APPELLATE BODY REPORT, ARGENTINA

- MEASURES RELATING TO TRADE IN

GOODS AND SERVICES (WT/DS453
/AB/R)-ESPECIALLY ¶¶ 6.22-24, 6.102-106,
6.259-260
Student: Alkiviadis Konstantaros
LAW OF THE WORLD TRADE ORGANIZATION
LL.M. INTERNATIONAL AND EUROPEAN LAW Professor: Anastasios Gourgourinis
LAW SCHOOL OF ATHENS
NATIONAL AND KAPODISTRIAN UNIVERSITY OF ATHENS
 • The Parties:
• Panama (Complainant) Vs. Argentina (Respondent)
• The Agreements:
•
BASIC  GATS Arts. II:1, XVI, XVII and GATT Arts. I:1, III:2,
III:4, XI:1
ELEMENTS • Establishment of the Panel-25th June 2013
• Adoption of AB report- 9th May 2016
• Products and services at issue: Services and service
suppliers from countries that Argentina qualified as
countries not cooperating for tax transparency purposes.
 • This dispute concerns eight financial, taxation, foreign exchange and
registration measures imposed by Argentina mostly on services and
service suppliers from jurisdictions that do not exchange information with
Argentina for the purposes of fiscal transparency (“non-cooperative
jurisdictions”).

• The measures at issue in this dispute are the following:

•  Withholding tax on payments of interest or remuneration (measure 1);

MEASURE •  Presumption of unjustified increase in wealth (measure 2);

•  Transaction valuation based on transfer prices (measure 3);
S AT ISSUE •  Payment received rule for the allocation of expenditure (measure 4);
•  Requirements relating to reinsurance services (measure 5);
•  Requirements for access to the Argentine capital market (measure 6);
•  Requirements for the registration of branches (measure 7); and,
•  Foreign exchange authorization requirement (measure 8).
 INTERPRETATION OF ARTICLE XVII:1 GATS-
THE MEANING OF “LIKE” AND TREATMENT
NO LESS• FAVORABLE”
Article XVII
National
Treatment
“1. In the sectors inscribed in its Schedule, and
subject to any conditions and qualifications set
out therein, each Member shall accord to services
and service suppliers of any other Member, in
respect of all measures affecting the supply of
services, treatment no less favourable than that
it accords to its own like services and service
suppliers.”
AB began to interpret the ordinary meaning of the word “like”- AB: "like" refers to
something sharing a number of identical or similar characteristics or qualities.” AB
continued by considering the meaning of the provision in the French and Spanish
languages and concluded that the term ”like” implies a kind of comparison
• What extent of similarity is required for services and service suppliers to be considered
“like”? Contextual analysis:
• “In this respect, we turn to consider the context in which the word "like" appears in the
provisions of Articles II:1 and XVII:1 of the GATS. […] Article XVII is concerned with
competitive opportunities for like services and service suppliers of another Member.”
• China- Electronic Payment Services: if the services being compared are not in a
competitive relationship, the conditions of competition cannot be affected.
• It refers to an advantage- ordinary meaning
• This suggests that, also in the context of Article II of the GATS, the determination of
"likeness" of services and service suppliers must focus on the competitive relationship
of the services and service suppliers at issue.
INTERPRETATION OF ARTICLES II:1 AND XVII
GATS-THE MEANING OF “TREATMENT NO
LESS FAVORABLE”
Article II Most-Favoured-Nation Treatment
• Interpretation based on the text of the provisions- treatment no
• 1. With respect to any measure covered by this Agreement,
less favorable can be achieved by according “either formally
each Member shall accord immediately and unconditionally
to services and service suppliers of any other Member identical treatment or formally different treatment. Formally
treatment no less favourable than that it accords to like different treatment shall be considered to be less favourable if
services and service suppliers of any other country.
it modifies the conditions of competition in favour of services or
Article XVII National Treatment service suppliers of the Member compared to like services or
service suppliers of any other Member”.
• 1. In the sectors inscribed in its Schedule, and subject to any
conditions and qualifications set out therein, each Member • Interpretation based on the meaning of the provision- the
shall accord to services and service suppliers of any other
Member, in respect of all measures affecting the supply of standard of "treatment no less favourable" must be based on the
services, treatment no less favourable than that it accords to impact on the conditions of competition that results from the
its own like services and service suppliers.[*]
contested measure.
• 2. A Member may meet the requirement of paragraph 1 by
according to services and service suppliers of any other • Although the immediate context of this term in Articles II:1 and
Member, either formally identical treatment or formally
different treatment to that it accords to its own like services XVII:1 in the same way, and Article II does not contain the
and service suppliers. elaboration of the "less favourable treatment" standard found in
• 3. Formally identical or formally different treatment shall be Articles XVII:2 and 3, the Appellate Body has found that both
considered to be less favourable if it modifies the conditions
of competition in favour of services or service suppliers of provisions share the essential nature of anti-discrimination
the Me provisions, and cover both de jure and de facto discrimination.
INTERPRETATION OF THE WORD “MEASURE”

• Paragraph 2(a) of the Annex on Financial Services provides:

• 2. Domestic Regulation (a)
• Notwithstanding any other provisions of the Agreement, a
Member shall not be prevented from taking measures for
prudential reasons, including for the protection of investors,
depositors, policy holders or persons to whom a fiduciary
ACCORDING TO ARTICLE OBJECT AND PURPOSE OF GATS-
duty is owed by a financial service supplier, or to ensure the
XXVIII(A) THE WORD AN INTERPRETATION LIMITING integrity and stability of the financial system. Where such
“MEASURE” MEANS “ANY THE TYPES OF MEASURES THAT
MEASURE BY A MEMBER, COULD POTENTIALLY FALL measures do not conform with the provisions of the
WHETHER IN THE FORM OF A UNDER PARAGRAPH 2(A) Agreement, they shall not be used as a means of avoiding
LAW, REGULATION, RULE, WOULD NOT BE IN
PROCEDURE, DECISION, CONSONANCE WITH THE the Member's commitments or obligations under the
ADMINISTRATIVE ACTION, OR BALANCE OF RIGHTS AND
ANY OTHER FORM”-ORDINARY OBLIGATIONS THAT IS
Agreement.
MEANING EXPRESSLY RECOGNIZED IN THE
PREAMBLE OF THE GATS.