PÉREZ DEL CASTILLO OFFICIALLY ENTERS DG RACE

On 1 December, Uruguay officially nominated Ambassador Carlos Pérez del Castillo to the post of Director-General of the WTO. In his nomination letter, Ambassador Guillermo Valles Galmés of Uruguay noted that Pérez del Castillo would be a suitable candidate given his background as a citizen of a small developing country known as a consensus builder and for understanding the importance of multilateralism. In addition, a candidate from Latin America has never held the post of WTO Director General. The nomination letter also pointed out that Uruguay has already sounded out the Membership with regard to Pérez del Castillo's candidature, and that he has the benefit of "extensive formal support in Latin America as well as in other developing regions and the industrialised world".

The successor to Director-General Supachai Panitchpakdi is scheduled to be selected by the end of May 2005, in order to enable a smooth transition for the new Director-General in early September, well in advance of the December 2005 Ministerial Conference in Hong Kong. Several candidates have entered the race, informally and formally (see BRIDGES Weekly, 13 October 2004).

ICTSD reporting.

At a 30 November meeting of the special (negotiating) session of the Council for Trade-related Aspects of Intellectual Property Rights (TRIPS), WTO Members found common ground on some aspects of the proposed multilateral register for geographical indications for wines and spirits. Members agreed that notification of protection should provide flexibility to allow for different countries' legal approaches. They also agreed that the notification procedure should be simple, brief, transparent, easily accessible, and that users could pay the costs. Members also agreed that the WTO Secretariat could administer the register. The EU suggestion to retain WIPO as a possible administering body was opposed by "new world" countries including Argentina, Australia, Canada, Chile, the US and others.

Members were unable to make headway on whether the protection of registered terms should be voluntary or obligatory, and whether Members who do not register a term -- or do not even participate in the proposed register -- would nevertheless be obliged to protect it if it has been registered by others. Members fell into old negotiating positions, with the "new world" countries supporting a more voluntary, database-like system, and the EU pushing for a more rigid scheme (see BRIDGES Weekly, 29 September 2004). The meeting was sparsely attended and operated in informal mode.

The next "TRIPS weeks" are planned for April, June and October 2005.

ICTSD reporting.

On 26 November, the WTO's Dispute Settlement Body (DSB) gave permission to seven WTO Members to impose retaliatory duties on US imports. This came as a result of the US' failure to comply with a ruling that found an aspect of its anti-dumping practices illegal. Under the so called Byrd Amendment -- the popular name for the US Continued Dumping and Subsidy Offset Act of 2000 (CDSOA) -- foreign firms selling their products below cost in the US could be fined, and the money thus collected redistributed to the US companies that initiated the complaint. This redistribution scheme was ruled illegal by a WTO panel in January 2003 (see BRIDGES Weekly, 22 January 2003).

The DSB's approval followed the US retraction of an earlier demand that six of the seven Members modify the language in their separate retaliation requests. The US had argued that the absence of such modifications would allow the six to impose sanctions above the authorised levels fixed by a WTO arbitrator in August (see BRIDGES Weekly, 8 September 2004). The six Members -- Brazil, Canada, the European Union, India, Japan and South Korea-- rejected the US request on the basis that it had no merit. The impasse was resolved when the US agreed to accept a statement from DSB Chair Amina Mohamed of Kenya proposing that the DSB agree to authorise retaliation in line with the awards set out in the arbitration rulings.

ICTSD Reporting; "WTO Gives Green Light to Byrd Sanctions; U.S. Drops Objections to Request Language", WTO Reporter, 29 November 2004; "WTO Imposes Penalties on US Exports," China View, 19 November 2004.

During the last special (negotiating) session of the Dispute Settlement Body (DSB) for the year on 25-26 November, discussion focused on the informal 'package deal' (JOB (04)/52) submitted by Norway and four other countries during the 28 May 2004 special session (see BRIDGES Weekly, 2 June 2004). Unlike the 28 May session, Members showed considerable interest in the proposal. Discussions were more detailed, although there was no emerging consensus on any of the three proposals outlined in the deal -- sequencing, remand and post-retaliation issues. Notably, there was very little engagement on the package deal by the US, which took the view that the issue of 'sequencing' did not present any problems that needed to be fixed. Likewise, the EC disagreed with the proposal's 'sequencing' suggestion that either party to a dispute be allowed to seek a panel to determine if the offender had complied with a ruling -- a right that is currently available only to the complaining party. The proponents of the package deal agreed to address the technical questions and concerns Members had raised and continue discussion in 2005. Thus, the Chair, Ambassador David Spencer of Australia, concluded the dispute settlement talks for 2004 with no harvest in sight.

Negotiations to improve and clarify the WTO rules on disputes -- the Dispute Settlement Understanding Review (DSU Review) mandated by the Doha Ministerial Declaration -- have been sluggish so far, with a lack of political will from WTO Members to reach a consensus on proposals submitted. Argentina, Brazil, Canada, India, New Zealand and Norway introduced the informal set of proposals in response to the chair's invitation to Members to work among themselves outside the sessions to bridge differences and achieve consensus. The 'package deal' covered three systemic issues; equipping the Appellate Body with a 'remand' authority to send a complaint back to the original panel for clarification on factual issues; 'sequencing' trade sanctions and compliance rulings so that a party that wishes to request sanctions against an offender will have to await a WTO compliance panel decision affirming that the offender in question has not implemented the ruling; and 'post-retaliation' procedures for the removal of previously authorized trade sanctions.

ICTSD reporting.