Abstract
Article 3 of the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (“ADA”) and Article 15 of the Agreement on Subsidies and Countervailing Measures (“ASCM”) address the injury determination that an importing country must make before imposing antidumping or countervailing duty measures, while Articles 4.1(ii) of theADAand 16.2 of the ASCM deal with the special situation of injury to regional industries. The language in the two Agreements is virtually identical. It is therefore convenient to consider injury issues under both Agreements in the same chapter, since Panel and Appellate Body decisions interpreting the provisions in one Agreement obviously have direct relevance to the other. In addition, much of the language is similar or identical to the injury provisions in the WTO Agreement on Safeguards.1 Moreover, some of the language in Article 3 of the ADA and Article 15 of the ASCM reflect, with changes, the language concerning injury found in the 1979 Antidumping and Subsidies Codes. Panel and Appellate Body decisions interpreting the injury requirements in the Safeguards Agreement and the 1979 Codes can therefore provide some guidance in interpreting the ADA and ASCM injury provisions.2
Ms. Clarke and Mr. Horlick are partners at Wilmer Cutler, Pickering, Hale and Dorr, LLP. In addition, Mr. Horlick was the first Chairman of the WTO’s Permanent Group of Experts, established under Art. 25 of the ASCM. The authors wish to express their appreciation for the contributions of Kelly Brooke Snyder, Kevin J. Cuddy, Andrea G. Staebler, and Sean McElduff, without whose assistance this chapter would not exist. The opinions expressed herein are solely those of the authors.
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References
Agreement on Safeguards, Marrakesh Agreement Establishing the World Trade Organization, Annex 1A: Multilateral Agreements on Trade in Goods (1994) (“Safeguards Agreement”).
WTO panel and Appellate Body practice has looked to prior GATT panel reports, especially adopted GATT panel reports, as providing useful secondary information to assist in the interpretation of the WTO Agreement. See, e.g., Report of the WTO Panel, Japan—Taxes on Alcoholic Beverages, WT/DS8, 10, 11/R (1996) at 21–22 (“Japanese Liquor Taxes”).
Report of the GATT Panel, Korea—Antidumping Duties on Imports of Polyacetal Resins from the United States, BISD, 40th Supp. at 205 (1993) (adopted) (“Polyacetal Resin”). The Panel faulted Korea for failing to state explicitly the type of harm experienced by the domestic industry and failing to spell out its analysis of the link between the imports and the harm. Id. at ¶¶ 222–224. Moreover, the Panel noted that a finding of material injury, which presupposed the existence of an industry, was inconsistent with a finding of material retardation of establishment of an industry. Id. at ¶ 222.
Report of the Appellate Body, United States—Definitive Safeguard Measures on Imports of CircularWelded Carbon Quality Line Pipe From Korea, WT/DS202/AB/R (2002) at ¶ 177.
Report of the Appellate Body, United States—Antidumping Measures on Certain Hot-Rolled Steel Products from Japan, WT/DS184/AB/R, (2001) (“Hot-Rolled Steel from Japan Appellate Body Report”).
Id. at page 65, ¶ 192. It should be noted that although that decision dealt with the Antidumping Agreement, the language of Article 3.1 of the Antidumping Agreement is identical to the language of Article 15.1 of the ASCM, substituting the phrase “subsidized imports” for the phrase “dumped imports” in Article 3.1.
The Appellate Body has rejected the use of assumptions instead of positive evidence in other circumstances as well. See Report of the Appellate Body, United States—Imposition of Countervailing Duties on Certain Hot-Rolled Lead and Bismuth Carbon Steel Products Originating in the United Kingdom, WT/DS138/AB/R, (2000) (“Lead Bar Appellate Body Report”) at ¶ 61 (finding that once an administering authority finds a “benefit” based on evidence, it may then adopt a presumption in later proceedings in the same matter (e.g., an administrative review) that the benefit continues. However, if the issue of the benefit is raised in a later proceeding, the authority must review the presumption and base its decision on the positive evidence before it).
Report of the Appellate Body, Thailand-Antidumping Duties on Angles, Shapes, and Sections of Iron or Non-Alloy Steel and H-Beams from Poland, WT/DS122/AB/R (2001) at ¶ 107 (“Thailand—Steel Appellate Body Report”). Challenges to the failure to disclose confidential information should instead be brought under the procedural requirements that mandate publishing notifications and informing interested parties of all “essential facts.” These are found elsewhere in the ADA and the ASCM, i.e., Articles 12 and 6.9 of the ADA and Articles 22 and 12.8 of the ASCM, respectively.
Report of the WTO Panel, United States—Definitive Safeguard Measures on Imports of Wheat Gluten from the European Communities, WT/DS166/R (2000) at ¶ 8.8 (“Wheat Gluten”).
Id.
Id. at ¶¶ 8.85–8.86.
Report of the WTO Panel, Argentina—Safeguard Measures on Imports of Footwear, WT/DS121/R (1999). at ¶ 8.213 (“Footwear”).
Report of the Appellate Body, United States—Safeguard Measures on Imports of Fresh, Chilled or Frozen Lamb Meat from New Zealand and Australia, WT/DS177/AB/R and WT/DS178/AB/R (2001) at ¶ 136 (“Lamb Meat Appellate Body Report”).
Id. at ¶ 132.
Hot-Rolled Steel from Japan Appellate Body Report, supra note 6, at ¶ 193.
Id. at ¶ 154.
Article 17.6 of theADArequires the panel to determinewhether the investigating authority’s establishment of the facts was “proper” and whether its evaluation of the facts was “unbiased and objective”. If so, the evaluation may not be overturned even though the panel might have reached a different conclusion. See G. Horlick and P. Clarke, Standards for Panels Reviewing Anti-Dumping Determinations Under the GATT and WTO in International Trade Law and the Gatt/WTO Dispute Settlement System (Ernst-Ulrich Petersmann ed. 1996) for discussion of the negotiating history of the antidumping standard of review. In Lead Bar the Appellate Body rejected the argument by the United States that the same standard of review should be applied in countervailing duty disputes under the ASCM. See Lead Bar Appellate Body Report, supra note 8, at ¶¶ 51–52. Under Article 11 of the Dispute Settlement Understanding, a panel is to make an objective assessment of the matter before it, “including an objective assessment of the facts of the case and the applicability of and conformity with the relevant covered agreements,” which does not mean that the panel should accept the investigating authorities’ explanation as reasoned or adequate if there is a plausible alternative reaction and the authorities’ explanation appears inadequate in light of the alternative explanation. See Lamb Meat Appellate Body Report, supra note 14, at ¶ 206.
Report of the WTO Panel, Thailand—Antidumping Duties on Angles, Shapes, and Sections of Iron or Non-Alloy Steel and H-Beams from Poland, WT/DS122/R (2001) at ¶ 7.143 (“Thailand—Steel Panel Report”).
See Lead Bar Appellate Body Report, supra, note 8 at ¶¶ 51–52.
Report of the GATT Panel, United States-Imposition of Countervailing Duty on Imports of Fresh and Chilled Atlantic Salmon from Norway, BISD, 41st Supp., Vol. II at ¶ 266-267 (1994) (adopted) (“Salmon CVD”). Note that other portions of this Panel’s decision regarding the requirements of an injury investigation have subsequently been rejected by the Appellate Body in the Hot-Rolled Steel from Japan Appellate Body Report, but the analysis discussed here has not been rejected.
Report of the GATT Panel, Brazil—Imposition of Provisional and Definitive Countervailing Duties on Milk Powder and Certain Types of Milk from the European Economic Community, BISD, 41st Supp. 467 SCM/179 (1994) (“Milk Powder”).
Id. at ¶¶ 319–321.
Id. at ¶ 319.
Thailand—Steel Panel Report, supra note 19, at ¶¶ 7.161–7.162.
Salmon CVD, supra note 21, at ¶ 272.
Id.
Report of the GATT Panel, Canadian Countervailing Duties on Grain Corn from the United States, SCM/140 at ¶¶ 5.2.4–5.2.5 (1992) (unadopted) (“Grain Corn”).
Id. at ¶ 5.2.3.
Id. at ¶ 5.2.4.
Footwear, supra note 13, at ¶¶ 8.156–8.157.
Id.
Id. at ¶ 8.159.
In Grain Corn, the GATT Panel faulted Canada for looking at the impact on Canadian prices of the decline in the world price, rather than of imports from the United States, even though the decline in the world price was due to U.S. subsidization. Grain Corn, supra note 28, at ¶ 5.2.6.
Thailand-Steel Appellate Body Report, supra note 9, at ¶¶ 7.161–7.162.
Report of the Appellate Body, Argentina—Safeguard Measures on Imports of Footwear, WT/DS121/AB/R (2000) at ¶ 139 (“Footwear Appellate Body Report”); Lamb Meat Appellate Body Report, supra note 14, at ¶ 144 n. 99.
Lamb Meat Appellate Body Report, supra note 14, at ¶ 144 n. 99.
This issue of “cumulation” across countries in countervailing duty investigations, and its extension of crosscumulation of impact with dumping investigations and across countries has been a contentious issue. As noted in the Checklist, subsidies (other than export and import-substitution subsidies) are not condemned and the disciplines are intended to ensure that countries use subsidies in a responsible manner and in away that avoids harming the interests of other countries. Such subsidies should not be subject to mandatory countermeasures by aggregating the impact of several countries’ actions, each of which individually may be non-distortive. It “‘impedes countries’ efforts to apply subsidies in a responsible manner, and deprives all countries equally of the protection against counter-measures.” See Negotiating Group on Subsidies and Countervailing Measures: Checklist of Issues for Negotiations, Note by the Secretariat, Doc. No. MTN.GNG/NG10/W/9, at III.3.4 (September 7, 1987) (“Checklist”).
See Report of the WTO Panel, United States—Investigation of the International Trade Commission in Softwood Lumber from Canada, WT/DS277/R (2004) at ¶¶ 7.145–7.147 (noting that Canada explicitly did not claim that cross-cumulation of dumped and subsidized imports was per se a violation, and that any other claim of violation in this area was unclear, therefore finding that Canada had not made a prima facie showing of a violation) (“Softwood Lumber ITC”).
Report of the WTO Panel, United States—Antidumping Duty on Dynamic Random Access Memory Semiconductors (DRAMS) of One Megabit or Above From Korea, WT/DS99/R (1999) at ¶¶ 6.87–6.91 (“Korean DRAMS”).
Id. at 150. Interestingly, the United States, which argued for the Panel’s determination in the Korean dispute, maintains that the cumulation provision applies to five-year reviews despite the fact that both ADA, Art. 5.8 (de minimis) and ADA, Art. 3.3 (cumulation) both refer to investigations. Compare ADA Art. 5.8, with ADA, Art. 3.3.
See Report of the Appellate Body, United States—Countervailing Duties on Certain Corrosion Resistant Carbon Steel Flat Products From Germany, WT/DS213/AB/R (2002) (“Corrosion Resistant Steel Appellate Body Report”). It should be noted that there are different types of reviews of antidumping or countervailing duty orders. In the United States, for example, which uses a retroactive method of duty assessment (see Chapter 11 of this book) the most common is the annual review of the level of dumping or subsidization conducted upon request on entries during the preceding year in order to ensure that the amount of duty collected is not in excess of the level of dumping or subsidization, as required by ADA, Art. 9.3 and ASCM, Art. 19.4 (note that ADA Art. 9.3 provides explicit guidance on reviews in the case of retroactive assessment of duties, whereas ASCM, Art. 19.4 does not). Such reviews do not consider the question of injury. In addition, in certain circumstances the United States will conduct a “changed circumstance” review to determine whether or not there has been a sufficient change in circumstances such that continuation of the order is no longer necessary or appropriate, as provided for in ADA, Art. 11.2 and ASCM, Art. 21.2. Such reviews may be either of injury or of the level of dumping/subsidization. Finally, the United States conducts a review every five years, as required by ADA, Art. 11.3 and ASCM, Art. 21.3, to determine whether injury and dumping or subsidization is likely to continue or recur if the order is revoked. The Korean dispute involved the first type of review, to determine the level of dumping during a specific period of time. The Corrosion Resistant Steel dispute involved the last type, a five-year review to determine whether injurious subsidization was likely to continue or review if the order were removed.
See Report of the WTO Panel, United States—Countervailing Duties on Certain Corrosion Resistant Carbon Steel Flat Products From Germany, WT/DS213/R, at ¶ 8.80, overturned on appeal.
Corrosion Resistant Steel Appellate Body Report, supra note 47, at ¶ 93.
Thailand—Steel Panel Report, supra note 19, at ¶ 7.224; Thailand—Steel Appellate Body Report, supra note 9, at ¶ 125; Report of the WTO Panel, European Communities—Antidumping duties on Imports of Cotton-Type Bed Linen From India, WT/DS141/R (2001), at ¶¶ 6.162–6.163 (“EC Bed Linen”).
Thailand—Steel Panel Report, supra note 19, at ¶ 7.236.
Id. at ¶ 7.241.
Lamb Meat Appellate Body Report, supra note 14, at ¶¶ 156–157.
Id. at ¶ 144.
For a brief summary of the debate surrounding this provision of the 1979 Codes, see Horlick and Clarke, supra G. Horlick and P. Clarke, Standards for Panels Reviewing Anti-Dumping Determinations Under the GATT and WTO in International Trade Law and the Gatt/WTO Dispute Settlement System (Ernst-Ulrich Petersmann ed. 1996) note 18 at 322–324.
In describing the results of the Uruguay Round negotiations, theWTOstated: “The Agreement strengthens the requirement for the importing country to establish a clear causal relationship between dumped imports and injury to the domestic industry.”WTO, A Summary of the Final Act of the Uruguay Round: Agreement on Implementation of Article VI (Anti-Dumping), available at www.wto.org/english/docs_e/htm#fAgreement.
Footwear, supra note 13, at ¶¶ 8.249–8.252.
Report of the Appellate Body, United States—Definitive Safeguard Measures on Imports of Wheat Gluten from the European Communities, WT/DS166/AB/R (2000) at ¶ 55 (“Wheat Gluten Appellate Body Report”).
Grain Corn, supra note 28 at ¶¶ 5.2.9–5.2.10.
Lamb Meat Appellate Body Report, supra note 14, at ¶ 170; Wheat Gluten Appellate Body Report, supra note 60, at ¶ 70.
Lamb Meat Appellate Body Report, supra note 14, at ¶¶ 177–178; Wheat Gluten Appellate Body Report, supra note 60, at ¶ 69.
Id.
Id.
Footwear, supra note 13, at ¶ 8.238; Footwear Appellate Body Report, supra note 36, at ¶ 145.
Footwear, supra note 13, at ¶ 8.238.
Report of the WTO Panel, United States—Antidumping Measures on Certain Hot-Rolled Steel Products from Japan, WT/D5184/R (2001).
Hot Rolled Steel from Japan Appellate Body Report, supra note 6, at ¶ 228 (“... such an assessment must involve separating out and distinguishing the injurious effects of the other factors from the injurious effects of the dumped imports.”)
Report of the WTO Panel, Mexico—Antidumping Investigation of High Fructose Corn Syrup (HFCS) from the United States, WT/DS132/R (2000) at ¶ 7.154 (“HFCS”).
Id. at ¶¶ 7.154–7.155.
Id. at ¶ 7.147.
Id. at ¶ 7.157.
Hot-Rolled Steel from Japan Appellate Body Report, supra note 6, at ¶¶ 181–214.
Id. at ¶ 206. Although the discussion was in relation to the objective examination requirement of Antidumping Agreement, Article 3.1, it reinforces the analysis of the HFCS panel report.
HFCS, supra note 71, at ¶ 7.177.
Lamb Meat Appellate Body Report, supra note 14, at ¶ 125.
Polyacetal Resin, supra note 3, at ¶ 283.
Softwood Lumber ITC, supra note 42.
Id., at ¶ 7.58 (“... the change in circumstances that would give rise to a situation in which injury would occur encompasses a single event, or a series of events, or developments in the industry, and/or concerning the dumped or subsidized imports, which lead to the conclusion that injury which has not yet occurred can be predicted to occur imminently.”)
Softwood Lumber ITC, supra note 42, at ¶ 7.69. Note in this case, the WTO Panel found that the totality of the circumstances did not support the authorities finding of threat. Id. at ¶ 7.96.
Id. at ¶ 7.67.
HFCS, supra note 71, at ¶¶ 7.126–7.127.
Softwood Lumber ITC, supra note 42, at ¶¶ 7.134–7.137.
Id. at ¶¶ 7.32–7.34.
Id. at ¶ 7.33.
Id. at ¶ 7.34.
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Clarke, P.A., Horlick, G.N. (2005). Injury Determinations in Antidumping and Countervailing Duty Investigations. In: Macrory, P.F.J., Appleton, A.E., Plummer, M.G. (eds) The World Trade Organization: Legal, Economic and Political Analysis. Springer, Boston, MA. https://doi.org/10.1007/0-387-22688-5_17
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