Home > ANNEX A
WT/DS286/R
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WT/DS286/R
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ANNEX
A
EXECUTIVE SUMMARY BY THAILAND
AFTER THE
FIRST SUBSTANTIVE MEETING
(21 October
2004)
1. The basic
legal issue in this case is that, as a result of the EC's classification
of frozen salted chicken cuts with a salt content of 1.2% by weight
or more in a manner inconsistent with the correct interpretation of
headings 0210 and 0207 in the EC's Schedule of Concessions, the EC provides
to Thai exports of frozen salted chicken cuts treatment less favourable
than that accorded to that product in the EC's Schedule of Concessions.
The EC's measure is therefore inconsistent with the basic obligations
set out in Article II:1(a) and Article II:1(b) of the GATT.
2. Tariff concessions
are the cornerstone of the multilateral trading system. Article II of
the GATT requires WTO Members to limit their ordinary customs duties
or tariffs on a particular good as described in its Schedule of Concessions
up to the maximum level specified therein. As recognised by the
Appellate Body, "[a] basic object and purpose of GATT 1994 as reflected
in Article II, is to preserve the value of tariff concessions negotiated
by a Member with its trading partners, and bound in that Member's
Schedule." (Emphasis added)1
3. Thus, a Member's
obligation under Article II is to provide on products from other Members
tariff treatment "no less favourable" than that described
and bound on that product in its Schedule. A tariff concession
is comprised of at least four essential elements: (i) the numerical
heading, (ii) the description of the product, (ii) the maximum bound
tariff level and, (iv) the method of valuation of the good for customs
purposes. A Member's tariff concession would be rendered meaningless
if that Member were able to alter unilaterally any of those elements
in such a manner as to provide "less favourable treatment"
to the products of other Members.
4. Thailand
submits that the terms of the EC's concession cover chicken cuts deeply
and homogenously impregnated in all parts with a total salt content
of 1.2% or more by weight. The EC argues that this chicken meat
is "salted" within the meaning of its tariff concession
only if the salt was added for the purpose of long-term preservation.
The EC argues that if long-term preservation is achieved through freezing,
the Thai chicken meat can no longer be deemed to be "salted"
and should not benefit from the EC's concession.
5. The basic
interpretative issue is whether the term "salted" describes
the physical characteristics of the products benefiting from the
tariff concession - as claimed by Thailand - or whether that term
refers to the objective or purpose for which the product has been
salted – as argued by the EC. The EC's argument is entirely
novel and would mean that in order to determine the customs classification
of a product, it would no longer be sufficient to examine the physical
characteristics of the product. Instead, it would also be necessary
to examine for what purpose the product was given its physical
characteristics. The EC's novel approach is not supported by the
term "salted", is completely foreign to the Harmonised System,
deviates from the normal practice of customs classification of Members
and would, if introduced into WTO law, create great uncertainty in the
determination of the scope of the tariff concessions.
6. There are also important practical reasons why classification must depend on the physical characteristics of the product: a customs officer clearing products upon import would not be in the best position to determine whether the characteristics of the product presented achieve a certain purpose or objective. The EC's first written submission to the Panel, citing judgments of the European Court of Justice, recognises this basic principle, stating that it is the "objective characteristics and properties" of products at the time of customs clearance that is the "decisive criterion" for the purposes of customs classification.2
7. During the
Uruguay Round, the EC bound the products that fit the description of
frozen boneless poultry cuts under subheading 0207.41.10 at the rate
of 1024 ECU/T and designated those products as subject to the special
safeguard provisions of Article 5 of the Agreement on Agriculture.
The EC also bound the products that fit the description of salted meat
under subheading 0210.90.20 at the ad valorem rate of 15.4%, but
did not designate those products as being subject to the special safeguard
provisions. In 1994, when the EC finalised its Schedule of Concessions,
the prevailing view of the EC as defined in its own domestic Customs
classification law ("Combined Nomenclature" or "CN")
was that the product "salted meat" was meat that had been
"deeply and homogeneously impregnated in all parts with a minimum
salt content of 1.2%."3 Therefore, Thailand's understanding
was that the product that the EC had bound in its Schedule LXXX as salted
meat of heading 0210.90.20 was consequently the product which met the
EC's own definition of salted meat as stated in its own laws at that
time.
8. In 1996,
Thailand started exporting salted chicken to the EC in response to requests
from European food processors for salted chicken meat that could be
used directly in the manufacture of processed chicken products.
These chicken products were deeply and homogenously impregnated with
a minimum salt content of 1.2%. Due to the geographic distance between
Thailand and the EC and the fact that the duration of transportation
by ship takes between 21-28 days, Thai salted chicken exports by ship
also have to be frozen. Even though the Thai salted chicken exports
had always been frozen, the EC did not classify these products as frozen
chicken. The EC considered it sufficient that the Thai exports
met the EC's own definition of salted meat as set out in its Combined
Nomenclature and, consequently, the EC's Schedule LXXX. As a result,
from 1996 to mid-2002, Thai frozen salted boneless chicken cuts were
classified by the EC as 'salted meat' under heading 0210.90.20 at the
ad valorem tariff rate of 15.4%.
9. In November
2001, a Member of the European Parliament drew the attention of EC Agriculture
Commissioner Fischler to an increase in EC imports of salted chicken
and asked whether the EC could "unilaterally change the import
duty on salted chicken fillet by raising the stipulated salt content
of 1.2%".4
10. Commissioner
Fischler replied that:
[T]he Commission follows with great interest the evolution of imports on the market for all types of meat … The Honourable Member assumes that the meat in question is lightly salted and the salt may be shaken off. This fact would not be inconformity with the definition in the Combined Nomenclature which reads: 'For the purposes of heading 0210, the terms "meat and edible meat offal, salted, in brine, mean meat and edible meat offal, deeply and homogeneously impregnated in all parts having a total salt content of not less than 1.2% by weight." The Commission is however not aware that imported salted poultry meat does not comply with this definition. The Commission has drawn the attention of Member States to monitor closely the compliance of these poultry meat imports with the relevant Community provisions in customs or veterinary legislation. Furthermore, the options to deal with any problems that may arise regarding the products in question are being examined at present by the various departments of the Commission. (Emphasis added.)5
11. In response
to protectionist concerns, however, the EC adopted Regulation 1223/2002,
which alters the description of the product by classifying "boneless
chicken cuts, frozen and impregnated with salt in all parts with a salt
content of 1.2 to 1.9%" under the subheading of 0207.14.10.
As a result, chicken that previously met the definition of "salted
meat" by virtue of its minimum salt content of 1.2% in all parts
is now classified as "frozen chicken." Prior to Regulation
1223/2002, when the same chicken product was classified as salted meat,
it was accorded tariff treatment at an ad valorem rate of 15.4%.
Following Regulation 1223/2002, this same product - now classified as
frozen chicken – is accorded the bound tariff rate of 102.4€/100
kg/net.6 Based on 2003 chicken prices,
the specific tariff rate is equivalent to an ad valorem
rate of 58.9% -- much higher than the 15.4% ad valorem rate.
On the basis of the average annual price of salted chicken exported
from Thailand to the EC from 1997 to 2002, the equivalent ad valorem
rate was 43.9%. This tariff rate is much higher than the bound
rate of 15.4% that the EC committed to in its Schedule of Concessions
for salted meat.
12. Nothing in the WTO Agreement allows a WTO Member to address an anomalous influx of imports by changing the description of a product so that it falls under a different tariff heading with a higher tariff level. Nevertheless, it is clear from exchanges in the European Parliament and other fora that this was precisely the EC's goal in its classification of Thai chicken. In this case, by modifying the description of frozen salted chicken, so that it is now classified as frozen chicken rather than salted meat, the EC has raised the tariff rate on that product from 15.4% to the ad valorem equivalent of 58.9% (based on the price of chicken in June 2003)7 and effectively rendered its tariff concession on salted meat meaningless.
13. The applicable
EC customs regime at the time of the conclusion of the Uruguay Round
was set out in the Combined Nomenclature published in Annex I to Council
Regulation 2658/87 on the tariff and statistical nomenclature and on
the common customs tariff. Article 12 of Regulation 2658/87 provides
that the Commission shall adopt each year no later than 31 October,
by means of a Regulation, a complete version of the Combined Nomenclature
together with the corresponding autonomous and conventional rates of
duty. The most important element of the annual update is the amendment
to Annex I to Regulation 2658/87, which contains the complete Combined
Nomenclature.
14. The structure
of the Combined Nomenclature was based on that of the Harmonized System.
Prior to the conclusion of the Uruguay Round, the Combined Nomenclature
was amended by Regulation 535/94 which inserted the following additional
note to Chapter 2 of the CN (originally additional note 8, renumbered
in 1995 as additional note 7):
For the purposes of heading 0210, the term "salted" means meat or edible meat offal which has been deeply and homogeneously impregnated with salt in all parts, having a total salt content not less than 1.2% by weight.
15. Regulation
535/94 provides that "… to ensure uniform application of the
CN, provisions should be laid down for the classification of salted
meat and edible meat offal falling within CN code heading 0210,
in order to distinguish them from fresh, chilled or frozen meat and
edible meat offal; whereas a total salt content of 1.2% or more by weight
appears to be an appropriate criterion for distinguishing between these
two types of products" (emphasis added). At this point,
therefore, the EC considered that a product with a salt content of 1.2%
satisfied the criterion to be met for a product to be classified as
salted meat under heading 0210 and served to distinguish that product
from products that were fresh, chilled or frozen.
16. The verification process of tariff schedules among all Uruguay Round negotiating parties took place from 15 February to 25 March 1994.9 It was during this period of verification of tariff schedules, that, by way of Regulation 535/94, the EC clarified the scope of its tariff concession under heading 0210, in particular, with respect to the term "salted." This additional note was published in Regulation 535/94 on 11 March 1994 and remained valid in the EC Combined Nomenclature until 13 November 2003.10
17. The definition
of "salted" as set out in Regulation 535/94 was incorporated
into Regulation 2658/87 through Regulation 3115/94.11
The Preamble of Regulation 3115/94 states the need to:
… amend the combined nomenclature to take account of:
- changes in requirements relating to statistics or commercial policy, in particular by virtue of Council Decision bringing into force simultaneously the acts implementing the results of the Uruguay Round of multilateral trade negotiations and Council Regulation concerning certain measures resulting from the conclusion of negotiations under Article XXIV:6 and other measures necessary for simplification purposes,
- the need to align or clarify texts; (emphasis added.)
18. Regulation 3115/94 was enacted in order to meet the requirements of Article 12 of Regulation 2658/87 which provides for the Commission to adopt each year a complete version of the Combined Nomenclature.
19. Regulation
1223/2002, concerning the classification of certain goods, states that
its adoption is necessary to ensure the uniform application of the Combined
Nomenclature pursuant to the general rules for the interpretation of
the Combined Nomenclature laid down in Regulation 2658/87.13
20. Article
1 of Regulation 1223/2002 sets forth that goods described in column
1 of the table set out in the Annex to the Regulation should be classified
under the CN code indicated in column 2, by virtue of the reasons set
out in column 3. The Annex to Regulation 1223/2002 is reproduced
below:
Description of Goods | CN Code | Reasons |
(1) | (2) | (3) |
Boneless
chicken cuts, frozen and impregnated with salt in all parts. They have
a salt content by weight of 1.2 to 1.9%. The product is deep-frozen and has to be stored at a temperature of lower than - 18�C to ensure a shelf-life of at least one year. |
0207 14 10 | Classification
is determined by the provisions of the General Rules 1 and 6 for the
interpretation of the Combined Nomenclature and by the wording of CN
codes 0207, 0207 14 and 0207 14 10. The product is chicken meat frozen for long-term conservation. The addition of salt does not alter the character of the product as frozen meat of heading 0207. |
21. Article 2 of Regulation 1223/2002 further established that binding tariff information (BTI) issued by customs authorities of EC Member States, which was not in accordance with the provisions of the Regulation, could continue to be invoked for a period of three months. Regulation 1223/2002 entered into force on 29 July 2002 and is binding in its entirety and directly applicable in all EC Member States.14
22. On 12 February
2003, the Commission of the EC adopted Commission Decision of 31 January
2003 ("Decision") concerning the validity of certain BTIs
issued by Germany. The Decision noted that Regulation 1223/2002
was adopted to clarify and confirm the classification of the products
described as frozen poultrymeat of heading 0207, under CN subheading
0207.14.10 "[b]oneless chicken cuts, frozen and impregnated with
salt in all parts. They have a salt content by weight of 1.2 to 1.9%.
The product is deep-frozen and has to be stored at a temperature of
lower than -18� to ensure conservation for at least one year."
23. According to the Decision, following the publication of Regulation 1223/2002, all BTIs previously issued by Member States classifying the products concerned as salted meat of heading 0210 ceased to be valid. Pursuant to Regulation 1223/2002, some Member States later issued BTIs for frozen chicken cuts containing 2 to 2.7% of salt, under heading 0207. Nevertheless, there were a number of cases in which Germany was issuing BTIs classifying frozen boneless chicken cuts containing between 1.9 and 3% by weight of salt, under heading 0210.
24. On 25 October
2003, the EC published Commission Regulation (EC) No.1871/2003 of 23 October
2003, amending Annex I to Council Regulation (EEC) 2658/87.16
Recital 3 of Regulation 1871/2003 maintains that classification in Chapter
2 of the Combined Nomenclature depends essentially on the process employed
to ensure the long-term preservation of a given product. Recital 4
states that, according to the Harmonized System explanatory notes to
Chapter 2, "fresh meat remains classified as fresh meat if it has
been packed with salt as a temporary preserving agent during transport
and that this reasoning equally applies to frozen meat."
Recital 4 adds that for the purposes of heading 0210 (which comprises
the EC's concession under heading 0210.90.20), salting must be sufficient
to ensure long-term preservation for purposes other than transportation.
25. Recitals
5 and 6 reiterate that salting, within the meaning of heading 0210,
is a process used to ensure long-term preservation and noted that additional
note 7 to Chapter 2 of the CN should be amended accordingly. Therefore,
Article 1 of Regulation 1871/2003 provides that the additional note 7
to Chapter 2 of the Combined Nomenclature is replaced by the following:
For the purposes of heading 0210, the terms ‘meat and edible meat offal, salted, in brine' mean meat and edible meat offal deeply and homogeneously impregnated with salt in all parts and having a total salt content of not less than 1.2% by weight, provided it is the salting which ensures long-term preservation.
26. In light of these changes, the EC adopted Article 1 of Regulation 2344/2003, which, amends Annex I to Regulation 2658/87, including the amendment made by Regulation 1789/2003. Regulation 2344/2003 came in to force on 1 January 2004 and is binding in its entirety and directly applicable in all EC Member States.
27. Thailand began exporting salted chicken to the EC in 1996 in response to specific requirements of importers. Salted chicken is not sold to the average consumer. Rather, it is sold to the food processing industry. The salted chicken is used in the manufacturing of processed chicken products, such as chicken nuggets. For this end-use, salted chicken helps the manufacturers reduce preparation time and costs. The salt serves to reduce moisture loss during the cooking process, and results in meat with better processing properties.
28. The EC's
Schedule LXXX is an annex to the GATT and must be interpreted in accordance
with the Vienna Convention on the Law of Treaties. As the Appellate
Body confirmed in EC – Customs Classification of Certain Computer
Equipment:
A Schedule is made an integral part of the GATT 1994 by virtue of Article II:7 of the GATT 1994. Therefore, the concessions provided for in that Schedule are part of the terms of the treaty. As such, the only rules which may be applied in interpreting the meaning of a concession are the general rules of treaty interpretation set out in the Vienna Convention.17
29. Applying
Articles 31 and 32 of the Vienna Convention, Thailand submits that the
scope of the EC's concessions under 0210 includes the Thai chicken product
at issue here.
30. The
ordinary meaning of the terms of Schedule LXXX provides a clear description
of the products falling under headings 0210 and 0207, respectively.
Heading 0210 covers "meat and edible meat offal, salted, in brine,
dried or smoked; edible flours and meals of meat or meat offal."
The ordinary meaning of "meat" includes poultry. The ordinary
meaning of "salted" is "impregnated with, containing
or tasting of salt."18 The term "salted "is
followed by the terms "in brine, dried, or smoked."
The definitions of these terms are the following:
31. The common
element in these terms and in the term "salted" denotes an
additional process to the natural state of the meat. That process
could be either salting the meat, putting it in brine, drying it or
smoking it. In other words, the common element is that the product
undergoes a process that changes its natural condition by preparing
it.
32. In contrast, heading 0207 covers "meat and edible meat offal of the poultry of heading 0105, fresh, chilled or frozen." The heading 0105 covers "live poultry, that is to say, fowls of the species Gallus domesticus, ducks, geese, turkey and guinea fowls." Domestic chicken is a fowl of the species Gallus domesticus.
33. The ordinary
meaning of "fresh" refers to food "…not preserved by
salting, tinning, freezing, etc."22, "recently made, produced or
harvested; not stale or spoiled" and "not preserved, as by
canning or freezing."23 The ordinary meaning of "chilled"
is to "preserve by cooling."24 The ordinary meaning of frozen
is to "…preserve (food) by refrigeration below freezing point"25
or "to preserve (food for example) by subjecting to freezing temperatures".26
34. Based on
the ordinary meaning of these three terms, heading 0207 covers poultry
meat that is either fresh, chilled or frozen, which are the various
stages in which the poultry meat may be maintained so that it is in
its original natural state or may be easily returned to its original
state. As noted, "[f]reezing is one of the easiest and least
time-consuming methods of food preservation. Most foods retain their
natural color, flavour, texture better than when other methods of food
preservation are used" (such as canning).27
There is no indication from the ordinary meaning of the terms in the
headings that the state of freshness or the state of preservation by
cooling is a more important criterion to determine classification than
the state of preparation. Furthermore, even assuming preservation
were the relevant criterion, there is certainly no reference to long-term
preservation or conservation as being the decisive factor to determine
the eventual classification of the product.
35. The term
"frozen" refers to the preservation of the product by cooling
or refrigeration. The verb "preserve" means "to
maintain (a thing) in its existing condition"28
or "to prevent (organic bodies) from decaying or spoiling."29
In the light of these definitions, a "frozen" product that
can be maintained in or returned to its original state without any change
in its physical or chemical characteristics. If a product is frozen,
it can easily be thawed in order to return the product to its original
state.
36. In contrast
to freezing, the salting of a product entails a process which alters
the original state of the product. Meat of heading 0210 is "meat
… salted, in brine, dried, smoked." Chicken that has been
subject to one of these preparation processes: salt impregnation, salt-water
immersion, removal of moisture or darkening caused by smoke falls under
0210.
37. Moreover,
the processes listed in heading 0207 can be clearly distinguished from
those in heading 0210. A process is defined in the New Shorter
Oxford English Dictionary as, inter alia, "[a] thing
that goes on or is carried on; a continuous series of actions, events
or changes; a course of action, a procedure; esp. a continuous
and regular action or succession of actions occurring or performed in
a definite manner; a systematic series of actions or operations directed
to some end, as in manufacturing, printing, photography, etc."
Heading 0207 covers products that are "fresh, chilled, or frozen."
If a product is fresh it cannot be said to have undergone a process.
Chilling and freezing may be considered as processes. Of the three
states (fresh, chilled or frozen) listed in the note to heading 0207,
chilling and freezing relate to a process to ensure the purpose of preservation.
However, all of the processes in heading 0207 relate to the temperature
of the product. The note to heading 0207 states:
This heading covers only fresh, chilled or frozen meat and edible offal of domestic poultry which, when live are classified in heading 01.05.
38. In contrast,
the processes in heading 0210 relate to the preparation of the product
rather than its temperature. The note to heading 0210 states:
This heading note applies to all kinds of meat and edible meat offal which have been prepared as described in the heading, other than pig fat, free of lean meat, and poultry fat, not rendered or otherwise extracted (heading 02.09). The heading includes streaky pork and similar meats interlarded with a high proportion of fat, and fat with an adhering layer of meat, provided they have been prepared as described in the heading. (Emphasis added).
39. Chicken
is salted by placing the meat in a drum-shaped container to which the
salt is added. The container with the meat is slightly shaken
("tumbled") until the salt is dissolved. The meat is
then left in the solution for a specified period of time. This process
causes the meat to be salted to the very core of the product. Once the
meat is salted in this manner, it cannot be completely washed off or
otherwise thoroughly de-salted. The salt has two main effects
on poultry: "[i]t dissolves protein in muscle, and the salt and
protein reduce moisture loss in cooking. This makes the meat juicier,
more tender and improves the flavour. The low levels of salt enhance
the other natural levels of poultry."30 High levels of salt are known
to increase the water-binding properties of a meat product.31
Thus, a frozen boneless chicken cut, once thawed and cooked, will taste
the same as a fresh boneless chicken cut once cooked. However,
a chicken cut that is salted, put in brine, dried or smoked would taste
quite different once cooked after having undergone such a process.
40. Following
the advent of refrigeration, there are more modern ways of preserving
food than the use of salt. Therefore, today, salt is used primarily
to flavour or to prepare food. Indeed, the EC has acknowledged
that that "the exclusive use of salting of meat products for preservation
is now relatively rare,"32 and that "[p]roducts preserved
by salting (or a combination of salting, drying and smoking) remain
popular today primarily by virtue of their taste and other characteristics,
regardless of the fact that they are preserved by methods which have
been surpassed (at least technologically) by freezing" (emphasis
added).33 Thailand agrees with these EC
statements.
41. Thailand
emphasises that this dispute concerns tariff treatment under Article
II of the GATT, therefore, requires an examination of the EC's concession
in heading 0210 and an assessment of whether the product at issue has
the physical characteristics of the product described in the EC's Schedule
of Concessions. While the production processes that impart these
characteristics and the end-uses of the product might be relevant to
a determination of the likeness of products under GATT Article III,
they are not relevant to the issue in this dispute.
42. Once a product
is salted, it cannot be completely unsalted by immersion in water.
The essential character of the chicken product is changed as a result
of the salting. This also limits its end-uses. The salted chicken
exported by Thailand to the EC is sold to the food processing industry
in the EC and is intended for use in the manufacture of value-added
chicken products. The importers in the EC market regard salted
and unsalted chicken as completely different products.
43. The EC has
stated that "[t]he addition of salt does not alter the character
of the product as frozen meat under 0207." If this rationale
were to be adopted by other countries, it would mean that a product
such as Danish slab bacon which is smoked and cured but nevertheless
frozen for export purposes would have to be classified as frozen rather
than smoked. Thailand has also submitted evidence that other salted
meat products, such as Parma ham, prosciutto and jam�n serrano must
be conserved at a temperature below that of ambient temperature, namely
at a chilled level. In other words, these products may be salted
and dried but they are also chilled.
44. Moreover,
the ordinary meaning of the term "salted" does not imply that
the product must be salted for the purpose of preservation. Despite
the fact that this purpose is not found in the ordinary meaning of "salted"
and that the EC's own definition of salted for the purpose of heading
0210 (as stated in Regulation 535/94) did not refer to preservation,
or long-term preservation, the EC nevertheless introduced in Regulation
1871/2003 the requirement that salting, of heading 0210, "…is
a process used to ensure long-term preservation." The introduction
of such a requirement is baseless and without any textual support in
heading 0210.
45. The EC must
be presumed to have been aware of the percentage of salt required to
preserve a product for the purpose of long-term preservation.
In its first definition of the terms "salted, in brine" under
heading 0210 in Regulation 535/94, the EC established stipulated a minimum
salt content of 1.2% deeply and homogeneously impregnated in all parts.
At this low level, the product cannot be preserved by salting alone,
as the Preamble in Regulation 535/94 acknowledges in stating that
"provisions should be laid down for the classification of salted
meat and edible meat offal falling within CN code heading 0210,
in order to distinguish them from fresh, chilled or frozen meat and
edible meat offal; whereas a total salt content of 1.2% or more by weight
appears to be an appropriate criterion for distinguishing between these
two types of products."
If it were necessary to establish a minimum level of salt to classify
a product as salted rather than frozen, it is clear that the EC assumed
that such a product would enter the EC either in a salted and fresh
state, or in a salted and chilled state, or in a salted and frozen state.
Otherwise, there would be no need to distinguish these products from
each other.
46. The Appellate
Body has stated that one of the corollaries of the "general rule
of interpretation" in Article 31 is that "interpretation [of
a treaty] must give meaning and effect to all the terms of a treaty."
An interpreter may not adopt a reading that would result in reducing
whole clauses or paragraphs of a treaty to redundancy or inutility.34
The EC's interpretation of requiring "salting" to be carried
out for the purpose of long-term preservation reduces the ordinary meaning
of the term "salted" in heading 0210 and the EC's tariff concessions
under that heading (when a product is both frozen and salted) to inutility.
47. Moreover,
the EC has failed to demonstrate that WTO Members agreed that only meat
salted for the purpose of long-term preservation would fall within the
definition of "salted." The Appellate Body has said
that the "[t]he duty of a treaty interpreter is to examine the
words of the treaty to determine the intentions of the parties … [p]rinciples
of interpretation neither require nor condone the imputation into a
treaty of words that are not there or the importation into a treaty
of concepts that were not intended".35 There is no basis to impute
the concept of preservation into the definition of "salted."
48. In addition, the EC itself acknowledges that the ordinary meaning of "salted" in heading 0210 can either refer to meat that has been "preserved by salt" or to meat for which "it's (sic) flavour has been altered by the addition of salt".36 There may be purposes for salting other than those cited by the EC. However, the only common denominator between these meanings is that salt must be included in the product. As acknowledged by the EC, the ordinary meaning of "salted" does not resolve the question of which meaning should be preferred37 and the choice of which of the two possible meanings it cites for "salted" in heading 0210 must be resolved through an analysis of the "context."
49. The context
of the headings in the EC's schedule of concessions also supports Thailand's
arguments. Heading 0210.90 of the EC's Schedule of Concessions
covers all salted meat other than "meat of swine" and "meat
of bovine animals." In turn, the subheading 0210.90.20 covers
salted meat other than "meat of swine" and "meat of bovine
animals" and "horsemeat, salted in brine" and meat "of
sheep and goats" as there are specific sub headings for such meat.
"Salted meat" of chicken is not excluded from the terms of
heading 0210.90.20 under this contextual analysis. Applying the
principle expressio unius est exclusio alterius, this heading
must be construed as including other types of meats not expressly excluded
(e.g., chicken). Therefore, this context confirms that the ordinary
meaning of "salted meat" covers chicken.
50. Second,
the structure of the headings at the 4-digit level indicates that the
first 8 headings refer to different types of meat and offal that are
fresh, chilled or frozen. There is one heading, namely that of
0209, pig fat, which covers not only fresh, chilled or frozen, but also
salted, in brine, dried or smoked. The last heading covers meat
and edible meat offal, salted, in brine, dried or smoked. Therefore,
the products are either classified as fresh, chilled or frozen (the
first 8 headings) or as salted, in brine, etc (heading 0210); only heading
0209, specifically lists all the various states. However, the
heading 0210 does not list all the states. It only lists the states
of salted, in brine, dried or smoked. This indicates that, for
heading 0210, the type of preparation is the determining factor for
the classification of that product.
51. The EC alleges that an interpretation of the term "salted" in its context must mean exclusively that meat is salted for the purpose of long-term preservation.38 The context the EC examines is the surrounding terms in heading 0210 of "in brine", "dried", and "smoked". From these three terms, the EC attempts to infer that the common denominator is that of preservation. However, these terms also go to the preparation of the product. An examination of the context of the other tariff headings, such as headings 0812 and 0814 in the EC's Schedule LXXX shows that when preservation is the relevant criterion, it is expressly stated. Thus, when the EC considers that a product must be classified on the basis of its preservation characteristics, that objective characteristic of preservation is specifically listed in the tariff heading itself. Heading 0210, in contrast, makes no reference at all to a preservation requirement.
52. The Appellate Body has stated that the object and purpose of the Article II of the GATT, is to preserve the value of tariff concessions negotiated by a Member with its trading partners, and bound in that Member's Schedule. It is therefore essential that the description of the products falling under a particular subheading be maintained as they were established at the time of the negotiation of the concession. Accordingly, not only the numerical headings and the tariffs levels, but also the description of the products which give that tariff binding its complete scope and content must be respected in order to preserve the value of a concession.. A Member is not permitted, as the EC has done here, to undermine its concessions in its Schedule by changing the description of products falling under a particular heading.
53. In EC
– Computer Equipment, the Appellate Body made clear that a proper
interpretation of Schedule LXXX must include a consideration of the
Harmonized System and its Explanatory Notes. The EC's customs
classification law, as set out in its Combined Nomenclature39
is based on the Harmonized System. In the present case, therefore,
the Panel should examine the Harmonized System and its Explanatory Notes
in order to conduct a proper examination of the terms of Schedule LXXX.
54. Article
1 of the Harmonized System Convention defines the Harmonized System
as comprising, inter alia, the General Rules for the Interpretation
of the Harmonised System. Article 3.1(a) obliges Contracting Parties
to ensure that its "Customs tariff and statistical nomenclatures
shall be in conformity with the Harmonised System." Thus,
if the Panel were to consider the Harmonized System, it would need to
rely upon the General Rules for the Interpretation of the Harmonized
System because they are an integral part of the Harmonized System.
55. In addition,
the EC and Thailand as Contracting Parties to the Harmonized System
Convention have accepted, inter alia, the following obligations
under Article 3 of the Harmonized System Convention:
(i) [they] shall use all the headings and subheadings of the Harmonized System without addition or modification, together with their related numerical codes;
(ii) [they] shall apply the General Rules for the interpretation of the Harmonized System and all the Section, Chapter and Subheading Notes, and shall not modify the scope of the Sections, Chapters, headings or subheadings of the Harmonized System … (emphasis added)
56. The EC has
also agreed to apply the General Rules for the Interpretation of the
Harmonized System40, including, in particular, General
Rule of Interpretation l, which provides that:
The titles of Sections, Chapters and sub-Chapters are provided for ease of reference only: for legal purposes, classification shall be determined according to the terms of the headings and any relative Section or Chapter Notes and, provided such headings or Notes do not otherwise require, according to the following provisions: …
57. The classification of products under HS 0207 and 0210 must be examined according to the terms of the headings.41 The terms in the headings 0207 and 0210 in Schedule LXXX and the Harmonized System are identical. Under HS heading 0210, the term "salted" is not qualified in any way. In particular, there is no quantitative specification in the heading as to the threshold level of salt that must be met to classify the product as salted.
58. The Section
Note to Section 1 covering "Live Animals, Animal Products"
(the Section within which Chapter 2 falls) is not useful in the present
case for the proper classification of the product at issue.
59. The first item in the General Note to Chapter 2 provides that the Chapter covers meat and meat offal in the following states: (i) fresh; (ii) chilled; (iii) frozen; and (iv) salted, in brine, dried or smoked. The state of "fresh" may include meat and meat offal that is packed with salt as a temporary preservative. The fact that the salt in this case is used as "packing" means that the salt has not impregnated the product and may be easily washed off. Meat that has been temporarily packed with salt does not have its essential characteristics modified. This temporary packing with salt is completely different from the process of adding salt so that it is deeply and homogenously impregnated with salt in all parts.42 In Regulation 1871/2003, the EC extrapolates from the reasoning in the first item in the Chapter Note to the effect that if the addition of salt in fresh meat means that the meat must be classified as fresh, then the addition of salt in meat that is frozen means that the meat must be classified as frozen. However, this is inconsistent with the EC's own definition of "salted" in Regulation 535/94 meaning a product that is "deeply and homogenously impregnated with salt in all parts and having a total salt content of not less than 1.2% by weight." It is also inconsistent with the rationale in item 1 of the Chapter Note stating that fresh meat that has been packed with salt as a temporary preservative must be classified as fresh meat. Thai chicken exports are not 'packed' with salt as a temporary preservative. They are deeply and homogenously impregnated with salt in all parts at a minimum of 1.2% in order to prepare the product. Therefore, once the salt is added as more than a temporary preservative, it must be classified as something other than "fresh" or "frozen". It must be classified as "salted."
60. The note
to heading 0207 (which the EC claims the product at issue falls under)
provides, in part, that:
This heading covers only fresh, chilled or frozen meat and edible offal of domestic poultry which, when live, are classified in heading 01.05 (…) (Emphasis added.)
61. Chapter
2 covers the classification of meat in different states or which have
undergone different processes: fresh, chilled, frozen, salted, in brine,
dried or smoked. However, the note to heading 0207 makes clear
that it applies only to meat in three of them – i.e.,
fresh, chilled or frozen. In other words, heading 0207 clearly
excludes meat that is salted, in brine, dried or smoked.
62. Applying
the principle of treaty interpretation, expressio unius est
exclusio alterius, the note to heading 0207 expressly includes meat
that is fresh, chilled or frozen out of all the possible different
states of meat covered by Chapter 2. Therefore, heading 0207 expressly
excludes meat that is salted, in brine, dried or smoked. Thailand
submits that by adding meat that is salted to fall under the classification
of heading 0207, the EC is specifically modifying the scope of the
HS heading 0207. By modifying the scope of the HS heading,
it is consequently modifying the scope of heading 0207 in Schedule LXXX.
63. Heading
0207 specifically excludes meat that is salted, in brine, dried or smoked
because they have undergone a process of preparation. This interpretation
is supported by the note to heading 0210, which states that " "This
heading applies to all kinds of meat and edible meat offal which
have been prepared as described in the heading" (emphasis
added). Therefore, any meat that is prepared as described in the
heading must be classified under heading 0210.
64. There is
no textual justification in the Chapter or heading notes in the HS to
support the EC's position that the method of conservation or preservation
alone should determine proper classification of a product. The Chapter
and heading notes confirm the ordinary meaning of salted to mean a product
that contains salt, and not a product that is preserved by the method
of salting. Applying General Rule of Interpretation 1, which provides
that classification shall be determined according to the terms of the
headings and the relevant notes, salted chicken, which is frozen, must
be classified under only one heading 0210, specifically under subheading
0210.90 of the Harmonized System nomenclature.
65. Thailand
also emphasises that the HS does not characterise "preservation
and preparation" as "processes." Rather, they are
the purposes for which a particular process is undertaken.
For example, a product may be smoked by a particular process in order
to achieve the purpose of preparation. Thus, the Explanatory
Note t o Chapter 2 makes a reference to "prepared or preserved
by any process". The Chapter Note
to Chapter 16 makes a reference to "prepared or preserved by the
processes specified in Chapter 2 or 3 or heading 05.04." This
means that the purposes of preservation and preparation may be
achieved by the processes which are specified in Chapter 2, Chapter
3 and in heading 05.04.
66. Insofar as the purpose of the process is relevant to the scope of the EC's concession on 0210 in Schedule LXXX, the purpose of the processes in 0207 (chilling or freezing) would be that of preservation. The purpose of the processes to which products falling under heading 0210 are subject would be that of preparation. This is confirmed by the EC's own Additional Note 6 which states that: "products falling within heading No. 0210 to which seasoning has been added during the process of preparation remain classified therein, provided that the addition of seasoning has not changed the character of the product"(emphasis added). This Additional Note 6, which clearly refers to products in heading 0210 as having undergone a process for the purpose of preparation, has been included in the EC's Combined Nomenclature since at least 1992 until 2003. This definition is still in the 2003 version of the Combined Nomenclature.
67. General
Rule of Interpretation 3(a) states that the heading which provides the
most specific description of the product shall be preferred to headings
providing a more general description. In this case, salting, unlike
freezing, modifies the characteristics of a product. Salted chicken
has a different flavour and texture that cannot be removed and makes
it suitable for the manufacture of processed chicken products.
In contrast, frozen and unfrozen chicken are the same product and once
a product has been frozen it can be easily thawed to return to its original
state. The EC has acknowledged this in the context of an anti-dumping
investigation on imports of Salmon from Norway, Chile and the Faeroe
Islands, where it noted that "freezing of salmon was [not] sufficient
to alter the basic characteristics of the product" and that "[r]ather
than adding value to the product that was appreciated by certain users,
it was considered that one of the main reasons for freezing the product
was to facilitate its transport to the Community."43
68. In addition,
General Rule of Interpretation 3(b) is not applicable to an edible meat
product as it relates to "mixtures, composite goods consisting
of different materials or made up of different components."
Rule 3(c) provides that when the classification of goods cannot be resolved
by reference to Rule 3(a) or Rule 3(b) they shall be classified under
the heading which occurs last in numerical order among those that equally
merit consideration.
69. However, the minutes of the EC's Customs Code Committee state that the "… product corresponds at the same time to the wording of the heading 0207 (frozen) and to the wording of the heading 0210 (salted)." In its First Written Submission, Thailand indicated that it did not consider that Rule 3(c) is applicable in this case because the product at issue is only classifiable under heading 0210 as salted meat and not under the heading of 0207 for frozen chicken. Nonetheless, if the Panel were to consider that the product is prima facie classifiable under both 0207 and 0210, then the application of Rule 3(c) would be warranted. In that event, between the two headings that equally merit consideration in the view of the EC's Customs Code Committee, heading 0210 occurs last in numerical order. Therefore, the Panel could find on this basis alone that the product frozen salted chicken is classifiable under heading 0210.
70. The EC relies
on the Gausepohl case, in which Court of Justice held that for
meat of bovine animals to be classified under heading 0210, the product
had to be (i) deeply and evenly impregnated with salt in all its parts;
(ii) for the purposes of long-term preservation; and (iii) with
a minimum total salt content of 1,2% by weight. However, when
the EC codified the findings of the Gausepohl case in Additional
Note 8 through Regulation 535/94 (later renumbered as Additional Note
7), which was published prior to the conclusion
of the Uruguay Round, it retained the first and third of these criteria,
but specifically omitted the second criterion that the product had to
be for the purpose of long-term preservation. This was not just
an unintended omission; the EC deliberately decided to exclude the notion
of long-term preservation. Therefore, as of the time of the
conclusion of the treaty, the EC itself recognised that the "purpose
of long-term preservation" was not a relevant factor for determining
whether a product should be considered as salted, and therefore, classified,
under 0210. This confirms that the EC was of the view at that time that
products had to be classified on the basis of the objective physical
characteristics. This is presumably why the Commission "partly
altered its position in the course of the oral procedure by suggesting
a minimum salt content required for meat to be classified under heading
0210, namely 1.2% of the weight."44 The logic of the Gausepohl
case also contradicts the EC's claim that the purpose of preservation
was so self-evident that it saw no need to include specific reference
to this criterion in Regulation 535/94.
71. Moreover, EC documents submitted by Thailand directly contradict the EC's position. The Minutes of the EC's Customs Code Committee of 25 January 2002 expressly acknowledged that the element of long-term preservation was excluded from the final definition of "salted" meat for the purposes of classification under heading 0210 in Regulation 535/94 and subsequently in Additional Note 7.45
72. Under EC
law, Additional notes, such as "Additional note 7", become
part of the heading to which they refer. As explained by
the European Court of Justice,
[… an Additional Note] decided upon by the Council, becomes part of the heading to which it refers and has the same binding effect whether it constitutes an authentic interpretation of the heading or supplements it.46 (emphasis added).
73. The EC has
also specified quantitative levels that must be met for a product to
be considered as "dried or smoked." Additional Note
2(E) in Chapter 2 provides that:
For the purposes of subheadings 0210 11 31, 0210 11 39, 0210 12 19 and 0210 19 60 to 0210 19 89, products in which the water/protein ratio in the meat (nitrogen content x 6,25) is 2,8 or less shall be considered as 'dried or smoked.' The nitrogen content shall be determined according to ISO method 937-1978.
74. The structure of Additional Note 2(E) is the same as that of Additional Note 7, in that the classification of a product as "dried or smoked" or "salted" is dependent on a neutral and objective criterion – here, a specific water/protein ratio. In both instances, these criteria for determining whether a product would fall under heading 0210 could be easily assessed by a Customs Officer at the border. In addition, there is no requirement in Additional Note 2(E) that the product must be dried or smoked for the purposes of long-term preservation.
75. In EC
– Computer Equipment, the Appellate Body recognised that the classification
practices of the respondent "during the Uruguay Round negotiations
is 'part of the circumstances' of [the] conclusion of the WTO Agreement
and may be used as a supplementary means of interpretation within the
meaning of Article 32 of the Vienna Convention."47
The Appellate Body further noted that "…[i]f the classification
practice of the importing Member at the time of the tariff negotiations
is relevant in interpreting tariff concessions in a Member's Schedule,
surely that Member's legislation on customs classification at that time
is also relevant."48
76. Thus, the
latest relevant time that the meanings of the headings of EC's Schedule
LXXX should be assessed is 15 April 1994, namely the date on which the
Schedule was annexed to the Marrakech Protocol and the EC thereby assumed
its commitments under the Uruguay Round. As the Appellate Body
stated in United States – Import Prohibition of Certain Shrimp
and Shrimp Products, the key date for the interpretation of the
treaty at issue was 1994, which was the time at Members assumed their
obligations under the WTO Agreement. In particular, the Appellate Body
examined the term "exhaustible natural resources" in GATT
Article XX(g) in the light of the wording of the Preamble of the WTO
Agreement.49
77. The EC's customs classification legislation at the time of the conclusion of the Uruguay Round stated that for the purposes of heading 0210, the term "salted" means meat or edible meat offal which has been meat deeply and homogenously impregnated with salt in all parts with a total salt content not less than 1.2% by weight. The 1.2% threshold was specifically added to distinguish the classification of salted meat and edible meat offal falling within heading 0210 from fresh, chilled or frozen meat. The definition is silent as to the requirement that the product be salted for the purpose of long-term preservation.
78. In Argentina
– Textiles and Apparel, the Appellate Body made clear that the
"application of a type of duty different from the type provided
for in a Member's Schedule is inconsistent with Article II:1(b), first
sentence, of the GATT 1994, to the extent that it results in ordinary
customs duties being levied in excess of those provided for in that
Member's Schedule."50 (Emphasis added).
79. The change
from an ad valorem rate to a specific duty in this case is WTO-inconsistent
to the extent that it results in the application of duties over the
bound rates and where there was no ceiling provided to ensure that the
bound rate is not exceeded.
80. Thailand
has demonstrated that the specific rate of 102.4€/100 kg/net would
only be equivalent to the ad valorem rate of 15.4% if the price
for boneless chicken were 6.65 €/kg. Once the price of chicken
is lower than 6.65€/kg, then the specific tariff rate of 102.4 €/100kg/net
would exceed the ad valorem bound rate of 15.4% and would therefore,
result in "less favourable treatment" being provided.
81. Thailand
first began exporting chicken in 1996 to the EC. During the period between
1997 and mid-2002, the average price of chicken has been 2.3€/kg.51
Thus, the application of the specific duty of 102.4€/100 kg/net -
given the price of chicken in June 2003 and the average price of chicken
from 1997 to 2002, has always led - to the application of an ordinary
customs duty in excess of the bound rate of 15.4% ad valorem,
provided for in the EC's Schedule of Concessions. This is "treatment
less favourable" within the meaning of GATT Article II:1(a).
82. The EC measure is inconsistent with Article II:1(b) of the GATT because the consequence of the classification of chicken set out in Regulation 1223/2002 and the Decision of 31 January 2003 leads to the same product being subject to the application of duties higher than the EC's ad valorem bound rate of 15.4%. The EC is free to use whatever system of customs classification it wishes, as long as duties remain at or below the bound rates, for that product. Because the EC's classification of frozen boneless chicken cuts as provided in Regulation 1223/2002 and elaborated in the Decision of 31 January 2003 leads to the application of duties higher than the bound rate for frozen salted chicken, the EC is in violation of its Article II obligations.
83. The EC's basic argument in this case is that Thailand is exporting an "artificial product" that was "created only to avoid the tariff levels which the [EC] negotiated" during the Uruguay Round. The EC argues that it negotiated a low tariff for heading 0210 because it did not expect any trade in that product52 and that its purpose during the Uruguay Round was "to achieve a desirable level of protection for frozen chicken."53 To achieve this purpose, the EC apparently focussed on tariffs for products classified under heading 0207. However, the EC cannot now use the classification process to correct what it may now view as omissions or lacunae in its negotiated schedules.
84. Thus, the
EC's argument that the addition of salt is a mere artifice designed
to avoid the higher tariff for frozen cuts is legally irrelevant.54
As long as the product meets the description of the tariff heading,
the reasons why the exporter makes the product fall under that heading
are irrelevant. The motives of the exporter are simply irrelevant
to the issue of determining the correct customs classification of a
product. As the EC acknowledges, the purpose of the Harmonized
System was to ensure "greater uniformity among countries in customs
classification."55 For that reason, the paramount
consideration in determining the correct classification of a product
has always been the objective physical characteristics of the product
at issue. The Panel should not allow the EC's attempts to draw
negative inferences from rational commercial behaviour to distract it
from properly analyzing the classification of this product based solely
on its objective physical characteristics, in the light of the EC's
concession.
85. Thailand
requests the Panel to find that the EC is acting inconsistently with
its obligations under Article II:1(b) and II:1(a) of the GATT by according
"less favourable treatment" to the chicken product in question
than that provided for in the EC's Schedule of Concessions. Thailand
requests the Panel to recommend, in accordance with Article 19.1 of
the DSU, that the DSB request the EC to bring the measure at issue into
conformity with the GATT.
1 Appellate Body Report, Argentina – Measures Affecting Imports of Footwear, Textiles, Apparel and other Items ("Argentina – Textiles and Apparel"), WT/DS56/AB/R, para. 47.
2 As set out in the Dinter and Gausepohl judgements of the European Court of Justice, referred to in the EC's First Written Submission, para. 82.
3 Commission Regulation (EC) No. 535/94 of 9 March 1994, published in the Official Journal of the European Communities No. L 68, 11 March 1994, p. 15. ("Regulation 535/94") Exhibit THA-3.
4 Written Question E-3046/01 by Albert Maat (PPE-DE) to the Commission, 15 November 2002/C147/081. Exhibit THA-4.
5 Ibid.
6 Under Schedule LXXX the tariff rate provided for products under subheading 0207.41.10 is 1024 ECU/T, whereas under the EC's Combined Nomenclature, the tariff rate provided for products under subheading 0207.14.10 (the successor of heading 0207.41.10) is 102.4 € /100 kg/net.
7 Thai chicken exports to the EC stopped in June 2003 as a result of the avian flu problem. In June 2003, the price of chicken was 1738.78€/tonne. Exhibit THA-2.
8 Council Regulation (EEC) No. 2658/87, of 23 July 1987, on the tariff and statistical nomenclature and on the Common Customs Tariff, published in the Official Journal of the European Communities No. L 256, 7 September 1987, p. 1 ("Regulation No. 2658/87"). Exhibit THA-6 (only relevant portion).
9 Informal Meeting of Heads of Delegation of 20 January 1994, Statement of the Chairman, MTN.TNC/W/131, 21 January 1994. Exhibit THA-7.
10 Regulation 535/94 was only replaced on 14 November 2003 by Regulation 1871/2003, which entered into force on the 20th day following the day of its publication in the Official Journal on 25 October 2003.
11 Commission Regulation (EC) No. 3115/94 of 20 December 1994, amending Annexes I and II to Council Regulation (EEC) No. 2658/87 on the tariff and statistical nomenclature and on the common customs tariff, published in the Official Journal of the European Communities, No. L 345, 31 December 1994, p. 1. ("Regulation 3115/94"). Exhibit THA-8.
12 Commission Regulation (EC) No.1223/2002 of 8 July 2002 concerning the classification of certain goods in the Combined Nomenclature. Official Journal of the European Communities L 179, 9 July 2002, p.8 ("Regulation 1223/2002"). Exhibit THA-9.
13 Recital (2) of Regulation 1223/2002.
14 On 13 August 2002, the EC issued a Corrigendum regarding recital (5) of Regulation No. 1223/2002. Recital (5) of Regulation No. 1223/2002 stated that the measures provided for in Regulation No. 1223/2002 were in accordance with the opinion of the Customs Code Committee. Pursuant to the Corrigendum, recital (5) now provides that "[t]he Customs Code Committee has not issued an opinion within the time limit set by its Chairman." Official Journal of the European Communities, L 217, 13 August 2002, p.8. Exhibit THA-10.
15 Commission Decision of 31 January 2003 concerning the validity of certain binding tariff information issued by the Federal Republic of Germany. Official Journal of the European Communities No. L 36, 12 February 2003. Exhibit THA-11.
16 Commission Regulation (EC) No. 1871/2003, of 23 October 2003, amending Annex I to Council Regulation (EEC) No. 2658/87 on the tariff and statistical nomenclature and on the Common Customs Tariff, published in the Official Journal of the European Union No. L 275, 25 October 2003, p. 5 ("Regulation No. 1871/2003"). Exhibit THA-13. All references to the recitals are made to this document.
17 Appellate Body Report, European Communities – Customs Classification of Certain Computer Equipment ("EC – Computer Equipment") WT/DS62/AB/R, WT/DS67/AB/R, WT/DS68/AB/R, para. 84.
18 The Concise Oxford Dictionary, 9th Edition, Oxford University Press 1995, p. 1218.
19 Ibid., p. 163.
20 Ibid., p. 147.
21 Ibid., p. 1313.
22 Ibid., p. 541.
23 The American Heritage College Dictionary, 3rd edition, Houghton Mifflin Company, 1993, p. 545.
24 The Concise Oxford Dictionary, 9th edition, Oxford University Press, 1995, p. 228.
25 Ibid., p. 539.
26 American Heritage College Dictionary, 3rd edition, Houghton Mifflin Company, 1993, p.544.
27 B.J. Willenberg, Department of Food Science and Human Nutrition, University of Missouri-Columbia, http://muextension.missouri.edu/xplor/hesguide/foodnut/gh1501.htm, last accessed 3 August 2004. Exhibit THA-14.
28 The Concise Oxford Dictionary, 9th edition, Oxford University Press 1995, p. 1081.
29 American Heritage College Dictionary, 3rd edition, Houghton Mifflin Company, 1993, p. 1082.
30 Dr. Alan Sam, Food Safety Feature, United States Department of Agriculture, December 1999, http://www.fsis.usda.gov/OA/pubs/bastebrine.htm, last accessed 3 August 2004. Exhibit THA-15.
31 Effects of Preblending, Reduced Fat and Salt Levels on Frankfurter characteristics, Journal of Food Science, Volume 52, No.5, p. 1149 -1151, at 1151. Exhibit THA-16.
32 EC's First Written Submission, para. 39.
33 Ibid., para. 41.
34 Appellate Body Report, United States – Standards for Reformulated and Conventional Gasoline WT/DS2/AB/R, page 23.
35 Appellate Body Report, India – Patent Protection for Pharmaceutical and Agricultural Chemical Products (US), WT/DS50/AB/R, adopted 16 January 1998, para. 45.
36 EC's First Written Submission, para. 121.
37 Ibid., para. 122.
38 Ibid., para. 13.
39 See Regulation 2658/87.
40 General Rules for the Interpretation of the Harmonized System. Exhibit THA-20.
41 Therefore, as the titles of the Section (i.e. Live animals, animal products) and of the Chapter (i.e. Meat and edible meat offal) are provided for ease of reference only and have no legal status, they are not taken into account here for the purposes of classification.
42 Indeed, Commissioner Fischler recognised the difference between the usage of salt for temporary purposes which could be easily washed off and the usage of salt for longer-lasting duration. As quoted above, in his reply to the Member of Parliament referring to the imports of salted chicken from Thailand, among others, he stated: "… [t]he Honourable Member assumes that the meat in question is lightly salted and the salt may be shaken off. This fact would not be in conformity with the definition in the Combined Nomenclature which reads: 'For the purposes of heading 00210, the terms 'meat and edible meat offal, salted, in brine, mean meat and meat offal deeply and homogeneously impregnated in all parts having a total salt content of not less than 1.2% by weight'. The Commission is however not aware that imported salted poultry meat does not comply with this definition … " See Exhibit THA-4.
43 Council Regulation (EC) No. 930/2003 of 26 May 2003, terminating the anti-dumping and anti-subsidy proceedings concerning the imports of farmed Atlantic salmon originating in Norway and the anti-dumping proceedings concerning imports of farmed Atlantic salmon originating in Chile and the Faeroe Islands, published in the Official Journal of the European Communities No. L 133, 29 May 2003, p.01. para. 19. ("Regulation 930/2003") Exhibit THA-21.
44 EC's First Written Submission, Exhibit EC-14, Opinion of the Advocate General Tesauro, para. 7.
45 Exhibit THA-22.
46 Case 38-75, Douaneagent der NV Nederlandse Spoorwegen v Inspecteur der invoerrchten en accijnzen, 19 November 1975, ECR 1975, page 01439, at para. 10.
47 Appellate Body Report, EC – Computer Equipment, para. 92.
48 Ibid., para. 94.
49 Appellate Body Report, US – Shrimp, para. 129.
50 Appellate Body Report, Argentina – Textiles, para. 55.
51 See Exhibit THA-2.
52 EC's First Written Submission, para. 163.
53 Ibid., para. 54.
54 Ibid., para. 19.
55 Ibid., para. 61.
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