The EC welcomed the findings of the Appellate Body (AB) and was satisfied that the AB had not only reversed the erroneous findings of the panel, but that it had also provided important clarification with respect to WTO compliance obligations in the context of a “retrospective” system of duty assessment. The EC also welcomed the systemic importance of the AB's finding that a panel established under Article 21.5 of the DSU had the mandate to rule on the WTO-consistency of “measures taken to comply” with the DSB rulings and agreed with the AB that what qualified a measure as a “measure taken to comply” was the existence of a “sufficiently close nexus, in terms of nature, effects and timing” with the relevant DSB recommendations and rulings. Whilst the EC did not agree with each and every aspect of the AB Report, it welcomed the finding in principle that the US should have immediately complied by the end of the reasonable period of time at the latest by eliminating zeroing from any further actions or inactions. According to the EC, the panel and AB findings were clear and the US was required to comply with them without delay by recalculating dumping margins without zeroing and collecting duties at non-zeroed rates.

The US was of the view that the reports being considered for adoption were not about zeroing but rather about key issues involving the question of the scope of compliance proceedings and what a member was expected to do after the end of the reasonable period of time with respect to collecting duties on entries of goods made prior to the end of the reasonable period of time. The AB raised a number of new problems, questions and uncertainties which the US had raised during the appeal but which were not addressed in the AB report. The US was disappointed that, in several respects, the AB report was not based on the recommendations and rulings made by the DSB in the original dispute. According to the US, the AB report expanded the scope of Article 21.5 to cover measures that did not, in fact, have an identifiable link to the recommendations and rulings in the original dispute. The US said that the AB report had replaced the recommendations and rulings of the DSB in the original dispute with recommendations and rulings from a subsequent zeroing dispute, raising serious systemic concerns.

With regard to the AB's finding of the existence of a supposed determination to assess duties at the cash deposit rate in Case 31, whilst appreciative of the issuance of a corrigendum by the AB (following a request from the US), the US was nonetheless concerned that the error had occurred in the first place. According to the US, the AB was not an investigating body and did not have the authority to make factual findings nor should it be researching and developing supposed facts that no party had submitted or argued. The US added that the corrigendum did not fully resolve the problem created by the report's initial assumptions regarding the supposed determination. Whilst the report acknowledged that no such determination had been identified, it nonetheless retained the reversal of the compliance panel's finding on this point.

Japan, Norway, Korea and Mexico (speaking as third parties to the dispute) and Hong-Kong China welcomed the AB report, saying that it had re-confirmed the illegality of the zeroing methodology. It was clear that the use of zeroing during administrative reviews after the expiration of the compliance period, regardless of the date of importation, was not consistent with the WTO rules, according to these speakers.

Japan highlighted some of the significant conclusions of the AB report and noted that the dispute was factually complex and had raised novel issues of law that had not been addressed or decided in previous disputes. With respect to the US' request for the correction of errors in the report and the subsequent corrigendum issued by the AB, Japan mentioned that factual inaccuracies or findings based on such unwarranted facts should not be tolerated and must be eliminated to the maximum extent possible so as to maintain the credibility of the reports and to avoid confusion. Norway expressed concern with regard to the US request to issue a corrigendum and was of the view that such actions should be avoided, with the exception of errors of a clerical nature. It was essential for the effectiveness of, and trust in, the system that the AB report be endorsed by all members as final, said Norway.

  

back to top

Next meeting 

The next meeting of the DSB is due to take place on 19 June 2009.