Dispute Settlement Body 17 February 2004

DSB adopts reports on softwood lumber from Canada

At its meeting on 17 February 2004, the Dispute Settlement Body adopted the Appellate Body and panel reports on Canada's complaint concerning the United States' final countervailing duty determination on certain softwood lumber from Canada (WT/DS257).

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This summary has been prepared by the WTO Secretariat’s Information and Media Relations Division to help public understanding about developments in WTO disputes. It is not a legal interpretation of the issues, and it is not intended as a complete account of the issues. These can be found in the reports themselves and in the minutes of the Dispute Settlement Body’s meetings.

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DS136 & DS162: United States — Anti-dumping Act of 1916

The United States announced that legislation repealing the 1916 Act had been favourably reported out of the Committee on the Judiciary of the US House of Representatives on 29 January 2004.

The European Communities noted the US' action but commented that the bill would not terminate the pending court cases.

Japan took note of the US' report but also regretted the lack of retroactive effect of the bill.

DS176: United States — Section 211 Omnibus Appropriations Act of 1998

The US said that it continued to work with US Congress to resolve this matter.

The EC noted that there were presently two bills pending in US Congress that would repeal Section 211. The EC added that these bills offered a basis to resolve this dispute to the benefit of all.

Cuba argued that the US' lack of implementation was a manoeuvre to take away Havana Club Holding's legitimate rights on the trademark Havana Club and to protect the interests of the Bacardi company.

DS184: United States — Anti-dumping measures on certain hot-rolled steel products from Japan

The US stated that the US Administration continued to work with the US Congress to address the recommendations and rulings of the DSB.

Japan said that the US should fully implement as soon as possible.

DS207: Chile — Price band system and safeguard measures relating to certain agricultural products

Chile reiterated that it had fully complied with the DSB recommendations.

Argentina said that it had a different point of view concerning Chile's implementation and that the two countries were working to find a solution to this dispute.

DS217 & DS234: United States — Continued dumping and subsidy offset act of 2000

The US reported that on 2 February 2004, the US Administration had proposed repeal of this Act in its budget proposal for fiscal year 2005, as it had done the previous year.

The EC welcomed the US President's calls for a repeal of the Byrd Amendment but mentioned that a similar proposal made last year had not resulted in any action in US Congress. The EC said that another round of illegal disbursements under the Byrd amendment would be unacceptable. The EC finally expressed hope that rapid implementation would make it unnecessary to suspend concession vis-à-vis the US.

Canada said that as a result of the non-compliance, Canada and seven other members of the WTO had been forced to seek authorization to retaliate against the US. Canada however added that it did not favour disruptions to trade and called again upon the US to repeal the Byrd Amendment.

Similarly, Chile, Japan, Korea and India noted the US' administration call for the amendment's repeal and urged the US to implement as soon as possible in order to avoid retaliation.


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Panel requests

DS294: United States — Laws, regulations and methodology for calculating dumping margins (“zeroing”)

The EC requested the establishement a panel to examine the calculation methodologies used by the US in establishing dumping margins. The EC recalled that in the “Bed linen“ (DS141), the reports had found that the EC methodology, known as “zeroing”, was WTO incompatible. The EC said that it had since then stopped the use of that methodology and that WTO rules should apply equally to every member.

The US responded that the US and the EC's methods were not identical and that it was confident that its method would be found to be consistent with US WTO obligations.

In accordance with the WTO dispute settlement rules, the US blocked this first panel request by the EC.

DS301: European Communities — Measures affecting trade in commercial vessels

In its first request, Korea asked for a panel to look at the EC's Temporary Defence Mechanism (TDM). Korea explained that this mechanism assisted EC shipyards that had allegedly suffered adverse effects caused by unfair Korean competition. Korea argued that the TDM constituted a unilateral determination of violation and a unilateral imposition of a punitive measure aimed solely at one Member, Korea.

The EC expressed surprise at Korea's panel request, arguing that consultations were still underway. The EC expressed even more surprise at Korea's new request for consultations (WT/DS307) dated 13 February 2004.

Korea explained that its new request for consultations had been prompted by the extension of the TDM which was originally meant to expire by the end of March 2004.

The US said that it would be following this dispute with the utmost interest.

The EC rejected Korea's first panel request.


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Adoption of report

DS257: United States — Final countervailing duty determination with respect to certain softwood lumber from Canada

The US said that it was pleased by the results of the panel and Appellate Body reports.

Canada said that, while disappointed in certain of the findings, it welcomed these reports.

The EC welcomed the clarifications provided by the Appellate body on some terms of the Subsidies and Countervailing Measures Agreement.

The DSB adopted the Appellate Body report and the panel report as modified by the Appellate Body.


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New chairperson

The meeting was suspended on this agenda item and will be reconvened at an appropriate time, in light of the outgoing Chairman's absence, Ambassador Shotaro Oshima of Japan.


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Other business

Mexico thanked Chile for the withdrawal of its request for consultations in the case “Mexico — Measures affecting the import of matches” (WT/DS232). Mexico expressed hope that a mutually acceptable solution would also be found in its disputes against Guatemala (WT/DS298) and Nicaragua (WT/DS284).


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Next meeting

The next regular meeting of the DSB will take place on 19 March 2004.

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