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Argentina—Measures Affecting Imports of Footwear, Textiles, Apparel and Other Items
World Trade Organization, Appellate Body
WT/DS56/AB/R (Apr. 22, 1998)
Argentina (defendant) agreed to a maximum amount of tariff duty rates in its General Agreement on Tariffs and Trade (GATT) Schedule. Those rates were set by percentage of the value of the goods imported, also known as ad valorem duty rates. Later, Argentina also adopted a minimum specific import duty as a flat rate, known as the Derechos de Importación Específicos Mínimos (DIEM). Under Argentina’s system, the DIEM was set based on a percentage of the representative international price. The customs officials setting the duties were instructed to use the higher of the ad valorem rate or the DIEM flat rate. As a result, products valued below the set representative international price were assessed the flat rate, which was necessarily higher than the ad valorem rate. This system was challenged as a violation of the GATT, Article II:1(b), which prohibited the imposition of a rate higher than in the GATT Schedule.
Rule of Law
Holding and Reasoning
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