11:58 AM Jun 12, 1997

DSB SENDS INDONESIA CAR PROJECT DISPUTE TO PANEL

Geneva, 12 June (TWN) -- The Dispute Settlement Body of the World Trade Organization Thursday accepted the requests of Japan and the European Union and referred to a dispute settlement panel their complaints against Indonesia over its national car project.

The two separate disputes would be looked into by a single panel.

While no other country registered at the DSB meeting their third party interest in the case, under the rules they have ten days time to notify in writing about such interest, entitling them to present their own views to the panel.

The Indonesian measures are being attacked on the ground of the discriminatory tariffs to importers on the basis of their use of local content in manufacturing, the violation of the TRIMs agreement and the subsidies agreement, among others.

The EC invoked the rules of the subsidy agreement (annex V) and on dispute settlement for procedures to develop information concerning 'serious prejudice' (a necessary ingredient for actions against subsidies) and the DSB named Mr. Stuart Harbinson, representative of Hong Kong, as the DSB's representative for these procedures.

The Annex V of the subsidies agreement enables the DSB to initiate the procedure to obtain information from the government of the 'subsidizing member' to establish the existence and amount of subsidization, value of total sales of subsidized firms, as well as information necessary to analyze the adverse effects caused by the subsidized products. The process may include questions to the government of the subsidizing Member and of the complaining member to collect information, as well as to clarify and obtain elaboration of information available to the parties to the dispute through the notification procedures.

And if the issue relates to effects on third-country markets, a party to a dispute can collect from third country governments information including through questions necessary to assess adverse effects.

This gathering process is to be completed within 60 days, and the report submitted to the dispute panel.

Earlier, the DSB was advised that the EC was appealing the ruling on its banana regime, and the panel report set down for adoption was taken off the agenda.

Under other business, Norway complained of the increasing number of "leakages" of panel rulings and recommendations, and deplored in particular the leakage of rulings at the stage of interim review (when the panel gives its views to the parties for a review).

Norway felt this was one of the issues that should be taken up when the Dispute Settlement Understanding is to be reviewed. Such a review is mandated to be completed by 1999 and the outcome considered at the Ministerial meeting in year 2000.