DATA of Intl Trade Law Report

7/24/2019 DATA of Intl Trade Law Report

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DISPUTE SETTLEMENT: DISPUTE DS313

European Communities Anti-Dumping Duties onCertain Flat Rolle Iron or Non-Allo! Steel Prou"ts#rom Inia

This summaryhas been

prepared bythe Secretariat

under its ownresponsibility.

The summary isfor general

informationonly and is not

intended to

affect therights and

obligations ofembers.

See also:!The basics"how disputesare settled in

#T$! %omputer

based trainingon dispute

settlement! Te&t of theDispute

SettlementUnderstanding

$t%er isputesin&ol&ing:

! Steel!India

! EuropeanUnion

'formerly E%(! )greement

onImplementatio

n of )rticle *Iof the +eneral)greement on

Tariffs andTrade 1,,-

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Settle or terminate'(it%ra(n) mutuall!agree solution*on++ $"to,er +.

/e! #a"ts bac to top

Shorttitle"

%omplainant"

India

/espondent" European

%ommunities

ThirdParties"

)greementscited"'as citedinre0uest

forconsultations(

)ntidumping')rticle*I of+)TT

1,,-(")rt. 3.-23.2 -.12,.4

/e0uest for%onsul

5uly 46

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tationsrecei7ed"

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49 $ctober 466-

Summar! o# t%eispute to atebac to top

The summary belowwas uptodate at4- :ebruary 4616

Consultations

%omplaint by India.

$n 5uly 466-2 Indiare0uestedconsultations with theEuropean %ommunitiesconcerning the

imposition of definiti7eantidumping measureson imports of certainflat rolled products ofiron or nonalloy steel2of a width of ;66 mmor more2 not clad2plated or coated2 incoils2 not furtherwored than hotrolled'( fromIndia.

)ccording to the Indianre0uest2 the E%7iolates )rticle ,.4 ofthe )ntiDumping)greement2 whichre0uires that an antidumping duty shall becollected on a nondiscriminatory basis on
http://www.wto.org/english/tratop_e/dispu_e/cases_e/ds313_e.htm#tophttp://www.wto.org/english/tratop_e/dispu_e/cases_e/ds313_e.htm#top


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imports of the productfrom all sources foundto be dumped andcausing in?ury. Indiaclaims that2 while

antidumping measuresare in force againstimports into the%ommunity of =/ %oilsfrom India2 nomeasures are in forceagainst imports of thesame productconcerned from Egypt2Slo7aia and Turey2notwithstanding thatthe products importedfrom the latter three

countries were alsofound by the%ommission to bedumped and causingin?ury to the%ommunity industry.

India also considersthat the antidumpingmeasures concerned7iolate certain otherpro7ision of the )ntiDumping )greement2

including2 but notlimited to thefollowing" )rticle 32especially )rticles 3.-and 3.@ and )rticle-.1.

1it%ra(al2termination

$n 44 $ctober 466-2India and the European%ommunities notifiedthe DSA that they hadreached an agreementwith respect to thematter raised by Indiain its re0uest forconsultations.)ccording to the


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notification2 theEuropean %ommunitiesagreed to terminatethe measure at issue.

"onta"t us" #orld Trade $rganiBation2 rue de Causanne 1-2 %=1411 +ene7a 412 SwitBerland

Anti-dumping

Anti-dumping measures counter dumping practices occurring when non-EU manufacturers sell

their goods in the EU below the normal value (usually the sales price) on their domestic market

What is dumping?

A company is dumping if it is exporting a product to the EU at prices lower than the normal

value of the product (the domestic prices of the product or the cost of production) on its own

domestic market.

he European !ommission is responsible for investigating allegations of dumping by exporting

producers in non-EU countries. "t usually opens an investigation after receiving a complaint from

the !ommunity producers of the product concerned# but it can also do so on its own initiative.

What is an anti-dumping proceeding?

After receiving a complaintfrom the !ommunity producers of the product concerned# the

!ommission publishes a notice in the EU$s %fficial &ournal opening an anti-dumping

proceeding.
http://www.wto.org/english/info_e/cont_e.htmhttp://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/complaints/http://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/complaints/http://eur-lex.europa.eu/JOIndex.dohttp://www.wto.org/english/info_e/cont_e.htmhttp://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/complaints/http://eur-lex.europa.eu/JOIndex.do


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he maximum time limit for an investigation under these proceedingsis ' months.

he detailed findings are published in the %fficial &ournal# for example# as a regulation imposing

anti-dumping duties or terminating the proceeding without duties being imposed.

Flowchart of the anti-dumping investigation process

Under what circumstances can anti-dumping measures be imposed?

or detailed information on conditions for imposing an anti-dumping measure# see !onditions

he investigation must show that*

1. there is dumping by the exporting producers in the countrycountriesconcerned

!. material in"ury has been su#ered by the $ommunity industry concerned

%. there is a causal lin& between the dumping and in"ury found

'. the imposition of measures is not against the $ommunity interest.

What is an anti-dumping duty?

"f the investigation finds that the above four conditions have been met# then anti-dumping

measures can be imposed on imports of the product concerned. hese measures usually take the

form of an ad valorem duty# but could also bespecific dutiesorprice undertakings. he duties

are paid by the importer in the EU and collected by the national customs authorities of the EUcountries concerned.

Exporting producers may offer +undertakings+ , agreeing to sell at a minimum price# for

example. "f their offer is accepted# anti-dumping duties will not be collected on imports. he

!ommission is not obliged to accept an offer of an undertaking.

What is the (lesser duty rule(?

A duty may be imposed to remove the effects of dumping on imports of a particular product. An

assessment is also made of the level of duty needed to remove the inurious effects of dumping.easures will be imposed at the level of dumping or inury whichever is the lower.

)rotection against in"urious pricing of ships

EU rules include a regulation on the sale of newly built ships at excessively low prices.

For more details* see Shipbuilding
http://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/investigations/http://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/anti-dumping-flowchart.pdfhttp://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/conditions/http://ec.europa.eu/trade/creating-opportunities/economic-sectors/industrial-goods/shipbuilding/http://ec.europa.eu/trade/creating-opportunities/economic-sectors/industrial-goods/shipbuilding/http://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/investigations/http://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/anti-dumping-flowchart.pdfhttp://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/conditions/http://ec.europa.eu/trade/creating-opportunities/economic-sectors/industrial-goods/shipbuilding/


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What law is applied here?

he EU$sbasic anti-dumping /egulation complies with the EU$s international obligations , in

particular the 0% Anti-1umping Agreement .

+ow to proceed

An anti-dumping investigation can be initiated in response to acomplaint lodgedby European

manufacturers affected by dumped imports or at the re2uest of an EU country. !ommunity

producers who are considering lodging an anti-dumping complaint# should contact us.

,uration of measures and reviews

easures are generally imposed for years and may besubect to reviewif# for example*

the circumstances of the exporters have changed

importers reuesta full or partial refund of duties paid

new exporting producers reuest an accelerated review.

easures will lapse after years unless an expiry review is initiated.

he !ommission monitors measures to ensure they are effective and respected by exporters and importers.

What are antidumping (AD) and countervailing (CVD)

duties?

Antidumping Duties. Antidumping duties are additional import duties charged on

merchandise that the U.3. 1epartment of !ommerce determines is being sold at less

than its fair value (+dumped+) in the United 3tates. 1escribed simply# if the sale price

of the merchandise to the United 3tates (+export price+ or +E4+) is lower than the sale

price to the producer$s or exporter$s domestic market (+normal value+ or +56+)# then

the merchandise is being dumped. he 1epartment of !ommerce determines the

amount at which the merchandise is being dumped# also called the +dumping

margin.+ he simple formula is 56 - E4 7 dumping margin. At the same time# the

U.3. "nternational rade !ommission determines that the dumping is causing inury to

the U.3. producers of the same merchandise. "f the "nternational rade !ommission

determines that dumping is causing inury# the 1epartment of !ommerce imposes

additional import duties on entries of the merchandise. he effect is to make the

imported goods less competitive in the United 3tates to the benefit of the U.3.

producers.
http://trade.ec.europa.eu/doclib/html/146035.htmhttp://trade.ec.europa.eu/doclib/html/146035.htmhttp://www.wto.org/english/docs_e/legal_e/19-adp.pdfhttp://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/complaints/http://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/complaints/http://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/complaints/http://ec.europa.eu/trade/contact/#trade-defence-contactshttp://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/reviews/http://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/reviews/http://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/refunds/http://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/refunds/http://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/reviews/#expiry-reviewhttp://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/reviews/#expiry-reviewhttp://trade.ec.europa.eu/doclib/html/146035.htmhttp://www.wto.org/english/docs_e/legal_e/19-adp.pdfhttp://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/complaints/http://ec.europa.eu/trade/contact/#trade-defence-contactshttp://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/reviews/http://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/refunds/http://ec.europa.eu/trade/tackling-unfair-trade/trade-defence/anti-dumping/reviews/#expiry-review


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China, Vietnam, and other "Non-ar!et conomies." !hina# 6ietnam# and other

countries that have been designated as +5on-arket Economies+ (+5Es+) have a

significant disadvantage. "nstead of looking at the actual prices of the merchandise

sold in !hina# 6ietnam# or other 5Es# the U.3. 1epartment of !ommerce constructsa price from prices of the inputs to the merchandise. he price for the inputs is taken

from so-called +surrogate countries+ and usually results in a much higher normal

value# and thus a much higher dumping margin.

DISPUTE SETTLEMENT: DISPUTE DS34;European Communities De#initi&e Sa#eguarMeasure on Salmon

This summaryhas been

prepared bythe Secretariat

under its ownresponsibility.

The summary isfor general

informationonly and is not

intended toaffect therights and

obligations ofembers.

Current statusbac to top

Settle or terminate'(it%ra(n) mutuall!agree solution*on

3+ Ma! +4


Fin all

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See also:!The basics"how disputesare settled in

#T$! %omputer

based trainingon disputesettlement

! Te&t of theDispute

SettlementUnderstanding

$t%er isputesin&ol&ing:

!)griculturaland :ood!Salmon

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! EuropeanUnion

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Trade 1,,-!)greement

on Safeguards

Shorttitle"

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n%ommunities

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)greementscited"'as citedin re0uestforconsultations(

Safeguards")rt. -224+)TT1,,-")rt.I"1

/e0uestfor%onsultationsrecei7ed"

:ebruary 466

Summar! o# t%eispute to atebac to top

The summary belowwas uptodate at

4- :ebruary 4616

Consultations

%omplaint by %hile.

$n :ebruary 4662%hile re0uestedconsultations with theEuropean %ommunitiesregarding the latterFsdefiniti7e safeguard

top(

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http://www.wto.org/english/thewto_e/whatis_e/tif_e/disp1_e.htmhttp://www.wto.org/english/thewto_e/whatis_e/tif_e/disp1_e.htmhttp://www.wto.org/english/thewto_e/whatis_e/tif_e/disp1_e.htmhttp://www.wto.org/english/thewto_e/whatis_e/tif_e/disp1_e.htmhttp://www.wto.org/english/tratop_e/dispu_e/disp_settlement_cbt_e/signin_e.htmhttp://www.wto.org/english/tratop_e/dispu_e/disp_settlement_cbt_e/signin_e.htmhttp://www.wto.org/english/tratop_e/dispu_e/disp_settlement_cbt_e/signin_e.htmhttp://www.wto.org/english/tratop_e/dispu_e/disp_settlement_cbt_e/signin_e.htmhttp://www.wto.org/english/docs_e/legal_e/legal_e.htm#disputehttp://www.wto.org/english/docs_e/legal_e/legal_e.htm#disputehttp://www.wto.org/english/docs_e/legal_e/legal_e.htm#disputehttp://www.wto.org/english/docs_e/legal_e/legal_e.htm#disputehttp://www.wto.org/english/tratop_e/dispu_e/dispu_subjects_index_e.htm?id=G1http://www.wto.org/english/tratop_e/dispu_e/dispu_subjects_index_e.htm?id=G1http://www.wto.org/english/tratop_e/dispu_e/dispu_subjects_index_e.htm?id=G25http://www.wto.org/english/tratop_e/dispu_e/dispu_by_country_e.htm#chlhttp://www.wto.org/english/tratop_e/dispu_e/dispu_by_country_e.htm#eechttp://www.wto.org/english/tratop_e/dispu_e/dispu_by_country_e.htm#eechttp://www.wto.org/english/tratop_e/dispu_e/dispu_by_country_e.htm#eechttp://www.wto.org/english/tratop_e/dispu_e/dispu_agreements_index_e.htm?id=A9http://www.wto.org/english/tratop_e/dispu_e/dispu_agreements_index_e.htm?id=A9http://www.wto.org/english/tratop_e/dispu_e/dispu_agreements_index_e.htm?id=A9http://www.wto.org/english/tratop_e/dispu_e/dispu_agreements_index_e.htm?id=A9http://www.wto.org/english/tratop_e/dispu_e/dispu_agreements_index_e.htm?id=A18http://www.wto.org/english/tratop_e/dispu_e/dispu_agreements_index_e.htm?id=A18http://www.wto.org/english/docs_e/legal_e/25-safeg_e.htm#art4http://www.wto.org/english/docs_e/legal_e/25-safeg_e.htm#art5http://www.wto.org/english/docs_e/legal_e/25-safeg_e.htm#art2http://www.wto.org/english/docs_e/legal_e/25-safeg_e.htm#art2http://www.wto.org/english/docs_e/legal_e/gatt47_02_e.htm#art19_1http://www.wto.org/english/tratop_e/dispu_e/cases_e/ds326_e.htm#tophttp://openawindow%28%27/library/download_instructions_e.htm','links',650,550,1)http://openawindow%28%27/library/download_instructions_e.htm','links',650,550,1)http://openawindow%28%27http//docsonline.wto.org/help/faq/frames1/webhelp/faq.htm','links',650,550,1)http://openawindow%28%27http//docsonline.wto.org/help/faq/frames1/webhelp/faq.htm','links',650,550,1)http://openawindow%28%27http//docsonline.wto.org/help/faq/frames1/webhelp/faq.htm','links',650,550,1)http://emailWTO(%[email protected]%27%2C%20%27wto%20error%20-%20problem%20with%20page%27%29/http://emailWTO(%[email 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protected]%27%2C%20%27wto%20error%20-%20problem%20with%20page%27%29/http://emailWTO(%[email protected]%27%2C%20%27wto%20error%20-%20problem%20with%20page%27%29/


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measure againstimports of farmedsalmon imposedthrough %ommission/egulation 'E%( Go.

46;H4662 published inthe $fficial 5ournal ofthe European Union on :ebruary 466. Themeasure will be inforce from ; :ebruary466 to 13 )ugust466. The measureconsists of"

) system oftariff 0uotascalculated on

the basis ofpast imports ofsalmon intothe%ommunities.Imports offarmed salmonbeyond thele7el of thetariff 0uotashall besub?ect to anadditional duty

according tothe group towhich theybelong@

) minimumpriceapplicable toimports bothwithin andbeyond thetariff 0uota@

and2

) securitywhich must bepro7ided byimporters as aguarantee ofthe payment of


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the actualimport price.

$n 16 5anuary 4662the European

%ommunities notifiedthe #T$ of its findingsof serious in?ury and ofits proposed safeguardmeasure2 concerningfarmed salmon 'Docs.+HS+HGHHEE%H32+HS+HGH16HEE%H3and+HS+HGH11HEE%H3HSuppl.1(.

)ccording to theinformation pro7idedin the re0uest forconsultations2 %hilere0uested priorconsultations with theEuropean %ommunities'E%( pursuant to)rticle 14.3 of the)greement onSafeguards. The priorconsultations tooplace in Arussels on 465anuary 466.

%hile states in itsre0uest forconsultations that thedefiniti7e safeguardmeasure againstimports of farmedsalmon is inconsistentwith the E%Fsobligations under the#T$ agreements andseriously affects%hilean e&ports ofsalmon to the E%2

because in its opinion"

The productsub?ect to themeasures andits lie ordirectlycompetiti7eproducts were
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not properlydefined2 since is a

differentproduct fromthe produced bythe Europeanindustry.

There were noas a result of

which therewas anincrease inimports2 asre0uired by)rticle I of+)TT 1,,-.

There has notbeen anincrease inimports recentenough2suddenenough2 sharpenough2 norsignificantenough2 so asto cause orthreaten tocause seriousin?ury to thedomesticindustry asre0uired by

)rticle I of+)TT 1,,- andby )rticle 4.1of the)greement onSafeguards.Geither hasthere been anincrease in


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importsrelati7e todomesticproduction.

There is noserious in?urynor threat ofin?ury to thedomesticindustry andthedeterminationof in?ury madeby thein7estigatingauthority was

based onallegationsfrom thedomesticindustry2 andon con?ecturesand remotepossibilities2all of which isinconsistentwith )rticle-.4'a( of the)greement on

Safeguards.

Since there isno in?ury northreat ofin?uryattributable toan increase inimports2 thesafeguardmeasure wouldbe

incompatiblewith )rticle-.4'b( of the)greement onSafeguards.

:inally2 thesafeguard


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measureimposed onimports ofsalmon goesbeyond the

e&tentnecessary topre7ent orremedy theserious in?uryand tofacilitatead?ustment2 asre0uired by)rticle of the)greement onSafeguards.

$n 1 :ebruary 4662Gorway re0uested to?oin the consultations.$n 1 arch 4662 theEuropean %ommunitiesaccepted the re0uestof Gorway to ?oin theconsultations.

1it%ra(al2termination

$n 14 ay 4662 %hileformally withdrew itsre0uest forconsultations and toput an end to thismatter2 as thesafeguard measure atissue was terminatedas of 49 )pril 466.

"onta"t us" #orld Trade $rganiBation2 rue de Causanne 1-2 %=1411 +ene7a 412 SwitBerland

SAFE5UARD MEASURES:TE%=GI%)C IG:$/)TI$G

Te"%ni"al In#ormation on Sa#eguar Measures
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Appli"ation o# measures:! Definiti7e safeguard measures

!Pro7isional safeguard measures!Special and differential

treatment

Multilateral is"ipline:!Pree&isting measures

!Sur7eillance and notifications

5eneral prin"iples bac to top

The )greement on Safeguards '( sets forth the rules

for application of safeguard measures pursuant to )rticle I of+)TT 1,,-. Safeguard measures are defined as


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In its own words2 the S+ )greement2 which e&plicitly applies e0ually toall embers2 aims to" 'i( clarify and reinforce +)TT disciplines2particularly those of )rticle I@ 'ii( reestablish multilateral controlo7er safeguards and eliminate measures that escape such control@ and'iii( encourage structural ad?ustment on the part of the industries

ad7ersely affected by increased imports2 thereby enhancingcompetition in international marets.

Stru"ture bac to top

The )greement consists of fourteen articles and one anne&. In generalterms2 it has four main components" '1( general pro7isions ')rticles 1and 4(@ '4( rules go7erning embersJ application of new safeguardmeasures 'i.e.2 those applied after entry into force of #T$ )greement')rticles 3,((@ '3( rules pertaining to pree&isting measures that were

applied before the #T$ entry into force ')rticles 16 and 11(@and '-( multilateral obligations and institutions regarding applicationof safeguard measures ')rticles 141-(.

Co&erage bac to top

)rticle 1 establishes that the S+ )greement is the 7ehicle throughwhich measures may be applied pursuant to )rticle I of +)TT 1,,-.That is2 any measure for which the co7erage of )rticle I 'whichallows suspension of +)TT concessions and obligations under thedefined emergency circumstances( is in7oed2 must be taen inaccordance with the pro7isions of the S+ )greement. The )greemente&plicitly does not apply to measures taen pursuant to otherpro7isions of +)TT 1,,-2 to other )nne& 1) ultilateral Trade)greements2 or to protocols and agreements or arrangementsconcluded within the framewor of +)TT 1,,- ')rticle 11.1 'c((.

Conitions #or appli"ation o# sa#eguar measuresbac to top

)rticle 4 sets forth the conditions under which safeguard measures

may be applied. These conditions are" 'i( increased imports and'ii( serious in?ury or threat thereof caused by such increased imports Italso contains the re0uirement that such measures be applied on an:G basis.
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In"rease 8uantit! o# imports bac to top

The determination of increased 0uantity of imports that a embermust mae before it may apply a safeguard measure can be of eitheran absolute increase or an increase relati7e to domestic production.

In9ur!: T(o possi,ilities bac to top

Serious in9ur!

The )greement defines as a significant o7erallimpairment in the position of a domestic industry. In determiningwhether serious in?ury is present2 in7estigating authorities are toe7aluate all rele7ant factors ha7ing a bearing on the condition of theindustry. :actors that must be analyBed are the absolute and relati7erate and amount of increase in imports2 the maret share taen by theincreased imports2 as well as changes in le7el of sales2 production2producti7ity2 capacity2 utiliBation2 profits and losses2 and employmentof the domestic industry.

T%reat o# serious in9ur!

is threat that is clearly imminent as shownby facts2 and not based on mere allegation2 con?ecture or remotepossibility. If present serious in?ury is not found2 a safeguard measurene7ertheless can be applied if a threat of serious in?ury is found.

Domesti" inustr! bac to top

) is defined as the producers as a whole of thelie or directly competiti7e products operating within the territory of aember2 or producers who collecti7ely account for a ma?or proportionof the total domestic production of those products. This definitionallows a broader consideration of effects than in antidumping orcounter7ail cases.

Causation bac to top

) determination of serious in?ury cannot be made unless there isob?ecti7e e7idence of the e&istence of a causal lin between increasedimports of the product concerned and serious in?ury. :urther2 whenfactors other than increased imports are causing in?ury to thedomestic industry at the same time2 such in?ury must not be attributed
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17/28

to increased imports. The criterion of a causal lin falls short2howe7er2 of proposals made during the Uruguay /ound that would ha7ere0uired imports to be the of in?ury.

Nee #or in&estigation bac to top

Gew safeguard measures may be applied only following anin7estigation conducted by competent authorities in accordance withestablished procedures. Under )rticle I of +)TT 1,-92 there was noe&plicit re0uirement for an in7estigation.

Pro"eural transparen"! bac to top

In7estigation procedures must be established and published prior tobeing used. )lthough the )greement does not contain detailedprocedural re0uirements2 it does re0uire reasonable public notice ofthe in7estigation. The rele7ant authorities are obligated to publish adetailed analysis of the case in the form of a report presenting ande&plaining their findings on all pertinent issues2 including ademonstration of the rele7ance of the factors e&amined.

Parti"ipation ,! intereste parties bac to top

In7estigating authorities are re0uired to hold public hearings orpro7ide other appropriate means for interested parties 'importer2e&porters2 producers2 etc.( to present their 7iews and to respond tothe 7iews of others with respect to the matters being in7estigated.)mong the topics on which partiesJ 7iews are re0uired to be sought iswhether or not a safeguard measure would be in the public interest.

Con#iential in#ormation bac to top

The )greement also contains specific rules for the handling of

confidential information in the conte&t of an in7estigation. In general2information for which confidential treatment is re0uested must beaccompanied by a public summary thereof2 or an e&planation why nosuch summary is possible. If confidentiality is found not to bewarranted2 and the party submitting the information is unwilling tosummariBe it or authoriBe its disclosure2 the authorities may disregardthe information2 unless through other sources it is demonstrated thatthe information is correct.
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De#initi&e sa#eguar measures

Tari## measures bac to top

$ther than the general re0uirement that safeguard measures beapplied only to the e&tent necessary to remedy or pre7ent seriousin?ury and to facilitate ad?ustment2 the )greement pro7ides noguidance as to how the le7el of a safeguard measure in the form of anincrease in the tariff abo7e the bound rate should be set.

Le&el o# 8uotas an 8uota moulation bac to top

If the measure taes the form of a 0uantitati7e restriction2 the le7elmust not be below the actual import le7el of the most recent threerepresentati7e years2 unless there is clear ?ustification for setting adifferent2 lower2 le7el. /ules also go7ern how 0uota shares are to beallocated among supplier countries based on past maret shares. Thesele7els may be departed from 'i.e. the 0uota le7els may be modulated(if 'i( the percentage increase in imports from certain embers hasbeen disproportionate to the o7erall increase in imports2 'ii( thereasons for the departure from the general rule are ?ustified2 and 'iii(the conditions of such a departure are e0uitable to all suppliers of theproduct concerned.

Duration an re&ie( o# measures bac to top

The ma&imum duration of any safeguard measure is four years2 unlessit is e&tended consistent with the )greementJs pro7isions. In particular2a measure may be e&tended only if it is found2 through a newin7estigation2 that its continuation is necessary to pre7ent or remedyserious in?ury2 and only if e7idence shows that the industry isad?usting. The initial period of application plus any e&tension generallycannot e&ceed eight years 'See"special and differential treatment(. Inaddition2 safeguard measures in place for longer than one year mustbe progressi7ely liberaliBed at regular inter7als during the period ofapplication. If a measure is e&tended beyond the initial period2 and it

should continue to be liberaliBed. )ny measure of more than threeyears duration must be re7iewed at midterm. If appropriate2 based onthat re7iew2 the ember applying the measure must withdraw it orincrease the pace of its liberaliBation.
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19/28

Le&el o# "on"essions an ot%er o,ligations bac to top

5eneral rule

embers applying safeguard measures generally must for themthrough payment of compensation. ) ember applying a safeguardmeasure must maintain a substantially e0ui7alent le7el of concessionsand other obligations with respect to affected e&porting embers. Todo so2 any ade0uate means of trade compensation may be agreedamong the affected embers through consultation. )bsent suchagreement on compensation within 36 days2 the affected e&portingembers indi7idually may suspend substantially e0ui7alent concessionsand other obligations 'i.e.2 ( unless the %ouncil for Trade in+oods disappro7es.

Partial e"eption

The right to retaliate2 if compensation is not agreed on2 cannot bee&ercised during the first three years of application of a safeguardmeasure if the measure is taen based on an absolute increase inimports2 and otherwise conforms to the pro7isions of the )greement.

Reappli"ation o# measures to a prou"t bac to top

Special rules limit reapplication of safeguard measures to a gi7enproduct. $rdinarily2 a safeguard may not be applied again to a product

until a period e0ual to the duration of the original safeguard measurehas elapsed pro7ided that such period of nonapplication mustgenerally be at least two years. Gonetheless2 if a new safeguardmeasure has a duration of 16 days or less2 it may be applied so longas one year has elapsed since the date the original safeguard measurewas introduced2 and so long as no more than two safeguard measuresha7e been applied on the product during the fi7e years immediatelypreceding the date of introduction of the new safeguard measure ' Seespecial and Differential Treatment.(

Pro&isional sa#eguar measures

Arti"le ; bac to top

Under critical circumstances2 defined as circumstances where delaywould cause damage that would be difficult to repair2 pro7isionalmeasures may be imposed2 on the basis of a preliminary determinationthat there is clear e7idence that increased imports ha7e caused orthreaten to cause serious in?ury. Such measures should be in the form
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20/28

of refundable tariff increases2 and may be ept in place for ama&imum of 466 days. The period of application of any pro7isionalmeasure must be included in the total period of application of asafeguard measure.

Spe"ial an i##erential treatment

Introu"tion bac to top

De7eloping country embers recei7e special and differentialtreatment with respect to other embersJ safeguard measures2 in theform of a de minimis import 7olume e&emption. )s users of safeguards2de7eloping country embers recei7e special and differential treatmentwith respect to applying their own such measures2 with regard topermitted duration of e&tensions2 and with respect to reapplication of

measures.

De minimis import eemption bac to top

) safeguard measure shall not be applied to low 7olume fromde7eloping country embers. That is2 where imports from a singlede7eloping country ember account for no more than 3 per cent of thetotal imports of the product concerned2 and pro7ided de7elopingcountry embers below this threshold on an indi7idual basis do notcollecti7ely account for more than , per cent of those imports2 such

imports shall be e&cluded from the measure.

Pro&isions a##e"ting e&eloping "ountr! Mem,ers asusers o# sa#eguar measures bac to top

Duration o# etensions o# measures

In applying safeguard measures2 de7eloping country embers maye&tend the application of a safeguard for an e&tra two years beyondthat normally permitted 'i.e.2 to a total of si& years2 meaning that

de7eloping countries may apply a measure for a total of 16 years2 ascompared with the usual eight.

Re-appli"ation o# measures

The rules for reapplying safeguard measures with respect to a gi7enproduct are rela&ed for de7eloping country embers. 'The minimumperiod of nonapplication for de7eloping countries in most cases is
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onehalf the duration of the original measure2 so long as this period isat least two years(.

Pre-eisting measures

Arti"le


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application of safeguard measures2 to assist with consultations2 tomonitor the phaseout of pree&isting measures2 to re7iew proposedretaliation2 and to perform any other functions determined by the%ouncil for Trade in +oods.

Etensi&e noti#i"ation re8uirements bac to top

Noti#i"ation o# legislati&e #rame(or7

embers are re0uired to notify their own laws2 regulations andadministrati7e procedures2 and any changes thereto2 to the%ommittee.

Noti#i"ation o# in&estigations an appli"ation o# measures

embers are re0uired to notify the %ommittee of initiations ofin7estigations into the e&istence of serious in?ury or threat and thereasons therefore@ findings of serious in?ury or threat caused byincreased imports@ and decisions to apply or e&tend safeguardmeasures. Such notifications must contain the rele7ant information onwhich the decisions are based. embers are not obliged to discloseconfidential information in their notifications.

embers are re0uired2 before applying or e&tending a safeguardmeasure2 to pro7ide an ade0uate opportunity for consultations withembers who ha7e substantial interests as e&porters of the product.The aims of such consultations shall include re7iew of information asto the facts of the situation2 the e&change of 7iews on the proposedmeasures2 and the reaching of understandings as to maintainingsubstantially e0ui7alent le7els of concessions and obligations. Theresults such consultations must be notified.

Pro7isional measures must be notified before being applied2 andconsultations must be initiated immediately after such measures areapplied.

The results of consultations2 of midterm re7iews of measures taen2any form of concession2 andHor proposed suspension of concessions2must be notified immediately to the %ouncil for Trade in +oods

through the Safeguards %ommittee by the ember concerned.

Noti#i"ation o# pre-eisting measures

The )greement re0uires that embers notify their pree&istingmeasures2 both )rticle I and greyarea mesures2 that were in forceas of the date of entry into force of the #T$ )greement. #ith respect
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to greyarea mesures2 embers also are re0uired to ha7e notified atimetable according to which such measures are to be phased out orbrought into conformity with the )greement within the allowedtransition period.

Counternoti#i"ation

embers also are entitled to counternotify other embersJ rele7antlaws and regulations2 actions2 or measures in force.

Dispute settlement bac to top

%onsultations and disputes arising under the )greement are to beconducted in accordance with )rticles II and III of +)TT 1,,- as

elaborated by the Dispute Settlement Understanding.
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DISPUTE SETTLEMENT: DISPUTE DS3-1

Mei"o De#initi&e Counter&ailing Measures on $li&e

$il #rom t%e European Communities

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 embers.

See also:

! $ne-page summar! o# 7e!

#inings o# t%is ispute

! The basics" how disputes are

settled in #T$

!%omputer based training on

dispute settlement

!Te&t of the Dispute Settlement

Understanding

$t%er isputes in&ol&ing:

!)gricultural and :ood

! $li7e $il

!European Union 'formerly E%(

! e&ico

!)greement on )griculture

! +eneral )greement on Tariffs

and Trade 1,,-

!)greement on Subsidies and

%ounter7ailing easures

Current status bac to top

Implementation noti#ie ,! responenton 33 De"em,er +?


Short title" e&ico K $li7e $il

%omplainant" European %ommunities

/espondent" e&ico

Third Parties" %anada@ %hina@ 5apan@ Gorway@United States of )merica

)greements cited"'as cited in re0uest for

consultations(

)griculture" )rt. 13241.1

Subsidies and %ounter7ailing

easures" )rt. 12 162112 142 132 1-2

12 1;2 1,2442 34

+)TT 1,,-" )rt. *I

/e0uest for

%onsultations

recei7ed"

31 arch 466;

Panel /eport

circulated"

- September 466
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Summar! o# t%e ispute to ate bac to top

The summary below was uptodate at 4- :ebruary 4616

See also:$nepage summary of ey findings of this dispute

Consultations

%omplaint by the European %ommunities.

$n 31 arch 466;2 the European %ommunities re0uested consultations

with e&ico concerning the imposition by e&ico of definiti7e

counter7ailing measures on imports of oli7e oil from the European

%ommunities.

The European %ommunities claims that the initiation and conduct of the

in7estigations in this case2 as well as the imposition of definiti7e

counter7ailing measures are inconsistent with e&icoJs obligationsunder2 inter alia2

)rticle *I of +)TT 1,,-.

)rticles 12 162 112 142 132 1-2 12 1;2 1,2 44 and 34 of the S%)greement.

)rticles 13 and 41 of the )greement on )griculture.

$n 9 December 466;2 the European %ommunities re0uested theestablishment of a panel. )t its meeting on 1, December 466;2 the DSA

deferred the establishment of the panel.

Panel an Appellate @o! pro"eeings

)t its meeting on 43 5anuary 46692 the DSA established a panel. %anada2

%hina2 Gorway and the United States reser7ed their third party rights.

Subse0uently2 5apan reser7ed its third party rights. $n 13 :ebruary

46692 the European %ommunities re0uested the Director+eneral tocompose the Panel. $n 41 :ebruary 46692 the Director+eneral

composed the Panel. $n 1- Go7ember 46692 the %hair of the Panel

informed the DSA that it would not be possible to issue its report within

si& months due to the comple&ity of issues presented in the case as well

as the need to translate the partiesJ submissions. The Panel e&pects to

issue its final report to the parties by )pril 466.
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26/28

$n - September 4662 the Panel report was circulated to embers. The

Panel concluded that e&icoJs definiti7e counter7ailing measures on

oli7e oil from the European %ommunities were inconsistent with the

re0uirements of the S% )greement2 in that"

'a( e&ico acted inconsistently with )rticle 11.11 of the S% )greementbecause EconomLaJs in7estigation in this case was concluded more than

1 months after the date of its initiation2 and )rticle 11.11 does not

permit such prolongation under any circumstances@

'b( e&ico acted inconsistently with )rticle 14.-.1 of the S%

)greement because EconomLa failed to re0uire nonconfidential

summaries of confidential information in sufficient detail to permit a

reasonable understanding of the information submitted in confidence2 in

the absence of sufficient e&planations of the e&istence of e&ceptional

circumstances and of the reasons why summariBation was not possible@

and

'c( e&ico acted inconsistently with the obligation in )rticle 1.1 of the

S% )greement to base the in?ury determination on positi7e e7idence

and pursuant to an ob?ecti7e e&amination because EconomLa limited its

in?ury analysis to the periods from )pril to December of 46662 4661 and

4664.

The Panel further concluded that the European %ommunities did not

establish that e&ico acted inconsistently with certain obligations under

the S% )greement2 the )greement on )griculture and the +)TT 1,,- in

other respects.

In the light of its findings2 the Panel found it unnecessary to address the

European %ommunitiesJ claims under )rticles 1.1 and 1.- of the S%

)greement in respect of EconomLaJs analysis of the 7olume of subsidiBed

imports and the impact of these imports on prices in the domestic

maret for the lie product and on the domestic industry.

Pursuant to )rticle 1,.1 of the DSU2 ha7ing found that e&ico has acted

inconsistently with pro7isions of the S% )greement as set out abo7e2

the Panel recommended that e&ico bring its measures into conformity

with that )greement. The Panel declined to mae a suggestion2

pursuant to the second sentence of )rticle 1,.1 of the DSU2 as to how

e&ico should bring its measures into conformity with its obligations.

)t its meeting on 41 $ctober 4662 the DSA adopted the Panel report.


27/28

Implementation o# aopte reports

)t the DSA meeting on 19 Go7ember 4662 e&ico stated that it would

implement the DSA recommendations and rulings as soon as possible.

)t the DSA meeting on 11 December 4662 e&ico informed the DSA thaton 44 5anuary 4662 a domestic court had ordered the e&ican

in7estigating authority to remo7e the counter7ailing duties imposed on

oli7e oil from the E%. %onse0uently2 on 1 Go7ember 4662 e&ico had

published in the $fficial 5ournal of the :ederation a resolution for the

elimination of the counter7ailing duties that had been the sub?ect of

this dispute2 thereby complying with the DSA recommendations and

rulings.

/0$2 3 245/ 2416,7%'18)A9:/7 A;9/// A7$ Art. 1%.1 6invitation prior to initiation of investigation8 :he /uropean $ommunities did not establishthat


28/28

exico infringed the reuirement in Art. 1%.1 to invite the exporting embers for consultations prior toinitiation./conom@a issued the invitation prior to initiating* and the obligation is to in$ite the ember prior to initiation*notto hold consultations* and not to issue the invitation in suDcient time to allow consultations to be held priortoinitiation.> A7$ Art. 1 and 1' :he reuirement to conduct a Epass-throughE analysis when a subsidiCed product is aninput to the investigated product and the producers of the respective products are unrelated is not found inArticle1 or 1' of the 7$ Agreement* the provisions cited in the /$(s claim. /ven if there were such a reuirementinthese provisions* /conom@a(s conclusion was reasonable that under the facts of the investigation* no pass-throughanalysis was reuired.> A7$ Art. 1.1 6deBnition of domestic industry8 :he deBnition of Edomestic industryE set forth in Art. 1.1does not reuire that the applicant be producing at or near the date of Bling its application or during theperiodof investigation for subsidiCation* and /conom@a(s conclusion that the applicant was the Edomestic industryEwasreasonable. :he /uropean $ommunities thus did not establish that the initiation and the in"ury determinationwere Gawed because there was no domestic industry.> AA Art. 1%6b86i8 Art. 1% does not prohibit initiation or imposition of countervailing measures premised on

Ematerial retardationE* and even if such a prohibition existed* in fact this was not the basis of the initiation orthein"ury determination. :he /$ also failed to establish that /conom@a did not exercise due restraint in initiatingtheinvestigation.

. OT!ER ISSUES> $onsistent with prior panels %Mei!o & 'ipe and (ubes, Mei!o & Anti)dumpin* Measures on +i!e the )anelfoundthat exico(s use of three consecutive nine-month periods for the in"ury analysis was inconsistent with theobligation in Article 1H.1 to ma&e an ob"ective examination based on positive evidence.> :he )anel also found that /conom@a had provided reasoned and adeuate explanations as to why itconcludedthat there were no domestic producers other than the applicant and no factors other than the subsidiCedimports

which could be causing in"ury.