The WTO panel report on U.S. - Safeguards on Photovoltaic Products was circulated today. Here are a few reactions based on a very quick read of the report.
First, it seems like kind of a big deal that a safeguard measure, and in particular a U.S. safeguard measure, was found not to be in violation of WTO rules. I've heard a number of people say that WTO jurisprudence in this area is so strict that it's impossible to impose a safeguard measure consistently with the rules. But now it has been done, so the rules may not be as constraining as was thought. (Previously, a WTO panel and the Appellate Body upheld a U.S. safeguard measure on tires under the now expired China-specific safeguard rules, but those provisions are easier to satisfy.) Perhaps this decision will have some impact on the views of some of the people in the U.S. who have been critical of WTO dispute settlement.
Second, based on my quick read, it seems to me that a big reason for the finding of no violation on the important issue of "unforeseen developments" was USTR's decision (a big thank you to whomever at USTR was behind this!) to ask the ITC to do a supplemental report on this issue, and the panel's decision to take that report into account. Back in January 2018, I said the following about this issue:
I wonder what a WTO panel and the AB will think of the fact that none of this showed up in the original ITC report, and, relatedly, what they will make of the USTR request that generated this reasoning in a subsequent report. My guess is that as long as they find the reasoning acceptable, they will forgive its omission from the original report, ...
My instincts seem to have been correct (but again, it was a very quick read!).
Third, this panel kept referring to "DSB reports." For example, in para. 7.18 it said:
As we agree with the findings in the previous DSB reports noted above, we will assess China's claims concerning the three elements in the first clause of Article XIX:1(a) of the GATT 1994 accordingly.
I don't think "DSB reports" is a normal thing for panels to say (and a quick search seemed to confirm that), and I wondered if this was part of the panel's attempt to reframe reliance on past reports, in two ways: 1) there would be no references to the "Appellate Body"; and 2) the panel expressed agreement with past reports, rather than a more deferential reliance on them.
And finally, I wonder how China will react to all of this. It could appeal the report into the void, in order to maintain some uncertainty about these issues. On the other hand, it would be a show of good faith to let the report be adopted and simply move on. That wouldn't solve the bigger issues surrounding China's participation in the WTO, but a gesture of this sort could help move things in a positive direction.
ADDED: I want to add something about the USTR request that the ITC do a supplemental report on the issue of unforeseen developments. I had forgotten that such a request was also made in the U.S. - Steel Safeguards case back in the early 2000s, as Jesse pointed out in the comments to this post. See paras. 10.119-135 of that panel report. I have not looked at the two ITC supplementary reports in the Steel Safeguards and Photovoltaic Safeguards cases to see how they compare and whether any differences might have contributed to the different results in these two panels' findings.
SECOND ADDITION: I've uploaded the ITC's supplemental report on unforeseen developments in the photovoltaic safeguards case here.
