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DISPUTE SETTLEMENT: DISPUTE DS345

United States — Customs Bond Directive for Merchandise Subject to Anti-Dumping/Countervailing Duties

This summary has been prepared by the Secretariat under its own responsibility. The summary is for general information only and is not intended to affect the rights and obligations of Members.

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Summary up-to-date at

Panel Reports currently under appeal

Complaint by India.

On 6 June 2006, India requested consultations with the United States on the Amended Bond Directive and the enhanced bond requirement imposed by the United States on imports of frozen warmwater shrimp from India.  India considers that the Amended Bond Directive as such and the enhanced bond requirement are inconsistent with:

• Articles 1, 7.1, 7.2, 7.4, 7.5, 9.2, 9.3, 9.3.1, 18.1 and 18.5 of the Anti-Dumping Agreement;
    
• Articles I, II, III, VI:2, VI:3 (including Note 1 Ad paragraphs 2 and 3 of Article VI), X, XI and XIII of the GATT 1994;  and
    
• Articles 10, 17.4, 17.5, 19.3, 19.4, 32.1 and 32.5 of the SCM Agreement.

On 21 June 2006, Brazil, China and Thailand requested to join the consultations. The United States informed the DSB that they had accepted the requests of Brazil, China and Thailand to join the consultations.

On 13 October 2006, India requested the establishment of a panel. At its meeting on 26 October 2006, the DSB deferred the establishment of a panel. At its meeting on 21 November 2006, the DSB established a panel. Brazil, China, the European Communities, Japan and Thailand reserved their third party rights. On 19 January 2007, India requested the Director-General to compose the Panel. On 26 January 2007, the Director-General composed the Panel.

On 27 July 2007, the Chairman of the Panel informed the DSB that it would not be possible for the Panel to complete its work within six months of the date of composition, inter alia, due to the nature and scope of the dispute.

On 29 February 2008, the Panel report was circulated to Members. The Panel rejected India's claims that the laws, rules and regulations of the United States that authorize the imposition of the EBR and the instruments comprising the Amended CBD are inconsistent as such with the provisions of Articles 1, 7.1(iii), 7.2, 7.4, 9.1, 9.2, 9.3 (including 9.3.1), 18.1 and 18.4 of the Anti-Dumping Agreement;  Articles 10, 17.1(c), 17.2, 17.4, 19.2, 19.3, 19.4 and 32.1 of the SCM Agreement;  Articles VI:2 and VI:3 of the GATT 1994;  and the Ad Note thereto.

The Panel upheld India's claims that: (i) the application of the EBR to subject shrimp from India is inconsistent with Articles 1 and 18.1 of the Anti-Dumping Agreement, and the Ad Note;  that (ii) the application of the EBR to subject shrimp from India prior to the imposition of the anti-dumping order is inconsistent with Article 7.2 of the Anti-Dumping Agreement;  and that (iii) the United States violated Article 18.5 of the Anti-Dumping Agreement and Article 32.6 of the SCM Agreement because it failed to notify the Amended CBD to the Anti-Dumping and SCM Committees.

The Panel rejected the United States' argument that the application of the EBR is justified under Article XX(d) of the GATT 1994.

The Panel declined to rule separately on India's claims that:  (i) the application of the EBR to subject shrimp from India prior to the imposition of the anti-dumping order is inconsistent with Articles 7.1(iii), 7.4 and 7.5 of the Anti-Dumping Agreement;  that (ii) the application of the EBR to subject shrimp from India is inconsistent with Articles I:1, II:1(a) and (b), X(3)(a), XI:1 and XIII of the GATT 1994;  and that (iii) the laws, rules and regulations of the United States that authorize the imposition of the EBR and the instruments comprising the Amended CBD are inconsistent as such with Articles I:1, II:1(a) and (b), X(3)(a), XI:1 and XIII of the GATT 1994.

The Panel recommended that the United States bring its measures into conformity with its obligations under the Anti-Dumping Agreement and the GATT 1994.

On 17 April 2008, India notified its decision to request the Appellate Body to review certain issues of law covered in the Panel report and certain legal interpretations developed by the Panel. On 29 April 2008, the United States notified its decision to appeal to the Appellate Body certain issues of law covered in the Panel report and certain legal interpretations developed by the Panel.

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