|
Summary of key findings
1. This dispute concerned measures imposing countervailing and antidumping duties on grain oriented flat rolled electrical steel (“GOES”) from the U.S. The measures were imposed by China's Ministry of Commerce (“MOFCOM”) and the U.S. claimed that they were inconsistent with China's commitments and obligations under the Antidumping Agreement, the SCM Agreement and the GATT 1994.
The U.S.' claims with respect to initiation of certain countervailing duty investigations
2. The U.S. claimed that China acted inconsistently with Articles 11.2 and 11.3 of the SCM Agreement because MOFCOM initiated countervailing duty investigations into 11 programs without sufficient evidence to justify this. The Panel concluded that the obligation upon Members in relation to the sufficiency of evidence in a countervailing duty investigation finds expression in Article 11.3 of the SCM Agreement, which provides that an investigating authority must assess the accuracy and adequacy of the evidence in an application to determine whether it is sufficient to justify initiation. The Panel reached its conclusions by reference to the requirements for “sufficient evidence” set forth in Article 11.2, but did not consider it necessary to reach separate conclusions under this provision. With respect to each of the 11 programs at issue, the Panel concluded that China had acted inconsistently with Article 11.3 of the SCM Agreement.
The U.S.' claims with respect to the non-confidential summaries
3. The applicants for initiation sought and obtained from MOFCOM confidential treatment in relation to a number of categories of information. The U.S. claimed that MOFCOM acted inconsistently with Articles 12.4.1 of the SCM Agreement and 6.5.1 of the Antidumping Agreement by failing to require the applicants to submit adequate non-confidential summaries of the information. The Panel upheld the U.S.' claim. The Panel concluded that the purported summaries did not provide a reasonable understanding of the substance of the information submitted in confidence.
The U.S.' claim with respect to public notice of the calculations used to determine the dumping margins
4. The U.S. claimed that MOFCOM did not disclose the data and calculations it used to arrive at the dumping margins for the two respondent companies and that this was inconsistent with Article 12.2.2 of the Antidumping Agreement. The Panel rejected the U.S.' claim. The Panel could not find within the text of Article 12.2.2 an obligation to include in the relevant public notice or separate report the confidential data and calculations underlying a dumping margin.
The U.S.' claim with respect to public notice of the findings and conclusions leading to MOFCOM's benefit determination under the government procurement statutes
5. The U.S. claimed that MOFCOM did not adequately explain, in either the preliminary or final determinations, why the exclusion of foreign producers from the competitive bidding process under the U.S. Government procurement statutes led to the conclusion that the resulting prices were not market prices for the purposes of the benefit determination. According to the U.S., this was inconsistent with Article 22.3 of the SCM Agreement. The Panel rejected the U.S.' claim. The Panel held that Article 22.3 does not discipline the substantive adequacy of an investigating authority's reasoning. In the Panel's view, MOFCOM included in its public notice the findings and conclusions on matters of law that it considered material, and also referred to the material facts it was relying upon to reach those conclusions.
The U.S.' claims with respect to the use of facts available
6. The U.S. brought a number of claims regarding MOFCOM's resort to facts available in calculating certain dumping and subsidy rates. Although the Panel rejected the U.S.' claim that MOFCOM improperly resorted to facts available to calculate the subsidy rates for the two known respondent exporters, the Panel concluded that the manner in which MOFCOM applied facts available was inconsistent with Article 12.7 SCM Agreement.
7. The Panel upheld the U.S.' claim that China had acted inconsistently with Article 6.8 and paragraph 1 of Annex II of the Antidumping Agreement and Article 12.7 of the SCM Agreement because MOFCOM improperly resorted to facts available in calculating the dumping and subsidy rates for exporters that were unknown to it.
8. The U.S. also brought claims under Articles 6.9, 12.2 and 12.2.2 of the Antidumping Agreement and Articles 12.8, 22.3 and 22.5 of the SCM Agreement, arguing that China did not disclose the essential facts, or provide in sufficient detail in its final determination the findings and conclusions leading to the application of facts available to “unknown” U.S. exporters. The Panel upheld the U.S.' claims in this regard.
The U.S.' claims with respect to MOFCOM's price effects analysis
9. The U.S. challenged MOFCOM's finding that the dumped and subsidized imports had significant price effects. The U.S. contended that MOFCOM's analysis of these price effects was conclusory, failed to reflect an objective examination of the evidence, and was not based on positive evidence. The Panel upheld the U.S.' claims, finding that China had acted inconsistently with Articles 3.1 and 3.2 of the Antidumping Agreement, and Articles 15.1 and 15.2 of the SCM Agreement.
10. The U.S. also claimed that China did not disclose the essential facts supporting its price effects analysis and did not offer an adequate explanation for its price effects findings, in violation of Articles 6.9 and 12.2.2 of the Antidumping Agreement and 12.8 and 22.5 of the SCM Agreement. The Panel also upheld these claims.
The U.S.' claims with respect to MOFCOM's causation analysis
11. The U.S. claimed that MOFCOM's causation analysis was inconsistent with Articles 3.5 of the Antidumping Agreement and 15.5 of the SCM Agreement, on the basis that MOFCOM erroneously concluded that the rapid increase in the capacity of the domestic GOES industry during the period of investigation could not have been a cause of injury to the domestic industry. The U.S. also claimed that MOFCOM's analysis was inconsistent with Articles 3.1 of the Antidumping Agreement and 15.1 of the SCM Agreement because it did not comply with the “objective examination” and “positive evidence” requirements embodied in those provisions. The Panel upheld the U.S.' claims.
12. The U.S. also claimed that China acted inconsistently with Articles 6.9 and 12.2.2 of the Antidumping Agreement and 12.8 and 22.5 of the SCM Agreement, on the basis that China failed to disclose the essential facts supporting its analysis and did not provide an adequate explanation for its causation findings. The Panel upheld these claims.
|