Circulated to Members on 26 July 2002

On 8 March 2002, the Dispute Settlement Body (the “DSB”) adopted the Appellate Body Report and the Panel Report, as modified by the Appellate Body Report, in United States – Definitive Safeguard Measures on Imports of Circular Welded Carbon Quality Line Pipe from Korea (“US – Line Pipe”). At the DSB meeting of 5 April 2002, the United States informed the DSB, pursuant to Article 21.3 of the Understanding on Rules and Procedures Governing the Settlement of Disputes (the “DSU”), that it would implement the recommendations and rulings of the DSB in this dispute in a manner that respects its obligations and that it would require a “reasonable period of time” to do so, pursuant to the terms of Article 21.3 of the DSU.

In view of the parties’ inability to reach an agreement on the period of time reasonably required for implementation of those recommendations and rulings, Korea requested, in a letter dated 29 April 2002, that such period be determined by binding arbitration pursuant to Article 21.3(c) of the DSU.

In the absence of an agreement between the parties on the appointment of an arbitrator within 10 days after referring the matter to arbitration, Korea requested, in a letter dated 13 May 2002, the Director-General of the World Trade Organization (the “WTO”) to appoint the arbitrator, as provided for in footnote 12 to Article 21.3(c) of the DSU. After consultations with the parties, the Director- General decided, on 23 May 2002, to appoint me as the arbitrator in this matter. On the same day, the parties were informed of my acceptance of the designation as arbitrator.

In subsequent letters to me, the parties indicated that they agreed to extend the deadline for completion of the arbitration to 12 July 2002. Notwithstanding this extension of the 90-day time period stipulated in Article 21.3(c) of the DSU, the parties confirmed that the arbitration award shall be deemed to be an award issued under Article 21.3(c) of the DSU.

Written submissions were received from the United States and Korea on 3 June 2002, and an oral hearing was held on 12 June 2002.