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if that WTO provision relates to the positive obligations of a WTO Member to provide for a certain procedural mechanism, such as in the TRIPS Agreement or the AntiDumping Agreement. In Japan's view, the refusal to comply with those obligations would per se constitute a violation of the WTO Agreement.
In its reply to the Panel's question, Japan also recalls, however, that the hypothesized situations in the Panel's question do not apply to the present case and that the question has no relevance in the present proceedings. The 1916 Act is clearly mandatory legislation that requires the US government to act in a manner that is inconsistent with its obligation under the WTO Agreement. According to Japan, the present case should be distinguished from the United States – Tobacco case, in that the text of the 1916 Act is quite clear and not at all vague.
The United States, in reply to the same question of the Panel, agrees with Japan that there is a reason to differentiate between the two situations. In the first scenario, the Panel should be guided by the interpretative principle of in dubio mitius. In EC Measures Concerning Meat and Meat Products (Hormones), the Appellate Body applied this principle in finding that the panel erred in adopting a "far‑reaching" interpretation of the SPS Agreement.49 The Appellate Body, quoting Oppenheim’s International Law, described this principle in footnote 154 as follows:
"The principle of in dubio mitius applies in interpreting treaties, in deference to the sovereignty of states. If the meaning of a term is ambiguous, that meaning is to be preferred which is less onerous to the party assuming an obligation, or which interferes less with the territorial and personal supremacy of a party, or involves less general restrictions upon the parties."
The United States notes that, as a result, if the 1916 Act can be interpreted so as to fall outside the scope of Article VI and the Anti‑Dumping Agreement, according to the principle in dubio mitius, that is the interpretation that should be adopted by the Panel. The 1916 Act can be and has been interpreted as an anti‑trust statute. There is no dispute in the present case that Article VI and the Anti‑Dumping Agreement do not apply to anti‑trust measures.
The United States considers that the second scenario should be governed by the principle laid down in the United States ‑ Tobacco case.
In response to another question of the Panel regarding the relationship between the GATT 1947/WTO practice in respect of mandatory/non-mandatory legislation and Article XVI:4 of the WTO Agreement, Japan notes that the obligation set out at Article XVI:4 "to ensure […] the conformity" of laws, regulations and administrative procedures, rather than the mandatory/discretionary dichotomy drawn from GATT 1947 practice, should apply in the present dispute. Article XVI:4 establishes that Members must alter laws, regulations and administrative procedures that do not conform to WTO provisions. The 1916 Act has been applied in a manner that has been applied in a manner that is inconsistent with US WTO obligations and, thus, the United States has violated Article XVI:4 by failing to conform the law the 1916 Act to its WTO obligations.50
49 Report of the Appellate Body on EC Measures Concerning Meat and Meat Products (Hormones), adopted on 16 January 1998, WT/DS26/AB/R, WT/DS48/AB/R, para.165 (hereinafter "Appellate Body Report on European Communities – Hormones").
50 In reply to a similar question of the United States, Japan states that, depending on the specific circumstances, the mandatory/non-mandatory distinction can still be a useful tool for analysing the WTO consistency of a domestic law or regulation. Japan considers that, in the present proceeding, it is not required to establish a general guideline as to the circumstances in which the distinction could be properly considered by the Panel.