WORLD TRADE WT/DS60/2
G/ADP/D3/2
13February 1997
ORGANIZATION(97-0518)
Original: Spanish
GUATEMALA -ANTI-DUMPING INVESTIGATION REGARDING
PORTLAND CEMENT FROM MEXICO
Request fortheEstablishment ofaPanel byMexico
Thefollowing communication, dated 4February 1997, from thePermanent Mission ofMexico
totheChairman oftheDispute Settlement Body iscirculated attherequest ofthatdelegation.
_______________
On15October 1996, theGovernment ofMexico requested theGovernment ofGuatemala to
conduct formal consultations under Article 17oftheAgreement onImplementation ofArticle VIof
theGeneral Agreement onTariffs andTrade 1994 (hereafter the"Anti-Dumping Agreement" or"AD")
andArticle 4oftheUnderstanding onRules andProcedures fortheSettlement ofDisputes (hereafter
"DisputeSettlementUnderstanding"or"DSU"),oftheWorldTradeOrganization(WTO).Inaccordance
with theprocedures laiddown intheDSU, thisrequest wasnotified totheDispute Settlement Body
(DSB), theCouncil forTrade inGoods andtheAnti-Dumping Committee. Therequest wascirculated
toWTO Members on24October 1996 (WT/DS60/1).
Theconsultations requested bytheGovernment ofMexico were held on9January 1997 in
Guatemala City, Guatemala. Astheconsultations didnotproduce asatisfactory solution tothematter
(asisshown bythefactthattheGovernment ofGuatemala notonly didnotrevoke theprovisional
anti-dumping duties butincreased them inthefinal resolution toalevel of89.54 percent, well above
theamount claimed bythepetitioner), andtaking intoaccount thatthetime-period established for
conducting consultations under Article 4oftheDSU hasbeen amply exceeded, theGovernment of
Mexico requests that atthenext meeting oftheDispute Settlement Body, scheduled for
25February 1997, adispute settlement panel beestablished toexamine theconsistency ofthe
anti-dumpinginvestigationbytheGovernmentofGuatemalaintoGuatemalanimportsofportlandcement
from Mexico with Guatemala 'sobligations under theWTO, inparticular those contained inthe
Anti-Dumping Agreement.
TheGovernment ofMexico requests thatthePanel examine, findandrulethattheanti-dumping
investigation inquestion isincompatible withGuatemala 'sobligations under theAD. Mexico considers
thatintheanti-dumping investigation inquestion actions were taken thatareinconsistent with, atleast,
Articles VIoftheGeneral Agreement onTariffs andTrade 1994, and2,3,5,6and7ofthe
Anti-Dumping Agreement andAnnex Ithereto. Bywayofexample, theaspects oftheinvestigation
presenting themain inconsistencies with theAnti-Dumping Agreement arehighlighted below.
(a) Initiation:
(i) Theapplication fortheinitiation oftheinvestigation submitted bythesole
cement-producing firm inGuatemala contains, among other shortcomings:WT/DS60/2
G/ADP/D3/2
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• simple assertions unsubstantiated byrelevant evidence forthe
determination ofthealleged dumping (e.g. only twoinvoices were
submitted, each foronesack ofcement, asproof ofprices onthe
Mexican market, from which itcannot possibly bededuced thatthey
arerepresentative, thatistosay,qualify asthenormal value; andas
proof oftheexport price, theonly evidence submitted wasphotocopies
oftwoimport certificates foratotal value ofabout US$30,000;
• allegations orconjectures astothethreat ofinjury totheGuatemalan
industry, without thepetitioner submitting anyevidence ofitsexistence
within themeaning ofArticle VIofGATT 1994 (e.g. asevidence of
thevolume ofimports -theGuatemalan investigating authority 'ssole
alleged proof ofinjury -theGuatemalan firm requested thatthis
information besought from theGuatemalan Directorate-General of
Customs, anditwasnotofficially available totheMinistry ofthe
Economy ofGuatemala until after theinvestigation hadbeen initiated);
• simple assertions astothecausal relationship between thedumped
imports andthealleged threat ofinjury totheGuatemalan industry,
without anyevidence atallhaving been submitted inthisrespect.
(ii) initiation oftheinvestigation bytheGuatemalan investigating authority without
examining theaccuracy and relevance oftheevidence submitted inthe
application todetermine whether there wassufficient evidence tojustify the
initiation oftheinvestigation, owing inter aliatotheabsence ofrelevant data
tocalculate normal value (this wasbased solely ontwoinvoices, each forone
sack ofcement, submitted bytheGuatemalan firm making theapplication),
shortcomings inthemethodology forcomparing thenormal value with the
export price (thelatter wascalculated exclusively onthebasis oftheabove-
mentioned twoimport certificates, without considering differences influencing
price comparability), absence ofevidence ofthreat ofinjury totheGuatemalan
industry andabsence ofrelevant proof oreven arguments todemonstrate the
existence ofacausal linkbetween thealleged dumping andthealleged threat
ofinjury.
(iii) lackofnotification totheGovernment ofMexico prior totheinitiation ofthe
investigation;
(iv) non-compliance with theobligation tomake available thefulltextofthe
application totheexporter andtotheGovernment ofMexico assoon asthe
investigation hadbeen initiated.
(b) Preliminary resolution:
(i) positive determination ofamargin ofdumping inviolation oftheguidelines
laiddown intheAgreement;
(ii) positive determination ofthreat ofinjury inviolation oftheguidelines laiddown
intheAgreement;WT/DS60/2
G/ADP/D3/2
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(iii) attempt toequate theaccumulation ofinventories ofrawmaterial (clinker) with
inventories oftheproduct under investigation (cement) forthedetermination
ofthreat ofinjury;
(iv) attribution toimports from Mexico ofthethreat ofinjury totheGuatemalan
domestic industry caused byother factors (e.g. increase ininventories, decline
insales, kilnstoppages, inter alia);
(v) failure todemonstrate acausal relationship between imports from Mexico and
thealleged threat ofinjury;
(c) Final stage oftheproceeding:
(i) extensionoftheinvestigationperiod,investigatedfirmsandinvestigatedproduct
10months after theinitiation oftheinvestigation;
(ii) irregularities inthenotification andconduct oftheverification visit tothe
Mexican exporting firm (e.g. lackofnotification totheMexican Government
oftheinclusion ofnon-governmental experts andnojustification oftheir
participation);
(iii) outright cancellation oftheverification visit bytheGuatemalan Government
asaresult oftheobjections bytheMexican Government andtheexporting
firm totheinclusion ofnon-governmental experts with apossible conflict of
interest intheconduct oftheverification visit andtothewish toverify
information notprovided during theinvestigation, thus treating itasan
"uncooperative" firm;
(iv) violation oftheMexican exporter 'sright ofdefence bydenying ittimely access
toexamine alltherelevant information forthepresentation ofitsarguments
andtoprepare itssubmission onthebasis ofsuch information (e.g. the
information corresponding tothefinal submissions presented inwriting bythe
petitioner atthepublic hearing andtheessential facts thatwould betaken into
account forthefinal resolution were notmade available totheexporter;
hindering ofaccess totheadministrative record, etc.).
TheGovernment ofMexico considers thattheanti-dumping investigation inquestion should
never have been initiated, owing totheinconsistencies thatarose from thevery start, andthatboth
itsinitiation anditssubsequent conduct ledtothenullification orimpairment ofbenefits accruing to
Mexico under theWTO, andinparticular under theAnti-Dumping Agreement, within themeaning
ofArticle XXIII ofGATT 1994 and17oftheAD.