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Issues covered by the WTO’s committees and agreements

REPERTORY OF APPELLATE BODY REPORTS

Anti-Dumping Agreement


ON THIS PAGE:

Article 1
Article 2 — Intent and effect of dumping
Article 2 — Period of investigation
Article 2.1 — “normal value … in the ordinary course of trade”
Article 2.1 — Sales below cost
Article 2.1 — Calculation of normal value
Article 2.1 — Fair comparison
Article 2.1 — Volume of dumped imports
Article 2.1 — Relationship with Article 11.3. See also Anti-Dumping Agreement, Article 11.3 (A.3.45-52)
Article 2.2.1 — Sales below cost and “ordinary course of trade”
Article 2.2.1.1 — “consider all available evidence on the proper allocation of costs”
Article 2.2.1.1 — “reasonably reflect” the cost of production
Article 2.2.2 — Low volume sales and “ordinary course of trade”
Article 2.2.2(ii) — Calculation of “weighted average”
Article 2.4 — Identity of seller and “fair comparison”
Article 2.4 — Calculation of dumping margins — Relationship with Article 11.3. See also Anti-Dumping Agreement, Article 11.3 (A.3.45-52)
Article 2.4.2 — Calculation of dumping margins — “zeroing”. See also Anti-Dumping Agreement, Article 2.2.1.1 — “consider all available evidence on the proper allocation of costs” (A.3.9A); Anti-Dumping Agreement, Article VI of the GATT 1994 (A.3.65)
Article 3.1 — general
Footnote 9 to Article 3
Article 3.1 — “positive evidence”
Article 3.1 — “objective examination”
Articles 3.1 and 3.2 — Method of calculating the “volume of the dumped imports”
Articles 3.1 and 3.2 — Calculation of the “volume of the dumped imports” without examining each producer or exporter individually. See also Anti-Dumping Agreement, Article 2.1 (A.3.3-8); Anti-Dumping Agreement, Article 3.3 (A.3.21); Anti-Dumping Agreement, Article 6.10 (A.3.37); Anti-Dumping Agreement, Article 9.4 (A.3.41-44)
Article 3.2 — No country-specific analysis of volume and prices of dumped imports
Article 3.3 — Cumulative assessment of dumped imports. See also Anti-Dumping Agreement, Article 3.2 (A.3.20)
Article 3.4 — Evaluation of injury factors
Article 3.4 — Manner of evaluating injury factors
Article 3.5 — Non-attribution of injury caused by other known factors
Article 3.5 — Examination of other known factors
Article 3.5 — Individual vs. Collective effects of other factors. See also Anti-Dumping Agreement, Articles 3.1 and 3.2 (A.3.18-19)
Article 3.7 — Threat of material injury
Article 5.4 — Motives of domestic producers for supporting investigation
Article 6 — Evidentiary rules for anti-dumping investigations. See also Anti-Dumping Agreement, Article 11.3 (A.3.45-52)
Article 6.1 — “ample opportunity to present in writing all evidence”. See also Anti-Dumping Agreement, Article 11.4 (A.3.53)
Article 6.2 — Opportunity for interested parties to defend their interests
Article 6.4 — Access to information relevant for interested parties to present their case. See also Anti-Dumping Agreement, Article 6.2 (A.3.31); Anti-Dumping Agreement, Article 11.4 (A.3.53)
Article 6.8 and Annex II — Facts available to investigating authorities
Article 6.8 and Annex II — Timeliness of parties’ submissions
Article 6.8 and Annex II — “reasonable period” for submission of information
Article 6.8 and Annex II — Lack of cooperation by investigated parties. See also Anti-Dumping Agreement, Article 11.4 (A.3.53)
Article 6.10 — No individual examination of all producers. See also Anti-Dumping Agreement, Articles 3.1 and 3.2 — Method of calculating the “volume of the dumped imports” (A.3.18); Anti-Dumping Agreement, Article 11.4 — Relationship with Article 6 (A.3.53)
Article 6.13 — Cooperation between interested parties and investigation authorities
Article 9.1 — Imposition of anti-dumping duties — Relationship with Articles 2 and 3
> Article 9.2 — Product-specific vs. Company-specific anti-dumping determination. See also Anti-Dumping Agreement, Article 11.3 (A.3.45-52)
> Article 9.4 — Calculation of the “all other” anti-dumping duty rate
> Article 9.4 — Relationship with Article 2.4.2
> Article 9.4 — Relationship with Article 6.8
> Article 9.4 — Relationship with paragraphs 1 and 2 of Article 3
> Article 11.3 — Sunset review — conditions. See also Anti-Dumping Agreement, Article 6 (A.3.29-38); Anti-Dumping Agreement, Article 9.2 (A.3.40); Anti-Dumping Agreement, Article 11.4 (A.3.53)
> Article 11.3 — Likelihood of continuation or recurrence of dumping
> Article 11.3 — Standard of review
> Article 11.3 — Nature of sunset review investigation
> Article 11.3 — Methodology for sunset review investigations
> Article 11.3 — Cumulation in sunset reviews. See also Anti-Dumping Agreement, Article 3.3 — Cumulative assessment of dumped imports (A.3.21)
> Article 11.3 — Relationship with Article 2. See also Anti-Dumping Agreement, Article 2.1 (A.3.3-8)
> Article 11.3 — No duty to investigate each known producer and exporter individually. See also Anti-Dumping Agreement, Article 11.4 (A.3.53)
> Article 11.3 — Determination of dumping margins and import volumes
> Article 11.3 — Likelihood determination based on evidence vs. presumptions
> Article 11.3 — Likelihood of continuation or recurrence of injury
> Article 11.3 — Relationship with Article 3
> Article 11.3 — Timeframe for likelihood of continuation or recurrence of injury
Article 11.4 — Relationship with Article 6. See also Anti-Dumping Agreement — Article 6 (A.3.29-38)
Article 17 — Dispute settlement. See also Special or Additional Rules and Procedures for Dispute Settlement (S.5)
Article 17.3 — Consultations. See also Consultations (C.7); Legislation as such vs. Specific Application (L.1); Terms of Reference of Panels, specific measure at issue (T.6.3)> 
Article 17.4 — “matter referred to the DSB”. See also Legislation as such vs. Specific Application (L.1); Terms of Reference of Panels (T.6)
Article 17.5 — Facts made available to the investigating authority. See also Request for the Establishment of a Panel (R.2)
Article 17.6 — Standard of Review under the Anti-Dumping Agreement. See also Standard of Review, Article 11 of the DSU (S.7.2-7)
Article 17.6(i) — “assessment of the facts”. See also Seek Information and Technical Advice (S.4); Standard of Review, Article 11 of the DSU — Objective assessment of the facts (S.7.3)
Article 17.6(ii) — “permissible interpretations”. See also Interpretation, General rules of treaty interpretation — Article 31 of the Vienna Convention (I.3.1); Standard of Review, Article 11 of the DSU — Objective assessment of the facts (S.7.3)
Article 18.1 — Specific action against dumping. See also Anti-Dumping Agreement, Article VI of the GATT 1994 (A.3.65); SCM Agreement, Article 32.1 — Specific action against a subsidy (S.2.36)
Article 18.4 — Ensure conformity of domestic anti-dumping laws, regulations and procedures. See also WTO Agreement, Article XVI:4 — WTO-conformity of laws, regulations and administrative procedures (W.4.3)
Relationship between the Anti-Dumping Agreement and the SCM Agreement
Relationship between the Anti-Dumping Agreement and the GATT 1994
Article VI of the GATT 1994 — Anti-dumping duties. See also Anti-Dumping Agreement, Article 18.1 (A.3.61) 
 


Article 1. See Anti-Dumping Agreement, Article VI of the GATT 1994 — Anti-Dumping duties (A.3.65)     back to top

 
A.3.1 Article 2 — Intent and effect of dumping     back to top

A.3.1.1 US — 1916 Act, para. 107
(WT/DS136/AB/R, WT/DS162/AB/R)

… under Article VI:1 of the GATT 1994 and Article 2 of the Anti-Dumping Agreement, neither the intent of the persons engaging in “dumping” nor the injurious effects that “dumping” may have on a Member’s domestic industry are constituent elements of “dumping”.

 
A.3.2 Article 2 — Period of investigation     back to top

A.3.2.1 EC — Tube or Pipe, para. 80
(WT/DS219/AB/R)

Permitting such discretionary selection of data from a period of time within the POI would defeat the objectives underlying investigating authorities’ reliance on a POI for the purposes of a dumping determination. As the Panel correctly noted, the POI “form[s] the basis for an objective and unbiased determination by the investigating authority.” Like the Panel and the parties to this dispute, we understand a POI to provide data collected over a sustained period of time, which period can allow the investigating authority to make a dumping determination that is less likely to be subject to market fluctuations or other vagaries that may distort a proper evaluation. We agree with the Panel that the standardized reliance on a POI, although not fixed in duration by the Anti-Dumping Agreement, assures the investigating authority and exporters of “a consistent and reasonable methodology for determining present dumping”, which anti-dumping duties are intended to offset. In contrast to this consistency and reliability, Brazil’s approach would introduce a significant level of subjectivity on the part of the investigating authority to determine when data from a subset of the POI may be a reliable indicator of an exporter’s future pricing behaviour. …

 
A.3.3 Article 2.1 — “normal value … in the ordinary course of trade”     back to top

A.3.3.1 US — Hot-Rolled Steel, para. 139
(WT/DS184/AB/R)

Article 2.1 of the Anti-Dumping Agreement provides that normal value — the price of the like product in the home market of the exporter or producer — must be established on the basis of sales made “in the ordinary course of trade”. Thus, sales which are not made “in the ordinary course of trade” must be excluded, by the investigating authorities, from the calculation of normal value. …

A.3.3.2 US — Hot-Rolled Steel, para. 140
(WT/DS184/AB/R)

In terms of the above definition, Article 2.1 requires investigating authorities to exclude sales not made “in the ordinary course of trade”, from the calculation of normal value, precisely to ensure that normal value is, indeed, the “normal” price of the like product, in the home market of the exporter. Where a sales transaction is concluded on terms and conditions that are incompatible with “normal” commercial practice for sales of the like product, in the market in question, at the relevant time, the transaction is not an appropriate basis for calculating “normal” value.

A.3.3.3 US — Hot-Rolled Steel, para. 142
(WT/DS184/AB/R)

We note that determining whether a sales price is higher or lower than the “ordinary course” price is not simply a question of comparing prices. Price is merely one of the terms and conditions of a transaction. To determine whether the price is high or low, the price must be assessed in light of the other terms and conditions of the transaction. Thus, the volume of the sales transaction will affect whether a price is high or low. Or, the seller may undertake additional liability or responsibilities in some transactions, for instance for transport or insurance. These, and a number of other factors, may be expected to affect an assessment of the price.

A.3.3.4 US — Hot-Rolled Steel, para. 145
(WT/DS184/AB/R)

In our view, the duties of investigating authorities, under Article 2.1 of the Anti-Dumping Agreement, are precisely the same, whether the sales price is higher or lower than the “ordinary course” price, and irrespective of the reason why the transaction is not “in the ordinary course of trade”. Investigating authorities must exclude, from the calculation of normal value, all sales which are not made “in the ordinary course of trade”. To include such sales in the calculation, whether the price is high or low, would distort what is defined as “normal value”.

A.3.3.5 US — Hot-Rolled Steel, para. 146
(WT/DS184/AB/R)

In view of the many different types of transaction not “in the ordinary course of trade” — some including affiliated parties, others not; some including high prices, others low prices; some including prices below cost, others not — investigating authorities need not, under the Anti-Dumping Agreement, scrutinize, according to identical rules, each and every category of sale that is potentially not “in the ordinary course of trade”.

 
A.3.4 Article 2.1 — Sales below cost     back to top

A.3.4.1 US — Hot-Rolled Steel, para. 147
(WT/DS184/AB/R)

We note that Article 2.2.1 of the Anti-Dumping Agreement itself provides for a method for determining whether sales below cost are “in the ordinary course of trade”. However, that provision does not purport to exhaust the range of methods for determining whether sales are “in the ordinary course of trade”, nor even the range of possible methods for determining whether low-priced sales are “in the ordinary course of trade”. Article 2.2.1 sets forth a method for determining whether sales between any two parties are “in the ordinary course of trade”; it does not address the more specific issue of transactions between affiliated parties. In transactions between such parties, the affiliation itself may signal that sales above cost, but below the usual market price, might not be in the ordinary course of trade. Such transactions may, therefore, be the subject of special scrutiny by the investigating authorities.

A.3.4.2 US — Hot-Rolled Steel, para. 148
(WT/DS184/AB/R)

Although we believe that the Anti-Dumping Agreement affords WTO Members discretion to determine how to ensure that normal value is not distorted through the inclusion of sales that are not “in the ordinary course of trade”, that discretion is not without limits. In particular, the discretion must be exercised in an even-handed way that is fair to all parties affected by an anti-dumping investigation. If a Member elects to adopt general rules to prevent distortion of normal value through sales between affiliates, those rules must reflect, even-handedly, the fact that both high and low-priced sales between affiliates might not be “in the ordinary course of trade”.

 
A.3.5 Article 2.1 — Calculation of normal value     back to top

A.3.5.1 US — Hot-Rolled Steel, para. 165
(WT/DS184/AB/R)

The text of Article 2.1 expressly imposes four conditions on sales transactions in order that they may be used to calculate normal value: first, the sale must be “in the ordinary course of trade”; second, it must be of the “like product”; third, the product must be “destined for consumption in the exporting country”; and, fourth, the price must be “comparable”.

A.3.5.2 US — Hot-Rolled Steel, para. 166
(WT/DS184/AB/R)

The text of Article 2.1 is, however, silent as to who the parties to relevant sales transactions should be. Thus, Article 2.1 does not expressly mandate that the sale be made by the exporter for whom a margin of dumping is being calculated. Nor does Article 2.1 expressly preclude that relevant sales transactions might be made downstream, between affiliates of the exporter and independent buyers. In our view, provided that all of the explicit conditions in Article 2.1 of the Anti-Dumping Agreement are satisfied, the identity of the seller of the “like product” is not a ground for precluding the use of a downstream sales transaction when calculating normal value. In short, we see no reason to read into Article 2.1 an additional condition that is not expressed.

 
A.3.6 Article 2.1 — Fair comparison     back to top

A.3.6.1 US — Hot-Rolled Steel, para. 167
(WT/DS184/AB/R)

We do not mean to suggest that the identity of the seller is irrelevant in calculating normal value under Article 2.1 of the Anti-Dumping Agreement. However, to ensure that prices are “comparable”, the Anti-Dumping Agreement provides a mechanism, in Article 2.4, which allows investigating authorities to take full account of the fact, as appropriate, that a relevant sale was not made by the exporter or producer itself, but was made by another party. Article 2.4 requires that a “fair comparison” be made between export price and normal value. This comparison “shall be made at the same level of trade, normally at the ex-factory level”. In making a “fair comparison”, Article 2.4 mandates that due account be taken of “differences which affect price comparability”, such as differences in the “levels of trade” at which normal value and export price are calculated.

 
A.3.7 Article 2.1 — Volume of dumped imports     back to top

A.3.7.1 EC — Bed Linen (Article 21.5 — India), para. 143
(WT/DS141/AB/RW)

… We see no conflict between the provisions requiring producer-specific determinations and the need to calculate, for purposes of determining injury, the total volume of dumped imports from producers or exporters originating in a particular exporting country as a whole. This can be done, and has to be done, by adding up the volume of imports attributable to producers or exporters that are dumping, whether on the basis of an individual examination or on the basis of an extrapolation. Further, we see nothing in the text of Article 2.1 that permits a derogation from the express requirements in paragraphs 1 and 2 of Article 3 to determine the volume of dumped imports on the basis of “positive evidence” and an “objective examination”.

 
A.3.8 Article 2.1 — Relationship with Article 11.3.
See also Anti-Dumping Agreement, Article 11.3 (A.3.45-52)     back to top

A.3.8.1 US — Corrosion-Resistant Steel Sunset Review, para. 109
(WT/DS244/AB/R)

We agree with Japan that the words “[f]or the purpose of this Agreement” in Article 2.1 indicate that this provision describes the circumstances in which a product is to be considered as being dumped for purposes of the entire Anti-Dumping Agreement, including Article 11.3. This interpretation is supported by the fact that Article 11.3 does not indicate, either expressly or by implication, that “dumping” has a different meaning in the context of sunset reviews than in the rest of the Anti-Dumping Agreement. Therefore, Article 2.1 of the Anti-Dumping Agreement and Article VI:1 of the GATT 1994 suggest that the question for investigating authorities, in making a likelihood determination in a sunset review pursuant to Article 11.3, is whether the expiry of the duty would be likely to lead to continuation or recurrence of dumping of the product subject to the duty (that is, to the introduction of that product into the commerce of the importing country at less than its normal value). …

 
A.3.9 Article 2.2.1 — Sales below cost and “ordinary course of trade”     back to top

A.3.9.1 US — Hot-Rolled Steel, para. 147
(WT/DS184/AB/R)

We note that Article 2.2.1 of the Anti-Dumping Agreement itself provides for a method for determining whether sales below cost are “in the ordinary course of trade”. However, that provision does not purport to exhaust the range of methods for determining whether sales are “in the ordinary course of trade”, nor even the range of possible methods for determining whether low-priced sales are “in the ordinary course of trade”. Article 2.2.1 sets forth a method for determining whether sales between any two parties are “in the ordinary course of trade”; it does not address the more specific issue of transactions between affiliated parties. In transactions between such parties, the affiliation itself may signal that sales above cost, but below the usual market price, might not be in the ordinary course of trade. Such transactions may, therefore, be the subject of special scrutiny by the investigating authorities.

 
A.3.9A Article 2.2.1.1 — “consider all available evidence on the proper allocation of costs”     back to top

A.3.9A.1 US — Softwood Lumber V, paras. 133-135
(WT/DS264/AB/R)

… The ordinary meaning of the term “consider” is, inter alia, to “look at attentively”, “reflect on”, or to “weigh the merits of”. In the context of the second sentence of Article 2.2.1.1, we read the term “consider” to mean that an investigating authority is required, when addressing the question of proper allocation of costs for a producer or exporter, to “reflect on” and to “weigh the merits of” “all available evidence on the proper allocation of costs”. … the requirement to “consider” evidence would not be satisfied by simply “receiving evidence” or merely “tak[ing] notice of evidence”.

… The word “proper”, in our view, supports our reading of the word “consider”, because it suggests some degree of deliberation on the part of the investigating authority in “consider[ing] all available evidence”, so as to ensure that there is a proper allocation of costs. The nature of this deliberative process will depend on the facts of a particular case before the investigating authority.

We are aware that the term “comparison”, which is derived from the verb “compare”, is used in other provisions of the Anti-Dumping Agreement. For instance, Articles 2.4 and 2.4.2 refer to the “comparison” of export prices and normal value, for purposes of establishing the existence of margins of dumping. As both the word “consider” and the word “comparison” are used in the Anti-Dumping Agreement, it follows, in our view, that the non-inclusion, by the drafters of the Anti-Dumping Agreement, in Article 2.2.1.1 of the word “compare” is not a mere oversight, but rather a purposeful act of drafting. However, as we explain below, we do not believe that this requires an interpretation that the second sentence of Article 2.2.1.1 does not, under any circumstances, require an investigating authority to compare methodologies.

A.3.9A.2 US — Softwood Lumber V, paras. 137-138
(WT/DS264/AB/R)

The second sentence of Article 2.2.1.1 requires an investigating authority to “consider” all available evidence on the proper allocation of costs, which in certain circumstances may require the investigating authority to consider alternative allocation methodologies. Therefore, the issue before us is not simply whether the word “consider”, in and of itself, entails a requirement to “compare”. Rather, the issue before us is whether a requirement to “consider all available evidence on the proper allocation of costs” does or does not require an investigating authority to “compare” advantages and disadvantages of alternative cost allocation methodologies.

In our view, the parameters of the obligation to “consider all available evidence” will vary case-by-case. It may well be that, in the light of the facts of a particular case, the requirement to “consider all available evidence” may be satisfied by the investigating authority without comparing allocation methodologies or aspects thereof. However, in other instances — such as where there is compelling evidence available to the investigating authority that more than one allocation methodology potentially may be appropriate to ensure that there is a proper allocation of costs — the investigating authority may be required to “reflect on” and “weigh the merits of” evidence that relates to such alternative allocation methodologies, in order to satisfy the requirement to “consider all available evidence”. Thus, although the second sentence of Article 2.2.1.1 does not, as a general rule, require investigating authorities to compare allocation methodologies to assess their respective advantages and disadvantages in each and every case, there may be particular instances in which the investigating authority may be required to compare them in order to satisfy the explicit requirement of the second sentence of Article 2.2.1.1 to “consider all available evidence on the proper allocation of costs”.

 
A.3.9B Article 2.2.1.1 — “reasonably reflect” the cost of production     back to top

A.3.9B.1 US — Softwood Lumber V, para. 165
(WT/DS264/AB/R)

Canada argues that USDOC, in evaluating whether Tembec’s records “reasonably reflect” the cost of production of the product under consideration (that is, softwood lumber), failed to exercise its discretion in an even-handed manner. …

A.3.9B.2 US — Softwood Lumber V, para. 163
(WT/DS264/AB/R)

… Whether a particular approach of an investigating authority is, or is not, even-handed is, ultimately, a matter of the “legal characterization” of facts and, as such, a matter of law. We are thus unable to agree with the United States that the issue raised by Canada with respect to the lack of even-handed treatment on the part of USDOC is beyond the scope of appellate review.

 
A.3.10 Article 2.2.2 — Low volume sales and “ordinary course of trade”     back to top

A.3.10.1 EC — Tube or Pipe, para. 98
(WT/DS219/AB/R)

As the Panel correctly observed, it is meaningful for the interpretation of Article 2.2.2 that Article 2.2 specifically identifies low-volume sales in addition to sales outside the ordinary course of trade. In contrast to Article 2.2, the chapeau of Article 2.2.2 explicitly excludes only sales outside the ordinary course of trade. The absence of any qualifying language related to low volumes in Article 2.2.2 implies that an exception for low-volume sales should not be read into Article 2.2.2. …

A.3.10.2 EC — Tube or Pipe, para. 101
(WT/DS219/AB/R)

… In our view, where, as in this investigation, low-volume sales are in the ordinary course of trade, an investigating authority does not act inconsistently with the chapeau of Article 2.2.2 by including actual data from those sales to derive SG&A and profits for the construction of normal value.

 
A.3.11 Article 2.2.2(ii) — Calculation of “weighted average”     back to top

A.3.11.1 EC — Bed Linen, para. 76
(WT/DS141/AB/R)

… the use of the phrase “weighted average”, combined with the use of the words “amounts” and “exporters or producers” in the plural in the text of Article 2.2.2(ii), clearly anticipates the use of data from more than one exporter or producer. We conclude that the method for calculating amounts for SG&A and profits set out in this provision can only be used if data relating to more than one other exporter or producer is available.

A.3.11.2 EC — Bed Linen, para. 80
(WT/DS141/AB/R)

… in the calculation of the “weighted average”, all of “the actual amounts incurred and realized” by other exporters or producers must be included, regardless of whether those amounts are incurred and realized on production and sales made in the ordinary course of trade or not. Thus, in our view, a Member is not allowed to exclude those sales that are not made in the ordinary course of trade from the calculation of the “weighted average” under Article 2.2.2(ii).

 
A.3.12 Article 2.4 — Identity of seller and “fair comparison”     back to top

A.3.12.1 US — Hot-Rolled Steel, para. 167
(WT/DS184/AB/R)

We do not mean to suggest that the identity of the seller is irrelevant in calculating normal value under Article 2.1 of the Anti-Dumping Agreement. However, to ensure that prices are “comparable”, the Anti-Dumping Agreement provides a mechanism, in Article 2.4, which allows investigating authorities to take full account of the fact, as appropriate, that a relevant sale was not made by the exporter or producer itself, but was made by another party. Article 2.4 requires that a “fair comparison” be made between export price and normal value. This comparison “shall be made at the same level of trade, normally at the ex-factory level”. In making a “fair comparison”, Article 2.4 mandates that due account be taken of “differences which affect price comparability”, such as differences in the “levels of trade” at which normal value and export price are calculated.

 
A.3.13 Article 2.4 — Calculation of dumping margins — Relationship with Article 11.3.
See also Anti-Dumping Agreement, Article 11.3 (A.3.45-52)     back to top

A.3.13.1 US — Corrosion-Resistant Steel Sunset Review, paras. 127-128
(WT/DS244/AB/R)

Article 2 sets out the agreed disciplines in the Anti-Dumping Agreement for calculating dumping margins. As observed earlier, we see no obligation under Article 11.3 for investigating authorities to calculate or rely on dumping margins in determining the likelihood of continuation or recurrence of dumping. However, should investigating authorities choose to rely upon dumping margins in making their likelihood determination, the calculation of these margins must conform to the disciplines of Article 2.4. … USDOC chose to base its affirmative likelihood determination on positive dumping margins that had been previously calculated in two particular administrative reviews. If these margins were legally flawed because they were calculated in a manner inconsistent with Article 2.4, this could give rise to an inconsistency not only with Article 2.4, but also with Article 11.3 of the Anti-Dumping Agreement.

It follows that we disagree with the Panel’s view that the disciplines in Article 2 regarding the calculation of dumping margins do not apply to the likelihood determination to be made in a sunset review under Article 11.3. …

 
A.3.14 Article 2.4.2 — Calculation of dumping margins — “zeroing”.
See also Anti-Dumping Agreement, Article 2.2.1.1 — “consider all available evidence on the proper allocation of costs” (A.3.9A); Anti-Dumping Agreement, Article VI of the GATT 1994 (A.3.65)     back to top

A.3.14.1 EC — Bed Linen, para. 53
(WT/DS141/AB/R)

… We see nothing in Article 2.4.2 or in any other provision of the Anti-Dumping Agreement that provides for the establishment of “the existence of margins of dumping” for types or models of the product under investigation; to the contrary, all references to the establishment of “the existence of margins of dumping” are references to the product that is subject of the investigation. … Whatever the method used to calculate the margins of dumping, in our view, these margins must be, and can only be, established for the product under investigation as a whole. …

A.3.14.2 EC — Bed Linen, para. 55
(WT/DS141/AB/R)

… the investigating authorities are required to compare the weighted average normal value with the weighted average of prices of all comparable export transactions. Here, we emphasize that Article 2.4.2 speaks of “all” comparable export transactions. As explained above, when “zeroing”, the European Communities counted as zero the “dumping margins” for those models where the “dumping margin” was “negative”. As the Panel correctly noted, for those models, the European Communities counted “the weighted average export price to be equal to the weighted average normal value … despite the fact that it was, in reality, higher than the weighted average normal value.” By “zeroing” the “negative dumping margins”, the European Communities, therefore, did not take fully into account the entirety of the prices of some export transactions, namely, those export transactions involving models of cotton-type bed linen where “negative dumping margins” were found. … Thus, the European Communities did not establish “the existence of margins of dumping” for cotton-type bed linen on the basis of a comparison of the weighted average normal value with the weighted average of prices of all comparable export transactions…

A.3.14.3 EC — Bed Linen, para. 58
(WT/DS141/AB/R)

Having defined the product at issue and the “like product” on the Community market as it did, the European Communities could not, at a subsequent stage of the proceeding, take the position that some types or models of that product had physical characteristics that were so different from each other that these types or models were not “comparable”. All types or models falling within the scope of a “like” product must necessarily be “comparable”, and export transactions involving those types or models must therefore be considered “comparable export transactions” within the meaning of Article 2.4.2.

A.3.14.4 US — Corrosion-Resistant Steel Sunset Review, paras. 135-136
(WT/DS244/AB/R)

When investigating authorities use a zeroing methodology such as that examined in EC — Bed Linen to calculate a dumping margin, whether in an original investigation or otherwise, that methodology will tend to inflate the margins calculated. Apart from inflating the margins, such a methodology could, in some instances, turn a negative margin of dumping into a positive margin of dumping. As the Panel itself recognized in the present dispute, “zeroing … may lead to an affirmative determination that dumping exists where no dumping would have been established in the absence of zeroing.” Thus, the inherent bias in a zeroing methodology of this kind may distort not only the magnitude of a dumping margin, but also a finding of the very existence of dumping.

… we note that the United States seemed to accept that USDOC’s methodology in the administrative reviews was “a methodology in which no offset is granted to the respondent for negative differences between the normal value and export price (or constructed export price) of individual transactions”. …

A.3.14.5 EC — Tube or Pipe, para. 76
(WT/DS219/AB/R)

… We fail to see how Article VI:2, by stating that the purpose of anti-dumping duties is “to offset or prevent dumping”, imposes upon investigating authorities an obligation to select any particular methodology for comparing normal value and export prices under Article 2.4.2 of the Anti-Dumping Agreement when calculating a dumping margin. …

A.3.14.6 US — Softwood Lumber V, paras. 80-81
(WT/DS264/AB/R)

We note that there is no disagreement among the participants in this dispute as to the permissibility of “multiple averaging” under Article 2.4.2. All participants agree that an investigating authority may choose to divide the product under investigation into product types or models for purposes of calculating a weighted average normal value and a weighted average export price for the transactions involving each product type or model or sub-group of “comparable” transactions. …

We agree with the participants in this dispute that multiple averaging is permitted under Article 2.4.2 to establish the existence of margins of dumping for the product under investigation. We disagree with those who suggest that the Appellate Body Report in EC — Bed Linen is premised on an assumption that multiple averaging is prohibited. The issue of multiple averaging was not before the Appellate Body in EC — Bed Linen and the reasoning of the Appellate Body in that case should therefore not be read as prohibiting that practice. …

A.3.14.7 US — Softwood Lumber V, para. 86
(WT/DS264/AB/R)

Article 2.4.2 requires that the existence of margins of dumping “shall normally be established on the basis of a comparison of a weighted average normal value with a weighted average of prices of all comparable export transactions”. (emphasis added) It is clear from the language of Article 2.4.2 that a weighted average normal value is to be compared with a weighted average of the prices of “comparable” export transactions, and not with prices of “non-comparable” export transactions. At the same time, the word “all” in “all comparable export transactions” makes it clear that Members cannot exclude from a comparison any transaction that is “comparable”. Thus, we agree with the Panel that the term “all comparable export transactions” means that a Member “may only compare those export transactions which are comparable, but [] it must compare all such transactions.”

A.3.14.8 US — Softwood Lumber V, para. 93
(WT/DS264/AB/R)

It is clear from the texts of [Article VI:1 of the GATT 1994 and Article 2.1 of the Anti-Dumping Agreement] that dumping is defined in relation to a product as a whole as defined by the investigating authority. Moreover, we note that the opening phrase of Article 2.1 — “[f]or the purpose of this Agreement” — indicates that the definition of “dumping” as contained in Article 2.1 applies to the entire Agreement, which includes, of course, Article 2.4.2. “Dumping”, within the meaning of the Anti-Dumping Agreement, can therefore be found to exist only for the product under investigation as a whole, and cannot be found to exist only for a type, model, or category of that product.

A.3.14.9 US — Softwood Lumber V, paras. 96-98
(WT/DS264/AB/R)

The Appellate Body found in EC — Bed Linen that “[w]hatever the method used to calculate the margins of dumping … these margins must be, and can only be, established for the product under investigation as a whole.” While “dumping” refers to the introduction of a product into the commerce of another country at less than its normal value, the term “margin of dumping” refers to the magnitude of dumping. As with dumping, “margins of dumping” can be found only for the product under investigation as a whole, and cannot be found to exist for a product type, model, or category of that product.

It is clear that an investigating authority may undertake multiple averaging to establish margins of dumping for a product under investigation. In our view, the results of the multiple comparisons at the sub-group level are, however, not “margins of dumping” within the meaning of Article 2.4.2. Rather, those results reflect only intermediate calculations made by an investigating authority in the context of establishing margins of dumping for the product under investigation. Thus, it is only on the basis of aggregating all these “intermediate values” that an investigating authority can establish margins of dumping for the product under investigation as a whole.

We fail to see how an investigating authority could properly establish margins of dumping for the product under investigation as a whole without aggregating all of the “results” of the multiple comparisons for all product types. There is no textual basis under Article 2.4.2 that would justify taking into account the “results” of only some multiple comparisons in the process of calculating margins of dumping, while disregarding other “results”. If an investigating authority has chosen to undertake multiple comparisons, the investigating authority necessarily has to take into account the results of all those comparisons in order to establish margins of dumping for the product as a whole under Article 2.4.2. …

A.3.14.10 US — Softwood Lumber V, para. 100
(WT/DS264/AB/R)

… Article 2.4.2 contains no express language that permits an investigating authority to disregard the results of multiple comparisons at the aggregation stage. Other provisions of the Anti-Dumping Agreement are explicit regarding the permissibility of disregarding certain matters. For example, Article 2.2.1 of the Anti-Dumping Agreement, which deals with the calculation of normal value, sets forth the only circumstances under which sales of the like product may be disregarded. Similarly, Article 9.4 of the Anti-Dumping Agreement expressly directs investigating authorities to “disregard” zero and de minimis margins of dumping, under certain circumstances, when calculating the weighted average margin of dumping to be applied to exporters or producers that have not been individually investigated. Thus, when the negotiators sought to permit investigating authorities to disregard certain matters, they did so explicitly.

A.3.14.11 US — Softwood Lumber V, paras. 101-104
(WT/DS264/AB/R)

We now turn to the implications of zeroing as applied in this case. Zeroing means, in effect, that at least in the case of some export transactions, the export prices are treated as if they were less than what they actually are. Zeroing, therefore, does not take into account the entirety of the prices of some export transactions, namely, the prices of export transactions in those sub-groups in which the weighted average normal value is less than the weighted average export price. Zeroing thus inflates the margin of dumping for the product as a whole.

We understand the United States to argue that a prohibition of zeroing would amount to a requirement to compare “dumped” and “non-dumped” transactions at the aggregation stage. The United States contends that results of multiple comparisons in which the weighted average normal value exceeds the weighted average export price may be excluded because they do not involve “dumping”. As we have stated earlier, the terms “dumping” and “margins of dumping” in Article VI of the GATT 1994 and the Anti-Dumping Agreement apply to the product under investigation as a whole and do not apply to sub-group levels. The treatment of comparisons for which the weighted average normal value is less than the weighted average export price as “non-dumped” comparisons is therefore not in accordance with the requirements of Article 2.4.2 of the Anti-Dumping Agreement.

For all these reasons, we do not agree with the United States that the results of comparisons at the sub-group level constitute margins of dumping. Nor do we agree with the United States that the results of the comparisons in which the weighted average normal value is less than the weighted average export price could be excluded in calculating a margin of dumping for the product under investigation as a whole.

We recall that the issue of whether zeroing is permitted under the transaction-to-transaction methodology or the average-to-individual methodology is not before us in this appeal. …

 
A.3.15 Article 3.1 — general     back to top

A.3.15.1 Thailand — H-Beams, para. 106
(WT/DS122/AB/R)

Article 3 as a whole deals with obligations of Members with respect to the determination of injury. Article 3.1 is an overarching provision that sets forth a Member’s fundamental, substantive obligation in this respect. Article 3.1 informs the more detailed obligations in succeeding paragraphs. These obligations concern the determination of the volume of dumped imports, and their effect on prices (Article 3.2), investigations of imports from more than one country (Article 3.3), the impact of dumped imports on the domestic industry (Article 3.4), causality between dumped imports and injury (Article 3.5), the assessment of the domestic production of the like product (Article 3.6), and the determination of the threat of material injury (Articles 3.7 and 3.8). The focus of Article 3 is thus on substantive obligations that a Member must fulfill in making an injury determination.

 
A.3.15A Footnote 9 to Article 3     back to top

A.3.15A.1 US — Oil Country Tubular Goods Sunset Reviews, para. 276
(WT/DS268/AB/R)

… we would agree with Argentina that, by virtue of its opening phrase, footnote 9 defines “injury” for the whole of the Anti-Dumping Agreement. … Therefore, when Article 11.3 requires a determination as to the likelihood of continuation or recurrence of “injury”, the investigating authority must consider the continuation or recurrence of “injury” as defined in footnote 9.

 
A.3.16 Article 3.1 — “positive evidence”     back to top

A.3.16.1 Thailand — H-Beams, para. 107
(WT/DS122/AB/R)

… the ordinary meaning of [the terms of Article 3.1] does not suggest that an investigating authority is required to base an injury determination only upon evidence disclosed to, or discernible by, the parties to the investigation. An anti-dumping investigation involves the commercial behaviour of firms, and, under the provisions of the Anti-Dumping Agreement, involves the collection and assessment of both confidential and non-confidential information. An injury determination conducted pursuant to the provisions of Article 3 of the Anti-Dumping Agreement must be based on the totality of that evidence. We see nothing in Article 3.1 which limits an investigating authority to base an injury determination only upon non-confidential information.

A.3.16.2 Thailand — H-Beams, para. 111
(WT/DS122/AB/R)

We consider, therefore, that the requirement in Article 3.1 that an injury determination be based on “positive” evidence and involve an “objective” examination of the required elements of injury does not imply that the determination must be based only on reasoning or facts that were disclosed to, or discernible by, the parties to an anti-dumping investigation. Article 3.1, on the contrary, permits an investigating authority making an injury determination to base its determination on all relevant reasoning and facts before it.

A.3.16.3 US — Hot-Rolled Steel, para. 192
(WT/DS184/AB/R)

… The thrust of the investigating authorities’ obligation, in Article 3.1, lies in the requirement that they base their determination on “positive evidence” and conduct an “objective examination”. The term “positive evidence” relates, in our view, to the quality of the evidence that authorities may rely upon in making a determination. The word “positive” means, to us, that the evidence must be of an affirmative, objective and verifiable character, and that it must be credible.

 
A.3.17 Article 3.1 — “objective examination”     back to top

A.3.17.1 US — Hot-Rolled Steel, para. 193
(WT/DS184/AB/R)

The term “objective examination” aims at a different aspect of the investigating authorities’ determination. While the term “positive evidence” focuses on the facts underpinning and justifying the injury determination, the term “objective examination” is concerned with the investigative process itself. The word “examination” relates, in our view, to the way in which the evidence is gathered, inquired into and, subsequently, evaluated; that is, it relates to the conduct of the investigation generally. The word “objective”, which qualifies the word “examination”, indicates essentially that the “examination” process must conform to the dictates of the basic principles of good faith and fundamental fairness. In short, an “objective examination” requires that the domestic industry, and the effects of dumped imports, be investigated in an unbiased manner, without favouring the interests of any interested party, or group of interested parties, in the investigation. The duty of the investigating authorities to conduct an “objective examination” recognizes that the determination will be influenced by the objectivity, or any lack thereof, of the investigative process.

A.3.17.2 US — Hot-Rolled Steel, para. 196
(WT/DS184/AB/R)

However, the investigating authorities’ evaluation of the relevant factors must respect the fundamental obligation, in Article 3.1, of those authorities to conduct an “objective examination”. If an examination is to be “objective”, the identification, investigation and evaluation of the relevant factors must be even-handed. Thus, investigating authorities are not entitled to conduct their investigation in such a way that it becomes more likely that, as a result of the fact-finding or evaluation process, they will determine that the domestic industry is injured.

A.3.17.3 US — Hot-Rolled Steel, paras. 204-205
(WT/DS184/AB/R)

We have already stated that it may be highly pertinent for investigating authorities to examine a domestic industry by part, sector or segment. However, as with all other aspects of the evaluation of the domestic industry, Article 3.1 of the Anti-Dumping Agreement requires that such a sectoral examination be conducted in an “objective” manner. In our view, this requirement means that, where investigating authorities undertake an examination of one part of a domestic industry, they should, in principle, examine, in like manner, all of the other parts that make up the industry, as well as examine the industry as a whole. Or, in the alternative, the investigating authorities should provide a satisfactory explanation as to why it is not necessary to examine directly or specifically the other parts of the domestic industry. Different parts of an industry may exhibit quite different economic performance during any given period. …

Moreover, by examining only one part of an industry, the investigating authorities may fail properly to appreciate the economic relationship between that part of the industry and the other parts of the industry, or between one or more of those parts and the whole industry. …

A.3.17.4 US — Hot-Rolled Steel, para. 206
(WT/DS184/AB/R)

Accordingly, an examination of only certain parts of a domestic industry does not ensure a proper evaluation of the state of the domestic industry as a whole, and does not, therefore, satisfy the requirements of “objectiv[ity]” in Article 3.1 of the Anti-Dumping Agreement.

 
A.3.18 Articles 3.1 and 3.2 — Method of calculating the “volume of the dumped imports”     back to top

A.3.18.1 EC — Bed Linen (Article 21.5 — India), para. 113
(WT/DS141/AB/RW)

Although paragraphs 1 and 2 of Article 3 do not set out a specific methodology that investigating authorities are required to follow when calculating the volume of “dumped imports”, this does not mean that paragraphs 1 and 2 of Article 3 confer unfettered discretion on investigating authorities to pick and choose whatever methodology they see fit for determining the volume and effects of the dumped imports. Paragraphs 1 and 2 of Article 3 require investigating authorities to make a determination of injury on the basis of “positive evidence” and to ensure that the injury determination results from an “objective examination” of the volume of dumped imports, the effects of the dumped imports on prices, and, ultimately, the state of the domestic industry. Thus, whatever methodology investigating authorities choose for determining the volume of dumped imports, if that methodology fails to ensure that a determination of injury is made on the basis of “positive evidence” and involves an “objective examination” of dumped imports — rather than imports that are found not to be dumped — it is not consistent with paragraphs 1 and 2 of Article 3.

A.3.18.2 EC — Bed Linen (Article 21.5 — India), para. 117
(WT/DS141/AB/RW)

Thus, there is a right to conduct a limited examination in the circumstances described in the second sentence of Article 6.10. Paragraphs 1 and 2 of Article 3 must, accordingly, be interpreted in a way that permits investigating authorities to satisfy the requirements of “positive evidence” and an “objective examination” without having to investigate each producer or exporter individually. This does not, however, in any way, absolve investigating authorities from the absolute requirements in paragraphs 1 and 2 of Article 3 that the volume of dumped imports be determined on the basis of “positive evidence” and an “objective examination”.

A.3.18.3 EC — Bed Linen (Article 21.5 — India), para. 118
(WT/DS141/AB/RW)

… Still, whatever methodology investigating authorities choose for calculating the volume of “dumped imports”, that calculation and, ultimately, the determination of injury under Article 3, clearly must be made on the basis of “positive evidence” and involve an “objective examination”. …

 
A.3.19 Articles 3.1 and 3.2 — Calculation of the “volume of the dumped imports” without examining each producer or exporter individually.
See also Anti-Dumping Agreement, Article 2.1 (A.3.3-8); Anti-Dumping Agreement, Article 3.3 (A.3.21); Anti-Dumping Agreement, Article 6.10 (A.3.37); Anti-Dumping Agreement, Article 9.4 (A.3.41-44)     back to top

A.3.19.1 EC — Bed Linen (Article 21.5 — India), para. 130
(WT/DS141/AB/RW)

In this dispute, we agree with the participants that the evidence on dumping margins established for the producers that were examined individually is “positive” in the sense that we defined it in US — Hot-Rolled Steel,… We also agree … that evidence on dumping margins of more than de minimis for examined producers is relevant as “positive evidence” in this investigation for determining which import volumes may be attributed to non-examined producers that are dumping. In our view, both these qualities of evidence are probative of the existence of dumping in the circumstances of this investigation. Therefore, we conclude that the European Communities met the first requirement of paragraphs 1 and 2 of Article 3 by basing its determination on that “positive evidence”.

A.3.19.2 EC — Bed Linen (Article 21.5 — India), para. 132
(WT/DS141/AB/RW)

… The approach taken by the European Communities in determining the volume of dumped imports was not based on an “objective examination”. The examination was not “objective” because its result is predetermined by the methodology itself. Under the approach used by the European Communities, whenever the investigating authorities decide to limit the examination to some, but not all, producers — as they are entitled to do under Article 6.10 — all imports from all non-examined producers will necessarily always be included in the volume of dumped imports under Article 3, as long as any of the producers examined individually were found to be dumping. … Moreover, such an approach tends to favour methodologies where small numbers of producers are examined individually. …

A.3.19.3 EC — Bed Linen (Article 21.5 — India), para. 133
(WT/DS141/AB/RW)

For these reasons, we conclude that the European Communities’ determination that all imports attributable to non-examined producers were dumped — even though the evidence from examined producers showed that producers accounting for 53 percent of imports attributed to examined producers were not dumping — did not lead to a result that was unbiased, even-handed, and fair. Therefore, the European Communities did not satisfy the requirements of paragraphs 1 and 2 of Article 3…

A.3.19.4 EC — Bed Linen (Article 21.5 — India), para. 137
(WT/DS141/AB/RW)

… Article 6.10 … does not stipulate that investigating authorities must follow a specific methodology when determining the volume of dumped imports under paragraphs 1 and 2 of Article 3. However, this does not mean that evidence emerging from the determination of margins of dumping for individual producers or exporters pursuant to Article 6.10 is irrelevant for the determination of the volume of dumped imports in paragraphs 1 and 2 of Article 3. To the contrary, such evidence may well form part of the “positive evidence” on which an “objective examination” of the volume of dumped imports for purposes of determining injury may be based. Indeed, in cases where the examination has been limited to a select number of producers under the authority of the second sentence of Article 6.10, it is difficult to conceive of a determination based on “positive evidence” and an “objective examination” that is made other than through some form of extrapolation of the evidence. …

A.3.19.5 EC — Bed Linen (Article 21.5 — India), para. 138
(WT/DS141/AB/RW)

India’s suggestion that the investigating authorities should consider the same proportion of import volumes attributable to non-examined producers as dumped, as the proportion of import volumes attributed to examined producers that were found to be dumping, may be one way of adducing “positive evidence” from the record of an investigation and of conducting an “objective examination”, especially if producers selected for individual examination constitute a statistically valid sample representative of all producers. Even if the producers selected for individual examination account, instead, for the largest percentage of exports that could reasonably be investigated, we do not exclude the possibility that the evidence from those examined producers could, nonetheless, qualify as part of the “positive evidence” that might serve as a basis for an “objective examination” of import volumes that can be attributed to the remaining non-examined producers. There may, indeed, be other ways of making these calculations that satisfy the requirements of paragraphs 1 and 2 of Article 3.

A.3.19.6 EC — Bed Linen (Article 21.5 — India), para. 146
(WT/DS141/AB/RW)

… we agree with the Panel “that the [Anti-Dumping] Agreement does not require an investigating authority to determine the volume of imports from producers outside the sample that is properly considered ‘dumped imports’ for purposes of injury analysis on the basis of the proportion of imports from sampled producers that is found to be dumped” according to the specific methodology suggested by India in this appeal. …

 
A.3.20 Article 3.2 — No country-specific analysis of volume and prices of dumped imports     back to top

A.3.20.1 EC — Tube or Pipe, para. 111 and footnote 114
(WT/DS219/AB/R)

… There is no indication in the text of Article 3.2 that the analyses of volume and prices must be performed on a country-by-country basis where an investigation involves imports from several countries.114

A.3.20.2 EC — Tube or Pipe, para. 113
(WT/DS219/AB/R)

We also believe that cumulation without a country-specific analysis does not result in a “derog[ation]” of Article 3.2, as Brazil has asserted. We wish to emphasize that Article 3.2 plays a central role in the determination of injury and is a necessary step in any anti-dumping investigation. As the Panel correctly observed, it is possible for the analyses of volume and prices envisaged under Article 3.2 to be done on a cumulative basis, as opposed to an individual country basis, when dumped imports originate from more than one country.

 
A.3.21 Article 3.3 — Cumulative assessment of dumped imports.
See also Anti-Dumping Agreement, Article 3.2 (A.3.20)     back to top

A.3.21.1 EC — Bed Linen (Article 21.5 — India), para. 145
(WT/DS141/AB/RW)

… The provisions regarding the cumulative assessment of imports pursuant to Article 3.3 must be interpreted consistently with the provisions of the Anti-Dumping Agreement that deal with the determinations of dumping margins or the application of anti-dumping duties with respect to specific producers or groups thereof. Similarly, the right under Article 3.3 to conduct anti-dumping investigations with respect to imports from different exporting countries does not absolve investigating authorities from the requirements of paragraphs 1 and 2 of Article 3 to determine the volume of dumped imports on the basis of “positive evidence” and an “objective examination”.

A.3.21.2 EC — Tube or Pipe, para. 110
(WT/DS219/AB/R)

We find no basis in the text of Article 3.3 for Brazil’s assertion that a country-specific analysis of the potential negative effects of volumes and prices of dumped imports is a pre-condition for a cumulative assessment of the effects of all dumped imports. Article 3.3 sets out expressly the conditions that must be fulfilled before the investigating authorities may cumulatively assess the effects of dumped imports from more than one country. There is no reference to the country-by-country volume and price analyses that Brazil contends are pre-conditions to cumulation. In fact, Article 3.3 expressly requires an investigating authority to examine country-specific volumes, not in the manner suggested by Brazil, but for purposes of determining whether the “volume of imports from each country is not negligible”.

A.3.21.3 EC — Tube or Pipe, para. 115
(WT/DS219/AB/R)

… Therefore, the text of Article 3 does not support Brazil’s contention that volume and prices are deemed exclusively to be “factors”, and not “effects”, for the purposes of Article 3.3 of the Anti-Dumping Agreement.

A.3.21.4 EC — Tube or Pipe, para. 116
(WT/DS219/AB/R)

The apparent rationale behind the practice of cumulation confirms our interpretation that both volume and prices qualify as “effects” that may be cumulatively assessed under Article 3.3. A cumulative analysis logically is premised on a recognition that the domestic industry faces the impact of the “dumped imports” as a whole and that it may be injured by the total impact of the dumped imports, even though those imports originate from various countries. If, for example, the dumped imports from some countries are low in volume or are declining, an exclusively country-specific analysis may not identify the causal relationship between the dumped imports from those countries and the injury suffered by the domestic industry. The outcome may then be that, because imports from such countries could not individually be identified as causing injury, the dumped imports from these countries would not be subject to anti-dumping duties, even though they are in fact causing injury. In our view, therefore, by expressly providing for cumulation in Article 3.3 of the Anti-Dumping Agreement, the negotiators appear to have recognized that a domestic industry confronted with dumped imports originating from several countries may be injured by the cumulated effects of those imports, and that those effects may not be adequately taken into account in a country-specific analysis of the injurious effects of dumped imports. Consistent with the rationale behind cumulation, we consider that changes in import volumes from individual countries, and the effect of those country-specific volumes on prices in the importing country’s market, are of little significance in determining whether injury is being caused to the domestic industry by the dumped imports as a whole.

A.3.21.5 US — Oil Country Tubular Goods Sunset Reviews, para. 300
(WT/DS268/AB/R)

Given the express intention of Members to permit cumulation in injury determinations in original investigations, and given the rationale behind cumulation in injury determinations, we do not read the Anti-Dumping Agreement as prohibiting cumulation in sunset reviews.

 
A.3.22 Article 3.4 — Evaluation of injury factors     back to top

A.3.22.1 Thailand — H-Beams, para. 125
(WT/DS122/AB/R)

… The Panel also examined, with respect to this issue, the interpretation by a previous panel of Article 3.4, and an earlier interpretation given by us of an analogous provision, Article 4.2(a) of the Agreement on Safeguards. The Panel concluded its comprehensive analysis by stating that “each of the fifteen individual factors listed in the mandatory list of factors in Article 3.4 must be evaluated by the investigating authorities…”. We agree with the Panel’s analysis in its entirety, and with the Panel’s interpretation of the mandatory nature of the factors mentioned in Article 3.4 of the Anti-Dumping Agreement.

A.3.22.2 Thailand — H-Beams, paras. 127-128
(WT/DS122/AB/R)

… Further, the Panel’s interpretation that Article 3.4 requires a mandatory evaluation of all the individual factors listed in that Article clearly left no room for a “permissible” interpretation that all individual factors need not be considered.

We conclude that the Panel was correct in its interpretation that Article 3.4 requires a mandatory evaluation of all of the factors listed in that provision, and that, therefore, the Panel did not err in its application of the standard of review under Article 17.6(ii) of the Anti-Dumping Agreement.

A.3.22.3 US — Hot-Rolled Steel, para. 195
(WT/DS184/AB/R)

We see nothing in the Anti-Dumping Agreement which prevents a Member from requiring that its investigating authorities examine, in every investigation, the potential relevance of a particular “other factor”, not listed in Article 3.4, as part of its overall “examination” of the state of the domestic industry. Similarly, it seems to us perfectly compatible with Article 3.4 for investigating authorities to undertake, or for a Member to require its investigating authorities to undertake, an evaluation of particular parts, sectors or segments within a domestic industry. Such a sectoral analysis may be highly pertinent, from an economic perspective, in assessing the state of an industry as a whole.

A.3.22.4 US — Hot-Rolled Steel, para. 196
(WT/DS184/AB/R)

However, the investigating authorities’ evaluation of the relevant factors must respect the fundamental obligation, in Article 3.1, of those authorities to conduct an “objective examination”. If an examination is to be “objective”, the identification, investigation and evaluation of the relevant factors must be even-handed. Thus, investigating authorities are not entitled to conduct their investigation in such a way that it becomes more likely that, as a result of the fact-finding or evaluation process, they will determine that the domestic industry is injured.

A.3.22.5 US — Hot-Rolled Steel, para. 198
(WT/DS184/AB/R)

… In our opinion, nothing in the Anti-Dumping Agreement prevents the United States from directing its investigating authorities to evaluate the potential relevance of the structure of a domestic industry, and, in particular, the importance to that industry, as a whole, of the fact that the production of certain domestic producers is captively consumed, while the production of other domestic producers competes directly with imports in the merchant market. …

A.3.22.6 US — Hot-Rolled Steel, para. 206
(WT/DS184/AB/R)

Accordingly, an examination of only certain parts of a domestic industry does not ensure a proper evaluation of the state of the domestic industry as a whole, and does not, therefore, satisfy the requirements of “objectiv[ity]” in Article 3.1 of the Anti-Dumping Agreement.

A.3.22.7 EC — Tube or Pipe, para. 131
(WT/DS219/AB/R)

[Article 3.4 of the Anti-Dumping Agreement] requires an investigating authority to evaluate all relevant economic factors in its examination of the impact of the dumped imports. By its terms, it does not address the manner in which the results of this evaluation are to be set out, nor the type of evidence that may be produced before a panel for the purpose of demonstrating that this evaluation was indeed conducted. The provision simply requires Members to include an evaluation of all relevant economic factors in its examination of the impact of the dumped imports. …

A.3.22.8 EC — Tube or Pipe, para. 156
(WT/DS219/AB/R)

The participants in this appeal do not dispute that it is mandatory for investigating authorities to evaluate all of the fifteen injury factors listed in Article 3.4 of the Anti-Dumping Agreement. One of the fifteen factors expressly listed in Article 3.4 is the “actual and potential negative effects on … growth”. The issue raised by Brazil in this appeal is whether the requirements of Article 3.4 were satisfied in this case, even though the factor “growth” was evaluated only “implicitly” and no separate record of its evaluation was made.

A.3.22.9 EC — Tube or Pipe, para. 157
(WT/DS219/AB/R)

Looking first to the text of Article 3.4, we find that it calls for “an evaluation of all relevant economic factors and indices having a bearing on the state of the industry”. The text, however, does not address the manner in which the results of the investigating authority’s analysis of each injury factor are to be set out in the published documents.

 
A.3.23 Article 3.4 — Manner of evaluating injury factors     back to top

A.3.23.1 EC — Tube or Pipe, para. 160
(WT/DS219/AB/R)

… The obligation to evaluate all fifteen factors is distinct from the manner in which the evaluation is to be set out in the published documents. As the European Communities contends, that the analysis of a factor is implicit in the analyses of other factors does not necessarily lead to the conclusion that such a factor was not evaluated.

A.3.23.2 EC — Tube or Pipe, para. 161
(WT/DS219/AB/R)

Accordingly, because Articles 3.1 and 3.4 do not regulate the manner in which the results of the analysis of each injury factor are to be set out in the published documents, we share the Panel’s conclusion that it is not required that in every anti-dumping investigation a separate record be made of the evaluation of each of the injury factors listed in Article 3.4. Whether a panel conducting an assessment of an anti-dumping measure is able to find in the record sufficient and credible evidence to satisfy itself that a factor has been evaluated, even though a separate record of the evaluation of that factor has not been made, will depend on the particular facts of each case. …

A.3.23.3 EC — Tube or Pipe, para. 162
(WT/DS219/AB/R)

Having regard to the nature of the factor “growth”, we believe that an evaluation of that factor necessarily entails an analysis of certain other factors listed in Article 3.4. Consequently, the evaluation of those factors could cover also the evaluation of the factor “growth”. …

A.3.23.4 EC — Tube or Pipe, para. 165
(WT/DS219/AB/R)

… From our perspective, the “declines” and “losses” observed with respect to several of the factors examined in this particular case necessarily relate to the issue of “growth” as well. To put it more precisely, the negative trends in these factors point to a lack of “growth”. This, in turn, supports the conclusion that the European Commission evaluated this injury factor.

 
A.3.24 Article 3.5 — Non-attribution of injury caused by other known factors     back to top

A.3.24.1 US — Hot-Rolled Steel, para. 223
(WT/DS184/AB/R)

The non-attribution language in Article 3.5 of the Anti-Dumping Agreement applies solely in situations where dumped imports and other known factors are causing injury to the domestic industry at the same time. In order that investigating authorities, applying Article 3.5, are able to ensure that the injurious effects of the other known factors are not “attributed” to dumped imports, they must appropriately assess the injurious effects of those other factors. Logically, such an assessment must involve separating and distinguishing the injurious effects of the other factors from the injurious effects of the dumped imports. If the injurious effects of the dumped imports are not appropriately separated and distinguished from the injurious effects of the other factors, the authorities will be unable to conclude that the injury they ascribe to dumped imports is actually caused by those imports, rather than by the other factors. Thus, in the absence of such separation and distinction of the different injurious effects, the investigating authorities would have no rational basis to conclude that the dumped imports are indeed causing the injury which, under the Anti-Dumping Agreement, justifies the imposition of anti-dumping duties.

A.3.24.2 US — Hot-Rolled Steel, para. 224
(WT/DS184/AB/R)

We emphasize that the particular methods and approaches by which WTO Members choose to carry out the process of separating and distinguishing the injurious effects of dumped imports from the injurious effects of the other known causal factors are not prescribed by the Anti-Dumping Agreement. What the Agreement requires is simply that the obligations in Article 3.5 be respected when a determination of injury is made.

A.3.24.3 US — Hot-Rolled Steel, para. 226
(WT/DS184/AB/R)

It is clear to us that the interpretive approach adopted by the panel in United States — Atlantic Salmon Anti-Dumping Duties is at odds with the interpretive approach for Article 3.5 of the Anti-Dumping Agreement that we have just set forth. As we said, in order to comply with the non-attribution language in that provision, investigating authorities must make an appropriate assessment of the injury caused to the domestic industry by the other known factors, and they must separate and distinguish the injurious effects of the dumped imports from the injurious effects of those other factors. This requires a satisfactory explanation of the nature and extent of the injurious effects of the other factors, as distinguished from the injurious effects of the dumped imports. However, the panel in United States — Atlantic Salmon Anti-Dumping Duties, expressly disavowed any need to “identify” the injury caused by the other factors. According to that panel, such separate identification of the injurious effects of the other causal factors is not required.

A.3.24.4 US — Hot-Rolled Steel, para. 227
(WT/DS184/AB/R)

By following the panel in United States — Atlantic Salmon Anti-Dumping Duties, the Panel, in effect, took the view that the USITC was not required to separate and distinguish the injurious effects of the other factors from the injurious effects of dumped imports, and that the nature and extent of the injurious effects of the other known factors need not be identified at all. However, in our view, this is precisely what the non-attribution language in Article 3.5 of the Anti-Dumping Agreement requires, in order to ensure that determinations regarding dumped imports are not based on mere assumptions about the effects of those imports, as distinguished from the effects of the other factors.

A.3.24.5 US — Hot-Rolled Steel, para. 228
(WT/DS184/AB/R)

The United States contends that the panel in United States — Atlantic Salmon Anti-Dumping Duties correctly stated that there is no need to “isolate” the injurious effects of the other factors from the injurious effects of the dumped imports. We are not certain what the panel, in that dispute, intended to imply through the use of the word “isolation”. Nevertheless, we agree with the United States that the different causal factors operating on a domestic industry may interact, and their effects may well be inter-related, such that they produce a combined effect on the domestic industry. We recognize, therefore, that it may not be easy, as a practical matter, to separate and distinguish the injurious effects of different causal factors. However, although this process may not be easy, this is precisely what is envisaged by the non-attribution language. If the injurious effects of the dumped imports and the other known factors remain lumped together and indistinguishable, there is simply no means of knowing whether injury ascribed to dumped imports was, in reality, caused by other factors. Article 3.5, therefore, requires investigating authorities to undertake the process of assessing appropriately, and separating and distinguishing, the injurious effects of dumped imports from those of other known causal factors.

A.3.24.6 EC — Bed Linen (Article 21.5 — India), para. 112
(WT/DS141/AB/RW)

Article 3.5 continues in the same vein as the initial paragraphs of Article 3 by requiring a demonstration that dumped imports are causing injury to the domestic industry “through the effects of dumping”, which, of course, depends upon there being imports from producers or exporters that are dumped. In addition, Article 3.5 lists “volume and prices of imports not<