Abstract: At first glance, the Appellate Body Report in Bananas III (Article 21.5; Second Recourse) does not seem to be a case for the Guinness Book.

The AB upheld most of the Panel's findings, and the EC lost big. This was hardly surprising, given that the contested measure only marginally differed from the measure at issue in the first recourse to a compliance Panel. It is at second sight that this AB Report reveals its interesting facets. We highlight a few remarkable legal and economics aspects, some of a more systemic nature, some offering practical insights: For practitioners, the role of estoppel in WTO litigation, the legal effect of Panel suggestions, and the relevance of Uruguay Round Modalities Papers as interpretative tools may be of interest. Readers more concerned with systemic aspects of the WTO may take interest in the economics of tariff quotas, the inherently discriminatory nature of tariff-quota allocation in the WTO, and the relevance of compliance proceedings for the damage calculation under Article 22.6 of the DSU.

Introduction

The trade dispute over the European Community's banana importation regime is one of the longest-standing cases in the history of the WTO. The fact-load of this case is mind-boggling, and through the years Bananas has left a long trail of panels, arbitrations, and procedural battles. The Appellate Body (AB) Report on the second compliance Panel under Article 21.5 of the Dispute Settlement Understanding (DSU) is the presently last stage in the Bananas saga.