CYIL vol. 8 (2017)

CYIL 8 ȍ2017Ȏ TO PERU – ADDITIONAL DUTY … be considered as a justification of the discriminatory nature of the Brazilian import ban of retreaded tyres. At first glance, it could seem that the WTO judiciary bluntly asserted its supreme and exclusive jurisdiction in case of any conflict with RTA dispute settlement mechanisms. However, the Appellate Body took care to point out that it would have been possible to coordinate the two systems of dispute resolution, arriving at decisions likely to be similar, had the Latin American country invoked Article 50(d) of the Treaty of Montevideo to justify the original general import ban toward the MERCOSUR contracting parties. Article 50(d) of MERCOSUR, in fact, “serves a function similar to that of Article XX(b) of the GATT 1994,” 50 having also a similar wording, as it states that “[n]o provision under the present Treaty shall be interpreted as precluding the adoption and observance of measures regarding: … d. [p] rotection of human, animal and plant life and health.” 51 Therefore, considered the WTO Appellate Members, “Article 50(d) of the Treaty of Montevideo, as well as the fact that Brazil might have raised this defense in the MERCOSUR arbitral proceedings … show, in our view, that the discrimination associated with the MERCOSUR exemption does not necessarily result from a conflict between provisions under MERCOSUR and the GATT 1994.” 52 7. The centrality of WTO exceptions’ rules for assessing the legitimacy of RTAs under the multilateral trade system and the importance of clarity when drafting RTAs in the Peru – Additional Duty case In this very recent dispute, Guatemala attacked the additional duties resulting from the operation of the Peruvian Price Range System (PRS), a mechanism set up in order to guarantee internal price stability for 45 agricultural products separated into four general categories -namely milk, yellow maize, rice, and sugar- and thus reduce, within the Peruvian market, fluctuations due to changes on worldwide prices. 53 The main purpose of the described discipline -hereinafter indicated as “the challenged measure”- is in particular to improve domestic competitiveness, protecting producers’ and importers’ interests: both the working categories, in fact, being in the condition to rely on a stable price, know in advance how much they would gain and how much they would have to pay for the sensitive agricultural products, “allowing [such] economic agents to operate efficiently and productively.” 54 Furthermore, the consequent stability in food prices represents an important element for a developing country like Peru, as food is a major share in poor people’s expenditure, and therefore fluctuations on food prices have major effects on their incomes. The PRS is based on a reference price for the affected products, reflecting the average international price over the preceding two weeks, along with a range composed by a floor price and a ceiling price, calculated on the international price over the last 60 months. Therefore, the attacked Peruvian measure imposes an additional duty on the transaction value of imports when the reference price is below the floor-price level, and 50 Appellate Body Report, Brazil – Retreaded Tyres , para. 234. 51 The text of the MERCOSUR provision is reported in Appellate Body Report, Brazil – Retreaded Tyres , footnote 443. 52 Appellate Body Report, Brazil – Retreaded Tyres , para. 234. 53 See the Supreme Decree No. 115-2001-EF, published in the Official Journal “El Peruano” on 22 June 2001. 54 Cfr. the wording of the Peruvian Supreme Decree No. 115-2001-EF reported in Panel Report, Peru – Additional Duties on Imports of Certain Agricultural Products , WTO Doc. WT/DS457/R (adopted on 31 July 2015), para. 7.118. FROM TURKEY – TEXTILES

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