From the EU's other appellant submission in EC - Seal Products:
284. The European Union appeals the Panel's finding that it "do[es] not consider that the legal standard with respect to the non-discrimination obligation under Article 2.1 of the TBT Agreement 'equally applies' to claims under Articles I:1 and III:4 of the GATT 1994"356. The European Union submits that the Panel's finding constitutes an erroneous interpretation of Articles I.1 and III:4 of the GATT 1994.
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288. The Panel suggests in essence the following diverging test for de facto violations of the non-discrimination provisions in the TBT Agreement and the GATT 1994: Under Article 2.1 of the TBT Agreement, "treatment no less favourable" requires (a) a detrimental impact on competitive opportunities of imports which (b) does not stem exclusively from a legitimate regulatory distinction. Under Articles I:1 and III:4 of the GATT 1994, on the other hand, the first element, i.e. the detrimental impact on imports, is sufficient to find discrimination.
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290. First, the interpretation of the Panel is contrary to established Appellate Body jurisprudence relating to Article III:4 of the GATT 1994.
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295. Second, the mechanical approach of the Panel to deduce de facto "less favourable treatment" from a detrimental impact on imports alone also disregards the context this term finds in Article III:1 of the GATT 1994.
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301. Third, the interpretation of Articles III:4 and I:1 which the Panel suggests is also wrong in that it is incoherent with the interpretation of Article 2.1 of the TBT Agreement. This divergence in the interpretation of de facto discrimination, which the Panel explicitly intends, fundamentally misunderstands the contextual relationship between the GATT and the TBT Agreement. ...
308. Fourth, the interpretation suggested by the Panel would render Article 2.1 of the TBT Agreement irrelevant. With the view to the divergent legal standards for de facto discriminations, complainants would have a strong incentive not to invoke Article 2.1 of the TBT Agreement, even if the measure qualified as a technical regulation, but instead to bring complaints under Articles I:1 and III:4 of the GATT 1994. ... It cannot be in the interest of the WTO dispute settlement system to render Article 2.1 of the TBT Agreement, and its interpretation in three recent Appellate Body rulings, irrelevant.
309. Finally, the European Union would note that the correct interpretation of Articles I:1 and III:4 of the GATT 1994, which requires for de facto claims both a detrimental impact on imports and the determination that it does not stem exclusively from a legitimate regulatory distinction, also leaves significant space for Article XX. The proposed correct interpretation would only concern de facto violations of discrimination prohibitions, in particular under Articles I:1 and III:4, and would not affect the relevance of Article XX for any other claims under the GATT 1994. Thus, Article XX would, first, remain applicable for the many provisions not relating to discrimination, for example Article XI. Secondly, the proposed correct interpretation does not extend to de jure discrimination claims. ...
Just three points (for now) on this issue.
First, I think we are all eagerly awaiting clarification from the AB on this issue.
Second, the implications are pretty big here. Is detrimental impact alone enough to find a violation of GATT Articles III:4/I:1? If so, how many thousands of violations are out there that we weren't aware of?
And third, I'm not sure the de facto/de jure distinction the EU makes is necessary for its argument.
