Mandatory and Discretionary Legislation. See also Burden of Proof, General (B.3.1); Jurisdiction, General (J.2.1); Legislation as such vs. Specific Application (L.1); Municipal Law (M.5); Request for the Establishment of a Panel, Article 6.2 of the DSU - Specific measures at issue (R.2.3); Terms of Reference of Panels, Specific measures at issue (T.6.3)

M.1.1 US – 1916 Act, paras. 60–61

(WT/DS136/AB/R, WT/DS162/AB/R)

Prior to the entry into force of the WTO Agreement, it was firmly established that Article XXIII:1(a) of the GATT 1947 allowed a Contracting Party to challenge legislation as such, independently from the application of that legislation in Specific instances. While the text of Article XXIII does not expressly address the matter, panels consistently considered that, under Article XXIII, they had the jurisdiction to deal with claims against legislation as such. In examining such claims, panels developed the concept that mandatory and discretionary legislation should be distinguished from each other, reasoning that only legislation that mandates a violation of the GATT obligations can be found as such to be inconsistent with those obligations. We consider the application of this distinction to the present cases in section IV(B) below.

Thus, that a Contracting Party could challenge legislation as such before a panel was well – settled under the GATT 1947. We consider that the case law articulating and applying this practice forms part of the GATT acquis which, under Article XVI:1 of the WTO Agreement, provides guidance to the WTO and, therefore, to panels and the Appellate Body. Furthermore, in Article 3.1 of the DSU, Members affirm “their adherence to the principles for the management of disputes heretofore applied under Articles XXII and XXIII of the GATT 1947”. We note that, since the entry into force of the WTO Agreement, a number of panels have dealt with dispute settlement claims brought against a Member on the basis of its legislation as such, independently from the application of that legislation in Specific instances.