Third Participant Submission of Australia, Executive Summary
22 September, 2003
Third Party Submission by Australia
1. Australia welcomes this opportunity to present its views
to the Appellate Body in this appeal on Japan - Measures Affecting the
Importation of Apples. In this submission, Australia has provided legal
arguments in support of its position on a number of the allegations of errors
on issues of law covered in the panel report and legal interpretations developed
by the Panel raised by Japan and the United States as appellants.
II. Executive Summary
The relationship between Articles 2.2, 5.1 and 5.7 of the SPS Agreement
2. The Panel made several errors of law in its interpretation
and application of the obligations under Articles 2.2, 5.1 and 5.7 (discussed
below). Many of these errors appear to have resulted from an incorrect
understanding of the relationship between these Articles, and consequently,
an incorrect interpretation of the scope and purpose of each of the Articles.
In particular, as a result, the Panel has imported into Article 2.2 obligations
which are addressed under Article 5.1, and has incorrectly limited the application
of Article 5.7.
Interpretation and Application of Article 2.2 of the SPS Agreement
3. The Panel made several errors of law in its interpretation
and application of the obligation in Article 2.2 for a Member to ensure that
any SPS measure is not maintained without sufficient scientific evidence (hereafter,
“the third element of Article 2.2”).
4. The Panel incorrectly introduced a requirement into Article
2.2 that SPS measures be “justified” by the relevant scientific
evidence and not be “disproportionate” to the identified risk.
The Panel's interpretation is not supported by the text of Article 2.2 and
undermines the recognised right of Members to determine their appropriate
level of sanitary and phytosanitary protection and to take measures to achieve
that level of protection.
5. The Panel misinterpreted the third element of Article 2.2
as requiring that the scientific evidence must both establish the existence
of a phytosanitary risk and justify the measure. In Australia's view,
the correct standard for the relationship in Article 2.2 between the scientific
evidence and the sanitary or phytosanitary risk is that the scientific evidence
must establish that the risk addressed in the measure has been the subject
of scientific study and that as a result of such study there is a body of
available scientific evidence which is sufficient in quality and quantity
to allow for an assessment of risks as required under Article 5.1 and as defined
in Annex A. The Panel's expansive view of the third element of
Article 2.2 may have also resulted from its misinterpretation of the term
“not maintained without” in the phrase “not maintained without
sufficient scientific evidence” as being equivalent to “not supported
6. In applying Article 2.2, the Panel erroneously relieved the
United States of its burden in relation to a claim of inconsistency with the
third element of Article 2.2 and, in doing so, failed to make any assessment
of whether the United States had raised the necessary presumption with regard
to the issue of completion of a pathway and the spread of disease through
infected apple fruit. The Panel also erred by engaging in
analysis and making findings on claims not pursued by the United States concerning
apples other mature symptomless apples. As a result of this error, the
Panel's overall finding on the specific legal claim made by the United States
concerning the consistency with Article 2.2 of Japan's measure (which on its
terms applies to all US apples) should be reversed as there is no factual
basis upon which to determine whether the United States made a prima facie
case on that specific legal claim.
Interpretation and Application of Article 5.7 of the SPS Agreement
7. In imposing the burden of proof in relation to Article 5.7
of the SPS Agreement on Japan, the Panel erred in law. Article 5.7 establishes
both a right and obligation of Members and does not stand in a “general
rule-exception” relationship with Article 2.2. Article 2.2 simply
excludes from its scope of application the kinds of situations covered by
Article 5.7. Article 5.7 establishes a Member's right to take provisional
sanitary or phytosanitary measures in cases where relevant scientific information
is insufficient. As Article 5.7 contains a “positive rule
establishing obligations”, the burden of proof to establish a prima
facie case of inconsistency rests with the complaining party.
8. Article 5.7 applies “in cases where relevant scientific
evidence is insufficient”. The Panel erred in its interpretation
of this phrase. Consistent with Australia's views on the interpretation
of Article 2.2 of the SPS Agreement, it considers that the threshold requirement
for Article 5.7 would be met in instances where the relevant scientific evidence
is insufficient to meet the obligation in Article 5.1 (and the third element
of Article 2.2). That is, where the relevant scientific evidence is
insufficient to base sanitary or phytosanitary measures on an assessment of
the risks to human, animal or plant life or health.
Interpretation of Article 5.1 of the SPS Agreement
9. The Panel made several errors in its legal interpretation
of Article 5.1. In requiring a risk assessment to be specific to the
product at issue, the Panel erroneously created a new standard for “specificity”
in a risk assessment that is not warranted by the text of the SPS Agreement.
To the extent that the definition of a risk assessment in Annex A can be said
to require a certain level of detail or specificity in a risk assessment,
that requirement relates to the identification of the risk at issue, not to
the product at issue.
10. In examining the sufficiency of Japan's risk assessment,
the Panel considered, erroneously in Australia's view, that there was a linkage
between the flexibility provided under the term “as appropriate to the
circumstances” in Article 5.1 and the definition of a “Risk Assessment”
in Paragraph 4 of Annex A. While this term offers some flexibility
in the manner in which a risk assessment is carried out, it cannot, as implied
by the Panel, be interpreted to annul or supersede the substantive requirements
for a valid risk assessment.
11. There is no legal or textual basis for the Panel's view
that a completed risk assessment, which meets the requirements of Article
5.1 and paragraph 4 of Annex A, must be reviewed or renewed in light of subsequent
evidence. Subsequent evidence cannot alter the extent to which a completed
risk assessment satisfies the requirements of Article 5.1 and paragraph 4
of Annex A. Subsequent evidence is, however, relevant to a panel's objective
assessment, at the time of its inquiry, as to whether measures have
been based on an assessment of risk consistent with Article 5.1, and
as to whether the requirement to take into account “available scientific
evidence” in Article 5.2 has been met. It follows that it would
be possible for a previously completed risk assessment to comply fully with
the requirements for a valid risk assessment under Article 5.1, but nevertheless
not be sufficiently up-to-date from an evidentiary perspective to satisfy
a Panel at the time of its inquiry that the requirements of Articles 5.1 and
Article 5.2 have been met.
Objective Assessment under DSU Article 11
12. In its Appellant Submission, Japan alleges that the
Panel failed to make an objective assessment of the matter as required by
Article 11 of the DSU. Australia considers that Japan's allegations
have merit and deserve close attention. In particular, the Panel failed
to consider all relevant evidence in its examination of Japan's measure and
its conformity with Article 5.1 of the SPS Agreement. Despite its statement
in paragraph 8.248, the Panel focused solely on Japan's 1999 PRA, and did
not provide any explanation for its treatment of other evidence in its reasoning.
In failing to provide adequate reasoning to support is finding, the Panel
failed to meet the criteria for an objective assessment of the matter.