To examine, in the light of the relevant provisions of the covered agreements cited by Korea in document WT/DS99/2 the matter referred to the DSB by Korea in that document and to make such findings as will assist the DSB in making the recommendations or in giving the rulings provided for in those agreements. (WT/DS/99/3.)
The administering authority may revoke, in whole or in part, a countervailing duty order or an anti-dumping duty order or finding, or terminate a suspended investigation, after review under subsection (a) or (b) of this section. The administering authority shall not revoke, in whole or in part, a countervailing duty order or terminate a suspended investigation on the basis of any export taxes, duties, or other charges levied on the export of the subject merchandise to the United States which are specifically intended to offset the countervailable subsidy received.
The Secretary [of Commerce] may revoke an order in part if the Secretary concludes that:
(i) One or more producers or resellers covered by the order have sold the merchandise at not less than foreign market value for a period of at least three consecutive years;
(ii) It is not likely that those persons will in the future sell the merchandise at less than foreign market value; and
(iii) For producers or resellers that the Secretary previously has determined to have sold the merchandise at less than foreign market value, the producers or resellers agree in writing to their immediate reinstatement in the order, as long as any producer or reseller is subject to the order, if the Secretary concludes under §353.22(f) that the producer or reseller, subsequent to the revocation, sold the merchandise at less than foreign market value.
(a) Korea’s claims under Articles 1, 2, 3 and 17 of the AD Agreement are inadmissible (with the exception of claims under Articles 2.1, 2.2, 126.96.36.199, and 3.1) ;
(b) Korea’s claims concerning the 1993 final determinations by the DOC and the ITC on DRAMs from Korea are inadmissible;
(c) The DOC’s Final Results Third Review is not inconsistent with Article 11 of the AD Agreement or any other provision of the AD Agreement or GATT 1994;
(d) The United States anti-dumping statute and regulations are not inconsistent with Article 11 of the AD Agreement or any other provision of the AD Agreement or GATT 1994;
(e) The above measures do not nullify or impair benefits accruing to Korea under the AD Agreement or GATT 1994.
A panel’s terms of reference are important for two reasons. First, terms of reference fulfil an important due process objective – they give the parties and third parties sufficient information concerning the claims at issue in the dispute in order to allow them an opportunity to respond to the complainant’s case. Second, they establish the jurisdiction of the panel by defining the precise claims at issue in the dispute.13
Subject to subparagraphs 3.1 and 3.2, the provisions of this Agreement shall apply to investigations, and reviews of existing measures, initiated pursuant to applications which have been made on or after the date of entry into force for a Member of the WTO Agreement.
The Appellate Body sees Article 32.3 of the SCM Agreement as a clear statement that for countervailing duty investigations or reviews, the dividing line between the application of the GATT 1947 system of agreements and the WTO Agreement is to be determined by the date on which the application was made for the countervailing duty investigation or review. Article 32.3 has limited application only in specific circumstances where a countervailing duty proceeding, either an investigation or a review, was underway at the time of entry into force of the WTO Agreement. This does not mean that the WTO Agreement does not apply as of 1 January 1995 to all other acts, facts and situations which come within the provisions of the SCM Agreement and Article VI of the GATT 1994. However, the Uruguay Round negotiators expressed an explicit intention to draw the line of application of the new WTO Agreement to countervailing duty investigations and reviews at a different point in time from that for other general measures. Because a countervailing duty is imposed only as a result of a sequence of acts, a line had to be drawn, and drawn sharply, to avoid uncertainty, unpredictability and unfairness concerning the rights of states and private parties under the domestic laws in force when the WTO Agreement came into effect.21
Unless a different intention appears from the treaty or is otherwise established, its provisions do not bind a party in relation to any act or fact which took place or any situation which ceased to exist before the date of the entry into force of the treaty with respect to that party. (Emphasis added by Korea.)
The Panel... should [not] substitute its own judgment for that of the KTC as to the relative weight to be accorded to the facts before the KTC. To do so would ignore that the task of the Panel was not to make its own independent evaluation of the facts before the KTC to determine whether there was material injury to the industry in Korea but to review the determination as made by the KTC for consistency with the Agreement, bearing in mind that in a given case reasonable minds could differ as to the significance to be attached to certain facts.25
in its assessment of the facts of the matter, the panel shall determine whether the authorities’ establishment of the facts was proper and whether their evaluation of those facts was unbiased and objective. If the establishment of the facts was proper and the evaluation was unbiased and objective, even though the panel might have reached a different conclusion, the evaluation shall not be overturned....26
the panel shall interpret the relevant provisions of the Agreement in accordance with customary rules of interpretation of public international law. Where the panel finds that a relevant provision of the Agreement admits of more than one permissible interpretation, the panel shall find the authorities’ measure to be in conformity with the Agreement if it rests upon one of those permissible interpretations.27
First: "determine whether the authorities’ establishment of the facts was proper"
This means that the Panel should determine whether the authorities followed procedures for collecting, evaluating, and processing facts during their investigation which were consistent with the requirements of the AD Agreement.
Second: determine whether the authorities’ "evaluation of those facts was unbiased and objective"
This provision means that the Panel must evaluate whether (a) the authorities examined all of the relevant facts before it, including facts which might detract from an affirmative determination, (b) whether adequate explanation has been provided of how the determinations made by the authorities are supported by facts in the record, and (c) whether the authorities based their determinations on an examination of factors required by the AD Agreement.
in its assessment of the facts of the matter, the panel shall determine whether the authorities’ establishment of the facts was proper and whether their evaluation of those facts was unbiased and objective. If the establishment of the facts was proper and the evaluation was unbiased and objective, even though the panel might have reached a different conclusion, the evaluation shall not be overturned.
[W]e are to examine whether the evidence relied on by the Ministry was sufficient, that is, whether an unbiased and objective investigating authority evaluating that evidence could properly have determined that sufficient evidence of dumping, injury, and causal link existed to justify initiating the investigation.30
[T]he panel shall interpret the relevant provisions of the Agreement in accordance with customary rules of interpretation of public international law. Where the panel finds that a relevant provision of the Agreement admits of more than one permissible interpretation, the panel shall find the authorities’ measure to be in conformity with the Agreement if it rests upon one of those permissible interpretations.
Countries party to an anti-dumping dispute are not delegates whose technical expertise specially qualifies them to make authoritative interpretive decisions. They are, rather, interested parties whose own (national) interests may not always sustain a necessary fidelity to the terms of international agreements.33
Whereas in the US administrative law setting there is typically little danger of multiple interpretations of the statutory language by several different agencies, in the GATT/WTO setting multiple interpretations of agreement provisions is precisely one of the problems that panel review is designed to ameliorate.34
[W]e find it difficult, indeed, to see how any system of judicial settlement could work if it incorporated the proposition that the mere assertion of a claim might amount to proof. It is, thus, hardly surprising that various international tribunals, including the International Court of Justice, have generally and consistently accepted and applied the rule that the party who asserts a fact, whether the claimant or the Respondent, is responsible for providing proof thereof. Also, it is a generally-accepted canon of evidence in civil law, common law and, in fact, most jurisdictions, that the burden of proof rests upon the party, whether complaining or defending, who asserts the affirmative of a particular claim or defence.35
The general rule in a dispute settlement proceeding requiring a complaining party to establish a prima facie case of inconsistency with a provision of the SPS Agreement before the burden of showing consistency with that provision is taken on by the defending party, is not avoided by simply describing that same provision as an "exception". In much the same way, merely characterizing a treaty provision as an "exception" does not by itself justify a "stricter" or "narrower" interpretation of that provision than would be warranted by examination of the ordinary meaning of the actual treaty words, viewed in context and in the light of the treaty's object and purpose, or, in other words, by applying the normal rules of treaty interpretation.37
D. Claims under Article 11 of the AD Agreement and Article VI of GATT 1994
No contracting party shall levy any anti-dumping... duty on the importation of any product of the territory of another contracting party unless it determines that the effect of the dumping... is such as to cause or threaten material injury to an established domestic industry, or is such as to retard materially the establishment of a domestic industry.
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, uponrequest by any interested party which submits positive information substantiating the need for a review. 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. (Emphasis added by Korea.)
The investigating authorities shall review the need for the continued imposition of the duty, where warranted, on their own initiative or if any interested party so requests and submits positive information substantiating the need for review.57
The silence of Article 9:1 regarding the means by which a Party was to determine when an anti-dumping duty was no longer necessary within the meaning of that provision, together with the mandatory review procedure specifically provided for in Article 9:2, the purpose of which could only be understood in light of the requirement embodied in Article 9:1, contradicted the view that Article 9:1 by itself obliged Parties to take specific procedural steps to satisfy themselves as to the continued need for the imposition of an anti-dumping duty distinct from those required under Article 9:2.60
In evaluating the "not likely" issue in numerous cases, Commerce has considered three years of no dumping margins, plus a Respondent’s certification that it will not dump in the future, plus its agreeing to immediate reinstatement in the order all to be indicative of expected future behavior. In such instances, this was the only information contained in the record regarding the likelihood issue...
In other cases, when additional evidence is on the record concerning the likelihood of future dumping, Commerce is, of course, obligated to consider that evidence. In this regard, in evaluating such record evidence to determine whether future dumping is not likely, the DOC has a longstanding practice of examining all relevant economic factors and other information on the record in a particular case.78
While the first two paragraphs [of Article 11] do discuss the "need" for an order and whether an order is "necessary" or "warranted," these words are never defined and dictionary definitions are not instructive.79
This amounts to avoidance of interpretation. As they appear in Paragraphs 1 and 2, "need," "necessary" and "warranted" are not terms requiring dictionary interpretation in the first place.
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..., unless the authorities determine, in a review initiated before that date..., that the expiry of the duty would be likely to lead to continuation or recurrence of dumping and injury.22/
22/ When the amount of the anti-dumping duty is assessed on a retrospective basis [as in the US system], 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.
223. The panel noted that under Article 9:1 "An anti-dumping duty shall remain in force only as long as, and to the extent necessary to counteract dumping which is causing injury." Accordingly, Article 9:1 obliged Parties to the Agreement not to maintain anti-dumping duties when such duties were no longer necessary to counteract dumping which was causing injury. However, the text of Article 9:1 did not provide an expressobligation regarding the steps to be taken by Parties to the Agreement in order to make a determination on whether the continued imposition of an anti-dumping duty was necessary to counteract dumping which was causing injury.
224. In contrast, Article 9:2 provided for a specific obligation to "review" the need for the continued imposition of the duty, on the initiative of investigating authorities, or upon a duly substantiated request by any interested party. In the Panel’s view, the purpose of the review procedure under Article 9:2 could only be understood if Article 9:2 was read in the light of Article 9:1. The references in Article 9:2 to "the need for the continued imposition of the duty" and "the need for review" could only be interpreted in a meaningful manner when read in conjunction with the obligationin Article 9:1. Thus, a review under Article 9:2 of "the need for the continued imposition of the duty" was a review of whether that duty continued to be "necessary to counteract dumping which is causing injury". Similarly, "positive information substantiating the need for review" in Article 9:2 necessarily meant information relevant to the issue of whether the anti-dumping duty remained "necessary to counteract dumping which is causing injury."
225. The Panel thus read Article 9:1 as requiring Parties not to maintain anti-dumping duties longer than necessary to counteract dumping which was causing injury, and Article 9:2 as setting forth an obligation of Parties regarding the undertaking of a factual examination of whether the continued imposition of anti-dumping duties was necessary within the meaning of Article 9:1.87
[T]he Panel recalled that panels had consistently ruled that legislation which mandated action inconsistent with the General Agreement could be challenged as such, whereas legislation which merely gave the discretion to the executive authority of a contracting party to act inconsistently with the General Agreement could not be challenged as such; only the actual application of such legislation inconsistent with the General Agreement could be subject to challenge.90
The US revocation scheme mandates action inconsistent with the WTO AD Agreement and so it can be challenged as such.
DOC’s Position: The applicable statutes and regulations grant the DOC broad discretion in determining whether to revoke an anti-dumping finding. The only relevant statutory provision states: "The administering authority may revoke, in whole or in part, a countervailing duty order or an anti-dumping duty order * * * after a review under this section." 19 U.S.C. section 1675(c) (emphasis supplied). Therefore, except for the requirement for conducting an administrative review, Congress has not specified any procedure that the DOC must follow or any criteria that it must consider in determining whether to revoke a particular anti-dumping duty order. The applicable Commerce regulation, contained in 19 CFR 353.25, preserves the broad discretion granted by Congress, by providing in pertinent part: "[T]he Secretary may revoke an order or terminate a suspended investigation if the Secretary concludes that * * *" In short, the regulation like the governing statute, vests a great deal of discretion in the Secretary to determine the propriety of revocation.99
· "The language of the regulations indicates that the Secretary is not compelled to grant revocation even when plaintiffs satisfy the requirements for revocation";100
· "The regulation does not present objective criterion for determining whether there is "no likelihood" of resumption of LTFV sales. Instead, the petitioner [the Respondent before the DOC] must establish this fact to the satisfaction of the Secretary";101
· "[The regulation] vests a great deal of discretion in the Secretary to determine the propriety of revocation...."
"[T]he language employed indicates that Commerce is not compelled to grant revocation, as the above noted sections refer to what the Secretary may do when acting on an application for revocation...."
"[E]ven if the administrative reviews reveal that plaintiffs have not been dumping for the periods in question, Commerce may exercise its discretion not to grant revocation";102 and
· "[E]ven assuming the plaintiffs had, as they claim, satisfied all of the requirements for revocation contained in [the regulation], the ITA was not required to grant their request."103
(1) United States Law to Prevail in Conflict.—No provisions of any of the Uruguay Round Agreements, nor the application of any such provision to any person or circumstance, that is inconsistent with any law of the United States shall have effect.
1. three consecutive years of no or de minimis margins104;
2. a showing that dumping is "not likely" to recur (or, that there is "no likelihood" that dumping will recur) ;
3. a written agreement that the duty/order will be reinstated if dumping does recur.105
The key requirement here is the second--the "no likelihood/not likely" requirement--because the DOC found that Respondents met the first and third requirements, but not the second requirement.
The regulation does not present an objective criterion for determining whether there is "no likelihood" of resumption of LTFV sales. Instead, the petitioner [the Respondent company seeking revocation] must establish this fact to the satisfaction of the Secretary.107
Thus, the Secretary makes the determination as to whether the Respondent has met the second requirement and, conducts the analysis without consistent reference to transparent and established standards.108
... The administering authority may revoke, in whole or in part, a countervailing duty order or an anti-dumping duty order... after [an administrative] review...112
The Secretary of Commerce (Secretary) has been entrusted with responsibility for implementing the anti-dumping law. The Secretary has broad discretion in executing the law. While the law does not expressly limit the exercise of that discretion with precise standards or guidelines, some general standards are apparent and these must be followed. The Secretary cannot, under the mantle of discretion, violate these standards or interpret them out of existence.126
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.
First, this sentence provides rights to interested parties, thus imposing requirements on Members. Second, it limits Members’ discretion as to the type of analysis they can conduct. Although the sentence allows Members to conduct a forward-looking analysis of whether injury would be likely to continue or recur,129 it does not call for or allow a prospective analysis of whether dumping "would be likely to continue or recur." As revealed in the plain language of the sentence, the negotiators did not extend the "likely to" concept to the dumping context and doing so by implication is impermissible. Rather, regarding dumping, the Member is permitted only to examine "whether the continued imposition of the duty is necessary to offset dumping."130 Where, as here, no dumping has occurred for three consecutive years, the duty is not "necessary to offset dumping" because there is no dumping (much less injury).
Common sense, however, dictates that the DOC should, as always, base its determination on all record evidence.
In this revocation proceeding the DOC considered all publicly available data and information placed on the record by all parties...133
The agency must also be satisfied that a resumption of less-than-normal-value sales to the United States by the Respondent is not likely.
The use of the word "satisfied" indicates that the burden of proof is on the Respondent, and not on the agency or the petitioner.159 Later, at paragraph 77, the United States actually agrees with Korea that "US courts have held that the burden is on the party seeking revocation to come forward with ‘real evidence’ to persuade the DOC to revoke the order."
Finally, we do not discern that the ITC imposed a "burden of proof" on the Japanese importers to prove no injury was likely to occur. The ITC's decision does not depend on the "weight" of the evidence, but rather on the expert judgment of the ITC based on the evidence of record. On review, the question is whether there was evidence which could reasonably lead to the ITC's conclusion, that is, does the administrative record contain substantial evidence to support it and was it a rational decision?166
In his separate views, Judge Nichols elaborated on this point:
The CIT judge said this lament reflected an impermissible throwing of the burden of proof on the proponents of lifting the order. I do not agree. There is a subtle but recognizable difference between the burden of proof and the burden of going forward. This investigation was conducted at all because these attorneys had requested on behalf of their clients that it should be. If they did not intend to waste [ITC] resources, it would be reasonable to think they would be in possession of information which, if believed and not controverted, would constitute a prima facie case...167
the issue before the Department is not what may or may not have happened last year. It is what is likely to happen in the future if the order is revoked. In order to make a reasonable prediction of the future, the Department's decision must be based on the most recent information available182.
The authorities shall review the need for the continued imposition of the duty, where warranted, on their own initiative....204
According to the third sentence of Paragraph 2:
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.