Case study
Download
1 / 37

Case Study - PowerPoint PPT Presentation


  • 274 Views
  • Updated On :

Case Study. Dominican Republic – Measures Affecting the Importation and Internal Sale of Cigarettes 蔡奉真、黃琳君、李炎蒼. Parties and measure in dispute. parties : Dominican Republic  Honduras Measure in dispute : 一、多明尼加要求於該國境內銷售之香菸,不論是否進口產品,包裝上均應貼上印花,以證明已經繳稅得以合法銷售。

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'Case Study' - Renfred


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
Case study l.jpg
Case Study

Dominican Republic – Measures Affecting the Importation and Internal Sale of Cigarettes

蔡奉真、黃琳君、李炎蒼


Parties and measure in dispute l.jpg
Parties and measure in dispute

  • parties:

  • Dominican Republic  Honduras

  • Measure in dispute:

  • 一、多明尼加要求於該國境內銷售之香菸,不論是否進口產品,包裝上均應貼上印花,以證明已經繳稅得以合法銷售。

  • 二、多明尼加針對香菸的進口或銷售,要求進口商或國內製造商均應提供相同金額的保證金,以保證稅款的繳納。


Slide3 l.jpg
事件經過

  • 2004/1/9 Panel established

  • 2004/11/26Panel Report

  • 2005/1/24 Dominican Republic notified the DSB of its intention to appeal

  • 2005/1/31 Dominican Republic filed its appellant’s submission

  • 2005/2/7 Honduras notified the DSB of its intention to appeal

  • 2005/3/8 Honduras filed its other appellant’s submission

  • 2005/4/25 Appellate Body Report


Issues raised in this appeal l.jpg
Issues Raised in this Appeal

  • 1.多明尼加印花措施的必要性

  • 2.panel是否未審酌多明尼加提出之證據

  • 3.panel對於宏都拉斯所提,多明尼加保證金措施造成的效果判斷是否有誤

  • 4.panel對於宏都拉斯對多明尼加保證金措施之主張是否適當

  • 5.panel對於多明尼加收稅時機之相關判斷是否有誤


Slide5 l.jpg
相關法條

  • 1.GATT 1994 Article XX(d): Subject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between countries where the same conditions prevail, or a disguised restriction on international trade, nothing in this Agreement shall be construed to prevent the adoption or enforcement by any contracting party of measures: (d) necessary to secure compliance with laws or regulations which are not inconsistent with the provisions of this Agreement, including those relating to customs enforcement, the enforcement of monopolies operated under paragraph 4 of Article II and Article XVII, the protection of patents, trade marks and copyrights, and the prevention of deceptive practices


Dsu article 11 function of panels l.jpg
DSU Article 11: Function of Panels

  • The function of panels is to assist the DSB in discharging its responsibilities under this Understanding and the covered agreements. Accordingly, a panel should make an objective assessment of the matter before it, including an objective assessment of the facts of the case and the applicability of and conformity with the relevant covered agreements, and make such other findings as will assist the DSB in making the recommendations or in giving the rulings provided for in the covered agreements. Panels should consult regularly with the parties to the dispute and give them adequate opportunity to develop a mutually satisfactory solution.


Article iii national treatment on internal taxation and regulation l.jpg
Article III:National Treatment on Internal Taxation and Regulation

  • 4. The products of the territory of any contracting party imported into the territory of any other contracting party shall be accorded treatment no less favourable than that accorded to like products of national origin in respect of all laws, regulations and requirements affecting their internal sale, offering for sale, purchase, transportation, distribution or use. The provisions of this paragraph shall not prevent the application of differential internal transportation charges which are based exclusively on the economic operation of the means of transport and not on the nationality of the product.


Abbreviations l.jpg
Abbreviations

  • Adjudicators and parties:

    • Panel: P

    • Appellate Body: AB

    • Dominican Republic: DR

    • Honduras: H


The necessity analysis under art xx d in relation to the tax stamp requirement l.jpg

The Necessity Analysis under Art.XX(d) in relation to the Tax Stamp Requirement


Panel s decision l.jpg
Panel’s Decision

  • Stamp requirement: inconsistent with national treatment (Art. III.4)

  • Additional processes and cost for imported product, leads to imported cigarette being presented to final consumers in a less appealing manner. (DR did not appeal.)

    2. Falls within the scope of Art. XX(d)? (-)

  • Whether the measure is necessary to

    • Secure compliance with DR tax law

    • Fight tax evasion

    • Prevent smuggling


Standards for analyzing necessity l.jpg
Standards for analyzing “necessity”


Appeal 1 2 l.jpg

Arguments form DR

P erred in interpreting and applying the term “necessary”

Korea-Various Measures on Beef standard: weighing and balancing a series of factors

The trade impact

The importance of interest protected

The contribution of the measure

Alternative measure

In the presence of a “tax inspector” ensure the authentic tax stamps, reducing smuggling cigarettes

No reasonably available alternative: increase the risk of smuggling and tax evasion

Appeal (1/2)


Appeal 2 2 l.jpg

Arguments from H

DR’s claim should be rejected.

DR’s new decree: permit to affix tax stamp abroad no alternative measure?

AB: two –tier analysis

(1)provisional justification by reason of characterization of the measure under XX(a)~(j)

Art.XX(d)—Korea -beef

Secure compliance

Necessary(Korea-beef/ US-Section 337/EC-Asbestos )

(2)further appraisal under the introductory clause of Art.XX.

Appeal(2/2)


Ab s conclusion l.jpg
AB’s Conclusion

1.the tax stamp is not “necessary” within the meaning of Art.XX(d) of the GATT, therefore, is not justified under Art.XX(d) of the GATT.

2. no need to complete legal analysis under Art.XX.



Appeal 1 216 l.jpg
Appeal(1/2) the DSU

  • DR’s argument

    • DR-8, DR-29 indicate that in the case of alcohol, there is smuggling of alcohol as well as the forgery of tax stamp.

  • AB

    • determination of the credibility and weight properly to be ascribed to a given piece of evidence is … left to the discretion of panel as the trier of facts. (EC-Hormones) P enjoys a “margin of discretion” as triers of fact

    • [P is] “not required to accord to factual evidence of the parties the same meaning and weight as do the parties.”(Australia-Salmon)


Appeal 2 217 l.jpg
Appeal(2/2) the DSU

  • AB does not “second-guess” the P in appreciating either evidentiary value of …studies or the consequences…(EC-Asbestos)

  • …inconsistency under Art.11…we must be satisfied that the P has exceeded the bounds of its discretion, …, in appreciation of the evidence.(US-Wheat Gluten)

    where participants…have failed to establish that a P exceeded the bounds of its discretion as trier of facts, the AB has not interfered with the findings of the P.


Ab s ruling l.jpg
AB the DSU ’s Ruling


Ab s conclusion19 l.jpg
AB the DSU ’s Conclusion

  • P did not fail to comply with the obligations set out in Art.11 of the DSU.



Issue l.jpg
Issue the DSU

  • Per-unit cost of the bond: cost of bond(5 million )/ volume of sale

  • Standard in determine “less favorable treatment”

    • Whether a measure modifies the conditions of competition in the relevant market to the detriment of imported products. (Korea-Various Measure on Beef)

    • Protection of the group of “like” domestic products.(EC-Abestos)


Ab s conclusion23 l.jpg
AB the DSU ’s Conclusion

1. Difference in per-unit cost of bond does not alter the conditions of competition, that fact does not constitute a less favorable treatment to imported products.

2. No violation of Art. III.4 no need to inspect Art.XX(d)


Panel s consideration of the bond requirement as such l.jpg
Panel the DSU ’s Consideration of the Bond Requirement “as such”

  • Art. 11 of the DSU & Art.III:4 GATT

  • Parties’ arguments

  • Panel’s statement

  • AB’s statement


Art 11 of the dsu l.jpg
Art. 11 of the DSU the DSU

  • “…Accordingly, a panel should make an objective assessment of the matter before it, including an objective assessment of the facts of the case…”


Art iii 4 gatt 1994 l.jpg
Art.III:4 GATT 1994 the DSU

  • The products of the territory of any contracting party imported into the territory of any other contracting party shall be accorded treatment no less favourable than that accorded to like products of national origin in respect of all laws, regulations and requirements affecting their internal sale, offering for sale, purchase, transportation, distribution or use. The provisions of this paragraph shall not prevent the application of differential internal transportation charges which are based exclusively on the economic operation of the means of transport and not on the nationality of the product.


Panel s statement l.jpg
Panel the DSU ’s statement

  • For the reasons expressed above, the Panel is not convinced by Honduras's argument that the bond requirement results in a less favourable treatment for imported cigarettes, because for those cigarettes there is no liability that the bond requirement would serve to secure


Parties arguments l.jpg

Honduras the DSU

the inconsistency of the bond requirement with Article III:4 of the GATT 1994 was that the bond requirement served to guarantee liability only for the Selective Consumption Tax and that such liability did not exist for importers, who must pay that tax in full at the time of importation.

Dominican

notwithstanding payment of the Selective Consumption Tax at the time of importation, the bond nevertheless served to secure payment of that tax in the event of an adjustment of the taxpayers' total liability at some point

although Article 376 of the Tax Code appears to refer only to the Selective Consumption Tax, in practice [the Dominican Republic] tax authority treats the bond as a guarantee of compliance with other internal tax obligations incumbent on the domestic producer and the importer of cigarettes,

Parties’ arguments


Ab s statement l.jpg
AB the DSU ’s statement

  • Chile – Price Band System

  • Panel found no reason to question the assertion of the Dominican Republic authorities…

  • US – Carbon Steel

  • we agree with Honduras that consideration of the express wording of the text of legislation establishing a measure is a fundamental element of an assessment of that legislation. That said, however, we see no merit in the proposition advanced by Honduras that a panel must limit itself


Timing of payment of the selective consumption tax l.jpg
Timing of Payment of the Selective Consumption Tax the DSU

  • Art.III:4 GATT 1994

  • Parties’ argument

  • Panel’s statement

  • AB’s statement


Panel s statement31 l.jpg
Panel the DSU ’s statement

  • ... that Honduras's claim regarding the different costs for domestic producers and importers arising from the time of payment of the Selective Consumption Tax is not directly related with the bond requirement and it is not within the Panel's terms of reference

  • Honduras' argument regarding the timing of payment for the Selective Consumption Tax and the two responses from the Dominican Republic as a whole


Parties arguments32 l.jpg

Honduras the DSU

these contentions were simply arguments in support of its claim that the bond requirement violated Article III:4 of the GATT 1994

the Panel erred in treating its contentions regarding the timing of payment of the Selective Consumption Tax as a separate claim outside of the Panel's terms of reference

Dominican

the issue of the timing of payment of the Selective Consumption Tax is not dealt with in the legislative provisions identified by Honduras in connection with its claims against the bond requirement

Parties’ arguments


Ab s statement i l.jpg

Art.6.2 of the DSU the DSU

The request for the establishment of a panel shall be made in writing. It shall indicate whether consultations were held, identify the specific measures at issue and provide a brief summary of the legal basis of the complaint sufficient to present the problem clearly

US – Carbon Steel

... two distinct requirements, namely identification of  the specific measures at issue,  and the provision of a  brief summary of the legal basis of the complaint  (or the  claims). Together, they comprise the "matter referred to the DSB", which forms the basis for a panel's terms of reference under Article 7.1 of the DSU

AB’s statement I


Ab s statement ii l.jpg
AB the DSU ’s statement II

  • Nothing prevented Honduras from raising such arguments before the Panel, even though these arguments were not set out in the panel request

  • Honduras' contentions represent an assertion that the timing of payment of the Selective Consumption Tax resulted in a violation of Article III:4 of the GATT 1994 in itself, these contentions comprised a separate  claim  that was not included in the panel request

  • we note that there is no obligation upon a panel to consider each and every argument put forward by the parties in support of their respective cases

  • because such a challenge was not included in the panel request, we see no error in the Panel's finding that such a matter was outside its terms of reference


Conclusions i l.jpg
Conclusions I the DSU

  • upholds  the Panel's finding, that the tax stamp requirement is not justified under Article XX(d) of the GATT 1994

  • the Panel made an objective assessment of the facts of the case, as required by Article 11 of the DSU, in its examination of Exhibits DR-8 and DR-29

  • upholds  the Panel's finding that Honduras failed to establish that the bond requirement accords less favourable treatment to imported cigarettes than that accorded to like domestic products, in a manner inconsistent with Article III:4 of the GATT 1994


Conclusions ii l.jpg
Conclusions II the DSU

  • finds  that the Panel made an objective assessment of the matter before it, as required by Article 11 of the DSU, in its consideration of Honduras' claim against the bond requirement "as such"

  • finds no error  in the Panel's treatment of Honduras' contentions regarding the timing of payment of the Selective Consumption Tax


Result l.jpg
Result the DSU

  • AB recommends  that the Dispute Settlement Body request the Dominican Republic to bring the tax stamp requirement, found in this Report and in the Panel Report as modified by this Report to be inconsistent with the GATT 1994, into conformity with its obligations under that Agreement if, and to the extent that, the said modifications to the tax stamp regime have not already done so

  • AB also  recommends  that the Dispute Settlement Body request the Dominican Republic to bring its other measures, found in the Panel Report as modified by this Report, to be inconsistent with the GATT 1994, into conformity with its obligations under that Agreement


ad