WT/DS577/R  
 
19 November 2021  
(21-8711) Page: 1/146 
  Original: English  
 
  
 
UNITED  STATES  – ANTI -DUMPING  AND COUNTERVAILING  
DUTIES  ON RIPE  OLIVES  FROM  SPAIN  
REPORT OF THE PANEL  
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  WT/DS577/R  
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  TABLE OF CONTENTS  
 
1   INTRODUCTION  ................................ ................................ ................................ ........  19 
1.1   Complaint by the European  Union  ................................ ................................ ................. 19 
1.2   Panel establishment and composition  ................................ ................................ ............ 19 
1.3   Panel proceedings  ................................ ................................ ................................ .......19 
1.3.1    General  ................................ ................................ ................................ .................. 19 
1.3.2    Preliminar y ruling on the Panel's  terms of reference  ................................ ..................... 21 
1.3.3    Request to address certain aspects of the USDOC's  Remand Redetermination of 
29 May 2020 ................................ ................................ ................................ ..................... 21 
2   FACTUAL ASPECTS:  THE MEASURES AT ISSUE  ................................ ...........................  21 
3   PARTIES'  REQUESTS FOR FINDINGS AND RECOMMENDATIONS  ................................  22 
4   ARGUMENTS OF THE PARTIES  ................................ ................................ ...................  25 
5   ARGUMENTS OF THE THIRD PARTIES  ................................ ................................ ........  25 
6   INTERIM REVIEW  ................................ ................................ ................................ ...... 26 
7   FINDINGS  ................................ ................................ ................................ .................  26 
7.1   General principles regarding treaty interpretation, the applicable standard of r eview,   
and burden of proof  ................................ ................................ ................................ ........... 26 
7.1.1    Treaty interpretation  ................................ ................................ ................................ 26 
7.1.2    Standard of review ................................ ................................ ................................ ...26 
7.1.3    Burden of proof  ................................ ................................ ................................ .......27 
7.2   The European  Union's  claims concerning the USDOC's de jure specificity findings  
in the ripe olives countervailing duty investigation  ................................ ................................ .27 
7.2.1    The European  Union's  request to address the USDOC's  Remand Redetermination  
 as it relates to its original de jure specificity findings  ................................ ............................. 27 
7.2.2    The European  Union's  claims under Articles  2.1, 2.1(a),  and 2.4 of the  
SCM Agreement  ................................ ................................ ................................ ................. 29 
7.2.2. 1   Introduction  ................................ ................................ ................................ ......... 29 
7.2.2.2    Whether the USDOC was entitled under Article  2.1(a)  of the SCM  Agreement to 
determine de jure specific ity based on rules governing the amount  of a subsidy  ........................ 30 
7.2.2.3    The USDOC's  conclusion that the BPS and GP programmes retained the inherent  
 de jure specificity of the subsidies provided under the COMOF programme  ............................... 33 
7.2.2.3.1    The USDOC's  reliance on facts pertaining to past subsidy programmes  ..................... 33 
7.2.2.3.2    The USDOC's  alleged finding that the SPS, BPS, and GP subsidies were de jure 
 specific to olive growers  because they were coupled  (or tied) to the production  of olives  ............ 36 
7.2.2.3.3    Entitlement values under the BPS programme for new farmers, farmers holding 
transferred  entitlements, and farm ers no longer growing olives  ................................ ............... 42 
7.2.2.3.4    The USDOC's  rejection of arguments concerning the "convergence" factor  ................ 49 
7.2.2.3.5    The USDOC's  analysis and findings with respect to the "regional rate"  ...................... 52 
7.2.2.3.6    The USDOC's  alleged finding concerning differences in BPS payments based  
 on "the amount of grant money the different regions received under the SPS " .......................... 55 
7.2.2.3.7    The USDOC's  findings with respect to the SPS programme  ................................ ......57 
7.2.2.3.8    The USDOC's  findings with respect to the COMOF programme  ................................ .61 WT/DS 577/R  
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  7.2.2.3.9    Conclusion regarding the USDOC's findings that the BPS and GP programmes  
retained the inherent de jure  specificity of the subsidies provided under the  
COMOF  programme  ................................ ................................ ................................ ............ 64 
7.2.3    The European  Union's  claims under Articles  2.1, 2.1(b),  and 2.4 of the  
SCM Agreement  ................................ ................................ ................................ ................. 66 
7.2.4    The European  Union's  claim under Article  1.2 of the SCM  Agreement  ............................. 68 
7.3   The European  Union's  claims in relation to Section  771B of the Tariff Act of 1930  
 and its application in the ripe olives countervailing duty investigation  ................................ ......69 
7.3.1    The European  Union's  complaint against Section  771B of the Tariff Act of 1930  
"as such"  ................................ ................................ ................................ .......................... 69 
7.3.1.1    Legal requirements for conducting a pass -through analysis  ................................ ........ 71 
7.3.1.2    Legal characterization of the operation of Section  771B of the Tariff Act of 1930  ........... 74 
7.3.1.3    Conclusion  ................................ ................................ ................................ ........... 77 
7.3.2    The European  Union's  challenge concerning the USDOC's  application of Section  771B 
 in the Spanish ripe olives countervailing duty investigation  ................................ .................... 78 
7.3.2.1    The USDOC's  determination of benefit in the Spanish ripe olives countervailing duty 
investigation  ................................ ................................ ................................ ..................... 78 
7.3.2.2    Whether the USDOC's  determination of benefit in the Spanish ripe olive  
investigation complied with the applicable legal standard  ................................ ........................ 79 
7.3.2.3    Conclusion  ................................ ................................ ................................ ........... 79 
7.4   The USITC's  affirmative final injury determination  ................................ .......................... 79 
7.4.1    The United  States'  request for a preliminary ruling that claims under Article  15.4 
 of the SCM  Agreement and Article  3.4 of the Anti -Dumping  Agreement are outside the 
Panel's  terms of reference  ................................ ................................ ................................ ...80 
7.4.2    The European  Union's  request that the Panel make adverse inferences concerning  
 the United  States' failure to provide certain information requested by t he Panel  ........................ 85 
7.4.3    The USITC's  analysis of customer groups in its examination of volume and  
 price effects under Articles  3.1 and 3 .2 of the Anti -Dumping  Agreement and  
 Articles  15.1 and 15.2 of the SCM  Agreement  ................................ ................................ .......86 
7.4.3.1    Whether the USITC conducted a "segmented analysis" of volume and  
price effects that was inconsistent with Articles  3.1 and 3.2 of the Anti -Dumping  Agreement  
 and Articles  15.1 and 15.2 of the SCM  Agreement  ................................ ................................ .87 
7.4.3.2    Whether the USITC's  definition of the domestic industry made i t improper  
to consider customer groups  ................................ ................................ ............................... 92 
7.4.3.3    Conclusion on the USITC's  alleged "segmented analysis" of customer groups in its  
examination of volume and price effects under Articles  3.1 and 3.2 of the 
Anti-Dumping  Agreement and Articles  15.1 and 15.2 of the SCM  Agreement  ............................. 94 
7.4.4    The USITC's  examination of the volume of dumped and subsidized ripe olives  
from Spain  ................................ ................................ ................................ ........................ 94 
7.4.4.1    Whether the USITC failed to consider whether there has been a significant  
increase in dumped or subsidized imports as required by the first sentence in Article  3.2 
 of the Anti -Dumping  Agreement and Article  15.2 of the SCM  Agreement  ................................ ..94 
7.4.4.2    Whether the USITC's  volume analysis was not based on an objective examination of 
positive evidence in violation of Articles  3.1 and 3.2 of the Anti -Dumping  Agreement and 
Articles  15.1 and 15.2 of the SCM  Agreement  ................................ ................................ ........ 97 
7.4.4.2.1    Factual background  ................................ ................................ ............................ 97 
7.4.4.2.2    Whether the USITC only analysed the retail customer group and failed  
 to consider the industry as a whole  ................................ ................................ ..................... 98 WT/DS577/R  
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  7.4.4.2.3    Whether the USITC improperly drew conclusions about the industry as a whole  
 from the retail sector  ................................ ................................ ................................ ......... 99 
7.4.4.2.4    Whether the USITC failed to consider the distributio nal and institutional customer 
groups in like manner as the retail customer group, without satisfactory explanation  ................. 99 
7.4.4.2.5    Whether the USITC failed to consider the distributional and institutional/food  
 processor customer groups to the extent required for an objective examination based  
 on positive evidence  ................................ ................................ ................................ ........  101 
7.4.4.2.6    Whether the USITC's  volume analysis failed to provide a meaningful basis  
for causation  ................................ ................................ ................................ ...................  102 
7.4.4.3    Conclusion on the USITC's  volume analysis under Articles  3.1 and 3.2 of the 
Anti-Dumping  Agreement and Articles  15.1 and 15.2 of the SCM Agreement  ...........................  102 
7.4.5    The USITC's  examination of the price effects of dumped and subsidized ripe olives  
 from Spain  ................................ ................................ ................................ .....................  102 
7.4.5.1    Whether the USITC's  examination of price undercutting constituted a second  
volume analysis  ................................ ................................ ................................ ...............  103 
7.4.5.2    Whether the USITC's  price effects analysis was not based on an objective  
examination  of positive evidence in violation of Articles  3.1 and 3.2 of the  
Anti-Dumping  Agreement and Articles  15.1 and 15.2 of the SCM  Agreement  ...........................  106 
7.4.5.2.1    Factual background  ................................ ................................ ..........................  107 
7.4.5.2.2    Whether the USITC concluded that underselling resulted in a loss of market share  
in the retail sector without adequate supporting evidence  ................................ .....................  107 
7.4.5.2.3    Whether the USITC only considered price effects in the retail sector and not  
 at the level of the domestic industry as a w hole ................................ ................................ .. 110 
7.4.5.2.4    Whether the USITC improperly extended its conclusions concerning the  
 consideration of price effects in the retail sector to the domestic industry as a whole  ..............  111 
7.4.5.3    Conclusion on the USITC's  price effects analysis under Articles  3.1 and 3.2 of the 
Anti-Dumping  Agreement and Articles  15.1 and 15.2 of the SCM  Agreement  ...........................  112 
7.4.6   The USITC's  examination of the consequent impact of dumped and subsidized  
 ripe olives from Spain  ................................ ................................ ................................ ...... 112 
7.4.6.1    Whether the USIT C could have made a finding of consequent impact on the basis  
 of its findings concerning volume and price effects  ................................ ..............................  113 
7.4.6.2    Whether the USITC's  impact analysis was not based on an objective examination of 
positive evidence in violation of Articles  3.1 and 3.4 of the Anti -Dumping  Agreement and 
Articles  15.1 and 15.4 of the SCM  Agreement  ................................ ................................ ...... 114 
7.4.6.2.1    Factual background  ................................ ................................ ..........................  114 
7.4.6.2.2    Whether the USITC's  impact analysis only examined the retail sector and not the 
industry as a whole  ................................ ................................ ................................ ..........  115 
7.4.6.2.3    Whether the USITC's  impact analysis improperly extended the USITC finding  
 of market share losses in the retail sector to the industry as a whole  ................................ ..... 116 
7.4.6.3    Conclusion on the USITC's  impact analysis under Articles  3.1 and 3.4 of the 
Anti-Dumping  Agreement and Articles  15.1 and 15.4 of the SCM  Agreement  ...........................  117 
7.4.7    The USITC's  causation analysis of dumped and subsidized ripe olives from Spain ...........  117 
7.4.7.1    Whether the USITC's  non-attribution analysis of the decline in apparent  
consumption was not based on an objective examination of positive evidence in violation of 
Articles  3.1 and 3.5 of the Anti-Dumping  Agreement and Articles  15.1 and 15.5 of the 
SCM Agreement  ................................ ................................ ................................ ...............  118 
7.4.7.2    Whether the USITC's  non-attribution analysis of non-subject imports from Morocco  
 was not based on an objective examination of positive evidence in violation of  
Articles  3.1 and 3.5 of the Anti -Dumping  Agreement and Articles  15.1 and 15.5 of the 
SCM Agreement  ................................ ................................ ................................ ...............  120 WT/DS 577/R  
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  7.4.7.3    Conclusion on the USITC's  causation analysis under Articles  3.1 and 3.5 of the 
Anti-Dumping  Agreement and Articles  15.1 and 15.5 of the SCM  Agreement  ...........................  121 
7.4.8    Consequential claims  ................................ ................................ ..............................  121 
7.4.9    Conclusion in relation to the USITC's  Injury Determination  ................................ .........  121 
7.5   The European  Union's  claims concerning Aceitunas Guadalquivir's  final subsidy margin  
 and countervailing duty rate calculation  ................................ ................................ .............  122 
7.5.1    Introduction  ................................ ................................ ................................ ..........  122 
7.5.2    The USDOC's  calculation of Aceitunas Guadalquivir's  final subsidy margin and 
countervailing duty rate  ................................ ................................ ................................ .... 123 
7.5.2.1    The legal basis of t he European  Union's  claims in relation to the calculation of  
Aceitunas Guadalquivir's  subsidy margin and countervailing duty rate  ................................ .... 124 
7.5.2.2    Whether the USDOC properly determined Aceitunas Guadalquivir's  subsidy margin  
 and corresponding countervailing duty rate  ................................ ................................ ........  125 
7.5.2.2.1    The USDOC's initial 4  August  2017 questionnaire  ................................ .................  126 
7.5.2.2.2    The USDOC's information requests following the 4  August  2017 questionnaire  .........  129 
7.5.2.2.3    Aceitunas Guadalquivir's verification report  ................................ .........................  132 
7.5.2.2.4    Aceitunas Guadalquivir's submissions on the reported volume of raw olive  
purchases after the final determination  ................................ ................................ ...............  134 
7.5.2.2.5    Conclusion  ................................ ................................ ................................ ...... 135 
7.5.3    The USDOC's  calculation of an "all others" rate  ................................ ..........................  135 
7.5.4    Whether the USDOC properly requested information on purchases of raw olives used  
 to produce ripe olives consistently with Article  12.1 of the SCM  Agreement  ............................  136 
7.5.5    Whether the USDOC informed interested parties of the essential facts under  
consideration consistent with Article  12.8 of the SCM  Agreement  ................................ ...........  138 
7.5.6    Conclusion  ................................ ................................ ................................ ............  142 
8   CONCLUSIONS AND RECOMMENDATION  ................................ ................................ . 143  
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  LIST OF ANNEXES  
ANNEX  A 
PANEL DOCUMENTS  
Contents  Page  
Annex  A-1 Working Procedures of the Panel  4 
Annex  A-2 Additional Working Procedures concerning Business Confidential Information  11 
Annex  A-3 Communication from the Panel to the parties of 18  September  2020 concerning 
certain procedural matters   13 
Annex  A-4 Additional Working Procedures of the Panel concerning holding a Substantive 
Meeting Conducted via Cisco Webex – Adopted on 9  October  2020 14 
Annex  A-5 Additional Working Procedures of the Panel concerning holding a Substantive 
Meeting Conducted via Cisco Webex – Adopted on 30  November  2020 19 
Annex  A-6 Additional Working Procedures of the Panel: Open Meetings (Delayed Online 
Broadcast)  23 
Annex  A-7 Interim Review  24 
ANNEX  B 
ARGUMENTS OF THE PARTIES  
Contents  Page  
Annex  B-1 Integrated executive summary of the arguments of the European  Union  49 
Annex  B-2 Integrated executive summary of the arguments of the United  States  61 
ANNEX  C 
ARGUMENTS OF THE THIRD PARTIES  
Contents  Page  
Annex  C-1 Integrated executive summary of the arguments of Brazil  79 
Annex  C-2 Integrated executive summary of the arguments of Canada  82 
Annex  C-3 Integrated executive summary of the arguments of Japan  86 
Annex  C-4 Integrated executive summary of the arguments of Mexico  90 
Annex  C-5 Integrated executive summary of the arguments of Turkey  93 
 
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  CASES  CITED  IN THIS  REPORT  
Short Title  Full Case Title and Citation  
Argentina – Poultry 
Anti-Dumping Duties  Panel Report, Argentina – Definitive Anti -Dumping Duties on Poultry 
from Brazil , WT/DS241/R , adopted 19  May 2003, DSR 2003:V, p. 
1727 
Argentina – Textiles 
and Apparel  Appellate Body Report, Argentina – Measures Affecting Imports of 
Footwear, Textiles, Apparel and Other Items , WT/DS56/AB/R  and 
Corr.1, adopted 22  April 1998, DSR 1998:III, p. 1003  
Australia – 
Anti-Dumping 
Measures on Paper  Panel Report, Australia – Anti-Dumping Measures on A4 Copy Paper , 
WT/DS529/R  and Add.1, adopted 28  January  2020 
Australia – Apples  Appellate Body Report, Australia – Measures Affecting the Importation 
of Apples from New Zealand , WT/DS367/AB/R , adopted 
17 December  2010, DSR 2010:V, p. 2175  
Brazil – Desiccated 
Coconut  Appellate Body Report, Brazil – Measures Affecting Desiccated 
Coconut , WT/DS22/AB/R , adopted 20  March  1997, DSR 1997:I, p. 
167 
Canada – Aircraft  
 Appellate Body Report, Canada – Measures Affecting the Export of 
Civilian Aircraft , WT/DS70/AB/R , adopted 20  August  1999, DSR 
1999:III, p. 1377  
Canada – Wheat 
Exports and Grain 
Imports  Appellate Body Report, Canada – Measures Relating to Exports of 
Wheat and Treatment of Imported Grain , WT/DS276/AB/R , adopted 
27 September  2004, DSR 2004:VI, p. 2739  
Chile – Price Band 
System  Appellate Body Report, Chile – Price Band System and Safeguard 
Measures Relating to Certain Agricultural Produ cts, WT/DS207/AB/R , 
adopted 23  October  2002, DSR 2002:VIII, p. 3045 (Corr.1, DSR 
2006:XII, p. 5473)  
China – Autos (US)  Panel Report, China – Anti-Dumping and Countervailing Duties on 
Certain Automobiles from the United States , WT/DS440/R  and Add.1, 
adopted 18  June 2014, DSR 2014:VII, p. 2655  
China – Broiler 
Products  Panel Report, China − Anti-Dumping and Countervailing Duty 
Measures on Broiler Products from the United  States , WT/DS427/R  
and Add.1, adopted 25  September  2013, DSR 2013:IV, p. 1041  
China – Broiler 
Products (Article  21.5 – 
US) Panel Report, China − Anti-Dumping and Countervailing Duty 
Measures on Broiler Products from the United  States – Recourse to 
Article  21.5 of the DSU by the United  States , WT/DS427/RW  and 
Add.1, adopted 28  February  2018  DSR 2018:II, p. 839  
China – Cellulose Pulp  Panel Report, China – Anti-Dumping Measures on Imports of Cellulose 
Pulp from Canada , WT/DS483/R  and Add.1, adopted 22  May 2017, 
DSR 2017:IV, p. 1961  
China – GOES  Appellate Body Report, China – Countervailing and Anti -Dumping 
Duties on Grain Oriented Flat -Rolled Electrical Steel from the 
United  States , WT/DS414/AB/R , adopted 16  November  2012, DSR 
2012:XII, p. 6251  
China – GOES Panel Report, China – Countervailing and Anti -Dumping Duties on 
Grain Oriented Flat -Rolled Electrical Steel from the United  States , 
WT/DS414/R  and Add.1, adopted 16  November  2012, upheld by 
Appellate Body Repo rt WT/DS414/AB/R, DSR 2012:XII, p. 6369  
China – HP-SSST 
(Japan) / China – 
HP-SSST (EU)  Appellate Body Reports, China – Measures Imposing Anti -Dumping 
Duties on High -Performance Stainless Steel Seamless Tubes 
("HP-SSST") from Japan / China – Measures Imposing Anti -Dumping 
Duties on High -Performance Stainless Steel Seamless Tubes 
("HP-SSST") from the European  Union , WT/DS454/AB/R  and Add.1 / 
WT/DS460/AB/R  and Add.1, adopted 28  October  2015, DSR 2015:IX, 
p. 4573  WT/DS577/R  
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  Short Title  Full Case Title and Citation  
China – HP-SSST 
(Japan) / China – 
HP-SSST (EU)  Panel Reports, China – Measures Imposing Anti -Dumping Duties on 
High-Performance Stainless Steel Seamless Tubes ("HP -SSST") from 
Japan / China – Measures Imposing Anti -Dumping Duties on High -
Performance Stainless Steel Seamless Tubes ("HP -SSST") from the 
European  Union , WT/DS454/R  and Add.1 / WT/DS460/R , Add.1 and 
Corr.1, adopted 28  October  2015, as modified by Appellate Body 
Reports WT/DS454/AB/R / WT/DS460/AB/R, DSR 2015:IX, p. 4789  
China – Raw Materials  Appellate Body Reports, China – Measures Related to the Exportation 
of Various Raw Materials , WT/DS394/AB/R  / WT/DS395/AB/R  / 
WT/DS398/AB/R , adopted 22  February  2012, DSR 2012:VII, p. 3295  
China – X-Ray 
Equipment  Panel Report,  China – Definitive Anti -Dumping Duties on X -Ray 
Security Inspection Equipment from the European  Union , 
WT/DS425/R  and Add.1, adopted 24  April 2013, DSR 2013:III, p. 659  
EC – Bananas III  Appellate Body Report, European Communities – Regime for the 
Importation, Sale and Distribution of Bananas , WT/DS27/AB/R , 
adopted 25  September  1997, DSR 1997:II, p. 591  
EC – Bed Linen 
(Article  21.5 – India)  Panel Report, European Communities – Anti-Dumping Duties on 
Imports of Cotton -Type Bed Linen from India – Recourse to 
Article  21.5 of the DSU  by India , WT/DS141/RW , adopted 
24 April 2003, as modified by Appellate Body Report 
WT/DS141/AB/RW, DSR 2003:IV, p. 1269  
EC – Chicken Cuts  Appellate Body Report, European  Communities – Customs 
Classification of Frozen Boneless Chicken Cuts , WT/DS269/AB/R , 
WT/DS286/AB/R , adopted 27  September  2005, and Corr.1, DSR 
2005:XIX, p. 9157  
EC – Countervailing 
Measures on DRAM 
Chips  Panel Report, European Communities – Countervailing Measures on 
Dynamic Random Access Memory Chips from Korea , WT/DS299/R , 
adopted 3  August  2005, DSR 2005:XVIII, p. 8671  
EC – Fasteners (China)  Appellate Body Report, European Communities – Definitive Anti-
Dumping Measures on Certain Iron or Steel Fasteners from China , 
WT/D S397/AB/R , adopted 28  July 2011, DSR 2011:VII, p. 3995  
EC – Hormones  Appellate Body Report, European Communities – Measures Concerning 
Meat and Meat Products (Hormones) , WT/DS26/AB/R , 
WT/DS48/AB/R , adopted 13  February  1998, DSR 1998:I, p. 135  
EC – Poultry  Appellate Body Report, European Communities – Measures Affecting 
the Importation of Certain Poultry Products , WT/DS69/AB/R , adopted 
23 July 1998, DSR 1998:V, p. 2031  
EC – Selected Customs 
Matters  Appellate Body Report, European Communities – Selected Customs 
Matters , WT/DS315/AB/R , adopted 11  December  2006, DSR 2006:IX, 
p. 3791  
EC – Tube or Pipe 
Fittings  Panel Report, European Communities – Anti-Dumping Duties on 
Malleable Cast Iron Tube or Pipe Fittings from Brazil , WT/DS219/R , 
adopted 18  August  2003, as modified by Appellate Body Report 
WT/DS219/AB/R, DSR 2003:VII, p . 2701  
EC and certain member 
States – Large Civil 
Aircraft  Appellate Body Report, European Communities and Certain Member 
States – Measures Affecting Trade in Large Civil Aircraft , 
WT/DS316/AB/R , adopted 1  June 2011, DSR 2011:I, p. 7  
Egypt – Steel Rebar  Panel Report, Egypt – Definitive Anti -Dumping Measures on Steel 
Rebar from Turkey , WT/DS211/R , adopted 1  October  2002, DSR 
2002:VII, p. 2667  
EU – Biodiesel 
(Argentina)  Appellate Body Report, European  Union – Anti-Dumping Measures on 
Biodiesel from Argentina , WT/DS473/AB/R  and Add.1, adopted 
26 October  2016, DSR 2016:VI, p. 2871  WT/DS 577/R  
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  Short Title  Full Case Title and Citation  
EU – Biodiesel 
(Indonesia)  Panel Report, European  Union – Anti-Dumping Measures on Biodiesel 
from Indonesia , WT/DS480/R  and Add.1, adopted 28  February  2018  
DSR 2018:II, p. 605  
Guatemala  – Cement I  Appellate Body Report, Guatemala – Anti-Dumping Investigation 
Regarding Portland Cement from Mexico , WT/DS60/AB/R , adopted 
25 November  1998, DSR 1998:IX, p. 3767  
India – Patents (US)  Appellate Body Report, India – Patent Protection for Pharmaceutical 
and Agricultural Chemical Products , WT/DS50/AB/R , adopted 
16 January  1998, DSR 1998:I, p. 9  
Indonesia – Chicken  Panel Report, Indonesia – Measures Concerning the Importation of 
Chicken Meat and Chicken Products , WT/DS484/R  and Add.1, adopted 
22 November  2017, DSR 2017:VIII, p. 3769  
Japan – Alcoholic 
Beverages II  Appellate Body Report, Japan – Taxes on Alcoholic Beverages , 
WT/DS8/AB/R , WT/DS10/AB/R , WT/DS11 /AB/R , adopted 
1 November  1996, DSR 1996:I, p. 97  
Japan – DRAMs (Korea)  Appellate Body Report, Japan – Countervailing Duties on Dynamic 
Random Access Memories from Korea , WT/DS336/AB/R  and Corr.1, 
adopted 17  December  2007, DSR 2007:VII, p. 2703  
Korea – Dairy  Appellate Body Report, Korea – Definitive Safeguard Measure on 
Imports of Certain Dairy Products , WT/DS98/AB/R , adopted 
12 January  2000, DSR 2000:I, p. 3  
Korea – Pneumatic 
Valves (Japan)  Appellate Body Report, Korea – Anti-Dumping Duties on Pneumatic 
Valves from Japan , WT/DS504/AB/R  and Add.1, adopted 
30 September  2019 
Korea – Pneumatic 
Valves (Japan)  Panel Report, Korea – Anti-Dumping Duties on Pneumatic Valves from 
Japan , WT/DS504/R  and Add.1, adopted 30  September  2019, as 
modified by Appellate Body Report WT/DS504/AB/R  
Korea – Stainless Steel 
Bars Panel Report,  Korea – Sunset Review of Anti -Dumping Duties on 
Stainless Steel Bars , WT/DS553/R  and Add.1, circulated to WTO 
Members 30  November  2020 [appealed by Korea 22  January  2021] 
Mexico – Anti-Dumping 
Measures on Rice  Appellate Body Report, Mexico – Definitive Anti -Dumping Measures on 
Beef and Rice, Complaint with Respect to Rice , WT/DS295/AB/R , 
adopted 20  December  2005, DSR 2005:XXII, p. 10853  
Mexico – Corn Syrup  Panel Report, Mexico – Anti-Dumping Investigation of High Fructose 
Corn Syrup (HFCS) from the United  States , WT/DS132/R , adopted 
24 February  2000, and Corr.1, DSR 2000:III, p. 1345  
Mexico – Olive Oil  Panel Report, Mexico – Definitive Countervailing Measures on Olive Oil 
from the European Communities , WT/DS341/R , adopted 
21 October  2008, DSR 2008:IX, p.  3179 
Morocco – Definitive 
AD Measures on 
Exercise Books 
(Tunisia)  Panel Report, Morocco – Definitive Anti -Dumping Measures on School 
Exercise Books from Tuni sia, WT/DS578/R  and Add.1, circulated to 
WTO Members 27  July 2021 [appealed by Mor occo 28  July 2021]  
Morocco – Hot-Rolled 
Steel (Turkey)  Panel Report, Morocco – Anti-Dumping Measures on Certain Hot -
Rolled Steel from Turkey , WT/DS513/R  and Add.1, adopted 
8 January  2020; appeal withdrawn by Morocco as reflected in 
Appellate Body Report WT/DS513/AB/R  
Russia – Commercial 
Vehicles  Appellate Body Report,  Russia – Anti-Dumping Duties on Light 
Commercial Vehicles from Germany and Italy , WT/DS479/AB/R  and 
Add.1, adopted 9  April 2018 , DSR 2018:III, p. 1167  
Thailand – H-Beams  Appellate Body Report, Thailand – Anti-Dumping Duties on Angles, 
Shapes and Sections of Iron or Non -Alloy Steel and H -Beams from 
Poland , WT/DS122/AB/R , adopted 5  April 2001, DSR 2001:VII, 
p. 2701 WT/DS577/R  
BCI deleted, as indicated [[***]]  
- 10 - 
 
  Short Title  Full Case Title and Citation  
Thailand – H-Beams Panel Report, Thailand – Anti-Dumping Duties on Angles, Shapes and 
Sections of Iron or Non -Alloy Steel and H -Beams from Poland , 
WT/DS122/R , adopted 5  April 2001, as modified by Appellate Body 
Report WT/DS122/AB/R, DSR 2001:VII, p. 2741  
US – Anti-Dumping and 
Countervailing Duties 
(China)  Appellate Body Report, United  States – Definitive Anti -Dumping and 
Countervailing Duties on Certain Products from China , 
WT/DS379/AB/R , adopted 25  March  2011, DSR 2011:V, p. 2869  
US – Anti-Dumping and 
Countervailing Duties 
(China)  Panel Report, United  States – Definitive Anti -Dumping and 
Countervailing Duties on Certain Products from China , WT/DS379/R , 
adopted 25  March  2011, as modified by Appellate Body Report 
WT/DS379/AB/R, DSR 2011:VI, p. 3143  
US – Canadian Pork  GATT Panel Report, United  States – Countervailing Duties on Fresh, 
Chilled and Frozen Pork from Canada , DS7/R, adopted 11  July 1991, 
BISD 38S/30  
US – Carbon Steel  Appellate Body Report, United States – Countervailing Duties on 
Certain Corrosion -Resistant Carbon Steel Flat Products from Germany , 
WT/DS213/AB/R  and Corr.1, adopted 19  December  2002, DSR 
2002:IX, p. 3779  
US – Carbon Steel 
(India)  Appellate Body Report, United States – Countervailing Measures on 
Certain Hot -Rolled Carbon Steel Flat Products from India , 
WT/DS436/AB/R , adopted 19  December  2014, DSR 2014:V, p. 1727  
US – Carbon Steel 
(India) (Article  21.5 – 
India)  Panel Report, United  States – Countervailing Measures on Certain 
Hot-Rolled Carbon Steel Flat Products from India – Recourse to 
Article  21.5 of the DSU by India , WT/DS436/RW  and Add.1, circulated 
to WTO Members 15  November  2019 [appealed by the United  States 
18 December  2019] 
US – Certain EC 
Products  Appellate Body Report, United States – Import Measures on Certain 
Products from the European Communities , WT/DS165/AB/R , adopted 
10 January  2001, DSR 2001:I,  p. 373  
US – Coated Paper 
(Indonesia)  Panel Report, United States – Anti-Dumping and Countervailing 
Measures on Certain Coated Paper from Indonesia , WT/DS491/R  and 
Add.1, adopted 22  January  2018, DSR 2018:I, p. 273  
US – Continued 
Zeroing  Appellate Body Report, United States – Continued Existence and 
Application of Zeroing Methodology , WT/DS350/AB/R , adopted 
19 February  2009, DSR 2009:III, p. 1291  
US – COOL  Appellate Body Reports, United States – Certain Country of Origin 
Labelling (COOL) Requirements , WT/DS384/AB/R  / WT/DS386/AB/R , 
adopted 23  July 2012, DSR 2012:V, p. 2449  
US – Countervailing 
and Anti -Dumping 
Measures (China)  Appellate Body Report, United States – Countervailing and Anti -
Dumping Measures on Certain Products from China , WT/DS449/AB/R  
and Corr.1, adopted 22  July 2014, DSR 2014:VIII, p. 3027  
US – Countervailing 
Duty Investigation on 
DRAMS  Appellate Body Report, United States – Countervailing Duty 
Investigation on Dynamic Random Access Memory Semiconductors 
(DRAMS) from Korea , WT/DS296/AB/R , adopted 20  July 2005, DSR 
2005:XVI, p. 8131  
US – Countervailing 
Duty Investigation on 
DRAMS  Panel Report, United States – Countervailing Duty Investigation on 
Dynamic Random Access Memory Semiconductors (DRAMS) from 
Korea , WT/DS296/R , adopted 20  July 2005, as modified by 
Appellate  Body Report WT/DS296/AB/R, DSR 2005:XVII, p. 8243  
US – Countervailing 
Measures (China)  Appellate Body Report, United States – Countervailing Duty Measures 
on Certain Products from China , WT/DS437/AB/R , adopted 
16 January  2015, DSR 2015:I, p. 7  
US – Gasoline  Appellate Body Report, United States – Standards for Reformulated 
and Conventional Gasoline , WT/DS2/AB/R , adopted 20  May 1996, 
DSR 1996:I, p. 3  WT/DS 577/R  
BCI deleted, as indicated [[ ***]] 
- 11 - 
 
  Short Title  Full Case Title and Citation  
US – Hot-Rolled Steel  Appellate Body Report, United States – Anti-Dumping Measures on 
Certain Hot -Rolled Steel Products from Japan , WT/DS184/AB/R , 
adopted 23  August 2001, DSR 2001:X, p. 4697  
US – Lamb  Appellate Body Report, United States – Safeguard Measures on 
Imports of Fresh, Chilled or Frozen Lamb Meat from New Zealand and 
Australia , WT/DS177/AB/R , WT/DS178/AB/R , adopted 16  May 2001, 
DSR 2001:IX, p. 4051  
US – Large Civil 
Aircraft (2nd complaint)  Appellate Body Report, United States – Measures Affecting Trade in 
Large Civil Aircraft (Second Complaint) , WT/DS353/AB/R , adopted 
23 March  2012, DSR 2012:I, p. 7  
US – Line Pipe  Appellate Body Report, United States – Definitive Safeguard Measures 
on Imports of Circular Welded Carbon Quality Line Pipe from Korea , 
WT/DS202/AB/R , adopted 8  March  2002, DSR 2002:IV, p. 1403  
US – Offset Act (Byrd 
Amend ment)  Appellate Body Report, United States – Continued Dumping and 
Subsidy Offset Act of 2000 , WT/DS217/AB/R , WT/DS234/AB/R , 
adopted 27  January  2003, DSR 2003:I, p. 375  
US – Oil Country 
Tubular Goods Sunset 
Reviews  Appellate Body Report, United States – Sunset Reviews of 
Anti-Dumping Measures on Oil Country Tubular Goods from Argentina , 
WT/DS268/AB/R , adopted 17  December  2004, DSR 2004:VII, p. 3257  
US – Pipes and Tubes 
(Turkey)   
 Panel Report , United States – Countervailing Measures on Certain Pipe 
and Tube Products from Turkey , WT/DS523/R  and Add.1, circulated to 
WTO Members 18  December  2018 [appealed by the United  States 
25 January  2019 – the Division suspended its work on 
10 December  2019] 
US – Softwood Lumber 
IV Appellate Body Report, United States – Final Countervailing Duty 
Determination with Respect to Certain Softwood Lumber from Canada , 
WT/DS257/AB/R , adopted 17  February  2004, DSR 2004:II, p. 571  
US – Softwood Lumber 
IV Panel Report, United States – Final Countervailing Duty Determination 
with Respect to Certain Softwood Lumber from Canada , WT/DS257/R  
and Corr.1, adopted 17  February  2004, as modified by Appellate Body 
Report WT/DS257/AB/R, DSR 2004:II, p. 641  
US – Softwood Lumber 
VI (Article  21.5 – 
Canada)  Appellate Body Report, United States – Investigation of the 
International Trade Commission in Softwood Lumber from Canada – 
Recourse to Ar ticle 21.5 of the DSU by Canada , WT/DS277/AB/RW , 
adopted 9  May 2006, an d Corr.1, DSR 2006:XI, p. 4865  
US – Softwood Lumber 
VII Panel Report, United States – Countervailing Measures on Softwood 
Lumber from Canada , WT/DS533/R  and Add.1, circulated to 
WTO Members 24  August  2020 [appealed by th e United States 
28 September  2020] 
US – Supercalendered 
Paper Panel Report, United States – Countervailing Measures on 
Supercalendered Paper from Canada , WT/DS505/R  and Add.1, 
adopted 5  March  2020, as upheld by Appellate Body Report 
WT/DS505/AB/R  
US – Tuna II (Mexico)  Appellate Body Report, United States – Measures Concerning the 
Importation, Marketing and Sale of Tuna and Tuna Products , 
WT/DS381/AB/R , adopted 13  June 2012, DSR 2012:IV, p. 1837  
US – Upland Cotton  Appellate Body Report, United States – Subsidies on Upland Cotton , 
WT/DS267/AB/R , adopted 21  March  2005, DSR 2005:I, p. 3  
US – Upland Cotton  Panel Report, United States – Subsidies on Upland Cotton , 
WT/DS267/R , Add.1 to Add.3 and Corr.1, adopted 21  March  2005, as 
modified by Appellate Body Report WT/DS267/AB/R, DSR 2005:II, 
p. 299 WT/DS577/R  
BCI deleted, as indicated [[***]]  
- 12 - 
 
  Short Title  Full Case Title and Citation  
US – Washing 
Machines  Appellate Body Report,  United States – Anti-Dumping and 
Countervailing Measures on Large Residential Washers from Korea , 
WT/DS464/AB/R  and Add.1, adopted 26  September  2016, DSR 
2016:V, p. 2275  
US – Washing 
Machines  Panel Report, United States – Anti-Dumping and Countervailing 
Measures on Large Residential Washers from Korea , WT/DS464/R  and 
Add.1, adopted 26  September  2016, as modified by Appellate Body 
Report WT/DS464/AB/R, DSR 2016:V, p. 2505  
US – Wheat Gluten  Appellate Body Report, United States – Definitive Safeguard Measures 
on Imports of Wheat Gluten from the European Communities , 
WT/DS166/AB/R , adopted 19  January  2001, DSR 2001:II, p. 717  
US – Wool Shirts and 
Blouses  Appellate Body Report, United States – Measure Affecting Imports of 
Woven Wool Shirts and Blouses from India , WT/DS33/AB/R , adopted 
23 May 1997, and Corr.1, DSR 1997:I, p. 323  
US – Zeroing (Japan) 
(Article  21.5 – Japan)  Appellate Body Report, United States – Measures Relating to Zeroing 
and Sunset Reviews – Recourse to Article  21.5 of the DSU by Japan , 
WT/DS322/AB/RW , adopted 31  August  2009, DSR 2009:VIII, p. 3441  
 
 WT/DS 577/R  
BCI deleted, as indicated [[ ***]] 
- 13 - 
 
  EXHIBITS  REFERRED  TO IN THIS  REPORT  
Exhibit  Short Title (if any)  Description/Long title  
EU-1 PIDM Memorandum dated 20  November  2017 from 
J. Maeder to G. Taverman concerning the decision 
memorandum for the preliminary determination in 
the countervailing duty investigation of ripe olives 
from Spain  
EU-2 FIDM Memorandum dated 11  June 2018 from J. Maeder 
to G. Taverman concerning the issues and 
decision memorandum for the final determination 
in the countervailing duty investigation of ripe 
olives from Spain  
EU-5 Injury Determination  USITC, Ripe Olives from Spai n, Investigation 
Nos. 701-TA-582 and 701 -TA-1377 ( final), 
Publication 4805 (July  2018)  
EU-10 Notice of determinations  Ripe Olives from Spain: Determinations, 
investigation Nos. 701 -TA-582 and 731 -TA-1377 
(final), United  States Federal Register, Vol. 83, 
No. 147 (31  July 2018), p.  36966  
EU-14 Submission by the GOS in 
relation to the preliminary 
determination  Submission by the Government of Spain in 
relation to the preliminary determination 
(27 April 2018)  
EU-15 GOS's response to 
supplemental 
questionnaire of 
10 January  2017 Government of Spain's response to supplemental 
questionnaire (10  January  2017)  
EU-17 Agro Sevilla response to 
the sourcing questionnaire 
(public version)  Agro Sevilla Aceitunas S.Coop. And.'s response to 
the USDOC's questionnaire concerning sources of 
raw and ripe olives (14  August  2017) (public 
version)  
EU-18 EC internal convergence 
document  European Commission, "Direct payments: the 
Basic Payment Scheme from 2015 – Convergence 
of the value of payment Entitlements ( 'Internal 
Convergence')" (December  2015)  
EU-19 Royal Decree 1075/2014  Ministry of Agriculture, Food and Environment, 
Royal Decree No. 1075/2014 of 19  December, 
concerning implementation, starting on year 
2015, of direct payments to agriculture, farming 
and other aid schemes, as well as concerning 
management and control of direct payments and 
payments to rural development, Official Spanish 
Gazette, No. 307 (20  December  2014)  
EU-21 Order AAA/544/2015  Ministry of Agriculture, Food and Environment, 
Order AAA/544/2015, of March  30th, establishing 
the distribution coefficients to be used for 
calculation of the initial value of the basic 
payment rights to carry out the first assignment 
of rights in the 2015 campaign in the event that 
the fa rmer declares surface in more than one 
region, Official Spanish Gazette, No. 78, Section I 
(1 April 2015) pp.  27642 -27643  
EU-22 USDOC verification report: 
European Commission  Memorandum dated 2  April 2018 concerning the 
countervailing duty investigation: ripe olives from 
Spain – verification report: European Commission  
EU-23 Regulation 73/2009  Council Regulation (EC) No. 73/2009 of 
19 January  2009 establishing common rules for 
direct support schemes for farmers under the 
common agricultural policy and est ablishing 
certain support schemes for farmers, amending 
Regulations (EC) No. 1290/2005, (EC) 
No. 247/2006, (EC) No. 378/2007 and repealing WT/DS577/R  
BCI deleted, as indicated [[***]]  
- 14 - 
 
  Exhibit  Short Title (if any)  Description/Long title  
Regulation (EC) No. 1782/2003, Official Journal of 
the European  Union, L Series, No. 30 
(31 January  2009), p.  16 
EU-24 Regulation 1782/2003  Council Regulation (EC) No. 1782/2003 of 
29 September  2003 establishing common rules 
for direct support schemes under the common 
agricultural policy and establishing certain support 
schemes for farmers and amending Regulations 
(EEC) No. 2019/93, (EC) No.  1452/2001, (EC) 
No. 1453/2001, (EC) No.  1454/2001, (EC) 
1868/94, (EC) No. 1251/1999, (EC) No. 
1254/1999, (EC) No. 1673/2000, (EEC) No. 
2358/71 and (EC) No. 2529/2001, Official Journal 
of the European  Union, L Series,  No. 270 
(21 October  2003), p.  1 
EU-25 Regulation 1307/2013  Regulation (EU) No. 1307/2013 of the 
European  Parliament and of the Council of 
17 December  2013 establishing rules for direct 
payments to farmers under support schemes 
within the framework of the common agricultural 
policy and repealing Council Regulation (EC) 
No. 637/2008 and Council Regulation (EC) No. 
73/2009, Official Journal of the European  Union, 
L Series, No. 347 (20  December  2013), p. 608  
EU-26 Regulation 1638/98  Council R egulation (EC) No. 1638/98 of 
20 July 1998 amending Regulation No. 
136/66/EEC on the establishment of a common 
organi zation of the market in oils and fats, Official 
Journal of the European Communities, L Series, 
No. 210 (28  July 1998), p. 32  
EU-30 Royal D ecree 1076/2014  Ministry of Agriculture, Food and Environment, 
Royal Decree No. 1076/2014 of 19  December 
concerning allocation of basic payment scheme 
entitlements of the Common Agricultural Policy, 
Official Spanish Gazette, No.  307 
(20 December  2014)  
EU-31 Newsletter No.  2, Basic 
payment entitlement 
allocation  Newsletter No. 2, Basic payment entitlement 
allocation  
EU-32 Order AAA/1747/2016  Ministry of Agriculture, Food and Environment, 
Order AAA/1747/2016, of 26  October, 
establishing the final regional average values and 
the maximum number of basic payment rights, 
established by initial allocation, that characterize 
each of the regions of the regional 
implementation model for the basic payment 
scheme , Official Spanish Gazette, No. 268, 
Section  I (5 November  2016), p. 11361  
EU-34 Preliminary determination 
on injury  USITC, Ripe Olives from Spain, Investigation 
Nos. 701-TA-582 and 731 -TA-1377 (Preliminary), 
Publication  4718 (August  2017)  
EU-36 Aceitunas Guadalquivir 
preliminary determination  Memorandum dated 20  November  2017 
concerning the preliminary determination 
calculations for Aceitunas Guadalquivir, S.L.U.  
EU-37 Agro Sevilla preliminary 
determination  Memorandum dated 20  November  2017 
concerning the preliminary determinatio n 
calculations for Agro Sevilla Aceitunas S. Coop. 
And. 
EU-38 Ángel Camacho 
preliminary determination  Memorandum dated 20  November  2017 
concerning the preliminary determination 
calculations for Ángel Camacho Alimentación S.L.  WT/DS 577/R  
BCI deleted, as indicated [[ ***]] 
- 15 - 
 
  Exhibit  Short Title (if any)  Description/Long title  
EU-39 Agro Sevilla final 
determination  Memorandum dated 11  June 2018 concerning the 
final determination calculations for Agro Sevilla 
Aceitunas S.  Coop. And.  
EU-40 Ángel Camacho final 
determination  Memorandum dated 11  June 2018 concerning the 
final determination calculation s for Ángel 
Camacho Alimentación S.L.  
EU-41 Aceitunas Guadalquivir 
final determination  Memorandum dated 11  June 2018 concerning the 
final determination calculations for Aceitunas 
Guadalquivir, S.L.U.  
EU-42 (BCI)  Agro Sevilla response to 
the sourcing questionnaire  Agro Sevilla Aceitunas S.  Coop. And. response to 
the USDOC's questionnaire concerning sources of 
raw and ripe olives (14  August  2017)  
EU-43 (BCI)  Extract from Agro Sevilla 
final calculation data  Extract from Agro Sevilla Aceitunas S.  Coop. And. 
final calculation data, tab "AS  Sales" 
(11 June 2018)  
EU-44 (BCI)  Ángel Camacho response 
to the sourcing 
questionnaire  Ángel Camacho Alimentación, S.L.'s Olive 
sourcing questionnaire response 
(14 August  2017)  
EU-45 (BCI)  Extract f rom Ángel 
Camacho final calculation 
data Extract from Ángel Camacho Alimentación, S.L. 
final calculation data, tab SAIS suppliers 
(11 June 2018)  
EU-47 (BCI)  Extract from Aceitunas 
Guadalquivir final 
calculation data  Extract from Aceitunas Guadalquivir, S.L.U  final 
calculation data, tab BPS Growers (11  June 2018)  
EU-49 19 USC 1677 -1 United  States House of representatives, Office of 
the Law Revision Counsel, United  States Code, 
Title 19, Section 1677 -1, Upstream Subsidies  
EU-50 Asociación de 
Exportadores e 
Industriales de Mesa et al. 
v. United States  United States Court of International Trade, Slip 
Op. 20 -8, Asociaci ón de exportadores e 
industriales de Aceitunas de Mesa, Aceitunas 
Guadalquivir, S.L.U., Agro Sevilla Aceitunas S. 
Coop. And., and Ángel Camacho Alimentación, 
S.L. v. United  States (17  January  2020)  
EU-51 Frozen warmwater shrimp 
FIDM Memorandum dated 12  August  2013 concerning 
the final determination in the Countervailing Duty 
investigation of certain frozen warmwater shrimp 
from the People's Republic of China  
EU-52 19 USC 1677 -2  Calculation of countervailable subsidies on certain 
processed agricultural products, US House of 
representatives, Office of the Law Revision 
Counsel, United States Code, Title 19, 
Section  1677-2  
EU-58 Letter to Aceitunas 
Guadalquivir on 
questionnaire  Letter dated on 4  August  2017 from the USDOC 
to Aceitunas Guadalquivir, S.L.U., on 
questionnaire on sources of raw and ripe olives  
EU-59 Aceitunas Guadalquivir 
fourth supplemental 
questionnaire response  Fourth supplemental questionnaire response of 
Aceitunas Guadalquivir S.L.U., Narrative part 
(5 January  2018)  
EU-60 Letter from the USDOC on 
clarification  Letter dated 27  September  2017 from the USDOC 
on Ripe Olives from Spain countervailing duty 
investigation: clarification  
EU-61 Reporting template for 
processors of ripe olives  Reporting template for processors of ripe olives, 
attached to the questionnaire on sources of raw 
and ripe olives (4  August  2017)  
EU-62 Supplemental 
questionnaire to Aceitunas 
Guadalquivir  Countervailing Duty investigation of ripe olives 
from Spain: Supplemental questionnaire to 
Aceitunas Guadalquivir, S.L.U. 
(21 December  2017)  
EU-63 Aceitunas Guadalquivir  
response to the sourcing 
questionnaire  Aceitunas Guadalquivir, S.L.U. olive sourcing 
questionnaire response (14  August  2017)  WT/DS577/R  
BCI deleted, as indicated [[***]]  
- 16 - 
 
  Exhibit  Short Title (if any)  Description/Long title  
EU-64 (BCI)  Ángel Camacho revised 
olive sourcing data  Ángel Camacho Alimentación, S.L. revised olive 
sourcing data (6  October  2017)  
EU-65 (BCI)  Agro Sevilla revised olive 
sourcing data  Agro Sevilla Aceitunas S.  Coop. And. revised olive 
sourcing data (6  October  2017)  
EU-68 Ángel Camacho response 
to the sourcing 
questionnaire (public 
version)  Ángel Camacho Alimentación, S.L. Olive sourcing 
questionnaire response (14  August  2017)  
EU-69 Ministerial error 
memorandum  Memorandum dated 12  July 2018 on Ripe Olives 
from Spain: amended final determination of 
countervailing duty investigation pursuant to 
ministerial error allegation  
EU-71 (BCI)  Aceitunas Guadalquivir 
comments for the final 
determination  Aceitunas Guadalquivir S.L.U, Ministerial error 
comments for the final determination 
(18 June 2018)  
EU-76 Extract from Aceitunas 
Guadalquivir final 
calculation data, tab BPS 
Growers  Extract from Aceitunas Guadalquivir final 
calculation data , tab BPS Growers (11  June 2018)  
EU-77 19 USCFR 351.525  United States Code of Federal Regulations, 
Title 19, Section 351.525, Calculation of ad 
valorem subsidy rate and attribution of subsidy to 
a product  
EU-78 Ángel Camacho revised 
olive sourcing data (public 
version)  Ángel Camacho Alimentación, S.L. Revised Olive 
sourcing data (6 October  2017)  
EU-79 Agro Sevi lla revised olive 
sourcing data (public 
version)  Agro Sevilla Aceitunas S.  Coop. And. Revised 
Olive sourcing data (6 October  2017)  
EU-80 Remand Redetermination  USDOC, final results of Remand Redetermination, 
Asociación de Exportadores e Industriales de 
Aceitunas de Mesa, Aceitunas Guadalquivir, 
S.L.U., Agro Sevilla Aceitunas S. Coop. And., and 
Ángel Camacho Alimentación, S.L. v. 
United  States (29  May 2020)  
USA-4 Government of 
Spain's  prehearing brief Government of Spain's pre hearing  brief for the 
final phase in the investigation on ripe olives from 
Spain, Investigation Nos. 701 -TA-582 and 
731-TA-1377 (17  May 2018)  
USA-5 Report accompanying 
Government of 
Spain's  prehearing brief Government of Spain's report carried out by 
AGRIBUSINESS INTELLIGENCE -INFORMA for the 
final phase of the investigation on ripe olives from 
Spain, Investigation Nos. 701 -TA-582 and  
731-TA-1377 (17  May 2018)  
USA-6 Letter to Agro Sevilla on 
questionnaire  Letter dated 4  August  2017 from the USDOC to 
Agro Sevilla Aceitunas S. Coop. And. regarding 
questionnaire on sources of raw and ripe olives  
USA-7 Letter to Ángel Camacho 
on questionnaire  Letter dated 4  August  2017 from the USDOC to 
Ángel Camacho Alimentación, S.L. regarding 
questionnaire on sources of raw and ripe olives  
USA-9 Congressional record 
S8787 -01 133 Congressional record S8787 -01 
(26 June 1987)  
USA-14 Letter to Aceitunas 
Guadalquivir regarding 
questionnaire to 
unaffiliated suppliers  Letter dated 7  September  2017 from  the USDOC 
to Aceitunas Guadalquivir, S.L.U. regarding 
questionnaire to unaffiliated suppliers  
USA-18 Letter to Agro Sevilla 
regarding verification of 
questionnaire respon ses Letter dated 2  February  2018 from the USDOC to 
Agro Sevilla Aceitunas S. Coop. And regarding 
verification of questionnaire responses  WT/DS 577/R  
BCI deleted, as indicated [[ ***]] 
- 17 - 
 
  Exhibit  Short Title (if any)  Description/Long title  
USA-19 Letter to Ángel Camacho 
regarding verification of 
questionnaire responses  Letter dated 2  February  2018 from the USDOC to 
Ángel Camacho Alimentación S.L. regarding 
verification of questionnaire responses  
USA-20 Case brief of petitioner in 
Countervailing Duty 
Investigation of Ripe 
Olives from Spain 
(23 April 2018)  Case brief of petitioner in countervailing duty 
investigation of ripe olives from Spain 
(23 April 2018)  
USA-21 Letter to Aceitunas 
Guadalquivir regarding 
verification of 
questionnaire responses  Letter dated 9  February  2018 from the USDOC to 
Aceitunas Guadalquivir, S.L.U. regarding 
verification of questi onnaire responses  
USA-22 Aceitunas Guadalquivir 
verification report  Memorandum dated 22  March  2018 regarding the 
verification of the questionnaire responses of 
Aceitunas Guadalquivir, S.L.U.  
USA-24 Rebuttal brief  Rebuttal Brief of ASEMESA, Agro Sevilla Aceitunas 
S. Coop.  And., Ángel Camacho Alimentación, S.L., 
and Aceitunas Guadalquivir S.L.U. (8  May 2018)  
USA-29 Definition of "access" from 
The Oxford English 
Dictionary  Oxford Dictionaries online, definition of "access"  
USA-33 Commission Implem enting 
Regulation (EU) 2016/181  Commission Implementing Regulation (EU) 
2016/181 of 10  February  2016 imposing a 
provisional anti -dumping duty on imports of 
certain cold -rolled flat steel products originating 
in the People's Republic of China and the 
Russia n Federation, Official Journal of the 
European  Union, L Series, No. 37 
(12 February  2016), p. 1  
USA-34 Commission Regulation 
(EC) 896/2007  
 Commission Regulation (EC) No. 896/2007 of 
27 July 2007 imposing a provisional anti -dumping 
duty on imports of dihydromyrcenol originating in 
India, Official Journal of the European  Union, 
L Series, No. 196 (28  July 2007), p. 3  
USA-35 Commission Regulation 
(EC) 1611/2003  Commission Regulation (EC) No. 1611/2003 of 
15 September  2003 imposing provisional 
anti-dumpin g duties on imports of certain 
stainless steel cold -rolled flat products originating 
in the United States of America, Official Journal of 
the European  Union, L Series, No. 230 
(16 September  2003), p. 9  
 
 WT/DS577/R  
BCI deleted, as indicated [[***]]  
- 18 - 
 
  ABBREVIATIONS  USED  IN THIS  REPORT  
Abbreviation  Description  
Anti-Dumping  Agreement  Agreement on Implementation of Article  VI of the 
General  Agreement on Tariffs and Trade 1994  
Aceitunas Guadalquivir  Aceitunas Guadalquivir , S.L.U.  
Agro Sevilla  Agro Sevilla Aceitunas S. Coop. And.  
Ángel Camacho  Ángel Camacho Alimentación, S.L.  
BCI Business confidential information  
BPS Basic Payment Scheme – Direct Payment  
CAP Common Agricultural Policy  
COMOF  Common Organization of Markets in Oils and Fats 
DSB Dispute Settlement Body  
DSU Understanding on Rules and Procedures Governing the Settlement of 
Disputes  
GATT 1994  General  Agreement on Tariffs and Trade 1994  
GOS Government of Spain  
GP Basic Payment Scheme – Greening  
SCM Agreement  Agreement on Subsidies and Countervailing Measures  
SPS Single Payment Scheme  
USCIT  United  States Court of International Trade  
USDOC  United  States Department of Commerce  
USITC  United  States International T rade Commission  
Vienna Convention  Vienna Convention on the Law of Treaties, Done at Vienna, 
23 May 1969, 1155 UNTS 331; 8 International Legal Materials 679  
WTO World Trade Organization  
 WT/DS 577/R  
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  1  INTRODUCTION  
1.1  Complaint  by the European  Union  
1.1.  On 28 January  2019, the European  Union requested consultations with the United  States 
pursuant to Articles  1 and 4 of the Understanding on Rules and Procedures Governing the Settlement 
of Disputes (DSU), Article  30 of the  Agreement on Subsidies and Countervai ling Measures 
(SCM  Agreement), Article  17 of the  Agreement on Implementation of Article  VI of the 
General  Agreement on Tariffs and Trade 1994 (Anti -Dumping  Agreement),  and Article  XXIII of the 
General  Agreement on Tariffs and Trade 1994 (GATT 1994)  with re spect to the measures and claims 
set out below.1 
1.2.  Consultations were held on 20  March  2019 but failed to resolve the dispute.  
1.2  Panel  establishment  and composition  
1.3.  On 16  May 2019, the European  Union requested the establishment of a panel pursuant to 
Article  6 of the DSU with standard terms of reference.2 At its meeting on 24  June 2019, the Dispute 
Settlement Body (DSB)  established a panel pursuant to the request of the European  Union in 
document WT/DS 577/3 , in accordance with Article  6 of the DSU.3 
1.4.  The Pane l's terms of reference are the following:  
To examine, in the light of the relevant provisions of the covered agreements cited by 
the parties to the dispute, the matter referred to the DSB by the European  Union in 
document WT/DS577/3 and to make such findin gs as will assist the DSB in making the 
recommendations or in giving the rulings provided for in those agreements.4 
1.5.  On 8 October  2019, the European  Union requested the Director -General to determine the 
composition of the panel, pursuant to Article  8.7 of the DSU . On 18  October  2019, 
the Director -General accordingly composed the Panel as follows:  
Chairperson:  Mr Daniel Moulis  
 
Members:   Mr Martin Garcia  
   Ms Charis Tan  
 
1.6.  Australia, Brazil, Canada, China, India, Japan, Mexico, the Russian Fede ration,  
the Kingdom of Saudi Arabia, Switzerland , and Turkey  notified their interest in participating in the 
Panel proceedings as third parties.  
1.3  Panel  proceedings  
1.3.1   General  
1.7.  After consultation with the parties on 5  December  2019, the Panel adopted its 
Working  Procedures5, Additional Working Procedures on Business Confidential Information (BCI)6, 
and timetable  on 6 January  2020. The Panel revised its timetable  during the panel proceedings in 
light of subsequent developments.7 
1.8.  The European  Union  submitted its  first written submission on 27 January  2020, and the 
United  States  submitted its first written submission on 17 March  2020. On 26 March  2020,  the Panel 
 
1 Request for consultations by the European  Union , WT/DS577/1  (European  Union's  consultation 
request) . 
2 Request for the establishment of a panel by the European  Union , WT/DS577/3  
(European  Union's  panel request) . 
3 DSB, Minutes of the meeting held on 24  June 2019, WT/DSB/M/430.  
4 Constitution note of the Panel , WT/DS577/4.  
5 See Annex  A-1. 
6 See Annex  A-2. 
7 The time table was updated and revised on 13  January, 21  July, 29  October  2020, and 9 June 2021.  WT/DS577/R  
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  postponed the original dates for the first substantive meeting  due to the imposition of various 
restric tions on gatherings and international travel in relation to the COVID -19 pandemic. To facilitate 
its continued work on the dispute, on 18 May 2020 the Panel posed written questions to the parties 
and third parties concerning certain factual and legal issue s, pursuant to its authority under 
paragraph  9(1) of the Working Procedures of the Panel and Article  13 of the DSU. The Panel received 
the parties ' and certain third parties ' responses to these questions on 10 June 2020. On  
21 July 2020, the Panel requeste d the parties to comment on certain legal and factual issues raised 
by the parties'  10 June 2020 responses and received the parties'  comments on 8 September  2020. 
1.9.  In light of the continuation of the restrictions imposed on gatherings and international travel 
in relation to the COVID -19 pandemic, the Panel determined that it would still not be possible to 
hold the first substantive meeting  fully in person at the WTO pr emises within a reasonable 
timeframe. Accordingly, after several rounds of consultations with the parties, on  
18 September  2020 the Panel decided to hold the first substantive meeting virtually through the 
Cisco Webex platform , with the possibility for lim ited participation on the WTO  premises .8 The Panel 
decided to proceed in this manner after careful consideration of the circumstances at hand. Since it 
did not appear likely that the parties and the Panel would be able to meet in person  at the 
WTO premise s in the foreseeable future, the Panel considered that conducting the first substantive 
meeting virtually was a reasonable and secure alternative that would comply with the requirements 
of the DSU, preserve the parties ' due process rights, and avoid furthe r delay in the proceedings.9 
For the purpose of conducting the first substantive meeting, and after consulting with the parties, 
the Panel adopted Additional Working Procedures of the Panel Concerning Holding a  Substantive 
Meeting Conducted via Cisco Webe x on 9 October  2020.10 These procedures stipulated how the 
meeting would be conducted and set out certain technical and security requirements. In organizing 
the meeting , the Panel made its best effort s to accommodate the technological and logistical 
concer ns raised by the parties. The Panel held the first substantive meeting with the parties on 
19 and 22  October  2020. The third -party session of the first substantive meeting took place on 
20 October  2020. On 29 October  2020,  the Panel posed an additional set of written questions to the 
parties. The Panel received the parties ' responses to these questions on 12 November  2020. The 
parties submitted their second written submissions on 10 December  2020. 
1.10.   Due to the continuing restrictions imposed on gatherings and international travel in relation 
to the COVID -19 pandemic, the Panel further determined that it would not be possible to hold the 
second substantive meeting  in person within a reasonable timeframe. Therefore, after consultations 
with the par ties, the Panel decided to hold the second substantive meeting in a virtual format with 
the possibility for limited participation on the WTO  premises . For the purpose of this  meeting, after 
consulting with the parties, the Panel adopted Additional Working Procedures of the Panel Concerning 
Holding a Substantive Meeting Conducted via Cisco Webex  on 30 November  2020.11 In organizing 
the meeting , the Panel again made its best effort s to accommodate the technological and logistical 
concerns raised by the partie s. The Panel held its second substantive meeting with the parties on 
3 and 4  February  2021. On 11 February  2021, the Panel posed a further set of written questions to 
the parties. The Panel received the parties ' responses to these questions on 25 February  2021, and 
comments from the parties on these responses on 11 March  2021. The Panel posed a final set of 
written questions on 5  March  2021 and received responses on 26  March  2021, and comments on 
these responses on 13 April 2021.  
1.11.   At the request of the parti es, the Panel 's meetings with the  parties w ere opened to the public . 
Due to the continuing restrictions imposed on gatherings and international travel , and after 
 
8 The virtual  format allowed parties and third parties to participate in the meeting remotely through the 
Cisco Webex platform, while at the same time leaving  open the possibility for a limited number of delegates to 
attend the meeting on the WTO  premises.  
9 In this re gard, Article  3.3 of the DSU contemplates the prompt settlement of disputes while Article  12 
of the DSU provides panels with flexibility in terms of the procedures that govern the panel process.  The 
European  Union agreed that the Articles  12.1 and 12.2 of the DSU provide panels with flexibilities in terms of 
organising the panel process, provided that the principle of due process is respected. The United  States did not 
consider that the proposed virtual format would be adequate to protect the parties' right s under the DSU 
because, among other things, capital -based delegates could not attend in person, thus preventing the 
contemporaneous oral exchange of views  either amongst members of the delegation of the United  States, or 
with the Panel or the European  Union. 
10 See Annex  A-4. 
11 See Annex  A-5. WT/DS 577/R  
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  consulting with the parties, the Panel decided to webcast audio recordings of the meetings .12 
A portion of the Panel's  meeting with the third parties was also opened to the public.13 
1.12.   On 9 June 2021, the Panel issued the descriptive part of its Report to the parties. The Panel 
issued its Interim Report to the parties on 7 July 2021. On 19  August  2021, following a joint request 
by the parties, the Panel postponed the issuance of its final report until 16  September  2021. On 
16 September  2021, following an additional request by the parties, the Panel further postponed the 
issuance of its final report u ntil 3 November  2021.The Panel issued its Final Report to the parties on 
3 November  2021. 
1.3.2   Preliminary  ruling  on the Panel's  terms  of reference  
1.13.   With its first written submission on 17  March  2020, the United  States  requested a preliminary 
ruling pursuant to paragraph  4 of the Panel 's Working Procedures that claims under Article  15.4 of 
the SCM  Agreement  and Article  3.4 of the Anti -Dumping  Agreement  are outside the Panel 's terms 
of reference, because those claims were not identified in the European  Union's  request  for the 
establishment of a panel .14 
1.14.   At the Panel 's invitation, on 20  May 2020, the European  Union  submitted a written response 
to the United  States'  request for a preliminary ruling.15 
1.15.   On 18  September  2020, the Panel informed the parties of its decision to deny the 
United  States'  request.16 The Panel's  underlying reasoning in relation to the 
United  States'  preliminary ruling request is set out in section  7.4.1 below.  
1.3.3   Request  to address  certain  aspects  of the USDOC's Remand  Redetermination  of 
29 May 2020  
1.16.   On 2 July 2020, the European  Union  requested to address in its remaining submissions certain 
aspects of the Final Results of Remand Redetermination, Asociación de Exportadores e Industriales 
de Aceitunas de Mesa, Aceitunas Guadalquivir, S.L.U.  (Aceitunas Guadalquivir ), Agro  Sevilla 
Aceitunas S. Coop. And. (Agro  Sevilla) , and Ángel Camacho Alimentación, S.L.  (Ángel Camacho)  
v. United  States issued by the United  States Department of Commerce (USDOC)  on 29  May 2020 
(Remand Redetermination). The Remand Redetermination did not exist at the time of establis hment 
of the Panel . 
1.17.   At the Panel 's invitation, on 10  July 2020, the United  States  commented on the 
European  Union's  request.17 
1.18.   On 18  September  2020, the Panel informed the parties of its decision to grant the 
European  Union's  request .18 The Panel's  underlying reasoning in relation to the 
European  Union's  request is set out in section  7.2.1 below.  
2  FACTUAL  ASPECTS:  THE MEAS URES  AT ISSUE  
2.1.  The measures at issue in the present dispute concern countervailing and anti -dumping duties 
that the United  States imposed in connection with its investigations concerning  imports of ripe olives 
from Spain. In particular, the European  Union's  panel request refers to the following:  
a. Ripe Olives from Spain:  Amended Final Affirmative Countervailing Duty Determination and 
Countervailing Duty Order, 83 FR 37469, 1  August  2018;  
 
12 Additional Working Procedures of the Panel: Open Meetings (Delayed Online Broadcast) , Annex A -6. 
13 Canada  consented to having audio recordings of their statements shared with the public. The Panel 
also provided the audience  with written copies of the parties ' and Canada's statements, and written copies of 
the parties'  responses to the Panel's  questions at the  meeting.  
14 United  States'  first written submission, paras.  19-27. 
15 European  Union's  response to the United  States'  preliminary ruling  request . 
16 Panel 's communication of 18  September  2020, Annex  A-3. 
17 United  States'  response to the European  Union's  request (10  July 2020).  
18 Panel 's communication of 18  September  2020, Annex  A-3. WT/DS577/R  
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  b. Ripe Olives from Spain:  Antidumping Duty Order, 83 FR 37467, 1  August  2018; 
c. Ripe Olives from Spain:  Final Affirmative Countervailing Duty Determination, C -469-818, 
DOC, 11  June 2018, 83 FR 28186, 18  June 2018;  
d. Ripe Olives from Spain:  Final Affirmative Determination of Sales at Less Than Fair Value, 
A-469-817, DOC, 11  June 2018,  83 FR 28193, 18  June 2018; and  
e. Ripe Olives from Spain, Investigation Nos . 701-TA-582 and 731 -TA-1377 (Final), 
United  States International Trade Commission ( USITC ), Publication 4805,  July 2018. 
2.2.  The Panel also accepted the European  Union's  request19 to address certain aspects of the 
USDOC 's Remand  Redetermination of 29 May 2020, reflected in the following document:  
a. USDOC , Final Results of Remand Redetermination , Asociación de Exportadores e 
Industriales de Aceitunas de Mesa,  Aceitunas Guadalquivir, S.L.U., Agro Sevilla Aceitunas 
S. Coop. And., and Ángel Camacho Alimentación, S.L. v. United  States (29  May 2020).  
2.3.  The European  Union also challenges "as such" Section  771B of the Tariff Act of 1930 , relating 
to the calculation of countervailable subsidies on certain processed agricultural products.20 
3  PARTIES'  REQUESTS  FOR FINDINGS  AND RECOMMENDATIONS  
3.1.  The European  Union requests the Panel to find that the USDOC and the USITC acted 
inconsistently with the United  States'  obligations under the Anti-Dumping  Agreement, the 
SCM Agreement,  and the  GATT  1994.  
3.2.  With respect to the USDOC's  determination of de jure specificity , the European  Union  claims  
that the USDOC acted inconsistentl y with : 
a. Articles  2.1, 2.1(a), and 2.4 of the SCM  Agreement  by failing to examine the eligibility 
conditions governing the Single Payment Scheme (SPS), Basic Payment Scheme – Direct 
Payment (BPS), and Basic Payment Scheme – Greening (GP ) programmes and to 
demonstrate that those conditions explicitly limited access to the subsidy to certain 
enterprises21; 
b. Articles  2.1, 2.1(a), and 2.4 of the SCM  Agreement  by finding that the SPS, BPS, and 
GP programmes are de jure specific because the  assistance provided to o live growers was 
tied to the production of olives22; 
c. Articles  2.1, 2.1(a), and 2.4 of the SCM  Agreement  by grounding its de jure specificity 
analysis on the  Common Organization of Markets in Oils and Fats (COMOF ) programme , 
which was no longer in force,  and building a link between that programme and the amount 
of assistance provided under the BPS and GP  programmes , when the record evidence 
demonstrated no direct correlation between the current and past programmes23; 
d. Articles  2.1, 2.1(b), and 2.4 of  the SCM  Agreement  by failing to analyse whether the 
criteria governing the eligibility for, and the amount of,  the SPS, BPS, and GP programmes 
complied with the requirements of Article  2.1(b ) of the SCM  Agreement24; 
 
19 See section  1.3.3 above.  
20 Section  771B is codified in 19 USC 1677 -2, (Exhibit  EU-52). 
21 European  Union's  first written submission, paras.  208-209. 
22 European  Union's  first written submission, para.  227. 
23 European  Union's  first written submission, paras.  240 and 246.  
24 European  Union's  first written submission, paras.  279-280. WT/DS 577/R  
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  e. Articles  2.1, 2.1(a), 2.1(b), and 2.4 o f the SCM  Agreement  by failing to base its de jure 
specificity findings on positive evidence and to provide reasoned and adequate 
explanations for those findings25; and 
f. Article  1.2 of the SCM  Agreement  by determining that the BPS and GP programmes are 
countervailable subsidies and subjecting them to Part V of the SCM  Agreement  without 
properly demonstrating that they were specific .26 
3.3.  With respect to the USDOC's  determinations attributing subsidies granted to raw olive growers 
to ripe olive processors, the E uropean  Union  claims  that the USDOC acted inconsistently with : 
a. Article  VI:3 of the  GATT  1994 and Articles  10, 19.1, 19.3, 19.4 , and 32.1 of the 
SCM Agreement  by failing to carry out a pass -through analysis for relevant  arm's length 
transactions for the ripe olive processors  under investigation,  and imposing countervailing 
duties that  went beyond offsetting the subsidy amount and  were neither appropriate nor 
accurately determined27; and 
b. Article  VI:3 of the  GATT  1994 and Article s 10, 19.1, 19.3, 19.4 , and 32.1 of the 
SCM Agreement  "as such ", because Section  771B requires the USDOC to impose a 
countervailing duty on a processed agricultural product in the absence of an analysis  of 
whether and to what extent any benefit passed -through from the raw input product, 
thereby mandating an approach that goes beyond offsetting a subsidy and in which the 
USDOC is unable to ensure an appropriate duty amount in each case or an accurate duty 
amount .28 
3.4.  With respect to the USITC's  injury determin ation, the European  Union  claims  that the US ITC 
acted inconsistently with : 
a. Articles  15.1 and 15.2 of the SCM  Agreement , and Articles  3.1 and 3.2 of the 
Anti-Dumping  Agreement , by undertaking an analysis of the volume of ripe olives from 
Spain that was not objective and not based on positive evidence . In particular, because 
the USITC:  
i. based its analysis on an artificial market "segmentation" of the domestic industry that 
was not explained, meaningless and arbitrary and in contradiction to the USITC 's own 
determinations29; 
ii. only consider ed "volume effects" in the artificial retail "segment" and n either  for the 
industry as a whole  nor for the two other "segments "30; and 
iii. improperly extend ed conclusions concerning the "volume effect" in the retail 
"segment" to the domestic industry as a whole without any evidentiary basis .31 
b. Articles  15.1 and 15.2 of the SCM  Agreement , and Articles  3.1 and 3.2 of the 
Anti-Dumping  Agreement , because the USITC did not consider a "volume effect" within 
the meaning of Article  15.2 of the SCM  Agreement and Article  3.2 of the 
Anti-Dumping  Agreement32; 
c. Articles  15.1 and 15.2 of the SCM  Agreement , and Articles  3.1 and 3.2 of the 
Anti-Dumping  Agreem ent, by undertaking an analysis of the price effects of ripe olives 
from Spain that was not objective and not based on positive evidence . In particular, 
because the USITC:  
 
25 European  Union's  first written submission, para.  329. 
26 European  Union's  first written submission, para.  330. 
27 European  Union's  first written submission, para.  386. 
28 European  Union's  first written submission, paras.  419-421. 
29 European  Union's  first written submission , paras.  465 and 492. 
30 European  Union's  first written submission , paras.  465 and 511. 
31 European  Union's  first wri tten submission , paras.  465 and 517. 
32 European  Union's  first written submission , paras.  465 and 525. WT/DS577/R  
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  i. based  the analysis of the price effects of ripe olives from Spain on an artificial m arket 
"segmentation" of the domestic industry that was meaningless, arbitrary , and in 
contradiction to the USITC 's own determinations33; 
ii. only consider ed price effects in the retail "segment" and not at the level of the domestic 
industry as a whole34; 
iii. improperly extend ed its conclusions concerning the consideration of price effects in 
the retail "segment" to the domestic industry as a whole35; and 
iv. concluded, without supporting evidence,  that underselling by subject imports resulted 
in a loss of market share in the retail sector by the domestic industry .36 
d. Articles  15.4 and 15.5 of the SCM  Agreement , and Articles  3.4 and 3.5 of the 
Anti-Dumping  Agreement , as a consequence of each of the above alleged violations 
concerning the USITC 's volume analysis and price effects analysis37; 
e. Articles  15.1 and 15.4 of the SCM  Agreement , and Articles  3.1 and 3.4 of the 
Anti-Dumping  Agreement , by undertaking an analysis of the consequent impact of ripe 
olives from Spain on the domestic industry that was not objective and  not based on 
positive evidence .38 In particular, because the USITC:  
i. carried out its impact analysis with respect to the retail "segment", and neither with 
respect to the industry as a whole , nor with respect to the two other "segments "39; 
ii. failed  to find a  "volume effect" in its volume analysis that could have had a 
"consequent" impact on the domestic industry40; 
iii. failed  to find a price effect with respect to the industry as a whole that could have had 
a "consequent" impact on the domestic industry41; 
iv. improp erly extend ed the impact finding for "volume effects" in the retail "segment" to 
the industry as a whole without any evidentiary basis42; and 
v. improperly extend ed the impact finding for " price effects" in the retail "segment" to 
the industry as a whole with out any evidentiary basis .43 
f. Article  15.5 of the SCM  Agreement , and Article  3.5 of the Anti -Dumping  Agreement , as a 
consequence of each of the above alleged violations concerning the USITC 's impact 
analysis44; 
 
33 European  Union's  first written submission , paras.  531 and 538. 
34 European  Union's  first written submission , paras.  531 and 550. 
35 European  Union's  first written submission , paras.  531 and 556. 
36 European  Union's  first written submission, para. 543; second written submission,  para. 157. This 
argument is not presented in a separate  section of the European  Union's  first and second writt en submissions, 
as are the European  Union's  other arguments. The European  Union confirmed , however, in response to 
questions from the Panel , that this was a distinct claim. (European  Union's  25 February  2021 response to Panel 
question  No. 15, para. 106). 
37 In relation to the USITC 's volume analysis, see European  Union's  first written submission , paras.  493, 
512, 518, 560, 564, 600, and 610. In relation to the USITC's  price effects analysis, see ibid. paras.  539, 551, 
557, 560, 564, 600, and 610.  
38 As noted above, the Panel denied the United  States'  request for a preliminary ruling that the 
European  Union's  claims under Article  15.4 of the SCM  Agreement  and Article  3.4 of the 
Anti-Dumping  Agreement  are outside the Panel 's terms of reference . (See section  1.3.2 above).  
39 European  Union's  first written submission, paras.  560 and 572. 
40 European  Union's  first written submission, paras.  560 and 581. 
41 European  Union's  first written submission, paras.  560 and 588. 
42 European  Union's  first written submission, paras.  560 and 592. 
43 European  Union's  first written submission, paras.  560 and 595 -596. 
44 European  Union's  first written submission, paras.  565, 57 3, 582, 589, 593, 597, 600, and 610.  WT/DS 577/R  
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  g. Articles  15.1 and 15.5 of the SCM  Agreement , and Articles  3.1 and 3.5 of the 
Anti-Dumping  Agreement , by undertaking a causation analysis that was not objective and 
not based on positive evidence . In particular, because the USITC:  
i. failed to carry out a causation assessment with respect to the domestic industry as a 
whole45; and 
ii. failed  to separate and distinguish the injurious effects of the contraction of US demand 
and of non -subject imports from the injurious effects of Spanish imports .46 
3.5.  With respect to the calculation of the subsidy and countervailing duty rate  for mandatory 
respondent Aceitunas  Guadalquivir, the European  Union  claims that the USDOC acted inconsistently 
with: 
a. Article  VI:3 of the  GATT  1994 and Articles  10, 19.1, 19.3, 19 .4, and 32.1 of the 
SCM Agreement by basing the calculation of the amount of subsidy and the countervailing 
duty rate on Aceitunas Guadalquivir 's overall purchases of raw olives, rather than on 
Aceitunas  Guadalquivir's  purchases of raw olives processed int o ripe olives47; 
b. Article  12.1 of the SCM  Agreement  by failing to notify Aceitunas  Guadalquivir  that the 
USDOC required information regarding the respondent's  volume of purchases of raw olives 
that were processed into ripe olives, which would be used in the  determination of 
Aceitunas  Guadalquivir 's final subsidy rate48; 
c. Article  12.8 of the SCM  Agreement by failing to disclose to Aceitunas  Guadalquivir , before 
making a final determination , that the volume of purchases of raw olives processed into 
ripe olives was an essential fact under consideration49; and  
d. Article  VI:3 of the  GATT  1994 and Articles  10, 19.1, 19.3, 19.4 , and 32.1 of the 
SCM Agreement by calculating the "all others " rate of countervailing duties imposed on 
exporters of olives that are not individually investigated, based in part on the calculation 
of the amount of subsidy for Aceitunas  Guadalquivir.50 
3.6.  The European  Union further requests, pursuant to Article  19.1 of t he DSU, that the Panel 
recommend that the United  States bring its measures into conformity with its WTO obligations.  
3.7.  The United  States requests that the Panel reject the European  Union's  claims in this dispute in 
their entirety.51 
4  ARGUMENTS  OF THE PARTIES  
4.1.  The arguments of the parties are reflected in their executive summaries, provided to the Panel 
in accordance with paragraph  23 of the  Working Procedures adopted by the Panel (see Annexes  B-1 
and B -2). 
5  ARGUMENTS  OF THE THIRD  PARTIES  
5.1.  The arguments of Brazil,  Canada, Japan, Mexico, and Turkey are reflected in  their executive 
summaries, provided in accordance with paragraph  26 of  the Working Procedures adopted by the 
Panel (see Annexes  C-1 to C-5). Australia, China, India, the Russian Federation,  
the Kingdom of  Saudi Arabia, and Switzerland did not submit written or oral arguments to the Panel.  
 
45 European  Union's  first written submission, paras.  600 and 615. 
46 European  Union's  first written submission, paras.  600 and 638. 
47 European  Union's  first written submission, paras.  666 and 706 -711. 
48 European  Union's  first written submission, paras.  712 and 716 -718. 
49 European  Union's  first written submission, paras.  724 and 728.  
50 European  Union's  first written submission, para.  730. 
51 United  States'  first written submission, para . 337. WT/DS577/R  
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  6  INTERIM  REVIEW  
6.1.  On 7 July 2021, the Panel issued its Interim Report to the parties. On 21 July 2021, the 
European  Union and the United  States submitted their written reque sts for review. On 28 July 2021, 
the parties submitted comments on the other parties'  written requests for review.  
6.2.  The parties'  requests made at the interim review stage as well as the Panel's  discussion and 
disposition of those requests are set out in Ann ex A-7. 
7  FINDINGS  
7.1  General principles regarding treaty interpretation, the applicable standard of review , 
and burden of proof  
7.1.1   Treaty interpretation  
7.1.  Article  3.2 of the DSU provides that the dispute settlement system serves to clarify the existing 
provisions of the covered  Agreement s "in accordance with customary rules of interpretation of public 
international law". It is generally accepted that the principles codified in Articles  31 and 32 of the 
Vienna Convention are such customary rules.52 
7.2.  Article 17.6(ii) of the Anti -Dumping  Agreement also provides that if a panel finds that a 
provision of the Anti -Dumping  Agreement admits of more than one permissible interpretation, it 
shall uphold a measure that rests upon one of those interpretations.  
7.1.2   Standard  of review  
7.3.  This dispute concerns claims raised by the European  Union under  the GATT  1994, the 
SCM Agreement , and the Anti -Dumping  Agreement . Article  11 of the DSU sets out a general 
standard of review for panels, providing, in relevant part, that : 
[A] pane l should make an objective assessment of the matter before it, including an 
objective assessment of the facts of the case and the applicability of and conformity 
with the relevant covered  Agreements.  
7.4.  The obligation to conduct an "objective assessment" has been found to require panels to 
evaluate whether the competent authorities provided a "reasoned and adequate explanation" as 
to (a) how the evidence on the record supported its factual findings; and (b) how those factual 
findings supported the overall dete rmination.53 Panels and the Appellate  Body have understood this 
standard to mean that a panel  may not undertake a de novo review of the evidence or substitute its 
judgment for that of the investigating authority. A panel must limit its examination to the e vidence 
that was before the investigating  authority during the investigation and must consider all such 
evidence submitted by the parties to the dispute.54 At the same time, a panel must not simply defer 
to the conclusions of the investigating authority; a  panel's  examination of those conclusions must 
be "in -depth" and "critical and searching".55 We agree with these findings, and do not understand 
the parties to take a different view.  
 
52 Appellate  Body Report, Japan  – Alcoholic  Beverages  II, DSR 1996:1, p.  104. 
53 Appellate  Body Report s, US – Countervailing  Duty Investigation  on DRAMS , para. 186; US – Lamb , 
para. 103. 
54 Appellate  Body Report, US – Countervailing  Duty Investigation  on DRAMS , paras.  187-188. See also 
Panel Reports,  US – Softwood  Lumber  VII, para.  7.5; US – Pipes and Tubes (Turkey) , para.  7.4; US – Coated  
Paper  (Indonesia) , para.  7.7; US – Washing  Machines , para.  7.5; China  – Autos  (US), para.  7.5; 
China  – Broiler  Products , para.  7.5; and China  – GOES , para.  7.4. 
55 Appellate  Body Reports, US – Softwood  Lumber  VI (Article  21.5 – Canada) , para.  93; US – Lamb , 
paras.  106-107. See also Panel Reports,  US – Softwood  Lumber  VII, para.  7.4; US – Pipes and Tubes (Turkey) , 
para. 7.4; US – Coated  Paper  (Indonesia) , para.  7.7; US – Washing  Machines , para.  7.5; China  – Autos  (US), 
para. 7.5; China  – Broiler  Products , para. 7.5; and China  – GOES , para. 7.4. WT/DS 577/R  
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  7.5.  In addition to the obligation to conduct an objective assessment under Ar ticle 11 of the DSU, 
in disputes  concerning anti -dumping measures , Article  17.6(i) of the Anti -Dumping  Agreement 
provides that:  
[I]n 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 evalua tion shall not be overturned [.] 
7.6.  Although the SCM  Agreement does not contain a similar provision, Members have declared that 
disputes arising from anti -dumping and countervailing duty measures should be resolved in a 
consistent manner.56 Likewise, the parti es have argued that the Panel should apply a consistent 
approach in resolving the claims at issue in this dispute, arguing, furthermore, that there is no 
conflict between Article  17.6(i) of the Anti -Dumping  Agreement and Article  11 of the DSU.57 
We share t he parties' views about the absence of conflict between Article  11 of the DSU and 
Article  17.6(i) of the Anti -Dumping  Agreement, and we will conduct our review of the merits of the 
European  Union's  claims accordingly.  
7.1.3   Burden of proof  
7.7.  The general principles  applicable to the allocation of the burden of proof in WTO dispute 
settlement require that a party claiming a violation of a provision of a WTO  Agreement must assert 
and prove its claim .58 Therefore, the European  Union bears the burden of demonstrating th at the 
challenged measures are inconsistent with the GATT 1994, the SCM  Agreement, and the 
Anti-Dumping  Agreement. A complaining party will satisfy its burden when it establishes 
a prima  facie case, namely a case which, without effective refutation by the defending party, 
requires a panel as a matter of law to rule in favour of the complaining party.59 Each party asserting 
a fact should  provide proof thereof.60 
7.2  The European  Union's  claims concerning the USDOC's de jure specificity findings in 
the ripe olives countervailing duty investigation  
7.2.1   The European  Union's  request  to address  the USDOC 's Remand  Redetermination  as 
it relates  to its original  de jure specificity  findings  
7.8.  As part of  the judicial review proceedings in the United  States Court of Internat ional Trade 
(USCIT ), the USDOC 's original determination of de jure specificity in the ripe olives countervailing 
duty investigation was remanded to the USDOC to conduct "further proceedings" and address the 
USCIT 's opinion that the USDOC 's findings had "not been sufficiently explained because  [the 
USDOC]  did not provide an interpretation of the statute in reaching its determination based on the 
record".61 In the  Remand Redetermination,  the USDOC "further explain[ed] its interpretation of 
section 771(5A)(D)(i) of the [Tariff Act of 1930] for the de jure  specificity finding",  "affirm[ed] the 
finding that [the USDOC] made in the Final Determination  that the BPS provides benefits that are 
de jure  specific to olive growers", and "made no change s to the A mended Final Determination and 
Countervailing Duty Order  with this [remand ] redetermination" .62 The Remand Redetermination  was 
issued on 29  May 2020, after the establishment of the Panel in this proceeding.63 
 
56 Declaration on Dispute Settlement Pursuant to the  Agreement on Implementation of Article  VI of the 
General  Agreement on Tariffs and Trade 1994 or Part V of the  Agreement on Subsidies and Countervailing 
Measures.  
57 European  Union's  8 September  2020 response to Panel question No.  5(a), para.  167; 
United  States'  8 September  2020 response to Panel question No.  5(a), para.  60. 
58 Appellate  Body Report, US – Wool Shirts  and Blouses , DSR 1997:1, p.  337. 
59 Appellate  Body Report, EC – Hormones , para. 104. 
60 Appellate  Body Report, US – Wool Shirts  and Blouses , DSR 1997:1, p.  335. 
61 Remand Redetermination,  (Exhibit  EU-80), pp.  1-2. 
62 Remand Redetermination,  (Exhibit  EU-80), pp. 2 and 50. (emphasis original)  
63 On 18  June 2021, the European  Union informed the Panel of a USCIT remand decision of 
17 June 2021 in connection with the USDOC's finding of de jure specificity  contained in the Remand 
Redetermination , submitting the 17  June 2021 remand decision as Exhibit  EU-81. After hearing the 
 WT/DS577/R  
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  7.9.  In a letter of 2  July 2020, the European  Union  requested the Panel  to grant it permission to 
address in its submissions the USDOC 's Remand Redetermination, as it related to the 
USDOC's  original findings of de jure specificity. The European  Union  argue s that it is entitled to 
address the Remand  Redetermination  because : (a) the terms of its panel request are broad enough 
to bring it within the scope of the P anel's terms of reference ; (b) the Remand Redetermination does 
not change the essence of the original measures identified i n its panel request ; and (c) consideration 
of the Remand Redetermination is necessary to secure a positive resolution to the dispute.64 
7.10.   The United  States maintains that the European  Union has failed to explain how its panel 
request should be understood to encompass the USDOC's  Remand Redetermination  as a measure 
at issue. Although the European  Union's  panel request refers to  "any amendments, supplements, 
extensions, replacement measures, renewal measures and implementing measures", the 
United  States argues that the European  Union does not explain in what way the 
Remand  Redetermination amends, supplements, extends, renews, or implements the measures at 
issue. The United  States further contends that the European  Union does not  identify why that 
additional expl anation contained in the Remand Redetermination  does not constitute a changed, 
different measure, and  that the  European  Union has also not demonstrated  how a failure to make 
findings on  the Remand Redetermination would undermine any findings and recommenda tion made 
in relation to the original  measures in existence at the time of the Panel's establishment.65  
7.11.   A panel 's terms of reference are defined by Articles  6.2 and 7.1 of the DSU.  Pursuant to 
Article  7.1, a panel must "examine … the matter referred to the DSB" in the complaining 
party's  panel request and "make such findings as will assist the DSB in making the recommendations 
or in giving the rulings provided for" in the covered agr eements identified in the complaining 
party's  panel request. In turn, Article  6.2 stipulates that a panel request must, inter alia, identify 
the specific measures at issue  and provide a brief summary of the legal basis of the complaint .66 
These requirement s together  constitute the "matter referred to the DSB" and form the basis of a 
panel 's terms of reference under Article  7.1 of the DSU.67 
7.12.   We agree with previous panel and Appellate  Body reports  that Article  6.2 of the DSU does not 
categorically preclude  the inclusion within a panel 's terms of reference of measures that come into 
existence after the panel  establishment  is requested .68 Rather, there may be circumstances in which 
it is necessary for a Panel to review measures enacted after its establishment so that it can make 
the findings and recommendations necessary to resolve the matter in dispute. This may include, for 
example, a measure that  amends a measure that is explicitly identified  in a panel request , without 
changing the essence of that original me asure .69 
7.13.   The Remand  Redetermination is not expressly identified  in the text of the 
European  Union's  panel request , since it did not exist at the time that the European  Union  filed its 
panel request . The European  Union's  panel request identifies , inter alia, the following measures, 
which were in existence at the relevant time:  
[Countervailing]  and [Anti-Dumping]  duty orders issued on 1  August  2018 by the 
US Department of Commerce ( [US]DOC) and applicable as from the same date, 
following final determinati ons by the [US]DOC and by the US International Trade 
Commission (ITC) [.]70 
 
parties'  views, the Panel informed the parties of its decision not t o accept the European  Union's  submission of 
Exhibit  EU-81, because of the Panel's view that there was insufficient cause to do so under paragraph  5(1) of 
the Panel's  Working Procedures, and because of the lateness of the European  Union's  submission and the  
imminent planned issuance of the interim report. (Panel 's communication s of 24 June 2021 and 29  June 2021). 
64 European  Union's  letter of 2  July 2020,  pp. 1-2. 
65 United  States'  letter of 10  July 2020, paras.  8-11. 
66 Appellate  Body Report, US – Carbon  Steel, para. 125. 
67 Appellate  Body Report, Guatemala  – Cement  I, para. 72. 
68 Appellate  Body Report s, US – Zeroing  (Japan ) (Article  21.5 – Japan) , paras.  121 and 125; EC – 
Chicken  Cuts, paras.  156-159; and Chile – Price Band System , paras.  126-144; Panel Report, US – Washing  
Machines , paras.  7.248-7.249.  
69 Appellate  Body Report s, Chile – Price Band System , paras.  126-144; EC – Chicken  Cuts, 
paras.  156-159. 
70 European  Union's  panel request , p. 1. (fns omitted)  WT/DS 577/R  
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  7.14.   We note, however, that the European  Union's  panel request also refers to "any amendments, 
supplements, extensions, replacement measures, renewal measures and implementing measures ".71 
In our view, these terms  are sufficiently broad to cover the challenged aspect of the 
Remand  Redetermination  because we consider the USDOC's  Remand Redetermination supplements 
and reaffirms its original de jure specificity findings . In this regard, we note that the 
USDOC's  analytical approach to the question of specificity in the Remand Redetermination remains 
fundamentally unchanged and its findings and analysis are not based on any new evidence 
introduced during the remand proceeding.72 The USDOC's  Remand Redetermination does not modify 
the USDOC's  original findings and does not alter the essence of the reasoning set out in the 
preliminary and final issues and decision memoranda. In these circumstances, we consider that the 
Remand Redetermination is covered by  our terms of reference, despite not existing  at the time that 
this Panel was established . In addition, we share the European  Union's  view that given its close 
connection with the original findings, our consideration of the European  Union's  submissions with 
respect to the Remand Redetermination would assist the resolution of the specific claims in this 
dispute.  
7.15.   For these reasons, we decided to gra nt the European  Union's  request to address in its 
submissions the USDOC's 29  May 2020 Remand Redetermination with respect to the matter of 
de jure specificity, on the basis that the Remand Redetermination is a measure or is part of the 
measure that is befo re the Panel in this dispute.  
7.2.2   The European  Union's  claims  under  Articles  2.1, 2.1(a ), and 2.4 of the 
SCM Agreement  
7.2.2.1   Introduction  
7.16.   In its preliminary and final issues and decision memoranda, the USDOC found that subsidies 
provided to olive growers under the European  Union's  Common Agricultural Policy  (CAP)  Pillar I , the 
BPS and GP programme s, as implemented by the Government of Spain (GOS), were de jure 
specific.73 The USDOC 's determinations were grounded in its understanding of the subsidy  
calculation  rules under  the BPS . The USDOC found  these rules  expressly referred to and incorporated 
the criteria used to determine subsidy  amounts  under two predecessor programmes  – the SPS a nd 
COMOF programmes, with the latter being considered to have provided crop -specific subsidies to 
olive growers .74 The USDOC found that under the BPS  programme , subsidy amounts for eligible 
farmers were determined based upon amounts of assistance received by olive growers under the 
predecessor SPS  programme ; and , in turn,  that subsidy amounts provided under the 
SPS programme  were based upon amounts of assistance received by olive growers under the 
COMOF  programme, which the USDOC characterized as a programm e that provided 
production -based de jure specific subsidies to olive growers. In short, the USDOC found that the 
subsidies provided to olive growers under the BPS and GP  programmes75 were de jure specific 
because the subsidy calculation rules resulted in a nnual grant amounts that were directly related to, 
and continued to retain, the de jure specificity of the grants provided to olive growers under the 
COMOF programme .76 The USDOC further explained  and elaborated  upon its original findings in the 
Remand Redetermination , and affirmed the finding that the BPS and GP programmes provided 
benefits that were de jure  specific to olive growers . 
 
71 European  Union's  panel request , p. 2. 
72 The USDOC's Remand Redetermination concerning its original de jure specificity findings is discussed 
in detail below.  
73 PIDM, ( Exhibit  EU-1), pp. 24-25; FIDM, ( Exhibit  EU-2), p. 36. 
74 PIDM, (Exhibit  EU-1), pp.  23-27; FIDM, (Exhibit  EU-2), pp.  32-36; and Remand Redetermination, 
(Exhibit  EU-80), pp.  48-50. 
75 In analysing the GP  programme, the USDOC considered that "a farmer who is entitled to a grant 
under the [BPS  programme] is eligible for [GP] grants if the farmer undertakes agricultural practices beneficial 
for the climate and the environment"; that farmers of permanent crops (such as olives) are entitled to the 
GP programme "ipso facto"; and that "[t]he grant amount [under the GP  programme] is a ratio estab lished 
annually by the national authority and the ratio is usually 50  percent of the [BPS] grant amount". ( PIDM, 
(Exhibit EU -1), p.  25). In light of these considerations , we understand the USDOC's findings concerning the 
GP programme are linked to and depe ndent upon its findings concerning the BPS programme, so we will assess 
the USDOC's de jure specificity findings accordingly.  
76 FIDM, (Exhibit  EU-2), p.  36. WT/DS577/R  
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  7.17.   The European  Union  claims that the USDOC 's de jure specificity findings  with respec t to the 
BPS programme , and consequently also the GP  programme , are inconsistent with the 
United  States'  obligations under Articles  2.1, 2.1(a ), and 2.4 of the SCM  Agreement . According to 
the European  Union , the USDOC 's finding of de jure specificity in re lation to the BPS  and 
GP programme s is inconsistent with Articles  2.1, 2.1(a) , and 2.4 of the SCM  Agreement  because, in 
its view, the key determinant of whether "access" to a subsidy is explicitly limited to certain 
enterprises, within the meaning of Article 2.1(a) , is a programme 's eligibility  criteria  (which the 
USDOC allegedly did not examine in establishing specificity of the SPS, BPS, and GP  programmes ), 
not the formula applied to calculate the amounts of subsidy available to eligible enterprises.  
7.18.   The European  Union also  claims that the USDOC 's determination is inconsistent with 
Articles  2.1, 2.1(a ), and 2.4  of the SCM Agreement  because the USDOC wrongly concluded that the 
BPS programme  retained the de jure specificity of olive -grower -specific subsidies bestowed under 
the COMOF programme. The European  Union  advances multiple arguments in support of this aspect 
of its claims, including that the USDOC 's determination  (i) was not based on the legislation  pursua nt 
to which the countervailed subsidies were provided, but rather on the rules governing access to 
subsidies under the COMOF programme , which is no longer in force ; (ii) erroneously found that 
assistance under the SPS, BPS, and GP programmes was tied to th e production of olives;  
(iii) misconstrued  or did not account  for certain features of the relevant calculation and eligibility 
rules; and (i v) was not based on positive  evidence  or a reasoned  and adequate  explanation, in the 
light of the United  States'  obligations under the above -mentioned provisions of the SCM  Agreement . 
We examine the merits of the European  Union's  claims in the sections  that follow.  
7.2.2.2   Whether  the USDOC  was entitled  under  Article  2.1(a ) of the SCM Agreement  to 
determine  de jure specificity  based  on rules  governing  the amount  of a subsidy  
7.19.   The first question we address is whether the USDOC was entitled under the terms of 
Article  2.1(a ) of the SCM  Agreement  to find that the BPS and GP  programm es provided de jure 
specific subsidies based on the rules for calculating  subsidy  amounts , as opposed to  the criteria 
governing the eligibility  for subsidies under those programmes. In essence, the European  Union  
argues that it follows from the terms of Article  2.1(a) that a de jure specificity finding must be based 
on the eligibility  criteria  for a subsidy, and not on the rules governing the amounts of subsidy 
available to eligible enterprises.77 The United  State s, however, argues that a finding that the 
eligibility criteria of a subsidy programme explicitly limit access to a subsidy to certain enterprises 
is not the only way to establish de jure specificity under the terms of Article  2.1(a). For the 
United  States , an explicit limitation on access to a subsidy can manifest in different ways, including 
as a limitation on the amounts  available under a subsidy programme.78 
7.20.   We start by reviewing the text of Article  2.1(a)  of the SCM Agreement , which  provides:  
In order to determine whether a subsidy, as defined in paragraph  1 of Article  1, is 
specific to an enterprise or industry or group of enterprises or industries (referred to in 
this Agreement as "certain enterprises")  within the jurisdiction of the granting 
authorit y, the following principles shall apply:  
Where the granting authority, or the legislation pursuant to which the 
granting authority operates, explicitly limits access to a subsidy to certain 
enterprises, such subsidy shall be specific.  
7.21.   The European  Union  argues that the terms "access to a subsidy" found in Article  2.1(a)  must 
be understood to mean that the central focus of a determination of de jure specificity is the criteria 
defining eligibility  for a subsidy, as eligibility  is what ultimately determines w hether an entity has a 
 
77 European  Union's  first written submission, paras.  190-191, 196, and 203-204; 10  June 2020 respons e 
to Panel question No.  2, paras.  2-13; 8  September  2020 response  to Panel question No.  1(a), para. 16; 
opening statement at the first meeting of the Panel , para. 6; 12  November  2020 response  to Panel question 
No. 2, paras.  3 and 11-13; and second written submission, para. 13. 
78 United  States'  10 June 2020 response to Panel question No.  2, paras.  3-8; 8 September  2020 
response to Panel question No.  1(a), paras.  1-2; opening statement at the first meeting of the Panel , 
paras.  13-14; 12  November  2020 response to Panel question No.  2, paras.  9-10; second written submission, 
para. 8; and opening statement at the second meeting of the Panel , para. 4. WT/DS 577/R  
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  right to receive "access"  to a subsidy.79 The European  Union draws support for its interpretation of 
Article  2.1(a)  from parts of the Appellate  Body report in US – Anti-Dumping  and Countervailing  
Duties  (China) , including the Appellate  Body's statement that " the focus of the inquiry [under 
Article  2.1(a)] is on whether certain enterprises are eligible for the subsidy, not on whether they in 
fact receive it ".80 
7.22.   The United  States  maintains  that the text of Article  2.1(a ) does not  prescribe a particular form 
that a limit on "access" must take. While the United  States  accepts that such a limit may be found 
in the criteria determining eligibility  for a subsidy, it also considers that the criteria determining the 
eligibility  for certain amounts  of a subsidy could be an explicit limitation on access to a subsidy.81 In 
the view of the United  States , a limit based on distinctions that differentiate the amount of subsidies 
that certain enterprises are eligible to receive vis-à-vis other en terprises could similarly differentiate 
the right or opportunity to benefit from or to use a subsidy.82 The United  States argues that the 
Appellate  Body's  statement from US – Anti-Dumping  and Countervailing  Duties  (China) , which the 
European  Union  relies upon , does not preclude the possibility of making de jure specificity findings 
that are not based solely  on eligibility criteria. This is because, according to the United  States , the 
Appellate  Body's  reference to "eligibility" in the statements relied upon by the European  Union , was 
merely shorthand for saying "qualified to access". Thus, the United  States  maintains that the 
Appellate  Body's  statement that "the focus of the inquiry is on whether certain enterprises are 
eligible for the  subsidy, not on whether they in fact receive it", should not be understood to suggest 
that "access" in Article  2.1(a)  means "eligibility" .83 In the view of the United  States,  if the drafters 
of the SCM  Agreement had intended that the word "access" should be exclusively understood to 
mean "eligibility", they would have used that word instead of "access", in the same way that the 
word "eligibility" is explicitly used in the text of Article  2.1(b).84 
7.23.   Canada broadly agrees with the European  Union , arguing that  "access to a subsidy" refers to 
eligibility for a subsidy, not to distinctions that affect the amount of subsidy that an enterprise will 
receive.85 According to Canada, this understanding is supported by the fact that Article  2.1(a ) does 
not refer to "amount of subsidy", unlike other provisions of the SCM  Agreement .86 
7.24.   Mexico also shares the European  Union's  views , arguing that the expression  "explici tly limits 
access to a subsidy to certain enterprises" is necessarily linked to eligibility criteria for granting a 
subsidy. Mexico sees nothing in the text of Article  2.1(a ) of the SCM  Agreement  suggesting that a 
subsidy may be specific when access is gen eralized but distinctions exist in relation to the amounts 
granted.87 
7.25.   We note that both the European  Union  and the United  States  agree that the ordinary meaning 
of the word "access" includes the "right or opportunity to benefit from or use a system or serv ice".88 
We do not see anything inherent in this meaning, or in the terms of Article  2.1(a ) more broadly, to 
suggest that the existence of an explicit limitation on access  to a subsidy must be determined solely 
based on the eligibility criteria for any subs idy under a particular programme. Article  2.1(a) does 
not, for example, prescribe that any particular feature of the legislation pursuant to which the 
granting authority operates must be examined or be the source of an explicit limitation on access to 
a subsidy. On the contrary, the analysis that is called for under Article  2.1(a) simply focuses on the 
granting authority, or the legislation pursuant to which the granting authority operates, without 
further precision or qualification . In our view, this sugge sts that in principle any one or more aspects  
of the legislation pursuant to which the granting authority operates may potentially – and depending 
upon the facts  – serve to demonstrate the existence of an explicit limitation on " access " to a subsidy. 
 
79 European  Union's  10 June 2020 response to Panel question No.  2, paras.  2-9. 
80 European  Union's  first wri tten submission, para. 207; 10  June 2020 response to Panel question No.  2, 
paras.  12-13 (both referring to Appellate  Body Report, US – Anti-Dumping  and Countervailing  Duties  (China) , 
para. 368). See also Appellate  Body Report, US – Carbon  Steel (India) , para. 4.368 . 
81 United  States'  10 June 2020 response to Panel question No.  2, paras.  3-6. 
82 United  States'  10 June 2020 response to Panel question No.  2, para. 5. 
83 United  States'  10 June 2020 response to Panel question No.  8, fn 32. 
84 United  State s' 10 June 2020 response to Panel question No.  2, para. 6. 
85 Canada's  third-party response to Panel question No.  2, para.  2. 
86 Canada's  third-party response to Panel question No.  2, para.  3. 
87 Mexico's  third-party response to Panel question No.  2, p. 2. 
88 European  Union's  10 June 2020 response to Panel question No.  2, para.  4; 
United  States'  10 June 2020 response to Panel question No.  2, para. 5 (both quoting  Definition of "access" 
from The Oxford English Dictionary , (Exhibit  USA-29)). WT/DS577/R  
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  What matters under Article  2.1(a) is that the granting authority, or the legislation  pursuant to which 
the granting authority operates, is shown to limit  explicitly access to a subsidy. To this extent , we 
do not understand Article  2.1(a ) to preclude the possibility of a finding of de jure specificity based 
on the rules governing the calculation of subsidy amounts available under a programme . However, 
at the same time, because the rules governing the calculation of the amount of a subsidy may not 
be the only feature  of a subsidy programme bearing upon "the right or opportunity to benefit from 
or use" a subsidy, a finding of de jure  specificity that ignores other relevant features of the subsidy 
programme would not be well -founded. Thus, althoug h Article  2.1(a ) does not exclude the possibility 
of grounding a finding of de jure  specificity on the criteria or conditions governing the amount of a 
subsidy , any such reliance must not be selective in the light of other relevant de jure  features of the 
subsidy programme.  
7.26.   Turning to the immediate context of Article  2.1(a), we note that Article  2.1(b ) of the 
SCM Agreement  provides as follows:  
Where the granting authority, or the legislation pursuant to which the granting authority 
operates, establishes obj ective criteria or conditions[2] governing the eligibility for, and 
the amount of, a subsidy, specificity shall not exist, provided that the eligibility is 
automatic and that such criteria and conditions are strictly adhered to. The criteria or 
conditions must be clearly spelled out in law, regulation, or other official document, so 
as to be capable of verification . 
2 Objective criteria or condition s, as used herein, mean criteria or conditions which are neutral, 
which do not favour certain enterprises over others, and which are economic in nature and 
horizontal in application, such as number of employees or size of enterprise.  
7.27.   The first sentence of Article  2.1(b ) prescribes inter alia that specificity shall not exist where 
the granti ng authority, or the legislation pursuant to which the granting authority operates, 
establishes objective criteria or conditions governing the eligibility for, and the amount of, a subsidy.  
Thus, like Article  2.1(a), Article  2.1(b)  direct s scrutiny towards  the granting  authority  or the 
legislation  pursuant  to which  the granting  authority  operates . However, in contrast to the principle 
set out in Article  2.1(a), which  describes when a subsidy " shall be specific ", Article  2.1(b ) identifies 
when " specificity  shall not exist". 
7.28.   In our view, the overlapping subject matter and binary nature of the purpose of the principles 
set out in Articles  2.1(a)  and 2.1(b)  suggest that they operate simultaneously. Under this reading 
of the two provisions, an indica tion of non-specificity  under Article  2.1(b ) would normally imply that 
the granting authority, or the legislation pursuant to which the granting authority operates, could 
not be found to explicitly limit access to a subsidy to certain enterprises, within t he meaning of 
Article  2.1(a).  The fact that the rules governing the eligibility for , and the amount of , a subsidy do 
not favour certain enterprises over others (within the meaning of footnote 2  of the 
SCM Agreement ) would normally suggest that access to th at subsidy was not explicitly limited to 
certain enterprises. Likewise , facts that would normally signal an absence  of non-specificity , within 
the meaning of Article  2.1(b), could also drive a conclusion of specificity  under Article  2.1(a).  This 
could aris e, for example, when the rules governing the eligibility  for a subsidy  are not neutral and 
favour certain enterprises (within the meaning of footnote 2).  
7.29.   The European  Union's  position implies  that a determination of specificity under Article  2.1(a ) 
cannot be based on only a finding that the rules governing the amount  of a subsidy  are not neutral 
and favour certain enterprises  over others (within the meaning of footnote 2) . While we understand 
the European  Union  to accept that such a factual scenario would establish an absence of 
non-specificity within the meaning of Article  2.1(b), the European  Union  does not consider it would 
be a sufficient basis to find the existence of an explicit limitation on access to a subsidy, under the 
terms of Article  2.1(a ). 
7.30.   On balance, w e are not convinced by the European  Union's  submission. We see no textual 
basis in the relevant provisions to limit the potential legal relevance of such evidence to a showing 
of the absence of non -specificity under Article  2.1(b ) alone. Ra ther, in our view, the fact that 
Article  2.1(b ) refers to rules governing the eligibility for, as well as the amount of, a subsidy, 
suggests that evidence of both factors may be important when considering the question of specificity 
under Article  2.1(a), g iven that both provisions direct scrutiny towards the same subject -matter , 
which is  the granting  authority  or the legislation  pursuant  to which  a granting  authority  operates . WT/DS 577/R  
BCI deleted, as indicated [[ ***]] 
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  Thus, i n our assessment , Article  2.1(b ) serves as important contextual support for an interpretation 
of Article  2.1(a ) that does not preclude the legal possibility of establishing de jure specificity based 
on an "access" limitation found in the rules governing the amount of a subsidy provided un der a 
subsidy programme.  
7.31.   We next examine Article  2.1(c)  of the SCM Agreement , which provides as follows:  
If, notwithstanding any appearance of non -specificity resulting from the application of 
the principles laid down in sub paragraphs  (a) and (b), there ar e reasons to believe that 
the subsidy may in fact be specific, other factors may be considered.  Such factors 
are: use of a subsidy programme by a limited number of certain enterprises, 
predominant use by certain enterprises, the granting of disproportionat ely large 
amounts of subsidy to certain enterprises, and the manner in which discretion has been 
exercised by the granting authority in the decision to grant a subsidy. In applying 
this subparagraph, account shall be taken of the extent of diversification of economic 
activities within the jurisdiction of the granting authority, as well as of the length of time 
during which the subsidy programme has been in operation.89 
7.32.   Article  2.1(c) prescribes that specificity may arise in situations where, notwithstanding  any 
appearance of non -specificity resulting from the application of the principles in 
subparagraphs  (a) and (b), there are reasons to believe that the subsidy may in fact be specific, 
based on a consideration of other factors, including " the granting  of disproportionately  large amounts  
of subsidy  to certain  enterprises ". In our view, the fact that the drafters of the SCM  Agreement 
explicitly envisaged the possibility of finding de facto  specificity in situations where an otherwise 
neutral calculation methodology is applied in a manner that results in the granting of 
disproportionately large amounts of subsidy to certain enterprises, indicates that they did not intend 
to exclude a finding  of de jure  specificity under Article  2.1(a) when the legislation pursuant to which 
a granting authority operates expressly provides for exactly the same outcome  by establishing rules 
governing the amount of a subsidy that favour certain enterprises over o thers.  Accordingly,  we find 
that Article  2.1(c) also supports the view that an explicit limitation on access to a subsidy for the 
purpose of Article  2.1(a ) might well be found in the rules governing the amount of a subsidy, not 
only the criteria governing the eligibility for a subsidy.  
7.33.   Thus, in the light of the above considerations, we find that Article  2.1(a ) of the 
SCM Agreement  does not preclude reliance on criteria or conditions governing the amount of a 
subsidy to establish that access to a subsidy is explicitly limited  to certain enterprises,  within the 
meaning of that provision. We emphasize, however, that because the rules governing the calculation 
of the amount of a subsidy may not be the only feature of a subsidy programme bearing upon "the 
right o r opportunity to benefit from or use" a subsidy, a finding of de jure  specificity that ignores 
other relevant features of the subsidy programme would not be well -founded. Thus, although 
Article  2.1(a ) does not exclude the possibility of grounding a finding of de jure  specificity on the 
criteria or conditions governing the amount of a subsidy , any such reliance must not be selective in 
the light of other relevant de jure  features of the subsidy programme. Accordi ngly, we find that the 
European  Union  has failed to establish that the United  States  acted inconsistently with Articles  2.1 
and 2.1(a ) of the SCM  Agreement  merely because the USDOC based its findings of de jure specificity 
in the ripe olives countervailing  duty investigation on the rules in the relevant subsidy programmes 
governing the calculation of the amounts of subsidies available to eligible enterprises.  
7.2.2.3   The USDOC 's conclusion  that the BPS and GP programmes  retained  the inherent  
de jure specificity  of the subsidies  provided  under  the COMOF  programme  
7.2.2.3.1   The USDOC 's reliance  on facts  pertaining  to past subsidy  programmes  
7.34.   As already noted, in the Remand Redetermination , the USDOC further  explain ed and 
elaborate d upon  the findings of de jure specificity made in the final determination , and affirmed  the 
finding  that the BPS and GP programmes provided benefits that were de jure  specific to olive 
growers . In part 1 of the analysis of the Remand Redetermination, the USDOC recalls the main 
element s of its findings. After explaining that its findings concerned the "programs implemented 
pursuant to the European  Union's  Common Agricultural Policy (CAP), which provided subsidies to 
olive growers, particularly under the Basic Payment Scheme (BPS)", the USDOC notes a 
 
89 Fn omitted.  WT/DS577/R  
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  consideration that lies at the centre of its de jure specificity determination – namely, that the 
"manner in which Spain implemented the BPS as it relates to the provision of, and the amount of 
benefits to, olive growers relied  heavily  of [sic] the provision  of benefits  under  two predecessor  
programs : the [COMOF  programme]  … and the Single  Payment  Scheme  (SPS)".90 The USDOC then 
briefly describes how the alleged de jure specific nature of the subsidies provided to olive growers 
under the COM OF programme , was "preserved" through the operation of the SPS  programme  and 
"retained" in the BPS  programme  by virtue of its subsidy amount calculation rules. At the end of this 
section, the USDOC recalls and explains the summary of the analysis set out i n its earlier 
determinations as follows:  
[The USDOC]'s  analysis  is summarized:  
In summary, the annual grant amount provided to olive farmers under BPS is based on 
the annual grant amount provided to olive farmers under SPS. The grant amount 
provided to olive farmers under SPS is based on the average grant amount olive farmers 
received in 1999 through 2002 under the [COMOF programme] . The grant amount 
provided in 19 99 through 2002 to eligible farmers, which included olive farmers, was 
based on the type of crop grown and the production value created from the 
crop. Therefore, the annual grant amount provided under BPS {is} based on annual 
grant amounts that were crop -specific, thus the grant amounts received by olive 
growers under BPS in 2016 are directly related to the grant amount only olive growers 
received under the [COMOF programme].91 
This analysis was the basis of [The USDOC]'s  finding that the BPS provided subsi dies 
that are de jure specific to olive growers. Because : the [COMOF programme]  was 
available only to olive growers ( i.e., access to its benefits was "expressly limited" to the 
olive sector); the SPS calculated the grant amount based on data regarding the type of 
crop, and the volume and value of production collected under the [COMOF programme]  
(i.e., preserving the limited access to benefits available to the olive sector under the 
[COMOF programme] ); and, by law, access to the SPS grants provided the found ation 
of the BPS subsidy payments, the BPS retained the de jure specificity inherent in the 
[COMOF programme] .92 
7.35.   These passages reveal that the USDOC determined that the BPS subsidies were de jure 
specific because it found that, as a matter  of law, BPS sub sidy payments were fundamentally based 
on grants provided under the SPS  programme , which in turn, were derived from olive -specific 
payments made under the COMOF programme.  
7.36.   The parties agree that a de jure specificity finding, within the meaning of Article  2.1(a), must 
be grounded in the "legislation pursuant to which the granting authority operates" or the acts of the 
granting authority itself.93 On reading the USDOC 's preliminary and final issues and deci sion 
memoranda , as well as the Remand Redetermination, it is apparent that the USDOC 's findings were 
aimed at understanding whether the grants provided to farmers under the BPS  programme  pursuant 
to Regulation 1307/201394, as implemented by the GOS in Roya l Decree 1075/201495 and 
Royal  Decree 1076/201496, were de jure specific.97 The USDOC 's determinations reveal that its 
examination of these instruments was informed by how , in the USDOC's  view,  they integrated as a 
matter of law certain aspects of two predecessor subsidy programmes. The USDOC proceeded in 
this way because it found that the BPS subsidy calculation rules, as implemented by the GOS, 
 
90 Remand Redetermination, ( Exhibit  EU-80), p. 6. (emphasis  added)  
91 Remand Redetermination, ( Exhibit  EU-80), p p. 8-9 (referring to PIDM, ( Exhibit  EU-1), p. 24) 
(fn omitted) . The final issues and decision memorandum  contains similar language.  (FIDM, (Exhib it EU-2), 
p. 36). 
92 Remand Redetermination, ( Exhibit  EU-80), p. 9. 
93 European  Union's  first written submission, para. 235 (quoting  Appellate  Body Report, US – Large  Civil 
Aircraft  (2nd complaint) , para. 748, explaining that the source of any limitation is the legislation pursuant to 
which the granting authority operates, or the granting authority itself ); United  States'  10 June 2020 response 
to Panel question No.  2, paras.  4 and 8 . 
94 Regulation 1307/2013, ( Exhibit  EU-25). 
95 Royal Decree 1075/2 014, ( Exhibit  EU-19). 
96 Royal Decree 1076/2014, ( Exhibit  EU-30). 
97 PIDM, ( Exhibit  EU-1), pp. 20-21; FIDM, ( Exhibit  EU-2), pp. 34-35; and United  States'  first written 
submission, para. 53. WT/DS 577/R  
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  expressly relied upon particular aspects of those programmes to determine subsidy amounts 
available to eligible farmers. Among the passages from the USDOC 's determinations that we believe 
confirm this understanding are the following from the Remand Redetermination:  
To determine access to payments under th e BPS, and the criteria or conditions 
governing the eligibility for, and the amount of the subsidy, the BPS legislation expressly 
refers to prior legislation and incorporates by reference the eligibility criteria from the 
prior legislation. An examination of the prior legislation explicitly referenced in and 
incorporated by the BPS demonstrates a linkage between eligibility for the crop -specific 
payments provided under the prior legislation and the current payments provided under 
the BPS. This link continue d to entrench limited access and favored the olive industry.  
… The legislation governing the BPS program may not have explicitly stated that it 
intended to benefit olive growers; however, the BPS program expressly references prior 
legislation that dictates  the access to and amount of BPS payments that, by law, 
provides expressly limited access to subsidies to olive growers. The SPS and 
BPS programs, by law, rely on "historical " reference periods to preserve the benefit 
amounts provided to growers of certain  crops under predecessor programs. The GOS, 
as required by legislation, relied on volume, value, and area data, and prior subsidy 
amounts that were developed on a product -specific basis for the purpose of determining 
the amount of the subsidies provided to  olive growers under the SPS, thereby preserving 
access to the subsidy that was expressly limited under the [COMOF programme] . 
Similarly, the GOS once again, by law, relied on a historical reference period to 
determine benefits under the BPS program, and t herefore, once again, by law, 
entrenched benefits received under these past programs on a crop -specific basis. By 
designing two consecutive benefit schemes in this manner, the express terms of the 
legislation pursuant to which the GOS operates demonstrate that the GOS administers 
the current BPS payments to limit access to certain benefits to a subsector of the 
Spanish agricultural industry, olives.98 
7.37.   We recall that Article  2.1(a ) of the SCM Agreement  provides that "where the granting 
authority, or the legislation pursuant to which the granting authority operates, explicitly limits access 
to a subsidy to certain enterprises, such subsidy shall be specific". Apart from its focus on the action 
of the "granting authority" and the "legislation" pursuant to which it operates, Article  2.1(a ) does 
not refer to any particular facts or factors that may or may not be taken into account in order to 
make a finding of de jure specificity. Neither does it prescribe a particular methodolog y that must 
be followed. Thus, we do not see in the terms of Article  2.1(a)  any per se prohibition on the relevance 
and consider ation of  facts pertaining to a past subsidy programme  no longer in force  for the purpose 
of determin ing de jure specificity. On the contrary , we agree in this respect with the United  States  
that a reading of Article  2.1(a ) that would preclude the possibility of taking such information into 
account might create an exception (which the United States referred to as "a loophole" ) for subsidy 
programmes that favour certain enterprises based on explicit access limitations found in earlier laws 
or regulations  or ones no longer in force .99 Thus, in our view, it follows from the absence of any 
limitation in the text of Article  2.1(a) that an  investigating authority is entitled to review and rely 
upon any fact it considers relevant to identifying and understanding whether the actions of the 
"granting authority" in providing the subsidy under investigation or the "legislation" pursuant to 
which it operates, explicitly limit "access" to a subsidy to certain enter prises.  
7.38.   In the ripe olives investigation, the USDOC 's determination of de jure specificity concerned 
subsidies provided under the BPS and GP  programmes , as implemented by the GOS.100 The 
USDOC 's factual finding that the BPS rules governing the amount of sub sidy available to eligible 
farmers explicitly referred to and incorporated certain features of the SPS  programme  (and through 
the SPS  programme , the COMOF programme ) was central to its de jure specificity determination. In 
our view, the USDOC did not act i nconsistently with Article  2.1(a ) simply because its determination 
was dependent upon how certain alleged features of past subsidy programmes  were relied upon and 
 
98 Remand Redetermination, ( Exhibit  EU-80), p p. 48-49. 
99 United  States'  10 June 2020 response to Panel question No.  4, para. 18. 
100 FIDM, ( Exhibit  EU-2), p. 12. See also United  States'  second written submission, para. 17, explaining 
that "it was the BPS Programs that during the period of investigation conferred countervailable subsidies to 
olive growers" and that "the USDOC countervailed subsidies for the same programs ( i.e., the 
BPS Programs ) for which it made its determination of de jure specificity".  WT/DS577/R  
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  integrated into the countervailed subsidy programme . Moreover, we do not share the 
European  Union's  view that in order to properly base its de jure specificity finding upon such 
information, the USDOC was required  to follow the particular analytical approach or methodology 
the European  Union  advances.101 As already noted, Article  2.1(a ) imposes no limits on the facts an 
investigating authority is entitled to rely upon; and it prescribes no particular analytical approach or 
methodology that must be followed in assessing those facts. Thus, in our view, the USDOC was 
entitled to rely on the combination  of facts and particular analytical approach it considered relevant 
to answer the question it was investigating – whether the BPS and GP  programmes , as implemented 
by the GOS, explicitly limited access to a subsidy to certain enterprises.  
7.39.   Having said that,  a separate matter is whether the USDOC 's findings in relation to the content 
and meaning of the BPS  programme  as implemented by the GOS (including as regards the allegedly 
referenced and incorporated features of past programmes) were properly supported by  the facts, 
and whether the USDOC reasonably and adequately explained how those findings show that the 
BPS programme  explicitly limited access to the subsidy under investigation to certain enterprises. 
On these questions, the European  Union  argues that the USDOC 's factual findings and explanations 
fell short of the required standard. The United  States  argues that throug h some of these allegations 
the European  Union  seeks  the Panel to conduct a  de novo review of the USDOC 's factual findings, 
which is inconsistent  with the Panel 's standard of review.102 In accordance  with our standard of 
review under Article  11 of the DSU103, we address the European  Union's  specific criticisms in the 
sections  that follow  by evaluating whether the USDOC provided a reasoned and adequate 
explanation as to how the evidence on the record supported its factual findings and how those factual 
finding s supported the overall determination . 
7.2.2.3.2   The USDOC 's alleged  finding  that the SPS, BPS, and GP  subsidies  were  de jure 
specific  to olive  growers  because they were  coupled  (or tied) to the production  of olives  
7.40.   One of the main aspects of the USDOC 's de jure specificity determination contested by the 
European  Union  is the USDOC's  repeated finding that the BPS, GP, and SPS subsidies to "olive 
growers" are de jure specific . The European  Union  argues that the various manifestations of these 
statements in the USD OC's determinations demonstrate that the USDOC considered that the SPS 
and BPS /GP subsidies were tied to continued olive production, revealing an erroneous understanding 
of the operation of the two programmes.104 According to the European  Union , the USDOC 's findings 
contradict the positive evidence on the record showing that the subsidies under both programmes 
were not limited to olive growers, and were not tied to production, as there was neither a legal 
obligation on recipients t o continue growing the same crops grown before the entry into force of the 
programmes, nor any requirement to grow any crop at all, in order to be eligible for assistance.105 
Accordingly, the European  Union argues that the USDOC's  de jure specificity findin gs misconstrue 
the relevant legal instruments, and for this reason are inconsistent with Articles  2.1, 2.1(a),  and 2.4 
of the SCM  Agreement.106 
7.41.   The United  States  denies that the USDOC 's determination s of de jure specificity were based 
on finding s that subsi dy payments to olive growers were tied to olive production  in the period of 
investigation. According to the United  States , the USDOC 's determination s were grounded in the fact 
 
101 European  Union's  10 June 2020 resp onse to Panel question No.  4, para.  34, arguing that if an 
investigating authority wants to determine that a subsidy programme "A" is de jure specific on the basis of a 
past programme "B" that is no longer in force, it will have to  (i) demonstrate that the  legislation governing 
programme "A" explicitly limits access to the subsidy to those undertakings that were eligible under 
programme "B"; and (ii ) conclude that programme "B" was in itself specific and explain why it reached that 
finding.  
102 Including the ones discussed in sections 7.2.2.3.4 , 7.2.2.3.5 , 7.2.2.3.6 , and 7.2.2.3.8  below. 
(United  States'  first written submission, p ara. 86). 
103 See section 7.1.2 above.  
104 European  Union's  first written submission, paras.  211 and 216; 10  June 2020 response to Panel 
question No.  9, para. 51; opening  statement at the first meeting of the Panel , paras.  12 and 20; second 
written submission, paras.  35-36 and 40; and 11 March  2021 comments on the 
United  States'  25 February  2021 response to Panel question No.  2, para. 10. 
105 European  Union's  first written s ubmission, paras.  218-225; 10  June 2020 response s to Panel 
question No.  6, para. 39, and No.  10, paras.  55-56; 8  September  2020 response to Panel question No.  1(c), 
paras.  52-54; opening statement at the first meeting of the Panel, paras.  13 and 53-54; and 25 February  2021 
response to Panel question No.  3, paras.  22-23. 
106 European  Union's  first written submission, para. 227; opening statement at the first meeting of the 
Panel , para. 26. WT/DS 577/R  
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  that the limit on access to subsidies provided under the COMOF  programme , which favoured olive 
growers, continued to determine access to subsidies and subsidy amounts under the SPS and  
BPS/GP programmes .107 While the United  States  acknowledges that the USDOC 's determination 
identified a connection between the SPS/ BPS subsidy recipients and olive production, the 
United  States  points out that this was only historic  olive production during the COMOF  programme  
reference period, not olive production during the operat ion of the BPS programme .108 The 
United  States  argues , furthermore,  that the focus of the USDOC's  de jure specificity findings (i.e.  the 
"certain enterprises"  within the meaning of Article  2.1(a)  identified in the USDOC 's determinations ) 
were holders of ent itlements whose value derived from assistance received under the COMOF 
programme, whether  olive growers  or not.109 In particular, the United  States asserts that  the USDOC  
found the BPS subsidies were de jure specific because access to a "discrete component of the BPS 
Programs – i.e., entitlement values from historic olive production -based subsidies – was limited to 
farmers on lands that qualified them for these entitlements".110 
7.42.   In our view, when considered in isolation, two passages from the USDOC 's preliminary issues 
and decision memorandum identified by the European  Union  suggest that the USDOC did, in fact, 
find that the BPS subsidies were de jure specific to olive growers  because  they were tied to 
contemporaneous  olive production . In particular:  
We further preliminarily determine that the grants provided under [the BPS programme]  
are specific within the meaning of section  771(5A)(D)(i ) of the Act because  the crop 
type determines  the grant  amounts  provided  under  this program  due to the direct 
reliance on the grant amounts provided under previous programs, which based grant 
amounts on the crop type . As such, the [BPS programme] is specific to olive growers . 
… Given that the assistance provided to olive growers  is grante d because  they are 
growing  olives , we preliminarily determine that the assistance is tied to the production  
of olives , according to 19 CFR 351.525(b)(5).111 
7.43.   We note, however, that the  European  Union  does not point to any equivalent statements 
made in the USDOC's  final issues and decision memorandum. Nevertheless, according to the 
European  Union, the fact that the USDOC confirmed its preliminary determination  in the conclusions 
reached in its final determination  demonstrates that the USDOC continued to hold the same view.112 
The European  Union finds support for this submission in the following passages from the 
USDOC's  final issues and decision memorandum113: 
As we explained in the Preliminary  Determination , our finding of de jure specificity is 
based on the manner in which Spain  implemented the Pillar I programs with reference 
to the operations of its two predecessor  programs, the [SPS programme ] and the 
[COMOF  programme ], and the manner in which  the amount of assistance was  
determined under these two programs. The earliest of these programs, the [COMOF  
programme ], was in place from 1999 through 2003, and provided  production aid in the 
 
107 United  States'  first written submission, para. 57; 10  June 2020 responses to Panel question No.  1, 
para. 2, No.  6, para.  24, No.  7, paras.  26-28, and No.  9, para.  36; 8  September  2020 response to Panel 
question No.  1(c), paras.  11-14; opening statement at the first meeting of the Panel , paras.  5-6; and 
12 November  2020 response to Panel question No.  1, para. 2. 
108 United  States'  first written submission, paras.  63-64 and 100; 8  September  2020 response to Panel 
question No.  1(c), para. 14; opening statement at the first meeting of the Panel , paras.  11 and 21-24; 
12 November  2020 response to Panel question No.  5, paras.  18-19; second written submission, paras.  21 and 
27; opening statement at the second meeting of the Panel , para. 3; and 25 February  2021 response to Panel 
question No.  2, paras.  4-10. 
109 United  States'  10 June 2020 response s to Panel question No.  6, para.  24, No.  7, para.  26, and No.  8, 
para. 29; 8  September  2020 responses to Panel question No.  1(c), para.  11, and No.  1(d), para.  16; opening 
statement at the first meeting of the Panel , paras. 21-23; and 12 November  2020 response to Panel question 
No. 5, para. 18. 
110 United  States'  second written submission, para. 28. See also United  States'  8 September  2020 
response s to Panel question No.  1(c), paras.  11-13, and No.  1(d), para. 16; 12  Novemb er 2020 response s to 
Panel question No.  1, para.  6, and No.  5, paras.  18-19 and 22; and opening statement at the second meeting 
of the Panel , paras.  11 and 15.  
111 PIDM, ( Exhibit  EU-1), p. 24. (emphasis  added ) 
112 European  Union's  first written submission, paras.  213-215. 
113 European  Union's  first written submission, paras.  213-215. WT/DS577/R  
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  form of annual grants to farmers on the basis of type of crop and the  volume of 
production.  
… Because the [COMOF  programme ] provided benefits on a de jure specific basis, the 
benefits provided under the SPS retained the de jure specificity inherent in the 
[COMOF  programme ]. 
…  
In summary, the annual grant amounts provided to olive farmers under [the 
BPS programme ] and [ the GP programme ] derive from the amount of SPS grants that 
were provided to each farmer in 2013. As explained above, the calculation of the grant 
amount under SP S retains the de jure  specificity inherent in the [COMOF programme] . 
Therefore, the annual grant amounts provided under [the BPS programme ] and [ the 
GP programme ] in 2016 are directly related to, and continue to retain the de jure 
specificity of, the grant s provided to olive growers under the [COMOF programme] .114 
7.44.   The European  Union places particular emphasis  on the last part of the first passage 
reproduced above, where the USDOC explains that "aid" was provided "on the basis of type of crop 
and the volume o f production", as well as the USDOC's  statements in the two following passages 
where it concludes that SPS benefits "retained the de jure  specificity inherent" in the 
COMOF  programme, and that BPS payments "continue to retain the de jure  specificity" of th e COMOF 
programme. We note, however, that the statement from the first passage refers directly to the 
COMOF programme, and not the BPS or GP  programme . Moreover, we do not understand the 
statements about the retention  and continuation  of the specificity inherent in the COMOF programme 
to indicate that the USDOC was of the view that the BPS and SPS subsidies were de jure  specific to 
olive growers because  those subsidies were tied to olive production, in the same way as the 
COMOF  programme subsidies. Rather, the USDOC statements reflect its view that the BPS and 
SPS subsidies were de jure  specific because they derived  from the crop -specific COMOF programme  
assistance. As such, we do not understand the above passages to mean that the USDOC concluded 
that the BPS, SPS, and GP subsidies were de jure  specific to olive growers because assistance 
received under those programmes was tied to olive production during  the operation of the 
BPS programme . 
7.45.   The United  States argues that "the final determination is clear in identifying that the 'certain 
enterprises'  under Article  2.1(a)  are holders of entitlements whose value derived from the 
[COMOF  programme]".115 The Unite d States finds support for this submission in the following specific 
observation made by the USDOC in the final issues and decision memorandum, which we quote 
below in its context and emphasize in italics:  
As the EC points out, when the SPS program was imp lemented in Spain, the aid provided 
to farmers was converted into "entitlements," rights to receive payments, that were 
linked to land area and completely decoupled from production. That is, under SPS, the 
amount  of the payment  is dependent  on the annual  activation  of the entitlement,  and 
is not dependent  on the type or volume  of crop produced .116 
7.46.   The United  States argues that the italicized text reveals how "the final determination reflected 
how the BPS Programs kept, from the [COMOF programme], the conditions that limited access to 
those subsidies as a discrete component of entitlement payments, whether the entitlement holders 
continued to grow olives or did something else".117 We note, however, that the passage cited by the 
United  States discusses th e SPS  programme , not the BPS  programme . Moreover, in our view, the 
statement the United  States relies upon does not support the view that the USDOC found that 
SPS subsidies were de jure specific to holders of entitlements whose value derived from the 
COMOF  programme, whether  or not olive growers . In this regard, we note that the only explicit 
statement of the USDOC's  de jure specificity findings with respect to the SPS  programme  is found 
in the USDOC's  preliminary issues and decision memorandum, which provi des as follows:  
 
114 FIDM, ( Exhibit  EU-2), pp. 32, 33, and 36 . (fns omitted ; emphasis added ) 
115 United  States'  opening statement at the first meeting of the Panel , para. 21. 
116 FIDM, ( Exhibit  EU-2) p. 33. (fn omitted; emphasis  added)  
117 United  States'  opening statement at the first meeting of the Panel , paras.  22-23. WT/DS 577/R  
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  We further preliminarily determine that the grants provided under [the SPS] program 
are specific within the meaning of section  771(5A)(D)(i)  of the Act because the crop 
type determines  the grant  amounts  provided under this program due to th e direct 
reliance on the grant amounts provided under previous programs, which based  grant  
amounts  on the crop type. As such, the [SPS] program is specific to olive growers . 
… Given that the assistance provided to olive growers  is granted because  they are 
growing  olives , we preliminarily determine that the assistance is tied to the production  
of olives , according to 19 CFR 351.525(b)(5).118 
7.47.   Rather than demonstrating that the USDOC found that the SPS subsidies were de jure specific 
to any farmers with ent itlements based on the COMOF programme, these USDOC conclusions (which 
are identical to the USDOC statements we have quoted above in relation to the BPS and 
GP programmes ) suggest that the USDOC did, in fact, find that the SPS subsidies were de jure 
specif ic to olive growers  because  they were tied to contemporaneous  olive production . 
7.48.   More generally, the United  States argues that the USDOC finding that "certain enterprises" 
for the purpose of Article  2.1(a)  were holders of entitlements whose value derived from the 
COMOF  programme, whether or not olive producers, is evident in the USDOC's  preliminary and final 
determinations .119 However, in making this submission, the United  States does not point120 to any 
specific statement or conclusion in the USDOC' s preliminary or final determinations that explains the 
de jure specificity finding in these terms. Rather, referring to four pages in the USDOC's  final issues 
and decision memorandum, the United  States argues that the USDOC's  analysis "identified that 
(i) the [COMOF programme] conferred subsidies based on historic olive production and (ii)  the 
SPS Program and BPS Programs preserved the conditions that limited access to those subsidies as 
a discrete component of entitlement payments, whether the holders of those entitlements continued 
olive production or replaced that production".121  
7.49.   We agree that when read in its totality, the analysis set out in the four pages of the 
USDOC's  final issues and decision memorandum and other record evidence suggests that the U SDOC 
understood that subsidies provided under the SPS, BPS, and GP  programmes  were not tied to olive 
production during the period of operation of the  SPS programme  or the BPS programme . Thus, for 
example, the USDOC observed in its verification report that: 
To receive an income grant [under the SPS  programme ], the farmer must annually 
"activate"  the entitlements and the number of eligible hectares through an application 
process. The  farmer's current production or lack of production  was not a factor in the 
process or evaluation of a farmer's application for an income grant under SPS.  
…  
To be eligible for assistance under the BPS and [GP] programs, a recipient has to be an 
"active " farmer, meaning that the farmer  maintains  the land in arable  condition . There 
are no production  requirements .122 
7.50.   That the USDOC recognized that the BPS subsidies were not tied to contemporaneous olive 
production is also evident in the manner in which the USDOC responded to arguments about the 
"decoupled" nature of the programme  made by the European Commission, the GOS, and the 
respondents:  
Despite the arguments from the EC, the GOS, and the respondents, that because the 
BPS programs provide benefits that have been decoupled from production, they are not 
 
118 PIDM, (Exhibit  EU-1), p. 27. (emphasis added)  
119 United  States'  8 September  2020 response to Panel question No.  1(c), para. 11. 
120 Except for the statement from the FIDM that "under SPS, the amount of the payment is dependent 
on the annual activation of the entitlement, and is not dependent on the type or volume of crop produced", 
which, as we have expla ined, does not support the United  States'  argument.  
121 United  States'  8 September  2020 response to Panel question No.  1(c), para. 11. See also 
United  States'  opening statement at the first meeting of the Panel , paras.  21-26; 12  November  2020 response 
to Pan el question No.  5, paras.  18-22; and second written submission, para. 28. 
122 USDOC verification report : European Commission , (Exhibit  EU-22), pp.  2-3. (emphasis  added)  WT/DS577/R  
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  specific, we continue to find that the reliance on earlier assistance programs that were 
specific to determine the amounts of assistance under the current program, renders 
specific the benefits under the BPS programs.123 
7.51.   In our view, the first set of quoted s tatements from the verification  report reveals that the 
USDOC explicitly recognized that "production was not a factor" for being eligible to receive 
SPS payments, and that "no production requirements" were attached to eligibility for the 
BPS subsidies. In the second of the quoted passages, the USDOC did not deny the assertion that 
the BPS subsidies were "decoupled from production". Rather, the USDOC explained that the reason 
for its finding of specificity was the "reliance on earlier assistance programs tha t were specific to 
determine the amounts of assistance" under the BPS  programme . 
7.52.   When considered in the light of the USDOC's  other statements concerning the nature of the 
payments made under the COMOF programme (e.g.  "the [COMOF programme] provided annual 
payments only to producers of oilseed crops, including olives"), and the relationship between these 
payments and the SPS/BPS  programmes , it is reasonable to infer that the USDOC did not find that 
the SPS and BPS subsidies were de jure specific on a consideration that assistance under these 
programmes was tied to contemporaneous olive production. Rather, the USDOC's  finding was that 
the SPS,  BPS, and GP subsidies were specific because the assistance was tied to olive production in 
the historic  period when olive growers received payments under the COMOF programme. Thus, 
notwithstanding the statements the European  Union has pointed to suggesting the contrary, we 
believe that when read as a whole, the USDOC's  determination is not based on a  finding that the 
SPS, BPS, and GP subsidies were de jure specific because  they were tied to contemporaneous  olive 
production . 
7.53.   In contrast, the USDOC's  preliminary and final determinations do not support the 
United  States'  submission that the USDOC found t he "certain enterprises" for the purpose of 
Article  2.1(a)  to be holders of entitlements whose value derived from the COMOF programme , 
whether  or not olive growers . As already noted, the United  States has not pointed to any specific 
statements in those det erminations presenting the USDOC's  findings in those terms; and we do not 
see how that conclusion can be inferred from a reading of the totality of the USDOC 's analysis.  
7.54.   The United  States  argues that the  Remand Redetermination is "straightforward in identifying 
the group of enterprises" under the BPS and GP  programmes , and refers to  the following italicized 
statements  to support its position124: 
As has been discussed at length elsewhere in this redetermina tion, in identifying that 
the value  of entitlements  under  the BPS incorporates  the value  of olive production  per 
hectare  (in that it relies on the calculation of benefits provided under the SPS), as 
recorded  under  the [COMOF  programme ], the BPS continues t o treat the agricultural 
sector on a non -uniform basis and thus limits access to certain benefits to olive growers. 
Specifically,  farmers  on lands that produced  olives  during  the reference  period  continue  
to have limited  access  to entitlement  values,  and therefore  benefit  amounts,  that retain  
the historical  difference,  relative  to other  farmers  on other  lands,  that was inherent  in 
the crop-specific  subsidies  provided  under  the [COMOF  programme ]. Thus, we find that 
this program is de jure specific to olive growers within the meaning of 
section  771(5A)(D)(i ) of the Act.125 
7.55.   According to the United  States , the italicized text in the above  passage reveals how the 
USDOC "correctly observed" that by "in corporating the value of prior olive production into the 
entitlements under the BPS Programs, the BPS Programs are specific to olive growers ".126 In our 
view, this submission is difficult to reconcile with the United  States'  position that the "certain 
enter prises " identified in the USDOC 's determinations were farmers whose BPS entitlement values 
were derived from historical olive production, whether  they grew olives  or not. Nevertheless, we 
believe it is a correct characterization of the USDOC 's determination,  as in the very next sentence 
at the end of the quoted passage the USDOC concludes its analysis by finding that "this program is 
 
123 FIDM, ( Exhibit  EU-2), p. 36. 
124 United  States'  opening statement at the first meeting of the Panel , para. 24. See also 
United  States'  12 November  2020 response to Panel question No.  5, para. 21. 
125 Remand Redetermination, ( Exhibit  EU-80), p p. 58-59. (emphasis  added)  
126 United  States' opening statement at the first meeting of the Panel , para. 24. (emphasis  added)  WT/DS 577/R  
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  de jure specific to olive growers ".127 Indeed,  essentially the same conclusion about the alleged 
limited access to the SPS and BPS subsidies afforded to olive growers  can be found in other parts of 
the USDOC 's Remand Redetermination, including in the following  passages : 
[T]he SPS program preserved the access of olive farmers  to the assistance previously 
available to t hem, on a de jure specific basis, under the [COMOF  programme ][.]128 
[U]nder the SPS, access to a subsidy based on [COMOF  programme ] subsidies was 
expressly limited to olive growers [.]129 
Information provided by the GOS and the EU indicated that access to, and the amount 
of, benefits provided to olive growers  under the BPS, as a matter of law, relied for 
reference on the provision of benefits under the SPS and, in turn, access to and the 
amount of benefits provided to olive growers  under the SPS was determined by 
reference to the benefits provided under the [COMOF  programme ].130 
[The USDOC]  found that, as a result of the actions of the GOS and the EU in 
implementing the program, BPS subsidies  were not uniformly available across the 
agricultural sector in Spain because access to the BPS subsidy for olive growers  was, as 
a matter of law, based on eligibility for assistance provided under the 
[COMOF  programme] , which expressly limited access to olive growers .131 
An examination of the prior legislation explicitly referenced in and incorporated by the 
BPS demonstrates a linkage between eligibility for the crop -specific payments provided 
under the prior legislation and the current payments provided un der the BPS. This link 
continued to entrench limited access and favored the olive industry .132 
By designing two consecutive benefit schemes [ i.e. the SPS an d BPS programmes ] in 
this manner, the express terms of the legislation pursuant to which the GOS operates 
demonstrate that the GOS administers the current BPS payments to limit access to 
certain benefits to a subsector of the Spanish agricultural industry, olives .133 
7.56.   We no te, moreover, that the sentence the United  States relies upon from the above quoted 
passage in paragraph 7.54 of the USDOC's  Remand Redetermination be gins with the word 
"[s]pecifically" .134 In our view, this suggests that its contents is intended to elaborate and clarify the 
statements made in the preceding sentence. That sentence explains in general terms why the 
USDOC considers that "the BPS … limits a ccess to certain benefits to olive growers ". 
7.57.   Thus, we read the statement that "farmers on lands that produced olives during the 
[COMOF  programme] reference period  continue to have limited access to entitlement values " as the 
USDOC's  elaboration of why it considered that BPS subsidies were limited to olive growers . In our 
view, this understanding of the USDOC's  statement is consistent with the following USDOC 
observ ation made using very similar terms elsewhere in the Remand Redetermination:  
The SPS and BPS programs, by law, rely on "historical " reference periods to preserve 
the benefit amounts provided to growers of certain crops under predecessor programs . 
The GOS, as required by legislation, relied on volume, value, and area data, and prior 
subsidy amounts that were developed on a product -specific basis for the purpose of 
determining the amount of the subsidies provided to olive growers  under the SPS, 
 
127 Remand Redetermination, ( Exhibit  EU-80), p. 59. (emphasis  added)  
128 Remand Redetermination, ( Exhibit  EU-80), p. 8. (emphasis added)  
129 Remand Redetermination, ( Exhibit  EU-80), p. 16. (emphasis added)  
130 Remand Redetermination, ( Exhibit  EU-80), p. 15. (emphasis  added)  
131 Remand Redetermination, ( Exhibit  EU-80), p. 15. (emphasis  added)  
132 Remand Redetermination, ( Exhibit  EU-80), p p. 48-49. (emphasis  added)  
133 Remand Redetermination, ( Exhibit  EU-80), p. 49. (emphasis  added)  
134 We observe that the adverb "specifically" means " [i]n a specific or definite form or manner", or " [i]n 
something of the same kind". (Oxford Dictionaries online, definition of "specifically " 
https://www.oed.com/view/Entry/186003  (accessed 13 August  2021), adv., meanings 2 and 3 ). WT/DS577/R  
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  thereby preserving access to the subsidy that was expressly limited under the 
[COMOF  programme] .135  
[T]he entitlement values under the BPS for those farmers  that grow olives  retain the 
historical difference, relative to other farmers, that was inherent in the 
[COMOF  programme] .136  
7.58.   Accordingly, we do not understand the statement the United  States relies upon to 
demonstrate that the USDOC found that the "certain enterprises", for the purpose of Article  2.1(a), 
are farmers whose entitlement val ues were derived from historical olive production, irrespective  of 
whether  they are olive growers  or not. Rather, although not always expressed in exactly the same 
terms, we find that the USDOC's  de jure specificity determination is best understood as a fi nding 
that the BPS subsidies were de jure specific to olive growers  because " access to, and the amount of, 
benefits provided to olive growers  under the BPS, as a matter of law, relied for reference on the 
provision of benefits under the SPS and, in turn, access to and the amount of benefits provided to 
olive growers  under the SPS was determined by reference to the benefits provided under the 
[COMOF  programme]" .137 Thus, we find that the USDOC determined that the SPS,  BPS, and 
GP subsidies were de jure specific to olive growers , not because they were tied to the production of 
olives during the operation of the SPS and BPS programmes (as the Europe an Union argues), but 
rather because, according to the USDOC, the SPS,  BPS, and GP subsidies available to olive growers 
were tied to historical  olive production during the COMOF programme reference period.  
7.2.2.3.3   Entitlement  values  under  the BPS programme  for new farmers,  farmers  holding  
transferred  entitlements,  and farmers  no longer  growing  olives  
7.59.   The European  Union argues that the USDOC's  finding of the existence of a direct correlation 
between, on the one hand, the amounts of assistance provided to olive growers under the BPS/GP, 
programmes and on the other hand, the amounts of assistance provided  under the SPS and 
COMOF  programmes, is erroneous and ignores relevant aspects of the record evidence 
demonstrating that no such direct correlation exists.138 According to the European  Union, the USDOC 
overlooked the following features of the relevant subsi dy regime:  (i) the rules governing the 
allocation and calculation of the value of payment entitlements  of new farmers from the national 
reserve; (ii)  the possibility of obtaining payment entitlements by transfer139 from one or more other 
farmer s; and (iii) the fact that a previously active olive farmer was entitled to receive assistance 
regardless of whether that farmer continued to produce olives.140 The European  Union submits that 
these alleged errors of appreciation demonstrate that the USDOC's  determinati on of de jure 
specificity was not reasonably and adequately explained, and that it was grounded on an erroneous 
factual basis, and, therefore, is inconsistent with Articles  2.1, 2.1(a),  and 2.4 of the 
SCM Agreement.141 
7.60.   The United  States argues that the USDO C appropriately factored into its analysis the 
operational link between the BPS and GP  programmes , and the subsidies provided under the SPS 
and COMOF programmes.142 The United  States argues that the investigation record did not contain 
evidence of any assistance received under the BPS and GP  programmes  based on entitlements from 
the national reserve or transferred entitlements.143 Moreover, according to the United  States, the  
fact that entitlements could have been transferred does not sever the reliance on the 
COMOF  programme that Spain  elected to incorporate into the SPS  programme , and by extension, 
 
135 Remand Redetermination, ( Exhibit  EU-80), p. 49. (emphasis added)  
136 Remand Redetermination, ( Exhibit  EU-80), p. 18. (emphasis  added ; original emphasis omitted ) 
137 Remand Redetermination, ( Exhibit  EU-80), p. 15 (emphasis  added) . For a similar explanation , see 
also FIDM, (Exhibit  EU-2), p.  36. 
138 European  Union's  first written submission, paras.  241-246. 
139 E.g. via inheritance, lease, purchase, or gift. (European  Union's  25 February  2021 response to Panel 
question No.  7, para. 58). 
140 European  Union's  first written submission, para. 245; 10  June 2020 response to Panel question 
No. 10, paras.  58-60; opening statem ent at the first meeting of the Panel , paras.  28 and 37; 
12 November  2020 response to Panel question No.  8, para. 42; and 25 February  2021 response to Panel 
question No.  3, paras.  22-23. 
141 European  Union's  first written submission, paras.  240 and 246; opening statement at the first 
meeting of the Panel , para. 43. 
142 United  States'  first written submission, para. 68. 
143 United  States'  12 November  2020 response to Panel question No.  4, para. 16. WT/DS 577/R  
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  the successor BPS and GP  programmes , as "only the legacy entitlement holders could apply for and 
receive the subsidy amounts reserved for that class of certain enterprises".144 
7.61.   We recall that the USDOC determined that subsidies provided to olive growers under the 
BPS programme  were de jure specific because it found that "acc ess to, and the amount of, benefits 
provided to olive growers  under the BPS, as a matter of law, relied for reference on the provision of 
benefits under the SPS and, in turn, access to and the amount of benefits provided to olive growers  
under the SPS was determined by reference to the benefits provided under the 
[COMOF  programme]".145 The USDOC arrived at this conclusion after examining the operation of the 
BPS programme , including the  rules governing the calculation of payment amounts. In its 
preliminary i ssues and decisi on memorandum, the USDOC explained its understanding of these rules 
in the following terms:  
The calculation begins with determining an "initial value,"  as instructed by Council 
Regulation (EC)  1307/2013 Article  26 and implemented by Royal D ecree 1076/2014.  
Under Regulation (EU)  1307/2013, Article  26 (3)  states that the initial value is  
{a} fixed percentage of the value  of the entitlements , including special 
entitlements, which the farmer held on the date of submission of his 
application for 2014 under  the single  payment  scheme , in accordance with 
Regulation (EC)  No 73/2009, shall be divided by the number of payment 
entitlements he is alloc ated in 2015, excluding those allocated from the 
national or regional reserves in 2015.  
The Spanish regulations regarding the implementation of BPS, Royal Decree 1076/2014, 
state that  
{f}or the calculation of the initial unitary value, the level of payment s 
received in the 2014 campaign, before deduction and exclusions, 
corresponding to the aid schemes paid in that campaign, amounts of which 
remain uncoupled or are partially or totally decoupled from 2015 onwards, 
shall be taken as a reference. These amount s correspond to the single 
payment scheme as a decoupled payment  … [.] 
Based on these regulations, a region's  value is the initial value multiplied by an 
adjustment coefficient divided by the number of hectares with entitlement values. These 
regulations al so state that the initial value is based on the amounts provided under SPS, 
the annual grant -to-farmer program in place prior to the implementation of the BPS in 
2015. These regulations also state that the adjusted coefficient incorporates into the 
equatio n the amount of payments received in 2014 under SPS. Therefore, the value that 
is divided by the number of eligible hectares to determine each region's value is based 
on the amount that farmer received per hectare in 2014 under SPS.146 
 
144 United  States'  12 November  2020 response to Panel question No.  4, para. 17; first written 
submission, para. 72. We note that the United  States  also argues that it is similarly irrelevant whether a farmer 
may have switched some or all of the production to a different cro p, as the group of enterprises for the 
purposes of the USDOC 's specificity analysis was the holders of entitlements whose entitlement values derived 
from the assistance during the COMOF  programme  reference period, whether olive growers or not. 
(United  States' opening statement at the first meeting of the Panel , para. 25; 10  June 2020 response to Panel 
question No.  6, para. 24). For reasons explained in section  7.2.2.3.2  of this Report, we have rejected this 
characterization of the USDOC 's determination, finding instead that the USDOC concluded that BPS subsidies to 
olive growers were de jure specific because "access to, and the amount of, benefits provided to olive growers 
under the BPS  programme , as a matter of law, relied for reference on the provision of benefits under the SPS 
and, in turn, access to and the amount of benefits provided to olive growers unde r the SPS was determined by 
reference to the benefits provided under the [COMOF programme] ". (Remand Redetermination,  
(Exhibit  EU-80), p. 15).  
145 Remand Redetermination , (Exhibit  EU-80), p.  15. 
146 PIDM, (Exhibit  EU-1), pp.  20-21. (emphasis  original ; fns omitted) WT/DS577/R  
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  7.62.   The USDOC went on to explain its understanding of how payment amounts to olive farmers 
were determined under the SPS  programme , by reference to the COMOF programme, and how under 
the COMOF programme payments were crop specific . It then concluded:  
In summary, the annual gran t amount provided to olive farmers under BPS is based on 
the annual grant amount provided to olive farmers under SPS. The grant amount 
provided to olive farmers under SPS is based on the average grant amount olive farmers 
received in 1999 through 2002 unde r the [COMOF] program. The grant amount provided 
in 1999 through 2002 to eligible farmers, which included olive farmers, was based on 
the type of crop grown and the production value created from the crop.  Therefore, the 
annual grant amount provided under B PS are based on annual grant amounts that were 
crop specific, thus the grant amounts received by olive growers under BPS in 2016 are 
directly related to the grant amount only olive growers received under [the COMOF] 
program. All respondents and many of the  olive growers that supply them, received 
benefits under this program during the [period of investigation] .147 
7.63.   The USDOC's  final issues and decision memorandum  confirmed its preliminary findings and 
repeated much of the analysis set out in the preliminary i ssues and decision memorandum verbatim , 
including the above -quoted excerpts from Article  26.3 of Regulation 1307/2013 and Royal Decree 
1076/2014148, and similarly explained:  
Based on these regulations, a region's value is the initial value multiplied by an 
adjustment coefficient divided by the number of hectares with entitlement values. These 
regulations also state that the initial value is based on the amounts provided under SPS. 
These regulations also state that the adjusted coefficient incorporates into t he equation 
the amount of payments received in 2014 under SPS. Therefore, the value that a farmer 
received per hectare in 2014 under SPS is used in calculating each region's  value.  
… 
In summary, the annual grant amounts provided to olive farmers under [ the 
BPS programme ] and [ the GP programme ] derive from the amount of SPS grants that 
were provided to each farmer in 2013. As explained above, the calculation of the grant 
amount under SPS retains the de jure specificity inherent in the [COMOF programme]. 
Therefore, the annual grant amounts provided under [ the BPS programme ] and [ the 
GP programme ] in 2016 are directly related to, and continue to retain the de jure 
specificity of, the grants provided to olive growers under the [COMOF programme].149 
7.64.   In the Remand Redetermination, the USDOC explained and elaborated its earlier 
determinations, expressing the same understanding of the rules governing the calculation of t he 
BPS payment entitlements:  
In its implementation of the BPS, the GOS, just as it did with the SPS program, [ sic] 
the eligibility criteria that limited access to benefits provided under the 
[COMOF  programme] were incorporated as a matter of law and embedd ed the historical 
differences in crop entitlement amounts among different agricultural products. As a 
result, farmers who received larger relative amounts of assistance under SPS continue 
to receive larger amounts of assistance under BPS. Therefore, the en titlement values 
under the BPS for those farmers that grow olives retain the historical difference, relative 
to other farmers , that was inherent in the [COMOF programme].150 
As explained above, benefits under the BPS were by law based on the benefits provid ed 
under the predecessor programs, which preserved the eligibility criteria for access to 
benefits provided under the [COMOF programme] and the historical differences in crop 
entitlement amounts among different agricultural products.151 
 
147 PIDM, (Exhibit  EU-1), p.  24. 
148 FIDM, ( Exhibit  EU-2), pp. 34-35. 
149 FIDM, ( Exhibit  EU-2), pp. 35-36. (fns omitted)  
150 Remand Redetermination, (Exhibit  EU-80), p.  18. (emphasis original)  
151 Remand Redetermination, (Exhibit  EU-80), p.  19. WT/DS 577/R  
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  To determine access to payments under the BPS, and the criteria or conditions 
governing the eligibility for, and the amount of the subsidy, the BPS legislation expressly 
refers to prior legislation and incorporates by reference the eligibility criteria from the 
prior legislat ion. An examination of the prior legislation explicitly referenced in and 
incorporated by the BPS demonstrates a linkage between eligibility for the crop -specific 
payments provided under the prior legislation and the current payments provided under 
the BPS . This link continued to entrench limited access and favored the olive industry.  
… 
The legislation governing the BPS program may not have explicitly stated that it 
intended to benefit olive growers; however, the BPS program expressly references prior 
legislation that dictates the access to and amount of BPS payments that, by law, 
provides expressly limited access to subsidies to olive growers. The SPS and 
BPS programs, by law, rely on "historical"  reference periods to preserve the benefit 
amounts provided t o growers of certain crops under predecessor programs. The GOS, 
as required by legislation, relied on volume, value, and area data, and prior subsidy 
amounts that were developed on a product -specific basis for the purpose of determining 
the amount of the s ubsidies provided to olive growers under the SPS, thereby preserving 
access to the subsidy that was expressly limited under the [COMOF programme]. 
Similarly, the GOS once again, by law, relied on a historical reference period to 
determine benefits under th e BPS program, and therefore, once again, by law, 
entrenched benefits received under these past programs on a crop -specific basis. By 
designing two consecutive benefit schemes in this manner, the express terms of the 
legislation pursuant to which the GOS o perates demonstrate that the GOS administers 
the current BPS payments to limit access to certain benefits to a subsector of the 
Spanish agricultural industry, olives.152 
7.65.   The European  Union  argues that the USDOC 's analysis and findings reflect a "simplistic " 
understanding of the BPS  programme  that misdescribes, and fails to properly account for the rules 
governing the allocation and calculation of the value of payment entitlements , including with respect 
to new farmers, farmers possessing transferred entitlem ents, and farmers no longer growing 
olives .153 We agree with the European  Union that the USDOC's  analysis and findings did not examine 
and properly account for record evidence that was relevant and important to understand how, as a 
matter of law, entitlemen t values were determined under the BPS  programme . 
7.66.   We note that under the relevant terms of the BPS  programme , as implemented by Spain, 
annual assistance in the form of direct payments was available in the period 2015 -2020 to any 
"farmer" activating payment entitlements obtained through one or more of the following 
avenues : (a) "first allocation" in 2015; (b)  allocation from the national or regional reserves; or 
(c) transfer of entitlements with or without land.154 The BPS  programme  defines a "farmer" as any 
natural or legal person undertaking "an agricultural activity", including not only production, rearing 
and growing of agricultural products, but also "maintaining an agricultural area in a state which 
makes it suitable  for grazing or cult ivation" or "carrying out a minimum activity, defined by Member 
States, on agricultural areas naturally kept in a state suitable  for grazing or cultivation".155 Thus, 
direct payments under the BPS  programme  were not conditioned on a requirement to produce o r to 
grow any crop.  Rather, to qualify for direct payments, a "farmer" must have obtained entitlements 
through any one or more of the above three ways, and those entitlements must have been 
activated.156 
 
152 Remand Redetermination, (Exhibit  EU-80), pp.  48-49. 
153 European  Union's  first written submission, para.  245; 10  June 2020 response to Panel question 
No. 10, paras.  58-60; opening statement at the first meet ing of the Panel , paras.  28 and 37; 
12 November  2020 response to Panel question No.  8, para. 42; and 25 February  2021 response s to Panel 
question No.  3, paras.  22-23, and No.  7, paras.  58-61. 
154 Regulation 1307/2013 , (Exhibit  EU-25), Articles  21.1 and 32.  
155 Regulation 1307/2013, (Exhibit  EU-25), Articles  4.1(a), 4.1(c), and 9.  
156 To activate payment entitlements, a farmer must submit an aid application on an annual basis by a 
due date, declaring the amount of payment entitlements the farmer holds together with the corresponding 
number of eligible hectares. (Regulation 1307/2013 , (Exhibit  EU-25), Articles  32 and 33 ). WT/DS577/R  
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  7.67.   Although the USDOC recognized that the BPS subsidies to olive growers were not tied to 
contemporaneous  olive production157, the relevance to its findings of the legal possibility of obtaining 
entitlements through any one or more of the three methods prescribed in the BPS  programme  is not 
examined in its deter minations. The USDOC's  analysis is focused on the rules for calculating the 
value of entitlements prescribed in Article  26 of  Regulation 1307/2013 and Spanish Royal Decree 
1076/2014, which implemented the BPS  programme . According to the USDOC, t hese rules prescribe 
that the starting point of the calculation (the "initial value" ) was a function of the value of 
SPS entitlements held by the relevant farmer.  We note, however, that the value of entitlements 
obtained from the "national or regional reserves" was d etermined under a different  set of provisions  
of Regulation 1307/2013 and Spanish Royal Decree 1076/2014. E ntitlements obtained from the 
national or regional reserves were available to all qualifying farmers, but were to be used, as a 
matter of priority, to facilitate the participation of young farmers and farmers commencing their 
agricultural activity.158 In Spain, the per unit value of entitlements from the national reserve for new 
or young farmers was set at the average  value  of all payment ent itlements in the region of such 
farmer in the year of allocation.159 This indicates that, as a matter  of law, the BPS  programme  
prescribed that the value of BPS payments to young and new farmers (including, potentially, new 
olive growers ) was not directly t ied to the value of SPS entitlements. The BPS  programme , therefore, 
provided for the possibility that the value of entitlements obtained by such farmers would not be 
derived from the value of previously held SPS entitlements. In our view, the absence of an y 
discussion or assessment of this feature of the BPS  programme  in the USDOC's  analysis undermines 
the USDOC's  determination that BPS payments to olive growers were de jure specific because 
"access to, and the amount of, benefits provided to olive growers  under the BPS  programme , as a 
matter of law, relied  for reference  on the provision  of benefits  under  the SPS".160 
7.68.   Turning to the BPS calculation rules, we note that after quoting Article  26(3)  of the 
BPS programme  in its preliminary issues and decision memorandum, the USDOC referred to a 
passage from Royal  Decree  1076/2014. According to the USDOC, the regulations revealed that "the 
initial value is based on the amounts provided under SPS", leading the USDOC to conc lude that "the 
amount of assistance provided under [ the BPS programme ] and [ the GP programme ], is based on 
the annual grant amount provided per hectare under SPS".161 However, the full text of the passage 
from Royal Decree 1076/2014 quoted by the USDOC reve als that, as implemented by Spain, the 
value of entitlements was to be determined not only as a function of payments received under the 
SPS programme : 
For the calculation of the initial unitary value, the level of payments received in the 
2014 campaign, be fore deductions and exclusions, corresponding to the aid schemes 
paid in that campaign, amounts of which remain uncoupled or are partially or totally 
decoupled from 2015 onwards, shall be taken as a reference. These amounts correspond 
to the single payment  scheme as a decoupled payment and a certain  percentage  of the 
payments  received  for the suckler  cow premium  and the supplementary  premium  for 
the suckler  cow, payments  received  on the basis of the national  program  for the 
promotion  of crop rotations  in dry agricultural  land, payments  received  on the basis of 
the national  program  for the promotion  of tobacco  quality  and payments  received  on 
the basis of the national  program  for the promotion  of cotton  quality,  as payments  that 
become  decoupled  in the new period.162 
 
157 See para. 7.52 above.  
158 Regulation 1307/2013 , (Exhibit  EU-25), Article  30.6. See also Royal Decree 1076/2014 , 
(Exhibit  EU-30), Article  24. 
159 Article  26.1 of Royal Decree 1076/2014 , (Exhibit  EU-30), which provides that the value of such 
payment entitlements "will correspond to the average regional value of the entitlements in the year of 
allocation", and that "[t]he regional averag e value shall be calculated by dividing the regional ceiling 
corresponding to the basic payment for the year of allocation, by the total number of entitlements allocated for 
that region". The regional average values are set out in Order AAA/1747/2016, ( Exhibit EU-32). See also 
Regulation 1307/2013 , (Exhibit  EU-25), Article  30.8; and GOS's response to supplemental questionnaire of 
10 January  2017, ( Exhibit  EU-15), p p. 32-42, reproducing the relevant Spanish rules concerning payment 
entitlements from the nati onal reserve and explaining that "the main difference with the normal 
BPS programme  is that the value of the entitlements generated by the National Reserve if from the beginning 
the average value of the region where the entitlements is [ sic] allocated". See also Newsletter No. 2, Basic 
payment entitlement allocation , (Exhibit  EU-31). 
160 Remand Redetermination, ( Exhibit  EU-80), p. 15. (emphasis  added)  
161 PIDM, (Exhibit EU -1), pp.  20-21. 
162 Royal Decree  1076/2014, (Exhibit  EU-30), pp.  3-4. (empha sis added)  WT/DS 577/R  
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  7.69.   This accords with the European  Union's  assertion that Article  26.6 of Regulation  1307/2013  
and Article  13 of Royal Decree 1076/2014 established that the payment amounts to be taken into 
account for the purpose of calculati ng the "initial value" of BPS entitlements include d not only 
payments made under the SPS  programme  in 2014 , but also payments made in the same year 
pursuant to a number of previously coupled aid schemes. For Spain, t he previously coupled 
payments were  defined  as 51.32% of the suckler cow premium, the rain -fed rotation programme 
premium, the cotton quality premium, and the tobacco quality premium . In our view, these 
provisions reveal that the value of BPS payments could be determined based on payments received 
under programmes other  than the SPS  programme . The USDOC's  determinations do not discuss the 
relevance of this aspect of the BPS calculation rules to its finding of de jure specificity, even despite 
the fact that during the investigation, the GOS provided the USDOC with information showing that 
the BPS payments for one of the mandatory respondents or its unaffiliated supplier  was determined 
taking into account payments received under the natio nal programme for the promotion of cotton 
quality.163 Nevertheless, we do not find the absence of any discussion of this feature of the 
BPS programme  in the USDOC's  determination to undermine the USDOC's  findings of de jure 
specificity because, ultimately, as already noted, the USDOC's  findings were driven by the view that 
the availability of COMOF  programme -based  payments  via the SPS programme  was, as a matter of 
law, limited to olive growers. The fact that olive growers may have received BPS payments for 
non-olive growing  activities under different programmes does not undermine the USDOC's  position.  
7.70.   We note, furthermore, that while the relevant BPS calculation rules envisage that the value 
of SPS entitlements would be used to establish the "initial value" o f a farmer's  BPS entitlements, the 
corresponding rules of the SPS  programme  did not prescribe that the value of all such entitlements 
for olive growers were to be necessarily determined with reference to the COMOF programme.  
7.71.   Assistance under the SPS  progra mme was available to any "farmer" holding entitlements 
obtained  (a) during the relevant reference period under at least one of several prior support schemes  
(which included the COMOF programme) ; (b) by transfer or inheritance ; or ( c) from the national 
reserve.164 This means that under the calculation rules of the BPS  programme , the "initial value" of 
entitlements of a farmer that received assistance under the SPS  programme  was, at least in part165, 
a function of the value of entitleme nts received via one or more of the above three methods. Thus, 
any SPS -based entitlements used to determine the "initial value" of an olive farmer's  entitlements 
under the BPS  programme  do not appear to have been limited, as a matter  of law, to those obtai ned 
through the operation of the COMOF programme. This is because it was legally possible for an olive 
farmer to obtain SPS entitlements by other means – namely, via transfer from a farmer of other 
products, or from the national reserve.  
7.72.   When an SPS entit lement was obtained by transfer, the original source of that entitlement 
could have been a support programme other than the COMOF  programme , as in addition to olives, 
the previously existing support schemes relevant for establishing the initial value of th e payment 
entitlements under  the SPS  programme  included programmes providing assistance for arable crops, 
potato starch, grain legumes, rice, seeds, beef and veal, milk and milk products , sheep meat and 
goatmeat, dried fodder, cotton, tobacco, hops, sugar b eet, cane and chicory used for the production 
of sugar or inulin syrup, and bananas .166 This suggests that , as a matter of law, the "initial value" 
of an olive grower 's BPS entitlements could have been derived from non -COMOF programme -based 
SPS entitlements previously obtained via transfer  from, for example,  a cotton farmer . Conversely, 
the "initial value" of the BPS entitlements of a farmer that did not grow olives (for example, a grower 
 
163 European  Union's  first written submission, fn 101 (referring to GOS's response to supplemental 
questionnaire of 10  January  2017, (Exhibit  EU-15), point A.2, p . 18). 
164 Regulation 1782/2003, ( Exhibit  EU-24), Article  33. Under the SPS  programme , a newcomer could 
obtain a payment entitlement either from the reserve (Regulation 1782/2003, ( Exhibit  EU-24), Article  42.3; 
Regulation 73/2009, ( Exhibit  EU-23), Article  41.2), or by transfer (lease, sale, or inheritance ) within the same 
member S tate (Regulation 1782/2003, ( Exhibit  EU-24), Article  46; Regulation 73/2009, ( Exhibit  EU-23), 
Article  43). According to the European  Union , since Spain did not implement the SPS programme  on a regional 
basis (unlike the BPS programme , as explained below), a farmer could sell, buy , or rent SPS entitlements and 
activate them in any eligible hectare in Spain.  (European  Union's  25 February  2021 response to Panel question 
No. 7, paras.  63-64). 
165 We recall that under the BPS  programme , as implemented by Spain, th e "initial value" of 
entitlements was to be determined not only as a function of 2014 SPS payments, but also payments made in 
the same year pursuant to a number of previously coupled aid schemes.  
166 Regulation 1782/2003 , (Exhibit  EU-24), Article  37 and Annex  VI. See also European  Union's  first 
written submission, para. 79. WT/DS577/R  
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  of citrus fruits ) could have also been derived from COMOF  programme -based SPS entitlements 
previously transferred from an olive grower.167 In our view, these considerations suggest that the 
BPS programme  did not legally tie the "initial value" of BPS entitlements for olive growers to the 
value of SPS  entitlements derived from the COMOF  programme assistance. While COMOF 
programme -based SPS entitlements may have served, as a matter  of fact, as the basis for calculating 
the value of an olive grower's  BPS entitlements, the BPS  programme  does not make this a legal 
requirement. Rather, when considered in the light of the relevant SPS rules discussed above, the 
BPS programme  appears to leave open the possibility that the "initial value" of an olive grower's  BPS 
entitlements could be determined as a function of SPS entitlem ents that were not derived from the 
COMOF programme. Likewise, when considered in the light of the same SPS rules, the BPS  
programme  also seems to envisage that COMOF programme -based SPS entitlements could be 
enjoyed by any farmer (not only olive growers)  that had previously obtained those entitlements via 
transfer under the SPS  programme . In our view, these considerations suggest that the BPS  
programme  did not legally  limit the class of farmers that may benefit from  the COMOF 
programme -based SPS  programme , and by extension, BPS entitlements to olive growers. However, 
this aspect of the rules governing the allocation and calculation of BPS entitlements was not 
discussed or ex amined in the USDOC's  determination of de jure specificity.168 
7.73.   The United  States argues that t he fact that entitlements could have been bought, rented, or 
inherited does not sever the reliance on the COMOF programme that Spain  elected to incorporate 
into th e SPS programme, and by extension, the successor BPS programme.169 As already noted, 
however, the fact that COMOF programme -based SPS entitlements could be transferred under the 
SPS programme  to farmers that did not grow olives suggests that access to, and the amount of, 
BPS entitlements derived from COMOF programme -based SPS entitlements was not legally limited 
to olive growers. Moreover, the fact that it was open under the SPS  programme  for olive farmers to 
obtain entitlements derived from non -COMOF progra mmes by way of transfer, suggests that 
BPS payments to the same olive farmers could be derived from programmes other than the COMOF 
programme.  
7.74.   Finally, we recall that to qualify for BPS assistance, a farmer was not required to produce any 
agricultural prod uct. The same is true for assistance under the SPS  programme , which defined a 
"farmer" as any natural or legal person undertaking "an agricultural activity", including not only 
production, rearing and growing of agricultural products, but also "maintaining  the land in good 
 
167 While the United  States  argues that only the holders of legacy entitlements based on historic olive 
production subsidies could apply for and receive the subsidy amounts reserv ed for that class of certain 
enterprises ( United  States'  11 March  2021 comments on the European  Union's  25 February  2021 response to 
Panel question No.  7, para. 36), nothing in the SPS or BPS rules limits such transfers to transactions between 
olive grower s, making a transfer between an olive grower and a citrus fruits grower possible, as a matter of 
SPS or BPS legislation (subject to the rule that under the BPS programme  in Spain, transfer is allowed within a 
region). Such transfer would, in turn, provide the citrus fruits grower with access to the subsidy amounts 
based on COMOF -related assistance, altering the scope of such access, contrary to the 
United  States'  argument.  
168 In our view, the same holds true in the context of the possibility to transfer paym ent entitlements 
under the BPS  programme. The relevant BPS rules, as implemented by Spain, provide that BPS entitlements 
may be transferred (via sale, lease, or any other form foreseen by law)  with or without land to any active 
farmer within the same regio n (as defined by Spain for the purpose of implementing the BPS  programme). This  
indicates that, as a matter  of law, an olive grower 's BPS entitlements could have been  obtained via transfer  
from a non -olive grower (provided that the two farmers are in the same region) . Conversely, the value of 
BPS entitlements of a farmer that did not grow olives could have been derived from COMOF -based assistance, 
if transferred from an olive grower in the same region (assuming that the olive grower held COMOF -based 
SPS entitlements and subsequently obtained BPS entitlements via first allocation, meaning that the value of 
such BPS entitlements could, theoretically, be traced back to the COMOF programme). In our view, these 
considerations also suggest that the BPS legisl ation did not legally tie the value of BPS entitlements for olive 
growers to assistance received under the COMOF programme. While COMOF -based assistance may have been, 
as a matter  of fact, the basis for calculating the value of an olive grower's  SPS entitl ements, and, in turn, this 
SPS assistance may have been the basis for calculating the value of an olive growers'  BPS entitlements, the 
BPS legislation did not make this a legal requirement. The fact that it was legally possible to transfer any 
potentially existing COMOF -SPS-based entitlements to non -olive farmers under the BPS programme , suggests 
that the BPS  programme did not explicitly limit access to the COMOF -based payments to olive growers. Other 
farmers could have obtained and benefited from such enti tlements by transfer in the same way as olive 
growers holding the same entitlements. (Regulation 1307/2013,  (Exhibit  EU-25), Article  34; Royal Decree 
1076/2014 , (Exhibit  EU-30), Article  28. See also European  Union's  first written submission, paras.  111(b)  and 
148, and fn 94; and 25  February  2021 response to Panel question No.  7, para.  60). 
169 United  States'  first written submission, para. 72. WT/DS 577/R  
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  agricultural and environmental condition".170 Pursuant to the relevant legislation, SPS and  
BPS assistance was not conditioned on the production of any agricultural product. This  indicates 
that, as a matter  of law, it was entirely possible  for a "farmer" to benefit from 
COMOF  programme -based entitlements derived from prior olive production , even if it no longer 
produced olives during the period of operation of the relative programmes (either because, for 
example, it switched to growing a different crop or decided to pursue other qualifying farming 
activities). This is yet another feature of  the relevant rules that suggests that the BPS  programme  
did not, as a matter  of law, limit the potential to benefit from COMOF  programme -based entitlements 
to olive growers.  
7.75.   In our view, the above -examined features of the rules governing the allocation an d calculation 
of BPS entitlements for new olive farmers, farmers with entitlements obtained via transfer under the 
SPS programme , and farmers holding COMOF programme -based SPS entitlements no longer 
producing olives, were relevant to the USDOC's  determinat ion of de jure specificity and should have 
formed part of the USDOC's  analysis. The fact that the calculation rules specified that the value of 
BPS entitlements for new farmers  (including, potentially new olive farmers)  obtained from the 
national reserve w ere to be based on the average value of payments to farmers in the same region 
(not the value of SPS entitlements), indicates that, as a matter  of law, BPS payments to olive farmers 
were not tied to the historical COMOF programme -based olive production. Th at the respondents or 
their unaffiliated suppliers in the USDOC's  investigation may not have been "new farmers" and may 
not have received payments from the Spanish national reserve, as a matter  of fact171, does not 
mean that the BPS  programme  legally  tied a ccess to, and the amounts of, BPS payments for olive 
growers to COMOF  programme -based SPS entitlements. Likewise, the fact that it was legally possible 
to transfer  COMOF  programme -based  SPS entitlements  to non-olive farmers  under  the 
SPS programme , suggests that the calculation rules of the BPS  programme  did not explicitly limit 
access to the COMOF programme -based portion of a BPS payment to olive growers. Other farmers 
could have obtained such entitlements by transfer under the SPS  programme  and the n subsequently 
benefited from those under the BPS  programme  in the same way as olive growers holding the same 
entitlements. Finally, because crop production was not a precondition for a farmer to receive 
BPS payments, it was also legally possible for a far mer that obtained COMOF  programme -based 
SPS entitlements during the operation of the SPS  programme  to continue to benefit from those 
entitlements even if no longer  producing  olives  in the BPS period.  
7.76.   In conclusion, therefore, we find that the USDOC did not  properly examine and account for 
the above -mentioned features of the rules governing the allocation and valuation of BPS entitlements 
in its determination of de jure specificity.  
7.2.2.3.4   The USDOC's  rejection  of arguments  concerning  the "convergence " factor  
7.77.   The E uropean  Union argues that in establishing a link between the grant amounts under the 
SPS and BPS/GP  programme s, the USDOC improperly rejected arguments concerning the annual 
adjustment of the value of each BPS payment entitlement to ensure convergence between farmers 
within Spanish regions .172 According to the European  Union, the fact that the BPS  programme  
prescri bed annual adjustments to achieve  such convergence,  when considered in the light of the 
other rules affecting the allocation and calculation of BPS entitlements, shows that there was only a 
remote connection between the BPS and SPS  programmes  (and the COMO F programme)  payments, 
thereby undermining the USDOC's  determination of de jure specificity.173 The European  Union 
maintains that the logic of the USDOC's  view that the application of the convergence factor could 
not alter its finding of de jure specificity , simply because the initial value of an olive 
farmer's  entitlement may have been derived from the SPS and the COMOF programme s, necessarily 
implies that such payments must always be de jure specific, regardless of the level of adjustment 
applied to harmon ize them and distance them from the previous "coupled" payments.174 The 
 
170 Regulation 1782/2003, ( Exhibit  EU-24), Articles  2(a), 2(c), and 5; Regulation 73/2009, 
(Exhibit  EU-23), Articles  2(a), 2(c), and 6.  
171 United  States'  12 November  2020 response to Panel question No.  4, paras.  16-17; 11  March  2021 
comments on the European  Union's  25 February  2021 response to Panel question No. 7, para. 34. 
172 European  Union's  first written submi ssion, paras.  245, 247, and 296. "Spanish regions" refer to 
50 regions defined by Spain for the purpose of implementing the BPS programme.  
173 European  Union's  first written submission, para. 245; 25  February  2021 response to Panel question 
No. 3, para. 20 (referring to the European  Union's  first written submission, paras.  105-106, 124 -128, and 
145-147). 
174 European  Union's  first written submission, paras.  248-251. WT/DS577/R  
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  European  Union argues that the USDOC's  findings with respect to the issue of convergence were 
results -oriented and did not reflect the assessment of an objective and unbiased investigat ing 
authority.175 Accordingly, the European  Union claims that the USDOC's  determination of de jure 
specificity was, to this extent, inconsistent with Articles  2.1, 2.1(a ), and 2.4 of the SCM  Agreement.  
7.78.   The United  States argues that the European  Union mischaracterizes the USDOC's  findings. 
According to the United  States, the USDOC did not find that de jure specificity could never be 
removed by application of the convergence factor, and explained why it found unavailing the 
arguments concerning the convergence factor.176 The United  States refers to the 
USDOC's  explanations and argues that it would have been premature for the USDOC to find that the 
application of the convergence factor eliminated the differ ences in assistance carried over from the 
COMOF programme for the period of investigation (from 1  January  2016 to 31  December  2016), 
since the convergence of the amounts of payment entitlements has been taking place over 
five stages from 2015 to 2019.177 The United  States further argues that, in light of the convergence 
method implemented by Spain, the convergence factor will not result in the complete elimination of 
the differences in the amounts of assistance , and that Spain's  choice of the convergence app roach 
"underscores" that the BPS  programme  in Spain has not eliminated the de jure specificity of the 
COMOF programme.178 
7.79.   The USDOC first discussed  the application of the convergence factor in the final issues and 
decision memorandum when responding to inte rested party arguments:  
Moreover, we find unavailing the arguments that the application of a convergence factor 
over time is eliminating the disparities in payments among recipients and, therefore, 
the possibility of finding the assistance specific to oliv e growers. We understand that 
the application of the convergence factor results in adjustments to individual payments 
to bring them closer to an average over time by reducing the highest payments and 
increasing the lowest payments. However, the convergence  factor is applied to 
payments to olive growers that retain the specificity inherent in the 
[COMOF  programme]. Therefore, while any adjustments resulting from convergence 
may ultimately affect the final amount of assistance, the grant amounts awarded to 
farmers under the BPS program are still based on, and thus retain, the de jure specificity 
of prior programs as explained above.179 
7.80.   In the Remand Redetermination, the USDOC recalled and elaborated its explanations 
concerning the convergence factor as follows:  
Although the convergence factor was intended to bring the value of assistance to each 
farmer closer to the regional averages, it will not completely eliminate the differences 
in assistance. The BPS, as developed by the EU, gave Member States options for h ow 
to effect convergence; Spain elected not to use a flat rate multiplied by the number of 
eligible hectares, but rather elected to use the convergence step that it recognized 
would gradually reduce, but would not eliminate, the disparity in grant amounts.  
[The USDOC]  found unavailing the argument that the application of a convergence 
factor eliminated the possibility of finding the assistance specific to olive growers.180 
The application of several adjustment factors, including the convergence factor and the 
across -the-board budgetary reduction cited by the GOS, seeks to align all 
farmers ' payments with a regional average. However, as we did in the Final 
Determination , we continue to find parties ' arguments on this matter to be unavailing . 
The GOS 's explan ation only serves to highlight the fact that even through the end of 
the operation of the BPS in its current form, at the end of 2019, there will continue to 
 
175 European  Union's  first written submission, paras.  294-296 and 329 ; opening statement at the first 
meeting of the Panel , paras.  62 and 75.  
176 United  States'  first written submission, paras.  74 and 94; 11  March  2021 comments on the 
European  Union's  25 February  2021 response to Panel question No.  3, para. 10. 
177 United  State s' first written submission, para. 74; 11  March  2021 comments on the 
European  Union's  25 February  2021 response to Panel question No. 3, para. 10. See also United  States'  first 
written submission, para. 94. 
178 United  States'  first written submission, para. 75. See also ibid. para. 94. 
179 FIDM, (Exhibit  EU-2), p.  36. 
180 Remand Redetermination, (Exhibit  EU-80), fn  60. WT/DS 577/R  
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  be broad disparities in the assistance provided to farmers under the BPS. Farmers whose 
payments a re above the average will have their payments reduced over time by 
30 percent; farmers whose payments are less than 60 percent of the average will have 
their payments increased over time to reach the 60 percent target. In application, 
farmers who historica lly received the highest payments will continue to receive the 
highest  payments (which, although even when reduced by the full 30 percent applicable, 
could remain well above the target of 60 percent of the average), and farmers who 
historically received th e lowest payments will continue to receive the lowest payments, 
capped at 60 percent of the average. We continue to find that these factors support our 
conclusion in the Final Determination , and in this redetermination, that access to the 
subsidy for olive  growers is limited such that the BPS program is de jure specific.181 
7.81.   Before addressing the merits of the European  Union's  complaint against the 
USDOC's  findings, we first set out our understanding of the convergence process operating in Spain. 
In short, Ar ticle 25 of Regulation 1307/2013, as implemented in Spain by Article  16 of 
Royal  Decree  1076/2014, required that the initial value of BPS entitlements were to be adjusted 
over time with a view to bringing them closer to average regional values.182 Spain cho se to apply 
the "tunnel model" of convergence183, which sought to ensure that payment entitlements above and 
below a regional average would respectively decrease and increase over time toward s that average. 
Through this mechanism, entitlements with an initi al unit value lower  than 90% of the regional 
average value  in 2019184 were to  increase , in five equal steps beginning in 2015185, by a total of 
one-third of the difference between their initial value and 90% of the regional average  in that year .186 
Thus, for example, for a regional average value of 100 EUR/ha., a farmer holding payment 
entitlements with an initial value of 60 EUR/ha. would see the value of those entitlements gradually 
increase in five equal steps by a total of 10 EUR/ha. (one -third of the difference between 90% of 
the regional average value – i.e. 90 EUR/ha. – and the initial value of the farmers'  entitlements), 
resulting in the following annual increases:  
Table 1: Annual increases of entitlements  
2015  2016  2017  2018  2019  
62 EUR/ha.  64 EUR/ha.  66 EUR/ha.  68 EUR/ha.  70 EUR/ha.  
Source:  Hypothetical calculation based on Newsletter No. 2, Basic payment entitlement allocation, 
(Exhibit  EU-31), example No. 1. 
7.82.   The increase in payments to effect this convergence was to be financed by reduction s in the 
initial value of entitlement s above  the regional average, with the maximum deduction  for such 
entitlements  capped at 30%.187 Thus, in the context of the same example  set out above, a farmer 
holding payment entitlements with an initial value above  100 EUR/ha would see the value of those 
entitlements decrease, by no more than 30%, in order to finance the increase of entitlement 
values.188 
 
181 Remand Redetermination, ( Exhibit  EU-80), p p. 66-67, where the USDOC responded to comments of 
the GOS on the draft redetermination. ( fns omitted)  
182 Regulation 1307/2013, (Exhibit  EU-25), Article  25; Royal Decree 1076/2014, (Exhibit  EU-30), 
Article  16. 
183 European  Union's  first written submission, para. 125 and fn 104 (referring to EC internal 
convergence document, ( Exhibit  EU-18)). 
184 The regional average values are set out in Order AAA/1747/2016, ( Exhibit  EU-32). See  also 
European  Union's  first written submission, para. 139. 
185 Regulation 1307/2013, (Exhibit  EU-25), Article  25.8; Royal Decree 1076/2014, (Exhibit  EU-30), 
Article  16. See also European  Union's  first written submission, paras.  127 and 146.  
186 Regulation 1307/2013, (Exhibit  EU-25), Article  25.4; Royal Decree 1076/2014, (Exhibit  EU-30), 
Article  16. See also European  Union's  first written submission, paras.  126 and 146. Moreove r, the relevant 
rules also prescribed that no payment entitlement in 2019 could have a unit value below 60% of the average 
regional unit value of the payment entitlements in 2019, thereby guaranteeing a minimum convergence 
regardless of the difference betw een the initial payments and the regional average. (Regulation 1307/2013 , 
(Exhibit  EU-25), Article  25.4; Royal Decree 1076/2014, ( Exhibit  EU-30), Article  16). 
187 For a specific (hypothetical ) example of an upward convergence, see European  Union's  first writ ten 
submission, paras.  127 and 146  (referring to Regulation 1307/2013, (Exhibit  EU-25), Article  25.7; and 
Royal  Decree 1076/2014 , (Exhibit  EU-30), Article  16). 
188 For a specific (hypothetical ) example of a downward convergence, see Newsletter No. 2, Basic 
payment entitlement allocation, ( Exhibit  EU-31), example No. 2. WT/DS577/R  
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  7.83.   We note that  the focus of the European  Union's  criticism of the USDOC's  findings with respect 
to convergence is the USDOC's  alleged view that the prescribed adjustments were applied to an 
entitlement value that was, in the first place, tied to historic olive productio n under the 
COMOF  programme, thereby continuing the alleged de jure specificity of that programme, regardless 
of the adjustment. In our view, however, this would not be an accurate characterization of the 
reasons underlying the USDOC's  rejection of the arg uments concerning the convergence factor.  
7.84.   In the final issues and decision memorandum the USDOC not only identified the alleged 
existence of a continued connection between entitlement values and the COMOF programme, 
notwithstanding the convergence process,  but it also recognized that adjustments would not lead to 
equality of payments – only convergence toward s a regional average.  This, we believe, follows from 
the USDOC's  stated understanding of the impact of the application of the convergence factor to 
individual payments, which we recall was that it would "bring them closer  to an average  over time 
by reducing the highest payments and increasing the lowest payments".189 This USDOC 
understanding was elaborated in the Remand Redetermination, where the USDOC ex plained that 
under the convergence model implemented by Spain differences in the amounts of assistance would 
not be completely eliminated by 2019. In particular, the USDOC found that:  (a) the  application of 
the convergence factor " will not completely elimi nate the differences in assistance "190; (b) "Spain 
elected not to use a flat rate multiplied by the number of eligible hectares, but rather elected to use 
the convergence step that it recognized would gradually reduce, but would not eliminate, the 
disparity  in grant amounts "191; and (c)  "at the end of 2019, there will continue to be broad disparities 
in the assistance provided to farmers under the BPS ".192 To the extent that these USDOC statements 
reveal that it considered the convergence process in Spain was not designed to completely eliminate 
disparities between BPS payments, we find them to accurately reflect the rules governing the 
convergence process,  as implemented by Spain.  
7.85.   Thus, we find that the logic underlying the USDOC's  rejection of the arguments concerning 
the convergence factor was not simply that BPS payments to olive growers continued to be based 
on the SPS and the COMOF programmes, irrespec tive of adjustments. Although the USDOC made a 
statement to this effect in its findings, it also pointed out that the convergence process, as 
implemented by Spain, would not result in equivalence or removal of disparities in payments, which 
in the case of olive growers relative to other farmers the USDOC considered resulted from an alleged 
connection with the COMOF programme. In our assessment, it was the combination of both 
considerations that led the USDOC to dismiss the arguments concerning the impact of  the 
convergence process on the "specificity" of BPS payments. We note, furthermore, that the USDOC 
expressed no opinion about whether any other type of convergence model193 could potentially 
remove the disparities it found to result from the way BPS paymen ts were calculated in Spain.  Thus, 
we do not agree with the European  Union's  submission that the logic of the USDOC findings implies 
that it was of the view that BPS payments will always be de jure specific, regardless of the level of 
adjustment applied to  harmonize them.  
7.2.2.3.5   The USDOC's  analysis  and findings  with respect  to the "regional  rate" 
7.86.   The European  Union argues that additional errors in the USDOC's  appreciation of the legal 
framework of the BPS  programme  that affected its findings of de jure specificity can be found in the 
USDOC's  analysis and findings with respect to the "regional rate". According to the European  Union, 
the USDOC's  finding that a "regional rate" was "used to determine the value of each h ectare of 
farmland 's 'basic payment entitlement'" reveals a "serious misunderstanding" of the functioning of 
the BPS  programme , because under the BPS  programme , the value of the payment entitlements 
depends upon the amount of support received by a farmer i n the previous period, and is not tied to 
any "regional rate".194 Moreover, the European  Union maintains that the USDOC was also incorrect 
when it found that " each basic payment entitlement amount will be weighted by the regional 
reference value to which it  corresponds ", because the European  Union asserts that the regional 
 
189 FIDM, ( Exhibit  EU-2), p. 36. (emphasis  added)  
190 Remand Redetermination, ( Exhibit  EU-80), fn 60. 
191 Remand Redetermination, ( Exhibit EU-80), fn 60. 
192 Remand Redetermination, ( Exhibit  EU-80), p. 66. 
193 The European  Union  explains that Regulation 1307/2013, (Exhibit  EU-25) allows member States to 
choose between three different convergence models : the flat rate from 2015, the flat rate by 2019, and the 
tunnel model (implemented by Spain). (European  Union's  first written submission, para. 125 and fn 103 
(referring to EC internal convergence document , (Exhibit  EU-18))). 
194 European  Union's  first written submission, paras.  301-302. WT/DS 577/R  
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  coefficient only applies when a farmer has lands in different regions to distribute the total value 
among those regions.195 The European  Union argues that these alleged errors of appreciati on 
demonstrate that the USDOC's  determination was not reasonably and adequately explained, and 
that it was grounded on an erroneous factual basis and, therefore, inconsistent with Articles  2.1, 
2.1(a),  and 2.4 of the SCM  Agreement.196 
7.87.   The United  States  maintains that the European  Union's  submissions concerning the 
USDOC 's statements with respect to the regional coefficient do not undermine the 
USDOC 's determination. The United  States  notes that the USDOC did not, in its final determination , 
elaborate upon th e application of the regional coefficient in the circumstances where a farmer 's lands 
are located in more than one region. However, according to the United  States , such a distinction 
does not change the fact that the amount of assistance under the BPS programme  is related to the 
de jure specific assistance allegedly provided under the COMOF programme .197 The United  States  
furthermore submits that  even though the regional coefficient was not applied for every farmer, it 
was nevertheless "1" for permanent crops such as olives , implying that even where it did come into 
play, " it would effect no reduction, and guarantees, in the assistance allocated to olive growers ".198 
7.88.   The European  Union's  submissions concern the italicized text in the foll owing passages of the 
USDOC's  determination, as set out in the preliminary and final issues and decision memoranda:  
To create each region, Spain used "the agricultural district, as a geographical reference 
unit … known by the agricultural sector, in which municipalities with similar agronomic 
characteristics  are grouped together " as an administrative criterion. Each 
region 's territorial definition is  based on "their productive potential and the productive 
orientation determined in the 2013  campaign  …" and t his "productive orientation " is 
categorized as "rainfed land, irrigated land, permanent crops and permanent pastures." 
Olive groves are considered permanent crops. This territorial definition determines each 
region's "regional rate," which is used to deter mine the value of each hectare of 
farmland's "basic payment entitlement." Because of this, each basic payment 
entitlement amount will be weighted by the regional reference value to which it 
corresponds.199 
Each region has shared agronomic characteristics an d a territorial definition based on 
its "productive potential and the productive orientation determined in the 2013 
campaign  … ." This "productive orientation" is categorized as "rainfed land, irrigated 
land, permanent crops and permanent pastures;" olive groves are considered 
permanent crops. This territorial definition determines each region's "regional rate," 
which is used to determine the value of each hectare of farmland's "basic payment 
entitlement." As a result, each basic payment entitlement amount is weighted by the 
regional reference value to which it corresponds .200 
7.89.   As the European  Union  asserts, Article  14.2(b)  of the Spanish Royal Decree 1076/2014 and 
Order AAA/544/2015 together explain that a farmer's  BPS payments would be multiplied by a 
releva nt coefficient in situations  where  a farmer  declares  areas in more than one region .201 
The purpose of applying this coefficient was not to determine the intrinsic value of a 
farmer's  entitlements, but rather to allocate a farmer's  total eligible payments between the different 
regions in which it holds land, based on objective and non -discriminatory criteria. This coefficient, 
described by the USDOC as the "regional rate" and the "regional reference value", was not used to 
determine "each hectare o f farmland's  'basic payment entitlement'"; nor was it used to weight a 
farmer's  basic payment entitlement. Accordingly, the above -quoted USDOC's  findings with respect 
to the role played by the "regional coefficient" are factually incorrect.  
 
195 European  Union's  first written submission, para. 304. 
196 European  Union's  first written submission, para. 329; opening statement at the first meeting of the 
Panel , para. 76. 
197 United  States'  first written submissi on, para. 96. 
198 United  States'  first written submission, para. 96. 
199 PIDM, ( Exhibit  EU-1), pp. 19-20. (emphasis  added; fns omitted)  
200 FIDM, ( Exhibit  EU-2), p. 34. (emphasis  added; fns omitted)  
201 European  Union's  first written submission, paras.  303-304 (referring to Royal Decree 1076/2014, 
(Exhibit  EU-30), Articles  14.2(a ) and 14.2(b ); and Order AAA/544/2015 , (Exhibit  EU-21)). WT/DS577/R  
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  7.90.   The United  States argues that these  alleged  errors in the USDOC's  factual assessment do not 
undermine its ultimate determination. In our view, however, the following paragraphs  from the 
explanation of the USDOC's  original findings in the Remand Redetermination suggest th at the 
USDOC did, in fact, rely upon its appreciation of the role of the "regional rate" in the calculation of 
BPS payments:  
In implementing the BPS, Spain used the data collected under the SPS to create 
50 agricultural regions to facilitate payments. Each  region was assigned a rate based 
on its productive potential and its productive orientation ( i.e., rainfed, irrigated, 
permanent crops, and permanent pasture). Olive groves are considered "permanent 
crops" and this designation is factored into the calcula tion of the regional rate, which, 
in turn, is used to determine each hectare of farmland 's "basic payment entitlement" 
and whether, and to what extent, a farmer was eligible to receive grants under the BPS . 
Thus, [the USDOC]  concluded that the regional var iations in BPS payments were a result 
of the use of the historical regional data  that had been used to calculate the crop -specific 
subsidy payments under the SPS.  [The USDOC]'s  analysis is summarized:  
In summary, the annual grant amount provided to olive f armers under BPS 
is based on the annual grant amount provided to olive farmers under SPS. 
The grant amount provided to olive farmers under SPS is based on the 
average grant amount olive farmers received in 1999 through 2002 under 
the [COMOF programme]. The  grant amount provided in 1999 through 
2002 to eligible farmers, which included olive farmers, was based on the 
type of crop grown and the production value created from the 
crop. Therefore, the annual grant amount provided under BPS {is} based 
on annual gr ant amounts that were crop -specific, thus the grant amounts 
received by olive growers under BPS in 2016 are directly related to the 
grant amount only olive growers received under the 
[COMOF  programme].202 
7.91.   In the first of the above -quoted paragraphs, the USD OC recalled its findings with respect to 
the role played by the  "regional rate " in the calculation of BPS payments. The USDOC explained that 
the "regional rate" was established using data collected  under  the SPS programme , and that it was 
used to determine  BPS payments . The USDOC similarly explained that BPS payments varied by 
region  because they were the " result  of the use of historical  regional  data … used to calculate  the 
crop-specific  subsidy  payments  under  the SPS". The USDOC then quoted a summary of its original 
"analysis", from which it can be inferred that the USDOC was of the view that SPS payments were 
"crop -specific" because they were "based on the average amount olive farmers received … under 
the [COMOF programm e]". Thus, we understand the USDOC to have found in this passage that 
BPS payments were determined through the application of a "regional rate" based on data used to 
calculate SPS payments, which derived from and was used to determine the crop -specific pay ments 
made under the COMOF programme. The USDOC in this way established a connection between the 
"regional rate" (which it had found was used to determine BPS payments)  and the crop -specific 
payments made under the COMOF programme, thereby supporting its u ltimate conclusion that the 
BPS rules governing the calculation of payment amounts continued the inherent de jure specificity 
of the COMOF programme. Accordingly, while we recognize that the USDOC's  determination of 
de jure specificity was also based on ot her considerations203, we find that the USDOC's  erroneous 
factual findings with respect to the role of the "regional rate" in the calculation of BPS payments 
were also relied upon, and to this extent, detract from the USDOC's  determination of de jure 
specif icity. 
7.92.   Finally, a s already noted, in responding to the European  Union's  submissions the 
United  States  observes that in cases in which the "regional rate" was applied, "it would effect no 
reduction, and guarantees, in the assistance allocated to olive growers" because it was set at a value 
 
202 Remand Redetermination, ( Exhibit  EU-80), pp. 8-9. (fns omitted)  
203 As we discussed above, the USDOC 's de jure specificity determination is best understood as a finding 
that the BPS subsidies were de jure specific to olive growers because "access to, and the amount of, benefits 
provided to olive growers  under the BPS, as a matter of law, relied for reference on the provision of benefits 
under the SPS and, in turn, access to and the amount of benefits provided to olive growers  under the SPS was 
determined by reference to the benefits provided under the [COMOF programme] ." (Remand Redetermination, 
(Exhibit  EU-80), p. 15 (emphasis added)).  See para . 7.58 above.  WT/DS 577/R  
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  of "1"  for permanent crops such as olives .204 However, the European  Union's  criticism of the 
USDOC's  determination does not c oncern any USDOC consideration of the potential effect of the 
application of the "regional rate" on BPS payments to olive farmers holding entitlements across 
different regions. Rather, the European  Union's  complaint concerns the USDOC's  findings with 
respe ct to the prescribed  role of the "regional rate"  in the calculation of a farmer 's BPS payments , 
which we have found were not supported by record evidence. The United  States has not explained 
how the potential effect of the application  of the "regional rate " to olive farmers holding entitlements 
across different regions shows that the USDOC 's reliance on erroneous factual findings with respect 
to the prescribed  role of the "regional rate"  in the calculation of a farmer 's BPS payments  supports 
its determinati on of de jure specificity . 
7.93.   In conclusion, therefore, we find that the USDOC erred, as a matter of fact, when it found 
that the "regional rate" under the BPS  programme , as implemented by Spain, was to be "used to 
determine the value of each hectare of farmland 's 'basic payment entitlement'"  and that " each basic 
payment entitlement amount will be weighted by the regional reference value to which it 
corresponds ".205 Furthermore, we find that the USDOC relied upon these erroneous factual findings 
to support  its determination of de jure specificity.  
7.2.2.3.6   The USDOC's  alleged  finding  concerning  differences  in BPS payments  based  on 
"the amount  of grant  money  the different  regions  received  under  the SPS" 
7.94.   Another alleged error of factual appreciation the European  Union identifies in the 
USDOC's  determination of de jure specificity concerns the following passage  about the implications 
of the BPS subsidy calculation rules for two farms of the same size locate d in different regions of 
Spain  from the USDOC's  preliminary issues and decision memorandum:  
The application to receive grants under the [BPS  programme ] and [ the GP programme ] 
includes the total entitlement value for the farm and this determines the amount  of 
assistance the farmer will receive under these two BPS subprograms. To calculate a 
farm's total entitlement value, the number of hectares is multiplied by that 
location's  regional value. In summary, two farms  of the same  size can have two different  
total entitlement  values  if there  is a historical  difference  in the amount  of grant  money  
the different  regions  previously  received  under  SPS.206 
7.95.   The European  Union argues that the emphasized statement is factually incorrect because 
payments under  the SPS  programme  were granted to individual farmers, not regions, and because 
there was no such notion as "SPS regions" under that programme.207 Moreover, according to the 
European  Union , differences in BPS payments made to farmers operating in different BPS regions 
resulted, "in the first place ", from the application of the "weighting coefficient ", which was itself 
determined based on the contribution of the productive orientation of a region to the Spanish 
national agricultural income , and not any differences in payments made to "SPS regions ".208 The 
European  Union claims that these alleged errors of appreciation demonstrate that the 
USDOC's  determination was not reasonably and adequately explained, and that it was grounded on 
an errone ous factual basis and, therefore, inconsistent with Articles  2.1, 2.1(a),  and 2.4 of the 
SCM Agreement.209 
7.96.   The United  States argues that the European  Union's  assertion regarding payments under the 
SPS programme  being granted to farmers and not regions does not contradict the USDOC's  findings. 
According to the United  States, the European  Union's  argument fails to recogni ze that the differing 
payments received by farmers under the SPS  programme  resulted from the payments available 
under the predecessor program mes, and that the differing payments to farmers under the 
SPS programme  could lead to different BPS entitlement values for farms in different regions, even 
if the regions themselves were not designated as separate regions until the BPS and 
 
204 United  States'  first written submission, para. 96. 
205 FIDM, (Exhibit  EU-2), p.  34. 
206 PIDM, (Exhibit  EU-1), p.  21. (emphasis  added; fns omitted)  
207 European  Union's  first written submission, para. 309; opening statement at the first meeting of the 
Panel , fn 35 and paras.  67-68; and second written submission, para. 22. 
208 European  Union's  first written submission, para. 310 (referring to Order AAA/544/2015, 
(Exhibit  EU-21)). 
209 European  Union's  first written submission, para. 329; opening statement at the first meeting of the 
Panel , para. 76. WT/DS577/R  
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  GP programmes .210 Furthermore, according to the United  States, the European  Union does not 
explain how the fact that the "weighting coefficient" represents the contribution of  the productive 
orientation of a region to the national agricultural income  in Spain undermines th e USDOC's  findings. 
The United  States argues that such consideration is irrelevant for a de jure specificity analysis under 
Article  2 of the SCM  Agreement.211 
7.97.   We agree with the European  Union that the record evidence212 shows that payments under 
the SPS  programme  were granted to farmers, and not regions, and that Spain did not implement 
the SPS  programme  on a regional basis.  Thus, the USDOC's  reference to " grant money  the different  
regions  previously  received  under  SPS", would be factually incorrect if it were intended to mean that 
SPS payments were made to regions or that the SPS  programme  was implemented on a regional 
basis. In this respect, we note that the USDOC's  discussion of the calculation of SPS payments, 
which immediately followed the section  of the preliminary issues and decision memorandum 
containing the above -quoted statement, identifies farmers , not regions, as the recipients of 
SPS payments. For example, when discussing the operation of one of the relevant rules governing 
the calculation of pa yments under the SPS  programme , the USDOC states:  
Once the value per hectare was determined using this calculation, a farmer  would apply  
for an amount of aid equal to the number of hectares multiplied by the value of each 
hectare . … The average of four yea rs of this total  payment is the referenced amount 
used as the basis for the calculated amount under  the SPS annual  grant -to-farmer  
program . The individual, calculated BPS annual grant -to-farmer amount  derives from 
the amount of SPS grants  were [sic] provided  to each farmer  in 2013.213 
7.98.   We note, moreover, that the USDOC modified the contested statement in the final decision 
and issues memorandum, when it replaced the reference to " grant  money  the different regions 
previously received under the SPS" with "assistance  provided  in the different regions previously 
received under the SPS":  
Therefore, two farms of the same size can have two different total entitlement values if 
there is an  historical difference in the amount of assistance  provided  in the different  
regions  previously received under SPS.214 
7.99.   In our view, this statement does not suggest that the USDOC considered SPS payments were 
made to regions. Furthermore, the USDOC's  discussion in the final issues and decision memorandum 
of how payments wer e calculated under the SPS  programme  confirms that it understood that 
SPS payments were made to farmers, and nothing in that discussion indicates that the USDOC 
considered the SPS  programme  to be implemented by Spain on a regional basis. For instance, the 
USDOC observed that:  
As the EC points out, when the SPS program was implemented in Spain, the aid provided 
to farmers  was converted into "entitlements," rights to receive payments, that were 
linked to land area and completely decoupled from production. Tha t is, under SPS, the 
amount of the payment is dependent on the annual activation of the entitlement, and 
is not dependent on the type or volume of crop produced. Crucially, however, the 
amount of each farmer 's payment  was calculated as a percentage of the average annual 
grant payments previously provided over a reference period.215 
7.100.   Finally, we note that in the Remand Redetermination the USDOC quoted and relied upon the 
contested statement from the preliminary issues and decision memorandum to justify its fin ding that 
 
210 United  States'  first written submissio n, para. 97 (referring to the USDOC 's statement in the FIDM, 
(Exhibit  EU-2), pp. 35-36, that "two farms of the same size can have two different total entitlement values if 
there is an historical difference in the amount of assistance provided in the differ ent regions previously 
received under SPS" ). 
211 United  States'  first written submission, para. 98. 
212 This evidence includes not only the rules of the SPS  programme  itself, but also a submission of the 
GOS in which it was explained that "[i]n Spain, the decision taken by the agricultural authorities was to apply 
the SPS as a historical model (and not a regional one)". (Submission by the GOS in relation to the preliminary 
determination , (Exhibit  EU-14), p. 12). 
213 PIDM, ( Exhibit  EU-1), pp. 22-23. (emphasis  added)  
214 FIDM, ( Exhibit  EU-2), pp. 35-36. (emphasis  added)  
215 FIDM, ( Exhibit  EU-2), p. 33. (emphasis  added; fns omitted)  WT/DS 577/R  
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  the BPS subsidies were not uniformly available across the agricultural sector, and therefore, could 
not be "non -specific" within the meaning of the US domestic law.216 However, we do not understand 
the USDOC's  reliance upon the contested statement  in this context to reflect a change in the 
USDOC's  view about who were the recipients of SPS payments. Indeed, elsewhere in the 
Remand  Redetermination the USDOC's  discussions of the relevant rules explicitly recognize that 
SPS payments were made to farmer s.217 
7.101.   In conclusion, we find that while on its own the contested statement from the 
USDOC's  preliminary issues and decision memorandum could be interpreted to mean that the 
USDOC (erroneously)  found that SPS payments were made to regions, when the same stat ement is 
considered in the light of the USDOC's  surrounding analysis, the modification made to the relevant 
statement in the final issues and decision memorandum, as well as the discussion of the 
SPS programme  in the Remand Redetermination, we are not conv inced that it should be understood 
in that way. Rather, in the light of the totality of the USDOC's  discussion of the rules governing the 
calculation of SPS  payments, we find that the USDOC understood that SPS payments were made to 
farmers and that Spain d id not implement the SPS  programme  on a regional basis, unlike the 
BPS programme . Having reached this conclusion, we do not believe it is necessary to address the 
European  Union's  additional argument in support of its claims that differences in SPS payment s 
resulted, "in the first instance", from application of the "weighting coefficient" and not different 
payments made to SPS regions, because we have ultimately found that the USDOC did not make 
the latter finding.  
7.2.2.3.7   The USDOC's  findings  with respect  to the SPS programme  
7.102.   Similarly to  its complaint against the USDOC 's determination of de jure specificity with 
respect to the BPS and GP  programmes , the European  Union  maintains that the USDOC 's finding of 
the existence of a direct correlation between  the amou nts of assistance provided to olive growers 
under the SPS  programme  and the COMOF programme is erroneous , and ignores certain relevant 
aspects of the record evidence demonstrating that no such direct correlation exists. According to the 
European  Union , the USDOC allegedly overlooked the following  features of the relevant subsidy 
regime : (i) the fact that subsidy amounts were, as a matter of law, based on the "global" amount of 
support provided under multiple prior programmes, not only on assistance under the 
COMOF  programme ; (ii) the possibility of obtain ing payment entitlements by transfer or by 
inheritance; ( iii) the fact that a previously active olive farmer was entitled to receive assistance 
regardless of whether that farmer continued to produce olives; and (iv ) the fact that support was 
available to new farmers via the national reserve.218 The European  Union  submits that the se alleged  
errors of appreciati on demonstrate that the USDOC 's determination of de jure specificity was not 
reasonably and adequately explained, was grounded on an erroneous factual basis , and, therefore, 
is inconsistent with Articles  2.1, 2.1(a ), and 2.4 of the SCM  Agreement . 
7.103.   The United  States argues that the European  Union's  arguments do not undermine the 
USDOC's  conclusion that the SPS subsidies to olive growers were de jure specific in light of the 
reference to the COMOF programme.219 The United  States argues that the fact that entitlements 
could have been transferred  does not sever the reliance  on the COM OF programme that Spain 
elected to incorporate into the SPS  programme .220 Furthermore, according to the United  States, 
despite the fact that other factors contributed to the calculation of the amount of support available 
under the SPS  programme , nevertheles s the amount of support was related to the support received 
 
216 Remand Redetermination, ( Exhibit  EU-80), p. 18 and fn 62, where the USDOC explains : "[a]s [the 
USDOC]  concluded in the investigation, the result of the application of the legislatively preserved methodology 
regarding access to, and the distribution of, benefits was that 'two farms of the same size can have two 
different total en titlement values if there is a historical difference in the amount of grant money the different 
regions previously received under SPS.'"  
217 See, e.g. Remand Redetermination, ( Exhibit  EU-80), p. 16, where the USDOC states that "the SPS 
grant amounts were bas ed on the amount of grants provided under the [COMOF programme]  that were 
available only to olive growers, thereby entrenching the crop -specific nature of the subsidy under the 
[COMOF  programme]  into the criteria for determining the assistance that a farmer  would  be eligible  to receive  
under  the SPS". (emphasis  added)  
218 European  Union's  first written submission, paras.  79-80 and 244; opening statement at the first 
meeting of the Panel , paras.  28 and 37; 10  June 2020 response to Panel question No.  10, para. 55; 
12 November  2020 response to Panel question No. 8, para. 43; and 25 February  2021 response s to Panel 
question No.  3, paras.  9-11, and No.  7, para. 65. 
219 United  States'  first written submission, para. 71. 
220 United  States'  first written submission, para. 72; second written submission, para. 25. WT/DS577/R  
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  under the de jure specific COMOF programme.221 Finally, the United  States also argues that the rules 
for calculating the amount of support available from the national reserve were not on the 
USDOC's  record, and therefore were not among the "information and arguments" within the meaning 
of Article  12.2 of the SCM  Agreement upon which the USDOC could base its determination.222 
7.104.   As noted  in paragraph 7.58 of this Report , the USDOC determined that the SPS subsidies 
were de jure specific to olive growers because it found those subsidies to be legally tied to historic 
olive production under the COMOF programme . In the preliminary issues and decision memorandum, 
the USDOC described the relationship between the COMOF and the SPS programmes in the following 
manner:  
To determine the SPS entitlement per hectare value, the calculation relied on a 
"referenced amount." Th is referenced amount was the average of the total payment 
amounts under the annual grant -to-farmer program in place from 1999 -2002, which for 
olive growers was the [COMOF programme].223 
7.105.   Similarly, in the final issues and decision memorandum, the USDOC expla ined: 
As the EC points out, when the SPS program was implemented in Spain, the aid provided 
to farmers was converted into "entitlements," rights to receive payments, that were 
linked to land area and completely decoupled from production. That is, under SPS , the 
amount of the payment is dependent on the annual activation of the entitlement, and 
is not dependent on the type or volume of crop produced. Crucially, however, the 
amount of each farmer's payment was calculated as a percentage of the average annual 
grant payments previously provided over a reference period. In the case of olives and 
olive oil, this reference period was from 1999 through 2002, when the 
[COMOF  programme] was in operation. Because the [COMOF programme] provided 
benefits on a de jure specific basis, the benefits provided under the SPS retained the 
de jure specificity inherent in the [COMOF programme].224 
7.106.   Finally, in the Remand Redetermination, the USDOC explained the relationship between the 
SPS and COMOF programmes in, inter alia, the fol lowing terms:  
[T]he SPS benefits were based on the value of each hectare in a farm, which was 
determined using the average amount of grants provided to that area from 1999 
through 2002 ( i.e., when the [COMOF programme]  was in operation). … [T]he SPS grant 
amounts were based on the amount of grants provided under the [COMOF programme]  
that were available only to olive growers, thereby entrenching the crop -specific nature 
of the subsidy under the [COMOF programme]  into th e criteria for determining the 
assistance that a farmer would be eligible to receive under the SPS. In this manner, the 
value of the grants provided under the [COMOF programme]  (the access to which was 
expressly limited to the olive sector ) was preserved i n calculating the grants paid under 
the SPS. Thus, under the SPS, access to a subsidy based on the [COMOF programme]  
subsidies was expressly limited to olive growers.225 
7.107.   We recall that the rules governing the allocation and valuation of entitlements under t he 
SPS programme  did not prescribe that the value of all such entitlements for olive growers were to 
be determined with reference to the COMOF programme.226 Entitlements under the SPS  programme  
could be obtained in one of three ways:  (a) as a result of rece iving assistance under at least one of 
several prior support schemes  (which included the COMOF programme)227; (b) by transfer or 
 
221 United  States'  first written submission, para. 71. 
222 United  States'  11 March  2021 comments on the European  Union's  25 February  2021 response to 
Panel question No.  7, para.  37. 
223 PIDM, (Exhibit  EU-1), p.  22. 
224 FIDM, (Exhibit  EU-2), p.  33. (fns  omitted)  
225 Remand Redetermination, ( Exhibit  EU-80), p. 16. (fn omitted)  
226 See paras.  7.70-7.72 above.  
227 Regulation 1782/2003, ( Exhibit  EU-24), Article  33. See also European  Union's  first written 
submission, para. 70(b).  WT/DS 577/R  
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  inheritance228; or (c) from the national reserve.229 Thus, an olive farmer's  entitlements do not appear 
to have been limited, as a matter  of law, to those obtained through the operation of the 
COMOF  programme, as it was legally possible for an olive farmer to obtain SPS entitlements by other 
means – namely, via transfer from a farmer of other products, or potentially from the nationa l 
reserve.230 
7.108.   The European  Union argues that the USDOC's  assessment was "simplistic" because, 
inter alia, it ignored that the amount of support available to a farmer under the SPS  programme  was 
based on the global  amount of support granted during the reference period, and not exclusively on 
the COMOF programme.231 In this regard, the European  Union asserts that i f during the reference 
period a farmer was growing several crops (and not only olives), the farmer 's entitled amount of 
assistance under the SP S programme  would not be based exclusively on assistance received under 
the COMOF programme , but would also take into account past assistance receive d under other 
crop-specific programmes.232 In the United  States'  view, this possibility does not affect that , in the 
case that a farmer was growing olives during the reference period, the amount of SPS support w ould 
be related to the support received under the de jure specific COMOF programme.233 
7.109.   We note that there is no discussion in the USDOC's  determinations of the relevance to its 
findings of the possibility that an olive farmer's  SPS payments may have been based on assistance 
received for non -olive growing activities under programmes other than the COMOF programme. 
However, we do not u nderstand the USDOC to have ignored this possibility. Indeed, the USDOC 
appears to have recognized that SPS entitlements of farmers producing different crops would be 
based on non -COMOF programmes.234 Thus, we do not find the absence of any discussion of th is 
feature of the SPS  programme  in the USDOC's  determination to undermine the USDOC's  findings of 
de jure specificity because, ultimately, as already noted, the USDOC's  findings were driven by the 
view that the availability of COMOF programme -based payment s were, as a matter of law, limited 
to olive growers. The fact that olive growers may have received SPS payments for non-olive growing  
activities under different programmes does not undermine the USDOC's  position.  
7.110.   Turning to the possibility of transfer, we  recall that w hen an SPS entitlement was obtained 
by transfer, the original source of that entitlement could have been a support programme other than 
the COMOF  programme , as in addition to olives, the previously existing support schemes falling 
within the scope of the SPS  programme  included programmes providing assistance for arable crops, 
potato starch, grain legumes, rice, seeds, beef and veal, milk and milk products , sheep meat and 
goatmeat, dried fodder, cotton, tobacco, hops, sugar beet, cane  and chicory used for the production 
of sugar or inulin syrup, and bananas .235 This suggests that , as a matter  of law, an olive 
grower 's SPS entitlements could have been  obtained via transfer  from, for example,  a cotton farmer , 
and therefore would have deri ved from non -COMOF -programme -based assistance . Conversely, the 
value of SPS entitlements of a farmer that did not grow olives (for example, a grower of citrus 
fruits) could have been derived from COMOF programme -based assistance and transferred from an 
olive grower. In our view, these considerations suggest that the SPS  programme  did not legally tie 
 
228 Regulation 1782/2003, (Exhibit  EU-24), Article  46; Regulation 73/2009, (Exhibit  EU-23), Article  43. 
According to the European  Union , since Spain did not implement the SPS programme  on a regional basis 
(unlike the BPS programme , as explained below), a farm er could sell, buy , or rent SPS entitlements and 
activate them in any eligible hectare in Spain. (European  Union's  first written submission, para. 83; 
25 February  2021 response to Panel question No. 7, para. 64). 
229 Regulation 1782/2003, (Exhibit  EU-24), Ar ticle 42.3; Regulation 73/2009, (Exhibit  EU-23), 
Article  41.2. See also European  Union's  first written submission, paras.  70(b)  and 83; and 25 February  2021 
response to Panel question No. 7, para. 63. 
230 The extent to which the USDOC possessed relevant info rmation about the rules governing the precise 
calculation of entitlement values potentially available to olive growers from the Spanish national reserve is 
discussed in more detail below. (See paras.  7.112 -7.114  below ). 
231 European  Union's  first written submission, para. 244. 
232 European  Union's  first written submission, para. 80 (referring to Submission by the GOS in relation 
to the preliminary  determi nation, ( Exhibit  EU-14), p p. 12-13; and GOS's response to supplemental 
questionnaire of 10  January  2017, (Exhibit  EU-15), p. 18). 
233 United  States'  first written submission, para. 71. 
234 See e.g. PIDM, (Exhibit  EU-1), p. 22 and fn 116, where the USDOC explai ns that "[the] referenced 
amount was the average of the total payment amounts under the annual grant -to-farmer program in place 
from 1999 -2002, which for olive growers was the [COMOF] program", and that "[o]ther products [than olives] 
used an average of payments received during 2000 -2002".  
235 Regulation 1782/2003 , (Exhibit  EU-24), Article  37 and Annex  VI. See also European  Union's  first 
written submission, para. 79. WT/DS577/R  
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  the value of SPS entitlements for olive growers to the assistance received under the 
COMOF  programme. While COMOF programme -based assistance may have been, as a matter  of 
fact, the basis for calculating the value of an olive grower's  SPS entitlements, the SPS  programme  
did not make this a legal requirement. Rather, when considered in the light of the relevant SPS rules 
concerning the possibility of transferring entitlements, the SPS  programme  appears to leave open 
the possibility that the value of an olive grower's  SPS entitlements could be a function of 
non-COMOF -programme -based historical assistance. Likewise, the SPS  programme  also seems to 
envisage that COMOF programme -based assistance could have been the basis of the 
SPS entitlements of any farmer (not only olive gr owers)  if obtained via transfer. In our view, these 
considerations suggest that the SPS  programme  did not legally  limit the class of farmers that may 
benefit from COMOF programme -based entitlements to olive growers. However, this aspect of the 
rules govern ing the allocation and calculation of SPS entitlements was not discussed or examined in 
the USDOC's  determination of de jure specificity.  
7.111.   The United  States argues that t he fact that entitlements could have been bought, rented, or 
inherited does not sever t he reliance on the COMOF programme that Spain  elected to incorporate 
into the SPS programme.236 As already noted, however, the fact that COMOF programme -based 
SPS entitlements could be transferred under the SPS  programme  to farmers that did not grow olives 
suggests that the access to, and the amount of SPS payments derived from COMOF -based assistance 
was not legally  limited to olive growers. Moreover, the fact that olive farmers could have obtain ed 
entitlements  under the SPS  programme  derived from non -COMOF -programme -based assistance by 
way of transfer, suggests that SPS payments to the same olive farmers could be, as a matter of law, 
derived from programmes other than the COMOF programme.  
7.112.   We furthermore recall that to qualify for SPS assistance, a farmer wa s not required to 
produce any agricultural product. As already explained, this  indicates that, as a matter  of law, it was 
entirely possible for a "farmer" to benefit from COMOF programme -based entitlements derived from 
prior olive production , even if it no longer produced olives during the period of operation of the 
SPS programme  (either because, for example, it switched to growing a different crop or decided to 
pursue other qualifying farming activities). This is yet another feature of the relevant rules  that 
suggests that the SPS  programme  did not, as a matter  of law, limit the potential to benefit from 
COMOF programme -based entitlements to olive growers. While the USDOC recognized that the 
amount of support under the SPS  programme  is not dependent on th e type or volume of production, 
the USDOC did not explain why this consideration would be irrelevant or would not undermine its 
de jure specificity findings.  
7.113.   Finally, we note that it was also possible for new farmers (including new olive farmers)  to 
obtain  SPS entitlements from the national reserve. The establishment of the national reserve and 
its intended purpose was set out in Article  42 of Regulation 1782/2003 , which provided inter alia as 
follows:  
1. Member States shall, after any possible reduction un der Article  41(2), proceed to a 
linear percentage reduction of the  reference amounts in order to constitute a national 
reserve. This reduction shall not be higher than 3 %.  
… 
3. Member States may use the national reserve to grant, in priority, reference 
amounts to farmers who commence their agricultural activity after 31  December  2002, 
or in 2002 but without receiving any direct payment in that year, according to objective 
criteria and in such a way as to ensure equal treatment between farmers and to avoid 
market and competition distortions.237 
7.114.   We understand from these provisions that new farmers (including new olive farmers)  could, 
as a matter of law, receive payments from the national reserve, which was to be constituted with 
the proceeds of a 3% reduction in SPS payments that would otherwise be made to farmers holding 
entitlements. This information was before the USDOC. However, as the United  States points out, the 
rules governing the precise calculation of payments from the Spanish national reserve for new  
 
236 United  States'  first written submission, para. 72. 
237 Regulation 1782/2003, ( Exhibit EU-24), Article  42. WT/DS 577/R  
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  farmers (including new olive farmers)  was not before the USDOC.238 This means that the information 
necessary to determine the extent to which such payments to new olive farmers may or may not 
have been tied to payments received by olive farmers during the COMOF programme reference 
period was not in the USDOC's  possession.  
7.115.    Thus, with the exception that olive growers may have held SPS entitlements based on the 
global amount of support (and not only COMOF programme -related assistance)  and the possibility 
of obtaining entitlements from the national reserve, we find that the above -examined features of 
the rules governing the allocation and calculation of SPS payments for farmers with SPS entitlements 
obtained via transfer, and farmers holding COMOF programme -based entitlements no longer 
producing olives, were relevant to the USDOC's  determination of de jure specificity. The fact that it 
was legally possible to transfer  COMOF  programme -based  entitlements  to non-olive farmers  under  
the SPS programme  suggests that the SPS  programme  did not explicitly limit access to the 
COMOF  programme -based payments to olive growers. Other farmers could have obtained and 
benefited from such entitlements by transfer in the same way as olive growers holding the same 
entitlements. Moreover, because crop production was not a precondition for a farmer to receive 
SPS payments, it was also legally possible for a farmer that obtained assistance under the 
COMOF  programme to continue to receive SPS payments based on that assist ance even if such 
farmer was no longer  producing  olives  in the SPS period.  
7.116.   In conclusion, we find that the USDOC did not properly examine and account for the 
above -mentioned features of the rules governing the allocation and valuation of SPS entitlements i n 
its determination of de jure specificity.  
7.2.2.3.8   The USDOC's  findings  with respect  to the COMOF  programme  
7.117.   The European  Union  argues that the USDOC's  analysis and statements with respect to the 
COMOF programme  could not objectively serve as the "foundation" of the USDOC's  de jure specificity 
findings with respect to the SPS and BPS  programmes , because the USDOC never actually 
determined that the COMOF programme was de jure specific, but rather only stated that it "would 
find" the COMOF programme to be de jure specific.239 The European  Union maintains that the 
USDOC's  reliance on this "would -be-finding " with respect to the COMOF programme reveals that the 
USDOC's  de jure specificity findings in relation to the SPS  and BPS  programmes  were not based on 
a reasoned and adequate explanation and, to this extent, were inconsistent with Articles  2.1, 2.1(a),  
and 2.4 of the SCM  Agreement.240 In addition, the European  Union  argues that the 
USDOC 's explanation of the calculati on of assistance under the COMOF  programme was factually 
incorrect, thereby rendering the USDOC's  findings inconsistent with Article  2.4 of the 
SCM Agreement.241 
7.118.   The United  States does not deny that the USDOC did not make a separate finding of 
specificity in relation to the COMOF programme under the US law. However, according to the 
United  States, a separate de jure specificity determination with respect to the COMOF p rogramme 
would have been meaningless and unnecessary, because  (i) Article  2.1(a ) of the SCM  Agreement  
does not require an  investigating authority to make separate specificity findings for each legal 
instrument that falls within the scope of the " the legisl ation" at issue, but only requires such 
determination with respect to the subsidy programme as defined in Article  1.1 of the 
SCM Agreement ; and (ii ) the COMOF programme was not the programme that conferred subsidies 
during the period of investigation .242 
 
238 United  States'  11 March  2021 comments on the European  Union's  25 February  2021 response to 
Panel question No.  7, para. 37 (referring to European  Union's  25 February  2021 response to Panel question 
No. 7, para. 65). 
239 European  Union's first written submission, paras.  282-289; opening statement at the first meeting of 
the Panel , para. 62. 
240 European  Union's  first written submission, para. 329; 10 June 2020 response to Panel question 
No. 4, para. 34; and opening statement at the first meeting of the Panel , para. 76. 
241 European  Union's  first written submission, paras.  315 and 329 . 
242 United  States'  first written submission, para. 90; 10  June 2020 response to Panel question No.  5, 
para. 21. WT/DS577/R  
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  7.119.   We note that in the final issues and decision memorandum, the USDOC began its response 
to the interested parties'  comments with respect to its preliminary determination of de jure 
specificity by highlighting the relevance of the COMOF programme subsidies to its overall findings:  
We continue to find, for purposes of this final determination, that assistance provided 
under the CAP Pillar I programs Basic Payment Scheme (BPS ) and [the GP programme ] 
is de jure specific and, therefore, countervailable. As we expla ined in the Preliminary 
Determination, our finding of de jure specificity is based on the manner in which Spain 
implemented the Pillar I programs with reference to the operations of its 
two predecessor programs, the Single Payment Scheme and the [COMOF programme] , 
and the manner in which the amount of assistance was determined under these 
two programs. The earliest  of these  programs,  the [COMOF  programme ], was in place 
from 1999 through  2003,  and provided  production  aid in the form of annual  grants  to 
farmers  on the basis of type of crop and the volume  of production.  Both olive oil and 
table olives  were specifically  identified  as products  eligible  to receive  production  aid 
under  this program,  and the payments  provided  during  this period  were based  on 
whether  the olives  were used to produce  olive oil or table olives.  Specifically,  the 
payment  for hectares  that grew olives  for olive oil production  used the equation  
"132.25/100kg " to calculate  the value  of the payment  per hectare;  the payment  for 
hectares  that grew olives  to produce  table olives  used a different  calculation,  in which  
the ratio of 100 kg of processed  table olives  was equal  to 11.5 kg of olive oil eligible  for 
production  aid. Once the value  per hectare  was determined  using  this calculation,  a 
farmer  would  apply  for aid in the amount  of the number  of hectares  multiplied  by the 
value  of each hectare.243 
7.120.   The USDOC then went on to make the statements that are the focus of the 
European  Union's  submissions:  
We recognize that the [COMOF programme]  is no longer in operation and ceased 
providing benefits to olive growers in 2003, and we are not rendering  a decision  
regarding whether the assistance provided under this program was specific under 
section  771(5A ) of the Act. However, because the amount o f assistance provided to 
olive farmers and the methodology for determining it under this program forms the 
foundation for determining the amount of assistance provided to olive farmers under 
the successor programs SPS and CAP Pillar I BPS and [the GP progr amme ], it is 
necessary  to evaluate  the specificity  of this program  separately . In doing so, we 
consider that, because the [COMOF programme]  provided annual payments only to 
producers of oilseed crops, including olives, we would  find this program  to be de jure 
specific , as explained in further detail below .244 
7.121.   As the European  Union asserts, the USDOC explained in this paragraph  that it would not be 
making a finding of specificity in relation to the COMOF programme under domestic law. However, 
the same passage also reveals that the USDOC considered that it "would find" the 
COMOF  programme de jure specific because it "provided annual payments only to producers of 
oilseed crops, including olives". The USDOC then proceeds to explain that:  
[T]he amount of ea ch farmer 's payment [under the SPS  programme ] was calculated as 
a percentage of the average annual grant payments previously provided over a 
reference period.  In the case of olives and olive oil, this reference period was from 1999 
through 2002, when the [COMOF programme]  was in operation. Because the 
[COMOF  programme]  provided benefits on a de jure specific basis, the benefits provided 
under the SPS retained the de jure specificity inherent in the [COMOF  programme] .245 
7.122.   Thus, after stating that it "would fin d" the COMOF programme de jure specific under the 
US law because of the crop -specific focus of its payments, the USDOC expressly stated that the 
COMOF programme "provided benefits on a de jure specific basis". The USDOC repeated this view 
 
243 FIDM, ( Exhibit  EU-2), pp. 32-33. (emphasis  added; fns omitted)  
244 FIDM, ( Exhibit  EU-2), p. 33. (emphasis  added)  
245 FIDM, (Exhibit  EU-2), p.  33. (fn omitted)  WT/DS 577/R  
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  in multiple parts  of the Remand Redetermination, including in the following passages where it 
explained:  
[The COMOF programme] provided benefits on a de jure specific basis because access 
to the subsidy was expressly limited to olive growers. The benefits provided under th is 
program were calculated with a rate of Euros per kilogram of a farmer 's production of 
olives for oil and olives for table olive production (different rates were applied to olives 
for oil and olives for table olive production). This value is unique to, a nd only accessed 
by, farms that grow olives.  
…  
[T]he SPS grant amounts were based on the amount of grants provided under the 
[COMOF programme]  that were available only to olive growers, thereby entrenching the 
crop-specific nature of the subsidy under the  [COMOF programme]  into the criteria for 
determining the assistance that a farmer would be eligible to receive under the SPS.  
In this manner, the value of the grants provided under the [COMOF programme]  (the 
access to which was expressly limited to the olive sector ) was preserved in calculating 
the grants paid under the SPS .246 
7.123.   We note that the European  Union  does not assert that interested parties had argued in the 
underlying investigation that the histo rical COMOF programme subsidies were not de jure specific 
within the meaning of Article  2.1(a ) of the SCM  Agreement . Neither does the European  Union make 
that submission in these proceedings. Thus, w e understand the European  Union's  complaint to focus 
on the absence of a formal specificity finding under the US law, and the implications of this for the 
consistency of the USDOC 's determination with the United  States'  obligations under Articles  2.1, 
2.1(a),  and 2.4 of the SCM  Agreement.  
7.124.   In our view, the above excerpts  demonstrate that the USDOC did, in fact, evaluate and 
express a position with respect to the specificity of the COMOF programme. While the USDOC did 
not render a formal  decision  under domestic law , we consider that the USDOC nevertheless 
establish ed to its satisfaction the existence of all of the factual  elements  that it believed  would have 
enabl ed it to find the COMOF programme subsidies de jure specific for the purpose of the 
USDOC 's subsequent establishment of the alleged "operational link" between the COMOF, SPS, and 
BPS/GP  programmes . In other words, the USDOC  considered that it had  made sufficient 
factual  findings  with respect to the COMOF programme to satisfy itself that the subsidies available 
under the COMOF programme  would be de jure specific under its domestic legislation, had it been 
required to make such a finding as a matter  of domestic  law. 
7.125.   Finally, we turn to the European  Union's  submission regarding the factual accuracy of the 
USDOC 's findings concerning the ca lculation of assistance under the COMOF  programme .247 
According to the European  Union , the USDOC 's explanation that "[o]nce the value per hectare was 
determined [under the COMOF programme ] a farmer would apply for an aid equal to the number of 
hectares mult iplied by the value of each hectare"248 is factually erroneous. The European  Union  
explains that the support under the COMOF programme was provided in proportion to production 
quantity, and not in terms of an amount or value per hectare.249 The United  States has not 
specifically responded to this criticism of the USDOC's  COMOF programme explanations.  
7.126.   We agree with the European  Union  that the USDOC 's explanation of the calculation of the 
COMOF programme assistance is factually inaccurate . The relevant rule , which was on the record of 
the USDOC's  investigation,  prescribes that the amount of COMOF programme assistance was to be 
 
246 Remand Redetermination, (Exhibit  EU-80), pp.  15-16. 
247 European  Union's  first written submission, para. 315. 
248 European  Union's  first written submission, para. 315 (quoting the language from PIDM, 
(Exhibit  EU-1), p. 22, and noting that FIDM, ( Exhibit  EU-2), contains similar language ). FIDM , (Exhibit  EU-2), 
with respect to COMOF provides that "[o]nce the value per hectare was determined using this calculation, a 
farmer would apply for aid in the amount of the number of hectares multiplied by the value of each hectare". 
(FIDM, ( Exhibit  EU-2), p. 33). 
249 European  Union's  first written submission, para. 315. WT/DS577/R  
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  calculated on the basis of production quantities .250 The relevant calculation did not establish a "value 
per hectare" , as stated in the USDOC's  final issues and decision memorandum.  
7.2.2.3.9   Conclusion regarding the USDOC 's finding s that the BPS and GP  programmes  
retained the inherent de jure  specificity of the subsidies provided under the 
COMOF  programme  
7.127.   In the light of the foregoi ng analysis, we conclude as follows:  
a. The European  Union has not demonstrated  that the USDOC acted inconsistently with 
Article  2.1(a)  of the SCM  Agreement because its determination of de jure specificity was 
dependent upon how certain alleged features of past subsidy programmes  no longer in 
force were relied upon and integrated into the BPS  programme .251 
b. The European  Union has not demonstrated that the USDOC's  determinations of de jure 
specificity with respect to the BPS, GP, and SPS  programmes were inconsistent with 
Articles  2.1, 2.1(a),  and 2.4 of the SCM  Agreement because, c ontrary to the 
European  Union's  assertion, the USDOC did not find the BPS, SPS, and GP  subsidies to 
be de jure specific to olive growers as a result of being coupled  or tied to olive 
production . Rather, the USDOC determined that the SPS, BPS, and GP subsidies were 
de jure specific to olive growers , because, according to the USDOC, the SPS, BPS, and 
GP subsidies ava ilable to olive growers were tied to historical  olive production during 
the COMOF programme reference period.252 
c. The European  Union has demonstrated  that the USDOC's  determination of de jure 
specificity was inconsistent with Articles  2.1, 2.1(a),  and 2.4 of the SCM  Agreement 
because:  
i. The USDOC did not properly examine and account for the rules governing the 
allocation and valuation of BPS entitlements with respect to new farmers, farmers 
holding entitlements transferred under the SPS  programme , and farmers no 
longer growing olives. To this extent, we find that the USDOC's  determination of 
de jure specificity was not based on a reasoned and adequate explanation  of why 
access to the BPS subsidie s was explicitly limited to olive growers, within the 
meaning of Articles  2.1 and 2.1(a), and was not clearly substantiated on the basis 
of positive evidence, as required by Article  2.4.253 
ii. The USDOC relied upon erroneous factual findings with respect to fu nction and 
role of the so -called "regional rate" to support its determination of de jure 
specificity. To this extent, we find that the USDOC's  determination of de jure 
specificity was not based on a reasoned and adequate explanation of why access 
to the BP S subsidies was explicitly limited to olive growers, within the meaning 
of Articles  2.1 and 2.1(a), and was not clearly substantiated on the basis of 
positive evidence, as required by Article  2.4.254 
iii. The USDOC did not properly examine and account for the ru les governing the 
allocation and valuation of SPS entitlements with respect to farmers with 
SPS entitlements obtained via transfer, and farmers holding 
COMOF  programme -based entitlements no longer producing olives. To this 
extent, we find that the USDOC's  determination of de jure specificity was not 
based on a reasoned and adequate explanation  of why access to the SPS subsidies 
was explicitly limited to olive growers, within the meaning of Articles  2.1 and 
 
250 Regulation 1638/98, ( Exhibit  EU-26), Article  5.1, provides that "[t]he aid shall be granted to olive 
growers on the basis of the quantity of olive oil they actually produce".  
251 See para. 7.37 above.  
252 See para. 7.52 above.  
253 See paras. 7.74-7.75 above.  
254 See para. 7.93 above.  WT/DS 577/R  
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  2.1(a), and was not clearly substantiated on the ba sis of positive evidence, as 
required by Article  2.4.255 
d. The European  Union has demonstrated  that the USDOC's  determination of de jure 
specificity was inconsistent with Article  2.4 of the SCM  Agreement  because the 
USDOC's  determinations of de jure specificity with respect to the SPS and  
BPS/GP  programmes was not clearly substantiated on the basis of positive evidence, to 
the extent that those determinations relied upon the explanation that "[o]nce the value 
per hectare was determined [under the COMOF programme ] a farmer would apply for 
an aid equal to the number of hectares multiplied by the value of each hectare"256, 
which was factually inaccurate .257 
e. The European  Union has  not demonstrate d that the USDOC's  determinations of de jure 
specificity with respect to the BPS, GP, and SPS  programmes were inconsistent with 
Articles  2.1, 2.1(a),  and 2.4 of the SCM  Agreement because:  
i. Contrary to the European  Union's  submissions, the USDOC's  rejection of the 
arguments concerning the appli cation of the convergence factor under the 
BPS programme was supported by record evidence, and to this extent, 
reasonably and adequately explained and based on clearly substantiated positive 
evidence.258 
ii. The totality of the USDOC's  discussion of the rules g overning the calculation of 
SPS payments reveals that the USDOC correctly understood that SPS payments 
were made to farmers and that Spain did not implement the SPS on a regional 
basis.259 
iii. In the absence of any suggestion on the part of the European  Union that the 
historical COMOF programme subsidies were not de jure specific, the lack of a 
formal  specificity finding under the US law does not undermine the 
USDOC's  determinations of de jure specificity with respect to the SPS and 
BPS programmes, given that the USDOC considered it had  made sufficient factual 
findings  with respect to the COMOF programme to satisfy itself that the subsidies 
available under the COMOF programme  would be de jure specific under its 
domestic legislation, had it been required to make such a finding as a matter  of 
domestic  law.260 
7.128.   Finally, we note that i n addition  to the alleged inconsistencies  we have addressed above , the 
European  Union  argues that a number of the USDOC 's other findings and explanations are 
incoherent and inconsistent, sometimes plainly contradictory, not based on positive evidence on the 
record, or in cases they are, the content of that evidence is misinterpreted.261 According to the 
European  Union , the contested USDOC 's explanations contain either logical errors262 or errors of 
appreciation or misrepresentations of the legal framework of the subsidy programmes at issue.263 
 
255 See paras. 7.115 -7.116  above.  
256 European  Union's  first written submission, para. 315 (quoting the language from PIDM, 
(Exhibit  EU-1), p. 22, and noting that FIDM, ( Exhibit  EU-2), contains similar language ). FIDM , (Exhibit  EU-2), 
with respect to COMOF provides that "[o]nce the value per hectare was determined using this calculation, a 
farmer would apply for aid in the amount of the number of hectare s multiplied by the value of each hectare". 
(FIDM, ( Exhibit  EU-2), p. 33). 
257 See para. 7.126  above.  
258 See para. 7.85 above.  
259 See p ara. 7.101  above.  
260 See p aras. 7.123 -7.124  above.  
261 European  Union's  first written submission, para.  281. 
262 The alleged "logical error" not addressed elsewhere in this Report concerns certain considerations 
regarding the decoupled nature of SPS and BPS assistance. (European  Union's  first written submissi on, 
paras.  290-292 and 298; opening statement at the first meeting of the Panel, para.  62 and fn  33). 
263 The alleged " errors of appreciation " not addressed elsewhere in this Report concern  (a) data used by 
Spain for regional implementation of the BPS  programme (European  Union's  first written submission, 
para. 299); (b)  determination of the regional value under the BPS  programme (ibid. paras.  305-306); (c)  the 
notion of the "adjusted coefficient" (ibid. paras.  307-308); (d)  the notion of value of entitl ement per hectare 
(ibid. paras.  311-313); (e)  the USDOC's  explanations concerning the Aid to Olive Groves program me 
 WT/DS577/R  
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  The European  Union  argues that these alleged error s demonstrate that the USDOC 's determination 
was not reasonably and adequately explained, and that it was grounded on an erroneous factual 
basis and, therefore,  is inconsistent with Articles  2.1, 2.1(a ), and 2.4 of the SCM  Agreement .264 
7.129.   According to the United States , the European  Union' s arguments variously mischaracterize 
or take out of context the USDOC 's analysis of the de jure specificity of the programmes at issue.265 
With respect to certain alleged errors of appreciation or misrepresentations of the re levant legal 
framework, the United  States  argues that even accepting the European  Union's  allegations would 
not undermine the USDOC 's finding that the BPS and GP  programmes  are de jure specific.266 
7.130.   Having found that the USDOC 's de jure specificity findings are inconsistent with Articles  2.1, 
2.1(a ), and 2.4 of the SCM  Agreement  for the reasons explained above, we do not consider it 
necessary for achieving a positive solution to this dispute to address the remaining 
European  Union's  argum ents267 in support of its claims under Articles  2.1, 2.1(a), and 2.4 of the 
SCM Agreement . 
7.2.3   The European  Union's  claims  under  Articles  2.1, 2.1(b),  and 2.4 of the 
SCM Agreement  
7.131.   The European  Union  claims that the USDOC's  determinations of de jure specificity in its final 
issues and decision memorandum and the Remand Redetermination are inconsistent with 
Articles  2.1, 2.1(b),  and 2.4 of the SCM  Agreement because the USDOC (i)  failed to explore or 
properly evaluate whether the eligibility and subsidy calculation  criteria under the SPS, BPS , and 
GP programmes  were non -specific , within the meaning of Article  2.1(b)  of the SCM  Agreement; and 
(ii) ignored  record evidence showing that this was the case .268 
7.132.   The United  States argues that the eligibility criteria under the SPS, BPS, and GP  programmes  
did not satisfy the non -specificity  requirements  of Article  2.1(b ) of the SCM  Agreement269, and that, 
in any case, even assuming arguendo  that the eligibility  criteria  of those programmes were b ased 
on objective criteria and conditions, the criteria governing the amount  of the subsidies nevertheless 
inherently favoured olive growers , therefore precluding a finding of non -specificity .270 
7.133.   We note that the USDOC made no explicit findings in its preli minary and final determinations 
on the extent to which the SPS and BPS subsidies were "non -specific" within the meaning of the 
functional equivalent of Article  2.1(b)  of the SCM  Agreement under US law. The USDOC did, 
however, discuss and examine this possi bility in the Remand Redetermination making the following 
findings:  
The grant amounts under SPS were not based on the total value of a farm 's overall 
production, or given a flat rate based only on the size of the farm in hectares, or a 
combination of the t wo, or any other neutral or objective criteria pursuant to 
section  771(5A)(D)(ii ) of the Act.  Instead, the SPS grant amounts were based on the 
amount of grants provided under the [COMOF programme]  that were available only to 
olive growers, thereby entrench ing the crop -specific nature of the subsidy under the 
[COMOF programme]  into the criteria for determining the assistance that a farmer would 
 
(ibid. paras.  316-318); and (f)  the USDOC's  alleged consideration of existence of a legal requirement to 
continue olive production (ibid.  paras. 319-329). See also European  Union's  first written submission, 
para. 298; and opening statement at the first meeting of the Panel, para.  62 and fn  35. 
264 European  Union's  first written submission, para.  329. 
265 United  States'  first written submission, pa ra. 87. 
266 See e.g. United  States'  first written submission, paras.  95-96 and 98. In response, the 
European  Union submits that, even admitting for the sake of argument that some of th e alleged  errors and 
contradictions taken individually might not be fatal,  the number of them, taken together, demonstrates  that 
the USDOC "failed to understand [the legislation  governing the programmes at issue]  or gave a biased 
description of its operation ". (European  Union's  opening statement at the first meeting of the Panel , para. 64). 
267 See fns  262-263 above.  
268 European  Union's  first written su bmission, paras.  271-280; 10  June 2020 response to Panel question 
No. 3, para. 26; opening statement at the first meeting of the Panel , paras.  44 and 49-60; 12  November  2020 
response to Panel question No.  9, paras.  96-104; and 11 March  2021 comments on the 
United  States'  25 February  2021 response to Panel question No.  5, paras.  11-14. 
269 United  States'  first written submission, paras.  81 and 84.  
270 United  States'  first written submission, paras.  82-84; second written submission, para. 27. WT/DS 577/R  
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  be eligible to receive under the SPS. In this manner, the value of the grants provided 
under the [COMOF programme]  (the access to which was expressly limited to the olive 
sector ) was preserved in calculating the grants paid under the SPS. Thus, under the 
SPS, access to a subsidy based on the [COMOF programme]  subsidies was expressly 
limited to olive growers. In impleme nting the SPS, the GOS and the EU developed a 
system that applied conditions that were not neutral or objective such that [the USDOC]  
can consider the program to be not specific under section  771(5A)(D)(ii ) of the Act; if 
a farm  produced a product that received certain amounts of assistance prior to the 
implementation of SPS, those amounts were factored into, and therefore preserved in, 
the calculation of the grant amounts to which farmers had access under the SPS.  In this 
way, the SPS did not apply unif orm treatment across the agricultural sector;  olive 
growers continued to benefit as they had, relative to other sub -sectors of the 
agricultural sector, under the [COMOF programme] , under which access to the subsidy 
was expressly limited to olive growers.  
In implementing the BPS, the GOS again legislatively implemented a methodology 
regarding the distribution of benefits that relied on the access to grants provided under 
the SPS, not on any other neutral or objective criteria such as the total value of all c rops 
produced on a farm, the area of the farm, the farmer 's farm income, etc., to determine 
the access to grants to provide under the BPS.  … [The USDOC]  is required to evaluate 
this evidence, pursuant to 19 CFR 351.502(d), in examining whether there is uni form 
treatment in the provision of benefits across the agriculture sector. [The USDOC]  can 
find a subsidy to the agricultural sector to be not specific only if there is record evidence 
of such uniform treatment, or record evidence of neutral and objective criteria pursuant 
to section  771(5A)(D)(ii ) of the Act. … In its implementation of the BPS, the GOS, just 
as it did with the SPS program, the eligibility criteria that limited access to benefits 
provided under the [COMOF programme] were incorporated as a m atter of law and 
embedded the historical differences in crop entitlement amounts among different 
agricultural products.  As a result, farmers who received larger relative amounts of 
assistance under SPS continue to receive larger amounts of assistance under  BPS. 
Therefore, the entitlement values under the BPS for those farmers that grow olives 
retain the historical difference, relative to other farmers , that was inherent in the 
[COMOF programme] .271  
7.134.   The USDOC provided additional explanations of its de jure specificity findings, including as 
regards its consideration of "non -specificity", in responding to certain comments made about the 
consistency of the draft Remand Redetermination with relevant provisions of US law. In particular, 
the USDOC explained as fol lows:  
[The USDOC]  also undertakes the analysis of de jure specificity based upon the 
language set forth in section  771(5A)(D)(ii ) of the [of the Tariff Act of 1930 ]. Under 
clause (ii ) of section  771(5A)(D ) of the Act, where the authority providing the subs idy 
(or the legislation pursuant to which the authority operates), establishes "objective 
criteria or conditions " governing the eligibility for, and the amount of the subsidy, the 
subsidy is not specific as a matter of law. These criteria are if : eligibili ty is automatic, 
the criteria or conditions for eligibility are strictly followed, and the criteria or conditions 
are clearly set forth in the relevant statute, regulation, or other official document so as 
to be capable of verification. The statute states that "the term 'objective criteria or 
conditions ' means criteria or conditions that are neutral and that do not favor one 
enterprise or industry over another. " The [Statement of Administrative Action 
Accompanying the Uruguay Round  Agreement s Act (SAA)]  states that clause (ii ) is a 
corollary of the de jure test. Under clause (ii), a subsidy would not be de jure  specific 
merely because it was bestowed pursuant to certain eligibility criteria; however, "the 
objective criteria or conditions must be neutral, and not favor certain enterprises or 
industries over  another. " 
Therefore, in our analysis of whether the BPS program is de jure specific, consistent 
with the explicit statutory language and SAA language, [the USDOC]  analyzed whether 
the legislation pursuant to which the GOS operates in administering this su bsidy 
expressly limited access to the  subsidy as a matter of law and whether the criteria or 
 
271 Remand Redetermination, ( Exhibit  EU-80), p p. 16-18. (emphasis original; fns  omitted)  WT/DS577/R  
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  conditions for eligibility set forth in the legislation of this subsidy are neutral and do not 
favor one enterprise or industry over another. Under the statute, in  the context of an 
agricultural program such as BPS, the analysis and the application of the term 
"expressly limits " necessarily involve an examination pursuant to both 
section  771(5A)(D(i ) and (ii ) because both clauses (i ) and (ii ) focus on the criteria 
governing access to the subsidy and define the test for de jure specificity. [157] 
…  
To determine access to payments under the BPS, and the criteria or conditions 
governing the eligibility for, and the amount of the subsidy, the BPS legislation expressly 
refers to prior legislation and incorporates by reference the eligibility criteria from the 
prior legislation. An examination of the prior legislation explicitly referenced in and 
incorporated by the BPS demonstrates a linkage between eligibility  for the crop -specific 
payments provided under the prior legislation and the current payments provided under 
the BPS. This link continued to entrench limited access and favored the olive industry.  
Thus, the statutory definition of de jure specificity set f orth under 771(5A)(D)(i ) and 
(ii) is met.272 
157 In most instances of de jure specificity, clause (ii)  need not be referenced because the language 
in the legislation creating the subsidy clearly does not include "objective criteria or conditions," as 
defined by the statute, e.g., the legislation enacting the program provides subsid ies solely to the 
iron and steel industry, the high tech industry, or to state -owned enterprises, etc. Here, we are 
investigating an agricultural program, and 19 CFR 351.502(d)  provides that agricultural subsidies 
will not be specific, either de jure or de facto, solely because the subsidy is limited to the 
agricultural sector. As explained in this redetermination, for the agricultural exception to apply, 
the agricultural subsidy program must include all agricultural products and there must be uniform 
treatment across all agricultural products. Therefore, the clause (ii)  corollary of the de jure 
specificity test is critical for agricultural subsidies when it may not be necessary for examining 
subsidies to industries that do not have a regulatory exception fo r specificity.  
7.135.   We understand from the above passages that the USDOC's  analysis of whether the SPS and 
BPS subsidies were "non -specific", within the meaning of Section  771(5A)(D)(ii ) of the United  States 
Tariff Act of 1930, was intertwined with, and inheren tly dependent upon, its findings of de jure 
specificity under Section  771(5A)(D)(i) . The USDOC's  rejection of the "non -specificity" of the 
SPS and BPS subsidies was driven by its finding that payments under those schemes were explicitly 
linked, as a matter  of law, to crop -specific payments made under the COMOF programme. Having 
already concluded that this aspect of the USDOC's  findings is inconsistent with the 
United  States'  obligations under Articles  2.1, 2.1(a),  and 2.4 of the SCM  Agreement for multiple 
reasons, we do not believe it is necessary for the purpose of achieving a positive solution to this 
dispute to make additional findings concerning the consistency of the USDOC's  "non-specificity" 
analysis and findings with Article  2.1(b)  of the SCM  Agreemen t. Indeed, given that the 
USDOC's  "non-specificity" analysis and findings are intrinsically based on the same alleged facts the 
USDOC relied upon to support its finding of de jure specificity, which we have found in some cases 
were not properly established  or reasonably and adequately explained, we do not see how making 
additional findings under Article  2.1(b)  of the SCM  Agreement would assist the parties in this 
dispute. Accordingly, we decline to make findings with respect to the merits of the 
European  Union's claims under Articles  2.1, 2.1(b),  and 2.4 of the SCM  Agreement.  
7.2.4   The European  Union's  claim  under  Article  1.2 of the SCM Agreement  
7.136.   The European  Union claims that  the United  States acted inconsistently with its obligations 
under Article  1.2 of the SCM  Agreement because the USDOC  determin ed that the BPS and 
GP programmes  are countervailable subsidies and subject ed them to Part V of the SCM  Agreement , 
without properly dem onstrating that they were specific .273 The United  States argues that the USDOC 
substantiated its de jure specificity determination concerning the BPS and GP  programmes  on the 
basis of positive evidence, and asks the Panel to reject the European  Union's  consequential claim 
under Article  1.2 of the SCM  Agreement .274 
 
272 Remand Redetermination, ( Exhibit  EU-80), p p. 47-49. 
273 European  Union's  first written submission, para. 330. 
274 United  States'  first written submission, para. 101. WT/DS 577/R  
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  7.137.   Having found that the USDOC's  de jure specificity findings are inconsistent with Articles  2.1, 
2.1(a),  and 2.4 of the SCM  Agreement, we do not consider it necessary to achieve a positive 
resolution of this dispute to address the European  Union's  claim under Article  1.2 of the 
SCM Agreement.275 
7.3  The European  Union's  claims  in relation  to Section  771B  of the Tariff  Act of 1930  and 
its application  in the ripe olives  countervailing  duty investigation  
7.138.   In its preliminary and final determination s in the Spanish ripe olive s countervailing duty  
investigation , the USDOC determined that the benefit arising from subsidies granted to raw olive 
growers  in Spain could be attributed to three investig ated exporting Spanish ripe olive producers .276 
The USDOC attributed the benefit of such subsidies over relevant arm's  length transactions between 
upstream raw olive growers and downstream ripe olive producers, in the full amount of the financial 
contribution made to the growers, based on a specific provision in the US law, Section  771B of the 
Tariff Act  of 1930  (Section  771B) . In short, Section 771B requires the USDOC to attribute the benefit 
arising from a subsidy granted to a raw agricultural product that is used as an input for a processed 
product if the following two criteria  are met : (i) the demand for the prior stage product is 
"substan tially depend ent" on the  demand for the latter stage  processed product; and (ii ) the 
processing operation adds only "limited value"  to the raw commodity . 
7.139.   The European  Union  claims that Section  771B is " as such"  inconsistent with Article  VI:3 of 
the GATT  1994 and Articles  10, 19.1, 19.3, 19.4 , and 32.1 of the SCM  Agreement. In essence, the 
European  Union alleges that under Section  771B the USDOC is required to impermissibly presume  
that where a subsidy is conferred on an upstream agricultural product  in arm' s length transactions 
between unrelated entities  a benefit will also have been conferred indirectly to a downstream 
processor.277 The European  Union  also claims that the USDOC 's application of Section  771B to 
relevant arm 's length transactions in the ripe olive investigation was inconsistent with these same 
provisions. The United  States  argues that each of the European  Union's  claims fails because the 
European  Union  misunderstands the relevant WTO obligations, the meaning of Section  771B, and 
its application in the underlying investigation.278 
7.140.   We begin by examining the merits of the European  Union's  claims concerning Section  771B 
"as such", before turning to its claims concerning the application of Section  771B in the ripe oliv es 
investigation.  We understand the European  Union's  complaint in both cases to concern the question 
of pass -through in situations involving arm's length transactions between unrelated entities , and not 
transactions that are not at arm's  length or transact ions between related parties .279 
7.3.1   The European  Union's  complaint  against  Section  771B  of the Tariff  Act of 1930  
"as such " 
7.141.   The European  Union alleges that Section  771B is "as such" inconsistent with the 
United  States'  obligations under Article  VI:3 of the  GATT and various provisions of the 
SCM Agreement because it improperly mandates  an approach by the USDOC with respect to benefit 
that excludes the carrying out of a proper pass -through analysis.280  
7.142.   The European  Union  maintains that Article  VI:3 of the  GATT  1994 and Articles  10 and 32.1 
of the SCM  Agreement contain an obligation to co nduct a pass -through analysis for downstream 
products281 and specifically, an analysis of "whether and to what extent the price of the input product 
 
275 See e.g. Panel Report, US – Carbon  Steel (India ) (Article  21.5 – India) , para. 7.203.  
276 See section  7.3.2 below for further details.  
277 European  Union's  first written submission,  paras.  334-336, 346, 357, 361 -363, 369, 377, 380, 
400-401, 414 -415, and 417 . 
278 United  States'  first written submission, paras.  102 and 104.  
279 The European  Union  acknowledges that a different US legal provision not at issue in this dispute 
(19 CFR §351.525(b)(6 )) governs corporations with cross -ownership and therefore applies for transactions that 
are not at arm 's length. Section  19 CFR 351.525(b)(6)(iv ) applies in situations where two or more corporations 
exist and where one corporation can use or direct the individual assets of the other corporation(s ) in essentially 
the same ways it can use its own assets. (Europ ean Union's  first written submission, para. 404 (referring to 
19 USCFR 351.525 , (Exhibit  EU-77))). 
280 See, e.g.  European  Union's  first written submission, paras.  335 and 387 -418. 
281 European  Union's  first written submission, paras.  336-357. WT/DS577/R  
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  is lowered vis -à-vis the alleged indirect beneficiary as a result of the subsidy ".282 The European  Union 
submits  that full pass -through cannot be presumed without undertaking the appropriate analysis.283 
The European  Union  acknowledges that Article  VI:3 and the SCM  Agreement  do not set out a specific 
methodology for th e pass-through analysi s that must be followed in all cases. Nevertheless , the 
European  Union  considers that an examination of a decrease in the level of prices for the input 
product resulting from any subsidy granted to the input producers provides the only appropriate 
method f or the analysis, as the purpose of a pass -through test should be to determine whether  and 
to what extent  the subsidies granted to the input product have passed -through to the downstream 
product.284 The European  Union, however, does not consider the question of whether a price 
comparison constitutes the only appropriate method to assess pass -through is determinative for 
resolving its claim.285 
7.143.   In addition to its claims under Article  VI:3 of the  GATT  1994 and Articles  10 and 32.1 of the 
SCM Agreement , the European  Union  also claims that Section  771B is inconsistent with Articles  19.1, 
19.3, and 19.4 of the SCM  Agreement . The European  Union  contends that Section  771B is also "as 
such" inconsistent  with Articles  19.3 and 19.4 because Section  771B mandates an approach under 
which the USDOC is unable to ensure an "appropriate duty amount in each case" or an "accurate" 
duty amount , as is required by these provisions.286 Section  771B would also consequently violate 
Article  19.1.287 
7.144.   The United  States  argues that t he European  Union  has failed to establish that Section  771B 
is inconsistent with its obligations under the  GATT  1994 and the SCM  Agreement, and argues that , 
in order for the European  Union  to show otherwise, it must demonstrate that the law itself does not  
allow the United  States  to act in accordance with its WTO obligations. For the United  States , this 
may be established by demonstrating that a law necessarily results in a violation of its obligations or 
does not allow the USDOC to act in accordance with the United  States'  obligations.288 The 
United  States  contends  that the European  Union's  legal interpretation lacks any basis in the text or 
negotiating history of the  GATT  1994 or the SCM  Agreement  and is not supported by prior 
WTO dispute settlement reports. The United  States  argues that a plain reading of Article  VI:3 
demonstrates that there is no  obligation to use a specific methodology to calculate the benefit 
conferred by the subsidy found to e xist, much less a specific pass -through methodology. Moreover, 
based on this understanding, the United  States  contends that the European  Union  errs by insisting 
that a pass -through analysis must involve an analysis of price differentiation.289 
7.145.   The United  States argues that  the European  Union's  claims under Article  19 of the 
SCM Agreement as well as  Articles  10 and 32.1 of the SCM  Agreement should also be rejected 
because they are  entirely dependent on the European  Union's  Article  VI:3 claim .290 The 
United  States further maintains that the provisions of Article  19 of the SCM  Agreement  do not 
impose substantive requirements with respect to an investigating authority 's calculation and 
determination of a countervailing duty rate but are "concerned with the primari ly ministerial function 
of imposing and collecting [countervailing duties ] once those  duties  are already  calculated  and 
determined  in accordance with the obligations imposed by the preceding articles of the 
SCM Agreement" .291 
 
282 European  Union' s first written submission, para. 372. 
283 European  Union's  first written submission, paras.  333-334 and 407 -408. 
284 European  Union's  first written submission, para.  407; 10  June 2020 response to Panel question 
No. 14, paras.  90 and 92; and opening statement at the first meeting of the Panel , para. 87. Moreover, the 
European  Union submits that the  GATT  panel in US – Canadian  Pork has already previously established that the 
two conditions of Article  771B do not represent the factors that need to be as sessed in order to examine 
whether benefit has passed -through. (See, e.g.  European  Union's  first written submission, para.  372 (referring 
to GATT  Panel Report, US – Canad ian Pork, para. 4.10)).  
285 See, e.g. European  Union's  second written submission, para.  75. 
286 European  Union's  first written submission, paras.  386 and 420.  
287 Article  19.1 of the SCM  Agreement requires an investigating  authority to make a final determination 
of the amount of the sub sidy and a final determination of injury prior to imposing a countervailing duty in 
accordance with the provisions of Article  19 of the SCM  Agreement.  
288 United  States'  25 February  2021 response to Panel question No.  9, paras.  35-37. 
289 United  States'  first written submission, paras.  105-113. 
290 United  States'  first written submission, paras.  108-123 and 132; 12  November  2020 responses to 
Panel question No. 12, para.  41, and No.  15, paras.  46-49. 
291 United  States'  12 November  2020 response to Panel question No.  15, para.  46. (emphasis  original)  WT/DS 577/R  
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  7.146.   We agree with past panel and Appellate  Body reports that in order for an "as such" challenge 
against a provision of domestic legislation to succeed, the complain ing Member must establish that 
the relevant provision of domestic law requires  the responding Member to violate its obligations 
under the relevant covered  agreement or otherwise restricts, in a material way, the responding 
Member's  discretion to act in a m anner that is consistent with those obligations .292 Guided by this 
standard, we will review the merits of the European  Union's  "as such " claims in the sections  that 
follow, by first identifying and considering the legal requirements for conducting a pass -through 
assessment that is consistent with the relevant provisions of the  GATT  and the SCM  Agreement, and 
then by determining whether Section  771B requires  the USDOC to act inconsistently with those 
requirements or whether it materially  restricts  any USDOC d iscretion to act consistently with the 
same requirements.  
7.3.1.1   Legal  requirements  for conducting  a pass-through  analysis  
7.147.   There is no disagreement between the parties that where a producer of the upstream input 
product operates at arm 's length from the producer of the downstream product produced using the 
upstream input,  an investigating authority is required, under Article  VI:3 of the  GATT  1994 and 
Article  10 of the SCM  Agreement, to establish that the benefit of the subsidy provided directly in 
respect of the u pstream product has been passed -through to the downstream product in order to 
levy countervailing duties on imports of the downstream product.293 The parties also agree that there 
is no prescribed methodology in either of these provisions for assessing pass -through.294 Thus, we 
understand the parties to accept that investigating authorities retain a degree of discretion with 
respect to how to determine the existence and extent of the pass -through of indirect subsidies. We 
share the parties'  views on all these points.  
7.148.   We note that Article  VI:3 of the  GATT  1994 provides as follows:  
No countervailing duty shall be levied on any product of the territory of any contracting 
party imported into the territory of another contracting party in excess of an amount 
equal to the estimated bounty or subsidy determined to have been granted, directly or 
indirectly, on the manufacture, production or export of such product in the country of 
origin or exportation, including any special subsidy to the tra nsportation of a particular 
product. The term "countervailing duty" shall be understood to mean a special duty 
levied for the purpose of offsetting any bounty or subsidy bestowed, directly, or 
indirectly, upon the manufacture, production or export of any m erchandise.  
7.149.   Article  10 of the SCM  Agreement and footnote 36 provide:  
Members shall take all necessary steps to ensure that the imposition of a countervailing 
duty[36] on any product of the territory of any Member imported into the territory of 
another Memb er is in accordance with the provisions of Article  VI of GATT  1994 and the 
terms of this  Agreement. Countervailing duties may only be imposed pursuant to 
investigations initiated and conducted in accordance with the provisions of 
this Agreement and the  Agreement on Agriculture.295 
36 The term "countervailing duty" shall be understood to mean a special duty levied for the purpose 
of offsetting any subsidy bestowed directly or indirectly upon the manufacture, production or export 
of any merchandise, as provided for in paragraph  3 of Article  VI of GATT  1994. 
 
292 See, e.g. Appellate  Body Reports,  US – Oil Country  Tubular  Goods  Sunset  Reviews , para. 172; EU – 
Biodiesel  (Argentina) , para. 6.229; and US – Carbon  Steel, para. 162. 
293 See, e.g.  European  Union's  10 June 2020 response to Panel question No.  14, para.  92 ("the 
EU acknowledges that an authority in principle has discretion regarding its method of 
analysis .") The United  States maintains that Article  14 of the SCM  Agreement fu rther supports its position that 
no particular methodology is required for determining whether a benefit has passed -through to a downstream 
producer. In this respect, the United  States refers to the chapeau  of Article  14, which establishes "guidelines " 
to be followed in calculating the benefit to a recipient. (United  States'  12 November  2020 response to Panel 
question No.  18, para.  52 (referring to Appellate  Body Reports, US – Softwood  Lumber  IV, paras.  91-92; 
Japan– DRAMs  (Korea) , para. 191; and Panel Report, US – Anti-Dumping  and Countervailing  Duties  (China) , 
para. 11.55 )). 
294 See, e.g.  European  Union's  first written submission, paras.  341-357; opening statement at the first 
meeting of the Panel, para.  79; and United  States'  first written s ubmission, paras.  109-113. 
295 Fn omitted.  WT/DS577/R  
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  7.150.   The first sentence of Article  VI:3 establishes that no countervailing duty shall be levied on 
any imported product in excess  of an amount equal to the subsidy determined  to have been g ranted, 
directly  or indirectly , on the manufacture, production, or export of that product. The second sentence 
of Article  VI:3 as well as footnote 36 to Article  10 define a countervailing duty as a special duty 
levied for the purpose  of offsetting  any subs idy bestowed, directly or indirectly, upon the 
manufacture, production, or export of any merchandise . We agree with past panels and the 
Appellate  Body that it follows from a combined reading of these two provisions that Members are 
entitled to offset "indi rect" subsidization by imposing duties on imported products that benefit from 
subsidies conferred on "upstream" companies and products.296 In our view, it also follows from the 
terms of Article  VI:3 and, in particular, the requirement not to apply a counter vailing duty in excess  
of the estimated  amount  of subsidy  determined to have been granted on the imported product, that 
an importing Member is not entitled to simply presume that a subsidy bestowed on an input product 
passes through, in total or in part, t o the processed imported product. Rather, an investigating 
authority must work out, as accurately as possible, how much of the subsidy has flowed indirectly 
from an input product to the downstream product, to ensure that any countervailing duty imposed 
on the downstream product is not in excess of the total amount of subsidies bestowed on the 
investigated product. To this end, an investigating authority must take into account all relevant facts 
and circumstances to ensure that a countervailing duty is not i mposed in excess of the estimated 
subsidy. Thus, we agree with the Appellate  Body that countervailing duties may not be applied on 
any amount of a subsidy that has not been found to have passed -through to the imported product.297 
We find this understanding to be consistent with the views of the  GATT  panel in US – Canadian  Pork, 
which  considered Canadian claims under Article  VI:3 of the  GATT  1947 with respect to the 
application of Section  771B in a USDOC countervailing duty investigation of subsidies granted to 
imports of fresh, chilled, and frozen pork from Canada.298 
7.151.   Having said that,  we note that neither Article  VI:3 nor Article  10 of the SCM  Agreement 
prescribe that a particular methodology must be followed to perform a pass -through analysis where 
one is required. To this extent, investigating authorities have a certain amount of discretion in 
evaluating whether and to what extent the benefit of a subsidy provided directly to a producer of an 
upstream product has passed -through to the downstream product produced by an unrelated 
enterprise (an indirect subsidy). The parties in this dis pute disagree, however, as to how that 
discretion can be exercised, and, in particular, as to the kind of considerations and factors that must, 
at a minimum, be included in a determination of the existence and extent of pass -through.  
7.152.   The European  Union ack nowledges that Article  VI:3 and the SCM  Agreement do not 
prescribe a specific methodology to assess pass -through. Nonetheless the European  Union argues 
that, in the case of input subsidies, only an assessment of whether the purchase price of the input 
product has been lowered via "a price comparison of some sort"299 can allow an investigating 
authority to meaningfully assess whether pass -through of benefit has occurred.300 For the 
European  Union, such an approach would be consistent with the meaning of "benef it" in 
Article  1.1(b)  of the SCM  Agreement. In this regard, the European  Union submits that the 
determination of "benefit" seeks to identify whether the financial contribution has made the recipient 
"better off" than it would otherwise have been, absent th at contribution.301 Accordingly, for the 
 
296 Appellate  Body Report, US – Softwood  Lumber  IV, para. 140 ( "[t]he phrase 'subsid[ies] 
bestowed  … indirectly ', as used in Article  VI:3, implies that financial contributions by the government to the 
production of inputs  used in manufacturing products subject to an investigation are not, in principle, excluded 
from the amount of subsidies that may be offset through  the imposition of countervailing duties on the 
processed  product " (emphasis original) ). See also Panel Reports,  US – Softwood  Lumber  IV, para. 7.91; US – 
Upland  Cotton , para.  7.1180; and Mexico  – Olive Oil, paras.  7.137 -7.139.  
297 The Appellate  Body in US – Softwood  Lumber  IV found that only the amount by which an indirect 
subsidy granted to producers of inputs flows through to the processed product, together with the amount of 
subsidy bestowed directly  on producers of the processed product, may be offset th rough the imposition of 
countervailing duties. ( Appellate  Body Report, US – Softwood  Lumber  IV, paras.  140-141).  
298 GATT  Panel Report, US – Canadian  Pork, para.  4.6 ("Article  VI:3 stipulates that a countervailing duty 
levied on any product shall not exceed an amount equal to the subsidy granted directly or indirectly on the 
production of 'such product'. According to this clear wording, the United  States may impose a countervailing 
duty on pork only if a subsidy has been determined to have been bestowe d on the production of pork; the 
mere fact that trade in pork is affected by the subsidies granted to producers of swine is not sufficient .") 
299 European  Union's  10 June 2020 response to Panel question No.  14, para.  92. 
300 European  Union's  first written subm ission, paras.  372 and 408; 10  June 2020 response to Panel 
question No.  14, para.  92; and second written submission, para . 76. 
301 European  Union's  second written submission, para.  77. See also Appellate  Body Report, Canada  – 
Aircraft , para.  157. WT/DS 577/R  
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  European  Union, in order to determine whether a downstream product has benefited from the 
subsidies provided to an unrelated producer of the upstream input product, an assessment of 
whether the purchase price of the input product has been lowered relative to "market" prices would 
be appropriate. Finally, the European  Union maintains that other considerations may also be relevant 
to the assessment, such as an evaluation of the concentration of the relevant markets, the  market 
power of the different producers and processors, or the extent of national or international 
competition.302 
7.153.   The United  States emphasizes that Article  VI:3 of the  GATT  1994 and the SCM  Agreement 
are silent as regards the methodology for evaluating in direct subsidization. For the United  States, this 
silence means that an investigating authority has discretion to decide how it should conduct a 
pass-through analysis in a particular factual circumstance.303 The United  States further argues that 
the Europea n Union's  focus on a price comparison is unsupported by prior WTO dispute settlement 
reports or the negotiating history of the  GATT  1994 or the SCM  Agreement, neither of which specify 
a methodology or indicate how an investigating authority should determin e whether and to what 
extent a benefit is conferred to a downstream producer.304 
7.154.   In our view, the discretion afforded to an investigating authority under Article  VI:3 for the 
purpose of establishing the pass -through of subsidies is not unfettered. As alread y noted, pursuant 
to Article  VI:3 an investigating authority is required to analyse to what extent direct subsidies on 
inputs may have indirectly flowed to the processed investigated product where the respective 
producers operate at arm 's length and which therefore may be included in the determination of the 
estimated total amount of subsidies bestowed on the investigated product. In our assessment, this 
means that an investigating authority must provide an analytical  basis for its findings of the existence  
and extent of pass -through that takes into account facts and circumstances  that are relevant  to the 
exercise and that are directed to ensuring that any countervailing duty imposed on the downstream 
product is not in excess of the total amount of subsidies  bestowed on the investigated product.305 
Thus, we do not understand an investigating authority's  discretion in evaluating the pass -through of 
subsidies under Article  VI:3 to be so wide as to permit it to exclude any consideration of facts and 
circumstances  that may be relevant to the very analysis that it must perform.  
7.155.   Finally, we note the parties'  disagreement about the role of the prices of a subsidized input 
product in a pass -through analysis, and the United  States'  objection to what it  considers  
would be a "one -size-fits-all" approach to assessing pass -through.306 Despite the 
European  Union's  characterization of input price comparisons as the only meaningful way to assess 
pass-through, we do not consider that any findings on our part with  respect to this matter are 
necessary to achieve a positive solution to the parties'  dispute. Accordingly, we will proceed to 
consider the European  Union's  claims guided by the understanding of the requirements of 
Article  VI:3 and Article  10 we have set ou t above, namely, that an investigating authority must 
provide an analytical  basis for its findings of the existence and extent of pass -through that takes 
into account facts and circumstances  that are relevant  to that exercise. The pass -through of a 
 
302 The Europ ean Union observes, for instance, that if the producers  of the raw agricultural product 
could export their products internationally, this would reduce dependency on the domestic market. 
(European  Union's  first written submission, paras.  408 and 410 -411; 12  November  2020 response to Panel 
question No.  12, para.  116).  
303 United  States'  first written submission, paras.  105-110 and 113 (quoting Panel Report, EC – Bed 
Linen  (Article  21.5 – India) , para.  6.87): "[t]he provisions of the  GATT  1994 and the SCM  Agreem ent are silent 
on this issue. The EU  seeks to fill that silence with a specific, methodological obligation. However, this silence 
cannot be so filled. Rather, '[t]he most logical conclusion to be drawn from this silence is that the choice … is 
up to the in vestigating authority'  regarding how a pass -through analysis should be conducted in a particular 
factual circumstance."  (fn omitted)  
304 United  States'  first written submission, paras.  128-130 (referring to Appellate  Body Report, US – 
Softwood  Lumber  IV, paras.  143 and 154; and  GATT  Panel Report, US – Canadian  Pork, paras.  4.8-4.10).  
305 Contrary to the United  States'  assertions, we find this conclusion to be consistent with views 
expressed by  Members during the Uruguay Round about the need to investigate  further  in cases where the 
market price is suspected of being unduly influenced by the subsidy on the input in question. 
(United  States'  first written submission, para.  127; GATT, Uruguay Roun d-Group of Negotiations on 
Goods -Negotiating Group on Subsidies and Countervailing Measures -Subsidies and Countervailing Measures, 
Note by the Secretariat, MTN.GNG/NG10/W/4, p.  17). 
306 The United  States submits that a requirement to determine whether a decr ease in the level of prices 
for the input product resulted from any subsidy granted to the input producers might lead to a situation where 
it would be impossible to countervail an indirect subsidy if a price differential could not be observed. 
(United  States' first written submission, para.  127).  WT/DS577/R  
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  subsidy  must be shown to exist by determining  the extent to which subsidies on input products may 
have been indirectly  bestowed  upon the processed investigated products. In the sections  that follow, 
we will examine the merits of the European  Union's  complaint by considering whether Section  771B 
requires  the USDOC to act in a manner inconsistent with these obligations, and if not, whether it 
materially  restricts  any USDOC discretion to act consistently with the same requirements.  
7.3.1.2   Legal  characterization  of the opera tion of Section  771B  of the Tariff  Act of 1930  
7.156.   We next evaluate the European  Union's  claim that Section  771B requires the USDOC to 
impermissibly presume pass -through of any subsidies granted to an upstream raw agricultural 
product to the downstream process ed product in all cases where the producer of the raw agricultural 
product and the processor enter into arm's length transactions and the two conditions in 
Section  771B are met.307 
7.157.   Section  771B of the Tariff Act of 1930  provides as follows:  
In the case of an agricultural product processed from a raw agricultural product in 
which  – 
(1) the demand for the prior stage product is substantially dependent on the demand 
for the latter stage product, an d 
(2) the processing operation adds only limited value to the r aw commodity , 
countervailable subsidies found to be provided to either producers or processors of the 
product shall be deemed to be provided with respect to the manufacture, production, 
or exportation of the processed product.308 
7.158.   The USDOC is directed to apply Section  771B in countervailing duty investigations involving 
an "agricultural product processed from a raw agricultural product ". Section  771B stipulates that 
countervailable subsidies found to have been provided to the raw agricultural p roduct "shall be 
deemed" to be provided to the agricultural processed product, when two cumulative  factual 
circumstances exist:  first, when the demand for the prior stage product is substantially dependent 
on the demand for the latter stage product ; and se cond, when the processing operation adds only 
limited value to the raw commodity . In this way, Section  771B instructs the USDOC to find that 
subsidies  have been  provided to  the manufacture, production, or exportation of the processed 
product  when the two p rescribed factual circumstances are fulfilled and without reference to, or 
consideration of, any other factors . 
7.159.   The European  Union  contends that the use of the auxiliary term "shall" in Section  771B 
signifies  that Section  771B is  a mandatory provision.  Accordingly, the European  Union contends  that 
the USDOC has no margin of discretion in determining the amount of the subsidy that can be said 
to have passed  through to the downstream product when the factual circumstances contained in 
Section  771B are fulfill ed. For the European  Union, this is confirmed from the determination in the 
underlying ripe olives investigation and in  previous USDOC determinations involving 
Section  771B.309 
7.160.   At the core of its claim, the European  Union  considers that the two factual circumstances 
described in Section  771B – first, concerning whether demand for the input substantially depends 
on demand for the processed product, and second, whether processing adds only limited  value – are 
alone  inapt for  determining the existence and precise amount of pass -through as required under the 
applicable legal standard. The European  Union  argues that  Section  771B requires the USDOC to 
deem the full amount  of subsidies  granted to a raw agricultural product to have  been granted to the 
processed product in all cases without considering any other factors,  meaning that the USDOC must 
presume  that the full amount  of benefit passes through to the indirect subsidy recipient without any 
 
307 European  Union's  first written submission,  paras.  334-336, 346, 357, 361 -363, 369, 377, 380, 
400-401, 414 -415, and 417 . 
308 19 USC 1677 -2, (Exhibit  EU-52). 
309 European  Union's  first wr itten submission, paras.  414-418. See also FIDM, (Exhibit  EU-2), p. 43; and 
Frozen warmwater shrimp FIDM , (Exhibit  EU-51), p. 43. WT/DS 577/R  
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  analysis of the precise benefit amou nt that passes through.310 The European  Union argues that s uch 
a presumption violates the  requirements of Article  VI:3 of the GATT 1994 and Article  10 of the 
SCM Agreement. Hence, the European  Union maintains that every application of Section  771B by 
the US DOC will necessarily lead to a violation  of the applicable WTO provisions .311  
7.161.   We understand the United  States'  defence of  Section  771B to rest on two main lines of 
argument . First, the United  States  argues that the legal justification for Section  771B derives from 
inherent flexibilities in the  GATT  1994 and SCM  Agreement , which do not prescribe or prohibit any 
specific methodology to determine pass -through.312 Second, the United  States argues that the 
two factual circumstances contained in Section  771B are on their own appropriate for establishing 
pass-through in the context of the special commercial and economic circumstances facing agricultural 
input products used to process downstream products.313 The United  States maintains that 
Section  771B thus " provides a basis to make a finding attributing benefit to a downstream product, 
in the way that the 'pass -through'  concept has been understood".314 
7.162.   As we have discussed above315, Article  VI:3 of the  GATT  1994 and Article  10 of the 
SCM Agreement  do not prescribe a particular methodology for determining pass -through. However, 
whatever methodology is chosen, an investigating authority must analyse to what extent subsidies 
on inputs may be included in the determination of the total amount of subsidies be stowed upon 
processed products. This must be done to ensure that countervailing duties are not applied in an 
amount that is in excess of the estimated subsidy determined to have been granted to the 
investigated product. Therefore, to ensure compliance with  the requirements of Article  VI:3 of the 
GATT 1994 and Article  10 of the SCM  Agreement, an investigating authority must take into account 
facts and circumstances that may be relevant to that determination and is not entitled to exclude 
from its determination  factors that are potentially  relevant .316 
7.163.   The United States considers that Section  771B provides an appropriate alternative method 
in the context of raw agricultural commodities in light of the special commercial and economic 
circumstances present in markets for such commodities, namely that these markets are 
systematically chara cterized by "perfect competition". In such markets, where products are 
undifferentiated and market -entry is unrestricted, the United  States contends that producers of the 
raw products have no choice but to accept the prevailing market price, rendering them  "price takers" 
that are unable to charge a price higher than the price a processor could obtain from another 
homogenous producer (which may or may not be subsidized). In these circumstances, the 
United  States argues that market prices could not be used to  determine whether the benefit of a 
subsidy granted to the upstream raw input producer has passed -through to a downstream processor 
because there would be no price differentiation. Thus, the United  States argues that, because a raw 
agricultural commodity i s often devoted completely to the production of a processed product and a 
product processed from a raw agricultural commodity is often produced substantially from the raw 
 
310 The European  Union submits that the question of whether an input subsidy passes through may  
depend on an array of factors affecting the compet itive conditions in the market for the input product, 
including the level of concentration or fragmentation of the market on the seller and purchaser side , the 
market power of the different producers and processors, the existence of cooperati ves or other j oint 
representative bodies yielding market power via input producers , or the extent of national or international 
competition. The European  Union submits that the two criteria in Section  771B may, at best, contribute to 
assessing the likelihood of pass -through benefit. However, the European  Union argues that a likelihood of 
pass-through does not "establish ", "find", or "determine " the existence of pass -through of benefit as required 
under the relevant provisions . (European  Union's  first written submission, p aras. 407-408; second written 
submission, paras.  71-72; 12  November  2020 response to Panel question  No. 12, para. 116; and 
11 March  2021 comments on United  States'  25 February  2021 response to Panel question No.  9, para.  36). 
311 European  Union's  first written submission, paras.  22, 335, and 390.  
312 United  States'  first written submission, paras.  109-132; 12  November  2020 response to Panel 
question No.  10, para.  36. 
313 United  States'  first written submission, paras.  135-140. 
314 United States'  first written submission, para.  135; see also opening statement at the first meeting of 
the Panel, para.  34; and 12  November  2020 response to Panel question No.  10, para.  36. 
315 See section  7.3.1.1  above.  
316 We note that the  GATT  panel in US – Canadian  Pork held the view that the words in Article  VI:3 "to 
determine " and "estimated ", as well as the practices of the contracting parties under that provision , indicated 
that the decision as to the existence of a subsidy must result  from an examination of all relevant 
facts.  (GATT  Panel Report, US – Canadian  Pork, para.  4.8). WT/DS577/R  
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  product , whenever these two circumstances exist a subsidy that affects the production  of the raw 
product necessarily affects trade in the product .317 
7.164.   The United  States'  explanation is reflected in the legislative history of the enactment of 
Section  771B, which the United  States  has cited in this dispute.318 As discussed in the 
US Congression al record, in conducting a pass -through assessment for components used to produce  
finished  manufactured  product s, the USDOC applies a different "upstream subsidies" test , as 
contained in Section  1677-1(b) of US law (Section  771A of the Tariff Act of 1930) .319 Pursuant to 
that test , the USDOC enquires into whether  the subsidy bestows a "competitive benefit" on the 
manufactured product under investigation. A competitive benefit is found where the price paid for 
the input product is determined to have bee n lower than would otherwise be paid in an arm's  length 
transaction with another seller.320 The Congressional record  excerpt shows that when Section  771B 
was enacted this type of test was considered to be incompatible with the nature of agricultural 
commodi ty markets , under the view  that the price of products sold on a commodity basis would be 
essentially the same for all commodities sold at a given time in a given market.321 Thus, it was 
argued that if Section  1677-1(b) were applied in the investigation of agricultural commodities,  the 
USDOC would be unable to detect whether a subsidy has passed -through based on a price 
differentiation test, preventing the USDOC from countervail ing those subsidies, and thereby 
"permi t[ting]  wholesale circumvention"322 of US countervailing duty laws.  
7.165.   The European  Union  disagrees with the United  States'  contention that agricultural 
commodities a re systematically characterized by "perfect competition ". The European  Union 
contends that certain agricultural markets  may "at best , display certain features "323 inherent to a 
perfectly competitive market, but that often conditions required for a perfectly competitive market 
do not exist in the agricultural sector. In this respect, the European  Union submits that there are 
typically a limited number of buyers and sellers for many agricultural products, wherein cooperatives 
often exercise significant seller power over purchasers  and there are constraints on entry and exit 
into the market.324 The European  Union further submits that the United States'  "perfect competition" 
argument was rejected by the  GATT  panel in US – Canadian  Pork.325 
7.166.   We are not convinced that input producers always will be "price takers" in all markets for all 
raw agricultural products falling within the scope of Section  771B. In this regard, we share the view 
of the European  Union that it is reasonable to believe that variations may exist in the competitive 
conditions of different product markets, including in those for raw agricultural commodities, such 
that any given ma rket may or may not be perfectly competitive. While the two factual circumstances 
identified in Section  771B may be relevant to an examination of whether a subsidy to a raw 
agricultural product has passed -through to a processed agricultural product, the pr obative value of 
those factors will, in our view, depend upon the specific facts of the situation in question, including 
the nature of the specific market for the input product at issue and all of the conditions of competition 
in that market.  
7.167.   Section  771B does not leave  open the possibility  for the USDOC to consider factors that may 
be affecting the market for the investiga ted product  other than those Section  771B lists explicitly . 
For example, another factor could be the degree to which raw input sellers face pricing pressure  – a 
feature the United  States  submits is systematically present in markets for all raw agricultural  
commodities.  Likewise, Section  771B does not envisage that the USDOC should consider the market 
power of the different producers and processors, or the extent to which national or international 
competition could potentially affect the reliability of input  product pricing. On the contrary, 
 
317 United  States'  first written submission, para.  139 (referring to Congressional record S8787 -01, 
(Exhibit  USA-9), p. S8815 ); 12 November  2020 response to Panel question No.  11, paras.  38-39. 
318 United  States'  first written submission, paras.  136-137 (referr ing to Congressional record  S8787 -01, 
(Exhibit  USA-9), pp. S8814 -S8815).  
319 19 USC 1677 -1, (Exhibit  EU-49). 
320 Congressional record  S8787 -01, (Exhibit  USA-9), p. S8815.  
321 Congressional record  S8787 -01, (Exhibit  USA-9), p. S8815.  
322 Congressional record  S8787 -01, (Exhibit  USA-9), p. S8815.  
323 European  Union's  second written submission, para.  65. 
324 The European  Union submits that the US  raw olive market provides an example of a market that is 
not perfectly competitive due to the fact that it has only two ol ive purchasers and prices are negotiated on 
behalf of growers by the Olive Growers Council. (European  Union's  second written submission, para.  65). 
325 European  Union's  second written submission, para.  63 (referring to  GATT  Panel Report, US – 
Canadian  Pork, para.  3.15).  WT/DS 577/R  
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  Section  771B requires  the USDOC to make a determination of pass -through in the absence of any 
consideration of whether such facts and circumstances may be relevant to a showing of 
pass-through. To this extent, Section  771B operates as if perfect market conditions exist, as a matter 
of fact, in all cases involving investigated raw agricultural input products and downstream processed 
products.  Section  771B, therefore, shuts out any consideration of the circumstances of any specific 
case other than the two circumstances that are mandated. Circumstances that are non -mandatory 
from the perspective of Section  771B are not able to be considered by the investigating authority, 
meaning that Section  771B limits the investigating auth ority's analysis of the factual extent of any 
pass-through.  
7.168.   Because Section  771B instructs  the USDOC to make a determination of pass -through in the 
absence of any consideration of such potentially relevant factors, we consider that Section  771B 
directs the USDOC to presume  the existence of pass -through between raw and processed agricultural 
products whenever the two factual circumstance s it prescribes are established. We further more note 
that Section  771B directs  the USDOC to simply " deem " countervailable subsidies found to have been  
provided to upstream producers of the raw agricultural product to have passed -through  to the 
downstream processed product.326 We understand this to mean that there is no possibility for the 
USDOC to attribute to the downstream processed product anything less than the full amount of the 
subsidies provided to upstream producers of the raw agricultura l product .327 We do not see how an 
evaluation of the two factual circumstances in Section  771B alone  would provide a basis to calculate 
with any precision the degree or the extent of pass -through. Thus, not only does Section  771B 
require the USDOC to presum e the existence of pass -through when the two designated factual 
circumstances are present, it also effectively requires the USDOC to treat the full amount of any 
countervailable subsidy provided to a raw agricultural input as if it had passed -through to th e 
investigated processed product.  
7.169.   We have found above  that under the terms of Article  VI:3 of the  GATT  1994 and Article  10 
of the SCM  Agreement , an investigating authority is required to establish the existence and extent 
of indirect subsidization ( i.e. pass-through  of a benefit)  taking into account facts and circumstances  
that are relevant  to that exercise. An investigating authority is not entitled to exclude from its 
determination of pass -through factors that are potentially relevant to its determination and to 
proceed on the basis of a presumption  of indirect subsidization. Accordingly,  for these reasons,  we 
find that Section  771B is inconsistent with Article  VI:3 of the  GATT  and Article  10 of the 
SCM Agreement because it does not leave  open the possibility  for the USDOC to consider other 
factors affecting the market for the investigated product.  
7.3.1.3   Conclusion  
7.170.   We conclude, for the reasons set forth above, that Section  771B is as such inconsist ent with 
the United  States'  obligations under Article  VI:3 of the  GATT  1994 and Article  10 of the 
SCM Agreement because it requires  the USDOC to presume  that the entire  benefit of a subsidy 
provided in respect of a raw agricultural input product passes thr ough to the downstream processed 
agricultural product, based on a consideration of only the two factual circumstances prescribed in 
that provision, without leaving open the possibility of taking into account any other factors that may 
be relevant to th e determination  of whether there is any pass -through and, if so, its degree . 
7.171.   In addition to its claims under Article  VI:3 of the  GATT  1994 and Article  10 of the 
SCM Agreement , we recall that the European  Union  also grounds its claims against Section  771B 
under Articles  19.1, 19.3, 19.4, and 32.1 of the SCM  Agreement . The European  Union  argues that 
the USDOC acted inconsistently with Article  19.1 by imposing countervailing duties in the absence 
of a final determ ination of the existence and amount of a subsidy; with Article  19.3 by failing to levy 
countervailing duties in "appropriate amounts in each case"; and with  Article  19.4 by levying 
countervailing duties in excess of the amount of the subsidy found to exist .328 We understand the 
factual basis for each of these claims to be the same as the basis for the European  Union's  claims 
 
326 19 USC 1677 -2, (Exhibit  EU-52). 
327 The United  States has not argued that Section  771B leaves the USDOC with any discretion to 
attribute less than the full amount of subsidies found to have been provided  to upstream producers . 
328 See, e.g.  European  Union's  first written submission, para.  341. WT/DS577/R  
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  under Article  VI:3 of the  GATT  1994 and Article  10 of the SCM  Agreement .329 The European  Union 
also makes a claim under Article  32.1 that is consequential in nature.330 Having found that the 
Section  771B of the Tariff Act of 1930 is  "as such"  inconsistent with Article  VI:3 of the  GATT  1994 
and Article  10 of the SCM  Agreement , we do not consider it necessary to make additional findings 
with respect to violations of other provisions contained in the SCM  Agreement in the same factual 
circumstances. We therefore decline  to make further findings as to  whether Section  771B is also 
inconsistent with Articles  19.1, 19.3, 19.4, and 32.1 of the SCM  Agreement . 
7.3.2   The European  Union 's challenge  concerning  the USDOC 's application  of 
Section  771B  in the Spanish  ripe olive s countervailing  duty investigation  
7.172.   The European  Union claims that in applying Section  771B in the underlying ripe olives 
investigation, the USDOC acted inconsistently with Article  VI:3 of the  GATT  1994 and Articles  10, 
19.1, 19.3, 19.4 , and 32.1 of the SCM  Agreement. Not unlike its submissions with respect to its 
complaint against Section  771B "as such", the European  Union argues that the USDOC acted 
inconsistently with the United  States'  WTO obligations in the underlying Spanish ripe olives 
investigation because it improperly presumed  the attribution of the full amount of the benefit of the 
subsidies provided to raw olive producers for rel evant arm's  length transactions with ripe olives 
processors, without undertaking the requisite analysis.331 The United  States argues that the 
European  Union  has failed to demonstrate that the USDOC acted inconsistently with its obligations in 
applying Secti on 771B in the underlying investigation.  
7.173.   We first recall the USDOC's  determination of the attribution of benefit in the underlying 
investigation and thereafter assess whether this determination was inconsistent with the applicable 
legal standard set forth in section  7.3.1.1  above.  
7.3.2.1   The USDOC's  determination  of benefit  in the Spanish  ripe olives countervailing 
duty investigation  
7.174.   In its preliminary and final determination s in the Spanish ripe olive s countervailing d uty 
investigation, the USDOC found that subsidies granted to growers of raw olives in Spain could be 
attributed to three investigated  ripe olive producers, Agro Sevilla, Ángel  Camacho , and Aceitunas 
Guadalquivir.332 In each case , the transactions between th e growers and the producers were 
confirmed to have been carried out at arm 's length with unaffiliated companies.333 In making its 
determination, the USDOC found that both factual circumstances identified in Section  771B were 
established .334 Regarding the first factual circumstance , the USDOC found that  the demand for the 
prior stage product is substantially dependent on the demand for the latter stage product.335 
 
329 European  Union's  first written submission, paras.  382-383 and 420 -421. The United  States  contends  
that the European  Union's  claims under Article  19 "appear entirely  dependent " on its claim under Article  VI:3 of 
the GATT  1994. (United  States'  first written submission, para. 108). 
330 Article  32.1 provides:  "[n]o specific action against a subsidy of another Member can be taken except 
in accordance with the provisions of  GATT  1994, as interpreted by this  Agreement. " 
331 See, e.g.  European  Union's  first written submission, paras.  332 and 334.  
332 Agro Sevilla prelim inary determination , (Exhibit  EU-37), p.  2; Agro  Sevilla final determination , 
(Exhibit  EU-39); Ángel Camacho preliminary determination , (Exhibit  EU-38), p.  2; Ángel Camacho final 
determination , (Exhibit  EU-40); Aceitunas Guadalquivir preliminary determinat ion, (Exhibit  EU-36), p.  2; and 
Aceitunas Guadalquivir final determination , (Exhibit  EU-41), pp.  2-3. 
333 Agro Sevilla response to the sourcing questionnaire (public version) , (Exhibit  EU-17), answers to 
questions 1, 6 , and 8 and exhibit  2; Extract from Agro Sevilla  final calculation data , (Exhibit  EU-43 (BCI)); 
Ángel Camacho  response to the sourcing questionnaire  (public version), (Exhibit  EU-68), answers to 
questions  1, 6, and 8 and exhibit  2; Extract from Ángel Camacho final calculation data, ( Exhibit  EU-45 (BCI)); 
Aceitunas Guadalquivir  response to the sourcing questionnaire , (Exhibit  EU-63), answers to questions 1, 6 , and 
8 and exhibit  2; and Extract from Aceitunas Guadalquivir final calculation data , (Exhibit  EU-47 (BCI)).  
334 See the text of Section  771B in para.  7.157  above.  
335 The USDOC found that  the percentage of raw olives that are used to produce table olives (including 
ripe olives ) of 8% was "substantial " and therefore concluded  that the demand for raw olives is "dependent " 
upon demand for table olives.  (PIDM , (Exhibit  EU-1), pp. 15-16; FIDM, (Exhibit  EU-2), pp. 21-22). The 
respondents to the investigation subsequently challenged the USDOC's  analysis before the USCIT. On 
17 January  2020 the USCIT held that the USDOC had  applied an impermissible interpretation of the term 
"substantially dependent " under  Section  771B and had deviated from its past practice without adequate 
explanation in determini ng that the demand for raw olives is "substantially dependent " on the demand for 
table olives . The USCIT therefore remanded this aspect of the analysis to the USDOC  for further consideration . 
The USCIT upheld the USDOC 's finding under the second criteri on of Section  771B that the processing of raw 
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  Regarding the second factual circumstance , the USDOC found that the value for processing raw 
olives into subject merchandise "represents a limited value added to the raw commodity " and further 
found that "irrespective of the relationship between cost and value, the processing operation does 
not change the essential character of the olive ".336 Accordi ngly, t he USDOC stated that it was 
"attributing … the benefits received by olive growers … under Section  771B of the Act ".337 The USDOC 
affirmed its findings in the final determination .338 
7.3.2.2   Whether  the USDOC's  determination  of benefit  in the Spanish  ripe olive 
investigation  complied  with the applicable  legal  standard  
7.175.   As reflected in its preliminary and final determination s, the USDOC made its  determination 
of pass -through for three mandatory respondents  Agro Sevilla, Ángel  Camacho and Aceitunas 
Guadalquivir  based on an evaluation of the two factual circumstances set out in Section  771B, 
without consideration of any other potentially relevant information relating to the market or the 
competitive conditions affecting the inve stigated product . We have found above that Section  771B 
is inconsistent as such with Article  VI:3 of the  GATT  1994 and Article  10 of the SCM  Agreement, 
because it directs the USDOC to presume  the existence of pass -through between raw and processed 
agricult ural products, whenever the two factual circumstances it prescribes are established , and to 
avoid  consideration of additional factors that may potentially  be relevant . We found this inconsistent 
with the obligations in Article  VI:3 and Article  10 to establ ish the existence and extent of indirect 
subsidization ( i.e. pass-through ) taking into account facts and circumstances  that are relevant to 
that exercise . As we already explained , this follows from the operation of  the law itself.  In view of 
this, we find the USDOC's  determination in the ripe olives investigation to be inconsistent with 
Article  VI:3 and Article  10 for the same reasons that Section  771B is inconsistent "as such" with 
those same provisions.  
7.3.2.3   Conclusion  
7.176.   We conclude, for the reasons set forth above, that through the application of Section  771B 
of the Tariff Act of 1930 in the Spanish ripe olives investigation the United  States acted inconsistently 
with its obligations under Article  VI:3 of the  GATT  1994 and Article  10 of the SCM  Agreement to 
establish the existence and extent of indirect subsidization ( i.e. pass-through ) taking into account 
all relevant facts and circumstances . 
7.177.   As we noted above in respect of the European  Union's  "as such " claims, the European  Union 
also raises c laims under Articles  19.1, 19.3, 19.4, and 32.1 of the SCM  Agreement concerning the 
USDOC's  determination of benefit in the Spanish ripe olive s investigation. T he factual basis for each 
of these claims  appears  to be the same as the basis for the European  Union's  claims under 
Article  VI:3 of the  GATT  1994 and Article  10 of the SCM  Agreement. In light of this, we do not 
consider it necessary to make additional findings about whether the same factual circumstances give 
rise to violations of other provisions co ntained in the SCM  Agreement and therefore decline  to make 
further findings under Articles  19.1, 19.3, 19.4, and 32.1 of the SCM  Agreement . 
7.4  The USITC's  affirmative final injury determination  
7.178.   In this section we  will address the European  Union's  challenge to  the USITC's  affirmative 
final injury determination concerning dumped and subsidized ripe olives from Spain 
(Injury  Determination).339 The European  Union  claims  that the Injury Determination was 
 
olives into ripe olives adds only limited value . (Asociaci ón de Exportadores e Industriales de Mesa et al. 
v. United  States, (Exhibit  EU-50), pp. 18-40). On 29  May 2020, the USDOC issued a remand redeter mination 
reaffirming its initial findings. (Remand Redetermination, (Exhibit  EU-80), p.  24). 
336 PIDM, (Exhibit  EU-1), p.  16; FIDM, (Exhibit  EU-2), pp.  22-24. The USDOC observed the record 
evidence showing a 3% value for processing the raw input. (PIDM, (Exh ibit EU-1), p.  16). 
337 Agro Sevilla preliminary determination , (Exhibit  EU-37), p.  2; Ángel Camacho preliminary 
determination , (Exhibit  EU-38), p.  2; and Aceitunas Guadalquivir preliminary determination , (Exhibit  EU-36), p.  2. 
No changes occurred in the final determinations. (Agro Sevilla final determination, (Exhibit  EU-39); Ángel 
Camacho final determination , (Exhibit  EU-40); and Aceitunas Guadalquivir final determination, (Exhibit  EU-41)). 
338 FIDM, (Exhibit  EU-2), p.  26. 
339 Injury Determination, (Exhibit  EU-5). See also  Notice of determinations , (Exhibit  EU-10); and 
Preliminary determination  on injury , (Exhibit  EU-34). WT/DS577/R  
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  inconsistent with  Articles  3.1, 3.2, 3.4, and 3. 5 of the A nti-Dumping  Agreement, and  Articles  15.1, 
15.2, 15.4, and 15. 5 of the SCM  Agreement .340 
7.179.   This section  will first explain the rationale of our decision to deny the United  States'  request  
for a preliminary ruling that  the European  Union's  claims under Article  3.4 of the 
Anti-Dumping  Agreement  and Article  15.4 of the SCM  Agreement  are outside the Panel 's terms of 
reference.341 We will then address t he European  Union's  request that the Panel ma ke adverse 
inferences concerning the United  States'  failure to provide certain information requested by the 
Panel .342 
7.180.   Thereafter, we will review the European  Union's  allegation that the consideration of 
customer groups in the USITC's  volume and price effects analyses constituted a "segmented 
analysis"  of the ripe olive market  that was inconsistent with Articles  3.1 and 3. 2 of the 
Anti-Dumping  Agreement and Articles  15.1 and 15. 2 of the SCM  Agreement .343 We will then consider 
the European  Union's  specific challenges to the USITC 's analyses  of volume, pri ce effects , impact, 
and causation. The European  Union alleges each of these component parts of the injury investigation 
was inconsistent with  relevant provisions of Article  3 of the Anti-Dumping  Agreement  and Article  15 
of the SCM  Agreement .344 Finally, we will address certain consequential arguments made by the 
European  Union.345 
7.181.   We note that the European  Union  alleges that each of its arguments establish es a violation 
of both Article  3 of the Anti-Dumping  Agreement  and Article  15 of the SCM  Agreement . As the 
terminology and structure of the relevant provisions of Article  3 of the Anti-Dumping  Agreement  and 
Article  15 of the SCM  Agreement  are substantially similar, we understand these to contain the same 
substantive obligations for the purpose of the European  Union's  claims.346 This is consistent with the 
approach the parties  have adopted in presenting their positions in this dispute .347 
7.4.1   The United  States'  request for a preliminary ruling that claims under Article  15.4 of 
the SCM  Agreement and Article  3.4 of the  Anti-Dumping  Agreement are outside the 
Panel's  terms of reference  
7.182.   In its first written submission the United  States requested the Panel to preliminarily rule that 
the European  Union's  claims under Article  15.4 of the SCM  Agreement and Article  3.4 of the 
Anti-Dumping  Agreement are outside the Panel's  terms of reference, arguing that neither claim was 
 
340 European  Union's  panel request, p.  2; first written submission, sections  VI-VII; and  second written  
submission, sections  IV-V. 
341 See Annex  A-5. See also United  States'  first written submission, paras.  19-27. 
342 European  Union's 25  February  2021 comments on United States' 4  February  2021 letter , paras.  5-6 
and 13. See also European  Union's  second written submission , para. 86. 
343 European  Union's  first written submission , paras.  466-493 and 532-539; second written submission , 
paras.  101-124 and 153. 
344 European  Union's  first written submission, sections  VII(B)(2 -4), VII(C)(2 -3), and VII(D -E); second 
written submission, sections  V(B)(2 -4), V(C)(2 -3), and V(D -E). 
345 In relation to the USITC 's volume analysis, see European  Union's  first written submission, 
paras.  493, 512, 518, 560, 564 -565, 600, and 610. In relation to the USITC 's price effects analysis, see 
European  Union's  first written submission, paras.  539, 551, 557, 560, 564 -565, 600, and 610. 
346 We agree with the observation by the Appellate  Body in US – Offset Act (Byrd Amendment ) that, 
with respect to provisions of the A nti-Dumping  Agreement  and the SCM Agreement  with identical terminology 
and structure, there is a strong interpretive presumption that the provisions set out the same substantive 
obligations. (Appellate  Body Report, US – Offset Act (Byrd Amendment) , para. 268). The European  Union  has 
claimed paralle l violations of Articles  3.1, 3.2, 3.4, and 3. 5 of the A nti-Dumping  Agreement  and Articles  15.1, 
15.2, 15.4, and 15. 5 of the SCM  Agreement . Articles  3.1, 3.2, and 3.5 of the Anti -Dumping  Agreement and 
Articles  15.1, 15.2, and 15.5 of the SCM  Agreement are substantially identical except that those under the 
Anti-Dumping  Agreement concern dumped imports while th ose under the SCM  Agreement concern subsidized 
imports. Article  3.4 of the Anti-Dumping  Agreement  and Article  15.4 of the SCM  Agreement  also contain 
certain differences , however these are not significant for the issues raised by the European  Union . On this 
basis, unless otherwise indicated , we treat the obligations contained in Articles  3.1, 3.2, 3.4, and 3.5  of the 
Anti-Dumping  Agreement  as the same as  those contained in  Articles  15.1, 15.2, 15.4, and 15. 5 of the 
SCM Agreement.  
347 See, e.g.  European  Union's  first written submission, para.  436; and United  States'  first written 
submission, paras.  168-171. WT/DS 577/R  
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  identified in the European  Union's  consultations request or panel request.348 This request was based 
on the argument that the  European  Union raised a series of arguments in its first written submission 
contending  that the USITC's  injury determination is inconsistent with both Article  15.4 and 
Article  3.4,349 even though t hese provisions are not explicitly mentioned in either the 
European  Union's  request for consultations350 or panel request.351 The European  Union's  panel 
request contains the following language in relation to the USITC's  injury determination:  
The EU  is concerned that [the challenged] measures appear to be inconsisten t with:  
Article  VI:3 of the  GATT  1994, and Articles  15.1, 15.2 and 15.5 of the 
SCM Agreement, as a consequence of one or both of the preceding [bases] 
and because, in any event, the [US]ITC did not properly factor into the 
determination of injury the evolu tion in the volume of subsidized imports, 
or the effect of the subsidised imports on prices, and did not demonstrate 
the required causal relationship between subsidized imports and injury to 
the domestic industry, also taking into account non -attribution f actors. The 
injury determination is not based on positive evidence and does not involve 
an objective examination of the volume of the subsidized imports and their 
effects on prices, and the consequent impact on the domestic producers. 
Moreover, in the abse nce of relevant information, which was redacted from 
the report of the [US]ITC, the US  did not disclose all relevant information 
as required under Article  22.5 of the SCM  Agreement, including during the 
consultations. For the same reasons, the dumping meas ures appear to be 
inconsistent with Articles  VI:1 and VI:2 of the  GATT  1994, and Articles  3.1, 
3.2 and 3.5, and Article  12.2.2 of the Anti -Dumping  Agreement.352 
7.183.   Thus, with respect to claims raised under Article  15 of the SCM  Agreement and Article  3 of 
the Anti -Dumping  Agreement, the European  Union's  panel request explicitly mentions Articles  15.1, 
15.2, and 15.5 and Articles  3.1, 3.2, and 3.5, but does not mention Article  15.4 or Article  3.4.353 
7.184.   The United  States argues that the European  Union's  panel re quest identifies the specific 
aspects of the USITC's  analysis that are alleged to be inconsistent. According to the United  States, 
these aspects are "specifically that 't he [USITC] did not properly factor into the determination of 
injury the evolution in t he volume of subsidized imports, or the effect of the subsidised [ sic] imports 
on prices, and did not demonstrate the required causal relationship between subsidized imports and 
injury to the domestic industry, also taking into account non -attribution fact ors.'"354 The 
USITC's injury determination in respect of dumping is alleged to be inconsistent for the same 
reasons.355 
7.185.   The United  States argues, however, that the European  Union's  panel request does not 
identify a claim under either Article  15.4 of the SCM  Agreement or Article  3.4 of the 
Anti-Dumping  Agreement, and further does not raise any arguments with respect to the economic 
factors to be considered during an examination of the impact of dumped/subsidized imports on the 
domestic industry, i.e.  those factors contained in Article  15.4 and Article  3.4. Thus, the United  States 
considers that the European  Union's  legal claims with respect to injury are limited to its assertion 
 
348 United States'  first written submission , section II.  In its first written submission, the European  Union 
advances a number of claims under Article  15.4 and Article  3.4 in relation to the USITC's  volume analysis and 
price effects findings, as well as an alleged failure by the USITC to examine the impact of the dumped and 
subsidized imports on the domestic industry as a whole. We understand that the United  States'  preliminary 
ruling request concerns all claims that are alleged in connection with Article  15.4 and Article  3.4. 
349 See, e.g.  European  Union's first written submission, paras.  558-596. 
350 European  Union's  consultation request , p. 2. 
351 European  Union's  panel request , p. 2. 
352 European  Union's  panel request , p. 2. 
353 The European  Union's  request for consultation similarly mentions claims in respe ct of Articles  15.1, 
15.2, and 15.5 and Articles  3.1, 3.2, and 3.5, but does not explicitly mention Article  15.4 or Article  3.4. 
(European  Union's  consultation request , p. 2). 
354 United  States'  first written submission, para.  24 (quoting European  Union's  panel request , p. 2). 
355 United  States'  first written submission, para.  24. WT/DS577/R  
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  set out in its request for the establishment of a panel, to the exclusion of claims under Article  15.4 
and Article  3.4.356 
7.186.   The European  Union acknowledges that its panel request does not specify either Article  15.4 
or Article  3.4, and that normally, compliance with Article  6.2 of the DSU requires that only the 
specific provisions  mentioned in the panel request may fall within the panel's  terms of reference. 
Notwithstanding  that, the European  Union argues that the circumstances permit validly including 
claims in connection with Article  15.4 and Article  3.4 within the panel's  terms of reference , and that 
this is consistent with the approach followed by prior panels . As its main contention, the 
European  Union argues that the narrative language of its panel request clearly states that the 
European  Union takes issue with the fact that t he USITC did not carry out an objective examination 
of the "consequent impact" on the domestic producers. According to the European  Union, the 
reference to the examination of impact logically cannot constitute a stand -alone claim under 
Article  15.1 or Arti cle 3.1, but necessarily presupposes a claim under Article  15.4 and Article  3.4 
because those provisions speak to  the examination of impact.357 This, says the European  Union,  is 
due not only  to the fact that the term "impact" appears in Article  15.1 and Art icle 3.1, as well as in 
Article  15.4 and Article  3.4, but also because Article  15.1 and Article  3.1 provide " overarching 
general guidance"358, while Article  15.4 and Article  3.4 contain the "specific guidance" concerning 
the impact examination.359 
7.187.   The Europe an Union rejects the United  States'  contention that the lack of a reference in the 
narrative of its panel request to the USITC's  consideration of the economic factors during its 
examination of impact means that the European  Union's  claims should be limited . In this respect, 
the European  Union argues that there is no requirement in Article  6.2 of the DSU to set out 
arguments in a panel request. In any event, the European  Union maintains that its Article  15.4 and 
Article  3.4 claims are not directed at the USI TC's consideration of the economic factors but instead 
challenge "the overall impact analysis" carried out by the USITC.360 
7.188.   Finally, the European  Union argues that its Article  15.4 and Article  3.4 claims rely on "the 
same legal reasoning" that form the basi s of its claims under Article  15.2 and Article  3.2, and 
therefore the United  States would not be prejudiced by the inclusion of the 
European  Union's  Article  15.4 and Article  3.4 claims.361 
7.189.   We recall that a panel's  terms of reference are defined by Articles  6.2 and 7.1 of the DSU. 
Pursuant to Article  7.1, a panel is "[t]o examine … the matter referred to the DSB" by the 
complaining party's  panel request and "to make such findings as will assist the DSB in making the 
recommendations or in giving the rulings pr ovided for" in the covered agreement(s)  related to the 
complaining party's  claims. Article  6.2 of the DSU states as relevant:  
The request for the establishment of a panel shall be made in writing. It shall indicate 
whether consultations were held, identify  the specific measures at issue and provide a 
brief summary of the legal basis of the complaint sufficient to present the problem 
clearly.  
7.190.   We share the views of past panel and Appellate  Body reports  that the terms of Article  6.2 
establish that a complainan t must satisfy two key requirements in its panel request, namely, the 
 
356 United  States'  first written submission, para.  25. 
357 European  Union's  response to the United States'  preliminary ruling request , para.  24. 
358 The European  Union does not consider relevant the fact that its panel request excludes a general 
reference to either Article  15 or Article  3 under the view that Article  15.1 and Article  3.1, respectively, 
constitute overarching provisions comparable to a reference to Article  15 or Ar ticle 3. 
(European  Union's  response to the United States'  preliminary ruling request , para.  18). 
359 European  Union's  response to the United States'  preliminary ruling request, para.  24 (referring to 
Panel Report, Egypt – Steel Rebar , para.  7.102). The Europ ean Union also argues that there is a further "close 
relationship and interlink" between Articles  15.5 and 15.4, and Articles  3.5 and 3.4, as evident from language 
in Article  15.5 and Article  3.5 (which are identified in its panel request)  requiring an inv estigating authority to 
demonstrate that subsidized/dumped imports are, "through the effects of subsidies/dumping as set forth in 
paragraphs  2 and 4", causing injury. The European  Union argues that this provides further support that its 
Article  15.4 and Ar ticle 3.4 claims fall within the Panel's  terms of reference . (European  Union's  response to the 
United States'  preliminary ruling request, para.  19). 
360 European  Union's  response to the United States'  preliminary ruling request, para.  29. 
361 European  Union's  response to the United States'  preliminary ruling request, para.  27. WT/DS 577/R  
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  "identification of the specific measures at issue ", and "the provision of a brief summary of the legal 
basis of the complaint (or the claims)".362 The two elements together constitute the  "matter referred 
to the DSB" and form the basis for the Panel's  terms of reference under Article  7.1 of the DSU. These 
requirements are therefore central to the establishment of a panel's  jurisdiction.363 The panel 
request also serves a due process functio n, providing the respondent and third parties notice as to 
the nature of the complainant's  case364, enabling them to respond accordingly.365 We agree with the 
Appellate  Body that a panel must therefore determine whether the panel request, read as a whole 
and as it existed at the time of filing366, is "sufficiently clear" or "sufficiently precise" , based  on an 
"objective examination"  of the same .367 
7.191.   In order to "provide a brief summary of the legal basis of the complaint", the panel request 
must set out the clai ms so as to "present the problem clearly".368 We do not understand the parties 
to disagree with the view that a "claim" in this context is an allegation "that the respondent party 
has violated, or nullified or impaired the benefits arising from, an identifi ed provision of a 
particular  agreement"369; and that "arguments", by contrast, are statements put forth by a 
complaining party "to demonstrate that the responding party's  measure does indeed infringe upon 
the identified treaty provision".370 Whether such a brief summary is "sufficient to present the problem 
clearly"  is to be assessed on a case -by-case basis, keeping in mind the nature and scope of the 
provisions of the covered  agreements alleged to have been violated.371 
7.192.   Having carefully consi dered the parties'  arguments as well as the relevant language 
contained in the European  Union's  panel request, the Panel considers that, in citing Article  15.1 of 
the SCM  Agreement and Article  3.1 of the Anti -Dumping  Agreement, and in referring to certain 
language contained in Article  15.1 and Article  3.1 to make an "objective examination of … the 
consequent impact of [subsidized/dumped] imports on domestic producers of such products", the 
European  Union has provided a brief summary of the legal basis of th e complaint sufficient to meet 
the minimum requirements of Article  6.2 of the DSU, with respect to claims under Article  15.4 of the 
SCM Agreement and Article  3.4 of the Anti -Dumping  Agreement.  
7.193.   Article  15 of the SCM  Agreement and Article  3 of the Anti -Dumpi ng Agreement govern the 
determination of injury and causation in countervailing and anti -dumping proceedings in almost 
identical terms. There is undoubtedly a close normative relationship between the different 
subparagraphs  within each set of these provisi ons, which together operate to establish the relevant 
legal framework and disciplines for investigating authorities to follow when conducting an injury and 
causation analysis. Within this framework, we consider that Article  15.1 and Article  3.1 each functi on 
as an overarching provision that is directly linked with  the more detailed obligations set forth in 
 
362 Appellate  Body Report, US – Carbon Steel , para.  125. 
363 Appellate  Body Reports, EC and certain member States – Large Civil Aircraft , paras.  639-640 
(referring to Appellate  Body Reports, Guatemala – Cement I , paras.  72-73; US – Carbon Steel , para.  125; 
US – Continued Zeroing , para.  160; US – Zeroing (Japan)  (Article  21.5 – Japan) , para.  107; and Australia – 
Apples , para.  416); US – Countervailing and Anti –Dumping Measures (China) , para.  4.6; and Brazil – 
Desiccated Coconut , DSR 1997:1, p.  186. 
364 Appellate  Body Reports, Brazil – Desiccated Coconut , DSR 1997:1, p.  186; US – Carbon Steel , 
para. 126; and EC and certain member States – Large Civil Aircraft , para.  640. 
365 Appellate  Body Reports, Brazil – Desiccated Coconut , DSR 1997:1, p.  186; Chile – Price Band 
System , para.  164; US – Continued Zeroing , para.  161; and Thailand – H-Beams , para.  88. 
366 Appellate  Body Report, EC and certain member States – Large Civil Aircraft , para.  642. 
367 Appellate  Body Reports, EC – Bananas III , para.  142; EC and certain member States – Large Civil 
Aircraft , para.  641; US – Carbon Steel , para.  127; US – Continued Zeroing , para.  161; US – Countervailing and 
Anti-Dumping Measures (China) , para.  4.8; US – Oil Country Tubular Goods Sunset Reviews , para. 169; and 
US – Zeroing (Japan) (Article  21.5 – Japan) , para.  108. Parties'  subsequent submissions and statements, 
therefore, cannot "cure" defects in panel requests. (Appellate  Body Reports, China – Raw Material s, para.  220; 
EC – Bananas III , para.  143; EC and certain member States – Large Civil Aircraft , para.  787; US – Carbon 
Steel, para.  127; and US – Countervailing and Anti -Dumping Measures (China) , para.  4.9). 
368 Appellate  Body Report, EC – Selected Customs M atters , para.  167. 
369 Appellate  Body Report, Korea – Dairy , para.  139. 
370 Appellate  Body Report, Korea – Dairy , para.  139. A panel request need not, however, include 
arguments seeking "to  demonstrate that the responding party's  measure does indeed infringe u pon the 
identified treaty provision". A party's  arguments may be presented and clarified over the course of the 
proceeding. (Appellate  Body Report, Korea – Dairy , para.  139 (referring to Appellate  Body Reports, 
EC – Bananas  III, para.  141; India – Patents (US), para.  88; and EC – Hormones , para.  156)).  
371 Appellate  Body Report, US – Countervailing Measures (China) , para.  4.9. WT/DS577/R  
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  provisions such as Article  15.4 and Article  3.4372, and the inquiries foreseen under the 
subparagraphs  that follow serve as elements of a single, overall analysis addressing the question of 
whether subsidized or dumped imports are causing injury.373 In light of this, there is a distinct 
possibility that a claim under Article  3.1 and Article  15.1 may need to be resolved by assessing 
compliance with a more spe cific provision, such as Article  15.4 and Article  3.4, in respect of 
assessing the WTO -consistency of an investigating authority's  examination of impact. Indeed, in 
prior disputes, panels have shared this view, finding that a claim of inconsistency with Ar ticle 15.1 
or Article  3.1 will not normally be made or resolved independently of other provisions of Article  15 
or Article  3, respectively.374 We therefore consider that by referring to both Article  15.1 and 
Article  3.1 and stating that the Injury  Determina tion "does not involve an objective examination 
of … the consequent impact on the domestic producers "375, the European  Union's  panel request 
signals to the United States  the likelihood that the European  Union intended to pursue a claim in 
respect of Article  15.4 and Article  3.4, and that compliance with those articles was necessarily 
concomitant with the claims under Article  15.1 and Article  3.1 respectively, as specifically adverted 
to in the panel request by the use of the words "consequent impact ".376 
7.194.   We further disagree with the United  States that the European  Union's  panel request should 
be understood as limiting the European  Union's  complaint to the Injury  Determination in respect of 
the volume of subsidized imports or the effect of the subsidized/dumped  imports on prices and the 
assessment of causation.377 As we have noted, while flagging concerns with these aspects of the 
USITC's  Injury D etermination, the panel request also states that the Injury  Determination "does not 
involve an objective examination of … the consequent impact on the domestic producers" . In making 
its argument the United  States fails to acknowledge this additional language in the 
European  Union's  panel request. We also disagree that the absence of any reference to economic 
factors to be considered during an examination of the impact of dumped/subsidized imports on the 
domestic industry precludes the possibility of addressing claims in relation to Article  15.4 and 
Article  3.4, as there may be other considerations relevant to the examination of impact that could 
form the basis for a claim under either provision.378 
7.195.   For the reasons set forth above, we therefore conclude that in citing Article  15.1 of the 
SCM Agreement and Article  3.1 of the Anti -Dumping  Agreement, and in referrin g to certain language 
contained in Article  15.1 and Article  3.1 to make an "objective examination of … the consequent 
impact of [subsidized/dumped] imports on domestic producers of such products ", the 
 
372 We note that the Appellate  Body made a similar observation in the context of Article  3 of the 
Anti-Dumping  Agreement. (Appellate  Body Report, US – Carbon Steel (India) , para.  4.580).  
373 Appellate  Body Reports, China – HP-SSST (Japan)  / China – HP-SSST (EU) , para.  5.141. See also 
Appellate  Body Reports, Korea – Pneumatic Valves (Japan) , para.  5.193; and Russia – Commercial Vehicles , 
para. 5.54. 
374 Panel Report, China – Cellulose Pulp , para.  7.13. See also Panel Report, Korea – Pneumatic Valves 
(Japan) , para.  7.33. Certain panels have found that Article  15.1 and Article  3.1 can be infringed independently 
of obligations in other subparagraphs  under Article  15 or Article  3. (Panel Reports, Morocco – Hot-Rolled Steel 
(Turkey) , paras.  7.146, 7.151, and 7.219 (findi ng that Article  3.1 can be violated independently when an 
erroneous act or omission, such as an erroneous finding that the domestic industry in question is 
unestablished, taints the overall injury analysis); Argentina – Poultry Anti -Dumping Duties , paras.  7.283 -7.286 
(finding a stand -alone violation of Article  3.1 of the Anti -Dumping  Agreement, and further determining that it 
did not have to examine the part of the same claim concerning Article  3.4); and EC – Countervailing Measures 
on DRAM Chips , fn 218 (s tating that an investigating authority may act inconsistently with Article  15.1 if it 
lacks positive evidence and has not examined the evidence before it objectively)).  
375 Emphasis added.  
376 We note in Thailand – H-Beams , the panel similarly found references  in the panel request to the 
language "positive evidence", "objective examination" and "enumerated factors such as import volume, price 
effects, and the consequent impact of such imports on the domestic industry", met the minimum requirements 
of Article  6.2 DSU with respect to the complainant's  claims under Articles  3.1, 3.2, and 3.4 of the 
Anti-Dumping  Agreement, even though the panel request did not explicitly list these specific provisions. The 
panel request referred to Article  3 of the Anti -Dumping  Agreement generally. (Panel Report, Thailand – 
H-Beams , para.  7.36;  see also Appellate  Body Report, Thailand – H-Beams , para.  90). 
377 United  States'  first written submission, para.  24 (referring to European  Union's  panel request, p.  2). 
378 For instance, in Moroc co – Hot-Rolled Steel (Turkey) , the panel concluded that the Turkish 
investigating authority acted inconsistently with Articles  3.1 and 3.4 of the Anti -Dumping  Agreement, inter alia , 
by disregarding the captive market in its injury analysis.  (Panel Report,  Morocco – Hot-Rolled Steel (Turkey) , 
paras.  7.223, 7.262, 7.278, and 7.288). In China – Cellulose Pulp , the panel found that Canada had failed to 
establish that China's  investigating authority's examination of the impact was inconsistent with Articles  3.1 and 
3.4 of the Anti -Dumping  Agreement, because it failed to objectively examine the domestic industry's  market 
share. (Panel Report, China – Cellulose Pulp , paras.  7.113, 7.126, and 7.138).  WT/DS 577/R  
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  European  Union has provided a brief summary of the lega l basis of the complaint sufficient to meet 
the minimum requirements of Article  6.2 of the DSU with respect to claims under Article  15.4 of the 
SCM Agreement and Article  3.4 of the Anti -Dumping  Agreement.  
7.4.2   The European  Union's  request that the Panel make ad verse inferences concerning 
the United  States ' failure to provide certain information requested by the Panel  
7.196.   Throughout these proceedings the Panel has had access to only the public version of the 
Injury Determination. This document redacts certain informa tion that was deemed confidential by 
the USITC in the investigation. In its first written submission, the European  Union indicated that it 
expected the United  States to provide it and the Panel with an unredacted version of the 
USITC's  determination  so tha t the Panel, the European  Union , and third parties, if they so request ed, 
would be  able to verify the factual basis upon which the United  States  determined, in particular, 
injury and causation in the underlying administrative proceedings .379 
7.197.   Following the f irst substantive meeting, the Panel requested the United  States to provide 
certain redacted information.380 The United  States informed the Panel that the requested information 
was subject to an administrative protecti ve order under domestic law that require d authorization 
from relevant parties to disclose.381 The United  States stated it was seeking such authorization.382 
The United  States did not ultimately provide the Panel with the requested information, but instead 
supplied several tables  depicting trends r elated to the requested data.383 The European  Union 
subsequently requested the Panel to draw adverse inferences from the United  States'  failure to 
provide the requested information.384 Notwithstanding  this, the European  Union maintains that the 
resolution of  its arguments does not depend on the Panel having access to the redacted 
information.385  
7.198.   Following the second substantive meeting, the Panel posed supplemental questions to the 
United  States  addressing certain issues affected by an absence of unredacted d ata.386 In response  
to these supplemental questions , the United  States made a number of factual clarifications.387 The 
European  Union was provided with an opportunity to comment on the United  States'  factual 
statements and did not challenge the ir accuracy.388 
7.199.   We recall that Article  13.1 of the DSU provides:  
Each panel shall have the right to seek information and technical advice from any 
individual or body which it deems appropriate. However, before a panel seeks such 
information or advice from any individual or body within the jurisdiction of a Member it 
shall inform the authorities of that Member. A Member should respond promptly and 
fully to any request by a panel for such information as the panel considers necessary 
 
379 European  Union's  first written submission, para.  424. 
380 29 October 2020 Panel question  No. 40 (requesting the unredacted version of Injury Determination, 
(Exhibit  EU-5), tables II -1, III-4, III-8, IV-2, IV-5, IV-6, IV-7, IV-8, and C -1). 
381 United  States'  12 November  2020 response to the Panel question  No. 40, paras.  82-84. 
382 United  States'  12 November  2020 response to the Panel question  No. 40, para. 84. 
383 United  States'  letter to the Panel dated  4 February  2021 (providing revised public versions of Injury 
Determination, (Exhibit  EU-5), table s IV-6, IV-7, IV-8, and C -1). 
384 European  Union's  25 February  2021 comments on United  States'  4 February  2021 letter, paras.  5-6 
and 13. See also European  Union's  13 April 2021 comments on the United  States'  26 March  2021 response s to 
Panel question  No. 2(h), para.  18, No. 3, para.  20, and No.  4, para.  23. 
385 European  Union's  25 February  2021 comments on United  States'  4 February  2021 letter , para. 4; see 
also European  Union's  second written submission, para.  85 (stating that "the EU  emphasizes that t he success 
of the EU's  claims and the resolution of this dispute does not hinge on the receipt of the BCI requested by the 
Panel "). 
386 5 March  2021 Panel questions.  
387 United  States'  26 March  2021 responses to Panel questions Nos.  1-4. 
388 European  Union's  13 April 2021 comments on the United  States' 26  March  2021 response to Panel 
questions. We note that the European  Union contested the United  States arguments in  response to questions 
Nos. 1, 2(a), 2(g) -(h), 3, and 4. The European  Union's  comment in relation t o the United  States'  responses to 
questions Nos.  2(b)-(f) was in each case that it had no observations, although noting that "[t] he fact that the 
EU has no observations does not signify agreement with the US 's statements ". We do not understand the 
European  Union to challenge the factual statements made by the United  States, however, although the 
European  Union clearly does in certain circumstances challenge the arguments made by the United  States on 
the basis of those factual statements.  WT/DS577/R  
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  and appropriate. Confidential information which is provided shall not be revealed 
without f ormal authorization from the individual, body, or authorities of the Member 
providing the information.  
7.200.   Article  13.1 of the DSU thus allows a Panel to request information "from any individual or 
body which it deems appropriate" and indicates that a "Member should respond promptly and fully 
to any request by a panel". We agree with prior panel and Appellate  Body reports that Article  13.1 
grants discretionary authority to panels to seek information from relevant sources.389 We further 
agree that as part of its objective assessment of the facts under Article  11 of the DSU a panel is 
entitled to draw adverse inferences from a party's  refusal to provide information.390 
7.201.   Taking into account the course of events described above, we decline to draw adverse 
inferences fr om the United  States'  failure to provide the requested redacted information in full. First, 
we note that the United  States clarified a number of factual issues in response to questions from the 
Panel following the second substantive meeting.391 The accuracy  of these factual statements has not 
been challenged by the European  Union, and the United  States'  clarifications are of assistance to us 
in resolving certain issues in dispute between the parties.392 Second, the European  Union has 
explained that additional  factual information is not necessary, in its view, to make out its claims in 
relation to the Injury Determination.393 For these reasons , we decline the European  Union's  request 
to draw adverse inferences from the United  States'  failure to provide the Panel  with the requested 
information.  
7.4.3   The USITC 's analysis of customer groups in its examination of volume and price 
effects under Articles  3.1 and 3.2 of the Anti -Dumping  Agreement and Articles  15.1 and 
15.2 of the SCM  Agreement  
7.202.   The European  Union  puts forward  two lines of argu ment challenging the USITC 's analysis of 
customer groups in its examination of volume and price effects . The  European  Union  first argues 
that the USITC 's examination of the volume and price effects of ripe olives from Spain was  based on 
a "segment ed analysis " of customer groups in the ripe olive market that was "arbitrary, meaningless 
and in contradiction to the USITC's  own determinations ".394 Second, the European  Union argues that 
the USITC's  consideration of customer groups was inappropri ate because an "authority cannot define 
the domestic industry in a non -segmented manner and then carry out an injury analysis on the basis 
of a segmented industry".395 The European  Union  thus claims that  the Injury  Determination was not 
based on an objective examination of positive evidence in violation of Articles  3.1 and 3.2  of the 
Anti-Dumping  Agreement  and Articles  15.1 and 15.2  of the SCM  Agreement .396 
7.203.   The United  States  argues that the USITC did not conduct a "segmented analys is", but rather 
based its injury analysis on data pertaining to the ripe olive market as a whole.397 In relation to the 
European  Union's  second argument, the United  States responds that prior WTO dispute settlement 
 
389 See, e.g.  Appella te Body Report, Argentina – Textiles and Apparel , para. 84. 
390 See, e.g.  Appellate  Body Report, US – Wheat Gluten , paras.  172-173. 
391 United  States'  26 March  2021 response to Panel questions; European  Union's  13 April 2021 
comments on the United  States'  26 March  2021 response to Panel questions.  
392 See discussion of these factual statements in paras.  7.267 -7.275  and fn 585 below. We note that in 
one instance there is a conflict between certain factual statements in the European  Union's  first written 
submission in the context of its arguments regarding causation, and the factual clarifications on that point 
made by the Unit ed States in its comments to the European  Union's  26 March  2021 reply to Panel questions on 
13 April 2021. As this statement was made in the United  States'  comments, the European  Union did not have 
an opportunity to respond. As discussed below, we do not c onsider that the relevant factual issue would affect 
our finding, and thus have not sought additional comments from the parties. (See discussion below, 
para. 7.315 ). 
393 European  Union's  second written submission, para.  85; 25 February  2021 comments on letter from 
United States of 4  February  2021, para.  4. 
394 European  Union's  first written submission, para.  465. 
395 European  Union's  second written submission, para.  102. See  also European  Union's  first written 
submission, paras.  497-502; and  second written submission, para.  162. 
396 European  Union's  first written submission , paras.  465, 492 -493, and 538-539. 
397 United  States'  first written submission, paras.  164-180 and 207 -208; second written submission , 
paras.  46-60. WT/DS 577/R  
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  reports that the European  Union relies upo n to support its claims clearly allow for a consideration of 
market segments.398 
7.204.   We examine the merits of the European  Union's  claims in the sections  that follow.  
7.4.3.1   Whether the USITC conducted a "segmented analysis" of volume and price effects 
that was incons istent  with Articles  3.1 and 3.2 of the Anti -Dumping  Agreement and 
Articles  15.1 and 15.2 of the SCM  Agreement  
7.205.   The European  Union  argues that the USITC 's examination of the volume and price effects of 
ripe olives from Spain was  based on a "segment ed analys is" of customer groups in the ripe olive 
market that was "arbitrary, meaningless and in contradiction to the USITC 's own determinations".399 
The European  Union  maintains that "only the domestic industry as a whole "400 was relevant  for the 
USITC 's analysis be cause ripe olives are a "homogenous  product"401 purchased by " all customer 
groups  interchangeably" .402 The European  Union asserts that the USITC's  examination of volume 
and price effects was based on this allegedly arbitrary "segmentation" and was thus not an objective 
examination based on positive evidence in violation of Articles  3.1 and 3.2 of the 
Anti-Dumping  Agreement and Articles  15.1 and 15.2 of the SCM  Agreement.403 
7.206.   The United  States  responds that the USITC did not conduct a "segmented analysis", but 
rather based its injury analysis on data pertaining to the ripe olive market as a whole.404 The 
United  States  maintains  that the USITC 's examination of trends concerning retailers, distributors , 
and institutional/food processors was objective and based on positive evidence.405 
7.207.   In the Injury Determination  the USITC determined  that ripe olives were gene rally sold to 
purchasers categorized as retailers, distributors, and institutional/food processors.406 The USITC 
described t hese customer groups as "channels of distribution".407 The USITC prepared d ata 
concerning sales and market share of domestic, Spanish , and other imported ripe olives based on  
sectors defined by each customer group.408 The USITC then examined t rends relating to these 
customer groups, particularly retailers, in its injury analysis.  
7.208.   In the analysis that follows w e will refer to "customer gro ups" or "channels of distribution" 
interchangeably as indicating the set of purchasers categorized by the USITC as retailers, 
distributors, and institutional/food processors ( e.g. the "retail customer group" or the "retail channel 
 
398 United  States'  first written submission, para.  173 (referring to Appellate  Body Report, US – 
Hot-Rolled Steel , para. 204; and European  Union's  first written submission, para.  499). 
399 European  Union's  first written submission, para.  465. See also European  Union's  first written 
submission , paras.  466-493 and 532-539; and second written submission , paras.  101-124 and 153. 
The European  Union  variousl y alleges the USITC 's examination of customer groups was "arbitrary" 
(e.g. European  Union's  first written submission , paras.  465, 467, 469, and 492), "meaningless" 
(e.g. European  Union's  first written submission, paras.  465, 467, 472, and 476), "in contrad iction to the 
USITC 's own determinations" ( e.g. European  Union's  first written submission, paras.  465 and 492; second 
writte n submission, paras.  104 and 106), "artificial" ( e.g. European  Union's  first written submission , paras.  465 
and 476), "makes no sense" ( e.g. European  Union's  first written submission, paras.  467 and 472), 
"superfluous" ( e.g. European  Union's  first written submission , para. 472), and "not supported by evidence on 
the record" ( European  Union's  second written submission, para. 104; se e also  ibid. para. 106). We understand 
these various allegations are different ways of articulating the European  Union's  argument that the 
USITC 's consideration of customer groups was not based on an objective examination of positive evidence. We 
therefore  do not consider it necessary to respond to each of these allegations individually, but rather addre ss 
them collect ively by responding to the substantive arguments put forward by the European  Union . 
400 European  Union's  first written submission, para.  483. ( emphasis  omitted)  
401 European  Union's  first written submission, para.  466. 
402 European  Union's  first written submission, para.  468 (emphasis  omitted); see also  ibid. paras.  462, 
474, and 536.  
403 European  Union's  first written submission, paras.  492 and 538.  
404 United  States'  second written submission , paras.  46-48. 
405 United  States'  first written submission, paras.  166-167 and 189. See also United  States'  first written 
submission, paras.  164-180; and second written submission, paras.  46-54. 
406 Injury Determinatio n, (Exhibit  EU-5), e.g. pp.  14-15. 
407 Injury Determination, (Exhibit  EU-5), e.g. pp.  II-1-3 and table II -1. 
408 Injury Determination, (Exhibit  EU-5), e.g. tables II -1 and IV -6-8. WT/DS577/R  
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  of distribution"). We wil l also refer to "sector" as the sub section  of the whole market defined by sales 
to a particular customer group ( e.g. the "retail sector").  
7.209.   Before addressing the European  Union's  substantive complaint, we briefly review Articles  3.1 
and 3.2 of the Anti -Dump ing Agreement, and Articles  15.1 and 15.2 of the SCM  Agreement. 
Article  3.1 and Article  15.1 provide that : 
A determination of injury for purposes of Article  VI of GATT  1994 shall be based on 
positive evidence and involve an objective examination of both (a ) the volume of the 
[dumped  or subsidized]  imports and the effect of the [dumped  or subsidized]  imports 
on prices in the domestic market for like products, and (b ) the consequent impact of 
these imports on domestic producers of such products.  
In our view "positive evidence" must be evidence that is affirmative, objective, and capable of 
credibly supporting the injury determination.409 To be "objective", an investigating 
authority 's examination must be impartial and supported by reasoning that is  coherent and internally 
consistent.410 We consider  the obligation to conduct an objective examination based on positive 
evidence in Article  3.1 and Article  15.1 to be an overarching requirement that applies to every aspect 
of an injury determination.  
7.210.   Article 3.2 and Article  15.2 set forth more detailed requirements relating to the examination 
of the volume of the dumped or subsidized imports and their effect on prices in the domestic market 
of the like product.  Article  3.2 and Article  15.2 provide:  
With reg ard to the volume of the [dumped  or subsidized] imports, the investigating 
authorities shall consider whether there has been a significant increase in [dumped  or 
subsidized] imports, either in absolute terms or relative to production or consumption 
in the importing Member.  With regard to the effect of the [dumped  or subsidized] 
imports on prices, the investigating authorities shall consider whether there has been a 
significant price undercutting by the [dumped  or subsidized] imports as compared with 
the pri ce of a like product of the importing Member, or whether the effect of such 
imports is otherwise to depress prices to a significant degree  or prevent price increases, 
which otherwise would have occurred, to a significant degree. No one or several of these 
factors can necessarily give decisive guidance.  
We observe that Article  3 and Article  15 do not direct investigating authorities to address parts, 
sections, or seg ments of a market in a particular way when undertaking an injury investigation. 
In our view, the absence of guidance in this respect indicates that an investigating authority has 
discretion to examine parts, sections,  or segments of a market as the investigating  authority deems 
appropriate . An analysis of parts, sections,  or segments of a market must, nonetheless, be based 
on an objective examination of positive evidence.  
7.211.   We note, further, that t he term "segmented analysis" is not contained in Articles  3.1 and 
3.2, or Articles  15.1 and 15.2, or any other provision of the Anti -Dumping  Agreem ent or the 
SCM Agreement . In our view the rights and obligations contained in Articles  3.1 and 3.2,  and 
Articles  15.1 and 15.2,  thus apply equally to a determination of injury that is labelled as involving a 
"segmented analysis", as to one that is not so c haracterized.411 We acknowledge that there may be 
 
409 We base this understanding on the ordinary meaning of "positive", which includes "admitting no 
question; stated, express, definite, precise; emphatic" and "providing support for a particular hypothesis, 
esp[ecially] one concerning the presence or existence of something".  (Oxford Dictionaries online, definition of 
"positive " https://www.oed.com/view/Entry/148318?rskey=3r7q5h&result=1&isAdvanced=false#eid  (accessed 
7 July 2021), adj., meaning A.I.2  and A.II.4.c).  
410 We base this u nderstanding on the ordinary meaning of "objective", which includes "not influenced 
by personal feelings or opinions in considering and representing facts; impartial, detached". (Oxford 
Dictionaries online, definition of "objective" 
https://www.oed.com/view/Entry/129634?redirectedFrom=objective#eid  (accessed 7 July 2021), adj., 
meaning 8.a ). 
411 In support of its argument the European  Union refers to the Appellate  Body Report US – Hot-Rolled 
Steel. (European  Union's  first written submission, paras.  450-454). This report discusses circumstances under 
the Anti -Dumping  Agreement in which investigati ng authorities may "examine a domestic industry by part, 
sector or segment ". (Appellate  Body Report, US – Hot-Rolled Steel , para. 204). The Appellate  Body does not 
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  determinations that would be usefully described as involving a "segmented analysis", and that such 
a description could assist a panel's  assessment of the consistency or otherwise of that determination 
with A rticle 3 and Article  15.412 It is our understanding that the European  Union describes the Injury 
Determination as involving a "segmented analysis" because the USITC did not just examine trends 
at the level of the market as a whole, but also examined trends in relation to certain customer 
groups. However, in the circumstances of the current dispute, we do not consider it is useful to 
describe the Injury Determination as a "segmented analysis"  merely because the USITC analysed 
trends in different customer grou ps. We consequently do not adopt the 
European  Union's  characterization of the Injury Determination as a "segmented analysis"  for the 
purpose of reviewing the merits of its claims .413 We will instead focus our examination  in this 
section  on the European  Union's substantive complaint that the USITC 's examination of customer 
groups was, in the context of the ripe olives market, not based on an objective examination of 
positive evidence.  
7.212.   Turning to the European  Union's  substantive argument, in our view t he custo mer groups 
examined by the USITC were not , as the European  Union alleges,  "meaningless"414 or "arbitrary ".415 
Rather, the customer groups were based on unique purchasers  and distinct products , and with  each 
customer group holding different levels of importan ce for the domestic  industry  and importers of 
Spanish ripe olives.  The USITC identified that ripe olives were generally sold to retailers, distributors, 
and institutional/food processors.416 These customer groups were composed of unique purchasers.417 
For example, the USITC identified that retailers included firms such as Walmart and Kroger, while 
institutional/food processors included restaurants, schools , and commercial food processors.418 The 
USITC  also collected pricing data on institutional and retail products with distinct packaging 
characteristics.419 For example, the drained weight of institutional pricing products per can or pouch 
was between 33 -55 ounces, substantially larger than the drained weight of retail pricing products of 
between 2.25 -2.26 ounces.420 Furthermore, it is clear that the three customer groups had d ifferent 
levels of importance  for the domestic  industry  and importers of Spanish ripe olive s. In relation to 
Spanish ripe olives, the USITC noted that as a "share of total reported shipments between 2015 and 
2017, U.S. importers ' U.S. commercial shipments of ripe olives from Spain ranged from 79.7 percent 
to 88.8 percent for distributors, 7.3 percent to 17.0 percent for retailers, and 3.3 percent to 
4.0 percent for institutional/food processors".421 In contrast, the USITC noted that "[d]omestically 
produced ripe olives were largely sold to retailers over the [period of investigation]".422 This evidence 
establishes that the customer groups identified by the USITC were not "arbitrary, meaningless and 
in contradiction to the USITC 's own determinations".423 Rather, there was a credible basis of facts 
for the construction of each customer grou p. We thus consider that the customer groups examined 
by the USITC were not arbitrary but based on positive evidence . 
7.213.   The European  Union also  allege s that the USITC failed to explain the relevance of the 
different customer groups in the sections  of the Injury Determination  titled "Demand Conditions ", 
"Supply Conditions ", and "Substitutability and Other Conditions ".424 However,  the Panel notes that  
each of these customer groups and their general purchasing patterns  are clearly identified in the 
 
indicate in this report that the term "segmented analysis " has a particular legal meaning un der the 
Anti-Dumping  Agreement. (Appellate  Body Report, US – Hot-Rolled Steel , paras.  193-206).  
412 We also do not consider the fact that the term "segmented analysis " has been used descriptively by 
a number of prior panels means that the term has any particular legal meaning under the 
Anti-Dumping  Agreement or SCM  Agreement . (See, e.g.  Panel Report, China – X-Ray Equipment , para. 7.187 ). 
413 The European  Union asserts th at "the USITC invents a so -called 'segmentation'  of the domestic 
industry along customer groups ". (European  Union's  first written submission, para.  460). The USITC does not, 
in fact, use this terminology in its report.  
414 European  Union's  first written subm ission, para.  467. 
415 European  Union's  first written submission, para.  467. 
416 Injury Determination, (Exhibit  EU-5), e.g. pp.  14-15. 
417 United  States'  second written submission, para.  83; 8  September  2020 response to Panel question 
No. III(a), para.  29. 
418 Injury Determination, (Exhibit  EU-5), p.  14. 
419 Injury Determination, (Exhibit  EU-5), pp.  19-20 and fn 112. 
420 Injury Determination, (Exhibit  EU-5), fn  112. 
421 Injury Determination, (Exhibit  EU-5), fns  68 and 105.  
422 Injury Determination, (Exhibit  EU-5), p.  14. 
423 European  Union's  first written submission, para.  465. 
424 European  Union's  first written submission , paras.  483-486 (referring to Injury Determination, 
(Exhibit  EU-5), pp.  15-17). WT/DS577/R  
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  section  of the Injury Determination  titled "Demand Conditions ".425 Furthermore, the 
USITC's  explanation made it re asonably clear that the customer groups were based on unique 
purchasers  and distinct products , and that each customer group held different levels of importance  
for the domestic  industry  and importers of Spanish ripe olives .426 We thus find that the USITC 
reasonably explained the relevance of the customer groups and reject the 
European  Union's  argument to the contrary as unpersuasive.  
7.214.   We are further  of the view that t he relative uniformity of ripe olives does not establish that 
the USITC 's examination of cust omer groups was not objective. The European  Union  contends that 
the examination of customer groups was not objective because ripe olives are a homogenous product 
purchased interchangeably by all customer groups.427 We note that the USITC found ripe olives t o 
be a relatively uniform product , concluding that despite differences in size and presentation, "all ripe 
olives within the scope were at least somewhat interchangeable, and were perceived to be the same 
product by market participants".428 Similarly, the U SITC found that domestically produced ripe olives 
and those from Spain had a "high degree of substitutability".429 Beyond observing these statements  
by the USITC, we do not consider it necessary to make findings as to the extent of substitutability 
and product differentiation in the ripe olives market.430 This is because our conclusion does not 
depend on the exact degree to which ripe olives are substitu table or differentiated. The 
European  Union's  argument is premised on the view tha t the USITC "could not 'segment ' the 
industry by distribution channel" because all ripe olives  are a homogenous product that  "compete 
with each other across the three distribution channels and hence across the entire industry".431 The 
European  Union argues on this basis that the examination of customer groups was not objective 
because "the only conceivable purpose of the USITC's  'segmentation'  was to artificially create a 
volume effect".432 The European  Union  does not, however, allege that the USITC selective ly collected 
data from particular customer groups  or that the three customer groups do not collectively reflect 
the whole market. On the contrary, the Injury Determination  makes clear that the USITC gathered 
data from domestic processors and importers on t heir commercial shipments across all 
three  customer groups.433 An objective examination of trends in these three customer groups would 
thus be consistent, in aggregate, with an examination of the whole market. We do not think that the 
"only conceivable purp ose" for an investigating authority to examine customer groups collectively 
accounting for the whole market would be to artificially construct volume changes and price effects. 
Rather, an objective investigating authority could reasonably choose to examine  trends within these 
customer groups  to ascertain whether there are any pertinent volume changes or price effects not 
apparent from the aggregate data.  Even if ripe olives were perfectly homogenous,  we do not consider 
that the USITC 's examination of custom er groups would establish by itself a lack of objectivity , as 
the three customer groups analysed by the USITC collectively account for the whole ripe olives 
market. We thus reject the European  Union's  argument that  the uniformity of ripe olives as a produc t 
establishes that the USITC's  analysis of customer groups was not based on an objective examination 
of positive evidence .  
7.215.   We note that o ur conclusion is consistent with the observations of the panel in Mexico – Corn 
Syrup  concerning an investigating  authority 's examination of market segments. The European  Union  
maintains that the panel 's findings in Mexico – Corn Syrup  imply that there must "be conditions of 
competition that are different per segment in order for the segmentation to serve as [a] valid  basis 
for the injury analysis".434 We do not agree with the European  Union's  interpretation of that report. 
The Mexico – Corn Syrup  dispute concerned anti -dumping duties imposed by Mexico against imports 
of high -fructose corn syrup from the United  States . In that case the Mexican investigating  authority 
defined the domestic like product as sugar, and the domestic industry as "manufacturers of cane  
 
425 Injury Determination, (Exhibit  EU-5), pp.  14-15. 
426 See para.  7.212  above.  
427 European  Union's  first written submission, paras.  466-468. 
428 Injury Determination, (Exhibit  EU-5), p.  7 (adopting the findings of the Preliminary determination  on 
injury , (Exhibit  EU-34), p.  8). 
429 Injury Determination, (Exhibit  EU-5), p.  17. 
430 United  States'  first written submission , para. 237; 8 September  2020 response to Panel question 
No. III(a) , para. 29; European  Union's  second written submission, para.  119; and 10  June 2020 response to 
Panel question No.  21, paras.  108 and 110.  
431 European  Union's  opening statement at the first meeting of the Panel, para.  98. 
432 European  Union's  first written sub mission, para.  469. 
433 United  States'  first written submission, para.  175 (referring to Injury Determination, (Exhibit  EU-5), 
tables II -1 and IV -5–IV-8). 
434 European  Union's  12 November  2020 response to Panel question No.  21, para.  161. WT/DS 577/R  
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  sugar ".435 The United  States  argued that the Mexican investigating  authority 's determination was 
inconsistent wi th various provisions of Article  3 of the Anti -Dumping  Agreement  because the 
investigating  authority focused solely on the industrial market for sugar.436 The panel found that the 
Mexican investigating  authority had "explicitly stated that it excluded from its consideration sugar 
sold in the household market, and limited its examination to sugar sold in the industrial market, 
despite the fact that it had determined that there was only one like product at issue, sugar, and one 
industry, cane sugar producers".437 As the industrial sector of the Mexican sugar market only 
accounted for 53% of total sugar consumption, the panel concluded that the Mexican investigating  
authority 's injury determination was not based on consideration of the domestic industry as a 
whole.438 The panel did not, however, make any findings that would support the 
European  Union's  claim that "segmentation" is only valid where conditions of competition differ 
between segments. On the contrary, the panel took pains to distinguish between the not ion of an 
injury determination made "on the basis of information regarding only production sold in one specific 
market sector, to the exclusion of the remainder of the domestic industry 's production", and an 
investigating  authority 's "consideration of fact ors relevant to the injury analysis on a sectoral basis, 
so as to gain a better understanding of the actual functioning of the domestic industry and its specific 
markets".439 As regards the examination of factors on a sectoral basis, the panel stated that t here 
"is certainly nothing in the [Anti -Dumping]  Agreement  which precludes a sectoral analysis of the 
industry and/or market" and that "in many cases, such an analysis can yield a better understanding 
of the effects of imports, and more thoroughly reasoned analysis and conclusion".440 The 
panel 's interpretation of  the Anti -Dumping  Agreement  in Mexico – Corn Syrup  is thus consistent with 
our view that an investigating  authority has discretion to examine parts, sections,  or segments of a 
market when undertaking an injury investigation as long as such examination is b ased on an 
objective examination of positive evidence.441 On this basis, it is our view that even if the conditions 
of competition did not differ between customer groups, this would not establish that the 
Injury  Determination was not objective , as the custo mer groups were based on positive evidence 
and collectively represented the whole market.442 
7.216.   The European  Union  maintains that the USITC  commissioner that dissented against the 
Injury Determination , Commissioner Broadbent,  "seems to share [the] view" that t he USITC could 
 
435 Panel Report, Mexico – Corn Syrup , para.  7.148.  
436 Panel Report, Mexico – Corn Syrup , paras.  7.143 -7.144.  
437 Panel Report, Mexico – Corn Syrup , para.  7.158.  
438 Panel Report, Mexico – Corn Syrup , para.  7.153.  
439 Panel Report, Mexico – Corn Syrup , para.  7.154.  
440 Panel Report, Mexico – Corn Syrup , para.  7.154.  
441 See para.  7.210  above.  
442 The European  Union also notes that the United  States submitted into evidence three examples of 
determinations by an investigating authority of the European  Union. (European  Union's  opening  statement  at 
the first meeting of the Panel , para. 100 (referring to Commission Implementing Regulation (EU) 2016/181  
(Exhibit  USA-33); and Commission Regulation (EC) 1611/2003 (Exhibit  USA-35))). The European  Union 
maintains that these determination s "vividly illustrate the difference between the WTO -consistent market 
segmentations carried out by the EU  and the WTO -inconsistent market 'segmentation'  carried out by the US  in 
the present case ". (European  Union's  opening s tatement  at the first meeting o f the Panel , para. 100 (referring 
to Commission Implementing Regulation (EU) 2016/181 (Exhibit USA -33); and Commission Regulation (EC) 
1611/2003 (Exhibit  USA-35))); see also European  Union's  second written submission, para.  110; and 
United  States'  8 Septem ber 2020 response to Panel question No.  III(a), para.  33. 
Exhibit  USA-33 contains Commission Regulation (EU)  2016/181 of 10  February  2016 imposing a 
provisional anti -dumping duty on imports of certain cold -rolled flat steel products originating in the 
People's Republic of China and the Russian Federation. This is subject to an ongoing dispute before a 
WTO panel. (Russia's  panel request, WT/DS521/2; Constitution note of the Panel,  WT/DS521/3).  
Exhibit  USA-34 contains Commission Regulation (EC)  896/2007 of 27  July 2007 imposing a provisional 
anti-dumping duty on imports of dihydromyrcenol originating in India. Exhibit  USA-35 contains Commission 
Regulation (EC)  1611/2003 of 15  September  2007 imposing a provisional anti -dumping duty on imports of 
certain stainle ss-steel cold -rolled flat products originating in the United  States. Neither of the measures 
contained in Exhibit  USA-34 or Exhibit  USA-35 have been the subject of dispute resolution at the WTO.  
We recall that our terms of reference are "to examine … the m atter referred to the DSB by the 
European  Union " in its request for the establishment of a panel. (Constitution note of the Panel, WT/DS577/4). 
The European  Union's  request for establishment of a panel contains reference to the Injury Determination but 
makes no mention of the measures by the European  Union contained in Exhibits  USA-33, USA -34, and USA -35. 
(European  Union's  panel request, p.  2). We have thus not been directed to examine the WTO consistency of 
these measures, which are unrelated to the Injury  Determination. We consequently decline to examine 
whether the European  Union's  investigating authority conducted "WTO-consistent market segmentations " in 
the measures contained in Exhibits  USA-33, USA -34, and USA -35. WT/DS577/R  
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  only meaningfully assess volume for the industry as a whole.443 The European  Union  support s this 
assertion with a block quote from the dissenting opinion.444 We recall that the European  Union , as 
the complainant, bears the onus of establishing that the Injury Determination (as represented by 
the decision of the majority of commissioners ) was not based on an objective examination of positive 
evidence.445 The mere fact that a dissenting view exists does not establish that the 
majority 's findings were not based on an objective examination of positive evidence. Rather, to 
demonstrate the merits of its claims , the European  Union  must explain what it is about the views  
expressed by  the dissent ing commissioner  that shows that a reasonable and objective investigating  
authority could not arrive at the same conclusion as the majority. There is nothing that has been 
brought to the Panel 's attention with respect to the dissent of that commissioner that w ould cause 
us to consider that the majority 's finding was not objective.  
7.217.   Therefore, based on the above, we reject the European  Union's  argument that the 
USITC 's examination of the volume and price effects of ripe olives from Spain was  based on a 
"segment ed analysis " of customer groups in the ripe olive market that was "arbitrary, meaningless 
and in contradiction to the USITC 's own determinations".446 
7.4.3.2   Whether the USITC's  definition of the domestic industry made it improper to 
consider customer groups  
7.218.   In the I njury Determination the USITC defined the domestic industry as "all U.S. processors 
of ripe olives".447 The European  Union argues that the USITC's  consideration of customer groups was 
inappropriate because an investigating  authority is "bound" by its definition of the domestic industry 
and "cannot define the domestic industry in a non -segmented manner and then carry out an injury 
analysis on the basis of a segmented industry".448 The European  Union bases this argument on the 
observation that Article  4.1 and footnote 9 of the Anti -Dumping  Agreement, as well as Article  16.1 
and footnote 45 of the SCM  Agreement, together require that a finding of injury be a determination 
that "domestic producers as a whole" or those domestic producers representing "a major  proportion 
of the total domestic production" have been injured.449 The European  Union argues that the reason 
for this is that a selective definition of the domestic industry would give rise to a material risk of 
distortion.450 The European  Union argues by a nalogy that "the same risk of distortion arises if the 
investigating authority first defines the domestic industry in a certain manner (here:  all ripe 
olives)  but subsequently carries out its injury and causation analysis only in a particular segment of 
that domestic industry (here:  the retail 'segment')".451 
7.219.   The United  States  considers  that the European  Union's  argument is inconsistent with the 
European  Union's  explicit agreement with the Appellate  Body's  statements in US – Hot-Rolled Steel  
concerning an investigating  authority 's analysis of market segments, in particular that "it may be 
 
443 European  Union's  first written submission, para.  475. 
444 European  Union's  first written submission, para.  475 (referring to Injury Determination, 
(Exhibit  EU-5), p.  28 (dissenting view)).  
445 See para.  7.7 above.  
446 European  Union's  first written submission, para.  465. 
447 Injury Determination, (Exhibit  EU-5), p.  10. 
448 European  Union's  second written submission, para.  102. See also European  Union's  first written 
submission,  paras.  497-502; and second written submission, para.  162. 
We note that the European  Union placed this argument in the section  VII(B)(2)  of its first written 
submission titled "The USITC's  analysis of volume effects is flawed because the USITC only analyse d volume 
effects for the retail 'segment'  of the domestic industry, not for the industry as a whole ". 
(European  Union's  first written submission, paras.  494-512). We address other arguments in 
section  VII(B)(2)  of the European  Union's  first written submiss ion below. (See paras.  7.236 -7.237  below). It is 
our view, however, that th e argument that an investigating authority is "bound " by its definition of the 
domestic industry is a stand -alone argument that is most logically addressed in this section  along with the 
European  Union's  argument that the USITC's  consideration of customer groups was not based on an objective 
examination of positive evidence.  
449 European  Union's  first written submission, para.  497. 
450 European  Union's  first written submission, para.  497 (referring to Appellate  Body Report, EC – 
Fasteners (China) , para. 419). 
451 European  Union's  first written submission, para.  497. WT/DS 577/R  
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  highly pertinent for investigating authorities to examine a domestic industry by part, sector or 
segment".452 
7.220.   The Anti -Dumping  Agreement and the SCM  Agreement contain guidanc e on the required 
scope of an injury determination. Footnote 9 of the Anti -Dumping  Agreement and footnote 45 of the 
SCM Agreement provide:  
Under this  Agreement  the term "injury " shall, unless otherwise specified, be taken to 
mean material injury to a domestic industry, threat of material injury to a domestic 
industry or material retardation of the establishment of such an industry and shall be 
interpreted in accordance with the p rovisions of this Article.  
7.221.   Article  4.1 of the Anti -Dumping  Agreement and Article  16.1 of the SCM  Agreement further 
provide that, subject to certain exceptions, the term "domestic industry" shall "be interpreted as 
referring to the domestic producers as a w hole of the like products or to those of them whose 
collective output of the products constitutes a major proportion of the total domestic production of 
those products ". 
7.222.   The term "injury" is thus defined as "material injury to a domestic industry, threat o f material 
injury to a domestic industry or material retardation of the establishment of such an industry".453 
The "domestic industry" is, in turn, defined as the "domestic producers as a whole of the like 
products" or those domestic producers "whose collec tive output of the products constitutes a major 
proportion of the total domestic production".454 A finding of injury must consequently be a 
determination that "domestic producers as a whole" or those domestic producers representing "a 
major proportion of th e total domestic production" have been injured.455 
7.223.   Our interpretation of these provisions is consistent with the European  Union's  assertion that 
an injury determination must concern the domestic industry as defined by the relevant investigating  
authority  in accordance with Article  4.1 and Article  16.1.456 We find  no support , however, for the 
different proposition espoused by the European  Union , which is  that an investigating  authority may 
only consider sections  of a market  while undertaking an injury analysis  when it has explicitly 
identified these sections  in the definition of the domestic industry . There is no reason that an 
investigating authority's  analysis of market segments  would necessarily imply that the final injury 
determination was not made with res pect to the domestic industry  as defined by the investigating 
authority. We therefore disagree that the USITC's  analysis of market segments posed  a risk of 
distortion. In particular, in this case the three customer groups collectively represented the whole 
market. Their analysis by the USITC would thus not necessarily leave parts of the domestic industry 
unexamined.457 We therefore do not see any ma terial risk of distortion arising from the fact that the 
USITC did not incorporate into its definition of the domestic industry reference to the various market 
segments it later analysed.  
7.224.   We consequently reject the European  Union's  claim that the USITC was  prevented from 
consider ing customer groups because such customer groups were not explicitly referred to in the 
definition of the domestic industry.  
 
452 United  States'  first written submission, paras.  173-174 (referring to Appellate  Body Report, US – 
Hot-Rolled Steel , para. 204; and European  Union's  first written submission, para.  499). 
453 Anti-Dumpin g Agreement,  fn 9 and SCM Agreement,  fn 45. 
454 Anti-Dumping  Agreement, Article  4.1 and SCM Agreement,  Article  16.1. 
455 See, e.g. Panel Report, Mexico – Corn Syrup , para.  7.147. (emphasis omitted)  
456 Our view is also consistent with prior reports. See, e.g. Panel Report, Mexico  – Corn Syrup , 
para. 7.147 (referring to Article  4.1 and fn  9 of the Anti -Dumping  Agreement and stating "[t]hese 
two provisions inescapably require the conclusion that the domes tic industry with respect to which injury is 
considered and determined must be the domestic industry defined in accordance with Article  4.1, that is, the 
domestic producers of the like product as a whole, or those of them whose collective output of the lik e product 
constitutes a major proportion of the domestic production of the like product "). 
457 See para.  7.214  above.  WT/DS577/R  
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  7.4.3.3   Conclusion on the USITC's  alleged "segmented analysis" of customer groups in 
its examination of volume and price effects under Articles  3.1 and 3.2 of the 
Anti-Dumping  Agreement and Articles  15.1 and 15.2 of the SCM  Agreement  
7.225.   We find that the European  Union has not demonstrated that the USITC 's analysis of 
customer groups was not based on an objective examinati on of positive evidence. We find further 
that the USITC 's consideration of customer groups was not improper in light of the definition given 
to the domestic industry. On this basis, we conclude that the European  Union  has not demonstrated  
that the USITC 's consideration of customer groups in its examination of volume and price effects 
was inconsistent with Articles  3.1 and 3.2 of the Anti -Dumping  Agreement  and Articles  15.1 and 
15.2 of the SCM  Agreement . 
7.4.4   The USITC 's examination of the volume of dumped and su bsidized ripe olives from 
Spain  
7.226.   In relation to the USITC 's volume analysis, the European  Union  raises two distinct lines of 
argument. First, the European  Union  argues the USITC failed to consider whether there had been a 
significant increase in dumped or subsidized imports  as required by the first sentence of Article  3.2 
and Article  15.2.458 Second, the European  Union  argues the USITC 's volume  analysis was not based 
on an objective examination of positive evidence.459 The European  Union  asserts that the USITC 
thus acted inconsistently with Articles  3.1 and 3.2 of the Anti -Dumping  Agreement  and Articles  15.1 
and 15.2  of the SCM  Agreement .460 The United States  asks the Panel to reject the 
European  Union's  arguments  in their entirety .461 We examine the merits of the 
European  Union's  claims in the sections  that follow.  
7.4.4.1   Whether the USITC failed to consider whether there has been a significant 
increase i n dumped or subsidized imports as required by the first sentence in Article  3.2 
of the Anti -Dumping  Agreement and Article  15.2 of the SCM  Agreement  
7.227.   The European  Union  argues that the USITC 's volume analysis  failed to comply with the 
requirement  in Article  3.2 and Article  15.2 to "consider whether there has been a significant increase 
in [dumped or] subsidized imports" because the USITC 's "conclusion simply states that volumes of 
Spanish imports were significant".462 The European  Union  maintains  that the USITC 's conclusion was 
inadequate as the "text of [Article  3.2 and] Article  15.2 unequivocally stipulate [s] that a volume 
effect requires an increase of [dumped or] subsidized imports"463, and that "the authority must show 
a growth in [dumped or] subsidized imports".464 The European  Union alleges that the USITC failed 
to meet the requirements of Article  3.2 and Article  15.2 because it "only considered a significant 
presence  of Spanish imports in the domestic industry".465 
 
458 European  Union's  first written submission,  paras.  519-521. See also European  Union's  second written 
submission,  paras.  146-152. 
459 European  Union's  first written submission,  sections  VII(B)(2)-VII(B)(3); second written submission , 
sections  V(B)(2)-(3). 
460 European  Union's  first written su bmission , paras.  511, 517, and 525 ; second written submission , 
paras.  144-145 and 152 . 
461 United  States'  first written submission, paras.  164-195; second written submission, paras.  49-74. 
462 European  Union's  first written submission,  para. 521. See also Euro pean Union's  second written 
submission, paras.  146-152. 
463 European  Union's  first written submission, para. 523. 
464 European  Union's  first written submission, para. 524. We note that the European  Union specifically 
argues that "the USITC did not consider a volume effect within the meaning of [Article  3.2 of the 
Anti-Dumping  Agreement and] Article  15.2 of the SCM  Agreement ". (European  Union's  first written submission, 
para. 519). The European  Union repeatedly refers to the concept of "volume effect " throughout its 
submissions. See, e.g. European  Union's  first written submission, paras.  431, 453, 460, 465, 468, and 487. 
The concept of "volume effect " is not found in the Ant i-Dumping  Agreement or the SCM  Agreement. We 
understand the European  Union to not have intended any particular technical meaning to attach to this term. 
This is confirmed by the European  Union in its second written submission, where it observes that the di stinction 
between "volume analysis " and "volume effects analysis " is "a purely terminological issue and entirely 
irrelevant for the resolution of this dispute ". (European  Union's  second written submission, para.  150). We 
therefore will not refer to "volume  effects " except if contained in a quotation from the European  Union . 
465 European  Union's  first written submission, para.  525. (emphasis  original)  WT/DS 577/R  
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  7.228.   The United  States  responds that Article 3.2 and Article  15.2 do not require an investigating  
authority to find an absolute or relative incre ase in the volume of subject imports.466 
7.229.   We recall that t he first sentence in Article  3.2 and Article  15.2 sets out the requirements for 
the examinati on of the volume of dumped or subsidized imports:  
With regard to the volume of the [dumped or subsidized] imports, the investigating 
authorities shall consider whether there has been a significant increase in [dumped or 
subsidized] imports, either in absol ute terms or relative to production or consumption 
in the importing Member.  
In our view t he European  Union's  argument that an investigating authority "must show a growth in 
[dumped  or] subsidized imports"467 to "consider whether" there has been a significan t increase in 
volume is based on an erroneous construction of the term "consider whether" in Article  3.2 and 
Article  15.2. These provisions instruct an investigating authority to "consider whether" there has 
been a significant increase in volume. As noted above, the ordinary meaning of "consider" includes 
"[t]o view or contemplate attentively, to survey, examine" and "[t]o contemplate mentally , fix the 
mind upon; to think over, meditate or reflect on, bestow attentive thought upon, give heed to, take 
note of".468 To "consider" indicates a requirement that an investigating authority take something 
into account in reaching its decision , not a requ irement to arrive at a particular conclusion .469 This 
understanding is supported by the contrast between t he obligation  to "consider" that is contained in 
the first sentence of Article  3.2 and Article  15.2, and the use of the more definitive term 
"demonstra te" in Article  3.5 of the Anti -Dumping  Agreement and Article  15.5 of the SCM  Agreement , 
which state "[i]t must be demonstrated that the [dumped  or subsidized] imports are, through the 
effects of [dumping  or subsidies] … causing injury". Moreover, the first  sentence in Article  3.2 and 
Article  15.2 qualifies the instruction to "consider" with the word "whether" . Thus the ordinary 
meaning of "consider", its contrast with more definitive language used in other provisions of Article  3 
and Article  15, and the qua lification "whether", are incompatible with the 
European  Union's  interpretation that an investigating authority may only successfully "consider 
whether" there has been a significant increase in volume in circumstances where the investigating 
authority  can "show a growth in [dumped or] subsidized imports".470 Rather, the language of the 
first sentence of Article  3.2 and Article  15.2 makes clear that an investigating  
authority 's consideration of whether there has been a "significant increase" in volume may be 
evidenced by an examination of the change in volume, regardless of whether volumes in fact 
increased, decreased , or remained stable.  
7.230.   In support of its interpretation, the European  Union argues that the panel in US – DRAMs  
explicitly concluded that the "mer e consideration of a presence – or decrease – of imports is 
inconsistent with Article  15.2 SCM  [Agreement] ".471 The European  Union finds support for this 
assertion in the panel's  finding that "[a]lthough the [USITC] found that 'the absolute volume of 
subject imports  … is significant'  it did not determine that the increase  in the absolute volume of 
subsidized import s was significant".472 The panel's  conclusion was, however, based on a factual 
determination that there was no evidence that the investigating authority had considered whether 
there was a significant increase in the absolute volume of subject imports.473 Moreover, the panel 
did not conclude that this failure to determine a significant increase was inconsistent with Article  15.2 
of the SCM  Agreement. Rather, the Panel observed that "[s]ince Article  15.2 provides that '[n]o one 
or several of these factors can n ecessarily give decisive guidance', the fact that the [USITC] did not 
find that there was a significant increase in the absolute volume of subsidized imports is not per se  
 
466 United  States'  first written submission, paras.  181-195. 
467 European  Union's  first written submission, para. 524. We note  that the European  Union  clarified that 
it does not argue that volume of imports of Spanish ripe olives was  not significant . (European  Union's  opening 
statement at the second meeting  of the Panel , para. 54). 
468 Oxford Dictionaries online, defini tion of "consider " 
https://www.oed.com/view/Entry/39593?redirectedFrom=consider#eid  (accessed 7 July 2021), 
v., meaning  3.a. 
469 For a similar view, see Appellate  Body Report, China – GOES , para.  130. 
470 European  Union's  first written submission, para. 524. 
471 European  Union's  opening statement at the second meeting of the Panel, para.  56. 
472 European  Union's  second written submission , para. 151 (referring to Panel Report, US – 
Countervailing Duty Investigation on DRAM s, para. 7.234). (emphasis  original)  
473 Panel Report, US – Countervailing Duty Investigation on DRAMs , fn 226. WT/DS577/R  
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  inconsistent with Article  15.2 of the SCM  Agreement".474 The panel continued that "Ar ticle 15.2 [of 
the SCM  Agreement] does not require a determination that there has been a significant increase in 
subsidized imports".475 The panel observed, instead, that Article  15.2 of the SCM  Agreement "simply 
requires investigating authorities to 'consider'  whether there has been such an increase".476 
Consistent with our analysis above, the panel in US – DRAMs  further suggested that "an  injury 
determination may be consistent with Article  15 of the SCM  Agreement even in the absence of a 
determination that (as opposed to consideration whether)  there has been a significant increase in 
the volume of subsidized imports".477 The panel's  observa tions in US – DRAMs  are therefore 
consistent with our interpretation that compliance with Article  3.2 and Article  15.2 is unaffected by 
whether the volume of dumped or subsidized imports in fact increased, decreased , or remained 
stable.  
7.231.   We note that t he European  Union  argues that the United  States  misrepresents the 
European  Union's  argument as being that Article  3.2 and Article  15.2 require an investigating  
authority to "find" or " determine ", as opposed to "consider whether", there has been a significant 
increase in the volume of dumped or subsidized imports.478 Despite alleging this, t he European  Union  
nevertheless maintains  that its argument is that "the USITC failed to consider  a volume increase 
because it only considered a decrease".479 The European  Union  appears to suggest  that an 
investigating  authority cannot, by definition, consider  whether there was a "significant increase" in 
circumstances where  there was in fact a decreas e. As previously stated, we do not agree with this 
interpretation because an investigating authority's  compliance with the first sentence of Article  3.2 
and Article  15.2 is not dependent on whether the volume of imports increased, decreased, or 
remained st able. 
7.232.   On the basis of our interpretation as set out  above, we now turn to consider whether the 
USITC 's assessment of the volume of ripe olives satisfied the requirements of Article  3.2 of the 
Anti-Dumping  Agreement  and Article  15.2 of the SCM  Agreement . We agree with the view of the 
panel in Thailand - H-Beams  that to establish compliance with the first sentence of Article  3.2 and 
Article  15.2, "it must be apparent in the relevant documents in the record that the investigating 
authorities have given attenti on to and taken into account whether there has been a significant 
increase in dumped imports, in absolute or relative terms".480 The USITC identified that the volume 
of ripe olives from Spain decreased from 35,037 tonnes  to 32,782 tonnes  during the period of 
investigation.481 The USITC then identified the changes in the market share of Spanish ripe olives 
during the period of investigation.482 The USITC also examined the change in market shares in the 
retail sector.483 The USITC concluded  that the volume of ripe olives was significant on an absolute 
and relative basis , and found that the volume of subject ripe olives was significant relative to 
domestic production .484 The USITC 's examination of the changes in volume and market share of 
Spanish  ripe olives, coupled with the assessment of the  significance of these imports, shows  that 
the USITC considered whether there was a significant increase on an absolute and relative basis. 
We find that  the European  Union has thus not established that the USITC failed to consider whether 
there was a significant increase in the volume of Spanish ripe olives.485 
 
474 Panel Report, US – Countervailing Duty Investigation on DR AMs, para. 7.234. The panel did, 
however, find that the investigating authority had found that the increase in volume of subsidized imports was 
significant relative to domestic production and consumption. ( Panel Report, US – Countervailing Duty 
Investigation on DRAMs , para. 7.234). 
475 Panel Report, US – Countervailing Duty Investigation on DRAMs , fn 224. 
476 Panel Report, US – Countervailing Duty Investigation on DRAMs , fn 224. 
477 Panel Report, US – Countervailing Duty Investigation on DRAMs , fn 224. 
478 European  Union's  second written submission , paras.  147-148. 
479 European  Union's  second written submission , para. 148 (emphasis original);  see also  ibid. para. 149. 
480 Panel Report, Thailand – H-Beams , para.  7.161.  
481 Injury Determination, (Exhibit  EU-5), p. 18. 
482 Injury Determination, (Exhibit  EU-5), p.  18. 
483 Injury Determination, (Exhibit  EU-5), pp.  18-19. 
484 Injury Determination, (Exhibit  EU-5), pp.  18-19. 
485 We also reject the European  Union's  argument that , because the USITC 's concluding sentence does 
not contain the word "increase ", there is therefore "no indication that the USITC considered any increasing 
trends in volumes concerning Spanish imports for the industry as a whole ". (European  Union's  first written 
submission, para . 521). Article  3.2 and Article  15.2 do not contain a formal requirement that the conclusion of 
an investigating authority's  volume analysis contain the word "increase ". We accordingly reject the 
European  Union's  argument that the absence of the word "increase" from the USITC's  concluding sentence 
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  7.4.4.2   Whether  the USITC 's volume analysis was not based on an objective examination 
of positive evidence in violation of Articles  3.1 and 3.2 of the Anti -Dump ing Agreement 
and Articles  15.1 and 15.2 of the SCM  Agreement  
7.233.   The European  Union  argues that the manner in which the USITC conducted its examination 
of the volume of ripe olives was not based on an objective examination of positive evidence .486 The 
European  Union argues that this is because t he USITC  (a) only analysed the retail customer group 
and failed to consider the industry as a whole487; (b) improperly drew conclusions about the industry 
as a whole from the retail sector488; (c) failed to consider the distributional and institutional customer 
groups in a like manner as the retail customer group, without satisfactory explanation489; (d) failed 
to consider the distributional and institutional/food processor customer groups to the ext ent required 
for an objective examination based on positive evidence490; and (e)  failed to provide a meaningful 
basis for causation.491 The European  Union  asserts that the USITC thus did not conduct an objective 
examination bas ed on positive evidence in viol ation of  Articles  3.1 and 3.2 of the 
Anti-Dumping  Agreement  and Articles  15.1 and 15.2 of the SCM  Agreement .492 The United  States 
requests that the Panel  reject the European  Union's  arguments  in their entirety .493 
7.234.   In respect of the analysis below, we recall that an investigating  authority's  analysis of the 
volume of dumped or subsidized imports pursuant to Article  3.2 and Article  15.2 must comply with 
the overarching requirement contained in Article  3.1 and Article  15.1 that  a determination of injury 
must be based on an objective examination of positive evidence . 
7.4.4.2.1   Factual background  
7.235.   The section  of the Injury Determination titled "Volume of Subject Imports" provides as 
follows:  
Section  771(7)(C)(i)  of the Tariff Act provides that the "Commission shall consider 
whether the volume of imports of the merchandise, or any increase in that volume, 
either in absolute terms or relative to production or consumption in the United  States, 
is significant ." 
Subject imports had a significant presence in the U.S. market throughout the [period of 
investigation] on both an absolute and relative basis. The volume of subject imports 
increased from 35,037 short tons in 2015 to 35,139 short tons in 201 6, and then 
declined to 32,782 short tons in 2017. As observed above, subject imports'  market 
share increased from *** percent in 2015 to *** percent in 2016 and then declined to 
*** percent in 2017.  
As discussed above, ripe olives are generally sold to di stributors, retailers, and 
institutional/food processors. During the [period of investigation], the retail sector was 
the largest sector of the market for the domestic industry accounting for between *** 
percent and *** percent of U.S. processors'  commerci al shipments of ripe olives. 
Subject imports increasingly entered the retail sector during the [period of 
investigation] as U.S. importers'  commercial U.S. shipments from Spain increased *** 
percent, allowing subject imports to capture *** percentage point s of market share 
directly at the expense of the domestic industry in this sector between 2015 and 2017. 
U.S. importers'  U.S. commercial shipments of ripe olives from Spain to retailers as a 
share of their total reported shipments increased from *** percen t in 2015 to *** 
percent in 2016 and *** percent in 2017; by contrast, U.S. producers'  U.S. commercial 
shipments of ripe olives declined from *** percent in 2015 to *** percent in 2016 and 
 
establishes that the USITC did not "consider whether there has been a significant increase " in dumped or 
subsidized imports.  
486 European  Union's  first written submission, paras.  494-518; second written submission , 
paras.  127-145. 
487 European  Union's  first written submission, para. 494. 
488 European  Union's  first written submission , paras.  513-518; second written submission , para. 145. 
489 European  Union's  second written submission, paras.  127-140. 
490 European  Union's  first written submission, paras.  505-507. 
491 European  Union's  second written submission, paras.  141-144. 
492 European  Union's  first written submission, paras.  511 and 517 . 
493 United  States'  first written submission, paras.  164-180. WT/DS577/R  
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  *** percent in 2017. The record also indicates that, as a share of U.S. commercial 
shipments to retailers of private label and branded products, subject imports captured 
*** percentage points and *** percentage points respectively of market share from the 
domestic industry between 2015 and 2017.  
In light of the foregoing,  we find that the volume of subject imports from Spain is 
significant in absolute terms and relative to both apparent U.S. consumption and 
U.S. production.494 
7.4.4.2.2   Whether the USITC only analysed the retail customer group and failed to 
consider the industry as a  whole  
7.236.   The European  Union argues that even if this Panel does not find the USITC's  volume analysis 
flawed as a result of the allegedly arbitrary "segmentation", it is "in any event WTO inconsistent 
because instead of analysing volume effects for the domest ic industry as a whole , the USITC only 
analysed the retail 'segment'".495 We are unpersuaded by this argument, as in our view the 
USITC's  volume analysis clearly examined the industry as a whole. This is evidenced by the  
second paragraph  of the section  of the Injury Determination titled "Volume of Subject Imports", as 
extracted above.496 In that paragraph , the USITC described the change in the total volume of ripe 
olives from Spain during the period of investigation.497 The USITC relevantly stated that the "vo lume 
of subject imports increased from 35,037 short tons in 2015 to 35,139 short tons in 2016, and then 
declined to 32,782 short tons in 2017".498 The USITC then observed that "subject imports'  market 
share increased from *** percent in 2015 to *** percent in 2016 and then declined to *** percent 
in 2017" , and found that the volume of subject imports was significant relative to domestic 
production .499 The USITC also stated that "[s]ubject imports had a significant presence in the 
U.S. market throughout the [period of investigation] on both an absolute and relative basis".500 The 
USITC thus clearly examined the change in volume of Spanish ripe olives in  the market as a whole 
in its volume analysis.  
7.237.   The extract above shows that the USITC's  analysis of the change in total volume of Spanish 
ripe olives in the second paragraph  of the section  titled "Volume  of Subject Imports" was followed 
by a third paragrap h in which the USITC focused on changes in volume and market share in the 
retail sector.501 The European  Union  maintains  that "[t]he USITC 's volume effects analysis is 
contained in the third paragraph  since the fourth paragraph  only sets forth the conclusio n".502 The 
European  Union  reasons that the USITC only considered the retail customer group as "nothing is 
said in the third paragraph  about volume effects with respect to the domestic industry as a whole".503 
We are not persuaded by t he European  Union's  reading of the Injury Determination. The 
European  Union provides no explanation as to why we should understand the USITC's  volume 
analysis to be confined to the third paragraph  of the section  titled "Volume of Subject Imports". 
Absent a persuasive explanation otherwise, in our view the USITC's  volume analysis comprises all 
four paragraphs  of the section  titled "Volume of  Subject Imports".504 In particular, the 
USITC's  volume analysis includes the examination of change in the total volume and market share 
of Span ish ripe olives in the second paragraph  of that section . As the USITC considered the industry  
as a whole in the second paragraph, the European  Union's  argument that the third paragraph  does 
not address the market as a whole does not establish that the USIT C only considered the retail 
customer grou p. 
 
494 Injury Determination, (Exhibit  EU-5), pp.  18-19. (fns  omitted; redacted original)  
495 European  Union's  first written submission, para. 494. (emphasis original)  
496 Injury Determination, (Exhibit  EU-5), p. 18. 
497 Injury Determination, (Exhibit  EU-5), p.  18. 
498 Injury Determination, (Exhibit  EU-5), p. 18. 
499 Injury Determination, (Exhibit  EU-5), p. 18. (redacted original)  
500 Injury Determination, (Exhibit  EU-5), p. 18. 
501 Injury Determination, (Exhibit  EU-5), p. 18. 
502 European  Union's  first written submission , para.  496. 
503 European  Union's  first written submission, para.  496. 
504 Injury Determination, (Exhibit  EU-5), pp. 18-19. WT/DS 577/R  
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  7.4.4.2.3   Whether the USITC improperly drew conclusions about the industry as a whole 
from the retail sector  
7.238.   The European  Union argue s that the USITC "extended its analysis of volume effects for the 
retail 'segment ' to the entire domestic industry without any evidence, reasoning or explanation".505 
The European  Union  asserts this is because , in its view,  the reference to " the foregoing" in  the 
USITC 's conclusion "only refers to volume effects in the retail 's egment ' not to volume effects in the 
industry as a whole".506 
7.239.   We note that t he USITC concludes its volume analysis by stating that, "[i]n light of the 
foregoing , we find that the volume of subject imports from Spain is significant in absolute terms and 
relative to both apparent U.S. consumption and U.S. production" .507 In our view, the phrase "the 
foregoing" includes reference to the analysis of the total volume and market share of Spanish ripe 
olives in the second paragraph  of the volume analysis, as well as  the consideration of the retail 
customer group in the third paragraph  of the analysis. The European  Union provides no reason why 
the analysis covered by "the foregoing"  would include only the immediately preceding paragraph, 
and not the other paragraphs  of the USITC's  volume analysis. Accordingly, we find that the 
European  Union has not established that the reference to "the foregoing" in the USITC's  conclusion 
shows that the USITC improperly extended its conclusions regarding the retail sector to the whol e 
industry .508 
7.4.4.2.4   Whether the USITC failed to consider the distributional and institutional 
customer groups in like manner as the retail customer group, without satisfactory 
explanation  
7.240.   The European  Union additionally argues t hat the USITC failed to consider t he distributional 
and institutional/food processor customer groups in like manner as the retail customer group and 
failed  to provide a satisfactory explanation for not doing so.509 We agree with the European  Union  
that the USITC 's volume analysis did not consider the distributional and institutional/food processor 
customer groups in the same detail as the retail customer grou p. The USITC did , however,  provide 
an explanation for its focus on the retail customer grou p. The USITC observed that "ripe olives ar e 
generally sold to distributors, retailers, and institutional/food processors" , and explained  that "the 
retail sector was the largest sector of the market for the domestic industry"  during the period of 
investigation .510 While the percentage share of sales of each customer group by the domestic 
industry is redacted in the USITC report that was placed  before us , the United  States  has referred  
to a submission from the GOS from the underlying investigation that indicated tha t the domestic 
industry 's sales to customers in the retail segment accounted for between 85.3% to 87.1% of total 
annual shipments during the  2015-2017 period .511 The retail sector thus clearly represents the vast 
 
505 European  Union's  first written submission, para.  513. 
506 European  Union's  first written submission, para.  514. 
507 Injury Determination, (Exhibit  EU-5), p. 19. 
508 The European  Union  further claim s that the USITC 's volume analysis  improperly equated the retail  
customer group with the whole market  because the retail segment represents only around 20% of Spanish 
imports, and thus "cannot be representative for effects for the whole industry ". (European  Union's  first written 
submission , para. 502). We do not consid er that the small proportion of Spanish imports sold into the retail 
customer group establishes that the USITC  simply  equated the retail customer group with the whole market. 
As noted above, the USITC considered the change in volume and market share at the  level of the market as a 
whole. (See para.  7.236  above). T he USITC explained its subsequent focus on the retail customer group on the 
basis that the retail sector  was significant to the domestic industry, not because it represented a high 
proportion of sales for importers of Spanish ripe olives. (Injury Determination, (Exhibit  EU-5), p.  20). In our 
view, the explanation that the retail sector represents most of the do mestic industry's  sales provides a 
reasonable justification for the USITC's  focus on that sector, as the domestic industry would be particularly 
sensitive to developments in that sector. We therefore consider t he European  Union's  argument to be 
unpersuasiv e. 
509 European  Union's  second written submission , para. 130 (referring to Appellate  Body Report, US – 
Hot-Rolled Steel , para. 204) and para.  138; see generally  ibid. paras.  127-139. 
510 Injury Determination, (Exhibit  EU-5), p. 18. 
511 United  States'  first written submission  para. 175 and fn 242 (referring to Government of 
Spain 's prehearing brief, (Exhibit  USA-4), pp. 10-11; and Report accompanying Government of 
Spain 's prehearing brief, (Exhibit  USA-5), pp. 28-29). The European  Union  argues that the proportion of sales 
by the domestic industry to the retail sector could not be above 83% because the Injury Determination 
indicates that ripe olives from Spain commanded a 17% market share in the retail customer groups in 2017. 
(European  Union's 8 September  2020 response to Panel q uestion  No. 3(c), para. 140). The European  Union , 
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  majority of the domestic industry's  sales an d in our view this provides a reasonable justification for 
the USITC's  focus on the retail sector. We thus find that the USITC 's observation regarding  the 
importance  of the retail customer group to the domestic industry constitutes  a satisfactory 
explanati on for the particular focus given to that sector . 
7.241.   The European  Union  maintains that the significance of retailers to the domestic industry was 
not an appropriate explanation for the USITC 's focus on that customer group.512 We are not 
persuaded by the Europe an Union's  argument that the USITC 's identification of the retail customer 
group as representing the largest sector for the domestic industry was "a mere factual 
statement  … not an explanation".513 Rather, we consider the USITC 's observation of the fact tha t the 
retail customer group was the most important for the domestic industry also served as an 
explanation of the USITC 's focus on that section  of the market.514 We also reject the 
European  Union's  contention  that the United  States'  submission that the USITC "had an economic 
basis to focus on the retail segment, where the domestic industry was concentrated" was  an ex post  
justification .515 We find  the United  States'  assessment is clearly reflected in the USITC 's observation 
that "the retail sector was the  largest sector of the market for the domestic industry".516 
7.242.   We are furthermore not convinced by the European  Union's  reliance on the report of the 
panel in Mexico – Corn Syrup  for the proposition that the importance of a particular sector cannot 
justify an  investigating  authority 's focus on that sector in its injury examination .517 As discussed 
above, i n that case  the panel found that  the Mexican investigating  authority had only assessed one 
sector and "took no account of the fact that almost half of product ion" was sold in a second sector.518 
The panel observed that Mexico  had argued that the market sector focused on by the Mexican  
investigating  authority constituted a "major proportion" of domestic production and was thus 
consistent with Article  4.1 of the Anti-Dumping  Agreement . The panel rejected this argument, 
finding that, while Article  4.1 of the Anti -Dumping  Agreement allows for consideration of producers 
whose collective output of the like product constitutes a major proportion of domestic pro duction of 
that product, Article  4.1 does not allow an injury determination to be made simply with respect to a 
major proportion of production .519 The panel  based its  observation in that case on the fact  that the 
Mexican investigating  authority had expressl y excluded from consideration a sector representing a 
substantial portion of domestic production.520 We do not believe the panel's observation  supports 
the European  Union's  proposition that an investigating authority cannot give particular consideration 
to a specific sector where that sector is especially important to the domestic industry. Moreover, the 
facts before that panel were different to those before us, as the customer groups examined by the 
USITC represent the whole  ripe olive market, and the Europ ean Union  has not established that the 
USITC excluded from consideration data relating to any particular customer group.521 
7.243.   We are therefore  unpersuaded by the European  Union's  various arguments that the 
USITC 's observation that the "the retail sector was t he largest sector of the market for the domestic 
industry" did not satisfactorily explain and thereby justify the USITC 's focus on the trends in market 
share in the retail sector in its volume analysis.  
 
however, misunderstands the relevant footnote and table of the Injury Determination. These indicate that,  in 
2017, 17% of all Spanish imports were sold to the retail customer grou p. (Injury Determination, 
(Exhibit  EU-5), fn 104 and table II-1). This does not mean that 17% of all sales to the retail customer group 
were of ripe olives from Spain.  The range of 75 -80% sug gested by the European  Union  as "more likely " is, in 
any event , consistent with the USITC 's observation that "the retail sector was the largest sector of the market 
for the domestic industry ". (European  Union's  8 September  2020 response to Panel q uestion  No. 3(c), 
para. 140; Injury Determination, (Exhibit  EU-5), p. 18). 
512 European  Union's  second written submission , para. 138; 8 September  2020 response to Panel 
question No.  3(c), paras.  133 and 137 . 
513 European  Union's  second written submission , para. 138. 
514 Injury Determination, (Exhibit  EU-5), p.  18. 
515 European  Union's  8 September  2020 response to Panel q uestion  No. 3(c), para. 133. See also 
United  States'  first written submission , para. 175. 
516 Injury Determination, (Exhibit  EU-5), p. 18. 
517 European  Union's  8 September  2020 response to Panel q uestion  No. 3(c), para. 137 ( quoting  Panel 
Report, Mexico – Corn Syrup , para. 7.154  and fn 624). 
518 Panel Report, Mexico – Corn Syrup , para. 7.154.  
519 Panel Report, Mexico – Corn Syrup , para.  7.154  and fn 624. 
520 Panel Report, Mexico – Corn Syrup , para. 7.158 ; see also ibid. paras.  7.150 -7.152. 
521 See para. 7.214  above.  WT/DS 577/R  
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  7.4.4.2.5   Whether the USITC failed to consider the distribution al and institutional/food 
processor customer groups to the extent required for an objective examination based on 
positive evidence  
7.244.   The European  Union  maintains that the USITC failed to consider the distributional and 
institutional/food processor customer g roups to the extent required to constitute  an objective 
examination based on positive evidence , despite those groups accounting for around 80% of Spanish 
imports .522 In particular, the European  Union  assert s that the fact that the "share s of imports of 
Spanish ripe olives decreased" in the distributional and institutional customer groups is "entirely and 
conveniently  omitted " by the USITC.523 The European  Union argues that such "selective analysis" 
fell short of the requirement to conduct a n objective examination based on positive evidence.524 
7.245.   We agree that the USITC did not describe  the change in market share of Spanish ripe olives 
in the distributional and institutional customer groups. Furthermore, t he revised public versions of 
tables IV-6 and IV -8 provided by the United  States  confirmed the European  Union's  argument that 
the Spanish market share in the distributional and institutional customer groups trended down over 
the period of investigation.525 However, t he mere fact that there was a decrease in market share in 
the distributional and institutional customer groups by ripe olives from Spain does not establish that 
the USITC 's analysis was not based on an objective examination of positive evidence . As observed 
above, the USITC described t he change in volume with regard to the whole market , then gave 
additional consideration to trends in the retail sector.526 The USITC explained its focus on retailers 
on the basis of the importance of that channel of distribution to the domestic industry .527 In our 
view, the USITC's  observation that the retail sector was particularly important to the domestic 
industry implies that the distributional and institutional/food processor customer groups were not as 
important. We find further support for the conclusi on that the USITC's  approach was reasonable in 
the fact that the USITC had already observed that the absolute volume of subject imports decreased 
over the period of investigation.528 Moreover, as the United  States observes, the data cited to 
support the USI TC's discussion of the change in volume and market share in the retail sector also 
included supporting data on the distribution and institutional/food sectors.529 We consequently 
disagree with the view that the USITC  did not conduct an objective examination  based on positive 
evidence simply because the USITC chose not to describe the change in market share of Spanish 
ripe olives in the distributional and institutional customer groups.  
7.246.   Finally, we observe that the European  Union also cites the opinion of the dissenting USITC 
commissioner , in which the commissioner rejects the view that Spanish ripe olives gained market 
share in the retail customer group at the expense of the domestic ind ustry.530 The European  Union  
states that the dissenting commissioner  "referred to the 'industry's  overall market shares'  and 
dismissed the relevance of increased sales of Spanish ripe olives to retail customers".531 We recall 
 
522 European  Union's  first written submission , paras.  505-507. See also European  Union's  second written 
submission, para.  134. 
523 European  Union's  first written submission , para. 506; see also ibid. para.  504, table titled  
"U.S. importers ' U.S. commercial shipments of ripe olives from Spain " (based on Injury Determination, 
(Exhibit  EU-5), table II -1, p. II-2). 
524 European  Union's  first written submission , para. 507. 
525 United  States'  letter to the Panel dated  4 February  2021 (providing revised public versions of 
Injury  Determination, (Exhibit  EU-5), table s IV-6, IV-7, IV-8, and C -1). 
In its first written submission, the European  Union relied on table  II-1 in the Injury Determination to  
show that Spanish ripe olives lost 9.1% of market share in the distributional customer group and 0.7%  of 
market share in the institutional customer grou p. (European  Union's  first written submission , para. 504). As 
discussed above, t otal quantity and market share of all sales to each customer group are not identified in 
table II-1. (See fn  511 above).  Rather, table II-1 describes the proportion of Spanish imports directed to each 
customer group each year (for a total of 100% in any year). A decrease of 9.1  percentage  points  in the 
distributional customer group, therefore, indicates that there was a decrease in the proportion of Spanish 
imports sold to that customer grou p. This does not establish the direction or magnitude of the change in 
market share of Spanish impor ts, as that depends on the extent of corresponding changes in the total volume 
of domestic and other importer ripe olives sold to each customer group in the period of investigation.  
526 Injury Determination, (Exhibit  EU-5), p.  18. 
527 Injury Determination, (Ex hibit EU-5), p.  18. 
528 Injury Determination, (Exhibit  EU-5), p.  18. 
529 United  States'  first written submission, para.  178; Injury Determination, (Exhibit  EU-5), p.  18 and 
fns 104-105 (referring to table II -1). 
530 European  Union's  first written submission,  para. 510 (quoting Injury Determination, (Exhibit  EU-5), 
p. 28 (dissenting view)). 
531 European  Union's  first written submission,  para. 510. WT/DS577/R  
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  our view that the mere fact that  a dissenting view exists does not establish that the 
majority's  findings were not based on an objective examination of positive evidence.532 We do not 
find the European  Union's  observation that the dissenting commissioner  approached the volume 
analysis in a different manner to the majority alters our conclusions set out above. We note, 
moreover, that the dissenting opinion ultimately arrived at the same conclusion as the majority of 
commissioners that "the volume of subjec t imports, in absolute terms and relative to  
U.S. consumption, is significant".533 
7.4.4.2.6   Whether the USITC 's volume analysis failed to provide a meaningful basis for 
causation  
7.247.   The European  Union  also maintains that the USITC's  examination of volume could not form  
a "meaningful basis" for causation and was thus inconsistent with Article  3.2 and Article  15.2.534 
The European  Union bases this argument on the proposition that a n investigating  authority 's volume 
analysis "must provide 'explanatory force ' for the occurre nce of a significant volume increase".535 
In making this argument, the European  Union  notes the observation by the Appellate  Body in 
China  – GOES  that, when examining price suppression or depression under Article  3.2 and 
Article  15.2, "an investigating auth ority is required to consider the relationship between subject 
imports and prices of like domestic products, so as to understand whether subject imports provide 
explanatory force for the occurrence of significant depression or suppression of domestic price s".536 
The European  Union  argues that "there is no reason" why this obligation is not  equally applicable to 
an investigating  authority 's consideration of whether there was a significant increase in the volume 
of dumped or subsidized imports.537 We note that , in relation to volume, an investigating  authority 
is simply directed  by Article  3.2 and Article  15.2 to "consider whether there has been a significant 
increase in [dumped or subsidized] imports". The investigating  authority 's inquiry regarding volume 
only concerns the identification of the change in the volume of imports and an assessment of its 
signific ance. There is no further requirement to use this data to consider some further  phenomena 
such as  an effect on prices. We therefore  disagree with the European  Union's  assertion  that an 
investigating authority's volume analysis must provide "explanatory for ce" for the occurrence of a 
significant volume increase.  Accordingly , we reject the European  Union's  argument made on that 
basis.  
7.4.4.3   Conclusion on the USITC's  volume analysis under Articles  3.1 and 3.2 of the 
Anti-Dumping  Agreement and Articles  15.1 and 15.2 of the SCM  Agreement  
7.248.   For the reasons set out above, we find that the  European  Union has not demonstrated that 
the USITC improperly considered whether there had been a significant increase in the volume of 
dumped or subsidized ripe olives from Spain, as req uired by the first sentence of Article  3.2 of the 
Anti-Dumping  Agreement  and Article  15.2 of the SCM  Agreement . We find further that the 
European  Union has not demonstrated that the USITC 's volume analysis was not based on an 
objective examination of posit ive evidence . On this basis, we conclude that the European  Union  has 
not demonstrated  that the USITC 's volume analysis was inconsistent with Articles  3.1 and 3.2 of the 
Anti-Dumping  Agreement  and Articles  15.1 and 15.2 of the SCM  Agreement . 
7.4.5   The USITC 's examination  of the price effects of dumped and subsidized ripe olives 
from Spain  
7.249.   The European  Union  argues that the USITC 's consideration of price undercutting  by ripe 
olives from Spain was not based on an objective examination of positive evidence, and th us is in 
violation of Articles  3.1 and 3.2 of the Anti -Dumping  Agreement  and Articles  15.1 and 15.2  of the 
SCM Agreement .538 The European  Union's  arguments are premised on the view that the 
USITC 's consideration of price undercutting  should be properly unde rstood as a "second volume 
 
532 See para.  7.216  above.  
533 Injury Determination, (Exhibit  EU-5), p. 28 (dissenting view ). 
534 European  Union's  second written submission, paras.  141-142; first written submission, para.  517. 
535 European  Union's  second written submission, para.  142 (referring to Appellate  Body Report, China – 
GOES , para. 154). 
536 European  Union's  second written submission, para.  141 (quoting Appellate  Body Report, China – 
GOES , para. 154). 
537 European  Union's  second written submission , para.  142. 
538 European  Union's  first written submission, section  VII(C)(2) -(3); second written submission, 
section  V(C)(2) -(3). WT/DS 577/R  
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  analysis".539 In this section  we will consequently first address the question of whether the USITC 
conducted a "second volume analysis ". We will then consider the European  Union's  various 
arguments in support of its view that the USITC 's consideration of price undercutting  was not based 
on an objective examination of positive evidence.540 
7.250.   The United  States  maintains that the European  Union's  arguments are based on a 
misconstruction of Article  3.2 and Article  15.2, and the USITC did not conduct a second examination 
of the volume of ripe olives from Spain.541 The United  States  further responds that the USITC 's price 
effects analysis was based on an objective examination of positive evidence .542 
7.251.   We examine the merits of the European  Union's  claims in the sections  that follow.  
7.4.5.1   Whether the USITC 's examination of price undercutting  constituted a second 
volume analysis  
7.252.   The European  Union  argues that t he USITC "did not carry out a price effect analysis in the 
context of price undercutting" but rather "carried out a – second – volume analysis".543 The 
European  Union  alleges the USITC 's analysis of price undercutting  could "not consider a price effect 
in the form of an effect on the price of the domestic industry" because the USITC found no significant 
price suppression or price depression.544 The European  Union  asserts the USITC instead considered 
the effect of price undercutting  through changes in market share in the retail sector.545 The 
European  Union  maintains that changes in market share are a "volume effect" and thus that the 
"USITC nowhere considered … that domestic prices were affected by subject imports".546 
7.253.   The United  States  responds that the European  Union's  argument is based on a 
misconstruction of Articles  3.1 and 3.2 and Articles  15.1 and 15.2.547 The United  States  argues that 
these provisions provide that price undercutting is, in and of itself, a price effect.548 The United  States  
thus maintains that the USITC properly considered the effect of dumped and subsidized ripe olives 
on prices in the domestic market throu gh its analysis of price undercutting .549 
7.254.   We observe that i n the section  of the Injury Determination titled "Price Effects of the Subject 
Imports", the USITC examined the price effects of dumped and subsidized ripe olives from Spain 
during the period of inv estigation. The USITC first found that there was significant underselling by 
Spanish ripe olives.550 The USITC concluded that Spanish ripe olives did not have the effect of 
significantly depressing the prices of domestic ripe olives, or of preventing price increases that would 
otherwise have occurred to a significant degree.551 
7.255.   We note that the USITC employed the term "undersold" and "underselling" in place of 
"undercut" and " undercutting " in Article  3.2 of the Anti -Dumping  Agreement  and Article  15.2 of the 
SCM Agreement . We employ these terms interchangeably throughout.  
7.256.   The European  Union's  characterization of the USITC 's analysis of price undercutting  as a 
second volume analysis raises a range of complex interpretative questions. These include whether 
 
539 European  Union's  second written submission, paras.  162 and 164; see also ibid. para.  155 (alleging 
the "USITC undertook a som ewhat bizarre (and highly WTO -inconsistent)  hybrid price/volume analysis in the 
context of 'price undercutting '") and para.  160 (alleging "the USITC undertook a volume analysis that was 
window -dressed as a price undercutting analysis "). The arguments that flow from the 
European  Union's  characterization of the USITC's examination of price undercutting as a second volume 
analysis are addressed at paragraphs 7.263 -7.281  below.  
540 European  Union's  first written submission, section  VII(C)(2) -(3); second written submission, 
section  V(C)(2) -(3). 
541 United  States'  first written submission, section  V(B); second written submission, section  IV(C).  
542 United  States'  first written submission, section  V(B);  second written submission, section  IV(C).  
543 European  Union's  second written submission, para.  154. 
544 European  Union's  first written submission, paras.  528 and 541; second written submission, 
para. 154. 
545 European  Union's  first written submission, para.  542. 
546 European  Union's  second written submission, para.  154. 
547 United  States'  first written submission,  paras.  196-206. 
548 United  States'  first written submission, para.  199. 
549 United  States'  first written submission, paras.  201-205; second written submission, paras.  75-79. 
550 Injury Determination, (Exhibit  EU-5), p.  21. 
551 Injury Determination, (Exhibit  EU-5), p.  21. WT/DS577/R  
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  such a  "hybrid price/volume analysis"552 is something conceived of and permitted by the 
agreements. We do not consider it necessary to discuss all these issues  because  we disagree with 
the central premise of the European  Union's  argument : the proposition that price undercutting  is 
not, in and of itself, an effect on domestic prices.553 For the reasons that follow, we find that the text 
of Articles  3.1 and 3.2 and Articles  15.1 and 15.2 does not support this interpretation. Rather, in our 
view, those provisions reco gnize that consideration of significant price undercutting  under the 
second  sentence of Article  3.2 and Article 15.2 on its own constitutes an "examination of … the effect 
of the dumped imports on prices in the domestic market for like products" under Article 3.1 and 
Article  15.1. 
7.257.   We first observe that Article  3.1 and Article  15.1 direct an investigating  authority to examine 
the "effect of the [dumped or subsidized] imports on prices in the domestic market for like products". 
We next recall that the second sentence of Article  3.2 and Article  15.2 states:  
With regard to the effect of the [dumped  or subsidiz ed] imports on prices, the 
investigating authorities shall consider whether there has been a significant price 
undercutting by the [dumped  or subsidized]  imports as compared with the price of a 
like product of the importing Member, or whether the effect of  such imports is otherwise 
to depress prices to a significant degree  or prevent price increases, which otherwise 
would have occurred, to a significant degree.  
The second sentence of Article  3.2 and Article  15.2 thus describes what an investigating  authorit y 
should examine "[w]ith regard to the effect of the [dumped or subsidized] imports on prices". While 
the second sentence in Article  3.2 and Article  15.2 does not specify which "prices" are the object of 
the enquiry, we understand this to be a reference to  "prices in the domestic market for like products". 
We consider this to be correct based on the clear cross -reference to Article  3.1 and Article  15.1. This 
is also supported by the parallel manner in which the examination of volume is treated in the 
first sentence of Article  3.2 and Article  15.2. To make the same point from a different perspective, 
an interpretation of the term "prices" in the second sentence as referring not to "prices in the 
domestic market for like products", but to some other prices, wo uld seem to contradict the otherwise 
logical progression of analysis presented in Article  3 and Article  15 by leaving unspecified what an 
examination of subject imports effect on domestic prices requires.554 We are thus of the view that 
the second sentence in Article  3.2 and Article  15.2 is intended to detail what action s by an 
investigating  authority constitutes an examination of the effect on domestic prices as required by 
Article  3.1 and Article  15.1. 
7.258.   Article  3.2 and Article  15.2 instruct an investigating  authority to consider whether the 
dumped or su bsidized  imports result in any of three phenomena, i.e. significant price undercutting , 
significant price depression, or significant price suppression. The use of the disjunctive "or" between 
these three phenomena indicates that they are independent lines of inquiry. A view that only price 
depre ssion and price suppression constitute price effects would read out of the text the option to 
consider price undercutting as an independent channel of inquiry. This would be inconsistent with 
the requirement that effect be given to all terms of a treaty.555 We thus interpret Article  3.2 and 
Article  15.2 to mean that a consideration of any of the three price effects can independently satisfy 
the requirement in Article  3.1 and Article  15.1 to examine the "effect … on prices in the domestic 
market for like prod ucts".556 
7.259.   The European  Union  maintains that, even if Article  3.2 and Article  15.2 provide for three 
different price effects, only price depression and price suppression  are "'true ' stand -alone price 
effects".557 The European  Union  argues that price undercutt ing cannot itself be an "effect … on 
prices" because it is only through price depression or suppression that "the price curve of the 
 
552 European  Union's  second written submission, para.  155. 
553 European  Union's  first written submission, para.  541; second written submission, para.  158. 
554 For a similar view about the logical progression of analy sis in Article  3 of the 
Anti-Dumping  Agreement  and Article  15 of the SCM  Agreement, see, e.g. Appellate  Body Report, China – 
GOES , paras.  128 and 143 . 
555 Appellate  Body Report, US – Gasoline , DSR 1996:1, p.  21. 
556 Similar conclusions are arrived at in prior reports, such as Appellate  Body Report, China – GOES , 
para. 137; and Panel Reports, China – Autos (US) , para.  7.255; China – Cellulose Pulp , para.  7.63; and 
China  – HP-SSST (Japan ) / China – HP-SSST (EU) , para.  7.129.  
557 European  Union's  26 March  2021 response to Panel question No.  1, para.  7. WT/DS 577/R  
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  domestic industry 's prices" can be impacted.558 In the European  Union's  view, then, "price 
undercutting requires, at least f actually, the existence of price depression and/or price 
suppression".559 However, we consider that such a narrow interpretation of "effect … on prices" is 
neither required by the definition of "effect" nor consistent with the structure of the provisions. T he 
ordinary meaning of an "effect" is, inter alia , "[s]omething accomplished, caused, or produced; a 
result, consequence".560 This definition indicates that the examination of the "effect" of subject 
imports on domestic prices required by Article  3.1 and Article  15.1 must entail an examination of 
whether there has been some result or consequence with respect to domestic prices t hat was caused 
by subject imports. We do not see any reason that such a result or consequence may only be in the 
form of a change in the price of the domestic like product . It is our view, rather, that such a result 
or consequence could be in the form of a  change in the relative prices of domestic like product and 
the products with which it competes . Such changes could impact the competitiveness of the price of 
the domestic like product, even if there is no evidence during the period of investigation that t he 
price of the domestic like product is significantly depressed or suppressed. We find this broader view 
to be consistent with the structure of the second sentence in Article  3.2 and Article  15.2, which as 
explained above, provides for three separate chan nels of inquiry. In contrast, the 
European  Union's  narrow interpretation would in practice read price undercutting out of Article  3.2 
and Article  15.2 as an independent line of inquiry. Informed by the principle that an interpretation 
must be above all bas ed on the text of the treaty561, we conclude that the broader understanding of 
the meaning of an "effect … on prices" must be the correct interpretation. We therefore reject the 
European  Union's  argument that price undercutting  is not a "'true ' stand -alone" price effect and find 
that the USITC 's analysis of price undercutting  is properly characterized as an examination of price 
effects.  
7.260.   We find our position is consistent with the findings by the Appellate  Body in China – HP-SSST 
(Japan ) / China – HP-SSST (EU) . The European  Union  quotes th e observation by the Appellate  Body 
in that report that "an inquiry into price undercutting … is not satisfied by a static examination of 
whether there is a mathematical difference at any point in time during the [period of investigation] 
without any asses sment of whether or how these prices interact over time".562 The European  Union  
further quotes the Appellate  Body's  view that an investigating  authority must instead conduct a 
"dynamic assessment of price developments and trends in the relationship between the prices of the 
dumped [or subsidized] imports and those of domestic like products over the duration of the [period 
of investigation]".563 Based on these observations, the European  Union  asserts that the USITC 
conducted a "static exam ination" of various instances of price undercutting, but then failed to 
conduct a "dynamic assessment" of the interaction of the prices of Spanish imports and of domestic 
prices.564 The European  Union  asserts that the USITC 's alleged failure to conduct a "d ynamic 
assessment" means the USITC "did not consider price effects  … in the context of its price 
undercutting analysis".565 
7.261.   In our view, the European  Union's  submissions are based on a misunderstanding of the 
Appellate  Body's  finding in China – HP-SSST (Jap an) / China – HP-SSST (EU) . In that case, the 
Appellate  Body found that the Chinese investigating  authority had failed to properly explain the basis 
of its finding that a certain grade of dumped imports were underselling the domestic like product.566 
In par ticular, the Appellate  Body expressed concern that the Chinese investigating  authority had 
failed to explain how significant underselling could be found to exist given that the price of the 
domestic like product had more than doubled during the course of o ne year, while the price of 
dumped imports had fallen.567 The Appellate  Body based this finding on the view that an objective 
examination of price undercutting  should take into account any relevant trends across the period of 
 
558 European  Union's  first written submission, fn  467. 
559 European  Union's  26 March  2021 response to Panel question No.  1, para.  7. 
560 Oxford Dictionaries online, definition of "effect " 
https://www.oed.com/view/Entry/59664?rskey=HPLU9L&result=1&isAdvanced=false#eid  (accessed 
7 July 2021), n., meaning b. 
561 See, e.g. Appellate Body Report, Japan – Alcoholic Beverages II , DSR 1996:I, p.  105. 
562 European  Union's  second written submission, para. 159 (quoting Appellate  Body Report s, 
China - HP-SSST (Japan ) / China – HP-SSST (EU) , para. 5.160).  
563 Appellate  Body Report s, China – HP-SSST (Japan ) / China – HP-SSST (EU) , para. 5.161. See  also 
European  Union's  second written submission, para. 159. 
564 European  Union's  second written submission, para. 159. 
565 European  Union's  second written submission, para. 159. ( emphasis  original)  
566 Appellate  Body Reports, China  – HP-SSST (Japan)  / China – HP-SSST (EU) , paras.  5.168 -5.171.  
567 Appellate  Body Report s, China  – HP-SSST (Japan ) / China – HP-SSST (EU) , para. 5.168.  WT/DS577/R  
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  investigation, as well as the d uration of any identified price undercutting . As the Appellate  Body 
explained, "an objective examination would have taken into account all the positive evidence relating 
to, inter alia , the contrary price movements of the [subject] imports and domestic [like product], as 
well as the limited period during which the perceived mathematical difference occurred".568 
7.262.   We agree w ith the Appellate  Body's  interpretation that an analysis of price undercutting 
must be objective and must take into account all  relevant evidence. The Appellate  Body's  rejection 
of a mere "static examination", however, concerned whether the Chinese investigating  
authority's  examination of price undercutting  was based on an objective examination of positive 
evidence. The Appellate  Body's  statements were unrelated to the question of whether a price effect 
identified through a consideration of price undercutting  may only be in the form of price suppression 
or price depression. On the contrary, the Appellate  Body clearly held the same view as this Panel, 
having emphasi zed that, "[w]e do not read Article  3.2 as suggesting that the 'effect'  of price 
undercutting must either be price depression or price suppression". The Appellate  Body observed 
that, "while price undercutting by imports may lead to price depression or price suppression, 'there 
is no requirement in Article  3.2 to demonstrate the existence of these other phenomena when 
considering the existence of price undercutting'".569 This is consistent with our understanding of 
Article  3.2 and Article  15.2 and does not support the European  Union 's position that price 
undercutting is not, in and of itself, a price effect.  We therefore do not agree with the 
European  Union's  characterization of the USITC's  analysis of price undercutting as a second volume 
analysis, and do not consider it relevant to further examine th at proposition . 
7.4.5.2   Whether the USITC 's price effects analysis was not based on an objective 
examination of positive evidence in violation of Articles  3.1 and 3.2 of the 
Anti-Dumping  Agreement  and Articles  15.1 and 15.2 of the SCM  Agreement  
7.263.   In the previous section  we disagreed with the European  Union's  characterization of the 
USITC 's examination of price undercutting  as a second volume analysis. Having rejected this view, 
we now directly address the European  Union 's various arguments in support of its position that the 
USITC 's price undercutting  analysis itself was not based on an objective examination  of positive 
evidence , and thus violated Articles  3.1 and 3.2 of the Anti -Dumping  Agreement  and Articles  15.1 
and 15.2 of the SCM  Agreement .570 We approach these arguments based of our understanding t hat 
the USITC 's analysis of price undercutting  was an examination of price effects, not a volume analysis.  
7.264.   The European  Union  argues the USITC failed to conduct an objective examination of price 
effects based on positive evidence because the USITC  (a) concluded that underselling resulted in a 
loss of market share in the retail sector without adequate supporting evidence571; (b) only 
considered price effects in the retail sector and not at the level of the domestic industry as a whole572; 
and ( c) improperl y extended its conclusions  concerning price effects in the retail sector to the 
 
568 Appellate  Body Report s, China  – HP-SSST (Japan ) / China – HP-SSST (EU) , para. 5.169.  
569 Appellate  Body Report s, China  – HP-SSST (Japan ) / China – HP-SSST (EU) , para. 5.156. (emphasis 
original)  
570 European  Union's  first written submission , paras.  550-551 and 556 -557; second written submission, 
para. 157. 
571 European  Union's  first written submission, para.  543; second written submission, para.  157; and 
opening statement at the first meeting of the Panel, para.  125. 
We note that the United  States asserted following the second Panel meeting that the 
European  Union's argument that the USITC's  price effects analysis was unsupported by positive evidence is 
outside the Panel's  terms of reference, alleging that arguments to this effect constitute  a "wholly separate 
claim" that was not identified in the European  Union' s panel request.  (United  States'  25 February  2021 
response to Panel question No.  15, para. 51). We reject the United  States'  assertion. T he 
European  Union's  request for establishment  clearly  identifie d a claim that "the USITC 's price effects analysis 
lacked positive evidence ". (European  Union's  panel request, p.  2). This description is sufficient to identify the 
claim.  Furthermore, no due process issues arise, as the European  Union  raised its arguments in its opening 
statement at the first meeting of the Pa nel and the United  States  had the opportunity to respond, which it did 
in its second written submission.  (United  States'  second written submission, paras.  75-79). 
572 European  Union's  first written submission, paras.  531 and 540-551. WT/DS 577/R  
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  domestic industry as a whole.573 The United  States  responds that the USITC 's price effects analysis 
was based on an objective examination of positive evidence.574 
7.265.   In respect of t he analysis below, we recall that  an investigating  authority's  analysis of the 
effect of  dumped or subsidized imports  on prices in the domestic market for like products pursuant 
to Article  3.2 and Article  15.2 must comply with the overarching requirement c ontained in Article  3.1 
and Article  15.1 that  a determination of injury must  be based on an objective examination of positive 
evidence . 
7.4.5.2.1   Factual background  
7.266.   In the section  of the Injury Determination entitled "Price Effects of the Subject Imports", the 
USITC recounted that it had collected pricing information on 4 products using data from 23  importers 
and 2 domestic producers.575 The USITC observed that these data showed ripe olives from Spain 
undersold the domestic like product in 37 of 48 quarterly comparis ons, with an average underselling 
margin of 30.3%.576 The USITC stated that ripe olives from Spain "undersold the domestic like 
product and captured market share in the retail sector of the market" .577 The USITC  then examined 
the loss of market share in the retail branded and retail private label sectors.578 The USITC observed 
that the data concerning lost sales " provides further support for the proposition th at subject imports 
were sold at low prices and as a res ult captured market share from the domestic industry".579 The 
USITC concluded that the underselling by ripe olives from Spain was significant because of the 
following factors : 
(1) [T]he predominant underselling by subject imports on a per instance and volum e 
basis; (2 ) the high degree of substitutability between the domestic like product and 
subject imports ; (3) the importance of price in purchasing decisions; (4 ) the 
underselling by subject imports which enabled them to capture market share from 
domestic in dustry in the important retail sector; and (5 ) the reports of lost sales.580 
7.4.5.2.2   Whether the USITC concluded that underselling resulted in a loss of market 
share in the retail sector without adequate supporting evidence  
7.267.   We begin with the European  Union's  assert ion that the USITC concluded that underselling 
resulted in a loss of market share in the retail sector without adequate supporting evidence. The 
European  Union  challenges four aspects of the data relied upon by the USITC in drawing that 
conclusion. These a re that  (a) the purchasers responding to questionnaires used to identify lost sales 
were mainly distributors581; (b) the identified  underselling was concentrated in the institutional 
channel582; (c) there were instances of overselling in the retail channel in two out of three years583; 
and (d) the USITC failed to produce a price undercutting  margin specifically for the retail channel.584 
We consider each of these in turn.585 
 
573 European  Union's  first written submission, paras.  531 and 552-556. 
574 United  States'  second written submission, paras.  75-79; 26  March  2021 responses to Panel question 
No. 1, paras.  1-6, and No.  2, paras.  7-23; and 13  April 2021 comments on the 
European  Union's  26 March  2021 response to Panel question No.  1, paras.  9-18. 
575 Injury Determination, (Exhibit  EU-5), pp.  19-20. 
576 Injury Determination, (Exhibit  EU-5), p.  20. 
577 Injury Determination, (Exhibit  EU-5), p.  20. 
578 Injury Determination, (Exhibit  EU-5), pp.  20-21. The United  States clarified in response to Panel 
questions that the "retail branded sector " refers to domestic shipments of branded product to retailers, that 
references to the "retail private label sector " refer to domestic shipments of private label product to retailers, 
and that references to the "retail sector " reflect the sum of the prior two categories. 
(United  States'  26 March  2021 response Panel question No.  2, para.  15). 
579 Injury Determination, (Exh ibit EU-5), p.  21. 
580 Injury Determination, (Exhibit  EU-5), p.  21. 
581 European  Union's  second written submission , para. 157. 
582 European  Union's  second written submission , para.  157. 
583 European  Union's  second writte n submission, para. 157. 
584 European  Union's  second written submission , para. 157. 
585 We note that paragraphs  7.267 -7.275  include a discussion of factual statements made by the 
United  States in  response to questions from the Panel following the second Panel meeting. 
(United  States'  26 March  2021 response to Panel  questions). As discussed above, these factual statements 
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  7.268.   We observe that Article  3.2 and Article  15.2 do not specify what methodology an  
investigating  authority must employ when considering price undercutting .586 Whatever methodology 
is adopted, however, is subject to the overarching requirement contained in Article  3.1 and 
Article  15.1 that it be objective and based on positive evidence.587 We recall that, to perform an 
objective examination, an investigating  authority must support its findings with reasoning  that is 
coherent and internally consistent.588 We further recall that, while we must address the 
European  Union's  argument through a cr itical analysis of the USITC 's examination of price 
undercutting , a panel is not to undertake a de novo  review of the investigation, nor substitute its 
judgment for that of the investigating  authority.589 
7.269.   The European  Union  first alleges that the lost sales data referred to by the USITC do not 
support the USITC 's findings concerning  the retail sector because purchasers responding to 
questionnaires used to identify lost sales were mainly distributors, not retailers.590 We reca ll that 
the USITC observed that data concerning lost sales " provides further support  for the proposition that 
subject imports were sold at low prices and as a result captured market share from the domestic 
industry".591 Most relevantly, the USITC observed t hat of 25 responding purchasers  (a) 13 reported 
that they had purchased subject imports instead of domestically produced product since 2015; 
(b) 12 of these 13 purchasers reported that subject import prices were lower than those for the 
domestically produc ed product; and (c ) 6 of the 13 purchasers reported that price was a primary 
reason for its decision to shift its purchases from the domestic like product to subject imports.592 In 
response to questions the United  States  clarified, however, that of the 13 p urchasers who reported 
that they purchased subject imports rather than the domestic product, 6 were retailers.593 The 
United  States  also clarified that of the 12 purchasers who reported that the subject imports were 
lower priced than the domestic like produ ct, there were also 6 retailers.594 The United  States  further 
explained that, of the 6 purchasers who reported that lower prices were the primary reason that 
they purchased subject imports rather than the domestic like product, 4 were retailers.595 It is clear, 
therefore, that a large portion of purchasers in each relevant category of the lost sales data were 
retailers. We consequently find that an objective investigating  authority could have treated the lost 
sales data as supporting the USITC 's conclusion that underselling by subject imports resulted in a 
loss of market share by the domestic industry  in the retail sector . 
7.270.   The European  Union's  second argument is that the fact that the underselling was 
concentrated in the institutional sector means th ere was no evidence supporting the finding that 
underselling resulted in a loss of market share in the retail sector by the domestic industry.596 Of 
the four pricing products used by the USITC to collect pricing data, two were retail products (Products 
1 and 2) and two were institutional products (Products 3 and 4).597 The European  Union argues that, 
 
were made by the United  States in response to questions from the Panel intended to clarify certain data 
redacted in the version of the Injury Determination available to the Panel. (See paras.  7.196 -7.201  above). 
The United  States did not provide the unredacted Injury Determ ination in support of these factual statements. 
The European  Union was provided with an opportunity to comment on the United  States response, however, 
and did not challenge the accuracy of the relevant factual statements made by the United  States. 
(Europea n Union's  13 April 2021 comments on the United  States'  26 March  2021 response to Panel questions). 
In light of the fact that the United  States has access to the unredacted version of the Injury Determination, 
and the absence of any challenge by the Europea n Union to the accuracy of such factual statements, we will 
treat the factual statements by the United  States discussed in paragraphs  7.267 -7.275 as provided in good 
faith and accepted by the parties for the purpose of this dispute.  
586 This view is shared by prior panels. For example, t he panel in EC – Tube or Pipe Fittings  stated that 
"Article  3.2 requires the investigating authorities to consider whether price undercutting is 'significant ' but does 
not set out any specific requirement relating to the calculation of a margin of undercutting, or provide a 
particular methodology to b e followed in this consideration. " (Panel Report, EC – Tube or Pipe Fittings , 
para. 7.281. See also , e.g.  Panel Report s, Thailand – H-Beams , para. 7.159; EU – Biodiesel (Indonesia) , 
para. 7.137; and EC – Countervailing Measures on DRAM Chips , para. 7.334 ). 
587 For a similar conclusion, see, e.g. Appellate  Body Report s, Mexico – Anti-Dumping Measures on Rice , 
para. 204; and China – GOES , para. 130. 
588 See para. 7.209  above.  
589 See para.  7.4 above.  
590 European  Union's  second written submission , para. 157. 
591 Injury Determination, (Exhibit  EU-5), p. 21. 
592 Injury Determination, (Exhi bit EU-5), p. 21. 
593 United  States'  26 March  2021 response to Panel question No. 2 , para. 22. 
594 United  States'  26 March  2021 response to Panel question No. 2 , para. 22. 
595 United  States'  26 March  2021 response to Panel question No. 2 , para. 22. 
596 European  Union's  second written submission , para. 157. 
597 Injury Determination, (Exhibit  EU-5), fn 112. WT/DS 577/R  
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  while the USITC observed an average underselling margin of 30.3%, "footnote 117 [of the Injury 
Determination] makes clear that such underselling was 'concentrate d' in the institutional sector and 
hence could not lead to any market share losses – the effect that the USITC is considering – since 
the USITC only found such share loss for the retail 'segment'".598 The actual text of this footnote, 
however, does not support the European  Union's  assertion that underselling by Products 1 and 2 in 
the retail sector "could not lead to any share losses". The relevant part of footnote 117 of the 
Injury  Determination reads : "[w]e recognize that on an overall volume basis the underselling by 
subject imports was concentrated in Products 3 and 4 (i.e ., institutional), the two pricing products 
involving the largest quantities of subject imports during the [period of investigati on] and in the 
sector of the market where subject imports had a large presence".599 In our view, the mere fact that 
the volume  of underselling was concentrated in the institutional products (Products 3 and 4)  does 
not support the conclusion that there was n o underselling by the retail products (Products 1 and 2), 
or that such underselling could not result in a loss of market share in the retail sector. On the 
contrary, it is unsurprising that the volume of underselling would be concentrated in the pricing 
products involving the largest quantities of subject imports (i.e.  Products 3 and 4). Accordingly, we 
do not agree with the European  Union's  characterization of the implications of the 
USITC's  statements in footnote 117.  
7.271.   The European  Union  thirdly argues tha t the USITC 's finding was unsupported by evidence 
because "there were even instances of overselling  in the retail channel in two out of three years".600 
We agree that the Injury Determination confirms the existence of overselling in two years, stating 
"[i]nstances of overselling occurred in products 1 -2 (retail products ) in 2015 and 2016 only".601 
There was thus no overselling in 2017, the final year of th e period of investigation  for the 
Injury  Determination . In total, the USITC identified 11 instances of overselling with an average 
overselling margin of 10.9%.602 However, in our view, t he mere fact that there was overselling does 
not establish that underse lling could not have result ed in market share loss by the domestic industry. 
The Injury  Determination indicates that Product 1 recorded four-quarters of underselling and 
eight-quarters of overselling, while Product 2 recorded nine-quarters of underselling and 
three -quarters of overselling.603 Products  1 and 2 undersold the domestically produced product in 
54% of quarterly comparisons, which reflected 62% of the total import shipments of those 
two pricing products.604 For each product, the average underselling  margin exceeded the average 
overselling margin.605 There was thus a greater volume of underselling, and at greater margins, than 
of overselling. Furthermore, the underselling was more concentrated towards the end of the period 
of investigation, as instance s of overselling occurred in Products 1 and 2 in 2015 and 2016, but not 
2017.606 In light of these facts we conclude that an objective  investigating  authority could have 
reasonably treated the underselling data concerning Products 1 and 2 as supporting the conclusion 
that underselling resulted in a loss of market share in the retail sector.607 
7.272.   Lastly, the European  Union  argues that the USITC "provided no undercutting margin for the 
retail channel in its analysis, only an average industry -wide margin of 30.3 percent", and that this 
was insufficient to show underselling in the retail channel.608 The European  Union  correctly observes 
that the price undercut ting margins were not prepared on the basis of the retail sector, but in relation 
to each pricing product.609 As the United  States  conceded, the USITC 's pricing data were based on 
 
598 European  Union's  first written submission, para. 543. 
599 Injury Determination, (Exhibit  EU-5), fn 117 and p. 20. 
600 European  Union's  second written submission, para. 157. (emphasis original)  
601 Injury Determination, (Exhibit  EU-5), p. V-11. 
602 Injury Determination, (Exhibit  EU-5), p.  V-11, table V -10. 
603 Injury Determination, (Exhibit  EU-5), p.  V-11, table V -10. 
604 United  States'  26 March  2021 response to Panel question No. 2, para.  23. 
605 United  States'  26 March  2021 response to Panel question No. 2, para.  23. 
606 Injury Determination, (Exhibit  EU-5), p.  V-11. 
607 We agree with the panel's  observation in EC – Tube Fittings , the "fact that certain sales may have 
occurred at 'non-underselling prices ' does not eradicate the effects in the importing market of sales that were 
made a t underselling prices ", given that "there might be a considerable number of sales at undercutting prices 
which might have had an adverse effect on the domestic industry ". (Panel Report, EC – Tube or Pipe Fittings , 
para. 7.277  (emphasis original)) . 
608 European  Union's  second written submission, para. 157. 
609 In addition to stating the average industry -wide price undercutting margin of 30.3 %, the USITC also 
refers to table V -10 which contains price undercutting margins specific to each pricing product. (Injury 
Determination, (Exhibit  EU-5), table V -10). While the price undercutting margins specific to each pricing 
product are redacted in the version of the Injury Determination available to the Panel, we have not reason to 
doubt that these were calculated by the USITC.  WT/DS577/R  
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  product type, not purchaser, and "[t]he USITC did not calculate underselling margins specific to any 
channel of distribution".610 In other words, the two relevant retail pricing products, Products 1 and 
2, were sold to both retailers and distributors.  
7.273.   We observe that t he USITC did not prepare data specifically for sales to retailers  and thus 
did not have a price undercutting  margin specific to the retail sector, despite relying on this data to 
conclude that there had been significant underselling in the retail sector.611 The European  Union  
maintains that the USITC 's conclusions as to price undercutting  in the retail sector were thus 
unsupported, as the data concerning price undercutting  did not specifically relate to the retail 
channel.612 The European  Union  seeks to support this assertion by observing that a price 
undercutting  margin a t the industry level could mask overselling in a particular sector, such as the 
retail channel.613 The United  States , however, responds that the relevant pricing data were collected 
uniformly at the same level of trade, specifically the first arm 's length s ale from the importer or 
producer to the purchaser.614 The United  States  asserts that there was no evidence indicating that 
the prices of those products would be different when sold to retailers and distributors.615 
7.274.   As noted above, Article  3 of the Anti -Dump ing Agreement  and Article  15 of the 
SCM Agreement  do not specify what methodology an investigating  authority must employ when 
considering price undercutting .616 In our view an objective investigating authority could reasonably 
have treated the underselling by Products 1 and 2 , being retail products,  as supporting an inference 
that such underselling occurred in the retail sector, thus resulting in the identified loss of market 
share. This inference was also consistent with evidence of lost sales,  as discussed above.617 We thus 
find that the European  Union  has not established that an objective investigating authority could not 
have concluded that the underselling identified in Products 1 and 2 resulted in the domestic 
market 's loss of market share i n the retail sector.  
7.275.   On the basis of the reasons above, we therefore conclude that the European  Union  has not 
established that the USITC 's finding that price undercutting  resulted in a loss of market share in the 
retail sector was unsupported by evidence.  
7.4.5.2.3   Whether the USITC only considered price effects in the retail sector and not at 
the level of the domestic industry as a whole  
7.276.   We next turn to the European  Union's  argument that the USITC only considered price effects 
in the retail customer group and not in the whole market.618 In particular, the European  Union  
asserts  that the USITC 's price effects analysis only examined the loss of market share in the retail 
sector. The European  Union  argues that the loss of market share was "the 'effect[] ' that the USITC 
chose to consider in the context of its price effect analysis for price undercutt ing" and that the USITC 
was thus "obliged to consider [the loss in market share] for the … industry as a whole ".619  
7.277.   In our assessment, t he European  Union's  argument is premised on a misconstrued 
understanding of the USITC 's price effects analysis as a seco nd volume analysis , and the erroneous 
view that the USITC 's specific consideration of the loss of market share in the retail sector in a 
portion of the price effects analysis was the entire  second volume analysis .620 But this is not how 
the USITC undertook its price effects analysis. The USITC 's price effects analys is did not only 
examine the retail sector, but compared quarterly prices across four pricing products and assessed 
lost sales data from a range of purchasers.621 The four pricing products represented sales across all 
customer groups and accounted for a sign ificant portion of all sales of Spanish ripe olives. For 
example, in 2017 alone, the sales data for the pricing products was based on approximately 65.5% 
 
610 United  States'  25 February  2021 response to Panel question No. 12 , para. 46. 
611 United  States'  25 February  2021 response to Panel question No. 12 , para. 46. 
612 European  Union's  second written submission, para.  156. 
613 European  Union's  second written submission, para.  156. 
614 United  States'  26 March  2021 response to Panel question No. 2, para.  19. 
615 United  States'  26 March  2021 response to Panel question No. 2, para.  19. 
616 See para.  7.268  above.  
617 See para.  7.269  above.  
618 European  Union's  first written submission, para. 540. 
619 European  Union's  first written submission, para. 546. (emphasis original ) 
620 See, e.g. European  Union's  second written submission, para.  164. 
621 Injury Determination, (Exhibit  EU-5), pp.  18-20. WT/DS 577/R  
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  of reported shipments of subject imports from Spain .622 The USITC 's examination of price 
undercutting  was thus not limited to a consideration of the price of sales to retailers, but rather took 
into account the prices across the whole market. The European  Union's  argument that the 
USITC 's price effects analysis only considered the retail sector is thus not factually supported and 
fails.623 
7.278.   The European  Union also argues that the view of the dissenting USITC commissioner  "fully 
supports" the argument that the USITC's  price effects analysis failed to properly consider the market 
as a whole.624 The European  Union  argues that this is because the dissenting commissioner "focused 
her analysis under 'Price Effects of Subject Imports'  on the overall  market shares, not the retail 
segment".625 The European  Union then quotes three paragraphs  of the dissenting 
commissioner' s analysis in their entirety and concludes that the commissioner's  statements "speak 
for themselves".626 We agree that the dissenting commissioner  concluded that the underselling by 
Spanish ripe olives was not significant.627 However, both the majority and the dissent employed the 
same market -wide data regarding price comparisons and lost sales to assess the existence and 
significance of price underc utting .628 Therefore we disagree that the dissenting 
commissioner's  analysis establishes that the majority failed to properly consider the market as a 
whole , and consequently reject the European  Union's  argument to that effect . 
7.4.5.2.4   Whether the USITC improperly extended its conclusions concerning the 
consideration of price effects in the retail sector to the domestic industry as a whole  
7.279.   Finally, the European  Union argues the USITC "improperly extend[ed] its consideration of 
price effects for the retail 'segment'  to the entire domestic industry without any evidence, reasoning 
or explanation".629 The European  Union bases this argument on the language of the 
USITC's  concluding paragraph  of its price effects analysis.630 The USITC concluded:  
Accordingly, based on the cu rrent record, we find that there was significant price 
underselling of the domestic like product by subject imports. As a result of this 
underselling, subject imports captured market share from the domestic industry in the 
large and important retail sector  while maintaining their significant presence in the 
U.S. market for ripe olives throughout the [period of investigation] . The low ‐priced 
subject imports consequently had significant adverse effects on the domestic industry, 
which are described further bel ow.631 
7.280.   The European  Union  argues  that the reference in the first sentence of this extract to "the 
current record" is a reference only to " price effects (in the form of volume effects ) in one out of 
three 'segments ' (retail ) and not in the industry as a whol e".632 The European  Union  argues that the 
reference to "underselling of the domestic like product by subject imports" in the first sentence, and 
the statement that subject imports had adverse effects "on the domestic industry" in the final 
 
622 Injury Determination, (Exhibit  EU-5), p.  20. 
623 The European  Union  further argue s that the USITC failed to consider the distributional and 
institutional customer groups in a like manner as the retail customer group, without satisfactory explanation. 
(European  Union's  second written submission,  paras.  163-169). As discussed above in relation to the 
USITC's  volume analysis, however, we cons ider the USITC to have provided a satisfactory explanation for its 
particular focus on the retail sector. (See para.  7.240  above). In particular, the USITC observed in its 
examination of price undercutting that "[o]f particular note is that subject imports undersold the domestic like 
product and captured market share in the retail sector of the market, which was the largest and most 
important sector of the U.S. market  for the domestic industry ". (Injury Determination, (Exhibit  EU-5), p. 20). 
We consider the USITC to have thus provided a clear and satisfactory explanation of its decision to focus on the 
retail sector as the largest and most significant sector for the domestic industry.  
624 European  Union's  first written submission , paras.  548-549 (referring to Injury Determination, 
(Exhibit  EU-5), pp.  29-31 (dissenting view )). 
625 European  Union's  first written submission , para. 548. (emphasis original)  
626 European  Union's  first written submission , paras.  548-549. 
627 Injury Determination, (Exhibit  EU-5), p.  31 (dissenting view).  
628 Compare Injury Determination, (Exhibit  EU-5), pp.  20-21 (majority view)  with pp.  29-30 (dissenting 
view).  
629 European  Union's  first written submissi on, para. 552. 
630 European  Union's  first written submission, para.  553. 
631 Injury Determination, (Exhibit  EU-5), p.  22. 
632 European  Union's  first written submission, para.  553. WT/DS577/R  
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  sentence, are both references to the dome stic industry as a whole, and are thus unsupported by the 
USITC 's findings in relation to underselling in the retail sector.633 
7.281.   We recall that we have already found above that the USITC 's price effects analysis concerned 
the whole market  and therefore relat ed to the industry as a whole . Thus we consider that "the 
current record" referred to in the first sentence of the extract includes the USITC 's analysis of the 
whole market , as opposed to just the section  in which the USITC examined changes in market share  
in the retail sector. We also note that  the USITC 's statement in the final sentence that there were 
certain consequential adverse impacts on the domestic  industry is based on an analysis "described 
further below". By "described further below", we understa nd the USITC to be referring to its impact 
and causation analysis in the following sections. This sentence, then, merely indicates the outcome 
of the forthcoming analysis, rather than being a conclusion that would appropriately be challenged 
on the basis o f the USITC 's price effects analysis. Consequently, we find that the European  Union  
has failed to establish that the concluding paragraph  of the USITC 's price effects analysis shows that 
the analysis was not based on an objective examination of positive ev idence.634 
7.4.5.3   Conclusion on the USITC 's price effects analysis under Articles  3.1 and 3.2 of the 
Anti-Dumping  Agreement  and Articles  15.1 and 15.2 of the SCM  Agreement  
7.282.   For the reasons above, we find that the European  Union  has not established that the 
USITC 's examination of price undercutting  should be characterized as a second volume analysis. We 
find further that the European  Union  has not demonstrated  that the USITC 's price effects analysis 
was not based on an objective examination of positive evidence . On this basis, we conclude that the 
European  Union  has not demonstrated  that the USITC 's price effects analysis was inconsistent with 
Articles  3.1 and 3.2 of the Anti -Dumping  Agreement  and Articles  15.1 and 15.2 of the 
SCM Agreement . 
7.4.6   The USITC 's examination of the consequent impact of dumped and subsidized ripe 
olives from Spain  
7.283.   The European  Union  argues that the USITC 's impact analysis was not based on an objective 
examination of positive evidence, and was thus inconsistent with Articles  3.1 and 3.4 of the 
Anti-Dumping  Agreement  and Articles  15.1 and 15.4 of the SCM  Agreement .635 The European  Union  
first argues that the USITC 's findings concerning volume and price effects were not at the level of 
the industry as a whole and thus could not s upport a conclusion that ripe olives from Spain had a 
consequent impact on the domestic industry.636 The European  Union  also argues that the 
USITC 's impact analysis was itself not based on an objective examination of positive evidence.637 
The United  States  requests the Panel to reject the European  Union's  arguments in their entirety.638 
We examine the merits of the European  Union's  claims in the sections  that follow.  
 
633 European  Union's  first written submission, para.  554. 
634 The European  Union  also asserts that the USITC's  consideration of price effects provided no 
meaningful basis for causation regarding the domestic industry as a whole . (European  Union's  second written 
submission, para. 170; see also 10  June 2020 response t o Panel question  No. 22 , para. 119 (referring to 
Appellate  Body Reports, China - HP-SSST (Japan ) / China – HP-SSST (EU) , para. 5.180); 8  September  2020 
response to Panel question  No. 3(c) , paras.  92-95; and 12 November  2020 response to Panel question  No. 29 , 
para. 187). This argument is, however, based on the European  Union's  prior assertion that the "USITC 
considered a volume increase of Spanish imports only in the retail channel and considered a mere presence of 
Spanish imports for the indus try as a whole ". (European  Union's  second written submission, para. 170). We 
have already found that the USITC's  volume and price effects analyses were not exclusively limited to the retail 
sector, and that there is no requirement to find an increase in vo lume under Article  3.2 and Article  15.2. (See 
paras.  7.226 -7.282  above). Th e European  Union's  argument thus fails.  
635 European  Union's  first written submission, section  VII(D); second written submission, section  V(D).  
636 European  Union's  first written submission, paras.  574-589; second written submission, 
paras.  179-182. 
637 European  Union's  first written submission, paras.  566-573 and 590 -597; second written submission, 
paras.  173-178 and 183 -185. 
638 United  States'  first written submission, section  V(C); second written submission, section  IV(D).  WT/DS 577/R  
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  7.4.6.1   Whether the USITC could have made a finding of consequent impact on the basis 
of its findings concerning volume and price effects  
7.284.   The European  Union  argues that the USITC did not make any findings concerning the volume 
and price effects of ripe olives  from Spain at the "level of the domestic industry as a whole".639 In 
relation to vol ume, the European  Union  observes that the USITC did not find an increase in subject 
imports in absolute terms, or relative to domestic consumption or production across the market as 
a whole.640 In relation to price effects, the European  Union  observes that the price undercutting  
identified by the USITC only resulted in a loss of market share in the retail sector. The 
European  Union  asserts that such findings do not concern the domestic industry as a whole, and 
thus the USITC could not establish a consequent impact on the domestic industry.641 The 
United  States  argues that the European  Union's  arguments are based on a misinterpretation of the 
relationship between the provisions of Article  3 of the Anti -Dumping  Agreement  and Article  15 of the 
SCM Agreement .642  
7.285.   We recall that pursuant to Article  3.1 of the Anti -Dumping  Agreement  and Article  15.1 of the 
SCM Agreement , a determination of injury must involve an objective examination based on positive 
evidence of both (a ) the volume of the dumped or subsidized import s and the effect of the dumped 
or subsidized imports on prices in the domestic market for like products ; and (b ) the consequent 
impact of these imports on domestic producers of such products. Article  3.2 and Article  15.2 detail 
what is required for an exam ination  of volume and price effects. Article  3.4 and Article  15.4 set forth 
the requirements for this examination of the impact of the dumped or subsidized imports.  Article  3.4 
of the Anti -Dumping  Agreement provides that:  
The examination of the impact of t he dumped  imports on the domestic industry 
concerned shall include an evaluation of all relevant economic factors and indices having 
a bearing on the state of the industry, including actual and potential decline in sales, 
profits, output, market share, pro ductivity, return on investments, or utilization of 
capacity; factors affecting domestic prices; the magnitude of the margin of dumping; 
actual and potential negative effects on cash flow, inventories, employment, wages, 
growth, ability to raise capital or  investments. This list is not exhaustive, nor can one 
or several of these factors necessarily give decisive guidance.  
7.286.   The list of economic factors and indices in Article  3.4 of the Anti -Dumping  Agreement  is the 
same as in Article  15.4 of the SCM  Agreement , except that Article  15.4 changes the order of certain 
listed economic factors and indices, excludes "the magnitude of the margin of dumping", and 
includes a specific indicator concerning agriculture. We consider the obligations arising from the  
two provisions to be the predominantly the same for the purpose of addressing the arguments raised 
by the European  Union . 
7.287.   The European  Union's  argument concerns the relationship between the findings an 
investigating  authority makes in its examination of v olume and price effects under Article  3.2 and 
Article  15.2, and the investigating  authority 's subsequent examination of the consequent impact of 
such volume and price effects under Article  3.4 and Article  15.4. We understand the European  Union  
to contend t hat the USITC 's finding that underselling resulted in a loss of market share by the 
domestic industry in the retail sector concerns only one sector of the market as a whole, and thus 
not the domestic industry as a whole. This argument relates to the requir ement identified in prior 
Appellate Body reports, with which we agree, that an investigating  authority must assess the impact 
of subject imports on the domestic industry as a whole.643 We disagree, however, with the 
 
639 European  Union's  first writte n submission, paras.  574, 581, and 583. We note that the 
European  Union's  first written submission separates its argument that the USITC did not make any findings 
concerning the volume and price effects of ripe olives at level of the domestic industry as a  whole into a 
section  on volume and a section  on price effects. (European  Union's  first written submission, section  VII(D)(3), 
paras.  574-582 (regarding volume), and section  VII(D)(4), paras.  583-589 (regarding price effects)). We will 
address these argume nts together as, in our view, the substantive issues are the same.  
640 European  Union's  first written submission, para.  574. 
641 European  Union's  first written submission, paras.  574, 581, and 583.  
642 United  States'  first written submission, para.  216. 
643 We ag ree with the view of the Appellate  Body in China – HP-SSST (Japan ) / China – HP-SSST 
(EU) that an impact analysis must be carried out with respect to the industry as whole. As the Appellate  Body 
said: "while there is no exclusive methodology prescribed for an investigating authority to conduct an 
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  European  Union's  contention  that in the absence of  volume and price effects "at the level of the 
domestic industry as a whole" there could be no impact .644 We do not see any reason why  findings 
concerning volume and price effects that relate to one sector cannot have consequent impacts on 
the industry as a whole. A deterioration in one sector could clearly impact the domestic industry as 
a whole. In our view, t here is no need for every sector to be negatively impacted for the domestic 
industry 's economic and financial indicia to deteriorate, a lthough the degree of any such 
deterioration will be determined by the combined influence of developments in all sectors. We 
therefore reject the European  Union's  argument that the USITC 's lack of findings concerning volume 
and price effects "at the level of the domestic industry as a whole" could not result in any consequent 
impact.  
7.4.6.2   Whether the USITC 's impact analysis was not based on an objective examination 
of positive evidence in violation of Articles  3.1 and 3.4 of the Anti -Dumping  Agreement  
and Articl es 15.1 and 15.4 of the SCM  Agreement  
7.288.   The European  Union  makes two arguments that the USITC 's impact analysis was itself not 
based on an objective examination of positive evidence. First, the European  Union  argues this is 
because the USITC failed to consider the ripe olive market as a whole.645 Second, the European  Union  
argues that the USITC improperly drew conclusions about the ripe olive industry as a whole from 
the retail sector.646 The United  States  reque sts the Panel to reject the European  Union's  arguments 
in their entirety.647 
7.289.   In respect of the analysis below, we recall that  an investigating  authority's  analysis of the 
consequent impact of  dumped or subsidized imports  on the domestic industry pursuant to  Article  3.4 
and Article  15.4 must comply with the overarching requirement contained in Article  3.1 and 
Article  15.1 that  a determination of injury must  be based on an objective examination of positive 
evidence . 
7.4.6.2.1   Factual background  
7.290.   In the section  of the Injury Determination titled "Impact  of the Subject Imports", the USITC 
examined the consequent  impact of Spanish ripe olives on the domestic industry. The USITC 
relevantly stated:  
U.S. processors ' output indicia were mixed from 2015 to 2017. On the one hand, 
U.S. processors ' production capacity was s table between 2015 and 2017, production 
increased by *** percent, and capacity utilization increased by *** percentage points. 
On the other hand, U.S. processors ' U.S. shipments (by quantity ) declined  by *** 
percent. Inventories generally increased from 2015 to 2017.  
U.S. processors ' employment ‐related data also were mixed. The number of production 
and related workers ("PRWs"), total hours worked, and hours worked per PRW each 
declined overall from 201 5 to 2017. However, wages paid, hourly wages, and worker 
productivity each increased overall between 2015 and 2017.  
Many of the U.S. processors ' financial performance indicia deteriorated over the [period 
of investigation] . Net income fell by *** percent f rom 2015 to 2017 while operating 
income declined by *** percent during the same period. As a ratio to net sales, net 
income and operating income also both declined, by *** percentage points and *** 
percentage points, respectively. Capital expenditures fell  by *** percent, and research 
 
examination under Article  3.4, an investigating authority 's examination of the relationship between the dumped 
imports and the state of the domestic industry mu st be one that enables the investigating authority to derive 
an understanding about the impact of the dumped imports on the domestic industry as a whole ". 
(Appellate  Body Report s, China – HP-SSST (Japan ) / China – HP-SSST (EU) , para. 5.204 ( emphasis  omitte d)). 
644 European  Union's  first written submission, paras.  574, 581, 583, and 588.  
645 European  Union's  first written submission , paras.  566-573. 
646 European  Union's  first written submission, paras.  590-597; second written submission, 
paras.  177-178 and 183-185. 
647 United  States'  first written submission, paras.  219-231. WT/DS 577/R  
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  and development expenses also declined. Although total net assets increased, the 
operating return on assets declined from 2015 to 2017.  
We find that subject imports from Spain had a significant impact on the domestic 
industry.  As discussed above, the significant volumes of subject imports that undersold 
the domestic like product captured market share from the domestic industry in its 
largest sector of the market – the retail sector – and also resulted in U.S. processors of 
ripe olives carrying increasing inventories. There is evidence in the record indicating 
that the retail sector was the domestic industry 's most important sector of the 
U.S. market for ripe olives and one in which the domestic industry lost profits during 
the [period of investigation] . As a result, several of the domestic producers ' indicators 
were worse than they would have been otherwise.648 
7.4.6.2.2   Whether the USITC 's impact analysis only examined the retail sector and not 
the industry as a whole  
7.291.   We first address the European  Union's  argument that the USITC only examined the retail 
sector and not the industry as a whole, and therefore did not conduct an objective examination.649 
The European  Union  bases its argument on the fourth paragraph  of the USITC 's impact analysis  
extracted above. The European  Union  maintains that the economic indicia of market shares, 
inventories , and lost profits referred to in that paragraph  were only examined with respect to the 
retail sector.650 The European  Union  asserts that "there is no explanation by the USITC why 
three  negative economic factors related to the retail segment  should impact the domestic industry 
as a whole".651 
7.292.   In our view , the European  Union's  argument misconstrues the Injury Determination. The 
European  Union's  reading of the determination fails to consider  the context of the USITC 's discussion 
of the loss of market share in the retail sector within the broader impact analysis. The USITC 
indicated that the loss of market share in the retail sector  resulted in increased inventories and lost 
profits. The USITC observed that "[a]s a result, several of the domestic producers ' indicators were 
worse than they would have been otherwise". The USITC does not specify which indicators it refers 
to here, but i n our view this statement clearly relates to, and is consistent with, the 
USITC 's identification in the immediately preceding paragraph  that "[m]any of the 
U.S. processors ' financial performance indicia deteriorated over the [period of investigation] ", 
including net income, operating income, capital expenditure, research and development expenses, 
and operating return on assets.652 These indicators were all considered on an industry wide basis in 
the preceding paragraph . The European  Union  itself acknowledges  that, in the paragraphs  preceding 
the USITC 's discussion of the loss of market share in the retail sector, the USITC "assessed economic 
factors for the industry as a whole".653 In our view, the USITC 's discussion of the domestic 
industry 's loss of market s hare and consequent increase in inventories and loss of profits was clearly 
linked with the identified deterioration of a range of economic indicators affecting the whole domestic 
industry. We are therefore not convinced by the European  Union's  assertion that the USITC only 
considered economic factors related to the retail sector , as it ignores the clear connection drawn by 
the USITC between the loss of market share in the retail sector and the deterioration of a range of 
industry wide economic indicators.  
7.293.   The European  Union  also observes in support of its argument that the USITC 's impact 
analysis exclusively considered the retail sector the fact that the "dissenting opinion equally found 
that there was no impact on the domestic industry as a whole".654 As we addressed above, we do 
not consider the mere fact that a dissenting  view exists to establish that the majority 's findings were 
not based on an objective examination of positive evidence.655 The European  Union  has provided no 
further explanation as to  why the dissenting commissioner's  conclusion that there was no significant 
 
648 Injury Determination, (Exhibit  EU-5), pp.  22-24. (fns  omitted; redacted original)  
649 European  Union's  first written submission , para.  566. 
650 European  Union's  first written submission, para. 568. 
651 European  Union's  first written submission, para. 568. 
652 Injury Determination, (Exhibit  EU-5), pp. 23-24. 
653 European  Union's  second  written submission, para. 174; see also further discussion of this at 
United  States'  first written submission, para. 229. 
654 European  Union's  first written submission, para.  570 (referring to Injury Determination, 
(Exhibit  EU-5), p.  32 (dissenting view)). 
655 See para.  7.216  above.  WT/DS577/R  
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  impact on the domestic industry as a whole establishes that the majority 's impact analysis only 
considered the retail sector. Rather, as discussed above, in our view , the majority connected  the 
domestic industry 's loss of market share, and consequent increase in inventories and loss of profits, 
with the deterioration of a range of economic indicators affecting the whole domestic industry.  As 
such, we do not consider that the Europea n Union's  reference to the dissenting opinion of one of the 
commissioners  sufficient to establish that the majority 's impact analysis was not based on an 
objective examination of positive evidence.656 
7.4.6.2.3   Whether the USITC 's impact analysis improperly extended the USITC finding of 
market share losses in the retail sector to the industry as a whole  
7.294.   We next consider the European  Union's  argument that the USITC 's conclusion in the impact 
section  improperly extended the USITC 's findings concerning the impact of mark et share losses in 
the retail sector to the industry as a whole without any evidentiary basis.657 The European  Union  
bases this argument on the last two sentences of the section  of the Injury Determination titled 
"Impact  of the Subject Imports" , where the USITC stated:  
Thus, other factors cannot explain the domestic industry 's market share losses in the 
retail sector and overall financial performance declines.  
Accordingly, for the above reasons, we conclude that subject Imports [sic] had a 
significant adverse impact on the domestic industry.658 
7.295.   In relation to these final sentences, the European  Union  argues that the USITC did not 
explain how its findings concerning a loss of market share in the retail sector could impact the 
industry as a whole.659 For the reasons discussed above , we find  this argument to be unpersuasive, 
as we found the USITC to have connected the increase in inventories and lost profits resulting from 
a loss of market share in the retail sector with the identified deterioration in  certain industry wide 
financial indicators.660 
7.296.   The European  Union  also argues that the USITC failed to explain how it could arrive at its 
finding of significant impact when only around 20% of Spanish imports were sold into the retail 
 
656 In its second written submission the European  Union  recharacterizes its argument that the USITC 
failed to examine the consequent impact on the domestic industry as a whole by distinguishing between 
concerns relating to the US ITC's "assessment of the economic factors " and the "assessment of the relationship 
between subject imports and the state of the domestic industry (consequent impact) ". 
(European  Union's  second written submission , paras.  174-178). We understand the argument s made in 
relation to the "assessment of the relationship between subject imports and the state of the domestic industry 
(consequent impact) " to be the same in substance as the European  Union's  argument that the USITC 
improperly drew conclusions about the ripe olive industry as a whole from the retail sector , which we dismiss 
at paras.  7.294 -7.297  below.  
In relation to the USITC's  "assessment of economic factors ", the European  Union also introduced a 
separate line of argument that "the use of non -segmented economic indicators after the US  'segmented'  the 
industry in the context  of Article  15.2 [of the SCM  Agreement] is in itself WTO -inconsistent ". 
(European  Union's  12 November  2020 response to Panel question No. 31, para.  196; see also second written 
submission, para.  176). As discussed above, we do not adopt the European  Union' s characterization of the 
Injury  Determination as based on a "segmented analysis", nor do we consider the European  Union to have 
established that the USITC's consideration of customer groups was, in and of itself, not based on an objective 
examination of p ositive evidence. (See paras.  7.205 -7.217  above). We thus disagree with the premise of the 
European  Union's  argument and reject it on that basis.  
657 European  Union's  first written submission, paras.  591-597. We note that the European  Union divide 
this argument into two sections. The first of these concerns the USITC's  allegedly imp roper extension of its 
"findings of an impact through volume effects  in the retail 'segment'  to the industry as a whole ". 
(European  Union's  first written submission, section  VII(D)(5) (emphasis added)). The second concerns the 
USITC's  allegedly improper ex tension of its "findings of an impact through price effects  in the retail 
'segment'  to the industry as a whole ". (European  Union's  first written submission, section  VII(D)(6) (emphasis 
added)). As the European  Union observes, however, the considerations un derlying both these arguments are 
the same. (European  Union's  first written submission, para.  595). We have thus decided to treat these two 
arguments together as concerning the USITC's  relevant finding that significant price undercutting resulted in a 
loss of market share in the retail sector, and consequently led to a deterioration of certain of the domestic 
industry's  financial performance indicators. (Injury Determination, (Exhibit  EU-5), pp.  23-24). 
658 Injury Determination, (Exhibit  EU-5), p. 26.  
659 European  Union's  first written submission, paras.  591 and 595.  
660 See para.  7.293  above.  WT/DS 577/R  
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  sector, and in circums tances where the volume of Spanish imports was decreasing at the industry 
level.661 We do not agree that these facts would prevent an objective investigating authority arriving 
at the USITC 's findings concerning impact. The USITC connected  the domestic indu stry's  loss of 
market share, and consequent increase in inventories and loss of profits in the retail sector, with the 
deterioration of a range of economic indicators affecting the whole domestic industry .662 The facts 
observed by the European  Union  do not negate the impact on the domestic industry identified by 
the USITC resulting from a loss of market share in the retail sector, by far the largest market for the 
domestic industry.  
7.297.   We therefore reject the European  Union's  argument that the USITC 's impact an alysis was 
not based on an objective examination of positive evidence because the USITC improperly extended 
findings of market share losses in the retail sector to the industry as a whole without any evidentiary 
basis.  
7.4.6.3   Conclusion on the USITC 's impact anal ysis under Articles  3.1 and 3.4 of the 
Anti-Dumping  Agreement  and Articles  15.1 and 15.4 of the SCM  Agreement  
7.298.   For the reasons above, we find that the USITC 's findings concerning volume and price effects 
did not prevent the USITC from properly examining the consequent impact of dumped and subsidized 
ripe olives from Spain, as required by Article  3.4 and Article  15.4. We find further that the 
European  Union has n ot demonstrated that the USITC 's impact analysis was not based on an 
objective examination of positive evidence . On this basis, we conclude that the European  Union  has 
not demonstrated  that the USITC 's impact analysis was inconsistent with Articles  3.1 and  3.4 of the 
Anti-Dumping  Agreement , and Articles  15.1 and 15.4 of the SCM  Agreement . 
7.4.7   The USITC 's causation analysis of dumped and subsidized ripe olives from Spain  
7.299.   In the section  of the Injury Determination titled "Impact  of the Subject Imports", the USITC  
additionally examined whether dumped and subsidized ripe olives from Spain were causing injury to 
the domestic industry. The USITC examined, inter alia , whether the injury identified as resulting 
from Spanish  ripe olives should in fact be attributed to ei ther a decline in apparent consumption or 
an increase in non -subject imports.663 The USITC concluded that neither of these factors explained 
the injury experienced by the domestic industry.664  
7.300.   The European  Union  challenges the USITC 's non-attribution analysis regarding the decline 
in apparent consumption665 and the USITC 's non-attribution analysis of non -subject imports , notably  
from Morocco.666 The European  Union  allege s the USITC 's non-attribution analyses were not based 
on an objective exa mination of positive evidence, inconsistent ly with Articles  3.1 and 3.5, and 
Articles  15.1 and 15.5.667 The United  States  asks the Panel to reject the 
European  Union's  arguments in their entirety.668 
7.301.   We examine the merits of the European  Union's  claims in th e sections  that follow.  
 
661 European  Union's  second written submission, para. 184. 
662 Injury Determination, (Exhibit  EU-5), pp.  23-24. 
663 Injury Determination, (Exhibit  EU-5), pp.  25-26. 
664 Injury Determination, (Exhibit  EU-5), p.  26. 
665 European  Union's  first written submission, paras.  620-630. 
666 European  Union's  first written submission, paras. 631-638. 
667 The European  Union  also claims that the USITC failed to carry out its causation assessment with 
respect to the domestic industry as a whole. (European  Union's  first written submission, para. 612). This 
argument concerns the same paragraph  of the Injury Determination discussed at paras.  7.291 -7.293  above in 
relatio n to the USITC's  impact analysis. The European  Union's  couches its argument in essentially the same 
terms. We thus do not give separate consideration to the European  Union's  argument that the causation 
analysis failed to consider the domestic industry as a  whole. This argument fails for the same reasons the 
argument concerning the impact analysis failed.  
668 United  States'  first written submission, section  V(D); second written submission, section  V(E). WT/DS577/R  
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  7.4.7.1   Whether the USITC 's non-attribution analysis of the decline in apparent 
consumption was not based on an objective examination of positive evidence in violation 
of Articles  3.1 and 3.5 of the Anti -Dumping  Agreement  and Articles  15.1 and 15.5 of the 
SCM Agreement  
7.302.   The European  Union  claims that the USITC 's non-attribution analysis regarding the decline 
in apparent US consumption of ripe olives during the period of investigation was not based on an 
objective examination of positive evidence.669 The European  Union  maintains that the information 
available in the Injury  Determination makes clear that any injury resulted from the decline in 
apparent consumption.670 The United  States  argues that the USITC 's findings were fully supp orted 
by the fact that the decline in apparent consumption was modest and could not account for the 
magnitude of  the reported declines in the industry 's shipments and financial performance 
indicators.671 The United  States  maintains that the USITC 's non-attribution analys is regarding the 
decline in apparent consumption was therefore based on an objective examination of positive 
evidence.672 
7.303.   The USITC 's analysis regarding  the decline in apparent consumption of ripe olives was 
summari zed as follows:  
As discussed above, apparent U.S. consumption decreased by *** percent during 2015 
to 2017. However, this relatively modest decline in apparent  U.S. consumption was 
smaller than the declines in shipments, net sales, and operating and net income 
experienced  by the domestic industry.673 
7.304.   The USITC thus concluded that the "relatively modest" decline in apparent consumption was 
not the cause of the injury to the domestic industry because the decline in apparent consumption 
was less than the declines in  (a) shipments, ( b) net sales, and ( c) operating and net income 
experienced by the domestic industry.674 
7.305.   Article  3.5 of the Anti -Dumping  Agreement  provides :  
It must be demonstrated that the dumped imports are, through the effects of dumping, 
as set forth in paragraphs  2 and 4, causing injury within the meaning of this  Agreement . 
The demonstration of a causal relationship between the dumped imports and the injury 
to the domestic industry shall be based on an examination of all relevant evidence 
before the authori ties. The authorities shall also examine any known factors other  than 
the dumped imports which at the same time are injuring the domestic industry, and the 
injuries caused by these other factors must not be attributed to the dumped imports. 
Factors which m ay be relevant in this respect include, inter alia , the volume and prices 
of imports not sold at dumping prices, contraction in demand or changes in the patterns 
of consumption, trade restrictive practices of and competition between the foreign and 
domesti c producers, developments in technology and the export performance and 
productivity of the domestic industry.  
Article  15.5 of the SCM  Agreement  is substantially similar to Article  3.5 of the 
Anti-Dumping  Agreement , with the exception that Article  15.5 conc erns "subsidized imports".  
7.306.   Article  3.5 and Article  15.5 require an investigating  authority to ascertain whether the 
dumped or subsidized imports are causing injury to the domestic industry. As part of that causation 
analysis, the investigating  authority mu st "examine any known factors other  than the [dumped or 
subsidized] imports which at the same time are injuring the domestic industry " and " the injuries 
caused by these other factors must not be attributed to the [dumped or subsidized ] imports"  
(non-attribution). Article  3.5 and Article  15.5 do not set out a specific methodology for investigating 
authorities when undertaking a non -attribution analysis. However, the methods applied by an 
 
669 European  Union's  first written submission, paras.  620-630. 
670 European  Union's  first written submission, para. 623. 
671 United  States'  first written submission, paras.  240-250. 
672 United  States'  first written submission, paras.  240-250. 
673 Injury Determination, (Exhibit  EU-5), p. 25. (fn omitted; redacted original)  
674 Injury Determination, (Exhibit  EU-5), p. 25. WT/DS 577/R  
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  investigating authority must comport with the overarching obligat ion in Article  3.1 and Article  15.1 
to undertake an objective examination based on positive evidence.  
7.307.   Relying on the analysis by the dissenting USITC commissioner , the European  Union asserts 
that "the decline in US  consumption can perfectly explain the 'sl ight' decrease of sales by 
US producers and any alleged injury  resulting therefrom".675 The European  Union asserts "the 
dissenting opinion … clearly explains" that "the factors invoked by the USITC, when looked at more 
closely and when put into their proper  economic context, do not show that it was Spanish imports 
rather than declining  US consumption that caused injury".676 The European  Union continues that 
"[o]n the basis of [the dissenting commissioner's]  explanations it becomes evident … that it was the 
decline in consumption that caused injury, if any".677  
7.308.   The dissenting commissioner's  analysis of the decline in consumption involved a 
consideration of the decline in apparent consumption against different factors to those focused on 
by the majority. The dis senting commissioner  stated that, " despite the domestic industry selling and 
shipping slightly lower volumes over the [period of investigation] , it did so at higher unit values and 
maintained steady and improving gross profitability during a period of decl ining apparent 
U.S. consumption".678 The dissenting commissioner  thus emphasi zed that the domestic 
industry 's lower sales and shipment volumes were to some extent compensated for by higher unit 
values and improved gross profitability.679  
7.309.   The panel notes that  the factual accuracy of the USITC 's finding that the decline in apparent 
consumption was less than the decline in shipments, net sales, and operating and net income 
experienced by the domestic industry  was not challenged  by the dissenting commis sioner nor by the 
European  Union in its submissions .680 We agree with previous Appellate  Body and panel reports  that 
Article  3.5 and Article  15.5 do not require that subject imports be the sole cause of injury to the 
domestic industry.681 We consider that an  objective investigating  authority could reasonably rely on 
the fact that the decline in apparent consumption was less than in other key indicators to conclude 
that the decline in consumption was not the sole cause of the injury experienced by the domestic  
industry. I n our view, then, the European  Union  has not establish ed that an objective investigating  
authority could not have determined, as the majority did, that the decline in apparent consumption 
was not the sole cause of injury to the domestic industr y. 
7.310.   The European  Union  alleges that the USITC failed to give proper consideration to certain 
facts observed by the dissenting commissioner , in particular the increase in unit values of domestic 
shipments during the period of investigation682 and that the "do mestic industry 's gross income as a 
ratio to net sales actually increased during the [period of investigation] ".683 However, no substantive 
argument was presented to the Panel explaining why an objective investigating  authority would have 
to give these factors the weight accorded to them by the dissenting commissioner  when conducting 
the non -attribution analysis of the decline in apparent consumption.  
7.311.   Without wishing to overstate the point, w e recall that the mere fact that a dissenting  view 
exists does not establish that the majority 's findings were not based on an objective examination of 
positive evidence.684 Absent any persuasive reasons to conclude that an objective investigating  
authority would necessarily have cons idered the domestic industry 's higher unit values and improved 
gross profitability when conducting the non -attribution analysis, and have concluded that the injury 
could not be attributed to the dumped and subsidized imports, our view is that the 
European  Union's  argument fails.  
 
675 European  Union's  first written submission, para. 628 (referring to Injury Determination, 
(Exhibit  EU-5), p. 32 (dissenting view)).  
676 European  Union's  first written submissio n, para. 623. 
677 European  Union's  first written submission, para. 623. (fn omitted ) 
678 Injury Determination, (Exhibit  EU-5), p. 32 (dissenting view). 
679 Injury Determination, (Exhibit  EU-5), p. 32 (dissenting view). 
680 Injury Determination, (Exhibit  EU-5), p.  25. 
681 Appellate  Body Reports, US – Wheat Gluten , para. 67; US – Line Pipe , para. 209. See also Panel 
Report, China – Autos (US) , para. 7.322.  
682 Injury Determination, (Exhibit  EU-5), p. 32 (dissenting view). 
683 European  Union's  first written submission, para. 626 ( referring to  Injury Determination, 
(Exhibit  EU-5), p. 32 (dissenting view)). 
684 See para.  7.216  above.  WT/DS577/R  
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  7.4.7.2   Whether the USITC 's non-attribution analysis of non -subject imports from 
Morocco was not based on an objective examination of positive evidence in violation of 
Articles  3.1 and 3.5 of the Anti -Dumping  Agreement  and Articles  15.1 and  15.5 of the 
SCM Agreement  
7.312.   The European  Union  claims that the USITC 's non-attribution analysis regarding non -subject 
imports from Morocco was not based on an objective examination of positive evidence.685 In 
particular, the European  Union  argues that an obj ective investigating  authority would attribute injury 
to the increase of non -subject imports from Morocco over the period of investigation.686 The 
United  States  argues that the USITC 's findings were supported by the absence  of non -subject 
imports from Morocco  in the retail sector, and the comparatively small overall volume of Moroccan 
ripe olives.687 The United  States  thus maintains that the USITC 's analysis was based on an objective 
examination of positive evidence.688 
7.313.   The USITC 's non-attribution analysis regarding non -subject imports from Morocco was 
summari zed as follows:  
While nonsubject imports were generally the lowest ‐priced and captured market share 
from both the domestic industry and subject imports, subject imports had a 
substantially larger presence in the U.S. market than nonsubject imports throughout 
the [period of investigation] . Moreover, the record indicates that nonsubject imports 
captured market share from subject imports in the institutional sector of the U.S.689 
7.314.   The European  Union  argues that the "available import figures make crystal clear that it was 
the significant increase in non -subject imports that caused injury to the domestic industry, if any, 
not the decreasing Spanish imports".690 The European  Union  finds support for this argument in data 
drawn from the records of relevant harmonized tariff schedule codes on the USITC 's Dataweb 
platform.691 A table contained in the European  Union's  first written submission and based on these 
data shows that Spanish imports decreased by 6.44% during the period of investigation,  while 
Moroccan imports increased 100.28%  (from a significantly lower base ).692 The United  States , in 
contrast, asserts that Mo roccan imports increased less than  20% during the period of 
investigation.693 
7.315.   We do not consider the fact that Spanish imports decreased while Moroccan imports 
increased at a whole market level implies that an objective investigating  authority could not hav e 
attributed the loss of market share identified in the retail sector resulting from underselling by 
Spanish imports and consequent deterioration of certain economic indices. While Moroccan imports 
increased during the period of investigation, the absolute  volume of non -subject imports was less 
than subject imports. Even relying on the higher rate of increase asserted by the European  Union , 
Moroccan imports increased only from 5,633 tonnes  to 11,282 tonnes  during the period of 
investigation.694 This volume w as far below that of Spanish ripe olives, even with Spanish imports 
per annum declining from 35,037 tonnes  to 32,782 tonnes  across the period of investigation.695 
Furthermore, the USITC observed that increasing Moroccan imports captured market share from 
Spanish ripe olives in the institutional sector, not from domestic ripe olives in the retail sector.696 
We thus consider that an objective investigating  authority could have arrived at the 
 
685 European  Union's  first wr itten submission, paras.  631-638. 
686 European  Union's  first written submission, para. 633. 
687 United  States'  first written submission, paras.  252-258. 
688 United  States'  first written submission, paras.  252-258. 
689 Injury Determination, (Exhibit  EU-5), p. 25. (fns omitted ) 
690 European  Union's  first written submission, para. 636. 
691 European  Union's  first written submission, para. 633 ( table 2: Import sources during the POI (short 
tonnes dry weight)).  
692 European  Union's  first written submission, para. 633 ( table 2: Import sources during the POI (short 
tonnes dry weight)).  
693 United  States'  13 April 2021 comments on European  Union's  26 March  2021 response to Panel 
question No.  3, para.  20. 
694 European  Union's  first written s ubmission, para. 633 ( table 2: Import sources during the POI (short 
tonnes dry weight)).  
695 European  Union's  first written submission, para. 633 ( table 2: Import sources during the POI (short 
tonnes dry weight)).  
696 Injury Determination, (Exhibit  EU-5), pp.  25-26. WT/DS 577/R  
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  USITC 's conclusion, regardless of whether the increase in volume of Mo roccan imports was 
consistent with the figures presented by the United  States  or the European  Union .697 
7.316.   The European  Union  also argues that the USITC 's observation that "the record indicates that 
nonsubject imports captured market share from subject imports in the institutional sector" does not 
support the USITC 's finding that Moroccan imports did not cause injury to the domestic industry.698 
In particular, the European  Union  argues that, for purposes of establishing causation, it is "irrelevant 
that M oroccan imports are mostly present in the institutional/food channel" because "Moroccan ripe 
olives are substitutable  with domestic ripe olives".699 This argument relies on the 
European  Union's  assertion that "Spanish  imports cannot have caused injury to th e domestic 
industry through market share losses" while non -subject imports "increased massively", were 
"cheaper", and were acknowledged by the USITC as having taken market share from both the 
domestic industry and subject imports.700 We recall, however, tha t Article  3.5 and Article  15.5 do 
not require that subject imports be the sole cause of injury to the domestic industry.701 We are 
further of the view that an objective investigating  authority could find that evidence that increasing 
Moroccan imports captur ed market share in a sector in which the domestic industry had relatively 
few sales reasonably supports the USITC 's conclusion. Consequently, we see no grounds to find that 
the USITC's  consideration of non -subject imports was inconsistent with Articles  3.1 and 3.5 of the 
Anti-Dumping  Agreement and Articles  15.1 and 15.5 of the SCM  Agreement . 
7.4.7.3   Conclusion on the USITC 's causation analysis under Articles  3.1 and 3.5 of the 
Anti-Dumping  Agreement  and Articles  15.1 and 15.5 of the SCM  Agreement  
7.317.   For the reasons ab ove, we find that the  European  Union has not demonstrated that the  
USITC 's non-attribution analysis of the decline in apparent consumption was  not based on an 
objective examination of positive evidence. We further find that the European  Union has not 
established that the  USITC 's non-attribution analysis of non -subject imports was not based on an 
objective examination of positive evidence. We thus find that European  Union  has not demonstrated 
that the USITC 's causation analysis was inconsistent with Articles 3.1 and 3.5 of the 
Anti-Dumping  Agreement  and Articles  15.1 and 15.5 of the SCM  Agreement . 
7.4.8   Consequential claims  
7.318.   In addition to its substantive arguments, the European  Union  argues that each of its 
allegations concerning the USITC 's volume and price e ffects analyses resulted in consequential 
violations in subsequent parts of the USITC 's injury investigation.702 Having found that the 
European  Union has failed to establish the merits of its substantive arguments concerning the 
USITC 's analysis of volume a nd price effects , we similarly find that the 
European  Union's  consequential claims must also fail.  
7.4.9   Conclusion in relation to the USITC 's Injury Determination  
7.319.   For the reasons above, we thus conclude that the European  Union  has not demonstrated 
that the USITC 's Injury Determination violated Articles  3.1, 3.2, 3.4 , and 3.5 of the 
Anti-Dumping  Agreement  or Articles  15.1, 15.2, 15.4 , and 15.5 of the SCM  Agreement . 
 
697 We note that the European  Union also alleges that non -subject imports from sources other than 
Morocco also increased during the period of investigation from 6,169 tonnes to 7,030 tonnes. 
(European  Union's  first written submission, para.  633 (Table  2: Import sources during the POI (short tonnes 
dry weight))). We do not consider that this relatively small increase in non -subject imports from sources other 
than Morocco could establish that the USITC's  non-attribution analysis was not based on an  objective 
examination of positive evidence, either by itself or in combination with the increase in Moroccan imports 
alleged by the European  Union.  
698 European  Union's  second written submission, para. 191. 
699 European  Union's  second written submission, para. 191. 
700 European  Union's  second written submission, para. 192. 
701 Appellate  Body Reports, US – Wheat Gluten , para. 67; US – Line Pipe , para. 209. See also Panel 
Report, China – Autos (US) , para. 7.322.  
702 In relation to the USITC 's volume analysis, see : European  Union's  first written submission, 
paras.  493, 512, 518, 560, 564 -565, 600, and 610. In relation to the USITC 's price effects analysis, 
see: European  Union's  first written submission, paras.  539, 551, 557, 560, 564 -565, 600, and 610.  WT/DS577/R  
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  7.5  The European  Union's  claims  concerning  Aceitunas  Guadalquivir's  final subsidy  
margin  and countervailing  duty rate calculation  
7.5.1   Introduction  
7.320.   In this section the Panel  address es the European  Union's  claims concerning the 
USDOC 's calculation of the final subsidy margin and countervailing duty rate for one of the 
three  individually examined respond ents, Aceitunas Guadalquivir . The focus of the 
European  Union's  complaint is the USDOC's  decision to rely upon information reported in Aceitunas 
Guadalquivir 's response to the initial exporter's  questionnaire to represent different  values  in the 
calculatio n of Aceitunas Guadalquivir 's preliminary and final subsidy margin and countervailing duty 
rate. 
7.321.   In its preliminary determination , the USDOC calculated the subsidy margin and 
countervailing duty rate  of each respondent by multip lying the weighted average per kilogram  
benefit by the volume of purchases of raw olives , regardless  of end-use (the numerator), and then 
dividing that amount by sales of olives and olive products.703 The USDOC determined Aceitunas 
Guadalquivir 's numerator by re lying upon the volume of raw olive purchases r eported by Aceitunas 
Guadalquivir  in response to the USDOC 's initial 4  August  2017 questionnaire. The USDOC modified 
its calculation methodology in the final determination . In particular, the USDOC calculated t he 
subsidy margin and countervailing duty rates by multiplying the weighted  average per kilogram 
benefit by the volume of raw olives used to produc e subject  merchandise , and then dividing that 
amount by sales of subject merchandise .704 For Aceitunas Guadalquivir , the USDOC once again used 
the volume of raw olive purchases reported by Aceitunas Guadalquivir  in the 4  August  2017 
questionnaire in calculating the numerator.  
7.322.   The European  Union  argues, as Aceitunas Guadalquivir  did in the investig ation705, that the 
USDOC 's initial 4  August  2017 questionnaire , properly understood , asked the respondents to report  
their total  volume of raw olive purchases regardless  of end-use, not the narrower sub category of 
raw olive purchases processed  into subject  merchandise .706 The European  Union  argues that the 
USDOC 's actions after the 4  August  2017 questionnaire – including a 27  September  2017 request 
for the respondents to resubmit information regarding their suppliers of raw olives , and the 
USDOC 's decision in its preliminary determination  to calculate subsidy margins for the respondents 
based on raw olive purchases regardless of end -use707 – show that Aceitunas Guadalquivir  was 
correct in its understanding of the scope of the questions contained in the initial questionnaire.708 In 
these circumstances, the European  Union claims that the USDOC's  final calculation of Aceitunas 
Guadalquivir 's subsidy margin and countervailing duty rate was inconsistent with Article  VI:3 of 
the GATT  1994 and Articles  10, 19.1,  19.3, 19.4 , and 32.1 the SCM  Agreement , and that the USDOC 
failed to comply with the procedural obligations under Articles  12.1 and 12.8 of the  SCM Agreement 
in relation to that calculation.709 The European  Union further claims consequential violations of 
Article  VI:3 of the  GATT  1994 and Articles  10, 19.1, 19.3, 19.4 , and 32.1 of the SCM  Agreement due 
to the USDOC's  reliance on Aceitunas Guadalquivir 's final subsidy margin in calculating the "all 
others " rate applied to all exporters and producers that were not individually investigated.710 
7.323.   The United  States argues that the European  Union's  claims rely upon an incomplete 
presentation of the factual record. Contrary to European  Union's  assertions, the Unite d States 
maintains that, in the initial 4  August  2017 questionnaire, the USDOC expressly requested each 
mandatory respondent to report purchases of raw olives used to produce  ripe olives  and, prior to 
the final determination , made clear that this was an es sential fact under consideration. In doing so, 
the United  States argues that the record reflects that the USDOC evaluated the evidence supplied 
 
703 PIDM, (Exhib it EU-1), p.  17; Aceitunas  Guadalquivir  preliminary determination , (Exhibit  EU-36), 
pp. 2-3.  
704 FIDM, (Exhibit  EU-2), p.  44. 
705 FIDM, (Exhibit  EU-2), p.  41; Ministerial error memorandum, (Exhibit  EU-69), p.  3. 
706 European  Union's  first written submission, pa ra. 698. 
707 PIDM, (Exhibit  EU-1); Aceitunas Guadalquivir  preliminary determination , (Exhibit  EU-36), p.  2. 
708 European  Union's  first written submission, paras.  699-704. 
709 European  Union's  first written submission, paras.  639-728. 
710 European  Union's  first written submission, paras.  729-730. WT/DS 577/R  
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  by Aceitunas Guadalquivir  in an unbiased and objective manner and satisfied all notice and disclosure 
requiremen ts.711 
7.324.   We begin by examining the European  Union's  substantive claims  concerning the 
USDOC's  calculation of Aceitunas Guadalquivir 's final subsidy margin and countervailing duty rate, 
before turning to address the European  Union's  procedural claims.712 
7.5.2   The USDOC's  calculation  of Aceitunas Guadalquivir 's final subsidy  margin  and 
countervailing  duty rate 
7.325.   The European  Union asserts that the USDOC improperly based its calculation of Aceitunas 
Guadalquivir 's final subsidy margin and corresponding countervailing duty rate  on Aceitunas 
Guadalquivir 's reported volume of purchases of raw olives, regardless of end -use, which was a 
purportedly larger volume than its purchases of raw olives processed into the subject merchandise , 
being  ripe olives. The European  Union  claims that, in doing so, the USDOC  acted inconsistently with 
Article  VI:3 of the  GATT  1994 and Article  19.4 of the SCM  Agreement , and consequently, 
Articles  19.1 and 32.1 of the SCM  Agreement , because the USDOC failed to calculate precisely t he 
amount of the subsidy granted on the imported  product, leading the USDOC to impose countervailing 
duties on Aceitunas Guadalquivir  in excess of what was required to offset the  subsidies granted.713 
Moreover, to the extent that the USDOC's calculation  is based on Aceitunas Guadalquivir 's reported 
volume of purchases of raw olives, regardless of end -use, the European  Union asserts that the 
calculation of Aceitunas Guadalquivir 's countervailing duty rate differs from the calculation of the 
rates imposed on t he mandatory respondents Agro Sevilla and Ángel Camacho without any 
justification, and thus is inconsistent with the requirement in Article  19.3 of the SCM  Agreement to 
apply countervailing duties on a non -discriminatory basis.714 Finally, the European  Union also claims 
that th e USDOC 's approach to calculating the countervailing duty rate for Aceitunas Guadalquivir  
also violates the obligation contained in Article  10 of the SCM  Agreement  to "take all necessary 
steps"  to ensure that the imposition of the duti es complies with Article  VI:3 of the  GATT  1994 and 
the SCM  Agreement .715 
7.326.   The United  States argues that the record of the investigation refutes each of the 
European  Union's  claims. The United  States argues that the USDOC, in its initial 4  August  2017 
questionnaire, requested from each mandatory respondent (including Aceitunas 
Guadalquivir ) purchase information for their raw olives processed into ripe olives. The United  States 
contends that the USDOC used the information that each respondent report ed in response to the 
USDOC's  questionnaire to calculate the final subsidy rate for each respondent. In this way, the 
United  States contends that the USDOC used a uniform calculation method to calculate each 
respondent's  final subsidy rate and that the USD OC provided a reasoned and adequate explanation, 
based on positive record evidence, to support using the purchase information submitted by each of 
the three companies.716 
7.327.   The United  States  further contends that the European  Union  has not raised any of its 
arguments in the context of Article  14 of the SCM  Agreement  and therefore has not properly 
challenged the method for determining the subsidy "amount" in the determination at issue. In this 
regard, the United  States  argues that Article  14 of the SCM  Agreemen t "speaks directly to the notion 
of calculating the amount of benefit in terms of the benefit to the recipient", and thus provides 
substantive rules against which "the appropriate amounts in each case" discussed in Article  19.3 
 
711 United  States'  first written submission, para.  260. 
712 We note that, although the European  Union's  panel request also refers to Articl e 12.5 of the 
SCM Agreement, the European  Union did not subsequently pursue a claim under this provision in its 
submissions to the Panel.  We therefore do not address this provision in our findings.  (European  Union's  panel 
request, p.  2). 
713 European  Union's  first written submission, paras.  706-707. See also ibid. paras.  683 and 689.  
714 European  Union's  first written submission, para. 708. 
715 European  Union's  first written submission, para. 710. 
716 United  States'  first written submission, para.  288. WT/DS577/R  
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  may be understood.717 By fail ing to raise any of its arguments in the context of Article  14, the 
United  States  contends that the European  Union's  complaint must fail.718 
7.328.   We begin by addressing the United  States'  assertion that the European  Union  has not 
properly challenged the USDOC 's determination of Aceitunas Guadalquivir 's subsidy margin by 
failing to raise a claim under Article  14 of the SCM  Agreement . 
7.5.2.1   The legal  basis  of the European  Union's  claims  in relation  to the calculation  of 
Aceitunas Guadalquivir 's subsidy  margin  and countervailing  duty rate 
7.329.   The United  States  argues that the European  Union  has not properly challenged the 
USDOC 's determination of Aceitunas Guadalquivir 's subsidy amount because the relevant provision 
under the SCM  Agreement  governing such calculations is  Article  14, which the European  Union  has 
not relied upon. The United  States maintains that Article  19.4 of the SCM  Agreement and Article  VI:3 
of the  GATT  1994, which are the main legal bases of the European  Union's  claims, do not dictate 
precisely how an investigating authority should determine the appropriate denominator for a given 
numerator when calculating countervailing duty ratios. Rather, the United  States maintains that 
these provisions only prescribe that the elements of the numerator and denomina tor must be 
determined so as to ensure that the level of duty does not exceed the amount of subsidy, in terms 
of subsidization per unit.719 Similarly, the United  States contends that the other provision the 
European  Union relies upon, Article  19.3 of the SC M Agreement, does not speak to the substantive 
issue of what a subsidy is and how a benefit is found to exist.720  
7.330.   The European  Union  disagrees that it needed to bring a claim under Article  14 of the 
SCM Agreement in order to challenge the USDOC's  calculati on of Aceitunas Guadalquivir 's subsidy 
margin , arguing that a determination of the amount of a subsidy benefit can comply with the specific 
guidelines in Article  14 but nonetheless contravene other disciplines, such as those in Article  VI:3 of 
the GATT  1994 or Article  19 of the SCM  Agreement . Thus, insofar as the USDOC 's determination is 
inconsistent with other  disciplines such as the calculation of benefit, there was no requirement for 
the European  Union  to bring a claim under Article  14.721 
7.331.   We note that Article  14 sets out disciplines and guidelines for the calculation of the amount 
of a subsidy in terms of benefit to the recipient. The chapeau  to Article  14 provides in general terms 
that "any method used" to determine the benefit to the reci pient shall be provided for in national 
legislation or implementing regulations; that the application of that method shall be transparent and 
adequately explained; and that the method must be consistent with the guidelines in 
subparagraphs  (a)-(d).722 These  guidelines concern the following six types of financial 
contributions : government provision of equity capital, a government loan , a loan guarantee  by a 
government , and the provision of goods and services or purchase of goods  by a government . We 
see nothin g in the terms of the chapeau  of Article  14, or in the guidelines it prescribes, to suggest 
that it was intended to exhaustively define the Members ' obligations with respect to the 
determination of the amount of a subsidy benefit. For example, Article  14 does not provide specific 
guidance with respect to how to determine the amount of a subsidy provided in the form of a grant 
to a recipient that produces input products alleged to indirectly subsidiz e a downstream imported 
processed product, which is the iss ue we are confronted with in this dispute. In this regard, we recall 
 
717 United  States' first written submission, para.  298. The United  States  contends that Article  19 of the 
SCM Agreement  is concerned with the primarily ministerial function of imposing and collecting countervailing 
duties once those duties are already calculated and det ermined in accordance with the obligations imposed by 
the preceding articles of the SCM  Agreement . (United  States'  12 November  2020 response to Panel question 
No. 15, paras.  46-49). 
718 United  States'  first written submission, para.  298; second written submission, paras.  105-107. 
719 United  States'  first written submission, para.  294 (referring to Appellate  Body Report,  US – Washing  
Machines , para.  5.269 ( "[w]ithin these confines, the SCM  Agreement does not dictate any particular 
methodology for calculating subsidy ratios, and does no t specify explicitly which elements should be taken into 
account in the numerator and the denominator."))  
720 United  States'  first written submission, paras.  296-297. See also United  States'  12 November  2020 
response to Panel question No. 15, para. 46 ("Article 19 is concerned with the primarily ministerial function of 
imposing and collecting [countervailing duties]  once those  duties  are already  calculated  and determined  in 
accordance with the obligations imposed by the preceding articles of the SCM  Agreement . Article  19 does not 
impose substantive requirements with respect to an investigating authority 's calculation and determination of a 
[countervailing duty]  rate" (emphasis original)).  
721 European  Union's  12 November  2020 response to Panel question  No. 41, paras.  215-218. 
722 Appellate  Body Report, Japan  – DRAMS  (Korea) , para. 190. WT/DS 577/R  
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  our previous finding that under the terms of Article  VI:3, an investigating authority considering how  
to countervail indirect subsidies must analyse whether and to what extent  subsidies o n inputs may 
have indirectly flowed to the processed product and, thereby, be included in the determination  of 
the total amount  of subsidies  bestowed on the investigated product.723 An investigating authority is 
required to make this determination in order to ensure that countervailing duties are not applied in 
an amount that is in excess of the estimated subsidy determined to have been granted to the 
investigated product. To this ex tent, we agree with previous Appellate  Body reports  that, under the 
terms of Article  VI:3, an investigating authority is required to ascertain as accurately as possible the 
amount of subsidization bestowed on the investigated products  to ensure that counte rvailing duties 
are not applied in excess of the subsidization of the subsidized product  on the per unit basis 
adopted .724 
7.332.   Thus, we agree with the European  Union  that it was not required to bring a claim under 
Article  14 of the SCM  Agreement  in challenging the USDOC 's determination of Aceitunas 
Guadalquivir 's subsidy amount and corresponding countervailing duty rate. Accordingly, we see no 
reason to reject the European  Union's  claims simply because they were not raised under Article  14 
of the SCM  Agreement . 
7.5.2.2   Whether  the USDOC  properly  determined  Aceitunas Guadalquivir 's subsidy  
margin  and corresponding  countervailing  duty rate 
7.333.   The European  Union  claims that the USDOC incorrectly determined Aceitunas 
Guadalquivir 's final subsidy margin and corresponding countervailing duty rate when it used 
Aceitunas Guadalquivir 's reported volume of purchases of raw olives, regardless  of end-use – a 
purportedly larger volume of purchases than the volume of raw olive purchases used to proc ess the 
subject merchandise. According to the European  Union , the USDOC 's reliance on this value in this 
way led it to erroneously calculate the numerator of Aceitunas Guadalquivir 's final subsidy 
calculation, which the USDOC sought to determine by multipl ying the weighted average per kilogram  
benefit by the volume of purchases of raw olives that were processed  into ripe olives .725 In the 
denominator of the calculation, the USDOC used Aceitunas Guadalquivir 's sales of ripe olives.726 
Thus, the European  Union  contends that the resulting final margin and corresponding countervailing 
duty rate is "excessive and inappropriate ".727 
7.334.   As we did in relation to the European  Union's  complaint against the USDOC 's determination 
of pass -through, we begin our a ssessment of the European  Union's  claims with respect to the 
USDOC's  calculation of Aceitunas Guadalquivir 's final subsidy margin and countervailing duty rate 
by focusing on Article  VI:3 of the  GATT  1994. We recall that Article  VI:3 of the  GATT  1994 provid es: 
No countervailing duty shall be levied on any product of the territory of any contracting 
party imported into the territory of another contracting party in excess of an amount 
equal to the estimated bounty or subsidy determined to have been granted, di rectly or 
indirectly, on the manufacture, production or export of such product in the country of 
origin or exportation, including any special subsidy to the transportation of a particular 
product. The term "countervailing duty" shall be understood to mean a special duty 
levied for the purpose of offsetting any bounty or subsidy bestowed, directly, or 
indirectly, upon the manufacture, production or export of any merchandise.728 
7.335.   Article  VI:3 establishes that WTO Members may levy duties that "offset " subsidies in an 
amount not in excess of the estimated subsidy determined to have been granted, directly or 
indirectly, on the manufacture, production, or export of a product. Thus, und er the terms of 
Article  VI:3, an unbiased and objective investigating authority  must ensure , and take the necessary 
 
723 See section  7.3.1.1  above.  
724 Appellate  Body Reports,  US – Countervailing Measures on Certain EC Products , para. 139; US – 
Washing  Machines , para. 5.268.  
725 FIDM, (Exhibit  EU-2), pp. 43 -44; see also Aceitunas Guadalquivir  final determination , 
(Exhibit  EU-41), p. 2; Extract from Aceitunas Guadalquivir  final calculation data , (Exhibit  EU-47 (BCI)); and 
Extract from Aceitunas Guadalquivir  final calculation data, tab BPS Growers , (Exhibit  EU-76). 
726 FIDM, (Exhibit  EU-2), pp. 43-44; see also Aceitunas Guadalquivir  final determination, 
(Exhibit  EU-41), p. 2; Extract from Aceitunas Guadalquivir  final calculation data , (Exhibit  EU-47 (BCI)); and 
Extract from Aceitunas Guadalquivir  final calculation data, tab BPS Growers , (Exhibit  EU-76). 
727 European  Union's  first written submission, para.  706. 
728 Fn omitted . WT/DS577/R  
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  steps to ascertain as accurately as possible the amount of subsidization bestowed on the investigated 
products . In our view, this implies th at an investigating authority's  subsidy margin and 
countervailing duty calculations must be based on appropriate input values  that are as  accurate as 
possible . We examine whether the USDOC fulfilled this requirement when it relied  upon the volume 
of raw olive purchases reported in Aceitunas Guadalquivir 's 4 August  2017 questionnaire response, 
to determine its final subsidy margin and countervailing duty rate . 
7.336.   The parties disagree as to what information the USDOC solicited from the respon dents in its 
initial 4  August  2017 questionnaire. They have also expressed different views about the nature of 
the raw olive purchases information Aceitunas Guadalquivir  reported, as well as the extent to which 
subsequent USDOC requests for information and  verification of Aceitunas 
Guadalquivir 's questionnaire responses clarify and confirm the nature of Aceitunas 
Guadalquivir 's reported purchases information.  
7.5.2.2.1   The USDOC 's initial  4 August  2017  questionnaire  
7.337.   The European  Union argues that Aceitunas Guadalquiv ir correctly understood the 
4 August  2017 questionnaire729 as requesting information about the volume of raw olive purchases 
regardless of the processed olive product for which the raw olives were used .730 Although the 
European  Union acknowledges that the co ver letter of the 4  August  2017 questionnaire instructs the 
respondents to provide the "requested information on your company's  sources of raw olives that 
were processed  into ripe olives "731, the European  Union  asserts that the specific questions that 
followed (contained in  attachment I to the questionnaire)  were entitled "Sources of Raw and Ripe 
Olives" and did not direct the respondents to limit or separately report data with respect to the 
volume of raw olives purchas ed that are processed into ripe olives.732 
7.338.   The cover letter to the 4  August  2017 questionnaire describes the purpose behind the 
USDOC 's initial enquiry  in the following terms : 
The [USDOC]  asks that you respond to the questions outlined in Attachment I to th is 
letter and provide the requested information on your company's  sources of raw olives 
that were processed into ripe olives  during the period of investigation (POI ) 
January  1, 2016, through December  31, 2016.733 
7.339.   This statement from the cover letter suggest s that the USDOC was seeking information on 
the sources of raw olives used for ripe olive processing.  At the same time, we note that the relevant 
questions attached to the cover letter were not drafted with the same distinction or qualification  and 
did not direct the respondents to provide the volume of raw olives purchased that were used to 
process  ripe olives . The United  States argues that the "relevant"734 question in this regard, was 
question 6 of the 4  August  2017 questionnaire. This question set out as follows735: 
If your company processes ripe olives and obtains its raw olives from suppliers  that are 
affiliated with, but separately incorporated from your company or from suppliers that 
are not affiliated with your company, please complete the attached "Template for 
 
729 The USDOC's  4 August  2017 questionnaire and accompanying cover  letter to Aceitunas Guadalquivir 
are contained in: Letter to Aceitunas Guadalquivir  on questionnaire, (Exhibit  EU-58). See also Letter to 
Agro Sevilla on questionnaire , (Exhibit  USA-6); and Letter to Ángel Camacho on questionnaire , 
(Exhibit  USA-7). 
730 European  Union's  first written submission, paras.  697 and 716; second written submission , 
para. 195. Thus, the European  Union argues that "it cannot be argued that the data used by USDOC [to 
calculate Aceitunas Guadalquivir's  subsidy] was ever indicated by [Aceitunas]  Guadalquivir as being the volume 
of raw olives processed into ripe olives ". (European  Union's  first written submission, para. 695). 
731 European  Union's  first written submission, paras.  643 and 698 (emphasis added). We note that this 
is also the position of the United  States. (United  States'  first written submission, paras.  276-277 (referring to 
Letter to Aceitunas Guadalquivir  on questionnaire, (Exhibit  EU-58), p.  1)). 
732 European  Union's  first written submission, paras.  643 and 698. 
733 Letter to Aceitunas Guadalquivir  on questionnaire , (Exhibit  EU-58), p. 1 (emphasis added) . See also 
Letter to Agro Sevilla on questionnaire , (Exhibit  USA-6); and Letter to Ángel Camacho on questionnaire , 
(Exhibit  USA-7). 
734 United  States'  first written submission, para. 276. 
735 Letter to Aceitunas Guadalquivir  on questionnaire , (Exhibit  EU-58), at tachment I.  WT/DS 577/R  
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  Suppliers of Raw Olives," to include all of those suppliers . Please be sure to indicate 
whether the supplier(s ) might be considered cross -owned with your company.736  
7.340.   On its own, we do not understand this question to have direct ed the responde nts to report 
the volume of purchases of raw olives processed into ripe olives. Rather, what is required by this 
question is information about the suppliers of raw olives, in accordance with the "Template for 
Suppliers of Raw Olives". That template did not  ask the respondents to distinguish and separately 
report data with respect to the volume of raw olives purchased to process ripe olives  and the volume 
of raw olive purchased for any end -use.737 Rather, the heading in this template concerning the 
volume of purchases simply calls for data about the "volume of raw olives purchased", without 
distinction or qualification.738  
7.341.   We recognize, however, that when read in conjunction with the cover letter, a respondent 
could well have understood question 6 to be asking  for information about raw olive purchases that 
were used to process ripe olives. T his appears to have been the understanding of two of the three 
mandatory respondents, Agro Sevilla and Ángel  Camacho , who initially submitted only information 
on volumes of purchases of raw olives used to produce ripe olives .739 Nevertheless, in our view, the 
fact that "Template for Suppliers of Raw Olives" simply asked for data on the "volume of raw olives 
purchased", without distinction or qualification, means that question 6 could have also been 
reasonably understood as asking for the volume of raw olives purchased, regardless of end -use.  
7.342.   The remaining questions  in the 4 August  2017 questionnaire seeking purchase and 
production information are framed in a similar ly general  manner, and do not indicate whether 
information about purchases or production of raw olives must be limited to raw olives used to process 
into ripe olives. Question 7 provides:  
If your company processes ripe olives  and you have no suppliers that are separa tely 
incorporated or unaffiliated, please confirm that the raw olives your company processes 
into ripe olives are produced within your company  (that is, none of your suppliers are 
separately incorporated ) and report the quantity of raw olives produced by y our 
company . If not, please explain the sources of the raw olives you process .740 
7.343.   Question 8 provides:  
If your company processes ripe olives  and produces raw olives, but you also have 
outside suppliers of raw olives, please complete the attached "Template for Suppliers of 
Raw Olives," for your outside purchases. Please also report the quantity of raw olives 
produced by your company .741 
7.344.   Both questions 7 and 8 sought information from responding companies that processed ripe 
olives from raw olives produced in -house. The first instruction in question 7 directs such companies 
to "confirm that the raw olives your company processes into ripe olives are produced within your 
 
736 Original emphasis omitted; e mphasis added . 
737 Aceitunas Guadalquivir  response to the sourcing questionnaire , (Exhibit  EU-63); Agro Sevilla 
response to the sourcing questionnaire (public version) , (Exhibit  EU-17); and Ángel Camacho response to the 
sourcing questionnaire (public version) , (Exhibit  EU-68). 
738 Reporting template for processors of ripe olives , (Exhibit  EU-61). 
739 In its response to the 27  September  2017 request (discussed below), Agro Sevilla submitted updated 
information to the USDOC, delineating between "[v]olume of Black Olives Purchased " (i.e. for purchases of raw 
olives processed into ripe olives ) and "[v]olume of Green Olives Purchased " (i.e. for purchases of raw olives 
processed into other olive products ). (Agro Sevilla revised olive sourcing data , (Exhibit  EU-65 (BCI)); Agro 
Sevilla revised olive sourcing data (public version) , (Exhibit  EU-79)). Ángel  Camacho submitted updated 
information also  delineating between "[q]uantity Raw for Ripe " (i.e. for purchases of raw olives processed into 
ripe olives ) and a column labelled "[q]uantity Raw for No Ripe " (i.e. for purchases of raw olives processed into 
other olive products ). (Ángel Camacho revised o live sourcing data , (Exhibit  EU-64 (BCI)); Ángel Camacho 
revised olive sourcing data  (public version), (Exhibit  EU-78)). For both Agro Sevilla and Ángel  Camacho, figures 
for raw olives processed into ripe olives in their 27  September  2017 responses align with figures reported in 
response to the USDOC 's 4 August  2017 questionnaire. (See also Agro Sevilla response to the sourcing 
questionnaire , (Exhibit  EU-42 (BCI) ); Agro Sevilla response to the sourcing questionnaire  (public version) , 
(Exhibit  EU-17); Ángel  Camacho response to the sourcing questionnaire , (Exhibit  EU-44 (BCI) ); and 
Ángel  Camacho response to the sourcing questionnaire  (public version) , (Exhib it EU-68)). 
740 Letter to Aceitunas Guadalquivir  on questionnaire , (Exhibit  EU-58), attachment I. (e mphasis added ) 
741 Letter to Aceitunas Guadalquivir  on questionnaire , (Exhibit  EU-58), attachment I. (e mphasis added ) WT/DS577/R  
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  company". This initial part of question 7 clearly states that the information the USDOC was 
requesting concerned in -house production of raw olives processed  into ripe olives . In contrast, the 
second part of question 7 is expressed in more general terms, simply asking companies to report 
the "quantity of raw olives produced by your company". While it is possible to read this second 
instruction, in the light of the first, to be limited to raw olives processed into ripe olives, the fac t that 
the USDOC decided not to specify, for example, that it was requesting information on the "quantity 
of raw olives produced [for this purpose] by your company", leaves open another reasonable 
interpretation – that is, that the USDOC wanted companies t o report the volume of raw olives 
produced in -house for any end -use. In our view, question 8 offers even less clarity in this regard, 
as it simply asks for relevant respondent companies to complete the same template as question 6 
(which we recall did not d istinguish between end -uses for which raw olives were processed), and to 
report the "quantity of raw olives produced by your company", without distinction or qualification. 
Thus, we find that questions 7 and 8 do not help a reasonable respondent  to underst and whether 
the purchase information the USDOC requested in question 6 was limited to the volume of raw olives 
processed into ripe olives. In this respect, we find these questions to be as unspecific as question 6.  
7.345.   Thus, we disagree with the United  States that the 4  August  2017 questionnaire clearly  
identified that the USDOC was requesting the respondents to report purchase information for raw 
olives processed into ripe olives.742 
7.346.   The United  States argues that the USDOC had no obligation to investiga te wheth er Aceitunas 
Guadalquivir  provided different information than what the USDOC had allegedly asked for in the 
4 August  2017 questionnaire, and that Aceitunas Guadalquivir  should have asked for clarification if 
it considered the questionnaire was ambiguous. In this connection, t he United  States  refers to the 
cover page of the questionnaire, which instruct ed respondents to consult with the officials in charge 
if there were questions during the investigation. Thus, according to the United  States, n ot having 
received questions from Aceitunas Guadalquivir  regarding its request  for information , an unbiased 
and objective investigating authority could have concluded, as the USDOC did, that the information 
submitted by Aceitunas Guadalquivir  in response to the 4 August  2017 questionnaire represented 
the company 's purchases of raw olives that were processed into ripe olives.743 
7.347.   We agree with the underlying concern raised by the United  States and accept that an 
investigated company should consult with officials to clarify any doubts about its understanding of 
information it is expected to provide. However, given our view that the 4  August  2017 questionnaire 
could have been reasonabl y interpreted by Aceitunas  Guadalquivir  in the way it was, there was no 
reason for Aceitunas Guadalquivir  to have recognized that there was any ambiguity or to have sought 
clarification. The absence of any request on the part of Aceitunas Guadalquivir for clarification of 
question 6 of the 4  August  2017 questionnaire says nothing about the  reliability of the information 
submitted by Aceitunas Guadalquivir.  In our view, it only indicates that the three respondents held 
different understandings about what was being requested . 
 
742 On 7 September  2017 the USDOC sent a supplemental questionnaire requesting the 
respondents ' largest unaffiliated suppliers to provide questionnaire responses regarding their raw olive sources 
and sales to the respondents. Questions contained in that request similarly do not ask suppliers to provide 
information on raw olives supplied to respondents for processing subject merchandise only. (See, e.g.  Letter to 
Aceitunas Guadalquivir  regarding questionnaire to unaffiliated suppliers , (Exhibit  USA-14), p. 12, general 
question  A ("[i]f your company only supplies raw olives sourced from growers, please identify the growers from 
whom your company sources raw olives, and the volume and value of raw olives sourced from each supplier 
during the [period of investigation] "); and gener al question B ( "[p]lease provide the following information for 
your company for the [period of investigation ]. … The quantity and f.o.b. value of your operations's  [sic] 
production and sales of raw olives. … The quantity and f.o.b. value of raw olives sold  to [Aceitunas 
Guadalquivir]. Please report the sale value on an f.o.b. (factory)  basis" (emphasis original))).  
743 United  States'  12 November  2020 responses to Panel question No.  44, paras.  89-91, and No.  45, 
para. 94. The United  States emphasizes that the other two mandatory respondents did seek clarification or 
additional guidance from the USDOC . (United  States' 12  November  2020 response to Panel question No.  46, 
para. 98 (referring to Letter from the USDOC on clarification , (Exhibit  EU-60), pp.  1-2)). Cou nsel for the three 
mandatory respondents Agro Sevilla, Ángel  Camacho, and  Aceitunas Guadalquivir had contacted the USDOC to 
discuss a USDOC letter, dated 26  September  2017, regarding a request for information contained in supplier 
questionnaire for the  respondents' largest suppliers. ( Letter from the USDOC on clarification , (Exhibit  EU-60), 
p. 1). WT/DS 577/R  
BCI deleted, as indicated [[ ***]] 
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  7.5.2.2.2   The USDOC 's information  requests  following  the 4 August  2017  questi onnaire  
7.348.   Several exchanges between the USDOC and the respondents after the issuance of the 
4 August  2017 questionnaire help to shed light on the nature of the information the respondents 
had in fact submitted . We find particularly instructive a 27  September  2017 memorandum addressed 
to the file, in which the USDOC recorded its exchange with the respondents'  counsel, including the 
following:  
In addition, the respondents ' counsel informed the [USDOC]  that the info rmation 
regarding the volume and value of raw olives supplied to Agro Sevilla by its member 
cooperatives and other suppliers was limited to olives used in the production of the ripe 
olives subject to this [countervailing duty] investigation. We now request  that 
Agro Sevilla resubmit  the information regarding its suppliers of raw olives to include the 
volume and value of all raw olives purchased from each supplier, regardless of the 
processed olive product for which the raw olives were used . If it is necessa ry to correct  
the reporting in this manner for the other two mandatory respondents, we request that 
the information be resubmitted .744 
7.349.   Two respondents, Agro Sevilla and Ángel Camacho, responded to the 
USDOC's  27 September  2017 request by the 6  October  2017 deadline and resubmitted  revised and 
additional raw olives data, including the  volume and value of raw olives purchased from each supplier  
regardless  of end-use.745 Aceitunas Guadalquivir , however, did not resubmit revised or additional  
information or otherwise respond to this request.  
7.350.   The European  Union argues that the only plausible  interpretation of the 27  September  2017 
request is that Agro Sevilla (and any other respondent)  needed to resubmit raw olives purchased 
from each supplier regardless of end-use, if they had not already  done so, and hence, that it had 
been incorrect  of them to limit their initial response s to the 4  August  2017 questionnaire to  providing 
information on their  raw olive purchases that were processed into ripe olives.  Furthermore, the 
European  Union contends that Aceitunas Guadalquivir 's lack of a  response should have signalled to 
the USDOC that Aceitunas Guadalquivir  had already reported its overall raw olive purchase s from 
each supplier regardless  of end-use. Hence, Aceitunas Guadalquivir  did not  need to submit new or 
updated  information.746  
7.351.   The United  States rejects the European  Union's  assertion that the 27  September  2017 
request somehow revoked or superseded the USDOC's 4  August  2017 request for respond ents to 
report their raw olive purchases processed into ripe olives. Likewise, the United  States does not 
accept that Aceitunas Guadalquivir 's silence and decision not to respond should have led the USDOC 
to believe that Aceitunas Guadalquivir 's reporting in response to the 4  August  2017 questionnaire 
reflected the company's  purchases of raw olives regardless of end -use.747 
7.352.   In our assessment, the USDOC's  27 September  2017 request indicates that it invited 
Ángel  Camacho and Aceitunas Guadalquivir , "if it is necessary", to "correct" and "resubmit" raw olive 
purchase information reported to include the volume and value of all raw olives purchased from each 
supplier, regar dless of the processed olive product for which the raw olives were used . We consider 
that Aceitunas Guadalquivir's  conduct in  not responding to the USDOC's 27  September  2017 request 
signalled that Aceitunas Guadalquivir 's reporting already included "the vo lume and value of all raw 
olives purchased from each supplier, regardless of the processed olive product for which the raw 
olives were used".  No evidence is before the Panel to indicate that Aceitunas Guadalquivir was an 
uncooperative respondent.  
7.353.   We note t hat prior to the final determination , the petitioner had argued to the USDOC that 
Aceitunas Guadalquivir  had "not reported its purchased olive volumes used only for making ripe 
olives ", and that "[i]n the absence of this information, [the USDOC] should der ive an approximation 
 
744 Letter from the USDOC on clarification , (Exhibit  EU-60), p. 2. (emphasis added)  
745 Ángel Camacho revised olive sourcing data , (Exhibit  EU-64 (BCI) ); Agro Sevilla revised olive sourcing 
data, (Exhibit  EU-65 (BCI)) . 
746 European  Union's  first written submission, paras.  701-702; 10  June 2020 response to Panel question 
No. 29, para.  145. 
747 United  States'  first written submission, paras.  283 and 311 -312. WT/DS577/R  
BCI deleted, as indicated [[***]]  
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  for Aceitunas Guadalquivir  using a yield ratio based on Angel Camacho's  purchases ".748 In rejecting 
the petitioner 's assertion  in its final issues and decision memorandum, the USDOC stated that in its 
4 August  2017 questionnaire it had asked all companies to provide information on their "sources of 
raw olives that were processed into ripe olives during the period of investigation " and that "[a]ll 
companies responded to this questionnaire by reporting their raw olive purchases ".749 Then, r eferring 
to the 27  September  2017 information request, the USDOC noted that Agro Sevilla and 
Ángel  Camacho found it necessary to submit additional information, while Aceitunas Guadalquivir  
did not. Without further explanation, the USDOC concluded:  "[t]hus, Aceitunas 
Guadalquivir's  originally reported information is indicative  of its raw olives purchases that were used 
to produce subject merchandise ".750 
7.354.   Similarly, in its 12  July 2018 Ministerial error memorandum (filed after the final 
determination ), the USDOC summarized its decision to base Aceitunas Guadalquivir 's final subsidy 
margin and countervailing duty rate on Aceitunas Guadalquivir 's volume of raw olive purchases 
reported in its responses to the 4  August  2017 questionnaire, characterizing Aceitunas 
Guadalquivir 's decision not to respond to the USDOC's  27 September  2017 request to resubmit 
information as follows:  
Because Aceitunas Guadalquivir  did not revise its data [in response to the 
27 September  2017 request], we understood that Aceitunas Guadalquivir's  reported 
volume represented purchases of raw to ripe because the initial question we asked was 
for the volume of purchases of raw to ripe. The totality of the evidence on the record 
did not suggest that Aceitunas Guadalquivir's  initial reporti ng was incorrect or was 
otherwise not responsive to the question asked.751 
7.355.   The USDOC states in this passage that it understood that Aceitunas Guadalquivir 's reported 
purchases "represented purchases of raw to ripe" because  of Aceitunas Guadalquivir 's decision  not 
to revise  that information  in the light of the 27 September  2017 memorandum . We recall, however, 
that the 27  September  2017 request sought information on total purchases of raw olives, regardless 
of end -use, and not purchases of raw to ripe . Furthermore, in its preliminary determination , which 
was issued on 20  November  2017, the USDOC treated Aceitunas Guadalquivir 's reported purchases 
as if they represented purchases of raw olives regardless  of end-use.752 Thus, the record shows that 
shortly  after Aceitunas Guadalquivir 's non-response to the 27  September  2017 memorandum, the 
USDOC did not treat Aceitunas Guadalquivir 's reported purchases of raw olives as if they represented 
its purchases of raw olives processed  into ripe olives . To this extent, the USDOC's  subsequently 
stated understanding of the implications of Aceitunas Guadalquivir 's decision not to respond to the 
27 September  2017 memorandum is inconsistent both with the information requested in that 
memorandum and with its reliance on Aceitunas Guadalquivir 's reported information to determine 
Aceitunas Guadalquivir 's preliminary subsidy margin and countervailing duty rate, which was based 
on total olive purchases, regardless of end -use.  
7.356.   According to the United  States, however, Aceitunas Guadalquivir 's response to a 
supplemental questionnaire that the USDOC sent exclusively to Aceitunas Guadalquivir  on 
21 December  2017 (that is, after the USDOC's  preliminary determination ) shows that the U SDOC 
was entitled to understand that Aceitunas Guadalquivir  had reported only purchases of raw olives 
processed into ripe olives. On 21  December  2017, the USDOC sought the following confirmation 
from Aceitunas Guadalquivir : 
In your questionnaire response o f August  14, 2017 at Exhibit  2, [Aceitunas 
Guadalquivir ] provided a list of unaffiliated suppliers and total purchases of raw olives 
to be [] kilograms. Confirm that this number includes purchases of all raw olives 
regardless of the processed olive product  for which the raw olives were used . Explain if 
these purchases are made on a gross or net basis, that is, with or without sticks, leaves, 
 
748 FIDM, (Exhibit  EU-2), p.  41. See also Case brief of petitioner  in Countervailing Duty Investigation of 
Ripe Olives from Spain ( 23 April 2018), (Exhibit USA -20), p. 11.  
749 FIDM, (Exhibit  EU-2), p.  44. 
750 FIDM, (Exhibit  EU-2), p.  44. 
751 Ministerial error memorandum, (Exhibit  EU-69), pp.  4-5. 
752 FIDM, (Exhibit  EU-2), p. 44 ("[i]n the Preliminary Determination , when calculating the  weighted 
average per kilogram benefit using the information provided by all the reporting olive  growers, we did not limit 
our calculations  to the raw olives  used to produce  ripe olives " (emph asis added)).  See also Aceitunas 
Guadalquivir  preliminary determination , (Exhibit  EU-36), pp.  2-3. WT/DS 577/R  
BCI deleted, as indicated [[ ***]] 
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  and other debris and culls. Explain how the purchased volumes are recorded in your 
accounting system and explain whet her you apply a standard yield loss ratio in recording 
the purchased volume of raw olives.753 
7.357.   On 5 January  2018, Aceitunas Guadalquivir  responded as follows:  
[Aceitunas] Guadalquivir only records the value of its raw olive purchases in its 
accounting system . Raw olive quantities are recorded in an ERP system as they are 
weighed  when they enter the factory or when purchased from storage throughout the 
year. Weight is recorded in the ERP system on a net basis ( i.e., net of other debris). 
Specifically, each del ivery is evaluated by a [Aceitunas] Guadalquivir employee to 
assess the volume of raw olives for processed olive production relative to other 
materials, such as leaves sticks, leaves, and other debris and culls. These other 
materials are not recorded as pa rt of raw olive volume in the ERP system. The [ ] 
kilograms represents all raw olive receipts as recorded in the ERP system in 2016.754 
7.358.   The United  States  maintains that  Aceitunas Guadalquivir 's response fails to confirm whether 
the reported purchase volume represented all purchases of raw olives without regard to the 
end-product.755 According to the United  States , Aceitunas Guadalquivir 's statement that it "only 
records the value of its raw olive purchases in its accounting system "756, was in response t o the 
USDOC's  request to "[e]xplain how the purchased volumes are recorded in your accounting 
system "757 and shows that its accounting system records only the value, and not the quantity, of its 
raw olive purchases.758 The United  States considers that Aceitu nas Guadalquivir 's statement that 
"[t]he [redacted] kilograms represents all raw olive receipts as recorded in the ERP system in 
2016"759 provides information regarding Aceitunas Guadalquivir 's recording system but does not 
mean that the raw olive purchase information the company submitted in response to the 
4 August  2017 questionnaire included purchases of raw olives that were used to produce products 
other than ripe  olives.760 
7.359.   We note that the USDOC did not comment on, or refer to, Aceitunas 
Guadalquivir 's 5 January  2018 response in its final issues and decision memorandum. However, the 
USDOC addressed Aceitunas Guadalquivir 's response to its 21  December  2017 request in the 
12 July 2018 Ministerial error memorandum, where it clarified as follows:  
With regard to the post -preliminary supplemental question to confirm that the reported 
purchases represented all purchases regardless of the processed product, Aceitunas 
Guadalquivir  again did not specify that the volume they reported was of raw to ripe, or 
otherwise of total purchases. Rather, Aceitunas Guadalquivir  stated that number was 
indicative of all raw olive purchases in their system; again, based on their response to 
our original question, we understood this to mean that all of their raw olive purchas es 
were for ripe olives.761 
7.360.   Thus, consistent with the United  States'  position, the USDOC explained in its Ministerial error 
memorandum that it was of the view that Aceitunas Guadalquivir  had not confirmed, in its 
5 January  2018 response, whether the reporte d purchases represented all purchases of raw olives 
regardless of end -use. In addition, the USDOC explained that it had understood from Aceitunas 
Guadalquivir 's response  to the original  questionnaire  that "all of [ Aceitunas Guadalquivir 's] raw olive 
 
753 Supplemental questionnaire to Aceitunas Guadalquivir , (Exhibit  EU-62), p.  4. (fn omitted; emphasis 
added)  
754 Aceitunas Guadalquivir  fourth supplemental questionnaire response, (Exhibit  EU-59), p.  6.  
755 The United  States  submits  that Aceitunas Guadalquivir could have clearly stated, as specifically 
prompted in the USDOC's  question, that its response had included all purchases of raw ol ives and was not 
limited to those purchases of raw olives that were used to produce ripe olives. ( United  States'  first written 
submission, para.  314; 10  June 2020 response to Panel question No.  24, para.  77). 
756 Aceitunas Guadalquivir  fourth supplemental qu estionnaire response,  (Exhibit  EU-59), p.  6. 
757 Supplemental questionnaire to Aceitunas Guadalquivir , (Exhibit  EU-62), p. 4. 
758 United  States'  10 June 2020 response to Panel question No.  24, para.  78. 
759 Aceitunas Guadalquivir  fourth supp lemental questionnair e response, (Exhibit  EU-59), p. 6. 
760 United  States'  10 June 2020 response to Panel question No.  24, para.  79. 
761 Ministerial error memorandum, (Exhibit  EU-69), p.  5. (fn omitted)  WT/DS577/R  
BCI deleted, as indicated [[***]]  
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  purcha ses were for ripe olives".762 In other words, the USDOC found Aceitunas 
Guadalquivir 's response to the supplemental questionnaire to be  inconclusive, revealing only, 
according to the USDOC, "that [the] number was indicative of all raw olive purchases in the ir 
system".763 The USDOC then reiterated its position that "based on their response to our original 
question" (i.e. the questionnaire of 4  August  2017), the USDOC considered that Aceitunas 
Guadalquivir  had reported its purchase of raw olives processed into ripe olives.  
7.361.   Again, we find the USDOC's  position to be in tension with what transpired prior to the 
21 December  2017 request. Notably, Aceitunas Guadalquivir  did not resubmit its reported purchase 
information in reaction to the USDOC's  27 September  2017 r equest " to correct  the reporting " in the 
same manner as Agro Sevilla. We recall that Agro Sevilla had been asked to "resubmit the 
information regarding its suppliers of raw olives to include the volume and value of all raw olives 
purchased from each supplier, regardless of the processed olive product for which the raw olives 
were used" .764 Moreover, and significantly, the USDOC had used Aceitunas Guadalquivir 's reported 
figures in calculating Aceitunas Guadalquivir 's preliminary subsidy margin and coun tervailing duty 
rate without "limit[ing] [its] calculation s to the raw olives used to produce ripe olives".765 The USDOC 
offers no explanation for why, if it had understood Aceitunas Guadalquivir  to have reported 
purchases of raw olives processed into ripe olives, it decided to rely on Aceitunas Guadalquivir 's raw 
olive purchases reported in response to the 4  August  2017 questionnaire  as the basis for its 
preliminary determination  of Aceitunas Guadalquivir 's subsidy margin and countervailing duty rate, 
which  were based on the total purchases regardless of end -use. 
7.5.2.2.3   Aceitunas Guadalquivir' s verification  report  
7.362.   We also find the USDOC 's stated understanding of Aceitunas Guadalquivir 's reported 
purchase information to be at odds with Aceitunas Guadalquivir 's verification report. We note that 
in the section  of the verification report where the USDOC reviewed "the total purchases of olives by 
supplier", the USDOC made the following observations:  
However, [ Aceitunas Guadalquivir ] reminded [the USDOC]  that it has only reported 
purchases of raw olives and not purchases of any "semi -processed" or "processed" 
olives that are to become or already are green olives. For example, although purchases 
of what [ Aceitunas Guadalquivir ] defined as a "semi -processed " olive were included if 
they ultimately became ripe olives, they were not included if they ultimately became 
green olives. Thus, [ Aceitunas Guadalquivir ] explained that because [the USDOC]  
requested only purchases of ripe olives, [ Aceitunas Guadalquivir ] reported only olives 
purchased in acetic acid; [ Aceitunas Guadalquivir ] did not report olives purchased in 
brine, because, as they explained, brine olives must become green olives. [ Aceitunas 
Guadalquivir ] explained that they do not consider themselves the  processors of these 
green olives that they purchase; however, when asked if they would consider 
themselves the resellers of the product, they stated no because we "process them." 
They clarified that they may change the brine, make an analysis, or prepare them by 
stuffing them, or pitting or slicing them. These olives account for an additional [ ] 
kilograms of purchases.  
…  
We preselected two of [ Aceitunas Guadalquivir 's] purchases of raw olives for the [period 
of investigation] for further examination . … The quantities reported on the invoices 
matched [ Aceitunas Guadalquivir ]'s reporting in its questionnaire responses, 
 
762 On its face, this statement could be read to mean that the USDOC considered that all of Aceitunas 
Guadalquivir's  purchased raw olives were processed into ripe olives. However, we do not understand this to be 
the USDOC's  position, as other record evidence shows that the USDOC was aware that Aceitunas Guadalquivir 
processed raw olives into other end -products. Thus, we understand the USDOC's  statement to mean that the 
USDOC considered that Aceitunas Guadalquivir's  reported  volume  of purchases  of raw olives, r epresented its 
purchases of raw olives processed into ripe olives.  
763 United States' 10  June 2020 response to Panel question No. 24, para.  79 (quoting  Ministerial error 
memorandum, (Exhibit EU -69), p. 5) . 
764 Letter from the USDOC on clarification, (Exhibit EU-60), p. 2 . 
765 FIDM, (Exhibit  EU-2), p.  44. WT/DS 577/R  
BCI deleted, as indicated [[ ***]] 
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  furthermore we were able to trace these volumes by their corresponding values through 
to [Aceitunas Guadalquivir ]'s general ledger.766 
7.363.   The United  States  argues that the USDOC 's stated understanding of the purchase 
information submitted in Aceitunas Guadalquivir 's response to the 4  August  2017 questionnaire is 
consistent with observations made in these passages.767 According to th e United  States , the 
verification report reveals that Aceitunas Guadalquivir  had selectively reported its purchases of 
"semi -processed" and "processed" olives ( i.e. reporting them only when they were processed into 
ripe olives), logically implying that Aceitunas Guadalquivir  must have also only reported its raw olive 
purchases used to process ripe olives. The United  States  maintains that Aceitunas 
Guadalquivir 's decision not to report purchases of "semi -processed" and "processed" olives that 
could no longer  become subject merchandise demonstrates that the USDOC was correct in observing 
that it "understood that the originally reported volume of olives purchased represented purchases 
of raw to ripe [( i.e. purchases of raw olives used to produce ripe olives)] a nd the additional volume 
of olive purchases not reported represented olives purchased for the production of non -subject 
merchandise ".768  
7.364.   The European  Union  rejects the United  States'  understanding of Aceitunas 
Guadalquivir 's verification report. The European  Union  contends that it is clear from the opening 
sentence in the first cited passage that the entire explanation refers to olives that are not "raw", but 
that are already semi -processed or processed, and thus, does not spe ak to Aceitunas 
Guadalquivir 's reporting of raw olives.769 The European  Union  also refers to the following passage in 
the same section  of the verification report:  
We also reviewed [ Aceitunas Guadalquivir 's] reported sales of olive derived products. 
These in clude sales of oil produced that is not sui table for consumption and olives that 
are destined for the mill ("molino"), which are olives that do not meet the standard to 
sell as a ripe or table olive; these olives are processed into an industrial olive oil not 
suitable for consumption. We observed no inconsistencies with the information reported 
in the questionnaire responses.770 
7.365.   The European  Union  argues that this passage conclusively demonstrates that the USDOC 
knew that Aceitunas Guadalquivir 's production was not limited to subject merchandise and that some 
of the raw olives purchased by Aceitunas Guadalquivir  were used to produce goods other than 
subject merchandise.771  
7.366.   We do not share the United  States'  characterization of the verification report. As an initial 
matter, we note that the cited passage in paragraph  7.362  above addresses Aceitunas 
Guadalquivir 's reporti ng of its purchases of semi-processed  and processed  olives , not its reporting 
of purchases of raw olives.  Thus, on its own, the observation that Aceitunas Guadalquivir  did not 
report purchases of semi -processed and processed olives that could not be proces sed into ripe olives 
(but could only become green olives), does not demonstrate  that Aceitunas Guadalquivir  must have 
taken the same approach with respect to its reporting of raw olive purchases.  The United  States 
argues that the same passage from the veri fication report reveals that Aceitunas Guadalquivir  
confirmed its understanding that the USDOC had "requested only purchases of ripe olives [( i.e. raw 
olives  processed  into ripe olives )]".772 We note, however, that the United  States misreads  the 
relevant statement, which does not clarify that Aceitunas Guadalquivir 's reference to "purchases of 
ripe olives" should be understood to mean "raw olives processed  into ripe olives ".773 In this regard, 
the European  Union argues that the reference to "purchases of ripe olives" in the verification report 
is incorrect, suggesting that this can only be understood to mean purchases of raw olives, as it is 
 
766 Aceitunas Guadalquivir  verification report,  (Exhibit  USA-22), p p. 7-8. (fn omitted)  
767 Ministerial error memorandum, (Exhibit  EU-69), p. 5 ("based on [Aceitunas Guadalquivir's] response 
to our original question, we understood this to mean that all of their raw olive purchases were for ripe olives. ") 
768 United  States'  10 June 2020 response to Panel question No.  24, para.  81 (referring to Ministerial 
error memorandum, (Exhibit  EU-69), p. 5). 
769 European  Union's 10 June 2020 response to Panel question No.  26, para.  130. 
770 Aceitunas Guadalquivir verification report,  (Exhibit  USA-22), p.  7. (fns omitted)  
771 European  Union's  8 September  2020 response to Panel question No.  4(b), paras.  150-152; 
11 March  2021 commen ts on United  States' 25  February  2021 response to Panel question No.  20, para.  90. 
772 United  States' 25  February  2021 response to Panel question No.  21, para.  62. (emphasis added)  
773 Emphasis added.  WT/DS577/R  
BCI deleted, as indicated [[***]]  
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  uncontested that the USDOC asked for purchase informat ion with respect to raw olives.774 However , 
contrary to the United  States'  reading, other information from the verification report reveals that 
the USDOC had, in fact, verified that reported purchases of raw olives included "molino" olives.775 
As the USDOC i ndicated in the verification report (cited in paragraph  7.363  above), these olives do 
not meet the standard to sell as a ripe olive and are instead pr ocessed into an industrial olive oil not 
suitable for consumption.776 In our view, the fact that the USDOC was aware that Aceitunas 
Guadalquivir  used raw olives to produce products other than ripe olives, and the fact that the USDOC 
observed that certain ra w oliv es ("molino" olives ) identified in Aceitunas Guadalquivir 's invoices did 
not meet the standard to be sold  as ripe olive s, and were process ed into industrial olive oil not 
suitable for consumption , undermine the United  States'  reading of the verification report.777 
Moreover, as further discussed below, information on record also revealed a significant discrepancy 
between the volume of raw olives purchased by Aceitunas Guadalquivir  and the sales of ri pe olives.  
7.5.2.2.4   Aceitunas Guadalquivir 's submissions  on the reported  volume  of raw olive  
purchases  after  the final determination  
7.367.   Finally, the European  Union maintains that the USDOC also had before it information 
showing that Aceitunas Guadalquivir's  reported volume of raw olives purchased was significantly 
larger  than its reported  volume of its sales of ripe olives .778 Given the size of this difference , the 
European  Union  argues that the USDOC could not properly have regarded Aceitunas 
Guadalquivir 's reported data as being "indicative" of raw olive purchases solely to process ripe 
olives.779 The USDOC's  12 July 2018 Ministerial error memorandum reveals that Aceitunas 
Guadal quivir  made the same point, commenting that, due to the "comparatively small volume " of 
Aceitunas Guadalquivir 's sales of subject merchandise relative to Aceitunas Guadalquivir 's reported 
volume of purchases contained in its responses to the 4  August  2017 questionnaire, the USDOC 
should have known that the reported volume of purchases did not represent the volume of raw olives 
purchased to produce ripe olives.780 Consequently, Aceitunas Guadalquivir  requested  the USDOC to 
use the volume of Aceitunas Guadalqu ivir's ripe olives sales during the period of investigation as a 
proxy to derive the volume of raw olive purchases to process into ripe olives.  
7.368.   The USDOC rejected Aceitunas Guadalquivir 's request on the grounds that, for the reasons 
set out above781, it ha d understood Aceitunas Guadalquivir  to have provided information on its 
purchase of raw olives for processing into ripe olives. The USDOC then went on to note that even if 
the volume originally reported did not represent raw olive purchases to process ripe  olives, then the 
"correct" volume was not on the record. The USDOC further characterized the situation as "a 
reporting error made by the respondent, which the respondent did not alert [the USDOC] to during 
the course of the investigation or prior to the i ssuance of the Final Determination " and observed that 
the absence of an alternative volume of olive purchases on the record was not a ministerial error 
eligible for correction.782 We note, however, that the USDOC did not adequately address  Aceitunas 
Guadalq uivir's submission that the "comparatively small" volume of reported sales of ripe olives 
relative to the reported volume of purchases of raw olives demonstrated that the reported volume 
of raw olives represented "a volume greater than the purchases of 'ra w to ripe'".783 
 
774 European  Union's  10 June 2020 response to Panel question No.  26, para.  132 ( "[i]t is apparent that 
the wording of the verification is incorrect, as it refers to a request for 'purchases of ripe olives '. It is however 
uncontested between the United  States  and the EU that the investigating authority did not request information 
on purchases of ripe olives, but only on purchases of raw olives " (emphasis omitted) ). 
775 United  States' 25  February  2021 response to Panel question No.  21, para.  62. 
776 After issuance o f the final determination , Aceitunas Guadalquivir argued to the USDOC that this part 
of the  verification report demonstrated that the USDOC had verified and, therefore, should have known that its 
reported purchases included raw olives purchased to produce products other than ripe olives . (Ministerial error 
memorandum, (Exhibit  EU-69), p.  3). 
777 United  States' 25  February  2021 response to Panel question No.  21, para.  62.  
778 The European  Union has submitted that in 2016 the volume of raw olives purchased by Aceitunas 
Guadalquivir  was [[***]] kilograms  while the volume of its sales of ripe olives was [[***]] kilograms , 
representing a relative difference of [[***]]%. (European  Union's  first written submission, para. 663 (referring 
to Aceitunas Guadalquivir  comments for the final determination, (Exhibit  EU-71 (BCI)), p.  4)). 
779 European  Union's  first written submission, para. 663. 
780 Ministerial error memorandum, (Exhibit  EU-69), p. 3. 
781 See paras.  7.354  and 7.359  above.  
782 Ministerial error memorandum, (Exhibit  EU-69), p. 5. 
783 Ministerial error memorandum, (Exhibit  EU-69), p. 3. WT/DS 577/R  
BCI deleted, as indicated [[ ***]] 
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  7.369.   We recall that the USDOC 's Ministerial  error memorandum was issued after the final 
determination  in this dispute. Under US law the purpose of such memoranda is to correct any error 
"in addition, subtraction, or other arithmetic function, clerical error resulting from inaccurate 
copying, duplication, or the like, and any other similar type of unintentional error which [the USD OC] 
considers ministerial".784 The USDOC found that its reliance on Aceitunas Guadalquivir 's volume of 
raw olives purchases, as reported in its response to the 4  August  2017 questionnaire, was not a 
ministerial error, and the European  Union  has not challeng ed that characterization. We accept that 
there is a point in every investigation when the exchange between interested parties and an 
investigating authority with respect to matters addressed in a proceeding must come to an end. 
However, in the light of the  events that transpired prior to the final determination , we believe that , 
overall and on balance,  the record of the investigation shows that there were multiple indications 
that the volume of purchases of raw olives reported by Aceitunas Guadalquivir  in its response to the 
4 August  2017 questionnaire did not represent only Aceitunas Guadalquivir 's purchases of raw olives 
processed into ripe olives.  
7.370.   First, we recall our finding that the USDOC 's initial request for information in the 
4 August  2017 cover lett er and  questionnaire could reasonably have been understood in two ways, 
including in the manner interpreted by Aceitunas Guadalquivir . Second, Aceitunas Guadalquivir  did 
not "correct" and " resubmit " its reported purchase information in response to the 
USDO C's 27 September  2017 request "to correct the reporting" so as  to "resubmit the information 
regarding its suppliers of raw olives to include the volume and value of all raw olives purchased from 
each supplier, regardless of the processed olive product for which the raw olives were used"785, 
conduct that confirmed that  Aceitunas Guadalquivir had already reported its total raw olive 
purchases in response to the 4  August  2017 questionnaire.  Third, and in our view, significantly, the 
USDOC treated Aceitunas Guadalquivir 's reported figures as representing its volume of purc hases of 
raw olives for processing into any end -product when it calculated Aceitunas 
Guadalquivir 's preliminary subsidy margin and countervailing duty rate. Finally, verification revealed 
that the reported volume of purchases of raw olives included "molino " olives  (which are not 
processed into ripe olives), and record evidence showed that there was a [[***]]% difference 
between the reported volume of raw olives purchased by Aceitunas Guadalquivir  and the reported 
volume of Aceitunas Guadalquivir 's sales of ripe olives.786 
7.5.2.2.5   Conclusion  
7.371.   Thus, in the light of the above considerations, we find that, by relying on the volume of 
Aceitunas Guadalquivir 's raw olive purchases reported in its response to the initial 4  August  2017 
questionnaire to determine  Aceitunas Guad alquivir 's final subsidy margin and countervailing duty 
rate, the USDOC acted inconsistently with the requirement in Article  VI:3 of the  GATT  1994 to 
ensure and take the necessary steps to ascertain , as accurately as possible , the amount of 
subsidization bestowed on the investigated products.  
7.372.   Having found that the United  States acted  inconsistent ly with Article  VI:3 of the  GATT  1994, 
we believe that it is not necessary to achieve a positive solution to this dispute to make additional 
findings  in relation to these claims under  Articles  10, 19.1, 19.3, 19.4 , and 32.1 of the 
SCM Agreement. We therefore decline to address these claims . 
7.5.3   The USDOC's  calculation  of an "all others " rate 
7.373.   The European  Union claims that the United  States acted inconsiste ntly with its obligations 
under Article  VI:3 of the  GATT  1994 and Articles  10, 19.1, 19.3, 19.4 , and 32.1 of the 
SCM Agreement, due to the manner in which the USDOC calculated the "all others " rate of 
 
784 The 12  July 2018 ministerial memorandum notes in this regard that Section  705(e)  of the Act and 
19 CFR 351.224(f)  define a "ministerial error " as an error in addition, subtraction, or other arithmetic function, 
clerical error resulting from inaccurate copying, duplication, or the like, and any other similar type of 
unintentiona l error which the USDOC considers ministerial. ( Ministerial error memorandum, (Exhibit  EU-69), 
p. 2). 
785 Letter from the USDOC on clarification, (Exhibit EU -60), p. 2 . 
786 According to the European  Union , such a discrepancy means that Aceitunas Guadalquivir' s reported 
purchases could not be reasonably construed as "indicative " of its raw olives purchases that were used to 
produce subject merchandise. (European  Union's  first written submission, para. 663 (referring to the same 
submission made by Aceitunas Guadalquivir  to the USDOC in Aceitunas Guadalquivir  comments for the final 
determination,  (Exhibit  EU-71 (BCI)), p. 4)). WT/DS577/R  
BCI deleted, as indicated [[***]]  
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  countervailing duties imposed on exporters of ripe oliv es not individually investigated. The USDOC 
calculated the "all others" rate of countervailing duties as the weighted average of the countervailing 
duties imposed on the three mandatory respondents, Agro Sevilla, Ángel  Camacho , and Aceitunas 
Guadalquivir .787 The European  Union argues that to the extent that the USDOC incorrectly calculated 
Aceitunas Guadalquivir 's subsidy margin and countervailing duty rate, then the "all  others" rate must 
also be inconsistent with the same obligations.  
7.374.   We agree with the Eur opean  Union that an inconsistency arising in respect of the calculation 
of Aceitunas Guadalquivir 's subsidy margin and corresponding countervailing duty rate necessarily 
has implications for the "all others " rate, as the USDOC calculated  this rate as the w eighted average 
of the duties imposed on the three mandatory respondents . In the preceding analysis we found that 
the USDOC's  calculation of Aceitunas Guadalquivir 's final subsidy margin and corresponding 
countervailing duty rate was inconsistent with Arti cle VI:3 of the GATT 1994. Accordingly, we find 
that the USDOC's  calculation of the "all others" rate was, consequently, also inconsistent with 
Article  VI:3 of the  GATT  1994.  
7.375.   Having reached this finding, we do not further address the European  Union's  claim s under 
Articles  10, 19.1, 19.3, 19.4 , and 32.1 of the SCM  Agreement in respect of the USDOC's calculation 
of the "all others " rate, as we do not consider it necessary to do so for purposes of resolving the 
dispute before us.  
7.5.4   Whether  the USDOC  properly  requested  information  on purchases  of raw olives  
used  to produce  ripe olives  consistent ly with Article  12.1 of the SCM Agreement  
7.376.   The European  Union  claims that the USDOC acted inconsistently with  Article  12.1 of the 
SCM Agreement  by allegedly fail ing to properly notify Aceitunas Guadalquivir  that the USDOC 
required information regarding Aceitunas Guadalquivir 's volume of purchases of raw olives that were 
processed into the subject merchandise, ripe olives.788 The United  States argues that the 
European  Union's  claim relies on a misreading of the USDOC 's initial 4  August  2017 questionnaire 
and an incomplete account of the factual record  and therefore should be rejected.789 
7.377.   Article  12.1 of the SCM  Agreement  provides:  
Interested Members and  all interested parties in a countervailing duty investigation shall 
be given notice of the information which the authorities require and ample opportunity  
to present in writing all evidence which they consider relevant in respect of the 
investigation in q uestion.  
7.378.   We agree with the parties, as well as past panel and Appellate  Body reports , that Article  12.1 
of the SCM  Agreement sets out fundamental due process rights, in particular, for an interested party 
to be given adequate notice of any information the investigating authority requires and an adequate 
opportunity to provide the requested information.790 The particular information that an investigating 
authority requires from interested parties will determine what the notice must convey and will vary 
with t he circumstances. In this regard, we share the view expressed by the panel i n China  – Broiler  
Products  that, "[a]t a minimum, a notice must convey an understanding of what information is 
required in order to enable all interested parties to prepare and sub mit relevant written evidence 
regarding the matters as to which information is sought. "791 
7.379.   The European  Union's  claim derives from its argument that the USDOC's  initial 
4 August  2017 questionnaire requested respondents to report the volume and value of all raw  olives 
purchased from each supplier, regardless of the processed olive product for which the raw olives 
were used . The European  Union submits that Aceitunas Guadalquivir  correctly understood the 
questionnaire as asking for this information and further submits  that the USDOC 's actions after the 
 
787 PIDM, (Exhibit  EU-1), p. 31. 
788 European  Union's  first written submission, paras.  712-718. 
789 United  States'  first written submission, para.  265. 
790 European  Union's  first written submission, para. 715; United  States'  first written submission, 
para. 268. See, e.g. Appellate  Body Report, US – Oil Country  Tubular  Goods  Sunset  Reviews , para. 241.  
791 Panel Report, China  – Broiler  Products  (Article 21.5 – US), para. 7.232.  WT/DS 577/R  
BCI deleted, as indicated [[ ***]] 
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  4 August  2017 questionnaire  demonstrate that Aceitunas Guadalquivir 's understanding  was 
correct .792 
7.380.   The United  States maintains that th e 4 August  2017 questionnaire requested the 
respondents'  purchase information on raw olives used to produce ripe olives, thereby notifying the 
mandatory respondents that the USDOC required this information .793 The United  States also 
emphasizes that the other two mandatory respondents, Agro Sevilla and Ángel Camacho, responded 
to the initial questionnaire by reporting their raw olive purchases used to process subject 
merchandise.794 
7.381.   As we found above795, we disagree with the United  States'  assertion that th e 4 August  2017 
questionnaire identified in clear and unambiguous  terms that the USDOC was requesting the 
respondents to report purchase information for raw olives processed into ripe olives. On the one 
hand, we found that if read in connection with the la nguage in the questionnaire's  cover letter, a 
respondent could have reached the understanding that it was supposed to report its raw olive 
purchases that were used to process ripe olives. T he two respondents, Agro Sevilla and 
Ángel  Camacho , did in fact  submit information only on raw olive purchases to produce subject 
merchandise. On the other hand, as we noted above, based on their wording, the relevant questions 
could also plausibly have been understood by a reasonable interested party to have asked for 
information on raw olive purchases regardless of end -use. In this regard, we recall that the 
referenced "[t]emplate for Suppliers of Raw Olives"  did not ask the respondents to distinguish and 
separately report data with respect to the volume of raw olives purchased that are processed into 
ripe olives , and raw olive purchases regardless of the processed olive product for which the raw 
olives were used . Nor do we think that the ambiguity should have led Aceitunas Guada lquivir to have 
sought clarification as to what was being requested. Accordingly , we disagree that the 4  August  2017 
questionnaire provided the requisite notice.  
7.382.   Moreover, the USDOC did not at any subsequent point prior to the final determination796 
request  that Aceitunas Guadalquivir  report  its raw olive purchases that were used to process ripe 
olives, or suggest that Aceitunas Guadalquivir  should have reported its raw olive purchases that 
were used to process ripe olives. As explained above797, in its 27  September  2017 request the 
USDOC alerted the respondents that the legal counsel for Agro Sevilla had informed the USDOC that 
the volume and value of raw olives that Agro Sevilla had reported in response to the 4  August  2017 
questionnaire was limited to olive s used in the production of the ripe olives. The USDOC requested 
that Agro Sevilla "resubmit" the information regarding its suppliers of raw olives to include the 
volume and value of all raw olives purchased from each supplier, regardless of the processed olive 
product for which the raw olives were used, and also requested the other respondents to "resubmit" 
and "correct" their reporting in this manner, if it was necessary to do so .798 Aceitunas Guadalquivir  
did not resubmit any new information. Subsequently , the USDOC used information on the volume  
of raw olives  purchased,  irrespective  of end-use, submitted by Agro Sevilla and Ángel  Camacho in 
response to the 27  September  2017 request, and reported by Aceitunas Guadalquivir  in its 
responses to the 4  August  2017 questionnaire, to determine preliminary subsidy margins of the 
three respondents.799 Then, on 21  December  2017800, the USDOC requested Aceitunas Guadalquivir  
to confirm that information reported by Aceitunas Guadalquivi r in its responses to the 4  August  2017 
questionnaire included purchases of all raw olives regardless of the processed olive product for which 
 
792 European  Union's  first written submission, paras.  643-665; second  written submission, para. 195. 
793 Letter to Aceitunas Guadalquivir  on questionnaire , (Exhibit  EU-58); Letter to Agro Sevilla on 
questionnaire , (Exhibit  USA-6); and Letter to Ángel Camacho on questionnaire , (Exhibit  USA-7). 
794 United  States'  first written submission, paras.  284-285. As explained in fn  739 above, in response to 
the USDOC's  27 September  2017 request, both Agro Sevilla and Ángel Camacho  each replied by resubmitting 
the template for their raw olive suppliers, delineating their purc hases of raw olives that were processed into 
ripe olives and purchases of raw olives that were processed into other olive products. The information confirms 
that Agro Sevilla and Ángel Camacho  responded to the USDOC's  4 August  2017 questionnaire by submitt ing 
purchases of raw olives that were processed into ripe olives.  
795 See paras.  7.337  and 7.347  above.  
796 In its final issues and decision memorandum the US DOC stated that the cover letter to the initial 
4 August  2017 questionnaire  had "asked all companies to provide information on their 'sources of raw olives 
that were processed into ripe olives during the period of investigation'" . (FIDM, (Exhibit  EU-2), p. 44). 
797 See paras.  7.348 -7.355  above.  
798 Letter from the USDOC on clarification , (Exhibit  EU-60), p. 2. 
799 PIDM, (Exhibit  EU-1), p. 17. See also Aceitunas Guadalquivir  preliminary determination , 
(Exhibit  EU-36), pp.  2-3. 
800 See paras.  7.356 -7.361  above.  WT/DS577/R  
BCI deleted, as indicated [[***]]  
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  the raw olives were used , without asking Aceitunas Guadalquivir  to report  its raw olive purchases 
that were used to process ripe olives .801 
7.383.   In light of the above, we disagree that the USDOC properly notified interested parties of the 
required information on purchases of raw olives. As we have explained, neither in the initial 
4 August  2017 questionnaire nor subsequent ly, did the USDOC clearly , and unambiguously,  convey 
an understanding to the respondents that they were required to submit information on raw olive 
purchases used to process  ripe olives . Indeed, the actions of the USDOC after issuance of the initial 
questionnaire appeared to confirm that the required information was the volume of raw olives 
purchased regardless of end -use. Accordingly, we find that the USDOC failed to notify the 
respondents within the meaning of Article  12.1 of the SCM  Agreement that the USDOC required 
information regarding the volume of purchases of raw olives that were processed into the subject 
merchandise, ripe olives . 
7.5.5   Whether  the USDOC  informed  interested  parties  of the essential  facts  under  
consideration  consistent  with Article  12.8 of the SCM Agreement  
7.384.   The European  Union  claims that the USDOC acted inconsistently with Article  12.8 of the 
SCM Agreement because the USDOC allegedly failed to disclose, before its final determination , that 
the volume of purchases of raw olives process ed into ripe olives was an "essential fact"  for its 
determination of Aceitunas Guadalquivir 's final subsidy rate.802 The United  States argues that the 
European  Union's  claim should be rejected as the USDOC disclosed the essential facts under 
consideration "months before the final determination ", thus permitt ing the parties to defend their 
interests.803 
7.385.   Article  12.8 of the SCM  Agreement  provides:  
The authorities shall, before a final determination is mad e, inform all interested 
Members and interested parties of the essential facts under consideration which form 
the basis for the decision whether to apply definitive measures. Such disclosure should 
take place in sufficient time for the parties to defend th eir interests.  
7.386.   Article  12.8 does not specifically define the "essential facts under consideration" that an 
investigating authority must disclose prior to its final determination. However, it follows from the 
fact that they must be those "which form the bas is for the decision whether to apply definitive 
measures", that not all facts considered by an investigating authority need to be disclosed. Rather, 
we agree with prior panels and the Appellate  Body, that the "essential facts" that must be disclosed 
are "those facts that are significant in the process of reaching a decision as to whether or not to 
apply definitive measures" .804 In our view, given that the margin or amount of subsidization lies at 
the centre of a decision of whether or not to apply definitive  measures, facts relating to the 
calculation of the margin or amount of subsidization are "essential facts" within the meaning of 
Article  12.8 of the SCM  Agreement.805 We also note that Article  12.8 directs investigating authorities 
to inform interested par ties of those facts in sufficient  time to ensure they can defend  their interests . 
In our view, this means that the disclosure of "essential facts" must be done in such a way that 
permits an interested party to understand how they have been used and potenti ally relied upon by 
an investigating authority. In this regard, we share the view expressed by the Appellate  Body that 
authorities must disclose the "essential facts under consideration" in a "coherent way" so that 
interested parties can understand the bas is for the decision whether to apply definitive measures .806 
 
801 Supplemental questionnaire to Aceitunas Guadalquivir , (Exhibit  EU-62), p.  4. 
802 European  Union's  first written submission, para. 728. 
803 United  States'  first written submission, para.  321. 
804 Appellate  Body Report, China  – GOES , para. 240. See also Panel Reports,  US – Supercalendered  
Paper , para. 7.82;  and China  – Broiler  Products  (Article  21.5 – US). 
805 For a similar view, s ee Panel Report, China  – GOES , para.  7.463 (stating that the essential  facts 
underlying an investigating authority's  conclusions regarding the amount of subsidization should also be 
disclosed under Article  12.8 as the rate of subsidization also forms the basis of the decision whether to apply 
definitive measures).  See also Panel Report, Mexico  – Olive Oil, para. 7.110 . Similarly, in the context of 
anti-dumping, the Appellate  Body has found that the calculation methodology used by an investigating 
authority may constitute an essential fact, within the meaning of Article  6.9 of the Anti -Dumping  Agreement. 
(Appellate  Body Report, Russia  – Commercial  Vehicles , para.  5.218).  
806 Appellate  Body Report, China  – GOES , para. 240. WT/DS 577/R  
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  7.387.   The European  Union's  claim concerns the alleged failure of the USDOC to inform the 
respondents, prior to making a final determination, that their final subsidy margins would be 
calculated by relyi ng on each respondent's  volume of purchases of raw olives processed into ripe 
olives . As discussed above807, in its calculation of final subsidy margins the USDOC used what it 
considered to be each respondent's  volume of purchases of raw olives processed in to ripe olives to 
determine the subsidy amount (i.e. the numerator in its calculation) .808 In its preliminary 
determination , however, the USDOC had calculated subsidy margins for the respondents based on 
a different methodology that relied upon the respondents'  reported volume of overall purchases of 
raw olives, regardless of the end -product they were used to produce.809  
7.388.   Not unlike its argument under Article  12.1 of the SCM  Agreement, t he European  Union  
submits that the USDOC's  initial questionnaire was correctly understood as asking the respondents 
to report their overall raw olive purchases. Thus, the European  Union contends that the USDOC could 
not have disclose d to the respondents through the initial questionnaire  that the volume of purchases 
of raw olives processed into ripe olives was an "essential fact" that would be used to determine each 
of the respondents ' final subsidy margins. In addition, the European  Union  argues that the USDOC 
did not at any subsequent point prior to the final determinat ion disclose to the respondents that the 
volume of purchases of raw olives processed into ripe olives was going to be used to determine the 
respondents ' final subsidy margins. To the contrary, the European  Union  submits that the 
USDOC 's entire "approach" u p to the point of adoption of the final determination  suggested that the 
volume of purchases of all raw olives , regardless of end -use, was the decisive value . Thus, according 
to the European  Union, the only reasonable inference of the USDOC's  actions was t hat the USDOC 
did not regard the value of raw olives processed into ripe olives as a relevant fact and as a result, 
the respondents  were not able to  effectively defend their interests .810 
7.389.   The United  States denies that the respondents were not aware that their raw olive purchases 
used to process ripe olives was an essential fact under consideration or that the respondents  could 
not effectively defend their interests . In this respect, the United  States submits that the USDOC 
disclosed to interested parties on at least three  occasions before the final determination  that the 
essential facts under consideration included the volume of raw olives processed into ripe olives : first, 
through its 4  August  2017 and 27  September  2017 questionnaires; second, through the  
USDOC 's February  2018 notification agenda for on -site verification ; and finally, through verification 
reports  subsequently sent to the parties. Thus, the United  States contends that the facts under 
consideration, as variables in the benefit calculation for the final determination , were extensively 
addressed in the record and interested parties had sufficient time  to – and in fact did – defend their 
interests.811 In this regard, the United  States maintains that the written and oral advocacy presented 
by the interested parties between the preliminary  and final determination s demonstrates that the 
necessary disclosure  took "place in sufficient time for the parties to defend their interests ".812 
7.390.   We understand that the obligation in Article  12.8 requires an investigating authority to 
disclose the essential facts in such a way that permits an interested party to understand  the basis 
for the decision that will be  reached by the investigating  authority and defend its interests. We do 
not exclude the possibility that an investigating authority 's request for information in a n initial  
questionnaire may serve this purpose. Howeve r, whether such a request will provide the requisite 
notice will depend on how the questionnaire is drafted and the particular circumstances  in which it 
is issued . The fact that requested information may have been provided does not necessarily imply 
that a n investigating authority has informed  a party of the essential facts. Were this to be the case, 
the obligation in Article  12.8 would be arguably reduced to ensuring that an investigating authority  
did not rely on any fact that had not been solicited from a party during the investigation. In other 
words, Article  12.8 would not require any action on the part of an investigating authority other than 
simply requesting information.  
7.391.   Turning to the 4  August  2017 questionnaire, we recall that, in the context of ad dressing the 
European  Union's  other claims, including its Article  12.1 claim813, we disagreed with the 
 
807 See para.  7.321  above.  
808 FIDM, (Exhibit  EU-2), p.  44. 
809 See para.  7.321  above. See also PIDM, (Exhibit  EU-1), p.  17; and Aceitunas Guadalquivir  preliminary 
determination , (Exhibit  EU-36), pp.  2-3. 
810 European  Union's  first written submission, paras.  722-728. 
811 United States'  first written submission, paras.  329-331. 
812 United  States'  first written submission, para.  332. 
813 See para.  7.381  above.  WT/DS577/R  
BCI deleted, as indicated [[***]]  
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  United  States'  assertion that it identified in clear terms that the USDOC was requesting the 
respondents to report purchase information for raw olives processed into ripe olives. Accordingly, 
we do not  consider  that the 4  August  2017 questionnaire can be found to have informed the 
respondents that the essential facts under consideration included the volume of raw olives processed 
into ripe olives  or that those facts would form the basis of the USDOC's  calculation of subsidization 
amounts in its final determination . 
7.392.   We are also of the view that the USDOC 's 27 September  2017 request did not disclose to 
the respondents that both sets of raw olive purc hase information – i.e. raw olives that were used to 
produce ripe olives and raw olives regardless of their use – would be under consideration in 
determining whether to apply definitive measures.814 We recall that the 27  September  2017 
memorandum stated the  following:  
In addition, the respondents ' counsel informed the [USDOC]  that the information 
regarding the volume and value of raw olives supplied to Agro Sevilla by its member 
cooperatives and other suppliers was limited to olives used in the production of  the ripe 
olives subject to this [countervailing duty] investigation. We now request that 
Agro Sevilla resubmit the information regarding its suppliers of raw olives to include the 
volume and value of all raw olives purchased from each supplier, regardless  of the 
processed olive product for which the raw olives were used. If it is necessary to correct 
the reporting in this manner for the other two mandatory respondents, we request that 
the information be resubmitted.815 
7.393.   As discussed in the context of address ing the European  Union's  other claims, rather than 
disclosing to the  respondents that their raw olive purchases used to process ripe olives would form 
the basis of their subsidy calculations, the 27  September  2017 request suggested that the volume 
and valu e of all raw olives purchased from each supplier regardless  of end-use, was the information 
sought by the USDOC. As already explained816, upon being alerted that Agro Sevilla had report ed 
the volume and value of raw olives used to process ripe olives in response to the 4  August  2017 
questionnaire, the USDOC requested Agro Sevilla to "resubmit " information regarding its purchases  
of all raw olives, regardless of the processed olive product for which the raw olives were used. The 
USDOC also requested the other respondents to "resubmit " and "correct " their reporting in this 
manner if it was necessary to do so. The United  States  emphasizes that the 4  August  2017 and 
27 September  2017 questionna ires were separate requests for information and that the 
27 September  2017 request did not withdraw or alter the 4  August  2017 request.817 In addition, the  
United  States  submits  that, in asking the respondent companies to "correct " and "resubmit " their 
purchase volume information "to include  the volume and value of all raw olives purchased from each 
supplier, regardless of the processed olive product for which the raw olives were used "818, the 
27 September  2017 request asked the respondents to supplement – not replace – the previously 
reported  information on purchases of raw olives that were used to produce ripe olives.819 We note, 
however, that the 27 September  2017 request directs the respondents to resubmit information only 
if it was necessary  to do so. Furthermore, in its request, the USDOC did not explicitly instruct the 
respondents to ensure that both figures were on record.820 Therefore, based on our reading of the 
USDOC's  request, if a respondent had already submitted their overall raw olive purchases without 
regard to end -use (as opposed to its raw olive purchases used to process ripe olives), that 
respondent could have reasonably understood that there was no obligation to "resubmit" and 
"correct" reported information. We fail to see how a respondent in that situation would have 
 
814 United  States'  first written submission, para.  329. 
815 Letter from the USDOC on clarification , (Exhibit  EU-60), p. 2. (emphasis added)  
816 See also paras.  7.348 -7.355  above.  
817 United  States'  first written submission, paras.  283 and 311 -312; 8  September  2020 response to 
question No.  IV(a), para.  38. 
818 Letter from the USDOC on clarification , (Exhibit  EU-60), p. 2. (emphasis  added)  
819 United  States'  8 September  2020 response to question No.  IV(a), para.  39. 
820 The United  States emphasizes that the respondents Agro Sevilla and Ángel Camacho each submitted 
revised exhibits that delineated each company's purchases of raw olives that were processed into ripe olives, 
purchases of raw olives that were processed into other olive products, and total purchases of raw olives 
without regard to use. (United  States'  8 September  2020 response to question No.  IV(a), para.  40). However, 
in its 27  September letter, the USDOC requested that Agro Sevilla "resubmit the information regarding its 
suppliers of raw olives to include the volume and value of all raw olives purchased from each supplier, 
regardless of the processed olive product for which the raw olives were used ". The USDOC requested the other 
respondents to resubmit infor mation "[i]f it is necessary to correct the reporting in this manner ". (Letter from 
the USDOC on clarification , (Exhibit  EU-60), p. 2). WT/DS 577/R  
BCI deleted, as indicated [[ ***]] 
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  necessaril y understood that both sets of raw olive purchase information – i.e. raw olives that were 
used to produce ripe olives and raw olives regardless of use  – were essential facts under 
consideration.  
7.394.   As discussed in detail in the preceding sections  of our analy sis, the USDOC used information 
submitted by Agro Sevilla and Ángel  Camacho in response to the 27  September  2017 request, and 
information reported by Aceitunas Guadalquivir  in its responses to the initial 4  August  2017 
questionnaire, to determine preliminary subsidy margins for the three respondents.821 On 
21 December  2017822, the USDOC further requested Aceitunas Guadalquivir  to confirm that the 
information reported by Aceitunas Guadalquivir  in its responses to the 4  August  2017 questionnaire 
includ ed purchases of all raw olives regardless of the processed olive product for which the raw 
olives were used.823 Based on this build -up of events, we share the European  Union's  view that up 
to that point, the USDOC 's approach suggested that the volume of pur chases of raw olives regardless 
of end -use was the decisive value in determining the respondents ' subsidy margins.  
7.395.   The other occasions in which the United  States considers that the USDOC gave the relevant 
notice to  interested parties  concern the USDOC's on -site verification of each 
company's  questionnaire responses.  
7.396.   The United  States argues that the USDOC 's 9 February  2018 notification agenda for on -site 
verification  disclosed to the parties in at least two ways that purchase volumes of raw olives used to 
produce ripe olives were essential facts under consideration. First, the United  States maintains that  
each respondent's agenda  listed the factual submissions to be verified, including the 4 August  2017 
questionnaire requesting information regarding mandator y respondents ' purchases of raw olives 
used to produce ripe olives purchases.  In addition, the United  States maintains that the section  in 
the agenda entitled "Sales and Export Information " directed parties to be prepared to present 
information regarding "[t]otal quantities of raw olives used for specific types of finished products 
(i.e., ripe olives, other table olives, olive oil, other) ", thus informing the parties that the total 
purchases of raw olives and those purchases of raw olives used for specific  types of products, such 
as ripe olives, were essential facts under consideration.824 
7.397.   We recall that we have already found that  the 4  August  2017 questionnaire did not inform 
the respondents that the essential facts under consideration included the volume o f purchases of 
raw olives processed into ripe olives .825 We note  also that the United  States considers the language 
in the verification agenda  informed the respondents that the total purchases of raw olives and 
purchases of raw olives used for specific type s of products, such as ripe olives, were essential facts 
under consideration .826 In our view, the fact that the  verification  agenda revealed that the USDOC 
wanted to verify "[t]otal quantities of raw olives used for specific types of finished products ( i.e., ripe 
olives, other table olives, olive oil, other)"  is not a notification that the USDOC intended to use, or 
was considering to use, only the volume of raw olives purchased for processing into ripe olives in its 
calculation of the subsidy margin. In the absence of any explanation as to why the USDOC wanted 
the responding parties to be prepared for  verification of  the listed information, the agenda item (to 
the extent that it referred to all finished  products ) could have also been understood as a means for 
the USDOC to verify the reported volumes of purchases of raw olives regardless  of end-use. Indeed, 
such an understanding would have been consistent with events preceding the on -site verification, 
which as we  have already noted suggested that the volume of purchases of raw olives regardless of 
end-use would be the value  used in the USDOC's  determination of the respondents'  subsidy margins.  
 
821 PIDM, (Exhibit  EU-1), p. 17. See also Aceitunas Guadalquivir  preliminary determination , 
(Exhibit  EU-36), pp.  2-3. 
822 See paras.  7.356 -7.361  above.  
823 Supplemental questionnaire to Aceitunas Guadalquivir , (Exhibit  EU-62), p.  4. 
824 United  States' first written submission, para.  330. See also Letter to Aceitunas Guadalquivir  
regarding verification of questionnaire responses , (Exhibit  USA-21), p. 6; Letter to Agro Sevilla regarding 
verification of questionnaire responses , (Exhibit  USA-18), p. 5; and Letter to Ángel Camacho regarding 
verification of questionnaire responses , (Exhibit  USA-19), p . 5. 
825 We recall our view, as set out above, whether an investigating authority 's request for information in 
a questionnaire may serve to disclose to interested parties which are the essential facts under consideration 
will depend on the  circumstances. (See para. 7.390  above ). 
826 United  States'  first written submission, para. 330 (referring to Letter to Aceitunas Guadalquivir  
regardin g verification of questionnaire responses , (Exhibit  USA-21), p. 8). WT/DS577/R  
BCI deleted, as indicated [[***]]  
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  7.398.   The United  States  also refers to  Aceitunas Guadalquivir 's verification report , which the 
United  States argues " shows that the USDOC reviewed Aceitunas Guadalquivir 's purchases of raw 
olives and, more specifically, Aceitunas Guadalquivir 's purchases of raw olives that were processed 
into ripe olives ".827 The section  of the verification report cited by the United  States addresses 
Aceitunas Guadalquivir 's purchases of olives by supplier, both cross -owned and unaffiliated, as well 
as the purchase terms of raw olives. Relevant portions of this section  are quo ted in paragraphs  7.362  
and 7.363  above. As the report confirms, Aceitunas Guadalquivir  representatives explained how they 
collected the information on olive purchases which were reported in its questionnaire responses. The 
USDOC  also reviewed Aceitunas Guadalquivir 's reported sales of olive -derived products.828 Similar 
to our view o n the USDOC 's 9 February  2018 notification agenda , we do not see how the verification 
of Aceitunas Guadalquivir 's reported purchase information provides clear notification that the USDOC 
intended to use, or was cons idering to use, the volume of raw olives purchased for processing  into 
ripe olives  in its calculation of the subsidy margin, particularly in the absence of any explanation as 
to why the USDOC wanted to verify the listed information.  
7.399.   Finally, we recall that  the United  States  submits that the written and oral advocacy 
presented by the interested parties between the preliminary  and final determination s evidences  that 
the necessary disclosure of essential facts took place in time for the respondents to defend t heir 
interests.829 
7.400.   As the United  States points out, prior to the final determination  the petitioner asked the 
USDOC to modify the methodology it had used to determine the respondents'  preliminary subsidy 
margins, and to use instead a "ripe olives -only metho dology".830 The respondents (including 
Aceitunas Guadalquivir ), urged the USDOC to reject the petitioner's  request on both factual and 
legal grounds.831 We see nothing in the reasons and arguments advanced by the respondents to 
suggest that the USDOC had previously disclosed that the volume of purchases of raw olives 
processed into ripe olives was an "essential fact  under consideration" for the purpose of  its final 
determination  of the respondents'  margins of subsidization. We note, for example, that the 
respondents'  submissions make no reference to any prior statements or specific requests made by 
the USDOC that would suggest that they had been informed o f this possibility. Rather, the 
respondents'  rebuttal is focused entirely on addressing the reasons advanced in the 
petitioner's  request. In our view, the exchange between the petitioner and the respondents, in the 
light of the preceding events in the unde rlying investigation, does not demonstrate that the USDOC  
had previously disclosed  that it would use, or was in fact considering to use, a ripe olives -only 
methodology, or, in other words, that the USDOC  had previously disclosed  that the volume of 
purchase s of raw olives processed into ripe olives was an "essential fact  under consideration " for the 
purpose of Aceitunas Guadalquivir 's final subsidy margin.  
7.401.   For the foregoing reasons, we find that the 4  August  2017 questionnaire and 
27 September  2017 memorand um, and the USDOC 's 9 February  2018 verification agenda s and 
verification report s sent to the respondents, did not inform the respondents that the volume of 
purchases of raw olives processed into ripe olives  were " essential facts under consideration " within 
the meaning of Article  12.8. Accordingly, by failing to provide this information, we find that the 
USDOC acted inconsistently with the United  States'  obligations under Article  12.8 of the 
SCM Agreement.  
7.5.6   Conclusion  
7.402.   In relation to the European  Union's  substantive claims, we find that the USDOC acted 
inconsistently with the United  States'  obligations under Article  VI:3 of the  GATT  1994 because:  
a. by relying  on the volume of Aceitunas Guadalquivir's  raw olive purchases reported in its 
response to the initial 4  August  2017 questionnaire to determine  Aceitunas 
Guadalquivir's  final subsidy margin and countervailing duty rate, the USDOC did not  
 
827 United  States'  first written submission, para.  331 (referring to Aceitunas Guadalquivir  verification 
report, (Exhibit  USA-22), pp.  6-8). 
828 Aceitunas Guadalquivir  verification report, (Exhibit  USA-22), p.  7. 
829 United  States'  first written submission, para.  332. 
830 Case brief of petitioner  in Countervailing Duty Investigation of Ripe Olives from Spain 
(23 April 2018), (Exhibit  USA-20), p p. 6-12. 
831 Rebuttal brief, (Ex hibit USA-24), pp.  6-9. WT/DS 577/R  
BCI deleted, as indicated [[ ***]] 
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  ensure, and take the necessary steps to ascertain as accurately as possible the amount of 
subsidization bestowed on the investigated products ; and 
b. the USDOC relied upon the margin of subsidization incorrectly determined for Aceitunas 
Guadalquivir  in its determination of the "all others" rate of countervailing duties imposed 
on exporters of ripe olives that were not individu ally investigated.  
7.403.   In the light of our findings with respect to the European  Union's  claims under Article  VI:3, 
we do not believe that making further findings on the merits of the European  Union's  complaint that 
the same USDOC actions are also inconsistent  with Articles  10, 19.1, 19.3, 19.4 , and 32.1 of the 
SCM Agreement would contribute to achieving a positive solution of this dispute. Accordingly, we 
decline to make findings with respect to these claims.  
7.404.   In relation to the European  Union's  procedural cla ims, we find that the USDOC acted 
inconsistently with the United  States'  obligations under:  
a. Article  12.1 of the SCM  Agreement because the USDOC failed to notify the respondents 
that the USDOC required information regarding the volume of purchases of raw ol ives 
processed into ripe olives ; and 
b. Article  12.8 of the SCM  Agreement because the USDOC failed to inform interested parties 
before the final determination  that the volume of purchases of raw olives processed into 
ripe olives was an "essential fact under c onsideration".  
8  CONCLUSIONS  AND RECOMMENDATION  
8.1.  For the reasons set forth in this Report, the Panel concludes as follows:  
a. With respect to the European  Union's  claims regarding the USDOC's de jure  specificity 
determination : 
i. the European  Union has demonstrated  that the USDOC's 29  May 2020 Remand 
Redetermination as it relates to the USDOC's original findings of de jure specificity  is 
a measure or is part of the measure that is before the Panel in this dispute ; 
ii. the European  Union has not demonstrated  that the USDOC  acted inconsistently with 
Articles  2.1 and 2.1(a) of the SCM  Agreement merely because the USDOC based its 
findings of de jure  specificity in the ripe olives countervailing duty investigation on the 
rules in the relevant subsidy programmes govern ing the calculation of the amounts of 
subsidies available to eligible enterprises ; 
iii. the European  Union has not demonstrated  that the USDOC  acted inconsistently with 
Article  2.1(a) of the SCM  Agreement because the USDOC's  determination of de jure 
specificity  was dependent upon how certain alleged features of past subsidy 
programmes  no longer in force  were relied upon and integrated into the 
BPS programme ; 
iv. the European  Union has not demonstrated that, as a matter of fact, the USDOC found 
that the BPS/GP and SPS subsidies were de jure  specific to olive growers as a result 
of being coupled or tied to olive production;  
v. the USDOC acted inconsistently with Articles  2.1, 2.1(a), and 2.4 of the 
SCM Agreement because:  
(1)  the USDOC did not properly examine and account for the rules governing the 
allocation and valuation of BPS entitlements with respect to new farmers, 
farmers holding entitlements transferred under the SPS  programme, and 
farmers no lo nger growing olives;  WT/DS577/R  
BCI deleted, as indicated [[***]]  
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  (2)  the USDOC relied upon erroneous factual findings with respect to function 
and role of the so called "regional rate" to support its determination of de jure 
specificity; and  
(3)  the USDOC did not properly examine and account for the rules governing the 
allocation and valuation of SPS entitlements with respect to farmers with 
SPS entitlements obtained via transfer, and farmers holding 
COMOF  programme -based entitlements no longer producing olives.  
For the reasons set out in (v)(1) -(3), the USDOC's determination of de jure  specificity 
was not based on a reasoned and adequate explanation of why access to the BPS and 
SPS subsidies was explicitly limited to olive growers, within the meaning of Articles  2.1 
and 2.1(a) of the SCM  Agreement , and was not clearly substantiated on the basis of 
positive evidence, as required by Article  2.4 of the SCM  Agreement;  
vi. the USDOC acted inconsistently with Article  2.4 of the SCM  Agreement to the extent 
that the USDOC's determinations of de jure  specificit y with respect to the SPS and 
BPS/GP subsidies relied upon an erroneous factual finding concerning the calculation 
of assistance under the COMOF programme832; 
vii. the European  Union has  not demonstrated that the USDOC  acted inconsistently with  
Articles  2.1, 2.1(a), and 2.4 of the SCM  Agreement because, contrary to the 
European  Union's  assertions : 
(1) the USDOC's rejection of the arguments concerning the application of the 
convergence factor under the BPS  programme  was supported by record 
evidence, and to this  extent, reasonably and adequately explained and based 
on clearly substantiated positive evidence;  
(2)  the totality of the USDOC's discussion of the rules governing the calculation 
of SPS payments reveals that the USDOC correctly understood that 
SPS payme nts were made to farmers and that Spain did not implement the 
SPS programme  on a regional basis; and  
(3)  the lack of a formal specificity finding under US law does not undermine the 
USDOC's  determinations of de jure  specificity with respect to the SPS, BP S, 
and GP  programmes , given the absence of any suggestion on the part of the 
European  Union that the COMOF programme subsidies were not de jure 
specific, and in the light of the fact that the USDOC considered it had  made 
sufficient factual findings to satisfy itself that those subsidies would be de jure 
specific under its domestic legislation, had it been required to make such a 
determination . 
viii. given our findings at paragraphs 8.1.a.v and vi, the Panel declines to mak e further 
findings under Articles  1.2, 2.1, 2.1(a),  2.1(b) , and 2.4 of the SCM  Agreement.  
b. With respect to the European  Union's  claims in relation  to Section  771B of 
the Tariff Act of 1930  and its application  in the ripe olives  countervailing  duty 
investigation : 
i. Section 771B of the Tariff Act of 1930 is as such inconsistent with Article  VI:3 of 
the GATT  1994 and Article  10 of the SCM  Agreement because it requires the USDOC 
to presume that the entire benefit of a subsidy provided in respect of a raw agricultural 
input product passes through to the downstream processed agricultural product, based 
on a consideration of only two factual circumstances, without leaving open the 
possibility of taking into account any other factors that may be relevant to th e 
determination of whether there is any pass -through and, if so, its degree ; 
 
832 See para.  7.127 (d) above.  WT/DS 577/R  
BCI deleted, as indicated [[ ***]] 
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  ii. the USDOC acted inconsistently with Article  VI:3 of the  GATT  1994 and Article  10 of 
the SCM  Agreement  regarding its application of Section  771B of the Tariff Act of 1930 
in the Sp anish ripe olives countervailing duty investigation because it failed to establish 
the existence and extent of indirect subsidization taking into account all relevant facts 
and circumstances ; and 
iii. given our findings at paragraphs  8.1.b.i and ii, the Panel declines to make further 
findings under Articles  19.1, 19.3, 19.4 , and 32.1 of the SCM  Agreement , either with 
respect to Section  771B of the Tariff Act of 1930  as such  or the US DOC's application 
of Section  771B of the Tariff Act of 1930 in the in  the Spanish ripe olives countervailing 
duty investigation . 
c. With respect to the European  Union's  claims regarding the USITC's  Injury Determination:  
i. with respect to the United States' request for a preliminary ruling, the United States  
has not demonstrated that the European  Union 's claims under Article  15.4 of the 
SCM Agreement and Article  3.4 of the Anti -Dumping  Agreement are not properly 
before the Panel ; 
ii. the European  Union has not demonstrated  that the USITC acted inconsistently with 
Articles  15.1 and 15.2 of the SCM  Agreement, and Articles  3.1 and 3.2 of the 
Anti-Dumping  Agreement, by failing to undertake an analysis of the volume of ripe 
olives from Spain based on an objective examination of positive evidence ; 
iii. the European  Union has not demonstrated  that the USITC acted inconsistently with 
Articles  15.1 and 15.2 of the SCM  Agreement, and Articles  3.1 and 3.2 of the 
Anti-Dumping  Agreement, by failing to consider a "volume effect" within the mea ning 
of Article  15.2 of the SCM  Agreement and Article  3.2 of the Anti -Dumping  Agreement ; 
iv. the European  Union has not demonstrated  that the USITC acted inconsistently with 
Articles  15.1 and 15.2 of the SCM  Agreement, and Articles  3.1 and 3.2 of the 
Anti-Dump ing Agreement, by failing to undertake an analysis of the price effects of 
ripe olives from Spain that was based on an objective examination of positive 
evidence ; 
v. given our findings at paragraphs c.ii-iv, the European  Union has not demonstrated that 
the US ITC acted inconsistently with Articles  15.4 and 15.5 of the SCM  Agreement, and 
Articles  3.4 and 3.5 of the Anti -Dumping  Agreement, as a consequence of alleged 
violations concerning the USITC's  volume analysis and price effects analysis ; 
vi. the European  Union has not demonstrated  that the USITC acted inconsistently with 
Articles  15.1 and 15.4 of the SCM  Agreement, and Articles  3.1 and 3.4 of the 
Anti-Dumping  Agreement, by failing to undertake an analysis of the consequent impact 
of ripe olives fr om Spain on the domestic industry that was based on an objective 
examination of positive evidence ; 
vii. given our findings at paragraph c.vi, the European  Union has not demonstrated that 
the USITC acted inconsistently with Article  15.5 of the SCM  Agreement, and  Article  3.5 
of the Anti -Dumping  Agreement, as a consequence of alleged violations concerning the 
USITC's  impact analysis ; and  
viii. the European  Union has not demonstrated that the USITC acted inconsistently with 
Articles  15.1 and 15.5 of the SCM  Agreement, and  Articles  3.1 and 3.5 of the 
Anti-Dumping  Agreement, by failing to undertake a causation analysis that was based 
on an objective examination of positive evidence.  
d. With respect to the European  Union's  claims concerning Aceitunas Guadalquivir 's final 
subsidy margin and countervailing  duty rate calculation : 
i. the USDOC acted inconsistently with Article  VI:3 of the GATT 1994 because, by relying 
on the volume of Aceitunas Guadalquivir's  raw olive purchases reported in its response WT/DS577/R  
BCI deleted, as indicated [[***]]  
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  to the initial 4  August  2017 questionnaire to determine  Aceitunas Guadalquivir's  final 
subsidy margin and countervailing duty rate, the USDOC did not ensure, and take the 
necessary steps to ascertain as accurately as possible the amount of subsidization 
bestowed on the investigated  products ; 
ii. the USDOC acted inconsistently with Article  VI:3 of the GATT 1994 because the USDOC 
relied upon the margin of subsidization incorrectly determined for 
Aceitunas  Guadalquivir in its determination of the "all  others" rate of countervailing 
duties imposed on exporters of ripe olives that were not individually investigated;  
iii. given our findings at paragraphs 8.1. d.i and ii, the Panel declines to make further 
findings that the same USDOC actions are also inconsistent with Articles  10, 19.1, 
19.3, 19.4 a nd 32.1 of the SCM  Agreement ; 
iv. the USDOC acted inconsistently with Article  12.1 of the SCM  Agreement because the 
USDOC failed to notify the respondents that the USDOC required information regarding 
the volume of purchases of raw olives processed into ripe o lives; and  
v. the USDOC acted inconsistently with Article  12.8 of the SCM  Agreement because the 
USDOC failed to inform interested parties before the final determination that the 
volume of purchases of raw olives processed into ripe olives was an "essential fact 
under consideration".  
8.2.  Under Article  3.8 of the DSU, in cases where there is an infringement of the obligations 
assumed under a covered agreement, the action is considered prima facie  to constitute a case of 
nullification or impairment. We c onclude that, to the extent that the measures at issue are 
inconsistent with the GATT 1994, the SCM  Agreement and Anti -Dumping  Agreement, they have 
nullified or impaired benefits accruing to the European  Union under that agreement.  
8.3.  Pursuant to Article  19.1 of the DSU, we recommend that the United  States bring its measures 
into conformity with its obligations under the  GATT  1994, the SCM  Agreement , and the 
Anti-Dumping  Agreement.  
__________