DS: Dominican Republic — Anti-dumping Measures on Corrugated Steel Bars
This summary has been prepared by the Secretariat under its own responsibility. The summary is for general information only and is not intended to affect the rights and obligations of Members.
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Summary of the dispute to date
The summary below was up-to-date at
Complaint by Costa Rica
On 23 July 2021, Costa Rica requested consultations with the Dominican Republic with respect to antidumping measures imposed on the importation of corrugated or deformed steel bars or rods for the reinforcement of concrete originating in Costa Rica.
Costa Rica claimed that the measures at issue appear to be inconsistent with:
- Articles 1, 2.1, 2.2, 2.2.1, 2.4, 3.1, 3.2, 3.4, 3.5, 3.7, 5.1, 5.3, 5.8, 6.1, 6.1.3, 6.2, 6.4, 6.5, 6.5.1, 6.7, 6.9, 9.3 and 12.1.1 and Annex I of the Anti-Dumping Agreement; and
- Articles VI and VI:2 of the GATT 1994.
Panel and Appellate Body proceedings
On 15 November 2021, Costa Rica requested the establishment of a panel. At its meeting on 29 November 2021, the DSB deferred the establishment of the panel.
At its meeting on 20 December 2021, the DSB established a panel. Canada, China, the European Union, India, Japan, Mexico, the Russian Federation, and the United States reserved their third-party rights.
On 28 March 2022, Costa Rica requested the Director-General to compose the panel. On 8 April 2022, the Director-General composed the panel.
On 7 October 2022, the Chair of the panel informed the DSB that in view of the Working Procedures and the Timetable that were prepared in consultation with the parties, and due to the complexity of the case and the parties' requests for additional time to prepare their submissions, the panel did not expect to issue its final report to the parties before the first quarter of 2023. The Chair apprised the DSB that the report would be available to the public once it was circulated to the Members in all three official languages, and that the date of circulation depends on completion of translation. On 7 February 2023, the Chair of the panel informed the DSB that the panel expected to issue its final report to the parties by the end of the second quarter of 2023.
This dispute concerned a challenge to the Dominican Republic's imposition of anti-dumping duties on imports of corrugated or deformed steel bars or rods for concrete or concrete reinforcement from Costa Rica. Costa Rica challenged the determination of the existence of dumping and the calculation of the margin of dumping by the Dominican Republic's anti-dumping investigating authority, La Comisión Reguladora de Prácticas Desleales en el Comercio y sobre Medidas de Salvaguardias (CDC). Costa Rica additionally challenged the CDC's injury determination regarding dumped imports from Costa Rica as well as various procedural aspects of the investigation.
Claims related to the CDC's calculation of the dumping margin
The Panel upheld several claims raised by Costa Rica concerning aspects of the CDC's determination of the existence of dumping and the calculation of the margin of dumping:
- The first issue concerned the date of sales taken into account for the calculation of the dumping margin: certain sales used by the CDC for the calculation of the export price had been invoiced prior to the start of the period of investigation, while sales used for the calculation of normal value had all been invoiced within the boundaries of the period of investigation. The Panel concluded that this reliance on sales made in periods spanning different timeframes did not comply with the obligation of the second sentence of Article 2.4 of the Anti-Dumping Agreement to make the comparison between the export price and the normal value “in respect of sales made at as nearly as possible the same time”.
- The second issue concerned sales which had been identified by the CDC as sales below costs, which had thus been eliminated from the calculation of the normal value. The Panel considered that an investigating authority is required to use a methodology that allows it to reasonably identify sales that are above cost “at the time of sale” so as not to distort the analysis of whether the transactions are below costs. The Panel found that the CDC had failed to consider the possibility of distortion in its analysis based on the use of the annual weighted average of the investigation period, despite being aware that production costs had increased significantly during the POI, and thus acted inconsistently with the second sentence of Article 2.2.1 of the Anti-Dumping Agreement.
Claims related to the CDC's determination of threat of material injury and the causal link between imports and injury:
The Panel upheld various claims made by Costa Rica under Articles 3.1, 3.2, 3.4, 3.5 and 3.7 of the Anti-Dumping Agreement, in relation to the CDC's determination that imports from Costa Rica were causing a threat of material injury to its domestic industry:
- Regarding the CDC's examination of price effects, the Panel agreed with Costa Rica that the CDC's analysis of price depression was not objective, and thus inconsistent with Articles 3.1 and 3.2 of the Anti-Dumping Agreement, as the CDC did not consider the evolution of prices throughout the 2016-2018 period of investigation, or the fact that the average price calculated at the end of the POI returned to almost the same level as 2015. The Panel, however, disagreed with Costa Rica that the CDC had failed to properly consider whether there had been significant price undercutting or significant price suppression.
- Regarding the CDC's examination of the impact of imports on the domestic industry, the Panel agreed with Costa Rica that the CDC was required to examine the factors and indices mentioned in Article 3.4 of the Antidumping Agreement in order to establish a background against which it can evaluate whether imminent further dumped imports would affect the industry's condition. The Panel analysed each of the elements of Costa Rica's claims, concluding that the CDC's analyses of profitability, cash flow, employment and market share loss were not objective or supported by evidence on record, and additionally found that the CDC's isolated analysis of certain negative domestic industry indicators was incompatible with the requirements of Articles 3.1 and 3.4 of the Anti-Dumping Agreement.
- The Panel upheld Costa Rica's claim that the CDC's analysis of threat of material injury was inconsistent with Articles 3.1 and 3.7 of the Anti-Dumping Agreement. The Panel found that the CDC's analysis of projections on the likelihood of substantially increased dumped imports, and its analysis of whether imports were entering at prices that would have a significant depressing or suppressing effect on domestic prices, were not based on the facts on the record of the investigation, and thus, the CDC's conclusion that alleged dumped imports would cause injury that is “clearly foreseeable and imminent” was unsubstantiated.
- Finally, the Panel upheld Costa Rica's claim under Articles 3.1 and 3.5 of the Anti-Dumping Agreement regarding the CDC's analysis of causation, on the basis that, in totality, the CDC had failed to assess the issue of whether future injury could be caused by the dumped Costa Rican imports.
Claim related to the CDC's decision to initiate the investigation:
Costa Rica also contested, under Article 5.3 of the Anti-Dumping Agreement, the sufficiency of certain evidence provided to the investigating authority by the petitioner. Costa Rica argued in particular that the sales invoices provided by the complainant as evidence of price referred to only one type of corrugated steel rod, concerned a very low volume, and were issued very close succession, almost a year before the filing of the initiation application. The Panel disagreed with Costa Rica that the invoices presented as evidence of normal value were not “sufficient” evidence within the meaning of Article 5.3 of the Anti-Dumping Agreement.
Other procedural claims raised by Costa Rica:
Costa Rica made several additional claims regarding the conduct of the investigation by the investigating authority:
- The Panel agreed with Costa Rica that the CDC had failed to provide the “complete” text of the petition for initiation “as soon” as the investigation was initiated, inconsistently with Article 6.1.3 of the Anti-Dumping Agreement. The CDC had provided interested parties the complete initiation petition and accompanying documents almost four months after initiation.
- The Panel rejected Costa Rica's claims under Article 6.4 of the Anti-Dumping Agreement that the CDC did not provide the interested parties due opportunity to examine relevant information obtained from the petitioner during verification. The Panel rejected Costa Rica's argument that the information in question was erroneously treated as confidential, and thus concluded that the investigating authority was not required to provide interested parties the opportunity in a timely manner to examine the information.
- The Panel also rejected Costa Rica's claim under Article 6.5 of the Anti-Dumping Agreement that the CDC did not provide sufficient justification for granting confidential treatment to certain information provided by the domestic industry. The Panel found that the CDC had in fact required the applicant to justify the confidential nature of the information and had objectively considered the nature of the information and the harm that could result from the disclosure of the information.
- The Panel found no basis for Costa Rica's claim that the CDC acted inconsistently with Article 6.7 and Annex I of the Anti-Dumping Agreement, by failing to indicate to the exporter prior to verification that it should provide information on domestic sales that were made prior to the period of investigation of dumping. The Panel found that verification visits are not the only means or moment in which an investigating authority can verify the accuracy of the information submitted by interested parties or request them to submit additional information, that thus, the CDC did not have an obligation to indicate to the exporter that it should submit additional information.
The Panel's recommendation and suggestion
The Panel recommended that the Dominican Republic bring its measures into conformity with its obligations under the Anti-Dumping Agreement.
On 18 September 2023, the Dominican Republic notified the DSB of its decision to appeal to the Appellate Body certain issues of law and legal interpretations in the panel report. The Dominican Republic indicated that given that the Appellate Body was temporarily unable to function, and in the interests of fairness and orderly procedure in the conduct of the appeal, the Dominican Republic would await instructions regarding any further steps to be taken in this appeal.
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