DS585: India — Additional Duties on Certain Products from the United States
The United States submitted its second request for a panel to rule on India’s duties imposed on certain US imports in response to the 2018 US duties imposed on imported steel and aluminium. The first US request was blocked by India at a DSB meeting on 30 September.
The United States said that every sovereign has the right to take action it considers necessary for the protection of its own security and that the US actions are completely justified under Article XXI of the General Agreement on Tariffs and Trade (GATT). What remains inconsistent is the unilateral retaliation against the US by various WTO members, including India, based on the claim that the US duties are a safeguard action. Just as these members appear ready to undermine the dispute settlement system by ignoring the plain meaning of Article XXI and 70 years of practice, so too are they ready to undermine the WTO by pretending to follow its rules while imposing measures that blatantly disregard these rules, the US declared.
India said that it was disappointed the United States has chosen to move forward with its case and reiterated that its actions are consistent with WTO rules. India considers that the US Section 232 measures on steel and aluminium imports are nothing but a disguised safeguard intended to protect the US domestic industry in the garb of national security. India’s rebalancing measures are in direct response to the unwarranted restrictions imposed by the US, India declared.
The DSB agreed to the establishment of the panel. The European Union, Japan, China, Mexico, Canada, Brazil, Guatemala, Ukraine, Turkey, Switzerland, Chinese Taipei, Norway, Venezuela, Russia, Malaysia and Singapore reserved their third party rights to take part in the proceedings.
DS578: Morocco — Definitive Anti-Dumping Measures on School Exercise Books from Tunisia
Tunisia submitted its second request for a panel concerning final anti-dumping duties imposed by Morocco on imports of school exercise books from Tunisia. Tunisia’s first request was blocked at the DSB meeting on 30 September.
Tunisia reiterated its claim that Morocco acted inconsistently with a number of provisions under the WTO’s Anti-Dumping Agreement and the GATT 1994 and that consultations with Morocco held in June failed to overcome differences between the two sides, prompting Tunisia to request the establishment of a panel.
Morocco said it strongly regretted Tunisia’s second request for a panel and that it believed it imposed the anti-dumping duties in accordance with WTO rules. The dispute concerns a technical matter which should not have been brought to the WTO for resolution, Morocco said, adding that it hoped the two sides could continue discussing the matter with the aim of reaching a mutually acceptable solution.
The DSB agreed to the establishment of the panel. The European Union, the United States, Brazil, Canada, China, Russia and Japan reserved their third party rights to take part in the proceedings.
DS437: United States — Countervailing Duty Measures on Certain Products from China
China said it was requesting the right to suspend concessions with respect to the United States as a result of continued US non-compliance with the WTO ruling in DS437. China noted that a compliance ruling was adopted by the DSB on 15 August and that the US did not indicate its intention to implement the ruling at that meeting. China said it understands the United States objects to the level of the proposed suspension outlined in a communication from China and circulated on 18 October, and that the matter is therefore referred to WTO arbitration.
The United States said that it submitted a letter on 25 October objecting to the level of retaliation proposed by China and that, in line with WTO rules, the matter was therefore automatically referred to WTO arbitration.
The DSB took note that the matter has been referred to arbitration as required by Article 22.6 of the WTO’s Dispute Settlement Understanding (DSU).
DS493: Ukraine — Anti-Dumping Measures on Ammonium Nitrate
Ukraine said that it intends to fully implement the WTO’s ruling in DS493 and that it would need a reasonable period to do so, as implementation will require the amendment of Ukraine’s anti-dumping law and a further review of the dumping measure.
Russia thanked Ukraine for its statement and said it looked forward to discussing with Ukraine the appropriate period needed to ensure implementation.
DS504: Korea — Anti-Dumping Duties on Pneumatic Valves from Japan
Korea welcomed the panel and Appellate Body rulings in DS504 which it said mostly upheld Korea’s position. However, Korea also recognizes that there are certain procedural matters and some methodological flaws in the investigating authorities’ price effect analysis that need to be addressed through proper implementation. Korea confirmed its willingness to faithfully implement the ruling within a reasonable period of time and that it would discuss the matter with Japan with a view to reaching agreement on this.
Japan said it welcomed Korea’s statement and urged Korea to take prompt actions to bring its WTO-inconsistent dumping measure into full compliance. Japan said it stands ready to discuss the matter of the reasonable period of time with Korea.
The two sides then exchanged views on what was needed to ensure compliance. Korea said it rejected Japan’s suggestion that the only way to ensure compliance was to withdraw the dumping duties on pneumatic valves from Japan. Japan said Korea is required to rectify the fundamental legal flaws that the Appellate Body identified and that it was difficult to see how Korea could do this simply by rewriting some parts of the injury determination; the only and clearest implementation by Korea is to eliminate immediately the dumping measure, Japan said.
DS234: United States – Continued Dumping and Subsidy Offset Act of 2000
The European Union reiterated its request that the United States cease transferring anti-dumping and countervailing duties to the US domestic industry, arguing that every such disbursement was a clear act of non-compliance with the rulings on this matter. Brazil and Canada supported the EU statement, while the United States said it has taken all actions necessary to implement the ruling.
DS316: European Communities and Certain Member States – Measures affecting Trade in Large Civil Aircraft: Implementations of the recommendations adopted by the DSB
The United States said that once again the European Union has failed to provide a status report to the DSB concerning dispute DS316. The European Union repeated that the matter is subject to new compliance proceedings and thus there was no obligation on the EU to submit a status report.
Statement by the United States concerning Article 6.2 of the DSU
The United States made a statement regarding what it said was the incorrect legal interpretation by the WTO’s Appellate Body of Article 6.2 of the DSU, which states that a request for a WTO dispute panel shall “provide a brief summary of the legal basis of the complaint sufficient to present the problem clearly”. The United States said the Appellate Body adopted an erroneous interpretation of Article 6.2 in past rulings which required a member to explain “how or why” the measure at issue is considered to be violating WTO rules, a requirement that does not appear in the DSU text. This incorrect interpretation has made disputes more complicated by encouraging procedural challenges, resulting in delays in proceedings and creating significant uncertainty for the parties in the dispute.
This is not an abstract issue, the United States said – in the DS504 dispute, the panel found that certain claims of Japan were outside the panel’s terms of reference, relying on the past erroneous Appellate Body interpretations. Even though the Appellate Body appears to have attempted to back away from this approach in DS504, finding that several of Japan’s claims were incorrectly found to be outside the panel’s terms of reference, it has done so in a manner that creates confusion and more uncertainty, without any assurance that the difficulties that have been identified will be alleviated, the United States said. This is yet another instance demonstrating that the panels and the Appellate Body need to follow the text that members have agreed to, the US said, rather than departing from that text and undermining the WTO dispute settlement system.
Several members took the floor to comment. Japan agreed with the US that the “how or why” requirement set by the Appellate Body in earlier rulings has no basis in Article 6.2 and that the clarification provided in the DS504 ruling fully reflected the arguments made by Japan. Canada said a request for a panel must provide at a minimum the specific WTO provisions alleged to have been infringed, although there may be cases where just citing the provisions does not cover the requirements of the DSU; ultimately a judgment must be made on a case by case basis. China said the focus of discussion should instead be on the most urgent matter, resolving the current impasse over the appointment of new Appellate Body members.
Appellate Body appointments
Mexico, speaking on behalf of 116 members, introduced once again the group’s proposal to start the selection processes for six vacancies in the Appellate Body – the four existing vacancies plus the two vacancies that will emerge when the second terms of Ujal Bhatia and Thomas Graham end on 10 December.
Mexico said the increasing number of members submitting the proposal reflects a common concern over the current situation in the Appellate Body that is seriously affecting its workings as well as the workings of the overall dispute settlement system against the best interest of members. WTO members have a responsibility to safeguard and preserve the Appellate Body, the dispute settlement system and the multilateral trading system, Mexico said.
The United States once again responded that it was still not in the position to support the proposal and that the systemic concerns that it previously identified remain unaddressed. For more than 16 years the US has been raising serious concerns with the Appellate Body’s overreaching and disregard for the rules set by WTO members. The US will continue to insist that WTO rules be followed and will continue efforts and discussions to seek a solution, it said.
Nearly 20 members took the floor to comment. Many underlined the importance of resolving the impasse over the appointment of new members as soon as possible and said it was important that all members engage in efforts to break the deadlock. Several welcomed the draft General Council decision put forward on 15 October by the DSB chair, Ambassador David Walker of New Zealand, which seeks to address the concerns raised by the United States regarding the Appellate Body. Two members cited the lack of constructive engagement by the United States and the absence of any clear US demands which would help resolve the crisis.
Ambassador Walker noted that he reported to the General Council on 15 October on his efforts to facilitate a compromise on overcoming the impasse and presented his draft General Council decision on the functioning of the Appellate Body for members’ consideration. The draft decision is based on proposals put forward by members, extensive discussions in the informal consultation process and feedback received since July; it is now up to members to see how to take this matter forward, he said.
Norway told WTO members it has concluded an interim agreement with the European Union intended to address possible appeals in any disputes between the two that may be filed if and after the Appellate Body becomes inoperative in December. Norway said the agreement, circulated to members on 21 October, was a step necessary to maintain a well-functioning dispute settlement system. Norway said the agreement was based on the interim arbitration arrangement under Article 25 of the DSU that the EU and Canada presented to WTO members at the 30 September DSB meeting.
Surveillance of implementation
The US presented status reports with regard to DS184, “US — Anti-Dumping Measures on Certain Hot-Rolled Steel Products from Japan”, DS160, “United States — Section 110(5) of US Copyright Act”, DS464, “United States — Anti-Dumping and Countervailing Measures on Large Residential Washers from Korea”, and DS471,”United States — Certain Methodologies and their Application to Anti-Dumping Proceedings Involving China”.
The European Union presented a status report with regard to DS291, “EC — Measures Affecting the Approval and Marketing of Biotech Products”.
The next regular meeting of the DSB is scheduled for 22 November.
More information on WTO dispute settlement is available here.
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