26 Canada stated that the measure at issue was Quarantine Proclamation 86A (hereafter "QP86A") introduced in February 1975, and published requirements pursuant to QP86A, that together required salmonid product to be heat treated for certain prescribed durations and temperatures prior to importation into Australia. Canada listed the 1983 Guidelines, the 1988 Conditions and the 1996 Requirements as published requirements pursuant to QP86A. 50 The result of Australia's measure, according to Canada, was to prohibit the importation of salmonid products destined for human consumption that had not been subject to such heat treatment. Canada's claim was that the prohibition on the importation of all fresh, chilled or frozen Canadian salmon, as a result of the Australian measure that included QP86A and any amendments or modifications to it, violated Australia's obligations under the SPS Agreement and GATT 1994. The products that were the subject of Canada's complaint before the DSU included Tariff Items:
Note: The products marked "*" fall outside the HS tariff classifications of fresh, chilled and frozen salmon for human consumption. 4.27 Canada argued that Australia's measure (QP86A of 1975 and subsequent published requirements pursuant to QP86A 51 fell within the definition of a sanitary measure in Annex A:1, paragraph (a), as well as within the second part of Annex A.1 ("Sanitary or phytosanitary measures include all relevant laws, decrees, regulations, requirements and procedures including, inter alia, end product criteria; processes and production methods; .... "). 4.28 Australia argued that QP86A and any amendments or modifications thereto did not represent a prohibition on imports of uncooked salmon. QP86A provided a legal basis for conditions of entry for salmon but did not constitute a prohibition per se. It established a system of permit or consent. There had not been any amendments or modifications to QP86A and substantial imports of product coming within the scope of QP86A had in fact entered Australia. QP86A did not operate as an import prohibition, but as a system of permit and consent. The Director of Quarantine had discretion whether to allow importation or not; the condition to be met was that "[t]he Director of Quarantine must be satisfied that prior to importation into Australia the product has been subject to such treatment as in the opinion of the Director of Quarantine is likely to prevent the introduction of any infectious or contagious disease, or disease or pest affecting persons, animals or plants." 52 The conditions to be attached for treatment did not proscribe the entry of fresh, chilled or frozen salmon. It was noted that experts advising the Panel did not consider heat-treated salmon to be the same product as fresh, chilled and frozen salmon and that heat- treated salmon was normally traded in eviscerated form, hence different considerations would apply. In this regard Australia noted that heat-treated salmon had been allowed into Australia since the issuance of QP86A in accordance with the exercise of the delegated authority conferred on the Director of Quarantine by QP86A; for example, substantial quantities of heat-treated salmon, including imports from Canada valued at some $A 10 million in 1996. Fresh, chilled and frozen salmon had been addressed separately, following which a decision had been taken that a permit for this product would not be issued at the present time. Only minuscule, non commercial quantities of frozen uncooked salmon tissue had been imported for scientific purposes and for taxidermy. At the current time, Australia did not permit the commercial importation of fresh, chilled or frozen salmon from any country. 4.29 In common with most other countries, Australia had historically not generally restricted imports of aquatic animal products for reasons of disease risks. Reasons include that by long established practice, aquatic products were primarily sourced from the sea, fishing vessels were free to catch product not subject to private ownership and the significance of aquatic animal disease was not fully appreciated - no ready distinctions could be made between the relevant disease status of fish caught in littoral waters or from other, more remote stocks. The growth of aquaculture and other developments changed this situation, including in relation to the rapid accumulation of evidence on incidents of disease caused damage in aquaculture and wild stocks, in part reflecting the commercial asset value of privately owned stocks. 4.30 Australia stated that the measure at issue was the 13 December 1996 Decision of the Director of Quarantine, which was that quarantine restrictions on imports into Australia of uncooked salmon product from Canada and the United States should not be permitted entry at the present time, following an import risk analysis. This decision derived from the exercise of authority by the Director of Quarantine in accordance with QP86A. In essence, the December 1996 decision meant that a permit would not be issued for importation of uncooked salmon for the purposes of free circulation within Australia for commercial consumption. This measure was applied within the meaning of paragraphs 1(a) and (b) of Annex A of the SPS Agreement as a measure applied for the purposes of protection of animal life and health which affected international trade within the meaning of Article 1.1 of the SPS Agreement. The protection of human life or health was not an issue in this dispute. 4.31 Canada noted that Australia's claim that the "measure" was the December 1996 decision by the Director of Quarantine limited the scope of the measure to wild, ocean-caught Pacific salmonids from Canada and the United States. However, the Terms of Reference for the current Panel extended to all fresh, chilled and frozen salmon from Canada. 53 The Request for the Establishment of a Panel had made it clear that Canada's claim was not limited to wild, ocean-caught Pacific salmon. The matter set out in the Request was "measures prohibiting the importation of fresh, chilled or frozen salmon" through the application of QP86A and any amendments or modifications made thereto. Thus, although the December 1996 decision fell within the Terms of Reference, it did not exhaust them. In other words, while the 1996 Decision dealt only with wild, ocean-caught Pacific salmonids, the Terms of Reference covered all fresh, chilled or frozen salmon. 54 The scope of Canada's complaint covered the following species:
In Canada, only adult salmon is harvested for export. The importation of live salmon was not an issue in this case. Live salmonids and their genetic material had not been approved for importation into Australia since the promulgation of QP86A in 1975. 56 4.32 However, if the Panel were to find that the measure at issue was the 1996 Decision, Canada argued, in the alternative, that Australia had violated Article XI of GATT for the reasons outlined in paragraph 4.228. 4.33 Furthermore, Canada maintained that paragraph 1(b) of Annex A was not relevant to the measure in question. Canada noted that in the Final Report there had been no mention of assessing risks to salmon from disease-causing organisms in food, nor could it be expected that such an assessment be made when the product in question was intended for human consumption. The first introductory paragraph of the Final Report stated that the main issues discussed were, inter alia, "the likelihood of disease entry and establishment" and "the consequences that may arise from that disease entry and establishment".57 (c) The disease agents at issue 4.34 Australia stated that the number of disease agents at issue depended on the scope of the dispute and the specific products being addressed. The initial scope of the risk assessment was uncooked salmon from both Canada and the United States. The Final Report identified 24 disease agents at issue, of which at least 20 disease agents exotic to Australia were identified as present or potentially present in adult, wild, ocean-caught Pacific salmon of Canadian and US origin. It was important to put any discussion on the number of disease agents at issue into the context of the specific product, for example whether reference was being made to Pacific, Atlantic or all products. 4.35 The risk at issue was to the health of fish, particularly salmonids and salmoniforms58, as a potential consequence of the entry or spread of one or more of at least 20 disease agents likely to be present in uncooked wild, ocean-caught Pacific salmon of Canadian (and US) origin. The risk was identified as the potential consequences of entry, establishment or spread of exotic diseases, including biological and economic consequences, for the life and health of live fish in Australia's Territory. This included the economic consequences of the impact of disease entry, establishment or spread in regard to the economic asset value of salmonid aquaculture and recreational fisheries, the biological value in regard to native salmoniforms in the built environment and extended to the quality premiums that were commanded for Australian uncooked salmon in export markets. Australian environmental conditions and the geographical concentration of commercial salmonid aquaculture left Australia significantly exposed to the impact of exotic disease establishment. Salmon had been identified in Australian scientific studies as coming within the "high risk" category in respect of exotic diseases. Salmonid recreational fisheries added significant economic benefit to regions in southern Australia, in addition to the social asset value to the population. Australia confirmed that the diseases were not of concern from a human health perspective, but that they related to the potential consequences associated with the importation of salmon for human consumption, including the pathways by which events might occur. As noted in the Final Report (pages 29 and 30) the product proposed for importation was intended for human consumption. Although most was likely to be consumed by humans the product might be used for purposes other than human consumption. The form of the product could have an impact on its final use; other possible end uses included pet feed, bait and fish feed and disposal as scrap. In this context, Australia noted that Dr. Rodgers had confirmed that salmon were scavengers. 4.36 Australia observed that, as a general rule, salmonids (salmon and trout) would be more likely to carry salmonid diseases than non-salmonids. Due to the commercial importance of salmon, the amount of science documented on salmonid disease was quite extensive when compared to other fish species, but when compared to the knowledge built up over centuries of terrestrial animal production and medicine, this total amount was small and patchy. The gaps in data were compounded by the amount of interaction between disease agents, their hosts and the environment. Australia noted that there was a difference between "known to occur" and "may occur". For many diseases there was scientific data to support the likely presence of the pathogen in salmon, though for a number of reasons the pathogen might not yet have been isolated from adult ocean-caught salmon. There were difficulties associated with growing and identifying pathogens from fish in the carrier state and the presence or absence of monitoring and surveillance programs for the disease agents. The identification of an agent in a particular host would also reflect the intensity of the testing and the sensitivity of the methodology used. When an outbreak of disease occurred, scientific resources tended to give priority to control and eradication rather than identifying the source of the disease or transmission possibilities. 4.37 Australia noted that, in addition to the identification of disease agents, disease transmission would depend on many factors, including scientific evaluation of the following:
4.38 Canada argued that Australia had not indicated what disease agents/diseases identified in the Final Report were "addressed by" Australia's measure. Canada supported the comment of the United States in its "Third Party Oral Statement" that Australia seemed unable even to make up its mind as to how many disease agents were of concern. Australia first referred to "20 or more diseases under consideration," (paragraph 47 of Australia's first submission), but then in the next sentence referred to "a possibility that up to 20 disease agents exotic to Australia may be present in Pacific salmon products". This would apparently limit the number of disease agents of concern to no more than 20. In the next paragraph, however, Australia listed 21 disease agents without identifying which 20 of these were of concern (paragraph 48 of Australia's First Submission). Australia next referred to "the 23 identified disease agents" that were"‘at issue" (paragraph 110 of Australia's First Submission). Australia never identified which 23 agents these were. Thus, even after Australia had done what it purported to be a risk assessment, it could not or would not state which disease agents were the basis of its measure. 4.39 Canada argued that when the Panel asked Australia how many and which diseases were addressed by its measure, Australia presented a list of 24 disease agents "of concern". This list included infectious salmon anaemia virus (ISA), which was never mentioned before, but no longer included Kudoa thyrsites, which was included in the list of diseases set out in the Final Report. Moreover, the list of disease agents of concern did not specify which disease agents were actually addressed by Australia's measure. This was due to the failing of the Final Report to assess the likelihood that each of the diseases Australia had identified as being "of concern" would actually establish in Australia as a result of the importation of uncooked Canadian salmon. Thus, Australia had begun its Final Report with the premise that 24 diseases or disease agents might pose a risk and concluded exactly the same way. In Canada's view, this was one of the reasons why the experts advising the Panel considered the Final Report to be nothing more than a "hazard identification". 4.40 Canada maintained that not more than 19 of these disease agents of concern to Australia were known to occur in wild or farmed salmon from Canada. Furthermore, some strains of four of these disease agents were endemic to aquatic animals in Australia. 59 With respect to adult, wild ocean-caught Pacific salmon, for which Australia had performed a risk assessment, Canada argued that only four disease agents were known to occur in that category of salmon (Table 4). To continue with Australia - Measures Affecting Importation of Salmon: Section 4.41 40 Reproduced in footnote 35. 41 WT/DS27/AB/R adopted 25 September 1997, para. 141. Canada also noted that the distinction was reiterated in: WT/DS50/AB/R, para. 91 and WT/DS26/AB/R, and WT/DS48/AB/R para. 156. 42 WT/DS27/AB/R, para. 143. 43 Ibid., para. 145. 44 WT/DS18/2. 45 Canada noted that the issues had been exhaustively reviewed in the Appellate Body report in United States - Measures Affecting Imports of Woven Wool Shirts and Blouses from India (adopted on 23 May 1997, WT/DS33/AB/R). There, the Appellate Body had considered the issue of burden of proof under the Agreement on Textiles and Clothing (the "ATC") respecting the issue of a complaint by India that certain restrictions imposed by the United States did not respect the transitional safeguard provisions of Articles 2.4 and 6 of the ATC. The Appellate Body had stated that: "We agree with the Panel that it was up to India to present evidence and argument sufficient to establish a presumption that the transitional safeguard determination made by the United States was inconsistent with its obligations under Article 6 of the ATC. With this presumption thus established, it was then up to the United States to bring evidence and argument to rebut the presumption." (p.13) ... "[A] party claiming a violation of a provision of the WTO Agreement by another Member must assert and prove its claim. In this case, India claimed a violation by the United States of Article 6 of the ATC. We agree with the Panel that it, therefore, was up to India to put forward evidence and legal argument sufficient to demonstrate that the transitional safeguard action by the United States was inconsistent with the obligations assumed by the United States under Articles 2 and 6 of the ATC. India did so in this case. And, with India having done so, the onus then shifted to the United States to bring forward evidence and argument to disprove the claim. This, the United States was not able to do and, therefore, the Panel found that the transitional safeguard action by the United States "violated the provisions of Articles 2 and 6 of the ATC"." (p.16) Canada stated that the reasoning in the Appellate Body decision equally applied to the SPS Agreement. 46 Ibid., p.14. 47 Ibid., p.12 (the Appellate Body's confirmation of the Panel's findings). 48 Op. cit., para. 253. 49 Ibid., para. 108. 50 Paragraph 2.16. 51 The 1983 Guidelines, the 1988 Conditions and the 1996 Requirements, paragraph . 52 Paragraph 2.14. 53 WT/DS18/2. 54 Table 1. 55 The first five species are known collectively as "Pacific salmon". Most harvested Pacific salmon is wild, ocean-caught. Almost all Atlantic salmon is farmed, including on the Pacific coast. 56 Final Report, p.5. 57 Ibid., "Purpose of Paper", p.3. 58 Salmoniforms is the common name for the Order Salmoniformes. Salmonids is the common name for the Family Salmonidae within the Order Salmoniformes. 59 Aeromonas salmonicida (some atypical strains), Edwardisiella tarda, Yersinia ruckeri (some strains) and Vibrio anguillarum (some strains). |
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