   
  
WT/GC/W/768  
 
18 April 2019  
(19-2581) Page: 1/3 
General Council  Original: English  
 
INFORMAL PROCESS ON MATTERS RELATED TO T HE FUNCTIONING  
OF THE APPELLATE BOD Y 
COMMUNICATION FROM J APAN AND AUSTRALIA  
The following communication, dated 17 April 2019, is being circulated at the request of the 
delegations of Japan and Australia.  
 
 
 
 
1  INTRODUCTION  
1.1.  We share the concerns of many WTO Members concerning the importance of an effectively 
functioning WTO dispute settlement system. We welcomed the initiative to entrust a facilitator to 
consult informally on matters related to the functioning of  the Appellate Body.  Like other delegations, 
we participated in the open -ended meetings and other sessions convened by the facilitator.  
1.2.  Building on Ambassador Walker 's report of 28 February, we wish to present the following ideas 
as an option to be conside red in further work on this subject.  
1.3.  We propose that Members focus their work toward adopting a decision, or decisions, of the 
Dispute Settlement Body (DSB), affirming and clarifying the existing provisions of the Dispute 
Settlement Understanding (DSU). A  decision of this nature would be the most practical, feasible and 
expeditious solution to the key issues confronting all Members in respect of the WTO dispute 
settlement system.  
1.4.  A proposed draft of such a decision is laid out below, although other vehicl es could be 
considered if they are effective and realizable.  
1.5.  Nothing in the decision shall be construed as adding to or diminishing the rights and obligations 
of Members under the Marrakesh Agreement Establishing the World Trade Organization.  
1.6.  The draft dec ision addresses some of the concerns that have been raised in our discussions. 
Maintaining a focus on the DSB 's role to achieve a satisfactory settlement of matters before it, we 
would also like to address issues like advisory opinions, procedures to select persons to fill Appellate 
Body vacancies ，and managing the implications when an Appellate Body member 's term expires 
(Rule 15 issue) on other occasions.  We welcome contribution on these issues as well as on additional 
contributions on any other issue s as part of this process.  
2  DRAFT DECISION  
The Dispute Settlement Body,  
 
Having regard to paragraph 1 of Article 2 and Article 17 of the Understanding on Rules and 
Procedures Governing the Settlement of Disputes (DSU),  
 
Affirming  that recommendations and ru lings made by the DSB are aimed at achieving a 
satisfactory settlement of the matter in accordance with the rights and obligations under the DSU WT/GC/W/768  
 
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  and the covered agreements, and cannot add to or diminish the rights and obligations provided in 
the covered ag reements,  
 
Mindful that the dispute settlement system of the WTO is a central element in providing 
security and predictability to the multilateral trading system,  
 
Decides  as follows:  
 
Scope of issues to be considered by the Appellate Body  
 
1. Members confirm that when the Appellate Body addresses the issues raised by the parties to the 
dispute per paragraph 12 of Article 17 of the DSU, the scope of the Appellate Review shall be 
limited to issues of law covered in a panel report and legal interp retations developed by the 
panel in strict compliance with paragraph 6 of Article 17 of the DSU.  
2. Members confirm that the Appellate Body shall not review panel 's fact -finding, such as meaning 
of municipal law, as an issue of law.  
3. Members affirm that they should refrain from filing appeals to the Appellate Body beyond the 
remit of Appellate Body.  
Strict observance of the 90 -day deadline for Appellate Review  
 
4. Members confirm that the prompt settlement of disputes is essential to the effective functioning 
of the WTO and the maintenance of the proper balance between the rights and obligations of 
Members, as stated in Article 3.3 of the DSU.  
5. Members confirm that the Appellate Body shall strictly observe the 90 day deadlines for Appellate 
Review.  
6. Members also rec ognize the difficulty in some cases, in particular, those involving complicated 
measures and/or legal claims, and confirm that the Members involved would need to resolve the 
resulting procedural consequences in such cases.  
[Note:  This issue in the paragrap h above needs to be discussed further in the ongoing process]  
 
Issue of precedential value of interpretation by the Appellate Body  
 
7. Members confirm that an interpretation by the Appellate Body of any WTO provision does not 
constitute a precedent for poster ior interpretations.  
8. Members confirm that panels may adopt an interpretation of a WTO provision that is different 
from the one developed by the Appellate Body.  
9. Members reaffirm the important role of the dispute settlement system in providing security and 
predictability, as stated in paragraph 2 of Article 3 of the DSU.  
Requirements that the panel and Appellate Body cannot add to or diminish the rights and obligations 
of Members  
 
10. Members confirm that recommendations and rulings of the DSB cannot add to or di minish the 
rights and obligations provided in the covered agreements, in accordance with paragraph 2 of 
Article 3 and paragraph 2 of Article 19 of the DSU.  
11. Members also confirm that panels and the Appellate Body should refrain from making a finding 
or reco mmendation on any of the issues of law and legal interpretation of relevant provisions of 
the WTO Agreement to the extent that the finding or recommendation adds to or diminishes the 
rights and obligations provided in the covered agreements.  
12. Members confir m that panels and the Appellate Body shall interpret, in accordance with 
paragraph 6(ii) of Article 17 of the Anti -dumping Agreement, any provision of that Agreement WT/GC/W/768  
 
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  that admits of more than one permissible interpretation, so as not to add to or diminish t he 
rights and obligations provided in the covered agreements.  
Regular dialogue between the DSB and the Appellate Body  
 
13. In order to ensure the implementation of the decision afterwards, the DSB, in consultation with 
the Appellate Body, will establish a regu lar dialogue channel between the DSB and the Appellate 
Body.  
14. Members affirm that they will also consider how to ensure the implementation of the outcomes 
of the regular dialogue between the DSB and the Appellate Body.  
 
__________  