WTO Panel Rules Against Aspects Of EU Restrictions On The Importing And Marketing Of Seal Products

Keywords: WTO panel, EU restrictions, import, marketing, seal products

On November 25, 2013, a World Trade Organization (WTO) dispute settlement panel issued its report in EC - Measures Prohibiting the Importation and Marketing of Seal Products (WT DS400/R; WT/DS401/R) relating to complaints raised by Canada and Norway against regulations promulgated by the European Union (EU) concerning the importing and marketing of seal products (the "Seal Regime").

The panel found that the EU's Seal Regime did not conform with Article 2.1 of the WTO Agreement on Technical Barriers to Trade (TBT Agreement) or with Article III.4 of the General Agreement on Tariffs and Trade 1994 (GATT 1994). The panel did find, however, that the Seal Regime was consistent with Article 2.2 of the TBT Agreement. The panel recommended that the WTO Dispute Settlement Body request the EU to bring the inconsistent measures into conformity with its obligations under the TBT Agreement and GATT 1994.

Background

The dispute stems from complaints filed by Canada and Norway against EU regulations that prohibit seal products from the EU market unless they satisfy certain conditions/exceptions. The first condition/exception concerns products obtained from seals hunted by Inuits or indigenous communities (the IC condition/exception); the second concerns seals hunted as part of an official marine resource management program (the MRM condition/exception); and the third concerns travellers who can bring seal products into the EU in limited circumstances (the travellers condition/exception).

A majority of the seal products exported from Canada and Norway into the EU do not comply with these conditions/exceptions, as most seal hunting in these countries is undertaken for different reasons (which the WTO panel categorized as "commercial hunts"). As a result, most of their exports into the EU market were prohibited by the Seal Regime.

Claims Under the TBT Agreement

Article 2.1

Canada alleged that the IC and MRM conditions violated Article 2.1 of the TBT Agreement by discriminating against its seal imports compared with seal products from EU Member countries. Specifically, it claimed that the IC and MRM conditions accorded seal products from Canada (imported products) treatment less favorable than that accorded to like seal products of domestic origin, mainly from Sweden and Finland (domestic products), as well as those of other foreign origin, particularly from Greenland (other foreign products).

The panel first considered whether the imported and domestic/other foreign seal products at issue were "like" products, as Canada claimed, or whether, as the EU claimed, seal products hunted by commercial, IC or MRM method should be compared against seals hunted under the equivalent condition. The panel referred to the Appellate Body report in United States - Clove Cigarettes, which compared clove cigarettes (the product subject to the challenged import ban) with menthol cigarettes (the domestic product which was exempted from the ban). It noted that even though certain nonclove cigarettes from Indonesia were exempted from the ban, this was not considered relevant given that the "vast majority" of Indonesia's exports comprising clove cigarettes were negatively affected vis-à-vis the "vast majority" of the...