RESTRICTEDWORLD TRADE
ORGANIZATIONWT/DSB/M/57
19 May 1999
(99-2030)
Dispute Settlement Body
19 March 1999
MINUTES OF MEETING
Held in the Centre William Rappard
on 19 March 1999
Chairman:  Mr. Nobutoshi Akao (Japan)
Subjects discussed: Page
1. Surveillance of implementation of recommendations adopted by the DSB.........................2
(a) India - Patent protection for pharmaceutical and agricultural chemical products:
Status report  by India......................................................................................................... .........2
(b) European Communities - Measures concerning meat and meat products (hormones):
Status report by the European Co mmunities ..............................................................................2
(c) Argentina - Measures affecting imports of footwear, textiles, apparel and other items:
Status report by Argentina ..................................................................................................... .....4
2. Korea - Taxes on alcoholic beverages .....................................................................................4
(a) Implementation of the reco mmendations of the DSB.................................................................4
3. European Communities - Measures affecting the importation of certain poultry
products ....................................................................................................................... ..............5
(a) Statement by Brazil concerning implementation of the recommendations of the DSB..............5
4. Japan - Measures affectin g agricultural products.................................................................6
(a) Report of the Appellate Body and Report of the Panel...............................................................6
5. United States - Anti-dumping duty on dynamic random access memory
semiconductors (DRAMS) of one megabit or above from Korea.........................................8
(a) Report of the Panel ......................................................................................................... ............8WT/DSB/M/57
Page 2
1. Surveillance of implementation of recommendations adopted by the DSB
(a) India - Patent protection for pharmaceutical and agricultural chemical products:  Status report
by India (WT/DS50/10/Add.3)
(b) European Communities - Measures concerning meat and meat products (hormones):  Status
report by the European Communities (WT/DS26/17/Add.2 - WT/DS48/15/Add.2)
(c) Argentina - Measures affecting imports of footwear, textiles, apparel and other items:  Status
report by Argentina (WT/DS56/15/Add.2)
The Chairman recalled that Article 21.6 of the DSU required that, "Unless the DSB decided
otherwise, the issues of implementation of the recommendations of rulings shall be placed on the
agenda of the DSB meeting after six months following the date of the establishment of the reasonable
period of time pursuant to paragraph 3 and shall remain on the DSB's agenda until the issue is
resolved".  He proposed that the three sub-items be considered separately.
(a) India - Patent protection for pharmaceutical and agricultural chemical products:  Status report
by India (WT/DS50/10/Add.3)
The Chairman drew attention to document  WT/DS50/10/Add.3, which contained India's
fourth status report regarding its progress in the implementation of the DSB's recommendations
concerning patent protection for pharmaceutical and agricultural chemical products.
The representative of India said that, as outlined in the status report, a bill to replace the
Patents Ordinance 1999, promulgated by the Go vernment of India on 8 January 1999 had been
introduced in the Budget Session of the Indian Parliament.  That bill had recently been passed by both
houses of the Parliament.
The representative of the United States said that her delegation appreciated India's status
report regarding the Patents Ordinance.  As stated at the 17 February meeting, the United States had
consulted with India on the new legislation, and hoped to continue these bilateral consultations with a
view to finding a mutually agreed solution.
The representative of the European Communities said that the EC, which had an important
interest in the matter, had participated in the cons ultations requested by the United States, and wished
to continue to be associated with these consultations.
The DSB took note of the statements and agreed  to revert to this matter at its next regular
meeting.
(b) European Communities - Measures concerning meat and meat products (hormones): Status
report by the European Communities (WT/DS26/17/Add.2 - WT/DS48/15/Add.2)
The Chairman drew attention to document  WT/DS26/17/Add.2 - WT/DS48/15/Add.2 which
contained the third status report by the EC on its progress in the implementation of the DSB's
recommendations on measures concer ning meat and meat products.
The representative of the European Communities said that further to the third status report, he
wished to add that as indicated at the 17 February meeting, the EC had now started discussions with
the United States and proposed to do so with Canada, with a view to evaluating the merits of the
different options under consideration.  In particular, a suggestion had been made regardingcompensation which was one of the options envisaged in the DSU and in the EC's options paper.WT/DSB/M/57
Page 3
The representative of the United States said that her delegation appreciated receiving the EC's
third status report regarding its compliance with  the DSB's recommendations.  The main difference
between the present report and the previous report s was that the EC had acknowledged that it could
not be in compliance by the deadline of 13 May.  The United States was disappointed that, once again,
the EC would fail to meet its WTO-obligations and had waited nearly a year to begin consideration ofpossible options for compliance.  She noted that during the entire period of time, the EC had not
provided any scientific justification for maintaining its ban on beef from cattle to which specific
hormones had been administered to promote their growt h.  In the status report the EC had referred to a
report to the European Council and Parliament.  The United States had received this report and
considered it to be a positive move.  It was encouraged to note that the EC supported the principles of
the SPS Agreement and that the EC, as a major exporter, recognized the importance of that
Agreement.  The United States wished to make some comments with regard to the three options
outlined in the EC's report.
One option considered by the EC related to labelling.  The United States had presented to the
EC a specific and formal proposal on labelling,  which it believed would resolve this dispute and
provide the access sought by the United States.  In other words, the United States would label its beefto enable European consumers to recognize beef of US origin.  This meant that the United States was
willing to take a substantial step forward towards meeting EC concerns.  It was obvious, however, that
the EC's ban on US beef would have to be lifted for this labelling proposal to achieve access for US
beef.  Another option the EC was considering was compensation;  i.e. reducing tariffs or other
restrictions on some US exports to the EC.  The United States realized that the WTO rules allowed thelosing party to propose compensation.  If the EC made a proposal that would provide real enhanced
access for US beef, the United States would consider it and follow the WTO rules.  However, the US
position was clear.  The EC's obligation was to comply with the DSB's rulings and to remove its ban
on imports of US beef by 13 May.  The United States viewed compensation as a temporary measure
until the ban was lifted.
Another option outlined by the EC was invoking Article 5.7 of the SPS Agreement which
allowed a Member to protect its population on a temporary basis when sufficient scientific evidence
was lacking, but there might be sound reason to believe that the product was unsafe.  This was clearly
not the case with hormones which were among the most thoroughly tested and reviewed compounds,
and which had not been found to be unsafe.  Any EC attempt to invoke this provision would be
entirely unjustified and completely unacceptable to the United States.  Such action would make itimpossible to resolve this issue and would threaten the integrity of the WTO.
She said that exports of US beef had been denied access to the EC market for a decade based
on a measure that had been proven to be inconsistent with the WTO rules.  However, more was at
stake than market access.  The fundamental principle of using science as a basis for non-tariffrestrictions was in question.  All Members had a serious stake in the integrity of the SPS Agreement.
In each case before the WTO, the affected Members, including the United States, had complied with
the WTO rulings.  The WTO principles and its credibility were now on the line with the world
watching how the United States and the EC would resolve their differences.  The WTO rules called
for the EC to comply with the DSB's recommendatio ns and to remove the ban on US beef by 13 May
1999, a date that was fast approaching.
The representative of Canada thanked the EC for submitting its third status report.  Her
delegation noted that the EC had acknowledged that it might not complete its scientific studies by the
deadline of 13 May.  As already stated previous ly, Canada was extremely disappointed that instead of
taking immediate steps to remove the ban, the EC had chosen to carry out further research.  This,
despite the conclusions of numerous studies that these hormones were safe, and the fact that in the
ten-year period since the ban had been imposed, the EC had been unable to provide credible scientific
evidence in support of its measure.  However, the fact that this research might not be completedWT/DSB/M/57
Page 4
before 13 May did not change the EC's obligation to comply with the DSB's recommendations by that
date.  It appeared that in the report prepared to the Council and the European Parliament, the EC
recognized this obligation.  Canada considered that the said report which outlined various options for
consideration, including compensation, was a constructive basis on which to engage discussion with
the EC.  However, she cautioned the EC against the option of converting the current ban into atemporary one, which Canada would view as an attempt by the EC to avoid its WTO obligations.
This could well lead to another bitter dispute over implementation.  Her delegation noted that the EC
had indicated its interest in exploring the feasibility of compensation.  Canada was prepared to review
any EC offers to compensate the Canadian beef industry that had been impaired by the measure, and
looked forward to receiving such proposals.
The DSB took note of the statements and agreed
 to revert to this matter at its next regular
meeting.(c) Argentina - Measures affecting imports of footwear, textiles, apparel and other items:  Status
report by Argentina (WT/DS56/15/Add.2)
The Chairman drew attention to document WT/DS56/15/Add.2 which contained the third
status report by Argentina on its progress in the implementation of the DSB's recommendations on
measures affecting imports of footwear, textiles, apparel and other items.
The representative of Argentina said that, as outlined in the status report on 11 February 1999,
the President of Argentina had signed Decree 108/99, which had been published in the Official
Bulletin of the Republic of Argentina on 24 February.  Under this Decree, as from 30 May 1999, no
import transactions covered by the statistical tax could be taxed in excess of the amounts indicated in
document WT/DS56/14, which contained the agreement reached by Argentina and the United States
on the implementation of the DSB's recommendations.
The representative of the United States expressed appreciation to Argentina for working
closely with the United States and for its cooperation in resolving implementation issues in this case.
The DSB took note of the statements and agreed  to revert to this matter at its next regular
meeting.
2. Korea - Taxes on alcoholic beverages
(a) Implementation of the recommendations of the DSB
The Chairman recalled that in accordance with the DSU provisions, the DSB was required to
keep under surveillance the implementation of recommendations and rulings of the DSB in order to
ensure effective resolution of disputes to the benefit of all Members.  In this respect, Article 21.3 ofthe DSU provided that the Member concerned had to inform the DSB, within 30 days after the date of
adoption of the panel or Appellate Body report, of its intentions in respect of implementation of the
recommendations of the DSB.  He recalled that on 17 February 1999 the DSB had adopted the
Appellate Body Report on "Korea - Taxes on Alcoholic Beverages" as well as the Panel Report on
this matter, as upheld by the Appellate Body Report.  He said that the item had been inscribed on theAgenda of the present meeting at the request of Korea.
The representative of Korea said that, at the 17 February meeting, Korea had expressed its
systemic concerns with regard to the Panel's and the Appellate Body's findings and rulings. However,
despite its concerns, Korea had accepted the adoption of the Reports, and had stated that it wouldinform the DSB, pursuant to Article 21.3 of the DSU, of its intentions in respect of theWT/DSB/M/57
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implementation of the DSB's recommendations.  At the present meeting, he wished to re-confirm
Korea's commitment to meet its WTO obligations wi th regard to this matter.  Korea had already
initiated a process of examining all options for compliance.  However, in view of the internal
decision-making process, it was not yet in a position to elaborate on any detail of the modalities for
implementation.  Korea's intention was to act in an expeditious manner in consultations with the otherparties to the dispute.  To this end, consultations had been held with the EC and the United States on 9
March in Brussels and 10 March in Geneva respectively.  The second round of consultations was
expected to be held later in the month.  Korea would continue to work closely with the other parties to
the dispute to ensure smooth progress in implementing the DSB's recommendations.  He emphasized
that in light of the legislative process involved in this matter, a reasonable period of time, as stipulated
in Article 21.3, would be required in order to comply with the recommendations.  Korea's
implementing measures would be formulated on the basis of the Panel's and the Appellate Body'srulings.
The representative of the European Communities confirmed that contacts had been made with
Korea and would continue to be made.  He recalled the EC's position that an agreement on a
reasonable period of time for implementation had to be reached, in accordance with Article 21.3 ofthe DSU, before 3 April.  The EC was prepared to continue its contacts in order to reach an
agreement. The EC considered that the implementation of the DSB's recommendations by Korea,
namely to bring the present tax regime on alcoholic beverages into compliance, should be completed
in a short period of time.  With regard to the substance of this case, the EC believed that a specific tax
regime based on alcoholic content per bottle would ensure transparency and equity of the system.
The representative of the United States said that her country welcomed the statement by
Korea in which it had confirmed its commitment to implement the DSB's recommendations.  Her
delegation noted and appreciated that Korea had contacted the US Government, shortly after the
adoption of the Reports, to begin discussions of its compliance plan.  This was a good start.  TheUnited States believed that Korea could come into compliance with its WTO obligations within a very
short period of time, since the panel decision dated back to July 1998.  Also, Korea's budget year and
National Assembly schedule permitted action in the near future.  She emphasized the need for Korea
to demonstrate its commitment to abide by its international obligations by eliminating the
discriminatory differentials in its taxes.  The United States strongly urged Korea to consider a specific
tax system for alcoholic beverages because such a system was the rule rather than the exception
among the OECD-countries.
The DSB took note of the statements and of the information provided by Korea regarding its
intention in respect of implementation of the DSB's recommendations.
3. European Communities - Measures affecting the importation of certain poultry
products
(a) Statement by Brazil concerning implementation of the recommendations of the DSB
The Chairman said that the item was on the agenda of the present meeting at the request of
Brazil.
The representative of Brazil said that on 6 March 1999, the EC had published in the EC
Official Journal its Regulation No. 493/99, amendi ng the EC Regulation No. 1484/95.  In the EC's
view, that new Regulation constituted the implementation of one of the two recommendations of the
DSB with regard to its utilisation of a representative price as a basis for the application of specialsafeguards to imports of certain poultry products.  The new regulation would become effective on
25 March 1999.  Brazil was currently engaged in informal consultations with the EC to discussWT/DSB/M/57
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concerns related to the measure taken by the EC to comply with the DSB's recommendations with
regard to the representative price.  Brazil continued to hope that it would be possible to find a
mutually agreed solution with regard to this matter.
The representative of the European Communities confirmed that the EC was willing to
continue its discussions with Brazil in order to find a solution to this matter.
The DSB took note of the statements.
4. Japan - Measures affecting agricultural products
(a) Report of the Appellate Body (WT/DS76/AB/ R) and Report of the Panel (WT/DS76/R)
The Chairman drew attention to the communi cation from the Appellate Body contained in
document WT/DS76/7 transmitting the Appellate Body Report in "Japan - Measures Affecting
Agricultural Products", which had been circulated  in document WT/DS76/ AB/R in accordance with
Article 17.5 of the DSU.  He reminded delegations that in accordance with the Decision on
Procedures for the Circulation and Derestriction of WTO Documents contained in WT/L/160/Rev.1,the Appellate Body Report and the Panel Report had been circulated as unrestricted documents.  He
recalled that Article 17.4 of the DSU required th at:  "An Appellate Body Report shall be adopted by
the DSB and unconditionally accepted by the parties to the dispute unless the DSB decides by
consensus not to adopt the Appellate Body report within 30 days following its circulation to the
Members.  This adoption procedure is without prejudice to the right of members to express theirviews on an Appellate Body Report".
The representative of the United States said that her country wished to praise the Reports
which were of high quality.  The Panel and the Appellate Body had to deal with very complex,
technical questions and novel legal issues, which they had handled with care and precision.  Thisdemonstrated that the dispute settlement mechanism could effectively address disputes dealing with
such measures.  The Reports' legal analysis had underscored and clarified the basic obligation under
Article 2.2 of the SPS Agreement that SPS measures could be maintained only with sufficient
scientific evidence.  The Reports had also provided an important clarification of the conditions to be
met in order for a measure to be provisionally adopted under Article 5.7 of the SPS Agreement.  The
United States believed that by clarifying the nature of the SPS obligations, the work of the Panel and
the Appellate Body would facilitate resolutions of disputes.  The United States noted that Japan,pursuant to Article 21.3 of the DSU, would state its intentions with respect to implementation within
the next 30 days.  Her country was interested in working on this issue with Japan in a very
constructive manner and looked forward to working together to resolve this dispute promptly.
The representative of Japan thanked the Pane l and the Appellate Body for their efforts in
examining this case.  He recalled that on 24 November 1998, Japan had appealed the Panel Report on
this matter since it had considered that the Panel had erred in its legal interpretations and findings
concerning Article 2 of the SPS Agreement and other relevant provisions thereof as well as the DSU
provisions.  Japan regretted that the Appellate Body had upheld the Panel's finding and had not
accepted Japan's arguments that the varietal testing requirement, as currently applied, was maintainedwith sufficient scientific evidence.  At the same time, Japan was satisfied with the Panel's conclusions
that it was not convinced by the US contention that "testing by product" would achieve Japan's
appropriate level of protection on the grounds that there was no sufficient evidence before the Panel.
Although the United States had appealed this issue, the Panel's conclusion had not been reversed
because the Appellate Body had considered that this issue related to the assessment of facts andtherefore fell outside the scope of appellate review.  As it had been already stated, Japan regretted
some of the findings of the Panel and the Appellate Body Reports.  However, neither ReportWT/DSB/M/57
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prevented Japan from taking appropriate measures against the intrusion of foreign pests into its
territory.  Japan would respect the WTO rules and did not oppose the adoption of the Reports of the
Panel and the Appellate Body.  It had already begun the examination of its measures found to be
inconsistent with the SPS Agreement and would inform the DSB of its intentions in respect of
implementation pursuant to Article 21.3 of the DSU.
The representative of the European Communitie s said that the EC welcomed the rulings in
this case, which had clarified some important concepts of the SPS Agreement.  However, the EC had
noted that, once again, the result raised questions as to the discretion left to panels in the evaluation of
scientific views.  In this respect, the outcome illus trated the need for a review of Article 17.6 of the
DSU which should allow to appeal not only "the issues of law covered in the panel report and legal
interpretations developed by the panel", but also manifestly erroneous or unreasonablecharacterisation or appreciation of the facts before the panel.  To this effect, the EC had made a
proposal in the DSU review.  It was also important  to review the case law on the allocation of the
burden of proof, in particular in the context of the SPS Agreement.  In the areas of human, animal or
plant life or health, or protection of the environment, placing the burden of proof almost exclusively
on the defending Member, as it had been done in the present Report, seemed to be contrary to the lawand practice of almost all legal jurisdictions.
The representative of Brazil said that his country had participated as a third party in the Panel
and the Appellate Body proceedings.  Brazil welcomed the final results of the proceedings since the
Appellate Body had upheld the main findings of the Panel with regard to the lack of scientificevidence - within the meaning of Article 2.2 of the SPS Agreement - concerning the varietal testing
requirement maintained by Japan.  He stressed that Brazil's interest in this case was not only of a
systemic nature, but was linked to very concrete trade concerns.  Since 1986, Brazilian authorities had
been negotiating with their Japanese counterparts with a view to initiating exports of mangoes to
Japan.  Brazil had carried out the necessary research and had developed an effective treatment for afirst variety of mangoes.  Recently, a calendar of actions had been agreed by both sides which
envisaged the opening of the Japanese market to Brazilian mangoes in the course of the second
trimester of the year of 2000.  If everything went well, and it was Brazil's intention to abide by the
calendar agreed upon by both governments, it would have taken 14 years to get approval for the first
variety of Brazilian mangoes to be sold in Japan.  Since Brazil cultivated more than one variety of
mangoes for exports, his country attached great importance to the Panel's and the Appellate Body's
findings according to which varietal testing for apples, cherries, nectarines and walnuts wasinconsistent with Article 2.2, and that the same requirements applied to apricots, pears, plums and
quince were not based on a risk assessment.  Brazil was aware that the terms of reference of the Panel
did not extend to other fruits, but hoped that the very important principles confirmed by the findings
of the Panel and the Appellate Body would guide Ja panese authorities in the application of the SPS
measures to all fruits, and their varieties, regardless of their origin, and would facilitate exports offruits to the Japanese market.
The representative of Hungary said that his country had participated in the Panel proceedings
as a third-party due to its trade interests in this matter.  Hungary welcomed the Reports of the Panel
and the Appellate Body, which had largely confirmed its assessment of the measures at issueconcerning their inconsistencies with the relevant provisions of the SPS Agreement.  In particular,
Hungary was pleased that with regard to Article 5.7 of the SPS Agreement both the Panel and the
Appellate Body had made it clear that this ex ception could be invoked only if all four relevant
requirements were met, and that it could not be used as a kind of broad "escape clause" from the basic
obligation stipulated in Article 2.2 of the SPS Agreement that any sanitary and phytosanitary
measures had to be "based on scientific principles" and "not maintained without sufficient scientific
evidence".  Hungary considered that this interpreta tion together with most of the others taken by the
Panel and the Appellate Body, would be instrumental for the SPS Agreement in continuing to fulfil itsWT/DSB/M/57
Page 8
fundamental rule of ensuring that SPS measures were not applied for reasons unrelated to the
protection of human, animal or plant life or health.
Hungary also welcomed the Appellate Body's findings that due to the absence of risk
assessment, "the varietal testing requirement as it applies to apricots, pears, plums and quinces… is
inconsistent with Article 5.1 of the SPS Agreement" (paragraph 143(f)), which had corrected an error
of the Panel.  He noted with disappointment that this finding had not led the Appellate Body to
conclude that the measure was inconsistent with Article 2.2 as well.  The matter at hand was an
important issue of law and not merely an assessment of the facts.  Therefore, under Article 17.6 of the
DSU, it could not have fallen outside the scope of appellate review.  He recalled that in the Hormones
case (WT/DS26/AB/R - WT/DS48/AB/R), the Appellate Body had stated that the violation of Article
5.1 "can be presumed to imply a violation of … Article 2.2."  This statement had subsequently beenconfirmed by the Appellate Body in the Salmon cas e (WT/DS18/AB/R).  Since in the case at hand the
Appellate Body had not found that Japan had rebutted this presumption, per analogiam,  it should have
reached the same conclusion.  The lack of consistency in this regard raised questions about legal
certainty and predictability, which were essential elements of a credible dispute settlement system.
Hungary hoped that Japan would be in a position to comply with the DSB's recommendations within a
short period of time.
The DSB took note of the statements and adopted
 the Appellate Body Report in
WT/DS76/AB/R and the Panel Report in WT/DS76/ R as modified by the Appellate Body Report.
5. United States - Anti-dumping duty on dynamic random access memory semiconductors
(DRAMS) of one megabit or above from Korea
(a) Report of the Panel (WT/DS99/R)
The Chairman recalled that at its meeting on 16 January 1998, the DSB had agreed to
establish a panel to examine the complaint by Korea.  The Report of the Panel contained in document
WT/DS99/R had been circulated on 29 January 1999, and was now before the DSB for adoption at the
request of Korea.  In accordance with Article 16.4 of the DSU, this adoption procedure was without
prejudice to the right of Members to express their views on the Panel Report.
The representative of Korea said that his delegation welcomed the adoption of the Panel
Report by the DSB at the present meeting and thanked the members of the Panel and the Secretariat
for their work.  For many years, the United States had used its anti-dumping law as a powerful tool for
closing markets to fairly traded imports.  The Panel in this case, had struck down one important aspect
of this abuse.  Therefore, Korea was grateful for invalidating this barrier to free trade.  During
administrative reviews covering three-and-a-half years, the US Department of Commerce had found
that two Korean companies, Hyundai Electronics and LG Semicon, were not dumping DRAMS.Nevertheless, the Department had unjustifiably refuse d to revoke the anti-dumping duty order.  Under
the US anti-dumping regulation, three years of no dumping was not enough.  The US Department of
Commerce would revoke an anti-dumping order, on ly where the exporting companies could prove to
the satisfaction of the Department that they were "not likely" to dump in the future.  The Panel had
agreed with Korea that the "not likely" criterion in the US anti-dumping revocation regime violatedArticle 11.2 of the Anti-Dumping Agreement.  Specifically, the Panel had rejected the US practice,
finding that it improperly shifted the burden of proof to the respondent companies and required them
to prove a negative, namely that they were "not likely" to dump in the future.  The Panel had found
that whenever an investigating authority conducted a revocation review, that authority had to bear the
burden of proof, to maintain a duty, and to affirmatively find that dumping was "likely" to continue orrecur if the anti-dumping duties were removed.WT/DSB/M/57
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In addition to invalidating the US regulation, the Panel had also found that the decision of the
US Department of Commerce not to revoke the an ti-dumping order on DRAMS from Korea based on
the "not likely" criterion was inconsistent with Article 11.2 of the Anti-Dumping Agreement.
Therefore, to implement the Panel's recommendations, the United States was obliged both to amend
its revocation regulation and to revoke the DRAMS anti-dumping order because, according to thePanel found, it had no legal basis.  The Panel's decision had significant implications beyond this case.
As currently drafted, the US sunset review regulations and procedures applied a standard very similar
to that which the Panel had rejected.  The United States should act promptly to revise these
regulations and procedures so as to comply fully with its WTO obligations.  Korea hoped that many
Members would be keenly interested in how the US would act, given the large number of anti-
dumping duty orders which the United States was obliged to review under the sunset provision.
Korea was concerned with the Panel's failure to accept its arguments regarding four of its
claims.  First, Korea had demonstrated that the US fa ilure to self-initiate a review of whether injury to
the US DRAM industry would be lik ely to continue or recur if the anti-dumping duty were removed,
was inconsistent with Article 11.2 of the Anti-Dumping Agreement.  After finding that no dumping
had occurred for a period of three-and-a-half year s, a review of whether dumping that would cause
injury was likely to recur was "warranted".  In the absence of a review to reaffirm the dated finding
that US DRAM producers were being injured by dumped imports from Korea, the maintenance of the
definitive anti-dumping duty was impermissible.
Second, Korea had showed that the US 0.5 per cent de minimis  threshold for administrative
reviews was inconsistent with the Anti-Dumping Agreement because any other interpretation was
impermissible.  The Panel's decision, in essence, was that there was no de minimis  standard for
reviews.  This finding was erroneous because it would yield a result at odds with the object and
purpose of the Agreement.  Third, Korea established that the United States had violated Articles 2 and
3 of the Anti-Dumping Agreement when, during the third US administrative review, it had extendedthe scope of the proceedings to include new products not in existence at the time of the investigation.
The Panel had concluded that Korea's product scope claim was inadmissible because it concerned US
actions that pre-dated the entry into force of the WTO Agreement.  This ruling was erroneous because
it ignored the fact that the United States had taken action regarding product scope during its third
administrative review, which had taken place after the entry into force of the WTO.
Korea regretted that the Panel had not addressed one of its central claims.  The Panel had
ignored Korea's claim that the United States had violated paragraphs 1 and 2 of Article 11 of the Anti-
Dumping Agreement when it had failed to revoke the order after finding no dumping for three-and-a-
half consecutive years.  Korea had demonstrated that there was no dumping and thus no injury caused
by dumping for such a long period, and therefore the definitive duty was not "necessary to offset
dumping that is causing injury", as required by paragraphs 1 and 2 of Article 11 of the Agreement.Therefore the US Department of Commerce should be obliged to revoke the anti-dumping order.
Despite these concerns, Korea reiterated its satisfaction with the Panel's condemnation of the
central element of the US revocation regulation and practice;  i.e, the "not likely" criterion.  Korea
expected full and prompt compliance by the United States with its obligations to implement thePanel's recommendations.  Article 21.3 of the DSU made it clear that the basic obligation of the
United States was "to comply immediately with [ the Panel's ] recommendations and findings".  Only
where immediate compliance was not possible would the United States be entitled to "a reasonable
period of time" for implementation.  He highlighted this provision because the United States had to
implement immediately the Panel's ruling regardin g the determination not to revoke the DRAMS anti-
dumping duty order.  There was no justification unde r the DSU or the US legal system for delaying
the minor administrative action necessary to implement this aspect of the Panel's decision by revoking
the anti-dumping duty order.  Korea recognized th at under US law, the United States could not
implement the second aspect of the Panel's decision, namely, amending its revocation regulation,WT/DSB/M/57
Page 10
immediately.  Therefore, a reasonable period of time would be required.  Korea looked forward to
receiving the US views about the length of this period which should be as short as possible.  He noted
that when the United States was a complaining party, it strenuously demanded fast and effective
implementation.  This had been evidenced particularly over the past several months.  His delegation
was confident that the United States would act as it demanded others to act, and would carry out itsimplementation obligations fully and promptly.
The representative of the United States thanked the members of the Panel and the Secretariat
for their work on this case, which had involved many difficult issues.  The United States considered
that the Panel Report was of high quality and wished to make a few comments with respect to the
content of that Report.  First, the United States noted that the Panel had rejected the notion that the
mere absence of present dumping - or even the absence of dumping for a three-year period,automatically required a finding that the continued imposition of an anti-dumping duty order was no
longer justified.  As the United States maintained, the absence of a present dumping duty order might
be attributable solely to the existence of an anti-dumping duty order.  Therefore, a proper analysis
should be to determine what would happen if the order were removed.  The facts of this case
demonstrated why it was inappropriate to focus on what had happened in the past to the exclusion ofwhat might happen in the future.  In the fourth review of the Korean DRAMS order - the review
which had immediately followed the third review at issue before the panel - the US Department of
Commerce had found that the Korean exporters had, indeed, resumed dumping.  Second, the United
States had also noted the Panel's finding that 0.5 per cent de minimis  standard for the
post-investigative phase of an anti-dumping proceeding was not inconsistent with Article 5.8 of theAnti-Dumping Agreement.
With regard to procedural issues, the Panel had rejected Korea's request that the Panel suggest
revocation of the DRAMS anti-dumping order as the way for the United States to implement the
Panel's recommendation.  Instead the Panel had recognized "a range of possible ways in … the UnitedStates could appropriately implement its recommendation" (paragraph 7.4).  The Panel had, correctly,
left it to the United States to determine in the first instance what the method might be.  In addition, the
Panel had rejected Korea's attempt to challenge determinations made by the US Department of
Commerce during the original anti-dumping investigation on DRAMS from Korea, an investigation
that had been completed well before the WTO Agreement had entered into force.  The Panel had
correctly found that "pre-WTO measures do not become subject to the Anti-Dumping Agreement
simply because they continue to be applied on or  after the date of entry into force of the WTO
Agreement for the Member concerned" (paragraph 6.14).  On the other hand, there was one aspect of
the Panel report that the United States found troubling.  Under its current regulations, the US
Department of Commerce revoked an anti-dumping order after three years of no dumping only if it
was satisfied that a resumption of dumping was "not likely".  The Panel had found the US Department
of Commerce's "not likely" standard to be inconsistent with Article 11.2 of the Anti-DumpingAgreement.  In making this finding, however, the Panel had never pursued the proper question of
what did the US Department of Commerce's standard mean, as applied, under US law?  The United
States believed that if the Panel had asked the proper question, the results might have been different.
However, the United States was not interested in prolonging this dispute by means of an appeal.
Therefore, while the Panel Report was not perfect, there was much in it that made it worthy ofadoption and the United States could join in a consensus to adopt the Report.
The representative of Hong Kong, China said that her delegation would join in the consensus
to adopt the Panel Report, and welcomed the Panel's ruling on Article 11.2 of the Anti-Dumping
Agreement with regard to the "not likely" criterion.  While the Panel's rulings applied to the specificcase at hand, her delegation shared Korea's concerns over certain aspects concerning the interpretation
of the Anti-Dumping Agreement.  For example, what would warrant a self-initiated review of the
need for the continued imposition of an anti-dumpi ng duty, if not the finding that dumping had not
occurred for a period as long as three-and-a-half years? Why was it logical to have a lower de minimisWT/DSB/M/57
Page 11
dumping margin after a duty had been imposed, while a 2 per cent de minimis  dumping margin could
not lead to an anti-dumping duty in the first inst ance, and furthermore how should the Anti-Dumping
Agreement effectively apply to current actions regarding pre-WTO measures?  Hong Kong, China
would further study the Report and would reflect on the implications thereof with regard to its
position in the relevant WTO bodies.
The DSB took note of the statements and adopted  the Panel Report contained in WT/DS99/R.
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