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Terms of Reference of Panels: Art. 7

 Another Panel in Brazil-Aircraft (DS46) follows a similar line:3
 “We recall that our terms of reference are based upon Canada''s request for establishment of a panel, and not upon Canada''s request for consultations. These terms of reference were established by the DSB pursuant to Article 7.1 of the DSU and establish the parameters for our work. Nothing in the text of the DSU or Article 4 of the SCM Agreement provides that the scope of a panel''s work is governed by the scope of prior consultations. Nor do we consider that we should seek to somehow imply such a requirement into the WTO Agreement. One purpose of consultations, as set forth in Article 4.3 of the SCM Agreement, is to ‘clarify the facts of the situation’, and it can be expected that information obtained during the course of consultations may enable the complainant to focus the scope of the matter with respect to which it seeks establishment of a panel. Thus, to limit the scope of the panel proceedings to the identical matter with respect to which consultations were held could undermine the effectiveness of the panel process.
 
     We do not believe, however, that either Article 4.7 of the DSU or Article 4.4 of the SCM Agreement requires a precise identity between the matter with respect to which consultations were held and that with respect to which establishment of a panel was requested.”
 This ruling is confirmed by the Appellate Body: “We do not believe, however, that Articles 4 and 6 of the DSU, or paragraphs 1 to 4 of Article 4 of the SCM Agreement, require a precise and exact identity between the specific measures that were the subject of consultations and the specific measures identified in the request for the establishment of a panel.” 4
 In short, panel’s terms of reference are determined, not with reference to the request for consultations, or the content of the consultations, but only with reference to the request for the establishment of a panel.


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