V. The Characterization of the EC Regulation as a "Technical Regulation"

171. We now turn to whether the Panel erred by finding that the EC Regulation is a "technical regulation" for purposes of Article 2.4 of the TBT Agreement . We recall that we have described the measure at issue-the EC Regulation-earlier in this Report.⁷²

172. The Panel found that:

� the EC Regulation is a technical regulation as it lays down product characteristics for preserved sardines and makes compliance with the provisions contained therein mandatory.⁷³

173. The European Communities does not contest that the EC Regulation is a "technical regulation" per se .⁷⁴ Instead, on appeal, the European Communities reiterates two arguments that the Panel rejected. First, the European Communities argues that the product coverage of the EC Regulation is limited to preserved Sardina pilchardus . The European Communities contends that the EC Regulation does not regulate preserved fish made from Sardinops sagax or from any other species, and that, accordingly, Sardinops sagax is not an identifiable product under the EC Regulation.⁷⁵ The European Communities concludes that, in the light of our ruling in European Communities - Measures Affecting Asbestos and Asbestos-Containing Products ("EC - Asbestos ")⁷⁶ that a "technical regulation" must apply to identifiable products, the EC Regulation is not a "technical regulation" for Sardinops sagax .⁷⁷

174. Second, the European Communities contends that a "naming" rule is distinct from a labelling requirement. The European Communities argues that, "[t]he requirement to state a certain name on the label � involves not only a labelling requirement but also a substantive naming rule, which is not subject to the TBT Agreement."⁷⁸ Thus, according to the European Communities, even if it were determined that the EC Regulation relates to Sardinops sagax , the "naming" rule set out in Article 2 of the EC Regulation-the provision challenged by Peru-is not a product characteristic.⁷⁹ On this basis, the European Communities argues that Article 2 of the EC Regulation-which the European Communities contends sets out a "naming" rule and not a labelling requirement-does not meet the definition of the term "technical regulation" provided in the TBT Agreement.⁸⁰

175. As we explained in EC - Asbestos, whether a measure is a "technical regulation" is a threshold issue because the outcome of this issue determines whether the TBT Agreement is applicable.⁸¹ If the measure before us is not a "technical regulation", then it does not fall within the scope of the TBT Agreement.⁸² The term "technical regulation" is defined in Annex 1.1 to the TBT Agreement as follows:

1. Technical Regulation

Document which lays down product characteristics or their related processes and production methods, including the applicable administrative provisions, with which compliance is mandatory. It may also include or deal exclusively with terminology, symbols, packaging, marking or labelling requirements as they apply to a product, process or production method.

176. We interpreted this definition in EC - Asbestos.⁸³ In doing so, we set out three criteria that a document must meet to fall within the definition of "technical regulation" in the TBT Agreement . First, the document must apply to an identifiable product or group of products. The identifiable product or group of products need not, however, be expressly identified in the document. Second, the document must lay down one or more characteristics of the product. These product characteristics may be intrinsic, or they may be related to the product. They may be prescribed or imposed in either a positive or a negative form. Third, compliance with the product characteristics must be mandatory. As we stressed in EC - Asbestos, these three criteria are derived from the wording of the definition in Annex 1.1. At the oral hearing, both participants confirmed that they agree with these criteria for determining whether a document is a "technical regulation" under the TBT Agreement.⁸⁴

177. The European Communities concedes that the EC Regulation is a "technical regulation" per se.⁸⁵  All the same, the European Communities argues that the EC Regulation is not a "technical regulation" for the purposes of this dispute because-in relation to Sardinops sagax -it does not fulfil two of the criteria that a document must meet to be considered a "technical regulation" under the TBT Agreement.⁸⁶ The European Communities' assertion that the EC Regulation does not regulate preserved Sardinops sagax relates to the first criterion, which requires that a document apply to identifiable products. The European Communities' argument distinguishing "naming" from labelling requirements relates to the second criterion, which requires that a document lay down product characteristics. We will consider each of these arguments in turn.

178. We begin with the European Communities' contention that the EC Regulation is a "technical regulation" only for preserved Sardina pilchardus , and that preserved Sardinops sagax is not an identifiable product under the EC Regulation.

179. The Panel rejected this argument because, in the Panel's view, it:

� disregards the notion that a document may prescribe or impose product characteristics in either a positive or negative form - that is, by inclusion or by exclusion.⁸⁷ (footnote omitted)

The Panel then concluded that:

� by requiring the use of only the species Sardina pilchardus as preserved sardines, the EC Regulation in effect lays down product characteristics in a negative form, that is, by excluding other species, such as Sardinops sagax , from being "marketed as preserved sardines and under the trade description referred to in Article 7" of the EC Regulation. It is for this reason that we do not accept the European Communities' argument that the EC Regulation is not a technical regulation for preserved Sardinops sagax . This argument would be persuasive only if technical regulations were to lay down product characteristics in a positive form.⁸⁸ (emphasis added)

This excerpt from the Panel Report suggests that the Panel examined the European Communities' argument on this issue in the light of the second criterion, which requires that a document lay down product characteristics.⁸⁹ In our view, the European Communities' argument, as presented on appeal, relates rather to the first criterion: the European Communities is claiming that preserved Sardinops sagax is not an identifiable product under the EC Regulation.⁹⁰

180. In EC - Asbestos, we made the following observations about the requirement that a document apply to identifiable products:

A "technical regulation" must, of course, be applicable to an identifiable product, or group of products. Otherwise, enforcement of the regulation will, in practical terms, be impossible. This consideration also underlies the formal obligation, in Article 2.9.2 of the TBT Agreement, for Members to notify other Members, through the WTO Secretariat, "of the products to be covered " by a proposed "technical regulation". (emphasis added) Clearly, compliance with this obligation requires identification of the product coverage of a technical regulation. However, in contrast to what the Panel suggested, this does not mean that a "technical regulation" must apply to "given" products which are actually named, identified or specified in the regulation. (emphasis added) Although the TBT Agreement clearly applies to "products" generally, nothing in the text of that Agreement suggests that those products need be named or otherwise expressly identified in a "technical regulation". Moreover, there may be perfectly sound administrative reasons for formulating a "technical regulation" in a way that does not expressly identify products by name, but simply makes them identifiable - for instance, through the "characteristic" that is the subject of regulation.⁹¹ (original emphasis; footnote omitted)

Thus, a product does not necessarily have to be mentioned explicitly in a document for that product to be an identifiable product. Identifiable does not mean expressly identified.

181. The European Communities argues that the Panel erred in failing to acknowledge that the EC Regulation uses the term "preserved sardines" to mean-exclusively-preserved Sardina pilchardus.⁹² The European Communities is of the view that preserved Sardina pilchardus and preserved Sardinops sagax are not like products. The European Communities reasons that preserved Sardinops sagax can neither be an identified nor an identifiable product under the EC Regulation.⁹³

182. In our view, the Panel correctly found that the EC Regulation is applicable to an identified product, and that the identified product is "preserved sardines". This is abundantly clear from a plain reading of the EC Regulation itself. The EC Regulation is entitled "Council Regulation (EEC) 2136/89 of 21 June 1989 Laying Down Common Marketing Standards for Preserved Sardines". (emphasis added) Article 1, which sets forth the scope of the EC Regulation, states that "[t]his Regulation defines the standards governing the marketing of preserved sardines in the Community." (emphasis added) Article 2 states that "[o]nly products meeting the following requirements may be marketed as preserved sardines". (emphasis added)

183. This alone, however, does not dispose of the European Communities' argument, as the European Communities reproaches the Panel for failing to acknowledge that the EC Regulation uses the term "preserved sardines" to mean-exclusively-preserved Sardina pilchardus. We observe that the EC Regulation does not expressly identify Sardinops sagax . However, this does not necessarily mean that Sardinops sagax is not an identifiable product. As we stated in EC - Asbestos, a product need not be expressly identified in the document for it to be identifiable.⁹⁴

184. Even if we were to accept, for the sake of argument, the European Communities' contention that the term "preserved sardines" in the EC Regulation refers exclusively to preserved Sardina pilchardus , the EC Regulation would still be applicable to a range of identifiable products beyond Sardina pilchardus. This is because preserved products made, for example, of Sardinops sagax are, by virtue of the EC Regulation, prohibited from being identified and marketed under an appellation including the term "sardines".

185. As we explained in EC - Asbestos, the requirement that a "technical regulation" be applicable to identifiable products relates to aspects of compliance and enforcement, because it would be impossible to comply with or enforce a "technical regulation" without knowing to what the regulation applied.⁹⁵ As the Panel record shows, the EC Regulation has been enforced against preserved fish products imported into Germany containing Sardinops sagax .⁹⁶ This confirms that the EC Regulation is applicable to preserved Sardinops sagax , and demonstrates that preserved Sardinops sagax is an identifiable product for purposes of the EC Regulation. Indeed, the European Communities admits that the EC Regulation is applicable to Sardinops sagax , when it states in its appellant's submission that "[t]he only legal consequence of the [EC] Regulation for preserved Sardinops sagax is that they may not be called 'preserved sardines'."⁹⁷

186. Therefore, we reject the contention of the European Communities that preserved Sardinops sagax is not an identifiable product under the EC Regulation.

187. Next, we examine whether the EC Regulation meets the second criterion of a "technical regulation", which is that it must be a document that lays down product characteristics. According to the European Communities, Article 2 of the EC Regulation does not lay down product characteristics; rather, it sets out a "naming" rule. The European Communities argues that, although the definition of "technical regulation" in the TBT Agreement covers labelling requirements, it does not extend to "naming" rules. Therefore, the European Communities asserts that Article 2 of the EC Regulation is not a "technical regulation".⁹⁸

188. The Panel rejected this assertion for two reasons. First, the Panel stated:

� even if it were determined that the EC Regulation does not contain a labelling requirement, it cannot detract from our conclusion that the EC Regulation constitutes a technical regulation because that conclusion is based on our finding that it lays down certain product characteristics we have already identified. A finding to the effect that the EC Regulation does not contain a related product characteristic in the form of a labelling requirement does not negate the existence of other product characteristics set out in the EC Regulation.⁹⁹

The Panel continued:

Second, we fail to see the basis on which a distinction can be drawn between a requirement to "name" and a requirement to "label" a product for the purposes of the TBT Agreement . � Based on the ordinary meaning, we consider that labelling and naming requirements are essentially "means of identification" of a product and as such, they come within the scope of the definition of "technical regulation".

In any event, the distinction which we have been asked to draw between "naming" and "labelling" requirements is not supported by the text and structure of the EC Regulation.¹⁰⁰ (footnotes omitted)

189. In EC - Asbestos, we examined what it means to lay down product characteristics, and concluded that:

The heart of the definition of a "technical regulation" is that a "document" must "lay down" - that is, set forth, stipulate or provide - "product characteristics". The word "characteristic" has a number of synonyms that are helpful in understanding the ordinary meaning of that word, in this context. Thus, the "characteristics" of a product include, in our view, any objectively definable "features", "qualities", "attributes", or other "distinguishing mark" of a product. Such "characteristics" might relate, inter alia, to a product's composition, size, shape, colour, texture, hardness, tensile strength, flammability, conductivity, density, or viscosity. In the definition of a "technical regulation" in Annex 1.1, the TBT Agreement itself gives certain examples of "product characteristics" - "terminology, symbols, packaging, marking or labelling requirements". These examples indicate that "product characteristics" include, not only features and qualities intrinsic to the product itself, but also related "characteristics", such as the means of identification, the presentation and the appearance of a product. In addition, according to the definition in Annex 1.1 of the TBT Agreement , a "technical regulation" may set forth the "applicable administrative provisions" for products which have certain "characteristics". Further, we note that the definition of a "technical regulation" provides that such a regulation "may also include or deal exclusively with terminology, symbols, packaging, marking or labelling requirements". (emphasis added) The use here of the word "exclusively" and the disjunctive word "or" indicates that a "technical regulation" may be confined to laying down only one or a few "product characteristics".¹⁰¹ (original emphasis; underlining added)

Accordingly, product characteristics include not only "features and qualities intrinsic to the product", but also those that are related to it, such as "means of identification".

190. We do not find it necessary, in this case, to decide whether the definition of "technical regulation" in the TBT Agreement makes a distinction between "naming" and labelling. This question is irrelevant to the issue before us. As we stated earlier, the EC Regulation expressly identifies a product, namely "preserved sardines". Further, Article 2 of the EC Regulation provides that, to be marketed as "preserved sardines", products must be prepared exclusively from fish of the species Sardina pilchardus . We are of the view that this requirement-to be prepared exclusively from fish of the species Sardina pilchardus�is a product characteristic "intrinsic to" preserved sardines that is laid down by the EC Regulation.¹⁰² Thus, we agree with the Panel's finding in this regard that:

� one product characteristic required by Article 2 of the EC Regulation is that preserved sardines must be prepared exclusively from fish of the species Sardina pilchardus. This product characteristic must be met for the product to be "marketed as preserved sardines and under the trade description referred to in Article 7" of the EC Regulation. We consider that the requirement to use exclusively Sardina pilchardus is a product characteristic as it objectively defines features and qualities of preserved sardines for the purposes of their "market[ing] as preserved sardines and under the trade description referred to in Article 7" of the EC Regulation.¹⁰³

191. In any event, as we said in EC - Asbestos, a "means of identification" is a product characteristic.¹⁰⁴ A name clearly identifies a product; indeed, the European Communities concedes that a name is a "means of identification".¹⁰⁵ As the following excerpt from the Panel Report illustrates, the European Communities itself underscored the important role that a "name" plays as a "means of identification" when it argued before the Panel that one of the objectives pursued by the European Communities through the EC Regulation is to provide precise information to avoid misleading the consumer:

The European Communities argues that the provisions of its Regulation laying down minimum quality standards, harmonizing the ways in which the product may be presented and regulating the indications to be contained on the label, all serve to facilitate comparisons between competing products. It further submits that some of these objectives are pursued by the Regulation at issue in conjunction with EC Directive 2000/13. The European Communities argues that this is particularly true of the name; accurate and precise names allow products to be compared with their true equivalents rather than with substitutes and imitations whereas inaccurate and imprecise names reduce transparency, cause confusion, mislead the consumer, allow products to benefit from the reputation of other different products, give rise to unfair competition and reduce the quality and variety of products available in trade and ultimately for the consumer.¹⁰⁶ (emphasis added)

192. Before concluding on this second criterion and proceeding to the third criterion in the definition of "technical regulation", we observe that, although the European Communities argued before the Panel that Article 2 of the EC Regulation could not be analyzed in isolation, on appeal, the European Communities asks us to focus our attention exclusively on whether Article 2, taken by itself, lays down product characteristics.¹⁰⁷ As the Panel correctly points out, in EC - Asbestos, we stated that "the proper legal character of the measure at issue cannot be determined unless the measure is examined as a whole".¹⁰⁸ With this in mind, we observe that the Panel analyzed other articles of the EC Regulation and found that that those, too, lay down product characteristics.¹⁰⁹

193. For all these reasons, we agree with the Panel's conclusion that the EC Regulation lays down product characteristics.

194. The third and final criterion that a document must fulfil to meet the definition of "technical regulation" in the TBT Agreement is that compliance must be mandatory. The European Communities does not contest that compliance with the EC Regulation is mandatory.¹¹⁰ We also find that it is mandatory.¹¹¹

195. We, therefore, uphold the Panel's finding, in paragraph 7.35 of the Panel Report, that the EC Regulation is a "technical regulation" for purposes of the TBT Agreement , because it meets the three criteria we set out in EC - Asbestos as necessary to satisfy the definition of a "technical regulation" under the TBT Agreement.

VI. The Temporal Scope of Application of Article 2.4 of the TBT Agreement

196. We turn now to the European Communities' claim that Article 2.4 of the TBT Agreement does not apply to pre-existing technical regulations because it deals only with the preparation and adoption of technical regulations and not with their continued application. On this issue, we begin by recalling that the EC Regulation and Codex Stan 94 came into effect before the entry into force of the TBT Agreement on 1 January 1995.

197. The Panel found that:

�the EC Regulation is a "situation or measure that did not cease to exist" and the TBT Agreement does not reveal a contrary intention to limit the temporal application of the TBT Agreement to measures adopted after 1 January 1995.

Therefore, Article 2.4 of the TBT Agreement applies to measures that were adopted before 1 January 1995 but which have not ceased to exist.¹¹²

198. The Panel also rejected "the European Communities' argument that Article 2.4 [of the TBT Agreement ] does not apply to existing technical regulations."¹¹³

199. The European Communities appeals this finding. The European Communities "does not argue that the TBT Agreement does not apply to technical regulations enacted before 1995".¹¹⁴ Instead, the European Communities contends that Article 2.4 of that Agreement does not impose an ongoing obligation on Members to reassess their existing technical regulations in the light of the adoption of new international standards, or the revision of existing ones.¹¹⁵

200. We recall that Article 28 of the Vienna Convention on the Law of Treaties (the "Vienna Convention")¹¹⁶ provides that treaties generally do not apply retroactively. Article 28 provides:

Non-retroactivity of treaties

Unless a different intention appears from the treaty or is otherwise established, its provisions do not bind a party in relation to any act or fact which took place or any situation which ceased to exist before the date of the entry into force of the treaty with respect to that party. (emphasis added)

As we have said in previous disputes¹¹⁷, the interpretation principle codified in Article 28 is relevant to the interpretation of the covered agreements.

201. In the European Communities' view, both the text and the context of Article 2.4 make plain that the scope of application of Article 2.4 is limited to the preparation and adoption of technical regulations, and not to their maintenance.¹¹⁸ The European Communities does not contest that the EC Regulation-which is currently in force-is an act that has not "ceased to exist". However, according to the European Communities, the preparation and adoption of the EC Regulation are both "acts that ceased to exist"-in the sense that they were completed-before the date of the entry into force of the TBT Agreement . Therefore, the European Communities contends that, consistent with Article 28 of the Vienna Convention¹¹⁹, Article 2.4 of the TBT Agreement is not applicable to the EC Regulation.¹²⁰

202. The text of Article 2.4 of the TBT Agreement provides as follows:

TECHNICAL REGULATIONS AND STANDARDS

Article 2

Preparation, Adoption and Application of Technical Regulations by
Central Government Bodies

With respect to their central government bodies:

�

2.4 Where technical regulations are required and relevant international standards exist or their completion is imminent, Members shall use them, or the relevant parts of them, as a basis for their technical regulations except when such international standards or relevant parts would be an ineffective or inappropriate means for the fulfilment of the legitimate objectives pursued, for instance because of fundamental climatic or geographical factors or fundamental technological problems.

203. According to the European Communities, it is evident from the text of Article 2.4 that the temporal scope of the provision is limited to the two stages of preparation and adoption of technical regulations, and that the continued existence thereafter of these regulations is not governed by that provision. The European Communities finds support for this contention in what the European Communities sees as the time-limited nature of the terms "where technical regulations are required", "exist", "imminent", "use", and "as a basis for" in the text of Article 2.4, and also in the absence in the text of that provision of the words "maintain" or "apply".¹²¹

204. The Panel took a contrary view, and concluded that a textual reading does not support the European Communities' assertion because:

Article 2.4 of the TBT Agreement starts with the language "where technical regulations are required". We construe this expression to cover technical regulations that are already in existence as it is entirely possible that a technical regulation that is already in existence can continue to be required. � Moreover, we note that the first part of the sentence of Article 2.4 is in the present tense ("exist") and not in the past tense - "[w]here technical regulations are required and relevant international standards exist or their completion is imminent", Members are obliged to use such international standards as a basis. This supports the view that Members have to use relevant international standards that currently exist or whose completion is imminent with respect to the technical regulations that are already in existence. We do not consider that the word "imminent", the ordinary meaning of which is "likely to happen without delay", is intended to limit the scope of the coverage of technical regulations to those that have yet to be adopted. Rather, the use of the word "imminent" means that Members cannot disregard a relevant international standard whose completion is imminent with respect to their existing technical regulations.¹²² (original emphasis; footnote omitted)

205. We concur with the Panel's view that the text of Article 2.4 of the TBT Agreement does not support the European Communities' contention. We fail to see how the terms "where technical regulations are required", "exist", "imminent", "use", and "as a basis for" give any indication that Article 2.4 applies only to the two stages of preparation and adoption of technical regulations. To the contrary, as the Panel noted, the use of the present tense suggests a continuing obligation for existing measures, and not one limited to regulations prepared and adopted after the TBT Agreement entered into force. The European Communities reads Article 2.4 as if it said "where technical regulations are in preparation or are to be adopted", which is clearly not the case. The obligation refers to technical regulations generally and without limitations.

206. The European Communities' claim is also at odds with our reasoning in EC Measures Concerning Meat and Meat Products (Hormones) ("EC - Hormones")¹²³, which, as the Panel correctly pointed out, is relevant to the issue before us. In EC - Hormones, we addressed the temporal scope of the Agreement on the Application of Sanitary and Phytosanitary Measures (the "SPS Agreement"), and stated:

We agree with the Panel that the SPS Agreement would apply to situations or measures that did not cease to exist, such as the 1981 and 1988 Directives, unless the SPS Agreement reveals a contrary intention. We also agree with the Panel that the SPS Agreement does not reveal such an intention. The SPS Agreement does not contain any provision limiting the temporal application of the SPS Agreement, or of any provision thereof, to SPS measures adopted after 1 January 1995. In the absence of such a provision, it cannot be assumed that central provisions of the SPS Agreement, such as Articles 5.1 and 5.5, do not apply to measures which were enacted before 1995 but which continue to be in force thereafter. If the negotiators had wanted to exempt the very large group of SPS measures in existence on 1 January 1995 from the disciplines of provisions as important as Articles 5.1 and 5.5, it appears reasonable to us to expect that they would have said so explicitly.¹²⁴ (emphasis added; footnote omitted)

207. Like the sanitary measure in EC - Hormones, the EC Regulation is currently in force. The European Communities has conceded that the EC Regulation is an act or fact that has not "ceased to exist".¹²⁵ Accordingly, following our reasoning in EC - Hormones, Article 2.4 of the TBT Agreement applies to existing measures unless that provision "reveals a contrary intention".¹²⁶ As we have said, we see nothing in Article 2.4 which would suggest that the provision does not apply to existing measures.

208. Furthermore, like Articles 5.1 and 5.5 of the SPS Agreement, Article 2.4 is a "central provision" of the TBT Agreement , and it cannot just be assumed that such a central provision does not apply to existing measures. Again, following our reasoning in EC - Hormones, we must conclude that, if the negotiators had wanted to exempt the very large group of existing technical regulations from the disciplines of a provision as important as Article 2.4 of the TBT Agreement , they would have said so explicitly.¹²⁷ No such explicit exemption is found in the terms "where technical regulations are required", "exist", "imminent", "use", or "as a basis for".

209. The European Communities' argument that our ruling in EC - Hormones is not relevant to Article 2.4 of the TBT Agreement is not persuasive. The European Communities contends that we based our ruling in EC - Hormones on the wording of Articles 2.2, 2.3, 3.3, and 5.6 of the SPS Agreement, and that all these provisions include the word "maintain".¹²⁸ The European Communities argues that the word "maintain" implies that a provision applies to measures already prepared and adopted. The European Communities then notes that Article 2.4 of the TBT Agreement does not include the word "maintain".¹²⁹ It is true that, in EC - Hormones, we referred to Articles 2.2, 2.3, 3.3, and 5.6 of the SPS Agreement. But we did so as relevant context.¹³⁰ Our analysis there focused on the meaning of Articles 5.1 and 5.5 of the SPS Agreement, which, like Article 2.4 of the TBT Agreement, do not include the word "maintain".¹³¹ As we have explained, we found in that appeal that Articles 5.1 and 5.5 of the SPS Agreement apply to existing measures, despite the absence of the word "maintain". Thus, this argument by the European Communities fails on its own logic.

210. Having considered the European Communities' arguments based on the text of Article 2.4, we turn to examine the arguments of the European Communities that are based on the context of that provision. The European Communities argues that Article 2.5 of the TBT Agreement demonstrates that, when a provision is intended to cover the application of technical regulations, the provision says so explicitly. The European Communities finds similar contextual support in Article 12.4 of the TBT Agreement , which uses the word "adopt", and in paragraph F of the Code of Good Practice for the Preparation, Adoption and Application of Standards, included as Annex 3 to the TBT Agreement , which uses the word "develops".¹³²

211. In discussing what it considered the relevant context of Article 2.4, the Panel looked first to Article 2.5 of the TBT Agreement :

There is contextual support for the interpretation that Article 2.4 applies to technical regulations that are already in existence. The context provided by Article 2.5, which explicitly refers to Article 2.4, speaks of "preparing, adopting or applying" a technical regulation and is not limited to, as the European Communities claims, to preparing and adopting. A technical regulation can only be applied if it is already in existence. The first sentence imposes an obligation on a Member "preparing, adopting or applying" a technical regulation that may have a significant effect on trade of other Members to provide the justification for that technical regulation. The second sentence of Article 2.5 states that whenever a technical regulation is "prepared, adopted or applied" for one of the legitimate objectives explicitly set out in Article 2.2 and is in accordance with relevant international standards, it is to be rebuttably presumed not to create an unnecessary obstacle to trade. The use of the term "apply", in our view, confirms that the requirement contained in Article 2.4 is applicable to existing technical regulations.¹³³ (original emphasis)

The Panel also looked to Article 2.6 of the TBT Agreement :

Article 2.6 provides another contextual support. It states that Members are to participate in preparing international standards by the international standardizing bodies for products which they have either "adopted, or expect to adopt technical regulations." Those Members that have in place a technical regulation for a certain product are expected to participate in the development of a relevant international standard. Article 2.6 would be redundant and it would be contrary to the principle of effectiveness, which is a corollary of the general rule of interpretation in the Vienna Convention, if a Member is to participate in the development of a relevant international standard and then claim that such standard need not be used as a basis for its technical regulation on the ground that it was already in existence before the standard was adopted. Such reasoning would allow Members to avoid using international standards as a basis for their technical regulations simply by enacting preemptive measures and thereby undermine the object and purpose of developing international standards.¹³⁴ (original emphasis)

212. We agree with the Panel's analysis. Thus, we find no support for the European Communities' claim in the context of Article 2.4 of the TBT Agreement . Rather than supporting the European Communities' argument, Articles 2.5 and 2.6 of the TBT Agreement provide support for the argument advanced by Peru that Article 2.4 of the TBT Agreement regulates measures adopted before the date of the entry into force of the TBT Agreement . We note also that there is additional contextual support in the title of Article 2, which reads "Preparation, Adoption and Application of Technical Regulations by Central Government Bodies". (emphasis added) This express reference to the application of technical regulations in the title of Article 2 runs counter to an interpretation of Article 2.4 that would limit its scope to the preparation and adoption of technical regulations.

213. Moreover, as general context for all the covered agreements, Article XVI:4 of the Marrakesh Agreement Establishing the World Trade Organization is of great significance. Article XVI:4 reads:

Each Member shall ensure the conformity of its laws, regulations and administrative procedures with its obligations as provided in the annexed Agreements.

This provision establishes a clear obligation for all WTO Members to ensure the conformity of their existing laws, regulations, and administrative procedures with the obligations in the covered agreements.

214. In our view, the European Communities' reading of Article 2.4 also flies in the face of the object and purpose of the TBT Agreement . In several of its provisions, the TBT Agreement recognizes the important role that international standards play in promoting harmonization and facilitating trade. For example, Article 2.5 of the TBT Agreement establishes a rebuttable presumption that technical regulations that are in accordance with relevant international standards do not create unnecessary obstacles to trade. Article 2.6, for its part, encourages Members to participate in international standardizing bodies with a view to harmonizing technical regulations on as wide a basis as possible.

215. The significant role of international standards is also underscored in the Preamble to the TBT Agreement . The third recital of the Preamble recognizes the important contribution that international standards can make by improving the efficiency of production and facilitating the conduct of international trade. The eighth recital recognizes the role that international standardization can have in the transfer of technology to developing countries. In our view, excluding existing technical regulations from the obligations set out in Article 2.4 would undermine the important role of international standards in furthering these objectives of the TBT Agreement . Indeed, it would go precisely in the opposite direction.

216. For all these reasons, we uphold the Panel's finding, in paragraph 7.60 of the Panel Report, that Article 2.4 of the TBT Agreement applies to measures that were adopted before 1 January 1995 but which have not ceased to exist, such as the EC Regulation. We also uphold the Panel's finding, in paragraph 7.83 of the Panel Report, that Article 2.4 of the TBT Agreement applies to existing technical regulations, including the EC Regulation.

134 Ibid., para. 7.76.

To continue with VII. The Characterization of Codex Stan 94 as a "Relevant International Standard"

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