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Complaint by India.
On 12 April 2012, India requested consultations with the United States with regard to the imposition of countervailing duties by the United States on certain hot rolled carbon steel flat products from India (“subject goods”).
India challenges countervailing duties levied on those products through various instruments, as well as provisions of the US Tariff Act and Code of Federal Regulations on customs duties. India claims that the countervailing duty investigation and related measures are inconsistent with Articles I and VI of the GATT 1994 and with Articles 1, 2, 10, 11, 12, 13, 14, 15, 19, 21 and 22 of the SCM Agreement. India also claims that the challenged provisions of US Law are inconsistent “as such” with Articles 12, 14, 15, 19 and 32 of the SCM Agreement.
On 7 May 2012, Canada requested to join the consultations.
On 12 July 2012, India requested the establishment of a panel. At its meeting on 23 July 2012, the DSB deferred the establishment of a panel.
Panel and Appellate Body proceedings
At its meeting on 31 August 2012, the DSB established a panel. Australia, Canada, China, the European Union, Saudi Arabia and Turkey reserved their third-party rights. On 7 February 2013, India requested the Director-General to determine the composition of the panel. On 18 February 2013, the Director-General composed the panel. On 8 July 2013, the Chair of the panel informed the DSB that the panel expects to issue its final report to the parties by April 2014, in accordance with the timetable adopted after consultation with the parties.
On 14 July 2014, the panel report was circulated to Members.
Summary of key findings
This dispute concerned the imposition by the United States of countervailing duties on imports of certain hot-rolled carbon steel flat products from India. India challenged certain provisions of the United States Tariff Act, 1930, as codified in the United States Code (USC), and the United States Code of Federal Regulations (CFR). In addition, India challenged a number of measures relating to the application of the USC and CFR in the context of the countervailing original investigation and subsequent reviews at issue. India's claims pertained to various procedural and substantive provisions of the SCM Agreement and, consequently, to Article VI of the GATT 1994 and Article XVI:4 of the WTO Agreement.
With regard to the United States' request for preliminary ruling relating to the scope of these proceedings, the Panel concluded that India's claims that the United States acted inconsistently with Articles 11.1, 11.2 and 11.9 of the SCM Agreement in connection with the alleged initiation of an investigation, despite the insufficiency of evidence in the domestic industry's written application, fell outside the Panel's terms of reference. The Panel dismissed the United States' remaining preliminary objections to India's claims.
With regard to India's claims that were within the scope of these proceedings, the Panel concluded that the United States acted inconsistently with:
- in connection with the provision of high grade iron ore by the NMDC:
- Article 2.1(c) of the SCM Agreement by failing to take account of all the mandatory factors in its determination of de facto specificity regarding NMDC; and
- Article 14(d) of the SCM Agreement by failing to consider the relevant domestic price information for use as Tier I benchmarks, in respect of which the United States sought to rely on ex post rationalization;
- in connection with the Captive Mining of Iron Ore Programme and the Captive Mining of Coal Programme:
- Article 12.5 of the SCM Agreement by failing to determine the existence of the Captive Mining of Iron Ore Programme on the basis of accurate information;
- Article 1.1(a)(1)(iii) of the SCM Agreement by determining without sufficient evidentiary basis that GOI granted Tata a financial contribution in the form of a captive coal mining lease under the Captive Mining of Coal Programme/Coal Mining Nationalization Act; and
- Article 14(d) of the SCM Agreement in connection with the USDOC's rejection of certain domestic price information when assessing benefit in respect of mining rights for iron ore;
- Article 15.3 of the SCM Agreement, with respect to Section 1677(7)(G) “as such” and “as applied” in the original investigation at issue, in connection with the “cross-cumulation” of the effects of imports that are subject to a CVD investigation with the effects of imports that are not subject to simultaneous CVD investigations;
- Articles 15.1, 15.2, 15.4 and 15.5 of the SCM Agreement, with respect to Section 1677(7)(G) “as such” and “as applied” in the original investigation at issue, in connection with injury assessments based on inter alia the volume, effects and impact of non-subsidized, dumped imports;
- Article 12.7 of the SCM Agreement by applying “facts available” devoid of any factual foundation in connection with the following determinations:
- JSW received iron ore from NMDC at no charge during the period covered by the 2006 administrative review;
- VMPL used and benefited from the 1993 KIP, 1996 KIP, 2001 KIP and 2006 KIP subsidy programmes;
- Tata used and benefited, during the period covered by the 2008 administrative review, from the following subsidy programmes under the 2001 JSIP: (1) capital investment incentive; (2) feasibility study and project report cost reimbursement; (3) incentive for quality certification; and (4) employment incentives;
- Tata used and benefited, during the period covered by the 2008 administrative review, from the following subsidy programmes: (1) 6 programmes at issue administered by the SGOG; (2) 8 programmes at issue administered by the SGOM; (3) 10 programmes at issue administered by the SGAP; (4) 9 programmes at issue administered by the SGOC; and (5) 22 programmes at issue administered by the SGOK;
- Tata used and benefited from the subsidy provided through the purchase of high-grade iron ore from NMDC during the period covered by the 2008 administrative review;
- Tata used and benefited from the MDA and MAI subsidy programmes during the period covered by the 2008 administrative review; and
- Tata used and benefited from the six sub-programmes of the SEZ Act at issue during the period covered by the 2008 administrative review;
- Article 22.5 of the SCM Agreement by failing to provide adequate notice of the USDOC's consideration of certain in-country benchmarks when assessing benefit conferred by NMDC's sales of iron ore.
The Panel exercised judicial economy in connection with a small number of India's claims, and rejected India's remaining claims.
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