to find expression’. The Panel considers that in accepting the WTO Agreement Members also accept a priori, through the introduction of these general exceptions, that Members will be able, at some point, to have recourse to these exceptions. Moreover, Members have attached to the use of these exceptions a certain number of conditions contained either in paragraphs (a) to (j) or in the introductory clause of Article XX. These conditions have generally been narrowly interpreted. The result is that (a)both the intended objective of these exceptions (pursuit of interests recognized a priori as being of greater importance than Members'' commercial interests, since they can outweigh the latter) and (b)the specific conditions that must be satisfied by Members invoking these exceptions mean that, while recognizing that Article XXIII:1(b) applies to measures that fall under Article XX, we are justified in treating recourse to Article XIII:1(b) as particularly exceptional in relation to measures justified by Article XX(b).
All this leads the Panel to consider that, in practice, even if in a particular case a mutually satisfactory adjustment may be made under Article XXIII:1(b), in general, the risk of an effective increase in the cost of measures necessary to protect public health because of the applicability of Article XXIII:1(b) to measures justified under Article XX can only be very marginal. In fact, considering the criteria mentioned in the previous paragraph, very few measures of this kind could give rise to the application of Article XXIII:1(b).
For these reasons we do not subscribe to the interpretation proposed by the European Communities. Accordingly, we will continue our examination of the measure in the light of Article XIII:1(b) of the GATT 1994.”
The European Communities contends that the Panel erred in finding that Art. XXIII:1(b) applied to measures pursuing health objectives, rather than commercial ones, and which could, therefore, be justified under Art. XX(b) of the GATT 1994. In this respect, the Appellate Body finds that:10
“The European Communities also contends that the Panel erred in finding that Article XXIII:1(b) applies to measures which pursue health, rather than commercial, objectives and which can, therefore, be justified under Article XX(b) of the GATT 1994. Once again, we look to the text of Article XXIII:1(b), which provides that ‘the application by another Member of any measure’ may give rise to a cause of action under that provision. The use of the word ‘any’ suggests that measures of all types may give rise to such a cause of action. The text does not distinguish between, or exclude, certain types of measure. Clearly, therefore, the text of Article XXIII:1(b) contradicts the European Communities'' argument that certain types of measure, namely, those with health objectives, are excluded from the scope of application of Article XXIII:1(b).
In any event, an attempt to draw the distinction suggested by the European Communities between so-called health and commercial measures would be very difficult in practice. By definition, measures which affect trade in goods, and which are subject to the disciplines of the GATT 1994, have a commercial impact. At the same time, the health objectives of many measures may be attainable only by means of commercial regulation. Thus, in practice, clear distinctions between health and commercial measures may be very difficult to establish. Nor do we see merit in the argument that, previously, only ‘commercial’ measures have been the subject of Article XXIII:1(b) claims, as that does not establish that a claim cannot be made under Article XXIII:1(b) regarding a ‘non-commercial’ measure.
An important aspect of the European Communities'' argument is that a Member cannot have reasonable expectations of continued market access for products which are shown to pose a serious risk to human life or health. However, the paragraphs of the Panel Report appealed by the European Communities involve exclusively the Panel''s findings on the threshold issues of the scope of application of Article XXIII:1(b). This particular argument of the European Communities, important as it is, simply does not relate to those threshold issues. Rather, the European Communities'' argument relates to the substance of a claim that has been determined to fall within the scope of application of Article XXIII:1(b) and, in particular, concerns the issue whether a ‘benefit’ has been ‘nullified or impaired’ by a measure restricting market access for products posing a health risk. Here, we emphasize that the European Communities does not appeal the Panel''s findings relating to the ‘nullification or impairment’ of a ‘benefit’ through the frustration of reasonable expectations by application of the measure at issue. We do not, therefore, find it necessary to examine the European Communities'' argument relating to reasonable expectations.
For these reasons, we dismiss the European Communities'' appeal under Article XXIII:1(b) of the GATT 1994 and uphold the Panel''s finding that Article XXIII:1(b) applies to measures which fall within the scope of application of other provisions of the GATT 1994 and which pursue health objectives. ”
(iv)Measures Applied Continuingly
Given that the text of Art. XXIII:1(b) contemplates nullification or impairment in the present tense, caused by application of a measure, “whether or not it conflicts” (also in the present tense), the ordinary meaning of this provision limits the non-violation remedy to measures that are currently being applied. In only a very small number of cases, involving very particular situations, have panels proceeded to adjudicate claims involving measures which no longer exist or which are not being applied any longer. In those cases, the measures have been typically applied in the very recent past. For example, in Japan-Film (DS44), the parties disagree as to whether or not certain of the “measures” at issue are still in effect. In this respect, the Panel rules that:11
“
Given the significance of the principle of continued application of measures to the interpretation of Article XXIII:1(b), we shall need to give particularly careful analysis -- in examining the individual ‘measures’--to the evidence relating to such alleged continuing administrative guidance. At this stage, suffice it to say that we do not rule out the possibility that old ‘measures’ that were never officially revoked may continue to be applied through continuing administrative guidance. Similarly, even if measures were officially revoked, the underlying policies may continue to be applied through continuing administrative guidance. However, the burden is on the United States to demonstrate clearly that such guidance does in fact exist and that it is currently nullifying or impairing benefits.”
IIIExistence of a Benefit: Protection of Legitimate Expectations
(i)Protection of Legitimate Expectations(PLE)
As discussed previously, it is ruled that the non-violation remedy has an important role - that of protecting the reasonable expectations of competitive opportunities through negotiated concessions.
In this regard, the Panel in Japan - Film(DS44)rules that: “The second required element which must be considered to establish a case of non-violation nullification or impairment under Article XXIII:1(b) is the existence of a benefit accruing to a WTO Member under the relevant agreement (in this case, GATT 1994). In all but one of the past GATT cases dealing with Article XXIII:1(b) claims, the claimed benefit has been that of legitimate expectations of improved market-access opportunities arising out of relevant tariff concessions. This same set of GATT precedents suggests that for expectations to be legitimate, they must take into account all measures of the party making the concession that could have been reasonably anticipated at the time of the concession. Of course, as with the first element (application of a measure), the complaining party has the burden of demonstrating the ‘benefit accruing’.”12 And the Panel goes on to analyze:13
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