Dispute Settlement Reports 2002 : Volume 5, Pages 1819-2070

India Measures Affecting the Automotive Sector (WT/DS146, WT/DS175) Report of the Appellate Body 1821(6) Report of the Panel 1827(5) I. INTRODUCTION 1832(2) II. FACTUAL ASPECTS 1834(2) A. The Licensing Regime 1834(1) B. Public Notice No. 60 and the MOUs 1835(1) III. PARTIES' REQUESTS FOR FINDINGS AND RECOMMENDATIONS 1836(3) A. US Claims and Requests for Findings 1836(1) B. EC Claims and Requests for Findings 1836(1) C. India's Requests for Findings 1837(2) IV. ARGUMENTS OF THE PARTIES 1839(104) A. Factual Arguments 1839(10) 1. The Licensing Regime 1839(2) 2. Public Notice No. 60 and the MOUs 1841(8) (a) The "indigenization" Requirement (paragraph 3 (iii) of Public Notice No. 60) and paragraph III(IV) of the MOU) 1842(2) (b) The "trade balancing" Requirement (paragraph 3 (iv) of Public Notice No. 60 and paragraph III (vi) of the MOU) 1844(5) B. Has The Matter Been Settled and Adjudicated? 1849(28) 1. Has the Matter Been Settled? 1852(8) 2. Has the Matter Already Been Adjudicated? 1860(17) (a) India - Quantitative Restrictions 1860(8) (i) The Notion of Res Judicata 1866(2) (b) The Provisions Are an Inherent Part of the Licensing Scheme that Must be Eliminated 1868(9) (i) The Notion of Abusive Splitting 1872(5) C. Are the Measures within the Terms of Reference of the Panel? 1877(21) 1. Do the Measures Applied After 1 April 2001 Fall Outside the Terms of Reference? 1877(21) (a) The Method of Enforcement before and after 1 April 2001 1880(18) D. Claims under GATT 1994 and TRIMs 1898(48) 1. Article III:4 1898(10) (a) The Indigenization Requirement 1900(5) (b) The Trade Balancing Requirement 1905(3) 2. Article XI:1 1908(28) (i) The Indigenization Requirement 1908(1) (ii) The Trade Balancing Requirement 1908(12) (a) Are the Measures Justified by Article XVIII:B of the GATT and Articles 3 and 4 of the TRIMs Agreement? 1920(30) (i) Procedural Requirements of the Balance of Payments Provisions 1924(1) (ii) Substantive Requirements of the Balance of Payments Provisions 1925(4) (iii) The Burden of Proof 1929(5) (iv) Relevance of the India - Quantitative Restrictions Case 1934(2) 3. TRIMs Agreement 1936(7) V. ARGUMENTS OF THE THIRD PARTIES 1943(3) 1. The Agreements Regarding the Indian Measures Must be Respected and Enforced 1943(1) 2. The Measures that India May Take by 1 April 2001 are not, and as a Matter of Logic Cannot be, Properly before the Panel 1944(1) 3. Prospective Measures 1945(1) VI. INTERIM REVIEW 1946(12) A. Comments on the Descriptive Part 1947(1) 1. Comments by the United States 1947(1) 2. Comments by India 1947(1) 3. Comments by the European Communities 1948(1) B. Comments on the Findings and Conclusions 1948(10) 1. Comments by the United States 1948(1) 2. Comments by the European Communities 1949(1) 3. Comments by India 1950(12) (a) General Comment in Respect of India's Procedural Rights in the Proceedings 1951(2) (b) India's Argument that the Matters Addressed in the Recommendations Section Should be Left to a Compliance Panel 1953(2) (c) India's Argument that the Panel could not "properly" Conclude that the Violation is Still in Existence 1955(2) (d) India's Argument that the Panel Inappropriately Prescribes a "retrospective" Remedy 1957(1) VII. FINDINGS 1958(81) A. Clarification of the Claims in the Course of the Proceedings and Requests for Preliminary Rulings 1959(3) B. Clarification of the Measures within the Terms of Reference of this Panel 1962(7) 1. Measures Identified in the Complainants' Requests for Establishment of a Panel 1963(2) 2. Evolution of the Measures in the Course of the Proceedings 1965(2) 3. Measures not within our Terms of Reference 1967(2) C. The Panel's Competence to Consider the Matter before it 1969(30) 1. Are any of the United States' Claims Barred by the Principle of res judicata? 1970(18) (a) Arguments of the Parties and Scope of India's Invocation of the Doctrine of res judicata 1970(1) (b) Role of India's Import Licensing System in the United States' Claims 1971(1) (c) General Approach to the res judicata Arguments 1972(16) (i) The Matter before this Panel 1977(2) (ii) The Matter Ruled on by the India - Quantitative Restrictions Panel 1979(2) (iii) Comparison between the Matter Ruled on by the India - QRs Panel and the Matter before this Panel 1981(1) A Comparison of the Measures Expressly Considered 1982(1) A Comparison of the Express Claims 1983(1) Are the Matters the Same? 1984(1) Conclusion 1987(1) 1. Has Any Part of the Matter before this Panel Been Settled Through a Mutually Agreed Solution? 1988(8) (a) The Mutually Agreed Solution in the India - Quantitative Restrictions Dispute with the EC 1988(1) (b) Relevance of Mutually Agreed Solutions in Subsequent Proceedings 1989(1) (c) The Scope of the Mutually Agreed Solution Between the European Communities and India 1990(5) (d) Conclusion 1995(1) 2. Measures to be Eliminated in the Course of Implementing the Results of the India Quantitative Restrictions Dispute and Abusive Splitting of a Dispute 1996(3) (a) Abusive Splitting 1996(1) (b) Unnecessary Litigation 1997(2) 3. Conclusion 1999(1) D. Order of Examination of the Claims 1999(4) E. Consistency of the Indigenization Condition with the GATT 1994 2003(10) 1. Claims under Article III:4 of GATT 1994 2004(8) (a) Like Products 2005(1) (b) "Laws, regulations or requirements" 2005(5) (i) The Notion of "requirement" within the Meaning of Article III:4 2006(2) (ii) The Indigenization Condition as a "requirement" 2008(2) (c) ...Affecting the Internal Sale, Offering for Sale, Purchase (...) of the Products 2010(1) (d) Whether Imported Products are Accorded Less Favourable Treatment 2010(2) (e) Conclusion 2012(1) 2. Claim under Article XI 2012(1) F. GATT Claims Concerning the Trade Balancing Condition 2013(26) 1. Factual Aspects of the Measure 2013(1) 2. Order of Analysis of the Claims 2014(1) 3. Relationship between Articles III and XI 2015(1) 4. Claims under Article XI:1 2016(14) (a) Scope of the European Communities' Claim 2016(4) (i) The Scope of the Trade Balancing Obligation 2017(2) (ii) The Continued Enforceability of the MOUs after 1 April 2001 2019(1) (b) Arguments of the Parties 2020(1) (c) Scope of Article XI:1 2021(4) (i) The Notion of "measures" within the Meaning of Article XI:1 2021(2) (ii) "Restriction on importation" within the Meaning of Article XI:1 and "border measures" 2023(2) (d) The Trade Balancing Condition as a "restriction ... on importation" 2025(7) (i) The Notion of "restriction ... on importation" 2025(4) (ii) Analysis of the Trade Balancing Condition 2029(1) 5. Balance-of-Payments Defense 2030(2) 6. Claims under Article III:4 2032(4) (a) Purchases of Restricted Imported Kits and Components on the Domestic Market 2033(3) (i) Like Products 2034(1) (ii) Laws, Regulations or Requirements 2034(1) (iii) Affecting Internal Sale, Use, 2034(2) (iv) Whether the Measure Affords Less Favourable Treatment to Imported Products 2036(1) 7. Ruling on the Consistency of Public Notice No. 60 with the GATT 1994 2036(4) (a) Consistency of Public Notice No. 60 with Article III:4 of GATT 1994 2037(1) (b) Consistency of Public Notice No. 60 with Article XI:1 of the GATT 1994 in so far as it Contains the Trade Balancing Condition 2038(1) G. Claims under the TRIMs Agreement 2039(1) VIII. CONCLUSIONS AND RECOMMENDATIONS 2039(15) A. Conclusions 2039(1) B. Consequences of Events Having Taken Place in the Course of the Proceedings 2040(13) 1. Presentation of the Issue: Arguments of the Parties 2040(3) 2. Approach of the Panel 2043(3) 3. Analysis 2046(7) (a) Indigenization Provisions 2047(4) (i) The Cessation of the Application of Public Notice No. 60 and the MOUs as Private Contracts 2048(2) (ii) Achievement of the Required Levels of Indigenization by MOU Signatories 2050(1) (b) Trade Balancing Provisions 2051(2) (i) Accrued Obligations as Independent from Imports 2051(1) (ii) Cessation of the Application of Public Notice No. 60 and the MOUs as Private Contracts 2052(1) C. Recommendations 2053(1) TABLE 1 2054(3) TABLE 2 2057(4) United States - Definitive Safeguard Measures on Imports of Circular Welded Carbon Quality Line Pipe from Korea (WTIDS202) Award of the Arbitrator under Article 21.3(c) of the DSU 2061(2) Cumulative Index of Published Disputes 2063