I.                   Reference to Arbitration

1.                  On 12 January 2000, the Dispute Settlement Body (the "DSB") adopted the Appellate Body Report[1] and the Panel Report [2], as modified by the Appellate Body Report, in  Chile  - Taxes on Alcoholic Beverages ("Chile – Alcoholic Beverages").  On 1 February 2000, Chile 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 but that it would require a "reasonable period of time" to do so, as provided for in Article 21.3 of the DSU.

2.                  Consultations between Chile and the European Communities regarding the duration of the reasonable period of time for implementation took place in Geneva, on 22 February 2000, and subsequently by telephone-conference, but these consultations did not produce agreement.