Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (Anti-Dumping Agreement)

back to top

VII. Article 6  

A. Text of Article 6

Article 6: Evidence

6.1   All interested parties in an anti-dumping investigation shall be given notice of the information which the authorities require and ample opportunity to present in writing all evidence which they consider relevant in respect of the investigation in question.

 

6.1.1    Exporters or foreign producers receiving questionnaires used in an anti-dumping investigation shall be given at least 30 days for reply.(15) Due consideration should be given to any request for an extension of the 30 day period and, upon cause shown, such an extension should be granted whenever practicable.

 

(footnote original) 15 As a general rule, the time-limit for exporters shall be counted from the date of receipt of the questionnaire, which for this purpose shall be deemed to have been received one week from the date on which it was sent to the respondent or transmitted to the appropriate diplomatic representative of the exporting Member or, in the case of a separate customs territory Member of the WTO, an official representative of the exporting territory.

 

6.1.2   Subject to the requirement to protect confidential information, evidence presented in writing by one interested party shall be made available promptly to other interested parties participating in the investigation.

 

6.1.3   As soon as an investigation has been initiated, the authorities shall provide the full text of the written application received under paragraph 1 of Article 5 to the known exporters(16) and to the authorities of the exporting Member and shall make it available, upon request, to other interested parties involved. Due regard shall be paid to the requirement for the protection of confidential information, as provided for in paragraph 5.

 

(footnote original) 16 It being understood that, where the number of exporters involved is particularly high, the full text of the written application should instead be provided only to the authorities of the exporting Member or to the relevant trade association.

 

6.2   Throughout the anti-dumping investigation all interested parties shall have a full opportunity for the defence of their interests. To this end, the authorities shall, on request, provide opportunities for all interested parties to meet those parties with adverse interests, so that opposing views may be presented and rebuttal arguments offered. Provision of such opportunities must take account of the need to preserve confidentiality and of the convenience to the parties. There shall be no obligation on any party to attend a meeting, and failure to do so shall not be prejudicial to that party’s case. Interested parties shall also have the right, on justification, to present other information orally.

 

6.3   Oral information provided under paragraph 2 shall be taken into account by the authorities only in so far as it is subsequently reproduced in writing and made available to other interested parties, as provided for in subparagraph 1.2.

 

6.4   The authorities shall whenever practicable provide timely opportunities for all interested parties to see all information that is relevant to the presentation of their cases, that is not confidential as defined in paragraph 5, and that is used by the authorities in an anti-dumping investigation, and to prepare presentations on the basis of this information.

 

6.5   Any information which is by nature confidential (for example, because its disclosure would be of significant competitive advantage to a competitor or because its disclosure would have a significantly adverse effect upon a person supplying the information or upon a person from whom that person acquired the information), or which is provided on a confidential basis by parties to an investigation shall, upon good cause shown, be treated as such by the authorities. Such information shall not be disclosed without specific permission of the party submitting it.(17)

 

(footnote original) 17 Members are aware that in the territory of certain Members disclosure pursuant to a narrowly-drawn protective order may be required.

 

6.5.1   The authorities shall require interested parties providing confidential information to furnish non confidential summaries thereof. These summaries shall be in sufficient detail to permit a reasonable understanding of the substance of the information submitted in confidence. In exceptional circumstances, such parties may indicate that such information is not susceptible of summary. In such exceptional circumstances, a statement of the reasons why summarization is not possible must be provided.

 

6.5.2   If the authorities find that a request for confidentiality is not warranted and if the supplier of the information is either unwilling to make the information public or to authorize its disclosure in generalized or summary form, the authorities may disregard such information unless it can be demonstrated to their satisfaction from appropriate sources that the information is correct.(18)

 

(footnote original) 18 Members agree that requests for confidentiality should not be arbitrarily rejected.

 

6.6   Except in circumstances provided for in paragraph 8, the authorities shall during the course of an investigation satisfy themselves as to the accuracy of the information supplied by interested parties upon which their findings are based.

 

6.7   In order to verify information provided or to obtain further details, the authorities may carry out investigations in the territory of other Members as required, provided they obtain the agreement of the firms concerned and notify the representatives of the government of the Member in question, and unless that Member objects to the investigation. The procedures described in Annex I shall apply to investigations carried out in the territory of other Members. Subject to the requirement to protect confidential information, the authorities shall make the results of any such investigations available, or shall provide disclosure thereof pursuant to paragraph 9, to the firms to which they pertain and may make such results available to the applicants.

 

6.8   In cases in which any interested party refuses access to, or otherwise does not provide, necessary information within a reasonable period or significantly impedes the investigation, preliminary and final determinations, affirmative or negative, may be made on the basis of the facts available. The provisions of Annex II shall be observed in the application of this paragraph.

 

6.9   The authorities shall, before a final determination is made, inform all interested parties of the essential facts under consideration which form the basis for the decision whether to apply definitive measures. Such disclosure should take place in sufficient time for the parties to defend their interests.

 

6.10   The authorities shall, as a rule, determine an individual margin of dumping for each known exporter or producer concerned of the product under investigation. In cases where the number of exporters, producers, importers or types of products involved is so large as to make such a determination impracticable, the authorities may limit their examination either to a reasonable number of interested parties or products by using samples which are statistically valid on the basis of information available to the authorities at the time of the selection, or to the largest percentage of the volume of the exports from the country in question which can reasonably be investigated.

 

6.10.1   Any selection of exporters, producers, importers or types of products made under this paragraph shall preferably be chosen in consultation with and with the consent of the exporters, producers or importers concerned.

 

6.10.2  In cases where the authorities have limited their examination, as provided for in this paragraph, they shall nevertheless determine an individual margin of dumping for any exporter or producer not initially selected who submits the necessary information in time for that information to be considered during the course of the investigation, except where the number of exporters or producers is so large that individual examinations would be unduly burdensome to the authorities and prevent the timely completion of the investigation. Voluntary responses shall not be discouraged.

 

6.11   For the purposes of this Agreement, “interested parties” shall include:

 

(i)   an exporter or foreign producer or the importer of a product subject to investigation, or a trade or business association a majority of the members of which are producers, exporters or importers of such product;

 

(ii)   the government of the exporting Member; and

 

(iii)   a producer of the like product in the importing Member or a trade and business association a majority of the members of which produce the like product in the territory of the importing Member.

 

This list shall not preclude Members from allowing domestic or foreign parties other than those mentioned above to be included as interested parties.

 

6.12   The authorities shall provide opportunities for industrial users of the product under investigation, and for representative consumer organizations in cases where the product is commonly sold at the retail level, to provide information which is relevant to the investigation regarding dumping, injury and causality.

 

6.13   The authorities shall take due account of any difficulties experienced by interested parties, in particular small companies, in supplying information requested, and shall provide any assistance practicable.

 

6.14   The procedures set out above are not intended to prevent the authorities of a Member from proceeding expeditiously with regard to initiating an investigation, reaching preliminary or final determinations, whether affirmative or negative, or from applying provisional or final measures, in accordance with relevant provisions of this Agreement.

B. Interpretation and Application of Article 6

1. Article 6.1

(a) General: due process rights

425.   The Appellate Body in US — Oil Country Tubular Goods Sunset Reviews held as follows regarding Articles 6.1 and 6.2:

“These provisions set out the fundamental due process rights to which interested parties are entitled in antidumping investigations and reviews. Articles 6.1 and 6.2 require that the opportunities afforded interested parties for presentation of evidence and defence of their interests be ‘ample’ and ‘full’, respectively. In the context of these provisions, these two adjectives suggest there should be liberal opportunities for respondents to defend their interests. Nevertheless, we agree with the United States that Articles 6.1 and 6.2 do not provide for ‘indefinite’ rights, so as to enable respondents to submit relevant evidence, attend hearings, or participate in the inquiry as and when they choose …”⁽⁵⁶⁰⁾

426.   The Panel in US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina) noted that while Articles 6.1 and 6.2 “set out the fundamental due process rights”, that did not mean that claims raised under those provisions could prevail without showing “the specific instances of violation” of those rights.⁽⁵⁶¹⁾

(b) “notice of the information which the authorities require”

427.   In Argentina — Ceramic Tiles, the Panel, when examining whether the investigating authorities were entitled to resort to facts available pursuant to Article 6.8, concluded that an investigating authority could not fault an interested party for not providing information it was not clearly requested to submit:

“Article 6.1 of the AD Agreement thus requires that interested parties be given notice of the information which the authorities require. In our view, it follows that, independently of the purpose for which the information or documentation is requested, an investigating authority may not fault an interested party for not providing information it was not clearly requested to submit.”⁽⁵⁶²⁾

(c) “ample opportunity to present … evidence”

428.   In Guatemala — Cement II, Mexico argued that Guatemala’s investigating authority had violated Article 6.1 by failing to set a time-limit for the presentation of arguments and evidence during the final stage of the investigation while it had fixed a time-limit for the submission of arguments and evidence for the early part of the investigation. The Panel rejected this argument:

“In our view, Article 6.1 of the AD Agreement does not require investigating authorities to set time-limits for the presentation of arguments and evidence during the final stage of the investigation. The only time-limit provided for in Article 6.1 is that contained in Article 6.1.1, whereby exporters shall be given at least 30 days for replying to questionnaires. …

 

Article 6.1 requires investigating authorities to provide interested parties ‘ample opportunity’ to present in writing certain evidence. Article 6.1 does not explicitly require an investigating authority to set time-limits for the submission of arguments and evidence during the final stage of an investigation.⁽⁵⁶³⁾ Article 6.1 simply requires that interested parties shall have ‘ample’ opportunity to present evidence and ‘full’ opportunity to defend their interests. Interested parties may have such opportunity without the investigating authority setting time-limits for the submission of evidence. In other words, these provisions impose substantive obligations, without requiring those obligations to be met through any particular form (except as provided for in sub-paragraphs 1 through 3 of Article 6.1). What counts is whether, in practice, sufficient opportunity was provided, not whether time limits for the submission of evidence were set. Thus, even if the Ministry had failed to set time-limits for the submission of arguments and evidence during the final stage of the investigation, this would not ipso facto constitute a violation of Article 6.1 of the AD Agreement.”⁽⁵⁶⁴⁾

429.   The Panel further rejected Mexico’s argument that “the Ministry’s public notice of initiation granted interested parties 30 days in which to defend their interests, whereas no such time-limit was included in the public notice concerning the imposition of a provisional measure”:⁽⁵⁶⁵⁾

“We would note that Article 12.1.1(vi) explicitly provides that a public notice of the initiation of an investigation shall include adequate information on the ‘time-limits allowed to interested parties for making their views known’. No such obligation is included in Article 12.2.1, concerning the contents of public notices on the imposition of provisional measures. We consider that Article 12.2.1 constitutes useful context when examining Mexico’s claim under Article 6.1. In particular, the fact that there is no requirement for investigating authorities to include time-limits for the submission of evidence in the public notice of their preliminary determinations confirms the conclusion set forth in the preceding paragraph.”⁽⁵⁶⁶⁾

430.   In EC — Fasteners (China), China brought a claim under Article 6.1.1 concerning the “MET/IT Claim Form” used by the EU to determine whether a respondent in a non-market economy can obtain “Market Economy Treatment” and/or “Individual Treatment”. The EU investigating authorities attached this form to a notification transmitted to Chinese exporters, with a response deadline of 15 days from the date of publication of the notice of initiation of the investigation. The Panel and the Appellate Body both rejected China’s claim because they determined that the form at issue was not a “questionnaire” in the sense of Article 6.1.1 (see paragraphs 439–440 below). However, the Appellate Body opined:

“We recall that Article 6.1 of the Anti-Dumping Agreement requires investigating authorities to give all interested parties ‘ample opportunity’ to submit evidence that they consider relevant to the investigation, and that this obligation applies also to information requests that cannot be considered ‘questionnaires’. In our view, the determinations made regarding MET and IT treatment are important for NME exporters and foreign producers. The MET/IT Claim Form was the first request for information received by the Chinese exporters in the fasteners investigation, and their responses were subject to verification. While much of the information requested would seem to be readily accessible to the responding party, the form requests certain production and sales data for ‘the product concerned’ that may need to be collected and reported in a form that is not regularly kept by the company, and could therefore involve a certain amount of time and effort for completion. Given the consequences of MET/IT status for exporters and foreign producers, and the amount of information solicited in the MET/IT Claim Form, we consider that, under the requirements of Article 6.1, a deadline of 15 days from the date of publication of the Notice of Initiation was too short and did not provide parties with ‘ample opportunity’ to submit all evidence in support of their requests for MET or IT treatment. However, China has not invoked Article 6.1 in this case.…”⁽⁵⁶⁷⁾

(d) Scope of Article 6.1

431.   In Guatemala — Cement II, Mexico argued that because Guatemala’s authority extended the period of investigation during the investigation procedure, and did not respond to requests for information from a Mexican producer concerning the extension, the Mexican producer was unable to defend its interests in respect of the extension of the period of investigation contrary to Articles 6.1 and 6.2. The Panel rejected this argument, stating:

“[W]e consider that Mexico’s interpretation of that provision is too expansive. The plain language of Article 6.1 merely requires that interested parties be given (1) notice of the information which the authorities require, and (2) ample opportunity to present in writing all evidence which they consider relevant in respect of the investigation. First, we note that Cruz Azul [the Mexican producer] was given two weeks in which to present data concerning the extended POI. Cruz Azul therefore had two weeks’ notice of the information required by the Ministry in respect of the extended POI.⁽⁵⁶⁸⁾ Second, Mexico has made no claim to the effect that Cruz Azul was prevented from adducing written ‘evidence’ concerning the extended POI. Whereas Mexico claims that Cruz Azul was denied any opportunity to comment on the extension of the POI per se, Article 6.1 does not explicitly require the provision of opportunities for interested parties to comment on decisions taken by the investigating authority in respect of the information it requires.”⁽⁵⁶⁹⁾

432.   In Guatemala — Cement II, the Panel examined Mexico’s argument that Guatemala’s authority acted inconsistently with Articles 6.1, 6.2 and 6.4 by failing to allow a Mexican producer “proper access” to the information submitted by a Guatemalan domestic producer at the public hearing it held. Noting that it had found a violation of Articles 6.1.2 and 6.4 on the same factual foundation, as referenced in paragraphs 449–450 below, the Panel stated:

“Since we consider [Articles 6.1.2 and 6.4] to be the specific provisions of the AD Agreement governing an interested party’s right to information submitted by another interested party, we do not consider it necessary to address Mexico’s claims under Articles 6.1 and 6.2. These provisions do not specifically address an interested party’s right of access to information submitted by another interested party.”⁽⁵⁷⁰⁾

433.   In Guatemala — Cement II, the Panel rejected Mexico’s claim that Guatemala’s authority had acted inconsistently with Articles 6.1, 6.2 and 6.9 by changing its injury determination from a preliminary determination of threat of material injury to a final determination of actual material injury during the course of the investigation, without informing a Mexican producer of that change, and without giving the producer a full and ample opportunity to defend itself. Referring to Article 12.2, the Panel first made the following general observation:

“We do not consider that an investigating authority need inform interested parties in advance when, having issued a preliminary affirmative determination on the basis of threat of material injury, it subsequently makes a final determination of actual material injury. No provision of the AD Agreement requires an investigating authority to inform interested parties, during the course of the investigation, that it has changed the legal basis for its injury determination. Investigating authorities are instead required to forward to interested parties a public notice, or a separate report, setting forth ‘in sufficient detail the findings and conclusions reached on all issues of fact and law considered material by the investigating authorities’, consistent with Article 12.2 of the AD Agreement. If decisions on issues of law had to be disclosed to interested parties during the course of the investigation, there would be little need for interested parties to receive the notice provided for in Article 12.2. Furthermore, to the extent that there is any difference between the preliminary determination of injury and the final determination of injury, that change will be apparent to interested parties comparing the public notice of the investigating authority’s preliminary determination with the public notice of its final determination.”⁽⁵⁷¹⁾

434.   The Panel in Guatemala — Cement II then went on to draw a distinction, in regard to Article 6.1, between “information”, “evidence” and “essential facts” on the one hand and “legal determinations” on the other:

“We note that Articles 6.1 and 6.9 impose certain obligations on investigating authorities in respect of ‘information’, ‘evidence’ and ‘essential facts’. However, Mexico’s claim does not concern interested parties’ right to have access to certain factual information during the course of an investigation. Mexico’s claim concerns interested parties’ alleged right to be informed of an investigating authority’s legal determinations during the course of an investigation.”⁽⁵⁷²⁾

435.   The Panel in US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina) did not consider that a “failure to issue supplemental questionnaires or a preliminary determination” would necessarily constitute a violation of Article 6.1 or Article 6.2 given that those Articles did not contain “such specific obligations”:⁽⁵⁷³⁾

“We are cognizant that issuing supplemental questionnaires or deficiency letters and/or a preliminary determination may be the common practice of some WTO Members, and may be highly commendable. The fact remains, however, that neither Article 6.1 nor 6.2 requires that an investigating authority do so. Nor can a mere allegation regarding the failure to establish a schedule that would allow interested parties to submit comments violate these provisions. Argentina has not explained with sufficient clarity how the timetable applied by the USDOC violated Article 6.1 or 6.2.”⁽⁵⁷⁴⁾

436.   The Appellate Body in Mexico — Anti-Dumping Measures on Rice examined the text of Articles 12.1 and 6.1, as well as context provided to Article 6.1 in Article 6.1.3, which all refer to interested parties “known” to the investigating authority. Based on this language, the Appellate Body concluded that the notification requirements therein apply only to interested parties for which the investigating authority had “actual knowledge,”⁽⁵⁷⁵⁾ and do not cover those for which the authority merely could have obtained knowledge.⁽⁵⁷⁶⁾ The Appellate Body reversed the Panel’s findings that, with respect to the exporters that Economía did not investigate, Mexico acted inconsistently with Articles 6.1 and 12.1 because Economía sent questionnaires to all companies of which it had actual knowledge and thus did not violate Articles 12.1 or 6.1.

(e) Article 6.1.1

(i) “questionnaires”: Scope of Article 6.1.1

437.   In Egypt — Steel Rebar, the Panel addressed the question of whether “questionnaires” as referred to in Article 6.1.1 are only the original questionnaires in an investigation, or whether this term would also include all other requests for information, or certain types of requests, including follow-up requests or supplemental requests.⁽⁵⁷⁷⁾ The Panel noted that the term “questionnaire” is not defined anywhere in the Agreement, and considered that Article 6.1.1 refers only to the original questionnaires sent to interested parties at the outset of an investigation:

“The term ‘questionnaire’ as used in Article 6.1.1 is not defined in the AD Agreement, and in fact, this term only appears in Article 6.1.1, and in paragraphs 6 and 7 of Annex I. In our view, the references in Annex I, paragraphs 6 and 7 provide strong contextual support for interpreting the term ‘questionnaires’ in Article 6.1.1 as referring only to the original questionnaires sent to interested parties at the outset of an investigation. In particular, both of these provisions refer to ‘the questionnaire’ in the singular, implying that there is only one document that constitutes a ‘questionnaire’ in a dumping investigation, namely the initial questionnaire, at least as far as the foreign companies (producers and exporters) that might be visited are concerned. Paragraph 6 refers to visits by an investigating authority to the territory of an exporting Member ‘to explain the questionnaire’. Paragraph 7 provides that ‘on-the-spot investigation … should be carried out after the response to the questionnaire has been received…’

 

If any requests for information other than the initial questionnaire were to be considered ‘questionnaires’ in the sense of Article 6.1.1, a number of operational and logistical problems would arise in respect of other obligations under the AD Agreement. First, there is no basis in the AD Agreement on which to determine that some, but not all, information requests other than the initial questionnaire also would constitute ‘questionnaires’. Thus, even if an investigating authority was not obligated to provide the minimum time-period in Article 6.1.1 in respect of every request for information, it would not be able to determine from the Agreement which of its requests were and were not subject to that time-period. On the other hand, if all requests for information in an investigation were ‘questionnaires’ in the sense of Article 6.1.1, this could make it impossible for an investigation to be completed within the maximum one year (or exceptionally, 18 months) allowed by the AD Agreement in Article 5.10. Moreover, a 30- or 37-day deadline for requests for information made in the context of an on-the-spot verification — i.e., the ‘obtain[ing of] further details’ explicitly referred to in Article 6.7 to as one of the purposes of such verifications — obviously would be completely illogical as well as unworkable. Finally, such an interpretation would render superfluous the requirement in Annex II, paragraph 6 to allow a ‘reasonable period …’ for the provision of any explanations concerning identified deficiencies in submitted information.”⁽⁵⁷⁸⁾

438.   In Mexico — Anti-Dumping Measures on Rice, the Appellate Body found:

“[T]he due process rights in Article 6 of the Anti-Dumping Agreement — which include the right to 30 days for reply to a questionnaire — ’cannot extend indefinitely’ but, instead, are limited by the investigating authority’s need ‘to “control the conduct” of its inquiry and to “carry out the multiple steps” required to reach a timely completion’ of the proceeding. As such, the time-limits for completing an investigation serve to circumscribe the obligation in Article 6.1.1 to provide all interested parties 30 days to reply to a questionnaire.”⁽⁵⁷⁹⁾

439.   In EC — Fasteners (China), China argued that the European Union acted inconsistently with Article 6.1.1 in relation to the “MET/IT Claim Form” used to determine whether a respondent in a non-market economy can obtain “Market Economy Treatment” and/or “Individual Treatment”. The investigating authorities attached this form to a notification transmitted to Chinese exporters, with a response deadline of 15 days from the date of publication of the notice of initiation of the investigation. The Appellate Body agreed with the Panel that the 30-day period stipulated in Article 6.1.1 applies only to “questionnaires”, which the Appellate Body defined as “a particular type of document containing substantial requests for information, distributed early in an investigation, and through which the investigating authority solicits a substantial amount of information relating to the key aspects of the investigation that is to be conducted by the authority (that is, dumping, injury, and causation)”:⁽⁵⁸⁰⁾

“The interpretation of Article 6.1.1 requires that the provision be read in its proper context, in particular Article 6.1 …

 

… Domestic producers can control the timing of the submission of a request for initiation of an anti-dumping investigation because it is their complaint that triggers the authority’s investigative process. The complaining producers therefore have an opportunity to gather much of the evidence necessary to support their complaint in advance. The responding parties, on the other hand, typically receive no notice until the initiation of the investigation. Article 6.1.1 protects exporters and foreign producers by requiring investigating authorities to provide them with at least 30 days to reply to ‘questionnaires’, and by allowing that extensions should be granted whenever practicable, upon cause shown. This indicates to us that the specific due process interest of exporters and foreign producers to be afforded an ample opportunity to respond has been expressly provided for.⁽⁵⁸¹⁾

 

The proper interpretation of Article 6.1.1 must also take into consideration the interests of investigating authorities in controlling their investigative process and bringing investigations to a close within a stipulated period of time. Article 5.10 of the Anti-Dumping Agreement requires that investigations be completed within 12 months or, in special circumstances, no more than 18 months. In this vein, Article 6.14 of the Anti-Dumping Agreement states that none of the procedures set out under Article 6 is intended ‘to prevent the authorities of a Member from proceeding expeditiously’ in reaching their determinations… .

 

…while Article 6.1.1 captures a specific due process concern as indicated above, the ‘questionnaires’ referred to in that Article do not refer to every request for information made by an investigating authority to exporters or foreign producers. Rather, the ‘questionnaires’ must be substantial requests, distributed early in the investigation, when a 30-day timeframe for the response would not lead to a delay in the completion of the investigation. They afford the investigating authority an early opportunity to solicit relevant information from exporters and foreign producers on key aspects of the investigation that is to be conducted by the authority.

 

Based on these considerations, we conclude that the meaning and scope of the term ‘questionnaires’ in Article 6.1.1 of the Anti-Dumping Agreement, and its application to specific kinds of documents, must reflect a balance between the due process requirement to provide parties with an ‘ample opportunity’ to submit all information they consider responsive to a questionnaire request in an antidumping investigation, and the overall timeframe imposed on the investigation under Article 5.10, along with the need for authorities to proceed expeditiously as contemplated in Article 6.14. We therefore find that the ‘questionnaires’ referred to in Article 6.1.1 are a particular type of document containing substantial requests for information, distributed early in an investigation, and through which the investigating authority solicits a substantial amount of information relating to the key aspects of the investigation that is to be conducted by the authority (that is, dumping, injury, and causation). While in many investigations one ‘questionnaire’ may be employed to solicit such information on these aspects of the investigation, we consider that, depending on how different Members organize the conduct of the investigation process, a party may receive several substantial requests soliciting such comprehensive information that are ‘questionnaires’ within the meaning of Article 6.1.1.”⁽⁵⁸²⁾

440.   The Appellate Body then agreed with the Panel that the MET/IT Claim Form was not a “questionnaire” within the meaning of Article 6.1.1 because it was not “an information request soliciting from the Chinese exporters and producers a substantial amount of information upon which the Commission would base its determinations regarding the key aspects of an antidumping investigation.”⁽⁵⁸³⁾ The Appellate Body then opined that if China had invoked Article 6.1, it would have found that the 15-day deadline was inconsistent with Article 6.1; see under Article 6.1 above.⁽⁵⁸⁴⁾

(ii) Failure to issue a questionnaire

441.   The Panel in Argentina — Poultry Anti-Dumping Duties considered that Article 6.1.1 does not address whether an injury questionnaire must be sent to exporters. According to the Panel, the first sentence of Article 6.1.1 means “that if questionnaires are sent to exporters or foreign producers, they shall be given at least 30 days for reply … the failure to send a particular questionnaire to exporters or foreign producers does not constitute a violation of Article 6.1.1.”⁽⁵⁸⁵⁾

(iii) Deadlines

442.   In US — Hot-Rolled Steel, the United States’ authorities had rejected certain information provided by two Japanese exporters which was submitted beyond the deadlines for responses to the questionnaires and thus applied “facts available” in the calculation of the dumping margins. The United States interpreted Article 6.8⁽⁵⁸⁶⁾ as permitting investigating authorities to rely upon reasonable, pre-established deadlines for the submission of data and argued that such an interpretation is supported by Article 6.1.1. The Appellate Body agreed with the Panel that “in the interest of orderly administration investigating authorities do, and indeed must establish such deadlines”.⁽⁵⁸⁷⁾ It further considered that those deadlines are “not necessarily absolute and immutable”:

“We observe that Article 6.1.1 does not explicitly use the word ‘deadlines’. However, the first sentence of Article 6.1.1 clearly contemplates that investigating authorities may impose appropriate time-limits on interested parties for responses to questionnaires. That first sentence also prescribes an absolute minimum of 30 days for the initial response to a questionnaire. Article 6.1.1, therefore, recognizes that it is fully consistent with the Anti-Dumping Agreement for investigating authorities to impose time limits for the submission of questionnaire responses. Investigating authorities must be able to control the conduct of their investigation and to carry out the multiple steps in an investigation required to reach a final determination. Indeed, in the absence of time-limits, authorities would effectively cede control of investigations to the interested parties, and could find themselves unable to complete their investigations within the time-limits mandated under the Anti-Dumping Agreement. We note, in that respect, that Article 5.10 of the Anti-Dumping Agreement stipulates that anti-dumping investigations shall normally be completed within one year, and in any event in no longer than 18 months, after initiation. Furthermore, Article 6.14 provides generally that the procedures set out in Article 6 ‘are not intended to prevent the authorities of a Member from proceeding expeditiously‘. (emphasis added) We, therefore, agree with the Panel that ‘in the interest of orderly administration investigating authorities do, and indeed must establish such deadlines.’⁽⁵⁸⁸⁾

 

While the United States stresses the significance of the first sentence of Article 6.1.1, we believe that importance must also be attached to the second sentence of that provision. According to the express wording of the second sentence of Article 6.1.1, investigating authorities must extend the time-limit for responses to questionnaires ‘upon cause shown‘, where granting such an extension is ‘practicable’. (emphasis added) This second sentence, therefore, indicates that the time-limits imposed by investigating authorities for responses to questionnaires are not necessarily absolute and immutable.”⁽⁵⁸⁹⁾

443.   The Panel in US — Corrosion-Resistant Steel Sunset Review stated that “the right of interested parties to submit information in a sunset review cannot be unlimited. One of the important limitations that can legitimately be imposed on that right is deadlines for the submission of information”⁽⁵⁹⁰⁾. The Panel considered that by virtue of the cross-reference in Article 11.4, the requirements of Article 6.1 and 6.2 also applied in the case of sunset reviews.⁽⁵⁹¹⁾ According to the Panel, in a sunset review as well, “there must be a balance struck between the rights of the investigating authorities to control and expedite the investigating process, and the legitimate interests of the parties to submit information and to have that information taken into account”.⁽⁵⁹²⁾

444.   The Appellate Body in US — Oil Country Tubular Goods Sunset Reviews also considered that Articles 6.1 and 6.2 do not provide for indefinite rights so as to enable respondents to submit relevant evidence, attend hearings, or participate in the inquiry as and when they choose:

“Therefore, the ‘ample’ and ‘full’ opportunities guaranteed by Articles 6.1 and 6.2, respectively, cannot extend indefinitely and must, at some point, legitimately cease to exist. This point must be determined by reference to the right of investigating authorities to rely on deadlines in the conduct of their investigations and reviews. Where the continued granting of opportunities to present evidence and attend hearings would impinge on an investigating authority’s ability to ‘control the conduct’ of its inquiry and to ‘carry out the multiple steps’ required to reach a timely completion of the sunset review, a respondent will have reached the limit of the ‘ample’ and ‘full’ opportunities provided for in Articles 6.1 and 6.2 of the Anti-Dumping Agreement.”⁽⁵⁹³⁾

445.   The Appellate Body in US — Oil Country Tubular Goods Sunset Reviews was of the view that the right to present evidence and request a hearing cannot be said to have been “denied” to a respondent that is given an opportunity to submit an initial response to the notice of initiation simply because it must do so by a deadline that is conceded to be reasonable:

“We do not see it as an unreasonable burden on respondents to require them to file a timely submission in order to preserve their rights for the remainder of the sunset review. Indeed, even an incomplete submission will serve to preserve those rights. Accordingly, we are of the view that, if a respondent decides not to undertake the necessary initial steps to avail itself of the ‘ample’ and ‘full’ opportunities available for the defence of its interests, the fault lies with the respondent, and not with the deemed waiver provision.”⁽⁵⁹⁴⁾

446.   The Appellate Body in Mexico — Anti-Dumping Measures on Rice, having examined Article 6.1.1 of the Anti-Dumping Agreement and Article 12.1.1 of the SCM Agreement, noted that these provisions explicitly require that an investigating authority provide at least 30 days for reply to all exporters and foreign producers receiving a questionnaire, to be counted, “[a]s a general rule,” from the date of receipt of the questionnaire. The Appellate Body clarified that Article 6.1 of the Anti-Dumping Agreement provides for all interested parties in an anti-dumping investigation to receive a questionnaire from the investigating authority, which includes “not only those referred to in the petition for antidumping duties, as Mexico argues, but also those that made themselves known to the investigating authority — further to the issuance of a public notice of initiation or otherwise — and those that the investigating authority might identify as a result of some inquiry of its own”:

“[T]he period of at least 30 days to reply to questionnaires, provided for in Article 6.1.1 of the Anti-Dumping Agreement and Article 12.1.1 of the SCM Agreement, must be extended to all such exporters and foreign producers, whether known to the investigating authority at the outset of the investigation or at some point thereafter.”⁽⁵⁹⁵⁾

(iv) “Due consideration should be given to any request for an extension of the 30-day period”

447.   On 26 April 2001, the Committee on Anti-Dumping Practices adopted the following “Recommendation Concerning Indicative List of Elements Relevant to a Decision on a Request for Extension of Time to Provide Information”:⁽⁵⁹⁶⁾

“The Committee notes the obligation to complete investigations within the time limits set out in Article 5.10 of the Agreement on Implementation of Article VI of GATT 1994 and the obligation to allow parties a full opportunity for the defence of their interests set out in Article 6.2 of that Agreement.

 

The Committee recognizes that investigating authorities gather information necessary to make determinations in an anti-dumping investigation through questionnaires and other requests for information, and establish deadlines for the submission of replies to such questionnaires and requests, as well as for other aspects of investigations, in order to ensure the orderly conduct and timely completion of the investigation. The Committee is mindful that each Member’s investigating authority has discretion to grant or deny a particular request for extension of a particular deadline, in light of the facts and circumstances of the investigation at hand.

 

The Committee considers that a non-binding, non-exhaustive indicative list of elements relevant to a decision whether to grant or deny such a request for extension of time to respond to a questionnaire or other request for information would be useful. In light of the foregoing, the Committee considers that the following elements may be considered by an investigating authority in deciding whether to grant or deny a request for extension of time to provide information:

 

1.   the time available for the conduct of the investigation and making the necessary determinations, including the time periods established in national legislation, regulations, and schedules governing the conduct of the investigation at hand, and whether the information can be considered in a subsequent phase of the investigation;

 

2.   previous extension(s) of time granted to the same party in the same investigation;

 

3.   the ability of the party from whom information is sought to respond to the request, in light of the nature and extent of the information requested, including the party’s available resources, personnel, and technological capability;

 

4.   any unusual burdens that will be incurred by the party being asked for information in searching for, identifying and/or compiling the information requested;

 

5.   whether the party requesting the extension has provided a partial response to the request, or has previously provided information requested in the same investigation, although the absence of a partial response alone is not an appropriate basis for denial of a request;

 

6.   any unforeseen circumstances affecting the ability of the party to provide the information requested within the time limit established;

 

7.   whether other parties have been granted extensions of time for similar reasons during the same phase of the same investigation.

 

The decision whether to grant or deny a request for an extension of time to provide information should be made promptly, and if denied, the party making such a request should be informed of the reason for its denial.”

(v) Article 6.1.1, footnote 15

448.   The Appellate Body in Mexico — Anti-Dumping Measures on Rice stated that footnote 15 does not provide any indication as to whether it is incumbent on the government of the exporting country to make the relevant exporters or producers aware of the investigation:

“[W]e cannot deduce from footnote 15 to Article 6.1.1, alone, an obligation for diplomatic authorities of the exporting Member to make their exporters or producers aware of the investigation.”⁽⁵⁹⁷⁾

(f) Article 6.1.2

(i) “evidence presented … by one party shall be made available promptly to other interested parties”

449.   In Guatemala — Cement II, Mexico claimed that Guatemala’s authority violated Articles 6.1.2, 6.2 and 6.4 by (a) refusing a Mexican producer access to the file at a certain date during the investigation, and (b) failing to promptly provide the producer with a copy of a submission made by the applicant. In examining this claim, the Panel juxtaposed the notion of “access to the file” on the one hand and, on the other hand, the requirements that evidence presented by one interested party be “made available promptly” and that parties shall have “timely opportunities” to see all relevant information:

“Article 6.1.2 of the AD Agreement provides that evidence presented by one interested party shall be ‘made available promptly’ to other interested parties. Article 6.4 provides that an interested party shall have ‘timely opportunities’ to see all information that is relevant to the presentation of its case. On their face, neither Article 6.1.2 nor Article 6.4 necessarily require access to the file. For example, if an investigating authority required each interested party to serve its submissions on all other interested parties, or if the investigating authority itself undertook to provide copies of each interested party’s submission to other interested parties, there may be no need for interested parties to have access to the file. If, however, there is no service of evidence by interested parties, or no provision of copies by the investigating authority, access to the file may be the only practical means by which evidence presented by one interested party could be ‘made available promptly’ to other interested parties (consistent with Article 6.1.2), or by which interested parties could have ‘timely opportunities’ to see information relevant to the presentation of their cases (consistent with Article 6.4). Assuming access to the file is the only practical means of complying with Articles 6.1.2 and 6.4, access to the file need not necessarily be unlimited. Nor need the file be made available on demand. Provided access to the file is regular and routine, we consider that the requirements of Articles 6.1.2 and 6.4 would be satisfied.”⁽⁵⁹⁸⁾

450.   The Panel in Guatemala — Cement II then stated that “[i]n principle, … a 20-day delay is inconsistent with … Article 6.1.2 obligation [of Guatemala’s authority] to make [the subject] submission available to [other interested parties] ‘promptly’.”⁽⁵⁹⁹⁾

(ii) “interested parties participating in the investigation”

451.   The Panel in Argentina — Poultry Anti-Dumping Duties underlined that Article 6.1.2 does not refer to “interested parties” but to “interested parties participating in the investigation”. It thus considered that had the drafters intended to extend the obligation imposed by Article 6.1.2 to all interested parties as defined in Article 6.11 of the AD Agreement, they would not have included the term “participating”. According to the Panel the term “participating” suggests that, a party must undertake some action. In the view of the Panel, “the mere knowledge by an interested party of an ongoing investigation does not make that party an interested party ‘participating in the investigation’ within the meaning of Article 6.1.2 unless it actively takes part in the investigation”.⁽⁶⁰⁰⁾ According to the Panel, an investigating authority is not required to promptly make evidence presented in writing by other interested parties available to exporters which were not even aware of the investigation such that they could participate in it.⁽⁶⁰¹⁾

(iii) “subject to the requirement to protect confidential information”

452.   With respect to the claim by Mexico that the failure to make a submission available to a Mexican producer was inconsistent with Article 6.1.2, the Panel in Guatemala — Cement II rejected Guatemala’s argument that the failure was justified because the submission contained confidential information:

“In this regard, we note that the obligation in Article 6.1.2 is qualified by the words ‘[s]ubject to the requirement to protect confidential information’. In principle, therefore, evidence presented by one interested party need not be made available ‘promptly’ to other interested parties if it is ‘confidential’. However, insofar as confidentiality is concerned, Article 6.1.2 must be read in the context of Article 6.5, which governs the treatment of confidential information. We examine Article 6.5 in detail … below. We have noted that Article 6.5 reserves special treatment for ‘confidential’ information only ‘upon good cause shown’, and we have determined that the requisite ‘good cause’ must be shown by the interested party which submitted the information at issue. Guatemala has not demonstrated, or even argued, that Cementos Progreso [the applicant] requested confidential treatment for its … submission, or that ‘good cause’ for confidential treatment was otherwise shown.⁽⁶⁰²⁾ The Article 6.1.2 proviso regarding the ‘requirement to protect confidential information’, when read in the context of Article 6.5, cannot be interpreted to allow an investigating authority to delay making available evidence submitted by one interested party to another interested party for 20 days simply because of the possibility — which is unsubstantiated⁽⁶⁰³⁾ by any request for confidential treatment from the party submitting the evidence — that the evidence contains confidential information. We do not believe that the specific requirement of Article 6.1.2 may be circumvented simply by an investigating authority determining that there is a possibility that the evidence at issue contains confidential information. Such an interpretation could undermine the purpose of Article 6.1.2, since in principle there is a possibility that any evidence could contain confidential information (and therefore not be ‘made available promptly’ to interested parties). Accordingly, we find that the Ministry violated Article 6.1.2 of the AD Agreement by failing to make Cementos Progreso’s 19 December 1996 submission available to Cruz Azul until 8 January 1997.”⁽⁶⁰⁴⁾

(g) Article 6.1.3

453.   In Guatemala — Cement II, the Panel found that Guatemala violated Article 6.1.3 because the investigating authority provided the full text of the anti-dumping application only 18 days or more after initiation of the investigation. The Panel focused on the phrase “as soon as an investigation has been initiated”:

“We note that Article 6.1.3 does not specify the number of days within which the text of the application shall be provided. What it does specify is that the text of the application be provided ‘as soon as’ the investigation has been initiated. In this regard, the term ‘as soon as’ conveys a sense of substantial urgency. In fact, the terms ‘immediately’ and ‘as soon as’ are considered to be interchangeable. We do not consider that providing the text of the application 24 or even 18 days after the date of initiation fulfils the requirement of Article 6.1.3 that the text be provided ‘as soon as an investigation has been initiated.’

 

We further consider that the timeliness of the provision of the text of the application should be evaluated in the context of its purpose and function. Timely access to the application is important for the exporters to enable preparation of the arguments in defence of their interests before the investigating authorities. Moreover, once the investigation has been initiated the timetable of the investigation commences and the timing for many events in the proceeding are counted from initiation including the 12 or 18 months total for completion of the investigation provided for in Article 5.10. Since deadlines in the timetable of the investigation are counted from the date of initiation it is critical that the investigating authority provide the text of the application ‘as soon as an investigation has been initiated’, for the exporter to be able to devise a strategy to defend the allegations it is being confronted with. Also, Article 7.3 of the AD Agreement allows a Member to impose provisional measures as early as sixty days after the date of initiation of an investigation. Access to the text of the application is crucial for the exporter to prepare its defence, and even more so if the authorities are likely to consider applying a provisional measure which may come as early as 60 days after initiation.⁽⁶⁰⁵⁾”⁽⁶⁰⁶⁾

454.   The Panel in Argentina — Poultry Anti-Dumping Duties addressed the meaning of the term “to provide” in the first sentence of Article 6.1.3. The Panel considered that:

“[T]he term ‘provide’ would require a positive action on the part of the investigating authority akin to that of furnishing or supplying something (i.e., the full text of the application) to someone (i.e., known exporters and authorities of the exporting Member). Therefore, we cannot agree with Argentina that the term ‘provide’ in the English text of the AD Agreement or ‘facilitar’ in its Spanish text can be interpreted as meaning ‘permitting access’. In our view, an investigating authority cannot comply with the obligation to ‘provide the (…) application (…) to the known exporters and to the authorities of the exporting Member’ simply by permitting them access to that application.”⁽⁶⁰⁷⁾

455.   The Panel distinguished between the obligation to “provide” the application to the known exporters and to the authorities of the exporting Member, and the obligation to “make available” the application to other interested parties upon request. According to the Panel:

“[W]ith the use of different verbs in the first sentence of Article 6.1.3, ‘provide’ on the one hand and “make available” on the other, the drafters intended to impose different obligations on investigating authorities depending on the party concerned. The first obligation requires a positive action on the part of the investigating authority, while the second envisages only a passive act”.⁽⁶⁰⁸⁾

456.   In Guatemala — Cement II, the Panel also rejected Guatemala’s argument that the actions of its investigating authority under Articles 5.5, 12.1.1 and 6.1.3, even if the Panel were to find that they constituted violations of the Anti-Dumping Agreement, had not affected the course of the investigation, and thus: (a) the alleged violations were not harmful according to the principle of “harmless error”; (b) Mexico “convalidated” the alleged violations by not objecting immediately after their occurrence; and (c) the alleged violations did not cause nullification or impairment of benefits accruing to Mexico under the Anti-Dumping Agreement. See paragraphs 390–393 above.

(h) Relationship with other paragraphs of Article 6

457.   In Guatemala — Cement II, Mexico claimed that Guatemala’s investigating authority violated Articles 6.1, 6.2, 6.8 and Annex II(5) and (6) of the Anti-Dumping Agreement by rejecting certain technical accounting evidence submitted by a Mexican interested party one day before the public hearing held by Guatemala’s authority. The Panel considered it unnecessary to address this claim, on the ground that the claim was dependent on the issue of whether the cancellation by the authority of its verification visit to the Mexican producer was inconsistent with Article 6.8, and the Panel had already found the cancellation in violation of Article 6.8.⁽⁶⁰⁹⁾

458.   The Panel in Argentina — Ceramic Tiles, when examining whether the investigating authorities were entitled to resort to facts available pursuant to Article 6.8, referred to Article 6.1 to support its conclusion that the investigating authorities could not do so when they did not clearly request the relevant information from the party in question. See paragraphs 427 above and 543 below. The Appellate Body in US — Hot-Rolled Steel further analysed the relationship of Article 6.8 and Annex II with Article 6.1.1. See paragraphs 442 above and 563 and 567 below.

459.   The Panel in Guatemala — Cement II further referred to Article 6.5 in interpreting Article 6.1.2. See paragraph 452 above.

460.   In Guatemala — Cement II, having found that Guatemala’s failure to disclose the “essential facts” forming the basis of its final determination was in violation of Article 6.9, as referenced in paragraphs 615, 616 and 618 below, the Panel considered it unnecessary to examine whether it was also inconsistent with Articles 6.1 and 6.2.⁽⁶¹⁰⁾

2. Article 6.2

(a) “shall have a full opportunity for the defence of their interests”

(i) Article 6.2, first sentence as a fundamental due process provision

461.   In Guatemala — Cement II, Mexico argued that because Guatemala’s authority extended the period of investigation during the investigation procedure, and did not respond to requests for information from a Mexican producer concerning the extension, the Mexican producer was not given any opportunity to comment on the applicant’s request for extension of the period of investigation contrary to Article 6.2. The Panel, which agreed with this argument, interpreted the first sentence of Article 6.2 “as a fundamental due process provision”:

“We interpret the first sentence of Article 6.2 of the AD Agreement as a fundamental due process provision. In our view, when a request for an extension of the POI comes from one interested party, due process requires that the investigating authority seeks the views of other interested parties before acting on that request. Failure to respect the requirements of due process would conflict with the requirement to provide interested parties with ‘a full opportunity for the defence of their interests’, consistent with Article 6.2.⁽⁶¹¹⁾ Clearly, an interested party is not able to defend its interests if it is prevented from commenting on requests made by other interested parties in pursuit of their interests. In the present case, Cementos Progreso’s request for extension of the POI was made on 1 October 1996. The Ministry’s decision to extend the POI was made on 4 October 1996, only three days after Cementos Progreso’s request. There is no evidence to suggest that the Ministry sought the views of Cruz Azul [the Mexican producer], or other interested parties, before deciding to extend the POI. Accordingly, we find that by extending the POI pursuant to a request from Cementos Progreso without seeking the views of other interested parties in respect of that request, the Ministry failed to provide Cruz Azul with ‘a full opportunity for the defence of [its] interests’, contrary to Guatemala’s obligations under Article 6.2 of the AD Agreement.”⁽⁶¹²⁾

(ii) Nature and extent of obligations under Article 6.2

462.   In Guatemala — Cement II, the Panel rejected Mexico’s claim that Guatemala’s authority was in violation of Articles 6.1, 6.2 and 6.9 by changing its injury determination from a preliminary determination of threat of material injury to a final determination of actual material injury during the course of the investigation, without informing the Mexican producer of that change, and without giving the producer a full and ample opportunity to defend itself. Following the observation based upon Article 12.2, quoted the Panel explained that the first sentence of Article 6.2 is very general in nature:

“As for Article 6.2, we note that the first sentence of that provision is very general in nature. We are unable to interpret such a general sentence in a way that would impose a specific obligation on investigating authorities to inform interested parties of the legal basis for its final determination on injury during the course of an investigation, when the express wording of Article 12.2 only imposes such a specific obligation on investigating authorities at the end of the investigation.”⁽⁶¹³⁾

463.   In Egypt — Steel Rebar, the Panel emphasized that “the language of the provision at issue creates an obligation on the [investigating authorities] to provide opportunities for interested parties to defend their interests.” The Panel further considered that the “[f]ailure by respondents to take the initiative to defend their own interests in an investigation cannot be equated, through WTO dispute settlement, with failure by an investigating authority to provide opportunities for interested parties to defend their interests”.⁽⁶¹⁴⁾

464.   The Panel in Korea — Certain Paper (Article 21.5 — Indonesia) noted that Article 6.2, interpreted in conjunction with Article 6.1, required authorities to provide interested parties in anti-dumping proceedings with “liberal opportunities … to defend their interests.”⁽⁶¹⁵⁾ In this case it was “undisputed that the KTC’s injury re-determination was based solely on the information collected in the original investigation.”⁽⁶¹⁶⁾ Korea argued that because the injury redetermination was based solely on the information from the original investigation, the KTC did not have to provide an additional opportunity to make comments on its injury analysis. Indonesia, on the other hand, argued that because the implementation proceedings at issue constituted a “new proceeding” the interested party the Sinar Mas Group was entitled to make comments on the evaluation of the Article 3.4 injury factors in such proceedings.⁽⁶¹⁷⁾ The Panel held that the Sinar Mas Group was entitled to defend its interests as provided for in Article 6.2:

“[B]ecause the implementation proceedings at issue were the continuation of the original investigation, the procedural obligations imposed on the KTC relate to this combined process. It follows that a procedural obligation that had been fulfilled in the original investigation had to be observed again in the implementation proceedings only if the steps taken in such proceedings made it necessary. We therefore do not agree with Indonesia’s contention that the KTC had to give the Sinar Mas Group an additional opportunity to comment on its injury redetermination simply because the implementation proceedings constituted a new proceeding. Nor do we agree with Korea’s assertion that because the injury redetermination was based on the information collected in the original investigation the Sinar Mas Group did not have the right to make comments on the KTC’s injury analysis in the implementation proceedings. We cannot assume that the same factual basis would in all cases lead to the same analysis regarding the impact of dumped imports on the domestic industry under Article 3.4 of the Agreement. It was, in our view, entirely possible, if not to be expected, that in the implementation proceedings at issue the KTC would have engaged in an analysis that in some respects would differ. This new analysis, in turn, could have led to a different conclusion regarding the impact of dumped imports on the domestic industry under Article 3.4. The opposite proposition would suggest that notwithstanding our finding of inconsistency under Article 3.4 in the original panel proceedings the KTC would necessarily reach the same conclusion regarding the impact of dumped imports on the domestic industry, and would imply that our finding was devoid of any potential impact on the implementation proceedings. This cannot be the case. We therefore consider that the KTC should have allowed the Sinar Mas Group to comment on the evaluation of the injury factors under Article 3.4 of the Agreement.”⁽⁶¹⁸⁾

465.   The Panel in EC — Fasteners (China) considered claims under Articles 6.4 and 6.2 in regard to the investigating authority’s failure to provide information on how normal value was established until very late in the investigation. The Panel found a violation of Article 6.4 (see paragraph 487 below) and went on to find an additional violation of Article 6.2:

“[W]hile in general we might not consider it necessary to go on to address China’s claim under Article 6.2, in this case, we consider that the discussion above is also relevant to a proper application of the obligation to ensure all interested parties a ‘full opportunity for the defence of their interests’. In our view, the Chinese exporters could not defend their interests in this investigation because the Commission only provided information concerning the product types used in the determination of the normal value at a very late stage of the proceedings, when it was no longer feasible for them to request that adjustments be made in order to ensure a fair comparison, which until that time they reasonably considered were not necessary. We therefore conclude that the European Union acted inconsistently with Article 6.2.”⁽⁶¹⁹⁾

466.   The Appellate Body in EC — Fasteners (China) confirmed the Panel’s finding under Article 6.2, holding that the finding was “consistent with the Appellate Body’s interpretation, in EC — Tube or Pipe Fittings, that the ‘presentations’ referred to in Article 6.4 ‘logically are the principal mechanisms through which an exporter subject to an anti-dumping investigation can defend its interests’ within the meaning of Article 6.2.⁽⁶²⁰⁾”⁽⁶²¹⁾

(b) Relationship with other provisions of the Agreement

467.   Addressing a claim under Article 6.2, the Panel in Guatemala — Cement II decided to exercise judicial economy because it had already made findings concerning that issue under other, more specific provisions of the Agreement:

“Whereas this provision clearly imposes a general duty on investigating authorities to ensure that interested parties have a full opportunity throughout an anti-dumping investigation for the defence of their interests, it provides no specific guidance as to what steps investigating authorities must take in practice. By contrast, other more specific provisions apply to the facts at hand, in respect of which Mexico has also made claims. Although there may be cases in which a panel will nevertheless need to address claims under Article 6.2, we do not consider it necessary for us to do when we have already made findings concerning the conduct allegedly violating Article 6.2 under other, more specific provisions of the AD Agreement.⁽⁶²²⁾”⁽⁶²³⁾

468.   In Guatemala — Cement II, Mexico made a number of claims under Articles 6.1 and 6.2 in conjunction with claims under more specific provisions of Article 6, and the Panel resolved the claims under the more specific provisions. For instance, regarding Guatemala’s failure to allow a Mexican producer “proper access” to the information submitted by the Guatemalan domestic producer at the public hearing it held, the Panel noted that it had found a violation of Articles 6.1.2 and 6.4, and declined to address Mexico’s claims under Articles 6.1 and 6.2; see paragraph 432 above. Concerning Guatemala’s failure to disclose the “essential facts” forming the basis of its final determination, the Panel found a violation of Article 6.9 and declined to rule on claims under Articles 6.1 and 6.2: see paragraphs 615–618 below.

469.   In Guatemala — Cement II, Mexico claimed that Guatemala’s investigating authority violated Articles 6.1, 6.2, 6.8 and Annex II(5) and (6) of the Anti-Dumping Agreement by rejecting certain technical accounting evidence submitted by a Mexican producer one day before the public hearing held by Guatemala’s authority. The Panel considered it unnecessary to address this claim, on the grounds that the claim was dependent on the issue of whether the cancellation by the authority of its verification visit to the Mexican producer was inconsistent with Article 6.8, and the Panel had found the cancellation in violation of Article 6.8.⁽⁶²⁴⁾

3. Article 6.4

(a) “information” that must be disclosed under Article 6.4

(i) “information … relevant to the presentation of their cases” and “used by the authorities”

470.   The Appellate Body in EC — Tube or Pipe Fittings, examining what information must be disclosed by the authorities under Article 6.4, stated that this must be examined from the perspective of the interested parties. It thus reversed the Panel’s finding in this case that the investigating authority was not obliged to disclose certain information that the investigating authority considered not relevant to its conclusions:

“Article 6.4 refers to ‘provid[ing] timely opportunities for all interested parties to see all information that is relevant to the presentation of their cases’. (emphasis added) The possessive pronoun ‘their’ clearly refers to the earlier reference in that sentence to ‘interested parties’. The investigating authorities are not mentioned in Article 6.4 until later in the sentence, when the provision refers to the additional requirement that the information be ‘used by the authorities’. Thus, whether or not the investigating authorities regarded the information in Exhibit EC-12 to be relevant does not determine whether the information would in fact have been ‘relevant’ for the purposes of Article 6.4.”⁽⁶²⁵⁾

471.   The Appellate Body in EC — Tube or Pipe Fittings also found that information relating to the Article 3.4 injury factors is necessarily “relevant” information which is to be disclosed under Article 6.4:

“This conclusion is supported by our reasoning in US — Hot Rolled Steel, where we explained that ‘Article 3.4 lists certain factors which are deemed to be relevant in every investigation and which must always be evaluated by the investigating authorities.’⁽⁶²⁶⁾ Thus, because Exhibit EC-12 contains information on some of the injury factors listed in Article 3.4, and the injury factors listed in that provision ‘are deemed to be relevant in every investigation’, Exhibit EC-12 must be considered to contain information that is relevant to the investigation carried out by the European Commission. As such, the information in Exhibit EC-12 was necessarily relevant to the presentation of the interested parties’ cases and is, therefore, ‘relevant’ for purposes of Article 6.4.”⁽⁶²⁷⁾

472. The Panel in EC — Salmon (Norway) explained that if information forms part of the information relevant to an issue before the investigating authority at the time it makes its determination, that information is “used” by the investigating authorities (and must be disclosed under Article 6.4):

“[W]hether particular information is relevant is not determined from the investigating authorities’ perspective, but with reference to the issues to be considered by the investigating authority under the AD Agreement.⁽⁶²⁸⁾ Thus, information which relates to issues which the investigating authority is required to consider under the AD Agreement, or which it does, in fact, consider, in the exercise of its discretion, during the course of an antidumping investigation, presumptively falls within the scope of Article 6.4.⁽⁶²⁹⁾… Finally, the question of whether information is “used” by the investigating authority cannot, in our view, be assessed from the perspective of whether the information is specifically referred to or relied upon by the investigating authority in its determination. If the investigating authority evaluates a question of fact or an issue of law in the course of an anti-dumping investigation, then, in our view, all information relevant to that question or issue that is before the investigating authority must necessarily be considered by the investigating authority, in order to make an objective and unbiased decision. Consequently, it seems clear to us that whether information is ‘used’ by the investigating authority must be assessed by reference to whether it forms part of the information relevant to a particular issue that is before the investigating authority at the time it makes its determination.⁽⁶³⁰⁾”⁽⁶³¹⁾

473.   Accordingly, the Panel in EC — Salmon (Norway) found that all such information in the investigating authorities’ files would be subject to timely disclosure:

“In our view, unless information submitted to the investigating authority is rejected, that information must remain in the investigating authorities’ files, and if it is relevant, not confidential, and used by the investigating authority, as discussed above, interested parties must be given timely opportunities to see it.”⁽⁶³²⁾

474.   The Appellate Body in EC — Fasteners (China) summed up past decisions on the scope of information that must be disclosed under Article 6.4:

“The Appellate Body has found that Article 6.4 refers to ‘provid[ing] timely opportunities for all interested parties to see all information that is relevant to the presentation of their cases’, and that the possessive pronoun ‘their’ clearly refers to the earlier reference in that sentence to ‘interested parties’.⁽⁶³³⁾ Therefore, it is the interested parties, rather than the authority, who determine whether the information is in fact ‘relevant’ for the purposes of Article 6.4.⁽⁶³⁴⁾ Moreover, according to the Appellate Body, whether the information was ‘used’ by the authority does not depend on whether the authority specifically relied on that information. Rather, it depends on whether the information is related to ‘a required step in the anti-dumping investigation’. ⁽⁶³⁵⁾ Thus, Article 6.4 concerns information relating to ‘issues which the investigating authority is required to consider under the [Anti-Dumping Agreement], or which it does, in fact, consider, in the exercise of its discretion, during the course of an anti-dumping investigation.’⁽⁶³⁶⁾

 

The interested parties’ right under Article 6.4, therefore, is to see all non confidential information relevant to the presentation of their cases and used by the investigating authority. Article 6.4 thus applies to a broad range of information that is used by an investigating authority for purposes of carrying out a required step in an anti-dumping investigation.…”⁽⁶³⁷⁾

 

In sum, under Article 6.4 of the Anti-Dumping Agreement, what information is considered ‘relevant to the presentation of [the interested parties’] cases’ and ‘used by the authorities’ would depend on the specific ‘step’ of the anti-dumping investigation and the particular issue before the investigating authority.”⁽⁶³⁸⁾

475. The Appellate Body in EC — Fasteners (China) pointed out that the information subject to disclosure under Article 6.4 is not limited to facts and raw data, although it does not include the investigating authority’s detailed analysis of the information:

“We note the European Union’s view that the term ‘information’ in Article 6.4 ‘concerns facts and raw data rather than factual determinations and conclusions by the investigating authorities’. In our view, there is no textual basis in Article 6.4 for limiting information ‘relevant to the presentation of [parties’] cases’ and ‘used by the authorities’ to facts or raw data unprocessed by the authorities. Indeed, the broad range of information subject to the obligation under Article 6.4 may take various forms, including data submitted by the interested parties, and information that has been processed, organized, or summarized by the authority. We do not see why only facts and raw data would be relevant to the parties’ presentation of their cases. A proper interpretation of Article 6.4 does not mean, however, that an investigating authority’s reasoning or internal deliberation in reaching its final determination is also subject to the obligation under Article 6.4. Article 6.4 concerns the information that is used by an authority, rather than an authority’s detailed analysis of the information, or the determination it reaches based on such information.”⁽⁶³⁹⁾

476.   In EC — Fasteners (China), the Appellate Body drew a connection between the duty to disclose under Article 6.4 and the investigating authority’s duty to ensure a fair comparison:

“In our view, as a starting point for the dialogue between the investigating authority and the interested parties to ensure a fair comparison, the authority must, at a minimum, inform the parties of the product groups with regard to which it will conduct the price comparisons. For example, the authority may choose to make comparisons of transaction prices for a number of groups of goods within the like product that share common characteristics, thus minimizing the need for adjustments, or it may choose to make adjustments for each difference affecting price comparability to either the normal value or the export price of each transaction to be compared. Without knowing which particular method the authority will use to categorize the products for purposes of price comparison, it would not be possible for the interested parties to know what information will be necessary for purposes of ensuring a fair comparison, and to request adjustments accordingly. Thus, as the Panel correctly found in its analysis of China’s claim under Article 6.4 of the Anti-Dumping Agreement:

 

Ensuring that the comparison of normal value and export price is based on comparable goods is, as provided for in Article 2.4, an obligation on investigating authorities. Foreign producers have a role in that process, by requesting due allowance for differences demonstrated to affect price comparability. In order to fulfil their role, and thus ensure that their interest in a fair comparison is protected, however, it is necessary that they know the basis on which the investigating authority undertakes to make the comparison of normal value and export price, and in sufficient time to allow the exporters to make and substantiate requests for due allowance.⁽⁶⁴⁰⁾”⁽⁶⁴¹⁾

477.   In EC — Fasteners (China), the Appellate Body pointed out the particular importance of disclosure under Article 6.4 to ensure a fair comparison in antidumping investigations of imports from NMEs, where normal value is established on the basis of domestic sales in an analogue country:

“[I]n an anti-dumping investigation of imports from NMEs, where the normal value is not established on the basis of the foreign producers’ domestic sales, but is established on the basis of the domestic sales in an analogue country, the investigating authority’s obligation to inform the interested parties of the basis of the price comparison is even more pertinent for ensuring a fair comparison. This is because foreign producers are unlikely to have knowledge of the specific products and pricing practices of the producer in an analogue country. Unless the foreign producers under investigation are informed of the specific products with regard to which the normal value is determined, they will not be in a position to request adjustments they deem necessary.”⁽⁶⁴²⁾

(ii) Information already available to the interested parties

478.   The Panel in EC — Tube or Pipe Fittings distinguished between information already in the possession of an interested party and information that must be available to interested parties within the meaning of Article 6.4:

“We do not view information that is already in the possession of an interested party and that has been submitted by an interested party to an investigating authority in the course of an anti-dumping proceeding as information that an investigating authority must provide opportunities for that same interested parties to see within the meaning of Article 6.4. This provision relates to information that would not initially be in the possession of an interested party and would therefore be unknown or unfamiliar to an interested party if it were not disclosed to that party in the course of an investigation.”⁽⁶⁴³⁾

479.   The Panel in EC — Fasteners (China) rejected a claim under Article 6.4 in respect of information available on a website and in a non-confidential annex in the investigation, as “the Chinese producers had adequate opportunities to see that information.”⁽⁶⁴⁴⁾

(b) “timely opportunities for all interested parties to see all information”

480.   In Guatemala — Cement II, Mexico claimed that Guatemala’s authority violated Articles 6.1.2, 6.2 and 6.4 by refusing the Mexican producer access to the file on a certain date during the investigation; and by failing to promptly provide the producer with a copy of a submission made by the applicant for the investigation. Mexico also claimed that Guatemala’s investigating authority violated Article 6.4 by failing to provide the Mexican producer with copies of the file; and by failing to provide the producer with a full record of a public hearing held by the authority. In examining these claims, the Panel explained the scope and precise meaning of the relevant provisions. See paragraph 449 above.

481.   In Guatemala — Cement II, in response to Mexico’s claim that in violation of Article 6.4, Guatemala’s authority did not provide copies of the file to the Mexican producer, Guatemala argued that it was justified in doing so because the producer had not paid the required fee. The Panel found a violation of Article 6.4 because the Mexican producer had offered to pay for the copies it requested. In so doing, the Panel noted that “[t]here are various ways in which an investigating authority could satisfy the Article 6.4 obligation to provide ‘whenever practicable … timely opportunities for all interested parties to see all information that is relevant to the presentation of their cases …’.”⁽⁶⁴⁵⁾

482.   In Guatemala — Cement II, Mexico argued that Guatemala’s authority had acted inconsistently with Article 6.4 by not providing the Mexican producer with a complete copy of the record of its public hearing. The copy of the record of the public hearing as transmitted was missing two identified individual pages, so that the words at the beginning of one page did not follow on from the phrase at the end of the immediately preceding page. Guatemala argued that even if the copy was incomplete, the Mexican producer could have requested a complete copy as soon as it realized that an omission had occurred. The Panel did not find a violation of Article 6.4:

“Despite the factual accuracy of Mexico’s argument, we do not consider that [the Ministry’s action] amounts to a violation of Article 6.4 of the AD Agreement, as Mexico has failed to adduce any evidence that the Ministry’s failure to provide a full copy of its record of the public hearing was anything other than inadvertent. Although we consider that an interested party is entitled to see a full version of the investigating authority’s record of any public hearing, it is not inconceivable that an investigating authority which chooses to provide interested parties with a copy of the record could inadvertently fail to provide a complete copy. In our view, such an inadvertent omission on the part of an investigating authority does not constitute a violation of Article 6.4. Although a violation could arise if an investigating authority failed to correct its omission after having been informed of that omission by an interested party, there is no evidence that Cruz Azul informed the Ministry of its omission in the present case.”

483.   Referring to its finding quoted in paragraph 390 above, the Panel emphasized that it was not finding a “harmless error”, an argument put forward previously by Guatemala in a different context:

“In order to avoid any uncertainty, we wish to emphasize that we do not consider that the inadvertent nature of the Ministry’s omission renders that omission ‘harmless’, in the sense of being a defence to a violation of Article 6.4 of the AD Agreement …. Our position is not that there was a violation of Article 6.4, but that such violation should be disregarded because it was ‘harmless’. Rather, our position is that the factual circumstances before us do not amount to a violation. The question of whether or not any violation is ‘harmless’ therefore does not arise.”⁽⁶⁴⁶⁾

484.   The Panel in US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina) outlined its understanding of the obligations in Article 6.4:

“Article 6.4 requires the investigating authorities to allow the interested parties in investigations and sunset reviews, whenever practicable, timely opportunities to see the information that is relevant to the presentation of their case…”

 

“The text of Article 6.4 makes it clear that it does not apply to the reasoning of the investigating authorities…”⁽⁶⁴⁷⁾

485.   The Panel in US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina), following an examination of various memoranda Argentina claimed were not shown to Argentine exporters, found that the United States had indeed acted inconsistently with Article 6.4. The Panel did not accept the argument of the United States that limited time available to make a new sunset determination was a consideration to be taken into account in assessing consistency with Article 6.4.⁽⁶⁴⁸⁾

486.   The Panel in EC — Fasteners (China), summing up the case law on Article 6.4, noted that

“Article 6.4 generally stipulates that the authorities shall give interested parties ‘opportunities’ to see all information used by the investigating authorities in an anti-dumping investigation. This right, however, is not unlimited. First, it applies to information which is used by the authorities. Second, the information must be relevant to the presentation of the interested parties’ cases. Third, this right does not apply to confidential information. Fourth, the investigating authorities have to provide these opportunities ‘whenever practicable’, and on a ‘timely’ basis.⁽⁶⁴⁹⁾ …

 

In addition, …Article 6.4 does not obligate the investigating authorities to actively disclose information to interested parties… . In our view, a violation of Article 6.4 would normally require a showing that the investigating authorities denied an interested party’s request to see information used by the authorities, which was relevant to the presentation of that interested party’s case and which was not confidential.”⁽⁶⁵⁰⁾

487.   The Appellate Body in EC — Fasteners (China) confirmed the Panel’s finding that the EU authority violated Article 6.4 “by not providing a timely opportunity for Chinese producers to see information regarding the product types on the basis of which normal value was established”.⁽⁶⁵¹⁾ As the Panel described it, “Chinese producers were informed very late in the proceedings of the product types that formed the basis of the comparisons underlying the Commission’s dumping determinations. Two of them requested information pertaining to those product types, but were not given a timely opportunity to see the relevant information by the Commission.⁽⁶⁵²⁾”⁽⁶⁵³⁾ The Appellate Body agreed that the product types used by the Commission for purposes of comparing the export price and normal value in the fasteners investigation constituted “information relevant to the presentation” of the Chinese parties’ case, because, without such information, “it would be difficult if not impossible, for foreign producers to request adjustments that they consider necessary in order to ensure a fair comparison.”⁽⁶⁵⁴⁾

(c) No independent disclosure obligation

488.   The Panel in Korea — Certain Paper (Article 21.5 — Indonesia) noted that Article 6.4 did not impose an independent disclosure obligation on the authorities — that is, there was no requirement on the authorities to disclose information to the interested parties where there was no request to that effect.⁽⁶⁵⁵⁾

489.   The Panel in EC — Fasteners (China) also considered a claim under Articles 6.2 and 6.4 regarding deficiencies in disclosure to the Chinese producers, as reflected in the General and Individual Disclosure Documents. The Panel rejected the claim because Articles 6.4 and 6.2 do not impose any affirmative disclosure obligations on the investigating authorities.⁽⁶⁵⁶⁾ As the Panel stated:

“Article 6.4 does not obligate the investigating authorities to actively disclose information to interested parties… . In our view, a violation of Article 6.4 would normally require a showing that the investigating authorities denied an interested party’s request to see information used by the authorities, which was relevant to the presentation of that interested party’s case and which was not confidential.”⁽⁶⁵⁷⁾

490.   The Panel in EC — Fasteners (China) rejected a claim under Articles 6.4 and 6.2 regarding inadequate explanation on the comparisons made in the investigation, stating that “we see nothing in the text of either Article 6.4 or Article 6.2 that requires an investigating authority to give any explanation at all with respect to the information it makes available to the parties.⁽⁶⁵⁸⁾”⁽⁶⁵⁹⁾

(d) Confidentiality: access to own confidential information

491.   The Panel in Korea — Certain Paper interpreted the reference in Article 6.4 to “information… that is not confidential as defined in paragraph 5”:

“Article 6.4 precludes the IA from disclosing confidential information to the interested parties. However, that provision cannot, in our view, possibly be interpreted to deny an interested party access to its own confidential information. That is, confidentiality cannot be used as the basis for denying access to information against the company which submitted the information. The notion of confidentiality, as elaborated upon in Article 6.5 of the Agreement, is about preserving confidentiality of information that concerns one interested party vis-à-vis the other interested parties.”⁽⁶⁶⁰⁾

(e) Relationship with other paragraphs of Article 6

492.   In Guatemala — Cement II, Mexico made a number of claims under Article 6.4 in conjunction with claims under more specific provisions of Article 6, and the Panel resolved the claims under the more specific provisions. Regarding Guatemala’s failure to require the domestic producer to provide reasons why certain information could not be made public, the Panel found a violation of Article 6.5.1 and declined to rule on other grounds including Article 6.4; see paragraph 509. Regarding Guatemala’s failure to allow the Mexican producer “proper access” to the information submitted by the Guatemalan domestic producer at the public hearing it held, the Panel found a violation of Articles 6.1.2 and 6.4 and declined to rule under Articles 6.1 and 6.2; see paragraph 432 above. Regarding Guatemala’s delay in making a submission by the applicant available to the Mexican producer, the Panel found a violation of Article 6.1.2, and declined to rule on Article 6.4.⁽⁶⁶¹⁾

493.   The Panel in Guatemala — Cement II also discussed the relationship between the obligations under Articles 6.4 and 6.9. See paragraph 616 below.

494.   The Appellate Body in EC — Tube or Pipe Fittings expressed the view that a finding of violation in that case under Article 6.4 would necessarily entail a violation of Article 6.2.⁽⁶⁶²⁾

495.   The Panel in EC — Fasteners (China), considering claims brought under Articles 6.5, 6.4 and 6.2 in respect of the decision in paragraph 502 below, noted that “both Articles 6.4 and 6.2 exempt confidential information from the scope of the rights that they confer upon interested parties in an investigation … the rights of interested parties set forth in these two provisions do not apply to confidential information. It follows that to find a violation of Articles 6.4 and 6.2, we necessarily have to find a violation of Article 6.5, which would mean that the identity of the complainants and the supporters should not have been treated as confidential information. It is only if that information was wrongly treated as confidential that we can engage in a substantive analysis of China’s claims under Articles 6.4 and 6.2.”⁽⁶⁶³⁾ The Panel found that there was no violation of Article 6.5, and consequently no violation of Article 6.4 or 6.2.

4. Article 6.5

(a) “Any information which is by its nature confidential”

(i) Nature of confidential information protected

496.   In Guatemala — Cement II, the Panel discussed the scope of Article 6.5:

“The text of Article 6.5 distinguishes between two types of confidential information: (1) ‘information which is by nature confidential’, and (2) information ‘which is provided on a confidential basis’. Article 6.5 then provides that the provision of confidential treatment is conditional on ‘good cause’ being shown. Logically, one might expect that ‘good cause’ for confidential treatment of information which is ‘by nature confidential’ could be presumed, and that ‘good cause’ need only be shown for information which is not ‘by nature confidential’ (but for which confidential treatment is nonetheless sought). It is presumably for this reason that, in rejecting Mexico’s claim, Guatemala argues that the relevant information was ‘clearly of a confidential nature’. While we have some sympathy for Guatemala’s argument, given the logical appeal of such an interpretation of Article 6.5, we note that Article 6.5 is not drafted in a way which suggests this approach. Instead, the requirement to show ‘good cause’ appears to apply for both types of confidential information, such that even information ‘which is by nature confidential’ cannot be afforded confidential treatment unless ‘good cause’ has been shown.⁽⁶⁶⁴⁾”⁽⁶⁶⁵⁾

497.   The Panel in Korea — Certain Paper considered a similar claim regarding confidential treatment accorded to information in the domestic industry’s application. Noting that the phrase “upon good cause shown” is preceded by both types of confidentiality in the text of Article 6.5, the Panel found that “the text of Article 6.5 makes it clear that the good cause requirement applies to both types of confidential information. That is, some showing of good cause is necessary for the confidential treatment of information that is by nature confidential. The degree of that requirement may, however, depend on the type of information concerned.”⁽⁶⁶⁶⁾

498.   The Panel in EC — Fasteners (China) noted that “it is now well established that the good cause requirement for confidential treatment applies both to information that is by nature confidential and to information submitted on a confidential basis. Thus, whether the identity of the complainants and the supporters was by nature confidential or was submitted on a confidential basis is not relevant to our analysis.”⁽⁶⁶⁷⁾

499.   The Panel in EC — Fasteners (China) also observed that “information that is publicly available is not confidential within the meaning of Article 6.5” and found that by treating information that was available from the Eurostat website as confidential information, without good cause shown, the investigating authority had violated Article 6.5; the fact that the information was available in the public domain was not an excuse for disregarding the requirements of Article 6.5.⁽⁶⁶⁸⁾

500.   The Appellate Body in EC — Fasteners (China) remarked regarding the nature of confidential information:

“The question of whether information is ‘by nature’ confidential depends on the content of the information. Information that is ‘provided on a confidential basis’ is not necessarily confidential by reason of its content, but rather, confidentiality arises from the circumstances in which it is provided to the authorities. These two categories may, in practice, overlap.”⁽⁶⁶⁹⁾

(ii) Scope of information protected under Article 6.5

501.   The Appellate Body in EC — Fasteners (China), discussing obligations under Article 6.5 generally, considered which parties’ information is protected under Article 6.5, finding inter alia that such protection extends to all parties taking part in an investigation, including analogue country producers in an investigation of non-market economy producers:

“In examining the scope of Article 6.5, we note that it extends the need to request confidential treatment to information submitted by ‘parties to an investigation’ rather than those in the specifically defined group of ‘interested parties’. As such, Article 6.5 does not limit the protection afforded to sensitive information to the ‘interested parties’ expressly listed under Article 6.11 of the Anti-Dumping Agreement. In our view, the term ‘parties to an investigation’ refers to any person who takes part or is implicated in the investigation. Moreover, Article 6.11 does not contain an exhaustive list of ‘interested parties’, but states that ‘interested parties’ shall include the persons or groups listed in that Article. In our view, the persons expressly listed in Article 6.11 are those who are in every case considered to be ‘interested parties’, but are not the only persons who may be considered ‘interested parties’ in a particular investigation. We do not believe that an investigating authority is relieved of its obligations under Article 6.5 merely because a participant in the investigation does not appear on the list of ‘interested parties’ in Article 6.11.⁽⁶⁷⁰⁾ Rather, once ‘good cause’ is shown, confidential treatment of sensitive information must be afforded to any party who takes part or is implicated in the investigation or in the provision of information to an authority. Pursuant to Article 6.5 such parties include persons supplying information, persons from whom confidential information is acquired, and parties to an investigation.”⁽⁶⁷¹⁾

(b) “upon good cause shown”

(i) Scope of “good cause”

502.   The Appellate Body in EC — Fasteners (China) commented generally on “good cause” in Article 6.5:

“The ‘good cause’ alleged must constitute a reason sufficient to justify the withholding of information from both the public and from the other parties interested in the investigation, who would otherwise have a right to view this information under Article 6 of the Anti-Dumping Agreement. Put another way, ‘good cause’ must demonstrate the risk of a potential consequence, the avoidance of which is important enough to warrant the nondisclosure of the information. ‘Good cause’ must be assessed and determined objectively by the investigating authority, and cannot be determined merely based on the subjective concerns of the submitting party.

 

We find that the examples provided in Article 6.5 in the context of information that is ‘by nature’ confidential are helpful in interpreting ‘good cause’ generally, because they illustrate the type of harm that might result from the disclosure of sensitive information, and the protectable interests involved. Article 6.5 states that the disclosure of such information ‘would be of significant competitive advantage to a competitor’ or ‘would have a significantly adverse effect upon a person supplying the information or upon a person from whom that person acquired the information’. These examples suggest that a ‘good cause’ which could justify the non-disclosure of confidential information might include an advantage being bestowed on a competitor, or the experience of an adverse effect on the submitting party or the party from which it was acquired. These examples are only illustrative, however, and we consider that a wide range of other reasons could constitute ‘good cause’ justifying the treatment of information as confidential under Article 6.5.

 

In practice, a party seeking confidential treatment for information must make its ‘good cause’ showing to the investigating authority upon submission of the information. The authority must objectively assess the ‘good cause’ alleged for confidential treatment, and scrutinize the party’s showing in order to determine whether the submitting party has sufficiently substantiated its request. In making its assessment, the investigating authority must seek to balance the submitting party’s interest in protecting its confidential information⁽⁶⁷²⁾ with the prejudicial effect that the non-disclosure of the information may have on the transparency and due process interests of other parties involved in the investigation to present their cases and defend their interests. The type of evidence and the extent of substantiation an authority must require will depend on the nature of the information at issue and the particular ‘good cause’ alleged. The obligation remains with the investigating authority to examine objectively the justification given for the need for confidential treatment. If information is treated as confidential by an authority without such a ‘good cause’ showing having been made, the authority would be acting inconsistently with its obligations under Article 6.5 to grant such treatment only ‘upon good cause shown’.”⁽⁶⁷³⁾

503.   In the investigation underlying the dispute in EC — Fasteners (China), the complainants and supporters of the complaint requested the investigating authority to treat their identities as confidential in order “to avoid a potential retaliation which could be carried out by some of their Customers who also buy products directly from P.R. China”.⁽⁶⁷⁴⁾ The complainants alleged that, if these customers knew which European producers had requested or supported the initiation of this investigation, they might discontinue purchasing fasteners from those producers. The investigating authority accepted this request and conveyed its decision to the foreign producers who had questioned the authority on the complainants’ identity.⁽⁶⁷⁵⁾ The Panel rejected a claim by China that this decision violated Article 6.5. The Panel observed:

“Article 6.5 does not … explain what ‘good cause’ means. In our view, this is something that has to be assessed by the investigating authorities in light of the circumstances of each investigation and each request for confidential treatment. We also consider that what constitutes ‘good cause’ will depend on the nature of the information at issue for which confidential treatment is sought.⁽⁶⁷⁶⁾ The ‘good cause’ alleged to exist, in turn, will determine the kind of supporting evidence that may be needed in order to demonstrate the existence of such ‘good cause’.

 

… in this dispute the core of the disagreement between the parties is whether ‘potential commercial retaliation’ constitutes good cause to justify confidential treatment of the identity of the complainants and the supporters of the complaint. On its face, we see nothing in Article 6.5 that would exclude potential commercial retaliation from constituting good cause for the confidential treatment of any information, including the identity of the complainants… . We recall that in elucidating what may constitute information that is by nature confidential, Article 6.5 refers to, inter alia, situations where the disclosure of the information ‘would have a significantly adverse effect upon a person supplying the information or upon a person from whom that person acquired the information’. We can certainly see that ‘potential commercial retaliation’ from the complainants’ customers who, in addition to buying the subject product from the complainants, also purchase imports from the country subject to the complaint, might have a ‘significantly adverse effect’ upon the complainants.”⁽⁶⁷⁷⁾

504.   The Appellate Body upheld the Panel’s finding that the potential commercial retaliation alleged by the complainants satisfied the “good cause” requirement of Article 6.5:

“[W]e do not understand China to argue that ‘commercial retaliation’ may not constitute a ‘good cause’ justification for confidential treatment. In this respect, we agree with the Panel that ‘nothing in Article 6.5 … would exclude potential commercial retaliation from constituting good cause for the confidential treatment of any information, including the identity of complainants’, and China does not challenge this finding.”⁽⁶⁷⁸⁾

(ii) Requirement for “good cause” to be shown

505.   In Guatemala — Cement II, the Panel agreed that Guatemala’s investigating authority violated Articles 6.5, 6.5.1 and 6.5.2 by providing confidential treatment to a submission from the domestic producer on its own initiative, i.e. without “good cause” having been shown by the producer:

“In our view, the requisite ‘good cause’ must be shown by the interested party submitting the confidential information at issue. We do not consider that Article 6.5 envisages ‘good cause’ being shown by the investigating authority itself, since — with respect to information that is not ‘by nature confidential’ in particular — the investigating authority may not even know whether or why there is cause to provide confidential treatment.”⁽⁶⁷⁹⁾

506.   In EC — Fasteners (China), China argued that when the investigating authority decided to keep the complainants’ identities confidential as discussed in paragraph 502 above, it violated Article 6.5 by relying on the allegations in the complaint and not requiring evidence showing the existence of the alleged commercial retaliation. In a finding upheld by the Appellate Body, the Panel did not consider this to be a “fatal lack of evidence” in part because it was unlikely that evidence of potential commercial retaliation would be obtainable:

“[U]nless there is some reason to believe that the fear of retaliation is unreasonable, unfounded, or untrue — and China has proffered none — we consider that the allegation of the complainants in this case is a sufficient basis for the Commission’s conclusion. We note in this regard that, in our view, the purpose of granting confidential treatment as provided for in Article 6.5 is precisely to make sure that a feared adverse effect, in this case ‘potential commercial retaliation’, remains hypothetical, and does not actually materialize. Second, … by stating that their customers were also themselves importers of the subject product from China, the complainants substantiated their assertion to a certain degree by explaining the circumstances which they thought showed that commercial retaliation could happen. We therefore disagree with China’s contention that the ‘potential commercial retaliation’ alleged by complainants did not constitute good cause within the meaning of Article 6.5.”⁽⁶⁸⁰⁾

507.   The Panel in EC — Fasteners (China) also found that “the fact that the names of the companies that made up the sample for purposes of the injury analysis were disclosed does not affect the analysis with respect to the confidential treatment of the names of the complainants and supporters. The sampled companies can clearly be identified as cooperating, otherwise they would not have been included in the sample, but this is not necessarily the same as being identified as complainants themselves, and thus might not cause the same concerns for those companies.”⁽⁶⁸¹⁾

(c) “Such information shall not be disclosed without specific permission”

508.   The Panel in EC — Fasteners (China) found that the European Union violated Article 6.5 by disclosing the information reported in nine Chinese producers’ MET/IT Claim Forms (discussed at paragraph 439 above) to all nine Chinese producers, to the Chinese authorities and to other interested parties including the complainants, without asking or receiving the submitters’ permission for disclosure. The Panel noted that the forms were submitted on a confidential basis and labelled as confidential. The Panel further noted:

“[I]n the circumstances of this case, we do not consider it necessary for us to determine whether or not the information in the MET/IT Claim Forms, or in the MET Disclosure Document, was properly treated as confidential under Article 6.5… merely because a document is labelled as such does not demonstrate that the information it contains is confidential within the meaning of Article 6.5. It is clear that an investigating authority may conclude that information submitted as confidential does not merit such treatment. However, in such a case, Article 6.5.2 of the AD Agreement establishes certain requirements, not least of which is to give the supplier of the information an opportunity to make the information public or to authorize its disclosure in generalized or summary form. Moreover, even if the investigating authority concludes that a request for confidentiality is not warranted, Article 6.5.2 provides that if the supplier is unwilling to make the information public or to authorize its disclosure in generalized or summary form, the authorities may disregard the information.⁽⁶⁸²⁾ Article 6.5.2 does not, however, authorize the authorities to provide the information to other interested parties in the investigation. In any event, even assuming, as the European Union asserts, that the MET Disclosure Document does not contain any data on the volume, value, or unit price of sales, actual costs of the companies concerned, percentage or value of profits, value of any subsidy received, or the value of the assets of the companies examined, this does not, in our view, demonstrate that the document contains only non-confidential information. Information which may properly be treated as confidential under Article 6.5 is not necessarily limited to data of the types referred to by the European Union, but may include any type of information submitted on a confidential basis.”⁽⁶⁸³⁾

(d) Article 6.5.1

509.   In Guatemala — Cement II, the Panel agreed that Guatemala’s authority violated Article 6.5.1 by failing to require the domestic producer to provide reasons why certain information could not be made public:

“Although Article 6.5.1 does not explicitly provide that ‘the authorities shall require’ interested parties to provide a statement of the reasons why summarization is not possible, any meaningful interpretation of Article 6.5.1 must impose such an obligation on the investigating authorities… .in our view Article 6.5.1 imposes an obligation on investigating authorities to require parties that indicate that information is not susceptible of summary to provide a statement of the reasons why summarization is not possible. … In making this finding, we attach no importance whatsoever to Guatemala’s assertions concerning the alleged treatment of similar information by other WTO Members. Whether or not other WTO Members act in conformity with Article 6.5.1 is of no relevance to the present dispute, which concerns the issue of whether or not the Ministry acted in conformity with that provision.”⁽⁶⁸⁴⁾

510.   The Panel then considered it unnecessary to address Mexico’s claim under Articles 6.1, 6.2, 6.4, 6.5 and 6.5.2 on the same factual ground, because “the need for a statement of the reasons why the information is not susceptible of summary is specifically addressed by Article 6.5.1.”⁽⁶⁸⁵⁾

511.   In Argentina — Ceramic Tiles, the Panel, while examining whether the authorities were allowed to rely on confidential information in their determination (see paragraph 598 below), considered that the purpose of the non-confidential summaries is to inform the interested parties so as to enable them to defend their interests:

“Consistent with our view that authorities may rely on confidential information in making their determination, the purpose of the non-confidential summaries provided for in Article 6.5.1 is to inform the interested parties so as to enable them to defend their interests. We do not consider that the purpose of the non-confidential summaries is to enable the authorities to arrive at public conclusions, as Argentina contends. Thus, an authority would not in our view be justified in rejecting the exporters’ responses simply because the information in the non-confidential summaries was not sufficient to allow the calculation of normal value, export price, and the margin of dumping.”⁽⁶⁸⁶⁾

512.   The Panel in Mexico — Steel Pipes and Tubes set out its general analysis of Article 6.5.1:

“We consider that the conditions set out in Article 6.5, chapeau, and 6.5.1 are of critical importance in preserving the balance between the interests of confidentiality and the ability of another interested party to defend its rights throughout an anti-dumping investigation. For precisely this reason, we consider it paramount for an investigating authority to ensure that the conditions in these provisions are fulfilled. We consider it equally important for a WTO Panel called upon to review an investigating authority’s treatment of confidential information strictly to enforce these conditions, while remaining cognizant of the applicable standard of review.”⁽⁶⁸⁷⁾

513.   In Mexico — Steel Pipes and Tubes, Guatemala asserted that Mexico had violated Article 6.5 by failing to require the applicant to provide non-confidential summaries, to evaluate the sufficiency of the summaries, and to disclose properly information that was not shown upon good cause to be confidential, or, alternatively, to disclose non-confidential summaries of confidential information. The Panel did not consider that the obligations contained in Article 6.5 “set forth exactly how an investigating authority should or must evaluate a request for confidential treatment”.⁽⁶⁸⁸⁾ In this case, the Panel considered that Mexico had “adhered to the minimum threshold permitted by Articles 6.5 and 6.5.1 in its treatment of the confidential information concerned.”⁽⁶⁸⁹⁾

514.   The Appellate Body in EC — Fasteners (China) set out its general analysis of Article 6.5.1 in the context of Article 6.5:

“Whenever information is treated as confidential, transparency and due process concerns will necessarily arise because such treatment entails the withholding of information from other parties to an investigation. Due process requires that interested parties have a right to see the evidence submitted or gathered in an investigation, and have an adequate opportunity for the defence of their interests. As the Appellate Body has stated, ‘that opportunity must be meaningful in terms of a party’s ability to defend itself’.⁽⁶⁹⁰⁾

 

Articles 6.5 and 6.5.1 accommodate the concerns of confidentiality, transparency, and due process by protecting information that is by nature confidential or is submitted on a confidential basis and upon ‘good cause’ shown, but establishing an alternative method for communicating its content so as to satisfy the right of other parties to the investigation to obtain a reasonable understanding of the substance of the confidential information, and to defend their interests. As the Panel found, ‘Article 6.5.1 serves to balance the goal of ensuring that the availability of confidential treatment does not undermine the transparency of the investigative process’.⁽⁶⁹¹⁾ In respect of information treated as confidential under Article 6.5, Article 6.5.1 obliges the investigating authority to require that a non-confidential summary of the information be furnished, and to ensure that the summary contains ‘sufficient detail to permit a reasonable understanding of the substance of the information submitted in confidence’. The sufficiency of the summary provided will therefore depend on the confidential information at issue, but it must permit a reasonable understanding of the substance of the information withheld in order to allow the other parties to the investigation an opportunity to respond and defend their interests.

 

Article 6.5.1 contemplates that in ‘exceptional circumstances’ confidential information may not be ‘susceptible of summary’. In such exceptional circumstances, a party may indicate that it is not able to furnish a non-confidential summary of the information submitted in confidence, but it is nevertheless required to provide a ‘statement of the reasons why summarization is not possible’. Article 6.5.1 relieves a party of its duty to provide a non-confidential summary of information submitted in confidence only if doing so ‘is not possible’. It is not enough for a party simply to claim that providing a summary would be burdensome or costly. Summarization of information will not be possible where no alternative method of presenting that information can be developed that would not, either necessarily disclose the sensitive information, or necessarily fail to provide a sufficient level of detail to permit a reasonable understanding of the substance of the information submitted in confidence.

 

Where information is kept confidential upon ‘good cause’ shown, and it is not possible to provide a non-confidential summary of the information that permits a reasonable understanding of its substance, the balance struck under Articles 6.5 and 6.5.1 is altered, and the due process rights of other parties to the investigation are not fully respected. Therefore, when it is not possible to furnish a non-confidential summary, Article 6.5.1 requires a party to identify the exceptional circumstances and provide a statement explaining the reasons why summarization is not possible. For its part, the investigating authority must scrutinize such statements to determine whether they establish exceptional circumstances, and whether the reasons given appropriately explain why, under the circumstances, no summary that permits a reasonable understanding of the information’s substance is possible.⁽⁶⁹²⁾ As the Panel found, ‘in the absence of scrutiny of non-confidential summaries or stated reasons why summarization is not possible by the investigating authority, the potential for abuse under Article 6.5.1 would be unchecked unless and until the matter were reviewed by a panel.’⁽⁶⁹³⁾ This ‘would obviously defeat the goal of maintaining transparency during the course of the investigation itself that is one of the purposes of Article 6.5’.⁽⁶⁹⁴⁾ In sum, Article 6.5.1 imposes an obligation on the investigating authorities to ensure that sufficiently detailed non-confidential summaries are submitted to permit a reasonable understanding of the substance of the confidential information; and, in exceptional circumstances, to ensure that parties provide a statement appropriately explaining the reasons why particular pieces of confidential information are not susceptible of summary.”⁽⁶⁹⁵⁾

515.   In EC — Fasteners (China), examining the non-confidential questionnaire responses of two domestic producers in the fasteners investigation, the Appellate Body upheld the Panel’s findings that the investigating authority had failed to ensure the producers’ compliance with the requirements of Article 6.5.1 and had itself acted inconsistently with Article 6.5.1.⁽⁶⁹⁶⁾ The Appellate Body noted that in each instance, essential data and a non-confidential summary were missing, there was no appropriate statement of reasons why summarization was not possible, and the Panel record did not indicate that the investigating authority examined the producers’ statements to evaluate their consistency with Article 6.5.1.⁽⁶⁹⁷⁾ The Appellate Body commented further that the absence of sanctions on interested parties in the Anti-Dumping Agreement “does not derogate from the obligatory nature of the requirements. It does not mean, as the European Union argues, that an investigating authority must merely make best efforts to ensure that such summaries or statements of reasons are provided.”⁽⁶⁹⁸⁾

(e) Disclosure of confidential information under protective order

516.   In US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina), Argentina claimed that the USDOC acted inconsistently with Article 6.5 because it failed to require the “petitioners to submit a non-confidential summary of the confidential information that they submitted or because the non-confidential summary of the confidential information submitted by the petitioners did not provide a reasonable understanding of the substance of the information ….”⁽⁶⁹⁹⁾ The United States argued that because US law allowed counsel for parties to access all confidential information on the record, there was no violation of Article 6.5.1. The Panel did not agree with the United States:

“Article 6.5.1 protects the right of the interested parties generally to be reasonably informed about the substance of the confidential information that may be submitted by any other interested party. What matters for purposes of Article 6.5.1 is whether the interested parties themselves receive non-confidential summaries of the confidential information submitted to the investigating authorities…”⁽⁷⁰⁰⁾

517.   The Panel in Mexico — Steel Pipes and Tubes examined an argument that failure to provide non-confidential summaries had not prejudiced the Guatemalan exporter, as it could have had access to the confidential record under procedures provided by Mexico. The Panel found:

“while such a system of limited disclosure is certainly envisaged by Article 6.5, and may certainly act as a supplement to a Member’s fulfilment of its obligations under Article 6.5, we find no textual basis in Article 6.5 that would indicate to us that permitting limited access to the entire confidential record to individuals fulfilling certain conditions, provides a derogation from, or replaces, the obligations of an investigating authority under Article 6.5 to require justification for treatment of information as confidential and, if such treatment is justified, to require non-confidential summaries of the confidential information, or, alternatively, to require justification for the non-summarization of certain information.”⁽⁷⁰¹⁾

(f) Article 6.5.2

518.   In Guatemala — Cement II, the Panel rejected Mexico’s claim that Guatemala’s authority had violated Article 6.5.2 by agreeing to provide confidential treatment for certain information submitted during the verification visit at the domestic producer’s premises. Mexico’s claim of violation was based on the domestic producer’s alleged failure to justify its request for confidential treatment. The Panel held:

“Article 6.5.2 does not require any justification to be provided by the interested party requesting confidential treatment. If any such obligation exists, it derives from Article 6.5, not 6.5.2. Mexico has not based this claim on Article 6.5. Article 6.5.2 speaks only to events when ‘the authorities find that a request for confidentiality is not warranted’.”⁽⁷⁰²⁾

(g) Relationship with other paragraphs of Article 6

519.   The Panel, in Argentina — Ceramic Tiles, referred to Articles 6.5 and 6.5.1 of the Anti-Dumping Agreement as support of its conclusion that an investigating authority may rely on confidential information in making determinations while respecting its obligation to protect the confidentiality of that information. See paragraph 598 below.

5. Article 6.6

(a) “satisfy themselves as to the accuracy of the information”

520.   In support of its opinion that the text of Article 6.6 does not explicitly require verification of all information relied upon, the Panel in US — DRAMS stated:

“Article 6.6 simply requires Members to ‘satisfy themselves as to the accuracy of the information’. In our view, Members could ‘satisfy themselves as to the accuracy of the information’ in a number of ways without proceeding to some type of formal verification, including for example reliance on the reputation of the original source of the information. Indeed, we consider that anti-dumping investigations would become totally unmanageable if investigating authorities were required to actually verify the accuracy of all information relied on.⁽⁷⁰³⁾”⁽⁷⁰⁴⁾

521.   In Guatemala — Cement II, addressing Mexico’s claim under Article 6.6, the Panel explained the nature of the obligation under this Article:

“In our view, it is important to distinguish between the accuracy of information, and the substantive relevance of such information. Once an investigating authority has determined what information is of substantive relevance to its investigation, Article 6.6 requires the investigating authority to satisfy itself (except when ‘best information available’ is used) that the substantively relevant information is accurate. Thus, Article 6.6 applies once an initial determination has been made that the information is of substantive relevance to the investigation. Article 6.6 provides no guidance in respect of the initial determination of whether information is, or is not, of substantive relevance to the investigation.”⁽⁷⁰⁵⁾

(b) Burden on the investigating authorities

522.   In Argentina — Ceramic Tiles, the Panel confirmed that “the burden of satisfying oneself of the accuracy of the information” is “on the investigating authority”:

“Article 6.6 of the AD Agreement thus places the burden of satisfying oneself of the accuracy of the information on the investigating authority. As a general rule, the exporters are therefore entitled to assume that unless otherwise indicated they are not required to also automatically and in all cases submit evidence to demonstrate the accuracy of the information they are supplying… . We believe that if no on-the-spot verification is going to take place but certain documents are required for verification purposes, the authorities should in a similar manner inform the exporters of the nature of the information for which they require such evidence and of any further documents they require.”⁽⁷⁰⁶⁾

6. Article 6.7 and Annex I

(a) Relationship between Article 6.7 and Annex I

523.   As regards the relationship between Article 6.7 and Annex I, in Egypt — Steel Rebar, the Panel came to the same conclusion as with the relationship between Article 6.8 and Annex II (see paragraph 536 below), i.e. that Annex I is incorporated by reference into Article 6.7:

“Concerning the relationship of Annex I to Article 6.7, we come to the same conclusion as in respect of Annex II and Article 6.8.⁽⁷⁰⁷⁾ In particular, we note Article 6.7’s explicit cross-reference to Annex I: ‘[T]he procedures described in Annex I shall apply to investigations carried out in the territory of other Members’. This language thus establishes that the specific parameters that must be respected in carrying out foreign verifications in compliance with Article 6.7 are found in Annex I.”⁽⁷⁰⁸⁾

(b) On-the-spot verifications as an option

524.   The Panel in Argentina — Ceramic Tiles indicated in a footnote that, although common practice, there is no requirement to carry out on-the-spot verifications:

“There does not exist a requirement in the Agreement to carry out investigations in the territory of other Members for verification purposes. Article 6.7 of the AD Agreement merely provides for this possibility. While such on-site verification visits are common practice, the Agreement does not say that this is the only way or even the preferred way for an investigating authority to fulfil its obligation under Article 6.6 to satisfy itself as to the accuracy of the information supplied by interested parties on which its findings are based.”⁽⁷⁰⁹⁾

525.   The Panel in EC — Tube or Pipe Fittings rejected the argument that Article 2.4 required the investigating authority to base the adjustment on a visual/physical inspection of the working activities and practices in the packaging area at the company’s premises. The Panel stated that it viewed verification as an essentially “documentary” exercise that may be supplemented by an actual on-site visit, which is not mandated by the Agreement. According to the Panel, “[a]n essentially documentary approach to verification — which focuses upon documented support for claims for adjustment — seems to us to be entirely consistent with the nature of an anti-dumping investigation.⁽⁷¹⁰⁾”⁽⁷¹¹⁾

(c) Information verifiable on-the-spot

526.   In Guatemala — Cement II, Mexico argued Guatemala’s authority had acted inconsistently with Article 6.7 and paragraph 7 of Annex I by seeking to verify certain information that was not submitted by the Mexican producer subject to the investigation because it pertained to a period of investigation newly added during the course of the investigation. The Panel rejected this argument:

“Although Annex I(7) provides that the ‘main purpose’ of the verification visit is to verify information already provided, or to obtain further details in respect of that information, it also provides that an investigating authority may ‘prior to the visit … advise the firms concerned … of any further information which needs to be provided’. Since there would be little point in advising a firm of ‘further information … to be provided’ in advance of the verification visit if the investigating authority were precluded from examining that ‘further information’ during the visit, we consider that the phrase ‘further information … to be provided’ refers to information to be provided during the course of the verification. Mexico’s view that an investigating authority may only verify information submitted prior to the verification visit is not consistent with this interpretation of Annex I(7).

 

In response to a question from the Panel, Mexico argues that the phrase ‘any further information … to be provided’ refers to accounting information to be provided by the verified company during verification in order to substantiate the information previously supplied to the investigating authority. We note, however, that the phrase does not read ‘any further accounting information … to be provided’. The term ‘information’ is not qualified in any way by the express wording of Annex I(7), and there are no elements in the context which plead for such qualification.

 

Furthermore, we note that the last phrase of Annex I(7) refers to on-the-spot requests for further details to be provided in light of ‘information obtained’. Thus, although it should be ‘standard practice’ to advise firms of additional information to be provided in advance of the verification visit, this does not preclude an investigating authority from requesting ‘further details’ during the course of the investigation, ‘in light of the information obtained’. In our view, the reference to ‘information obtained’ cannot mean the information obtained from the exporter in advance of the verification visit, since (consistent with ‘standard practice’) requests regarding that information should be made prior to the visit, and not during the course of the investigation. Accordingly, the ‘information obtained’ must refer to information obtained during the course of the verification visit, since it is only information obtained during the course of a verification visit which may prompt a request for further details during the course of the verification visit. The last phrase of Annex I(7) therefore confirms our understanding that an investigating authority may seek new information during the course of the verification visit.”⁽⁷¹²⁾

(d) Disclosure obligations in the on-the-spot verification

527.   The Panel in Korea — Certain Paper, noting that Article 6.7 requires the investigating authority to inform the investigated exporters of the verification results,⁽⁷¹³⁾ found that it does not require written disclosure:

“It requires that the verification results be disclosed to the investigated exporters without specifying the format in which such disclosure is to be made … As long as it can be proved that the substantive requirements of that provision have been fulfilled, the format of the disclosure would not matter.”⁽⁷¹⁴⁾

528.   The Panel in Korea — Certain Paper noted that the purpose of the disclosure requirement under Article 6.7 is to make sure that exporters and other interested parties are informed of the verification results to be able to structure their cases for the rest of the investigation in light of those results. The Panel then went on to indicate that it is important that such disclosure contain adequate information regarding all aspects of the verification, including a description of the information which was not verified as well as of information which was verified successfully because, in its view, “information which was verified successfully, just as information which was not verified, could well be relevant to the presentation of the interested parties’ cases.”⁽⁷¹⁵⁾

(e) Participation of non-governmental experts in the on-the-spot verification

529.   In Guatemala — Cement II, Mexico claimed that a verification visit by Guatemala’s authority to the Mexican producer’s site was inconsistent with Article 6.7 and Annex I(2), (3), (7) and (8) because the authority included three non-governmental experts, two of whom the respondent considered to have a conflict of interest because they also represented the US cement industry in a US anti-dumping investigation of cement from Mexico. The Panel stated its view that an impartial and objective investigating authority would not include non-governmental experts with a conflict of interest in its verification team, but found that none of the provisions cited by Mexico explicitly prohibited such conduct.⁽⁷¹⁶⁾ The Panel also found that under these circumstances, it was entirely reasonable for the respondent producer to object to inclusion of these two experts in the verification team, and that the investigating authority could not argue that the Mexican producer’s refusal to allow the verification meant that the producer was “significantly impeding” the investigation within the meaning of Article 6.8. See also paragraph 582 below.

530.   In Guatemala — Cement II, the Panel considered that paragraph 2 of Annex I requires a national authority to directly inform the government of exporting Members of its intention to include non-governmental experts in the verification team for visit to foreign producers/ exporters.⁽⁷¹⁷⁾ With respect to the burden of proof on this point, referring to a finding of the Panel in US — Section 301 Trade Act⁽⁷¹⁸⁾, the Panel stated:

“In principle, Mexico bears the burden to prove that the Ministry failed to inform it of the inclusion of nongovernmental experts in the Ministry’s verification team. As a practical matter, this burden is impossible for Mexico to meet: one simply cannot prove that one was not informed of something. Although Mexico cannot establish definitively that it was not informed by the Ministry of the Ministry’s intention to include non-governmental experts in its verification team, there is sufficient evidence before us to suggest strongly that it was not so informed. Although an investigating authority should normally be able to demonstrate that it complied with a formal requirement to inform the authorities of another Member, Guatemala has failed to rebut the strong suggestion that it failed to do so. In fact, Guatemala has simply referred to the very letter which suggests strongly that Mexico was not notified by Guatemala.⁽⁷¹⁹⁾ In these circumstances, we do not consider that the evidence and arguments of the parties ‘remain in equipoise’. Accordingly, we find that the Ministry violated paragraph 2 of Annex I of the AD Agreement by failing to inform the Government of Mexico of the inclusion of non-governmental experts in the Ministry’s verification team.⁽⁷²⁰⁾”⁽⁷²¹⁾

531.   In Guatemala — Cement II, the Panel did not accept Mexico’s argument that under Annex I, paragraph 2, Guatemala’s authority also should have informed the Government of Mexico of the exceptional circumstances justifying the participation of the non-governmental experts in the verification team. The Panel found that the “logical conclusion from the structure” of Annex I, paragraph 2 “is that the exporting Member need only be informed of the intention to include non-governmental experts in the investigating team. If the intention of the drafters had been to impose an obligation on authorities to inform exporting Members of the ‘exceptional circumstances’ at issue, presumably the first sentence of Annex I(2) would have been drafted in a manner that clearly provided for that obligation.”⁽⁷²²⁾

7. Article 6.8 and Annex II: “facts available”

(a) General

(i) Function of Article 6.8 and Annex II

532.   In US — Hot-Rolled Steel, the Panel indicated that “[o]ne of the principal elements governing anti-dumping investigations that emerges from the whole of the AD Agreement is the goal of ensuring objective decision making based on facts. Article 6.8 and Annex II advance that goal by ensuring that even where the investigating authority is unable to obtain the “first-best” information as the basis of its decision, it will nonetheless base its decision on facts, albeit perhaps “second-best” facts.”⁽⁷²³⁾

533.   In Egypt — Steel Rebar, the Panel stated that Article 6.8 “addresses the dilemma in which investigating authorities might find themselves — they must base their calculations of normal value and export price on some data, but the necessary information may not have been submitted”. The Panel indicated that “Article 6.8 identifies the circumstances in which an [investigating authority] may overcome this lack of necessary information by relying on facts which are otherwise available to the investigating authority.”⁽⁷²⁴⁾ The Panel also concluded that it is clear that the provisions of Annex II that address what information can be used as facts available “have to do with ensuring the reliability of the information used by the investigating authority” and referred to the negotiating history of Annex II as confirmation of its conclusions:

“It is clear that the provisions of Annex II that address what information can be used as facts available (which, along with the other provisions of Annex II, ‘shall be observed’) have to do with ensuring the reliability of the information used by the investigating authority. This view may further be confirmed, as foreseen in Article 32 of the Vienna Convention on the Law of Treaties⁽⁷²⁵⁾, by the negotiating history of Annex II. In particular, this Annex was originally developed by the Tokyo Round Committee on Anti-Dumping Practices, which adopted it on 8 May 1984 as a ‘Recommendation Concerning Best Information Available in Terms of Article 6:8’.⁽⁷²⁶⁾ During the Uruguay Round negotiations, the substantive provisions of the original recommendation were incorporated with almost no changes as Annex II to the AD Agreement. A preambular paragraph to the original recommendation, which was not retained when Annex II was created, in our view, provides some insight into the intentions of the drafters concerning its application. This paragraph reads as follows:

‘The authorities of the importing country have a right and an obligation to make decisions on the basis of the best information available during the investigation from whatever source, even where evidence has been supplied by the interested party. The Anti-Dumping Code recognizes the right of the importing country to base findings on the facts available when any interested party refuses access to or does not provide the necessary information within a reasonable period, or significantly impedes the investigation (Article 6:8). However, all reasonable steps should be taken by the authorities of the importing countries to avoid the use of information from unreliable sources.’

 

To us, this preambular language conveys that the full package of provisions in the recommendation, applicable in implementing Article 6:8 of the Tokyo Round Anti-Dumping Code, was intended, inter alia, to ensure that in using facts available (i.e., in applying Article 6:8), information from unreliable sources would be avoided.”⁽⁷²⁷⁾

(ii) Relationship between Article 6.8 and Annex II

534.   In US — Hot-Rolled Steel, the Appellate Body ruled that Annex II “is incorporated by reference into Article 6.8”.⁽⁷²⁸⁾

535.   In US — Steel Plate, the Panel explained the relationship between Article 6.8 and Annex II of the Anti-Dumping Agreement and concluded that the provisions of Annex II inform the investigating authority’s evaluation whether necessary information has been provided and whether resort to facts available with respect to that element of information is justified:

“In our view, the failure to provide necessary information, that is information which is requested by the investigating authority and which is relevant to the determination to be made⁽⁷²⁹⁾, triggers the authority granted by Article 6.8 to make determinations on the basis of facts available. The provisions of Annex II, which set out conditions on the use of facts available, inform the question of whether necessary information has not been provided, by establishing considerations for when information submitted must be used by the investigating authority. Thus, the provisions of Annex II inform an investigating authority’s evaluation whether necessary information, in the sense of Article 6.8, has been provided, and whether resort to facts available with respect to that element of information is justified. If, after considering the provisions of Annex II, and in particular the criteria of paragraph 3, the conclusion is that information provided satisfies the conditions therein, the investigating authority must use that information in its determinations, and may not resort to facts available with respect to that element of information. That is, the investigating authority may not conclude, with respect to that information, that ‘necessary information’ has not been provided.”⁽⁷³⁰⁾

536.   In Egypt — Steel Rebar, the Panel considered that the cross-reference in Article 6.8 to Annex II, “[t]he provisions of Annex II shall be observed in the application of this paragraph”, indicates that Annex II applies to Article 6.8 in its entirety:

“[W]e find significant the specific wording of that cross-reference: ‘[t]he provisions of Annex II shall be observed in the application of this paragraph’ (emphasis added). In other words, the reference to ‘this paragraph’ indicates that Annex II applies to Article 6.8 in its entirety, and thus contains certain substantive parameters for the application of the individual elements of that article. The phrase ‘shall be observed’ indicates that these parameters, which address both when facts available can be used, and what information can be used as facts available, must be followed.

 

Our view of the relationship of Annex II to Article 6.8 is consistent with that of the Appellate Body in United States — Hot-Rolled Steel. In that case, the Appellate Body stated that Annex II is ‘incorporated by reference’ into Article 6.8,⁽⁷³¹⁾ i.e., that it forms part of Article 6.8.”⁽⁷³²⁾

(iii) Mandatory nature of Annex II provisions

537.   In US — Steel Plate, the Panel considered that the wording of the Article 6.8 reference to Annex II provisions establishes that the provisions of Annex II are mandatory:

“We note that there is disagreement between the parties as to whether the provisions of Annex II, which are largely phrased in the conditional tense (‘should’), are mandatory. We consider that Article 6.8 itself answers this question. Article 6.8. explicitly provides that ‘The provisions of Annex II shall be observed in the application of this paragraph’ (emphasis added). In our view, the use of the word ‘shall’ in this context establishes that the provisions of Annex II are mandatory. Indeed, this would seem a necessary conclusion. The alternative reading would mean that investigating authorities are required (‘shall’) to apply provisions which are not themselves required, an interpretation that makes no sense.⁽⁷³³⁾ Moreover, the provisions of Annex II, while worded in the conditional, give specific guidance to investigating authorities regarding certain aspects of their determinations which, without more, clearly establish the operational requirements. Thus, we consider that the provisions of Annex II are mandatory, not because of the wording of those provisions themselves, but because of the obligation to observe them set out in Article 6.8.⁽⁷³⁴⁾”⁽⁷³⁵⁾

(b) Paragraph I of Annex II

538.   The Panel in EC — Salmon (Norway) explained the obligations in Paragraph 1 of Annex II:

“Paragraph 1 of Annex II establishes two obligations on investigating authorities wanting to use ‘facts available’ in their determinations: First, they must inform any interested party of the information that must be supplied during the course of a proceeding; and secondly, the party must be made aware of the consequences of not submitting requested information, in particular, the possibility that ‘facts available’, including those presented in a complainant’s application, could be applied.”⁽⁷³⁶⁾

539.   Drawing on the Appellate Body report in Mexico — Anti-Dumping Measures on Rice, the Panel in EC — Salmon (Norway) observed that “pursuant to paragraph 1 of Annex II, an interested party must not only be informed of the information required by an investigating authority for the purpose of its investigation, but it must also be given an opportunity to provide it before the investigating authority may resort to ‘facts available’ within the meaning of Article 6.8.”⁽⁷³⁷⁾ In this case, the Panel found that to the extent the investigating authority “applied ‘facts available’ for the purpose of establishing the margin of dumping of the 33 companies that did not receive a ‘sampling questionnaire’ …we find that it acted inconsistently with paragraph 1 of Annex II and therefore also Article 6.8 of the AD Agreement.”⁽⁷³⁸⁾

(c) Authorities’ duty to “specify in detail the information required from an interested party”

(i) “as soon as possible”

540.   In Guatemala — Cement II, Mexico pointed out that paragraph 1 of Annex II requires “[a]s soon as possible after the initiation of the investigation” that the investigating authorities specify in detail the information required from interested parties. Mexico argued that, in the light of this requirement, investigating authorities are effectively precluded from extending the period of investigation during the course of the investigation. The Panel disagreed with Mexico’s argument, agreeing with Guatemala that there may be a number of circumstances in which the investigating authority will need updated information during the course of its investigation:

“We are not persuaded that paragraph 1 of Annex II, or any other provision of the AD Agreement, prevents an investigating authority from extending the POI during the course of an investigation. We agree with Guatemala that there may be a number of circumstances in which the investigating authority will need updated information during the course of its investigation. In this regard, we would also note that the extension of a POI may in certain cases lead to negative findings of dumping and/or injury, to the benefit of exporters. The fact that the POI may be extended after the imposition of provisional measures is not necessarily problematic, since even without any extension of the POI there is no guarantee that the factual basis for the preliminary determination will be the same as that of the final determination. The factual basis may change, for example, if a preliminary affirmative determination of injury is made on the basis of data provided by the complainant, and if some (or all) of that data are shown to be erroneous during verification of the domestic industry. Indeed, in such cases differences in the factual bases of the preliminary and final determinations would normally be necessary in order to preserve the integrity of the investigation. Although Annex II(1) provides that interested parties should be informed of the information required by the investigating authority ‘as soon as possible after the initiation of the investigation’, this does not mean that information concerning a particular period of time may only be required if the request for that information is made immediately after initiation. We interpret the first sentence of paragraph 1 of Annex II to mean that any request for specific information should be communicated to interested parties ‘as soon as possible’. Since Mexico has not advanced any argument that it was possible for the Ministry to have requested information concerning the extended POI before it actually did so, we reject Mexico’s claim that the Ministry’s extension of the POI violated Guatemala’s obligations under paragraph 1 of Annex II of the AD Agreement.”⁽⁷³⁹⁾

541.   In Egypt — Steel Rebar, the Panel indicated that paragraph 1 of Annex II sets forth rules to be followed by the authority, in particular that it must specify the required information “in detail”, “as soon as possible after the initiation of the investigation”, and that it also must specify “the manner in which that information should be structured by the interested party in its response”. Thus, in the Panel’s view, “there is a clear burden on the authority to be both prompt and precise in identifying the information that it needs from a given interested party”.⁽⁷⁴⁰⁾

542.   In Egypt — Steel Rebar, the investigating authorities had requested certain supplemental cost information as well as explanations concerning certain of the cost information originally submitted in response to the questionnaires. The Panel found “no basis on which to conclude that an investigating authority is precluded by paragraph 1 of Annex II or by any other provision from seeking additional information during the course of an investigation”.⁽⁷⁴¹⁾

(ii) Failure to specify in detail the information required

543.   In Argentina — Ceramic Tiles, the Panel, when analysing whether the investigating authorities were entitled to resort to facts available because of the alleged failure of a party to provide sufficient supporting documentation, considered that “a basic obligation concerning the evidence-gathering process is for the investigating authorities to indicate to the interested parties the information they require for their determination”, as set forth in Article 6.1. The Panel concluded that, “independently of the purpose for which the information or documentation is requested, an investigating authority may not fault an interested party for not providing information it was not clearly requested to submit.”⁽⁷⁴²⁾ The Panel further stated that:

“In our view, the inclusion, in an Annex relating specifically to the use of best information available under Article 6.8, of a requirement to specify in detail the information required, strongly implies that investigating authorities are not entitled to resort to best information available in a situation where a party does not provide certain information if the authorities failed to specify in detail the information which was required.

…

… we conclude that an investigating authority may not disregard information and resort to facts available under Article 6.8 on the grounds that a party has failed to provide sufficient supporting documentation in respect of information provided unless the investigating authority has clearly requested that the party provide such supporting documentation.”⁽⁷⁴³⁾

(d) When to resort to facts available

544.   In Argentina — Ceramic Tiles, the Panel enunciated the conditions under which the investigating authorities may resort to facts available:

“It is clear to us, and both parties agree, that an investigating authority may disregard the primary source information and resort to the facts available only under the specific conditions of Article 6.8 and Annex II of the AD Agreement. Thus, an investigating authority may resort to the facts available only where a party: (i) refuses access to necessary information; (ii) otherwise fails to provide necessary information within a reasonable period; or (iii) significantly impedes the investigation.”⁽⁷⁴⁴⁾

545.   In Egypt — Steel Rebar, the Panel explained that paragraphs 3 and 5 of Annex II “together … provide key elements of the substantive basis” for the investigating authority to determine whether it can resort to facts available.

“These two paragraphs together thus provide key elements of the substantive basis for an IA to determine whether it can justify rejecting respondents’ information and resorting to facts available in respect of some item, or items, of information, or whether instead, it must rely on the information submitted by respondents ‘when determinations are made’. Some of the elements referred to in these paragraphs have to do with the inherent quality of the information itself, and some have to do with the nature and quality of the interested party’s participation in the IA’s information-gathering process. Where all of the mentioned elements are satisfied, resort to facts available is not justified under Article 6.8.”⁽⁷⁴⁵⁾

546.   In Egypt — Steel Rebar, the Panel reiterated that paragraph 3 of Annex II applies to an investigating authority’s decision to use “facts available” in respect of certain elements of information and stressed that “it does not have to do with determining which particular facts available will be used for those elements of information once that decision has been made”.⁽⁷⁴⁶⁾

547.   The Appellate Body in Mexico — Anti-Dumping Duties on Rice, while recognizing that the SCM Agreement does not contain the detailed rules found in the AD Agreement, stated that it would be “anomalous” if Article 12.7 were to permit the use of facts available in a manner “markedly different” from the AD Agreement.⁽⁷⁴⁷⁾

548.   The Appellate Body in Mexico — Anti-Dumping Duties on Rice, noted that Article 6.8 of the Anti-Dumping Agreement directed agencies to engage in the “evaluative, comparative assessment” necessary in order to determine which facts are “best” to fill in the missing information.⁽⁷⁴⁸⁾

(e) When not to resort to facts available

549.   In US — Hot-Rolled Steel, the Appellate Body concluded that, according to paragraph 3 of Annex II, investigating authorities are directed to use information if three, and, in some circumstances, four, conditions are satisfied. These conditions are that the information is (i) verifiable, (ii) appropriately submitted so that it can be used in the investigation without undue difficulties, (iii) supplied in a timely fashion, and, where applicable, (iv) supplied in a medium or computer language requested by the authorities. The Appellate Body concluded that, in its view, “if these conditions are met, investigating authorities are not entitled to reject information submitted, when making a determination”.⁽⁷⁴⁹⁾

550.   In US — Steel Plate, the Panel analysed the extent of the limitation that paragraph 3 of Annex II puts on investigating authorities’ right to reject information submitted and instead resort to facts available. The Panel concluded that the “Members [do not] have an unlimited right to reject all information submitted in a case where some necessary information is not provided”:

“Paragraph 3 states that all information provided that satisfies the criteria set out in that paragraph is to be taken into account when determinations are made. We consider in this regard that the use of the final connector ‘and’ in the list of criteria makes it clear to us that an investigating authority, when making determinations, is only required to take into account information which satisfies all of the applicable criteria of Paragraph 3.⁽⁷⁵⁰⁾ In order to assess the limitations this provision puts on the right of an investigating authority to reject information submitted and instead resort to facts available,⁽⁷⁵¹⁾ we look to the ordinary meaning of the text, in its context and in light of its object and purpose. Paragraph 3 starts with the phrase ‘all information’. ‘All’ means ‘the whole amount, quantity, extent or compass of’ and ‘the entire number of, the individual constituents of, without exception…every’.⁽⁷⁵²⁾ To ‘take into account’ is defined as ‘take into consideration, notice’.⁽⁷⁵³⁾ Thus, a straightforward reading of Paragraph 3 leads to the understanding that it requires that every element of information submitted which satisfies the criteria set out therein must be considered by the investigating authority when making its determinations. If information must be considered under paragraph 3, an investigating authority may not conclude, with respect to that information, that necessary information has not been provided, in the sense of Article 6.8. Consequently, we do not accept the United States’ position that ‘information’ in Article 6.8 means all information, such that Members have an unlimited right to reject all information submitted in a case where some necessary information is not provided.

 

Of course, we do not mean to suggest that the investigating authority must, in every case, scrutinize each item of information submitted in order explicitly to determine whether it satisfies the criteria of paragraph 3 of Annex II before it uses it in its determination. Clearly, if the authority is satisfied with the information submitted, and concludes that an interested party has fully complied with the requests for information, there is no need to undertake any separate analysis under paragraph 3 of Annex II. However, to the extent the authority is not satisfied with the information submitted, it must examine those elements of information with which it is not satisfied, in light of the criteria of paragraph 3.”⁽⁷⁵⁴⁾

551.   In US — Steel Plate, the Panel further qualified its conclusions by stating that the investigating authorities were not obliged to judge each category of information separately. The Panel however indicated that the various elements, or categories, of information necessary to an anti-dumping determination are often interconnected, and a failure to provide certain information may have ramifications beyond the category into which it falls:

“[W]e also do not accept India’s view that each category of information submitted must be judged separately. India recognizes that there may be cases where a piece of information submitted which otherwise satisfies paragraph 3 is so minor an element of the information necessary to make determinations that it cannot be used in the investigation without undue difficulties, and that it is possible that so much of the information submitted in a particular ‘category’ fails to satisfy the criteria of paragraph 3, for instance, cannot be verified, that the entire category of information cannot be used without undue difficulty.

 

We consider in addition that the various elements, or categories, of information necessary to an anti-dumping determination are often interconnected, and a failure to provide certain information may have ramifications beyond the category into which it falls. For instance, a failure to provide cost of production information would leave the investigating authority unable to determine whether sales were in the ordinary course of trade, and further unable to calculate a constructed normal value. Thus, a failure to provide cost of production information might justify resort to facts available with respect to elements of the determination beyond just the calculation of cost of production. Moreover, without considering any particular ‘categories’ of information, it seems clear to us that if certain information is not submitted, and facts available are used instead, this may affect the relative ease or difficulty of using the information that has been submitted and which might, in isolation, satisfy the requirements of paragraph 3 of Annex II. However, to accept that view does not necessarily require the further conclusion, espoused by the United States, that in a case in which any ‘essential’ element of requested information is not provided in a timely fashion, the investigating authority may disregard all the information submitted and base its determination exclusively on facts available. To conclude otherwise would fly in the face of one of the fundamental goals of the AD Agreement as a whole, that of ensuring that objective determinations are made, based to the extent possible on facts.⁽⁷⁵⁵⁾

 

… In a case in which some information is rejected and facts available used instead, the … question may arise whether the fact that some information submitted was rejected has consequences for the remainder of the information submitted. In particular, the investigating authority may need to consider whether the fact that some information is rejected results in other information failing to satisfy the criteria of paragraph 3. In this context, we consider to be critical the question of whether information which itself may satisfy the criteria of paragraph 3 can be used without undue difficulties in light of its relationship to rejected information.⁽⁷⁵⁶⁾”⁽⁷⁵⁷⁾

552.   In US — Steel Plate, the Panel faced the question of whether a conclusion that some information submitted fails to satisfy the criteria of paragraph 3 of Annex II, and thus may be rejected, can in any case justify a decision to reject other information submitted which, in isolation, satisfies that criteria:

“The more difficult question, presented in this dispute, is whether a conclusion that some information submitted fails to satisfy the criteria of paragraph 3, and thus may be rejected, can in any case justify a decision to reject other information submitted which, if considered in isolation, would satisfy the criteria of paragraph 3. We consider that the answer to this question is yes, in some cases, but that the result in any given case will depend on the specific facts and circumstances of the investigation at hand.”⁽⁷⁵⁸⁾

553.   The Appellate Body in Mexico — Anti-Dumping Measures on Rice confirmed that an exporter shall be given the opportunity to provide the information required by the investigating authority before the latter resorts to facts available that can be adverse to the exporter’s interests. Because an exporter that is unknown to the investigating authority is, therefore, not notified of the information required to be submitted is denied such an opportunity, the Appellate Body concluded:

“[A]n investigating authority that uses the facts available in the application for the initiation of the investigation against an exporter that was not given notice of the information the investigating authority requires, acts in a manner inconsistent with paragraph 1 of Annex II to the Anti-Dumping Agreement and, therefore, with Article 6.8 of that Agreement.”⁽⁷⁵⁹⁾

554.   The Panel in EC — Salmon (Norway) drew support from US — Hot-Rolled Steel and US — Steel Plate in rejecting the argument that Article 6.8 “envisages the possibility that an investigating authority may rely upon information other than that submitted by an interested party in response to a specific request for information, even when the conditions for disregarding that information and using ‘facts available’ under Article 6.8 have not been established.”⁽⁷⁶⁰⁾ In the Panel’s view:

“Such a view of how Article 6.8 and Annex II are intended to operate is misconceived. In our view, it is clear from the language of Article 6.8, when read in light of paragraphs 1 and 3 of Annex II, that whenever an interested party submits specific information that an investigating authority has requested for the purpose of making a determination, and the conditions for resorting to ‘facts available’ have not been established, the investigating authority will not be entitled to disregard the submitted information and use information from another source to make the determination.”⁽⁷⁶¹⁾

555.   The Panel further stated:

“Paragraph 3 of Annex II directs investigating authorities to take all submitted information into account for the purpose of its determinations when it is: (i) ‘verifiable’; (ii) ‘appropriately submitted so that it can be used in the investigation without undue difficulties’; (iii) ‘supplied in a timely fashion’; and, where, applicable, (iv) ‘supplied in a medium or computer language requested by the authorities’. Thus, paragraph 3 of Annex II calls upon investigating authorities to take into account all information that satisfies three, or sometimes four, cumulative conditions when making determinations. It follows that where all of the conditions are satisfied, an investigating authority will not be entitled to reject information submitted when making determinations.”⁽⁷⁶²⁾

(f) Information which is “verifiable”

(i) General

556.   In Guatemala — Cement II, the Panel indicated that recourse to “best information available” should not be had when information is “verifiable”, and when “it can be used in the investigation without undue difficulties”:

“Furthermore, Annex II(3) provides that all information which is ‘verifiable’, and ‘appropriately submitted so that it can be used in the investigation without undue difficulties’, should be taken into account by the investigating authority when determinations are made. In other words, ‘best information available’ should not be used when information is ‘verifiable’, and when ‘it can be used in the investigation without undue difficulties’. In our view, the information submitted by Cruz Azul was ‘verifiable’. The fact that it was not actually verified as a result of the Ministry’s response to reasonable concerns raised by Cruz Azul does not change this. In addition, there is nothing in the Ministry’s final determination to suggest that the information submitted by Cruz Azul could not be used in the investigation ‘without undue difficulties’. Since the information was ‘verifiable’, and since the Ministry did not demonstrate that it could not be used ‘without undue difficulties’, Annex II(3) provides strong contextual support for the above conclusion that the Ministry violated Article 6.8 in using the ‘best information available’ as a result of the cancelled verification visit.”⁽⁷⁶³⁾

(ii) When is information verifiable?

557.   In US — Steel Plate, the Panel considered that the information is “verifiable” when “the accuracy and reliability of the information can be assessed by an objective process of examination” and that this process does not require an on-the-spot verification. In a footnote to its report, the Panel stated:

“While the parties have addressed this concept in terms of the ‘on-the-spot’ verification process provided for in Article 6.7 and Annex I of the Agreement, we note that such verification is not in fact required by the AD Agreement. Thus, the use of the term in paragraph 3 of Annex II is somewhat unclear. However, Article 6.6 establishes a general requirement that, unless they are proceeding under Article 6.8 by relying on facts available, the authorities shall ‘satisfy themselves as to the accuracy supplied by interested parties upon which their findings are based’. ‘Verify’ is defined as ‘ascertain or test the accuracy or correctness of, esp. by examination or by comparison of data etc.; check or establish by investigation’. New Shorter Oxford English Dictionary, Clarendon Press, Oxford, 1993. Thus, even in the absence of on-the-spot verification, the authorities are, in a more general sense of assessing the accuracy of information relied upon, required to base their decisions on information which is ‘verified’.”⁽⁷⁶⁴⁾

 

The Panel on European Communities — Anti-Dumping Measure on Farmed Salmon from Norway considered that “the possibility of undertaking on-the-spot investigations cannot alone be determinative of the question whether submitted information is ‘verifiable’…. in our view, this [whether information is verifiable or not] must be a conclusion reached on the basis of a case-by-case assessment of the particular facts at issue, including not only the nature of the information submitted but also the steps, if any, taken by the investigating authority to assess the accuracy and reliability of the information.”⁽⁷⁶⁵⁾

558.   The Panel in Mexico — Steel Pipes and Tubes considered arguments raised by Guatemala concerning both substantive and procedural points in relation to the use of facts available. One of the major issues in this case was whether, on the basis of the record evidence, an “unbiased and objective investigating authority could have reached the conclusion that the nature and number of problems encountered at verification were so significant that none of Tubac’s data [the only identified exporter]… could be used.”⁽⁷⁶⁶⁾ Ultimately the Panel was not convinced that Mexico’s investigating authority had complied with its substantive obligations under Article 6.8 and Annex II. See paragraphs 577–579 below.

(iii) Relevance of good faith cooperation

559.   In Egypt — Steel Rebar, the Panel considered that, pursuant to paragraphs 3 and 5 of Annex II, if read together⁽⁷⁶⁷⁾, “information that is of a very high quality, although not perfect, must not be considered unverifiable solely because of its minor flaws, so long as the submitter has acted to the best of its ability. That is, so long as the level of good faith cooperation by the interested party is high, slightly imperfect information should not be dismissed as unverifiable.”⁽⁷⁶⁸⁾

(g) Information “appropriately submitted so that it can be used in the investigation without undue difficulties”

560.   In US — Steel Plate, the Panel considered that the question of whether information submitted can be used in the investigation “without undue difficulties” is a highly fact-specific issue. It thus concluded that the investigating authority must explain, as required by paragraph 6 of Annex II, the basis of a conclusion that information which is verifiable and timely submitted cannot be used in the investigation without undue difficulties:

“The second criterion of paragraph 3 requires that the information be ‘appropriately submitted so that it can be used in the investigation without undue difficulties’. In our view, ‘appropriately’ in this context has the sense of ‘suitable for, proper, fitting’.⁽⁷⁶⁹⁾ That is, the information is suitable for the use of the investigating authority in terms of its form, is submitted to the correct authorities, etc. More difficult is the requirement that the information can be ‘used without undue difficulties’. ‘Undue’ is defined as ‘going beyond what is warranted or natural, excessive, disproportionate’.⁽⁷⁷⁰⁾ Thus, ‘undue difficulties’ are difficulties beyond what is otherwise the norm in an antidumping investigation. This recognizes that difficulties in using the information submitted in an anti-dumping investigation are not, in fact, unusual. This conclusion is hardly surprising, given that enterprises that become interested parties in an anti-dumping investigation and are asked to provide information are not likely to maintain their internal books and records in exactly the format and with precisely the items of information that are eventually requested in the course of an anti-dumping investigation. Thus, it is frequently necessary for parties submitting information to collect and organize raw data in a form that responds to the information request of the investigating authorities. Similarly, it is frequently necessary for the investigating authority to make adjustments of its own in order to be able to take into account information that does not fully comply with its request. This is part of the obligation on both sides to cooperate, recognized by the Appellate Body in the US — Hot-Rolled Steel case.⁽⁷⁷¹⁾

…

In our view, it is not possible to determine in the abstract what ‘undue difficulties’ might attach to an effort to use information submitted. We consider the question of whether information submitted can be used in the investigation ‘without undue difficulties’ is a highly fact-specific issue. Thus, we consider that it is imperative that the investigating authority explain, as required by paragraph 6 of Annex II, the basis of a conclusion that information which is verifiable and timely submitted cannot be used in the investigation without undue difficulties.”⁽⁷⁷²⁾

561.   The Panel in Argentina — Poultry Anti-Dumping Duties considered that “the reference to the terms ‘appropriately submitted’ is designed to cover inter alia information which is submitted in accordance with relevant procedural provisions of WTO Members’ domestic laws”⁽⁷⁷³⁾:

“In our view, paragraph 3 of Annex II to the AD Agreement can be interpreted to mean that information not ‘appropriately submitted’ in accordance with relevant procedural provisions of WTO Members’ domestic laws may be disregarded. In the circumstances of this case, we consider that information submitted by Catarinense was not ‘appropriately submitted’ within the meaning of paragraph 3 of Annex II to the AD Agreement because Catarinense had not complied with Argentina’s accreditation requirements. Accordingly, the DCD was entitled to reject that information.”⁽⁷⁷⁴⁾

562.   The Panel in EC — Salmon (Norway) did not see how the “mere fact” that information was submitted after an on-the-spot investigation would necessarily mean that the information could not be used without “undue difficulties”. The Panel acknowledged that while the extent of the effort needed to assess the accuracy and reliability of information, especially if submitted at a late stage of the investigation, may play a role in determining whether it could be used, in the case before the Panel the facts indicated no efforts had been made on the part of the investigating authority to “attempt to even explore the feasibility and/or practicality of any other verification options.”⁽⁷⁷⁵⁾ Therefore, the Panel found there was an insufficient basis for the investigating authority to conclude that information submitted was not “appropriately submitted”.⁽⁷⁷⁶⁾

(h) Necessary information submitted in a timely fashion

(i) Timeliness

563.   The Appellate Body in US — Hot-Rolled Steel concluded that paragraph 3 of Annex II directs investigating authorities not to reject information submitted by the parties if this is submitted “in a timely fashion” and interpreted this as a “reference to a ‘reasonable period’ of Article 6.8 or a ‘reasonable time’ of paragraph 1 of Annex II” (see paragraphs 568–570 below). The Appellate Body also refers to Article 6.1.1, second sentence which requires investigating authorities to extend deadlines “upon cause shown”, if “practicable”:

“[A]ccording to paragraph 3 of Annex II, investigating authorities are directed to use information if three, and, in some circumstances, four, conditions are satisfied. In our view, it follows that if these conditions are met, investigating authorities are not entitled to reject information submitted, when making a determination. One of these conditions is that information must be submitted ‘in a timely fashion’.

 

The text of paragraph 3 of Annex II of the Anti-Dumping Agreement is silent as to the appropriate measure of ‘timeliness’ under that provision. In our view, ‘timeliness’ under paragraph 3 of Annex II must be read in light of the collective requirements, in Articles 6.1.1 and 6.8, and in Annex II, relating to the submission of information by interested parties. Taken together, these provisions establish a coherent framework for the treatment, by investigating authorities, of information submitted by interested parties. Article 6.1.1 establishes that investigating authorities may fix time-limits for responses to questionnaires, but indicates that, ‘upon cause shown’, and if ‘practicable’, these time-limits are to be extended. Article 6.8 and paragraph 1 of Annex II provide that investigating authorities may use facts available only if information is not submitted within a reasonable period of time, which, in turn, indicates that information which is submitted in a reasonable period of time should be used by the investigating authorities.

 

That being so, we consider that, under paragraph 3 of Annex II, investigating authorities should not be entitled to reject information as untimely if the information is submitted within a reasonable period of time. In other words, we see, ‘in a timely fashion’, in paragraph 3 of Annex II as a reference to a ‘reasonable period’ or a ‘reasonable time’. This reading of ‘timely’ contributes to, and becomes part of, the coherent framework for fact-finding by investigating authorities. Investigating authorities may reject information under paragraph 3 of Annex II only in the same circumstances in which they are entitled to overcome the lack of this information through recourse to facts available, under Article 6.8 and paragraph 1 of Annex II of the Anti-Dumping Agreement. The coherence of this framework is also secured through the second sentence of Article 6.1.1, which requires investigating authorities to extend deadlines ‘upon cause shown’, if ‘practicable’. In short, if the investigating authorities determine that information was submitted within a reasonable period of time, Article 6.1.1 calls for the extension of the time-limits for the submission of information.”⁽⁷⁷⁷⁾

(ii) “necessary information”

564.   In Egypt — Steel Rebar, the Panel examined the concept of “necessary information” in the sense of Article 6.8 and stressed that “Article 6.8 refers to ‘necessary’ information, and not to ‘required’ or ‘requested’ information”. Since Article 6.8 itself does not define the concept of “necessary” information, the Panel considered whether there is guidance on this point anywhere else in the Anti-Dumping Agreement, in particular in Annex II, given Article 6.8’s explicit cross-reference to it.⁽⁷⁷⁸⁾ The Panel concluded that, subject to the requirements of Annex II, paragraph 1, it is left to the discretion of the investigating authority to specify what information is “necessary” in the sense of Article 6.8:

“On the question of the ‘necessary’ information, reading Article 6.8 in conjunction with Annex II, paragraph 1, it is apparent that it is left to the discretion of an investigating authority, in the first instance, to determine what information it deems necessary for the conduct of its investigation (for calculations, analysis, etc.), as the authority is charged by paragraph 1 to ‘specify … the information required from any interested party’. This paragraph also sets forth rules to be followed by the authority, in particular that it must specify the required information ‘in detail’, ‘as soon as possible after the initiation of the investigation’, and that it also must specify ‘the manner in which that information should be structured by the interested party in its response’. Thus, there is a clear burden on the authority to be both prompt and precise in identifying the information that it needs from a given interested party …”⁽⁷⁷⁹⁾

565.   In Egypt — Steel Rebar, Turkey had claimed that because the basis for initially questioning and then rejecting Turkish respondents’ costs was unfounded, resort to facts available by the investigating authorities was unjustified under Article 6.8 of the Agreement. Egypt argued that its investigating authority was not in a position to make this determination because the required information to enable it to make the determination was not submitted by the respondents in their responses to the initial questionnaire. The Panel considered that, “[o]n its face, this justification for seeking the detailed cost information appears plausible to us, given, as noted, that a below-cost test is explicitly provided for in Articles 2.2 and 2.2.1 of the AD Agreement”. The Panel thus concluded that “the requested information would seem[ed] to be ‘necessary’ in the sense of Article 6.8”.⁽⁷⁸⁰⁾

566.   In Korea — Certain Paper, the Panel considered what constitutes “necessary information” within the meaning of Article 6.8:

“[T]he decision as to whether or not a given piece of information constitutes ‘necessary information’ within the meaning of Article 6.8 has to be made in light of the specific circumstances of each investigation, not in the abstract. A particular piece of information that may play a critical role in an investigation may not be equally relevant in another one.”⁽⁷⁸¹⁾

(iii) Information submitted after a deadline

567.   In US — Hot-Rolled Steel, the United States authorities had rejected certain information provided by two Japanese companies which was submitted beyond the deadlines for responses to the questionnaires and thus applied “facts available” in the calculation of the dumping margins. The United States interpreted Article 6.8 as permitting investigating authorities to rely upon reasonable, pre-established deadlines for the submission of data and that this is supported by Article 6.1.1. The Appellate Body, although it upheld the Panel’s finding that the United States had infringed Article 6.8 by rejecting that information and applying best facts available, did so following a different line of reasoning.⁽⁷⁸²⁾ As regards the Appellate Body’s interpretation of Article 6.1.1 in this context, see paragraph 442 above. The Appellate Body considered that deadlines are indeed relevant in determining whether information had been submitted within a reasonable period of time but that a balance needs to be made between the rights of the investigating authorities to control and expedite the investigation and the legitimate interest of the parties to submit information and to have it taken into account:

“In determining whether information is submitted within a reasonable period of time, it is proper for investigating authorities to attach importance to the time-limit fixed for questionnaire responses, and to the need to ensure the conduct of the investigation in an orderly fashion. Article 6.8 and paragraph 1 of Annex II are not a license for interested parties simply to disregard the time-limits fixed by investigating authorities.⁽⁷⁸³⁾ Instead, Articles 6.1.1 and 6.8, and Annex II of the Anti-Dumping Agreement, must be read together as striking and requiring a balance between the rights of the investigating authorities to control and expedite the investigating process, and the legitimate interests of the parties to submit information and to have that information taken into account.”⁽⁷⁸⁴⁾

(iv) “within a reasonable period” and “within reasonable time”

568.   In US — Hot-Rolled Steel, the Appellate Body looked into the issue of when investigating authorities are entitled to reject information submitted by the parties after a deadline established by the investigating authorities, and instead resort to facts available, as the United States did in this case. The Appellate Body considered that when information is provided “within a reasonable period of time” as mandated by Article 6.8, the investigating authorities cannot resort to best facts available:

“Article 6.8 identifies the circumstances in which investigating authorities may overcome a lack of information, in the responses of the interested parties, by using ‘facts’ which are otherwise ‘available’ to the investigating authorities. According to Article 6.8, where the interested parties do not ‘significantly impede’ the investigation, recourse may be had to facts available only if an interested party fails to submit necessary information ‘within a reasonable period’. Thus, if information is, in fact, supplied ‘within a reasonable period’, the investigating authorities cannot use facts available, but must use the information submitted by the interested party.”⁽⁷⁸⁵⁾

569.   The Appellate Body in US — Hot-Rolled Steel also drew from paragraph 1 of Annex II to support its conclusion that investigating authorities may resort to facts available only “if information is not supplied within a reasonable time”:

“Although […] paragraph [1 of Annex II] is specifically concerned with ensuring that respondents receive proper notice of the rights of the investigating authorities to use facts available, it underscores that resort may be had to facts available only ‘if information is not supplied within a reasonable time’. Like Article 6.8, paragraph 1 of Annex II indicates that determinations may not be based on facts available when information is supplied within a ‘reasonable time’ but should, instead, be based on the information submitted.”⁽⁷⁸⁶⁾

570.   As regards the meaning of “reasonable period” under Article 6.8 and “reasonable time” under paragraph 1 of Annex II, the Appellate Body in US — Hot-Rolled Steel considered that both concepts should be approached on a case-by-case basis “in the light of the specific circumstances of each investigation”:

“The word ‘reasonable’ implies a degree of flexibility that involves consideration of all of the circumstances of a particular case. What is ‘reasonable’ in one set of circumstances may prove to be less than ‘reasonable’ in different circumstances. This suggests that what constitutes a reasonable period or a reasonable time, under Article 6.8 and Annex II of the Anti-Dumping Agreement, should be defined on a case-by-case basis, in the light of the specific circumstances of each investigation.

 

In sum, a ‘reasonable period’ must be interpreted consistently with the notions of flexibility and balance that are inherent in the concept of ‘reasonableness’, and in a manner that allows for account to be taken of the particular circumstances of each case. In considering whether information is submitted within a reasonable period of time, investigating authorities should consider, in the context of a particular case, factors such as: (i) the nature and quantity of the information submitted; (ii) the difficulties encountered by an investigated exporter in obtaining the information; (iii) the verifiability of the information and the ease with which it can be used by the investigating authorities in making their determination; (iv) whether other interested parties are likely to be prejudiced if the information is used; (v) whether acceptance of the information would compromise the ability of the investigating authorities to conduct the investigation expeditiously; and (vi) the numbers of days by which the investigated exporter missed the applicable time-limit.”⁽⁷⁸⁷⁾

571.   The Panel in Korea — Certain Paper followed the approach above in examining the issue of “reasonable period” within the meaning of Article 6.8 and the relevance of missing a deadline for the submission of information in an anti-dumping investigation.⁽⁷⁸⁸⁾

(i) Information submitted in the medium or computer language requested

572.   In US — Steel Plate, the Panel referred to this fourth criterion of paragraph 3 of Annex II but it did not consider it further because it seemed to it to be straightforward and it was not in dispute in this case.⁽⁷⁸⁹⁾

(j) Non-cooperation: “refuse access to, or otherwise does not provide”

(i) Meaning of cooperation

573.   In US — Hot-Rolled Steel, the United States authorities had resorted to “adverse”⁽⁷⁹⁰⁾ facts available to calculate the dumping margins of an exporter who had failed to cooperate by not providing certain data by failing to provide certain data as requested. The Appellate Body, which upheld the Panel’s finding to the effect that the authorities’ conclusion that the exporter failed to “cooperate” in the investigation “did not rest on a permissible interpretation of that word”⁽⁷⁹¹⁾, had looked into the meaning of cooperation under paragraph 7 of Annex II. The Appellate Body considered that cooperation is a process which is “in itself not determinative of the end result of the cooperation”:

“Paragraph 7 of Annex II indicates that a lack of ‘cooperation’ by an interested party may, by virtue of the use made of facts available, lead to a result that is ‘less favourable’ to the interested party than would have been the case had that interested party cooperated. We note that the Panel referred to the following dictionary meaning of ‘cooperate’: to ‘work together for the same purpose or in the same task.’⁽⁷⁹²⁾ This meaning suggests that cooperation is a process, involving joint effort, whereby parties work together towards a common goal. In that respect, we note that parties may very well ‘cooperate’ to a high degree, even though the requested information is, ultimately, not obtained. This is because the fact of ‘cooperating’ is in itself not determinative of the end result of the cooperation. Thus, investigating authorities should not arrive at a ‘less favourable’ outcome simply because an interested party fails to furnish requested information if, in fact, the interested party has ‘cooperated’ with the investigating authorities, within the meaning of paragraph 7 of Annex II of the Anti-Dumping Agreement.”⁽⁷⁹³⁾

(ii) Degree of cooperation: “to the best of its ability”

574.   The Appellate Body in US — Hot-Rolled Steel, when analysing the concept of cooperation under paragraph 7 of Annex II, noted that this provision does not indicate the degree of cooperation which is expected from interested parties to avoid the possibility of the investigating authorities resorting to a “less favourable” result. The Appellate Body considered that, on the basis of the wording of paragraph 5 of Annex II, the degree of cooperation required is to cooperate to the “best” of their abilities”. The Appellate Body also draws from paragraph 2 of Annex II that maintaining the principle of good faith requires a balance to be struck by the investigating authorities between the effort that they can expect interested parties to make in responding to questionnaires, and the practical ability of those interested parties to comply fully with all demands made of them by the investigating authorities:

“Paragraph 7 of Annex II does not indicate what degree of ‘cooperation’ investigating authorities are entitled to expect from an interested party in order to preclude the possibility of such a ‘less favourable’ outcome. To resolve this question we scrutinize the context found in Annex II. In this regard, we consider it relevant that paragraph 5 of Annex II prohibits investigating authorities from discarding information that is ‘not ideal in all respects’ if the interested party that supplied the information has, nevertheless, acted ‘to the best of its ability’. (emphasis added) This provision suggests to us that the level of cooperation required of interested parties is a high one — interested parties must act to the ‘best’ of their abilities.

 

We note, however, that paragraph 2 of Annex II authorizes investigating authorities to request responses to questionnaires in a particular medium(for example, computer tape) but, at the same time, states that such a request should not be ‘maintained’ if complying with that request would impose an ‘unreasonable extra burden ‘ on the interested party, that is, would ‘entail unreasonable additional cost and trouble’. (emphasis added) This provision requires investigating authorities to strike a balance between the effort that they can expect interested parties to make in responding to questionnaires, and the practical ability of those interested parties to comply fully with all demands made of them by the investigating authorities. We see this provision as another detailed expression of the principle of good faith, which is, at once, a general principle of law and a principle of general international law, that informs the provisions of the Anti-Dumping Agreement, as well as the other covered agreements.⁽⁷⁹⁴⁾ This organic principle of good faith, in this particular context, restrains investigating authorities from imposing on exporters burdens which, in the circumstances, are not reasonable.”⁽⁷⁹⁵⁾

575.   In US — Steel Plate, India had argued that even if information submitted fails to satisfy the criteria of paragraph 3 of Annex II to some degree, if the party submitting that information acted to the best of its ability, the investigating authority is required under paragraph 5 of Annex II to make “more concerted efforts” to use it. The Panel did not agree with India:

“Paragraph 5 establishes that information provided which is not ideal is not to be disregarded if the party submitting it has acted to the best of its ability. As the Appellate Body found in US — Hot-Rolled Steel, the degree of effort demanded of interested parties by this provision is significant.⁽⁷⁹⁶⁾ We are somewhat troubled by the implications of India’s view of this provision, which might be understood to require that information which fails to satisfy the criteria of paragraph 3, and therefore need not be taken into account when determinations are made, must nonetheless ‘not be disregarded’ if the party submitting it has acted to the best of its ability. We find it difficult to conclude that an investigating authority must use information which is, for example, not verifiable, or not submitted in a timely fashion, or regardless of the difficulties incumbent upon its use, merely because the party supplying it has acted to the best of its ability. This would seem to undermine the recognition that the investigating authority must be able to complete its investigation and must make determinations based to the extent possible on facts, the accuracy of which has been established to the authority’s satisfaction.

 

However, if we understand paragraph 5 to emphasize the obligation on the investigating authority to cooperate with interested parties, and particularly to actively make efforts to use information submitted if the interested party has acted to the best of its ability, we believe that it does not undo the framework for use of information submitted and resort to facts available set out in the AD Agreement overall. Similarly, paragraph 5 can be understood to highlight that information that satisfies the requirements of paragraph 3, but which is not perfect, must nonetheless not be disregarded.”⁽⁷⁹⁷⁾

576.   In Egypt — Steel Rebar, the Panel considered that the phrase “acted to the best of its ability” in paragraph 5 of Annex II does not exist in isolation, either from other paragraphs of Annex II or from Article 6.8 itself. The Panel indicated that “this is because an interested party’s level of effort to submit certain information does not necessarily have anything to do with the substantive quality of the information submitted”:

“[P]aragraph 5 [of Annex II] does not exist in isolation, either from other paragraphs of Annex II, or from Article 6.8 itself. Nor, a fortiori, does the phrase ‘acted to the best of its ability’. In particular, even if, with the best possible intentions, an interested party has acted to the very best of its ability in seeking to comply with an investigating authority’s requests for information, that fact, by itself, would not preclude the investigating authority from resorting to facts available in respect of the requested information. This is because an interested party’s level of effort to submit certain information does not necessarily have anything to do with the substantive quality of the information submitted, and in any case is not the only determinant thereof. We recall that the Appellate Body, in US — Hot-Rolled Steel, recognized this principle (although in a slightly different context), stating that ‘parties may very well ‘cooperate’ to a high degree, even though the requested information is, ultimately, not obtained. This is because the fact of ‘cooperating’ is in itself not determinative of the end result of the cooperation.⁽⁷⁹⁸⁾”⁽⁷⁹⁹⁾

577.   The Panel in Mexico — Steel Pipes and Tubes took the same approach as the Panel in Egypt — Steel Rebar in considering that paragraphs 3 and 5 of Annex II together “set forth the substantive elements for a justified decision to reject a party’s information and resort to facts available.”⁽⁸⁰⁰⁾ The Panel elaborated further on the jurisprudence in considering whether it was appropriate to use facts available:

“We also note that the Appellate Body’s ruling in US — Hot-Rolled Steel is consistent with that approach [i.e. paragraphs 3 and 5 of Annex II outline the substantive elements necessary to reject a party’s information and resort to facts available], in that the Appellate Body ruled that investigating authorities ‘are not entitled to reject information submitted’ if that information meets the conditions in paragraph 3 of being ‘verifiable’, ‘appropriately submitted so that it can be used without undue difficulties’, and ‘supplied in a timely fashion’. The Panel in US — Steel Plate considered that information is verifiable when ‘the accuracy and reliability of the information can be assessed by an objective process of examination’. That Panel also found that the term ‘undue difficulties’ are difficulties ‘beyond what is otherwise the norm in an anti-dumping investigation’, and that an investigating authority is required by paragraph 6 of Annex II ‘to explain the basis of a conclusion that information which is verifiable and timely submitted cannot be used in the investigation without undue difficulties.’ Finally, we note in connection with this claim the Panel’s characterization as a case-by-case question whether a conclusion that some information fails to satisfy the criteria of paragraph 3 and thus may be rejected can justify the rejection of other information that would, in isolation, have satisfied the criteria of paragraph 3, as we view this as an important element of Mexico’s argument.”

578.   The Panel in Mexico — Steel Pipes and Tubes considered the investigating authority’s justification in resorting to facts available in light of the evidence on the record, and was not convinced by its arguments. The Panel’s comments on product scope shed light on its overall view of the investigating authority’s conduct of the investigation:

“Concerning the product scope of the data submitted by Tubac, given our finding that the record indicates that Economía faulted Tubac for having provided data only on A-53 and BS-1387 pipe, we consider whether there is factual evidence that Economía ever specifically requested any pricing data from Tubac (such as would be necessary to calculate dumping margins) on products other than these, either in the questionnaire or at any point thereafter. We find no record evidence of any such request, nor does Mexico argue that any such request was made. In this context we emphasize that whatever issues there may have been at various points during the investigation regarding product scope (and we note Tubac’s requests for clarification on this point from the very outset of the investigation), the facts of record show that Tubac was fully transparent throughout the investigation as to the scope of the products for which it reported data and its reasons for doing so. There is no evidence to the contrary, and indeed Mexico confirmed Tubac’s transparency in this regard in response to questioning by the Panel. Nor did Economía, before the final phase of the investigation, raise any issue in this respect. To the contrary, Economía itself on numerous occasions confirmed the correctness of the scope of the data provided by Tubac, including during the technical meeting with Hylsa and at verification (where the verification team at several points identified Tubac’s product codes that were covered by the investigation). Thus the evidence is unequivocal that Economía was fully aware of the product scope of the data provided by Tubac, and never identified to Tubac that there was any problem in this regard, or sought data on other products.”⁽⁸⁰¹⁾

579.   The Panel in Mexico — Steel Pipes and Tubes concluded that the record evidence did not support a conclusion that the data submitted by Tubac [the only identified exporter] was unverifiable in the sense of paragraph 3 of Annex II.

580.   In Egypt — Steel Rebar, the Panel looked at the dictionary meaning of the phrase to the “best” of an interested party’s ability:

“Considering in more detail the concrete meaning of the phrase to the ‘best’ of an interested party’s ability, we note that the Concise Oxford Dictionary defines the expression ‘to the best of one’s ability’ as ‘to the highest level of one’s capacity to do something’ (emphasis added). In similar vein, the Shorter Oxford Dictionary defines this phrase as ‘to the furthest extent of one’s ability; so far as one can do’. We note that in a legal context, the concept of ‘best endeavours’, is often juxtaposed with the concept of ‘reasonable endeavours’ in defining the degree of effort a party is expected to exert. In that context, ‘best endeavours’ connotes efforts going beyond those that would be considered ‘reasonable’ in the circumstances. We are of the opinion that the phrase the ‘best’ of a party’s ability in paragraph 5 connotes a similarly high level of effort.”⁽⁸⁰²⁾

581.   The Panel in Mexico — Steel Pipes and Tubes found in favour of Guatemala’s claim that the exporter in question, Tubac, had acted to the best of its ability and that the investigating authority in Mexico, in rejecting the information provided had acted inconsistently with paragraph 5 of Annex II.

“In short, Mexico’s argument before us on this point seems to be a post hoc explanation of Economía’s decision to reject Tubac’s data, which neither appears in Economía’s Final Determination nor finds factual support in the record evidence underlying that Determination…

 

As for the question of whether the record otherwise contains any evidence that Tubac acted in a deliberately misleading manner in terms of the data it provided in its questionnaire response, at verification, or at any other point, we see none, and Mexico points to none. Indeed, given that according to the verification report Tubac itself brought certain errors in its data base to the attention of the verification team, and otherwise is described in that report as providing all data and documentation requested by the verification team without delays or other problems, we consider that an unbiased and objective investigating authority could not conclude on the basis of the verification report that Tubac had failed to cooperate in the manner asserted by Mexico As a result, we also find no basis in the record for Mexico’s assertion that Tubac significantly impeded the investigation.”⁽⁸⁰³⁾

(iii) Justification for non-cooperation

582.   In Guatemala — Cement II, the Panel examined whether Guatemala’s authority had made recourse to the “best information available” in compliance with Article 6.8. In rejecting Guatemala’s argument that the Mexican producer concerned significantly impeded the investigation of the authority by failing to cooperate with the authority’s verification visit to its premises, the Panel found that the objection of the Mexican producer to the verification visit was reasonable:

“[W]e do not consider that an objective and impartial investigating authority could properly have found that Cruz Azul significantly impeded its investigation by objecting to the inclusion of non-governmental experts with a conflict of interest in its verification team. We do not consider that a failure to cooperate necessarily constitutes significant impediment of an investigation, since in our view the AD Agreement does not require cooperation by interested parties at any cost. Although there are certain consequences (under Article 6.8) for interested parties if they fail to cooperate with an investigating authority, in our view such consequences only arise if the investigating authority itself has acted in a reasonable, objective and impartial manner. In light of the facts of this case, we find that the Ministry did not act in such a manner.”⁽⁸⁰⁴⁾

(iv) Cooperation as a two-way process

583.   The Appellate Body in US — Hot-Rolled Steel also considered that both paragraphs 2 and 5 of Annex II and Article 6.13 of the Anti-Dumping Agreement call for a “balance between the interests of investigating authorities and exporters” and therefore see “cooperation” as “a two way process involving joint effort”:

“We, therefore, see paragraphs 2 and 5 of Annex II of the Anti-Dumping Agreement as reflecting a careful balance between the interests of investigating authorities and exporters. In order to complete their investigations, investigating authorities are entitled to expect a very significant degree of effort — to the ‘best of their abilities’ — from investigated exporters. At the same time, however, the investigating authorities are not entitled to insist upon absolute standards or impose unreasonable burdens upon those exporters.

 

Article 6.13 thus underscores that ‘cooperation’ is, indeed, a two-way process involving joint effort. This provision requires investigating authorities to make certain allowances for, or take action to assist, interested parties in supplying information. If the investigating authorities fail to ‘take due account’ of genuine ‘difficulties’ experienced by interested parties, and made known to the investigating authorities, they cannot, in our view, fault the interested parties concerned for a lack of cooperation.”⁽⁸⁰⁵⁾

(k) Information used in case of resorting to facts available

(i) “secondary source … with special circumspection”

584.   In Egypt — Steel Rebar, Egypt resorted to facts available in the calculation of the cost of production and constructed value of a Turkish company concerned. In particular, Egypt had added 5 per cent for inflation to that company’s reported costs when constructing its normal value. Turkey claimed that the addition of 5 per cent was arbitrary and, as information from a “secondary source”, should have been used with “special circumspection”, and in particular, should have been “check[ed] … from other independent sources at [the investigating authority’s] disposal”. The Panel rejected Turkey’s claim and emphasized:

“[A]pplying ‘special circumspection’ does not mean that only one outcome is possible on a given point in an investigation. Rather, even while using special circumspection, an investigating authority may have a number of equally credible options in respect of a given question. In our view, when no bias or lack of objectivity is identified in respect of the option selected by an investigating authority, the option preferred by the complaining Member cannot be preferred by a panel.”⁽⁸⁰⁶⁾

585.   Regarding the exercise by the investigating authority of special circumspection in light of paragraph 7 of Annex II, the Panel in Korea — Certain Paper recognized that an investigating authority is under the obligation to corroborate information obtained from secondary sources:

“The fact remains, however, that KTC was under the obligation to take the procedural step, under paragraph 7 of Annex II, to confirm the reliability of that information for purposes of its determinations in the investigation.”⁽⁸⁰⁷⁾

586.   On the matter of exercise by the investigating authority of special circumspection in its use of information from secondary sources under paragraph 7 of Annex II, the Panel in Korea — Certain Paper explained that the investigation authority is not restricted in its use of information from a secondary source and that it would not be inconsistent with the IA’s obligation to apply special circumspection if it decides to use information relating to another company, which KTC did in the context of calculating the normal values because it did not have information regarding financial and SG&A expenses for one of the investigated companies.⁽⁸⁰⁸⁾ It further concluded that:

“Notwithstanding our observation that the activities carried out by these two types of companies would normally be different from one another, we do not exclude the possibility that — in a given investigation — using the information relating to these companies for one another may be allowed provided that the reasons for that course of action are adequately explained in the IA’s determinations.”⁽⁸⁰⁹⁾

587.   With respect to the facts that an agency may use when faced with missing information, the Appellate Body in Mexico — Anti-Dumping Measures on Rice agreed with the Panel, explaining that:

“[T]he agency’s discretion is not unlimited. First, the facts to be employed are expected to be the ‘best information available’… . Secondly, when culling necessary information from secondary sources, the agency should ascertain for itself the reliability and accuracy of such information by checking it, where practicable, against information contained in other independent sources at its disposal, including material submitted by interested parties. Such an active approach is compelled by the obligation to treat data obtained from secondary sources ‘with special circumspection’.”⁽⁸¹⁰⁾

588.   In the compliance proceedings on Korea — Certain Paper (Article 21.5 — Indonesia), Indonesia argued that the investigating authority (KTC) failed to comply with its obligations under Article 6.8 and paragraph 7 of Annex II of the Anti-Dumping Agreement. It was undisputed that verification data of PT Cakrawala Mega Indah (CMI) (the trading company that sold Indonesia the subject product) was not allowed in the original investigation and that recourse to facts available was justified under Article 6.8. But, in this compliance proceeding the dispute was whether the KTC complied with the requirements of paragraph 7 of Annex II in its selection of information from secondary sources to replace the missing information.⁽⁸¹¹⁾ The Panel in Korea — Certain Paper (Article 21.5 — Indonesia) noted that the KTC’s redetermination regarding CMIs financial expenses differed from the original determination in two main regards which it needed to assess for compliance with paragraph 7 of Annex II: (i) whether using the interest expenses of a manufacturer as proxy for CMI would be appropriate (the KTC concluded that it was); and (ii) whether it was proper that the KTC corroborated the interest rate used for CMI with the interest rates pertaining to certain other companies.⁽⁸¹²⁾ The KTC, after using RAK’s interest rate (RAK was a subsidiary of April Fine, an Indonesian exporter) as proxy for CMI, compared it against various sources and concluded that the interest rate used for CMI was proper.

589.   Regarding the first point, the Panel in Korea — Certain Paper (Article 21.5 — Indonesia) found that the KTC’s establishment of the facts regarding the scope of CMI’s business was not proper. The Panel noted this finding of the KTC was made in the context of the broader issue of whether it would be appropriate to use a manufacturing company’s interest expenses for CMI. The Panel therefore found that the KTC had failed to exercise special circumspection within the meaning of paragraph 7 of Annex II.⁽⁸¹³⁾

590.   In relation to the second point, the Panel in Korea — Certain Paper (Article 21.5 — Indonesia) was concerned at the lack of an adequate explanation regarding the use of interest expenses, and concluded that the KTC had also acted inconsistently with Article 6.8 and paragraph 7 of Annex II in this regard:

“We do not consider that there are strict rules that the investigating authorities have to follow in determining the financial expenses of different kinds of companies on the basis of facts available. In the circumstances of the implementation proceedings at issue, however, we find it noteworthy that the KTC used April Fine’s data to determine all of CMI’s SG&A expenses except interest expenses for which it used the data pertaining to RAK. We do not consider that this approach was inconsistent simply because the nature of CMI’s and RAK’s businesses were different. We note, however, that the KTC’s Redetermination does not explain the reason for this dual approach regarding the secondary sources of information used to determine different elements of CMI’s SG&A expenses. In our view, even if there was no difference between the nature of the businesses of CMI and April Fine on the one hand and RAK on the other, the special circumspection requirement of paragraph 7 of Annex II would call for an explanation as to why different sources have been used for different elements of CMI’s SG&A expenses. Given the significant difference between the interest expenses of April Fine and RAK, the need for an explanation became, in our view, even more important in the circumstances of the proceedings at issue. As we mentioned in our original panel report, we do not exclude the possibility that a producing company’s data may be used in the place of a trading company’s data as long as the authorities’ determination adequately explains the reason for such an approach. In this case, however, there is no such adequate explanation.

…

In our view, the issue is not whether the interest expenses used by the KTC for CMI were in line with the expenses of some other companies, but rather whether the KTC exercised special circumspection in deciding to use RAK’s interest expenses as proxy for CMI. In this regard, we generally note that the KTC’s Re-determination focuses on what is ‘appropriate’ or ‘proper’ in terms of representing CMI’s interest expenses …, rather than showing in what ways, if at all, the KTC exercised special circumspection in the use of the information from the secondary source, RAK, from which such expenses were derived.

 

In this connection, we would like to stress that we are not implying that the KTC should have used April Fine’s interest expenses as proxy for CMI. Rather, it is the nonexistence on the record of an adequate explanation as to why the KTC decided not to use April Fine’s data for interest expenses although it used it for all other elements of CMI’s SG&A expenses that, in our view, makes the KTC’s determination fall short of the special circumspection requirement of paragraph 7 of Annex II.”⁽⁸¹⁴⁾

(ii) “Adverse” facts available

591.   In US — Hot-Rolled Steel, the United States authorities had resorted to “adverse” facts available to calculate the dumping margins of an exporter because the exporter had not cooperated in providing certain requested data. In this case, Japan had not contested the possibility of resorting to “adverse” facts available in case of non-cooperation by a party. Its claim was that the Japanese exporter concerned had cooperated and thus the United States authorities should have not declared them non-cooperating parties and thus used “adverse” facts available. The Panel focused its analysis on whether or not the Japanese exporter had cooperated without entering into an analysis of the compatibility of resorting to “adverse” effects with the Anti-Dumping Agreement. The Panel held that the authorities’ conclusion that the exporter failed to “cooperate” in the investigation “did not rest on a permissible interpretation of that word”.⁽⁸¹⁵⁾ The Appellate Body, which upheld the Panel’s finding, indicated in a footnote to its Report, that “the term ‘adverse’ does not appear in the Anti-Dumping Agreement in connection with the use of facts available. Rather, the term appears in the provision of the United States Code that applies to the use of facts available”.⁽⁸¹⁶⁾ It however indicated that it would not consider “whether, or to what extent, it is permissible, under the Anti-Dumping Agreement, for investigating authorities consciously to choose facts available that are adverse to the interests of the party concerned”.⁽⁸¹⁷⁾ The Appellate Body stressed that its analysis was circumscribed to using the term “adverse” facts available simply to denote that the authorities had drawn “an inference that was adverse to the interests of the non-cooperating party ‘in selecting among the facts otherwise available’”.⁽⁸¹⁸⁾ For its analysis of the term non-cooperation, see paragraphs 573–583 above.

(l) Authorities’ duty to inform on reasons for disregarding information

592.   In Argentina — Ceramic Tiles, the Panel considered that “Article 6.8, read in conjunction with paragraph 6 of Annex II, requires an investigating authority to inform the party supplying information of the reasons why evidence or information is not accepted, to provide an opportunity to provide further explanations within a reasonable period, and to give, in any published determinations, the reasons for the rejection of evidence or information”.⁽⁸¹⁹⁾

593.   In Egypt — Steel Rebar, the Panel considered that “the fact that an investigating authority may request information in several tranches during an investigation⁽⁸²⁰⁾ cannot, however, relieve it of its Annex II, paragraph 6 obligations in respect of the second and later tranches, as that requirement applies to ‘information and evidence’ without temporal qualification.⁽⁸²¹⁾”⁽⁸²²⁾

594.   The Panel in Korea — Certain Paper noted that “paragraph 6 does not […] set out a procedure through which the interested party has to be notified of […] rejection”.⁽⁸²³⁾

595.   In Mexico — Steel Pipes and Tubes, Guatemala claimed that the investigating authority never informed Tubac (the only identified exporter) that it had decided to reject Tubac’s data in its entirety, and never gave Tubac an opportunity to provide further explanations and therefore Mexico violated paragraph 6 of Annex II.⁽⁸²⁴⁾ The Panel recalled the well settled obligation under paragraph 6 in Annex II:

“[W]e recall that paragraph 6 of Annex II requires that the party supplying information that ‘is not accepted’ by the investigating authority must be ‘informed forthwith of the reasons therefor’ and given ‘an opportunity to provide further explanations within a reasonable period’. The nature of this obligation is well settled⁽⁸²⁵⁾, and the parties to this dispute do not disagree in this regard. Rather, their disagreement centres on whether — as a factual matter — Economía provided the requisite notification and opportunity to submit further explanations within the meaning of Annex II.”⁽⁸²⁶⁾

596.   In short, the Panel in Mexico — Steel Pipes and Tubes found that the verification report did not satisfy the requirement in paragraph 6 of Annex II to notify the interested party of the decision to reject its information and of the reasons for doing so, and therefore, “by definition also could not satisfy the requirement to provide the interested party an opportunity to submit further explanations following the decision.”⁽⁸²⁷⁾

(m) No right to submit further information

597.   The Panel in Korea — Certain Paper considered that what paragraph 6 requires is:

“[T]hat the IA has to give the interested party whose information is rejected the opportunity to explain to the IA why the information has to be taken into consideration. This, in turn, would give the IA a second chance to review its decision to reject that information. Paragraph 6 does not, however, give the interested party a second chance to submit information. If paragraph 6 is interpreted to mean that each time there is a defect in the submitted information the interested party concerned has the right to submit further information, the investigation might carry on indefinitely.”⁽⁸²⁸⁾

(n) Confidential versus non-confidential information

598.   In Argentina — Ceramic Tiles, Argentina had argued that the failure to provide a non-confidential summary which is sufficiently detailed to permit the calculation of normal value, export price and the margin of dumping amounts to a refusal to provide access to information that is necessary for the authority in the determination of a dumping margin determination. The Panel disagreed with Argentina and supported its position by reference to Article 6.5 of the Anti-Dumping Agreement which requires an investigating authority to treat information which is by nature confidential or which is provided on a confidential basis as confidential information and prescribes that such information shall not be disclosed without specific permission of the party submitting it. The Panel considered that it would be contradictory to suggest that the Anti-Dumping Agreement creates a mechanism for the protection of confidential information, but precludes investigating authorities from relying on such information in making its determinations. It further concluded that nothing in this Article authorizes a Member to disregard confidential information solely on the basis that the non-confidential summary does not permit dumping calculations:

“In our view, the presence in [Article 6.5] the AD Agreement of a requirement to protect confidential information indicates that investigating authorities might need to rely on such information in making the determinations required under the AD Agreement. The AD Agreement therefore contains a mechanism that allows parties to provide investigating authorities with such information for the purposes of making their determinations, while ensuring that the information is not used for other purposes. In accordance with the accepted principles of treaty interpretation, we are to give meaning to all the terms of the Agreement.⁽⁸²⁹⁾ It would be contradictory to suggest that the AD Agreement creates a mechanism for the protection of confidential information, but precludes investigating authorities from relying on such information in making its determinations. If that were the case, then there would be no reason for the investigating authority to seek such information in the first place.

 

…

 

We are aware that, for the purpose of transparency, Article 6.5.1 obliges an authority to require the parties providing confidential information to furnish non-confidential summaries which shall be in sufficient detail to permit a reasonable understanding of the substance of the information submitted in confidence. We consider that this is an important element of the AD Agreement which reflects the balance struck by the Agreement between the need to protect the confidentiality of certain information, on the one hand, and the need to ensure that all parties have a full opportunity to defend their interests, on the other. However, we see nothing in Article 6.5.1, nor elsewhere in Article 6.5, that authorizes a Member to disregard confidential information solely on the basis that the non-confidential summary of that information contains insufficient detail to permit authorities to calculate normal value, export price and the margin of dumping.⁽⁸³⁰⁾”⁽⁸³¹⁾

599.   The Panel in Argentina — Ceramic Tiles further referred to Article 12 of the Anti-Dumping Agreement, which sets forth requirements regarding the contents of public notices in confirmation of its conclusion above that an investigating authority may rely on confidential information in making determinations while respecting its obligation to protect the confidentiality of that information:

“Thus, the transparency requirement which obligates the authority to explain its determination in a public notice is subject to the need to have regard to the requirement for the protection of confidential information of Article 6.5 of the AD Agreement. Confidentiality of the information submitted therefore limits the manner in which the authority explains its decision and supports its determination in a public notice. In sum, Article 12 implies, to our mind, that an investigating authority may rely on confidential information in making determinations while respecting its obligation to protect the confidentiality of that information.”⁽⁸³²⁾

600.   The Panel, in Argentina — Ceramic Tiles, also found support for its view on the Appellate Body decision in Thailand — H-Beams, which addressed the question of the use of confidential information by the investigating authorities as a basis for its final determinations under Article 3 of the Anti-Dumping Agreement.

(o) Scope of Panel’s review: national authorities’ justification at the time of its determination

601.   With respect to the use of “best information available”, the Panel in Guatemala — Cement II restricted the scope of its examination to the reasoning provided by Guatemala’s authority in its determination, citing the finding of the Panel in Korea — Dairy.⁽⁸³³⁾ The Panel stated that “[e]ven if the additional factors identified by Guatemala before the Panel could justify the use of ‘best information available’, such ex post justification by Guatemala should not form part of our assessment of the conduct of the Ministry leading up to the imposition of the January 1997 definitive anti-dumping measure.”⁽⁸³⁴⁾ Subject to this limitation, however, the Panel stated that “[a]n impartial and objective investigating authority could not properly rely on ‘best information available’ sales data for the original [period of investigation], simply on the basis of [the] failure [of the subject Mexican producer] to provide sales data for the extended [period of investigation].”⁽⁸³⁵⁾

(p) Consistency of domestic legislation with Article 6.8 and Annex II

602.   In US — Steel Plate, the Panel was asked to consider the consistency of United States law with Article 6.8 and Annex II of the Anti-Dumping Agreement. In reference to the existing jurisprudence on mandatory versus discretionary legislation⁽⁸³⁶⁾, the Panel considered that the question before it was whether the US statutory provision at issue required the US authorities to resort to facts available in circumstances other than the circumstances in which Article 6.8 and paragraph 3 of Annex II permit resort to facts available⁽⁸³⁷⁾ The Panel found that the “practice” of the US authorities concerning the application of “total facts available” was not a measure which can give rise to an independent claim of violation of the Anti-Dumping Agreement.⁽⁸³⁸⁾

(q) Relationship with other paragraphs of Article 6

603.   In Guatemala — Cement II, the Panel addressed Mexico’s claim that Guatemala’s investigating authority violated Articles 6.1, 6.2, 6.8 and Annex II(5) and (6) of the Anti-Dumping Agreement by rejecting certain technical accounting evidence submitted by the Mexican producer one day before the public hearing held by Guatemala’s authority. See paragraph 457 above.

604.   In US — Hot-Rolled Steel, the Appellate Body referred to Article 6.13 as support for its view that paragraphs 2 and 5 of Annex II call for a balance between the interests of investigating authorities and exporters as regards cooperation in anti-dumping investigations. See paragraph 580 above.

605.   In Argentina — Ceramic Tiles, the Panel, when examining whether the investigating authorities were entitled to resort to facts available pursuant to Article 6.8, referred to Article 6.1 to support its conclusion that the investigating authorities could not do so when they did not clearly request the relevant information to the party in question. See paragraphs 427 above and 543 above. The Appellate Body in US — Hot-Rolled Steel further analysed the relationship of Article 6.8 and Annex II with Article 6.1.1. See paragraphs 433, 563 and 567 above.

606.   The Panel, in Argentina — Ceramic Tiles, referred to Article 6.5 of the Anti-Dumping Agreement as support of its conclusion above that an investigating authority may rely on confidential information in making determinations while respecting its obligation to protect the confidentiality of that information. See paragraph 598 above.

607.   In Egypt — Steel Rebar, the Panel addressed the relationship of Article 6.2 with Annex II and Article 6.8. See paragraph 998 below.

(r) Relationship with other provisions of Anti-Dumping Agreement

(i) Relationship with Article 5.3.

608.   The Panel in Korea — Certain Paper disagreed with Korea’s contention that in certain cases, the fulfilment of the obligation under Article 3.3 may also suffice to meet the requirements of paragraph 7 of Annex II, concluding that:

“[T]he obligations set forth under Article 5.3 and paragraph 7 of Annex II are different. Firstly, these two sets of obligations apply at different stages of an investigation: Article 5.3 concerns the quality of the evidence that would justify the initiation of an investigation whereas paragraph 7 of Annex II has to do with the evidence on which the IA’s final determination may be based. Secondly, the standards of these two obligations are different. The standard under Article 5.3 is that evidence be ‘adequate and accurate’ so as to justify initiation whereas paragraph 7 of Annex II requires that information from secondary sources be compared against that from other independent sources. We therefore do not agree with the view that the fulfilment of the obligation under Article 5.3 of the Agreement may in some cases also satisfy the requirements of paragraph 7 of Annex II. It may be the case that the obligation to corroborate under paragraph 7 may entail little substantive analysis in addition to the analysis carried out under Article 5.3 at the initiation stage. However, that does not make these two obligations the same from a procedural and substantive point of view. They are two distinct obligations that have to be observed by the IA at different stages of an investigation …”⁽⁸³⁹⁾

8. Article 6.9

(a) “shall, before a final determination is made, inform all interested parties of the essential facts under consideration”

(i) Means to inform all interested parties of the essential facts

609.   In Argentina — Ceramic Tiles, the Panel, further to noting that Article 6.9 does not prescribe the manner in which the investigating authority is to comply with the disclosure obligation, provided some examples of how investigating authorities may comply with this requirement:

“We agree with Argentina that the requirement to inform all interested parties of the essential facts under consideration may be complied with in a number of ways. Article 6.9 of the AD Agreement does not prescribe the manner in which the authority is to comply with this disclosure obligation. The requirement to disclose the ‘essential facts under consideration’ may well be met, for example, by disclosing a specially prepared document summarizing the essential facts under consideration by the investigating authority or through the inclusion in the record of documents — such as verification reports, a preliminary determination, or correspondence exchanged between the investigating authorities and individual exporters — which actually disclose to the interested parties the essential facts which, being under consideration, are anticipated by the authorities as being those which will form the basis for the decision whether to apply definitive measures. This view is based on our understanding that Article 6.9 anticipates that a final determination will be made and that the authorities have identified and are considering the essential facts on which that decision is to be made. Under Article 6.9, these facts must be disclosed so that parties can defend their interests, for example by commenting on the completeness of the essential facts under consideration.”⁽⁸⁴⁰⁾

610.   In the dispute on US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina), Argentina claimed that the USDOC had acted inconsistently with Article 6.9 by not disclosing to the Argentine exporters “the essential facts that formed the basis of its decision to continue the measure at issue”. The United States contended that Argentina had not made a prima facie case because it had not proven this information “constituted essential facts within the meaning of Article 6.9.”⁽⁸⁴¹⁾ The Panel agreed with the United States:

“Given that the obligation under Article 6.9 applies to essential facts and that the two memoranda cited by Argentina contain the USDOC’s reasoning regarding the data submitted by the Argentine exporters, we reject Argentina’s claim under Article 6.9.”⁽⁸⁴²⁾

(ii) “the essential facts … which form the basis for the decision whether to apply definitive measures”

611.   The Panel in Argentina — Poultry Anti-Dumping Duties stated that facts which do not form the basis for the decision whether to apply definitive measures cannot be considered to be “essential facts” within the meaning of Article 6.9 of the AD Agreement. The Panel was thus of the view that data which “is not going to be relied on in making a final determination is not a fact which forms the basis for the decision whether to apply definitive measures”.⁽⁸⁴³⁾ In other words, while the Panel accepted that normal value and export price data ultimately used in the final determination are essential facts which form the basis for the decision whether to apply definitive measures, “the fact that certain normal value and export price data is not going to be used is not”.⁽⁸⁴⁴⁾

612.   The Panel in Argentina — Poultry Anti-Dumping Duties further considered that the term “essential facts” refers to “factual information” rather than “reasoning”. In the Panel’s view, the failure to inform an interested party of the reasons why the authority failed to use certain data does not equate to a failure to inform an interested party of an essential fact:

“We do not believe that the ordinary meaning of the word ‘fact’ would support a conclusion that Article 6.9, when using the term ‘fact’, refers not only to ‘facts’ in the sense of ‘things which are known to have occurred, to exist or to be true’, but also to ‘motives, causes or justifications’.”⁽⁸⁴⁵⁾

613.   Noting that Article 6.9 requires the investigating authority to disclose the essential facts establishing the basis of its final determination whether to apply definitive measures in an investigation, the Panel in Korea — Certain Paper explained that:

“[T]he obligation under Article 6.9 is one that requires the IA to make a one-time disclosure and that is before a final determination is made as to whether or not a definitive measure will be applied.”⁽⁸⁴⁶⁾

614.   In the view of the Panel in Korea — Certain Paper (Article 21.5 — Indonesia), Article 6.9 provided a onetime disclosure requirement that contained the “essential facts” under consideration regarding the authorities’ decision on whether to apply definitive measures. The scope of the obligation excluded the reasoning of the authorities or their intention as to how certain determinations were made.⁽⁸⁴⁷⁾

(iii) Relevance of the fact that information is made available in the authorities’ record

615.   In Guatemala — Cement II, the Panel considered that, although the essential facts under consideration may be available in the authorities’ file, interested parties with access to that file will not know whether or which particular information in that file forms the basis of the authorities’ determination. In the Panel’s view, one purpose of Article 6.9 is to resolve this problem. Accordingly, the Panel rejected Guatemala’s argument that interested parties had been informed that a certain directorate would make a technical study on the basis of the evidence in the file, and that copies of the file had been available. The Panel explained:

“We note that an investigating authority’s file is likely to contain vast amounts of information, some of which may not be relied on by the investigating authority in making its decision whether to apply definitive measures. For example, the file may contain information submitted by an interested party that was subsequently shown to be inaccurate upon verification. Although that information will remain in the file, it would not form the basis of the investigating authority’s decision whether to apply definitive measures. The difficulty for an interested party with access to the file, however, is that it will not know whether particular information in the file forms the basis of the authority’s final determination. One purpose of Article 6.9 is to resolve this difficulty for interested parties… . An interested party will not know whether a particular fact is ‘important’ or not unless the investigating authority has explicitly identified it as one of the ‘essential facts’ which form the basis of the authority’s decision whether to impose definitive measures.”⁽⁸⁴⁸⁾

616.   In support of its rejection of Guatemala’s argument that it had disclosed the facts forming the basis of its definitive determination by merely allowing access to the file, the Panel referred to Article 6.4 and found that if Guatemala’s interpretation were accepted, there would be “little, if any, practical difference between Article 6.9 and Article 6.4”:

“Furthermore, if the disclosure of ‘essential facts’ under Article 6.9 could be undertaken simply by providing access to all information in the file, there would be little, if any, practical difference between Article 6.9 and Article 6.4. Guatemala is effectively arguing that it complied with Article 6.9 by complying with Article 6.4, i.e., by providing ‘timely opportunities for interested parties to see all information that is relevant to the presentation of their cases … and that is used by the authorities …’. We do not accept an interpretation of Article 6.9 that would effectively reduce its substantive requirements to those of Article 6.4. In our view, an investigating authority must do more than simply provide ‘timely opportunities for interested parties to see all information that is relevant to the presentation of their cases … and that is used by the authorities …’ in order to ‘inform all interested parties of the essential facts under consideration which form the basis for the decision whether to apply definitive measures’.”⁽⁸⁴⁹⁾

(iv) Disclosure of information forming the basis of a preliminary ruling

617.   In Guatemala — Cement II, Mexico claimed that Guatemala’s authority acted inconsistently with Article 6.9 by failing to inform the Mexican producer subject to investigation of the “essential facts under consideration”. In response, Guatemala first argued that the “essential facts under consideration” had been disclosed to interested parties in a detailed report setting out its authority’s preliminary rulings. The Panel rejected Guatemala’s justification, pointing out, among other things, that while the preliminary measures had been based on a threat of material injury, the final determination was based on actual material injury:

“Article 6.9 provides explicitly for disclosure of the ‘essential facts … which form the basis for the decision whether to apply definitive measures’ (emphasis supplied). Disclosure of the ‘essential facts’ forming the basis of a preliminary determination is clearly inadequate in circumstances where the factual basis of the provisional measure is significantly different from the factual basis of the definitive measure. In the present case, the preliminary measure was based on a preliminary determination of threat of material injury, whereas the final determination was based on actual material injury. Furthermore, the Ministry’s preliminary determination (16 August 1996) was based on a [period of investigation (‘POI’)] different from that used for its final determination, since the POI was extended on 4 October 1996. Indeed, Guatemala has cited the United States’ assertion that ‘[i]n the course of an anti-dumping investigation, the bulk of the evidence which forms the basis of the final determination is generally gathered after the preliminary determination’. If the bulk of the evidence which forms the basis of the final determination is generally gathered after the preliminary determination, we fail to see how disclosure of the ‘essential facts’ forming the basis of the preliminary determination could amount to disclosure of the ‘essential facts’ forming the basis of the final determination, since the ‘bulk’ of the ‘essential facts’ underlying the final determination would not yet have been gathered. In these circumstances, we do not consider that the Ministry could satisfy the Article 6.9 obligation to ‘inform all interested parties of the essential facts under consideration which form the basis for the decision whether to apply definitive measures’ by providing disclosure of the essential facts forming the basis of its preliminary determination.”⁽⁸⁵⁰⁾

(v) Failure to inform the changes in factual foundation from a preliminary determination to final determination

618.   In Guatemala — Cement II, the Panel rejected Mexico’s claim that Guatemala’s authority was in violation of Articles 6.1, 6.2 and 6.9 by changing its injury determination from a preliminary determination of threat of material injury to a final determination of actual material injury during the course of the investigation, without informing the Mexican producer of that change, and without giving the producer a full and ample opportunity to defend itself. After considering Article 12.2, the Panel explained with regard to Article 6.9, as follows:

“We note that Articles 6.1 and 6.9 impose certain obligations on investigating authorities in respect of ‘information’, ‘evidence’ and ‘essential facts’. However, Mexico’s claim does not concern interested parties’ right to have access to certain factual information during the course of an investigation. Mexico’s claim concerns interested parties’ alleged right to be informed of an investigating authority’s legal determinations during the course of an investigation.”⁽⁸⁵¹⁾

619.   The Panel in EC — Salmon (Norway) noted that a change in outcome did not trigger a requirement for any additional disclosure under Article 6.9:

“How an investigating authority undertakes to disclose the essential facts does not change the nature of the obligations under Article 6.9. The second sentence of Article 6.9 makes clear that the disclosure of essential facts must be in sufficient time to allow parties to defend their interests. In our view, this must entail the possibility that, whatever decision may have possibly been foreseen or foreseeable at the time of disclosure, the ultimate decision may be a different one, based on the defence of parties’ interests following that disclosure. Clearly, the investigating authority must, in making its decision whether to apply definitive measures, take into account whatever information or argument parties submit subsequent to disclosure to defend their interests. The alternative would render meaningless the right of parties to receive disclosure of essential facts in sufficient time to defend their interests. However, we do not consider that this possible change of outcome triggers a requirement for additional disclosure under Article 6.9. Thus, the fact that the EC undertakes disclosure by providing a draft definitive regulation does not mean that, should the investigating authority ultimately issue a determination that differs in some respect from the draft, an additional disclosure is required. Such a change in the ultimate determination is presumably what is envisioned by the right given to parties to defend their interests after the disclosure. The manner in which the EC chooses to provide disclosure does not limit the investigating authority’s obligation to take into account comments and information submitted by interested parties after disclosure, and the concomitant possibility that the investigating authority may issue a definitive regulation that differs, even in material respects, from that provided in draft form as part of the Article 6.9 disclosure.

…

In our view, this sequence of events demonstrates precisely the purpose of Article 6.9. Following the definitive disclosure, the investigating authority received further information which prompted it to a re-consideration and adjustment of its views, resulting in a different determination than that indicated in the draft definitive regulation at the time of the Article 6.9 disclosure. Norway’s argument would presumably require the investigating authority to disclose whatever new information was provided, on the premise that the different result demonstrates that the new information constituted ‘essential facts’ within the meaning of Article 6.9. Article 6.9 would then mandate a further opportunity for interested parties to defend their interests, and an endless stream of disclosures and comments could ensue. Norway’s position would result in an impossible situation for investigating authorities, which must complete the investigation within the time limits set out in Article 5.10 of the AD Agreement. Norway suggests that this could only happen because the investigating authority decided that different facts were essential to its determination, and that disclosure of these previously undisclosed essential facts is required … Norway’s view confuses the essential facts with the facts supporting the decision.

…

We do not consider that every element of factual evidence considered by the investigating authority must be disclosed, or that every fact disclosed must be footnoted to the specific source information before the investigating authority. We can see nothing in Article 6.9 which would require any particular form of disclosure, or any particular degree of precision in tying facts to the information before the investigating authority. While it would certainly be useful for the investigating authority to indicate to interested parties the information before the investigating authority on which a disclosed essential fact is based, we cannot conclude that this is required.”⁽⁸⁵²⁾

(b) Relationship with other paragraphs of Article 6

620.   In Guatemala — Cement II, having found that Guatemala’s failure to disclose the “essential facts” forming the basis of its final determination was in violation of Article 6.9, as referenced in paragraphs 615, 616 and 618 above, the Panel considered it unnecessary to examine whether it was also inconsistent with Articles 6.1 and 6.2.⁽⁸⁵³⁾

621.   The Panel in Guatemala — Cement II touched on the relationship between the obligations under Articles 6.4 and 6.9. See paragraph 616 above.

9. Article 6.10

(a) “shall, as a rule”: nature of obligations under Article 6.10

622.   See also under Article 9.4, at paragraph 698 and following.

623.   In Argentina — Ceramic Tiles, the Panel explained the structure of the obligations set forth in Article 6.10 as follows:

“The first sentence of Article 6.10 of the AD Agreement sets forth a general rule that the authorities determine an individual margin of dumping for each known exporter or producer of the product under investigation. The second sentence of Article 6.10 permits an investigating authority to deviate from the general rule by permitting the investigating authorities to ‘limit their examination either to a reasonable number of interested parties or products by using samples … or to the largest percentage of the volume of the exports from the country in question which can reasonably be investigated’, in cases where the number of exporters, producers, importers or types of products involved is so large as to make such a determination impracticable…”⁽⁸⁵⁴⁾

624.   The Appellate Body in EC — Fasteners (China) stated that the rule in the first sentence of Article 6.10 is mandatory, subject only to specifically provided exceptions: “The general rule, that is, the obligation to determine individual margins of dumping for each known exporter or producer, applies, unless derogation from it is provided for in the covered agreements.”⁽⁸⁵⁵⁾ In response to an EU argument that in practice, there are exceptions to the Article 6.10 rule that are not specified in the Agreement, the Appellate Body analysed the series of exceptions cited, and found that each involved situations that either do not constitute departures from the individual margins rule, or are provided for in Article 6.10 itself or in other provisions of the Agreement.⁽⁸⁵⁶⁾ The Appellate Body further found that this general rule applies also in respect of imports from non-market economies (NMEs):

“[W]e do not find any provision in the covered agreements that would allow importing Members to depart from the obligation to determine individual dumping margins only in respect of imports from NMEs. We have explained above that Section 15 of China’s Accession Protocol permits derogation in respect of the domestic price or normal value aspect of price comparability, but does not address the export price aspect of price comparability. It, therefore, has no entailment in respect of the obligation in Article 6.10 of the Anti-Dumping Agreement to determine individual dumping margins. In our view, therefore, Section 15 of China’s Accession Protocol does not provide a legal basis for flexibility in respect of export prices and for justifying an exception to the requirement to determine individual dumping margins in Article 6.10 of the Anti-Dumping Agreement.”⁽⁸⁵⁷⁾

(b) “individual margin of dumping for each known exporter or producer”

(i) “each … exporter or producer”

625.   In Argentina — Ceramic Tiles, the Argentine authorities had established a dumping margin for three size categories of ceramic tile irrespective of the exporter. The Panel concluded that “[w]hile the second sentence of Article 6.10 allows an investigating authority to limit its examination to certain exporters or producers, it does not provide for a deviation from the general rule that individual margins be determined for those exporters or producers that are examined”:⁽⁸⁵⁸⁾

“In our view, the general rule in the first sentence of Article 6.10, that individual margins of dumping be determined for each known exporter or producer of the product under investigation, is fully applicable to exporters who are selected for examination under the second sentence of Article 6.10. While the second sentence of Article 6.10 allows an investigating authority to limit its examination to certain exporters or producers, it does not provide for a deviation from the general rule that individual margins be determined for those exporters or producers that are examined. To the contrary, Article 9.4 provides that, where the authorities limit their examination under Article 6.10, the anti-dumping duty for exporters or producers that are not examined shall not exceed a level determined on the basis of the results of the examination of those exporters or producers that were examined. That Article 9.4 does not provide any methodology for determining the level of duties applicable to exporters or producers that are examined in our view confirms that the general rule requiring individual margins remains applicable to those exporters or producers. We find further confirmation in Article 6.10.2, which requires that, in general, an individual margin of dumping must be calculated even for the producers/exporters not initially included in the sample, if they provide the necessary information and if to do so is not unduly burdensome. If even producers not included in the original sample are entitled to an individual margin calculation, then it follows that producers that were included in the original sample are so entitled as well.⁽⁸⁵⁹⁾”⁽⁸⁶⁰⁾

626.   The Panel in Argentina — Poultry Anti-Dumping Duties considered that Article 6.10 is purely procedural in nature, in the sense that it imposes a procedural obligation on the investigating agency to determine individual margins of dumping for each known exporter or producer concerned of the product under investigation. According to the Panel, “Article 6.10 is not concerned with substantive issues concerning the determination of individual margins, such as the availability of the relevant data. Such issues are addressed by provisions such as Articles 2 and 6.8 of the AD Agreement.”⁽⁸⁶¹⁾ The Panel thus rejected the argument that for the requirement under Article 6.10 to apply, the exporter or producer concerned should supply the documentation needed to determine an individual margin of dumping.

(ii) Treatment of distinct legal entities as a single exporter or producer

627.   In Korea — Certain Paper, the Panel considered that the KTC’s decision to treat three companies as a single exporter or producer and assign a single margin was consistent with Article 6.10, because the three companies were majority owned by the same company, had common shareholdings and management and could shift production amongst themselves, harmonize commercial activity and corporate objectives, and make domestic sales through a single company.⁽⁸⁶²⁾ Based on an analysis of Article 6.10 in light of its context, particularly Articles 9.5, 2.3 and 2.1, the Panel found that the term “exporter” in Article 6.10 should not be read in a way to require an individual margin of dumping for each independent legal entity under all circumstances:⁽⁸⁶³⁾

“Article 6.10 does not necessarily preclude treating distinct legal entities as a single exporter or producer for purposes of dumping determinations in anti-dumping investigations. Having said that, however, we do not consider that Article 6.10 provides the IA with unlimited discretion to do so … In our view, in order to properly treat multiple companies as a single exporter or producer in the context of its dumping determinations in an investigation, the IA has to determine that these companies are in a relationship close enough to support that treatment.”⁽⁸⁶⁴⁾

628.   The Panel and Appellate Body in EC — Fasteners (China) examined Article 9(5) of the EU’s Basic Anti-Dumping Regulation, which presumed “that all producers and exporters in an NME constitute a single entity together with the State.”⁽⁸⁶⁵⁾ Article 9(5) required NME producers to demonstrate their independence from state control in order to qualify for “individual treatment” (IT). For NME producers that fail the IT test, the Commission would calculate a single country-wide dumping margin and duty rate; for NME producers that pass the test, the Commission would compare the same normal value but use the producer’s own export price.⁽⁸⁶⁶⁾ The European Union argued that in the case of market economies (as in Korea — Certain Paper) the close relationship between separate legal entities has to be established by the investigating authority on a case-by-case basis; by contrast, in NMEs the presumption of State control is the general rule. The Appellate Body upheld the Panel’s finding that the presumption in Article 9(5) violated Articles 6.10 and 9.2, and that Article 9(5) was not otherwise legally justifiable:

“[U]nder Articles 6.10 and 9.2 of the Anti-Dumping Agreement it is the investigating authority that is called upon to make an objective affirmative determination, on the basis of the evidence that has been submitted or that it has gathered in the investigation, as to who is the known exporter or producer of the product concerned. It is, therefore, the investigating authority that will determine whether one or more exporters have a relationship with the State such that they can be considered as a single entity and receive a single dumping margin and a single anti-dumping duty. In other words, where certain exporters or producers are separate legal entities, that evidence will be taken into account in treating them as separate exporters or producers for purposes of Articles 6.10 and 9.2 of the Anti-Dumping Agreement… .

 

… placing the burden on NME exporters to rebut a presumption that they are related to the State and to demonstrate that they are entitled to individual treatment runs counter to Article 6.10, which ‘as a rule’ requires that individual dumping margins be determined for each known exporter or producer, and is inconsistent with Article 9.2 that requires that individual duties be specified by supplier. Even accepting in principle that there may be circumstances where exporters and producers from NMEs may be considered as a single entity for purposes of Articles 6.10 and 9.2, such singularity cannot be presumed; it has to be determined by the investigating authorities on the basis of facts and evidence submitted or gathered in the investigation.

 

We are also of the view that no other provision in the Anti-Dumping Agreement or in other covered agreements provides a legal basis for the European Union’s presumption in Article 9(5) of its Basic AD Regulation that results in exporters and producers from NMEs having to demonstrate that they are unrelated to the State in order to qualify for individual treatment. In particular, we do not consider that there is a legal basis in the provisions of China’s Accession Protocol …

 

It is true that paragraph 15(a) of China’s Accession Protocol places the burden on Chinese exporters to ‘clearly show’ that market economy conditions prevail in order for the importing WTO Members to be obliged to use Chinese domestic prices and costs in determining price comparability. However, this rule concerns only the normal value aspect of price comparability, and does not permit derogation from the disciplines of the Anti-Dumping Agreement regarding export price. …

 

…whether the European Union’s presumption under Article 9(5) of its Basic AD Regulation that in NMEs the State and all exporters constitute a single entity is consistent with Articles 6.10 and 9.2 of the Anti-Dumping Agreement is a legal question, not a factual one that depends on the economic structure of a particular WTO Member. Rather, the economic structure of a WTO Member may be used as evidence before an investigating authority to determine whether the State and a number of exporters or producers subject to an investigation are sufficiently related to constitute a single entity such that a single margin should be calculated and a single duty be imposed on them. It cannot, however, be used to imply a legal presumption that has not been written into the covered agreements.”⁽⁸⁶⁷⁾

629.   The Appellate Body further opined regarding the circumstances in a number of exporters owned by the State that they may be determined to constitute a single exporter for the purposes of Articles 6.10 and 9.2, noting that “the criteria used for determining whether a single entity exists from a corporate perspective, while certainly relevant, will not necessarily capture all situations where the State controls or materially influences several exporters such that they could be considered as a single entity for purposes of Articles 6.10 and 9.2 … and be assigned a single dumping margin and anti-dumping duty.”⁽⁸⁶⁸⁾

“Articles 6.10 and 9.2 of the Anti-Dumping Agreement do not preclude an investigating authority from determining a single dumping margin and a single anti-dumping duty for a number of exporters if it establishes that they constitute a single exporter for purposes of Articles 6.10 and 9.2 of the Anti-Dumping Agreement. Whether determining a single dumping margin and a single anti-dumping duty for a number of exporters is inconsistent with Articles 6.10 and 9.2 will depend on the existence of a number of situations, which would signal that, albeit legally distinct, two or more exporters are in such a relationship that they should be treated as a single entity. These situations may include: (i) the existence of corporate and structural links between the exporters, such as common control, shareholding and management; (ii) the existence of corporate and structural links between the State and the exporters, such as common control, shareholding and management; and (iii) control or material influence by the State in respect of pricing and output. We note that the Anti-Dumping Agreement addresses pricing behaviour by exporters; if the State instructs or materially influences the behaviour of several exporters in respect of prices and output, they could be effectively regarded as one exporter for purposes of the Anti-Dumping Agreement and a single margin and duty could be assigned to that single exporter.”⁽⁸⁶⁹⁾

630.   The Appellate Body further explained that:

“Criteria relating to corporate structure may in certain circumstances be relevant to the determination of whether the State and certain exporters constitute a single entity. In other circumstances, however, an investigating authority might have to take into account factors and positive evidence other than those establishing a corporate or commercial relationship in assessing whether the State and a number of exporters are a single entity and that, therefore, the State is the source of price discrimination. These, for instance, may include evidence of State control or instruction of, or material influence on, the behaviour of certain exporters in respect of pricing and output. These criteria could show that, even in the absence of formal structural links between the State and specific exporters, the State in fact determines and materially influences prices and output.”⁽⁸⁷⁰⁾

631.   The Appellate Body further found that the country-wide dumping margins and duties imposed under Article 9(5) of the EC Regulation were inconsistent with Articles 6.10 and 9.2:

“[E]ven where it could be determined that particular exporters that are related constitute a single supplier, Articles 6.10 and 9.2 of the Anti-Dumping Agreement would nonetheless require the determination of an individual dumping margin for the single entity, which should be based on the average export prices of each individual exporter, and the imposition of a corresponding single anti-dumping duty… .

 

In our view, only a dumping margin that is based on a weighted average of the export prices of each individual exporter that forms part of the single entity would be consistent with the obligation in Article 6.10 to determine an individual dumping margin for the single entity that is composed of several legally distinct exporters. We also do not consider that a country-wide duty imposed on a group of exporters could be considered as being ‘collected in the appropriate amounts in each case’ within the meaning of Article 9.2 of the Anti-Dumping Agreement, to the extent it is determined for the group of fully cooperating non-IT exporters on the basis of facts available because cooperating exporters account for significantly less than 100 per cent of all exports.”⁽⁸⁷¹⁾

(iii) “known exporter or producer”

632.   The Appellate Body in Mexico — Anti-Dumping Measures on Rice found that the word “known” in Article 6.10 refers to exporters/producers known to the investigating authority, and does not include ones which the authority “should have known.”⁽⁸⁷²⁾

(c) “the authorities may limit their examination either to a reasonable number of interested parties or products”: sampling and Article 6.10

633.   The Panel in EC — Salmon (Norway) considered that identifying the pool of known exporters or producers was central in selecting interested parties:

“If there has been an error in the identification of the starting pool of ‘known exporter[s] or producer[s] concerned’ this would, in our view, invalidate the selection of interested parties … ”⁽⁸⁷³⁾

634.   The Panel in EC — Salmon (Norway) noted that the ordinary meaning of the text in Article 6.10 suggested that Members could choose to focus their investigation on all known exporters, all known producers, or all known exporters and producers. The Panel concluded that the European Communities had not acted inconsistently with Article 6.10 by limiting the number of interested parties investigated, and excluding “all non-producing exporters”. In EC — Salmon (Norway), the European Communities had selected ten interested parties, which Norway claimed was inconsistent with Article 6.10 as it excluded all non-producing exporters from being considered for selection. The Panel considered the text of Article 6.10, and particularly the use of the word “or”, along with contextual support from Article 2.5:

“[W]e find it particularly telling that the drafters of the AD Agreement chose to use the word ‘or’ and not the word ‘and’ in agreeing on the text of [Article 6.10]. This choice of language suggests the drafters intended that Members be left with discretion to choose the focus of their investigations.”⁽⁸⁷⁴⁾

 

“Thus, in our view, the ordinary meaning of the first sentence of Article 6.10 suggests that the ‘known exporter[s] or producer[s]’ that serve as the starting point for the selection of the interested parties investigated under either of the two limited investigation techniques described in the second sentence of Article 6.10, do not always have to be all known exporters and all known producers. We see no provision in the AD Agreement that would explicitly prohibit such interpretation of Article 6.10.”⁽⁸⁷⁵⁾

 

“We also find contextual support for our reading of the text of the first sentence of Article 6.10 in Article 2.5 of the AD Agreement. We consider significant that the drafters of this provision of the AD Agreement made explicit allowance for the possibility that Members may, in certain situations, focus their investigation into the existence of dumping on the pricing behaviour of producers, notwithstanding the existence of known exporters responsible for making the export sales under investigation.”⁽⁸⁷⁶⁾

635.   In US — Shrimp (Viet Nam), the Panel rejected a claim by Viet Nam that the limited examinations conducted by the US Department of Commerce, by failing to provide non-selected respondents with individual margins of dumping, violated Articles 9.3, 11.1 and 11.3. The Panel stated that “the use of limited examinations is governed exclusively by the second sentence of Article 6.10” and that “the exception provided for in the second sentence of Article 6.10 makes it clear that, despite the general preference for individual margins, investigating authorities need not determine individual margins for all known exporters and producers in all cases.”⁽⁸⁷⁷⁾

(d) “the largest percentage of exports that could reasonably be investigated”

636.   The Panel in EC — Salmon (Norway) had to consider the question whether an investigating authority acted inconsistently with the second sentence of Article 6.10 by not investigating two producers that allegedly exported a larger volume of salmon to the European Communities than several of the companies actually investigated. The Panel found that the investigating authority (i.e. the European Communities) acted inconsistently with Article 6.10 in one instance, but not in the other:

“In our view, the volume of export sales that may be reasonable for an investigating authority to investigate is a question that must be assessed on a case-by-case basis, taking into account all relevant facts that are before the investigating authority, including the nature and type of interested parties, the products involved and the investigating authorities own investigating capacity and resources.”⁽⁸⁷⁸⁾

637. The Panel in EC — Salmon (Norway) continued that the second sentence of Article 6.10 concerned not the largest percentage of the volume of exports, but rather the largest percentage of the volume of exports that it would be reasonable for an investigating authority to investigate.

“However, to the extent that it refers to the largest percentage of the volume of exports which can ‘reasonably’ be investigated, the text of the second sentence of Article 6.10 suggests that such an outcome was not intended. In particular, the word ‘reasonably’ implies that the objective of this limited examination technique is to identify the largest percentage of the volume of exports that it would be reasonable for an investigating authority to investigate.”⁽⁸⁷⁹⁾

 

“In our view, the volume of export sales that may be reasonable for an investigating authority to investigate is a question that must be assessed on a case-by-case basis, taking into account all relevant facts that are before the investigating authority, including the nature and type of interested parties, the products involved and the investigating authority’s own investigating capacity and resource. We see no reason why this assessment might not also be informed by the matters raised during consultations pursuant to Article 6.10.1”⁽⁸⁸⁰⁾

(e) Article 6.10.2

638.   The Panel in US — Shrimp (Viet Nam), examining claims by Viet Nam under Article 6.10.2, noted that “the application of the first sentence of Article 6.10.2 is only triggered if non-selected exporters or producers make so-called voluntary responses. If no such voluntary response is submitted, there is no obligation on the investigating authority to take any action under the first sentence of Article 6.10.2.”⁽⁸⁸¹⁾

10. Article 6.13

(a) Relationship with paragraphs 2 and 5 of Annex II

639.   In US — Hot-Rolled Steel, the Appellate Body referred to Article 6.13 as support for its view that paragraphs 2 and 5 of Annex II call for a balance between the interests of investigating authorities and exporters as regards cooperation in anti-dumping investigations. See paragraph 583 above.

11. Relationship with other Articles and other WTO Agreements

(a) Article 1, 9 and 18 and Article VI of the GATT 1994

640.   In Guatemala — Cement II, the Panel found that the subject anti-dumping duty order of Guatemala was inconsistent with several articles of the Anti-Dumping Agreement, including Article 7. The Panel then opined that Mexico’s claims under Article 1, 9 and 18 of the Anti-Dumping Agreement, and Article VI of GATT 1994, were “dependent claims, in the sense that they depend entirely on findings that Guatemala has violated other provisions of the AD Agreement.”⁽⁸⁸²⁾ In light of this dependent nature of Mexico’s claim, the Panel considered it not necessary to address these claims. See paragraph 9 above.

(b) Article 2

641.   In US — Stainless Steel (Korea), the Panel considered that it was unnecessary to examine Korea’s claim using Articles 6.1, 6.2 and 6.9 with respect to the United States’ methodologies which the Panel had already found in violation of Article 2.⁽⁸⁸³⁾

642.   With respect to the relationship between Article 6.8 and Articles 2.2 and 2.4, see paragraph 161 above.

643.   In Argentina — Ceramic Tiles, the Argentine authorities had established a dumping margin for three size categories of ceramic tiles irrespective of the exporter. The Panel, when analysing the compatibility of Argentina’s measure with Article 6.10, acknowledged the “usefulness of grouping (by size, model, type) for the purpose of making a fair comparison under Article 2.4” but indicated that this should not be confused with “the requirement under Article 6.10 to determine an individual margin of dumping for the product as a whole.”⁽⁸⁸⁴⁾

(c) Article 3

644.   In Thailand — H-Beams, the Appellate Body referred to Article 6 in interpreting Article 3.1. See paragraph 186 above.

(d) Article 9

645.   With respect to the relationship between Article 6.8 and Article 9.3 and 9.4, see paragraphs 719–720 below.

(e) Article 12

646.   The Panel in Argentina — Ceramic Tiles referred to Article 12 of the Anti-Dumping Agreement as support of its conclusion above that an investigating authority may rely on confidential information in making determinations while respecting its obligation to protect the confidentiality of that information. See paragraph 599 above.

 

back to top

VIII. Article 7  

A. Text of Article 7

Article 7: Provisional Measures

7.1   Provisional measures may be applied only if:

 

(i)   an investigation has been initiated in accordance with the provisions of Article 5, a public notice has been given to that effect and interested parties have been given adequate opportunities to submit information and make comments;

 

(ii)   a preliminary affirmative determination has been made of dumping and consequent injury to a domestic industry; and

 

(iii)   the authorities concerned judge such measures necessary to prevent injury being caused during the investigation.

 

7.2   Provisional measures may take the form of a provisional duty or, preferably, a security — by cash deposit or bond — equal to the amount of the anti-dumping duty provisionally estimated, being not greater than the provisionally estimated margin of dumping. Withholding of appraisement is an appropriate provisional measure, provided that the normal duty and the estimated amount of the anti-dumping duty be indicated and as long as the withholding of appraisement is subject to the same conditions as other provisional measures.

 

7.3   Provisional measures shall not be applied sooner than 60 days from the date of initiation of the investigation.

 

7.4   The application of provisional measures shall be limited to as short a period as possible, not exceeding four months or, on decision of the authorities concerned, upon request by exporters representing a significant percentage of the trade involved, to a period not exceeding six months. When authorities, in the course of an investigation, examine whether a duty lower than the margin of dumping would be sufficient to remove injury, these periods may be six and nine months, respectively.

 

7.5   The relevant provisions of Article 9 shall be followed in the application of provisional measures.

B. Interpretation and Application of Article 7

1. General

647.   In Guatemala — Cement II, after having found that the subject definitive measure was inconsistent with the Anti-Dumping Agreement, the Panel considered it unnecessary to address claims concerning the provisional measure, stating:

“At most, Mexico’s claims concerning the provisional measure could only result in a ruling with respect to part of the definitive measure insofar as it relates to retrospective collection of the provisional measure (i.e., where it is mandated that the ‘provisional anti-dumping duties collected would remain in favour of the treasury’). Since we have already made findings that give rise to a recommendation concerning the totality of the definitive measure, we do not consider it necessary to further address claims (i.e. concerning the provisional measure) that could only result in a ruling concerning only part of the definitive measure.”⁽⁸⁸⁵⁾

648.   The Panel in Mexico — Corn Syrup found that Mexico’s application of provisional measures for more than six months violated Article 7.4.⁽⁸⁸⁶⁾

649.   In US — Customs Bond Directive, India asserted that the enhanced bond requirement (EBR) was inconsistent with Article 7.2 “since provisional measures, whether in the form of a cash deposit or bond, may not be for an amount in excess of the ‘provisionally estimated margin of dumping’ or the ‘provisional calculated amount of subsidization’, as the case may be.” The Panel agreed:

“In accordance with Article 7.2 of the Anti-Dumping Agreement, provisional measures may not exceed ‘the amount of the anti-dumping duty provisionally estimated.’ Since the United States applied initial provisional measures in ‘the amount of the anti-dumping duty provisionally estimated’, the application of the EBR (prior to imposition of the anti-dumping order) in conjunction with the initial provisional measures necessarily resulted in the imposition of provisional measures (i.e., the initial provisional measures together with the EBR) in excess of ‘the amount of the anti-dumping duty provisionally estimated,’ contrary to Article 7.2 of the Anti-Dumping Agreement.”⁽⁸⁸⁷⁾

2. Relationship with other Articles and other WTO Agreements

(a) Article 1, 9 and 18 and Article VI of the GATT 1994

650.   In Guatemala — Cement II, the Panel found that the subject anti-dumping duty order of Guatemala was inconsistent with several articles of the Anti-Dumping Agreement, including Article 7. The Panel then opined that Mexico’s claims under Article 1, 9 and 18 of the Anti-Dumping Agreement, and Article VI of GATT 1994, were “dependent claims, in the sense that they depend entirely on findings that Guatemala has violated other provisions of the AD Agreement.”⁽⁸⁸⁸⁾ In light of this dependent nature of Mexico’s claim, the Panel considered it not necessary to address these claims. See paragraph 9 above.

(b) Article 6

651.   In Guatemala — Cement II, the Panel referred to Article 7.3 in examining Mexico’s claim under Article 6.1.3. See paragraph 453 above.

(c) Article 17

652.   In Mexico — Corn Syrup, the Panel touched on the relationship between Article 7 (Articles 7.1 and 7.4) and Article 17.4. See paragraphs 894–895 below.

(d) Article VI of the GATT 1994

653.   In US — Shrimp (Thailand)/US — Customs Bond Directive, the Appellate Body examined the relationship between reasonable security requirements provided for by the Note Ad Paragraphs 2 and 3 of Article VI of the GATT 1994, and provisional measures under Article 7 of the Anti-Dumping Agreement. The complainants argued that the scope of the Ad Note should be limited to securities taken as a provisional measure pursuant to Article 7. The Appellate Body observed:

“We agree … that there is some overlap between the Ad Note and Article 7. The Ad Note allows security in the form of provisional measures during the original investigation period, the disciplines of which are implemented through Article 7. At the same time, in our view, the Ad Note allows the taking of a reasonable security for payment of the final liability of anti-dumping duties after an anti-dumping duty order has been imposed where such security may be needed to ensure that the difference between the duty collected on import entries and the final duty liability is collected. We therefore do not agree … that the Ad Note is completely subsumed under Article 7 so that the taking of a reasonable security is not allowed after a definitive anti-dumping duty is imposed. As the Appellate Body clarified in Brazil — Desiccated Coconut, the Anti-Dumping Agreement does not supersede the provisions of the GATT 1994, including the Notes and Supplementary Provisions of Annex I to the GATT 1994. Rather, Article VI of the GATT 1994 (including the Ad Note) and the Anti-Dumping Agreement represent an inseparable package of rights and disciplines.

 

Our interpretation of the Ad Note is consistent with this approach as it gives meaning and effect to both.⁽⁸⁸⁹⁾

 

back to top

IX. Article 8  

A. Text of Article 8

Article 8: Price Undertakings

8.1   Proceedings may (19) be suspended or terminated without the imposition of provisional measures or antidumping duties upon receipt of satisfactory voluntary undertakings from any exporter to revise its prices or to cease exports to the area in question at dumped prices so that the authorities are satisfied that the injurious effect of the dumping is eliminated. Price increases under such undertakings shall not be higher than necessary to eliminate the margin of dumping. It is desirable that the price increases be less than the margin of dumping if such increases would be adequate to remove the injury to the domestic industry.

 

(footnote original) 19 The word “may” shall not be interpreted to allow the simultaneous continuation of proceedings with the implementation of price undertakings except as provided in paragraph 4.

 

8.2   Price undertakings shall not be sought or accepted from exporters unless the authorities of the importing Member have made a preliminary affirmative determination of dumping and injury caused by such dumping.

 

8.3   Undertakings offered need not be accepted if the authorities consider their acceptance impractical, for example, if the number of actual or potential exporters is too great, or for other reasons, including reasons of general policy. Should the case arise and where practicable, the authorities shall provide to the exporter the reasons which have led them to consider acceptance of an undertaking as inappropriate, and shall, to the extent possible, give the exporter an opportunity to make comments thereon.

 

8.4   If an undertaking is accepted, the investigation of dumping and injury shall nevertheless be completed if the exporter so desires or the authorities so decide. In such a case, if a negative determination of dumping or injury is made, the undertaking shall automatically lapse, except in cases where such a determination is due in large part to the existence of a price undertaking. In such cases, the authorities may require that an undertaking be maintained for a reasonable period consistent with the provisions of this Agreement. In the event that an affirmative determination of dumping and injury is made, the undertaking shall continue consistent with its terms and the provisions of this Agreement.

 

8.5   Price undertakings may be suggested by the authorities of the importing Member, but no exporter shall be forced to enter into such undertakings. The fact that exporters do not offer such undertakings, or do not accept an invitation to do so, shall in no way prejudice the consideration of the case. However, the authorities are free to determine that a threat of injury is more likely to be realized if the dumped imports continue.

 

8.6   Authorities of an importing Member may require any exporter from whom an undertaking has been accepted to provide periodically information relevant to the fulfilment of such an undertaking and to permit verification of pertinent data. In case of violation of an undertaking, the authorities of the importing Member may take, under this Agreement in conformity with its provisions, expeditious actions which may constitute immediate application of provisional measures using the best information available. In such cases, definitive duties may be levied in accordance with this Agreement on products entered for consumption not more than 90 days before the application of such provisional measures, except that any such retroactive assessment shall not apply to imports entered before the violation of the undertaking.

B. Interpretation and Application of Article 8

654.   The Panel in US — Offset Act (Byrd Amendment) considered the extent of the obligation under Article 8.3 of the Anti-Dumping Agreement and Article 18.3 of the SCM Agreement concerning price undertakings. According to the Panel, under Article 8:

“AD Article 8 and SCM 18 provide that when offered, the investigating authority need not accept the undertaking if it considers it impractical or if for other reasons it does not want to accept the undertaking. The decision to accept an undertaking or not under the Agreements is one the investigating authority is to take, and it may reject an undertaking for various reasons, including reasons of general policy. The fact that domestic producers may or may not be influenced by the CDSOA to suggest to the authority not to accept the undertaking, does not affect the possibility for interested parties concerned to offer an undertaking or for that undertaking to be accepted, in light of the non-decisive role of the domestic industry in this process.

 

In addition we note that the text of AD Article 8.3 and SCM Article 18.3 does not require the authority to examine objectively any undertaking offered. Rather, it stresses that undertakings offered need not be accepted and that the reasons for rejecting an undertaking may be manifold and include reasons of general policy. In our view, the CDSOA cannot be found to impede the objective examination of the appropriateness of accepting an undertaking, in the absence of any such obligation under AD Article 8 and SCM 18.”⁽⁸⁹⁰⁾

655.   In EC — Fasteners (China), the Panel observed that “[u]nder Article 8 of the AD Agreement, undertakings to revise prices or cease exports at dumped prices can be accepted only from individual exporters, following at least a preliminary determination of dumping”.⁽⁸⁹¹⁾ The Panel then noted that:

“This is in contrast to the parallel provision of the SCM Agreement, Article 18, which specifically provides for the acceptance of undertakings from the government of the exporting Member to eliminate or limit the subsidy, or take other measures concerning its effects. In our view, this difference reflects the fact that subsidization is a matter of government action, while dumping is, in general, a consequence of pricing decisions by commercial enterprises.”⁽⁸⁹²⁾

 

back to top

X. Article 9  

A. Text of Article 9

Article 9: Imposition and Collection of Anti-Dumping Duties

9.1   The decision whether or not to impose an antidumping duty in cases where all requirements for the imposition have been fulfilled, and the decision whether the amount of the anti-dumping duty to be imposed shall be the full margin of dumping or less, are decisions to be made by the authorities of the importing Member. It is desirable that the imposition be permissive in the territory of all Members, and that the duty be less than the margin if such lesser duty would be adequate to remove the injury to the domestic industry.

 

9.2   When an anti-dumping duty is imposed in respect of any product, such anti-dumping duty shall be collected in the appropriate amounts in each case, on a non discriminatory basis on imports of such product from all sources found to be dumped and causing injury, except as to imports from those sources from which price undertakings under the terms of this Agreement have been accepted. The authorities shall name the supplier or suppliers of the product concerned. If, however, several suppliers from the same country are involved, and it is impracticable to name all these suppliers, the authorities may name the supplying country concerned. If several suppliers from more than one country are involved, the authorities may name either all the suppliers involved, or, if this is impracticable, all the supplying countries involved.

 

9.3   The amount of the anti-dumping duty shall not exceed the margin of dumping as established under Article 2.

 

9.3.1   When the amount of the anti-dumping duty is assessed on a retrospective basis, the determination of the final liability for payment of anti-dumping duties shall take place as soon as possible, normally within 12 months, and in no case more than 18 months, after the date on which a request for a final assessment of the amount of the anti-dumping duty has been made.(20) Any refund shall be made promptly and normally in not more than 90 days following the determination of final liability made pursuant to this subparagraph. In any case, where a refund is not made within 90 days, the authorities shall provide an explanation if so requested.

 

(footnote original) 20 It is understood that the observance of the time limits mentioned in this subparagraph and in subparagraph 3.2 may not be possible where the product in question is subject to judicial review proceedings.

 

9.3.2   When the amount of the anti-dumping duty is assessed on a prospective basis, provision shall be made for a prompt refund, upon request, of any duty paid in excess of the margin of dumping. A refund of any such duty paid in excess of the actual margin of dumping shall normally take place within 12 months, and in no case more than 18 months, after the date on which a request for a refund, duly supported by evidence, has been made by an importer of the product subject to the anti-dumping duty. The refund authorized should normally be made within 90 days of the above-noted decision.

 

9.3.3   In determining whether and to what extent a reimbursement should be made when the export price is constructed in accordance with paragraph 3 of Article 2, authorities should take account of any change in normal value, any change in costs incurred between importation and resale, and any movement in the resale price which is duly reflected in subsequent selling prices, and should calculate the export price with no deduction for the amount of anti-dumping duties paid when conclusive evidence of the above is provided.

 

9.4   When the authorities have limited their examination in accordance with the second sentence of paragraph 10 of Article 6, any anti-dumping duty applied to imports from exporters or producers not included in the examination shall not exceed:

 

(i)   the weighted average margin of dumping established with respect to the selected exporters or producers or,

 

(ii)   where the liability for payment of anti-dumping duties is calculated on the basis of a prospective normal value, the difference between the weighted average normal value of the selected exporters or producers and the export prices of exporters or producers not individually examined,

 

provided that the authorities shall disregard for the purpose of this paragraph any zero and de minimis margins and margins established under the circumstances referred to in paragraph 8 of Article 6. The authorities shall apply individual duties or normal values to imports from any exporter or producer not included in the examination who has provided the necessary information during the course of the investigation, as provided for in subparagraph 10.2 of Article 6.

 

9.5   If a product is subject to anti-dumping duties in an importing Member, the authorities shall promptly carry out a review for the purpose of determining individual margins of dumping for any exporters or producers in the exporting country in question who have not exported the product to the importing Member during the period of investigation, provided that these exporters or producers can show that they are not related to any of the exporters or producers in the exporting country who are subject to the anti-dumping duties on the product. Such a review shall be initiated and carried out on an accelerated basis, compared to normal duty assessment and review proceedings in the importing Member. No anti-dumping duties shall be levied on imports from such exporters or producers while the review is being carried out. The authorities may, however, withhold appraisement and/or request guarantees to ensure that, should such a review result in a determination of dumping in respect of such producers or exporters, antidumping duties can be levied retroactively to the date of the initiation of the review.

B. Interpretation and Application of Article 9

1. General

656.   In US — Customs Bond Directive, the Panel examined a claim that an enhanced bond requirement (EBR) for certain shrimp, imposed pursuant to the Amended Customs Bond Directive (Amended CBD) was inconsistent with Article 9. The Appellate Body upheld the Panel’s finding that bonds provided under the Amended CBD are not anti-dumping duties or countervailing duties, fall outside the scope of Articles 9 of the Anti-Dumping Agreement and 19 of the SCM Agreement, and consequently are not inconsistent as such with Articles 9.1, 9.2, 9.3 and 9.3.1 of the Agreement nor with Articles 19.2, 19.3 and 19.4 of the SCM Agreement:⁽⁸⁹³⁾

“A bond under the Amended CBD secures the payment of a duty. A bond, by itself, is not a duty as it does not entail any transfer of money from the importer to the government. Therefore, the EBR imposed pursuant to the Amended CBD cannot be characterized as a ‘duty’ within the meaning of Article 9 of the Anti-Dumping Agreement and Article 19 of the SCM Agreement.”⁽⁸⁹⁴⁾

657.   As the text of certain provisions in Article 19 of the SCM Agreement parallels the text of provisions in Article 9 of the Anti-Dumping Agreement, see also the cases and materials on those provisions under Article 19 in the Chapter on the SCM Agreement.

2. Article 9.1

658.   The Appellate Body in EC — Fasteners (China) observed that the second sentence of Article 9.1 expresses a “preference… for duties lesser than the margin of dumping, if lesser duties are adequate to remove the injury to the domestic industry. To express such a preference, Article 9.1 uses the expression ‘it is desirable’.”⁽⁸⁹⁵⁾

659.   See also paragraph 696 below.

3. Article 9.2

(a) General; mandatory nature of Article 9.2

660.   In EC — Fasteners (China), the Appellate Body summarized its interpretation of Article 9.2:

“Article 9.2 of the Anti-Dumping Agreement requires investigating authorities to specify an individual duty for each supplier, except where this is impracticable, when several suppliers are involved. We reach this conclusion by reading the first sentence of Article 9.2 in conjunction with the second sentence of Article 9.2. The first sentence requires investigating authorities to collect anti-dumping duties in the appropriate amounts in each case and on a non-discriminatory basis on imports from all sources — that is, suppliers — while the second sentence requires investigating authorities to name the supplier or suppliers of the product concerned. We also consider that the exception in the third sentence of Article 9.2 does not allow the imposition of a single country-wide antidumping duty in investigations involving NMEs where the imposition of individual duties is alleged to be ‘ineffective’, but is not ‘impracticable’.”⁽⁸⁹⁶⁾

661.   The Appellate Body in EC — Fasteners (China) interpreted Article 9.2: “It is … clear from the wording of this provision, which uses the auxiliary verb ‘shall’, that the collection in appropriate amounts of antidumping duties and the naming of the supplier are of a mandatory nature.”⁽⁸⁹⁷⁾

662.   See also the discussion of EC — Fasteners (China) under Article 6.10.

(b) “appropriate amounts”

663.   The Panel in Argentina — Poultry Anti-Dumping Duties made the following observations concerning the relationship between Article 9.2 and Article 9.3:

“We note that Article 9.3 contains a specific obligation regarding the amount of anti-dumping duty to be imposed, whereas Article 9.2 employs far more general language in referring to the collection of duties in ‘appropriate’ amounts. In particular, Article 9.2 provides no guidance on what an ‘appropriate’ amount of duty may be in a given case. In the absence of any other guidance regarding the appropriateness of the amount of anti-dumping duties, it would appear reasonable to conclude that an anti-dumping duty meeting the requirements of Article 9.3 (i.e., not exceeding the margin of dumping) would be ‘appropriate’ within the meaning of Article 9.2.”⁽⁸⁹⁸⁾

664.   The Panel in EC — Salmon (Norway) concluded that in order to comply with the Article 9.2 requirement that anti-dumping duties must be collected in the “appropriate amounts”, “Members imposing minimum import prices (MIPs) on investigated parties must ensure that they do not exceed their respective normal values.”⁽⁸⁹⁹⁾ The Panel found important contextual support for this in Article 9.4:

“[T]he last sentence of Article 9.4 explicitly recognizes that the benchmark for a MIP applied to any individual exporter or producer that has provided information of the kind that could result in the calculation of an individual margin of dumping in accordance with Article 6.10.2, may be equivalent to its ‘individual … normal values’.”⁽⁹⁰⁰⁾

665.   The Panel in EC — Salmon (Norway) found that the investigating authority did not act consistently with the obligation in Article 9.2 to ensure duties were collected in the “appropriate amounts”:

“We recall that the MIPs established by the investigating authority were based on the ‘non-injurious’ MIPs, because these were found to be lower than the ‘non-dumped’ MIPs. To the extent that we have found that the ‘non-dumped’ MIPs calculated by the investigating authority were greater than the relevant normal values, greater than what they should have been or derived through the application of a flawed methodology, the investigating authority’s finding that the ‘non-injurious’ MIPs were less than the ‘non-dumped’ MIPs rested on a flawed factual basis. Thus, in imposing the MIPs on the investigated parties at the level of the ‘non-injurious’ MIPs, the investigating authority did not act consistently with the obligation to ensure that anti-dumping duties must be collected in the ‘appropriate amounts’, within the meaning of Article 9.2 of the AD Agreement.”⁽⁹⁰¹⁾

666.   The Appellate Body in EC — Fasteners (China) found that the “appropriate amount” of an antidumping duty that can be imposed must be an individual one, not a country-wide rate:

“Article 6.10 of the Anti-Dumping Agreement contains an obligation to determine individual dumping margins for each exporter or producer, except when sampling is used or if a derogation is otherwise provided for in the covered agreements. We observe that, where an individual margin of dumping has been determined, it flows from the obligation contained in the first sentence of Article 9.2 that the appropriate amount of anti-dumping duty that can be imposed also has to be an individual one. We do not see how an importing Member could comply with the obligation in the first sentence of Article 9.2 to collect duties in the appropriate amounts in each case if, having determined individual dumping margins, it lists suppliers by name, but imposes country-wide duties. In other words, unless sampling is used, the appropriate amount of an anti-dumping duty in each case is one that is specified by supplier, as further clarified and confirmed by the obligation to name suppliers in the second sentence of Article 9.2.⁽⁹⁰²⁾”⁽⁹⁰³⁾

(c) “all sources”

667.   The Appellate Body in EC — Fasteners (China) upheld a Panel finding interpreting the term “sources” in Article 9.2 as referring to individual exporters or producers, and not to the country as a whole:

“Article 9.2 of the Anti-Dumping Agreement requires that anti-dumping duties be collected on a non-discriminatory basis from ‘all sources’ found to be dumped and causing injury, except from ‘those sources’ from which price undertakings have been accepted. We agree with the Panel that the term ‘sources’, which appears twice in the first sentence of Article 9.2, has the same meaning and refers to individual exporters or producers and not to the country as a whole. This is indicated by the fact that price undertakings mentioned in the first sentence of Article 9.2 are accepted, according to Article 8 of the Anti-Dumping Agreement, from individual exporters and not from countries. Therefore, the requirement under Article 9.2 that anti-dumping duties be collected in appropriate amounts in each case and from all sources relates to the individual exporters or producers subject to the investigation.”⁽⁹⁰⁴⁾

668.   The Panel in EC — Fasteners (China) drew a contrast between Article 9.2 and “the parallel provision of the SCM Agreement, Article 18, which specifically provides for the acceptance of undertakings from the government of the exporting Member to eliminate or limit the subsidy, or take other measures concerning its effects. In our view, this difference reflects the fact that subsidization is a matter of government action, while dumping is, in general, a consequence of pricing decisions by commercial enterprises.”⁽⁹⁰⁵⁾

(d) “The authorities shall name the supplier or suppliers of the product concerned”

669.   The Appellate Body in EC — Fasteners (China) also found that “the obligation to name individual suppliers in the second sentence of paragraph 2 is closely related to the imposition of individual anti-dumping duties and … the requirement to name suppliers that are subject to imposition and collection of antidumping duties should be interpreted as a requirement to specify duties for each supplier.”⁽⁹⁰⁶⁾

(e)   Third sentence of Article 9.2

670.   In EC — Fasteners (China), the Appellate Body discussed whether the exception in the third sentence of Article 9.2 would justify imposition of country-wide rates on suppliers that are all related to the State in order to avoid circumvention. The Appellate Body observed that “Article 9.2, third sentence, allows Members to name the supplying country concerned only when it is impracticable to name individual suppliers; it does not permit naming the supplying country when the imposition of individual duties is ineffective because it may result in circumvention of the anti-dumping duties.”⁽⁹⁰⁷⁾

4. Article 9.3

(a) “de minimis” test

671.   The Panel in US — DRAMS concluded that “Article 5.8, second sentence, does not apply in the context of Article 9.3 duty assessment procedures. As Article 5.8, second sentence, does not require Members to apply a de minimis test in Article 9.3 duty assessment procedures, it certainly cannot require Members to apply a particular de minimis standard in such procedures.”⁽⁹⁰⁸⁾

672.   The Panel in US — DRAMS further stated:

“A de minimis test in the context of an Article 9.3 duty assessment will not remove an exporter from the scope of the order. Thus, the implication of the de minimis test required by Article 5.8, and any de minimis test that Members choose to apply in Article 9.3 duty assessment procedures, differ significantly.”⁽⁹⁰⁹⁾

673.   The Panel in US — DRAMS discussed the different functions of the de minimis test in Article 5.8 and Article 9.3, respectively. See paragraph 402 above.

(b) Variable duties

674.   The Panel in Argentina — Poultry Anti-Dumping Duties addressed the argument that variable antidumping duties are inconsistent with Article 9.3 because they are collected by reference to a margin of dumping established at the time of collection (i.e., the difference between a “minimum export price”, or reference normal value, and actual export price), rather than by reference to the margin of dumping established during the investigation. Brazil argued that from the moment the anti-dumping duty is imposed until a review of the imposition of that duty is made, the only margin of dumping available, calculated pursuant to Article 2, is the margin assessed in the investigation, and found in the final determination. The Panel rejected this argument and concluded that Article 9.3 does not prohibit the use of variable anti-dumping duties:

“In addressing this claim, we note that nothing in the AD Agreement explicitly identifies the form that antidumping duties must take. In particular, nothing in the AD Agreement explicitly prohibits the use of variable antidumping duties. Brazil’s Claim 29 is based on Article 9.3 of the AD Agreement. As the title of Article 9 of the AD Agreement suggests, Article 9.3 is a provision concerning the imposition and collection of anti-dumping duties. Article 9.3 provides that a duty may not be collected in excess of the margin of dumping as established under Article 2. The modalities for ensuring compliance with this obligation are set forth in sub-paragraphs 1, 2 and 3 of Article 9.3, each of which addresses duty assessment and the reimbursement of excess duties. The primary focus of Article 9.3, read together with sub-paragraphs 1–3, is to ensure that final anti-dumping duties shall not be assessed in excess of the relevant margin of dumping, and to provide for duty refund in cases where excessive anti-dumping duties would otherwise be collected. Our understanding that Article 9.3 is concerned primarily with duty assessment is confirmed by the fact that the broadly equivalent provision in the SCM Agreement (i.e., Article 19.4) refers to the ‘lev[ying]’ of duties, and footnote 51 to that provision states that ‘ “levy” shall mean the definitive or final legal assessment or collection of a duty or tax’ (emphasis added).⁽⁹¹⁰⁾ When viewed in this light, it is not obvious that — as Brazil effectively argues — Article 9.3 prohibits variable anti-dumping duties by ensuring that anti-dumping duties do not exceed the margin of dumping established during ‘the investigation phase’ pursuant to Article 2.4.2. Neither the ordinary meaning of Article 9.3, nor its context (i.e., sub-paragraphs 1–3), supports that view. If Article 9.3 were designed to prohibit the use of variable customs duties, presumably that prohibition would have been clearly spelled out.”⁽⁹¹¹⁾

675.   The Panel also pointed to Article 9.3.1 dealing with retrospective duty assessment as support for its view that duties may be collected on the basis of a margin of dumping established after the end of the investigation.⁽⁹¹²⁾ Similarly, the Panel considered that the Article 9.3.2 refund mechanism in the case of a prospective duty assessment would include refunds of anti-dumping duties paid in excess of the margin of dumping prevailing at the time the duty is collected and drew the following conclusions:

“This therefore further undermines Brazil’s argument that the only margin of dumping relevant until such time that there is an Article 11.2 review is the margin established during the investigation. If the basis for duty refund is the margin of dumping prevailing at the time of duty collection, we see no reason why a Member should not use the same basis for duty collection. Brazil has noted that refunds do not imply modification of the duty, and are only available if requested by the importer.⁽⁹¹³⁾ While these points may be correct, they do not change the fact that the refund mechanism operates by reference to the margin of dumping prevailing at the time of duty collection. It is this aspect of the refund mechanism that renders it contextually relevant to the issue before us. Accordingly, we see no reason why it is not permissible⁽⁹¹⁴⁾ for a Member to levy anti-dumping duties on the basis of the actual margin of dumping prevailing at the time of duty collection.”⁽⁹¹⁵⁾

(c) Conditions to carry out duty assessment and changed circumstances reviews

(i) Exhaustiveness of the conditions listed

676.   In Mexico — Anti-Dumping Measures on Rice, the Appellate Body held that the conditions to carry out duty assessment reviews and changed circumstances reviews listed in Articles 9.3.2 and 11.2 of the Anti-Dumping Agreement and Article 21.2 of the SCM Agreement are exhaustive, and do not include a requirement to condition a review on a showing of representative volume of exports:

“[T]he above provisions … require an investigating authority to undertake duty assessment reviews and changed circumstances reviews once the conditions set out in those provisions have been satisfied. In our view, these conditions are exhaustive; thus, if an agency seeks to impose additional conditions on a respondent’s right to a review, this would be inconsistent with those provisions”.⁽⁹¹⁶⁾

677.   The Appellate Body confirmed that the completion of judicial proceedings as a condition for carrying out duty assessment and changed circumstances reviews is not provided for in Articles 9.3.2 of the Anti-Dumping Agreement and 11.2 and Article 21.2 of the SCM Agreement.⁽⁹¹⁷⁾

(ii) When a duty becomes final

678.   The Appellate Body in Mexico — Anti-Dumping Duties on Rice agreed with the Panel that “a duty becomes ‘definitive’ — and therefore satisfies one of the conditions for a review set out in Articles 9.3 and 11.2 of the Anti-Dumping Agreement and Article 21.2 of the SCM Agreement — at the time of the investigating authority’s final affirmative determination” and that “a product is subject to a duty as soon as an investigation has been concluded and a final determination has been made deciding to impose anti-dumping or countervailing duties.”⁽⁹¹⁸⁾ The Appellate Body concluded that these provisions:

“[P]ermit agencies to require that duties be imposed on a product — in the sense that a final determination be made, following an original investigation, with respect to the anti-dumping/countervailing duty liability for entries of such product — as a condition of the right to a refund or review of duties … Where duties have been imposed, and the remaining conditions of these treaty provisions satisfied, an investigating authority is not permitted to decline a request for a duty assessment or changed circumstances review.”⁽⁹¹⁹⁾

(d) Concept of “product as a whole” in reviews under Article 9 of the Anti-Dumping Agreement

679.   Article 9 covers the “Imposition and Collection of Anti-Dumping Duties”. The Panel in US — Zeroing (Japan) summarized the operation of the Article:

“Article 9.3 requires that the amount of the anti-dumping duty not exceed the margin of dumping as established under Article 2. Articles 9.3.1 and 9.3.2 specify certain rules to implement this requirement when the amount of the anti-dumping duty is assessed on a retrospective basis (Article 9.3.1) or on a prospective basis (Article 9.3.2). In the context of Article 9.3, a margin of dumping is calculated for the purpose of determining the final liability for payment of anti-dumping duties under Article 9.3.1 or for the purpose of determining the amount of anti-dumping duty that must be refunded under Article 9.3.2 ….”⁽⁹²⁰⁾

680.   The Appellate Body in US — Zeroing (Japan) set out its interpretation of Article 9 in relation to the practice of zeroing:

“As the Appellate Body has stated previously, under Article 9.3 of the Anti-Dumping Agreement and Article VI:2 of the GATT 1994, investigating authorities ‘are required to ensure that the total amount of anti-dumping duties collected on the entries of a product from a given exporter shall not exceed the margin of dumping established for that exporter’⁽⁹²¹⁾, in accordance with Article 2.⁽⁹²²⁾ Put differently, ‘the margin of dumping established for an exporter or foreign producer operates as a ceiling for the total amount of anti-dumping duties that can be levied on the entries of the subject product (from that exporter) covered by the duty assessment proceeding.’⁽⁹²³⁾ The Appellate Body has further emphasized that ‘[a]lthough Article 9.3 sets out a requirement regarding the amount of the assessed antidumping duties, it does not prescribe a specific methodology according to which the duties should be assessed.’⁽⁹²⁴⁾ In particular, the Appellate Body has underscored that ‘a reading of Article 9.3 of the Anti-Dumping Agreement and Article VI:2 of the GATT 1994 does not suggest that final anti-dumping duty liability cannot be assessed on a transaction- or importer-specific basis, or that the investigating authorities may not use specific methodologies that reflect the distinct nature and purpose of proceedings governed by these provisions, for purposes of assessing final antidumping duty liability, provided that the total amount of anti-dumping duties that are levied does not exceed the exporters’ or foreign producers’ margins of dumping.’⁽⁹²⁵⁾

 

… the Panel expresses its concern that, if a Member applies a retrospective duty assessment system, it ‘may be precluded from collecting anti-dumping duties in respect of particular export transactions at prices less than normal value to a particular importer at a particular point of time because of prices of export transactions to other importers at a different point in time that exceed normal value.’ This concern is not well founded. The concept of dumping relates to the pricing behaviour of exporters or foreign producers; it is the exporter, not the importer, that engages in practices that result in situations of dumping.⁽⁹²⁶⁾ At the time of importation, an administering authority may collect duties, in the form of a cash deposit, on all export sales, including those occurring at above the normal value. However, in a review proceeding under Article 9.3.1, the authority is required to ensure that the total amount of anti-dumping duties collected from all the importers of that product does not exceed the total amount of dumping found in all sales made by the exporter or foreign producer, calculated according to the margin of dumping established for that exporter or foreign producer without zeroing. The same ‘ceiling’ applies in review proceedings under Article 9.3.2, because the introductory clause of Article 9.3 applies equally to prospective and retroactive duty assessment systems.”⁽⁹²⁷⁾

681.   The Appellate Body in US — Stainless Steel (Mexico) also ruled that zeroing is unacceptable under Article 9.3:

“A proper determination as to whether an exporter is dumping or not can only be made on the basis of an examination of the exporter’s pricing behaviour as reflected in all of its transactions over a period of time… . the determination of dumping with respect to an exporter is properly made not at the level of individual export transactions, but on the basis of the totality of an exporter’s transactions of the subject merchandise over the period of investigation.”⁽⁹²⁸⁾

682.   The Appellate Body in US — Stainless Steel (Mexico) noted, as it had in previous cases, that under Article 9.3 the margin of dumping established for an exporter operated as a ceiling for the total amount of anti-dumping duties that could be levied. The Appellate Body saw no basis for disregarding results of comparisons where the export price exceeded the normal value when calculating the margin of dumping for the exporter. In the view of the Appellate Body, when negotiators sought to permit investigating authorities to disregard certain matters, they did so explicitly.⁽⁹²⁹⁾ Nor did the Appellate Body believe that the text of the Anti-Dumping Agreement supported treating those transactions that occurred above normal value as “dumped” for the purposes of determining the existence and magnitude of dumping in original investigations, but “not dumped” for purposes of periodic reviews:

“First, as noted above, the transactions that are disregarded may well pertain to a model, type, or class that fell within the definition of the product under investigation and were treated as ‘dumped’ in the original investigation. By excluding these transactions at the duty assessment stage, a mismatch is created between the product considered ‘dumped’ and the product as defined by the investigating authority.”⁽⁹³⁰⁾

683.   The Appellate Body in US — Stainless Steel (Mexico) noted further that treating the same transaction differently in periodic reviews from original investigations would create a problem with the injury analysis:

“[T]his treatment is inconsistent with the manner in which injury was determined in the original investigation, where transactions that occurred at above the normal value were taken into account in order to calculate the volume of dumped imports for purposes of injury determination. Obviously, we do not suggest that there need be a fresh injury determination at the duty assessment stage; rather, we wish to point to the contradiction that arises when the same type of transactions are treated as ‘dumped’ for purposes of injury determination in the original investigation and as ‘non-dumped’ in periodic reviews for duty assessment.”⁽⁹³¹⁾

684.   The Appellate Body in US — Stainless Steel (Mexico) was also concerned that providing for different treatment in the case of reviews would provide an opportunity to circumvent the prohibition on zeroing in original investigations under the first sentence of Article 2.4.2:

“In addition, as we see it, a reading of Article 9.3 of the Anti-Dumping Agreement that permits simple zeroing in periodic reviews would allow WTO Members to circumvent the prohibition of zeroing in original investigations that applies under the first sentence of Article 2.4.2 of the Anti-Dumping Agreement. This is because, in the first periodic review after an original investigation, the duty assessment rate for each importer will take effect from the date of the original imposition of anti-dumping duties. Consequently, zeroing would be introduced although it is not permissible in original investigations. We further note that, if no periodic review is requested, the final anti-dumping duty liability for all importers will be assessed at the cash deposit rate applicable to the relevant exporter. When the initial cash deposit rate is calculated in the original investigation without using zeroing, this means that the mere act of conducting a periodic review would introduce zeroing following imposition of the anti-dumping duty order.”⁽⁹³²⁾

685.   The Panel in US — Shrimp (Viet Nam) examined Viet Nam’s claims regarding the use of zeroing in a periodic review. The Panel “recall[ed] that the findings of the Appellate Body in US — Zeroing (Japan) and US — Stainless Steel (Mexico) … addressed the very same question which is now before us, i.e. the consistency with Article 9.3 of the Anti-Dumping Agreement and Article VI:2 of the GATT 1994 of the zeroing methodology, as such, in the context of administrative reviews. Following an objective assessment of the matter, and a thorough review of the abovementioned reasoning expressed by the Appellate Body, we agree with that reasoning and adopt it as our own.”⁽⁹³³⁾ The Panel found that the US zeroing methodology, as such, as it relates to the use of simple zeroing in periodic reviews, is inconsistent with Article 9.3 and Article VI:2.

(e) Retrospective system: reviews and zeroing

686.   The Appellate Body in US — Zeroing (EC) held that the United States’ application of “zeroing” in certain administrative reviews was inconsistent with Article 9.3 and GATT Article VI:2; the Appellate Body noted that Article 9.3 “refers to the margin of dumping as established under Article 2.”⁽⁹³⁴⁾ Referring to its prior Appellate Body decisions on EC — Bed Linen and US — Softwood Lumber V, indicating that, under the Anti-Dumping Agreement and GATT Article VI, “dumping” and “margins of dumping” “must be established for the product under investigation as a whole”,⁽⁹³⁵⁾ the Appellate Body found that under Article 9.3 and Article VI:2, the amount of the assessed anti-dumping duties shall not exceed the margin of dumping as established “for the product as a whole.”⁽⁹³⁶⁾ It then noted that under Article 9.3 of the Anti-Dumping Agreement and Article VI:2 of the GATT 1994, “the margin of dumping established for an exporter or foreign producer operates as a ceiling for the total amount of anti-dumping duties that can be levied on the entries of the subject product (from that exporter) covered by the duty assessment proceeding.”⁽⁹³⁷⁾

687.   However, the Appellate Body in US — Zeroing (EC) upheld the Panel’s finding that zeroing, as applied by the DOC in the administrative reviews at issue, is not inconsistent with Articles 11.1 and 11.2.⁽⁹³⁸⁾ In addressing this issue, the Appellate Body stated that the European Communities had not established that Articles 11.1 and 11.2 apply to the reassessment of the cash-deposit rate in the context of administrative reviews:

“[W]e fail to see how the reassessment of a cash-deposit rate to be applied to future entries could constitute a review of whether the continued imposition of the antidumping duty is necessary to counteract dumping that is causing injury.”⁽⁹³⁹⁾

(f) Prospective normal value system: reviews and zeroing

688.   The Panel in US — Softwood Lumber V (Article 21.5 — Canada) said that if the Appellate Body’s interpretation (as determined in previous cases) of “margins of dumping” was to apply throughout the Anti-Dumping Agreement (i.e. to be determined for the “product as a whole”), it would lead to absurd results under the prospective normal value system. It would mean that “one importer could request a refund on the basis of a margin of dumping calculated by reference to non-dumped transactions made by other importers.”⁽⁹⁴⁰⁾ On appeal, the Appellate Body disagreed with the Panel. In the view of the Appellate Body:

“[the Panel] confuse[d] duty collection at the time of importation with the determination of the final margin of dumping and assessment of final duties in administrative reviews… Under a prospective normal-value system, the anti-dumping duty collected at the time of importation is subject to review and importers have the right to request a refund when the duties paid exceed the actual margin of dumping, pursuant to Article 9.3.2 of the Anti-Dumping Agreement. Accordingly, the operation of prospective normal-value systems has no bearing on the permissibility of zeroing under the transaction-to-transaction comparison methodology in Article 2.4.2.”⁽⁹⁴¹⁾

689.   The Appellate Body in US — Zeroing (Japan) disagreed with the Panel’s general approach to zeroing, including in the context of the prospective normal value system. In disagreeing with the Panel the Appellate Body quoted extensively from the Panel Report:

“Before the Panel, Japan argued that the collection of a variable duty on an entry-by-entry basis under a prospective normal value system does not involve the establishment of margins of dumping with respect to individual export transactions, because the actual margin of dumping in such a system is only determined in a review under Article 9.3.2. Moreover, according to Japan, in a prospective normal value system, ‘the final liability for duties must be assessed in a review under Article 9.3.2’.

 

The Panel disagreed, noting that Japan’s argument was ‘inconsistent with the prospective nature of such a system’.⁽⁹⁴²⁾ The Panel added that ‘[i]t is clear from the text of Article 9.4(ii) of the [Anti-Dumping] Agreement that in a prospective normal value system “liability for payment of anti-dumping duties is calculated on the basis of a prospective normal value”.’⁽⁹⁴³⁾ Moreover, ‘[a]lthough Article 9.3.2 provides for a refund procedure when the amount of anti-dumping duties is assessed on a prospective basis, a requirement that arguably also applies to prospective normal value systems referred to in Article 9.4(ii), a refund procedure in a prospective duty assessment system is not a determination of final liability for payment of antidumping duties.’⁽⁹⁴⁴⁾ The Panel further noted that ‘[t]he phrase “determination of the final liability for payment of anti-dumping duties” is used in Article 9.3.1 in connection with retrospective duty assessment procedures but does not figure in Article 9.3.2.’⁽⁹⁴⁵⁾

 

The Panel stated that, ‘notwithstanding the possibility of a refund, liability for payment of anti-dumping duties is final in a prospective normal value system at the time of importation of a product.’⁽⁹⁴⁶⁾ This may be so, but it does not mean that the anti-dumping duty collected at the time of importation represents a ‘margin of dumping’. Nor does it mean that the total amount of antidumping duties that are levied can exceed the exporter’s or foreign producer’s ‘margin of dumping’. Under a prospective normal value system, exporters may choose to raise their export prices to the level of the prospective normal value in order to avoid liability for payment of anti-dumping duties on each export transaction. However, under Article 9.3.2, the amount of duties collected is subject to review so as to ensure that, pursuant to Article 9.3 of the Anti-Dumping Agreement, the amount of the anti-dumping duty collected does not exceed the margin of dumping as established under Article 2.⁽⁹⁴⁷⁾ It is open to an importer to request a refund if the duties collected exceed the exporter’s margin of dumping. Whether a refund is due or not will depend on the margin of dumping established for that exporter.

 

The Panel stated that, in a prospective normal value system, ‘liability for payment of anti-dumping duties is incurred only to the extent that prices of individual export transactions are below normal value.’⁽⁹⁴⁸⁾ Therefore, Article 9.4(ii) ‘confirms that the concept of dumping can apply on a transaction-specific basis to prices of individual export transactions below the normal value.’⁽⁹⁴⁹⁾ The Panel also stated that ‘[i]f in a prospective normal value system individual export transactions at prices less than normal value can attract liability for payment of anti-dumping duties, without regard to whether or not prices of other export transactions exceed normal value’, there is no reason why duties may not be similarly assessed under the United States’ retrospective duty assessment system.⁽⁹⁵⁰⁾

 

Under any system of duty collection, the margin of dumping established in accordance with Article 2 operates as a ceiling for the amount of anti-dumping duties that could be collected in respect of the sales made by an exporter. To the extent that duties are paid by an importer, it is open to that importer to claim a refund if such a ceiling is exceeded. Similarly, under its retrospective system of duty collection, the United States is free to assess duty liability on a transaction-specific basis, but the total amount of anti-dumping duties that are levied must not exceed the exporters’ or foreign producers’ margins of dumping.

 

The Anti-Dumping Agreement is neutral as between different systems for levy and collection of anti-dumping duties. The Agreement lays down the ‘margin of dumping’ as the ceiling for collection of duties regardless of the duty assessment system adopted by a WTO Member, and provides for a refund if the ceiling is exceeded. It is therefore incorrect to say that the Anti-Dumping Agreement favours one system, or places another system at a disadvantage.”⁽⁹⁵¹⁾

(g) Are “dumping” and “margins of dumping” exporter- or importer-related concepts?

690.   The Appellate Body in US — Zeroing (Japan) disagreed with the Panel’s approach to importer-specific duty assessment. It was an issue that would come up again and be dealt with extensively in US — Stainless Steel (Mexico):

“[T]he Panel expresses its concern that, if a Member applies a retrospective duty assessment system, it ‘may be precluded from collecting anti-dumping duties in respect of particular export transactions at prices less than normal value to a particular importer at a particular point of time because of prices of export transactions to other importers at a different point in time that exceed normal value.’⁽⁹⁵²⁾ This concern is not well founded. The concept of dumping relates to the pricing behaviour of exporters or foreign producers; it is the exporter, not the importer, that engages in practices that result in situations of dumping.⁽⁹⁵³⁾ At the time of importation, an administering authority may collect duties, in the form of a cash deposit, on all export sales, including those occurring at above the normal value. However, in a review proceeding under Article 9.3.1, the authority is required to ensure that the total amount of antidumping duties collected from all the importers of that product does not exceed the total amount of dumping found in all sales made by the exporter or foreign producer, calculated according to the margin of dumping established for that exporter or foreign producer without zeroing. The same ‘ceiling’ applies in review proceedings under Article 9.3.2, because the introductory clause of Article 9.3 applies equally to prospective and retroactive duty assessment systems.”⁽⁹⁵⁴⁾

691.   The Appellate Body in US — Stainless Steel (Mexico) was of the view that “dumping” and “margin of dumping” were exporter-specific concepts, and did not relate to importers. Drawing on other provisions in the Anti-Dumping Agreement to support its view, the Appellate Body noted:

“There is nothing in Articles 5.8, 6.10, and 9.5 of the Anti-Dumping Agreement to suggest that it is permissible to interpret the term ‘margin of dumping’ under those provisions as referring to multiple ‘dumping margins’ occurring at the level of individual importers. Instead, these provisions reinforce the notion that a single margin of dumping is to be established for each individual exporter investigated.

…

 … we disagree with the proposition that importers ‘dump’ and can have ‘margins of dumping’. Dumping arises from the pricing practices of exporters as both normal values and export prices reflect their pricing strategies in home and foreign markets. The fact that ‘dumping’ and ‘margin of dumping’ are exporter-specific concepts under the Anti-Dumping Agreement is not altered by the fact that the export price may be the result of negotiation between the importer and the exporter. Nor is it altered by the fact that it is the importer that incurs the liability to pay anti-dumping duties.”⁽⁹⁵⁵⁾

 

We also disagree with the proposition that the term ‘margin of dumping’ has a different or special meaning in the context of Article 9.3 of the Anti-Dumping Agreement … Although transaction-based multiple comparisons may be necessary in periodic reviews to calculate an importer’s liability for payment of anti-dumping duties, this cannot impart a different or special meaning to the term ‘margin of dumping’ in Article 9.3.”⁽⁹⁵⁶⁾

692.   In US — Stainless Steel (Mexico) the Appellate Body stated that: “A proper determination as to whether an exporter is dumping or not can only be made on the basis of an examination of the exporter’s pricing behaviour as reflected in all of its transactions over a period of time.”⁽⁹⁵⁷⁾ The Appellate Body continued, that in order to address “injurious dumping”, dumping and margin of dumping could not exist at the level of an individual transaction (emphasizing in a footnote that this situation did not address the hypothetical situation of one large import transaction). In addition, it was not possible to have several margins of dumping for a single exporter for the product under consideration. The Appellate Body found no textual support to indicate that the concepts of transaction- and importer-specific dumping and margin of dumping could be confined to duty assessment under Article 9.3.⁽⁹⁵⁸⁾

693.   The Appellate Body in US — Stainless Steel (Mexico) noted that in a prospective normal value system the antidumping duty collected from each importer at the time of importation did not represent a “margin of dumping”. A margin of dumping was for an exporter and applied to all of its sales. A review could be triggered if the ceiling prescribed by Article 9.3 was breached (i.e. the margin of dumping could not exceed the margin established under Article 2). The Appellate Body also repeated its view from earlier decisions that the Anti-Dumping Agreement was neutral as to the different systems for the levy and collection of anti-dumping duties.⁽⁹⁵⁹⁾

694.   The Appellate Body in US — Stainless Steel (Mexico) considered the Panel had misunderstood the Appellate Body’s interpretation of Article 9.3 in previous disputes. The Appellate Body noted that it had consistently held that the total amount of anti-dumping duties assessed and collected from all importers could not exceed the total amount of dumping found in all sales made by the exporter concerned. Its interpretation had not favoured importers with high margins of dumping at the expense of importers who did not dump or dumped at a lower margin. In order to calculate a proper margin of dumping all transactions had to be taken into account. The Appellate Body summarized by saying that it had ruled on the amount of anti-dumping duty that could be levied in accordance with Article 9.3, and not on how that amount was to be collected from the importers.⁽⁹⁶⁰⁾

(h) Relationship with Article 9.2

695.   See paragraph 663 above.

(i) Relationship with Article 2

696.   The Panel in EC — Salmon (Norway) found that the obligation in Article 9.3 to ensure that anti-dumping duties were not collected in excess of the “margin of dumping as established under Article 2” did not require that any anti-dumping duties collected not exceed the margin of dumping calculated in the original investigations:

“[W]e find that the obligation in Article 9.3 to ensure that anti-dumping duties are not collected in excess of the ‘margin of dumping as established under Article 2’ does not require that any anti-dumping duties collected not exceed the margin of dumping calculated in the original investigation. Thus, in the specific context of prospective normal value systems of duty assessment, such as the one applied by the EC in the present investigation, we do not believe that Article 9.3 prevents investigating authorities from collecting anti-dumping duties from investigated parties in excess of the ad valorem equivalent of the margin of dumping calculated in the original investigation, when such an amount of duty represents the difference between an investigated party’s normal value and the export price of the transaction subject to duty assessment. On this basis, we find that Norway has failed to establish that the EC acted inconsistently with Article 9.3 of the AD Agreement and Article VI:2 of the GATT 1994 because of its failure to adopt a mechanism, in the operation of the MIPs it imposed, which ensured that an anti-dumping duty greater than the ad valorem equivalent of the margin of dumping from the original investigation could not be collected.

…

what is important in terms of compliance with Article 9.3 (and Article 9.1) of the AD Agreement is that any duties imposed and collected on investigated parties do not exceed the actual margin of dumping determined on the sales that are subject to duty assessment. In essence, this follows from the fact that pursuant to Article 9.3.2, investigating authorities must refund any duty collected in excess of the ‘actual margin of dumping’ for sales that are subject to duty assessment.”⁽⁹⁶¹⁾

(j) Relationship to the Note Ad Article VI, Paragraphs 2 and 3

697.   In US — Shrimp (Thailand)/US — Customs Bond Directive, the Appellate Body found that the term “final determination” in the Note Ad Paragraphs 2 and 3 of Article VI of the GATT 1994 “includes the determination that is made to assess the final liability for payment of anti-dumping duties under Article 9.3.1 in a retrospective duty assessment system.”⁽⁹⁶²⁾ See the discussion of this issue under Article VI in the Chapter on the GATT 1994.

5. Article 9.4

(a) Purpose of Article 9.4

698.   In US — Hot-Rolled Steel, the Appellate Body indicated that “Article 9.4 seeks to prevent the exporters, who were not asked to cooperate in the investigation, from being prejudiced by gaps or shortcomings in the information supplied by the investigated exporters.”⁽⁹⁶³⁾

699.   The Panel in EC — Salmon (Norway), drawing on the Appellate Body Report in US — Hot Rolled Steel, explained Article 9.4 in the following way:

“Article 9.4 applies when investigating authorities have conducted a limited examination in accordance with Article 6.10 of the AD Agreement. In particular, Article 9.4 applies when an investigating authority has not determined an individual margin of dumping for each known exporter or producer, within the meaning of the first sentence of Article 6.10, and instead determined individual margins of dumping for a limited number of interested parties selected from the known exporters or producers, in accordance with the second sentence of Article 6.10.”⁽⁹⁶⁴⁾

(b) Ceiling for “all others” rate

700.   In US — Hot-Rolled Steel, the Appellate Body explained that Article 9.4 does not provide for a method to calculate the “all others” rate but simply provides for a “ceiling “for such a rate and establishes two “prohibitions” on the use of certain margins in the calculation of the “all others” rate, i.e. not to use (i) zero or de minimis margins and (ii) margins established on the basis of best facts available:

“Article 9.4 does not prescribe any method that WTO Members must use to establish the ‘all others’ rate that is actually applied to exporters or producers that are not investigated. Rather, Article 9.4 simply identifies a maximum limit, or ceiling, which investigating authorities ‘shall not exceed‘ in establishing an ‘all others’ rate. Sub-paragraph (i) of Article 9.4 states the general rule that the relevant ceiling is to be established by calculating a ‘weighted average margin of dumping established’ with respect to those exporters or producers who were investigated. However, the clause beginning with ‘provided that’, which follows this sub-paragraph, qualifies this general rule. This qualifying language mandates that, ‘for the purpose of this paragraph’, investigating authorities ‘shall disregard‘, first, zero and de minimis margins and, second, ‘margins established under the circumstances referred to in paragraph 8 of Article 6.’”⁽⁹⁶⁵⁾

(c) Article 9.4(i): “weighted average margin of dumping with respect to selected exporters or producers”

(i) “margins”

701.    In US — Hot-Rolled Steel, the Appellate Body looked into the meaning of the word “margins” under Article 9.4. The Appellate Body recalled the interpretation made by the Panel of the word “margins” under Article 2.4.2 in EC — Bed Linen and considered that the same meaning should apply to the word “margins” under Article 9.4:

“[W]e recall that the word ‘margins’, which appears in Article 2.4.2 of that Agreement, has been interpreted in European Communities — Bed Linen. The Panel found, in that dispute, and we agreed, that “margins” means the individual margin of dumping determined for each of the investigated exporters and producers of the product under investigation, for that particular product.⁽⁹⁶⁶⁾ This margin reflects a comparison that is based upon examination of all of the relevant home market and export market transactions. We see no reason, in Article 9.4, to interpret the word ‘margins’ differently from the meaning it has in Article 2.4.2, and the parties have not suggested one.”⁽⁹⁶⁷⁾

702.   In EC — Salmon (Norway) the anti-dumping duties applied by the investigating authority to non-investigated cooperating companies took the form of both minimum import prices (MIPs) and a fixed anti-dumping duty. Norway argued that the investigating authority relied on the weighted average margin of dumping for the individually investigated parties when setting the fixed duty. The European Communities disputed this, and argued that the fixed duty was derived instead from the weighted average injury margin, not the weighted average dumping margin for the investigated producers.⁽⁹⁶⁸⁾ Following an analysis of the facts of the case the Panel in EC — Salmon (Norway) found that the investigating authority had acted inconsistently with Article 9.4(i) of the Anti-Dumping Agreement:

“[T]o the extent that it [the investigating authority] determined the fixed duty on the basis of an assessment that relied upon a weighted average margin of dumping for investigated parties that (i) was overstated because it did not take into account downward revisions to the margins of dumping of three individually examined producers; and (ii) was calculated with reliance on a margin of dumping that was based on ‘facts available’ [previously found to be inconsistent with Annex II and Article 6.8], we find that the investigating authority acted inconsistently with Article 9.4(i) of the AD Agreement.”⁽⁹⁶⁹⁾

(ii) “exporters or producers”

703.   Referring to provisions which use the plural form, but which are also applicable in the singular case, the Panel in EC — Bed Linen stated that:

“Article 9.4(i) provides that the dumping duty applied to imports from producers/exporters not examined as part of a sample shall not exceed ‘the weighted average margin of dumping established with respect to the selected exporters or producers’. We consider that this provision does not become inoperative if there is only one selected exporter or producer — rather, the dumping margin for that exporter or producer may be applied.”⁽⁹⁷⁰⁾

704.   However, see paragraph 68 above for a reversal by the Appellate Body of a panel finding under Article 2.2.2(ii) that the plural form “other exporters and producers” could also be interpreted as referring to one single exporter or producer.

(iii) “non-cooperating companies”

705.   In EC — Salmon (Norway), Norway made a claim that was premised on the view that Article 9.4(i) governs the determination of margins of dumping for non-cooperating companies. The Panel rejected this view, clarifying the scope of Article 9.4(i).

“In our view, this does not include exporters and producers that did not identify themselves to the investigating authority for the purpose of being selected in the limited investigation because such exporters or producers could not have been potentially included in the selection of the parties to investigate. Thus, the disciplines in Article 9.4(i) apply only in respect of non-investigated parties that cooperated with the investigating authority for the purpose of selection of the parties that would be subject to a limited investigation. It does not apply in respect of parties that did not cooperate for this purpose.”⁽⁹⁷¹⁾

(d) Prohibitions in the calculation of “all others” rate: zero and de minimis margins, margins based on facts available

(i) Exclusion of margins based on facts available

706.   In US — Hot-Rolled Steel, Japan had claimed that the United States statutory method for calculating the “all others” rate in section 735(c)(5)(A) of the United States Tariff Act of 1930, as amended,⁽⁹⁷²⁾ as well as the authorities’ application of the statutory method were inconsistent with Article 9.4 because they require the consideration of margins based in part on facts available in the calculation of the “all others” rate. The United States contended that only those margins which are calculated entirely on the basis of facts available could not be taken into account for the “all others” rate.⁽⁹⁷³⁾ The Panel found that Article 9.4 excludes from the calculation of the ceiling for the “all others” rate any margins which are calculated, even in part, using facts available.⁽⁹⁷⁴⁾ The Appellate Body, which upheld the Panel’s finding, found that “the application of Article 6.8, authorizing the use of facts available, is not confined to cases where the entire margin is established using only facts available … Article 6.8 may apply in situations where recourse to facts available is needed to cure the lack of even a very small amount of information.”⁽⁹⁷⁵⁾

707.   The Appellate Body then considered that “the ‘circumstances referred to’ in Article 6.8 are the circumstances in which the investigating authorities properly have recourse to ‘facts available’ to overcome a lack of necessary information in the record, …these ‘circumstances’ may, in fact, involve only a small amount of information to be used in the calculation of the individual margin of dumping for an exporter or producer.”⁽⁹⁷⁶⁾

(ii) Calculating an “all others” rate in a “lacuna situation”

708.   In US — Hot-Rolled Steel, the Appellate Body considered how to interpret “margins established under the circumstances referred to in Article 6.8” in Article 9.4. The Appellate Body found that even margins calculated partially on the basis of the facts available were “established under the circumstances referred to” in Article 6.8, and further reasoned that the purpose of Article 9.4 is to prevent exporters who were not asked to cooperate in the investigation from being prejudiced by gaps or shortcomings in the information supplied by the investigated exporters:

“To read Article 9.4 in the way the United States does is to overlook the many situations where Article 6.8 allows a margin to be calculated, in part, using facts available. Yet, the text of Article 9.4 simply refers, in an open-ended fashion, to ‘margins established under the circumstances’ in Article 6.8. Accordingly, we see no basis for limiting the scope of this prohibition in Article 9.4, by reading into it the word ‘entirely’ as suggested by the United States. In our view, a margin does not cease to be ‘established under the circumstances referred to’ in Article 6.8 simply because not every aspect of the calculation involved the use of ‘facts available’.

 

Our reading of Article 9.4 is consistent with the purpose of the provision. Article 6.8 authorizes investigating authorities to make determinations by remedying gaps in the record which are created, in essence, as a result of deficiencies in, or a lack of, information supplied by the investigated exporters…. Article 9.4 seeks to prevent the exporters who were not asked to cooperate in the investigation, from being prejudiced by gaps or shortcomings in the information supplied by the investigated exporters. This objective would be compromised if the ceiling for the rate applied to ‘all others’ were, as the United States suggests, calculated — due to the failure of investigated parties to supply certain information — using margins ‘established’ even in part on the basis of the facts available.”⁽⁹⁷⁷⁾

709.   In response to the US objection that this interpretation of Article 9.4 would make it impossible to calculate an “all others” rate in any investigation where all of the individual margins have been calculated using some element of facts available, the Appellate Body noted that there could be investigations where all of the margins are entirely based on facts available. It characterized this situation as “a lacuna in Article 9.4”, because Article 9.4 does not address how the ceiling for the “all others” rate should be calculated if all margins of investigated respondents must be excluded from the calculation.⁽⁹⁷⁸⁾

710.   The Appellate Body in US — Zeroing (Article 21.5 — EC) commented on the disciplines that apply in such a lacuna situation, although it made no findings concerning the EC claim under Article 9.4:

“[T]he fact that all margins of dumping for the investigated exporters fall within one of the categories that Article 9.4 directs investigating authorities to disregard, for purposes of that paragraph, does not imply that the investigating authorities’ discretion to apply duties on non-investigated exporters is unbounded. The lacuna that the Appellate Body recognized to exist in Article 9.4 is one of a specific method. Thus, the absence of guidance in Article 9.4 on what particular methodology to follow does not imply an absence of any obligation with respect to the ‘all others’ rate applicable to non-investigated exporters where all margins of dumping for the investigated exporters are either zero, de minimis, or based on facts available.”⁽⁹⁷⁹⁾

(iii) Requirement to use WTO-consistent margins to establish the maximum “all others” rate

711.   The Panel in US — Shrimp (Viet Nam) examined claims regarding the “all others” rate in a lacuna situation: two administrative reviews in which all respondents selected for individual examination received a zero or de minimis margin of dumping. Reasoning that “any margin of dumping calculated or relied upon by an investigating authority in the context of the application of the Agreement must be calculated consistently with Article 2 and its various paragraphs”, the Panel found that “any individual margin of dumping which the investigating authority relies upon in determining the maximum allowable ‘all others’ rate must of necessity have been calculated in conformity with the provisions of Article 2. This is true irrespective of whether or not all individual margins are zero, de minimis or based on facts available.”⁽⁹⁸⁰⁾

712.   Concerning the lacuna situation identified above, the Panel in US — Shrimp (Viet Nam) reasoned that “if an investigating authority limits its investigation and applies an ‘all others’ rate to non-selected exporters, its discretion in doing so is not unlimited. In our view, one limitation under Article 9.4 is that the margins of dumping which are used to establish the maximum allowable ‘all others’ rate must be ones which, at the time the ‘all others’ rate is applied, conform to the disciplines of the Agreement.”⁽⁹⁸¹⁾ The Panel went on to find that “an investigating authority that determines the maximum allowable ‘all others’ rate on the basis of dumping margins calculated with the use of zeroing acts inconsistently with Article 9.4.”⁽⁹⁸²⁾

713.   In US — Shrimp (Viet Nam), the Panel found that in the underlying anti-dumping proceeding on shrimp, the US Department of Commerce treated Viet Nam as a non-market economy, and therefore applied a rebuttable presumption that all shrimp exporters were State-controlled such that they could be treated as units of a single, State-controlled, Viet Nam-wide entity. Exporting companies that could establish their independence from government control were eligible for a separate rate, and were either selected for individual examination or assigned the “all others” rate. The other (“non-separate rate”) companies were assigned the rate for the Viet Nam-wide entity, which was based on facts available.⁽⁹⁸³⁾

714.   The Panel began by addressing Viet Nam’s Article 9.4 claim, finding that by denying the “all others” rate to companies that had not positively proved their eligibility for separate rates, the United States had violated Article 9.4:

“On its face, the text of Article 9.4 seems clear in requiring that, in the context of limited examinations envisaged by the second sentence of Article 6.10, any rate assigned to non-selected respondents should not exceed the maximum allowable amount provided for in that provision. This suggests that any exporter not selected for individual examination should be assigned an ‘all others’ rate that does not exceed that maximum allowable amount. There is nothing in the text of Article 9.4 suggesting that authorities are entitled to render application of an ‘all others’ rate conditional on the fulfilment of some additional requirement.”⁽⁹⁸⁴⁾

715.   In response to a US argument that paragraph 254 of Vietnam’s Accession Working Party Report recognized Vietnam’s non-market economy nature, the Panel noted that the Working Party Report referred to “special difficulties in price and cost comparability” affecting calculation of normal value, but did not modify any other provisions in the Agreement, such as Article 9.4. The Panel found:

“[T]here is nothing in the Working Party Report indicating that an investigating authority is entitled to render application of an ‘all others’ rate subject to some additional requirement not provided for in Article 9.4. Furthermore, whereas sub-paragraphs (i) and (ii) of paragraph 255 allow an investigating authority to modify its investigation depending on whether ‘producers under investigation’ can or cannot ‘clearly show that market economy conditions prevail’ in the relevant industry, the investigating authority may only do so in respect of price comparability. Sub-paragraphs (i) and (ii) of paragraph 255 do not allow an investigating authority to assign ‘all others’ rates to non selected respondents on the basis of whether or not market conditions prevail.”⁽⁹⁸⁵⁾

716.   The Panel then found that “in those factual circumstances in which a maximum allowable ‘all others’ rate may be determined pursuant to Article 9.4(i), there is no question that an ‘all others’ rate should have been applied to both selected and non-selected respondents”. Thus, the US DOC’s decision not to apply an “all others” rate to the Viet Nam-wide entity was inconsistent with Article 9.4.⁽⁹⁸⁶⁾

6. Relationship with other Articles

717.   In Guatemala — Cement II, the Panel found that the subject anti-dumping duty order of Guatemala was inconsistent with Articles 3, 5, 6, 7, 12, and paragraph 2 of Annex I of the Anti-Dumping Agreement. The Panel then opined that Mexico’s claims under other articles of the Anti-Dumping Agreement, among them Article 9, were “dependent claims, in the sense that they depend entirely on findings that Guatemala has violated other provisions of the Anti-Dumping Agreement. There would be no basis to Mexico’s claims under Articles 1, 9 and 18 of the AD Agreement, and Article VI of GATT 1994, if Guatemala were not found to have violated other provisions of the AD Agreement.”⁽⁹⁸⁷⁾ In light of this dependent nature of Mexico’s claim, the Panel considered it not necessary to address these claims.

(a) Article 9.3 with Article 5.8

718.   The Panel in US — DRAMS discussed the relationship between Articles 5.8 and 9.3. See paragraphs 401–402 above.

(b) Article 9.3 with Article 6.8

719.   With respect to the relationship between Article 6.8 and Article 9.3, the Panel in US — Steel Plate, having found a violation of Article 6.8, considered it unnecessary to determine, in addition, whether the circumstances of that violation also constituted a violation of Article 9.3 (and Article 2.4 and Articles VI:1 and 2 of GATT 1994). In the Panel’s view, findings on these claims would serve no useful purpose, as they would neither assist the Member found to be in violation of its obligations to implement the ruling of the Panel, nor would they add to the overall understanding of the obligations found to have been violated.⁽⁹⁸⁸⁾

(c) Article 9.4 with Article 6.8

720.   In US — Hot-Rolled Steel, both the Panel and the Appellate Body analysed the relationship between Article 9.4 and Article 6.8 as regards the prohibition to calculate the “all others” rate in sample cases on the basis of margins calculated on facts available pursuant to Article 6.8. See paragraphs (i)-708 above.

(d) Article 9.4(ii)

721.   In EC — Salmon (Norway), Norway argued that the exclusion of margins of dumping established on the basis of facts available had to be disregarded in setting the appropriate level of the applicable MIP (minimum import price) because normal values were an integral part of the calculation of margins. Norway asserted that the MIPs imposed on the non-investigated parties did not meet this standard. The Panel agreed:

“Whenever ‘facts available’ are used to determine an investigated party’s normal value, the margin of dumping that is determined for that party will be established on the basis of ‘facts available’, within the meaning of Article 6.8. Thus, the requirement that ‘facts available’ margins be disregarded for the purpose of setting the ‘prospective normal value’ referred to in Article 9.4(ii) means that any normal values of investigated parties calculated on the basis of ‘facts available’ must be excluded from the calculation of the ‘weighted average normal value of the selected exporters or producers’. To this extent, we find that Article 9.4(ii) sets the maximum level of the ‘prospective normal value’ that may be imposed on non-investigated parties at the weighted average of the normal values of the investigated parties, excluding any normal values calculated for investigated parties on the basis of ‘facts available’ within the meaning of Article 6.8.”⁽⁹⁸⁹⁾

722.   The Panel in EC — Salmon (Norway) concluded that the MIPs imposed on the non-investigated parties were inconsistent with Article 9.4(ii):

“We have found that there is no objective factual basis to support the conclusion that the MIPs imposed on non-investigated parties were lower than the weighted average of the normal values of the investigated parties, excluding normal values calculated on the basis of ‘facts available’, for the following reasons:

 

(i)   the weighted average of the ‘non-dumped’ MIPs of the investigated parties did not amount to the weighted average of the normal values of the investigated parties, because the ‘non-dumped’ MIPs used for this purpose were greater than the relevant normal values, greater than what those normal values should have otherwise been and derived through the application of a flawed methodology;

 

(ii)   the weighted average of the ‘non-dumped’ MIPs of the investigated parties did not amount to the weighted average of the normal values of the investigated parties, because it includes the ‘non-dumped’ MIPs allegedly calculated for Seafarm Invest which cannot be substantiated on the basis of the evidence that is before us; and

 

(iii)   the weighted average of the ‘non-dumped’ MIPs of the investigated parties did not amount to the weighted average of the normal values of the investigated parties, because it includes the ‘non-dumped’ MIPs calculated for Grieg Seafood on the basis of ‘facts available’”.⁽⁹⁹⁰⁾

7. Relationship with other WTO Agreements

(a) Article VI: 2 of the GATT 1994

723.   The Appellate Body in US — 1916 Act addressed the argument that the phrase “may levy on any dumped product an anti-dumping duty not greater in amount than the margin of dumping in respect of such product” in Article VI:2 of the GATT 1994 implies that a Member is permitted to impose a measure other than an antidumping measure:

“We believe that the meaning of the word ‘may’ in Article VI:2 is clarified by Article 9 of the Anti-Dumping Agreement …. Article VI of the GATT 1994 and the Anti-Dumping Agreement are part of the same treaty, the WTO Agreement. As its full title indicates, the Anti-Dumping Agreement is an ‘Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994’. Accordingly, Article VI must be read in conjunction with the provisions of the Anti-Dumping Agreement, including Article 9.”⁽⁹⁹¹⁾

8. Article 9.5

724.   In Mexico — Anti-Dumping Measures on Rice, the Panel and the Appellate Body examined Article 89D of Mexico’s Foreign Trade Act under Article 9.5 and with Article 19.3 of the SCM Agreement. The Panel found that Article 89D permitted the investigating authority to conduct an expedited review provided that, inter alia, the respondent made a showing that its volume of exports during the review period was representative. The Appellate Body summarized the core provisions of Article 9.5 as follows: “Article 9.5 requires that an investigating authority carry out an expedited review of a new shipper for an exporter that (i) did not export the subject merchandise to the importing Member during the period of investigation, and (ii) demonstrated that it was not related to a foreign producer or exporter already subject to anti-dumping duties.”⁽⁹⁹²⁾ The Appellate Body upheld the Panel’s findings that this measure was inconsistent as such with Article 9.5 of the Agreement, because by requiring a showing of a representative volume of exports, it imposes a condition not provided for in Article 9.5 and prevents the authority from granting a review in instances where the conditions set out in Article 9.5 have been met.⁽⁹⁹³⁾

 

back to top

XI. Article 10  

A. Text of Article 10

Article 10: Retroactivity

10.1   Provisional measures and anti-dumping duties shall only be applied to products which enter for consumption after the time when the decision taken under paragraph 1 of Article 7 and paragraph 1 of Article 9, respectively, enters into force, subject to the exceptions set out in this Article.

 

10.2   Where a final determination of injury (but not of a threat thereof or of a material retardation of the establishment of an industry) is made or, in the case of a final determination of a threat of injury, where the effect of the dumped imports would, in the absence of the provisional measures, have led to a determination of injury, anti-dumping duties may be levied retroactively for the period for which provisional measures, if any, have been applied.

 

10.3   If the definitive anti-dumping duty is higher than the provisional duty paid or payable, or the amount estimated for the purpose of the security, the difference shall not be collected. If the definitive duty is lower than the provisional duty paid or payable, or the amount estimated for the purpose of the security, the difference shall be reimbursed or the duty recalculated, as the case may be.

 

10.4   Except as provided in paragraph 2, where a determination of threat of injury or material retardation is made (but no injury has yet occurred) a definitive anti-dumping duty may be imposed only from the date of the determination of threat of injury or material retardation, and any cash deposit made during the period of the application of provisional measures shall be refunded and any bonds released in an expeditious manner.

 

10.5   Where a final determination is negative, any cash deposit made during the period of the application of provisional measures shall be refunded and any bonds released in an expeditious manner.

 

10.6   A definitive anti-dumping duty may be levied on products which were entered for consumption not more than 90 days prior to the date of application of provisional measures, when the authorities determine for the dumped product in question that:

 

(i)   there is a history of dumping which caused injury or that the importer was, or should have been, aware that the exporter practises dumping and that such dumping would cause injury, and

 

(ii)  the injury is caused by massive dumped imports of a product in a relatively short time which in light of the timing and the volume of the dumped imports and other circumstances (such as a rapid build-up of inventories of the imported product) is likely to seriously undermine the remedial effect of the definitive anti-dumping duty to be applied, provided that the importers concerned have been given an opportunity to comment.

 

10.7   The authorities may, after initiating an investigation, take such measures as the withholding of appraisement or assessment as may be necessary to collect antidumping duties retroactively, as provided for in paragraph 6, once they have sufficient evidence that the conditions set forth in that paragraph are satisfied.

 

10.8   No duties shall be levied retroactively pursuant to paragraph 6 on products entered for consumption prior to the date of initiation of the investigation.

B. Interpretation and Application of Article 10

1. Article 10.1

725.   In US — Hot-Rolled Steel, Japan challenged the consistency with Articles 10.6 and 10.7 of the United States statutory provisions on preliminary critical circumstances determination⁽⁹⁹⁴⁾ and their application by the authorities in this case. Japan claimed that by violating these two provisions, the United States’ authorities also acted inconsistently with Article 10.1. The Panel concluded that neither the statutory provision nor its application in that case were inconsistent with Article 10.6 and Article 10.7. The Panel further found that the statutory provision was not, on its face, inconsistent with, inter alia, Article 10.1⁽⁹⁹⁵⁾ and that the authorities’ preliminary critical circumstances determination “was not inconsistent with Article 10.1 of the AD Agreement either since it complied with the conditions of Article 10.7 of the AD Agreement”.⁽⁹⁹⁶⁾

2. Article 10. 6

726.   In US — Hot-Rolled Steel, the Panel analysed the conditions imposed by Article 10.6 in the context of the retroactive imposition of anti-dumping duties permitted by Article 10.7. This provision requires, inter alia, that national authorities provide sufficient evidence that all the conditions of Article 10.6 are satisfied. See paragraphs 727–733 below.

3. Article 10.7

(a) “such measures”

727.   In US — Hot-Rolled Steel, the Panel interpreted Article 10.7 “as allowing the authority to take certain necessary measures of a purely conservatory or precautionary kind which serve the purpose of preserving the possibility of later deciding to collect duties retroactively under Article 10.6”:

“Article 10.7 provides that once the authorities have sufficient evidence that the conditions of Article 10.6 are satisfied, they may take such measures as, for example, the withholding of appraisement or assessment, as may be necessary to collect anti-dumping duties retroactively. We read this provision as allowing the authority to take certain necessary measures of a purely conservatory or precautionary kind which serve the purpose of preserving the possibility of later deciding to collect duties retroactively under Article 10.6. Unlike provisional measures, Article 10.7 measures are not primarily intended to prevent injury being caused during the investigation. They are taken in order to make subsequent retroactive duty collection possible as a practical matter. Measures taken under Article 10.7 are not based on evaluation of the same criteria as final measures that may be imposed at the end of the investigation. They are of a different kind — they preserve the possibility of imposing anti-dumping duties retroactively, on the basis of a determination additional to the ultimate final determination.

 

Our understanding in this regard is confirmed by the fact that, unlike provisional measures, which can only be imposed after a preliminary affirmative determination of dumping and injury, Article 10.7 measures may be taken at any time ‘after initiating an investigation’ ….”⁽⁹⁹⁷⁾

(b) “sufficient evidence” that the conditions of Article 10.6 are satisfied

(i) Concept of “sufficient evidence”

728.   In US — Hot-Rolled Steel, the Panel interpreted the term “sufficient evidence” in Article 10.7. The Panel explained that Article 10.7 does not define “sufficient evidence”. The Panel then referred to Article 5.3, which also reflects this standard by requiring “sufficient evidence to initiate an investigation”. In this regard, the Panel considered the approach of past GATT and WTO Panels to this standard and concluded that “what constitutes ‘sufficient evidence’ must be addressed in light of the timing and effect of the measure imposed or the determination made.” Furthermore, in the Panel’s view, “the possible effect of the measures an authority is entitled to take under Article 10.7 of the AD Agreement informs what constitutes sufficient evidence” and it therefore “is not a standard that can be determined in the abstract”:

“Article 10.7 of the AD Agreement does not define ‘sufficient evidence’. However, Article 5.3 also reflects this standard, in requiring that the authorities examine the accuracy and adequacy of the evidence provided in the application ‘to determine whether there is sufficient evidence to justify the initiation of an investigation’. The Article 5.3 requirement of ‘sufficient evidence to initiate an investigation’ has been addressed by previous GATT and WTO panels. Their approach to understanding this standard has been to examine whether the evidence before the authority at the time it made its determination was such that an unbiased and objective investigating authority evaluating that evidence could properly have made the determination.⁽⁹⁹⁸⁾ These Panels have noted that what will be sufficient evidence varies depending on the determination in question. The Panel on Mexico — HFCS quoted with approval from the Panel’s report in the Guatemala — Cement I case that ‘the type of evidence needed to justify initiation is the same as that needed to make a preliminary or final determination of threat of injury, although the quality and quantity is less’.⁽⁹⁹⁹⁾

 

… We are of the view that what constitutes ‘sufficient evidence’ must be addressed in light of the timing and effect of the measure imposed or the determination made. Evidence that is sufficient to warrant initiation of an investigation may not be sufficient to conclude that provisional measures may be imposed. In a similar vein, the possible effect of the measures an authority is entitled to take under Article 10.7 of the AD Agreement informs what constitutes sufficient evidence. Whether evidence is sufficient or not is determined by what the evidence is used for. In sum, whether evidence is sufficient to justify initiation or to justify taking certain necessary precautionary measures under Article 10.7 is not a standard that can be determined in the abstract …”⁽¹⁰⁰⁰⁾

(ii) Extent of the authorities’ determination

729.   In US — Hot-Rolled Steel, the Panel considered that the requirement of “sufficient evidence that the conditions of Article 10.6 are satisfied” did not require the authorities to make a preliminary affirmative determination of dumping and consequent injury to the domestic industry:

“In light of the timing and effect of the measures that are taken on the basis of Article 10.7, we consider that the Article 10.7 requirement of ‘sufficient evidence that the conditions of Article 10.6 are satisfied’ does not require an authority to first make a preliminary affirmative determination within the meaning of Article 7 of the AD Agreement of dumping and consequent injury to a domestic industry. If it were necessary to wait until after such a preliminary determination, there would, in our view, be no purpose served by the Article 10.7 determination. The opportunity to preserve the possibility of applying duties to a period prior to the preliminary determination would be lost, and the provisional measure that could be applied on the basis of the preliminary affirmative determination under Article 7 would prevent further injury during the course of the investigation. Moreover, the requirement in Article 7 that provisional measures may not be applied until 60 days after initiation cannot be reconciled with the right, under Article 10.6, to apply duties retroactively to 90 days prior to the date on which a provisional measure is imposed, if a preliminary affirmative determination is a prerequisite to the Article 10.7 measures which preserve the possibility of retroactive application of duties under Article 10.6.”⁽¹⁰⁰¹⁾

(iii) Conditions of Article 10.6

730.   The Panel, in US — Hot-Rolled Steel, noted that Japan had not challenged the initiation of the investigation which, pursuant to Article 5.3, was based on a determination that there was sufficient evidence of dumping, injury and causal link. The Panel indicated that, “given the precautionary nature of the measures that may be taken under Article 10.7”, it “can perceive of no reason … why that same information might not justify a determination of sufficient evidence of dumping and consequent injury in the context of Article 10.6 as required by Article 10.7.”⁽¹⁰⁰²⁾

Importers’ knowledge of exporters’ dumping

731.   The Panel, in US — Hot-Rolled Steel, commenced its analysis of whether the United States authorities had sufficient evidence that all conditions of Article 10.6 were satisfied by looking at the first condition: whether the importers knew or should have known that exporters were dumping and that such dumping would cause injury. The Panel considered that the evidence of dumping in the petition was “sufficient for an unbiased and objective investigating authority to reach this conclusion”. The Panel also noted that Japan, the complainant, had “not alleged that an imputed knowledge of dumping is, per se, inconsistent with Article 10.7, but rather argues that [the United States’ authorities] did not have sufficient evidence of dumping at all, for the purposes of Article 10.7.”⁽¹⁰⁰³⁾

“injury caused”

732.   In US — Hot-Rolled Steel, the United States authorities had adopted certain measures to collect anti-dumping duties retroactively. These authorities had made a preliminary determination of, inter alia, threat of serious injury. The Panel considered whether threat of serious injury fell within the concept of injury for the purpose of satisfying the conditions of Article 10.6 as required by Article 10.7. The Panel concluded that sufficient evidence of threat of injury is enough to justify a determination to apply protective measures under Article 10.7:

“[W]e note that Article 10.6 itself refers to a determination that an importer knew or should have known that there was dumping that would cause injury. The term ‘injury’ is defined in footnote 9 to Article 3 of the Agreement to include threat of material injury or material retardation of the establishment of an industry, unless otherwise specified. Article 10.6 does not ‘otherwise specify’. Consequently, in our view, sufficient evidence of threat of injury would be enough to justify a determination to apply protective measures under Article 10.7.

 

The role of Article 10.7 in the overall context of the AD Agreement confirms this interpretation. This provision is clearly aimed at preserving the possibility to impose and collect anti-dumping duties retroactively to 90 days prior to the date of application of provisional measures. Thus, Article 10.7 preserves the option provided in Article 10.6 to impose definitive duties even beyond the date of provisional measures. Assume arguendo Article 10.7 were understood to require sufficient evidence of actual material injury. In a situation in which, at the time Article 10.7 measures are being considered, there is evidence only of threat of material injury, no measures under Article 10.7 could be taken. Assume further that in this same investigation, there was a final determination of actual material injury caused by dumped imports. At that point, it would be impossible to apply definitive anti-dumping duties retroactively, even assuming the conditions set out in Article 10.6 were satisfied, as the necessary underlying Article 10.7 measures had not been taken.⁽¹⁰⁰⁴⁾ Thus, in a sense, Article 10.7 measures serve the same purpose as an order at the beginning of a lawsuit to preserve the status quo — they ensure that at the end of the process, effective measures can be put in place should the circumstances warrant.”⁽¹⁰⁰⁵⁾

“massive imports in a relatively short period of time”

733.   The Panel in US — Hot-Rolled Steel analysed the third condition of Article 10.6 of which sufficient evidence is required by Article 10.7, namely that the injury be caused by massive dumped imports in a relatively short period of time. The Panel noted that the Anti-Dumping Agreement does not indicate what period should be used in order to assess whether there were massive imports over a short period of time. Nevertheless, the Panel concluded that “massive imports that were not made in tempore non suspectu but at a moment in time where it had become public knowledge that an investigation was imminent may be taken into consideration in assessing whether Article 10.7 measures may be imposed”:

“The Agreement does not determine what period should be used in order to assess whether there were massive imports over a short period of time. Japan asserts that the latter part of Article 10.6(ii) of the AD Agreement, referring to whether the injury caused by massive imports is likely to seriously undermine the remedial effect of the duty, implies that the period for comparison is the months before and after the initiation of the investigation. Japan argues that since the duty cannot be imposed retroactively to the period before the initiation, the remedial effect of the duty cannot be undermined by massive imports before initiation.

 

We disagree with this conclusion. Article 10.7 allows for certain necessary measures to be taken at any time after initiation of the investigation. In order to be able to make any determination concerning whether there are massive dumped imports, a comparison of data is obviously necessary. However, if a Member were required to wait until information concerning the volume of imports for some period after initiation were available, this right to act at any time after initiation would be vitiated. By the time the necessary information on import volumes for even a brief period after initiation were available, as a practical matter, the possibility to impose final duties retroactively to initiation would be lost, as there would be no Article 10.7 measures in place. Moreover, as with the situation if a Member were required to wait the minimum 60 days and make a preliminary determination under Article 7 before applying measures under Article 10.7, the possibility of retroactively collecting duties under Article 10.6 at the final stage would have been lost.

 

Moreover, in our view, it is not unreasonable to conclude that the remedial effect of the definitive duty could be undermined by massive imports that entered the country before the initiation of the investigation but at a time at which it had become clear that an investigation was imminent. We consider that massive imports that were not made in tempore non suspectu but at a moment in time where it had become public knowledge that an investigation was imminent may be taken into consideration in assessing whether Article 10.7 measures may be imposed. Again, we emphasize that we are not addressing the question whether this would be adequate for purposes of the final determination to apply duties retroactively under Article 10.6.”⁽¹⁰⁰⁶⁾

4. Relationship with other Articles

734.   In US — Hot-Rolled Steel, the Panel interpreted the term “sufficient evidence” in Article 10.7 by reference to Article 5.3. See paragraph 728 above.

 

back to top

XII. Article 11 

A. Text of Article 11

Article 11: Duration and Review of Anti-Dumping Duties and Price Undertakings

11.1   An anti-dumping duty shall remain in force only as long as and to the extent necessary to counteract dumping which is causing injury.

 

11.2   The authorities shall review the need for the continued imposition of the duty, where warranted, on their own initiative or, provided that a reasonable period of time has elapsed since the imposition of the definitive anti-dumping duty, upon request by any interested party which submits positive information substantiating the need for a review.(21) Interested parties shall have the right to request the authorities to examine whether the continued imposition of the duty is necessary to offset dumping, whether the injury would be likely to continue or recur if the duty were removed or varied, or both. If, as a result of the review under this paragraph, the authorities determine that the anti-dumping duty is no longer warranted, it shall be terminated immediately.

 

(footnote original) 21 A determination of final liability for payment of anti-dumping duties, as provided for in paragraph 3 of Article 9, does not by itself constitute a review within the meaning of this Article.

 

11.3   Notwithstanding the provisions of paragraphs 1 and 2, any definitive anti-dumping duty shall be terminated on a date not later than five years from its imposition (or from the date of the most recent review under paragraph 2 if that review has covered both dumping and injury, or under this paragraph), unless the authorities determine, in a review initiated before that date on their own initiative or upon a duly substantiated request made by or on behalf of the domestic industry within a reasonable period of time prior to that date, that the expiry of the duty would be likely to lead to continuation or recurrence of dumping and injury.(22) The duty may remain in force pending the outcome of such a review.

 

(footnote original) 22 When the amount of the anti-dumping duty is assessed on a retrospective basis, a finding in the most recent assessment proceeding under subparagraph 3.1 of Article 9 that no duty is to be levied shall not by itself require the authorities to terminate the definitive duty.

 

11.4   The provisions of Article 6 regarding evidence and procedure shall apply to any review carried out under this Article. Any such review shall be carried out expeditiously and shall normally be concluded within 12 months of the date of initiation of the review.

 

11.5   The provisions of this Article shall apply mutatis mutandis to price undertakings accepted under Article 8.

B. Interpretation and Application of Article 11

1. Article 11.1

(a) Necessity

735.   The Panel in US — DRAMS described the requirement in Article 11.1 whereby anti-dumping duties “shall remain in force only as long as and to the extent necessary” to counteract injurious dumping, as “a general necessity requirement.”⁽¹⁰⁰⁷⁾

736.   In assessing the essential character of the necessity involved in Article 11.1, the Panel in US — DRAMS stated the following:

“We note that the necessity of the measure is a function of certain objective conditions being in place, i.e. whether circumstances require continued imposition of the antidumping duty. That being so, such continued imposition must, in our view, be essentially dependent on, and therefore assignable to, a foundation of positive evidence that circumstances demand it. In other words, the need for the continued imposition of the duty must be demonstrable on the basis of the evidence adduced.”⁽¹⁰⁰⁸⁾

737.   The Panel in US — DRAMS held that “the necessity of the continued imposition of the anti-dumping duty can only arise in a defined situation pursuant to Article 11.2: viz to offset dumping”.⁽¹⁰⁰⁹⁾ See paragraph 745 below.

738.   With respect to the relationship between Article 11.1 and 11.2, see paragraph 739 below.

(b) Relationship with other paragraphs of Article 11

739.   The Panel in US — DRAMS examined the relationship between Articles 11.1 and 11.2 by considering whether the terms of Article 11.2 preclude the continued imposition of anti-dumping duties on the basis that an authority fails to satisfy itself that recurrence of dumping is “not likely”. Referring to the general necessity requirement in Article 11.1, the Panel further noted that “the application of the general rule in Article 11.1 is specified in Article 11.2”.⁽¹⁰¹⁰⁾

740.   The Panel in EC — Tube or Pipe Fittings considered that “Article 11.1 does not set out an independent or additional obligation for Members”⁽¹⁰¹¹⁾ but rather “furnishes the basis for the review procedures contained in Article 11.2 (and 11.3) by stating a general and overarching principle, the modalities of which are set forth in paragraph 2 (and 3) of that Article”.⁽¹⁰¹²⁾

2. Article 11.2

(a) “whether the continued imposition of the duty is necessary to offset dumping”

741.   Considering whether Article 11.2 precludes an anti-dumping duty being deemed “necessary to offset dumping” where there is no present dumping to offset, the Panel in US — DRAMS addressed the issue as follows:

“First, we note that the second sentence of Article 11.2 refers to an examination of ‘whether the continued imposition of the duty is necessary to offset dumping.’ We note further that this sentence is expressed in the present tense. In addition, the second sentence of Article 11.2 does not explicitly include any reference to dumping being ‘likely’ to ‘recur’, as is the case with the injury review envisaged by that sentence.

 

However, the second sentence of Article 11.2 requires an investigating authority to examine whether the ‘continued imposition’ of the duty is necessary to offset dumping. The word ‘continued’ covers a temporal relationship between past and future. In our view, the word ‘continued’ would be redundant if the investigating authority were restricted to considering only whether the duty was necessary to offset present dumping. Thus, the inclusion of the word ‘continued’ signifies that the investigating authority is entitled to examine whether imposition of the duty may be applied henceforth to offset dumping.

 

Furthermore, with regard to injury, Article 11.2 provides for a review of ‘whether the injury would be likely to continue or recur if the duty were removed or varied’ (emphasis supplied). In conducting an Article 11.2 injury review, an investigating authority may examine the causal link between injury and dumped imports. If, in the context of a review of such a causal link, the only injury under examination is injury that may recur following revocation (i.e., future rather than present injury), an investigating authority must necessarily be examining whether that future injury would be caused by dumping with a commensurately prospective timeframe. To do so, the investigating authority would first need to have established a status regarding the prospects of dumping. For these reasons, we do not agree that Article 11.2 precludes a priori the justification of continued imposition of antidumping duties when there is no present dumping.

 

In addition, we note that there is nothing in the text of Article 11.2 of the AD Agreement that explicitly limits a Member to a ‘present’ analysis, and forecloses a prospective analysis, when conducting an Article 11.2 review.”⁽¹⁰¹³⁾

742.   The Panel in US — DRAMS considered Article 11.3 to be particularly relevant in giving support for, and reinforcing, its interpretation of Article 11.2 regarding the issue of whether Article 11.2 precludes an anti-dumping duty being deemed “necessary to offset dumping” where there is no present dumping to offset.⁽¹⁰¹⁴⁾ The Panel stated the following regarding Article 11.3:

“We note that with regard to dumping, the ‘sunset provision’ in Article 11.3 of the AD Agreement envisages inter alia an examination of whether the expiry of an anti-dumping duty would be likely to lead to ‘continuation or recurrence’ of dumping. If, as argued …, an anti-dumping duty must be revoked as soon as present dumping is found to have ceased, the possibility (explicitly envisaged by Article 11.3) of the expiry of that duty causing dumping to recur could never arise. This is because the reference to ‘expiry’ in Article 11.3 assumes that the duty is still in force, and the reference to ‘recurrence’ of dumping assumes that dumping has ceased, but may ‘recur’ as a result of revocation. [This] textual interpretation of Article 11.2 would effectively exclude the possibility of an Article 11.3 review in circumstances where dumping has ceased but the duty remains in force. [This] interpretation therefore renders part of Article 11.3 ineffective. As stated by the Appellate Body in Gasoline, ‘[a]n interpreter is not free to adopt a reading that would result in reducing whole clauses or paragraphs of a treaty to redundancy or inutility’. An interpretation of Article 11.2 which renders part of Article 11.3 meaningless is contrary to the customary or general rules of treaty interpretation, and thus should be rejected.”⁽¹⁰¹⁵⁾

743.   The Panel in US — DRAMS also rejected the argument that Article 11.2 requires the immediate revocation of an anti-dumping duty in case of a finding of “no dumping”. The Panel opined that such interpretation would render footnote 22 under Article 11.3 meaningless:

“Furthermore, [the] argument that Article 11.2 requires the immediate revocation of an anti-dumping duty in case of a finding of ‘no dumping’ (e.g., when a retrospective assessment finds that no duty is to be levied) is also inconsistent with note 22 of the AD Agreement. Note 22 states that, in cases where anti-dumping duties are levied on a retrospective basis, ‘a finding in the most recent assessment proceeding … that no duty is to be levied shall not by itself require the authorities to terminate the definitive duty’. If [this] interpretation of Article 11.2 were accurate, then an investigating authority would be obligated under Article 11.2 to terminate an anti-dumping duty upon making such a finding, and note 22 would be meaningless. In our view, this confirms a finding that the absence of present dumping does not in and of itself require the immediate termination of an antidumping duty pursuant to Article 11.2.”⁽¹⁰¹⁶⁾

744.   As a result of its findings quoted in paragraphs 741–743 above, the Panel in US — DRAMS rejected the argument that “Article 11.2 of the AD Agreement requires revocation as soon as an exporter is found to have ceased dumping, and that the continuation of an anti-dumping duty is precluded a priori in any circumstances other than where there is present dumping.”⁽¹⁰¹⁷⁾

745.   Referring to the general necessity requirement in Article 11, the Panel in US — DRAMS held that such necessity can only arise “in a defined situation pursuant to Article 11.2”. While “the necessity involved in Article 11.2 is not to be construed in some absolute and abstract sense”, it should nevertheless “be demonstrable on the basis of the evidence adduced”:

“The necessity of the continued imposition of the antidumping duty can only arise in a defined situation pursuant to Article 11.2: viz to offset dumping. Absent the prescribed situation, there is no basis for continued imposition of the duty: the duty cannot be ‘necessary’ in the sense of being demonstrable on the basis of the evidence adduced because it has been deprived of its essential foundation. In this context, we recall our finding that Article 11.2 does not preclude a priori continued imposition of anti-dumping duties in the absence of present dumping. However, it is also clear from the plain meaning of the text of Article 11.2 that the continued imposition must still satisfy the ‘necessity’ standard, even where the need for the continued imposition of an anti-dumping duty is tied to the ‘recurrence’ of dumping. We recognize that the certainty inherent to such a prospective analysis could be conceivably somewhat less than that attached to purely retrospective analysis, reflecting the simple fact that analysis involving prediction can scarcely aspire to a standard of inevitability. This is, in our view, a discernible distinction in the degree of certainty, but not one which would be sufficient to preclude that the standard of necessity could be met. In our view, this reflects the fact that the necessity involved in Article 11.2 is not to be construed in some absolute and abstract sense, but as that appropriate to circumstances of practical reasoning intrinsic to a review process. Mathematical certainty is not required, but the conclusions should be demonstrable on the basis of the evidence adduced. This is as much applicable to a case relating to the prospect of recurrence of dumping as to one of present dumping.”⁽¹⁰¹⁸⁾

746.   With respect to other findings of the Panel in US — DRAMS concerning “necessity” under Article 11, see paragraphs 735–736 above.

(b) “injury”

747.   In US — DRAMS, the Panel stated that “by virtue of note 9 of the AD Agreement, the term ‘injury’ in Article 11.2 ‘shall be interpreted in accordance with the provisions of’ Article 3.”⁽¹⁰¹⁹⁾ See further the excerpt quoted in paragraph 751 below.

(c) “likely to lead to continuation or recurrence”

748.   The Panel in US — DRAMS considered Korea’s claim that the test applied by the United States’ authorities was inconsistent with the “likely to lead to continuation or recurrence” language of Article 11.2. The Panel noted that under United States’ law, the competent authority will not revoke anti-dumping duties unless it is “satisfied that future dumping is not likely.”⁽¹⁰²⁰⁾ (emphasis added) Korea argued that this “not likely” test was inconsistent with Article 11.2, because Article 11.2 mentions a likelihood test only with respect to injury. Furthermore, Korea argued that, even if the “likely” standard, established under Article 11.2 only in the context of injury, applied also in the context of dumping, the United States’ “not likely” test was in any case incompatible with the “likely” standard set forth in Article 11.2. The Panel found that the “‘not likely’ standard is not in fact equivalent to, and falls decisively short of, establishing that dumping is ‘likely to recur if the order is revoked’.”⁽¹⁰²¹⁾ In reaching this finding, the Panel considered both the “clear conceptual difference between establishing something as a positive finding and failing to establish something as a negative finding”⁽¹⁰²²⁾, and the common usage of the relevant terms.⁽¹⁰²³⁾ The Panel noted that situations could exist where the “not likely” standard would be satisfied, while the “likely” standard would not be and concluded by stating that the United States’ “not likely” test did not provide a “demonstrable basis for consistently and reliably determining that the likelihood criterion is satisfied”.⁽¹⁰²⁴⁾

749.   After finding that the United States’ test of “not likely” was inconsistent with the “likely” test mandated by the Anti-Dumping Agreement, the Panel in US — DRAMS decided not to address the issue whether the “likely” standard in the dumping context (as opposed to the injury context, where it is explicitly established) is consistent with the terms of Article 11.2 of the Agreement. The Panel then made the following observations, stating that a “likelihood” standard, applied in the context of injury under Article 11.2, could be applicable also in the anti-dumping context. More specifically, the Panel held, inter alia, that “there could be reason to support a view that authorities are entitled to apply the same test concerning the likelihood of recurrence or continuation of dumping for both Article 11.2 and 11.3 reviews”:

“We note that Article 11.3 provides for termination of a definitive anti-dumping duty five years from its imposition. However, such termination is conditional. First, the terms of Article 11.3 itself lay down that this should occur unless the authorities determine that the expiry would be ‘likely to lead to continuation or recurrence of dumping and injury.’ Where there is a determination that both are likely, the duty may remain in force, and the five year clock is reset to start again from that point. Second, Article 11.3 provides also for another situation whereby this five year period can be otherwise effectively extended, viz. in a situation where a review under paragraph 2 covering both dumping and injury has taken place. If, for instance, such a review took place at the four year point, it could effectively extend the sunset review until 9 years from the original determination. In the first case, we note that the provisions of Article 11.3 explicitly condition the prolongation of the five year period on a finding that there is likelihood of dumping and injury continuing or recurring. In the second case, where there is reference to review under Article 11.2, there is no such explicit reference.

 

However, we note that both instances of review have the same practical effect of prolonging the application of anti-dumping duties beyond the five year point of an initial sunset review. This at the very least suggests, in our view, that there could be reason to support a view that authorities are entitled to apply the same test concerning the likelihood of recurrence or continuation of dumping for both Article 11.2 and 11.3 reviews. There certainly appears to be nothing that explicitly provides to the contrary. Nor do we see any reason why this conclusion would be materially affected by whether or not the dumping review occurred in conjunction with an injury review. There is nothing in the text of Article 11 which suggests there should be some fundamental bifurcation of the applicable standard for dumping review contingent on whether there is also an Article 11.2 injury review being undertaken.

 

We also note that ‘likelihood’ or ‘likely’ carries with it the ordinary meaning of ‘probable’. That being so, it seems to us that a ‘likely standard’ amounts to the view that where recurrence of dumping is found to be probable as a consequence of revocation of an anti-dumping duty, this probability would constitute a proper basis for entitlement to maintain that anti-dumping duty in force. Without prejudice to the legal status of such a view in terms of its consistency with the terms of Article 11.2 — a matter on which we are not required to rule as noted in the text above — we feel obliged to at least take note that, at least as a practical matter, rejection of such a view would effectively amount to a systematic requirement that reviewing authorities are obliged to revoke antidumping duties precisely where doing so would render recurrence of dumping probable.”⁽¹⁰²⁵⁾

(d) “warranted”

750.   The Panel considered whether “Article 11.2 necessarily requires an investigating authority, following three years and six months’ findings of no dumping, to find an ex officio Article 11.2 review of ‘whether the injury would be likely to continue or recur if the duty were removed or varied’ is ‘warranted’”⁽¹⁰²⁶⁾ it stated whether such “injury” review would be “warranted” would be entirely dependent upon a determination of whether dumping will recur:

“A review of ‘whether the injury would be likely to continue or recur if the duty were removed or varied’ could include a review of whether (1) injury that is (2) caused by dumped imports would be likely to continue or recur if the duty were removed or varied. With regard to injury, we believe that an absence of dumping during the preceding three years and six months is not in and of itself indicative of the likely state of the relevant domestic industry if the duty were removed or varied. With regard to causality, an absence of dumping during the preceding three years and six months is not in and of itself indicative of causal factors other than the absence of dumping. If the only causal factor under consideration is three years and six months’ no dumping, the issue of causality becomes whether injury caused by dumped imports will recur. This necessarily requires a determination of whether dumping will recur. Thus, the ‘injury’ review that [is believed to be] ‘warranted’ on the basis of three years and six months’ no dumping would be entirely dependent upon a determination of whether dumping will recur… . The mere fact of three years and six months’ findings of no dumping does not require the investigating authority to, in addition, self-initiate a review of ‘whether the injury would be likely to continue or recur if the duty were removed or varied’.”⁽¹⁰²⁷⁾

751.   In a footnote to the statement quoted in paragraph 752 below, the Panel in US — DRAMS noted:

“[B]y virtue of note 9 of the AD Agreement, the term ‘injury’ in Article 11.2 ‘shall be interpreted in accordance with the provisions of’ Article 3. Article 3.5 of the AD Agreement requires the establishment of a causal link between the dumped imports and the injury found to exist. Thus, we consider that the Article 11.2 examination of ‘whether the injury would be likely to continue or recur if the duty were removed or varied’ may also involve an examination of whether any injury that is found to be likely to continue or recur is caused by dumped imports. We can envisage circumstances, however, when an Article 11.2 injury review need not necessarily include an examination of causal link.”⁽¹⁰²⁸⁾

752.   The Panel in EC — Tube or Pipe Fittings understood the “phrase ‘where warranted’ in Article 11.2 to denote circumstances furnishing good and sufficient grounds for, or justifying, the self-initiation of a review. Where an investigating authority determines such circumstances to exist, an investigating authority must self-initiate a review. Such a review, once initiated, will examine whether continued imposition of the duty is necessary to offset dumping, whether the dumping would be likely to continue or recur, or both. Article 11.2 therefore provides a review mechanism to ensure that Members comply with the rule contained in Article 11.1.”⁽¹⁰²⁹⁾ As the Panel pointed out, “the determination of whether or not good and sufficient grounds exist for the self-initiation of a review necessarily depends upon the factual situation in a given case and will necessarily vary from case to case”.⁽¹⁰³⁰⁾

(e) Relationship with other paragraphs of Article 11

753.   The US — DRAMS Panel touched on the relationship between Article 11.1 and Article 11.2. See paragraph 739 above.

754.   The relationship between Article 11.2 and Article 11.3 was also discussed in US — DRAMS. See the excerpts quoted in paragraphs 742 and 749 above. The relationship between Article 11.2 and footnote 22 to Article 11.3 was addressed by the Panel in US — DRAMS. See paragraph 743 above.

3. Article 11.3

(a) General

(i) Mandating rule / exception

755.   The Appellate Body in US — Corrosion-Resistant Steel Sunset Review considered that Article 11.3 lays down a mandatory rule with an exception and thus imposes a temporal limitation on the imposition of anti-dumping duties:

“Specifically, Members are required to terminate an antidumping duty within five years of its imposition ‘unless‘ the following conditions are satisfied: first, that a review be initiated before the expiry of five years from the date of the imposition of the duty; second, that in the review the authorities determine that the expiry of the duty would be likely to lead to continuation or recurrence of dumping; and third, that in the review the authorities determine that the expiry of the duty would be likely to lead to continuation or recurrence of injury. If any one of these conditions is not satisfied, the duty must be terminated.⁽¹⁰³¹⁾”⁽¹⁰³²⁾

756.   The Appellate Body in US — Oil Country Tubular Goods Sunset Reviews also viewed the continuation of an anti-dumping duty as “an exception to the otherwise mandated expiry of the duty after five years”.⁽¹⁰³³⁾

(ii) Difference between original investigation and sunset reviews

757.   With respect to the determination of a likelihood of recurrence or continuation of dumping and injury, the Appellate Body in US — Corrosion-Resistant Steel Sunset Review noted that, as this likelihood determination is a prospective determination: “the authorities must undertake a forward-looking analysis and seek to resolve the issue of what would be likely to occur if the duty were terminated”.⁽¹⁰³⁴⁾ In this respect, the Appellate Body pointed to the important difference between original investigations and sunset reviews:

“In an original anti-dumping investigation, investigating authorities must determine whether dumping exists during the period of investigation. In contrast, in a sunset review of an anti-dumping duty, investigating authorities must determine whether the expiry of the duty that was imposed at the conclusion of an original investigation would be likely to lead to continuation or recurrence of dumping.”⁽¹⁰³⁵⁾

(iii) Active role of investigating authorities

758.   Based on an analysis of the various terms used in Article 11.3, the Appellate Body in US — Corrosion-Resistant Steel Sunset Review then reached the following general conclusions:

“This language in Article 11.3 makes clear that it envisages a process combining both investigatory and adjudicatory aspects. In other words, Article 11.3 assigns an active rather than a passive decision-making role to the authorities. The words ‘review’ and ‘determine’ in Article 11.3 suggest that authorities conducting a sunset review must act with an appropriate degree of diligence and arrive at a reasoned conclusion on the basis of information gathered as part of a process of reconsideration and examination. In view of the use of the word ‘likely’ in Article 11.3, an affirmative likelihood determination may be made only if the evidence demonstrates that dumping would be probable if the duty were terminated — and not simply if the evidence suggests that such a result might be possible or plausible.”⁽¹⁰³⁶⁾

759.   The Panel in US — Corrosion-Resistant Steel Sunset Review also underlined the importance of the need for sufficient positive evidence on which to base the likelihood determination:

“The requirement to make a ‘determination’ concerning likelihood therefore precludes an investigating authority from simply assuming that likelihood exists. In order to continue the imposition of the measure after the expiry of the five-year application period, it is clear that the investigating authority has to determine, on the basis of positive evidence, that termination of the duty is likely to lead to continuation or recurrence of dumping and injury. An investigating authority must have a sufficient factual basis to allow it to draw reasoned and adequate conclusions concerning the likelihood of such continuation or recurrence.”⁽¹⁰³⁷⁾

(iv) Positive evidence

760.   The Panel in US — Corrosion-Resistant Steel Sunset Review expressed its view on the use of historical data as a basis for the inherently prospective likelihood determination of Article 11.3:

“Future ‘facts’ do not exist. The only type of facts that exist and that may be established with certainty and precision relate to the past and, to the extent they may be accurately recorded and evaluated, to the present. We recall that one of the fundamental goals of the Anti-Dumping Agreement as a whole is to ensure that objective determinations are made, based, to the extent possible, on facts.⁽¹⁰³⁸⁾ Thus, to the extent that it will rest upon a factual foundation, the prospective likelihood determination will inevitably rest on a factual foundation relating to the past and present. The investigating authority must evaluate this factual foundation and come to a reasoned conclusion about likely future developments.”⁽¹⁰³⁹⁾

761.   The Appellate Body in US — Oil Country Tubular Goods Sunset Reviews adopted a similar approach to the need to base a prospective likelihood determination on “positive evidence”:

“The requirements of ‘positive evidence’ must, however, be seen in the context that the determinations to be made under Article 11.3 are prospective in nature and that they involve a ‘forward-looking analysis’.⁽¹⁰⁴⁰⁾ Such an analysis may inevitably entail assumptions about or projections into the future. Unavoidably, therefore, the inferences drawn from the evidence in the record will be, to a certain extent, speculative. In our view, that some of the inferences drawn from the evidence on record are projections into the future does not necessarily suggest that such inferences are not based on ‘positive evidence’.”⁽¹⁰⁴¹⁾

(b) No specific methodology

762.   The Panel in US — Corrosion-Resistant Steel Sunset Review considered that Article 11.3 does not expressly prescribe any specific methodology for investigating authorities to use in making a likelihood determination in a sunset review:

“Similarly, we observe that Article 11.3 is silent as to how an authority should or must establish that dumping is likely to continue or recur in a sunset review. That provision itself prescribes no parameters as to any methodological requirements that must be fulfilled by a Member’s investigating authority in making such a ‘likelihood’ determination.”⁽¹⁰⁴²⁾

763.   This view was confirmed by the Appellate Body in US — Corrosion-Resistant Steel Sunset Review. It thus considered that “no obligation is imposed on investigating authorities to calculate or rely on dumping margins in a sunset review.”⁽¹⁰⁴³⁾ According to the Appellate Body, “in a sunset review, dumping margins may well be relevant to, but they will not necessarily be conclusive of, whether the expiry of the duty would be likely to lead to continuation or recurrence of dumping”.⁽¹⁰⁴⁴⁾

764.   However, the Appellate Body in US — Corrosion-Resistant Steel Sunset Review added, 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 in general and Article 2.4 in particular: “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.”⁽¹⁰⁴⁵⁾ In such circumstances, “the likelihood[-of-dumping] determination could not constitute a proper foundation for the continuation of antidumping duties under Article 11.3.”⁽¹⁰⁴⁶⁾

765.   The Panel in US — Oil Country Tubular Goods Sunset Reviews came to a similar conclusion with respect to the likelihood of injury determination. According to the Panel, obligations contained in the various paragraphs of Article 3 do not “normally” apply to sunset reviews:

“Just as the Appellate Body stated that an investigating authority is not required to make a dumping determination in a sunset review, we consider that an investigating authority is not required to make an injury determination in a sunset review. It follows, then, that the obligations set out in Article 3 do not normally apply to sunset reviews”⁽¹⁰⁴⁷⁾

766.   However, the Panel was of the view that, to the extent that an investigating authority relies on a determination of injury when conducting a sunset review, the obligations of Article 3 would apply to that determination:

“If, however, an investigating authority decides to conduct an injury determination in a sunset review, or if it uses a past injury determination as part of its sunset determination, it is under the obligation to make sure that its injury determination or the past injury determination it is using conforms to the relevant provisions of Article 3.⁽¹⁰⁴⁸⁾ For instance, Article 11.3 does not mention whether an investigating authority is required to calculate the price effect of future dumped imports on the prices of the domestic industry. In our view, this means that an investigating authority is not necessarily required to carry out that calculation in a sunset review. However, if the investigating authority decides to do such a calculation, then it would be bound by the relevant provisions of Article 3 of the Agreement. Similarly, if, in its sunset injury determinations, an investigating authority uses a price effect calculation made in the original investigation or in the intervening reviews, it has to assure the consistency of that calculation with the existing provisions of Article 3.”⁽¹⁰⁴⁹⁾

767.   The Appellate Body in US — Oil Country Tubular Goods Sunset Reviews agreed with this approach by the Panel. The Appellate Body considered that “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.”⁽¹⁰⁵⁰⁾ According to the Appellate Body, “it does not follow, however, from this single definition of ‘injury’, that all of the provisions of Article 3 are applicable in their entirety to sunset review determinations under Article 11.3”⁽¹⁰⁵¹⁾:

“In our view, however, the Anti-Dumping Agreement distinguishes between ‘determination[s] of injury’, addressed in Article 3, and determinations of likelihood of ‘continuation or recurrence … of injury’, addressed in Article 11.3. In addition, Article 11.3 does not contain any cross-reference to Article 3 to the effect that, in making the likelihood-of-injury determination, all the provisions of Article 3 — or any particular provisions of Article 3 — must be followed by investigating authorities. Nor does any provision of Article 3 indicate that, wherever the term ‘injury’ appears in the Anti-Dumping Agreement, a determination of injury must be made following the provisions of Article 3.”⁽¹⁰⁵²⁾

768.   The Appellate Body in US — Oil Country Tubular Goods Sunset Reviews concluded that “investigating authorities are not mandated to follow the provisions of Article 3 when making a likelihood-of-injury determination”.⁽¹⁰⁵³⁾ However, the Appellate Body added, this does not imply that in a sunset review determination, an investigating authority is never required to examine any of the factors listed in the paragraphs of Article 3:

“Certain of the analyses mandated by Article 3 and necessarily relevant in an original investigation may prove to be probative, or possibly even required, in order for an investigating authority in a sunset review to arrive at a ‘reasoned conclusion’. In this respect, we are of the view that the fundamental requirement of Article 3.1 that an injury determination be based on ‘positive evidence’ and an ‘objective examination’ would be equally relevant to likelihood determinations under Article 11.3. It seems to us that factors such as the volume, price effects, and the impact on the domestic industry of dumped imports, taking into account the conditions of competition, may be relevant to varying degrees in a given likelihood-of-injury determination. An investigating authority may also, in its own judgement, consider other factors contained in Article 3 when making a likelihood-of-injury determination. But the necessity of conducting such an analysis in a given case results from the requirement imposed by Article 11.3 — not Article 3 — that a likelihood-of-injury determination rest on a ‘sufficient factual basis’ that allows the agency to draw ‘reasoned and adequate conclusions’.”⁽¹⁰⁵⁴⁾

769.   The Panel in US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina) articulated further the freedom of an investigating authority to choose its own methodology to determine the likelihood of continuation or recurrence of dumping, cautioning that the investigating authority would nevertheless need to act with an appropriate degree of diligence:

“Article 11.3 requires investigating authorities to terminate an anti-dumping duty not later than five years from its imposition unless they determine in a review initiated before then that dumping and injury are likely to continue or recur should the duty be revoked Article 11.3 does not, however, set out a specific methodology for making such determinations. In principle, therefore, investigating authorities are not restricted in the choice of methodology they will follow in making their sunset determinations. In their choice of methodology, however, the investigating authorities should have regard to both ‘investigatory and adjudicatory aspects’ of sunset reviews and make forward-looking determinations on the basis of evidence relating to the past. They must arrive at reasoned conclusions on the basis of positive evidence. In so doing, the investigating authorities may not remain passive. Rather, the authorities have to act with an ‘appropriate degree of diligence’.”⁽¹⁰⁵⁵⁾

770.   In US — Zeroing (Japan), the Panel determined that in making two sunset review determinations at issue, the US Department of Commerce relied on margins of dumping established in prior proceedings when making its likelihood-of-dumping calculations; The Appellate Body held that because zeroing in periodic reviews is inconsistent as such with Articles 2.4 and 9.3, the likelihood-of-dumping determinations were inconsistent with Article 11.3 because they relied on margins calculated inconsistently with the Agreement.⁽¹⁰⁵⁶⁾

771.   The Panel in US — Continued Zeroing found that to the extent that a sunset review determination is based on previous margins obtained through a methodology that is inconsistent with the covered agreements, the resulting sunset review determinations would also be inconsistent with the covered agreements; it found that eight sunset review determinations were inconsistent with Article 11.3 because they relied on margins obtained through model zeroing in prior investigations.⁽¹⁰⁵⁷⁾ The Appellate Body upheld this finding, and concluded that

“the application and continued application of antidumping duties is inconsistent with Article 11.3 of the Anti-Dumping Agreement to the extent that reliance is placed upon a margin of dumping calculated through the use of the zeroing methodology in making sunset review determinations.”⁽¹⁰⁵⁸⁾

(c) Use of presumptions in a likelihood determination

772.   The Appellate Body in US — Corrosion-Resistant Steel Sunset Review clearly stated that the use of presumptions may be inconsistent with an obligation to make a particular determination in each case using positive evidence. It considered “that a firm evidentiary foundation is required in each case for a proper determination under Article 11.3 of the likelihood of continuation or recurrence of dumping. Such a determination cannot be based solely on the mechanistic application of presumptions.”⁽¹⁰⁵⁹⁾

773.   The Appellate Body in US — Corrosion-Resistant Steel Sunset Review saw no problem in investigating authorities being instructed to examine, in every sunset review, dumping margin and import volumes.⁽¹⁰⁶⁰⁾ However, it noted that the significance and probative value of the two factors for a likelihood determination in a sunset review will necessarily vary from case to case. It stated that it “would have difficulty accepting that dumping margins and import volumes are always ‘highly probative’ in a sunset review by the United States Department of Commerce if this means that either or both of these factors are presumed, by themselves, to constitute sufficient evidence that the expiry of the duty would be likely to lead to continuation or recurrence of dumping”⁽¹⁰⁶¹⁾ The Appellate Body thus concluded that the consistency of the provisions of a measure with Article 11.3 hinges upon whether those provisions instruct the investigating authority to treat “dumping margins and/or import volumes as determinative or conclusive, on the one hand, or merely indicative or probative, on the other hand, of the likelihood of future dumping.”⁽¹⁰⁶²⁾

774.   The Panel in US — Oil Country Tubular Goods Sunset Reviews considered that a scheme that attributes a “determinative” / “conclusive” value to certain factors in sunset determinations — as opposed to only an indicative value — is likely to violate Article 11.3 of the Anti-Dumping Agreement.⁽¹⁰⁶³⁾ On appeal, the Appellate Body considered that the Panel had correctly articulated the standard for determining whether a measure was inconsistent, as such, with Article 11.3 of the Anti-Dumping Agreement.⁽¹⁰⁶⁴⁾

775.   The Panel in US — Oil Country Tubular Goods Sunset Reviews considered that both the so called deemed waiver and affirmative waiver provisions of United States law were inconsistent with Article 11.3 because they required an authority to make an affirmative determination of likelihood of continuation or recurrence of dumping, without taking into consideration the facts submitted by the exporter filing an incomplete submission, or without any further inquiry in the event where the exporter filed no submission or declared its intention not to participate in the review.⁽¹⁰⁶⁵⁾ On appeal, the Appellate Body agreed with the Panel’s analysis:

“Because the waiver provisions require the USDOC to arrive at affirmative company-specific determinations without regard to any evidence on record, these determinations are merely assumptions made by the agency, rather than findings supported by evidence. The United States contends that respondents waiving the right to participate in a sunset review do so ‘intentionally’, with full knowledge that, as a result of their failure to submit evidence, the evidence placed on the record by the domestic industry is likely to result in an unfavourable determination on an order-wide basis. In these circumstances, we see no fault in making an unfavourable order-wide determination by taking into account evidence provided by the domestic industry in support thereof. However, the USDOC also takes into account, in such circumstances, statutorily-mandated assumptions. Thus, even assuming that the USDOC takes into account the totality of record evidence in making its order-wide determination, it is clear that, as a result of the operation of the waiver provisions, certain order-wide likelihood determinations made by the USDOC will be based, at least in part, on statutorily-mandated assumptions about a company’s likelihood of dumping. In our view, this result is inconsistent with the obligation of an investigating authority under Article 11.3 to ‘arrive at a reasoned conclusion’ on the basis of ‘positive evidence’.”⁽¹⁰⁶⁶⁾

(d) Determination regarding likelihood or continuation or recurrence of dumping

776.   In US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina), the section 129 determination (i.e. the sunset review determination by the USDOC) was based on two findings: (1) likely past dumping, and (2) the United States Department of Commerce’s volume analysis from the original sunset review.⁽¹⁰⁶⁷⁾ In relation to the first claim, Argentina argued that reliance on past dumping was inconsistent with Article 11.3. In relation to the volume analysis, Argentina claimed that: (a) it was part of the US Department of Commerce’s measure taken to comply; and (b) that Argentine exporters had tried to explain that the decline in volume was due to other factors, which were not addressed by the USDOC.

(i) Likely past dumping

777.   The Panel in US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina) quickly dismissed Argentina’s first claim, citing an insufficient factual basis by the USDOC in its analysis of likely past dumping. This was based on the United States Department of Commerce’s failure to seek information about home market prices:

“The parties’ arguments raise two important issues. The first issue is whether the USDOC’s finding of likely past dumping was a determination of dumping. The second issue is whether the USDOC’s reliance upon a finding of likely past dumping as one of the bases of its determination of the likelihood of continuation or recurrence of dumping was consistent with Article 11.3 of the Agreement. In our view, however, a definitive resolution of these questions regarding the USDOC’s Section 129 Determination is not necessary to our assessment of Argentina’s claim. This flows from our view that even if this was not a determination of dumping as the United States asserts, and even if relying on likely past dumping was appropriate — issues which we do not here address — the USDOC’s analysis of likely past dumping lacked a sufficient factual basis.⁽¹⁰⁶⁸⁾

 

…the concept of dumping is, in the first instance, a comparison of home market and export prices. Only in the circumstances set forth in Article 2.2 may an investigating authority look to alternative bases to home market prices, such as costs, when determining normal value.⁽¹⁰⁶⁹⁾

 

In the sunset review at issue, the USDOC did not even ask Acindar to provide information regarding its normal value and export price. Rather, it restricted itself to asking for certain cost information and, when that cost information was not provided, compared Acindar’s export prices to the United States, obtained from the US customs authorities, with the prevailing prices in the US market. The failure to seek information about Acindar’s home market prices means that the USDOC made a finding of likely dumping without making any effort to obtain information that is essential to the core principle of dumping as a price-to-price comparison. We do not see how a finding of likely past dumping could have a sufficient factual basis if it did not take into account at a bare minimum these elementary aspects of the concept of dumping as that term is used in the Anti-Dumping Agreement.”⁽¹⁰⁷⁰⁾

(ii) Volume analysis

778.   The Panel in US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina) found that the volume analysis from the original sunset review was part of the “measure taken to comply”, as claimed by Argentina:

“According to the United States, since the volume analysis was incorporated by reference, without any change, and the original panel made no findings with respect to this analysis, it is not part of the measure taken to comply. We recall that the function of a compliance panel under Article 21.5 of the DSU is to assess the existence or WTO-consistency of measures taken by a Member to comply with the DSB recommendations and rulings. Thus, as a compliance panel, we base our assessment on the measure taken to comply with the DSB recommendations and rulings. The United States describes the measure taken to comply with the recommendations and rulings of the DSB in a certain manner. We do not consider, however, that we are bound by such description. In compliance proceedings under Article 21.5 of the DSU, it is for the Panel, and not the parties to the dispute, to determine what constitutes the measure taken to comply. As the United States itself acknowledges, the text of the Section 129 Determination at issue makes it clear that one of the two main underpinnings of the USDOC’s order-wide likelihood determination was the volume analysis carried over from the original sunset review. The USDOC based its order-wide determination on its finding regarding likely past dumping as well as the volume analysis from the original sunset review. As such, we consider the volume analysis from the original sunset review to have become an integral part of the Section 129 Determination. In our view, therefore, the volume analysis from the original sunset review is part of the measure taken to comply by the United States and hence is properly before us in these proceedings.”⁽¹⁰⁷¹⁾

779.   In support of its defence that the volume analysis was not part of the “measure taken to comply”, the United States argued before the Panel in US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina), that the Appellate Body decision in EC — Bed Linen (Article 21.5) supported its position. The Panel found the facts of EC — Bed Linen (Article 21.5) to be sufficiently “distinguishable from the case before us” and confirmed, given its previous findings, that the volume analysis did form part of the measure taken to comply.⁽¹⁰⁷²⁾

780.   The Panel in US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina) next considered whether the USDOC’s analysis was consistent with Article 11.3 of the Anti-Dumping Agreement given Argentina’s claim that other factors having an impact on the volume of imports had not been taken into account. In the Panel’s view, the USDOC’s finding regarding the decline in the volume of imports “was not based on a thorough evaluation of the possible causes of such decline”:⁽¹⁰⁷³⁾

“In our view, the USDOC’s finding regarding the decline in the volume of imports was not based on a thorough evaluation of the possible causes of such decline. The decline could have resulted from a variety of other factors, which could theoretically indicate no likelihood of continuation or recurrence of dumping. In other words, it is possible that despite a decline in the volume of imports, there may not be likelihood of continuation or recurrence of dumping. In fact, Siderca, in its response to the USDOC’s questionnaire, attempted to explain why the decline in the volume of Siderca’s exports to the United States following the imposition of the measure at issue did not necessarily mean that Siderca could not export with the measure in place. The United States contends that Siderca’s comments were weakly supported and did not explain why Siderca stopped shipping to the United States. The United States may or may not be correct in its proposition. We are by no means suggesting that Siderca’s arguments should have been accepted by the USDOC. The fact remains, however, that the Section 129 Determination fails to examine potential reasons, other than a likelihood of continuation or recurrence of dumping, that could have triggered the decline in the volume of imports. This is not, in our view, the kind of determination that would be made by an unbiased and objective investigating authority. The USDOC’s determination regarding the decline in the volume of imports lacks a sufficient factual basis.”⁽¹⁰⁷⁴⁾

781.   The Panel in US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina) concluded that the USDOC’s order-wide determination was inconsistent with Article 11.3 of the Anti-Dumping Agreement. This finding was appealed by the United States.

782.   The Appellate Body in US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina) upheld the Panel’s finding that the USDOC’s finding on import volumes was part of the “measure taken to comply”. Accordingly, the Panel’s findings regarding the decline in the volume of imports were also upheld:

“The USDOC’s reasoning in the Section 129 Determination indicates that the two factual premises operated together to support the determination of likelihood of dumping. The affirmative determination of likelihood of dumping follows consideration of both the finding of likely dumping during the time the anti-dumping duty order was in place and the finding that the volume of imports declined after the imposition of the order. Because the likelihood-of-dumping determination in the Section 129 Determination is premised on both bases, which together support the affirmative likelihood determination, we consider that the USDOC’s finding that the volume of imports declined after imposition of the anti-dumping duty order is an integral part of the ‘measure taken to comply’ in this case.…

 

We further note that the Appellate Body considered in US — Softwood Lumber IV (Article 21.5 — Canada) that ‘[s]ome measures with a particularly close relationship to the declared “measure taken to comply”, and to the recommendations and rulings of the DSB, may also be susceptible to review by a panel acting under Article 21.5.’ The Appellate Body noted that this ‘requires an Article 21.5 panel to examine the factual and legal background against which a declared “measure taken to comply” is adopted’ because ‘[o]nly then is a panel in a position to take a view as to whether there are sufficiently close links for it to characterize such an other measure as one “taken to comply” and, consequently, to assess its consistency with the covered agreements in an Article 21.5 proceeding.’ If a measure that is formally separate from, but closely linked to, a declared ‘measure taken to comply’ can fall within the scope of an Article 21.5 proceeding, this would suggest a fortiori that, when both factual bases are relied upon for a likelihood-of-dumping determination, they can be considered by an Article 21.5 panel when assessing the consistency of that determination with Article 11.3.

…

Furthermore, we recall that the aim of Article 21.5 of the DSU is to promote the prompt compliance with DSB recommendations and rulings and the consistency of ‘measures taken to comply’ with the covered agreements by making it unnecessary for a complainant to begin new proceedings and by making efficient use of the original panellists and their relevant experience. These considerations support the Panel’s finding that the volume analysis was properly before it. Requiring Argentina to initiate new WTO proceedings against the United States in order to challenge the USDOC’s finding on import volumes would entail a significant delay. Moreover, it would be difficult to reconcile this with the objective that Article 21.5 panels ‘examine fully the “consistency with a covered agreement of the measures taken to comply”, as required by [that provision]’. Finally, it seems difficult to conceive how the two factual bases could each be examined by separate panels (one of which is operating pursuant to Article 21.5), considering that both factual premises together support the USDOC’s likelihood-of-dumping determination.”⁽¹⁰⁷⁵⁾

(e) Order-wide basis of a likelihood determination

783.   In its report on US — Corrosion-Resistant Steel Sunset Review, the Appellate Body addressed the question whether authorities must make a separate determination, for each individual exporter or producer, on whether the expiry of the duty would be likely to lead to continuation or recurrence of dumping by that exporter or producer or whether it would be possible to make a single order-wide determination on whether revocation of a particular anti-dumping duty order would be likely to lead to continuation or recurrence of dumping. The Appellate Body considered that, on its face, Article 11.3 does not oblige investigating authorities in a sunset review to make “company-specific” likelihood determinations:

“We reiterate that Article 11.3 does not prescribe any particular methodology to be used by investigating authorities in making a likelihood determination in a sunset review. In particular, Article 11.3 does not expressly state that investigating authorities must determine that the expiry of the duty would be likely to lead to dumping by each known exporter or producer concerned. In fact, Article 11.3 contains no express reference to individual exporters, producers, or interested parties. This contrasts with Article 11.2, which does refer to ‘any interested party’ and ‘[i]nterested parties’. We also note that Article 11.3 does not contain the word ‘margins’, which might implicitly refer to individual exporters or producers. On its face, Article 11.3 therefore does not oblige investigating authorities in a sunset review to make ‘company-specific’ likelihood determinations in the manner suggested by Japan.”⁽¹⁰⁷⁶⁾

784.   In the compliance proceeding, the Panel in US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina) noted that following the regulatory amendments in the United States, the waiver provisions only required the USDOC to find likelihood of continuation or recurrence of dumping with respect to exporters who affirmatively waived their right to participate. However, the US law also required the USDOC to make its sunset determinations on an order-wide basis. Therefore, the question for the Panel was what impact, if any, a company-specific determination of likelihood might have on the USDOC’s order-wide determination:⁽¹⁰⁷⁷⁾

“We find it difficult to understand how the USDOC would find no likelihood of continuation or recurrence of dumping on an order-wide basis in a sunset review where it may have made an affirmative likelihood determination for some exporters pursuant to Section 751(c)(4)(B) of the Tariff Act. Given that Section 751(c)(4)(B) requires the USDOC to make an affirmative likelihood determination for individual exporters who waive their right to participate, it seems to us that such company-specific determinations would necessarily have a significant impact on, or even determine, the outcome of the USDOC’s order-wide determination. Hence, we can reasonably conclude that in every sunset review involving multiple exporters the USDOC will have to find likelihood on an order-wide basis if one exporter waives its right to participate, because otherwise the USDOC would have found no likelihood with respect to the exporters who waive their right to participate.

 

Making an affirmative finding of likelihood of continuation or recurrence of dumping from a country without considering the information that may have been submitted by exporters who do not waive their right to participate in the sunset review would not, in our view, be a reasoned determination premised on an adequate factual basis. As we noted above, the investigating authorities are expected to be sufficiently active in sunset reviews in developing the necessary factual premise for their determinations. The provisions of Section 751(c)(4)(B) of the Tariff Act, however, would preclude the USDOC from taking into consideration evidence submitted by cooperating exporters or evidence otherwise collected by the USDOC in sunset reviews where there is at least one other exporter who waives its right to participate. In such cases, the USDOC’s order-wide determination would be based on the assumption that because one exporter waived its right to participate and acknowledged to be likely to continue or resume dumping, other exporters are also likely to continue or resume dumping. The USDOC would thus be ignoring the information which is relevant to its sunset determination and which is readily available to it and would fail to observe the obligation of the investigating authorities to make reasoned determinations of likelihood of continuation or recurrence of dumping based on a sufficient factual premise in accordance with Article 11.3 of the Agreement.”⁽¹⁰⁷⁸⁾

785.   The Panel in US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina) found that Section 751(c)4(B) of the Tariff Act, operating in conjunction with Section 751(c)(4)(A) of the Tariff Act and Section 351.218(d)(2) of the Regulations, was inconsistent with Article 11.3 of the Anti-Dumping Agreement. The Appellate Body in US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina) however disagreed with the Panel’s analysis “for several reasons”, and reversed the Panel’s finding:

“First, the Panel did not fully appreciate the consequences that flow from the fact that, under the amended waiver provisions, the company-specific findings are now based on positive evidence taking the form of an admission. Secondly … Argentina did not set out to demonstrate that the company-specific findings determine the outcome of the order-wide determination. Rather, Argentina sought to prove that ‘the order-wide determination will be based, at least in part, on statutorily-mandated findings’, which Argentina claims is sufficient to establish a violation of Article 11.3 of the Anti-Dumping Agreement.

 

In addition, we note that the Panel concluded that the amended waiver provisions ‘would preclude the USDOC from taking into consideration evidence submitted by cooperating exporters or evidence otherwise collected by the USDOC in sunset reviews where there is at least one other exporter who waives its right to participate’. The Panel also concluded that ‘company-specific determinations would necessarily have a significant impact on, or even determine, the outcome of the USDOC’s order-wide determination.’ However, the United States emphasized before the Panel that, ‘[i]n making its order-wide determination, [the USDOC] must consider all information and argument on the record of the sunset proceeding.’ Furthermore, the United States pointed out that ‘the relevance of … a company-specific finding to the ultimate likelihood determination always would depend on the facts on the administrative record in that sunset review.’

  

We observe that a respondent’s explanation of the basis on which its investigating authority will make a determination will have more weight if it is confirmed by the text of the applicable laws or regulations. But the United States’ statements that the USDOC must consider all information and arguments on the record, and that the relevance of a company-specific finding to the order-wide likelihood determination would always depend on the facts of each case, cannot be rejected merely because there is no legal instrument that expressly requires the USDOC to act in this way. This is insufficient to support properly a finding of inconsistency as such. Thus, the Panel’s reasoning seems speculative, and this is reflected in the language used in the Panel Report.

 

In sum, on the basis of the evidence on the Panel record, we are not persuaded that the amended waiver provisions preclude the USDOC from making a reasoned determination with a sufficient factual basis, as required by Article 11.3 of the Anti-Dumping Agreement. Under the amended waiver provisions, a company-specific finding is not based on an assumption but, rather, on a statement by the waiving exporter indicating that it is likely to dump if the order were revoked or the investigation terminated. Moreover, the amended waiver provisions do not preclude the USDOC from considering other evidence on the record of the sunset review. Indeed, under Article 11.3 of the Anti-Dumping Agreement, the USDOC would have to consider any other evidence on the record, and assess the statement of waiver in the light of that other evidence, before making the order-wide determination. If it failed to do so, it would not exercise the degree of diligence required of investigating authorities, nor could it make a reasoned determination with a sufficient factual basis, as required by Article 11.3 of the Anti-Dumping Agreement.”⁽¹⁰⁷⁹⁾

(f) No prescribed time-frame for likelihood of continuation or recurrence of injury

786.   The Panel in US — Oil Country Tubular Goods Sunset Reviews noted that Article 11.3 of the Anti-Dumping Agreement does not prescribe any timeframe for likelihood of continuation or recurrence of injury; nor does it require investigating authorities to specify the time-frame on which their likelihood determination is based:

“As we already stated, Article 11.3 does not impose a particular time-frame on which the investigating authority has to base its likelihood determination. Further, in our view, the investigating authority does not have to base its likelihood determination on a uniform time-frame with respect to each injury factor that it takes into consideration. The time-frame regarding different injury factors may be different from one another depending on the circumstances of each sunset review. For instance, in a case where the exporters have excessive inventories, the investigating authority’s evaluation of likely volume of dumped imports can be based on a relatively short timeframe. On the other hand, an analysis regarding the cash flows or productivity of the domestic industry may necessarily have to be based on a longer time-frame.”⁽¹⁰⁸⁰⁾

787.   The Appellate Body in US — Oil Country Tubular Goods Sunset Reviews agreed with the Panel that “an assessment regarding whether injury is likely to recur that focuses ‘too far in the future would be highly speculative’⁽¹⁰⁸¹⁾, and that it might be very difficult to justify such an assessment. However, like the Panel, we have no reason to believe that the standard of a ‘reasonably foreseeable time’ set out in the United States statute is inconsistent with the requirements of Article 11.3.”⁽¹⁰⁸²⁾ The Appellate Body rejected the argument that the requirement set out in Article 3.7 that the threat of material injury be “imminent” is to be imported into Article 11.3 in the form of a temporal limitation on the time-frame within which “injury” must be determined to continue or recur. The Appellate Body considered that “sunset reviews are not subject to the detailed disciplines of Article 3, which include the specific requirement of Article 3.7”.⁽¹⁰⁸³⁾

788.   In addition, the Appellate Body in US — Oil Country Tubular Goods Sunset Reviews rejected the argument that an authority would be required to specify the relevant time-frame for injury to continue or recur for the authority’s determination to be a “properly reasoned and supported determination”:

“As we have noted above, the text of Article 11.3 does not establish any requirement for the investigating authority to specify the time-frame on which it bases its determination regarding injury. Thus, the mere fact that the time-frame of the injury analysis is not presented in a sunset review determination is not sufficient to undermine that determination. Article 11.3 requires that a determination of likelihood of continuation or recurrence of injury rest on a sufficient factual basis to allow the investigating authority to draw reasoned and adequate conclusions. A determination of injury can be properly reasoned and rest on a sufficient factual basis even though the time-frame for the injury determination is not explicitly mentioned.”⁽¹⁰⁸⁴⁾

(g) Applicability of procedural obligations

(i) Evidentiary standards for initiation

789.   The Panel in US — Corrosion-Resistant Steel Sunset Review rejected the argument that the same evidentiary standards that apply to the self-initiation of original investigations under Article 5.6 also apply to the self-initiation of sunset reviews under Article 11.3. The Panel based itself on the text of Article 11.3:

“As Japan concedes, Article 11.3, on its face, does not mention, either explicitly or by way of reference, any evidentiary standard that should or must apply to the self-initiation of sunset reviews. Article 11.3 contemplates initiation of a sunset review in two alternative ways, as is evident through the use of the word ‘or’. Either the authorities make their determination in a review initiated ‘on their own initiative’, or they make their determination in a review initiated ‘upon a duly substantiated request made by or on behalf of the domestic industry’. Although Article 11.3 provides for a certain qualification regarding initiations based on complaints lodged by the domestic industry — that such requests be ‘duly substantiated’ — the text clearly indicates that this qualification is germane only to that specific situation and does not apply to self-initiations. Consequently, since the drafters did not set forth any evidentiary requirements for the self-initiation of sunset reviews in the text of Article 11.3 itself, at first blush, it seems to us that they intended not to impose any evidentiary standards in respect of the self-initiation of a sunset review.”⁽¹⁰⁸⁵⁾

790.   The Panel in US — Corrosion-Resistant Steel Sunset Review found further support for its conclusion in the absence of any cross-referencing in Article 11 to the evidentiary standards concerning original investigations in Article 5.6:

“Although paragraphs 4 and 5 of Article 11 contain several cross-references to other articles in the Anti-Dumping Agreement, no such cross-reference has been made in the text of Article 11 to Article 5.6. These cross-references (as well as other cross-references in the Anti-Dumping Agreement, such as, for example, in Article 12.3) indicate that, when the drafters intended to make a particular provision also applicable in a different context, they did so explicitly. Therefore, their failure to include a cross-reference in the text of Article 11.3, or, for that matter, in any other paragraph of Article 11, to Article 5.6 (or vice versa) demonstrates that they did not intend to make the evidentiary standards of Article 5.6 applicable to sunset reviews.”⁽¹⁰⁸⁶⁾

(ii) New factual basis

791.   The Panel in US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina) rejected Argentina’s claim that the US Department of Commerce acted inconsistently with Articles 11.3 and 11.4 by developing a new factual basis pertaining to the original review period for the purposes of a sunset review. The Panel drew on Mexico — Corn Syrup, Australia — Salmon, and Japan — Apples for support in concluding that “WTO Members may need to collect new information supplementary to that on the record of their original determinations in making subsequent determinations in the context of implementing the DSB recommendations and rulings.”⁽¹⁰⁸⁷⁾ Argentina appealed this finding, but was unsuccessful.

792.   In the appeal on US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina) Argentina made an argument that rested on a distinction between clarifying or explaining the original sunset determination, which would, in Argentina’s view, be possible; and developing a new evidentiary basis for a redetermination because an investigating authority had not “developed an adequate evidentiary foundation for its original sunset determination”, which Argentina submitted would not be possible under Articles 11.3 and 11.4.⁽¹⁰⁸⁸⁾ Argentina also argued that allowing an investigating authority to develop a new evidentiary basis would “reduce to inutility the temporal limitations set out in Articles 11.3 and 11.4”. The Appellate Body was not convinced by Argentina’s arguments:

“Articles 11.3 and 11.4 [do not] provide a basis for drawing a distinction between allowing an investigating authority to clarify information, or provide further explanations, on the one hand, and to develop a new factual basis, on the other hand. At the oral hearing, Argentina itself recognized that an investigating authority clarifying information, or providing further explanations, would be allowed to gather additional information and develop some new facts relating to the original sunset review period. This illustrates the difficulty of drawing the distinction relied upon by Argentina, where collection of some facts is allowed to clarify information or provide further explanations, but not to develop a new factual basis.

 

Article 11.3 of the Anti-Dumping Agreement does not refer to the steps that an investigating authority may take to implement DSB recommendations and rulings or to the collection of evidence at that stage. Article 11.4 states that the provisions of Article 6 of the Anti-Dumping Agreement regarding evidence and procedure are applicable to sunset reviews. Article 6 contains several provisions relating to the collection of evidence, including several time periods. However, like Articles 11.3 and 11.4, Article 6 does not specifically refer to the collection of evidence for purposes of implementing DSB recommendations and rulings. Therefore, we do not consider that Articles 11.3 and 11.4 address the specific question of whether an investigating authority can develop a new evidentiary basis when implementing DSB recommendations and rulings.

…

Argentina argues, furthermore, that allowing an investigating authority to develop a new evidentiary basis would reduce to inutility the temporal limitations set out in Articles 11.3 and 11.4 of the Anti-Dumping Agreement. We do not share this view. As explained above, Argentina’s claim that the USDOC was precluded from developing a new evidentiary basis is premised on the qualitative shortcomings of the fact-finding in the original review. It does not implicate the temporal requirements of Article 11.3, which remain valid even if an investigating authority is allowed to collect additional facts relating to the original review period when making a re-determination of the likelihood of dumping for the purpose of implementing recommendations and rulings of the DSB. Moreover, an investigating authority seeking to comply with an adverse WTO ruling by conducting a sunset re-determination would have to comply with all of the substantive obligations set out in Articles 11.3 and 11.4. This means that any additional factual information relating to the initial review period that is collected for purposes of the redetermination would have to be ‘sufficient’, and the conclusion reached on the basis of those facts would have to be ‘reasoned’. It also means that the anti-dumping duties could not remain in place unless the investigating authority concluded in the re-determination that dumping and injury were likely to continue or recur. Furthermore, the due process and evidentiary obligations established in Article 11.4, by virtue of its reference to Article 6, would apply also to the process leading to the re-determination.”⁽¹⁰⁸⁹⁾

(iii) De minimis standard in sunset reviews

793.   The Panel in US — Corrosion-Resistant Steel Sunset Review rejected the argument that the Anti-Dumping Agreement requires that the same de minimis standard that applies to investigating authorities under Article 5.8 also applies to sunset reviews under Article 11.3:

“On its face, Article 11.3 does not provide, either explicitly or by way of reference, for any de minimis standard in making the likelihood of continuation or recurrence of dumping determinations in sunset reviews. Therefore, Article 11.3 itself is silent as to whether the de minimis standard of Article 5.8 (or any other de minimis standard) is applicable to sunset reviews. However, ‘[s]uch silence does not exclude the possibility that the requirement was intended to be included by implication.’

 

We therefore look to the context of Article 11.3. The immediate context of Article 11.3 does not, however, yield a different result. Article 11.1 sets out the general rule that an anti-dumping duty can remain in force only as long as and to the extent necessary to counteract injurious dumping. Articles 11.2 and 11.3 reflect the application of that general rule under different circumstances. Article 11.4 contains a cross-reference to Article 6, which sets forth rules relating to evidence and procedure applicable to investigations. Given that, similar to Article 6, Article 5 also contains rules applicable to original investigations, we consider the absence in Article 11.4 of a similar cross-reference to Article 5 to indicate that the drafters did not intend to have the obligations in Article 5 apply also to sunset reviews.”⁽¹⁰⁹⁰⁾

794.   In the view of the Panel in US — Corrosion-Resistant Steel Sunset Review, it was clear that Article 5.8 did not suggest that the de minimis standard set out for investigations also applied to sunset reviews:

“In particular, the text of paragraph 8 of Article 5 refers expressly to the termination of an investigation in the event of de minimis dumping margins. There is, therefore, no textual indication in Article 5.8 that would suggest or require that the obligation in Article 5.8 also applies to sunset reviews. Nor is there any such suggestion or requirement in the other provisions of Article 5.”⁽¹⁰⁹¹⁾

795.   On the basis of this textual analysis of the relevant provisions of the Anti-Dumping Agreement, the Panel in US — Corrosion-Resistant Steel Sunset Review concluded that the 2 per cent de minimis standard of Article 5.8 does not apply in the context of sunset reviews.⁽¹⁰⁹²⁾

(iv) Cumulation

Whether cumulation is permissible in sunset reviews

796.   The Appellate Body in US — Oil Country Tubular Goods Sunset Reviews examined the question whether cumulation is permissible in sunset reviews. It found that, while Articles 3.3 and 11.3 are silent on this issue, this silence “cannot be understood to imply that cumulation is prohibited in sunset reviews”.⁽¹⁰⁹³⁾ The Appellate Body, recalling the apparent rationale behind the practice of cumulation in injury investigations as discussed by the Appellate Body in EC — Tube or Pipe Fittings⁽¹⁰⁹⁴⁾ considered that this rationale is equally applicable to likelihood-of-injury determinations in sunset reviews. The Appellate Body thus concluded that cumulation in sunset reviews is permissible:

“Therefore, notwithstanding the differences between original investigations and sunset reviews, cumulation remains a useful tool for investigating authorities in both inquiries to ensure that all sources of injury and their cumulative impact on the domestic industry are taken into account in an investigating authority’s determination as to whether to impose — or continue to impose — anti-dumping duties on products from those sources. Given the rationale for cumulation — a rationale that we consider applies to original investigations as well as to sunset reviews — we are of the view that it would be anomalous for Members to have limited authorization for cumulation in the Anti-Dumping Agreement to original investigations”.⁽¹⁰⁹⁵⁾

Non-application of negligibility standards

797.   The Panel in US — Corrosion-Resistant Steel Sunset Review considered that the negligibility standards under Article 5.8 for the purposes of a cumulative injury assessment under Article 3.3 in original investigations, do not apply to sunset reviews under Article 11.3:

“Article 11.3 speaks of a review to determine, inter alia, the likelihood of continuation or recurrence of injury. On its face, Article 11.3 does not mention, either explicitly or by way of reference, any negligibility standard that applies to the likelihood of continuation or recurrence of injury determinations in sunset reviews. Nor does the immediate context of Article 11.3 yield a different result. Article 11.1 sets out the general rule that an antidumping duty can remain in force only as long as and to the extent necessary to counteract injurious dumping. Article 11.2 and 11.3 reflect the application of that general rule under different circumstances. Although paragraphs 4 and 5 of Article 11 contain several cross-references to other articles of the Anti-Dumping Agreement, no such cross-reference has been made to Articles 3.3 or 5.8.”⁽¹⁰⁹⁶⁾

798.   The Panel in US — Corrosion-Resistant Steel Sunset Review considered that “Article 3.3, by its own terms, is limited in application to investigations and does not apply to sunset reviews. It follows that the cross-reference in Article 3.3 to the negligibility standard in Article 5.8 does not apply to sunset reviews”⁽¹⁰⁹⁷⁾

799.   The Panel in US — Oil Country Tubular Goods Sunset Reviews similarly found that cumulation, when used in sunset reviews, does not need to satisfy the conditions of Article 3.3 because “by its own terms Article 3.3 limits its scope of application to investigations”.⁽¹⁰⁹⁸⁾ The Appellate Body agreed with the Panel “that the conditions of Article 3.3 do not apply to likelihood-of-injury determinations in sunset reviews”.⁽¹⁰⁹⁹⁾

(h) “likely”

800.   The US — DRAMS Panel interpreted the term “likely” in Article 11.2 with reference to Article 11.3. See paragraph 749 above.

801.   The Appellate Body in US — Oil Country Tubular Goods Sunset Reviews considered “that the ‘likely’ standard of Article 11.3 applies to the overall determinations regarding dumping and injury; it need not necessarily apply to each factor considered in rendering the overall determinations on dumping and injury”.⁽¹¹⁰⁰⁾

(i) Relationship with other paragraphs of Article 11

802.   The relationship between Article 11.3 and Article 11.2 was addressed in US — DRAMS. See paragraphs 742 and 749 above.

803.   The Panel in US — DRAMS also referred to footnote 22 to Article 11.3 in interpreting Article 11.2. See paragraph 743 above.

(j) Relationship with the standard of review in Article 11 of the DSU

804.   The Appellate Body in US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina) rejected Argentina’s claim that the Panel had not made an objective assessment of the matter before it, as required by Article 11 of the DSU.

“We note that Argentina considers that the Panel failed to fulfil properly its duties under Article 11 of the DSU by ‘subordinat[ing] the actual treaty text of Articles 11.3 and 11.4, and the disposition of Argentina’s claims under these provisions, to broader, “systemic” considerations of the WTO dispute settlement system’. We have found that Articles 11.3 and 11.4 do not address specifically whether an investigating authority may collect additional facts relating to the initial review period when making a re-determination of likelihood of dumping. Therefore, the Panel did not subordinate the text of these provisions to broader systemic considerations of the WTO dispute settlement system when it found that the USDOC could develop a new evidentiary basis.”⁽¹¹⁰¹⁾

(k) Existence of a causation requirement in sunset reviews

805.   In US — Anti-Dumping Measures on Oil Country Tubular Goods, Mexico challenged the Panel’s interpretation of Article 11.3 and “its failure to address the ‘inherent’ causation requirements under that Article.”⁽¹¹⁰²⁾ In particular, Mexico contested the Panel’s finding that the obligations set out in Article 3 are not directly applicable in sunset reviews. The Appellate Body in US — Anti-Dumping Measures on Oil Country Tubular Goods considered that:

“On its face, Article 11.3 does not require investigating authorities to establish the existence of a ‘causal link’ between likely dumping and likely injury. Instead, by its terms, Article 11.3 requires investigating authorities to determine whether the expiry of the duty would be likely to lead to continuation or recurrence of dumping and injury. Thus, in order to continue the duty, there must be a nexus between the ‘expiry of the duty’, on the one hand, and ‘continuation or recurrence of dumping and injury’, on the other hand, such that the former ‘would be likely to lead to’ the latter. This nexus must be clearly demonstrated.⁽¹¹⁰³⁾ In this respect, we further note that, under Article 11.3 of the Anti-Dumping Agreement, the termination of the anti-dumping duty at the end of five years is the rule and its continuation beyond that period is the ‘exception’.”⁽¹¹⁰⁴⁾

806.   The Appellate Body in US — Anti-Dumping Measures on Oil Country Tubular Goods observed that while Article 11.3 is “silent” on the issue of a “causal link”, there could be a requirement to establish a causal link between likely dumping and likely injury in a sunset review under Article 11.3 flowing from other provisions of the Anti-Dumping Agreement and Article VI of GATT 1994.⁽¹¹⁰⁵⁾ The Appellate Body then opined:

“It is clear from Article VI of the GATT 1994 and the above-mentioned provisions of the Anti-Dumping Agreement, and indeed from the design and structure of that Agreement as a whole, that the Anti-Dumping Agreement deals with counteracting injurious dumping and that an anti-dumping duty can be imposed and maintained only if the dumping (as properly established) causes injury to the domestic industry. Absent injury to the domestic industry, the rationale for either imposing the duty in the first place, or maintaining it at any time after its imposition, does not exist.⁽¹¹⁰⁶⁾ A causal link between dumping and injury to the domestic industry is thus fundamental to the imposition and maintenance of an anti-dumping duty under the Anti-Dumping Agreement.

 

… However, this does not mean that a causal link between dumping and injury is required to be established anew in a ‘review’ conducted under Article 11.3 of the Anti-Dumping Agreement. This is because the ‘review’ contemplated in Article 11.3 is a ‘distinct’ process with a ‘different’ purpose from the original investigation.⁽¹¹⁰⁷⁾”⁽¹¹⁰⁸⁾

807.   The Appellate Body in US — Anti-Dumping Measures on Oil Country Tubular Goods observed that for an affirmative determination under Article 11.3 what is essential is “proof of likelihood of continuation or recurrence of dumping and injury, if the duty expires”⁽¹¹⁰⁹⁾:

“[W]hen a ‘review’ takes place under Article 11.3, and it is determined that the ‘expiry of the duty’ would ‘likely … lead to continuation or recurrence of dumping and injury’, it is reasonable to assume that, where dumping and injury continues or recurs, the causal link between dumping and injury, established in the original investigation, would exist and need not be established anew.” ⁽¹¹¹⁰⁾

 

“The nexus to be demonstrated is between ‘the expiry of the duty’ on the one hand, and the likelihood of ‘continuation or recurrence of dumping and injury’ on the other hand …”⁽¹¹¹¹⁾

808.   The Appellate Body in US — Anti-Dumping Measures on Oil Country Tubular Goods said that its conclusion that the establishment of a causal link between likely dumping and likely injury is not required in a sunset review determination does not imply that the causal link between dumping and injury envisaged by Article VI of the GATT 1994 and the Anti-Dumping Agreement is severed in a sunset review and that “it only means that re-establishing such a link is not required, as a matter of legal obligation, in a sunset review.”⁽¹¹¹²⁾

809.   The Appellate Body in US — Anti-Dumping Measures on Oil Country Tubular Goods stated that where the likelihood-of-dumping determination is flawed, “it does not follow that the likelihood-of-injury determination is ipso facto flawed as well.” However, it added that “if a likelihood-of-injury determination rests upon a likelihood-of-dumping determination that is later found to be flawed, the former determination may also be found to be WTO-inconsistent, after a proper examination of the facts of that determination.”⁽¹¹¹³⁾

810.   The Appellate Body in US — Anti-Dumping Measures on Oil Country Tubular Goods rejected Mexico’s argument that the text of Article 11.3 does not establish a requirement for an investigating authority to specify the time-frame within which the “simultaneous presence” of subject imports and the corresponding likely injury would occur. The Appellate Body noted that “as long as a likelihood-of injury determination rests on a sufficient factual basis, the mere fact that an investigating authority does not specify the time-frame within which the ‘simultaneous presence’ of subject imports and the corresponding injury would be likely to occur, does not, in our view, undermine that determination.”⁽¹¹¹⁴⁾

(l) Cumulation in sunset reviews

811.   In US — Anti-Dumping Duties on Oil Country Tubular Goods, Mexico argued that the ITC was under a separate obligation to “ensure that cumulation was appropriate in light of the conditions of competition,” and to do so it was “required” to make “a threshold finding that the subject imports would be simultaneously present in the U.S. market.” The Appellate Body in US — Anti-Dumping Duties on Oil Country Tubular Goods said there was no textual basis in Article 11.3 for requiring such a finding, noting that:

“[I]n order to arrive at a reasoned and adequate conclusion, an examination of whether imports are in the market together and competing against each other may, in certain cases, be needed in a likelihood-of-injury determination where an investigating authority chooses to cumulate the imports from several countries. But the need for such an examination flows from the particular facts and circumstances of a given case and not from a legal requirement under Article 11.3.”⁽¹¹¹⁵⁾

812.   The Appellate Body in US — Anti-Dumping Measures on Oil Country Tubular Goods, rejecting Mexico’s argument, noted that an investigating authority is not required, under Article 11.3 of the Anti-Dumping Agreement, to make a separate threshold finding regarding simultaneous presence of imports. Furthermore, it disagreed with Mexico that the ITC’s approach did not reflect a prospective analysis, based on positive evidence, of whether imports from the five cumulated countries were likely to be simultaneously present in the market in the event of termination of the anti-dumping duty order, noting in particular that the information collected by the ITC related to current market conditions “is relevant as a basis to draw reasoned conclusions regarding likely future market conditions”.⁽¹¹¹⁶⁾

813.   The Appellate Body in US — Anti-Dumping Measures on Oil Country Tubular Goods recalled its holding in US — Oil Country Tubular Goods Sunset Reviews that:

“‘the “likely” standard of Article 11.3 applies to the overall determinations regarding dumping and injury’ … ‘it need not necessarily apply to each factor considered in rendering the overall determinations on dumping and injury.’⁽¹¹¹⁷⁾ Even assuming, arguendo, that it might apply to the USITC’s ‘assessment of likelihood of simultaneity,’ we do not agree with Mexico that the USITC used a standard that is inconsistent with Article 11.3 ‘[b]y requiring a demonstration that the imports “would not” be simultaneously in the market.’⁽¹¹¹⁸⁾ Although the USITC made reference to the fact that nothing in the Panel record indicates that the products would not be simultaneously present, it cited other reasons as well.”⁽¹¹¹⁹⁾

814.   In US — Anti-Dumping Measures on Oil Country Tubular Goods, Mexico argued that, having decided to cumulate Mexican imports with imports from the other four countries that were cumulated in the original investigation, the ITC was required to do so consistently with the requirements of Article 3.3, regardless of whether that provision applies directly to sunset reviews. The Appellate Body again recalled its findings in US — Anti-Dumping Measures on Oil Country Tubular Goods that:

“[T]he ‘text of Article 3.3 plainly limits its applicability to original investigations’⁽¹¹²⁰⁾ and … ‘the conditions of Article 3.3 do not apply to likelihood-of-injury determinations in sunset reviews.’ ⁽¹¹²¹⁾ The fact that an investigating authority has not undertaken all the analyses detailed in Article 3.3 is not, by itself, sufficient to undermine a determination under Article 11.3.”⁽¹¹²²⁾

815.   The Appellate Body in US — Anti-Dumping Measures on Oil Country Tubular Goods emphasized:

“We do not, however, suggest, that when an authority chooses to cumulate imports in a likelihood-of-injury determination under Article 11.3, it is never necessary for it to determine whether such a cumulative assessment is appropriate in the light of the conditions of competition in the marketplace. In particular cases, a cumulative assessment of the effects of the imports may be found to be inappropriate and, therefore, inconsistent with the fundamental requirement that a determination rest on a sufficient factual basis and reasoned and adequate conclusions.⁽¹¹²³⁾”⁽¹¹²⁴⁾

(m) Qualitative assessment of determinations under Article 11.3

816.   The Appellate Body in US — Anti-Dumping Measures on Oil Country Tubular Goods reversed the Panel’s finding that Section II.A.3 of the Sunset Policy Bulletin (SPB), as such, was inconsistent with Article 11.3. because it found that in assessing the consistency of the SPB, as such, with Article 11.3, the Panel failed to make an objective assessment of the matter, including an objective assessment of the facts of the case, as required by Article 11 of the DSU.⁽¹¹²⁵⁾ Criticizing the Panel’s “qualitative assessment” of the DOC determinations, the Appellate Body concluded that:

“[T]he Panel’s analysis does not reveal that the affirmative determinations, in the 21 specific cases reviewed by it⁽¹¹²⁶⁾, were based exclusively on the scenarios to the disregard of other factors. Nor does the Panel’s review of these cases reveal that the USDOC’s affirmative determinations were based solely on the SPB scenarios, when the probative value of other factors might have outweighed that of the identified scenarios. Accordingly we conclude that the Panel did not conduct a ‘qualitative assessment’ of the USDOC’s determination such that the Panel could properly conclude that the SPB requires the USDOC to treat the factual scenarios of Section II.A.3 of the SPB as determinative or conclusive.”⁽¹¹²⁷⁾

817.   In relation to the “qualitative assessment” of individual determinations to be carried out by a panel, the Appellate Body in US — Anti-Dumping Measures on Oil Country Tubular Goods noted that the relevance and probative value of other factors is crucial.⁽¹¹²⁸⁾

818.   The Appellate Body in US — Anti-Dumping Measures on Oil Country Tubular Goods noted that the responding parties have a responsibility to submit information and evidence in their favour, particularly about their pricing behaviour, import volumes, and dumping margins, while the investigating authority “has a duty to seek out information on relevant factors and evaluate their probative value in order to ensure that its determination is based not on presumptions, but on a sufficient factual basis.”⁽¹¹²⁹⁾

4. Article 11.4

819. The Panel and Appellate Body in US — Oil Country Tubular Goods Sunset Reviews — Article 21.5 (Argentina) rejected Argentina’s claim that the US Department of Commerce acted inconsistently with Articles 11.3 and 11.4 by developing a new factual basis pertaining to the original review period for the purposes of a sunset review. See paragraphs 791–792 above.

5. Relationship with other Articles

(a) Article 3

820.   The Panel in US — DRAMS discussed the relationship between footnote 9 to Article 3 and Article 11.2. See paragraph 751 above.

821.   The Panel in US — DRAMS also discussed the relationship between Articles 3.5 and 11.2. See paragraph 751 above.