Jul 16, 1992

PANEL ESTABLISHED OVER U.S. TUNA LEGISLATION.

GENEVA, JULY 14 (CHAKRAVARTHI RAGHAVAN) -- The GATT Council Tuesday agreed to a request from the European Community and established a panel to look into the dispute with the U.S. over the U.S. laws restricting imports of tuna on grounds of protecting dolphin.

An earlier GATT panel had ruled against the United States on this issue in a dispute raised by Mexico and before which the EC and a number of other countries had intervened as interested parties. The U.S. restrictions apply not only to countries that it holds are using fishing techniques prohibited under its dolphin protection laws, but other countries who import such tuna and export processed tuna to the U.S.

However, after the panel ruling, Mexico and the U.S. have said they are holding bilateral consultations to settle the dispute and in effect the adoption of the panel ruling has been blocked.

The EC, as an interested party some of whose members are covered by the secondary restrictions thereafter raised a fresh dispute and this was referred to a panel.

In agreeing to the pane, the U.S. told the Council that legislation to give effect to the GATT ruling was before Congress and the administration expected this to be acted upon soon and hence there should be no panel.

The EC however said that the amending legislation was still in the arena of "expectations" and a panel should hence be established. Any developments in the U.S. legislation could be taken note of at any stage by the panel or the two disputants, it noted.

In other developments, the U.S. sought authorisation from the Council to retaliate against Canada by withdrawal of equivalent concessions over what it terms Canada's tardiness in implementing a panel ruling against it over the discriminatory rules and practices of Canadian provincial marketing boards in respect of imported beverages like beer and alcohol.

The U.S. said that not only had there been tardiness, but that some of the provincial boards like those of Toronto and Quebec had introduced new measures that discriminated against imported U.S. beer. It cited in this connection levies over U.S. beer sold in cans, levies put in place purportedly on environmental grounds. The U.S. estimated an annual loss to the U.S. beer exporters of $ 80 million per annum over 1988-1990.

Canada countered this by saying that the levies applied to all products, imported and domestic, which were in non-reusable containers. Bilateral consultations were still continuing and it was not appropriate for the Council at this stage to authorise retaliation.

In other decisions, the Council agreed to set up a working party to go into the application of Slovenia to accede to the GATT. Its request that it be allowed to accede as a former constituent of Yugoslavia was not accepted by other CPs.

A separate working party was also established to go into the agreements between EFTA and Czechoslovakia and that between Sweden and the Baltic States of Estonia, Latvia and Lithuania.

The Council was also advised that Arthur Dunkel, whose term as GATT DG ends at end of 1992 and who had earlier said he would not accept another terms, would now continue as Director-General till July 1993 and his contract would be extended accordingly.

The Council also discussed the semi-annual report of Dunkel on the status of panels and their implementation.

Several participants noted that most of the disputes were among the four major trading partners, each of whom was holding up adoption of a panel report or were tardy in its implementation. A number of countries, both the smaller ICs and the developing nations, said that their ability to take on more obligations would be made easier if the existing rights of parties were better observed and panel rulings accepted and implemented.