WT/DS539/R  
 
21 January 2021  
(21-0619) Page: 1/217 
  Original:  English  
 
  
UNITED  STATES  – ANTI -DUMPING AND COUNTERVAILING DUTIES ON 
CERTAIN PRODUCTS AND THE USE OF FACTS AVAILABLE  
REPORT OF THE PANEL  
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 WT/DS539/ R 
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  TABLE OF CONTENTS  
1   INTRODUCTION  ................................ ................................ ................................ ....... 20 
1.1   Complaint by Korea  ................................ ................................ ................................ .. 20 
1.2   Panel establishment and composition  ................................ ................................ ..........  20 
1.3   Panel proceedings  ................................ ................................ ................................ ..... 20 
1.3.1    General  ................................ ................................ ................................ ................  20 
1.3.2    Working Procedures on Business Confidential Information  ................................ ...........  21 
1.3.3    Preliminary ruling request  ................................ ................................ .......................  21 
2   FACTUAL ASPECTS ................................ ................................ ................................ .... 21 
2.1   The measures at issue  ................................ ................................ ..............................  21 
3   PARTIES'  REQUEST S FOR FINDINGS AND RECOMMENDATIONS  ...............................  24 
4   ARGUMENTS OF THE PARTIES  ................................ ................................ ..................  25 
5   ARGUMENTS OF THE THIRD PARTIES  ................................ ................................ ....... 25 
6   INTERIM REVIEW  ................................ ................................ ................................ ..... 25 
7   FINDINGS  ................................ ................................ ................................ ................  25 
7.1   General issues  ................................ ................................ ................................ .........  26 
7.1.1    Treaty interpretation  ................................ ................................ ..............................  26 
7.1.2    Burden of proof  ................................ ................................ ................................ ..... 26 
7.1.3    Standard(s)  of rev iew ................................ ................................ .............................  27 
7.2   Interpretative framework ................................ ................................ ...........................  29 
7.2.1    Anti-Dumping  Agreement  ................................ ................................ .......................  30 
7.2.2    SCM Agreement  ................................ ................................ ................................ ..... 34 
7.2.3    "Best information available" and "comparative evaluation"  ................................ ..........  35 
7.3   Korea's  "as applied" claims  ................................ ................................ ........................  37 
7.3.1    Anti-dumping duties on certain corrosion -resistant steel products from Korea 
(USDOC investigation number A -580-878) ................................ ................................ ..........  37 
 Introduction  ................................ ................................ ................................ ....... 37 
 Factual background  ................................ ................................ .............................  38 
 Main argum ents of the parties  ................................ ................................ ..............  40 
 Evaluation by the Panel  ................................ ................................ .......................  42 
7.3.1.4.1    The USDOC's  resort to facts available  ................................ ................................ . 42 
7.3.1.4.2    The USDOC's  selection of the replacement facts  ................................ ...................  47 
 Korea's  claims under Articles  1, 9.3, and 18.1 of the Anti -Dumping  Agreement  ..........  48 
7.3.2    Anti-dumping duties on certain cold -rolled steel flat products from Korea 
(USDOC  investigation number A -580-881) ................................ ................................ ..........  48 
 Introduction  ................................ ................................ ................................ ....... 48 
 Affiliated party transactions  ................................ ................................ ..................  49 
7.3.2.2.1    Factual background  ................................ ................................ ..........................  49 
7.3.2.2.2    Main arguments of the parties  ................................ ................................ ...........  51 
7.3.2.2.3    Evaluation by the Panel  ................................ ................................ .....................  54 
7.3.2.2.3.1    The USDOC's  resort to facts available  ................................ ..............................  54 WT/DS539/ R 
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  7.3.2.2.3.2    The USDOC's  selection of the replacement facts  ................................ ................  63 
 Alleged misreporting of control numbers (CONNUMs)  ................................ ..............  64 
7.3.2.3.1    Factual background  ................................ ................................ ..........................  64 
7.3.2.3.2    Main arguments of the parties  ................................ ................................ ...........  68 
7.3.2.3. 3   Evaluation by the Panel  ................................ ................................ .....................  70 
7.3.2.3.3.1    The USDOC's  resort to facts available  ................................ ..............................  70 
7.3.2.3.3.2    The USDOC's  selection of the replacement facts  ................................ ................  74 
 Korea's  claims under Articles  1, 9.3, and 18.1 of the Anti -Dumping  Agreement  ..........  75 
7.3.3    Anti-dumping duties on certain hot -rolled steel flat products from Korea 
(USDOC  investigation number A -580-883) ................................ ................................ ..........  76 
 Introduction  ................................ ................................ ................................ ....... 76 
 Factual background  ................................ ................................ .............................  76 
 Main arguments of the parties  ................................ ................................ ..............  78 
 Evaluation by the Panel  ................................ ................................ .......................  80 
7.3.3.4.1    The USDOC's  resort to facts available  ................................ ................................ . 80 
7.3.3.4.2    The USDOC's  selection of the replacement facts  ................................ ...................  86 
 Korea's  claims under Articles  1, 9.3, and 18.1 of the Anti -Dumping  Agreement  ..........  87 
7.3.4    Countervailing duties on certain cold -rolled steel flat products from Korea 
(USDOC  investigation number C -580-882) ................................ ................................ ..........  87 
 Introduction  ................................ ................................ ................................ ....... 87 
 Factual background  ................................ ................................ .............................  88 
7.3.4.2.1    The USDOC's  resort to facts available  ................................ ................................ . 88 
7.3.4.2.1.1    Cross -owned affiliate input suppliers  ................................ ................................  88 
7.3.4.2.1.2    POSCO facility in an FEZ  ................................ ................................ .................  89 
7.3.4.2.1.3    DWI loan data  ................................ ................................ ...............................  90 
7.3.4.2.2    The USDOC's  selection of the replacement facts  ................................ ...................  91 
 Main arguments of the parties  ................................ ................................ ..............  92 
7.3.4.3.1    The USDOC's  resort to facts available  ................................ ................................ . 92 
7.3.4.3.1.1    Cross -owned affiliate input suppliers  ................................ ................................  92 
7.3.4.3.1.2    POSCO facility in an FEZ  ................................ ................................ .................  94 
7.3.4.3.1.3    DWI loan data  ................................ ................................ ...............................  96 
7.3.4.3.2    The USDOC's  selection of the replacement facts  ................................ ...................  97 
 Evaluation by the Panel  ................................ ................................ .......................  98 
7.3.4.4.1    The USDOC's  resort to facts available  ................................ ................................ . 98 
7.3.4.4.1.1    Cross -owned affiliate input suppliers  ................................ ................................  99 
7.3.4.4.1.2    POSCO facility in an FEZ  ................................ ................................ ...............  101 
7.3.4.4.1.3    DWI loan data  ................................ ................................ .............................  104 
7.3.4.4.2   The USDOC's  selection of the replacement facts  ................................ .................  106 
7.3.4.4.2.1    Cross -owned affiliate input suppliers  ................................ ..............................  106 
7.3.4.4.2.2    POSCO facility in an FEZ  ................................ ................................ ...............  109 
7.3.4.4.2.3    DWI loan data  ................................ ................................ .............................  109 WT/DS539/ R 
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 Korea's  claims under Articles  10, 19.4, and 32.1 of the SCM  Agreement  ..................  109 
7.3.5    Countervailing duties on certain hot -rolled steel flat products from Korea 
(USDOC  investigation number C -580-884) ................................ ................................ ........  110 
 Introduction  ................................ ................................ ................................ ..... 110 
 Factual background  ................................ ................................ ...........................  110 
7.3.5.2.1    The USDOC's  resort to facts available  ................................ ...............................  111 
7.3.5.2.1.1    Cross -owned affiliate input suppliers  ................................ ..............................  111 
7.3.5.2.1.2    POSCO facility in an FEZ  ................................ ................................ ...............  113 
7.3.5.2.1.3    DWI loan data  ................................ ................................ .............................  114 
7.3.5.2.2    The USDOC's  selection of the replacement facts  ................................ .................  114 
 Main arguments of the parties  ................................ ................................ ............  115 
7.3.5.3.1    The USDOC's  resort to facts available  ................................ ...............................  115 
7.3.5.3.1.1    Cross -owned affiliate input suppliers  ................................ ..............................  115 
7.3.5.3.1.2    POSCO facility in an FEZ  ................................ ................................ ...............  116 
7.3.5.3.1.3    DWI loan data  ................................ ................................ .............................  117 
7.3.5.3.2    The USDOC's  selection of the replacement facts  ................................ .................  117 
 Evaluation by the Panel  ................................ ................................ .....................  118 
7.3.5.4.1    The USDOC's  resort to facts available  ................................ ...............................  118 
7.3.5.4.1.1    Cross -owned affiliate input suppliers  ................................ ..............................  118 
7.3.5.4.1.2    POSCO facility in an FEZ  ................................ ................................ ...............  120 
7.3.5.4.1.3    DWI loan data  ................................ ................................ .............................  121 
7.3.5.4.2    The USDOC's  selection of the replacement facts  ................................ .................  122 
 Korea's  claims under Articles  10, 19.4, and 32.1 of the SCM  Agreement  ..................  122 
7.3.6    Anti-dumping d uties on large power transformers from Korea (USDOC 
investigation number A -580-867) ................................ ................................ ....................  123 
 Introduction  ................................ ................................ ................................ ..... 123 
 The second administrative review (POR2)  ................................ ............................  124 
7.3.6.2.1    Introduction  ................................ ................................ ................................ .. 124 
7.3.6.2.2    Factual background  ................................ ................................ ........................  124 
7.3.6.2.3    Main arguments of the parties  ................................ ................................ .........  127 
7.3.6.2.4    Evaluation by the Panel  ................................ ................................ ...................  129 
7.3.6.2.4.1    The USDOC's  resort to facts available  ................................ ............................  129 
7.3.6.2.4.2    The USDOC's  selection of the replacement facts  ................................ ..............  132 
 The third administrative review (POR3)  ................................ ...............................  133 
7.3.6.3.1    Introduction  ................................ ................................ ................................ .. 133 
7.3.6.3. 2   The USDOC's  resort to facts available  ................................ ...............................  133 
7.3.6.3.2.1    Service -related revenues  ................................ ................................ ..............  133 
7.3.6.3.2.2    Alleged understatement of home -market prices  ................................ ..............  139 
7.3.6.3.2.3    Accessories  ................................ ................................ ................................ . 143 
7.3.6. 3.2.4   Certain sales documentation  ................................ ................................ .........  147 
7.3.6.3.3    The USDOC's  selection of the replacement facts  ................................ .................  150 WT/DS539/ R 
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  7.3.6.3.3.1    Factual background  ................................ ................................ .....................  150 
7.3.6.3.3.2    Main arguments of the parties  ................................ ................................ ....... 150 
7.3.6.3.3.3    Evaluation by the Panel  ................................ ................................ ................  151 
 The fourth administrative review (POR4)  ................................ ..............................  151 
7.3.6.4.1    Introduction  ................................ ................................ ................................ .. 151 
7.3.6.4.2    HHI ................................ ................................ ................................ ..............  151 
7.3.6.4.2.1    Accessories  ................................ ................................ ................................ . 151 
7.3.6. 4.2.2   Gross unit price for certain home market sales  ................................ ................  156 
7.3.6.4.2.3    US sales agent  ................................ ................................ ............................  160 
7.3.6.4.3    Hyosung  ................................ ................................ ................................ ....... 163 
7.3.6.4.3.1    Service -related revenues  ................................ ................................ ..............  163 
7.3.6.4.3.2    Invoice covering multiple US sales  ................................ ................................ . 167 
7.3.6.4.3.3    Discounts and price adjustments  ................................ ................................ ... 170 
7.3.6.4.4    The USDOC's  selection of the replacement facts for HHI and Hyosung  ..................  173 
7.3.6.4.4.1    Factual background  ................................ ................................ .....................  173 
7.3.6.4.4.2    Main arguments of the parties  ................................ ................................ ....... 173 
7.3.6.4.4.3    Evaluation by the Panel  ................................ ................................ ................  173 
7.3.6.4.5    The USDOC's  selection of an "all others" rate  ................................ .....................  173 
7.3.6.4.5.1    Factual background  ................................ ................................ .....................  173 
7.3.6.4.5.2    Main arguments of the parties  ................................ ................................ ....... 174 
7.3.6.4.5.3    Evaluation by the Panel  ................................ ................................ ................  174 
 Korea's  claims under Articles  1, 9.3, and 18.1 of the Anti -Dumping  Agreement  ........  176 
7.4   Korea's  "as such" claim  ................................ ................................ ...........................  177 
7.4.1    Preliminary ruling  ................................ ................................ ................................  177 
 Article  6.2 of the DSU  ................................ ................................ ........................  179 
 Whether Korea's  panel request is consistent with Article  6.2 of the DSU  ..................  180 
 Conclusion  ................................ ................................ ................................ ....... 181 
7.4.2    "As such" claim against the alleged unwritten measure  ................................ .............  181 
7.4.3    The measure at issue  ................................ ................................ ...........................  182 
 Introduction  ................................ ................................ ................................ ..... 182 
 The precise content of the alleged unwritten measure  ................................ ...........  183 
 The legal characterization of the alleged unwritten measure  ................................ ... 186 
7.4.4    Korea's  reliance on prior WTO disputes  ................................ ................................ ... 186 
7.4.5    Whether Korea has established the ex istence of the AFA rule or a norm with the 
precise content alleged by it  ................................ ................................ ............................  189 
 Written instruments and rulings  ................................ ................................ ..........  190 
7.4.5.1.1    Statutory provisions of US law  ................................ ................................ .........  190 
7.4.5.1.2    USDOC Anti -Dumping Manual  ................................ ................................ ..........  195 
7.4.5.1.3    Rulings by US courts  ................................ ................................ ......................  196 
 The USDOC's  alleged "practice"  ................................ ................................ ..........  197 
 The nature of an "as such" claim  ................................ ................................ .........  204 WT/DS539/ R 
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 Conclusion regarding the "AFA rule or norm"  ................................ ........................  206 
7.4.6    Whether Korea has established the existence of the AFA ongoing conduct with the 
precise content alleged by it  ................................ ................................ ............................  206 
7.4.7    Overall conclusion  ................................ ................................ ................................  210 
8   CONCLUSIONS AND RECOMMENDATION  ................................ ................................  211  
 
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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 on Business Confidential Information  11 
Annex  A-3 Preliminary ruling of the Panel  13 
Annex  A-4 Interim Review   15 
ANNEX B  
ARGUMENTS OF THE PARTIES  
Contents  Page  
Annex  B-1 Integrated executive summary of the arguments of Korea  28 
Annex  B-2 Integrated executive summary of the arguments of the United  States  41 
ANNEX C  
ARGUMENTS OF THE THIRD PARTIES  
Contents  Page  
Annex  C-1 Integrated executive summary of the arguments of Brazil  56 
Annex  C-2 Integrated executive summary of the arguments of Canada  58 
Annex  C-3 Integrated executive summary of the arguments of the European Union  61 
Annex  C-4 Integrated executive summary of the arguments of Japan  64 
Annex  C-5 Integrated executive summary of the arguments of Mexico  69 
Annex  C-6 Integrated executive summary of the arguments of Norway  72 
 
 
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  CASES CITED IN THIS REPORT  
Short Title  Full Case Title and Citation  
Argentina – Import 
Measures  Appellate Body Reports, Argentina – Measures Affecting the 
Importation of Goods , WT/DS438/AB/R  / WT/DS444/AB/R  / 
WT/DS445/AB/R , adopted 26  January 2015, DSR 2015:II, p. 579 
Argentina – Poultry 
Anti-Dumping Duties  Panel Report, Argentina – Definitive Anti -Dumping Duties on Poultry 
from Brazil , WT/DS241/R , adopted 1 9 May 2003, DSR 2003:V, 
p. 1727 
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 
Australia – Salmon  Appellate Body Report, Australia – Measures Affecting Importation of 
Salmon , WT/DS18/AB/R , adopted 6 November 1998, 
DSR 1998:VIII, p. 3327  
Canada – Welded Pipe  Panel Report, Canada – Anti-Dumping Measures on Imports of 
Certain Carbon Steel Welded Pipe from the Separate Customs 
Territory of Taiwan, Penghu, Kinmen and Matsu , WT/DS482/R  and 
Add.1, adopted 25 January 2017, DSR 2017:I, p. 7 
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 
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 Product s 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  
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 
China – Publications and 
Audiovisual Products  Appellate Body Report, China – Measures Affecting Trading Rights 
and Distribution Services for Certain Publications and Audiovisual 
Entertainment Products , WT/DS363/AB/R , adopted 
19 January  2010, DSR 2010:I, p. 3 
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 
EC – Bed Linen 
(Article  21.5 – India)  Appellate Body 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/AB/RW , adopted 
24 April 2003, DSR 2003:III, p. 965 WT/DS539/ R 
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  Short Title  Full Case Title and Citation  
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 – 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 – Salmon (Norway)  Panel Report, European Communities – Anti-Dumping Measu re on 
Farmed Salmon from Norway , WT/DS337/R , adopted 
15 January  2008, and C orr.1, DSR 2008:I, p. 3 
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  Appellate Body Report, European Communities – Anti-Dumping 
Duties on Malleable Cast Iron Tube or Pipe Fittings from Brazil , 
WT/DS219/AB/R , adopted 18 August 2003, DSR 2003:VI, p. 2613 
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 – Footwear (Chin a) Panel Report, European Union – Anti-Dumping Measures on Certain 
Footwear from China , WT/DS405/R , adopted 22 February 2012, 
DSR 2012:IX, p. 4585 
Guatemala – Cement  II Panel Report, Guatemala – Definitive Anti -Dumping Measures on 
Grey Portland Cement from Mexico , WT/DS156/R , adopted 
17 November 2000, DSR 2000:XI, p. 5295 
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 – Iron or Steel 
Products  Appellate Body Report, Indonesia – Safeguard on Certain Iron or 
Steel Products , WT/DS490/AB/R , WT/DS496/AB/R , and Add.1, 
adopted 27 August 2018  
Japan – Alcoholic 
Beverages II  Appellate Body Report, Japan – Taxes o n Alcoholic Beverages , 
WT/DS8/AB/R , WT/DS10/AB/R , WT/DS11/AB/R , adopted 
1 November 1996, DSR 1996:I, p. 97 
Korea – Certain Paper 
(Article  21.5 – 
Indonesia)  Panel Report, Korea – Anti-Dumping Duties on Imports of Certain 
Paper from Indonesia – Recourse to Article  21.5 of the DSU by 
Indonesia , WT/DS312/RW , adopted 22 October 2007, 
DSR 2007:VIII, p. 3369 
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  
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  WT/DS539/ R 
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  Short Title  Full Case Title and Citation  
Mexico – Anti-Dumping 
Measures on Rice  Panel Report, Mexico – Definitive Anti -Dumping Measures on Beef 
and Rice, Complaint with Respect to Rice , WT/DS295/R , adopted 
20 December 2005, as modified by Appellate Body Report 
WT/DS295/AB/R, DSR 2005:XXIII, p. 11007  
Mexico – Steel Pipes and 
Tubes  Panel Report, Mexico – Anti-Dumping Duties on Steel Pipes and 
Tubes from Guatemala , WT/DS331/R , adopted 24 July 2007, 
DSR 2007:IV, p. 1207 
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  
Russia – Railway 
Equipment  Appellate Body Report, Russia – Measures Affecting the I mportation 
of Railway Equipment and Parts Thereof , WT/DS499/AB/R  and 
Add.1, adopted 5 March 2020  
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 
US – Anti-Dumpi ng 
Methodologies (China)  Appellate Body Report, United States – Certain Methodologies and 
Their Application to Anti -Dumping Proceedings Involving China , 
WT/DS471/AB/R  and Add.1, adopted 22 May 2017, DSR 2017:III, 
p. 1423 
US – Anti-Dumping 
Methodologies (China)  Panel Report, United States – Certain Methodologies and Their 
Application to Anti -Dumping Proceedings Involving China , 
WT/DS471/R  and Add.1, adopted 22 May 2017, as modified by 
Appellate Body Report WT/DS471/AB/R, DSR 2017:IV, p. 1589 
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)  Panel Report, United States – Countervailing Measures on Certain 
Hot-Rolled Carbon Steel Flat Products from India , WT/DS436/R  
and Add.1, adopted 19 December 2014, as modified by 
Appellate  Body Report WT/DS436/AB/R, DSR 2014:VI, p. 2189 
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 – 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 
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 WT/DS539/ R 
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  Short Title  Full Case Title and Citation  
US – Differential Pricing 
Methodology  Panel Report, United States – Anti-Dumping Measures Applying 
Differential Pricing Methodology to Softwood Lumber from Canada , 
WT/DS534/R  and Add.1, circulated to WTO Membe rs 9 April 2019 
[appealed by Canada 4 June 2019 – the Division suspended its work 
on 10 December 2019]  
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 
US – Hot-Rolled Steel  Appellate Body Report, United States – Anti-Dumping Measures o n 
Certain Hot -Rolled Steel Products from Japan , WT/DS184/AB/R , 
adopted 23  August 2001, DSR 2001:X, p. 4697 
US – Hot-Rolled Steel  Panel Report, United States – Anti-Dumping Measures on Certain 
Hot-Rolled Steel Products from Japan , WT/DS184/R , adopted 
23 August 2001 modified by Appellate Body Report 
WT/DS184/ AB/R, DSR 2001:X, p. 4769 
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 – Lead and Bismuth II  Appellate Body Report, United States – Imposition of Countervailing 
Duties on Certain Hot -Rolled Lead and Bismuth Carbon Steel 
Products Originating in the United Kingdom , WT/DS138/AB/R , 
adopted 7 June 2000, DSR 2000:V, p. 2595 
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 – Orange  Juice 
(Brazil)  Panel Report, United States – Anti-Dumping Administrative Reviews 
and Other Measures Related to Imports of Certain Orange Juice from 
Brazil , WT/DS382/R , adopted 17 June 2011, DSR 2011:VII, p. 3753 
US – Shrimp (Viet Nam)  Panel Report, United States – Anti-Dumping Measures on Certain 
Shrimp from Viet Nam , WT/DS404/R , adopted 2 September 2011, 
DSR 2011:X, p. 5301 
US – Softwood Lumbe r 
VI (Article  21.5 – 
Canada)  Appellate Body Report, United States – Investigation of the 
International Trade Commission in Softwood Lumber from Canada – 
Recourse to Article  21.5 of the DSU by Canada , WT/DS277/AB/RW , 
adopted 9 May 2006, and Corr.1, DSR 2006:XI, p. 4865 
US – Steel Plate  Panel Report, United States – Anti-Dumpi ng and Countervailing 
Measures on Steel Plate from India , WT/DS206/R  and Corr.1, 
adopted 29 July 2002, DSR 2002:VI, p. 2073 
US – Supercalendered 
Paper  Appellate Body Report, United States – Countervailing Measures on 
Supercalendered Paper from Canada , WT/DS505/AB/R  and Add.1, 
adopted 5 March 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 – 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 WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 12 - 
 
  Short Title  Full Case Title and Citation  
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 19 97:I, p. 323 
US – Zeroing (EC)  Appellate Body Report, United States – Laws, Regulations and 
Methodology for Calculating Dumping Margins ("Zeroing") , 
WT/DS294/AB/R , adopted 9 May 2006, and Corr.1, DSR 2006:II, 
p. 417 
US – Zeroing (EC) 
(Article  21.5 – EC) Appellate Body Report, United States – Laws, Regulations and 
Methodology for Calculating Dumping Margins ("Zeroing") – 
Recourse to Article  21.5 of the DSU by the European Communities , 
WT/DS294/AB/RW  and Corr.1, adopted 11 June 2009, 
DSR 2009:VII, p. 2911 WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 13 - 
 
  EXHIBITS REFERRED TO IN THIS REPORT  
Exhibit  Short Title (if any)  Description  
KOR-2 (BCI)  CORE Section  A questionnaire 
response  CORE Section  A questionnaire response 
(4 September  2015)  
KOR-3  19 U.S.C. § 1677a  
KOR-4  CFR § 351.402(c)  
KOR-5 CORE issues and decision 
memorandum  CORE issues and decision memorandum (24  May 2016)  
KOR-6 CORE anti -dumping 
questionnaire to Hyundai 
Steel CORE anti -dumping questionnaire to Hyundai Steel 
(27 July 2015)  
KOR-7 (BCI)  Hyundai Steel exclusion 
request  Hyundai Steel exclusion request (17  August  2015)  
KOR-9 USDOC teleconference with 
Hyundai Steel  USDOC teleconference with Hyundai Steel 
(14 September  2015)  
KOR-10 (BCI)  CORE response to request for 
additional information  CORE response to request for addit ional information 
(25 September  2015)  
KOR-11 USDOC response to exclusion 
request  USDOC response to exclusion request (15  October  2015)  
KOR-13 Hyundai Steel request for 
extension and additional 
guidance  Hyundai Steel request for extension and additional 
guidance (22  October  2015)  
KOR-14 Meeting with counsel to 
Hyundai Steel 
(27 October  2015)  Meeting with counsel to Hyundai Steel (27  October  2015)  
KOR-15 (BCI)  CORE Section  E questionnaire 
response  CORE Section  E questionnaire response 
(2 Novem ber 2015)  
KOR-16  Meeting with counsel to Hyundai Steel  
(27 November  2015)  
KOR-17 (BCI)  Hyundai Steel response to 
supplemental Section  E 
questionnaire  Hyundai Steel response to supplemental Section  E 
questionnaire (10  February  2016)  
KOR-18 (BCI)  CORE first supplemental 
Section  E questionnaire 
response  CORE first supplemental Section  E questionnaire response 
(30 November  2015)  
KOR-19 (BCI)  CORE second supplemental 
Section  E questionnaire 
response  CORE second supplemental  Section  E questionnaire 
response (29  December  2015)  
KOR-20 USDOC letter of cancellation 
of verification  Letter dated 8  March  2018 from the USDOC to Hyundai 
Steel of cancellation of verification  
KOR-21 Hyundai Steel request to 
reconsider the cancellation  of 
verification  Hyundai Steel request to reconsider the cancellation of 
verification (11  March  2016)  
KOR-23 (BCI)  CORE case brief  CORE case brief (22 April 2016)  
KOR-27 CORE final determination  CORE final determination (2  June 2014)  
KOR-28 (BCI)  CRS Section  A questionnaire 
response  CRS Section  A questionnaire response (16  October  2016)  
KOR-29 (BCI)  CRS rebuttal brief  CRS rebuttal brief (13 June  2016)  
KOR-33 CRS initial questionnaire  CRS initial questionnaire (18  September  2015)  
KOR-34 (BCI)  CRS supplemental 
Sections  B-C questionnaire 
response  CRS supplemental Sections  B-C response 
(15 December  2015)  
KOR-35 (BCI)  CRS verification report  Certain cold -rolled steel flat products from the Republic of 
Korea: Hyundai Steel's sales verification report 
(26 May 2016)  
KOR-36 (BCI)  CRS Section  B questionnaire 
response  CRS Section  B questionnaire response (6  November  2015)  
KOR-37 (BCI)  CRS second supplemental 
Sections  B-C questionnaire 
response  CRS second supplemental Sections  B-C quest ionnaire 
response (2  February  2016)  
KOR-41 CRS issues and decision 
memorandum  Memorandum dated 20  July 2016 concerning the final 
affirmative determination in the antidumping duty 
investigation of certain cold -rolled steel products from the 
Republic of Kor ea 
KOR-42 (BCI)  CRS supplemental 
Sections  A-C questionnaire 
response  CRS supplemental Sections  A-C questionnaire response 
(4 January  2016)  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 14 - 
 
  Exhibit  Short Title (if any)  Description  
KOR-43 CRS decision memorandum 
for preliminary 
determination,  Certain Cold -Rolled Steel Flat Products from the Republic 
of Korea: Decision Memorandum for Preliminary 
Determination (29 February 2016)  
KOR-44 CRS preliminary 
determination  Certain cold -rolled steel flat products from the Republic of 
Korea: affirmative preliminary determination of sales at 
less than fair value and postponement of final 
determination, United States Federal Register, Vol.  81, 
No. 44 (7  March  2016), pp. 11757 -11760  
KOR-46 (BCI) CRS HSA sales verification 
report  CRS HSA sales verification report (26 May 2016)  
KOR-47 (BCI)  CRS CEP verification report  CRS CEP verification report (26  May 2016)  
KOR-48 (BCI)  CRS case brief  CRS case brief (6 June  2016)  
KOR-49 (BCI)  CRS final calculation memo  CRS final calculation memo (20 July 2016)  
KOR-51 (BCI)  CRS Section  C questionnaire 
response  CRS Section  C questionnaire response (9  November  2015)  
KOR-53 HRS AD final determination  Certain hot -rolled steel flat products from the Republic of 
Korea: final determination of sales at less than fair value, 
United States Federal Register, Vol. 81, No.  156 
(12 August  2016), pp.  53419 -53421  
KOR-55 (BCI)  HRS Section  A questionnaire 
response  HRS Section  A questionnaire response (2  November  2015)  
KOR-56 (BCI)  HRS Sections  B-C 
questionnaire response  HRS Sections  B-C questionnaire response 
(23 November  2015)  
KOR-57 (BCI)  HRS verification report  HRS Sales verification report (5  July 2016)  
KOR-58 (BCI)  HRS initial questionnaire  HRS initial questionnaire (5  October  2015)  
KOR-59 (BCI)  HRS supplemental 
Sections  A-C questionnaire 
response  HRS supplemental Sections  A-C questionnaire response 
(19 January  2016)  
KOR-65 (BCI)  HRS case brief  HRS case brief (13  July 2016)  
KOR-67 HRS issues and decision 
memorandum  Memorandum dated 4  August  2016 on issues and decision 
for the final affirmative determination in the antidumping 
duty investigation of certain hot -rolled steel flat products 
from the Republic of Korea  
KOR-70 (BCI)  CVD CRS in itial questionnaire 
response  CVD CRS initial questionnaire response (23  October  2015)  
KOR-71 CVD CRS final determination  Countervailing duty investigation of certain cold -rolled 
steel flat products from the Republic of Korea: final 
affirmative determination, United States Federal Register, 
Vol. 81, No.  146 (29 July  2016), pp. 49943 -49946  
KOR-73 (BCI)  CVD CRS affiliated companies 
response  CVD CRS affiliated companies respon se 
(30 September  2015)  
KOR-74 (BCI)  CVD CRS second 
supplemental questionnaire 
response  CVD CRS second supplemental questionnaire response 
(12 November  2015)  
KOR-75 (BCI)  CVD CRS verification report  CVD CRS verification report (29  April 2016)  
KOR-76 (BCI ) POSCO verification exhibit 
PVE-3 POSCO verification exhibit PVE -3 
KOR-77 CVD CRS issues and decision 
memorandum  Memorandum dated 20  July 2016 concerning the final 
determination in the countervailing duty investigation of 
certain cold -rolled steel flat products from the Republic of 
Korea  
KOR-80 19 CFR 351.525  United States Code of Federal Regulations, Title 19, 
Section  351.525  
KOR-83 (BCI)  CVD CRS POSCO and DWI 
case brief  CVD CRS POSCO and DWI case brief (16 May 2016)  
KOR-84 (BCI)  GOK initial que stionnaire  GOK initial questionnaire (30  October  2015)  
KOR-85 CVD CRS supplemental 
questionnaire  CVD CRS supplemental questionnaire (5  November  2015)  
KOR-86 (BCI)  CVD CRS DWI verification 
minor correction  CVD CRS DWI verification minor correction 
(22 March  2016)  
KOR-87 CVD CRS negative preliminary 
determination  Memorandum dated 15  December  2015 concerning the 
preliminary negative determination: countervailing duty 
investigation of certain cold -rolled steel flat products from 
the Republi c of Korea  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 15 - 
 
  Exhibit  Short Title (if any)  Description  
KOR-88 CVD HRS final determination  Countervailing duty investigation of certain hot -rolled 
steel flat products from the Republic of Korea: final  
affirmative determination, United States Federal Register, 
Vol. 81, No. 156 (12 August  2016), pp. 53439 -53441  
KOR-90 (BCI)  CVD HRS initial questionnaire 
response  CVD HRS initial questionnaire response 
(2 November  2015)  
KOR-91 (BCI)  CVD HRS affiliated com panies 
response  CVD HRS affiliated companies response (13  October  2015)  
KOR-92 (BCI)  CVD HRS supplemental 
questionnaire response  CVD HRS supplemental questionnaire response 
(13 April 2016)  
KOR-93 USDOC letter on CVD HRS  USDOC letter dated 14 April 2016 on CVD HRS  
KOR-94 (BCI)  CVD HRS supplemental new 
subsidy allegation 
questionnaire response  CVD HRS supplemental new subsidy allegation 
questionnaire response (3  May 2016)  
KOR-95 Rejection of POSCO's 
resubmission  USDOC letter dated 3  May 2016 rejecting POSCO's 
resubmission  
KOR-96 (BCI)  CVD HRS verification report  CVD HRS verification report (30  June 2016)  
KOR-98 CVD HRS issues and 
decisions memorandum  Memorandum dated 4  August  2016 concerning the final 
determination in the countervailing duty investigation of 
certain hot -rolled steel flat products from the Republic of 
Korea  
KOR-99 CVD HRS POSCO minor 
corrections  CVD HRS POSCO minor corrections (18  May 2016)  
KOR-100 CVD HRS GOK questionnaire 
response  CVD HRS GOK questionnaire response (2  November  2015)  
KOR-101 CVD HRS supplemental 
questionnaire  CVD HRS supplemental questionnaire 
(30 November  2015)  
KOR-102 
(BCI)  CVD HRS supplemental 
questionnaire response  CVD HRS supplemental  questionnaire response 
(4 December  2015)  
KOR-110 LPT POR2 issues and 
decisions memorandum  Memorandum dated 8  March  2016 concerning the final 
results of the administrative review of the antidumping 
duty order on large power transformers from the 
Republic  of Korea, 2013 -2014  
KOR-114 
(BCI)  LPT POR2 HHI comments on 
draft redetermination  LPT POR2 HHI comments on draft redetermination 
(16 January  2018)  
KOR-119 
(BCI)  LPT POR3 HHI third 
supplemental questions 
13 and 17 response  LPT POR3 HHI third supplemental questions 13 and 
17 response (10  November  2016)  
KOR-121 LPT POR3 issues and decision 
memorandum  Memorandum dated 6  March  2017 concerning the final 
results  of the administrative review of the antidumping 
duty order on large power transformers from the 
Republic  of Korea, 2014 -2015  
KOR-122 
(BCI)  LPT POR3 Sections  B-C 
questionnaire response  LPT POR3 Sections  B-C questionnaire response 
(27 January  2016)  
KOR-124 
(BCI)  LPT POR3 supplemental 
Sections  B C questionnaire  LPT POR3 supplemental Sections  B-C questionnaire 
(27 July 2016)  
KOR-125 
(BCI)  First part of LPT POR3 
supplemental Sections  A-D 
questionnaire response  First part of LPT POR3 supplemental Sections  A-D 
questionnaire response (10  August  2016)  
KOR-126 
(BCI)  Second part of LPT POR3 
supplemental Sections  A-D 
questionnaire response  Second part of LPT POR3 supplemental Sections  A-D 
questionnaire response (18  August  2016)  
KOR-127 
(BCI)  LPT POR3 decision 
memorandum for preliminary 
results  Decision memorandum dated 26  August  2016 concerning 
the preliminary results of antidumping duty 
administrative  review: large power transformers from the 
Republic of Korea, 2014 -2015  
KOR-128 
(BCI)  LPT POR3 HHI t hird 
supplemental questionnaire  LPT POR3 HHI third supplemental questionnaire 
(7 October  2016)  
KOR-129 
(BCI)  LPT POR3 petitioner's case 
brief LPT POR3 petitioner's case brief (2  December  2016)  
KOR-130 
(BCI)  LPT POR3 HHI case brief  LPT POR3 Hyundai case brief (5  January  2017)  
KOR-131 LPT POR3 petitioner's 
comments on questionnaires 
to be issued  LPT POR3 petitioner's comments on questionnaires to be 
issued (12  November  2015)  
KOR-132 LPT POR3 HHI response to 
petitioner's comments  LPT POR3 HHI response to petitioner's comments 
(20 November  2015)  
KOR-134 
(BCI)  LPT POR3 Section  D 
questionnaire response  LPT POR3 Section  D questionnaire response 
(5 February  2016)  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 16 - 
 
  Exhibit  Short Title (if any)  Description  
KOR-135 
(public 
version)  LPT POR3 decision 
memorandum for preliminary 
results  Memorandum dated 26  August  2016 concerning the 
preliminary results of antidumping duty 
administrative  review: large power transformers from the 
Republic of Korea, 2014 -2015  
KOR-136 
(BCI)  LPT POR3 HHI supplemental 
questionnaire response  LPT POR3 HHI suppl emental questionnaire response 
(27 October  2016)  
KOR-137 LPT POR3 petitioner call 
memorandum  Memorandum dated 16  December  2016 on LPT POR3 
petitioner call  
KOR-140 LPT POR4 decision 
memorandum (PDM)  Memorandum dated 31  August  2017 concerning the 
preliminary results of antidumping duty 
administrative  review: large power transformers from the 
Republic of Korea, 2015 -2016 
KOR-141 
(BCI)  LPT POR4 HHI post 
preliminary comments  LPT POR4 HHI post preliminary comments 
(5 October  2017)  
KOR-144 
(BCI)  LPT P OR4 Sections  B-D 
questionnaire response  LPT POR4 Sections  B-D questionnaire response 
(27 February  2017)  
KOR-145 LPT issues and decision 
memorandum  Memorandum dated 2 July 2012 concerning the final 
determination of the antidumping duty investigation of 
large power transformers from the Republic of Korea  
KOR-146 
(BCI)  LPT POR4 request for 
clarification  LPT POR4 request for clarification (29  March  2017)  
KOR-147 
(BCI)  LPT POR4 second 
supplemental questionnaire  LPT POR4 second supplemental questionnaire 
(19 May 2017)  
KOR-148 
(BCI)  LPT POR4 second 
supplemental questionnaire 
response  LPT POR4 second supplemental questionnaire response 
(16 June 2017)  
KOR-149 
(BCI)  LPT POR4 HHI case brief  LPT POR4 HHI case brief (1 2 October  2017)  
KOR-150 
(BCI)  LPT POR4 Section  A 
questionnaire response  LPT POR4 Section  A questionnaire response 
(2 February  2017)  
KOR-151 LPT POR4 USDOC Moses Y. 
Song memorandum  Memorandum dated 4  October  2017 requesting to reject 
and remove file  
KOR-152 
(BCI)  LPT POR4 Hyosung Section  A 
questionnaire response  LPT POR4 Hyosung Section  A questionnaire response 
(2 February  2017)  
KOR-153 
(BCI)  LPT POR4 Hyosung 
Sections  B-D questionnaire 
response  LPT POR4 Hyosung Sections  B-D questionnaire response 
(27 February  2017)  
KOR-154 
(BCI)  LPT POR4 Hyosung 
supplemental Section  A 
questionnaire response  LPT POR4 Hyosung supplemental Section  A questionnaire 
response (8  May 2017)  
KOR-155 LPT POR4 Hyosung third 
supplemental questionnaire   LPT POR4 Hyosung third supplemental questionnaire 
(26 May 2017)  
KOR-156 
(BCI)  LPT POR4 Hyosung third 
supplemental questionnaire 
response  LPT POR4 Hyosung third supplemental questionnaire 
response (21  June 2017)  
KOR-157 
(BCI)  LPT POR4 Hyosung case brief  LPT POR4 Hyosung case brief (13  October  2017)  
KOR-158 
(BCI)  LPT POR4 petitioner 
pre-preliminary comments  LPT POR4 petitioner pre -preliminary comments 
(18 July 2017)  
KOR-159 
(BCI)  LPT POR4 Hyosung response 
to comments by petitioner  LPT POR4 Hyosung response t o comments by petitioner 
(11 August  2017)  
KOR-160 Alloy steel final determination  Memorandum dated 29 March 2017 concerning the final 
affirmative determination in the less -than-fair-value 
investigation of certain carbon and alloy steel 
cut-to-length plate from France  
KOR-163 Heavy welded steel final 
determination  Memorandum dated 14  July 2016 concerning the final 
affirmative determination in the less -than-fair-value 
investigation of heavy walled rectangular welded carbon 
steel pipes and tubes from th e Republic of Turkey  
KOR-175 Essar Steel Ltd. v. 
United  States  United States Court of Appeals for the Federal Circuit, 
Essar Steel Ltd. v. United States (12 June 2014)  
KOR-176 De Cecco Di Filippo Fara. S. 
Martino v. United  States  United States Court of Appeals for the Federal Circuit, F.Lii 
de Cecco di Filippo Fara. S. Martino v. United  States, 
(16 June 2000)  
KOR-177 Özdemir Boru San. ve Tic. 
Ltd. Sti. v. United  States  United States Court of International Trade, Özdemir Boru 
San. ve Tic. Ltd. Sti. v. United  States, Court No. 16 -00206 
(16 October  2017)  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 17 - 
 
  Exhibit  Short Title (if any)  Description  
KOR-178 Lifestyle Enterprise, Inc. v 
United  States  United States Court of International Trade, Lifestyle 
Enterprise v. United  States, Consol. Court No. 09 -00378 
(11 February 2011)  
KOR-206 
(BCI)  LPT POR2 court remand  United States Court of International Trade, ABB, INC. v. 
United States, Consol. Court No. 16 -00054, 
Slip Op. 17-138 (10  October  2017)  
KOR-207 
(public 
version)  LPT POR2 draft results of 
redeterminatio n USDOC, Draft results of redetermination pursuant to court 
remand, Consol. Court No. 16 -00054, Slip Op. 17 -138 
(10 October  2017)  
KOR-207 
(revised , 
public version ) LPT POR2 final results of 
redetermination  USDOC, Final results  of redetermination pursuant to court 
remand, Consol. Court No. 16 -00054, Slip Op. 17 -138 
(10 October  2017) 
KOR-209 LPT POR3 initial questionnaire  LPT POR3 initial questionnaire (3  December  2015)  
KOR-211 LPT POR4 issues and decision 
memorandum  Memorandum dated 9  March  2018 concerning the final 
results of the administrative review of the 
antidumping  duty order on large power transformers from 
the Republic of Korea, 2015 -2016  
KOR-212 LPT POR4 HHI request for 
meeting  LPT POR4 HHI request for meet ing (10  July 2017)  
KOR-213 
(BCI)  LPT POR4 second 
supplemental questionnaire 
response  LPT POR4 second supplemental questionnaire response 
(19 June 2017)  
KOR-215 LPT POR4 second 
supplemental questionnaire 
response  LPT POR4 second supplemental  questionnaire response 
(26 June 2017)  
KOR-216 
(revised)  List of AFA proceedings  List of all proceedings in which AFA was used since the 
amendments of Section  502 of the TPEA  
KOR-217 Analysis of USDOC cases  Substantive analysis of 12 representative USDOC  cases  
KOR-226 USDOC Anti -Dumping Manual  Excerpt of USDOC Anti -Dumping Manual  
KOR-227 
(BCI)  CRS final redetermination  CRS final redetermination (16  October  2018)  
KOR-245 Section  776 of the Tariff Act  Section  776 of the Tariff Act, as amended by Section  502 
of the 2015 TPEA, codified in 19 U.S.C. 1677e  
KOR-248 
(BCI)  LPT POR2 supplemental 
Sections B -C questionnaire 
response  LPT POR2 supplemental Sections B -C questionnaire 
response (3  June 2015)  
KOR-252 
(BCI)  LPT POR3 petitioner's 
comments  LPT POR3 petitioner's comments (2  December  2016)  
KOR-269 
(BCI)  LPT POR3 petitioner case 
brief LPT POR3 petitioner case brief (5  January  2017)  
KOR-270 
(BCI)  LPT POR3 HHI rebuttal brief  LPT POR3 HHI rebuttal brief (11  January  2017)  
USA-3 CORE initial question naire 
extension  CORE initial questionnaire extension (11  September  2015)  
USA-4 USDOC additional guidance  USDOC additional guidance (16  September  2015)  
USA-5 (BCI)  CORE first supplemental 
Section  E questionnaire  CORE first supplemental  Section  E questionnaire 
(19 November  2015)  
USA-8 CORE issues and decision 
memorandum on PDM  Memorandum dated 21  December  2015 concerning the 
preliminary determination in the antidumping duty 
investigation of certain corrosion -resistant steel products 
from the Republic of Korea  
USA-14 (BCI)  CRS part I of Section  D 
questionnaire response  Cold-rolled steel products from Korea: Hyundai Steel 
Section  D questionnaire response (Part I) 
(4 November  2015)  
USA-15 (BCI)  CRS supplemental 
Sections  B-C questionnaire  CRS supplemental Sections  B-C questionnaire 
(19 January  2016)  
USA-20 (BCI)  HRS supplemental 
Sections  A-C questionnaire  HRS Supplemental Sections  A-C questionnaire 
(23 December  2015)  
USA-23 LPT POR2 initial questionnaire  LPT POR2 initial questionnaire (1  December  2014)  
USA-24 (BCI)  LPT POR2 Sections  B-C 
questionnaire response  LPT POR2 Sections  B and C questionnaire response, 
(26 January  2015)  
USA-27 (BCI)  LPT POR2 draft results of 
redetermination  USDOC, ABB INC. v. United States, final r esults of 
redetermination pursuant to court remand, Consol. Court 
No. 16 -00054, Slip Op. 17 -138 (10  October  2017)  
USA-29 (BCI)  LPT POR2 final results of 
redetermination  USDOC, ABB INC. v. United States, final results  of 
redetermination pursuant to court remand, Consol. Court 
No. 16 -00054, Slip Op. 17 -138 (10  October  2017)  
USA-35 LPT POR4 initial questionnaire  LPT POR4 initial questionnaire (5  January  2017)  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 18 - 
 
  Exhibit  Short Title (if any)  Description  
USA-36 (BCI)  LPT POR4 first supplemental 
sales questionnaire  LPT POR4 first supplemental sales questionnaire 
(12 April 2017)  
USA-37 (BCI)  LPT POR4 first supplemental 
sales questionnaire response  LPT POR4 first supplemental sales questionnaire response 
(3 May 2017)  
USA-39 (BCI)  LPT POR4 supplemental 
questionnaire  LPT POR4 supplemental questionnaire (11  July 2017)  
USA-40 LPT POR4 meeting 
memorandum  Memorandum dated 21  July 2017 concerning 2015/2016 
administrative review of the antidumping duty order on  
large power transformers from the Republic of Korea: 
meeting wi th Counsel for HHI  
USA-41 (BCI)  LPT POR4 supplemental 
questionnaire response  LPT POR4 supplemental questionnaire response 
(24 July 2017)  
USA-43 (BCI)  LPT POR4 preliminary 
analysis memorandum  Memorandum dated 31  August  2017 concerning the 
preliminary results of the 2015 -2016 administrative 
review of the antidumping duty order on large power 
transformers from the Republic of Korea  
USA-46 (BCI)  Hyosung initial anti -dumping 
questionnaire  Hyosung initial anti -dumping questionnaire 
(5 January  2017) 
USA-61 Viet I -Mei Frozen Foods Co. 
v. United  States  United States Court of International Trade, Viet I -Mei 
Frozen Foods Co. v. United States, Court No. 14 -00092 
(30 July 2015)  
USA-62 Stainless steel bar from Italy, 
issues and decision 
memorandum  Memorandum dated 23  January  2002 concerning the final 
determination in the countervailing duty investigation of 
stainless steel bar from Italy  
USA-72 (BCI)  CRS supplemental 
Sections  B-C questionnaire  CRS supplemental Sections  B-C questionnaire 
(24 November  2015)  
USA-90 Welded line pipe from Korea, 
issues and decision 
memorandum  Memorandum dated 5  October  2015 concerning the final 
negative determination: countervailing duty investigation 
of welded line pipe from the Republic of Korea  
USA-91 Non-oriented electrical steel 
from Chinese Taipei, issues 
and decision memorandum  Memorandum dated 6  October  2014 concerning the final 
affirmative countervailing duty determination in the 
countervailing duty investigation of non -oriented electrical 
steel f rom Chinese Taipei  
USA-96   List of duplicative cases in KOR -216 
 WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  ABBREVIATIONS USED IN THIS REPORT  
Abbreviation  Description  
[[***]] [[***]] 
AD anti-dumping  
AFA adverse facts available  
Anti-Dumping Agreement  Agreement on Implementation of Article  VI of the General Agreement on Tariffs 
and Trade 1994  
AHSS  advanced high -strength steel  
AUL average useful life  
BCI Business Confidential Information  
CEP constructed export price  
CONNUM  control number  
CORE  corrosion -resistant steel  
CRS cold-rolled steel  
CVD countervailing duty  
DSB Dispute Settlement Body  
DSU Understanding on Rules and Procedures Governing the Settlement of Disputes  
DWI Daewoo International Corporation  
E&C enforcement and compliance  
FEZ free economic zone  
GATT 1994  General Agreement on Tariffs and Trade 1994  
GOK Government of Korea  
HHI Hyundai Heavy Industries  
HRS hot-rolled steel  
HSA Hyundai Steel America  
Hyosung  Hyosung Corporation  
Hyundai Steel  Hyundai Steel Corporation  
Iljin Electric  Iljin Electric Co., Ltd.  
KEXIM  Korea Export Import Bank  
KNOC  Korea National Oil Corporation  
KORES  Korean Resources Corporation  
LPT  large power transformer  
LSIS LSIS Co., Ltd.  
NME non-market economy  
OAF order of acknowledgement form  
PDM preliminary decision memorandum  
POI period of investigation  
POR2  period of review from 1 August 2013 to 31  July 2014  (second administrative 
review)  
POR3  period of review from 1 August 2014 to 31 July 2015  (third administrative 
review)  
POR4  period of review from 1 August 2015 to 31 July 2016  (fourth administrative 
review)  
R&D research and development  
SCM Agreement  Agreement on Subsidies and Countervailing Measures  
SEQHs  home market sales sequence number s 
SEQUs  US sales sequence numbers  
SSB skelp, sheet, and blank  
2015 TPEA Amendment  Section 502 of the Trade Preferences Extension Act of 2015  
TWB tailor-welded blank  
UHSS  ultra-high-strength steel  
USCIT  US Court of International Trade  
USDOC  United States Department of Commerce  
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/DS539/ R 
BCI deleted, as indicated [[***]]  
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  1  INTRODUCTION  
1.1  Complaint by Korea  
On 14 February 2018 , the Republic of Korea ( Korea ) 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  XXII:1 of the General  Agreement  on Tar iffs and 
Trade  1994 (GATT 1994), Articles  17.2 and 17.3 of the  Agreement  on Implementation of Article  VI 
of the GATT  1994 (Anti -Dumping  Agreement ), and Article  30 of the  Agreement  on Subsidies and 
Countervailing Measures (SCM  Agreement)  with respect to the measures and claims set out below.1 
Consultations were held on 22 March 2018, but were unsuccessful in resolving the  dispute  
between the parties . 
1.2  Panel establishment and composi tion 
On 16 April 2018 , Korea  requested the establishment of a panel pursuant to Article  6 of the 
DSU with standard terms of reference.2 Pursuant to Kore a's request, the Dispute Settlement Body 
(DSB) established the Panel at its meeting on 28 May 2018,  in accordance with Article  6 of the DSU.3 
Under its terms of reference, the Panel is required : 
To examine, in the light of the relevant provisions of the covered  Agreement s cited by 
the parties to the dispute, the matter re ferred to the DSB by the Republic of Korea  in 
document WT/DS 539/6  and to make such findings as will assist the DSB in making the 
recommendations or in giving the rulings provided for in those  Agreement s.4 
Based on an  Agreement  between  the parties, the Panel was composed on 5 December 2018 as 
follows : 
Chairperson:  Ms Ma rta Calmon Lemme  
 
Members:   Ms Leora Blumberg  
   Mr Matthew Kennedy  
 
Brazil, Canada, China, Egypt, the European Union, India, Japan, Kazakhstan, Mexico, Norway, 
and the Russian Federation  notified their interest in participating in the Panel proceedings as  
third parties.   
1.3  Panel proceedings  
1.3.1   General  
Having consulted with the parties, t he Panel adopted its Working Procedures5 together with the 
timetable  for the se proceedings  on 13 February 2019 . The timetable was further revised during the 
course of the panel  proceeding s in light of subsequent developments  and upon the parties ' requests .6 
The Panel held  its first substantive meeting with the parties on 24 and 25 July 2019 . A session 
with the third parties  was convened  on 25 July 2019 . The Panel's second substantive meeting with 
the parties  was held  on 11 and 12 February 2020 . The Panel issued its Interim Report to the parties 
on 24 September 2020 , followed by the Final Report to the parties on 17  December 2020 . 
 
1 Request for consultations by Korea, WT/DS539/1 (Korea's  consultations request).  
2 Request for the establishment of a panel by Korea, WT/DS539/6 (Korea's  panel request).  
3 DSB, Minutes of meeting held on 28 May 2018, WT/DSB/M/413.  
4 Constitution note of the Panel, WT/DS539/7.  
5 Working Procedures in Annex  A-1. 
6 The timetable was update d and revised on 29 July 2019, 4 September 2019, 26  February 2020, 
28 February 2020, and 3 September 2020.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  1.3.2   Working Procedures on Business Confidential Information  
Based on its consultations with the parties , on 13 February 2019  the Panel  adopted additional 
Working Procedures for the protection of Business Confidential Information ( BCI).7 
1.3.3   Preliminary ruling  request  
On 23 April 2019, before filing its first written submission, the United  States  requested a 
preliminary ruling that one of the claims advanced by  Korea – i.e. its "as such" claim against an 
alleged unwritten measure – was outside the  Panel's terms of referenc e.8 Korea responded to the 
United  States'  request on 21 May 2019.9 Both parties requested the  Panel to issue its preliminary 
ruling at the earliest moment practicable.10 Following the Pane l's invitation to all third parties to 
comment on the United  States'  request, two third parties addressed th is issue in their third -party 
submissions .11  
The Panel issued its preliminary ruling  to the parties , with the third parties on copy , on 
2 July 2019, before its first substantive meeting  with the parties .12 Declining the 
United  States'  request, t he Panel found  that, for purposes of Article  6.2 of the DSU, the alleged 
unwritten measure that is the object of Korea 's "as such" challenge is properly identified in its panel 
request . The Panel 's preliminary ruling and its underlying reasons are presented together in 
section  7.4.1 of this Report . 
2  FACTUAL ASPECTS  
2.1  The measures at issue  
Korea's panel request challenges the WTO -consistency of several  measures concerning the 
imposition by the United  States  of anti -dumping and countervailing duties on imports of products 
from Korea . 
First, Korea challenges  on an "as applied" basis the  definitive anti -dumping  (AD) and 
countervailing duty (CVD) measures imposed by the United  States  pursuant to the preliminary and 
final determinations and orders issued by the United  States  Department of Commerce (USDOC ) in 
the following investigations and administrative reviews13: 
a. Anti-Dumping Duties on Certain Corrosion -Resistant Steel Products  (CORE)  from the 
Republic of Korea (USDOC investigation number A -580-878) ("CORE AD Investi gation ") as 
set forth, among others, in:  
i. Final Determination of Sales at Less Than Fair Value and Final Affirmative 
Determination of Critical Circumstances, United  States  Federal Register, Vol.  81, 
No. 35303 (2 June 2016);  
 
7 Additional Working Procedures on Business Confidential Information in Annex  A-2. 
8 United  States'  request for a preliminary ruling.  
9 Korea's  response to United  States'  preliminary ruling request.  
10 United  States'  request for a preliminary ruling, para.  24; Korea's  response to 
United  States'  preliminary ruling request, para.  54. 
11 Canada's  third-party submission, paras.  26-35; European Union's  third-party submission, 
paras.  70-71. 
12 The Panel's  preliminary ruling is reproduced in full in Annex  A-4. 
13 Korea's  panel request, para.  6. The panel request explains that the "measures include the conduct of 
those investigations and administrativ e reviews, any preliminary or final anti -dumping and countervailing duty 
determinations issued in those investigations and administrative reviews, any definitive anti -dumping and 
countervailing duties imposed as a result of those investigations and adminis trative reviews, as well as any 
notices, annexes, decision memoranda, orders, amendments, or other instruments issued by the United  States 
in connection with these anti -dumping and countervailing duty measures". (Ibid. para. 6). The panel request 
"also con cerns any modification, review, replacement or amendment to the definitive anti -dumping and 
countervailing duty measures listed above and any closely connected, subsequent measures to determine a 
dumping margin or subsidy amount, or related anti -dumping du ty or countervailing duty rates". (Ibid. para.  7). WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  ii. Issues and Decision Memorandum for the Final Affirmative Determination in the 
Anti-Dumping  Duty Investigation of Certain Corrosion -Resistant Steel Products from 
the Republic of Korea (24 May 2016);  and 
iii. Anti-Dumping  Duty Order, United  States  Federal Register, Vol.  81, No.  48390 
(25 July 2016).  
b. Anti-Dumping Duties on Certain Cold -Rolled Steel Flat Products from the Republic of Korea 
(USDOC investigation number A -580-881) ("CRS AD Investigation ") as set forth, among 
others, in:  
i. Final Determination of Sales at Less Than Fair Value , United  States  Federal Register, 
Vol. 81, No.  49953 (29 July 2016);  
ii. Issues and Decision Memorandum for the Final Affirmative Determination in the 
Anti-Dumping Duty Investigation of Certain Cold -Rolled Steel Products from the 
Republic of Korea (20 July 201 6); and 
iii. Anti-Dumping  Duty Order, United  States  Federal Register, Vol.  81, No.  64432 
(20 September 2016).  
c. Countervailing Duties on Certain Cold -Rolled Steel Flat Products from the Republic of Korea 
(USDOC investigation number C -580-882) ("CRS CVD Investigation ") as set forth, among 
others, in:  
i. Final Affirmative Determination, United  States  Federal Register, Vol.  81, No.  49943 
(29 July 2016);  
ii. Issues and Decision Memorandum for the Final Determination in the Countervailing 
Duty Investigation of Certa in Cold -Rolled Steel Flat Products from the Republic of 
Korea (20 July 2016);  and 
iii. Countervailing Duty Order, United  States  Federal Register, Vol.  81, No.  64436 
(20 September 2016).  
d. Anti-Dumping Duties on Certain Hot -Rolled Steel Flat Products from the Repu blic of Korea 
(USDOC investigation number A -580-883) ("HRS AD Investigation ") as set forth, among 
others, in:  
i. Final Determination of Sales at Less Than Fair Value, United  States  Federal Register, 
Vol. 81, No.  53419 (12 August 2016);  
ii. Issues and Decision Memorandum for the Final Affirmative Determination in the 
Anti-Dumping  Duty Investigation of Certain Hot -Rolled Steel Flat Products from the 
Republic of Korea (4 August 2016);  and 
iii. Anti-Dumping  Duty Order, United  States  Federal Register, Vol.  81, No.  67962 
(3 October 2016).  
e. Countervailing Duties on Certain Hot -Rolled Steel Flat Products from the Republic of Korea 
(USDOC investigation number C -580-884) ("HRS CVD Investigation ") as set forth, among 
others, in:  
i. Final Affirm ative Determination, United  States  Federal Register, Vol.  81, No.  53439 
(12 August 2016);  
ii. Issues and Decision Memorandum for the Final Determination in the Countervailing 
Duty Investigation of Certain Hot -Rolled Steel Flat Products from the Republic of Kor ea 
(4 August 2016);  and WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  iii. Countervailing Duty Order, United  States  Federal Register, Vol.  81, No.  67960 
(3 October 2016).  
f. Anti-Dumping Duties on Large Power Transformers from the Republic of Korea (USDOC 
investigation number A -580-867) ("LPT AD Investigation ") as set forth, among others, in:  
i. Final Determination of Sales at Less Than Fair Value, United  States  Federal Register, 
Vol. 77, No.  40857 (11 July 2012);  
ii. Anti-Dumping  Duty Order, United  States  Federal Register, Vol.  77, No.  53177 
(31 August 2012);  and 
iii. Review determinations and related measures, including:  
• Final Results of Redetermination Pursuant to Court Remand, ABB INC. 
v. United  States , Consol. Court No. 16 -00054, Slip O p 17-138 (7 February 2018 , 
remand of second administrative review ); 
• Final Results of Anti -Dumping  Duty Administrative Review; 2014 -2015 
(United  States  Federal Register, Vol . 82, No.  13432 (13 March 2017 ), third 
administrative review) ; 
▪ Issues and Decision Memorandum for the Final Results of the Administrative 
Review of the Anti -Dumping  Duty Order on Large Power Transformers from 
the Republic of Korea; 2014 -2015 (6 March 2017) ; 
• Final Results of Anti -Dumping  Duty Administrative Review; 2015 -2016 
(United  States  Federal Register, Vol.  83, No.  11679 (16 March 2018 ), fourth 
administrati ve review) ; 
▪ Issues and Decision Memorandum for the Final Results of the Administrative 
Review of the Anti -Dumping  Duty Order on Large Power Transformers from 
the Republic of Korea; 2015 -2016 (9 March 2018) ; and 
• Final Results of the Expedited First Sunset Review of the Anti -Dumping  Duty Order, 
United  States  Federal Register, Vol.  82, No. 51604 (7 November 2017) ;  
▪ Issues and Decision Memorandum for the Expedited First Sunset Review of 
the Anti -Dumping  Duty Order on Large Power Transformers from the 
Republic of Korea (31 October 2017).  
Second, Korea challenge s "as such" the following  provisions of the domestic law of the  
United  States  relating to the USDO C's use of facts available and  the drawing of adverse inferences14: 
a. Section 502 of the Trade Preferences Extension Act of 2015, Pub. L. No. 114 -27; 
b. Section 776 of the Tariff Act of 1930, codified at the United  States  Code of Federal 
Regulations, Title 19, Section  1677e;  
c. the implementing regulations of the USDOC in the United  States  Code of Federal 
Regulations, Title 19, Section  351, including in parti cular Section 308; and  
d. any other related, subsequent measures that enable or implement the use of facts 
available in anti -dumping and countervailing duty investigations, administrative reviews , 
and other parts of such proceedings.  
 
14 Korea's  panel request, para.  8. See also fn  19 below.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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Finally, Korea  challenges  "as such" an unwritten measure allegedly adopted by the 
United  States  (the "alleged unwritten measure" ) as follows:  
C. Use of Adverse Facts Available As Ongoing Conduct, or a Rule or Norm of 
General and Prospective Application  
This request also concerns t he ongoing conduct or the practice of the USDOC of using 
"adverse facts available" as a rule or norm of general and prospective application when 
a producer or exporter is found to have failed to cooperate by not acting to the best of 
its ability. Under thi s ongoing conduct or norm, whenever the USDOC makes a finding 
that a producer or exporter has failed to cooperate by not acting to the best of its ability, 
it adopts adverse inferences and, in determining the duty rate for this producer or 
exporter, select s facts from the record that are adverse to the interests of this producer 
or exporter without establishing (i ) that such inferences can reasonably be drawn in 
light of the degree of cooperation received, and (ii ) that such facts are the "best 
information available" in the particular circumstances. [1]15 
1 The use of adverse facts available has been consistently applied by the USDOC and is 
undertaken pursuant to : (i) Section 502 of the Trade Preferences Extension Act of 2015, Pub. L. 
No. 114 -27; (ii ) Section 776 of the Tariff Act of 1930, codified at 19 U.S .C. § 1677e; and (iii ) the 
implementing regulations of the USDOC in 19 C.F.R. § 351, including in particular section  308. 
It is also evidenced, for example, by the manner in which facts available was used in the 
measures identified in Section I.A of this R equest. A preliminary and non -exhaustive list of 
measures confirming the existence of this ongoing conduct or rule or norm of applying adverse 
facts available whenever a finding is made that a producer or exporter has failed to act to the best 
of its abili ty is attached as Annex  I to illustrate the practice . 
 
3  PARTIES ' REQUESTS FOR FINDINGS AND RECOMMENDATIONS  
Korea  requests the Panel to make the following findings16: 
a. In relation to each of the anti -dumping and countervailing duty measures identified under 
the "as applied " claims, the United  States  acted inconsistently with Article  6.8 and 
Annex  II of the Anti -Dumping  Agreement , in particular paragraphs 1, 3, 5, 6, and 7 of 
Annex  II, and Article  12.7 of the SCM  Agreement  relating to the lack of basis to resort to 
facts available, the improper application of facts available, and the drawing of adverse 
inferences in the selection of facts otherwise available.  
b. In addition, as a consequence of the undue use of adverse facts a vailable  (AFA) when 
determining dumping or subsidization, the "as applied " anti-dumping measures are also 
inconsistent with Articles  1, 9.3, and 18.1 of the Anti -Dumping  Agreement , and the "as 
applied " countervailing duty measures are inconsistent with Articles 10, 19.4 , and 32.1 of 
the SCM  Agreement . 
c. Moreover, the "all others " rate applied by the USDOC in the fourth administrative review 
of the anti -dumping duties on LPTs from Korea is inconsistent with Article  9.4 of the 
Anti-Dumping  Agreement , as the USD OC failed to disregard the margins established based 
on facts available pursuant to Article  6.8 of the Anti -Dumping  Agreement . 
d. In relation to the "as such " claims, the United  States  acted inconsistently with Article  6.8 
and Annex  II of the Anti -Dumping  Agreement , in particular paragraphs 1, 3, 5, 6, and 7 
of Annex  II, and Article  12.7 of the SCM  Agreement  by reason of the AFA rule or norm or 
AFA ongoing conduct since these measures involve selecting the facts available on the sole 
basis of the ad verse inference and without engaging in the required comparative process 
of reasoning and evaluation in search of an accurate determination.   
 
15 Korea's  panel request, para.  9 and fn  1. 
16 Korea's  first written submission, para.  1040;  second written submission, para.  434. See also 
Korea's  first written submission, paras.  455 and 657.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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Korea  further requests  that, pursuant to Article  19.1 of the DSU, the Panel recommend that 
the United  States  bring its measures into conformity with its WTO obligations.   
The United  States  requests that the Panel reject Korea's claims in this dispute in their entirety.  
4  ARGUMENTS OF THE PARTIES  
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 Pan el (see Annexes B -1 
and B -2). 
5  ARGUMENTS OF THE THI RD PARTIES  
The arguments of Brazil, Canada, the European Union, Japan, Mexico,  and Norway  are reflected 
in their executive summaries, provided in accordance with paragraph  26 of the Working Procedures 
adopted by the Panel (see Annexes C -1, C-2, C-3, C-4, C-5, and C -6). China, Egypt, India, 
Kazakhstan, and the Russian Federation did not make written or oral submissions before  the Panel.  
6  INTERIM REVIEW  
The Panel issued its  Interim Report to the parties  on 24 September 2020 . On 12 October 2020, 
Korea and the United State s each submitted written requests seeking a review of precise aspects of 
the Interim Report. On 26 October 2020, both parties submitted comments on each other's requests 
for review. Neither party requested an interim review meeting.  
The requests made at th e interim review stage as well as the Pane l's discussion and disposition 
thereof  are set out in Annex  A-4. 
7  FINDINGS  
This dispute concerns several "as applied" claims and one "as such" claim by Korea alleging a 
violation of the United  States'  obligations under the Anti -Dumping and SCM  Agreement s. On an "as 
applied" basis,  Korea challenges  individual instances of the USDOC 's use of facts available in 
four anti-dumping17 and two countervailing duty18 investigations  with respect to  the 
United  States'  obligations under the covered  agreements . In each of the six investigations at issue, 
Korea claims  both that the conditions for  the USDOC 's resort  to facts available were not met and 
that the USDOC 's subsequent selection  of the replacement facts  for the missing information  was in 
violation of the applicable legal disciplines.  In addition to its "as applied"  challenges , Korea also 
advances an "as such" claim against an alleged unwritten measure concerning the USDOC 's use of 
"adver se facts available ".19 Korea 's "as such" challenge does not take issue with the USDOC 's resort  
to facts available, but, instead, focuses exclusively on the USDOC 's "selection  of the facts available 
in a situation where a finding of non -cooperation has been made".20 
Our findings and conclusions are organized as follows. We begin by addressing  certain  issues 
of general  relevance  (section  7.1), including the applicable rules of treaty interpretation , the burden 
of proof , and the standard (s) of review. Subsequently, we  consider  certain interpretative issues that  
are common  to our analysis of  several of Korea's "as applied" challenges as well as its "as such"  
claim  (section  7.2). We then evaluate Kore a's claims, beginning with its "as applied" c hallenges  
against  individual instances of  the USDO C's use of facts available in each of the six investigations at 
issue (section  7.3) and then turning to its "as such" c laim against an alleged unwritten measure  
(section  7.4). Our conclusions  and recommendation  are set out in section  8 of this Report.   
 
17 CORE AD Investigation (USDOC investigation number A -580-878); CRS AD Investigation (USDOC 
investigation number A -580-881); HRS AD Investigation (USDOC investigation number A -580-883); and 
LPT AD Investigation (USDOC investigation number A -580-867).  
18 CRS CVD Investigation (USDOC investigation number C -580-882); and HRS CVD Investigation 
(USDOC investigation number C -580-884). 
19 Korea did not pursue its "as such" claim against certain US domestic law provisions identified in 
paragraph  2.3 of this Panel Report. (Korea's  comments on draft  descriptive part, para.  1). 
20 Korea's  response to Panel question No.  43. (emphasis added)  WT/DS539/ R 
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  7.1  General issues  
7.1.1   Treaty interpretation  
In Article  3.2 of the  DSU, WTO Members "recognize" that the WTO dispute settlement system  
serves , inter alia , to "clarify" the "existing provisions" of the covered agreement s "in accordance 
with customary rules of interpretation of public international law".  Article  17.6(ii ) of the 
Anti-Dumping  Agreement  also stipulates that the panel s "shall interpret the relevant provisions of 
[that]  Agreement  in accordance with customary rules of interpretation of public international law ".  
The "customary rules of interpretation of public i nternational law" within the meaning of the 
DSU and the Anti -Dumping  Agreement  are the rules of interpretation that have attained the status 
of general customary international law,  as codified , in particular, in Articles  31 and 32 of the 
Vienna  Convention on the Law of Treaties (Vienna Convention) .21  
Article  31(1) of the Vienna Convention , as rendered applicable  by Article  3.2 of the DSU , 
requires that the covered agreement s are to be interpreted  "in good faith in accordance with the 
ordinary me aning to be given to the terms of the treaty in their context and in light of its object and 
purpose".  The "ordinary meaning"  of treaty terms can be ascertained only in their context and in 
light of the object and purpose of the treaty.22 Moreover, the pri nciple of effectiveness in treaty 
interpretation, which is a corollary of the general rule in Article  31, requires that a treaty interpreter 
must give meaning and effect to each term and not render redundant whole clauses or paragraphs.23 
The rules of trea ty interpretation "neither require nor condone the imputation into a treaty of words 
that are not there or the importation into a treaty of concepts that were not intended".24 Instead, 
"[t]he fundamental rule of treaty interpretation requires a treaty interpreter to read and interpret 
the words actually used by the  Agreement  under examination, and not words which the interpreter 
may feel should have been used".25 As reflected i n the use of the singular "rule" in the title of 
Article  31, "interpretation pursuant to the customary rule codified in Article  31 of the 
Vienna  Convention  is ultimately a holistic exercise that should not be mechanically subdivided into 
rigid components".26 
Pursuant to Article  32 of the Vienna Convention , a treaty interpreter may resort to 
supplementary means of interpretation either to "confirm" the meaning resulting from the 
application of Article  31 of the Vienna  Convention, or to determine the meaning when the 
interpretation according to Article  31 le aves the meaning "ambiguous or obscure" or leads to a 
"manifestly absurd" or "unreasonable" result. Supplementary means of interpretation include  "the 
preparatory work of the treaty and the circumstances of its conclusion".27 
7.1.2   Burden of proof  
The DSU does n ot contain any  rules concerning burden of proo f. However,  the 
"generally  accepted canon of evidence in … most jurisdictions, that the burden of proof rests upon 
the party … who asserts the affirmative of a particular claim or defence"  is also followed in the 
WTO dispute settlement system .28 In WTO dispute settlement  proceedings , it is understood that a 
complainant must "establish a prima facie  case of inconsistency with [the] provision [invoked] before 
the burden of showing consistency with that provision is taken on by the defending party".29 A "prima 
facie case is one which, in the absence of effective refutation by the defending party, requi res a 
panel, as a matter of law, to rule in favour of the complaining party presenting the prima facie  
case".30 
 
21 Appellate  Body Reports, US – Gasoline , DSR 1996:I, pp.  15-16; Japan – Alcoholic Beverages II , 
DSR 1996:I, p.  104.  
22 Appellate  Body Report, China – Publications an d Audiovisual Products , para.  348. 
23 See, e.g. Appellate  Body Report, US – Gasoline , DSR 1996:I, p.  21. See also Appellate  Body Report, 
Korea – Dairy , para.  81. 
24 Appellate  Body Report, India – Patents (US) , para.  45. 
25 Appellate  Body Report, EC – Hormones , para.  181. 
26 Appellate  Body Report, China – Publications and Audiovisual Products , para.  348. 
27 See also Appellate  Body Report, EC – Chicken Cuts , para.  283.  
28 Appellate  Body Report, US – Wool Shirts and Blouses , DSR  1997:I, p.  335. 
29 Appellate  Body Report, EC – Hormones , para.  104. 
30 Appellate  Body Report, EC – Hormones , para.  104. WT/DS539/ R 
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  7.1.3   Standard(s ) of review  
The standard of review is the criteria  by which  a panel examines  the consistency of a challenged 
measure with a WTO Membe r's obligations under the WTO  covered agreement s. In the present 
dispute, Korea  brings claims under the SCM  Agreement  and the Anti -Dumping  Agreement .  
The SCM  Agreement  does not contain any special or additional rules on the standard of review 
to be adopted by the Panel.31 Panels examining claims under the SCM  Agreement  are guided by the 
general function of panels as set out in Article  11 of the DSU , which provides , in relevant part , that : 
[A] panel 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  Agreement s[.] 
A panel 's function under Article 11 to make an "objective assessment" embraces both factual 
and legal aspects of a panel 's examination of the "matter" .32 We also  note the clarification in  
Article  3.2 of the DSU that "[r]ecommendations  and rulings of the DSB cannot add to or diminish 
the rights and obligations provided in the covered  Agreement s". 
Article  17.6 of the Anti -Dumping  Agreement  sets out a "special" standard of review for claims 
under that  Agreement  and reads as follows:  
In examining the matter referred to in paragraph  5: 
(i) in its assessment of the facts of the matter, the panel shall determine whether 
the authorities ' establishment of the facts was proper and whether their 
evaluation of those facts was unbiased and objective . If the establishment of the 
facts was proper and the evaluation was unbiased and objective, even though the 
panel might have reached a different conclusion, the evaluation shall not be 
overturned;  
(ii)  the panel shall interpret the relevant provisions o f the Agreement  in accordance 
with customary rules of interpretation of public international law. Where the panel 
finds that a relevant provision of the  Agreement  admits of more than one 
permissible interpretation, the panel shall find the authorities ' measure to be in 
conformity with the  Agreement  if it rests upon one of those permissible 
interpretations.33 
The first sub paragraph  of Article  17.6 concerns the pane l's "assessment  of the facts of the 
matter", while the second guides its interpretative exercise.34 Under Article  17.6(i), a panel is tasked 
with determining, first, whether the investigating authorities ' "establishment  of the facts was proper " 
and, second, whether their " evaluation  of those facts was unbiased  and objective ". Article  17.6(ii), 
like Article  3.2 of the DSU, makes clear that the provisions of the Anti -Dumping  Agreement  are to 
be interpreted in accordance with the "customary rules of interpretation of public international  law". 
If, however, such an interpretative exercise "admits of more than one permissible interpretation", 
panels are precluded from reaching a finding of WTO -inconsistency if the challenged measure "rests 
upon one of those permissible interpretations ".35  
Although  the text of Article  17.6(i) is couched in terms  of an obligation upon WTO panels,  we 
consider that  "the provision, at the same time, in effect  defines when investigating authorities can 
be considered to have acted inconsistently with the Anti -Dumping  Agreement  in the course of their 
'establishment ' and 'evaluation ' of the relevant facts" .36 Only if an investigating 
authorit y's "establishment of the facts" is "proper" and its "evaluation of those facts" is "unbiased 
 
31 Appellate  Body Report, US – Lead and Bismuth II , para.  45. 
32 Appellate  Body Report, US – Hot-Rolled Steel , para.  54. 
33 Emphasis added. Article  17.6 of the Anti -Dumping  Agreement is identified in Article  1.2 and 
Appendix  2 of the DSU as one of the "special or additional rules and procedures" which prevail over the DSU 
"[t]o the extent that there is a difference" between th ose provisions and the provisions of the DSU.  
34 Appellate  Body Report, US – Hot-Rolled Steel , para.  54. (emphasis original)  
35 Appellate  Body Report, US – Hot-Rolled Steel , paras.  59-60. (emphasis added)  
36 Appellate  Body Report, US – Hot-Rolled Steel , para . 56. (emphasis added)  WT/DS539/ R 
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  and objective" can it successfully withstand the scrutiny of a WTO  panel  under Article  17.6(i). These 
requirements are applicable  to all aspects  of an investigating authorit y's conduc t and to  all stages 
of an investigation . 
While different provisions may apply to the examination of claims under the 
Anti-Dumping  Agreement  and the SCM  Agreement37, we note that  both agreements envisage a 
review of  measures in the form of  agency action, i.e . determinations made by the competent 
authorities of WTO Members .38 In terms of the degree of deference to be accorded in reviewing 
agency determinations , our tasks under the two covered agreement s are, therefore,  not entirely 
dissimilar.  
When  reviewing the WTO -consistency of agency determinations , WTO panels are  precluded  
from engaging in a de novo  review of the evidence as well as from substituting their own conclusions 
for those of the competent autho rities.39 Panels must  therefore  limit their review to the competent 
authorities ' determination, focusing , in particular , on the explanation provided  by the competent 
authorities in their published report.40  
The obligation upon panels to make an "objective  assessment" of the "matter" and to not 
engage in  a de novo review has an important corollary. F or purposes of review of their 
WTO-consistency , competent authorities must support their determinations with explanations  
establish ing that they have discharged  the specific  obligation s imposed by the provision s of the 
covered agreement s that are alleged to be infringed . The "objective assessment" to be made by a 
panel reviewing an investigating authorit y's determination is thus enabled and informed by the 
explanation provided by an authority.   
Whether the explanation  provided by a competent authority  is sufficiently "reasoned and 
adequate"  for purposes of establishing compliance with the relevant WTO obligations  will depend 
inevitably  upon the specific facts and circumstances of a given case.41 Importantly, t he exact 
standard of review to be applied by a panel in examining agency determinat ions is a "function of the 
substantive provisions of the specific covered  Agreement s that are at issue in the dispute"42 as well 
as the "specific claim(s ) put forth by a complainant"  in a given case .43 
Although panels must not conduct a de novo  review , they must not simply defer to the 
conclusions of the competent authority  either .44 Instead, a pane l's examination of a competent 
authorit y's conclusions must be "critical and searching", and  ought to  be "based on the information 
contained in the record and the explanations given by the authority in its published report".45 Though 
ultimately d epend ent upon the precise claim that is advanced  as well as the specific  treaty provision 
at issue , the Appella te Body has identified several "general lines of inquiry" that may be relevant to  
a panel's task.46 Specifically, with respect to the "duties that apply to panels in their review of the  
factual components  of the findings made by investigating authorities" – as is the case with many of 
 
37 We do not address the issue of "whether there may ever be circumstances in which separate 
consideration of a single injury determination would be required in the light of the standards of review under 
the Anti -Dumping  Agreement and  the SCM  Agreement" as this is not the case before us. (Appellate  Body 
Report, US – Softwood Lumber VI (Article  21.5 – Canada) , para.  92). 
38 Appellate  Body Reports, US – Countervailing Duty Investigation on DRAMs , para.  184; 
US – Hot-Rolled Steel , para.  55. 
39 Appellate  Body Report, US – Lamb , para.  106. In the context of the Anti -Dumping  Agreement, see 
Appellate  Body Report, Thailand – H-Beams , para.  117 ("[t]he aim of Article  17.6(i)  is to prevent a panel from 
'second -guessing ' a determination of a nationa l authority when the establishment of the facts is proper and the 
evaluation of those facts is unbiased and objective" (emphasis added)). See also Appellate  Body Report, 
Russia  – Commercial Vehicles , para.  5.102.  
40 Appellate  Body Report, US – Lamb , para.  105. 
41 Appellate  Body Report, US – Softwood Lumber VI (Article  21.5 – Canada) , para.  93. 
42 Appellate  Body Report, US – Softwood Lumber VI  (Article  21.5 – Canada) , para.  95 (referring to 
Appellate  Body Report, US – Countervailing Duty Investigation on DRAMS , para. 184). See also Appellate  Body 
Reports, US – Countervailing Measures (China) , para.  4.182; and EC – Hormones , para. 115.  
43 Appellate  Body Report, US – Countervailing Measures (China) , para.  4.182.  
44 See also Appellate  Body Report, US – Softwood Lumbe r VI (Article  21.5 – Canada) , para.  93. 
45 Appellate  Body Report, US – Softwood Lumber VI (Article  21.5 – Canada) , para.  93. 
46 Appellate  Body Report, US – Softwood Lumber VI (Article  21.5 – Canada) , para. 93 (referring to 
Appellate  Body Report, US – Lamb , para.  106).  WT/DS539/ R 
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  the claims in this dispute  – we agree with  the Appellate  Body's general observations in US – 
Softwood Lumber VI ( Article  21.5 – Canada ) that: 
[I]t is in the nature of anti -dumping and countervailing duty investigations that an 
investigating authority will gather a variety of information and data from different 
sources, and that these may suggest different trends and outcomes. The investigating 
authority will inevitably be ca lled upon to reconcile this divergent information and data. 
However, the evidentiary path that led to the inferences and overall conclusions of the 
investigating authority must be clearly discernible in the reasoning and explanations 
found in its report . When those inferences and conclusions are challenged, it is the task 
of a panel to assess whether the explanations provided by the authority are "reasoned 
and adequate" by testing the relationship between the evidence on which the authority 
relied in drawin g specific inferences, and the coherence of its reasoning . In particular, 
the panel must also examine whether the investigating authorit y's reasoning takes 
sufficient account of conflicting evidence and responds to competing plausible 
explanations of that evidence. This task may also require a panel to consider whether, 
in analyzing the record before it, the investigating authority evaluated all of the relevant 
evidence in an objective and unbiased manner , so as to reach its findings " without 
favouring the interests of any interested party, or group of interested parties , in the 
investigation."47 
7.2  Interpretative framework  
Korea 's claims in this dispute  raise a number of interpretative issues under the covered 
agreement s relating to an investigating authorit y's use of facts available in anti -dumping and 
countervailing duty investigations. The following  section  focuses on certain interpretative 
considerations relating to  an investigating authorit y's selection  of the  replacement facts – a recurrent 
issue that bears upon  our analysis of several of  Korea's "as applied" challenges as well as its "as 
such"  claim . Subsequently, as part of our examination of Kore a's claims, we set out our 
interpretation of the provisions conditioning the  resort  to facts available, and further develop  our 
analysis regarding the selection  of the replacement facts , as regards  each claim.   
Korea argues that, in the context of the selection of the  replacement facts , a "basic 
principle[]"48 under both the Anti -Dumping  Agreement  and the SCM  Agreement  is that "an 
investigating authority must undertake a comparative evaluation to ensure that it is using the 'best 
information ' available; i.e. the most fitting or 'most appropriate ' information av ailable in the case at 
hand" .49 According to Korea, the panel and Appellate  Body in Mexico – Anti-Dumping Measures on 
Rice agreed "that investigating authorities must, in accordance with Article  6.8 and Annex  II of the 
Anti-Dumping  Agreement , carry out a c omparative evaluation of the evidence available in order to 
determine which constitutes the 'best information'" .50 As part of all of its claims  under Article 6.8 
and Annex II of the Anti -Dumping Agreement and Article 12.7 of the SCM Agreement , Korea thus 
alleges that, in selecting the replacement facts, the USDOC does not engage in the "requisite 
comparative analysis" to select the "best information available".51 Moreover, in the context of its "as 
such" claim, Korea  uses the term  "best information available " as part of identifying the alleged 
unwritten measure and also  in presenting the  legal basis of its complaint.52  
The United  States  responds  that "neither Article  6.8 nor Annex  II of the 
Anti-Dumping  Agreement  contains the term 'compa rative evaluation'" .53 Referring to the 
 
47 Appellate  Body Report, US – Softwood Lumber VI (Article  21.5 – Canada) , para. 97 (quoting 
Appellate  Body Report, US – Hot-Rolled Steel , para.  193). (emphasis added)  
48 Korea's  first written submission, para.  63. 
49 Korea's  first written s ubmission, para.  71. 
50 Korea's  first written submission, para.  71 (quoting Appellate  Body Report, Mexico – Anti-Dumping 
Measures on Rice , para.  289, in turn referring to Panel Report, Mexico – Anti-Dumping Measures on Rice , 
para. 7.166).  
51 See, e.g. Korea's  first written submission, paras.  88, 126, 201, and 859; response to Panel question 
No. 49, para.  4 ("[s]uch an 'inevitable'  exercise of selecting the 'best information available'  must necessarily 
entail a process of (comparative)  assessm ent and evaluation among the facts that are available to the 
authority"). See also Korea's  first written submission, paras. 323, 337, 443, and 853;  and second written 
submission, paras. 264 and 367.  
52 Korea's  panel request, paras.  9 and 32 -34. 
53 United  States' first written submission, para.  34. WT/DS539/ R 
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  Appellate  Body Report in US – Carbon Steel (India) , the United  States  submits that neither the 
Anti-Dumping  Agreement , nor the SCM  Agreement , imposes an obligation upon investigating 
authorities to engage in a "comparative evaluation" in all circumstances.54 The United  States  also 
considers "erroneous" Kore a's "repeated[] invo[cation of] the title 'best information available ' as if 
it is a separate legal obligation or legal standard by which USDO C's determinations should be 
assessed" .55 
Given the parties ' disagreement  on the obligations that apply to investigating 
authorit ies' selection of the replacement facts , we begin by setting out our interpretation  – in 
accordance with the customary rules of interpretation of public international law  – of the relevant 
provisions under  the Anti -Dumping  Agreement  and the SCM  Agreement  that bear upon investigating 
authorit ies' selection of replacement fact s. We then address whether and to what extent the covered 
agreement s require investigating authorities to select the "best information available" in order to 
arrive at an "accurate" determination and to engage in a "comparative evaluation".  
7.2.1   Anti-Dumping  Agreement  
In accordance with Article  31 of the Vienna Convention, our  task is to ascertain the ordinary 
meaning of the terms of Article  6.8 of the Anti -Dumping  Agreement  in their context and in light of 
their object and purpose . Article  6 of the Anti -Dumping  Agreement  is entitled "Evidence" and sets 
out the "evidentiary rul es that apply throughout the course of an anti -dumping investigation, and 
provide [s] also for due process rights that are enjoyed by 'interested parties ' throughout such an 
investigation".56 Article  6.8 provides  that: 
In cases in which any interested party  refuses access to, or otherwise does not provide, 
necessary information within a reasonable period or significantly impedes the 
investigation, preliminary and final determinations, affirmative or negative, may be 
made on the basis of the facts available. The provisions of Annex  II shall be observed 
in the application of this paragraph.  
The first sentence of Article  6.8 allows  investigating authorit ies – through the use of the 
permissive "may" – to overcome a lack of information in  the responses of interested parties, by 
using "facts" that are otherwise "available" to the authorities as the basis for completing their 
determinations.57 The provision thus addresses the "dilemma" for investigating authorities when 
faced with a gap in the r esponses of interested parties .58 By allowing the filling of such gaps, 
Article  6.8 helps ensure that  investigating authorities do not cede  all control of the investigation to 
the interested parties.59  
At the same time, the first sentence of Article  6.8 also imposes  important limitations upon  
investigating authorities ' use of the "facts" that are otherwise "available" in order to overcome a lack 
of information and complete their determination s.60 The first sentence limits  investigating 
authorit ies' recourse  to facts available  only to situations  where an "interested party " (a) "refuses 
access to, or otherwise does not provide,  necessary information within a reasonable period of time "; 
or (b) "significantly impedes the investigation".61 In both situation s, investigating authorit ies are 
required to complete their determination s on the basis of  "facts" that are "available"  to them.62 
The second sentence of Article  6.8 and Annex  II to the Anti -Dumping  Agreement  impose 
further limitations upon investigating authorities ' use of "facts" that are otherwise "available".  The 
second sentence mandates compliance with the provisions of Annex  II – entitled " Best inf ormation 
available in terms of paragraph  8 of Article  6" – in the application of Article  6.8.63 The reference to 
 
54 United  States'  first written submission, paras.  34-35 (quoting Appellate  Body Report, US – Carbon 
Steel (India) , paras.  4.434 -4.435).  
55 United  States'  opening statement at the first meeting of the Panel, para.  47; opening statement at 
the second meeting of the Panel, para.  54; and response to Panel question No.  49, para.  10.  
56 Appellate  Body Report, EC – Bed Linen (Article  21.5 – India) , para.  136. 
57 Appellate  Body Report, US – Hot-Rolled Steel , para.  77. 
58 Panel  Report, Egypt – Steel Rebar , para.  7.146.  
59 See, e.g. Appellate  Body Report, US – Hot-Rolled Steel , paras.  73 and 86.  
60 Panel Report, US – Shrimp (Viet Nam) , para.  7.233.  
61 Panel Report, Egypt – Steel Rebar , para.  7.146.  
62 Panel Report, China – GOES , para . 7.296.  
63 Panel Reports, US – Steel Plate , para.  7.56; Egypt – Steel Rebar , para.  7.152.  WT/DS539/ R 
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  "this paragraph" in the second sentence of Article  6.8 indicates that "Annex  II applies to Article  6.8 
in its entirety, and thus contains certain substantive parameters for the application of the individual 
elements of that article" .64 Moreover, the term "shall be observed" indicates that "these parameters, 
which address both when facts available can be used, and what information can be used as facts 
available, must be followed" by investigating authorities.65 Thus, d espite the repeated use of the 
term "should " in Annex  II, its provisions are mandatory because of  the use of the term  "shall" in the 
second sentence of Article  6.8. For this reason, investigating authorities acting inconsistently with  
the "additional preconditions"66 and "operational requirements"67 set out in the relevant provisions 
of Annex  II will also be found to be in breach of Article  6.8.  
In this manner, Article  6.8 and Annex  II to the Anti -Dumping  Agreement  together reflect  a 
carefully constructed and  fine balance  struck by the drafters  between, on the one hand, the interests 
of investigating authorities in controlling and completing their investigations and, on the other hand, 
the due process  and participatory  rights of interested parties.68 
A question that arises in several claims in t his dispute is what replacement facts  may form 
the basis for investigating authorities ' determinations.  We note that Article  6.8 contemplates the use 
of facts available only to replace the missing information that is "necessary" for purposes of the 
specific determination that is to be made .69 By its terms, Article  6.8 is "not directed at mitigating 
the absence of 'any ' or 'unnecessa ry' information, but is rather concerned with overcoming the 
absence of information required to complete a determination".70 This suggests that "the process of 
identifying the 'facts available ' should be limited to identifying replacements for the 'necessa ry 
information ' that is missing from the record".71 In this sense,  "there has to be a connection between 
the 'necessary information ' that is missing and the particular 'facts available ' on which a 
determination … is based".72 In our view, t he text of Article  6.8 requires investigating authorities to 
base their determinations on those "facts" that are  "available " and  that "reasonably replace" the 
missing "necessary" information.73 The requirement that investigating authorities must select 
reasonable replacements for the missing "necessary " information implies that such selection cannot 
be aimed at punishing a non -cooperating party.  
That said, given  that an investigating authority may lack full and complete knowledge of the 
missing "necessary" information when resorting to the use of facts available under Article  6.874, the 
search for such "reasonable replacements" must be conducted in light of the specific facts and 
circumstances of each instance in which an investigating authority use s facts available.75 
Importantly, a panel 's review of an investigating authority 's selection of the replacement facts 
should be conducted in light of the information that was actually available to the in vestigating 
authority during the course of the investigation. Whether an investigating authority selected  
reasonable replacement s for the missing information is, therefore, not to be determined  in the 
 
64 Panel Report, Egypt – Steel Rebar , para.  7.152.  
65 Panel Report, Egypt – Steel Rebar , para.  7.152.  
66 Panel Report, China – GOES , para.  7.385.  
67 Panel Report, US – Steel Plate , para.  7.56. 
68 See, e.g. Appellate  Body Report, US – Hot-Rolled Steel , para.  102. See also Appellate Body Report, 
US – Oil Country Tubular Goods Sunset Reviews , para. 241 . 
69 See also, in the context of the similarly worded A rticle 12.7 of the SCM  Agreement, Appellate  Body 
Report, US – Countervailing Measures (China) , para.  4.178 (quoting Appellate  Body Report, US – Carbon Steel 
(India) , para.  4.416, in turn quoting Appellate  Body Report, Mexico – Anti-Dumping Measures on Rice , 
para. 293), noting that that Article  12.7 "permits the use of facts on record solely for the purpose of replacing 
information that may be missing".  
70 Appellate  Body Report, US – Carbon Steel (India) , para.  4.416. See also Panel Report, EC – Salmon 
(Norwa y), para. 7.343.  
71 Appellate  Body Report, US – Carbon Steel (India) , para.  4.416. (emphasis added)  
72 Appellate  Body Report, US – Carbon Steel (India) , para.  4.416.  
73 Appellate  Body Report, Mexico – Anti-Dumping Measures on Rice , para.  294. 
74 See, e.g. Appe llate Body Report, US – Carbon Steel (India) , para.  4.426 (referring to "the selection of 
a replacement for an unknown fact " (emphasis added)); Panel Report, US – Carbon Steel (India) , fn 734 
(noting that "[i]n the case of non -cooperation by an interested party … the investigating authority will not 
know the actual missing relevant information".)  
75 Appellate  Body Report, US – Carbon Steel (India) , para.  4.421.  WT/DS539/ R 
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  abstract, e.g.  by reference to "necessary" information that may subsequently be revealed or 
discovered outside the context of an investigation.76 
Furthermore, we note that Annex  II to the Anti -Dumping  Agreement  is entitled "Best 
information available in terms of paragraph 8 of Article  6". By its own terms, the title does not create 
an independent obligation.77 As discussed in greater detail below, w e consider that the title of 
Annex  II usefully highlights that t he object and purpose of the disciplines in Article  6.8 and Annex  II, 
as a whole , is to ensure that the conduct of investigating authorities aim s to select "best information 
available" in order to fill the evidentiary void resulting from the missing "neces sary" information.78 
This supports our interpretation above that Article  6.8 requires investigating authorities to select 
those facts that reasonably replace in the specific facts and circumstances  surrounding  each instance 
of missing "necessary" informati on. 
Turning to  the context provided by  Annex  II, we note that the first and second sentences of 
paragraph  7 require that, in circumstances where investigating authorities "have to base their 
findings" on information from a "secondary source" they must exercise "special circumspection" and, 
where practicable, check such information from other independent sources at their disposal.79 This 
indicates that investigating authorities are required to exercise their judgment in selecting facts 
available.80 In ou r view, the tasks of exercising "special circumspection" and checking the 
information81 provide contextual support for the view that the process of selecting the "facts 
available" under Article  6.8 is aimed at identifying reasonable replacements for the mi ssing 
information , and not at punishing a non -cooperating party .82 
Article  17.6(i ) of the Anti -Dumping  Agreement  also provides relevant context for the 
interpretation of Article  6.8. Article  17.6(i ) requires that, "in its assessment of the facts of the 
matter, the panel shall determine whether the authorities ' establishment of the facts was proper and 
whether their evaluation of those facts was unbiased and objective" . As we have explained83, 
although Article  17.6(i ) speaks, in the first instance, to the  task of WTO  panels, "the provision, at 
the same time, in effect  defines when investigating authorities can be considered to have acted 
inconsistently with the Anti -Dumping  Agreement  in the course of their 'establishment ' and 
'evaluation ' of the relevant f acts".84 Thus, Article  17.6(i ) requires that an investigating 
authority 's "establishment of the facts" be "proper" and that its "evaluation of those facts" be 
"unbiased and objective". We note, in this regard, that Article  6.8 is also directed at an invest igating 
authority 's "establishment" and "evaluation" of "facts", albeit those that are otherwise "available" in 
the absence of the "necessary" information. By requiring that an investigating 
authorit y's establishment of the facts is "proper" and its  evalua tion of the facts that are available is 
"unbiased and objective"85, Article  17.6(i ) thus supports the view that the authorit y must select 
reasonable  replacements for the missing information, and not  be aimed  at punishing the 
non-cooperating party.  
We also consider relevant as context paragraph  3 of Annex  II, the first sentence of which 
requires that:  
 
76 We note the Appellate Body's  observation that "[t]here is no doubt that a Member may not seek to  
defend its agency's  decision on the basis of evidence not contained in the record of the investigation". 
(Appellate  Body Report, US – Countervailing Duty Investigation on DRAMs , para.  161).  
77 See paras. 7.43-7.44 below.  
78 Korea's  response to Panel question No.  49, para.  5. 
79 Both Korea and the United  States agree that it is not necessary for the Panel to comprehensively 
define what constitutes "a secondary source" for purposes of this dispute. (Korea's  comments on the 
United States'  response to Panel question No.  52, p.  13; United  States'  response to Panel question No.  52, 
para. 13). 
80 Panel Report, Korea – Certain Paper (Article  21.5 – Indonesia) , para.  6.26. 
81 Panel Reports, Korea – Certain Paper (Article  21.5 – Indonesia ), para.  6.27; Egypt – Steel Rebar , 
para. 7.154.  
82 Appellate  Body Reports, US – Anti-Dumping Methodologies (China) , para.  5.173; US – Carbon Steel 
(India) , para.  4.416.  
83 See para. 7.13 above.  
84 Appellate  Body Report, US – Hot-Rolled Steel , para.  56. (original emphasis omitted; emphasis added)  
85 This requires an investigating authority to reach its findings "without favouring the interests of any 
intere sted party, or group of interested parties" in the investigation. (Appellate  Body Report, US – Softwood 
Lumber VI (Article  21.5 – Canada) , para. 97 (quoting Appellate  Body Report, US – Hot-Rolled Steel , 
para. 193)).  WT/DS539/ R 
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  All information which is verifiable, which is appropriately submitted so that it can be 
used in the investigation without undue dif ficulties, which is supplied in a timely fashion, 
and, where applicable, which is supplied in a medium or computer language requested 
by the authorities, should be taken into account when determinations are made .86  
The ordinary meaning of paragraph  3 requ ires investigating authorities to take into account all 
information that fulfils certain criteria "when determinations are made". We agree  with prior panels 
and the Appellate  Body that paragraph  3 serves as a touchstone for examining whether an 
investigati ng authority properly rejected information submitted by an interested party as a 
precondition for  resorting to the use of facts available .87 However , we note that the scope of the 
first sentence is textually not limited to that issue . Rather, it applies "when determinations are 
made ", which includes the time at which replacement facts  are selected to form the basis of a 
determination.88 Further, the first sentence speaks of "all information", without limiting that to 
information submitt ed or supplied by a particular interested party, such as the  allegedly  
non-cooperating exporter.89 Thus, besides conditioning an investigating authority 's resort  to facts 
available,  paragraph  3 of Annex  II, in our view,  also provides useful context for an investigating 
authority 's selection of the replacement facts  under Article  6.8.90  
In particular , paragraph  3 of Annex  II provides useful context for the requirement under 
Article  6.8 that determinations be made on the basis of "facts" that are "available" to an investigating 
authority. The provision supports the interpretation that, in selecting the replacement "facts" for the 
missing "necessary " information, an investigating autho rity is required to take into account all facts 
that are properly available to it.91  
Finally, we note that the last sentence of paragraph  7 of Annex  II makes it "clear … that if an 
interested party does not cooperate and thus relevant information is being  withheld from the 
authorities, this situation could lead to a result which is less favourable to the party than if the party 
did cooperate" . This indicates that a "less favourable " result is not necessarily WTO-inconsistent  and 
that an investigating autho rity is not always  required to select th ose replacement facts that are  
"most favourable " to a non -cooperating party. Rather, "non-cooperation creates a situation in which 
a less favourable result becomes possible due to the selection of a replacement for an unknown 
fact".92 We consider that paragraph  7 provides contextual support for the understanding that the 
"procedural circumstances in which information is missing" – including the interested party 's own 
conduct and its awareness of the c onsequences of not providing the "necessary" information93 – 
may be relevant to an investigating authority 's selection of replacement facts under Article  6.8.94 At 
the same time , nothing in the text of paragraph  7 suggests  that procedural circumstances entitle 
investigating authorit ies to dispense with the  requirement to  select reasonable replacements for  the 
missing " necessary " information .  
 
86 Emphasis added.  
87 See, e.g. Panel Repo rts, China – Broiler Products (Article  21.5 – US), para.  7.342;  Mexico – Steel 
Pipes and Tubes , para.  7.164; EC – Salmon (Norway) , paras.  7.346 and 7.355; US – Steel Plate , para.  7.55; 
and Egypt – Steel Rebar , para.  7.159; and Appellate  Body Report, US – Hot-Rolled Steel , paras.  80-81. For a 
fuller discussion of how paragraph 3 of Annex II disciplines an investigating authority's  rejection of information 
submitted by interested parties, see para. 7.138  below.  
88 The second sentence of paragraph  3 addresses the issue of when "the failure to respond in the 
preferred medium or computer language should not be considered to significantly impede the investigation", 
but it does not limit the temporal scope of the requir ement in the first sentence to take all information into 
account "when determinations are made".  
89 In this regard, we note that paragraph  7 of Annex  II refers to "information from a secondary source".  
90 The panel in Mexico – Anti-Dumping Measures on Rice also discussed paragraph  3 of Annex  II in the 
context of an investigating authority's  selection of replacement facts. (Panel Report, Mexico – Anti-Dumping 
Measures on Rice , para.  7.166).  
91 Appellate  Body Report, US – Anti-Dumping Methodologies (China) , para . 5.172 (referring to 
Appellate  Body Reports, Mexico – Anti-Dumping Measures on Rice , para.  294; and US – Carbon Steel (India) , 
para. 4.419).  
92 Appellate  Body Report, US – Carbon Steel (India) , para.  4.426.  
93 As noted by the Appellate  Body, paragraph  1 of Annex  II to the Anti -Dumping  Agreement, which 
serves as relevant context for the interpretation of Article  6.8, "makes a connection between the 'awareness'  of 
an interested party, and the ability for an investigating authority to have recourse to the 'fac ts available'". 
(Appellate  Body Report, US – Carbon Steel (India) , para.  4.426).  
94 Appellate  Body Report, US – Carbon Steel (India) , para.  4.426.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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In sum, we consider that  the terms of Article  6.8, interpreted in light of th eir context and 
object and purpose , require investigating authorities  to select  – in an unbiased and objective 
manner  – those facts available that constitute reasonable replacements for the missing "necessary" 
information  in the specific facts and circumstances  of a given case.  In doing so,  investigating 
authorities must take into account  all facts that are properly available to them. In selecting the 
replacement facts, Article  6.8 does not require investigating authorities to select those facts that are 
most "f avourable" to the non -cooperating party. I nvestigating authorities may take into account the 
procedural circumstances in which information is missing , but Article  6.8 does not condone the 
selection of replacement facts for the purpose of punishing interested part ies. 
7.2.2   SCM Agreement  
Having addressed Article  6.8 of the Anti -Dumping  Agreement , we turn to Article  12.7 of the 
SCM Agreement , which states that:  
In cases in which any interested Memb er or interested party refuses access to, or 
otherwise does not provide, necessary information within a reasonable period or 
significantly impedes the investigation, preliminary and final determinations, affirmative 
or negative, may be made on the basis of  the facts available.  
Article  12.7 of the SCM  Agreement  shares many textual similarities with the first sentence of 
Article  6.8 of the Anti -Dumping  Agreement , but we note that the term "interested Member or" do es 
not appear in the latter provision .95 These provisions share a common aim, namely, "permit [ting] 
an investigating authority, under certain circumstances, to fill in gaps in the information necessary 
to arrive at a conclusion as to subsidization (or dumping ) and injury".96 Article  12.7 allows recourse 
to facts available in similar  situations to those contemplated in Article  6.8 of the 
Anti-Dumping  Agreement . Moreover, both provisions form part of the disciplines on the identification 
and collection of evidence and use the term "facts available" t o denote replacements for the missing 
"necessary" information.97 Our interpretative analysis of the text of the first sentence of Article  6.8 
of the Anti -Dumping  Agreement , therefore , remains  equally relevant to our interpretation of 
Article  12.7 of the SC M Agreement . For reasons explained above, Article  12.7 requires investigating 
authorities to select reasonable replacements for the missing "necessary " information.  
We note that, unlike the Anti -Dumping  Agreement , the SCM  Agreement  does not set out in 
an annex the precise parameters that are applicable to an investigating authorit y's use of facts 
available.98 We agree with the Appellate  Body that "[t]his does not mean, however, that no such 
conditions exist in the SCM  Agreement ".99 Several provisions of the SCM  Agreement  provide 
additional  context for interpreti ng Article  12.7. Article  12.1 supports the understanding that 
investigating authorities  are required  to take into account all facts  that are properly available to 
them in sele cting reasonable replacements for the missing information under Article  12.7.100 The 
context provided by Articles  12.4 and 12.11 "suggest[s] that the manner or procedural 
circumstances in which information is missing can be relevant to an investigating auth ority's use of 
'facts available ' under Article  12.7".101  
While we remain mindful of the absence in the SCM  Agreement  of an equivalent of Annex  II 
to the Anti -Dumping  Agreement , we agree with the Appellate  Body that "it would be anomalous if 
Article  12.7 of the SCM  Agreement  were to permit the use of 'facts available ' in countervailing duty 
investigations in a manner markedly different from that in anti -dumping investigations" .102 
 
95 See also, paras. 7.269 -7.270  below.  
96 Appellate  Body Report, Mexico – Anti-Dumping Measures on Rice , para.  291. 
97 Appellate  Body Report, Mexico – Anti-Dumping Measures on Rice , paras.  291-292 (quoting 
Appellate  Body Report, EC – Tube or Pipe Fittings , para.  138, in turn quoting Appellate  Body Report, EC – Bed 
Linen (Article  21.5 – India) , para.  136).  
98 Appellate  Body Report, Mexico – Anti-Dumping Measure s on Rice , para.  291. 
99 Appellate  Body Report, Mexico – Anti-Dumping Measures on Rice , para.  291. 
100 Appellate  Body Report, Mexico – Anti-Dumping Measures on Rice , paras.  292 and 294. See also 
Appellate  Body Report, US – Carbon Steel (India) , para.  4.417.  
101 Appellate  Body Report, US – Carbon Steel (India) , para.  4.422.  
102 Appellate  Body Report, Mexico – Anti-Dumping Measures on Rice , para.  295. See also Appellate  Body 
Report, US – Carbon Steel (India) , para.  4.423.  WT/DS539/ R 
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  Depending upon the interpretativ e issue at hand103, therefore,  Annex  II to  the 
Anti-Dumping  Agreement  may also provide  relevant context for the interpretation of Article  12.7 of 
the SCM  Agreement .104 We consider our observations regarding the contextual relevance of the 
provisions of Annex  II to the Anti -Dumping  Agreement  for interpreting Article  6.8 thereof remain 
also relevant for purposes of interpreting Article  12.7 of the SCM  Agreement .  
Thus, like Article  6.8 of the Anti -Dumping  Agreement , Article  12.7 of the SCM  Agreement  
requires investigating authorities to select those facts available that constitute reasonable 
replacements for the missing "necessary" information  in the specific facts and circumstances of a 
given case . In selecting reasonable replacements , investigating  authorities must take into account 
all facts that are properly available to them. While investigating authorities may take into account 
the procedural circumstances in which information is missing  in their selection of the replacement 
facts, Article  12.7 does not allow such selection for the purpose of punishing the non -cooperating 
party.  
7.2.3   "Best information available" and "comparative evaluation"  
Korea argues that an investigating authority is under an obligation "to ensure the information 
used for facts av ailable is the best information available that reasonably replaces the alleged missing 
information to arrive at an accurate determination".105 According to Korea,  "the investigating 
authorit y's obligation to select the 'best information available ' is firmly grounded in the express text 
of Annex  II, as well as the context and purpose of Article  6.8 of the Anti -Dumping  Agreement , as 
clearly confirmed by well -established WTO jurisprudence" .106 Korea clarifies "that the concept of 
'best' information is not the same as 'the most favourable ' information", but relates to  the 
"reliability" and "relevance" of the replacement information with a view to  "identifying the 'second 
best' information when t he 'first best ' information is not available" .107 The United  States , for its part, 
maintains that " the title of Annex  II does not provide a separate legal obligation or legal standard" 
by which investigating authorities ' determinations should be assessed. Rather, for the United  States , 
"the substantive obligations in Annex  II are set out in the provisions contained in paragraphs  1 
through  7".108  
We consider that the title of Annex  II usefully highlights that the object and  purpose  of the 
disciplines in Article  6.8 and Annex  II, as a whole,  is to ensure that investigating authorities ' conduct 
is aimed at selecting "best information available" in order to fill the evidentiary void resulting from 
the missing "necessary" inform ation.109 That said, we note that, despite using these terms in the 
title of the Annex  II, the drafters did not use them in Article  6.8, nor in paragraphs 1 to 7 of Annex  II 
or anywhere else in the Anti -Dumping  Agreement . They provided no definition of what constitutes 
"best information available" in the abstract.  
We consider these choices to be important  because the drafters ' ends must be distinguished 
from their chosen means.110 What constitutes the "best information av ailable" can only be 
determined in the specific facts and circumstances of a given case. The "first -best" or most 
"accurate" information is, under all circumstances, the information that is "necessary".111 In the 
absence of a reference point provided by actual knowledge of such information – as may be the case 
when an interested party refuses access to, or otherwise does not provide, "necessary" 
information  – it may be very difficult to ascertain whether information is "second -best" or most 
 
103 We note the absence in Article 6.8 and Annex II of the Anti -Dumping Agreement of a reference to an 
"interested Member". We also note that Article 6.11(ii) of the Anti -Dumping Agreement indicates that the term 
"interested parties" for purposes of that agre ement includes "the government of the exporting Member".  
104 Appellate  Body Report, US – Carbon Steel (India) , para.  4.423.  
105 Korea's  response to Panel question No.  49, para.  3. (emphasis original)  
106 Korea's  response to Panel question No.  49, para.  7. 
107 Korea's response to Panel question No.  49, para.  8. 
108 United  States'  comments on Korea's  response to Panel question No.  49, para.  3. 
109 Korea's  response to Panel question No.  49, para.  5. 
110 See, e.g. International Court of Justice, Case Concerning the Arbitral Award of 31 July 1989 
(Guinea -Bissau v. Senegal), Judgment, I.C.J. Reports 1991, p. 53, para.  56. See also Panel Report, 
Guatemala  – Cement II , para. 8.162.  
111 Panel Report, US – Hot-Rolled Steel , para.  7.55. WT/DS539/ R 
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  "accurate"  in the  abstract .112 Rather, the important, albeit general, goals of selecting the "best 
information available" and arriving at an "accurate" determination are operationalized and made 
effective through the very specific obligations under Article  6.8 and the provisions of Annex  II that 
bear upon an investigating authorit y's conduct  in a given case . The fact that, in selecting the  
replacements , investigating authorities are entitled to take into upon the "procedural circumstances 
in which the information is mis sing"113 further supports the view that , within the realm of facts 
available,  the "best information available", or  an "accurate" determination, is simply one that results 
from complying with the obligations in  Article  6.8 and  Annex  II in the specific facts and 
circumstances of a given case .114  
Relatedly, the parties disagree on the need for a "comparative evaluation" of all the 
information that is available to an investigating authority. Korea argues that an "investigating 
authority must undertake a comparat ive evaluation to ensure that it is using the 'best 
information ' available; i.e. the most fitting or 'most appropriate ' information available in the case at 
hand" .115 The United  States  rebuts that "neither Article  6.8 nor Annex  II of the 
Anti-Dumping  Agreement  contains the term 'comparative evaluation'" .116  
To the extent that Korea suggests that investigating authorities are always  under an obligation  
to undertake a "comparative evaluation" in all circumstances, we recall that the Appellate  Body 
rejected a similar argument under Article  12.7 of the SCM  Agreement  in US – Carbon Steel (India) . 
Rejecting "Indi a's argument that Article  12.7 of the SCM  Agreement  requires a comparative 
evaluation of the 'facts available ' in every case"117, the Appellate  Body explained that "the extent to 
which an 'evaluation ' of the 'facts available ' is required under Article  12.7, and the form it should 
take, depend on the particular circumstances of a given case, including the quantity and quality of 
the available facts on t he record, and the types of determinations to be made in a given 
investigation" .118 Disagreeing with India 's "proposition that a 'comparative evaluation ' is a necessary 
pre-requisite to making a determination in every instance in which an investigating authority has 
recourse to the 'facts available'", the Appellate  Body explained that "[c]onceivably, there may be 
circumstances where the kind of 'comparative evaluation ' envisa ged by India is not practicable".119 
The treaty  text does not require a comparative evaluation in all  circumstances. As discussed, 
however, it does  require investigating authorities to select reasonable replacements for the missing 
"necessary" information . An examination of the "reasonableness" of the replacement facts implies 
an evaluation and the exercise of judgment  by an investigating authority, taking into account – in 
an objective and unbiased manner  – all facts that are properly before it  as well as t he procedural 
circumstances  in which the information is missing . In certain situations , it may well be that such an 
evaluative exercise would need to be comparative in nature. There may be other circumstances, 
however, in which there is no need to engage in a comparative evaluation or where another approach 
may be better suited.120 Although investigating authorities remain  at all times  under an obligation 
to take into account all information that is properly before them with a view to selecting reaso nable 
 
112 The notion of "best information available" is therefore better understood in the sense that there is 
"no better information" actually available to an investigating authority to serve as a reasonable replacement in 
a given situation. (Panel Report, Mexico – Anti-Dumping Measures on Rice , para.  7.166 (" for the conditions of 
Article  6.8 of the AD  Agreement and Annex  II to be complied with, there can be no better information available 
to be used in the particular circumstances")).  
113 We note Korea's  statement that the "degree of cooperation may be something  to take into 
consideration when weighing and balancing the pieces of information before the authority". (Korea's  response 
to Panel question No.  50, para.  10). 
114 We note Korea's  statement that "it is difficult to isolate the different paragraphs of Annex  II as they 
all reflect the same notion of using the 'best information available'  when it becomes necessary to rely on facts 
available under Article  6.8 of the Anti -Dumping  Agreement." (Korea's  response to Panel question No.  105, 
para. 145).  
115 Korea's  first written submission, para.  71. See also Korea's  response to Panel question No.  49, 
para. 4 ("such an 'inevitable'  exercise of selecting the 'best information available'  must necessarily entail a 
process of (comparative)  assessment and evaluation among the f acts that are available to the authority").  
116 United  States'  first written submission, para.  34.  
117 Appellate  Body Report, US – Carbon Steel (India) , para.  4.434.  
118 Appellate  Body Report, US – Carbon Steel (India) , para.  4.434.  
119 Appellate  Body Report, US – Carbon Steel (India) , para.  4.434.  
120 For example, the Appellate  Body has observed that "a comparative approach to the evaluation 
required would not be feasible where there is only one set of reliable information on the record that is relevant 
to a partic ular issue and may thus serve as a factual basis for a determination". ( Appellate  Body Report, 
US – Carbon Steel (India) , para.  4.434).  WT/DS539/ R 
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  replacements for the missing information , they enjoy a certain discretion in their choice of the means 
for discharg ing this obligation in light of the specific facts and circumstances of the case before them.  
For these reasons, we disagree with Korea  insofar as i t argues  that, under both the 
Anti-Dumping and the SCM  Agreement , "an investigating authority must undertake a comparative 
evaluation to ensure that it is using the 'best information ' available"121 in all circumstances. A 
comparative evaluation may not be a necessary prerequisite to making a determination in every  
instance in which an investigating authority resorts to  "facts available". Rather, we agree with the 
Appellate Body that the "extent" of the evaluation of the "fa cts available" that is required, and the 
"form" it should take, depend upon the "particular circumstances of a given case, including the 
nature, quality, and amount of the evidence on the record, and the particular determinations to be 
made" in a given inv estigation.122 
7.3  Kore a's "as applied" claims  
7.3.1   Anti-dumping duties on certain corrosion -resistant steel products from Korea 
(USDOC investigation number A -580-878)  
Introduction  
Korea claims that the United  States  acted inconsistently with Article  6.8 and Annex  II to the 
Anti-Dumping  Agreement  in the investigation concerning certain corrosion -resistant steel products 
from Korea (the "CORE AD investigation").123 Korea alleges that there was no basis for the USDOC 
to resort to facts available because "Hyundai Steel provided all information requested by the USDOC 
after spending substantial time, effort, and resources to comply with the extremely complex 
requests"124 and it "simply had a hard time making sense of the unguided request".125 Korea also 
claims that, in selecting the replacement facts, the USDOC used information from secondary sources 
without exercising special circumspection, and failed to ensure that the information selected was a 
reasonable replacement for the missing "necessary" information.126 Korea 's claims concern the 
USDOC 's use of facts available in relation to Hyundai Steel Corporation ( Hyundai Steel )'s sales to 
unaffiliated parties of further manufactured products where CORE was used as an input (i.e. skelp, 
sheet , and blanks (SSBs) ; tailor welded blanks (TWBs) ; and  auto parts).127 The USDOC assigned to 
these sales a dumping margin of 86.34% – the highest  margin available in the petition.128 
We begin by setting out the relevant factual background of the underlying investigation. 
Subsequently, we summarize the parties ' main arguments before examining Korea 's claims of 
 
121 Korea's  first written submission, para.  71.  
122 Appellate  Body Report, US – Carbon Steel (India) , para.  4.434. We note  Japan's  statement that a 
"comparative evaluation" of all evidence available is not necessarily required in "each and every case", but an 
"investigating authority should be able to explain, with sufficient basis, what evaluation it undertook". 
(Japan's  third-party submission, para. 22).  
123 Korea's  first written submission, para.  86. 
124 Korea's  first written submission, para.  144. 
125 Korea's  first written submission, para.  135.  
126 Korea's  first written submission, paras.  88 and 185.  
127 Korea's  first written submission, para.  96. The USDOC excused Hyundai Steel from reporting further 
manufactured sales when the first unaffiliated sale was of the final product (a completed automobile). 
(Korea's  first written submission, para.  96; CORE issu es and decision memorandum , (Exhibit  KOR-5), p.  9). 
According to Korea,  [[***]]% of US sales of CORE by Hyundai Steel were made directly to unaffiliated 
US customers; [ [***]]% were sold through Hyundai Steel's  affiliated Korean distributor, Hyundai Corpora tion, 
who, in turn, sold the products to its US subsidiary Hyundai Corporation USA; and, finally, [[ ***]]% of the 
US sales were made through Hyundai Steel's  wholly -owned US affiliate, Hyundai Steel America (HSA). HSA, in 
turn, dealt with these products in one of the three ways: it resold the CORE as coil; it performed minor 
processing (slitting, shearing, or stamping) and sold the resulting products as SSBs; or it consumed the CORE 
in manufacturing TWBs. Some of these products (coil, SSBs, and TWBs) were so ld to affiliated and unaffiliated 
vendors, who, after further processing, sold the resulting products (auto parts) to Hyundai Motor 
Manufacturing Alabama or Kia Motor Manufacturing Georgia, who used them to produce automobiles and sold 
the final products t o unaffiliated US customers through their affiliated distributors (Hyundai Motor America and 
Kia Motor America). ( Korea's  first written submission, paras.  93-95; CORE Section A questionnaire response, 
(Exhibit  KOR-2 (BCI)), pp.  A-1-A-2). 
128 Korea's  first wr itten submission, para.  121. WT/DS539/ R 
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  WTO-inconsistency in respect of the USDO C's resort to facts available and its selection of the 
replacement facts.  
Factual background  
In its initial questionnaire dated 27 July 2015129, the USDOC requested Hyundai Steel to 
respond to Sections A, B, C, and D, and noted that Hyundai Steel was not " currently" required to 
respond to Section E, concerning the "Cost of Further Manufacturing or Assembly Performed in the 
United  States ".130 However, the USDOC clarified that  "we may request a response to this section  if 
we determine, based on your response t o section  A, that we require the information to account for 
further -processing expenses incurred in the United  States ".131  
On 17 August 2015, Hyundai Steel sought an exemption from providing a Section E 
response132 and requested the USDOC to calculate the c onstructed export price (CEP ) based on the 
"special rule" provided in the US anti -dumping statute instead.133 In the meantime, Hyundai Steel 
submitted its Section A response on 4 September 2015134 and its Section C response on 
29 September 2015.135 On 15 October 2015, the USDOC denied Hyundai Steel 's request for a 
"special exemption" in respect of Section E136, and requested Hyundai Steel to file such a response 
for the products concerned and to make any necessary revisions to its Sections C -D databa ses in 
accordance with its Section E reporting.137 On 22 October 2015, Hyundai Steel requested "a meeting 
with and guidance from " the USDOC, noting difficulties in collecting and preparing the data to 
conform to the USDOC's "standard questionnaire".138 Hyund ai Steel also requested an extension of 
two weeks to submit its further manufacturing cost data, from the date that the USDOC provided 
such reporting guidance. On 27 October 2015, Hyundai Steel's counsel met with the USDOC officials 
to discuss issues relat ing to Hyundai Steel's Section E response.139 
On 2 November 2015140, Hyundai Steel submitted a revised US sales database (originally 
submitted on 29 September 2015 ) including the further manufactured sales and its first Section  E 
 
129 CORE anti -dumping questionnaire to Hyundai Steel, (Exhibit  KOR-6). 
130 CORE anti -dumping questionnaire to Hyundai Steel, (Exhibit  KOR-6), p.  2. 
131 CORE anti -dumping questionnaire to Hyundai Steel, (Exhibit  KOR-6), p.  2. 
132 Hyunda i Steel exclusion request, (Exhibit  KOR-7 (BCI)), p.  2. 
133 The "special rule" concerns the calculation of the CEP for subject merchandise imported by an 
affiliated person when the "value added in the United  States by the affiliated person is likely to excee d 
substantially the value of the subject merchandise " (19 U.S.C. § 1677a, (Exhibit  KOR-3), Section (e) 
(emphasis added)) . The value added in the United  States will normally be determined to "exceed substantially" 
the value of the subject merchandise if the  value added is estimated to be "at least 65 percent of the 
price charged to the first unaffiliated purchaser for the merchandise as sold in the United  States". 
(CFR § 351.402(c), (Exhibit  KOR-4)). In such situations, the "special rule" envisages the calcu lation of the CEP 
on the basis of a comparison with the price of identical subject merchandise or other subject merchandise sold 
by the exporter or producer to an unaffiliated person, provided that there is a "sufficient quantity of sales to 
provide a reas onable basis for comparison". (19 U.S.C. § 1677a, (Exhibit  KOR-3), Section (e)).  
134 CORE Section A questionnaire response,  (Exhibit  KOR-2 (BCI)).  
135 CORE Section E questionnaire response, (Exhibit  KOR-15 (BCI)), p.  1. 
136 USDOC response to exclusion request, ( Exhibit  KOR-11), p.  1. In its final determination, the USDOC 
explained that:  
Hyundai [Steel]'s  TWBs consist of two subject merchandise CORE inputs. Yet, Hyundai 
[Steel]'s  value added calculations for TWBs treated one imported CORE component as part of the 
value added in the United  States to the other imported CORE component, and then doubled the 
purchase price for the further manufactured product as part of the calculation of the value added. 
Instead of allocating the value added in the United  States to eac h subject CORE component of the 
TWB (two subject CONNUMs), Hyundai [Steel] added the value of one subject CONNUM to the 
other as value added, e.g., thereby inflating the value added through further manufacturing to 
approach the 65 percent threshold. Thus, the [USDOC] instructed Hyundai to report its sales of 
these two products to unaffiliated parties along with the revised U.S. sales and further 
manufacturing cost databases.  
(CORE issues and decision memorandum,  (Exhibit  KOR-5), p.  9 (emphasis original))  
137 USDOC response to exclusion request, (Exhibit  KOR-11), pp.  1-2. 
138 Hyundai Steel request for extension and additional guidance, (Exhibit KOR -13). 
139 Meeting with counsel to Hyundai Steel (27 October 2015), (Exhibit KOR -14). 
140 The USDOC originall y provided Hyundai Steel to file its responses by 29 October 2015, but 
subsequently provided an extension of two business days following a request by Hyundai Steel. (See USDOC 
response to exclusion request, (Exhibit  KOR-11), p.  2; CORE Section E questionna ire response, 
(Exhibit  KOR-15 (BCI)), p.  6). WT/DS539/ R 
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  response.141 On 19 November 2 015, the USDOC issued its second supplemental questionnaire to 
Sections B -C and first supplemental questionnaire for Section E, noting that it had "identified certain 
areas in the questionnaire response … that require[d] additional information".142 In a mee ting on 
24 November 2015, held in order to discuss issues relating to Hyundai Steel's reporting of further 
manufactured sales in the United States, Hyundai Steel noted the difficulty in gathering the 
information requested.143 On 30 November  2015, Hyundai St eel filed its first supplemental Section  E 
response with additional and revised sales data.144 The USDOC issued a second supplemental 
questionnaire on 15  December  2015, seeking, inter alia , an explanation for certain "downward" 
changes in the first supplemental Section  E response145, and asking Hyundai Steel to provide, if 
necessary, "a new further manufacturing cost database which incorporates all changes resulting 
from the questions above".146 
On 21 December 2015, the USDOC issued its preliminary determination, finding that 
"necessary information is not available on the record of the investigation and that Hyundai  [Steel] , 
because of the issues affecting its further manufactured sales responses … significantly impeded the 
proceeding".147 The USDOC observed that "the response and databases for sales of further 
manufactured sales submitted by Hyundai  [Steel] as part of its November 2, 2015 response [i.e. the 
initial questionnaire response] were deficient and unusable", and due to the multip le deficiencies 
noted, Hyundai Steel had been instructed to submit revised, usable databases.148 Noting that 
Hyundai Steel submitted revised responses and databases on 2 December 2015, the USDOC 
explained that there was "inadequate time to analyze whether t he revisions made by Hyundai to its 
responses or databases are reliable or accurate" and its analysis of these responses was hindered 
by shortcomings in the narrative portion of Hyundai Steel 's responses. Given that Hyundai Steel did 
not provide revised da ta "until very recently", it was "not practicable" for the USDOC to provide 
Hyundai Steel with another opportunity to remedy its further manufactured sales responses prior to 
the preliminary determination, and the USDOC intended to "provide such … an oppor tunity in the 
weeks ahead".149 
Following the preliminary determination, Hyundai Steel filed its second supplemental 
Section  E response on 29 December 2015150, which included changes to further manufacturing costs 
and sales databases based on its response.151 In its third supplemental Section E questionnaire 
(5 February 201 6) the USDOC identified and sought explanations for certain discrepancies between 
Hyundai Steel 's second supplemental Section E response and its initial response152, but instructed 
Hyundai Ste el not to "submit any new or revised sales, cost, or further manufacturing databases in 
response".153 Hyundai Steel responded on 10 February 201 6 (third supplemental Section E 
response), providing explanations for the USDOC 's perceived discrepancies.154 On 8 March 2016, 
the USDOC informed Hyundai Steel of its decision to cancel the CEP verification of further 
manufactured sales.155 In so doing, the USDOC determined that the information for the further 
manufactured sales is "unverifiable and deficient".156 The U SDOC noted that the further 
manufactured sales databases (sales and cost ) submitted on 30 November 2015 and 
29 December  2015 "show inconsistencies, and contain multiple unexplained, or insufficiently 
explained, changes".157 On 11 March 2016, Hyundai Steel c ommunicated to the USDOC a request 
 
141 CORE Section E questionnaire response, (Exhibit  KOR-15 (BCI)), pp.  4-8. 
142 CORE first supplemental Section E questionnaire, (Exhibit  USA-5 (BCI)), p. 1.  
143 Meeting with counsel to Hyundai Steel (27 November 2015 ), (Exhibit KOR -16). 
144 CORE first supplemental Section E questionnaire response, (Exhibit  KOR-18 (BCI)), pp.  S-1-S-2. 
145 CORE second supplemental Section E questionnaire response, (Exhibit  KOR-19 (BCI)), p.  4. 
146 CORE second supplemental Section E questionna ire response, (Exhibit  KOR-19 (BCI)), p.  10. 
147 CORE issues and decision memorandum on PDM, (Exhibit  USA-8), p.  14. 
148 CORE issues and decision memorandum on PDM, (Exhibit  USA-8), p.  13. (fn  omitted)  
149 CORE issues and decision memorandum on PDM, (Exhibit  USA-8), p.  13. 
150 CORE second supplemental Section E questionnaire response, (Exhibit  KOR-19 (BCI)), p.  5.  
151 CORE second supplemental Section E questionnaire response, (Exhibit  KOR-19 (BCI)), p.  5.  
152 Hyundai Steel response to supplemental Section E questionnaire, (Exhibit  KOR-17 (BCI)), p.  1. 
153 Hyundai Steel response to supplemental Section E questionnaire, (Exhibit  KOR-17 (BCI)), p.  1. 
154 Hyundai Steel response to supplemental Section E questionnaire,  (Exhibit  KOR-17 (BCI)), pp.  2-3. 
155 USDOC letter of cancellation of verification, (Exhibit  KOR-20). 
156 USDOC letter of cancellation of verification, (Exhibit  KOR-20), p.  1. 
157 USDOC letter of cancellation of verification, (Exhibit  KOR-20), pp.  1-2. WT/DS539/ R 
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  to reconsider its decision not to verify further manufactured sales.158 In its case brief filed on 
22 April 2016, Hyundai Steel addressed, inter alia , the USDOC's decision to cancel verification.159 
In its final determination dated 2 June 2016160, the USDOC decided to resort to "partial facts 
available" on the basis that "necessary information [was] not on the record, Hyundai  [Steel]  failed 
to submit information by the established deadlines, and Hyundai [Steel] ha[d] significantly impeded 
the proceeding".161 Recalling its discussion of the shortcomings identified in its preliminary 
determination, the USDOC found that Hyundai Steel 's first and second supplemental Section E 
responses were "severely deficient" and its third response "was riddled with inconsistencies and 
effectively made unsolicited changes to its reporting in its further manufactured cost and in its sales 
databases".162 Observing that "Hyundai [Steel] has submitted a series of inaccurate value added 
calculations and discredited claims of difficulty in gathering data and Section E responses that were 
unusable, unreliable, and unverifiable", the USDOC found that Hyundai Steel , "with respect to its 
further manufactured U.S.  sales of TWBs, auto parts, skelp, b lanks, and sheets, failed to cooperate 
by not acting to the best of its ability to comply with requests for information in this investigation".163 
As the replacement for the missing information, the USDOC selected the highest dumping margin in 
the petition of 86.34%.164 
Main a rguments of the parties  
Korea claims that the USDOC resorted to the use of facts available inconsistently with 
Article  6.8 of the Anti -Dumping  Agreement  because there was no "necessary" information missing 
concerning further manufactured  sales, and because Hyundai Steel did not "significantly impede []" 
the investigation.165 According to Korea, Hyundai Steel reported all the relevant input data (raw 
material input and sales quantity data ) that would have allowed the USDOC to "apply whatever  
methodology it deemed appropriate, including its standard methodology or an alternative 
methodology".166 
Korea further claims that the USDOC acted inconsistently with paragraph  1 of Annex  II 
because it (a ) failed to provide details of the information required "as soon as possible after 
initiation"; (b ) failed to "specify in detail " the information required and the manner in which that 
information was to be structured; and (c ) failed to give a reasonable period of time for Hyundai Steel 
to provide the requested information.167 Korea contends that , having "originally determined  that 
Hyundai Steel did not have to file a Section E response"168, the USDOC requested a Section  E 
response "almost four months after [the] initiation of the investigation", and "did not specify how it 
wanted the information to be presented and structured" in light of the reporting concerns expressed 
early on by Hyundai Steel.169 According to Korea, despite Hyundai Steel 's repeated attempts, the 
USDOC "did not engage with Hyundai Steel on these requests and never provided guidance on which 
information it specifically needed in addition to the comprehensive raw data that wa s already 
provided".170 Finally, Korea alleges that considering the sheer volume of information required by the 
USDOC, and the difficulty in tracing all transactions for further manufacturing, the USDOC should 
have given a more reasonable deadline to submit  the Section E response, instead of the short 
14-day period it provided.171 
Korea also claims that the USDOC acted inconsistently with paragraph  6 of Annex  II by failing 
to inform Hyundai Steel of the reasons for disregarding the submitted information, and by denying 
 
158 Hyundai Steel request to reconsider the cancellation of verification , (Exhibit  KOR-21). 
159 CORE case brief, (Exhibit KOR -23 (BCI)).  
160 CORE final determination , (Exhibit  KOR-27). 
161 CORE issues and decision memorandum, (Exhibit  KOR-5), p.  38. 
162 CORE issues and decision memorandum , (Exhibit  KOR-5), p.  16. 
163 CORE issues and decision memorandum , (Exhibit  KOR-5), p.  16. 
164 CORE issues and decision memorandum , (Exhibit  KOR-5), p.  17. 
165 Korea 's first written submission, para.  129. 
166 Korea's  response to Panel question No.  1(a); first written submission, paras.  132 and 134 (referring 
to Hyundai Steel response to supplemental Section E questionnaire, (Exhibit  KOR-17 (BCI)), pp.  1-5).  
167 Korea's  first written submission, para.  150.  
168 Korea's  first written submission, para.  151 (emphasis added). See also CORE anti -dumping 
questionnaire to Hyundai Steel, (Exhibit KOR -6), p.  2 
169 Korea's  first written submission, paras.  151-152. 
170 Korea's  first writte n submission, para.  152.  
171 Korea's  first written submission, para.  155. WT/DS539/ R 
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  Hyundai Steel an opportunity to provide further explanations.172 Korea argues  that the second and 
the third supplemental Section E questionnaires did not constitute "opportunities to provide any new 
information or to conform to any request from t he USDOC other than responding to very limited 
questions", and that these questionnaires only raised practical problems in respect of which 
Hyundai  Steel had already sought guidance from the USDOC.173 
Korea also claims that the USDOC acted inconsistently wi th paragraph  3 of Annex  II by 
disregarding information which was "verifiable" as "it could have been verified had the USDOC not 
canceled [ sic] the planned verification", and that was "'appropriately submitted ' given that 
Hyundai  Steel supplied the data by the deadlines in question and provided all of the raw data needed 
to structure the information differently, if this is what the USDOC considered necessary".174 This 
information was also provided "in a timely fashion" as it complied with all deadlines.175 Korea also 
claims that the USDOC acted inconsistently with paragraph  5 of Annex  II by disregarding the 
information submitted by Hyundai Steel that, even if not ideal, was provided by it acting to the best 
of its ability .176  
As to the USDOC 's selection of t he replacement facts, Korea claims that the USDOC acted 
inconsistently with Article  6.8 and paragraph  7 of Annex  II by failing to corroborate properly the 
selected  replacement  and by not exercising special circumspection in considering the reliability and 
accuracy of the "secondary source information ".177 According to Korea, the USDOC improperly 
confirmed the reliability of the petition rate on the basis of its pre -initiation analysis.178 Korea argues 
that the only other basis for relying on the petition rate  was that the USDOC found it to be equal to 
or below certain product -specific margins for coils.179 Korea argues that the USDOC did not engage 
in a process of reasoning or evaluation, but instead resorted to the highest petition margin because 
that was its "practice".180 Finally, Korea argues that the USDOC 's application of facts available was 
not objective or fair, but punitive in nature.181 
In response to Korea's argument that there was no "necessary" information missing because 
Hyundai Steel had provided al l the relevant data that would have allowed the USDOC to apply the 
alternative methodology that Hyundai Steel had proposed, the United States contends that "this 
argument ignores that [the] USDOC specifically considered and rejected Hyundai's 'alternative 
methodology'".182 The United  States  maintains that the USDOC decided not to apply the alternative 
methodology proposed by Hyundai Steel given that it had failed to demonstrate that the value added 
in the United  States  exceeded the threshold of 65% of the imported coil, which was a precondition 
for the  application of the "special rule".183 The United States stresses that Korea has not challenged 
this determination.184 The United States contends that, c ontrary to Korea 's arguments, 
Hyundai  Steel was offered three opportunities to correct deficiencies, and multiple opportunities to 
meet with the USDOC in response to its requests for guidance.185 According to the United  States , 
Hyundai Steel 's reporting constituted a significant impediment because of the delays and because it 
consistently provided unusable inf ormation.186 
With respect to Korea 's claim under paragraph  1 of Annex  II, the United  States  responds that, 
although the USDOC did not initially require Hyundai Steel to respond to the Section E questionnaire, 
it did "alert" Hyundai Steel to the possibility of requiring such information in the future depending 
on Hyundai Steel 's Section A response.187 The United  States  maintains that the USDOC specified 
 
172 Korea's  first written submission, paras.  157-160. 
173 Korea's  second written submission, para.  36. 
174 Korea's  first written submission, paras.  164 and 167.  
175 Korea's  first written subm ission, para.  168. 
176 Korea's  first written submission, paras.  171 and 173.  
177 Korea's  first written submission, paras.  185 and 187 -191. 
178 Korea's  first written submission, para.  186. 
179 Korea's  first written submission, para.  190. 
180 Korea's  first written submission, para.  192. 
181 Korea's  first written submission, para.  196. 
182 United  States'  first written submission, para.  64. 
183 United  States'  first written submission, para.  64. 
184 United  States'  first written submission, para.  65. 
185 United  States'  first written submission, paras.  68-69.  
186 United  States'  first written submission, para.  70 (referring to CORE issues and decision 
memorandum, (Exhibit  KOR-5), p. 14).  
187 United  States'  first wri tten submission, para.  73 (referring to CORE anti -dumping questionnaire to 
Hyundai Steel, (Exhibit  KOR-6)). WT/DS539/ R 
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  precisely and in great detail what was required from Hyundai  Steel, and also provided written and 
oral clari fications.188 The United  States  highlights that the USDOC offered multiple opportunities to 
Hyundai Steel over the course of almost five months – from 11 September 2015 until 
20 February  2016 – to respond adequately to the USDOC 's requests for the further -manufactured 
information, including issuing a total of five supplemental requests for the same information.189 
According to the United  States , the USDOC "went to great lengths to understand and address 
Hyundai  [Steel] 's purported difficulties"190 and provided specific guidance and asked follow -up 
questions aimed at remedying the discrepancies in Hyundai Steel 's responses.191 
The United  States  also contends that the USDOC acted in accordance with paragraph  6 of 
Annex  II because it explained why the information submitted was not verifiable in its letter cancelling 
the verification for the further manufactured sales.192 The USDOC also provided mul tiple 
opportunities to Hyundai Steel to furnish further explanations.193 The United  States  maintains  that 
the USDOC acted consistently with paragraphs 3 and 5 of Annex  II as Hyundai Steel 's responses 
were not "verifiable " and could not be used "without undu e difficulties" because of the multiple 
deficiencies therein .194 Finally, the United  States  argues that Hyundai Steel did not submit 
information "to the best of its ability" because it repeatedly provided unusable data despite the 
multiple opportunities.195 
The United  States  asserts that the USDOC acted consistently with paragraph  7 of Annex  II, 
as it corroborated the petition margin to the extent practicable using sources that were reasonably 
at its disposal, and used special circumspection in determining wh ether the rates alleged in the 
petition were relevant and reliable for purposes of using them as replacement facts for Hyundai  
Steel's further manufactured sales.196 The United  States  explains that the USDOC found the rate to 
be relevant and reliable becaus e the rate was derived from information from the CORE industry and 
was within the range of Hyundai  Steel's reported product -specific margins for coil.197 The 
United  States  contends that, despite arguing there was "better information on the record", Korea 
offers no alternative.198 According to the United  States , the USDOC 's selection was not made on the 
"sole basis" of the adverse inference.199 
Evaluation by the Panel  
7.3.1.4.1   The USDO C's resort to facts available  
Korea claims that the USDOC acted inconsistently with Article  6.8 and paragraphs 1, 3, 5, 
and 6 of Annex  II of the Anti -Dumping  Agreement  in resorting to the use of facts available in respect 
of Hyundai Steel 's reporting of in formation concerning further manufactured sales.  
In its initial questionnaire dated 27 July 2015, the USDOC requested Hyundai Steel to respond 
to Sections  A-D, and clarified that it was not "currently" required to respond to Section  E.200 Contrary 
to Korea 's arguments, we do not consider that the USDOC "originally determined  that Hyundai Steel 
did not have to file a Section E response".201 Rather, in the letter accompanying its initial 
questionnaire, the USDOC clearly explained that a Section E response " may" be requested if it is 
"determine[d] " – based on Hyundai Steel 's Section A response – that "information to account for 
further -processing expenses incurred in the United  States " was required.202  
 
188 United  States'  first written submission, paras.  73-74. 
189 United  States'  first written submission, paras.  75-76. 
190 United  States'  response to Panel question No.  2(b), para.  11. 
191 United  States'  first written submission, para.  77. 
192 United  States'  first written submission, para.  81. 
193 United  States'  first written submission, paras.  83-84. 
194 United  States'  first written submission, paras.  90-92. 
195 United  States'  first written submission, para.  96. 
196 United  States'  first written submission, paras.  101 and 103.  
197 United  States'  first written submission, paras.  103-104. 
198 United  States'  first written submission, para.  102. 
199 United  States'  first written submission, para.  106. 
200 CORE anti -dumping questionnaire to Hyundai Steel, (Exhibit  KOR-6), p.  2. 
201 Korea's first written submission, para. 151. (emphasis added)  
202 CORE anti -dumping questionnaire to Hyundai Steel, (Exhibit  KOR-6), p.  2. (emphasis added)  WT/DS539/ R 
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Hyundai Steel 's subsequent conduct confirms that it was aware  of the possibility that it may 
be required to submit a Section E response. On 17 August 2015, before responding to the initial 
questionnaire, Hyundai Steel requested an exemption from the obligation to report sales that were 
substantially further manufact ured prior to sale to unaffiliated parties.203 Hyundai Steel requested 
the USDOC to calculate the CEP based on the "special rule" provided in the US anti -dumping 
statute.204 Specifically, Hyundai Steel argued, first, that the value added in the United  States  vastly 
exceeded 65% of the value of the imported merchandise. Second, Hyundai Steel stated that an 
examination of the further manufactured sales would be "unnecessarily a nd enormously 
burdensome" for the USDOC and there were other appropriate and reasonable bases to calculate 
the CEP.205 Third, Hyundai Steel argued that the finished merchandise (i.e. automobiles ) was not 
the "same class or kind" as the subject merchandise ( i.e. coils from CORE), and therefore the 
difficulty for applying the standard methodology would be very high for the USDOC.206 For these 
reasons, Hyundai Steel suggested that the USDOC could apply an "alternative methodology", similar 
to what had been adopt ed in prior cases, and determine dumping margins based on the 
weighted -average dumping margins calculated on sales of subject merchandise sold to unaffiliated 
persons, or, alternatively, to exclude from its calculations the sales of the further manufacture d 
products.207  
In its Section A response dated 4 September 2015, Hyundai Steel "respectfully suggest[ed]" 
that a Section E response was not required in the present case, and requiring such data would be 
"enormously burdensome" for both the USDOC and Hyunda i Steel.208 In a letter dated 
11 September  2015, the USDOC stated that it was still evaluating Hyundai Steel 's request for an 
exemption from the Section E response and requested certain additional information with respect to 
Hyundai  Steel's exemption reques t.209 Subsequently, in a teleconference with officials from the 
USDOC on 14  September 2015, Hyundai Steel stated that, based on the  USDOC 's request for 
information dated 11  September 2015, "it is unclear to Hyundai  [Steel] , what additional information 
it should have, or could have, submitted to further substantiate its request for the alternate 
calculation method".210 In the teleconference, the USDOC "agreed to follow up with additional 
guidance to Hyundai  [Steel] 's request for clarification".211 The USDOC provided such "additional 
guidance" on "[i]nformation [r]equired to [s]ubstantiate Hyundai Steel Corporation 's [r]equest for 
[a]lternative [c]alculation [m]ethod" through a letter dated 16  September 2015.212  
Following the USDOC 's guidance, Hyund ai Steel provided additional information regarding : 
the quantity and the value of sales by Hyundai Steel America  (HSA) , Hyundai Steel 's wholly owned 
US affiliate, to each of its affiliated and unaffiliated customers ; the value added by HSA prior to the 
sale to an unaffiliated vendor ; and the materials added to the merchandise under consideration by 
HSA or the unaffiliated vendors.213 The USDOC ultimately denied Hyundai Steel 's request for a 
"special exemption" on 15 October 2015, stating that Hyundai Steel h ad failed to demonstrate that 
the value added in the United  States  was equal to or greater than 65% of the imported coil with 
respect to Hyundai Steel 's further manufactured sales of certain auto parts, TWBs, and further 
processed TWB (after -service parts) .214 On this basis, the USDOC requested Hyundai Steel to 
 
203 CORE anti -dumping questionnaire to Hyundai Steel, (Exhibit  KOR-6), p.  2. 
204 19 U.S.C. § 1677a, (Exhibit  KOR-3). 
205 Hyundai Steel exclusion request, (Exhibit  KOR-7 (BCI)), pp.  4-7. 
206 Hyundai Steel exclusion request, (Exhibit  KOR-7 (BCI)), p.  15. By "standard methodology", Korea 
refers to the calculation of the constructed export price with the following adjustment:  
 Additional adjustments to constructed export price  
For purposes of this section, the price used to establish constructed export price shall also be  
reduced by –  
(1) … 
(2) the cost of any further manufacture or assembly (including additional material and labor), 
except in circumstances described in subsection  (e) of this section  …[.]  
(19 U.S.C. § 1677a , (Exhibit  KOR-3), Section (d))  
207 Hyundai Steel exclusion request, (Exhibit  KOR-7 (BCI)), pp.  15-16. 
208 CORE Section A questionnaire response, (Exhibit  KOR-2 (BCI)), p.  A-3. 
209 CORE initial questionnaire extension, (Exhibit  USA-3), p.  2. 
210 USDOC teleconferen ce with Hyundai Steel, (Exhibit  KOR-9). 
211 USDOC teleconference with Hyundai Steel, (Exhibit  KOR-9). 
212 USDOC additional guidance, (Exhibit  USA-4), p.  3. 
213 CORE response to request for additional information, (Exhibit  KOR-10 (BCI)).  
214 USDOC response to exclusion request, (Exhibit  KOR-11), p.  1. See also CORE issues and decision 
memorandum,  (Exhibit  KOR-5), p.  9. Although arguing that "the application of the USDOC's  standard 
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  provide, inter alia , a Section E response.215 The USDOC also asked Hyundai Steel to make any 
necessary revisions to its Sections C -D databases in accordance with its further manufactured 
products repor ting216, and to submit its responses by 29 October 2015.217 
We disagree with Korea 's argument  that the USDOC "originally determined " that 
Hyundai  Steel did not have to file a Section E response.218 Rather, we note that the USDOC originally 
informed Hyundai Steel that such a determination would be made at a later stage, based upon 
Hyundai Steel 's initial Section  A response.219 We also disagree with Korea that the USDOC acted 
inconsistently with paragr aph 1 because "[t]his instruction came almost four months after initiation 
of the investigation".220 Not only does the above sequence of events show that Hyundai Steel was 
aware from the outset that it could subsequently be asked to submit a Section E respo nse, but it 
also indicates that the timing of the USDOC 's decision to request a Section E response may have 
been influenced by Hyundai Steel 's exemption request and the USDOC 's consideration thereof.  Thus, 
we reject Korea 's argument that the USDOC acted in consistently with paragraph  1 of Annex  II 
because it failed to specify in detail the information required "as soon as possible after initiation".  
We now turn to Korea 's second argument that the USDOC acted inconsistently with 
paragraph  1 of Annex  II becaus e it failed to "specify in detail" the information required and the 
manner in which that information was to be structured. We recall that, a week after the 
USDOC 's rejection of Hyundai Steel 's exemption request, on 22 October 2015, Hyundai Steel 
requested guidance from the USDOC on how sales and related further manufacturing costs data 
should be reported221, as well as a two -week extension from the time the USDOC provides such 
guidance.222 Hyundai Steel explained that although it was "working diligently" to collect the 
requested data, due to the "complexities" of the products at issue, the USDOC 's standard 
questionnaire does not address how Hyundai Steel should report sales of TWBs or after -service 
parts.223 Hyundai Steel noted that the USDOC 's "basic instructions for reporting sales and costs for 
further manufacturing" "presume that there is only one imported [control number ( CONNUM )] in 
each U.S. further manufacture ( i.e., finished good ) sale" and thus "envision that the [USDOC]  will 
start with the price of a finished good, subtract out the further manufacturing and other expenses, 
and derive a net price for the imported CONNUM" . Hyundai Steel argued that its "situation does not 
fit this par adigm"224: 
TWBs are manufactured by welding together flat -rolled sheets or blanks of different 
thicknesses, grades, and coatings into various shaped forms. In Hyundai Steel 's case, 
the TWBs manufactured from subject merchandise will consist of two CORE 
comp onents, generally with different CONNUMs. In order for the [USDOC]  to employ its 
standard margin calculation methodology, it must segregate each transaction into two 
components in order to calculate a net price for each imported CONNUM.  
In addition, the fu rther manufacturing costs (which are calculated by finished 
good) must also be allocated between the two imported components. Moreover, the 
value added for any given component necessarily includes the second imported 
component required to manufacture the f inished TWB. That is, in these circumstances, 
each component of the TWB is both further processed subject merchandise and 
simultaneously part of the value added. After -service auto parts are still more complex 
containing more CONNUMs (although the number o f CONNUMs will vary from part to 
part), as well as non -subject merchandise. For all practical purposes, these parts are 
 
methodology in the CORE investigation to Hyundai Steel's  further-manufactured sales was virtually 
impossible", Korea does not directly challenge the USDOC's  decision to reject Hyundai Steel's  exemption 
request and apply the "standard methodology". (Korea's  response to Panel question No.  1(a)).  
215 USDOC response to exc lusion request, (Exhibit  KOR-11), pp.  1-2. 
216 USDOC response to exclusion request, (Exhibit  KOR-11), p.  2.  
217 USDOC response to exclusion request, (Exhibit  KOR-11), p.  2. 
218 Korea's  first written submission, para.  151. (emphasis added)  
219 The USDOC stated tha t Hyundai Steel was "not currently required to respond to section E", and 
added that "[h]owever, we may request a response to this section if we determine , based on your response to 
section A, that we require the information to account for further -processi ng expenses incurred in the 
United  States". (CORE anti -dumping questionnaire to Hyundai Steel, (Exhibit KOR -6), p. 2 (emphasis added)).  
220 Korea's  first written submission, para.  151. 
221 Hyundai Steel request for extension and additional guidance, (Exhibit  KOR-13), p.  2. 
222 Hyundai Steel request for extension and additional guidance, (Exhibit  KOR-13), p.  2. 
223 Hyundai Steel request for extension and additional guidance, (Exhibit  KOR-13), p.  1. 
224 Hyundai Steel request for extension and additional guidance, (Exhi bit KOR-13), p.  2. WT/DS539/ R 
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  only slightly less complex than the automobiles produced by Hyundai Steel 's U.S. 
affiliates.225 
Because of these complexities, Hyundai St eel sought "guidance and additional clarifications" from 
the USDOC in its preparation of the revised sales data and further manufacturing data.226 
On 27 October 2015, representatives of Hyundai Steel met with USDOC officials "to discuss 
issues related" to H yundai Steel 's request of 22 October 2015.227 The memorandum for the meeting 
does not indicate whether the USDOC provided any "guidance" to Hyundai Steel. However, other 
record evidence suggests that in response to Hyundai Steel 's requests, the USDOC grante d an 
extension of two "business days " and indicated that Hyundai Steel "should do its best to adapt the 
reporting requirements to the complex factual pattern presented here".228  
On 2 November 2015, Hyundai Steel submitted its first response to the USDOC 's request for 
a Section E questionnaire and certain additional information, wherein it reiterated the complexity of 
the information requested with respect to after -service auto parts, providing specific examples, and 
continued to maintain that this s ituation qualified for the "special rule" for an alternative calculation 
methodology.229 Hyundai Steel also explained that it "has been unable to eliminate those products 
that did not contain Hyundai Steel -manufactured subject merchandise, but has conservatively 
reported all transactions that theoretically could contain subject merchandise".230 It further noted 
that it had been unable to identify the specific steel components contained in the finished product, 
and therefore conservatively assumed tha t each product contained four CONNUMs.231  
Paragraph 1 of Annex  II requires, inter alia , that an investigating authority must " specify in 
detail  the information required from any interested party, and the manner in which that information 
should be structure d by the interested party in its response".232 Although Article  6.8 and paragraph  1 
of Annex  II do not provide any guidance as to how an investigating authority is to "specify in detail" 
the information it requires233, we note that the general evidentiary ru le contained in Article  6.1 of 
the Anti -Dumping  Agreement  requires that "[a]ll interested parties in an anti -dumping investigation 
shall be given notice of the information which the authorities require". In contrast to Article  6.1, 
paragraph  1 of Annex  II is more "specific and detailed" and requires more than mere "notice" being 
given to the interested parties.234 The context provided by paragraphs 5 and 7 of Annex  II, as well 
as Article  6.13, suggests that "'cooperation ' is, indeed, a two -way process involv ing joint effort" and , 
"[i]f the investigating authorities fail to 'take due account ' of genuine 'difficulties ' experienced by 
interested parties, and made known to the investigating authorities, they cannot … fault the 
interested parties concerned for a l ack of cooperation".235  
Further , an assessment of whether an investigating authority acted consistently with 
paragraph  1 of Annex  II must be made in light of the specific facts and circumstances of the 
investigation at issue. In light of the applicable sta ndard of review, an investigating authority would 
act consistently with paragraph  1 of Annex  II if the record of the investigation shows that the 
investigating authority took all reasonable steps that might be expected from an  objective and 
unbiased  authority to specify in detail the information requested, and the manner in which it is to 
be structured, as soon as possible after initiation.236 
In the case at hand, the United  States  acknowledges that, until the USDOC 's decision dated 
15 October  2015, t he USDOC was focused on the exemption request and did not provide guidance 
 
225 Hyundai Steel request for extension and additional guidance, (Exhibit  KOR-13), pp.  2-3. 
226 Hyundai Steel request for extension and additional guidance, (Exhibit  KOR-13), p.  3. 
227 Meeting with counsel to Hyundai Steel (27 October 2015), (Exhibit  KOR-14). 
228 CORE Section E questionnaire response, (Exhibit  KOR-15 (BCI)), p.  6. 
229 CORE Section E questionnaire response, (Exhibit  KOR-15 (BCI)), pp.  4-5. 
230 CORE Section E questionnaire resp onse, (Exhibit  KOR-15 (BCI)), p.  6. 
231 CORE Section E questionnaire response, (Exhibit  KOR-15 (BCI)), p.  7. 
232 Emphasis added.  
233 Panel Report, China – Autos (US) , para.  7.129.  
234 Panel Report, China – Autos (US) , para.  7.122 and fn  213. 
235 Appellate  Body Report, US – Hot-Rolled Steel , para.  104. 
236 Panel Report, China – Autos (US) , para.  7.130.  WT/DS539/ R 
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  to Hyundai Steel on how to complete a Section E questionnaire.237 Indeed, there is nothing in the 
record to indicate that the USDOC addressed or engaged with the reporting difficulti es that were 
identified by Hyundai Steel prior to its rejection of Hyundai Steel 's exemption request on 
15 October  2015.238  
Following the USDOC 's 15 October 2015  decision to deny Hyundai Steel 's exemption request 
and seek a Section E response, Hyundai Stee l, on 22 October 2015, reiterated its previously 
identified reporting difficulties and expressly sought additional guidance from the USDOC. A meeting 
was held between USDOC officials and Hyundai  Steel on 27 October 2015, but the record indicates 
that the U SDOC merely suggested that Hyundai Steel "should do its best to adapt the reporting 
requirements to the complex factual pattern presented here".239  
Although the United  States  points out the limited purpose that meeting memoranda serve 
under US domestic law240, it is unable to point to any other  evidence  demonstrating that the USDOC 
did, in fact, provide additional guidance to Hyundai Steel during their meeting on 27 October 2015.241 
Furthermore, we note the USDOC 's explanation – as part of its final determina tion – that "it is not 
within the purview of the [USDOC]  to tell Hyundai [Steel] how its accounting system and overall 
management system works, and it lies clearly with Hyundai [Steel] how best to report its further 
manufactured sales within the [USDOC] 's required format" .242 Based on the above, we find that the 
USDOC did not provide any additional guidance to Hyundai Steel during their meeting on 
27 October  2015.  
According to the United  States , additional "guidance" was provided by the USDOC as part of 
its supplemental questionnaires. Specifically, the United  States  submits that the USDOC issued 
three  supplemental questionnaires that provided "specific guidance to Hyundai Steel by identifying 
deficiencies with Hyundai Steel 's responses and providing question s to help Hyundai Steel correct or 
clarify its responses".243 Identifying deficiencies in an interested part y' response may not be the 
same as providing guidance at the time the information was originally requested . In the specific 
circumstances of this case, identifying deficiencies in Hyundai Steel 's responses is distinct from 
specifying in detail the information that was required and the manner in which it should be structured 
"as soon as possible after the initiation of the inves tigation". For this reason, even if we find that the 
three supplemental questionnaires issued by the USDOC identified  deficiencies in 
Hyundai  Steel's responses, this does not, without more, establish compliance with paragraph  1 of 
Annex  II in a situation w here Hyundai Steel had clearly identified certain reporting difficulties from 
the outset and repeatedly requested additional guidance.  
Finally, we note the United  States'  argument that the USDOC rejected Hyundai Steel 's claims 
of difficulty244, finding  that Hyundai Steel "made claims of difficulty in gathering data which were 
inaccurate".245 As the United  States  points out, the USDOC reached this finding in its final 
 
237 United  States'  response to Panel question No.  59, para.  37 (noting that, in the period prior to 
15 October 2015, "the focus of [the USDOC's] work w as on helping Hyundai [Steel] provide a complete and 
accurate request for exemption and not on providing guidance to Hyundai [Steel]  on how to complete a 
Section  E response " (emphasis added)).  
238 We disagree with the United  States that Hyundai Steel's  "claimed difficulties were not known" to the 
USDOC prior to Hyundai Steel's  letter dated 22 October 2015. (United  States'  response to Panel question 
No. 59, para.  38). The reporting difficulties identified in Hyundai Steel's  request for additional guidance on 
22 October 2015 were also flagged and discussed in Hyundai Steel's  earlier communication with the 
USDOC  concerning its exemption request on 17 August 2015. Hyundai Steel also raised these issues as part of 
its initial Section A questionnaire response (4 Sep tember 2015), as well as its response to the USDOC's  request 
for additional information concerning the exemption request. (Hyundai Steel exclusion request, 
(Exhibit  KOR-7 (BCI)), p.  13; CORE Section A questionnaire response, (Exhibit  KOR-2 (BCI)) , pp. A-42-A-43; 
and CORE response to request for additional information, (Exhibit  KOR-10 (BCI)), pp.  3-6).  
239 CORE Section E questionnaire response, (Exhibit  KOR-15 (BCI)), p.  6. 
240 United  States'  second written submission, paras.  27-28; response to Panel question N o. 58, 
paras.  27-28. 
241 More detailed summary is provided in the memoranda for other meetings. See, e.g. Meeting with 
counsel to Hyundai Steel (27 November 2015), (Exhibit  KOR-16); see also USDOC teleconference with 
Hyundai  Steel, (Exhibit  KOR-9). 
242 CORE is sues and decision memorandum, (Exhibit  KOR-5), p.  16. 
243 United  States'  second written submission, para.  29; response to Panel question No.  58, para.  32. 
244 United  States'  second written submission, para.  39 (quoting CORE issues and decision memorandum, 
(Exhibit KOR-5), pp.  16, 30, and 41).  
245 CORE issues and decision memorandum, (Exhibit  KOR-5), p.  41. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  determination on the basis that "Hyundai Steel initially reported that providing [the] USDOC with 
requested information would be too complicated, too burdensome, or not possible, but 
subsequently  … was able to provide the requested information" .246  
The fact that an interested party is ultimately able to overcome some of the difficulties that it 
initially identified does not necessarily detract from the genuineness of those difficulties from the 
outset. We note that, as part of its first supplemental Section E response, Hyundai Steel submitted 
that, although it had been able to collect additional in formation and refine its reporting, "these 
additional data should not be interpreted as a sign that Hyundai Steel has been 'holding back ' or 
that the reporting difficulties described to date have been over emphasized. Rather, Hyundai Steel 
and its affiliat es have worked tirelessly to collect and prepare the sales data provided herein" .247 We 
note that before Hyundai Steel was able to respond to the first supplemental Section E questionnaire, 
the USDOC had already stated that Hyundai Steel had "numerous opportunities to present this 
necessary information" concerning "further manufactured sale s in the United  States ", noting that 
"this information was explicitly requested in the original questionnaire", but, even "at this late date 
Hyundai [Steel] has not produced a usable database".248 Given that Hyundai Steel was given one 
opportunity to respond to the USDOC 's request for a Section  E response dated 15 October 2015 – 
and it had not yet submitted its response to the first supplemental questionnaire – we do not consider 
that Hyundai Steel had already been provided "numerous opportunities" to present this information. 
Furthermore, the USDOC 's comment that this information was explicitly requested in the original 
questionnaire and even at this "late date" Hyundai  Steel had not provided a usef ul information, must 
be seen in light of the fact that the USDOC did not determine that Hyundai Steel was required to 
submit a Section  E response until 15 October 2015. In these circumstances, we do not consider that 
the USDOC 's finding in its final determ ination that Hyundai Steel was able to overcome some of its 
initially reported difficulties would suggest to an impartial and objective investigating authority that 
those difficulties were not genuine at the time Hyundai  Steel was first asked to submit a S ection E 
response.  
Based on the above, we find that the USDOC failed to engage with, and address, the reporting 
difficulties that had repeatedly been raised by Hyundai Steel and thus did not provide any meaningful 
guidance at the time it requested a Secti on E response. In these circumstances, we find that the 
USDOC did not take all reasonable steps that would be expected from an objective and unbiased 
authority to "specify in detail" the information requested and "the manner in which th at 
information  shoul d be structured " within the meaning of paragraph  1 of Annex  II to the 
Anti-Dumping  Agreement . We therefore  find that the USDOC acted inconsistently with paragraph  1 
of Annex  II to the Anti -Dumping  Agreement .249 Given that  paragraph  1 of Annex  II serves as a 
precondition for an investigating authority 's proper resort to facts available under Article  6.8 of the 
Anti-Dumping  Agreement250, we find that the USDOC also acted inconsistently with that provision  in 
resorting to facts available  with respect to Hyundai Steel's reporting of information concerning 
further manufactured sales . In light of our findings of WTO -inconsistency, we do not consider it 
necessary to rule upon Korea 's claims under paragraphs 3, 5 , and 6 of Annex II to the 
Anti-Dumping  Agree ment in order to provide a positive solution to the dispute before us .251 
7.3.1.4.2   The USDOC 's selection of the replacement facts  
We have already found that the USDOC erred in resorting to facts available with respect to 
Hyundai Steel 's reporting of information concerning further manufactured sales. In these 
circumstances, we do not consider that making further findings on Korea 's claims concerning the 
USDOC 's selection of the replacement facts on the basis of the record used for the 
 
246 United  States'  second written submission, para.  39; response to Panel question No. 2(b), 
paras.  17-21. See also CORE issues and decision memorandum, (Exhibi t KOR-5), pp.  40-41. 
247 CORE first supplemental Section E questionnaire response, (Exhibit  KOR-18 (BCI)), p.  S-1. 
248 Meeting with counsel to Hyundai Steel (27  November  2015), (Exhibit  KOR-16). 
249 In light of our finding, we do not consider it necessary to add ress Korea's  argument that the USDOC 
acted inconsistently with paragraph  1 of Annex  II by failing to provide a reasonable period of time for 
Hyundai  Steel to furnish the requested information.  
250 Panel Report, China – GOES , paras.  7.384 -7.385. See also paras. 7.26-7.27 above.  
251 See, e.g. Panel Reports, EC – Salmon (Norway) , para.  7.387; and Morocco – Hot-Rolled Steel 
(Turkey) , paras.  7.105 -7.106.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  USDOC 's WTO-incon sistent findings would assist in providing a positive solution to the dispute before 
us.252 
Korea 's claims under Articles  1, 9.3, and 18.1 of the Anti -Dumping  Agreement  
Korea further claims that the USDOC 's use of facts available inconsistently with Article  6.8 
and Annex  II of the Anti -Dumping  Agreement  "led to an anti -dumping duty that was imposed and 
collected in excess of the margin of dumping in violation of Articles  1, 9.3, and 18.1 of the 
Anti-Dumping  Agreement ".253 According to Korea, because the margi n of dumping was determined 
based on facts available in a manner inconsistent with Article  6.8 and Annex  II, "the imposition of 
duties at the level of the margin of dumping automatically violated Article  9.3".254 Moreover, Korea 
asserts that the violation o f Article  6.8 and Annex  II also "automatically leads" to a violation of 
Articles  1 and 18.1 of the Anti -Dumping  Agreement , as "this USDOC investigation and the measure 
taken were not in accordance with the Anti -Dumping  Agreement ".255  
The United  States  responds that Korea 's claims under Articles  1, 9.3 , and 18.1 are "entirely 
consequential" and "Korea offers no argument or evidence to support any independent breach of 
those provisions".256 According to the United  States , were the Panel to uphold Korea 's claims under 
Article  6.8 and Annex  II, "there would be no basis to decide Korea 's consequential claims".257 First, 
the United  States  "does not concede that such breaches are 'automatic'".258 Second, the 
United  States  submits that deciding such claims would b e serve "no useful purpose" and would 
provide no "additional guidance that would be useful regarding implementation of any 
recommendations adopted by the DSB".259 
Korea does not present any independent bases for the alleged breaches of Articles  1, 9.3, 
and 18.1 of the Anti -Dumping  Agreement ; instead, its claims under these provisions  are dependent 
entirely upon a finding that the United  States  acted inconsistently with Article  6.8 and Annex  II of 
the Anti -Dumping  Agreement .260 In these circumstances – and hav ing already found that the 
United  States  acted inconsistently with Article  6.8 and paragraph  1 of Annex  II – we do not consider 
it necessary to rule upon Korea 's claims under Articles  1, 9.3, and 18.1  of the 
Anti-Dumping  Agreement  in order to resolve the dispute before us.261 
7.3.2   Anti-dumping duties on certain cold -rolled steel flat products from Korea 
(USDOC  investigation number A -580-881)  
Introduction  
Korea claims that the United  States  acted inconsistently with Article  6.8 and Annex  II to the 
Anti-Dumping  Agreement  in the investigation concerning certain cold -rolled steel (CRS ) flat products 
from Korea ("CRS AD investigation").262 Specifically, Korea challenges the USDOC 's use of facts 
available in respect of two issues : the alleged fa ilure of Hyundai Steel to demonstrate the 
 
252 We recall that Articles  3.4 and 3.7 of the DSU provide that that the aim of WTO dispute settlement is 
to secure a positive solution to a dispute and achieve a satisfa ctory settlement of the matter. The 
Appellate  Body has explained that the principle of judicial economy "allows a panel to refrain from making 
multiple findings that the same measure is inconsistent with various provisions when a single, or a certain 
numbe r of findings of inconsistency, would suffice to resolve the dispute". (Appellate  Body Reports, Argentina  – 
Import Measures , para.  5.190 (referring to Appellate  Body Report, Canada – Wheat Exports and Grain Imports , 
para. 133)). Past panels have also found  that, where an investigating authority errs in its resort to facts 
available, it is not necessary to address claims concerning the selection of replacement facts in order to provide 
a positive resolve the dispute. (See, e.g. Panel Reports, Egypt – Steel R ebar, para.  7.310; and Mexico  – 
Anti-Dumping Measures on Rice , para.  7.200. See also Panel Report, China – Broiler Products , para. 7.555).  
253 Korea's  first written submission, para.  206. 
254 Korea's  first written submission, paras.  203-204. 
255 Korea's  first written submission, para.  205. 
256 United  States'  first written submission, para.  356. 
257 United  States'  first written submission, para.  358. 
258 United  States'  first written submission, para.  358. 
259 United  States'  first written submission, paras . 358-359. 
260 Korea's  first written submission, paras.  204-205. 
261 See, e.g. Panel Reports, US – Differential Pricing Methodology , paras.  7.114 -7.115; Argentina – 
Poultry Anti -Dumping Duties , para.  7.369;  US – Steel Plate , para.  7.103; and EU – Footwear (Chi na), 
para. 7.935.  
262 Korea's  first written submission, para.  207. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  arm's -length nature of certain services provided by its affiliate [[***]] ("affiliated party 
transactions"); and the alleged misreporting of some products under the relevant control numbers 
(CONNUMs ) for certain ho me-market and US sales.263  
We first examine the issue of Hyundai Steel 's affiliated party transactions.  We begin by setting 
out the relevant factual background of the underlying investigation. Subsequently, we summarize 
the parties ' arguments before examin ing Korea 's claims of WTO -inconsistency in respect of the 
USDOC 's resort to facts available and its selection of the replacement facts. We then follow the same 
order of analysis for the second issue raised by Korea concerning the alleged misreporting of 
certain  CONNUMs.  
Affiliated party transactions  
7.3.2.2.1   Factual background  
In response to Section  A of the USDOC 's initial questionnaire264, Hyundai Steel identified 
[[***]] as its affiliate and reported that Hyundai Steel and [[***]] were members of the Hyundai 
Motor Group , and that they were under "common control".265 In its response to Section  B of the 
initial questionnaire (dedicated to sales in the home market or in a thi rd country), Hyundai  Steel 
stated that it used only its affiliate, [[***]], to transport merchandise to the customer266, and 
provided [[***]] financial statements in order to demonstrate that Hyundai  Steel's transactions  with 
its affiliate for inland freigh t were made for profit and, therefore, were on an arm 's-length basis.267 
In its Section  C response (dedicated to sales to the United  States ), Hyundai Steel stated that during 
the period of investigation (POI) , the inland freight to port of exportation  was h andled by [[***]], 
and referred to its Section  B response that the transactions were at arm 's length since [[***]] 
earned a profit during the POI.268 For international freight , Hyundai Steel stated that during the POI, 
[[***]] provided all shipping services to the United  States269 and provided an international freight 
contract it had with [[***]], as well as an international freight contract between [[***]] and one of 
its unaffi liated subcontractors.270  
The USDOC subsequently issued a supplemental Sections  B-C questionnaire, noting that in 
its initial questionnaire response, Hyundai Steel "never explained why the transactions between 
Hyundai Steel and [[***]] for inland freight a nd warehousing are at arm's  length".271 The USDOC 
thus requested "all [] contracts with [[***]] and all unaffiliated freight providers that cover the full 
POI [ sic]".272 Furthermore, the USDOC identified certain deficiencies with [[***]] financial 
statements  submitted by Hyundai Steel in its initial response.273 Hyundai Steel responded that 
[[***]] maintained subcontracts with over 30 subcontractors, and provided a sample contract of 
[[***]] with its one of its unaffiliated subcontractors, namely, [[***]], which, in comparison to the 
contract between Hyundai Steel and [[***]], allegedly demonstrated that [[***]] charged 
Hyundai  Steel a price higher than what [[***]] paid to its subcontractor.274  
Regarding inland freight for US sales , the USDOC 's supplemental questionnaire requested 
"copies of all freight contracts with [[***]] and all unaffiliated freight providers that cover the full 
POI".275 The USDOC also requested Hyundai Steel to provide " [[***]] inland freight prices to its 
other customers, unaffiliated to Hyundai Steel" along with "supporting evidence [of] how th[ese] 
prices are comparable to the services provided to Hyundai Steel".276 Hyundai Steel provided 
 
263 Korea's  first written submission, para.  219. 
264 CRS initial questionnaire, (Exhibit  KOR-33), p.  1. 
265 CRS Section  A questionnaire response, (Exhibit  KOR-28 (BCI)), pp.  A-10-A-12 and exhibit  A-6. 
266 CRS Section B questionnaire response, (Exhibit  KOR-36 (BCI)), pp.  B-30-B-31. 
267 CRS Section B questionnaire response, (Exhibit  KOR-36 (BCI)), p.  B-31 and exhibit  B-15. 
268 CRS Section  C questionnaire response, (Exhibit  KOR-51 (BCI)), p.  C-27. 
269 CRS Section  C questionnaire response, (Exhibit  KOR-51 (BCI)), p.  C-29 and exhibit  C-10. 
270 CRS Section  C questionnaire response, (Exhibit  KOR-51 (BCI)), pp.  C-29-C-30 and exhi bit C-10. 
271 CRS supplemental Sections B -C questionnaire,  (Exhibit  USA-72 (BCI)), p.  3.  
272 CRS supplemental Sections B -C questionnaire,  (Exhibit  USA-72 (BCI)), pp.  3-4. 
273 CRS supplemental Sections B -C questionnaire,  (Exhibit  USA-72 (BCI)), pp.  6-7. 
274 CRS su pplemental Sections B -C questionnaire response,  (Exhibit  KOR-34 (BCI)), pp.  6-11 and 
exhibits  S-6 and  S-7.  
275 CRS supplemental Sections B -C questionnaire,  (Exhibit  USA-72 (BCI)), p.  8. 
276 CRS supplemental Sections B -C questionnaire,  (Exhibit  USA-72 (BCI)), p. 8. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  contracts of [[***]] with its o ne of its unaffiliated subcontractors, [[***]]277, and stated that [[***]] 
did not provide comparable services to unaffiliated customers.278 For international freight , the 
USDOC requested "copies of all international freight contracts between  [[***]] and its unaffiliated 
customers".279 Additionally, the USDOC requested "[i]f [at] all possible, [] a price quote from [[***]] 
sub-contractor to another customer showing the arm's -length transaction comparisons between 
Hyundai Steel and [[***]], and [[***]] and its sub -contractor".280 Hyundai Steel responded that 
[[***]] did not maintain any contracts with unaffiliated customers for shipments to the 
United  States , and that while " [[***]] does provide shipping services to unaffiliated customers for 
shipments to  third countries, [[***]] has declined Hyundai Steel 's request to provide its contracts 
with unaffiliated third parties citing the proprietary and confidential nature of its transactions with 
other parties".281 In respect of the USDOC 's second request, Hyun dai Steel responded that since 
[[***]] subcontractor is not affiliated with Hyundai  Steel or [[***]], Hyundai Steel was not in a 
position to "compel" the subcontractor to provide its price quotes to another customer.282  
The USDOC followed up with a second supplemental Sections  B-C questionnaire to 
Hyundai  Steel, wherein it requested for inland freight services "copies of all contracts that [[***]] 
has with all unaffiliated parties for similar services that covers the POI".283 Hyundai Steel responded 
that for  inland freight services to warehouse, [[***]] did not offer similar services to unaffiliated 
parties, so it was unable to provide such contracts.284 Furthermore, the USDOC asked for 
[[***]] additional sample contracts between [[***]] and its subcontractors for both warehousing  
and inland freight .285 Hyundai Steel provided the [[***]] contracts with different subcontractors, 
clarifying that there were no separate contracts for warehousing.286 Finally, during verification, in 
relation to international and inland freight,  the USDOC requested "all copies of contracts that [[***]] 
has with all unaffiliated parties for similar services that cover the POI, regardless of the unaffiliated 
parties ' location".287 Hyundai Steel responded that it could not obtain the requested information due 
to the absence of direct ownership of [[***]].288 
In its ve rification report, the USDOC explained Hyundai Steel 's relationship with [[***]] and 
why Hyundai Steel should have been able to obtain the requested contracts between [[***]] and 
unaffiliated parties.289 Specifically, the USDOC indicated that , given Hyundai  Steel's inability  to 
obtain the requested information, the USDOC sought  a list of [[***]] shareholders.290 In examining 
this list, the USDOC observed, – and Hyundai Steel confirmed  – that [[***]], listed as the majority 
holder of [[***]], was the same person as Hyundai  Steel's Vice Chairman, spelled [[***]] in the 
initial response.291 Similarly, a major shareholder of [[***]], [[***]], was again confirmed by 
Hyundai Steel as referring to the person  spelled as [[***]] in the initial response, who was also 
confirmed to be the father of [[***]].292 On this basis, the USDOC reiterated its request for the 
aforementioned documents, and asked "how, given the fact that [[***]], along with his father 
[[***]], possessed the largest ownership shares in [[***]] at the same time [[***]] was 
Vice Chairman of Hyundai Steel, and while his father [[***]] was both a direct and indirect owner 
of Hyundai Steel, could Hyundai Steel not obtain the requested information fro m [[***]]".293 
Hyundai Steel again responded that it did not have direct control over [[***]].294  
In its final determination, the USDOC noted that when it "specifically requested that 
Hyundai  Steel obtain certain freight information between its affiliate an d other unaffiliated parties, 
 
277 CRS supplemental Sections B -C questionnaire response,  (Exhibit  KOR-34 (BCI)), pp.  20-21. 
278 CRS supplemental Sections B -C questionnaire response,  (Exhibit  KOR-34 (BCI)), p.  21. 
279 CRS supplemental Sections B -C questionnaire,  (Exhibit  USA-72 (BCI)), p.  9. 
280 CRS supplemental Sections B -C questionnaire,  (Exhibit  USA-72 (BCI)), p.  9. 
281 CRS supplemental Sections B -C questionnaire response,  (Exhibit  KOR-34 (BCI)), p.  24. 
282 CRS supplemental Sections B -C questionnaire response,  (Exhibit  KOR-34 (BCI)) , p. 24. 
283 CRS supplemental Sections B -C questionnaire,  (Exhibit  USA-15 (BCI)), question 3.  
284 CRS second supplemental Sections B -C questionnaire response,  (Exhibit  KOR-37 (BCI)), p.  2. 
285 CRS supplemental Sections B -C questionnaire,  (Exhibit  USA-15 (BCI)), question 5(B).  
286 CRS second supplemental Sections B -C questionnaire response,  (Exhibit  KOR-37 (BCI)), p.  5 and 
exhibits  8 and 9.  
287 CRS CEP verification report,  (Exhibit  KOR-47 (BCI)), p.  42. 
288 CRS CEP verification report,  (Exhibit  KOR-47 (BCI)), p.  43. 
289 CRS CEP verification report,  (Exhibit  KOR-47 (BCI)), p.  43. 
290 CRS CEP verification report,  (Exhibit  KOR-47 (BCI)), p.  43. 
291 CRS CEP verification report,  (Exhibit  KOR-47 (BCI)), p.  43. 
292 CRS CEP  verification report,  (Exhibit  KOR-47 (BCI)), p.  43. 
293 CRS CEP verification report,  (Exhibit  KOR-47 (BCI)), p.  44. 
294 CRS CEP verification report,  (Exhibit  KOR-47 (BCI)), p.  44. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  Hyundai  Steel stated that its affiliated company refused to provide the data".295 The USDOC stated 
that it was able to confirm that one of Hyundai  Steel's affiliated freight providers  [i.e. [[***]] 
two largest shareholders is also a part owner of Hyundai Steel and that the other large shareholder 
is the Vice Chairman of Hyundai Steel.296 The USDOC also noted these two individuals to be father 
and son, respectively.297 The USDOC thus confirmed that Hyundai Steel an d [[***]] were held and 
commonly controlled by the same family members during the POI.298 Next, the USDOC found that 
"Hyundai Steel failed to demonstrate the arm's -length nature of these services provided by the 
affiliated company [i.e. [[***]] and its U.S.  subsidiaries " and it was thus unable to determine the 
arm's -length nature of the transactions between Hyundai Steel and [[***]].299 For these reasons, 
the USDOC stated that it was "relying on facts otherwise available".300 Furthermore, "because 
Hyundai Stee l failed to provide the requested information or fully cooperate with the request for this 
information", the USDOC decided to apply an "adverse inference".301 
The USDOC applied "adverse facts available" to Hyundai Steel 's "home market inland freight, 
home m arket warehousing expenses, international freight, and U.S. inland freight".302 For home 
market inland freight and warehousing, the USDOC selected "Hyundai Steel 's lowest reported value 
for its home inland freight and warehousing fields".303 For international freight and US inland freight, 
the USDOC selected "the highest reported values by destination for Hyundai  Steel's international 
freight and U.S. inland freight".304 For home market inland freight for US sales, the USDOC "selected 
second -highest transaction -specific value as AFA".305 
7.3.2.2.2   Main a rguments of the parties  
Korea claims that the USDOC resorted to the use of facts available inconsistently with 
Article  6.8 of  the Anti -Dumping  Agreement  because no "necessary" information was missing306 and 
because Hyundai Steel did not "significantly impede []" the investigation.307 Korea asserts that the 
USDOC improperly resorted to facts available because Hyundai  Steel provided specific information 
demonstrating that [[***]] made a reasonable profit in the services it provided to Hyundai Steel, 
passing the full cost incurred by its subcontractors to Hyundai Steel, plus an amount covering its 
expenses and profit.308 The fact that the USDOC may have requested "additional information" 
(i.e. [[***]] contracts with unaffiliated customers ) in order to confirm the arm's -length nature of 
transactions does not render this information "necessary".309 Stressing that [[***]] did not maintain 
unaffiliated third -party contracts for US -destined international freight – which were among the 
information requested – Korea argues that information that is requested but does not exist cannot 
logically constitute "necessary" information.310 Korea also submits that Hyundai Steel did not 
"refuse [] access" to this information within the meaning of Article  6.8 as it attempted to obtain 
[[***]] prices to its unaffiliated customers, but [[***]] declined this request "citi ng the proprietary 
and confidential nature of its transactions with other parties".311 Korea argues that the 
 
295 CRS issues and decision memorandum,  (Exhibit  KOR-41), p.  73. (fn omitted; emphasis added)  
296 CRS issues and decision memorandum,  (Exhibit  KOR-41), pp.  73-74. 
297 CRS issues and decision memorandum,  (Exhibit  KOR-41), p.  74. 
298 CRS issues and decision memorandum,  (Exhibit  KOR-41), p.  74. 
299 CRS issues and decision memorand um, (Exhibit  KOR-41), p.  74. 
300 CRS issues and decision memorandum,  (Exhibit  KOR-41), p.  74. 
301 CRS issues and decision memorandum,  (Exhibit  KOR-41), p.  74. 
302 CRS issues and decision memorandum,  (Exhibit  KOR-41), p.  74. 
303 CRS issues and decision memorandum,  (Exhibit  KOR-41), p.  74. 
304 CRS issues and decision memorandum,  (Exhibit  KOR-41), p.  74. 
305 CRS issues and decision memorandum,  (Exhibit  KOR-41), p.  74. 
306 Korea's  first written submission, para.  258. 
307 Korea's  first written submission, para.  269. 
308 According  to Korea, the information provided by Hyundai Steel demonstrated that  (a) "[[***]] made 
a reasonable profit on the services it provided to Hyundai Steel"; and (b)  "when [[ ***]] subcontracted an 
unaffiliated party for the services, it paid and passed the f ull cost incurred by the unaffiliated -service -provider 
to Hyundai Steel, plus an amount to cover its expenses and profit".  
(Korea's  first written submission, paras.  223 and 258).  
309 Korea's  first written submission, paras.  262-263. 
310 Korea's  first written  submission, para.  264. 
311 Korea's  second written submission, para.  72 (quoting CRS supplemental Sections B -C questionnaire 
response,  (Exhibit  KOR-34 (BCI)) , p. 24; and referring to CRS verification report, (Exhibit  KOR-35 (BCI)) , 
pp. 43-44); first written submission, para.  223. Korea explains that Hyundai Steel was not in a position to 
compel [[ ***]] to provide this information as a consequence of these entities being "legally separate", and 
because the management of [[ ***]] has a number of fiduciar y duties under Korean law not to disclose 
 WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 52 - 
 
  USDOC 's focus on the affiliation between Hyundai Steel and [[***]] is "misplaced", since it was fully 
identified and explained in the questionnaire responses.312 
Korea further claims that the USDOC acted inconsistently with paragraph  1 of Annex  II 
because it failed to specify in detail the required information as soon as possible after the initiation 
of the investigation.313 Korea contends that the USDO C expressly requested for the first time during 
verification "all copies of contracts that [[***]] has with all unaffiliated parties for similar services 
that cover the POI, regardless of the unaffiliated parties ' location".314 Korea claims that the USDOC 
also acted inconsistently with paragraph  6 of Annex  II because it did not explain why the other 
information submitted by Hyundai Steel was rejected and because it did not provide a reasonable 
time to Hyundai Steel to submit further explanations after seeking the aforementioned contracts at 
verification.315 Korea also claims that the United  States  acted inconsistently with paragraphs 3 and 
5 of Annex  II because the USDOC disregarded information that, even if not ideal in all aspects, was 
not only verifia ble but also verified and was submitted appropriately, and in a timely fashion.316 
According to Korea, the USDOC rejected the submitted information "in favor of an unsubstantiated 
assumption contradicted by other evidence".317  
As to the selection of the rep lacement facts, Korea claims that the USDOC acted inconsistently 
with Article  6.8 and  paragraph  7 of Annex  II of the Anti -Dumping  Agreement  because there was no 
process of reasoning and evaluation by the USDOC as to how or why the facts employed by the 
USDOC were reasonable replacements for the missing information.318 Korea contends that, instead 
of selecting a reasonable replacement for the missing information319, the USDOC rejected all 
information submitted by Hyundai Steel and "asymmetrically applied AFA",  with no supporting 
explanation and irrespective of Hyundai Steel 's actual circumstances, in order to increase the normal 
value by using the lowest reported expense values to the entire home -market database and decrease 
the export price by using the highes t reported values to the US database.320 Korea argues that the 
USDOC 's selection of facts was punitive in nature321, and "based on nothing but non -factual 
assumptions and speculation".322 Korea contends that the USDOC could have adjusted the 
transaction value s found not to be at arm 's length based on Hyundai  Steel's verified service 
expenses (that were verified and found to be arm's -length transactions  in the preliminary 
determination).323 However, the USDOC used aberrational data that did not relate to the fac tual 
circumstances of all of Hyundai Steel 's sales.324 Korea also argues that the USDOC did not exercise 
special circumspection.325  
The United  States  responds that Korea has not demonstrated that the information at issue 
was not "necessary" and highlights that the determination of whether certain information is 
"necessary" lies solely with the investigating authority.326 According to the United States, the USDOC 
reasonably determined that it "did not have enough information on the record to establish" the 
arm's -length nature of the transactions at stake.327 Given Hyundai Steel 's response that it had not 
 
confidential information. (Korea's  second written submission, para.  82. See also Korea's  response to Panel 
question No.  15). 
312 Korea's  first written submission, para.  260. 
313 Korea's  first written submission, para.  265. 
314 Korea's  first written submission, para.  265 (referring to CRS verification report, (Exhibit  KOR-35 
(BCI)), p.  42). See also CRS supplemental Sections B -C questio nnaire,  (Exhibit  USA-15 (BCI)), question 3. 
Korea clarifies that although the USDOC had posed a general request for this information before verification, it 
had previously not indicated that the copies of these contracts with third parties, even for sales to countries 
other than the United  States, constituted "necessary" information. ( Korea's  first written submission, 
paras.  266 and 271; response to Panel question No.  10(b)).  
315 Korea's  first written submission, para.  271. 
316 Korea's  first written submission,  paras.  285-287. 
317 Korea's  first written submission, para.  294. 
318 Korea's  first written submission, paras.  310 and 312. See also second written submission, para.  74. 
319 Korea's  second written submission, paras.  106-107. 
320 Korea's  first written submission, p aras. 310 and 316.  
321 Korea's  first written submission, para.  313. 
322 Korea's  first written submission, para.  294. 
323 Korea's  first written submission, para.  313. 
324 Korea's  first written submission, para.  317. See also Korea's  second written submission, 
paras. 108-109. 
325 Korea's  first written submission, para.  318. 
326 United  States'  second written submission, para.  54. 
327 United  States'  first written submission, para.  150. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 53 - 
 
  engaged in transactions with unaffiliated providers during the POI, the contracts between [[***]] 
and its unaffiliated customers were the only information capable of demonstrating the arm's -length 
nature of the transactions.328 The United  States  explains that copies of [[***]] contracts with 
unaffiliated pur chasers, irrespective of their location, were necessary for the USDOC 's determination 
because the prices presented in those contracts would likely represent market prices and, by 
comparison, it could be determined whether the services provided to Hyundai S teel were at 
arm's length.329 
As to Korea 's argument that Hyundai Steel did not have access to the requested information, 
the United  States  responds that the "legal separation" between Hyundai Steel and [[***]] is not the 
issue, but, instead, the issue is w hether "the two legally distinct companies are affiliated".330 The 
United  States  submits that [[***]], like Hyundai Steel, is a member of the "Hyundai Motor Group", 
which has the ability to "directly or indirectly control " its group members , and thus Hyundai Steel 
should have been able to respond fully to the USDOC 's requests for information and to provide the 
affiliate 's contracts and transaction details.331 The United  States  further argues that Korea makes a 
post hoc argum ent when suggesting that Hyundai Steel could not gain access to the requested 
documents due to confidentiality and fiduciary concerns and [[***]] obligations under Korean  law, 
an argument that was never made by Hyundai Steel before the USDOC .332 
Further, the United  States  responds that the USDOC indicated early on in the investigation 
that information relating to the transactions between Hyundai Steel and its affiliates would be 
required.333 The number of times Hyundai  Steel was asked to provide in formation relating to the 
transactions with its affiliates "belies" its claims that it was not allowed a reasonable period of time 
to provide the information, and that it was not asked for such information as soon as possible after 
initiation.334 The United  States  rejects Korea 's characterization of the USDOC 's request as 
"expansive" or "sudden", on the basis that the USDOC had clarified in its verification outline that it 
may ask questions relating to any part of Hyundai  Steel's responses, including those r elating to the 
affiliated service provider, in order to bolster the accuracy of its calculations.335 The United  States  
submits that Korea has thus failed to demonstrate that the USDOC acted inconsistently with 
paragraphs 1 and 6 of Annex  II.  
With respect t o Korea 's claim under paragraph  3 of Annex  II, the United  States  responds 
that in the absence of the requested documents, the USDOC did not have the opportunity to examine 
the accuracy and reliability of the information submitted, and to verify whether the  affiliated 
parties ' transactions were at arm 's length.336 In addition, the United  States  argues that since the 
information submitted by Hyundai Steel did not satisfy the conditions of paragraph  3, it falls outside 
the ambit of paragraph  5, but even if the Panel were to conduct an assessment under paragraph  5, 
Hyundai Steel did not act to the best of its ability by failing to submit the requested information , 
despite multiple opportunities.337 
According to t he United  States , the record shows the USDOC engaged in a careful 
assessment of the missing necessary information and reasonably decided to rely on Hyundai 
Steel's own reported data.338 The United  States  highlights that  Korea has not explained why the 
USDOC 's process for selecting the replacement facts is inconsistent with any specific provision of the 
Anti-Dumping  Agreement , apart from its dis satisfaction with the data selected.339 The United  States  
explains that the USDOC did not reject all of Hyundai Steel 's expense data – as argued by Korea  – 
but disregarded only certain information relating to Hyundai Steel 's affiliated service providers and  
replaced those missing values with other expense values reported by Hyundai Steel.340 
 
328 United  States'  second written submission, para.  49. 
329 United  States'  response to Panel question No.  14, para.  59. 
330 United  States first written submission, para. 156.  
331 United  States'  first written submission, paras.  156-157 (quoting CRS issues and decision 
memorandum,  (Exhibit  KOR-41), p.  74). 
332 United  States'  second written submission, paras.  57-58. 
333 United  States'  first written submission, para.  153. 
334 United  States'  first written submission, para.  155. 
335 United  States'  first written submission, paras.  158-160. 
336 United  States'  first written s ubmission, para.  172. 
337 United  States'  first written submission, para.  176. 
338 United  States'  first written submission, para.  183. 
339 United  States'  first written submission, para.  184. 
340 United  States'  first written submission, para.  187. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 54 - 
 
  Korea 's characterization of the replacements as arbitrary and punitive is, according to the 
United  States , "meritless ".341 Finally, the United  States  asserts that Korea 's claim that that the 
USDOC did not use special circumspection fails , as Korea  does not explain its arguments.342 
7.3.2.2.3   Evaluation by the Panel  
7.3.2.2.3.1   The USDOC 's resort to facts available  
Korea claims that the USDOC acted inconsistently with Article  6.8 and paragraphs 1, 3, 5, 
and 6 of Annex  II of the Anti -Dumping  Agreement  in resorting to the use of facts available in respect 
of Hyundai Steel 's reporting of affiliated party transactions.  
Noting the "important distinction between requested information and necessary 
information", Korea submits that the information ultimately "requested" by the USDOC in the case 
at hand (i.e.  contracts of [[***]] with unaffiliated providers ) was not "necessary " within the meaning 
of Article  6.8.343 Specifically, Korea explains that "[t]he relevant U.S. law, as corroborated by 
relevant practice, imposes an obligation on the USDOC to ensure that the cost of various expenses 
used in the margin calculation, such as transportation expenses, reflect market value" .344 Korea 
contends that the USDOC 's questionnaire reflects a clear "order of preference for the requested 
information concerning the respondent 's affiliated -company transactions".345 According to Korea :  
[T]he U SDOC 's questionnaire directed Hyundai Steel to (i ) calculate market value by 
using purchases of the inputs or services in question from unaffiliated parties during the 
same period; and if there are no such purchases  but the affiliated supplier sells the 
identical input to unaffiliated customers in the relevant market, (ii ) provide the average 
price paid for the input or service by the unaffiliated purchasers. If Hyundai Steel is 
unable to obtain  a market value for the input, the questionnaire instructed to provide 
(iii) the "product -specific" unit cost of production to demonstrate the arm's -length 
nature of the transactions.346 
For Korea, "[i]t is thus difficult to understand how Hyundai Steel 's reporting of its 
affiliated -company transactions in accordance with the order provided by the questionnaire can 
somehow circle back to constitute a total failure to provide the requested information" .347 In other 
words, because the USDOC 's questionnaire itself envisages reliance on different kinds of informa tion 
to demonstrate the arm's -length nature of affiliate -party transactions, Korea argues that a 
respondent 's inability to provide any one  of the three  kinds of information cannot ipso facto 
constitute a failure to provide "necessary" information within th e meaning of Article  6.8.  
The United  States  acknowledges that the USDOC 's "Section  D questionnaire provided 
Hyundai  Steel with three alternatives for providing necessary information relating to 
Hyundai  Steel's purchases of 'major inputs'".348 However, acco rding to the United  States , the 
USDOC 's "three -part methodology" in its Section  D questionnaire for "major inputs" was "not 
applicable to the inputs at issue such as freight and warehousing services" as they are "not major 
inputs".349 Rather, for these transactions, the inquiry involved "a comparison between the transfer 
price between the purchaser (respondent ) and its affiliates supplier with a market price for the 
input".350 The United  States  submits that, "[i]n this case, the respond ent did not provide the data 
needed to test whether the transactions were made at arm 's length", and "[a]ccordingly … necessary 
information for conducting the analysis" was "not on the record".351 
 
341 United  States'  first written submission, para.  190. 
342 United  States'  first written submission, para.  191. 
343 Korea's  first written submission, para.  263. 
344 Korea's  first written submission, para.  222. 
345 Korea's  first written submission, para.  261. 
346 Korea' s first written submission, para.  222 (emphasis added). See also Korea's  comments on 
United  States'  response to Panel question No.  66(a), pp.  40-41. 
347 Korea's  first written submission, para.  261. 
348 United  States'  response to Panel question No.  66(a), para.  69.  
349 United  States'  response to Panel question No.  66(b), para.  73. 
350 United  States'  response to Panel question No.  66(b), para.  73. 
351 United  States'  response to Panel question No.  66(b), para.  73. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 55 - 
 
  
The USDOC in its  initial questionnaire requested Hyundai Ste el to "[p]repare only a single 
response for [itself and its] affiliates  involved with the production or sale of the products under 
investigation during the period of investigation  (POI) in the foreign market or the United  States ".352 
The initial questionnaire comprised of five sections, labelled A through E. Under Section  D – entitled 
"[c]ost of [p]roduction and [c]onstructed [v]alue" – the USDOC requested Hyundai Steel to 
"identify", among other items, those inputs that it received f rom affiliated parties and indicate 
"whether the transfer price of the good or service [i.e. the inputs] reflects the market price of the 
item, in the market under consideration".353  
With respect to " major inputs  purchased from affiliated parties that are used to produce the 
merchandise under consideration", the USDOC requested Hyundai Steel to provide "the average unit 
market value per unaffiliated supplier(s)".354 "If there are no such purchases"  but an "affiliated 
supplier sells the identical input to una ffiliated customers in the market under consideration", the 
USDOC asked for the "average price paid for the input by the unaffiliated purchasers".355 Finally, in 
cases that Hyundai Steel is "unable to obtain a market value for the input", the USDOC asked fo r 
"the product specific per -unit cost of production incurred by each affiliated supplier producing the 
major input".356  
While we agree with Korea that this set of questions contemplates an "order of preference" 
for different kinds of information requested by the USDOC depending upon the circumstances, we 
note that these questions are posed expressly with respect to "major inputs". Nowhere in its 
Section  D response does Hyundai Steel identify the inputs supplied by its affiliate [[***]] that are 
at issue in these panel proceedings as "major inputs". Instead, based upon "a summary of its 
purchases of all inputs from affiliated suppliers"  – including [[***]] – Hyundai Steel s tated that "all 
inputs sourced from affiliated parties constitute a tiny portion of the  cost of manufacturing".357 We 
therefore  agree with the United  States  that the "order of preference" or the "three -part 
methodology" reflected in the USDOC 's Section  D questionnaire for "major inputs" is of limited 
relevance for "the inputs at issue such as  freight and warehousing services" as they are "not major 
inputs ".358 Accordingly, we  reject Korea 's argument that the "requested" information was not 
"necessary" within the meaning of Article  6.8 as the USDOC 's own questionnaire contemplated an 
"order of preference".  
Having determined that the Section D questionnaire contemplated an "order of preference" 
only for "major inputs", w e turn to examine the USDOC 's questions posed specifically in respect of 
the inputs  that were, in fact, supplied by Hyundai  Steel's affiliate [[***]] and form the basis for 
Korea 's claims under paragraphs 1, 3, 5, and 6 of Annex  II.  
In Section  A of its initial questionnaire – entitled " [o]rganization, [a]ccounting [p]ractices, 
[m]arkets  and [m]erchandise"  – the USDOC inquired about the corporate and legal structure of 
Hyundai Steel and asked it to identify "all other persons affiliated with [the] company and provide a 
description of all such persons".359 In response, Hyundai Steel identif ied [[***]] as its affiliate and 
reported that [[***]].360 As to the "operational relationship" that Hyundai Steel had with other 
members of the Hyundai Motor Group, Hyundai Steel explained "that there is common control of the 
 
352 CRS initial questionnaire, (Exhibit  KOR-33), p.  G-10. (emphasis original)  
353 CRS initial questionnaire, (Exhibit  KOR-33), pp.  D-3-D-4. 
354 CRS initial questionnaire, (Exhibit  KOR-33), p.  D-4. (emphasis added)  
355 CRS initial questionnaire, (Exhibit  KOR-33), p.  D-4.  
356 CRS initial questionnaire, (Exhibit  KOR-33), p. D-5. (emphasis original; fn  omitted)  
357 CRS part I of Section D questionnaire response, (Exhibit  USA-14 (BCI)), p.  D-7. 
358 United  States'  response to Panel question No.  66(b), para.  73. 
359 CRS initial questionnaire, (Exhibit  KOR-33), p.  A-4. The USDOC's  questionnaire provides the 
following definition of "affiliated persons":  
The term affiliated persons (affiliates)  includes:  (1) members of a family; (2)  an officer or director 
of an organization and that organization; (3)  partners; (4)  employers an d employees; (5)  any 
person directly or indirectly owning, controlling, or holding with power to vote, 5 percent or more 
of the outstanding voting stock or shares of any organization and that organization; (6)  two or 
more persons directly or indirectly con trolling, controlled by, or under common control with, any 
person; and (7)  any person who controls any other person and that other person. Control exists 
when a person is legally or operationally in a position to exercise restraint or direction over anothe r 
person. A control relationship should also have the potential to affect decisions concerning the 
production, pricing, or cost of the merchandise under investigation or review.  
(CRS initial questionnaire, (Exhibit  KOR-33), p.  I-1) 
360 CRS Section  A question naire response, (Exhibit  KOR-28 (BCI)), p.  A-12. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 56 - 
 
  Hyundai Motor Group through it s chairman, [[***]]".361 With respect to its affiliate [[***]], Hyundai 
Steel further explained that, "[d]uring the POI, [[***]]".362 Hyundai Steel stated that it would 
"demonstrate in its forthcoming Sections  B and C responses that transactions with affilia ted service 
providers are at arm 's length".363 
Section  B of the USDOC 's questionnaire concerned "[s]ales in the [h]ome [m]arket or to a 
[t]hird [c]ountry"364, while Section  C required information concerning "[s]ales to the 
United  States ".365 Under Section  B – for home market sales – the USDOC asked Hyundai Steel to 
report certain "movement expenses", including those incurred for "inland freight" from "[p]lant to 
[d]istribution [w]arehouse"366, "warehousing"367, and "inland freight" from "[p]lant/[w] arehouse to 
[c]ustomer".368 The USDOC 's instructions required Hyundai Steel to also identify any "affiliations" 
with the service providers and to "describe the nature of the affiliation".369 Hyundai Steel stated  
that, for inland freight from plant to warehou se, it "used an affiliated freight company, [[***]] to 
transport" "some finished coils to offsite warehouses prior to shipment to the customer".370 Hyundai 
Steel stated that it would demonstrate that "the rates paid to this company represent arm 's length 
prices" as part of its response concerning "inland freight to the customer".371 In respect of 
warehousing expenses, Hyundai Steel responded that "in some instances" it "used offsite warehouse 
facilities close to its factory to temporarily store finished subject products prior to shipment to the 
final customer".372 Providing "a list of  the off -site warehousing locations", Hyundai  Steel explained 
that:  
These warehousing locations are owned by unaffiliated parties, but the warehousing 
services at most of these facilities are provided by [[***]] and Hyundai Steel pays 
[[***]] for these wa rehousing services. [[***]] contracts with the unaffiliated 
warehouse providers and in turn pays them for warehousing. … With respect to one 
warehousing location, [[***]], this facility is managed by an unaffiliated provider and 
Hyundai Steel transacts dir ectly with the unaffiliated company.  
… 
Hyundai Steel provides a copy of its warehousing contract with [[***]] in Exhibit  B-12, 
along with the contract for the [[***]] location, which is managed by an unaffiliated 
company, [[***]].373 
Hyundai Steel stated that it would demonstrate that the transactions with [[***]] reflect 
arm's-length prices as part of its response for inland freight to customer.374 
Finally, for inland freight from plant/warehouse to customer, Hyundai Steel explained th at it 
used its affiliate [[***]] to transport merchandise to the customer. As it did not use unaffiliated 
 
361 CRS Section  A questionnaire response, (Exhibit  KOR-28 (BCI)), p.  A-11. We note in this regard that 
the USDOC's  questionnaire defined "control" as existing "where a person is legally or operationally in a p osition 
to exercise restraint or direction over another person". (CRS initial questionnaire, (Exhibit  KOR-33), p.  A-5). 
362 CRS Section  A questionnaire response, (Exhibit  KOR-28 (BCI)), p.  A-12. 
363 CRS Section  A questionnaire response, (Exhibit  KOR-28 (BCI)),  p. A-13. The USDOC's  questionnaire 
explains that arm's -length transactions are "those in which the selling price between the affiliated parties is 
comparable to the selling prices in transactions involving persons who are not affiliated. The [USDOC] takes  
into account terms of sale, conditions of delivery, and other circumstances related to the sales in deciding if the 
selling prices are comparable". (CRS initial questionnaire, (Exhibit  KOR-33), p. I-2). 
364 CRS initial questionnaire, (Exhibit  KOR-33), p. B-1. 
365 CRS initial questionnaire, (Exhibit  KOR-33), p. C-1. The USDOC explained that it would use this 
information to "compare the prices at which this merchandise is sold in the United  States with the prices at 
which the foreign like product is sold in the foreign market in order to determine whether the subject 
merchandise was sold at less than normal value in the United  States during the [POI]". ( CRS initial 
questionnaire, (Exhibit  KOR-33), p. C-1 (emphasis omitted)).  
366 CRS initial questionnaire, (Exhibit  KOR-33), p. B-22. 
367 CRS initial questionnaire, (Exhibit  KOR-33), p. B-23. 
368 CRS initial questionnaire, (Exhibit  KOR-33), p. B-23. 
369 CRS initial questionnaire, (Exhibit  KOR-33), pp. B-22-B-23. 
370 CRS Section B questionnaire response, (Exhibit  KOR-36 (BCI)) , p. B-28. 
371 CRS Section B questionnaire response, (Exhibit  KOR-36 (BCI)) , p. B-28. 
372 CRS Section B questionnaire response, (Exhibit  KOR-36 (BCI)) , p. B-29. 
373 CRS Section B questionnaire response, (Exhibit  KOR-36 (BCI)) , p. B-29. 
374 CRS Section B questionnaire response, (Exhibit  KOR-36 (BCI)) , p. B-29. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 57 - 
 
  freight companies for similar services, Hyundai Steel was "unable to provide comparable prices from 
unaffiliated vendors for comparison".375 Thus, in o rder to establish the arm's -length nature of the 
transactions between Hyundai Steel and its affiliate [[***]], Hyundai Steel provided "calculations 
from the company 's financial statements demonstrating that the company earned a profit during the 
POI".376 "[B]ecause this company earned a profit during the POI", Hyundai Steel considered that 
"these transactions reflect arm 's length prices".377 In addition to the financial statements, 
Hyundai  Steel also provided the contracts between "Hyundai Steel and the two p roviders" (i.e. its 
affiliate [[***]] and the unaffiliated provider [[***]]) "show[ing] that these transactions are at 
arm's length ".378  
For sales to the United  States  under Section  C, Hyundai Steel reported that it "incurred 
inland freight expenses for tr ansportation of the merchandise from the factory to the port" and 
"[d]uring the POI, Hyundai Steel transported merchandise by truck using an affiliated general 
logistics company, [[***]], which is the same company it used for domestic sales".379 Hyundai  Steel 
thus referred to its reporting under Section  B for inland freight expenses as establishing that [[***]] 
"provided such services at arm 's length".380 Additionally, Hyundai Steel also reported international 
freight expenses "from the port of exit in the country of manufacture to the U.S. port of entry" and 
stated that  "[d]uring the POI, [[***]], an affiliate, provided all shipping services".381 In additi on to 
referring to its Section  B response to demonstrate the arm's -length nature of the transactions, 
Hyundai Steel also provided copies of Hyundai Steel 's international freight contract with [[***]], on 
the one hand, and [[***]] international freight cont ract with its subcontractors, on the other hand, 
to demonstrate this point.382 Specifically, Hyundai Steel provided copies of [[***]] international 
freight contracts with two subcontractors, namely, [[***]] and [[***]].383  
In summary, with respect to the re porting of movement expenses under Sections  B and C 
of the USDOC 's questionnaire, Hyundai Steel noted that many of the services at issue were provided 
by its affiliate [[***]] and offered several pieces of information to demonstrate the arm's -length 
nature  of the transactions with its affiliate [[***]]. First, Hyundai  Steel provided "financial 
statements" from [[***]] "demonstrating that the company earned a profit during the POI"384, and 
that therefore "these transactions reflect arm 's length prices".385 Second, besides its contract with 
[[***]], which provided warehousing services for home market sales at most of its facilities, Hyundai 
Steel submitted a contract with an unaffiliated provider [[***]], which provided warehousing service 
at one warehousing loc ation ( [[***]]). According to Hyundai Steel, its contracts with these 
"two providers" "show that these transactions are at 'arm 's length'".386 Finally, with respect to 
international freight for sales to the U nited States, Hyundai  Steel provided copies of 
Hyundai  Steel's international freight contract with [[***]], on the one hand, and [[***]] 
international freight contract with two subcontractor s ([[***]] and [[***]]387), on the other hand, 
to demonstrate that transactions with [[***]] were on an arm's -length basis.388  
The USDOC subsequently issued a supplemental Sections  B-C questionnaire, observing that, 
in its initial Section  B response, Hyunda i Steel "never explained why the transactions between 
Hyundai Steel and [[***]] for inland freight and warehousing are at arm's -length".389 The USDOC 
thus requested "all freight contracts with [[***]] and all unaffiliated freight providers that cover the 
full POI [ sic]".390 Furthermore, the USDOC noted that the "net profit information" provided for 
 
375 CRS Section B questionnaire response, (Exhibit  KOR-36 (BCI)) , p. B-30. 
376 CRS Section B questionnaire response, (Exhibit  KOR-36 (BCI)) , pp. B-30-B-31. 
377 CRS Section B questionnaire res ponse, (Exhibit  KOR-36 (BCI)) , p. B-31. 
378 CRS Section B questionnaire response, (Exhibit  KOR-36 (BCI)) , p. B-31. 
379 CRS Section  C questionnaire response, (Exhibit  KOR-51 (BCI)) , p. C-27. Hyundai Steel explained that 
it "did not utilize outside warehouses fo r its sales to the United  States" either in the home country or in the 
United  States and that it "did not incur any U.S. inland freight expenses during the POI for its [export price] 
sales". (CRS Section  C questionnaire response, (Exhibit  KOR-51 (BCI)) , pp. C-25-C-26 and C -30-C-32).  
380 CRS Section  C questionnaire response, (Exhibit  KOR-51 (BCI)) , p. C-27. 
381 CRS Section  C questionnaire response, (Exhibit  KOR-51 (BCI)) , p. C-29. 
382 CRS Section  C questionnaire response, (Exhibit  KOR-51 (BCI)) , p. C-30. 
383 CRS Se ction C questionnaire response, (Exhibit  KOR-51 (BCI)) , exhibit  C-10. 
384 CRS Section B questionnaire response, (Exhibit  KOR-36 (BCI)) , pp. B-30-B-31. 
385 CRS Section B questionnaire response, (Exhibit  KOR-36 (BCI)) , p. B-31. 
386 CRS Section B questionnaire resp onse, (Exhibit  KOR-36 (BCI)) , p. B-31. 
387 CRS Section  C questionnaire response, (Exhibit  KOR-51 (BCI)) , exhibit  C-10. 
388 CRS Section  C questionnaire response, (Exhibit  KOR-51 (BCI)) , p. C-30. 
389 CRS supplemental Sections B -C questionnaire, (Exhibit  USA-72 (BC I)), p.  3. 
390 CRS supplemental Sections B -C questionnaire, (Exhibit  USA-72 (BCI)), pp.  3-4. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 58 - 
 
  [[***]] does not show that it [[***]].391 The USDOC thus requested Hyundai Steel to demonstrate 
why these transactions with its affiliate [[***]] should be considered to be at arm's  length.392 
Regarding inland freight  from factory to the port for  US sales , the USDOC noted 
Hyundai  Steel's reliance on [[***]] profit margins in its initial Section  C response, but requested 
"copies of all freight contracts with [[***]] and all unaffiliated freight providers that cover the full 
POI [ sic]"393, as well as " [[***]] inland freight prices to its other custome rs, unaffiliated to 
Hyundai  Steel".394 Finally, with respect to Hyundai Steel 's reporting of its international freight 
expenses for US sales, the USDOC requested "copies of all international freight contracts between 
[[***]] and its unaffiliated customers".395 Additionally, for international freight, the USDOC 
requested "[i]f [at] all possible, [] a price quote from [[***]] sub-contractor to another customer 
showing the arm's -length transaction comparisons between Hyundai Steel and [[***]], and [[***]] 
and its sub -contractor".396 
In response to the USDOC 's supplemental queries, Hyundai  Steel explained that, for inland 
freight and warehousing for home market sales, [[***]] maintained subcontracts with over 
30 subcontractors, and provided a sample contract  of [[***]] with one such unaffiliated 
subcontractor, namely, [[***]]397, which, in comparison with the contract between Hyundai Steel 
and [[***]], allegedly demonstrated that [[***]] charged Hyundai Steel a "higher fees than it pays 
to the sub -contractor".398 In relation to inland freight for products destined for the United  States , 
Hyundai Steel responded that [[***]] had contracts with over 40 subcontractors and provided as a 
"representative sample" contracts between [[***]] and one unaffiliated subcontrac tor ([[***]]), 
explaining that these " contracts cover multiple services, such as inland freight and warehousing".399 
Hyundai Steel also stated that [[***]] did not provide comparable services to unaffiliated 
customers.400 
Finally, regarding international freight expenses for US  sales, Hyundai Steel responded that 
[[***]] did not maintain any contracts with unaffiliated customers for shipments to the 
United  States, and that while " [[***]] does provide shipping services to unaffiliated customers for 
shipments to third countries, [[***]] ha[d] declined Hyundai Steel 's request to provide its contracts 
with unaffiliated third parties citing the proprietary and conf idential nature of its transactions with 
other parties".401 In response to the USDOC 's request for "a price quote from [[***]] sub-contractor 
to another customer", "[i]f [at] all possible", Hyundai Steel responded that since [[***]] 
subcontractor is not aff iliated with Hyundai Steel or [[***]], Hyundai Steel was not in a position to 
"compel" the subcontractor to provide its "price quotes to another customer".402 
We note that, as part of its initial Section  B response for inland freight for home market 
sales, Hyundai Steel had already indicated that it did "not use unaffiliated freight companies for 
similar services" and was therefore "unable to provide comparable prices from unaffiliated vendors 
for comparison".403 Therefore, the USDOC 's request in its suppleme ntal questionnaire for "all freight 
contracts with [[***]] and all unaffiliated freight providers  that cover the full POI [ sic]"404 appears 
to overlook Hyundai Steel 's initial explanation. In any event, for both home market and US  sales, 
Hyundai Steel provi ded sample inland freight and warehousing contracts of [[***]] with one 
unaffiliated subcontractor, namely, [[***]]405, in addition to the information that was supplied as 
part of its initial response.  
We agree with the United  States  that, as part of its supplemental questionnaire, the USDOC 
took into account the [[***]] financial statements provided by Hyundai Steel in its initial response, 
 
391 CRS supplemental Sections B -C questionnaire, (Exhibit  USA-72 (BCI)), pp.  3-4. 
392 CRS supplemental Sections B -C questionnaire, (Exhibit  USA-72 (BCI)), pp.  3-4. 
393 CRS supplemental Sections B -C questionnaire, (Exhibit  USA-72 (BCI)), p.  8. 
394 CRS supplemental Sections B -C questionnaire, (Exhibit  USA-72 (BCI)), p.  8. 
395 CRS supplemental Sections B -C questionnaire, (Exhibit  USA-72 (BCI)), p.  9. 
396 CRS supplemental Sections  B-C questionnaire, (Exhibit  USA-72 (BCI)), p.  9. 
397 CRS supplemental Sections B -C questionnaire response,  (Exhibit  KOR-34 (BCI)), pp.  7 and 9 -11 and 
exhibits  S-6 and S -7. 
398 CRS supplemental Sections B -C questionnaire response,  (Exhibit  KOR-34 (BCI)), pp.  8 and 10.  
399 CRS supplemental Sections B -C questionnaire response,  (Exhibit  KOR-34 (BCI)), pp.  20-21. 
400 CRS supplemental Sections B -C questionnaire response,  (Exhibit  KOR-34 (BCI)), p.  21. 
401 CRS supplemental Sections B -C questionnaire response,  (Exhibit  KOR-34 (BCI)), p.  24. 
402 CRS supplemental Sections B -C questionnaire response,  (Exhibit  KOR-34 (BCI)), p.  24. 
403 CRS Section B questionnaire response, (Exhibit  KOR-36 (BCI)) , p. B-30. 
404 CRS supplemental Sections B -C questionnaire,  (Exhibit  USA-72 (BCI)), pp. 3-4. (emphasis added)  
405 CRS supplemental Sections B -C questionnaire response,  (Exhibit  KOR-34 (BCI)), pp.  7 and 9.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  but found that they failed to establish that the transactions between [[***]] and Hyundai Steel were 
at arm 's length because they  did not show  that [[***]] "[[***]]".406 In other words, the USDOC 
found the financial statements to be de ficient for purposes of its analysis and properly informed 
Hyundai Steel of the reasons for such deficiency through its supplemental questionnaire.  
Crucially, however, although the USDOC addressed the deficiencies in [[***]] financial 
statements, it did n ot address the other information that was submitted by Hyundai Steel as part of 
its initial response to establish the arm's -length nature of the transactions between Hyundai Steel 
and [[***]]. Unlike its discussion of the financial statements, there is not hing in the supplementary 
questionnaires to indicate that the USDOC took into account or otherwise addressed 
Hyundai  Steel's contract with an unaffiliated provider [[***]] that provided warehousing service at 
one warehousing location ( [[***]]), which allegedly showed that these transactions are at 
"arm's length".407 Nor do the supplementary questionnaires show that the USDOC took into account 
"Hyundai Steel 's international freight contract with [[***]]", on the one hand, and [[***]] 
international freight con tracts with its subcontractors ( [[***]] and [[***]]408), on the other hand. 
All of this information was submitted as part of Hyundai Steel 's initial response to show that these 
transactions were at "arm 's length".409 
We disagree with the United  States  that the "record shows that Hyundai Steel never 
presented the contract between Hyundai Steel and [[***]] to [USDOC] for the purpose of 
demonstrating that [[***]] warehousing services were provided at arm 's length" .410 In its initial 
Section  B response, Hyundai Steel provided a "copy of its warehousing contract with [[***]] … along 
with the contract for the [[***]] location, which is managed by an unaffiliated company, [[***]]" 
and clearly explained that the "contract materi als between Hyundai  Steel and the two providers 
([[***]] and the unaffiliated provider ) show that these transactions are at arm 's length" .411 In 
response to questioning by the Panel, the United  States  also submits that, in any event, "based on 
what Hyundai [Steel] reports, the costs associated with the [[***]] contract appear not to be 
comparable with the costs associated with the warehouses serviced by [[***]]".412 Even if the 
contracts were not "comparable" – as now suggested by the United  States  – what is important is 
that the USDOC did not provide any such reasoning or explanation  as part of its analysis . 
We therefore find it difficult to accept in its entirety t he United  States'  argument that the 
USDOC, after "reviewing" Hyundai Steel 's Sections  B and C initial responses, "found that the 
information Hyundai Steel submitted failed to establish that the transactions between [[***]] and 
Hyundai Steel were at arm 's length" .413 Although the supplementary Sections B -C questionnaire 
indicates  that the USDOC reviewed one of the several pieces of information provided by 
Hyundai  Steel in its initial response (i.e. [[***]] financial statements ) and found it to be deficient, 
there is no indication that the USDOC  took into account or otherwise addressed or reviewed 
Hyundai  Steel's contract with an unaffiliated supplier for warehousing services as well as [[***]] 
international freight contracts with two of its subcontractors that  were provided as part of its initial 
Sections  B and C responses.  
The USDOC followed up with a second supplemental Sections  B-C questionnaire to 
Hyundai  Steel, wherein, for inland freight to warehouse for home market sales, it requested "copies 
of all cont racts that [[***]] has with all unaffiliated parties for similar services that covers the 
POI".414 Additionally, the USDOC asked for a list of all subcontractors that provided warehousing and 
inland freight services for [[***]] during the POI and also sought [[***]] additional sample contracts 
 
406 CRS supplemental Sections B -C questionnaire,  (Exhibit  USA-72 (BCI)), pp.  3-4. 
407 CRS Section B questionnaire response, (Exhibit  KOR-36 (BCI)) , p. B -29. 
408 CRS Section  C questionnaire response, (Exhibit  KOR-51 (BCI)) , exhibit  C-10. 
409 CRS Section  C questionnaire response, (Exhibit KOR -51 (BCI)) , p. C-30. 
410 United  States'  response to Panel question No.  67, para.  77. 
411 CRS Section B questionnai re response, (Exhibit  KOR-36 (BCI)) , pp. B-29 and B -31. 
412 The United  States explains that:  
Specifically, Hyundai [Steel] reports that for the warehouse serviced by [[ ***]], Hyundai Steel 
pays [[ ***]] [[***]] for warehousing, and [[ ***]] pays [[ ***]]. By co mparison, the contract 
between Hyundai [Steel] and [[ ***]] for the [[ ***]] warehouse indicates that Hyundai [Steel] 
pays [[ ***]] just [[ ***]]. Similarly based on Hyundai Steel's  reported average costs for 
warehousing, the average cost for warehousing at [[ ***]] during the [POI] was [[ ***]], while 
Hyundai Steel's  average cost for all warehouses was [[ ***]]. 
(United  States'  response to Panel question No.  67, para.  80 (fns omitted))  
413 United  States'  response to Panel question No.  66(d), para.  75. 
414 CRS supplem ental Sections B -C questionnaire, (Exhibit  USA-15 (BCI)), question 3.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  between [[***]] and its subcontractors for both warehousing  and inland freight services "to show 
that these transactions were at arms -length" .415  
Hyundai Steel responded that for inland freight services to warehouse for home market 
sales, [[***]] did not offer similar services to other unaffiliated parties , and it  was therefore unable 
to provide such contracts as they did not exist.416 As to the USDOC 's request for a list of all of [[***]] 
subcontractors, Hyundai Steel clarified that "while [[***]] maintained over 30  subcontractors for 
various logistics services bot h in Dangjin and Suncheon, [[***]] used only  4 subcontractors for 
warehousing the subject merchandise during the POI".417 Hyundai Steel provided a list of "these 
subcontractors for both freight and warehousing".418 In accordance with the USDOC 's request, 
Hyundai Steel also provided [[***]] additional sample contracts with its subcontractors [[***]]. 
Hyundai Steel pointed out that these contracts covered both warehousing and inland freight 
services.419 
We find two aspects of the USDOC 's second suppl emental questionnaire noteworthy. First, 
there is nothing in the USDOC 's second supplemental questionnaire suggesting that the USDOC 
found any deficiencies in the other information that was previously submitted by Hyundai Steel as 
part of its first two res ponses. Second, the USDOC 's express request in its supplemental 
questionnaire for [[***]] additional sample contracts between [[***]] and its unaffiliated 
subcontractors for warehousing  and inland freight services  shows that it considered such contracts 
to be relevant for the determination of the arm's -length nature of the transactions between 
Hyundai  Steel and its affiliate.  
Subsequently, at verification the USDOC asked for "complete copies of freight contracts 
between [[***]] and its unaffiliated freight  providers that cover the full POI" and "all copies of 
contracts that [[***]] has with all unaffiliated parties for similar services that cover the POI, 
regardless of the unaffiliated parties ' location". The USDOC also requested that "Hyundai Steel obtain 
the total actual costs incurred by [[***]]".420 
The USDOC 's verification report notes that Hyundai Steel officials provided "a chart 
comparing Hyundai Steel 's freight costs with [[***]] total costs" and provided "examples of 
contracts between [[***]] and its subcontractor to show that [[***]] made a profit" .421 However, 
the USDOC observed that "Hyundai Steel did not provide any of the information requested above 
that was in the possession  of [[***]], such as copies of all contracts that [[***]] has with all 
unaffiliated parties for similar services that cover the POI" .422 The reason provided by Hyundai Steel 
officials was that there was no "direct ownership" of [[***]] by Hyundai Steel.423 The USDOC noted 
"the fact that [[***]], along with his father [[***]], possessed the largest ownership shares in 
[[***]] at the same time [[***]] was Vice  Chairman of Hyundai Steel, and while his father [[***]] 
was both a direct and indirect owner of Hyunda i Steel" and queried why, in light of these facts, 
Hyundai Steel could not obtain the requested information from [[***]].424 In response, company 
officials "again stated that Hyundai  Steel does not directly control [[***]]".425 The USDOC "asked 
why [[***]] was willing to provide some information, i.e., the contracts with its subcontractor, but 
was unwilling to provide the additional documentation" requested. Company officials indicated that 
they "did not know, but that the subcontractor information was all that [[***]] was willing to 
provide" .426 
Thus, of the three pieces of information requested by the USDOC at verification, it appears 
that Hyundai Steel furnished two, namely, examples of contracts between [[***]] and its 
 
415 CRS supplemental Sections B -C questionnaire, (Exhibit  USA-15 (BCI)), question 5(B).  
416 CRS second supplemental Sections B -C questionnaire response,  (Exhibit  KOR-37 (BCI)), p.  2. 
417 CRS second supplemental Sections B -C questionnaire response,  (Exhibit  KOR-37 (BCI)), p.  4 
and exhibit  7. 
418 CRS second supplemental Sections B -C questionnaire response,  (Exhibit  KOR-37 (BCI)), p.  4 
and exhibit  7. 
419 CRS second supplemental Sections B -C quest ionnaire response,  (Exhibit  KOR-37 (BCI)), p.  5. 
420 CRS CEP verification report,  (Exhibit  KOR-47 (BCI)) , p. 42. 
421 CRS CEP verification report,  (Exhibit  KOR-47 (BCI)) , p. 42. 
422 CRS CEP verification report,  (Exhibit  KOR-47 (BCI)) , p. 43. 
423 CRS CEP verification report,  (Exhibit  KOR-47 (BCI)) , p. 43. 
424 CRS CEP verification report,  (Exhibit  KOR-47 (BCI)) , p. 44. 
425 CRS CEP verification report,  (Exhibit  KOR-47 (BCI)) , p. 44. 
426 CRS CEP verification report,  (Exhibit  KOR-47 (BCI)) , p. 44. (emphasis original ) WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  subcontractors  allegedly  showing tha t [[***]] made a profit, as well as information regarding [[***]] 
total costs. Moreover, there is nothing in the verification report suggesting that the information 
regarding the subcontractors and the costs incurred by [[***]] was somehow deficient; rathe r, it 
appears that the USDOC, in fact, verified such information without any concerns.427 
In response to the USDOC 's request for "all copies of contracts that [[***]] has with all 
unaffiliated parties for similar services that cover the POI, regardless of t he unaffiliated 
parties ' location", Hyundai Steel stated that it was unable to comply and its officials explained at 
verification that Hyundai Steel does not "directly control" [[***]].428 We recall that in its 
first supplemental questionnaire, the USDOC ha d also made a similar request for "copies of all 
international freight contracts between [[***]] and its unaffiliated customers".429 In response, 
Hyundai Steel stated that [[***]] did not maintain any contracts with unaffiliated customers for 
shipments to the United  States , and that while " [[***]] does provide shipping services to unaffiliated 
customers for shipments to third countries, [[***]] ha[d] declined Hyundai  Steel's reques t to 
provide its contracts with unaffiliated third parties citing the proprietary and confidential nature of 
its transactions with other parties ".430 The USDOC at verification did not express any concerns with 
respect to Hyundai Steel 's previous response.  
In its final determination, the USDOC acknowledged that Hyundai Steel "provided in its initial 
questionnaire response contracts its affiliated company maintained with its sub -contractors 
demonstrating that the affiliated company passed on its full costs plu s an amount to cover the 
affiliated company 's expenses and profit".431 The USDOC also noted that Hyundai Steel "was able to 
obtain this supplier 's cost of acquiring the service in question – on a transaction specific basis – and 
so provided an analysis showing that its affiliated company 's charges well exceeded the cost of 
acquiring the transportation services in amounts that covered all operating costs and provided a 
profit to the company".432 However, besides noting that Hyundai Steel provided this information, the 
USDOC 's final determination contains no explanation as to how it took this information into account 
before resorting to the use of facts available. Rather, the USDOC 's subsequent analysis focuses 
exclusively on the issue of affiliatio n between Hyundai Steel and [[***]], and the information that 
Hyundai Steel claimed it was unable to provide.  
The USDOC noted that when it "specifically requested that Hyundai Steel obtain certain 
freight information between its affiliate and other unaffil iated parties, Hyundai Steel stated that its 
affiliated company refused to provide the data".433 The USDOC stated that  it was able to confirm 
that one of the two largest shareholders of Hyundai Steel 's affiliated freight provider  (i.e. [[***]]) 
is also a part owner of Hyundai Steel, and that the other large shareholder is the Vice Chairman of 
Hyundai Steel, and that the two are related.434 The USDOC thus confirmed that Hyundai Steel and 
[[***]] were "held and commonly controlled by the same family members d uring the POI".435 
Immediately thereafter, the USDOC found that "Hyundai Steel failed to demonstrate the 
arm's -length nature of the services provided by the affiliated company [i.e. [[***]] and its 
U.S. subsidiaries" and it was thus unable to determine the arm's -length nature of the transactions 
between Hyundai Steel and [[***]].436 For these reasons, the USDOC stated that it was "relying on 
facts otherwise available" , with an "adverse inference".437  
Thus, the USDOC 's resort to facts available in its final determination was based upon 
Hyundai Steel 's refusal at verification to provide "all copies of contracts that [[***]] has with all 
unaffiliated parties for similar services that cover the POI, regardless of the unaffiliated 
parties ' location". The US DOC resorted to facts available because it "found" that Hyundai Steel and 
[[***]] were "commonly controlled" and that therefore Hyundai Steel should have been able to 
 
427 CRS CEP verification report,  (Exhibit KOR -47 (BCI)) , p. 42. 
428 CRS CEP verification report,  (Exhibit  KOR-47 (BCI)) , p. 44. 
429 CRS supplemental Sections B -C questionnaire,  (Exhibit  USA-72 (BCI)), p.  9. 
430 CRS supplemental Sections B -C questionnaire respons e, (Exhibit  KOR-34 (BCI)), p.  24. 
(emphasis  added)  
431 CRS issues and decision memorandum,  (Exhibit  KOR-41), p.  71. 
432 CRS issues and decision memorandum,  (Exhibit  KOR-41), p.  71.  
433 CRS issues and decision memorandum,  (Exhibit  KOR-41), p.  73. (fn omitted; emphasis added)  
434 CRS issues and decision memorandum,  (Exhibit  KOR-41), pp.  73-74. The USDOC noted these 
two individuals to be father and son, respectively.  
435 CRS issues and decision memorandum,  (Exhibit  KOR-41), p.  74. 
436 CRS issues and decisi on memorandum,  (Exhibit  KOR-41), p.  74. 
437 CRS issues and decision memorandum,  (Exhibit  KOR-41), p.  74. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  provide the requested information. However, this issue of "common control" was addressed and 
disclosed by Hyundai Steel from the very outset, as part of its initial Section  A response.438 In fact, 
this is confirmed by the USDOC in its final determination, when it notes that " Hyundai Steel defined  
the companies that are members of the Hyundai Mo tor Group and/or held by the [[***]] family as 
being affiliated parties via control by a 'group, ' which has the ability to directly or indirectly control 
its group members, and are expected to cooperate with the [USDOC] 's antidumping 
investigation".439  
Furthermore, we recall that the USDOC in its supplemental questionnaire had already made 
a request similar to the one made at verification by requesting "copies of all international freight 
contracts between [[***]] and its unaffiliated customers".440 In respo nse, Hyundai Steel stated that 
[[***]] did not maintain any contracts with unaffiliated customers for shipments to the 
United  States , and that while " [[***]] does provide shipping services to unaffiliated customers for 
shipments to third countries, [[***]] ha[d] declined Hyundai Steel 's request to provide its contracts 
with unaffiliated third parties citing the proprietary and confidential nature of its transa ctions with 
other parties ".441 The final determination does not address the explanation provided by 
Hyundai  Steel and notes, instead, that "[w]hen the [USDOC]  raised these overlapping 
roles/ownership positions in Hyundai Steel and the affiliated company, Hy undai Steel officials 
continued to indicate that they could not obtain the affiliated company 's information requested by 
the [USDOC] ".442 
The above discussion reveals that Hyundai Steel submitted a variety of information to 
demonstrate the arm's -length natu re of its transactions with its affiliate [[***]] throughout the 
course of the investigation. As part of its initial questionnaire responses, Hyundai Steel submitted 
(a) [[***]] financial statements demonstrating  that the affiliate earned a profit; (b ) warehousing 
contract with [[***]] and a contract with an unaffiliated provider [[***]] that provided warehousing 
service at one warehousing location ( [[***]]); and (c ) copies of international freight contract with 
[[***]], on the one hand, and [[***]] international freight contract with two of its subcontractors 
([[***]] and [[***]]), on the other hand. In its first supplemental response, Hyundai Steel further 
provided s ample inland freight and warehousing contracts between [[***]] and one unaffiliated 
subcontractor, namely, [[***]].443 In response to a specific request by the USDOC in its 
second  supplemental questionnaire, Hyundai Steel provided [[***]] additional inland freight and 
warehousing contracts with its subcontractors [[***]].444 Finally, at verification, Hyundai Steel 
submitted "a chart comparing Hyundai Steel 's freight costs with [[***]] total costs".445 Of all of 
these pieces of information – some of which were supplied in direct response to a specific request 
by the USDOC – the USDOC reviewed and found deficient only [[***]] financial statements. The 
United  States  is unable to point to anything in the Panel record indicating that the USDOC took into 
account or o therwise reviewed and  found deficient any of the other information that was supplied 
by Hyundai Steel to establish the arm's -length nature of its transactions with its affiliate [[***]].446  
Turning now to the substantive provisions of Annex  II to the Anti-Dumping  Agreement , 
paragraph 3 requires, in relevant part, that : 
All information which is verifiable, which is appropriately submitted so that it can be 
used in the investigation without undue difficulties, which is supplied in a timely fashion, 
 
438 See para.  7.90 above.  
439 CRS issues and decision memorandum,  (Exhibit  KOR-41), p.  74. (emphasis added)  
440 CRS supplemental Sections B -C questionnaire,  (Exhibit  USA-72 (BCI)), p.  9. 
441 CRS supplemental Sections B -C questionnaire response,  (Exhibit  KOR-34 (BCI)), p.  24. 
(emphasis  added)  
442 CRS issues and decision memorand um, (Exhibit  KOR-41), p. 74. 
443 CRS supplemental Sections B -C questionnaire response,  (Exhibit  KOR-34 (BCI)), pp.  7 and 9.  
444 CRS second supplemental Sections B -C questionnaire response,  (Exhibit  KOR-37 (BCI)), p.  5. 
445 CRS CEP verification report,  (Exhibit  KOR-47 (BCI)) , p. 42. 
446 United  States'  responses to Panel question Nos. 12 and 67. The United  States offers some 
reasons  in its submissions to the Panel as to why some of this information may not be relevant. (See, 
e.g. United  States'  response to Panel question No.  67, para.  80; and response to Panel question No.  12, 
para. 50). However, as explained in para.  7.123  above, what is important is that the USDOC did  not provide 
any such reasoning or explanation.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 63 - 
 
  and, where applicable, which is supplied in a medium or computer language requested 
by the authorities, should be taken into account  when determinations are made.447 
Paragraph 3 provides key elements of the "substantive basis" for an investigating authority to 
determine whether it can justify rejecting respondents ' information and resorting to facts available 
in respect of some item, or items, of information, or whether instead it must rely on the information 
submitted by respondents "when determinations are made ".448 If, in direct response to a request by 
an investigating authority, a respondent provides information that satisfies the criteria under 
paragraph  3, the authority must take such information "into account" before resorting to facts 
available.449 This is because a finding that information "necessary" for making a certain 
determination is "missing" , or that an interested party significantly impeded the investigation , can 
only properly be made after "taking into account" all information that was, in fact, su pplied by the 
interested party in response to an investigating authority 's requests. An investigating 
authority 's conclusion for purposes of Article  6.8 that "necessary" information is missing or that a 
respondent significantly impeded the investigation wo uld be tainted if the information that meets 
the criteria of paragraph  3 and that was supplied by an interested party directly in response to an 
investigating authority 's request is not taken into account by the authority before resorting to facts.  
In our  view, the information supplied by Hyundai Steel in response to the USDOC 's queries 
satisfies  the criteria under paragraph  3. All of the information identified above was provided either 
as part of Hyundai Steel 's Sections  B and C questionnaire responses th at were submitted within the 
deadlines established by the USDOC , or upon the USDOC 's request at verification. In the absence of 
any findings of delay by the USDOC, we agree with Korea that this information was supplied in a 
"timely fashion" for purposes of  paragraph  3.450 Moreover, there is nothing to suggest that the 
information was not verifiable. In fact, as Korea rightly points out, the USDOC appears to have 
successfully verified many pieces of the submitted information, including the total actual costs 
incurred by [[***]], as well as inland freight contracts between [[***]] and its unaffiliated 
subcontractor. Finally, the fact that some of this information – such as the [[***]] additional inland 
freight and warehousing contracts between [[***]] and its subcontractors – was provided in direct 
response to a specific request by the USDOC suggests that this information was considered relevant 
by the USDOC and  – in the absence of any  finding by the USDOC to the contrary – was appropriately 
submitted such that it could be used in the investigation without "undue difficulties".  
For these reasons, we find that the USDOC acted inconsistently with the first sentence of 
paragraph  3 of Annex II to the Anti -Dumping  Agreement  by not "tak[ing] into account " the 
information  concerning affiliated party transactions  that was submitted by Hyundai Steel  in 
accordance with that provision . Given that paragraph  3 of Annex  II serves as a precondition fo r an 
investigating authority 's proper  resort to facts available under Article  6.8 of the 
Anti-Dumping  Agreement451, we find that the USDOC also acted inconsistently with that provision in 
resorting to facts available . In light of our findings of WTO -inconsistency, we do not consider it 
necessary to rule upon Korea 's claims under paragraphs 1, 5, and 6 of Annex  II to the 
Anti-Dumping  Agreement  in order to provide a positive solution to the dispute before us .452 
7.3.2.2.3.2   The USDOC 's selection of the replacement facts  
We have already found that the USDOC erred in resorting to facts available with respect to 
the information concerning affiliated party transactions that was submitted by Hyundai Steel. In 
these circumstances, we do not  consider that making further findings on Korea 's claims concerning 
the USDOC 's selection of the replacement facts on the basis of the record used for the 
USDOC 's WTO-inconsistent findings would assist in providing a positive solution to the dispute before  
us.453  
 
447 Emphasis added.  
448 Panel Report, Egypt – Steel Rebar , para.  7.159.  
449 Panel Report, Egypt – Steel Rebar , para.  7.159.  
450 Korea's  first written submission, para.  293. 
451 Panel Reports, China – GOES , para.  7.385; US – Steel Plate , paras.  7.55-7.56 and 7.79.   
452 See, e.g. Panel Report, EC – Salmon (Norway) , para.  7.387; and Panel Report, Morocco – Hot-Rolled 
Steel (Turkey) , paras.  7.105 -7.106.  
453 See, e.g. Panel Reports, Egypt – Steel Rebar , para.  7.310 ; and Mexico – Anti-Dumping Measures on 
Rice, para.  7.200. See also Panel Report, China – Broiler Products , para. 7.555.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 64 - 
 
  
Alleged misreporting of control numbers ( CONNUMs ) 
7.3.2.3.1   Factual background  
The USDOC requested Hyundai Steel to provide information about further -manufacturing 
expenses of CRS in the United  States .454 In response, Hyundai Steel submitted a revised US sale s 
database reporting the adjusted unit and total costs and , as a result , recalculated the indirect selling 
expenses of HSA.455 In its preliminary determination, the USDOC found that "Hyundai Steel 
cooperated with the [USDOC]  in this proceeding and provided sufficient information to allow the 
[USDOC]  to calculate a margin" , thus reject ing the petitioners ' suggestion to apply "tota l AFA".456 
The USDOC calculated a preliminary dumping margin of 2.17% based on the data submitted by 
Hyundai Steel.457 
During verification of Hyundai Steel 's export sales, the USDOC raised certain inconsistencies 
in the reporting of the quality codes for Spe c C products. Specifically, the USDOC noted that for one 
sale (surprise US sale 3 ) Hyundai Steel had reported the product code (field PRODCOD2U ) as 
[[***]], indicating that this was a n ultra-high-strength  steel (UHSS ) or advanced high -strength steel 
(AHSS ) merchandise, which warranted a quality reporting code (field QUALITYH/U ) of "20".458 
However, Hyundai Steel reported a quality code of "25" ("high -strength low alloy" quality).459 
Hyundai Steel commented that this inconsistency resulted from a "linking problem" between 
HSA's purchases from Hyundai Steel and its sales.460 The USDOC chose not to review this issue 
during Hyundai Steel 's verification461, but further considered it during HSA's verification:  
For certain sale observations, including one of the surprise sale trace observations first 
examined during the verification of Hyundai Steel in Korea, the company official 
explained why the reported "specification" (intended to reflect the specification/grade 
of the source Hyundai Steel coil, which the company official had indicated was used for 
reporting information in the product characteristic fields, SPECGRADEH/U and 
QUALITYH/U ) was inconsistent with the reported product code (PRODCO D2U) (which 
the company official indicated was the specification/grade of the product sold by HSA, 
according to HSA 's records). However, the company official did not identify additional 
sale observations in the U.S. sales database with such inconsistencies .462 
Regarding this sale, Hyundai Steel provided additional details to explain why it had identified 
the CONNUM as [[***]], even though the reported product code was [[***]]: 
The company official stated this sale observation meets the description of the "ty pe 2b" 
transactions referenced in the Sales Reconciliation section  above, such that it could link 
the merchandise sold by HSA to the original Hyundai Steel coil but not to an HSA 
production order, and in this instance, the original Hyundai Steel coil was c old-rolled 
and classified as specification [[***]] (see page 62). The company official identified for 
us additional sale observations, which it called "type 3" transactions, for which it could 
identify the HSA production order, and which it could link to a n original Hyundai Steel 
coil that was a cold -rolled coil, but where the original Hyundai Steel cold -rolled coil was 
of a different specification than that identified for the HSA sale (see page 61). For 
example, the first Hyundai Steel in the "type 3" section of page 61, [[***]], was 
identified by the Hyundai Steel information as specification [[***]], but many of the 
sale observations linked to that coil were reported with a different specification 
([[***]]).463 
Furthermore, the USDOC conducted a "completen ess test" with respect to certain sales that 
presented this inconsistency. In particular, the USDOC reviewed certain sales that presented 
 
454 CRS supplemental Sections A -C questionnaire response, (Exhibit  KOR-42 (BCI)), pp.  1-3. 
455 CRS supplemental Sections A -C questionnaire response, (Exhibit  KOR-42 (BCI)), pp.  1-3. 
456 CRS decision memorandum  for preliminary determination, (Exhibit  KOR-43), p.  3. 
457 CRS preliminary determination,  (Exhibit  KOR-44). 
458 CRS CEP verification report, (Exhibit  KOR-47 (BCI)), pp.  19 and 41.  
459 CRS CEP v erification report, (Exhibit  KOR-47 (BCI)), pp.  19 and 41.  
460 CRS CEP verification report, (Exhibit  KOR-47 (BCI)), p.  41. 
461 CRS CEP verification report, (Exhibit  KOR-47 (BCI)), p.  41. 
462 CRS HSA sales verification report, (Exhibit  KOR-46 (BCI)), p.  2. 
463 CRS HSA sales verification report, (Exhibit  KOR-46 (BCI)), p.  13. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 65 - 
 
  discrepancies between the reported PRODCOD2U and QUALITYU fields, noting that rather than 
reporting the field QUALITYU so as to reflect with the [[***]] categori zation of Spec  C products, the 
reported QUALITYU was equal to [[***]] (representing [[***]]) or [[***]] (representing 
[[***]]).464 
In its case brief, Hyundai Steel addressed the issue regarding the "type 2b" sale and 
explained that even though the reported informational product code (PRODCOD2U ) for this sale was 
[[***]], the "actual product produced and sold was a [[***]] product", for which the corresponding 
quality code was "25".465 Hyundai Steel noted that it correctly reported the product characteristic 
information on the basis of the product as produced and sold, and  therefore no revision was 
necessary.466 Finally, Hyundai Steel stressed that this issue was minor since it concerned a single 
sale in the database.467 In its rebuttal brief, Hyundai Steel addressed the alleged misreporting of 
Spec C sales ("type 3" ) as qual ity [[***]] or [[***]].468 Hyundai Steel explained that the 
informational product code (PRODCOD2U ) was identified based on HSA 's records, however , in a few 
instances this field did not match the CONNUM as sold (the actual product).469 According to 
Hyundai  Steel, such an inconsistency may occur when HSA 's inventory records do not perfectly trace 
the product information back to the imported coil , or when HSA sold a higher or comparable grade 
product as a substitute for another product.470 For Hyundai Steel, the issue was precisely the 
replacement of orders of a commercial quality steel (quality code [[***]]) with higher quality steel 
(quality code [[***]] or [[***]]), which demonstrate d that there was no flaw in  its reporting.471 
Finally, H yundai Steel noted that , although its reporting was not erroneous , the allegedly 
misreported Spec  C sales as quality [[***]] or [[***]] represented only [[***]]% of all Spec C sales 
and [[***]]% of all US sales, and th erefore  had no meaningful impact on th e USDOC 's analysis.472 
In addition to the issue in the export sales, during verification of home market sale s, the 
USDOC questioned the product quality reporting for three product categories, Spec s D, E, and H. 
With respect to Spec D, the USDOC noted that products with the designation [[***]] were identified 
as commercial quality  (QUALITYH/U="35").473 The USDOC noted that according to the 
company 's internal product guidelines, the mechanical and chemical r equirements of this 
specification code were consistent with the description of drawing quality  product s.474 In its case 
brief, Hyundai Steel responded that the "QUALITY classification of this product as a commercial steel 
quality product as opposed to a dra wing steel quality product was reasonable even if the mechanical 
and physical requirements of the product are consistent with other products classified as drawing 
steel products".475 However, Hyundai Steel emphasized  the fact that [[***]] products were not 
commonly sold by Hyundai Steel, and noted that the sales of this product in the home market were 
limited to [[***]] out of a total of [[***]] reported home market sales observations.476 For this 
reason, Hyundai Steel argued that "the QUALITY classification of this product has no meaningful 
impact on the [USDOC] 's analysis in light of the insignificant quantity of merchandise at issue".477 
Regarding Spec E sales, the USDOC asked why there were no yield strength measurements 
for [[***]] spec code products, and Hyundai Steel responded that these products were not "prime" 
 
464 CRS HSA sales verification report, (Exhibit  KOR-46 (BCI)), pp.  10-11. 
465 CRS case brief, (Exhibit  KOR-48 (BCI)), p.  11. 
466 CRS case brief, (Exhibit  KOR-48 (BCI)), p.  11. 
467 CRS case brief, (Exhibit  KOR-48 (BCI)), pp.  11-12. 
468 CRS rebuttal brief, (Exhibit  KOR-29 (BCI)), pp.  12-15. The alleged misreporting concerned the 
"type  3" transactions identified by Hyundai Steel at verification, and certain additional transactions that were 
not reported . Hyundai Steel explained that the table it prepared for verification (SVE 17, page 61) was only for 
"type 3" sales, and not any instances of mismatching between PRODCOD2U and QUALITYU corresponded to 
this type of sales.  
469 CRS rebuttal brief, (Exhibit  KOR-29 (BCI)), p.  13. 
470 CRS rebuttal brief, (Exhibit  KOR-29 (BCI)), p.  13. 
471 CRS rebuttal brief, (Exhibit  KOR-29 (BCI)), p.  14. 
472 CRS rebuttal brief, (Exhibit  KOR-29 (BCI)), p.  15. 
473 CRS CEP verification report, (Exhibit  KOR-47 (BCI)), pp.  2 and 21.  
474 CRS CEP verification report, (Exhibit  KOR-47 (BCI)), pp.  2 and 21. The USDOC came to this 
conclusion by observing the internal production guideline of Hyundai Steel for this product, which identified 
certain mechanical and chemical requirements (maximum mangan ese content, maximum phosphorus 
content  and minimum tensile strength)  which were consistent with [[ ***]], rather than [[ ***]]. 
475 CRS case brief, (Exhibit  KOR-48 (BCI)), p.  12. 
476 CRS case brief, (Exhibit  KOR-48 (BCI)), p.  12. 
477 CRS case brief, (Exhibit  KOR-48 (BCI)), p.  12. See also CRS rebuttal brief, (Exhibit  KOR-29 (BCI)), 
p. 16. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 66 - 
 
  and that it did not record yield strength information for non -prime merchandise.478 However, the 
USDOC identified [[***]] sale observations of this product in the home market which had been 
report ed as "prime" products and noted that, in the sales documentation covering the sale of this 
product, the "packing list" contained a yield strength box.479 Hyundai Steel did not comment on this 
issue in its case brief. In its rebuttal brief, Hyundai Steel ar gued that the "sales documentation for 
these products do not contain specification yield strength information confirming that no yield 
strength was required and thus it is entirely reasonable for there not to be any yield strength 
documentation".480 Hyundai Steel clarified that additional review of these sales had shown that these 
sales were prime sales, but, nonetheless,  this product did not require yield strength measurement.481 
Hyundai Steel further noted that this product was not sold in the US ma rket, and in the home market 
it represented only [[***]] out of the [[***]] sales observations.482 
Finally, with respect to Spec H sales, the USDOC noted that it could not find in the 
information supplied any reference to the [[***]] spec code product.483 The USDOC referred to 
[[***]] home market sale observations identified as this product, each with the QUALITYH 
code "20", which was applicable to UHSS or AHSS merchandise; accordingly, it noted that there was 
no indication that this product met the company 's characterizations of UHSS or AHSS 
merchandise.484 Hyundai Steel in its case brief explained that the classification of this product as an 
UHSS quality product was justified by its classification in Hyundai Steel 's product coding system in 
the normal course  of business.485 Hyundai  Steel also argued that the appropriate coding of this 
product had no measurable impact on the USDOC 's analysis due to its insignificant home market 
sales (only [[***]] transactions), and also because there were no such sales in the United  States  
during the POI.486 In its rebuttal brief, Hyundai Steel also asserted that , "for the few products the 
[USDOC]  flagged for further consideration, these products [were] either demonstrably coded 
correctly, sold in insignificant volumes, or both" , and that "Hyundai Steel 's reporting [was] accurate 
and no adjustment [was] required, let alone an AFA or total AFA adjustment".487 
In its final determination, the USDOC applied facts available with an adverse inference to 
the information associated with t he inconsistencies in reporting Specs C, D, E , and H sales.488 The 
USDOC applied facts available because the missing information was "necessary" and Hyundai Steel 
"withheld the requested information, [thus] significantly imped [ing] the proceeding  … and the 
[USDOC]  was therefore unable to verify the missing informatio n".489 The USDOC also determined 
that the application of an adverse inference  was warranted due to Hyundai Steel 's failure to 
cooperate by not acting to the best of its ability, given that "the information was never provided, 
and was instead discovered by t he [USDOC]  at verification".490 
Specifically, with respect to Spec C sales (those identified during verification and those later 
referenced to by the USDOC), the USDOC found an inconsistency between the reported CONNUM 
information and the reported product c ode in the field PRODCOD2U due to the different qualities 
corresponding to each specification.491 Regarding Spec D, the USDOC determined that the proper 
 
478 CRS CEP verification report, (Exhibit  KOR-47 (BCI)), p.  21. 
479 CRS CEP verification report, (Exhibit  KOR-47 (BCI)), p.  22. 
480 CRS rebuttal brief, (Exhibit  KOR-29 (BCI)), p.  17. 
481 CRS rebuttal brief, (Exhibit  KOR-29 (BCI)), fn 26.  
482 CRS rebuttal brief, (Exhibit  KOR-29 (BCI)), p.  17. 
483 CRS CEP verification report, (Exhibit  KOR-47 (BCI)), p.  21. 
484 CRS CEP verification report, (Exhibit  KOR-47 (BCI)), p.  21. In detail, the USDOC noted that this 
product was not included in the list initially submitted as representing the products considered UHSS or AHSS 
merchandise, nor in the AHSS grouping of products subsequently provided upon discussion of the topic of 
UHSS and AHSS merchandise.  
485 CRS case brief, (Exhibit  KOR-48 (BCI)), pp.  12-13. 
486 CRS case brief, (Exhibit  KOR-48 (BCI)), p.  12; See also CRS rebuttal brief, (Exhibit  KOR-29 (BCI)), 
pp. 16-17. 
487 CRS rebuttal brief, (Exhibit  KOR-29 (BCI)), p.  47. 
488 CRS issues and decision memorandum, (Exhibit  KOR-41), pp.  59-60.  
489 CRS issues and decision memorandum, (Exhibit  KOR-41), p.  60. 
490 CRS issues and decision memorandum, (Exhibit  KOR-41), p.  60. 
491 The USDOC stated that:  
More fundamentally, during the Hyundai Steel sales verification  the company had stated that "HSA 
did not intentionally alter or revise the specification and grade designations from those of the 
original coil it purchased from Hyundai Steel." Given that explanation, as well as the lack of 
information on the record to s upport the respondent's  belated assertions regarding products 
 WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 67 - 
 
  characteri zation of the products at issue was of "drawing quality" and not of "commercial quality".492 
With respect to Spec E, the USDOC found that there was no basis for not reporting the yield strength 
field.493 Finally, regarding Spec H, the USDOC was not convinced that Hyundai Steel properly 
classified those products as AHSS/UHSS quality.494 
Overall, the US DOC found that "Hyundai Steel had no plausible explanation either at 
verification or in its case and rebuttal briefs for misidentifying these sales" and thus it did not 
cooperate at the best of its ability, rendering the application of an adverse inference  necessary.495 
To sales associated with the Spec C issue, the USDOC assigned the highest calculated margin for 
any other reported US sale of Hyundai Steel, [[***]]%.496 For home market sales under Specs  D, 
E, and H, the USDOC revised the "incorrect product c haracteristics" as described above, and as a 
 
meeting multiple specifications, we find that the sales in question (i.e. those referenced in the 
second grouping at the bottom of page 61 of the HSA sales verification exhibit  17, and those 
identified within the last two paragraphs on page 10 of the HSA sales verification report)  are 
considered unverified. Those sale observations were not shown to be linked to the products as 
imported into the United  States, and no adequate explanation has been provided by the respondent 
for those mismatches between the alleged Hyundai Steel input coils and the products sold by HSA 
to its unaffiliated U.S. customers. These mismatches were not identified by the respondent prior 
to verification.  
(CRS issues and dec ision memorandum, (Exhibit  KOR-41), p.  62) 
492 The USDOC stated that:  
As noted in the [USDOC]'s  Hyundai Sales verification report, the products have properties 
associated with the former [drawing] quality. Furthermore, the Spec D is even identified in a way 
that is very obviously characteristic of drawing quality rather than commercial quality , given 
Hyundai Steel's  product coding designations, which were examined in detail during the verification 
of Hyundai Steel. Therefore, the [USDOC] is revising the repor ting of that product characteristic 
for the sales in question.  
(CRS issues and decision memorandum, (Exhibit  KOR-41), p.  60 (emphasis added; fns omitted))  
493 The USDOC stated that:  
Regarding Spec E products, Hyundai Steel identified a minimum specified yiel d strength for the 
products in question. Hyundai Steel's  reporting of the minimum yield strength code for products 
classified under this specification (code "1")  was consistent with the identified minimum specified 
yield strength. However, at verification it was determined that there was no basis for the minimum 
specified yield strength that Hyundai Steel identified. Documentation examined at verification 
indicated there was no minimum specified yield strength required for the specification. Further 
examina tion at verification also revealed the absence of evidence of any actual yield strength 
measurements for the products in question, which Hyundai Steel initially opined was due to the 
merchandise being classified as non -prime merchandise. However, the [USDO C] concluded that 
the merchandise had been properly reported by Hyundai Steel as prime merchandise, not 
non-prime merchandise . During the discussions of this specification, therefore, Hyundai Steel 
provided no information indicating how it had devised the minimum yield strength value it had 
identified as the basis for reporting the minimum specified yield strength field. The minimum 
specified yield strength identified by Hyundai  Steel for Spec E, therefore, is unsupported by the 
record . The record indicates , however, that the minimum specified yield strength for the galvanized 
steel products made from Spec E is a level that would fall in reporting code "4" for the minimum 
specified yield strength characteristic. Accordingly, under section  776(a)  of the Act, as facts 
otherwise available, the [USDOC] is reclassifying the products under Spec E with the minimum 
specified yield strength reporting code of "4".  
(CRS issues and decision memorandum, (Exhibit  KOR-41), p.  61 (emphasis added; fns omitted))  
494 The USDOC stated that:  
As the [USDOC] has noted, the product -specific documentation provided by the respondent at 
verification that utilizes AHSS/UHSS terminology does not reference Spec H products. During 
discussions of this product at verification, Hyun dai Steel provided technical information supporting 
its reporting of the products in question as AHSS/UHSS quality. In addition, although Spec  H 
products have some basic strength requirements, they do not possess any chemical requirements, 
so they may cont ain little or no amount of alloying elements associated with AHSS/UHSS 
(or high-strength low -alloy products). The properties of the merchandise are not consistent with 
AHSS/UHSS merchandise, based both on Hyundai Steel's  representations of such products an d 
upon information about such products elsewhere on the record. Thus, there was no basis for 
Hyundai  Steel to report the products as AHSS/UHSS quality ; based on the information available, 
the [USDOC] concludes it is best characterized for this investigatio n as structural quality (QUALITY 
reporting code 30)  and is revising the sales as such.  
(CRS issues and decision memorandum, (Exhibit  KOR-41), pp.  60-61 (emphasis added; fns omitted))  
495 CRS issues and decision memorandum, (Exhibit  KOR-41), p.  63. 
496 CRS issues and decision memorandum, (Exhibit  KOR-41), p. 63; CRS final calculation memo, 
(Exhibit  KOR-49 (BCI)), p.  6. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 68 - 
 
  result the CONNUMs for the associated sales were also revised to reflect the change in the product 
characteristics .497 The USDOC assigned to the appropriate CONNUMs : 
The highest total cost of manufacturing (AVGTC OM) from amongst the affected 
CONNUMs ( i.e., the reported CONNUMs for the sales in question plus the CONNUMs into 
which such sales were reclassified as a result of the correction of the product 
characteristic in question), along with the corresponding variable cost of manufacturing 
(AVGVCOM ) for the  CONNUM with the highest reported AVGTCOM, was applied to all of 
the affected CONNUMs, with one exception, as discussed below.  
For one of the miscoded CONNUMs ( [[***]]), the volume of reported sales equaled the 
volume of sales for that CONNUM across both t he home market and U.S. sales 
databases, and that volume also equaled the volume of production quantity for the 
CONNUM in question. When the incorrectly reported product characteristic for that 
CONNUM were corrected, the revised CONNUM ( [[***]]) was one wh ich already exists, 
and for which no product coding issues were identified. We recalculated the AVGTCOM 
and AVGVCOM for that revised CONNUM so that they are based on the weight -averaged 
(by PRODQTY ) values of the AVGTCOMs and AVGVCOMs of the original and t he revised 
CONNUMs.498 
7.3.2.3.2   Main a rguments of the parties  
Korea claims that the USDOC acted inconsistently with Article  6.8 of the 
Anti-Dumping  Agreement  in resorting to facts available because the information allegedly missing 
was not "necessary"499 and because Hyundai Steel did not "significantly impede []" the 
investigation.500 Korea contends that this is not a situation where information was missing, but 
instead a situation of alleged misreporting of information.501 Korea asserts that the information at 
issue was  not "necessary" to complete the determination, and that the USDOC never explained how 
the alleged ly minuscule errors could possibly amount to withholding "necessary information".502 With 
respect to Spec C sales, Korea argues that these sales represented on ly [[***]]% of total SPCC 
sales, and [[***]]% of total US sales in the POI. As to home market sales (Specs D, E , and H), 
Korea argues that these transactions represented only [[***]]% of total transactions or [[***]]% 
of the total MT weight of all home market sales.503 In addition, there were no such sales in the 
US market during the POI.504 
Korea asserts that the methodology used by Hyundai Steel in reporting these products was 
reasonable and supported by sufficient exp lanation and further evidence provided at verification.505 
Korea describes the inconsistencies at issue as a "technical issue" that arose during verification 
because of the fact that the records kept in the ordinary course of business did not necessarily 
correspond with the CONNUMs imposed by the USDOC for purposes of its investigation.506 The 
mismatches were the result of the complex nature of combining internal product codes and 
CONNUMs in situations where the products are further processed.507 Specifically for the Spec  C 
US sales, Korea asserts that regardless of the field PRODCOD2U, which was provided for 
informational purposes and not used in the USDOC 's calculations, Hyundai Steel correctly reported 
the CONNUM data on the basis of the product as produced and imported.508  
 
497 CRS issues and decision memorandum, (Exhibit  KOR-41), p.  63. 
498 CRS final calculation memo, (Exhibit  KOR-49 (BCI)), p.  5. 
499 Korea's  first writte n submission, para.  274. 
500 Korea's  first written submission, para.  280. 
501 Korea's  response to Panel question No.  16(a).  
502 Korea's  response to Panel question No.  16(c). Korea's  contends that the transactions at issue were 
insignificant, and therefore not "n ecessary" to complete the determination. ( Korea's  first written submission, 
para. 276).  
503 Korea's  first written submission, para.  275. 
504 Korea's  first written submission, para.  243. 
505 Korea's  first written submission, para.  277. 
506 Korea's  first written submission, para.  279. 
507 Korea's  first written submission, para.  279. 
508 There were limited instances, according to Korea, where Hyundai Steel's  reported CONNUM 
information (the product produced and imported)  did not match the field PR ODCOD2U (including informational 
 WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 69 - 
 
  
Korea further claims that the USDOC acted inconsistently with paragraph  6 of Annex  II, as 
it did not offer to the respondent an opportunity to provide further explanations after the alleged 
misreporting had been identified, with the "dialogue" effectively ending after verification.509 
Moreover, the USDOC in its final determination did not ad dress Hyundai Steel 's arguments regarding 
the "miniscule volume " of the sales in question, and did not explain its rejection of the explanations 
provided by Hyundai Steel.510 
Finally, Korea claims that the USDOC acted inconsistently with paragraphs 3 and 5 of 
Annex  II by disregarding information that had already been verified as accurate.511 Korea notes that 
the USDOC applied facts available not only with respect to the problematic sales, but also with 
respect to the whole CONNUMs into which sales were reclassified.512 According to Korea, the USDOC 
unduly replaced verified sales information an d costs with assumptions based on adverse 
inferences.513 Korea claims that "Hyundai Steel fully explained the reasonableness of its coding 
scheme and provided supporting materials at verification", and that "[n]othing on the record 
suggests that any of thes e alleged minor reporting inaccuracies constituted an attempt by 
Hyundai  Steel to report intentionally incorrect data or a failure to exert its best efforts to comply 
with the USDOC 's information requests".514  
As to the USDOC 's selection of the replacement  facts, Korea claims that the USDOC acted 
inconsistently with paragraph  7 of Annex  II and Article  6.8.515 Korea contends that the USDOC 
assigned the highest reported total cost of manufacturing for the home market sale s, and the highest 
calculated dumping m argin for US  sales, without engaging in a process of reasoning and evaluation 
as to how these facts were reasonable replacements for the alleged ly missing information.516 
According to Korea, the selection of the replacement facts was punitive in nature a nd the USDOC 
deliberately selected adverse information to penalise Hyundai  Steel.517 Korea contends that the facts 
were chosen for the sole reason that they were the highest reported costs or dumping margin, and 
were not related to the issue of the correct CON NUM determination.518 Finally, Korea argues that 
the USDOC did not consider the aberrational nature of the replacement facts.519 
The United  States  responds that Hyundai Steel failed to provide requested "necessary" 
information and identifies  the missing information as "the cost of manufacturing associated with 
certain products where product specifications were unverified".520 The United  States  asserts that the 
"proper reporting  of the CONNUMs assigned to each product" is crucially important for the calculation  
of the dumping margin since "[m]isreporting products sold has the effect of distorting the calculated 
margin, because certain costs that should be associated with a given CONNUM are instead associated 
with a different CONNUM, which can significantly affec t the price comparison between the home 
market and U.S. sales and ultimately the dumping margin".521 The United  States  asserts that, 
because of this misreporting, the USDOC could not rely on the reported information for those classes 
of products.522 Accordin g to the United  States , "the magnitude of the erroneously reported 
information is not the standard against which information is judged for its necessity; instead, it is 
whether the information is 'required to complete a determination'".523 The United  States  argues that, 
contrary to Korea 's assertions, Hyundai Steel had provided no plausible explanation for its 
 
product quality code)  based on HSA's  records for CEP sales. In other words, in certain instances HSA imported 
steel of one specification to make a further manufactured product and sold the finished product under a 
different  specification. (Korea's  first written submission, paras.  243 and 275; response to Panel 
question  No. 16(a)).  
509 Korea's  first written submission, para.  282. 
510 Korea's  first written submission, paras.  277 and 282.  
511 Korea's  first written submission, paras.  296 and 305.  
512 Korea's  first written submission, paras.  302 and 305.  
513 Korea's  first written submission, paras.  306-307. 
514 Korea's  first written submission, paras.  299-300. 
515 Korea's  first written submission, para.  321. 
516 Korea's  first written submission, para. 322. See also Korea's  second written submission, para.  77. 
517 Korea's  first written submission, para.  325. 
518 Korea's  first written submission, para.  326. 
519 Korea's  first written submission, paras.  327-329. See also Korea's  second written submission, 
paras.  124-126 and 128 -130. 
520 United  States'  response to Panel question No.  16(a), para. 64.  
521 United  States'  first written submission, para.  133. 
522 United  States'  first written submission, para.  134. 
523 United  States'  first written submission, para. 166. See also United  States'  response to Panel question 
No. 16(b).  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 70 - 
 
  misreporting.524 The United  States  further argues that Hyundai Steel failed to substantiate certain 
instances of its misreporting, and whe n it did, the USDOC "took great pains to explain  exactly  why 
each of [Hyundai Steel's] explanations was not sufficient ", thus act ing consistently with its 
obligations under paragraph  6 of Annex  II.525 
With respect to Korea 's claims under paragraphs 3 and 5 of Annex  II, the United  States  
argues that the USDOC applied facts available only to issues for which the respondent was unable 
to substantiate its product reporting.526 According to the United  States , Korea fail s to demonstrate 
that the USDOC did not take into account all verifiable and substantiated facts.527 Regarding the use 
of facts available for the affected CONNUMs in their entirety, the United  States  responds that the 
CONNUMs into which the sales in question were reclassified "were no longer accurate and required 
revision".528 Finally, the United  States  argues that Hyundai Steel had not acted to the best of its 
ability and for this reason the USDOC was not bound by paragraphs 3 and 5 of Annex  II.529 
In relation to the USDOC 's selection of the replacement  facts, the United  States  responds  
that Korea has failed to established any breach of the Anti -Dumping  Agreement .530 According to the 
United  States , Korea does not provide  an explanation for why the USDOC 's process for selecting the 
values is inconsistent with any specific provision of the Anti -Dumping  Agreement .531 
7.3.2.3.3   Evaluation by the Panel  
7.3.2.3.3.1   The USDOC 's resort to facts available  
Korea claims that the USDOC acted inconsistently with Article  6.8 and paragraphs 3, 5, and 
6 of Annex  II of the Anti -Dumping Agreement  in resorting to the use of facts available in respect of 
Hyundai Steel 's reporting of  certain  CONNUMs.  
In its final determination, the USDOC explained that it resorted to "partial AFA where data 
do not exist on the record to fully correct th e problems in question".532 The "problems in question" 
relate d to separate reporting issues affecting certain home market sales and US sales. We will first 
examine the issues pertaining the home market sales – concerning Specs  D, E, and H – before 
examining  the US market sales concerning Spec  C.  
Spec s D, E, and H sales  
The USDOC found discrepancies between product characteristics for certain Spec s D, E, 
and H sales observed in the product database at verification, on the one hand, and the specifications 
originally reported by Hyundai Steel, on the other hand.533 For Spec D sales, the USDOC explained 
that "the products in question are properly characterized as drawing quality products rather than 
commercial quality products", as reported by Hyundai Steel, and that it was therefore "revising the 
reporting of that product characteristic for the sales in question".534  
Regarding Spec E, the USDOC explained that Hyundai Steel 's initial "reporting of the 
minimum yield strength code for products classified under this specification (code  '1') was consistent 
with the identified minimum specified yield strength". However, at verification, the USDOC found 
the "minimum specified yield strength identified by Hyundai Steel for Spec  E" to be "unsupported by 
the record". Instead, the USDOC found the record to indicate that "the minimum specified yield 
strength for the galvanized steel products made from Spec E is a level that would fall in reporting 
code '4' for the minimum specified yield strength characteristic"  and, therefore, "under 
 
524 United  States'  first written submission, para.  166. 
525 United  States'  first written submission, para.  168. 
526 United  States'  first written submission, para.  180. 
527 United  States'  first written submission, para.  180. 
528 United  States'  response to Panel question No.  16(d), para. 76.  
529 United  States'  first written submission, para.  181. 
530 United  States'  first written submission, para.  194. 
531 United  States'  first written submission, para.  195. 
532 CRS issues and decision memorandum, (Exhibit  KOR-41), p.  59. 
533 CRS HSA sales verification report, (Exhibit  KOR-46 (BCI)), p.  2. See also United  States'  first written 
submission, para.  130.  
534 CRS issues and decision memorandum, (Exhibit  KOR-41), p.  60. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  section  776(a ) of the Act, as facts otherwise available", the USDOC "reclassif[ied] the products under 
Spec E with the minimum specified yield strength reporting code of '4'" .535  
For Spec H, the USDOC observed that Hyundai Steel had  classified these products as 
"AHSS/UHSS". However, "based both on Hyundai Steel 's representations of such products and upon 
information about such products elsewhere on the record", the USDOC concluded that the product 
"is best characterized for this inve stigation as structural quality (QUALITY reporting code  30)" and 
thus "revis[ed] the sales as such".536 Thus, for the affected Spec s D, E, and H sales, the USDOC 
corrected and revised the misreported product characteristics by using "facts otherwise availab le". 
In its final calculation memorandum, the USDOC explained that:  
The incorrect product characteristics in question were corrected for those sales, and the 
CONNUMs for those sales revised accordingly. The reported CONNUMs for these home 
market sale obser vations were identified, and the incorrect product characteristics for 
them were corrected. The CONNUMs for those sales were also revised to reflect the 
change in the product characteristic in question. The highest total cost of manufacturing 
(AVGTCOM ) from amongst the affected CONNUMs ( i.e., the reported CONNUMs for the 
sales in question plus the CONNUMs into which such sales were reclassified as a result 
of the correction of the product characteristic in question), along with the corresponding 
variable co st of manufacturing (AVGVCOM ) for the CONNUM with the highest reported 
AVGTCOM, was applied to all of the affected CONNUMs[ .]537  
Referring to the above excerpt from the final calculation memorandum, the United  States  
explains that, "[p]ut another way,  [the] USDOC considered that the CONNUMs into which the sales 
in question were reclassified were no longer accurate  and required revision".538 In support of this 
assertion, the United  States  refers the panel to a specific part of the final determin ation. However, 
we do not find any explanation in this part of the Final Determination  as to why the CONNUMs into 
which the corrected sales were classified into were "no longer accurate and required revision". 
Rather, in the part of the final determination  that the United  States  refers to, the USDOC simply 
stated that:  
We find that the errors and inconsistencies associated with the aforementioned analyses 
of Spec  D, Spec  H, and Spec  E sales, and of certain Spec  C sales, are such that the 
[USDOC]  should apply AFA  to this information .539  
Moreover, the United  States  explains that the "necessary" information that was missing due 
to Hyundai Steel 's misreporting was "the cost of manufacturing associated with certain products 
where product specifications were unverified ".540 Consistent with the United  States'  position, we note 
that, in its final calculation memorandum, the USDOC applied, as AFA, the "highest total cost of 
manufacturing (AVGTCOM ) from amongst the affected CONNUMs … along with the corresponding 
variable cos t of manufacturing … for the CONNUM with the highest reported AVGTCOM … to all of 
the affected CONNUMs".541  
After finding that Hyundai Steel had misreported product characteristics for certain Spec s D, 
E, and H sales, the USDOC revised the incorrect produc t characteristics using "facts otherwise 
available".542 Once the misreporting for product characteristics for certain sales was corrected – and 
the CONNUMs were revised accordingly – the USDOC provided no further explanation as to how this 
misreporting resulted in the absence of information concerning the cost  of manufacturing for the 
sales in the affected CONNUMs.  
 
535 CRS issues and decision memorandum, (Exhibit  KOR-41), p.  61. 
536 CRS issues and decision memorandum, (Exhibit  KOR-41), pp.  60-61. 
537 CRS final calculation memo, (Exhibit  KOR-49 (BCI)), p. 5. 
538 United  States'  response to Panel question No. 16(d), para.  76 (referring to CRS issues and decision 
memorandum, (Exhibit  KOR-41), p. 63 (emphasis added)).  
539 CRS issues and decision memorandum, ( Exhibit  KOR-41), p.  63. (emphasis added)  
540 United  States'  response to Panel question No.  16(a), para.  64 (referring to CRS issues and decision 
memorandum, (Exhibit  KOR-41), pp. 58-63; and CRS final calculation memo, (Exhibit  KOR-49 (BCI)) , pp. 5-6).  
541 CRS final calculation memo, (Exhibit  KOR-49 (BCI)), p. 5. 
542 CRS issues and decision memorandum, (Exhibit  KOR-41), pp. 60 -61. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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Article  6.8 is "not directed at mitigating the absence of 'any ' or 'unnecessary ' information, 
but is rather concerned with overcoming the absence of information required to complete a 
determination" .543 Under Article  6.8, "there has to be a connection between the 'necessary 
information ' that is missing and the particular 'facts available ' on which a determination … is 
based".544 In the case at hand, the misreported information concerned product characteristics for 
certain sales, but the USDOC resorted to the use of "facts available" not just for correcting this 
information for these sales, but also for determining the total cost of manufacturing for all other 
sales that were a part of the affected CONNUMs.545 Prior to resorting to the use of facts available 
with respect to the cost of manufacturing for all the affected CONNUMs, the USDOC did not explain 
why it considered that the c ost of manufacturing for the CONNUMs into which the sales at issue were 
reclassified was no longer accurate.  
With respect to the Spec s D, E, and H home market sales, we therefore find that the 
USDOC  acted inconsistently with Article  6.8 of the Anti -Dumpin g Agreement  in resorting to facts 
available in respect of  the cost of manufacturing for all the affected CONNUMs.  In light of our findings 
of WTO -inconsistency, we do not consider it necessary to rule upon Korea 's claims under 
paragraphs  3, 5, and 6 of Ann ex II to the Anti -Dumping  Agreement  in order to provide a positive 
solution to the dispute before us .546  
Spec C sales  
In relation to US sales, the USDOC found inconsistencies in the reporting of certain Spec  C 
sales during verification . Unlike the Spec s D, E, and H home market sales, for US sales under Spec  C 
the USDOC did not "correct" any "misreporting" by Hyundai Steel. Rather, the USDOC found these 
sales to be "unverified".547  
Korea argues that the Spec C sales identified by the USDOC were "insignifi cant" in 
comparison to the total number of transactions as they "represented only [[***]]% of total SPCC 
sales, or [[***]]% of total U.S. sales in the POI".548 On this basis, Korea asserts that this 
"information was not such that it could not be 'dispensed with or done without'" and was therefore 
not "necessary" for the USDOC 's margin calculation.549 We note, however, that, unlike home market 
sales where the USDOC assigned to all the affected CONNUMs the highest total cost of manufacturing 
for the CONNUMs in question, the USDOC resort to facts available in this instance was limited to the 
"the U .S. sales associated with the Spec C issue (which are limited to a small volume of U.S. sales 
of products classified under that specification and under the two other sp ecifications with comparable 
linking problems)".550 Given the limited "gap" sought to be filled by the USDOC, we agree with the 
United  States  that "Korea 's characterization of the magnitude of the erroneously reported 
information does not bear upon the nece ssity of the information".551 Besides the allegedly 
"insignificant" number of the transactions at issue, Korea does not offer any other reason as to why 
the information missing was not "necessary" for purposes of the USDOC 's determination within the 
meaning  of Article  6.8. We therefore find that Korea  has failed to establish  that the USDOC acted 
inconsistently with Article  6.8 of the Anti -Dumping  Agreement  because the Spec C sales at issue 
were "insignificant" in comparison to the total number of transaction s.  
We now turn to address Korea 's claims under paragraphs 3, 5, and 6 of Annex  II. Korea 
asserts that "Hyundai Steel explained from the outset of the investigation its reporting methodology 
and explained that there could be certain instances where the req uested CONNUM data and the 
internal company product codes for CEP sales might be different" .552 According to Korea, 
Hyundai  Steel was given "no opportunity to provide the information after the issue had been 
 
543 Appellate  Body Report, US – Carbon Steel (India) , para.  4.416. See also para. 7.28 above.  
544 Appellate  Body Report, US – Carbon Steel (India) , para.  4.416.  
545 CRS issues and decision memorandum, (Exhibit  KOR-41), p.  63. 
546 See, e.g. Panel Reports, EC – Salmon (Norway) , para.  7.387; and Morocco – Hot-Rolled Steel 
(Turkey) , paras.  7.105 -7.106.  
547 CRS issues and decision memorandum, (Exhibit  KOR-41), p.  62. 
548 Korea's  first written submission, paras.  275-276. 
549 Korea's  first written submission, para.  276. 
550 CRS issues and decision memorandum, (Exhibit  KOR-41), p.  63. 
551 United  States'  response to Panel question No. 16(b), para.  72. 
552 Korea's  first written submission, para.  297. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  identified by the USDOC and all of the explanations that were provided in the case briefs were 
effectively ignored".553 
Following the USDOC 's discovery of certain inconsistencies in the reporting of Spec C sales 
at verification, Hyundai Steel consistently asserted that it had correctly reported the quality of the 
products. Hyundai Steel explained that regarding the "type 2b" transaction, it had properly reported 
the characteristic of the product as produced and imported.554 Regarding the "type 3" transactions, 
Hyundai Steel explained that there wa s no flaw in its reporting; rather, the inconsistency in the 
reported quality occurred because, in certain instances, HSA had actually sold a coil product of higher 
quality rather than the one ordered and imported for this order.555 Hyundai Steel further st ated that 
while the "type 3" transactions concern instances where "a single coil was sold as multiple products", 
there might be other instances as well where the PRODCOD2U did not match the QUALITYU, such 
as the imported coil being processed and sold under  a different specification. According to 
Hyundai  Steel, none of these instances would result in an error of the quality reporting, which was 
always based on the imported coil.556  
Contrary to Korea 's assertion that the USDOC "effectively ignored" the explan ations provided 
by Hyundai Steel in its case and rebuttal briefs, the USDOC expressly considered 
Hyundai  Steel's explanation and found it to be lacking :  
Hyundai Steel argues this variation is not due to some type of classification error, but, 
rather, that  it is due to certain products being sold to the final customer as specifications 
requiring less stringent requirements than the specifications to which the products were 
actually made. It is not evident from the record which, if any, of the Hyundai Steel 
specifications in question are more or less stringent than the others, with respect to 
requirements.557 
Although the explanations provided by Hyundai Steel during and after verification may have 
helped explain why the reporting inconsistencies identified by  the USDOC could exist, e.g. in light of 
the alleged "linking" problem, Korea does not identify any evidence or explanations provided by 
Hyundai Steel in order to establish that, despite these inconsistencies, it, in fact, "correctly reported 
the product c haracteristics based on the Hyundai Steel imported coil ( i.e., the actual physical 
characteristics of the steel)" for all the sales at issue .558 Thus, even in light of the explanation offered 
by Hyundai Steel for the identified inconsistencies, there was no  way for the USDOC to confirm the 
accuracy of the product characteristics that were actually reported by Hyundai  Steel.  
Furthermore, in addressing Hyundai Steel 's explanations, the USDOC in its final 
determination  also observed that during "the Hyundai Steel sales verification the company had 
stated that 'HSA did not intentionally alter or revise the specification and grade designations from 
those of the original coil it purchased from Hyundai Steel'" .559 Korea does  not take issue with this 
observation. In light of these facts, we find that the USDOC reasonably concluded that it could not 
verify the accuracy of information for the sales at issue .560  
As we have explained above561, paragraph  3 of Annex  II constitutes the "substantive basis" 
for an investigating authority 's rejection of information provided by a respondent and its resort to 
 
553 Korea's  first written submission, para.  282. 
554 CRS case brief, (Exhibit  KOR-48 (BCI)), p.  11. 
555 CRS rebuttal brief, (Exhibit  KOR-29 (BCI)), p.  13. 
556 CRS rebuttal brief, (Exhibit  KOR-29 (BCI)), p.  14. 
557 CRS issues and decision memorandum, (Exhibit  KOR-41), p.  62. (emphasis added)  
558 CRS Rebuttal brief, (Exhibit  KOR-29 (BCI)), p. 13. For one sale examined during verification 
(surprise US sale 3) the USDOC verification report  states that HSA provided "additional detail to explain why" it 
identified the sale with a different product code. The verification report states that HSA was able to link the 
merchandise it sold to the "original Hyundai Steel coil but not to an HSA produc tion order, and in this instance , 
the original Hyundai Steel coil was cold rolled" and classified with the relevant production code. (CRS HSA sales 
verification report, (Exhibit  KOR-46 (BCI)), p.  13 (emphasis added)). In our view, even if this explanation 
provided by HSA supported Korea's  assertion that the USDOC "effectively ignored" the explanations provided 
by Hyundai Steel in its case and rebuttal briefs, it does not remedy the deficiency identified by the USDOC, 
namely that it was not able to verify th e accuracy of the product characteristics reported by Hyundai Steel.  
559 CRS issues and decision memorandum, (Exhibit  KOR-41), p.  62. 
560 CRS issues and decision memorandum, (Exhibit  KOR-41), p.  62. 
561 See paras.  7.138 -7.139  above.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  facts available.562 Under paragraph  3, an investigating authority shall take into account information 
submitted by an in terested party when it is verifiable, appropriately submitted so it can be used 
without undue difficulties, and furnished in a timely fashion. For the reasons set out above, we find 
that the USDOC properly concluded that the information at issue was not ve rifiable and could not be 
used for its determination. We therefore  find that Korea has failed to establish that the USDOC  acted 
inconsistently with paragraph  3 of Annex  II to the Anti -Dumping  Agreement  in resort ing to facts 
available with respect to the Sp ec C sales at issue.  
Korea also claims that the USDOC acted inconsistently with paragraph  5 of Annex  II, which 
provides that : 
Even though the information provided may not be ideal in all respects, this should not 
justify the authorities from disregarding it, provided the interested party has acted to 
the best of its ability.  
Taken together, paragraphs 3 and 5 establish an obligation for an investigating authority to ensure 
that information that is "not ideal in all respects" must not be considered unverif iable because of its 
flaws, so long as the interested party submitting it has acted to the "best of its ability".563 However, 
this does not mean that information that is not verifiable (or does not meet the other criteria in 
paragraph  3) must nonetheless be  used by an investigating authority if the interested party acted 
to the best of its ability.564 In this regard, we agree with the panel in US – Steel Plate  that "it [is] 
difficult to conclude that an investigating authority must use information which is, f or example, not 
verifiable, or not submitted in a timely fashion, or regardless of the difficulties incumbent upon its 
use, merely because the party supplying it has acted to the best of its ability" .565 Having already 
found that the USDOC properly conclude d that the information at issue was not verifiable – and even 
if Hyundai Steel is seen as having acted to the best of its abilit y – the USDOC was not required by 
paragraph  5 to use that information. Accordingly, in the circumstances of this case, we find that 
Korea has failed to establish that the USDOC acted inconsistently with paragraph  5 of Annex  II in 
resorting to the use of facts available with respect to the Spec C sales at issue .  
As discussed above, Hyunda i Steel provided explanations to the USDOC on this issue during 
verification, as well as part of its case and rebuttal briefs.566 The record indicates that the USDOC 
properly engaged with these explanations, but found them to be insufficient for purposes of  verifying 
the accuracy of the reported information.  We therefore find that Korea has not establish ed that the 
USDOC acted inconsistently with paragraph  6 of Annex  II to the Anti -Dumping  Agreement  in 
resorting to facts available with respect to the Spec C sales at issue.  
7.3.2.3.3.2   The USDOC 's selection of the replacement facts  
We have already found that the USDOC erred in resorting to facts available with respect to 
Specs D, E, and H home market sales. In these circumstances, we do not consider that making 
further findings on Korea 's claims concerning the USDOC 's selection of the replacement facts on the 
basis of the record used for the USDOC 's WTO-inconsistent findings would assist in providing a 
positive solution to the dispute before us.567 However, given our findings that Korea has failed to 
establish that the USDOC erred in resorting to facts available with respect to the information 
concerning Spec  C sales, it is necessary for us to address Korea 's claims aimed at  the 
USDOC 's selection of the replacement fac ts in relation to these sales.  
Korea argues that there is no evidence that the USDOC engaged in any "process" in selecting 
the replacement information.568 According to Korea, there were many different kinds of data 
available to the USDOC to use rather than the highest calculated dumping margin for US sales.569 
 
562 Panel Report, Egypt – Steel Rebar , para.  7.159.  
563 See for example, Panel Report, Egypt – Steel Rebar , para.  7.161.  
564 Panel Report, US – Steel Plate , para.  7.65. 
565 See Panel Report, US – Steel Plate , para.  7.64. 
566 See paras.  7.144 -7.146  above.  
567 See, e.g. Panel Reports, Egypt – Steel Rebar , para.  7.310; Mexico – Anti-Dumping Measures on Rice , 
para. 7.200. See also Panel Report, China – Broiler Products , para. 7.555.  
568 Korea's  first written submission, para.  322. 
569 Korea's  response to Panel question No.  16(f), p.  17. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  Korea also argues that the selected information was chosen for the sole reason that it was the 
highest calculated margin for any US sale, irrespective of its aberrational nature.570 
As discussed above, Article 6.8 requires investigating authorities to select reasonable 
replacements for the missing "necessary" information.571 In selecting such reasonable replacements, 
an investigating authority must take into account all the facts that are properly availabl e to it. 
Whether the sales used to generate the highest margin were, as a matter of fact, aberrational, is a 
subsidiary issue to whether the USDOC considered all information on the record. For US sales 
associated with the Spec C issue, the USDOC assigned t he highest calculated margin for any other 
reported US sale of Hyundai Steel, [[***]]%.572 This margin was one of many resulting from a 
multitude of US sales.573 When faced with such a range of margins, an objective and unbiased 
investigating authority is re quired to explain why the highest  margin was a reasonable replacement 
for the missing necessary information. The USDOC 's issues and decision  memorandum does not 
contain any evidence of a process of reasoning and evaluation indicating that it took into acco unt 
the various margins that were available to it. The USDOC found:  
These are problems involving products analyzed during verification, and for which 
Hyundai Steel had no plausible explanation either at verification or in its case and 
rebuttal briefs for m isidentifying these sales, as discussed above. Accordingly, the 
[USDOC]  finds that under section  776(b ) of the Act, Hyundai [Steel] did not cooperate 
to the best of its ability with regard to this information, and  finds it necessary to apply 
an adverse inference.574 
The only explanation offered by the USDOC was that an adverse inference was warranted in 
light of Hyundai  Steel's non-cooperation. The USDOC provided no other evidentiary basis in support 
of its selection of the replacement facts  with respect the Spec C sales . In the circumstances of this 
case, we  consider that Hyundai Steel 's non-cooperation cannot alone constitute the sole basis for 
the selection of the replacement facts.575 
We therefore find tha t the USDOC acted inconsistently with Article  6.8 of the 
Anti-Dumping  Agreement  in selecting the replacement facts for the Spec C sales at issue by failing 
to take into account all the information that was properly before it. In light of our finding of 
WTO-inconsistency, we do not consider it necessary to rule upon Korea 's claim under paragraph  7 
of Annex  II to the Anti -Dumping  Agreement  in order to provide a positive solution to the dispute 
before us .  
Korea 's claims under Articles  1, 9.3, and 18.1 of the Anti-Dumping  Agreement  
Korea further claims that the USDOC 's use of facts available inconsistently with Article  6.8 
and Annex  II of the Anti -Dumping  Agreement  "led to an anti -dumping duty that was imposed and 
collected in excess of the margins of dumping in violation of Articles  1, 9.3, and 18.1 of the 
Anti-Dumping  Agreement ".576 According to Korea, because the margin of dumping was determined 
based on facts available in a manne r inconsistent with Article  6.8 and Annex  II, "the imposition of 
duties at the level of the margin of dumping automatically violated Article  9.3".577 Moreover, Korea 
asserts that the violation of Article  6.8 and Annex  II also "automatically leads" to a viol ation of 
Articles  1 and 18.1 of the Anti -Dumping  Agreement , as "this USDOC investigation and the measure 
taken were not in accordance with the Anti -Dumping  Agreement ".578  
The United  States  responds that Korea 's claims under Articles  1, 9.3 , and 18.1 are "e ntirely 
consequential" and "Korea offers no argument or evidence to support any independent breach of 
 
570 Korea's  first written submission, para.  326. 
571 See para.  7.36 above.  
572 CRS issues and decision memorandum, (Exhibit  KOR-41), p. 63; CRS final calculation memo, 
(Exhibit  KOR-49 (BCI)), p. 6. 
573 Korea's  response to Panel question No.  16(f), p.  19 (referring to CRS final redetermination, 
(Exhibit  KOR-227 (BCI)), pp.  6-7). 
574 CRS issues and decision memorandum, (Exhibit  KOR-41), p. 63. 
575 See para.  7.35 above. See also Panel Report, China – GOES , para.  7.302.  
576 Korea's  first written submissio n, para.  334. 
577 Korea's  first written submission, paras.  331-332. 
578 Korea's  first written submission, para.  333. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  those provisions".579 According to the United  States , were the Panel to uphold Korea 's claims under 
Article  6.8 and Annex  II, "there would be no basis to d ecide Korea 's consequential claims".580 First, 
the United  States  "does not concede that such breaches are 'automatic'".581 Second, the 
United  States  submits that deciding such claims would be serve "no useful purpose" and would 
provide no "additional guidanc e that would be useful regarding implementation of any 
recommendations adopted by the DSB".582 
Korea does not present any independent bases for the alleged breaches of Articles  1, 9.3, 
and 18.1 of the Anti -Dumping  Agreement ; instead, its claims under these provisions  are dependent 
entirely upon a finding that the United  States  acted inconsistently with Article  6.8 and Annex  II of 
the Anti -Dumping  Agreement .583 In these circumstances – and having already found that the 
United  States  acted inconsistently with Article  6.8 and paragraph  3 of Annex  II – we do not consider 
it necessary to rule upon Korea 's claims under Articles  1, 9.3, and 18.1  of the 
Anti-Dumping  Agreement  in order to resolve the dispute before us.584 
7.3.3   Anti-dumping duties on certain hot -rolled steel flat products from Korea 
(USDOC  investigation number A -580-883)  
Introduction  
Korea claims that the United  States  acted inconsistently with Article  6.8 and Annex  II to the 
Anti-Dumping  Agreement  in the investigation concerning certain hot -rolled steel  (HRS) flat products 
from Korea (the "HRS AD investigation").585 Similar to its claims concerning affiliated party 
transactions in the CRS  AD investigation, Korea challenges the USDOC 's use of facts available due 
to the alleged failure of Hyundai Steel to demonstrate the arm's -length nature of certain services 
provided by its affiliates [[***]] and [[***]].586 Korea asserts that the USDOC 's improper use of 
"partial AFA" resulted in a dumping margin in the final determination, which was more than double 
the d umping margin in the preliminary determination – an increase from 3.97% to 9.49% – and 
demonstrates the "punitive" nature of the USDOC 's selection of the replacement facts.587  
We begin by setting out the relevant factual background of the underlying invest igation. 
Subsequently, we summarize the parties ' arguments before examining Korea 's claims of 
WTO-inconsistency in respect of the USDOC 's resort to and selection of the replacement facts.  
Factual background  
The USDOC in its initial questionnaire requested Hyundai Steel to "[p]repare only a single 
response for [itself and its] affiliates  involved with the production or sale of the products under 
investigation during the period of investigation  (POI) in the foreign market or the United  States ".588 
In response,  Hyundai Steel responded  that it was affiliated to [[***]], based on their common 
membership of the Hyundai Motor Group.589 Hyundai Steel also identified [[***]], as a company 
"[[***]]".590 
In response to Section B of the initial questionnaire, Hyundai Steel reported certain 
movement expenses for its home market sale s. With respect to inland freight to warehouse, Hyundai 
Steel stated that during the POI it used [[***]] for these services, and provided a sample calculation 
worksheet for the reported costs.591 Regarding warehousing services , Hyundai Steel noted that it 
 
579 United  States'  first written submission, para.  356. 
580 United  States'  first written submission, para.  358. 
581 United  States'  first written subm ission, para.  358. 
582 United  States'  first written submission, paras.  358-359. 
583 Korea's  first written submission, paras.  332-333. 
584 See, e.g. Panel Reports, US – Differential Pricing Methodology , paras.  7.114 -7.115; Argentina – 
Poultry Anti -Dumping Duties , para.  7.369;  US – Steel Plate , para.  7.103; and EU – Footwear (China) , 
para. 7.935.  
585 Korea's  first written submission, para.  458. 
586 Korea's  first written submission, paras.  467-469. 
587 Korea's  first written submission, para.  517. 
588 HRS initial ques tionnaire,  (Exhibit  KOR-58 (BCI)), p.  G-10. (emphasis original)  
589 HRS Section A questionnaire response,  (Exhibit  KOR-55 (BCI)), p.  A-11. 
590 HRS Section A questionnaire response,  (Exhibit  KOR-55 (BCI)), p.  A-14. 
591 HRS Sections B -C questionnaire response,  (Exhibit KOR-56 (BCI)), p.  B-29. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 77 - 
 
  received services mostly from its affiliate [[***]], except for certain HRS products ("PO products"), 
for which it also transacted with an unaffiliated supplier ( [[***]]).592 Hyundai Steel submitted copies 
of contracts with this unaffiliated supplier and with its affiliated supplier, alleging that warehousing 
transactions with [[***]] were at arm 's length.593 With respect to inland freight to customer , 
Hyundai Steel stated that it does not use unaffiliated freight companies for similar services, and was 
therefore unable to provide comparable prices from unaffiliated vendors "for comparison".594 
Hyundai Steel prov ided a calculation of its expenses and a copy of its freight contract with [[***]] 
supporting the per unit expense amount595, along with an excerpt from [[***]] financial statement, 
allegedly demonstrating that [[***]] earned profit during the POI, and ther efore that it engaged in 
arm's -length transactions with Hyundai Steel.596 
In response to Section C of the initial questionnaire concerning sales to the United  States , 
Hyundai Steel stated that [[***]] also provided domestic freight services from plant/wareh ouse to 
port.597 Hyundai Steel explained that these transactions were at arm 's length due to [[***]] 
operating profits for inland freight services that were discussed under its Section B response.598 With 
respect to international freight , Hyundai Steel stated that "[d]uring the POI, [[***]] provided all 
shipping services for subject merchandise".599 Regarding marine insurance , it submitted a sample 
calculation worksheet for the related costs, along with certain invoices.600 
In its supplemental questionnair e dated 23 December 2015, the USDOC noted that the net 
profit information provided for [[***]] in the initial response did not show that [[***]] earned a 
profit from its freight and warehousing services, or from non -operating income, and asked 
Hyundai  Steel to demonstrate that the freight and warehousing rates charged by [[***]] were at 
arm's length.601 Hyundai Steel provided a "representative sample" of [[***]] freight contracts with 
one of its unaffiliated subcontractors, [[***]]602, which also included war ehousing services.603 For 
Hyundai Steel, a comparison between the [[***]]-[[***]] contract and the Hyundai Steel -[[***]] 
contract604 demonstrated that [[***]] charged Hyundai Steel higher prices than the amount [[***]] 
paid to its subcontractor, thus indicating that these services were negotiated at an arm's -length 
basis.605 Regarding international freight expenses  for US sales, the USDOC requested Hyundai Steel 
to provide "copies of : (a) the ocean freight contract between Hyundai Steel and [[***]], and  
(b) international freight contracts between [[***]] and the provider of the ocean freight services".606 
Hyundai Steel submitted its contract with [[***]] and a contract between [[***]] and its 
subcontractor [[***]], allegedly demonstrating that [[***]] made a profit on the services it provided 
to Hyundai Steel.607  
At verification, as part of its "completeness test"608, the USDOC requested comparative 
inland and ocean freight  charge information between [[***]] and other unaffiliated parties in order 
to verify  the arm 's-length nature of transactions between the two affiliated companies. The USDOC 
recalled that " [[***]]'s two largest shareholders are [[***]], and are also the part owner and 
 
592 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-30. 
593 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-30 and exhibit  B-14.  
594 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-31. 
595 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), exhibits  B-14 and B -16. 
596 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), pp.  B-28-B-31 and exhibit  B-17.  
597 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  C-28. 
598 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  C-28. 
599 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  C-30. 
600 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  C-30 and exhibit  C-14. 
601 HRS supplemental Sections A -C questionnaire,  (Exhibit  USA-20 (BCI)), pp.  16-17. 
602 HRS supplemental Sections A -C questionnaire response,  (Exhibit  KOR-59 (BCI)), pp.  31, 33, and 45 
and exhibit  S-38. 
603 HRS s upplemental Sections A -C questionnaire response,  (Exhibit  KOR-59 (BCI)), p.  32. 
604 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), exhibit  B-16. 
605 HRS supplemental Sections A -C questionnaire response,  (Exhibit  KOR-59 (BCI)), pp.  31-33 and 46 
and exhibit  S-38. 
606 HRS supplemental Sections A -C questionnaire,  (Exhibit  USA-20 (BCI)), p.  25. 
607 HRS supplemental Sections A -C questionnaire response,  (Exhibit  KOR-59 (BCI)), p.  48 and 
exhibits  S-59-S-60. 
608 The USDOC describes "completeness" as "th e process which confirms the accuracy and thoroughness 
of reported sales and expenses", and among the sales items selected were the ocean freight for US sales and 
the inland freight for home market sales performed by [[ ***]], and the marine insurance servi ces provided 
by [[***]]. (HRS verification report,  (Exhibit  KOR-57 (BCI)), pp.  14-15). WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  Vice Chairman of Hyundai Steel, respectively".609 Hyundai Steel maintained that it could not 
"compel" [[***]] to provide this data "despite the ownership, managerial, and familial affiliations 
between the two companies".610 Hyundai Steel provided a similar response to the USDOC 's request 
for comparative marine insurance  rates between its affiliate, [[***]], and other unaffiliated 
parties.611 Hyundai Steel provided instead an invoice from an unaffiliated marine insurance supplier, 
[[***]], arguing that the rate charged by the unaffiliated supplier was lower than that of [[***]].612 
The USDOC issued its final determination on 12 August 2016613, wherein it focused on the 
issue of the affiliation between Hyundai Steel and the two companies and found that Hyundai Steel 
and the two companies were "held and commonly controlled by the same family members during 
the POI".614 It also found that "Hyundai Steel failed the completeness portion at verification with 
regard to this issue, i.e., failed to demonstrate the arm's -length nature of these services provided 
by the affiliated companies". The USDOC thus considered information concerning these transactions 
as "necessary information" that was "not on the record due to Hyundai Steel 's failure to provide it", 
and on this basis decided to rely on facts available.615 The USDOC also decided to apply facts 
available with an "adverse inference" due to Hyundai Steel 's failure to cooperate by not acting to 
the best of its ability.616 For its final determination, the USDOC selected replacement facts for home 
market inland freight and warehousing by applying the lowest reported values, and for marine 
insurance, international freight, and inland freight for US sales by applying the highe st reported 
values.617 
Main arguments of the parties  
Korea claims that the USDOC resorted to the use of facts available inconsistently with 
Article  6.8 of the Anti -Dumping  Agreement  because there was no "necessary" information that was 
missing618, and becaus e Hyundai Steel did not "significantly impede []" the investigation.619 Korea 
argues that no "necessary" information was missing as Hyundai Steel provided all requested sales 
and cost information about its affiliated service providers in an accurate and time ly manner , and 
that the USDOC did not find any deficiencies with respect to this information during verification.620 
Korea contends that the USDOC, in  Section D of its initial questionnaire, directed Hyundai Steel to 
demonstrate the arm 's-length nature of i ts affiliated transactions based on three types of 
information, requested in the alternative, and that Hyundai Steel responded in light of these 
instructions.621 Korea argues that the information regarding sales of Hyundai Steel 's affiliates to 
unaffiliated  customers was not "necessary" and was never requested prior to verification.622 Korea 
also notes that, prior to verification, the USDOC focused properly on the nature of the actual 
transactions between Hyundai  Steel and its affiliates.623 Korea argues that Hyundai Steel did not 
"significantly impede" the investigation as the USDOC 's request for information was "unreasonable" 
and was tantamount to a surprise and extensive request for information at the last minute.624 Korea 
states that Hyundai  Steel could not have been held responsible for not providing information that 
 
609 HRS verification report,  (Exhibit  KOR-57 (BCI)), p.  14. 
610 HRS verification report,  (Exhibit  KOR-57 (BCI)), p.  14. 
611 HRS verification report,  (Exhibit  KOR-57 (BCI)), p.  15. 
612 HRS verification report,  (Exhibit  KOR-57 (BCI)), pp.  14-15 and exhibit  HS-36. See also HRS case 
brief, (Exhibit  KOR-65 (BCI)), pp.  9-10. 
613 HRS AD final determination, (Exhibit KOR -53). The underlying issues and decision memorandum was 
issued on 4 Au gust 2016. (HRS issues and decision memorandum, (Exhibit KOR -67)). 
614 HRS issues and decision memorandum,  (Exhibit  KOR-67), p.  19. 
615 HRS issues and decision memorandum,  (Exhibit  KOR-67), p.  19. 
616 HRS issues and decision memorandum,  (Exhibit  KOR-67), p.  19.  
617 HRS issues and decision memorandum,  (Exhibit  KOR-67), pp.  19-20. 
618 Korea's  first written submission, para.  487. 
619 Korea's  first written submission, para.  491. 
620 Korea's  first written submission, paras.  487-488. Specifically, Korea asserts th at it provided the 
following information to demonstrate the arm's -length nature of transactions:  (a) for inland freight and 
warehousing, it showed that [[ ***]] passed on the full costs, plus an amount to cover expenses and profit, to 
Hyundai Steel; (b)  for ocean freight, it demonstrated that the charges by [[ ***]] were comparable to those 
charged by an unaffiliated carrier; and (c)   for marine insurance, it offered evidence indicating that the 
premium rate charged by [[ ***]] was higher than the rate charged  by an unaffiliated provider. 
(Ibid.  para. 487).  
621 Korea's  first written submission, paras.  470-471 and 480 (referring to HRS initial questionnaire,  
(Exhibit  KOR-58 (BCI)), pp.  D-4-D-5). 
622 Korea's  first written submission, para.  489. 
623 Korea's  first writte n submission, para.  489. 
624 Korea's  first written submission, paras.  491-493. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  was not within its control, and since the requested information was held by a legally separate – 
albeit affiliated – company, Hyundai  Steel could not be considered to have significantly impeded the 
investigation.625 Korea points out that , had Hyundai Steel 's affiliates provided the requested 
information, they could have been exposed to various legal liabilities, such as those for breach of a 
duty of confidentiality.626 
Korea further claims that the  USDOC acted inconsistently with paragraph  1 of Annex  II 
because it failed to specify in detail the required information as soon as possible after the initiation 
of the investigation.627 Korea contends that , at verification,  the USDOC  "suddenly" requested certain 
informat ion that was not within Hyundai Steel 's control.628 In addition, Korea claims that the USDOC 
acted inconsistently with paragraph  6 of Annex  II because it rejected the information provided on 
the arm 's-length nature of s ervices without previously informing and giving Hyundai Steel an 
adequate opportunity to provide further explanations, and without subsequently setting out in its 
published determination the reasons of rejection of such information.629  
Korea also claims th at the USDOC  acted inconsistently with paragraph  3 of Annex  II because 
the USDOC rejected "all information previously submitted", even though such information was 
verifiable and substantiated, and  was, in fact , actually verified by the USDOC.630 Finally, Ko rea claims 
that the USDOC acted inconsistently with paragraph  5 of Annex  II, as the information provided by 
Hyundai  Steel, even if not ideal in all aspects, was provided  by Hyundai Steel acting  to the best of 
its ability.631  
As to the selection of the repl acement facts, Korea claims that the USDOC acted 
inconsistently with Article  6.8 and paragraph  7 of Annex  II.632 According to Korea, there was no 
process of reasoning and evaluation by the USDOC as to how or why the facts employed by the 
USDOC were reasonab le replacements for the missing information.633 Korea argues that the USDOC 
failed to exercise "the requisite caution" in selecting facts available.634 Korea contends that the sole 
basis for the USDOC 's selection of the replacement facts was to ensure "an ad verse inference", and 
that the USDOC simply took the highest and lowest values to increase normal value and reduce the 
export price, thus ensuring that the dumping margin was the highest that it could be.635 The selection 
of facts available was punitive in nature, and was even applied to transaction s that the USDOC had 
verified as being at arm's length.636 Korea contends that the USDOC failed to corroborate properly 
the selected information and thus failed to ensure that this information was a reasonable 
replacement.637 Korea argues that the USDOC could  have sought to fill any supposed gap with 
specific information, for example, by adjusting all allegedly problematic service values by applying 
a variance factor to inflate or deflate the transaction values to arm 's-length levels.638 
The United  States  responds that the USDOC reasonably determined that it was appropriate 
to resort to facts available due to Hyundai Steel 's failure to provide necessary information desp ite 
the USDOC 's numerous requests.639 Acknowledging that Hyundai Steel had provided "some 
supporting documentation" to demonstrate that transactions with its affiliates were at 
arm's length640, the United  States  argues that the USDOC nonetheless "did not hav e enough 
information on the record to establish" the arm 's-length nature of the transactions at stake and that 
Korea has not demonstrated that the requested (missing ) information at issue was not 
"necessary".641 In addition, the United  States  argues that Hy undai Steel did not explain its inability 
to obtain the information the USDOC needed to establish the nature of the transactions between 
 
625 Korea's  second written submission, para.  205. 
626 Korea's  second written submission, para.  207. 
627 Korea's  first written submission, para.  494. 
628 Korea's  first written submission, para.  496. 
629 Korea's  first written submission, para.  497. 
630 Korea's  first written submission, para.  502. 
631 Korea's  first written submission, para.  503. 
632 Korea's  first written submission, para.  507. 
633 Korea's  first writte n submission, paras.  507 and 509.  
634 Korea's  first written submission, paras.  510-512. 
635 Korea's  first written submission, paras.  507 and 509.  
636 Korea's  first written submission, paras.  513 and 516.  
637 Korea's  first written submission, para.  515. 
638 Korea's  first written submission, para.  516. 
639 United  States'  first written submission, para.  146. 
640 United  States'  first written submission, para.  139. 
641 United  States'  first written submission, para.  150. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 80 - 
 
  Hyundai Steel and [[***]]. According to the United  States , the issue is not the legal separation 
between the two compan ies, but rather the affiliation deriving from the close relationship between 
Hyundai Steel 's management and [[***]] two largest shareholders, as well as the common 
membership in a "group".642 According to the United  States , Korea makes a post hoc argument when 
suggesting that Hyundai Steel could not gain access to the requested documents due to 
confidentiality and fiduc iary concerns and [[***]] obligations under Korean law, an argument that 
was never made by Hyundai Steel before the USDOC .643 
The United  States  further  responds that Korea has not demonstrated that the 
USDOC 's resort to facts available is inconsistent with paragraphs 1 and 6 of Annex  II. According to 
the United  States , the USDOC notified Hyundai Steel early on in the investigation that information 
relating to Hyundai  Steel's transactions with its affiliates would be requested and made an additional 
request w hen it determined that it needed further information to evaluate the nature of these 
transactions.644 The United  States  alleges that the number of times that Hyundai Steel was asked to 
provide information on its transactions with its affiliates is not compa tible with Korea's  claim that 
Hyundai Steel was not informed as soon as possible for the required information and was not allowed 
a reasonable period of time to respond to these requests.645  
With respect to Korea 's claim under paragraph  3 of Annex  II, the United  States  responds 
that because Hyundai Steel failed to provide the requested documents, the USDOC did not have the 
opportunity to examine the accuracy and reliability of the information already submitted and verify 
whether the affiliated parties ' transactions were at arm 's length.646 In addition, the United  States  
argues that since the information submitted by Hyundai Steel did not satisfy the conditions of 
paragraph  3, it falls outside the ambit of paragraph  5, but , in any event, Hyundai Steel did not act 
to the best of its ability by failing to submit the requested information despite being afforded multiple 
opportunities.647 
Regarding the selection of replacement facts, the United  States  responds that the USDOC 
engaged in a careful assessment of the missing necessary information and reasonably decided to 
rely on Hyundai Steel 's own reported data.648 According to the United  States  – besides  expressing 
its dissatisfaction with the selected r eplacements – Korea has not explained why the 
USDOC 's process for selecting the replacement facts is inconsistent with any specific provision of the 
Anti-Dumping  Agreement .649 The United  States  explains that the USDOC did not reject all of 
Hyundai  Steel's expense data, but disregarded only certain information relating to 
Hyundai  Steel's affiliated service providers and replaced those missing values with other expense 
values reported by Hyundai Steel.650 Korea 's characterization of the replacements as arbitrar y and 
punitive is, according to the United  States , "meritless ".651 Finally, the United  States  asserts that 
Korea 's claim that the USDOC did not use special circumspection fails as it does not explain its 
argument.652  
Evaluation by the Panel  
7.3.3.4.1   The USDOC 's resort to facts available  
While many aspects of Korea 's claims under Article  6.8 and paragraphs 1, 3, 5, and 6 of 
Annex II of the Anti -Dumping  Agreement relating to this investigation are similar to its claims 
concerning the affiliated -party transactions issue in the CRS AD investigation , the two investigations  
also differ in important ways. Unlike the CRS AD investigation, where its findings concerned one 
affiliated company ( [[***]]), the USDOC 's findings in the HRS AD investigation concern that same 
company and one other affiliated company, namely, [[***]]. Furthermore, the specific information 
 
642 United  States'  first written submission, paras.  156-157. 
643 United  States'  second written submission, paras.  57-58. 
644 United  States'  first written submission, paras.  153-154 (referring to HRS supplemental Sections A -C 
questionnaire,  (Exhibit  USA-20 (BCI)), pp. 16-17). 
645 United  States'  first written submission, para.  155. 
646 United  States'  first written submission, para.  172. 
647 United  States'  first written submission, para.  176. 
648 United  States'  first written submission, para.  183. 
649 United  States'  first written submission , para.  184. 
650 United  States'  first written submission, para.  187. 
651 United  States'  first written submission, para.  190. 
652 United  States'  first written submission, para.  191. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 81 - 
 
  requested by the USDOC, as well as the timing of the USDOC 's requests, differ between the two 
investigations.  In accordance with the proper standard o f review,  these differences require us to  
examine the WTO -consistency of the USDOC 's conduct in light of the specific facts and circumstances 
of the HRS AD investigation.  
Insofar as Korea alleges that the USDOC 's Section D questionnaire provided three alte rnative 
ways of establishing the arm's -length nature of the transactions between Hyundai Steel and its 
affiliates653, [[***]] and [[***]], the part of the Section D questionnaire that Korea relies upon is 
expressly limited to the reporting of " major  inputs purchased from affiliated parties that are used to 
produce the merchandise under consideration".654 Korea does not argue that the services supplied 
by [[***]] and [[***]] constituted "major inputs" for Hyundai Steel 's production of HRS. In these 
circumstances, we find the "guidance"655 provided by the USDOC as part of its Section  D 
questionnaire to be of limited relevance for Hyundai Steel 's reporting of the non -major inputs 
sourced from the affiliated parties at issue. Accordingly, we examine the questions that were, in 
fact, posed by the USDOC concerning the arm's -length nature of the services provided by 
Hyundai  Steel's affiliates [[***]] and [[***]]. 
In Section A of  its initial questionnaire , the USDOC inquired about the corporate and legal 
structure of "any parent companies and subsidiaries of [the] company and all other persons affiliated 
with [the] company and provide a description of all such persons".656 Hyundai Steel in its response 
identified [[***]] as its affiliate, noting that their [[***]].657 Hyundai Steel explained that [[***]] 
"transported finished hot -rolled steel from Hyundai Steel 's facilities to domestic customers (for home 
market sales ) and the port ( for export sales), and also provided international shipping (including 
wharfage ) for export sales".658 Hyundai Steel further identified [[***]] as an affiliated provider of 
marine " [[***]]" "[[***]]".659 Hyundai Steel described the operational relationship b etween the 
members of the Hyundai Motor Group as sharing a single director [[***]], as well as being 
"common [ly] control [led]" through the Hyundai  Motor Group and its chairman, [[***]] (father of 
[[***]]).660 [[***]] was also identified as the second largest stockholder of Hyundai Steel 
(of 11.84%).661 Hyundai Steel stated that it would "demonstrate in its forthcoming Sections B -C 
responses that transactions with affiliated service providers are at arm 's length".662 
Section B of the USDOC 's questionnaire concerned "[s]ales in the [h]ome [m]arket or to a 
[t]hird [c]ountry"663, while Section C required information concerning "[s]ales to the 
United  States ".664 Under Section B – for home market sales – the USDOC required Hyund ai Steel to 
report certain "movement expenses", including those incurred for "inland freight" from "plant to 
distribution warehouse"665, "warehousing"666, and "inland freight" from "plant/warehouse to 
customer".667 The USDOC 's instructions required Hyundai St eel to also identify any "affiliations" with 
the service providers and to "describe the nature of the affiliation".668 
Hyundai Steel respond ed that, for inland freight from plant to warehouse, it used [[***]] 
"to transport merchandise [i.e. finished coils] to offsite facilities" during the POI.669 Hyundai  Steel 
stated that it would demonstrate that "the rates paid to this company represent arm 's length prices" 
 
653 Korea's  first written submission, paras.  470-471. 
654 HRS initial questionnaire,  (Exhibit  KOR-58 (BCI)), p.  D-4 (emphasis original). The 
USDOC's  questionnaire defines a "major input" as "an essential component of the finished merchandise which 
accounts for a significant percentage of the total cost of manufacturing incurred to produce one unit of the 
merchandise under consideration". (Ibid.).  
655 Korea's  first written submission, para.  471. 
656 HRS initial questionnaire,  (Exhibit  KOR-58 (BCI)), p.  A-4. 
657 HRS Section A questionnaire response,  (Exhibit  KOR-55 (BCI)), p.  A-11. 
658 HRS Section A questionnaire response,  (Exhibit  KOR-55 (BCI)), p.  A-11. See also HRS Sections B -C 
questionnaire response,  (Exhibit  KOR-56 (BCI)), pp.  B-29-B-30. 
659 HRS Section A questionnaire response,  (Exhibit  KOR-55 (BCI)), p.  A-14. 
660 HRS Section A questionnaire response,  (Exhibit  KOR-55 (BCI)), p.  A-10. 
661 HRS Section A questionnaire response,  (Exhibit  KOR-55 (BCI)), exhibit  A-8. 
662 HRS Section A questionnaire response,  (Exhibit  KOR-55 (BCI)), p.  A-11. 
663 HRS Sections B -C questionnaire response,  (Exhib it KOR-56 (BCI)), Section B.  
664 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), Section C.  
665 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-28. 
666 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-29. 
667 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-30. 
668 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), pp.  B-29-B-30. 
669 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-29. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 82 - 
 
  as part of its response concerning "inland freight to the customer".670 Hyundai Steel also provided a 
sample calculation worksheet for the reported costs.671 Regarding warehousing services, 
Hyundai  Steel responded that "in some instances" it "used offsite warehouse facilities close to its 
factory to temporarily store finished subject products prior to shipment to the final customer".672 
Hyundai Steel noted that the calculation worksheet submitted for inland freight to warehouse also 
showed the warehousing expenses calculation, since the two services were grouped in the same 
contract with [[***]].673 Providing "a list of the off -site warehousing locations", Hyundai Steel 
explained:  
Hyundai Steel uses different warehousing services for PO products versus all other 
HR products. Hyundai Steel warehouses PO products at several warehous es, including 
a warehouse located in [[***]], which is managed by an unaffiliated provider, [[***]]. 
Hyundai Steel provides a copy of its contract with this unaffiliated provider in 
Exhibit  B-14 Hyundai Steel directly transacts with the unaffiliated servic e provider for 
these services. For all other HR products, Hyundai Steel uses warehousing locations are 
owned by unaffiliated parties, but the warehousing services at most of these facilities 
are provided by [[***]] and Hyundai Steel pays [[***]] for these warehousing services. 
[[***]] contracts with the unaffiliated warehouse providers and in turn pays them for 
warehousing. As described below, Hyundai Steel believes its transactions with this 
company reflect arm 's length prices.674 
Hyundai Steel referred aga in to its response allegedly demonstrating that the "inland freight to the 
customer" prices paid to [[***]] were at arm's  length , and submitted a copy of 
Hyundai  Steel's warehousing contracts with affiliated and unaffiliated providers for HR products 
(including PO  products).675 
Finally, for inland freight from plant/warehouse to customer, Hyundai Steel explained that it 
used its affiliate [[***]] to transport merchandise to the customer.676 Hyundai Steel provided "a 
sample calculation worksheet", and "a copy of its freight contract with [[***]] to support the per -unit 
expense amount associated with the shipment".677 As it did not use unaffiliated freight companies 
for similar services, Hyunda i Steel was "unable to provide comparable prices from unaffiliated 
vendors for comparison".678 Thus, in order to establish the arm's -length nature of the transactions 
between Hyundai Steel and its affiliate [[***]], Hyundai Steel provided "an excerpt from t he 
provider 's financial statements demonstrating that the company earned a profit during the POI".679 
"[B]ecause this company earned a profit during the POI", Hyundai Steel considered that "these 
transactions reflect arm 's length prices".680  
Under Section  C – for sales to the United  States  – the USDOC required Hyundai Steel to 
report the expenses incurred for inland freight for sales to the United  States681, international 
freight682, and marine insurance .683 For inland and international freight, the USDOC also asked 
Hyundai Steel to indicate and describe any affiliation.684 In response, Hyundai Steel stated that for 
domestic freight to port for sales to the United  States  during the POI it "transported merchandise by 
truck using an affiliated general logistics com pany, [[***]], which is the same company it used for 
domestic sales".685 Hyundai Steel submitted a sample calculation worksheet for these expenses and 
referred to its reporting under Section  B for inland freight expenses as establishing that [[***]] 
"provided such services at arm 's length".686 Additionally, Hyundai Steel also r eported international 
 
670 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-29. 
671 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-29. 
672 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-29. 
673 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-29. 
674 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-30. 
675 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-30 and exhibit  B-14. 
676 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-31. 
677 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-31. 
678 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-31. 
679 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-31. 
680 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  B-31. 
681 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  C-28. 
682 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  C-30. 
683 HRS Sections B -C quest ionnaire response,  (Exhibit  KOR-56 (BCI)), p.  C-30. 
684 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), pp.  C-28 and C -30. 
685 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  C-28. 
686 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  C-28. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 83 - 
 
  freight expenses "from the port of exit in Korea to the U.S. port of entry" and stated that "[d]uring 
the POI, [[***]] provided all shipping services for subject merchandise".687 Hyundai  Steel explained 
that freight fees were determine d through negotiation with the shipping provider, and provided a 
sample cost calculation worksheet along with certain invoices.688 Finally, regarding marine insurance, 
Hyundai Steel submitted a sample calculation worksheet for the related costs, along with certain 
invoices, without specifying whether it maintained other providers apart from [[***]].689 Unlike the 
other expenses, for marine insurance, the USDOC did not request an indication of any affiliation, 
and Hyundai Steel  did not address  the nature of it s affiliation.  
In sum, the USDOC 's initial Sections B -C questionnaire required Hyundai Steel to identify 
and describe its affiliations, but it did not seek any specific information concerning the arm's -length 
nature of the transactions. In response, Hyunda i Steel provided several pieces of information 
concerning its transactions with [[***]]. First, Hyundai Steel stated that it did not engage in 
transactions with unaffiliated suppliers for these services, and thus was unable to provide 
comparative informati on of prices paid to such providers. Instead, it submitted excerpts from [[***]] 
financial statements, demonstrating that the company earned a profit during the POI. According to 
Hyundai Steel, this indicated that its transactions with [[***]] were at arm' s length. Second, in 
addition to its contract with [[***]] that provided warehousing services for home market sales at 
most of its facilities, Hyundai Steel submitted a contract with an unaffiliated provider ([[***]]) that 
provided warehousing service at o ne warehousing location ( [[***]]).  
In its supplemental Sections A -C questionnaire, the USDOC observed that "[t]he net profit 
information provided for [[***]] does not show that [[***]] earned a profit from [these] services, 
or from non -operating income" and asked Hyundai Steel to demonstrate that its inland freight and 
its warehousing expenses were at arm 's length.690 For home market inland freight (to warehouse 
and to customer), warehou sing and inland freight for US sales, the USDOC requested "copies of all 
[] contracts with [[***]] and all unaffiliated freight providers that cover the full POI".691 For 
international freight, the USDOC stated that Hyundai Steel had not demonstrated that t he related 
expenses were at arm 's length, and thus requested "copies of : (1) the ocean freight contract 
between Hyundai Steel and [[***]], and (2 ) international freight contracts between [[***]] and the 
provider of the ocean freight services", and requeste d Hyundai Steel to "demonstrate that [[***]] 
direct costs, overhead, general, administrative and selling expenses and interest expenses are fully 
covered by the differential between the two contract values".692 With respect to marine insurance , 
the USDOC do es not appear to have questioned the arm 's-length nature of transactions at this 
stage.693 
Responding  to the USDOC 's supplemental queries, Hyundai  Steel explained that, for inland 
freight and warehousing for home market sales, [[***]] maintained almost 40 contracts with its 
(unaffiliated ) subcontractors, and provided – as a "representative sample" – [[***]] contracts with 
[[***]] covering all of these services.694 Hyundai Steel argued that a comparison between the 
[[***]]-[[***]] contract and the Hyundai  Steel-[[***]] contract submitted in its initial response695 
would demonstrate that [[***]] had charged Hyundai Steel higher fees than it paid to its unaffiliated 
subcontractor.696 According to Hyundai Steel, these materials demonstrated that [[***]] earned a 
profit from the services provided to Hyundai  Steel and thus these services were negotiated on an 
arm's -length basis.697 
With respect to inland freight for products destined to the United  States , Hyundai  Steel noted 
that [[***]] maintained over 30 subcontractors, and referred to the home market inland freight 
 
687 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  C-30. 
688 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  C-30 and exhibit  C-13. 
689 HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), p.  C-30 and exhibit  C-14. 
690 HRS supplemental Sections A -C questionnaire,  (Exhibit  USA-20 (BCI)), pp.  16-17 and 24.  
691 HRS supplemental Sections A -C questionnaire,  (Exhibit  USA-20 (BCI)), pp.  16-17 and 23.  
692 HRS supplemental Sections A -C questionnaire,  (Exhibit  USA-20 (BCI)), p.  25. 
693 HRS supplemental Sections A -C questionnaire response,  (Exhibit  KOR-59 (BCI)), p.  48. 
694 HRS supplemental Sections A -C questionnaire response,  (Exhibit  KOR-59 (BCI)), p.  31. 
695 HRS Se ctions B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), exhibit  B-16. 
696 HRS supplemental Sections A -C questionnaire response,  (Exhibit  KOR-59 (BCI)), pp.  31-32 and 
exhibit  S-38. 
697 HRS supplemental Sections A -C questionnaire response,  (Exhibit  KOR-59 (BC I)), pp.  32-33. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 84 - 
 
  contracts with [[***]] as a representative sample.698 Hyundai Steel asserted that these contracts, 
in conjunction with a "worksheet comparing the freight charged by [[***]] and the freight charged 
by [[***]] subcontractor, [[***]]", demonstrated that the delivery rates charged by [[***]] were 
arm's -length prices.699 According to Hyundai Steel, " [[***]] profit rate in relation to the 
transportation of the subject merchandise w as approximately [[***]] percent".700 Finally, regarding 
international freight expenses for US  sales, Hyundai Steel submitted its contract with [[***]] and a 
contract between [[***]] and its subcontractor [[***]], as well as invoices for the respective 
transactions, allegedly demonstrating that [[***]] made a profit on the services it provided to 
Hyundai Steel.701 
Based on the USDOC 's supplemental Sections A -C questionnaire and 
Hyundai  Steel's response thereto, we observe, first, that the USDOC addressed the deficiencies 
in the financial statements of [[***]] that Hyundai Steel supplied as part of its initial Section  B 
response for purposes of establishing the arm 's-length nature of the transactions with its affiliate.702 
Having identified these deficiencies, the USDOC sought several other pieces of information from 
Hyundai Steel for ascertaining its relationship with [[***]]. Second, for international freight, the 
USDOC expressly requested copies of contracts between Hyun dai Steel and [[***]], on the one 
hand, and between [[***]] and the "provider of the ocean freight services", 
i.e. [[***]]subcontractor703, on the other hand, and required Hyundai Steel to demonstrate that 
[[***]] various costs were "fully covered by the di fferential between the two contract values".704 In 
response, Hyundai Steel submitted its contract with [[***]] and a contract between [[***]] and its 
subcontractor [[***]].705 The express request for [[***]] contracts with its subcontractors suggests 
that th e USDOC considered such information to be germane to the issue of determining the 
arm's -length nature of the relationship between Hyundai Steel and [[***]]. Third, for inland freight, 
Hyundai  Steel provided a worksheet comparing the inland freight charged by [[***]] and the freight 
charged by [[***]] subcontractor, [[***]], that, together with the contracts, allegedly demonstrated 
that that the rates charged by [[***]] represented arm's -length prices.706  
The United  States  argues that the supplemental A -C questionnaire also marks the "first time" 
that the "USDOC … asked Hyundai Steel to submit copies of [[***]] contracts with unaffiliated 
customers … in … Question 83".707 The relevant part of that question, however, requested 
Hyundai  Steel to provide "copies of all freight contracts with [[***]] and all unaffiliated freight 
providers  that cover the full POI".708 Thus, the question was posed with respect to contracts between  
Hyundai Steel and "all" of its "unaffiliated freight providers".709 Contrary to the argument of the 
United  States , we find  nothing in the USDOC 's supplemental questionnaire suggest ing that it sought 
[[***]] contracts with its "unaffiliated customers " at th is stage.  
The USDOC did not pose any further queries with respect to Hyundai Steel 's responses until 
verification710, when the USDOC undertook a "completeness test" for the arm's -length nature of the 
transactions between Hyundai Steel and its affiliates. To  verify that the ocean and inland freight 
services were provided on arm's-length  basis by [[***]], the USDOC requested "that Hyundai  Steel 
 
698 HRS supplemental Sections A -C questionnaire response,  (Exhibit  KOR-59 (BCI)), p.  45 and 
exhibit  S-38. 
699 HRS supplemental Sections A -C questionnaire response,  (Exhibit  KOR-59 (BCI)), p.  46 and 
exhibit  S-56. 
700 HRS supplemental Sections A -C questionnaire response,  (Exhibit  KOR-59 (BCI)), p.  47 and 
exhibit  S-56. 
701 HRS supplemental Sections A -C questionnaire response,  (Exhibit  KOR-59 (BCI)), p.  48 and 
exhibits  S-59-S-60. 
702 HRS supplemental Sections A -C questionnaire,  (Exhibit  USA-20 (BCI)), pp.  16-17 and 24.  
703 HRS supplemental Sections A -C questionnaire,  (Exhibit  USA-20 (BCI)), p.  25. 
704 HRS supplemental Sections A -C questionnaire,  (Exhibit  USA-20 (BCI)), p.  25. 
705 HRS supplemental Sections A -C questionnaire response,  (Exhibit  KOR-59 (BCI)), p.  48 and 
exhibits  S-59-S-60. 
706 HRS supplemental Sections A -C questionnaire response,  (Exhibit  KOR-59 (BCI)), p.  46 and 
exhibit  S-56. 
707 United  States'  response to Panel question No.  17(b), para.  80. 
708 HRS supplemental Sections A -C questionnaire,  (Exhibit  USA-20 (BCI)), p.  16. (emphasis added)  
709 As noted above, Hyundai Steel had already clarified in its initial response that it did not maintain any 
freight contracts with unaffiliated providers during the POI.  
710 We recall that in the CRS AD investigat ion, the USDOC issued a second supplemental questionnaire 
in respect of these issues before its verification exercise, wherein it requested copies of [[ ***]] contracts with 
all unaffiliated parties for both international and inland freight.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 85 - 
 
  obtain comparative freight charge information between its affiliate, [[***]], and other unaffiliated 
parties".711 Officials of Hyundai Steel responded that "such information had been requested during 
the verification for the cold -rolled investigation, and that, as was the case then, Hyundai Steel could 
not obtain it" .712 Although  it acknowledg ed the information that Hyundai Steel had already submitted 
as part of its responses to the first supplemental questionnaire713, the USDOC did not identify any 
specific deficiencies in relation to that information , as it had done with the information submitte d 
with the initial questionnaire responses . The USDOC focused instead on Hyundai Steel 's failure to 
submit the specific information requested at verification :  
For inland freight, we observed that Hyundai Steel had previously provided, in 
Exhibit  S-38 of i ts January 19, 2016, supplemental response, the contract between 
[[***]] and its freight subcontractor [[***]], and further had provided in Exhibit S -56 
of the same submission a chart to show that [[***]] had earned a profit on the inland 
freight amount it  charged Hyundai Steel. For ocean freight, we similarly noted that 
Hyundai Steel had provided in Exhibit S -59 of its January  19, 2016, supplemental 
response, the contract between [[***]] and its ocean freight subcontractor [[***]], and 
further had provided  in Exhibit S -60 of the same submission sample invoices from 
[[***]] to [[***]], and from [[***]] to Hyundai Steel, to show that [[***]] had earned 
a profit. However, Hyundai Steel was not able to provide the requested comparative 
freight charge informatio n between [[***]] and unaffiliated parties.714 
Additionally , at verification, the USDOC requested Hyundai Steel to "obtain comparative 
marine insurance rate information between its affiliate, [[***]], and other unaffiliated parties".715 
Hyundai  Steel responded similarly that it was unable to compel [[***]] to provi de this 
information.716 Instead, Hyundai Steel submitted its invoice from an unaffiliated marine insurance 
supplier, [[***]].717 For Hyundai Steel, a comparison between the marine insurance expenses 
charged by [[***]] and the unaffiliated provider demonstrat ed that the transactions with [[***]] 
were at arm 's length.718 
Given our finding above that the USDOC did not seek copies of the contracts between [[***]] 
and unaffiliated customers as part of its initial questionnaire or its supplemental questionnaire, we 
find that verification marked the first instance whe n the USDOC specifically requested this 
information. In particular , for marine insurance, the United  States  acknowledges that the "first 
instance that [the] USDOC asked Hyundai Steel to submit copies of contracts that [[***]] had with 
all unaffiliated customers was during verification".719 
Much of the USDOC 's analysis of this issue in its final determination concerned why, in light 
of their affiliation and common control, Hyundai Steel should have been able to provide the contracts 
between its affiliates and their unaffiliated customers that were requested at verification.720 The 
USDOC also found that "Hyundai Steel failed the completeness portion at verification with regard to 
this issue, i.e., failed to demonstrate the arm's -length nature of these services provided by the 
affiliated companies".721 The USDOC thus considered that "necessary information" was "not on the 
record due to Hyundai Steel 's failure to provide it", and on this basis decided to rely on facts 
available, "with an adverse inference" due to Hyundai Steel 's failure to cooperate by not acting to 
the best of its ability.722 For its final determination, the USDOC selected for home market inland 
 
711 HRS verifica tion report,  (Exhibit  KOR-57 (BCI)), p.  14. 
712 HRS verification report,  (Exhibit  KOR-57 (BCI)), p.  14. 
713 The USDOC is referring to the responses to the first supplemental questionnaire. ( HRS supplemental 
Sections A -C questionnaire response,  (Exhibit  KOR-59 (BCI)), p.  46 and exhibits  S-38, S -56, and S -59-S-60). 
714 HRS verification report,  (Exhibit  KOR-57 (BCI)), pp.  14-15. (emphasis added)  
715 HRS verification report,  (Exhibit  KOR-57 (BCI)), p.  15. 
716 HRS verification report,  (Exhibit  KOR-57 (BCI)), p.  15. 
717 HRS verification report,  (Exhibit  KOR-57 (BCI)), pp.  14-15 and exhibit  HS-36. See also  HRS case 
brief, (Exhibit  KOR-65 (BCI)), pp.  9-10. 
718 HRS verification report,  (Exhibit  KOR-57 (BCI)), p.  15. 
719 United  States'  response to Panel question No.  17(c), para.  81.  
720 HRS issues and decision memorandum,  (Exhibit  KOR-67), p.  19. 
721 HRS issues and d ecision memorandum,  (Exhibit  KOR-67), p.  19. 
722 HRS issues and decision memorandum,  (Exhibit  KOR-67), p.  19. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  freight and warehousing the  lowest reported values, and for marine insurance, international freight, 
and inland freight for US sales , the highest reported values.723 
Although investigating authorities enjoy a certain discretion in identifying the information 
they consider "necessary"  for purposes of making their determinations, they must, at all times, act 
consistently with the provisions of Article  6.8 and Annex  II in their treatment of such information. 
In particular, paragraph  1 of Annex  II requires investigating authorities to "sp ecify in detail the 
information required from any interested party", "[a]s soon as possible after the initiation of the 
investigation". Investigating authorities must "also ensure that the party is aware that if information 
is not supplied within a reasona ble time, the authorities will be free to make determinations on the 
basis of the facts available". Paragraph 1 of Annex  II serves as an additional "precondition" for an 
investigating authority 's valid resort to "facts available".724 An investigating author ity that does not 
request information in accordance with paragraph  1 of Annex  II cannot fault an interested party for 
failing to provide "necessary" information for purposes of resorting to  facts available.  
Korea argues that "the USDOC suddenly  requested t he contract information as if that 
information was essential  to the question of the arm 's-length nature of the transactions when it had 
never been before", thus failing to specify in detail the information "it apparently considered 
necessary" as soon as po ssible after the initiation of the investigation, as required by paragraph  1 
of Annex  II.725 The United  States  argues that "following Hyundai  [Steel] 's initial response, [the] 
USDOC determined that it needed further information to evaluate nature of the transaction between 
Hyundai [Steel] and its affiliated service providers", and notes "[t]he number of times that 
Hyundai  [Steel] was asked to provide information related to the t ransactions between 
Hyundai  [Steel]  and its affiliates".726 
The "necessary" information that was found to be missing by the USDOC were copies of 
contracts between Hyundai Steel 's affiliates ([[***]]) and their unaffiliated customers. As we have 
found above,  although the USDOC sought several other pieces of information as part of its 
supplemental Sections A -C questionnaire, the information concerning the affiliates ' contracts with 
their unaffiliated customers was not specifically requested by the USDOC at any  point prior to its 
verification exercise.  
In these circumstances, we find that the USDOC acted inconsistently with paragraph  1 of 
Annex  II to the Anti -Dumping  Agreement  by not "specify[ing] in detail" the information concerning 
the affiliates ' contracts with unaffiliated customers  "[a]s soon as possible after the initiation". 
Given  that paragraph  1 of Annex  II serves as a precondition for an investigating authority 's proper 
resort to facts available under Article  6.8 of the Anti -Dumping  Agreement727, we find that the 
USDOC  also acted inconsistently with that provision in resorting to facts available  with respect to 
Hyundai  Steel's reporting of affiliated party transactions.  In light of our findings of 
WTO-inconsistency, we do not consider  it necessary to rule upon Korea 's claims under paragraphs  3, 
5, and 6 of Annex  II to the Anti -Dumping  Agreement  in order to provide a positive solution to the 
dispute before us.728  
7.3.3.4.2   The USDOC 's selection of the replacement facts  
We have already found that the USDOC erred in resorting to facts available with respect to 
information concerning Hyundai Steel 's reporting of affiliated party transactions. In these 
circumstances, we do not consider that making further findings on Korea 's claims concerning the 
USDO C's selection of the replacement facts on the basis of the record used for the 
USDOC 's WTO-inconsistent findings would assist in providing a positive solution to the dispute before 
us.729 
 
723 HRS issues and decision memorandum,  (Exhibit  KOR-67), pp.  19-20. 
724 Panel Report, China – GOES , para.  7.385.  
725 Korea's  first written submission, pa ras. 494-495. (emphasis added)  
726 United  States'  first written submission, paras.  154-155. 
727 Panel Reports, China – GOES , paras.  7.384 -7.385 and 7.393 -7.394; US – Steel Plate , 
paras.  7.55-7.56. See paras.  7.26.  -7.27 above.  
728 See, e.g. Panel Reports, EC – Salmon (Norway) , para.  7.387; and Morocco – Hot-Rolled St eel 
(Turkey) , paras.  7.105 -7.106.  
729 See, e.g. Panel Reports, Egypt – Steel Rebar , para.  7.310; and Mexico – Anti-Dumping Measures on 
Rice, para.  7.200. See also Panel Report, China – Broiler Products , para. 7.555.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 87 - 
 
  
Korea 's claims under Articles  1, 9.3, and 18.1 of the Anti -Dumping  Agreement  
Korea further claims that the USDOC 's use of facts available inconsistently with Article  6.8 
and Annex  II of the Anti -Dumping  Agreement  "led to an anti -dumping duty that was imposed and 
collected in excess of the margins of dumping in vio lation of Articles  1, 9.3, and 18.1 of the 
Anti-Dumping  Agreement ".730 According to Korea, because the margin of dumping was determined 
based on facts available in a manner inconsistent with Article  6.8 and Annex  II, "the imposition of 
duties at the level o f the margin of dumping automatically violated Article  9.3".731 Moreover, Korea 
asserts that the violation of Article  6.8 and Annex  II also "automatically leads" to a violation of 
Articles  1 and 18.1 of the Anti -Dumping  Agreement , as "this USDOC investigati on and the measure 
taken were not in accordance with the Anti -Dumping  Agreement ".732  
The United  States  responds that Korea 's claims under Articles  1, 9.3 , and 18.1 are "entirely 
consequential" and "Korea offers no argument or evidence to support any indepe ndent breach of 
those provisions".733 According to the United  States , were the Panel to uphold Korea 's claims under 
Article  6.8 and Annex  II, "there would be no basis to decide Korea 's consequential claims".734 First, 
the United  States  "does not concede that such breaches are 'automatic'".735 Second, the 
United  States  submits that deciding such claims would be serve "no useful purpose" and would 
provide no "additional guidance that would be useful regarding implementation of any 
recommendations adopted by the DSB".736 
Korea does not present any independent bases for the  alleged breaches of Articles  1, 9.3, 
and 18.1 of the Anti -Dumping  Agreement ; instead, its claims under these provisions  are dependent 
entirely upon a finding that the United  States  acted inconsistently with Article  6.8 and Annex  II of 
the Anti -Dumping  Agreement .737 In these circumstances – and having already found that the 
United  States  acted inconsistently with Article  6.8 and paragraph  1 of Annex  II – we do not consider 
it necessary to rule upon Korea 's claims under Articles  1, 9.3, and 18.1 in order to r esolve the dispute 
before us.738 
7.3.4   Countervailing duties on certain cold -rolled steel flat products from Korea 
(USDOC  investigation number C -580-882)  
Introduction  
Korea claims that the United  States  acted inconsistently with Article  12.7 of the 
SCM Agreement  in the countervailing duties investigation concerning certain CRS flat products from 
Korea (the "CRS CVD investigation").739 Specifically, Korea claims that the USDOC acted 
inconsistently with Article  12.7 of the SCM  Agreement  by using facts avai lable in respect of 
three  issues:  
a. POSCO 's alleged failure to report certain cross -owned affiliate input suppliers 
("cross -owned affiliate input suppliers")740; 
b. POSCO 's alleged failure to report a facility located in a Free Economic Zone (FEZ ) ("POSCO 
facility in an FEZ")741; and  
 
730 Korea's  first written submission, para.  521. 
731 Korea's  first written submission, paras.  518-519. 
732 Korea's  first written submission, para.  520. 
733 United  States'  first written submission, para.  356. 
734 United  States'  first written submission, para.  358. 
735 United  States'  first written submission, p ara. 358. 
736 United  States'  first written submission, paras.  358-359. 
737 Korea's  first written submission, paras.  519-520. 
738 See, e.g. Panel Reports, US – Differential Pricing Methodology , paras.  7.114 -7.115; Argentina – 
Poultry Anti -Dumping Duties , para.  7.369; US – Steel Plate , para.  7.103; and EU – Footwear (China) , 
para. 7.935.  
739 Korea's  first written submission, para.  335. 
740 Korea's  first written submission, paras.  343, 391 -401, and 426 -429. 
741 Korea's  first written submission, paras.  343, 402 -413, and 430.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 88 - 
 
  c. POSCO 's affiliated trading company, Daewoo International Corporation  (DWI) 's alleged 
failure to provide requested information about the use of Korean Resources Corporation 
(KORES ) loans ("DWI loan data").742 
Korea argues that POSCO app lied its best efforts to respond to the USDOC 's information 
requests, and did not significantly impede the investigation, or otherwise fail to provide necessary 
information pertaining to the three issues above.743 Korea contends that the USDOC failed to use  
any of the substantiated facts on the record and disregarded all of the verifiable information provided 
by POSCO.744 Korea also claims that the USDOC did not corroborate the accuracy and relevance of 
the "AFA rates" and failed to engage in the required com parative evaluation to determine whether 
the selected replacements constituted the "best information available".745 
We begin by setting out the relevant factual background of the underlying investigation, 
followed by the parties ' arguments. In section  7.3.4.4.1 , we address Korea 's claims of 
WTO-inconsistency regarding the USDOC 's resort to facts available for each of the three issues 
identified above. Finally, in section  7.3.4.4.2 , we address Korea 's claims of WTO -inconsistency 
regarding the USDOC 's selection of the replacement facts for each of the three issues.  
Factual background  
7.3.4.2.1   The USDOC 's resort to facts available  
7.3.4.2.1.1   Cross -owned affiliate input suppliers  
In its initial questionnaire, the USDOC requested certain information concerning  
POSCO 's cross-owned affiliate input suppliers.746 POSCO responded that it did "not believe it [had] 
any affiliates that [met] any of the four cross -ownership criteria as defined [] by the [USDOC]", or 
that "POSCO or any of its affiliates [were] cross -owned by a th ird party".747 In the same 
questionnaire, the USDOC sought  the identity of all affiliated companies and a detailed description 
of the  relationship between POSCO and these companies – requests with which POSCO  complied.748 
The USDOC issued a supplemental questionnaire ask ing POSCO to confirm that no cross -owned 
affiliates supplied inputs in the production of subject merchandise.749 POSCO r ecalled  that it had 
already provided an answer to this question.750 
Prior to verificatio n, the USDOC instructed POSCO to "[b]e prepared to demonstrate that 
none of POSCO 's other affiliated companies provided inputs for the production of cold -rolled steel or 
otherwise would fall under our attribution regulations".751 During verification, the US DOC asked 
 
742 Korea's  first written submission, paras.  343, 414 -423, and 431.  
743 Korea's  first written submission, para.  336. 
744 Korea's  first written submission, para.  337. 
745 Korea's  first written submission, paras.  338 and 433 -450. 
746 CVD CRS affiliated companies response, (Exhibit  KOR-73 (BCI)). Section III of the 
USDOC's  questionnaire reads, in relevant part:  
Cross -ownership exists between two companies where one company can  use or direct the 
individual assets of another company in essentially the same ways it can use its own assets. 
Normally, such a relationship exists between two companies where one company holds, directly or 
indirectly, a majority voting interest in the ot her. In addition, if two companies are both 
cross-owned by a third party, the two companies themselves would be considered cross -owned 
(for example, cross -ownership exists between two companies owned by the same parent).  
You must provide a complete questi onnaire response for those affiliates where "cross -ownership" 
exists, and one of the following situations exists:  
• the cross -owned company produces the subject merchandise; or  
• the cross -owned company is a holding company or a parent company (with its own 
operations)  of your company; or  
• the cross -owned company supplies an input product to you for production of the 
downstream product produced by the respondent;  or 
• the cross -owned company has received a subsidy and transferred it to your company.  
(CVD CRS affil iated companies response, (Exhibit  KOR-73 (BCI)), pp.  4-5) 
747 CVD CRS affiliated companies response, (Exhibit  KOR-73 (BCI)), p.  5. 
748 CVD CRS affiliated companies response, (Exhibit  KOR-73 (BCI)), pp.  3-4 and exhibit  1. 
749 CVD CRS second supplemental question naire response, (Exhibit  KOR-74 (BCI)), p.  1.  
750 CVD CRS second supplemental questionnaire response, (Exhibit  KOR-74 (BCI)), p.  1. 
751 CVD CRS verification report, (Exhibit  KOR-75 (BCI)), p.  5. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 89 - 
 
  POSCO to discuss and document  (a) the corporate history, ownership, structure, and affiliations; 
(b) the products produced and exported; and (c ) the location of all offices and facilities.752 
The USDOC found that four additional companies listed on POSCO 's affiliation chart provided raw 
material inputs that were used in the production of CRS.753  
In its final determination, the USDOC found that "POSCO failed to provide questionnaire 
responses f or certain input suppliers and its statement that no affiliated companies in Korea provided 
inputs to POSCO 's production of subject merchandise was verified to be incorrect".754 POSCO argued 
that it was not required to provide questionnaire responses for th e affiliated  companies, as the input 
products they supplied were not "primarily dedicated" to the production of CRS.755  
The USDOC stated that "[b]ecause POSCO failed to provide responses for cross -owned input 
suppliers … the [USDOC] was not provided the op portunity to carefully examine the full extent to 
which POSCO and all of its cross -owned entities, including the aforementioned companies, benefitted 
from subsidies that are attributed to POSCO".756 According to the USDOC, the information requested 
was only  provided near the conclusion of the final day of the verification,  and therefore it "was unable 
to verify this information, a document that listed inputs used in the production of cold -rolled and 
providers of the inputs, due to the untimely nature and lar ge amounts of data required to fully 
establish the credibility of the submission".757 The USDOC concluded that POSCO failed to act to the 
best of its ability because it did not put in "maximum effort" to provide the USDOC with full and 
complete answers to a ll inquiries relat ing to the inputs provided by cross -owned affiliated 
companies.758 The USDOC found that "inputs produced by POSCO Chemtech, POSCO P&S, POSCO 
MTech, and POS -HiMetal [were] primarily dedicated to the production of the downstream 
product".759  
7.3.4.2.1.2   POSCO facility in an FEZ  
Companies in a Korean FEZ can be approved to receive tax reduction and exemptions, 
exemptions and reduction of lease fees, and grants and financial support.760 The USDOC requested 
POSCO and DWI provide information concerning subsid ies provided to companies in an FEZ.761 Both 
companies responded that they had "no facilities located in [an FEZ ]" and thus were "not eligible 
for, and did not receive any tax reductions, exemptions, grants, or financial support under any of 
the three progr ams listed" in the USDOC 's question.762 In its preliminary determination, the USDOC 
found that POSCO and DWI "did not apply for or receive countervailable benefits during the POI" 
under programmes for subsidies to companies in an FEZ.763 
During verification , the USDOC found that the POSCO Global R&D Centre was listed on the 
official Incheon FEZ government website as being located in the Incheon FEZ.764 In the final 
determination, the USDOC explained as follows:  
 
752 CVD CRS verification report, (Exhibit  KOR-75 (BCI)), p.  5. 
753 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  65. The four companies at issue 
were POSCO Chemtech, POSCO P&S, POSCO M -Tech, and POS -HiMetal. (CVD CRS verification report, 
(Exhibit  KOR-75 (BCI)), pp.  10-14; CVD CRS issues and decision memorand um, (Exhibit  KOR-77), p.  65). 
754 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  64. 
755 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), pp.  58-59 and 64. US law provides 
that "[i]f there is cross -ownership between an input supplier and  a downstream producer, and production of 
the input product is primarily dedicated to production of the downstream product, the Secretary will attribute 
subsidies received by the input producer to the combined sales of the input and downstream products 
produced by both corporations (excluding the sales between the two corporations)". (19 CFR 351.525, 
(Exhibit  KOR-80), Section (b)(6)).  
756 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), pp.  64-65. 
757 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), pp.  66-67. (fn  omitted)  
758 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  69. 
759 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  69. 
760 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  34; GOK initial questionnaire, 
(Exhibit  KOR-84 (BCI)), p.  107. 
761 CVD CRS initial questionnaire response , (Exhibit  KOR-70 (BCI)), p.  52. POSCO responded to the 
USDOC's  questionnaires on behalf of itself and DWI. (CVD CRS negative preliminary determination, 
(Exhibit  KOR-87), p. 9). 
762 CVD CRS initial questionnaire response , (Exhibit  KOR-70 (BCI)), pp.  52-53. 
763 CVD CRS negative preliminary determination, (Exhibit  KOR-87), p.  41. 
764 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), pp.  72-73. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  We … asked POSCO officials for any i nformation regarding the purpose and location of 
the facility, to which they stated that they would attempt to provide further details as 
they were currently unaware of the facility. Approximately two hours later, POSCO 
officials presented a map printed fr om a Korean website that had a hand -drawn border 
surrounding what they claimed to be the FEZ. The POSCO officials stated that the facility 
was located outside of the hand -drawn FEZ. To compare, we examined the FEZ map on 
the official Korean government webs ite and found that the hand -drawn border did not 
conform to the map on the official government website. As such, we declined to accept 
the map presented by POSCO officials. We then offered repeatedly to visit the facility 
as depicted on the Korean governme nt website in order to clarify its location and confirm 
non-use of the FEZ program, but POSCO officials declined.765 
The USDOC found that it was unable to confirm POSCO 's statement that it had no facilities located 
in an FEZ , and therefore did not receive a ny FEZ related benefits , because POSCO provided no 
information in its questionnaire responses with respect to this facility.766  
The USDOC rejected POSCO 's argument that the questions regarding the FEZ programme 
were untimely because they were posed during the DWI verification.767 The USDOC explained that 
it had indicated in the verification outline that it was going to verify the "non -use" of the 
programme.768 The USDOC also rejected POSCO 's claim – based on a statement  by the Government 
of Korea (GOK)  that "during the investigation period, none of the respondents received tax 
reductions or exemptions, lease -fee reductions or exemptions, or grants or financial support due to 
their location in an FEZ" – that it did not receive any benefits due to its loc ation in an FEZ.769 The 
USDOC stated that it was not clear from the GOK statement whether "investigation period" referred 
to the period of investigation ( POI) or the entire 15 -year average useful life (AUL ) of the "renewable 
physical asset"770 and the USDOC , therefore,  could not fill the gap in the record.771 Furthermore, the 
USDOC disagreed with POSCO that it could not have benefitted from this programme on the basis 
that it was designated to attract foreign investment. According to the USDOC, certain shareholders 
of POSCO appeared to be foreign and thus POSCO could have been eligible to receive funding.772 
The USDOC also rejected POSCO 's argument that none of the benefits received were related to the 
sale or production of the subject merchandise  and were therefore not attributable to POSCO, because 
the USDOC was not able to verify the operations of the activities of the POSCO Global R&D Centr e.773 
The USDOC concluded  as follows : 
Because we are unable to confirm POSCO 's statement that it has no fac ilities located in 
an FEZ, and, therefore, did not receive benefits under this program, we are relying on 
adverse facts available to find that this program was used by POSCO.774  
7.3.4.2.1.3   DWI loan data  
The USDOC requested POSCO and DWI to provide details regarding a ll assistance received 
during the POI in the form of "long -term loans" under the KORES  and Korea National Oil Corporation 
(KNOC ) programmes .775 "Long -terms loans" from KORES and KNOC were introduced with the 
purpose of "enhancing and stabilizing the supply of energy resources in Korea" .776 KNOC is 
responsible for the development of oil, whereas KORES is responsible for the development of other 
natural resources.777 DWI submitted that it had outstanding long -term borrowings from KORES and 
KNOC during the POI.778 However, according to DWI, these loans were tied to non -subject 
 
765 CVD CRS issues and decisio n memorandum,  (Exhibit  KOR-77), p.  73. 
766 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  73. 
767 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  73. 
768 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  73. 
769 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), pp.  73-74. 
770 See for example, CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  31. 
771 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  74. 
772 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  74. 
773 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  74. 
774 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  73. 
775 CVD CRS initial questionnaire response,  (Exhibit  KOR-70 (BCI)), p.  33. 
776 CVD CRS negative prelimi nary determination, (Exhibit  KOR-87), p.  23 (referring to GOK initial 
questionnaire, (Exhibit  KOR-84 (BCI)), p.  91). 
777 CVD CRS negative preliminary determination, (Exhibit  KOR-87), p.  24. 
778 CVD CRS initial questionnaire response,  (Exhibit  KOR-70 (BCI)), p.  34. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  merchandise and were unrelated to DWI 's exports to the United  States  of subject merchandise 
produced by POSCO.779 The USDOC issued a supplemental questionnaire  requesting DWI to provide 
a comp lete response regarding investments using KORES and KNOC loans.780 In response, 
DWI explained that there were two types of loans in the programme,  [[***]] and [[***]].781 
DWI reported that it had received KNOC and KORES loans that were [[***]].782 
In its preliminary determination , the USDOC found that POSCO maintained loans from KNOC 
and KORES, while DWI maintained long -term loans from KORES.783 However, the USDOC explained 
that its analysis related solely to loans from KORES as information on the record demonstrated that 
KNOC loans to POSCO were tied to non-subject merchandise.784 With respect to the KORES loans, 
the USDOC preliminarily determined that POSCO and DWI received a ben efit equal to "the difference 
between the amount of interest POSCO and DWI paid on the KORES loans and the amount the 
recipient would pay on a comparable commercial loan" (a calculated subsidy rate of 0.01%).785 
During verification , DWI submitted [[***]] under the KORES programme in the form of 
"[m]inor [c]orrections", that had initially been omitted due to an alleged "clerical mistake".786 The 
USDOC found that the [[***]] loans instead constituted an additional [[***]] loans that DWI had 
initially failed to report.787 The USDOC rejected the submission of the new loans at verification and 
explained in its final determination that this was because these loans amounted to "significant 
additions" and were not "minor corrections":  
As stated in the verification outline, we o nly accept information at verification as minor 
corrections that "corroborates, supports, and clarifies" factual information already on 
the record. Due to the magnitude of change in the reported lending under the specified 
program, we determined that the s ubmission did not constitute a minor correction, and 
instead, consisted of new factual information. As such, we rejected the submission from 
the record. Therefore, because the extensive nature of the corrections presented at 
verification by DWI to its loan s received under this program, we were not able to fully 
verify the use of this program.788 
The USDOC thus concluded that "DWI withheld necessary information requested" by the 
USDOC regarding the use of this programme and that , as a result, "necessary " information was 
"missing on the record" .789 
7.3.4.2.2   The USDOC 's selection of the replacement facts  
The USDOC found that:  
[T]he application of AFA is warranted with respect to POSCO 's responses for its failure 
to provide information for certain cross -owned affiliated companies, failure to report 
certain loans, and with respect to … POSCO 's … failure to report [its] respective 
location[] in an FEZ.790 
 
779 CVD CRS initial questionnaire response,  (Exhibit  KOR-70 (BCI)), p.  34. In detail, DWI reported that 
the KNOC loans were related to investments in the exploration and production of natural gas in [[ ***]], while 
the KORES loans were related to investm ents in [[ ***]]. 
780 CVD CRS supplemental questionnaire, (Exhibit  KOR-85), p.  4. 
781 CVD CRS second supplemental questionnaire response, (Exhibit  KOR-74 (BCI)), exhibit  F-11, p.  1. 
DWI explained that with [[ ***]], the repayment obligation is subject to the res ults of the development project. 
If the project fails, the company will be exempted from all or a portion of the repayment obligation. If the 
project succeeds, however, a portion of the project income is payable to KORES/KNOC. (Ibid.).  
782 CVD CRS second sup plemental questionnaire response, (Exhibit  KOR-74 (BCI)), p.  4 and 
exhibit  F-11, pp.  1-2 and exhibit  F-12. 
783 CVD CRS negative preliminary determination, (Exhibit  KOR-87), p.  24. 
784 CVD CRS negative preliminary determination, (Exhibit  KOR-87), p.  24. 
785 CVD C RS negative preliminary determination, (Exhibit  KOR-87), p.  24. 
786 CVD CRS DWI verification minor correction, (Exhibit  KOR-86 (BCI)).  
787 CVD CRS verification report, (Exhibit  KOR-75 (BCI)), pp.  2-3. 
788 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  76. (fns omitted)  
788 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  76. See also CVD CRS verification 
report, (Exhibit  KOR-75 (BCI)), pp.  2-3. 
789 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  76. 
790 CVD CRS i ssues and decision memorandum,  (Exhibit  KOR-77), p.  9. (emphasis added)  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  In drawing an adverse inference, the USDOC determined that POSCO benefitted from all 
programmes under investig ation, excluding programmes that were determined not to be 
countervailable.791 The USDOC explained that in selecting an "AFA rate" it was "guided by the … 
methodology" whereby it uses "the highest calculated program -specific rates determined for a 
cooperati ng respondent in the same investigation, or, if not available, rates calculated in prior CVD 
cases involving the same country" .792 
When relying on "secondary information", the USDOC explained that "it shall, to the extent 
practicable, corroborate that infor mation from independent sources that are reasonably at its 
disposal" .793 However, this obligation does not apply when the information relied on for "adverse 
inferences" is from "the petition, a final determination in the investigation, any previous review …  or 
determination … or any other information placed on the record" .794 Because the USDOC applied 
subsidy rates calculated in the underlying investigation, or previous investigations involving Korea, 
the USDOC found that the "corroboration exercise" was "ina pplicable".795 The USDOC calculated a 
CVD rate of 58.36% for POSCO.796 
Main a rguments of the parties  
7.3.4.3.1   The USDOC 's resort to facts available  
For each of the three issues , Korea claims that the USDOC acted inconsistently with 
Article  12.7 of the SCM  Agreement  as the conditions for resort to the use of facts available were not 
met.797 
7.3.4.3.1.1   Cross -owned affiliate input suppliers  
Korea argues that POSCO did not refuse access to any information regarding its affiliates as 
all the information was made available on short not ice and could have been verified if necessary.798 
According to Korea , POSCO did not simply make a "belated assertion" , as claimed by the USDOC, 
but it actually provided all the relevant supporting information.799 Korea argues that POSCO had not 
previously submitted information on the inputs purchased from its cross -owned affiliates because it 
had only sourced "minimal trace amounts ".800 Korea argues that this is confirmed by the 
USDOC 's practice, and relevant US la w, because "where the input is not primarily dedicated to the 
production of the downstream product, 'it is not reasonable to assume ' that the subsidy to the input 
supplier was meant to benefit the downstream producer".801 Noting that the concept of "primari ly 
dedicated" is not defined in US law, Korea refers to prior instances where the USDOC evaluated this 
standard on the basis, inter alia , of "the proportion of the cross -owned affiliates ' sales of inputs to 
the mandatory respondent as a percentage of the  cross-owned  affiliate 's total sales ".802 Korea 
further asserts that the USDOC 's questionnaire asked whether an affiliate supplies inputs for the 
production  of cold -rolled products during the POI, and not whether there was any input that could 
be used  in the production of the product, which was the USDOC 's ultimate reason for resorting to 
facts available.803 According to Korea, the USDOC did not point to evidence that the inputs at issue 
were actually used by POSCO in the production of subject merchandise that was exported to the 
United  States, let alone that they were primarily dedicated to the production of the subject 
merchandise or any intermediate "downstream product".804  
 
791 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), pp.  12-13. 
792 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  12. 
793 CVD CRS issues and decision memorandum,  (Exhibit KOR-77), p.  15. 
794 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  15. 
795 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  15. 
796 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  17. 
797 Korea's  first written submission , paras.  390, 391, 402, 414, and 424.  
798 Korea's  first written submission, para.  392. 
799 Korea's  first written submission, para.  392. 
800 Korea's  first written submission, para.  351. 
801 Korea's  first written submission, para.  351. 
802 Korea's  first written submis sion, para.  352. 
803 Korea's  response to Panel question No.  21. See also Korea's  second written submission, para.  149. 
804 Korea's  comments on United  States'  response to Panel question No.  73, p.  67. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 93 - 
 
  
Korea argues that nothing in the record demonstrates that the USDOC considered such 
information to be "necessary".805 In any event, Korea argues that the value of POSCO 's transactions 
with these cross -owned affiliates was on the record from POSCO 's initial responses, as part of 
POSCO 's consolidated financial statements, and that the requested information was therefore 
provided "within a reasonable period".806 Korea contends that, based on the consolidated financial 
statements, together with the data submitted by POSCO at verification conc erning the total value of 
inputs sources from each affiliate, the USDOC could derive the percentage of the inputs provided to 
POSCO as a percentage of the affiliates ' total sales.807 According to Korea, the document provided 
by POSCO during verification for med part of the administrative record, and the USDOC was not 
permitted to ignore it on the basis that it constituted  "new information".808 Based on the above, 
Korea argues that the USDOC failed to use timely, appropriately submitted, and verifiable 
informat ion from POSCO regarding its transactions with the cross -owned affiliates.809 According to 
Korea, the USDOC had no factual basis for its determination that the recipient of these inputs, 
POSCO, benefitted from the subsidies received by its affiliated input suppliers.810 
Korea submits  that POSCO did not significantly impede the investigation since the inputs 
provided were negligible, and that there was sufficient information on the record (from the 
questionnaire responses and from the verification stage ) to demonstrate this.811 According to Korea, 
POSCO did not fail to act to the best of its ability, and, in fact, it went to extraordinary lengths to 
obtain the cooperation of its affiliates to engage with the USDOC and obtain information that was 
requested in the  final stages of the investigation, despite being under the reasonable belief that it 
did not have to report this information.812 
The United  States  responds that POSCO tried to substitute itself for the investigating 
authority in deciding that the affiliate d inputs were not primarily dedicated to downstream 
products.813 The USDOC 's request was for POSCO to identify the affiliated suppliers, and not to 
engage in a "primarily dedicated " analysis.814 The United  States  argues that POSCO could not itself 
decide whe ther the inputs were primarily dedicated, given that the USDOC has never established a 
"bright line threshold " for such a determination, and points out that  Korea  does not  identify an 
instance where the USDOC permitted a respondent to make such a determina tion.815 Finally, the 
United  States  contends that POSCO did not seek guidance to determine whether the information at 
stake was, in fact, relevant or not.816 
The United  States  disagrees with Korea  that all the information was on the record from the 
early stages of the investigation. Although  POSCO listed the four cross -owned affiliates in its 
affiliation chart, neither that chart nor other information that POSCO provided prior to verification 
revealed that these companies produced inputs that could be used in the production of CRS.817 
Moreover , the United  States  submits that  the USDOC did not initially focus on the issue of affiliated 
suppliers because POSCO falsely claimed that no such affiliated suppliers existed.818 According to 
the United  States , Korea 's argument that the USDOC could have co nfirmed from the information 
available on the record that only trace amounts were provided by these affiliates, is based on the 
premise that the USDOC should have known that POSCO 's response (that it received no inputs from 
affiliates ) was false.819 For the  United  States , these deductions from the available evidence were 
"neither simple , nor logical ", nor based on any requirement in the SCM  Agreement .820 The 
 
805 Korea's  first written submission, para.  396. 
806 Korea's  first written submission, para.  394 (referring to CVD CRS initial questionnaire response , 
(Exhibit  KOR-70 (BCI)), exhibit  20). See also Korea's  second written submission, para.  154. 
807 Korea's  responses to Panel question No.  72(a), paras.  76-77, No.  72(b), par as. 78-79, 
and No. 72(c), para.  80. 
808 Korea's  comments on United  States'  response to Panel question No.  74(b), p.  70. 
809 Korea's  first written submission, para. 429.  
810 Korea's  first written submission, para. 428.  
811 Korea's  first written submission, para.  397. 
812 Korea's  first written submission, para.  399. 
813 United  States'  second written submission, para.  107. 
814 United  States'  second written submission, para.  109. 
815 United  States'  second written submission, para.  110. 
816 United  States'  second written submission, para.  113. 
817 United  States'  first written submission, para.  394. 
818 United  States'  first written submission, para.  395. See also United  States'  second written submission, 
para. 111. 
819 United  States'  response to Panel question No.  22, para.  99. 
820 United  States'  response to Panel question No.  22, para.  100. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  United  States  argues that , in order to determine whether inputs were primarily dedicated to 
downstream  products, the USDOC required an accurate response from POSCO.821 If POSCO had 
responded in the affirmative, this would have allowed the USDOC to solicit responses from those 
affiliates and analyse whether the inputs were primarily dedicated to the producti on of the 
downstream product.822  
The United  States  explains that the USDOC does not determine whether an input is 
"primarily dedicated" to the production of downstream products based on the input 's relation to a 
percentage of an affiliates ' total sales or a respondents ' total cost of production. Rather, t he 
USDOC 's inquiry into whether an input is "primarily dedicated" to the production of downstream 
products involves a "fact intensive assessment" of the extent to which the input is dedicated to the 
production of intermediate inputs and subject merchandise  (collectively, the "downstream 
products").823 The United  States  argues that looking at the value of the transactions between POSCO 
and its affiliated inputs suppliers would not have provided the necessary information for the USDOC 
to determine whether the inputs were primarily dedicated to downstream products.824 This is 
because the analysis does not rely on numerical values.825 
According to the United  States , the document provided by POSCO at verification listing the 
inputs used in the production of CRS, as well as the suppliers and value of those inputs826, was 
relevant to verification of POSCO 's statement that "no affiliated companies located in Korea provided 
inputs used in the production of the subject merchandise".827 However, the quantity of inputs was 
not relevant to that inquiry.828 The United  States  explains that, as POSCO had not reported its 
purchases of inputs from affiliated input suppliers, there was no underlying information for the 
USDOC to verify along with the document provided by POSCO; as such, the data would be regarded 
as new information.829 The purpose of verification, as explained by the USDOC, "is to check the 
accuracy of factual information already submitted on the record; it is not an opportunity to provide 
new factual information, as the deadlines to submit factual information are explicitly set forth 
under  19 CFR 351.301" .830 The United  States  argues that, although the financial statements provide 
the total value of sales for each of POSCO 's affiliat es, they did not contain any information about 
whether each affiliate provided POSCO with inputs, which was provided only at verification.831 
7.3.4.3.1.2   POSCO facility in an FEZ  
Korea argues that POSCO did not refuse access to "necessary " information, and acted to the  
best of its ability, despite not being able to provide the exact information requested by the USDOC 
at the last moment.832 According to Korea, instead of allowing POSCO to respond to the new 
information request with more time and in writing, the USDOC aske d on one occasion to visit the 
facility immediately, but POSCO was unable to arrange  such a visit .833 Korea further argues that, 
even though the general verification outline refers to the FEZ programme in question, it specifically 
refers to documentary evid ence and not to visiting a POSCO facility.834 
In any event, Korea argues that the necessary information concerning any benefits related 
to the FEZ was already on the record, having been provided both by POSCO and the GOK.835 In this 
respect, Korea maintains that the USDOC acted inconsistently by failing to use all substantiated facts 
 
821 United  States'  response to Panel question No.  72, para.  97. 
822 United  States'  response to Panel question No.  72, para.  98. 
823 United  States'  responses to Panel question No.  72, paras.  102-105 and No.  73, para.  106. 
824 United  States'  response to Panel question No.  72, para.  105. 
825 United  States'  comments on Korea's  response to Panel question No.  72(b), para.  59.  
826 United  States'  response to Panel question No.  74(a), para.  107 (referring to CVD CRS verification 
report, (Exhibit  KOR-75 (BCI)), pp.  10-11). 
827 United  States'  response to Panel question No.  74(b), para.  108 (referring to CVD CRS issues and 
decision memorandum,  (Exhibit  KOR-77), p.  64). 
828 United  States'  response to Panel question No.  74(b), para.  109. 
829 United  States'  response to Panel question No.  74(b), para.  109. 
830 United  States'  response to Panel question No.  74(b), para.  109 (referring to CVD CRS issues and 
decision memorandum,  (Exhibit  KOR-77), p.  67). 
831 United  States'  comments on Korea's  response to Panel question No.  72(a), para.  56. 
832 Korea's  first written s ubmission, para.  403.  
833 Korea's  first written submission, para.  406. 
834 Korea's  second written submission, para.  160. 
835 Korea's  first written submission, para.  407.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  provided by POSCO that were on the record.836 Korea recalls that the GOK in its questionnaire 
response stated that, "during the investigation period, none of the respondents recei ved tax 
reductions or exemptions, lease -fee reductions or exemptions, or grants or financial support due to 
their location in an FEZ".837 Korea argues that there is nothing "ambiguous" about this response 
from the GOK.838 Had POSCO or Hyundai Steel received AUL benefits that were allocated forward, 
Korea contends that the allocated portion would have been "received" in the POI.839 Thus, Korea 
explains that "the GOK 's response that neither company received any FEZ benefits in the POI would 
capture any AUL benef its that may have been allocated forward to the POI ".840 According to Korea, 
although the USDOC determined that it was not able to verify this information, or to use the 
GOK's response to fill the gap in the record because the response did not clarify whether the 
"investigation period" referred to the POI  or the "entire 15 -year AUL", the USDOC never asked the 
GOK to explain this reference.841 Korea notes that the United  States  fails to explain why it ignored 
the evidence supplied by the GOK, and that the alleged ambiguity of the USDOC 's statement was 
not a proper  basis for disregarding the veracity of the information provided and assume the 
opposite.842  
Korea argues that the USDOC and the United  States  improperly shift ed the focus of the 
inquiry, as the USDOC had initially requested POSCO  to report if it had appli ed for, used, or 
benefitted from any FEZ assistance, and whether it had any  facilities located in an FEZ.843 Korea 
recalls that POSCO  responded consistently and accurately to this question in the negative, and 
argues that the GOK 's statement that POSCO did not receive any FEZ benefits should have sufficed 
to verify the non -use of the programme.844 Finally, Korea asserts that the USDOC could have asked 
for information or checked itself whether POSCO was registered under the relevant FEZ programme,  
given that only registered companies could benefit therefrom.845 When asked by the Panel to identify 
record evidence demonstrating that the operations of the POSCO facility in the FEZ were unrelated 
to the subject merchandise, Korea states that the USDOC did not engage with an analysis of the 
information regarding the FEZ facility.846 
The United  States  respon ds that, in its initial questionnaire, POSCO denied having any 
facilities in an FEZ; at verification, however, the USDOC discovered that the POSCO Global 
R&D Centr e was listed on the official Incheon FEZ government website as being located in an FEZ. 
Upon inquiry, POSCO officials submitted a "hand -drawn map" and stated that the facility was outside 
the FEZ. However, the USDOC found a discrepancy in the alignment of the borders on the 
hand-drawn map and the map on the official government website, and thus de clined to accept the 
hand-drawn map offered by POSCO.847 The United  States  submits that POSCO provided no 
information in its questionnaire about the FEZ facility and therefore the USDOC was unable to verify 
any information with respect to subsidy use by the FEZ facility. The United  States  contends that 
Korea cannot shift the blame to the wording of the USDOC 's question, as POSCO's response was not 
accurate. In response to the question of whether POSCO had received any FEZ benefits , POSCO 
responded "that it did not benefit from any FEZ programs because it has 'no facilities located in a 
free economic zone ('FEZ') and thus was not eligible '".848 The United States asserts that this  response 
was shown to be incorrect and den ied the USDOC the opportunity to examine whether 
POSCO  benefited from FEZ assistance .849 
 
836 Korea's  first written submission, para.  430. 
837 Korea's  first written submission, para.  370 (quoting GOK initial questionnaire, 
(Exhibit  KOR-84 (BCI)), p.  108).  
838 Korea's  comments on the United  States'  response to Panel question No.  75, p.  72. 
839 Korea's  comments on the United  States'  response to Panel question No.  75, p.  72. 
840 Korea's  comments  on the United  States'  response to Panel question No.  75, p.  72. 
841 Korea's  first written submission, para.  370 (quoting CVD CRS issues and decision memorandum,  
(Exhibit  KOR-77), p.  74). 
842 Korea's  second written submission, para.  161. 
843 Korea's  response to Panel question No.  25 (referring to CVD CRS initial questionnaire response , 
(Exhibit  KOR-70 (BCI)), p.  13). 
844 Korea's  response to Panel question No.  25. See also Korea's  second written submission, para.  159. 
845 Korea's  response to Panel  question No.  25. 
846 Korea's  response to Panel question No.  27. 
847 United  States'  first written submission, para.  382. 
848 United  States'  second written submission, para.  117. (quoting CVD CRS initial questionnaire 
response , (Exhibit  KOR-70 (BCI)), p. 52 (emph asis added by the United States)).  
849 United  States'  second written submission, para.  117. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 96 - 
 
  
The United  States  submits that the USDOC explained in its questionnaire that it "allocates 
the benefits received from certain types of subsidies over time" and, "in order to appropriately 
measure any a llocated subsidies", the USDOC relied on a 15 -year AUL.850 Although the POI was a 
discrete and recent period, the USDOC explained it was "investigating alleged subsidies received 
over a time period corresponding to the [AUL]" .851 Thus, the United  States  explains that a portion 
of a subsidy received several years before the POI would be allocated to the 12 -month POI for 
purposes of calculating a CVD rate.852 
The United  States  also argues that, contrary to Korea 's assertions, the purpose and 
operations of the FE Z facility were never verified, and Korea points to nothing on the record to 
support its claim.853 Finally, the United  States  submits that there is no support for Korea 's argument 
that, as a Korean company, POSCO could not benefit from FEZ subsidies because, as the USDOC 
noted, information on the record demonstrates that certain shareholders of POSCO appear to be 
foreign and could have been eligible under the programme.854 The United  States  also noted that , 
when offered an opportunity to provide an explanation at verification, POSCO could have presented 
materials to show that it did not benefit from the FEZ programme,  instead of submitting a 
hand-drawn map.855 
7.3.4.3.1.3   DWI loan data  
Korea argues that DWI did not refuse access to "necessary " information, but, instead, 
actively participated and voluntarily reported the additional loans as soon as it discovered its 
inadvertent failure to do so in its initial responses.856 Even assuming that  the minor corrections could 
be rejected, Korea submits that there was no basis for the USDOC to reject information about the 
use of the KORES programme that was on the record from the start of the investigation.857 Korea 
also submits that DWI provided the necessary information within a reasonable period of time by 
responding in a timely manner to the initial questionnaires and correcting record facts upon learning 
of errors. In so doing, DWI did not introduce new factual information about an unknown subsidy  
programme,  but merely completed already provided information.858 Korea maintains that the 
corrections were "minor ", as they concerned the extent of use of the KORES programme,  and were 
filed in time for the USDOC to verify the information. According to Kor ea, the nature and quantity of 
the information submitted was such that it did not impact the USDOC 's ability to verify the 
information concerning the use of the KORES programme because the use of the programme was 
known and the corrected information only c oncerned [[***]] additional loans.859 Korea also submits 
that DWI did not significantly impede the investigation and, in fact, acted in good faith by correcting 
the information as soon as it discovered the errors.860 Finally, Korea contends that the USDOC fa iled 
to use all verifiable substantiated facts provided by DWI about the use of the KORES programme,  
while it was under the obligation to take into account all verifiable information even if they were 
deemed incomplete.861 
Korea argues that irrespective of the counting of the additional loans as [[***]] loan 
programmes , or as [[***]] loan disbursements, what is of essence is that these programmes  were 
"entirely unrelated to the production of the subject merchandise in question".862 According to Korea, 
this is evident from the mere title of these programmes  [[***]]863, as well as by DWI 's responses 
 
850 United  States'  response to Panel question No.  75, para.  111 (referring to GOK initial questionnaire, 
(Exhibit  KOR-84 (BCI)), pp.  2-3). 
851 United  States'  response to Panel question No.  75, para.  111 (referring to GOK initial questionnaire, 
(Exhibit  KOR-84 (BCI)), p.  3). 
852 United  States'  response to Panel question No.  75, para.  111. 
853 United  States'  first written submission, para.  406.  
854 United  States'  first written su bmission, para.  406 (referring to CVD CRS issues and decision 
memorandum,  (Exhibit  KOR-77), p.  74).  
855 United  States'  second written submission, para.  120. 
856 Korea's  first written submission, para.  416.  
857 Korea's  first written submission, paras.  417 and 431.  
858 Korea's  first written submission, para.  418.  
859 Korea's  first written submission, para.  420. See also Korea's  second written submission, para.  172. 
860 Korea's  first written submission, para.  421.  
861 Korea's  first written submission, paras.  425 and 431.  
862 Korea's  response to Panel question No.  28(a). See also Korea's  second written submission, 
paras.  166 and  171. 
863 For Korea, the titles of the loans make it clear that they were programmes for "explorat ion", 
unrelated to CRS production. (Korea's  response to Panel question No.  77, paras.  85-86). WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  and the absence of any contrary information on the r ecord.864 Korea further argues that, from the 
outset of the investigation, there was information on the record indicating that the KORES loans as 
a whole were unrelated to the production of the subject merchandise.865 Korea asserts that the 
USDOC assumed the  KORES loans were tied to subject merchandise, and did not make an affirmative 
finding based on evidence .866  
The United  States  responds that the additional loans unreported by DWI indicate that it was 
not acting in good faith.867 Additionally, the United  States  highlights the USDOC 's observation that 
the [[***]] additional loans represented a "significant change" in the magnitude of the funding 
provided under the programme.868 The United  States  contends that the change was significant 
irrespective of the metric used to calculate the number of loans because, in relative terms, the total 
number of loans increased by [[***]]% and the t otal value of the loans also increased materially.869 
The United  States  also points out that the information ultimately provided was untimely and 
unsolicited.870 The United  States  asserts that, given the extensive nature of the corrections, which 
could not b e verified for lack of time, the USDOC properly resorted to the use of facts available.871 
7.3.4.3.2   The USDOC 's selection of the replacement facts  
Following the USDOC 's application of AFA, Korea argues that POSCO 's margin increased 
from 0.18% in the preliminary determination to 59.72% in the final determination.872 Korea asserts 
that the USDOC did not engage in a process of reasoning or evaluation and its selection of 
replacement facts  was "not objective or fair ", but, instead, was "punitive " in nature .873 Korea argues 
that the USDOC failed to exercise special circumspection or check the information, as required by 
Article  12.7 of the SCM  Agreement .874 Korea contends that Article  12.7 of the SCM  Agreement  
imposes the same substantive obligations as paragr aph 7 of Annex  II to the 
Anti-Dumping  Agreement .875 
Korea argues that a comparative evaluation of the facts on the record would have confirmed 
that it was not reasonable to conclude that POSCO benefitted from all subsidy programmes  in the 
investigation.876 According to Korea, speculating and assuming that the cross -owned affiliates 
benefitted from all subsidy programmes  was not the "best information available".877 In relation to 
POSCO 's facility in an FEZ, Korea argues that the USDOC 's assumption that POSCO us ed the 
programmes  at issue had no factual basis in the record, and the USDOC did not explain  how and 
why the inference drawn was the "best information available" to replace the alleged ly missing 
information.878 In relation to DWI 's loan data, Korea argues that the USDOC did not examine whether 
the single loan programme rate was the best information, or appropriate and relevant for DWI 
or POSCO.879 
The United  States  responds that Korea fails to establish that the USDOC selected informa tion 
inconsistently with Article  12.7.880 The United  States  contends that Korea points to no evidence on 
the record demonstrating that it was unreasonable for the USDOC to conclude that POSCO 's affiliated 
 
864 Korea's  response to Panel question No.  28(a) (referring to CVD HRS supplemental new subsidy 
allegation questionnaire response, (Exhibit  KOR-94 (BCI)), exhibit  21). 
865 Korea's  response to Panel question No.  28(c). See also Korea's  second written submission, 
para. 168. 
866 Korea's  comments on the United  States'  response to Panel question No. 76, p.  73. 
867 United  States'  first written submission, para.  410.  
868 United  States' first written submission, para.  411. 
869 United  States'  second written submission, para.  126. 
870 United  States'  first written submission, para.  412. 
871 United  States'  first written submission, para.  411.  
872 Korea's  first written submission, para.  446. 
873 Korea's  first written submission, para.  436. 
874 Korea's  first written submission, para.  445. 
875 Korea's  response to Panel question No.  80, para.  94. 
876 Korea's first written submission, para.  440. 
877 Korea's  first written submission, para.  440. 
878 Korea's  first written submission, paras.  441 and 443.  
879 Korea's  first written submission, para.  444. 
880 United  States'  first written submission, para.  415. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  companies benefitted from the subsidy programmes  and that the FEZ programmes  were used 
by POSCO.881 
The United  States  asserts that the USDOC did not have an opportunity to carefully examine 
the use and the extent of the benefit received from the subsidy programmes  at issue due to 
POSCO 's failure to accuratel y report certain necessary information.882 According to the 
United  States , Article  12.7 of the SCM  Agreement  acknowledges that non -cooperation may lead to 
an outcome that is less favourable for the non -cooperating party, and Korea d oes not point to 
anything  on the record demonstrat ing that the USDOC 's determination was not accurate.883 As to 
the appropriateness and relevance of the selected rates for POSCO and DWI , the United  States  
observes that these rates reflected the actual experiences of companies in Ko rea and the real subsidy 
practices of the GOK.884 According to the United  States , it is a "logical inference" that the 
non-cooperating company has benefitted from the subsidy programmes  at issue, at least as much 
as the cooperating company in the same industry who received the higher benefit amount.885 The 
United  States  contends that nothing in Article  12.7 precludes an investigating authority to select 
replacement rates originally  determ ined in other investigations, especially when there are no subsidy 
rates available from identical or similar programmes .886  
Evaluation by the Panel  
7.3.4.4.1   The USDOC 's resort to facts available  
Article  12.7 of the SCM  Agreement  provides that:  
In cases in which any interested Member or interested party refuses access to, or 
otherwise does not provide, necessary information within a reasonable period or 
significantly impedes the investigation, preliminary and final determinations, affirmative 
or negative, ma y be made on the basis of the facts available.  
Under Article  12.7, an investigating authority may resort to facts available, inter alia , when  
"any interested Member or  interested party " refuses access to, or otherwise does not provide, the 
"necessary" info rmation. Article  12.7 of the SCM  Agreement  refers to "necessary" information and 
not to "required" or "requested" information.887 As discussed above, "'necessary information ' refers 
to the specific information held by an interested Member or an interested party that is requested by 
an investigating authority for the purpose of making determinations ".888 Ultimately, the question of 
whether certain information is "necessary" is to be assessed in light of the specific facts  and 
circumstances of a given case, including the specific determination that is sought to be made and 
for which information is sought .  
The use of the terms " refuses  access to, or otherwise does not provide " in Article  12.7 implies 
a certain response  – or a lack thereof  – by an "interested Member or interested party"  to a request 
for information by an investigating authority. In determining whether an evidentiary gap sufficient  
to warrant recourse to the facts available exists, an investigating authority may thus limit itself to 
the information provided by an "interested Member or interested party" in direct response(s ) to the 
authority 's specific request.  There may be other inf ormation elsewhere on the record that would 
allow the filling of such a gap, but this does not require an investigating authority to examine 
exhaustively the entire record before  resorting to the use of facts available. Rather, an investigating 
authority m ust examine all information provided by an "interested Member or interested party" in 
direct response to its specific request before resorting to facts available, and, subsequently, it must  
 
881 United  States' first written submission, para.  415.  
882 United  States'  first written submission, paras.  416-417. 
883 United  States'  first written submission, para.  418. 
884 United  States'  first written submission, para.  420. 
885 United  States'  first written submission, pa ra. 420. 
886 United  States'  first written submission, para.  422. 
887 The panel in Egypt – Steel Rebar drew this distinction in the context of Article  6.8 of the 
Anti-Dumping  Agreement. (Panel Report, Egypt – Steel Rebar , para.  7.151. See also Panel Report, US – 
Supercalendered Paper , para.  7.174).  
888 Panel Report, EC – Salmon (Norway ), para.  7.343. (emphasis added)  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  fully take into account any other information on the record as par t of its selection of the reasonable 
replacement for the missing "necessary" information.889 
With these observations in mind , we address Korea 's claims with respect to the 
USDOC 's resort to facts available in relation to each of the three issues, namely, cr oss-owned affiliate 
input suppliers, POSCO 's facility in an FEZ, and DWI 's loan data.  
7.3.4.4.1.1   Cross -owned affiliate input suppliers  
Korea advances two main arguments in support of its claim that the USDOC acted 
inconsistently with Article  12.7 with respect to POSC O's reporting of certain inputs supplied by its 
cross-owned affiliates. First, Korea argues that, in its questionnaire responses, POSCO did not report 
certain inputs provided by its cross -owned affiliates as these were not "primarily dedicated " to the 
production of the subject -merchandise and therefore did not fall within the scope of its reporting 
obligation.890 Second, Korea argues that there was other information on the record that would have 
allowed the USDOC to determine that POSCO sourced o nly trace  amounts of inputs from its 
cross-owned affiliates.891 Korea thus asserts that the USDOC erred in resorting to facts available as 
no "necessary" information was missing from the record. The United  States  responds that although 
Korea attempts to "sh ift blame" onto the USDOC, POSCO did not actually provide the requested 
information within a reasonable period of time.892 According to the United  States , nothing on the 
record indicates that the amounts of the inputs were "negligible"893, and, in any event,  only the 
USDOC can determine whether the inputs were primarily dedicated to the production of the subject 
merchandise .894 
For Korea, POSCO 's response – that no affiliated companies provided inputs to the 
production of subject merchandise895 – was "accurate"  in light of the USDOC 's "practice" requiring 
the disclosure only of affiliates that provide materials that are primarily dedicated to the production 
of subject merchandise.896 We recall that , in its initial questionnaire, the USDOC requested POSCO 
to provi de "complete questionnaire" responses for those affiliates that were "cross-owned ", inter 
alia, in instances where the cross -owned company "supplies" an input to POSCO for "production of 
the downstream product produced by the respondent".897 We note that t he USDOC 's query does not 
limit the reporting of such instances based on volume, value, or any other criteria. Instead, the 
USDOC 's question is broadly worded and encompasses information concerning all instances where 
inputs are supplied by a cross -owned affiliate.  
Upon questioning by the Panel, Korea agreed with the United  States  that "it is the USDOC 
that determines whether an input is 'primarily dedicated ' to the production of the downstream 
product".898 The information requested by the USDOC was n ot limited to those inputs that are 
primarily dedicated, but concerned all instances where inputs are supplied by a cross -owned affiliate. 
Without such information, the USDOC could not have determined which inputs were "primarily 
dedicated " to the producti on of the downstream product. In this sense, the information requested 
by the USDOC was "necessary" for  the purpose of making its determination.  
 
889 See also para. 7.138  above.  
890 Korea's  first written submission, para.  351. 
891 Korea's first written submission, para. 394; responses to Panel question No. 72(a), paras. 76 -77, 
No. 72(b), paras. 78-79, and No. 72(c), para. 80.  
892 United  States'  first written submission, paras.  394-395. 
893 United  States'  first written submission, para.  399. 
894 United  States'  first written submission, para.  399. 
895 CVD CRS affiliated companies response, (Exhibit  KOR-73 (BCI)), p. 4.  
896 Korea's  second written submission, para.  149.  
897 CVD CRS affiliated companie s response, (Exhibit  KOR-73 (BCI)), pp.  4-5. 
898 Korea's  response to Panel question No.  21. The relevant provision of US law, namely 
19 CFR 351.525(b)(6), relates to the conduct of the Secretary of the USDOC, including in relation to the 
attribution of a sub sidy to a product in the case of cross -owned input suppliers. Subsection  (iv) of that 
provision states that " [i]f there is cross -ownership between an input supplier and a downstream producer, and 
production of the input product is primarily dedicated to pr oduction of the downstream product, the Secretary 
will attribute  subsidies received by the input producer to the combined sales of the input and downstream 
products produced by both corporations (excluding the sales between the two corporations)". 
(19 CFR 351.525, (Exhibit  KOR-80), Section (b)(6)  (emphasis added)). The provision does not concern an 
interested party's  reporting obligation; nor does it limit this obligation to only those inputs that an interested 
party considers are primarily dedicated to the  production of the downstream product.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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Korea adds that interested parties are nonetheless "entitled to rely on prior proceedings and 
expression of re levant USDOC practice when responding to such questions".899 In its response to 
the USDOC 's initial questionnaire above, POSCO stated that " [t]here were no cross -owned 
companies located in Korea that provided inputs to POSCO 's production of subject merchandise" .900 
POSCO went on to explain that:  
[I]t has affiliated companies located outside Korea that supplied a small volume of 
inputs  of [[***]] during the POI. These affiliated companies were : [[***]]. However, 
as non -Korean companies, they are not subject to this investigation, which involves 
only subsidies provided by the Government of Korea.901  
POSCO thus stated that it did "not believe it [had] any affiliates that [met] any of the 
four cross-ownership criteria as defined above by the [USDOC]", no r that "POSCO or any of its 
affiliates [were] cross -owned by a third party".902  
We note that, as part of  its response, POSCO explained the basis for why it did not report 
inputs supplied by its non -Korean cross -owned affiliates. However, POSCO did not offe r a similar 
explanation that it was not reporting certain inputs supplied by its Korean cross -owned affiliates 
because they were, in its view, not primarily dedicated to the production of the 
subject -merchandise.903 This reason was provided by POSCO only at  verification904, after the USDOC 
found that certain inputs supplied by POSCO 's cross-owned affiliates were used, or "could be " used, 
in the production of CRS. By not explaining the basis for not reporting certain inputs supplied by its 
Korean cross -owned affiliates as part of its initial questionnaire response, POSCO created a situation 
whereby the USDOC could not explore this issue until "the very last juncture o f the investigation" , 
as it was precluded from seeking any further clarifications and verifying the information that was 
belatedly provided.905 For these reasons, we disagree with Korea that the "record evidence 
substantiates POSCO 's belief that it did not need to report such inputs, even from its cross -owned 
affiliates, when the inputs were clearly not 'primarily dedicated ' to the production of CR[S] 
products" .906 Any such "belief" that POSCO may have had at the time of its response was expressed 
only with r espect to "affiliated companies located outside Korea", for whom POSCO provided an 
explanation.  
Korea also argues that, in any event, "necessary" information was not "missing" because 
"the value of the transactions with these cross -owned affiliates and the  value of the transactions in 
relation to the cross -owned affiliates ' total sales were part of POSCO 's consolidated financial 
statements", that were on "the record from POSCO 's earliest responses" .907 However, as the 
United  States  points out, POSCO 's consol idated financial statements do "not contain any information 
about whether each affiliate provided POSCO with inputs".908 Indeed, Korea acknowledges that any 
information concerning the "total value of inputs sourced from each affiliate" was submitted only at 
verification .909  
In any event, we do not consider this to be an issue relating to the USDOC 's resort to facts 
availabl e. Korea does not argue, and we do not find, that the "other information" that Korea refers 
to – namely,  POSCO 's consolidated financial statements – was provided in direct response to the 
USDOC 's query concerning POSCO 's cross-owned affiliate  input supplie rs. In these circumstances, it 
was reasonable for the USDOC to limit itself to the information provided by POSCO in direct response 
to the USDOC 's specific request in determining whether an evidentiary gap sufficient to warrant 
 
899 Korea's  response to Panel question No.  21. 
900 CVD CRS affiliated companies response, (Exhibit  KOR-73 (BCI)), p.  5. 
901 CVD CRS affiliated companies response, (Exhibit  KOR-73 (BCI)), p.  5. (emphasis added)  
902 CVD CRS affiliated companies response, (Exhibit  KOR-73 (BCI)), p.  5. 
903 United  States'  response to Panel question No.  72(d), para.  101. 
904 The USDOC issued a supplemental questionnaire on 5 November 2015, wherein it asked POSCO to 
confirm that they had prov ided responses for all cross -owned companies that fell within 19 CFR 351.525(b)(6). 
POSCO responded that it believed that it had provided responses for all cross -owned companies that fell within 
19 CFR 351.525(b). (CVD CRS second supplemental questionnaire  response, (Exhibit  KOR-74 (BCI)), p.  1). 
905 United  States'  first written submission, paras.  395-397; second written submission, para.  104. 
906 Korea's  first written submission, para.  352. 
907 See, e.g. Korea's  second written submission, para.  154. See also Kor ea's response to Panel 
question  No. 72. 
908 United  States'  comments on Korea's  response to Panel question No.  72(a).  
909 Korea's  response to Panel question No.  72. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  recourse to the facts availa ble existed.910 The extent to which there was other information on the 
record that would have allowed the USDOC to deduce that the inputs at issue were not primarily 
dedicated to the production of the downstream product relates properly to the USDOC 's selection of 
the replacement facts, which we review below.911  
Thus, based on the scope of the USDOC 's request, the nature of the determination to be 
made, as well as the text of POSCO 's response, we find that the USDOC did not err in finding that 
POSCO "refuse [d] access to ", or "otherwise d [id] not provide ", "necessary" information  within the 
meaning of Article  12.7 of the SCM  Agreement . We therefore  find that Korea has not established  
that the USDOC 's resort to facts available with respect to information concer ning cross -owned 
affiliate input -suppliers is inconsistent with Article  12.7 of the SCM  Agreement . 
7.3.4.4.1.2   POSCO facility in an FEZ  
Korea argues that , throughout the investigation , POSCO stated that it did not use or benefit 
from any FEZ programmes .912 Korea submits that this response remains accurate, and is 
independent of whether or not POSCO had a facility located in the FEZ. Korea contends that the 
non-receipt of any subsidies under the FEZ programme was confirmed by the GOK  in its 
questionnaire res ponse and that, as a result, there was no "necessary" information missing so as to 
justify the USDOC 's resort to  facts available.913 Korea argues that investigating authorities cannot 
impose unreasonable demands on foreign producers.914 According to Korea, t he 
USDOC's  information request from the USDOC was "unreasonable".915 
We note that the parties agree that POSCO actually did, in fact, have a facility located in the 
Incheon FEZ.916 The issue before us is whether an "interested Member or interested party refuse[d] 
access to, or otherwise d[id] not provide, necessary information" for purposes of Article  12.7 of the 
SCM Agreement . Our examination of this issue must be carried out in the specific facts and 
circumstanc es of this case. In its initial questionnaire, the USDOC posed several "program specific 
questions" to POSCO. For all these questions, the USDOC offered the following general instructions:  
For each program, if your company (including cross -owned affiliates  required to 
respond, as well as all trading companies ) did not apply for, use, or benefit from that 
program during the POI, you must clearly state so. Otherwise, please answer the 
questions listed. To determine the information which must be reported under  each 
program, please see the instructions for each program in this section  of the 
questionnaire and in the referenced appendices.917 
Following these general instructions, the USDOC posed several programme specific questions. With 
respect to "subsidies to c ompanies located in certain economic zones" the USDOC 's initial 
questionnaire identified certain programmes  and offered the following instructions:  
1. Tax Reductions and Exemptions in Free Economic Zones  
2. Exemptions and Reductions of Lease Fees in Free E conomic Zones  
3. Grants and Financial Support in Free Economic Zones  
4. Acquisition and Property Tax Benefits to Companies Located in Industrial Complexes  
Please respond to the Standard Questions Appendix for each program listed above .918 
 
910 See para.  7.270  above.  
911 See paras.  7.303 -7.313  below.  
912 Korea's  second written submission, para.  138. 
913 Korea's  second written submission, para.  138. 
914 Korea's  first written submission, para.  412 (referring to Appellate  Body Report, US – Hot-Rolled 
Steel, paras.  100-101).  
915 Korea's  first written submission, para.  413. 
916 Korea's  response to Panel question No.  25, pp.  25-26.  
917 CVD CRS initial questionnaire response , (Exhibit  KOR-70 (BCI)), p.  13. 
918 CVD CRS initial questionnaire response , (Exhibit KOR-70 (BCI)), p.  52. (emphasis original)  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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Similar to its que stionnaire to POSCO, in its questionnaire to GOK, the USDOC posed several 
"program -specific questions" and offered the following general instructions:  
For each program, if no companies under investigation or "cross -owned" companies as 
defined in Section II I applied for, used, or benefited from that program during the POI , 
the GOK must so state and provide a brief explanation of the program and a detailed 
description of the records kept on that program. Otherwise, please answer all of the 
questions listed, e xcept as directed below.919  
POSCO responded that it had "no facilities located in [an FEZ]  and thus was not eligible for 
and did not receive any tax reductions, exemptions, grants or financial support under any of the 
three programs listed in the [USDOC] 's question".920 The GOK responded that:  
During the investigation period, none of the respondents received tax reductions or 
exemptions, lease -fee reductions or exemptions, or grants or financial support due to 
their location in an FEZ.921 
During ver ification, the USDOC subsequently discovered that a POSCO facility, namely, the 
POSCO Global R&D Centr e, "was listed on the official Incheon FEZ government website as being 
located in the Incheon FEZ".922 The USDOC asked for further information relating to the purpose and 
location of this facility. POSCO officials presented a map printed from a Korean website that had a 
"hand-drawn border " surrounding what they claimed to be the FEZ.923 The USDOC, however, found 
that the hand -drawn border did not conform to t he map on the official government website, and 
therefore declined to accept the map presented by POSCO officials. The USDOC officials then offered 
to visit the site of the facility immediately in order to clarify its location and confirm POSCO 's non-use 
of the FEZ programme. According to the USDOC's verification report, "POSCO officials declined this 
suggestion".924 In its case brief, POSCO noted that this request to visit the FEZ facility was made a 
day after the conclusion of the POSCO verification and on the last day of the DWI verification, without 
any prior notice, and that "[t]he POSCO representative present did not think this would be feasible 
or accomplish any purpose".925 
We note that the USDOC 's questionnaire instructed POSCO to "clearly state" that it "did not 
apply for, use, or benefit from that program [i.e. the relevant FEZ programmes ] during the POI".926 
Similarly, the determination made by the USDOC was that Hyundai Steel and POSCO received this 
subsidy during the POI, and that [they] benefited f rom the subsidy".927 Thus, the determination 
made by the USDOC was not  focused on  whether POSCO had certain facilities located in an FEZ, but  
instead concerned the issue of  whether POSCO received subsidies  under the relevant FEZ 
programmes  identified by the USDOC.  
Information relating to the location of POSCO 's facilities in an FEZ, though not requested 
specifically by the USDOC, was provided  by POSCO in support of  its assertion that that it did not 
receive any subsidies under any of the t hree programmes  identified by the USDOC.928 The logic 
underlying  POSCO 's response to the USDOC 's query  and the USDOC 's subsequent discovery at 
verification of a POSCO facility in the FEZ  could have called into question the accuracy of 
POSCO 's reporting. However, we note that the GOK 's response to the same query by the USDOC did 
 
919 GOK initial questionnaire, (Exhibit KOR -84 (BCI)), p.  3. (emphasis added)  
920 CVD CRS initial questionnaire response , (Exhibit  KOR-70 (BCI)), p.  52. 
921 GOK initial questionnaire, (Exhibit KOR -84 (BCI)), p.  108.  
922 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), pp.  72-73. This information was 
discovered by the USDOC when it had already completed the verification at POSCO and was undertaking the 
verification exercise at DWI's  headquarters. The USDOC di scovered the information on the official website of 
the Incheon FEZ during verification of DWI's  response that it was not located in the Songdo International City 
Zone.  
923 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p. 73.  
924 CVD CRS verificati on report, (Exhibit KOR -75 (BCI)), pp. 38 -39. See also CVD CRS issues and 
decision memorandum, (Exhibit KOR -77), pp. 72 -73. 
925 CVD CRS POSCO and DWI case brief, (Exhibit KOR -83 (BCI)), p. 6.  
926 CVD CRS initial questionnaire response , (Exhibit  KOR-70 (BCI)), p.  13. 
927 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  35. 
928 In its initial questionnaire response, POSCO stated that it "has no facilities located in a free economic 
zone ('FEZ')  and thus was not eligible for and did not receive any tax reductions, exemptions, grants or 
financial support under any of the three pro grams listed in the [USDOC]'s  question". ( CVD CRS initial 
questionnaire response , (Exhibit KOR -70 (BCI)), pp.  52-53 (emphasis added)).  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  not concern whether POSCO maintained a facility in an FEZ, but instead clearly stated that "[d]uring 
the investigation period, none of the respondents received tax reduc tions or exemptions, lease -fee 
reductions or exemptions, or grants or financial support due to their location in an FEZ ".929 
The United States explains that the GOK 's response was not used by the USDOC because 
the "statement is ambiguous [as] it is not clea r what Korea means by the 'period of investigation'".930 
The USDOC found that it was "unable to use the GOK 's response to fill this 'gap'  in the record" 
because "the GOK 's response does not clarify if the 'investigation period'  it refers to is the POI or 
the entire 15 -year AUL" .931 In this regard, we note that the USDOC provided the following 
instructions in its questionnaire to the GOK:  
Respondents should be aware that the [USDOC] allocates the benefits received from 
certain types of subsidies over time (s ee 19 CFR 351.524). As noted above, the AUL for 
this investigation is 15 years. Thus, in order to appropriately measure any allocated 
subsidies, the [USDOC] will use a 15 -year AUL in this investigation. Although the POI is 
a recent period, we are investiga ting alleged subsidies received over a time period 
corresponding to the AUL.932 
In its questionnaires to both POSCO and the GOK, the USDOC sought to confirm the non -use 
of these program mes during the POI . In its questionnaire to POSCO, the USDOC requested P OSCO 
to "clearly state" that it "did not apply for, use, or benefit from that program during the POI ".933 
Similarly, in its questionnaire to the GOK, the USDOC required the GOK to state "[f]or each program, 
if no companies under investigation or 'cross -owne d' companies as defined in Section III applied for, 
used, or benefited from that program during the POI ".934 The GOK 's response was limited to the 
"investigation period" and was therefore consistent with the scope of the USDOC 's query.935 
In response to the USDOC 's question about the application of a 15 -year AUL period, the GOK 
separately responded that "[t]he GOK does not have any particular view on the 
[USDOC] 's application of the 15 -year AUL in this CVD investigation" .936 
Thus, the GOK responded to the USDO C's specific queries directed at the use of these 
program mes "during the POI ". The GOK also did not express "any particular view" on the 
USDOC 's application of the 15 -year AUL in this investigation. In these circumstances, we do not 
agree with the United  States that the "Government of Korea did not clarify whether the investigation 
period that it referred to is the year long [POI]  or the entire 15 -year average useful li fe".937 Given 
the GOK 's responses, to the extent that the USDOC continued to consider its response "ambiguous", 
it should have sought further clarifications from the GOK. An unbiased and objective investigating 
authority would not have remained passive in t he face of such an alleged ambiguity in the reporting 
basis.938 Based on the exchange between the USDOC and the GOK, the USDOC 's conclusion that the 
GOK's response was "ambiguous" is, in our view, not one that an unbiased and objective 
investigating authori ty would have reached.  
The United  States argues that the USDOC determined that the GOK 's response was 
"ambiguous regarding whether the respondents benefitted  during the [POI]  from subsidies received 
prior to the [POI] ". As discussed above, the USDOC 's ultimate determination was made with respect 
to the POI, and found that POSCO both " received this  subsidy  during the POI , and that it benefited  
from the subsidy".939 Thus, the USDOC 's ultimate determination was not limited to whether POSCO 
benefitted from subsi dies received prior to the POI; instead the USDOC clearly found that POSCO 
 
929 GOK initial questionnaire, (Exhibit KOR -84 (BCI)), p.  108.  
930 United  States'  responses to Panel question No. 26, para.  113; and No. 75, paras.  111-113. 
931 CVD CRS issues and decision memorandum,  (Exhibit KOR -77), p.  74. 
932 GOK initial questionnaire, (Exhibit KOR -84 (BCI)), p.  3. 
933 CVD CRS initial questionnaire response , (Exhibit KOR -70 (BCI)), p.  13. 
934 GOK initial questionna ire, (Exhibit KOR -84 (BCI)), p.  3.  
935 GOK initial questionnaire, (Exhibit KOR -84 (BCI)), p.  108. (emphasis added)  
936 GOK initial questionnaire, (Exhibit KOR -84 (BCI)), p.  2. 
937 United  States'  response to Panel question No. 75, para.  112. 
938 Past panels and th e Appellate Body have previously found, albeit in different a context, that 
"authorities charged with conducting an inquiry or a study – to use the treaty language, an 'investigation' – 
'must actively seek out pertinent information' and may not remain 'pas sive in the face of possible 
shortcomings  in the evidence submitted'". (Panel Report, China – Broiler Products , para.  7.261 (referring to 
Appellate Body Report, US – Wheat Gluten , paras.  53 and 55)). (fns omitted)  
939 CVD CRS issues and decision memorandum,  (Exhibit KOR -77), p.  35. (emphasis added)  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  "received this subsidy during the POI". The USDOC 's determination does not explain why the 
GOK's response was ambiguous as to the receipt of subsidies during the POI . Even if the USDOC 
had a reasonable basis to consider the GOK 's response  to be ambiguous, any such ambiguity  could 
only concern subsidies that were received in the past and whether they continued to benefit POSCO 
during the POI, and not whether any subsidies were received during the POI – as ultimately found 
by the USDOC. Thus, we find that the USDOC was not justified in disregarding the information 
provided by the GOK – an interested Member – on the basis of a purported ambiguity relating to the 
AUL when the response w as clear as to the non -receipt of subsidies during the POI, which was also 
the focus of the USDOC 's ultimate determination.  
Accordingly, in the circumstances of this case, we find that the USDOC acted inconsistently 
with Article  12.7 of the SCM  Agreement in resorting to facts available with respect to information 
concerning POSCO 's facility in an FEZ because it erroneously disregarded the GOK 's response on this 
issue.  
7.3.4.4.1.3   DWI loan data  
Korea asserts that the USDOC acted inconsistently with Article  12.7 of the  SCM Agreement  
by refusing to accept certain allegedly "minor corrections" relating to the use of the KORES 
programme that were submitted voluntarily by DWI at verification. In addition, Korea challenges the 
USDOC 's decision to not use information that was  already on the record, despite DWI 's active 
participation in the investigation.  
We recall that in response to the USDOC 's initial questionnaire section  concerning "energy 
and resource subsidies", DWI identified certain "outstanding long -term borrowings" from the KORES 
and the KNOC during the POI.940 DWI explained as follows:  
DWI's KNOC loans are related to investments in the exploration and production of 
natural gas in [[***]]. They are thus tied to non -subject merchandise and unrelated to 
DWI's exports to the United  States  of subject merchandise produced by POSCO. 
DWI's KORES loans  are related to investments in [[***]]. As with the KORES loans, 
these loans are tied to non -subject merchandise and are unrelated to DWI 's exports to 
the United Sates of subject merchandise produced by POSCO. Therefore, as it did in 
NOES from Korea, the [USDOC] should determine that KORES and KNOC loans that are 
not tied to subject merchandise are not countervailable.941 
Subsequently, at the start of the verification, DWI presented "'two new loans ' under the 
[KORES]  program, which were not previously report ed".942 In presenting its minor correction, DWI 
explained as follows:  
While preparing for the verification [DWI]  found a clerical mistake in reporting KORES 
loans by missing two loans as follows.  
a. Loan relating to [[***]] 
b. Loan relating to [[***]][.]943  
DWI also submitted a chart which listed [[***]] different "[l]oan [a]greement [s]" (by date).944 
[[***]] loan Agreement s were listed as having the "purpose" of [[***]], and [[***]] had their stated 
purpose as [[***]].945 
 
940 CVD CRS initial questionnaire response , (Exhibit  KOR-70 (BCI)), p.  34. 
941 CVD CRS initial questionnaire response , (Exhibit  KOR-70 (BCI)), p.  34. (emphasis original) 
The reference to KORES loans in the penultimate sentence appears to be a typographical error and should 
instead refer to KNOC loans.  
942 CVD CRS verification report, (Exhibit  KOR-75 (BCI)), p.  3.  
943 CVD CRS DWI verification minor correction, (Exhibit  KOR-86 (BCI)), attachment 1.  
944 CVD CRS veri fication report, (Exhibit  KOR-75 (BCI)), p.  3; CVD CRS DWI verification minor 
correction, (Exhibit  KOR-86 (BCI)), attachment A.  
945 CVD CRS DWI verification minor correction, (Exhibit  KOR-86 (BCI)), attachment A.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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In its verification report, the USDOC explained that :  
In the loan chart presented to [USDOC] officials, two loans were circled, indicating the 
circled loans were being submitted as minor corrections. Company officia ls explained 
that when DWI reported the KORES loans in its initial questionnaire response, 
two [[***]] were omitted due to a misunderstanding that only [[***]] loans were 
required to be reported. Upon reviewing the loan chart, we noted that there were 
[[***]] loans submitted as minor corrections. We did not explicitly state that we would 
accept the submission as a minor correction at the time of verification. As noted above 
and in "Rejection of DWI Minor Corrections," we rejected this minor correction 
submi ssion.946 
In its final determination, the USDOC resorted to the use of facts available on the basis that  
"DWI withheld necessary information requested by the [USDOC] regarding it use of [the KORES] 
program and that as a result, necessary information is miss ing on the record" .947 The USDOC 
explained that:  
At verification, DWI presented a list of loans that it characterized as a minor 
correction,  claiming that it received "two loans," under the KORES and KNOC lending 
programs . … Due to the magnitude of change i n the reported lending under the specified 
program, we determined that the submission did not constitute a minor correction, and 
instead, consisted of new factual information. As such, we rejected the submission from 
the record. Therefore, because the exte nsive nature of the corrections presented at 
verification by DWI to its loans received under this program, we were not able to fully 
verify the use of this program.948  
The United  States  argues that, with the additional loans, the total value of DWI 's loans 
increased from [[***]] loans and [[***]] loans – an increase of more than [[***]]% and [[***]]%, 
respectively.949  
The determination made by the USDOC was whether POSCO received a benef it under the 
programmes950, and information  was requested from POSCO and DWI for purposes of making this 
determination. In its initial questionnaire response, POSCO and DWI explained that, "[f]or projects 
related to the development of strategic mineral reso urces, KORES lends the funds to the company 
for foreign resources development. For projects related to petroleum and natural gas, KNOC lends 
the funds to the company for foreign resources development" .951 In relation to the loans that were 
reported before v erification, POSCO and DWI both submitted that the loans were tied to non -subject 
merchandise and unrelated to the exports of CRS to the United  States .952 Thus,  evidence  existed on 
the record  suggest ing that the purpose for which the subsidies were given wa s not related to the 
production or export of the subject merchandise.953 This evidence was provided in direct response 
to the USDOC 's query, which in turn was made in light of the determination it sought to make, 
i.e. whether a benefit was received.  
Korea considers it evident from the title of the loans that they were related to "exploration" 
and therefore unrelated to the "production" of CRS.954 According to Korea, POSCO provided an 
explanation of its manufacturing pro cess in its initial questionnaire response, and this information 
was sufficient for the USDOC to determine that exploration  of [[***]] and [[***]] were unrelated 
to the production of CRS, because the loans were for exploration , not production, and for good s 
 
946 CVD CRS verification report, (Exhibit  KOR-75 (BCI)), p.  3 (fn omitted). See also Rejection of 
POSCO's  resubmission, (Exhibit  KOR-95). 
947 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  76. 
948 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  76. (fns omitted; emphasis added)  
949 United  States'  second written submission, para.  126. 
950 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), pp.  19-20. 
951 CVD CRS initial questionnaire response,  (Exhibit  KOR-70 (BCI)), exhibit  F-1, p. 1.  
952 CVD CRS initial questionnaire response,  (Exhibit KOR-70 (BCI)), pp.  27-28 and 33 -34. 
953 The USDOC found sufficient information on the record to determine that KNOC loans were tied to 
non-subject merchandise, but did not find that KORES loans were tied to non -subject merchandise. ( CVD CRS 
issues and decision memorandum,  (Exhibit  KOR-77), pp.  23-24; United  States'  response to Panel question 
No. 76, para.  114. See also HRS Sections B -C questionnaire response,  (Exhibit  KOR-56 (BCI)), pp.  23-24). 
954 Korea's  response to Panel question No.  28(a). See also Ko rea's second written submission, 
para. 169; and response to Panel question No.  77, para.  86. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 106 - 
 
  unrelated to the production of CRS.955 POSCO 's initial questionnaire response also stated that DWI 
was primarily a "trading company " with no production operations related to the subject merchandise.  
The information provided by POSCO pertaining to the use  of these program mes – in addition 
to POSCO 's express statements that the KORES and KNOC loans were tied to non -subject 
merchandise and were therefore not countervailable – was relevant to the determination made by 
the USDOC that POSCO received a measurabl e benefit from the KORES and KNOC loan 
programmes .956 Were it to be established that the loans programmes  were, in fact, unrelated to the 
production of CRS, any changes in the magnitude of the loan amounts would be irrelevant to the 
inquiry of whether POSCO benefitted from these loans. The USDOC, however, did not make any 
attempt to determine whether, in ligh t of POSCO 's statements and the supporting evidence, the 
KORES loan programme was, in fact, tied to non -subject merchandise.957 The USDOC did not take 
into account this evidence relating to the use of these loan programmes . Nor did the USDOC provide 
a reaso ned and adequate explanation as to why the alleged changes in the magnitude of the loan 
amounts would preclude reliance upon evidence concerning the use and purpose  of the loan 
programmes . In light of the record evidence suggesting that the programmes  could be unrelated to 
the production of CRS, we consider that an unbiased and objective investigating authority would 
have at least sought to ascertain certain basic aspects of the information properly before it – such 
as the use of the programmes  – notwithsta nding the timing of subsequent submissions or the 
magnitude of change in reported lending. The USDOC was not justified in finding that the loan data 
pertaining to the additional loans reported at verification by DWI amounted to missing "necessary" 
informat ion because it did not consider or explain why the other information on the record did not 
establish that these loans were unrelated to the subject merchandise.   
Accordingly, in the circumstances of this case, we find that the USDOC  acted inconsistently 
with Article  12.7 of the SCM  Agreement  in resorting to facts available with respect to information 
concerning DWI loan data as it  did not  take into account information that was submitted as part of 
POSCO 's and DWI 's direct responses before concluding that DWI had failed to provide "necessary" 
information.   
7.3.4.4.2   The USDOC 's selection of the replacement facts  
We turn now to consider Korea 's claims that the USDOC acted inconsistently with Article  12.7 
in its selection of the replacement facts.  Like Article  6.8 of the Anti -Dumping  Agreement , Article  12.7 
of the SCM  Agreement  imposes  an obligation on investigating authorities to select those facts that 
reasonably replace the missing "necessary" information.958 In selecting reasonable replacements , 
an investigating authority must take into account all facts  that are properly before it. While an 
investigating authority may take into account the procedural circumstances surrounding 
non-cooperation in its selection of the replacement facts, an authority is not permitted to select facts 
in order to punish non -cooperation.959 
7.3.4.4.2.1   Cross -owned affiliate input suppliers  
Korea argues that there was sufficient information on the record – from 
POSCO 's questionnaire responses and from verification  – to demonstrate that the inputs at issue 
were not "primarily dedicated " to the production of the subject -merchandise.960 According to Korea, 
following its finding that POSCO failed to provide "necessary " inform ation, the USDOC erroneously 
inferred that the inputs produced by the four cross -owned affiliates at issue were "primarily 
dedicated " to the production of the downstream product.  
Korea challenges the USDOC 's conclusion and identifies two pieces of informa tion provided 
by POSCO that would have allowed the USDOC to determine that the inputs at issue were not 
 
955 Korea's  response to Panel question No.  77, paras.  85-86. 
956 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), pp.  19-20.  
957 In its preliminary determination, the USDOC made such a finding for only the KNOC programme, that 
the "information on the record sufficiently demonstrates that the loans from KNOC to POSCO are tied to 
non-subject merchandise". (CVD CRS negative preliminar y determination, (Exhibit  KOR-87), p.  24). 
958 See para.  7.41 above.  
959 See para.  7.41 above.  
960 Korea's  first written submission, para.  397. Korea presents this argument as part of its claim that the 
conditions to resort to facts available were not met. However, in our view, th is argument pertains to the 
USDOC's  selection of replacement facts and as such, we address it here.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  primarily dedicated to the production of CRS. First, Korea points out that the four affiliates at issue 
were all identified in POSCO 's affiliation chart  filed at the outset of the investigation.961 Korea also 
submits that "the value of POSCO 's transactions … in relation to the cross -owned affiliates ' sales 
were part of POSCO 's consolidated financial statements", that were on the record from 
POSCO 's earlies t responses.962 Second, Korea submits that the information submitted by POSCO 
during verification also contained a list of all the raw materials that it use d for the production of CRS, 
including the suppliers for each of these inputs, and established that o nly "insignificant" amounts of 
inputs were provided by the four affiliates at issue.963 According to Korea, this information, when 
read together, indicated that the "percentage of the inputs provided to POSCO as a percentage of 
the affiliates ' total sales r anged from [[***]] to [[***]]% or between [[***]] to [[***]]% when 
measured against POSCO 's total cost of production for CR[S]  products".964 
Concerning the financial statements, the United  States  explains that "POSCO 's consolidated 
financial statements, which [the] USDOC examined in full , contain general information pertaining to 
cross-owned affiliates".965 According to the United  States , these "financial statements do not provide 
any information on whether or to what ext ent such cross -owned affiliates provided inputs that 
POSCO used in the production of subject merchandise".966 As to the information provided at 
verification, the United  States  submits that the USDOC took into account that information for 
verifying the accur acy of POSCO 's questionnaire response insofar as it was "relevant to that 
inquiry".967 
We recall that, u pon discovering at verification that, contrary to its initial responses, POSCO 
received from its cross -owned affiliate input suppliers "inputs that 'coul d' be used to produce 
downstream products"968, the USDOC determined that "POSCO withheld requested necessary 
information during the course of the investigation, impeded the proceeding, and through its actions 
prevented the [USDOC] from being able to verify that information". On these bases, the USDOC 
found that the use of " facts available " was "warranted in determining the existence of cross -owned 
affiliates that provided inputs used in the production of subject merchandise".969  
Noting that POSCO "failed to identify or provide necessary information as to its respective 
cross-owned companies" despite "repeated requests", the USDOC found that POSCO did not act to 
the "best of its ability" and that an " adverse inference  that POSCO and its cross -owned input 
suppliers received certain subsidies, benefitted from those subsidies, and that those subsidies were 
specific, is warranted in this case".970 In drawing this adverse inference, the USDOC explained that :  
Because POSCO failed to report the necessary informat ion and only after discovery at 
verification did it report on the last day that some of the inputs provided by the 
aforementioned affiliated companies were, in fact, used in the production of the subject 
merchandise, the [USDOC] concludes that inputs produ ced by POSCO Chemtech, 
POSCO P&S, POSCO MTech, and POS -HiMetal are primarily dedicated to the production 
of the downstream product, within the meaning of 19 CFR 351.525(b)(6)(iv).971  
Following its finding that POSCO failed to provide the "necessary" inform ation, the USDOC 
thus immediately inferred that the inputs produced by the four cross -owned affiliates at issue were 
 
961 Korea's  first written submission, para.  394 (referring to CVD CRS affiliated companies response, 
(Exhibit  KOR-73 (BCI)), exhibit  1). 
962 Korea's  first writt en submission, para.  394 (referring to CVD CRS initial questionnaire response , 
(Exhibit  KOR-70 (BCI)), exhibit  20).  
963 Korea's  first written submission, paras.  348 and 356 (referring to CVD CRS verification report, 
(Exhibit  KOR-75 (BCI)), p.  11; and POSCO verification exhibit  PVE-3, (Exhibit  KOR-76 (BCI))).  
964 Korea's  first written submission, para.  352; responses to Panel question No.  72(a), paras.  76-77, 
No. 72(b), paras.  78-79, and No.  72(c), para.  80. Korea explains that these figures can be derived fro m 
"[t]he  2014 audited consolidated financial statement lists POSCO's  total cost -of-sales on the income statement, 
and at verification POSCO submitted the total value of inputs sourced from each affiliate". (Ibid.).  
965 United  States'  response to Panel questi on No.  22, para.  100 (referring to CVD CRS issues and 
decision memorandum,  (Exhibit  KOR-77), p.  15). (emphasis added)  
966 United  States'  responses to Panel question No.  22, para.  100, and No.  72(d), paras.  97-105. 
967 United  States'  response to Panel question No. 74(b), para.  109. (emphasis added)  
968 United  States'  response to Panel question No.  74(a), para.  107 (referring to CVD CRS issues and 
decision memorandum,  (Exhibit  KOR-77), pp.  65-67). 
969 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  10. 
970 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  10. (emphasis added)  
971 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  69. (fn  omitted)  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  primarily dedicated to the production of the downstream product. The USDOC provided no further 
explanation as to how its finding that the i nputs supplied by these cross -owned affiliates were 
primarily dedicated to the production of the downstream product was based on positive evidence  on 
the record.  
The United  States'  assertion that the USDOC "examined in full" the consolidated financial 
statements submitted by POSCO is not supported by record evidence. The part of the final 
determination that the United  States  cites simply indicates that the USDOC applied an "AFA rate" to 
POSCO for "[v]arious grants contained in Financial Statements".972 The USDOC 's analysis does not 
explain the examination it undertook of POSCO 's financial statements, or how this examination was 
with a view to ascertaining whether the value of POSCO 's transactions in relation to the cross -owned 
affiliates ' sales were par t of POSCO 's financial statements, as alleged by Korea.973 Moreover, Korea  
does not rely upon the financial statements in isolation, but uses them together with  the information 
supplied by POSCO during verification.974  
With respect to the information provid ed at verification, we note the United  States'  argument 
that "a document listing input suppliers (including affiliated input suppliers ) would be relevant in 
verifying POSCO 's statement", but the "quantity of inputs purchased, would not be relevant to that 
inquiry".975 Be that as it may, we recall that the determination made by the USDOC was that these 
inputs were "primarily dedicated " to the production of the downstream product. Article  12.7 allows 
an investigating authority to "fill in the gaps" by using the "facts" that are "available" to it, but this 
does not serve as a license to base determinations solely upon "non -factual assumptions or 
speculation" .976 Rather, an investigating authority continues to be under an obligation to take into 
account al l facts that are properly before it in order to make determinations on the basis of 
reasonable replacements for the missing information. In the circumstances of this case, the USDOC 
ought to have taken into account the input purchase data provided at verif ication, particularly when 
the data was contained in the same document listing the input suppliers – information which the 
USDOC took into account for verification purposes – in order to select reasonable replacements for 
the missing "necessary" informatio n.  
The USDOC explained that it was not able to "verify the validity of the input amounts" due 
to the "untimely nature and large amounts of data required to fully establish the credibility of the 
submission" .977 However, the fact that the data provided at v erification may have been "untimely" 
and in "large amounts"978, and therefore it may have been "inconvenient or impractical" for the 
USDOC to take further steps to confirm the basic nature of the data, cannot outweigh the due 
process rights that are enjoyed  by interested parties throughout the course of an investigation.979 
The United  States  argues that the information concerning the value of inputs provided by POSCO is 
"not relevant to [the USDOC's] fact intensive primarily dedicated analysis because the ana lysis 
considers whether an input is primarily dedicated not the value that is dedicated".980 This, however, 
is exactly what the USDOC failed to do, i.e. to examine whether the information provided by POSCO 
was relevant  for purposes of its "primarily dedicat ed analysis".  
In sum, the determination as to whether inputs were primarily dedicated ought to have been 
made by the USDOC in light of all the facts that were properly available to it. It is clear that these 
facts included the information relating to cross -owned affiliates and their sales in 
POSCO 's consolidated financial statements submitted as a questionnaire response, as well as the 
information provided at verification. The USDOC did not consider whether the information that was 
 
972 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  15.  
973 The consolidated financ ial statements contain information on "related party transactions" with 
cross-owned affiliates for 2013 -2014 as well as the total sales figures for them. (CVD CRS initial questionnaire 
response , (Exhibit  KOR-70 (BCI)), exhibit  20, pp.  110-111).  
974 Korea's  responses to Panel question No.  72(a), paras.  76-77, No.  72(b), paras.  78-79, and 
No. 72(c), para.  80. 
975 United  States'  response to Panel question No.  74(b), paras.  108-109. (emphasis added)  
976 Appellate  Body Reports, US – Carbon Steel (India) , paras.  4.417 and 4.419; Mexico – Anti-Dumping 
Measures on Rice , para.  294; US – Countervailing Measures (China) , para.  4.178; and US – Anti-Dumping 
Methodologies (China) , para.  5.172.  
977 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  67. 
978 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  67. 
979 Panel Report, US – Supercalendered Paper , para.  7.177. See also Appellate  Body Reports Mexico – 
Anti-Dumping Measures on Rice , para.  292; and EC – Tube or Pipe Fittings , para.  138 (quoting 
Appellate  Body Report, EC – Bed Linen  (Article  21.5 – India) , para.  136).  
980 United  States'  comments on Korea's  response to Panel question No.  72(a).  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  before it indicated that the inputs at issue were primarily dedicated for the production of the 
downstream product. Upon discovering at verification that, contrary to POSCO 's questionnaire 
response, cross -owned affiliates supplied inputs that could have been used for the productio n of the 
downstream product, the USDOC simply assumed – impermissibly, in our view – that the inputs 
were primarily dedicated for the production of the downstream product without taking into account 
the information that was properly before it .981 
Accordingl y, in the circumstances of this case , we find that, in selecting the replacement 
facts, the USDOC did not  take into account all the information that was properly before it and made 
an assumption unsupported by positive evidence that the inputs supplied by the cross -owned 
affiliates discovered at verification were "primarily dedicated" to the production of the downstream 
product.  Because the USDOC erred in finding that the inputs supplied by the cross -owned affiliates 
were "primarily dedicated" to the produc tion of the CRS products at issue, it also erred in finding 
that the relevant subsidies received by these affiliates were countervailable and attributable to 
POSCO.  We therefore  find that the USDOC acted inconsistently with Article  12.7 of the 
SCM Agreemen t in its selection of the replacement facts  with respect to cross -owned affiliate input 
suppliers .  
7.3.4.4.2.2   POSCO facility in an FEZ  
We have already found that the USDOC erred in resorting to facts available with respect to 
POSCO 's facility in an  FEZ. In these circumstances, we do not consider that making further findings 
on Korea 's claims concerning the USDOC 's selection of the replacement facts on the basis of the 
record used for the USDOC 's WTO-inconsistent findings would assist in providing a positive solution 
to the dispute before us.982 
7.3.4.4.2.3   DWI loan data  
We have already found that the USDOC erred in resorting to facts available with respect to 
the DWI loan data. In these circumstances, we do not consider that making further findings on 
Korea 's claims concerning the USDOC 's selection of the replacement facts on the basis of the record 
used for the USDOC 's WTO-inconsistent findings would assist in providing a positive solution to the 
dispute before us.983 
Korea 's claims under Articles  10, 19.4, and 32 .1 of the SCM  Agreement  
Korea further claims that, as a result of the USDOC 's use of facts available inconsistently 
with Article  12.7 of the SCM  Agreement , the United  States  imposed countervailing duties "in excess 
of the amount of the subsidy found to exi st, in violation of Article  19.4", as well as in violation of 
Articles  10 and 32.1 of the SCM  Agreement .984 According to Korea, because the margin of 
countervailing duty was determined based on facts available in a manner inconsistent with 
Article  12.7, "th e countervailing duty levied automatically violated Article  19.4 of the 
SCM Agreement ".985 Moreover, Korea asserts that the violation of Article  12.7 also "automatically 
leads" to a violation of Articles  10 and 32.1 of the SCM  Agreement , as "this USDOC investigation 
and the measure taken were not in accordance with the SCM  Agreement ".986  
The United  States  responds that Korea 's claims under Articles  10, 19.4, and 32.1 are 
"entirely consequential" and "Korea offers no argument or evidence to support any in dependent 
breach of those provisions".987 According to the United  States , were the Panel to uphold 
Korea 's claims under Article  12.7, "there would be no basis to decide Korea 's consequential 
claims".988 First, the United  States  "does not concede that such breaches are 'automatic'".989 Second, 
 
981 CVD CRS issues and decision memorandum,  (Exhibit  KOR-77), p.  67. (emphasis added)  
982 See, e.g. Panel Report s, Egypt – Steel Rebar , para. 7.310; and Mexico – Anti-Dumping Measures on 
Rice, para.  7.200. See also Panel Report, China – Broiler Products , para. 7.555.  
983 See, e.g. Panel Reports, Egypt – Steel Rebar , para.  7.310; and Mexico – Anti-Dumping Measures on 
Rice, para.  7.200. See also Panel Report, China – Broiler Products , para. 7.555.  
984 Korea's  first written submission, paras.  455-456. 
985 Korea's  first written submission, paras.  451-452. 
986 Korea's  first written submission, para.  453. 
987 United  States' first written submission, para.  425. 
988 United  States'  first written submission, para.  427. 
989 United  States'  first written submission, para.  427. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  the United  States  submits that deciding such claims would be serve "no useful purpose" and would 
provide no "additional guidance that would be useful regarding implementation of any 
recommen dations adopted by the DSB".990 
Korea does not present any independent bases for the alleged breaches of Articles  10, 19.4, 
and 32.1 of the SCM  Agreement ; instead, its claims under these provisions  are dependent entirely 
upon a finding that the United  State s acted inconsistently with Article  12.7 of the SCM  Agreement .991 
In these circumstances – and having already found that the United  States  acted inconsistently with 
Article  12.7 of the SCM  Agreement  – we do not consider it necessary to rule upon Korea 's claims 
under Articles  10, 19.4, and 32.1 of the SCM  Agreement  in order to resolve the dispute before us.992 
7.3.5   Countervailing duties on certain hot -rolled steel flat products from Korea 
(USDOC  investigation number C -580-884)  
Introduction  
Korea claims that the United  States acted inconsistently with Article  12.7 of the 
SCM Agreement in the countervailing duties investigation concerning certain HRS flat products from 
Korea (the "HRS CVD investigation").993 Specifically, Korea claims that the USDOC acted 
inconsiste ntly with Article  12.7 of the SCM  Agreement by  using facts available in respect of 
three  issues:  
a. POSCO's  alleged failure to provide certain information relating to its cross -owned affiliate 
input suppliers ("cross -owned affiliate input suppliers")994; 
b. POSCO 's alleged failure to provide requested information about the POSCO Global R&D 
Centre in the FEZ  ("POSCO facility in an FEZ")995; and  
c. DWI's  alleged failure to provide requested information about the use of KORES  loans 
("DWI loan data").996 
Korea claims that POSCO did not "refuse access" to, or otherwise fail to provide "necessary" 
information or significantly impede the investigation, with respect to the three issues presented 
above.997 Furthermore, Korea claims that the USDOC disregarded verifiable informatio n that was 
submitted by POSCO acting to the best of its ability and did not engage in a comparative evaluation 
and assessment in order to arrive at an accurate determination, thus failing to select the "best 
information available".998 
We begin by setting ou t the relevant factual background of the underlying investigation, 
followed by the parties'  arguments. In section  7.3.5.4.1  we address Korea's  claims of 
WTO-inconsist ency regarding the USDOC's  resort to facts available for each of the three issues 
identified above. Finally, in section  7.3.5.4.2  we address Korea's  claims of WTO -inconsistency 
regarding the USDOC's  selection of the replacement facts.  
Factual background  
The USDOC initiated the HRS CVD investigation on 9 September 2015.999 This followed the 
initiation of the CRS CVD investigation on 17 August 2015.1000 POSCO was selected a s a mandatory 
 
990 United  States'  first written submission, para.  428. 
991 Korea's  first written submission, paras.  451-453. 
992 Panel Report, US – Carbon Steel (India) , para.  7.537.  
993 Korea's  first written submission, para.  523.  
994 Korea's  first written submission, paras. 533, 589 -609, and 634 -635. 
995 Korea's  first written submission, paras. 533, 610 -622, and 636.  
996 Korea's  first written submission, paras. 533, 623 -630, and 637.  
997 Korea's first written submission, para. 524.  
998 Korea's first written submission, paras. 527 -528 and 644 -646. 
999 CVD HRS nega tive preliminary determination, (Exhibit  KOR-105), p.  1. 
1000 CVD CRS negative preliminary determination, (Exhibit  KOR-87), p.  1. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  respondent in both investigations.1001 The USDOC conducted the two investigations simultaneously, 
with the CRS CVD investigation being further advanced given its earlier initiation date. For example, 
in the CRS CVD investigation, the USDOC issu ed its preliminary determination on 
15 December  20151002, conducted verification of POSCO in March 20161003, and issued its final 
determination on 29 July 2016.1004 These events were followed closely by the HRS CVD investigation, 
with the USDOC issuing its preliminary determination on 8 January 201 6, conducting verification of 
POSCO in May 20161005, and issuing its final determination on 12 August 2016.1006 Thus, as discussed 
below, despite the broad factual similarity between the issues in the two investigations, POSCO 
modified its responses in the HRS CVD investigation in light of the issues that it had already 
encountered in the CRS CVD investigation.  
7.3.5.2.1   The USDOC's  resort to facts available  
7.3.5.2.1.1   Cross -owned affiliate input suppliers  
In section  III of its initial questionnaire dated 24 September 2015, the USDOC requested 
complete responses for certain "'cross -owned'  affiliated companies".1007 The USDOC specified whi ch 
companies it considered "cross -owned", and in which situations responses were required, i.e. if the 
"cross -owned company supplies an input product … for production of the downstream product 
produced by the respondent".1008 
In its joint response with its a ffiliated trading company, DWI, POSCO stated that it did "not 
believe it [had] any affiliates that [met] any of the four cross -ownership criteria as defined above 
by the [USDOC]", nor that "POSCO or any of its affiliates [were] cross -owned by a third party ".1009 
DWI also responded that it did not have any cross -owned affiliat es as defined by the USDOC, 
however, it submitted a complete response to the USDOC's  questionnaire "because it is a trading 
company that was involved in POSCO's  exports of subject merchan dise to the United  States during 
the POI" .1010 
On 6 April 2016, the USDOC issued a supplemental questionnaire to POSCO.1011 Together 
with its response – filed a week later on 13 April 2016 – POSCO included a submission explaining 
that, "[i]n the course of prep aring for the upcoming verification, POSCO … discovered some issues 
with its initial questionnaire responses that it would like to clarify".1012 One of these issues pertained 
to cross -owned affiliate input suppliers and POSCO clarified "that it did have seve ral cross -owned 
affiliates that provided negligible amounts of inputs that could be used in the production of the 
downstream product (although POSCO [could not] determine if these inputs were actually used to 
produce the subject merchandise during the POI) ".1013 It noted, however, that under the 
USDOC's  regulations, any subsidies to these affiliated companies were not attributable to POSCO 
because the production of the inputs w as not "primarily dedicated" to the production of the subject 
merchandise.1014 POSCO also provided a list of inputs purchased from cross -owned affiliates that 
could be used in the production of the downstream product, along with the values of those sales as 
a percentage of the cross -owned affiliates'  total sales.1015 This information alleged ly demonstrated 
that any inputs supplied by the cross -owned affiliates represented an insignificant part of their total 
 
1001 CVD HRS negative preliminary determination, (Exhibit  KOR-105), p.  2; CVD CRS negative 
preliminary determination, (Exhibit  KOR-87), p.  2. 
1002 CVD CRS negative preliminary determination, (Exhibit  KOR-87). 
1003 CVD CRS verification report, (Exhibit  KOR-75 (BCI)).  
1004 CVD CRS final determination,  (Exhibit  KOR-71). 
1005 CVD HRS verification report , (Exhibit  KOR-96 (BCI)).  
1006 CVD HRS final determi nation,  (Exhibit  KOR-88). 
1007 CVD HRS affiliated companies response, (Exhibit  KOR-91 (BCI)), p.  4. 
1008 CVD HRS affiliated companies response, (Exhibit  KOR-91 (BCI)), pp.  4-5. 
1009 CVD HRS affiliated companies response, (Exhibit  KOR-91 (BCI)), p.  5. 
1010 CVD HRS affiliated companies response, (Exhibit  KOR-91 (BCI)), pp.  5-6. In the same 
questionnaire, the USDOC requested the identity of all affiliated companies, and a detailed description of the 
relationship between POSCO and DWI, and these companies – requests with which the two companies 
complied. (CVD HRS affiliated companies response, (Exhibit  KOR-91 (BCI)), pp.  3-4 and exhibits  1 and 2).  
1011 CVD HRS supplemental questionnaire response, (Exhibit  KOR-92 (BCI)).  
1012 CVD HRS supplemental questionnaire respon se, (Exhibit  KOR-92 (BCI)), p.  5. 
1013 CVD HRS supplemental questionnaire response, (Exhibit  KOR-92 (BCI)), p.  6. 
1014 CVD HRS supplemental questionnaire response, (Exhibit  KOR-92 (BCI)), p.  6 (referring to  
19 CFR 351.525, (Exhibit  KOR-80), Section (b)(6)(iv)).  
1015 CVD HRS supplemental questionnaire response, (Exhibit  KOR-92 (BCI)), p.  7 and exhibit  20. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  sales.1016 The following day, on 14 April 2016, the USDOC responded by letter explaining that the 
submission included with the supplementa l questionnaire response was not "information submitted 
in response to questionnaires", and therefore constituted "new factual information" that was 
"untimely and unsolicited".1017 
In response to the USDOC's  supplemental new subsidy allegation questionnaire dated 
26 April 2016, POSCO again attempted to submit the same information, arguing that "timeliness" 
was not an issue as the USDOC continued to collect new information, as evidenced by the new 
subsidy allegation questionnaire.1018 POSCO also argued that this  information did not substantially 
prejudice any party, and thus it was within the USDOC's  discretion to accept it.1019 On the same day 
as POSCO's  response, the USDOC again declined to take into account the "new, untimely and 
unsolicited information".1020 
During verification conducted in May 2016 , the USDOC asked POSCO and DWI to discuss 
and document  (a) corporate history, ownership, structure, and affiliations; (b)  products produced 
and exported; and (c)  location of all offices and facilities.1021 The USDOC also  asked POSCO and DWI 
to "[b]e prepared to demonstrate that none of POSCO's  other affiliated companies provided inputs 
for the production of hot -rolled steel or otherwise would fall under our attribution regulations".1022 
The USDOC's  verification report expla ins that:  
[C]ounsel for POSCO stated that another ongoing proceeding had queried 
POSCO's  reporting of possible cross -owned companies. The officials then provided us a 
list of raw material purchases by POSCO as well as a list of inputs that may go into the 
production of hot -rolled steel.  … Officials clarified that this list includes all possible inputs 
to a typical hot -rolled product, rather than all inputs purchased by POSCO. Company 
officials explained that it would not be possible to produce an exhaus tive list of all inputs 
because each product is made to a specific purchase order and the company would be 
unable to review every purchase order made during the POI. However, the list is a 
reasonable reflection of the inputs to the subject merchandise.  Additionally, company 
officials stated that, as an initial matter, because POSCO produces many products and 
is a fully integrated producer, they cannot trace every element and input to the subject 
merchandise.  
The official then continued on how it determined if any POSCO affiliate needed to provide 
a response. … Then they determined whether any of the companies provided any inputs 
that could be used to produce subject merchandise or the downstream product, and 
whether the inputs were primarily dedicated . In or der to determine which inputs were 
primarily dedicated, they looked at the value of the input supplied by the affiliated 
company. If the value of the input was small, either relative to POSCO's  cost of sales or 
relative to the total value of the affiliated  companies'  sales, they determined that it was 
not primarily dedicated .1023 
The USDOC requested further explanations for the following companies from the list presented by 
POSCO at verification:  POSCO Chemtech, POS -HiMetal, POSCO M -Tech, and POSCO P&S.1024 
 
 
1016 CVD HRS supplemental questionnaire response, (Exhibit  KOR-92 (BCI)), p.  7. 
1017 USDOC letter on CVD HRS , (Exhibit  KOR-93), p.  1. Because the new factual information  was 
submitted after the latest period available for the submission of such information – 30 days before the 
preliminary determination – the USDOC explained it "cannot accept this new, untimely and unsolicited 
information for this proceeding". (Ibid.).  
1018 CVD HRS supplemental new subsidy allegation questionnaire response , (Exhibit  KOR-94 (BCI)), 
pp. 5-6 and 8 -9. 
1019 CVD HRS supplemental new subsidy allegation questionnaire response , (Exhibit  KOR-94 (BCI)), 
pp. 5-7. 
1020 Rejection of POSCO's  resubmission, (Exhibit  KOR-95). 
1021 CVD HRS verification report , (Exhibit  KOR-96 (BCI)), p.  4. 
1022 CVD HRS verification report , (Exhibit  KOR-96 (BCI)), p.  4. 
1023 CVD HRS verification report , (Exhibit  KOR-96 (BCI)), pp.  4-5. 
1024 CVD HRS verific ation report , (Exhibit  KOR-96 (BCI)), p.  5. These were the same four companies at 
issue in the CRS CVD investigation. See para.  7.237  above.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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In its final determination , the USDOC found that POSCO failed to provide questionnaire 
responses for certain input suppliers , and that it had incorrectly stated that no affiliates provided 
inputs to its production of subject merchandise:  
POSCO failed to satisfy its statutory duty to reply accurately and completely to requests 
for necessary information regarding its affiliates, p ursuant to section  776(a)(1)  of the 
Act. … Without the complete, accurate and reliable data upon which to attribute the 
unreported companies'  subsidies to POSCO, the [USDOC] cannot accurately calculate 
POSCO's  CVD subsidy rate for this final determination.  Consequently, we determine that 
because POSCO withheld necessary information, failed to provide such information by 
the deadlines for submission, and significantly impeded the investigation, we find that 
the use of facts available is warranted in accordan ce with sections 776(a)(1)  and (2)  of 
the Act.1025 
7.3.5.2.1.2   POSCO facility in an FEZ  
In its initial questionnaire , the USDOC asked POSCO certain questions regarding subsidies 
to companies located in an FEZ.1026 Both POSCO and DWI replied that they had no facilities loc ated 
in an FEZ  and were therefore not eligible for and did not receive any tax reductions, exemptions, 
grants, or financial support under any of the three programmes listed in the USDOC's  question.1027 
Additionally, the GOK in its initial response stated tha t, during the investigation period, none of the 
respondents received any benefit under the FEZ programmes, referring specifically to the 
Incheon  FEZ, among others.1028 
In its supplemental questionnaire response , POSCO clarified that it had certain facilities  
located in FEZs, however it confirmed that it did not receive any FEZ -related benefits since it was 
not an eligible foreign -invested enterprise.1029 The USDOC rejected POSCO's  attempted clarification 
with respect to POSCO facilities in an FEZ as constitutin g unsolicited and new factual information.1030 
POSCO made a second attempt to clarify its initial response in its new subsidy allegation 
questionnaire response. POSCO  argued that "timeliness" was not an impediment for the USDOC to 
accept the information sinc e the USDOC continued to collect new information, and , as this 
information did not substantially prejudice any party, it was within the USDOC's  discretion to accept 
it.1031 On the same day, the USDOC again declined to take into account this "new, untimely an d 
unsolicited information".1032 
During verification , POSCO presented what it considered to be "minor corrections", including 
the "clarification" that POSCO maintained a Global R&D Centr e located in Songdo International City, 
which is part of the Incheon FEZ.1033 The USDOC accepted this clarification as a "minor correction", 
but explained that it would not verify the use or non -use of the alleged FEZ programmes as POSCO 
had "only stated that the company had no facilities located in an FEZ".1034 
In the final determ ination , the USDOC rejected POSCO's  claim that it did not receive any 
benefits because it, in fact, had a facility located in an FEZ.1035 The USDOC also rejected 
POSCO's  argument that it could not have benefitted from this programme on the basis that it was 
designated to attract foreign investment.1036 According to the USDOC, certain shareholders of 
POSCO appeared to be foreign and thus POSCO could have been eligible to receive funding.1037 
 
1025 CVD HRS issues and dec isions memorandum , (Exhibit  KOR-98), p.  61. 
1026 CVD HRS initial questionnaire response,  (Exhibit  KOR-90 (BCI)), p.  45. 
1027 CVD HRS initial questionnaire response,  (Exhibit  KOR-90 (BCI)), p.  45. 
1028 CVD HRS GOK questionnaire response,  (Exhibit  KOR-100), pp.  67-68 and exhibit  FEZ-1. 
1029 CVD HRS supplemental questionnaire response,  (Exhibit  KOR-92 (BCI)), pp.  5-6. 
1030 USDOC letter on CVD HRS,  (Exhibit  KOR-93). 
1031 CVD HRS supplemental new subsidy allegation questionnaire response,  (Exhibit  KOR-94 (BCI)), 
pp. 5-7. 
1032 Rejection of POSCO's  resubmission,  (Exhibit  KOR-95). 
1033 CVD HRS POSCO minor corrections, (Exhibit  KOR-99), p.  1 and attachment 3.  
1034 CVD HRS verification report,  (Exhibit  KOR-96 (BCI)), p.  3. 
1035 CVD HRS issues and decisions memorandum,  (Exhibit  KOR-98), p.  69. 
1036 CVD HRS issues and decisions memorandum,  (Exhibit  KOR-98), pp.  69-70. 
1037 CVD HRS issues and decisions memorandum,  (Exhibit  KOR-98), pp.  69-70. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  The USDOC concluded that POSCO did not act to the best of its ability and  that the application of 
facts available with an adverse inference was therefore warranted.1038 
7.3.5.2.1.3   DWI loan data  
In its initial questionnaire , the USDOC requested details regarding all assistance received 
during the POI under the KORES  and KNOC  loan programmes.1039 DWI responded that it had 
outstanding long -term borrowings from KORES and KNOC during the POI. It explained, however, 
that these loans were tied to non -subject merchandise and were unrelated to DWI's  exports to the 
United  States of subject me rchandise produced by POSCO.1040 
The USDOC issued a supplemental questionnaire  requesting DWI to provide a complete 
questionnaire response regarding investments using KORES and KNOC loans.1041 DWI respond ed 
that it had reported only [[***]] that it received under these programmes during the POI, as 
opposed to [[***]].1042 DWI provided a chart listing the loans it had received under these 
programmes.1043  
The USDOC subsequently issued a new subsidy allegation q uestionnaire.  In response, 
POSCO sought to clarify, inter alia , issues regarding certain KORES loans received by DWI.1044 
POSCO reported that DWI received additional funding for two projects ( [[***]] and [[***]]), for 
which it had also received loans pursuan t to Korea Export Import Bank's  (KEXIM)  Overseas 
Investment Credit programme .1045 POSCO also argued that these loans were not tied to subject 
merchandise, and therefore any benefit could not be attributed to the subject merchandise.1046 The 
USDOC declined to t ake into account this information on the basis that it was "new, untimely and 
unsolicited".1047 
POSCO and DWI again attempted to report this additional funding during verification  as a 
"minor correction", however , the USDOC did not accept it and declined to verify the loans.1048 In its 
final determination , the USDOC explained that it did not accept this information as a "minor 
correction" because it constituted a "significant change in the magnitude of the funding provided 
under the program".1049 The USDOC reject ed POSCO's  argument that the KORES programme was 
verified in its entirety, recalling that it had declined to verify the additional loans provided.1050 
The USDOC found that DWI withheld necessary information regarding the use of the KORES 
programme and thus t he use of facts available was  warranted .1051 
7.3.5.2.2   The USDOC's  selection of the replacement facts  
The USDOC found that:  
[G]iven the information reported in its questionnaire response, and the conflicting 
information discovered at verification, we determine that PO SCO withheld requested 
necessary information during the course of the investigation, impeded the proceeding, 
and through its actions prevented the [USDOC] from being able to verify that 
 
1038 CVD HRS issues and decisions memorandum,  (Exhibit  KOR-98), p.  69. 
1039 CVD HRS initial questionnaire response, (Exhibit  KOR-90 (BCI)), p.  31. 
1040 CVD HRS initial questionnaire response, (Exhibit  KOR-90 (BCI)), pp.  31-32. Specifically, DWI 
reported that the KNOC loans were related to investments in the exploration and productio n of [[ ***]], while 
the KORES loans were related to investments in [[ ***]]. (Ibid.).  
1041 CVD HRS supplemental questionnaire, (Exhibit  KOR-101), p.  4. 
1042 CVD HRS supplemental questionnaire response, (Exhibit  KOR-102 (BCI)), exhibit  E-11, pp.  1-2. 
See para. 7.241  above.  
1043 CVD HRS supplemental questionnaire response, (E xhibit  KOR-102 (BCI)), exhibit  E-12. 
1044 CVD HRS supplemental new subsidy allegation questionnaire response , (Exhibit  KOR-94 (BCI)), 
p. 9. 
1045 CVD HRS supplemental new subsidy allegation questionnaire response , (Exhibit  KOR-94 (BCI)), 
p. 9. 
1046 CVD HRS supplemen tal new subsidy allegation questionnaire response , (Exhibit  KOR-94 (BCI)), 
pp. 9-10. 
1047 Rejection of POSCO's  resubmission,  (Exhibit  KOR-95). 
1048 CVD HRS verification report , (Exhibit  KOR-96 (BCI)), p.  3. 
1049 CVD HRS issues and decisions memorandum , (Exhibit  KOR-98), p.  72. 
1050 CVD HRS issues and decisions memorandum , (Exhibit  KOR-98), p.  72. 
1051 CVD HRS issues and decisions memorandum , (Exhibit  KOR-98), p.  72. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 115 - 
 
  information. Therefore, the [USDOC] determines that the use of facts a vailable … is 
warranted in determining the existence of cross -owned affiliates that provided inputs 
used in the production of subject merchandise.  
We further find that an adverse inference is warranted, pursuant to section  776(b)  of 
the Act. POSCO failed to identify or provide necessary information as to its respective 
cross-owned companies. Additionally, we find that POSCO failed to report that one of 
its facilities is located in a FEZ and that DWI failed to report certain loans. As a result, 
we find that  POSCO did not act to the best of its ability in this investigation. Accordingly, 
we find that an adverse inference that POSCO and its cross -owned input suppliers 
benefited from those subsidies is warranted in this case.1052 
The USDOC explained that in applying AFA to POSCO, it was guided by the "methodology" 
whereby it selected "the highest calculated program -specific rates determined for a cooperating 
respondent in the same investigation, or, if not available, rates calculat ed in prior CVD cases 
involving the same country".1053 The USDOC found that POSCO benefitted from all programmes 
under investigation, but excluded programmes determined not to be countervailable.1054 The USDOC 
calculated a CVD rate of 57.04% for POSCO.1055 
Main arguments of the parties  
7.3.5.3.1   The USDOC's  resort to facts available  
Korea claims that, for each of the three issues, the USDOC acted inconsistently with 
Article  12.7 of the SCM  Agreement as the conditions for resorting to the facts available were not 
met.1056 With respect to each issue, Korea argues  that no information was "discovered" by the 
USDOC , but, instead,  POSCO "reported the relevant information from the outset, and then offered 
additional clarification well before the verification when similar issues  arose in the further progressed 
[CRS] CVD Investigation".1057 Referring to the findings in US – Hot-Rolled Steel , Korea contends that 
additional information with respect to each issue was provided in a timely manner despite the fact 
that it was submitted af ter the relevant deadlines.1058 
The United  States submits that the USDOC did not take the additional information into 
account as it was provided several months after the expiry of the applicable  deadlines.1059 
The United  States also takes issue with Korea's  reliance on US – Hot-Rolled Steel , arguing that the 
factors identified by the Appellate  Body in that case do not find any basis in the text of the covered 
agreements.1060 According to the United  States, Korea ignores the number of days by which the 
interested party missed the deadline.1061 The United  States asserts that accepting information nearly 
four months after the relevant deadline would have likely compromised the USDOC's  ability to 
conduct the investigation expeditiously, and would have undermined the "effectiveness and 
efficiency " of the proceedings.1062 
7.3.5.3.1.1   Cross -owned affiliate input suppliers  
Korea argues that POSCO did not refuse to provide necessary information concerning certain 
cross-owned affiliated input suppliers.1063 Korea explains that – unlike the si tuation in the CRS CVD 
investigation – POSCO attempted to provide the information more than a month before verification 
in the investigation at issue.1064 Korea argues that the information regarding inputs provided by 
 
1052 CVD HRS issues and decisions memorandum , (Exhibit  KOR-98), pp.  9-10. 
1053 CVD HRS issues and decisions memor andum , (Exhibit  KOR-98), p.  11. 
1054 CVD HRS issues and decisions memorandum , (Exhibit  KOR-98), p.  12. 
1055 CVD HRS issues and decisions memorandum , (Exhibit  KOR-98), p.  17. 
1056 Korea's  first written submission, paras.  588 and 631.  
1057 Korea's  second written submiss ion, paras.  232-233. 
1058 Korea's  second written submission, paras.  237-238 (referring to Appellate  Body Report, 
US – Hot-Rolled Steel , paras.  87-89; and Panel Report, US – Hot-Rolled Steel , paras.  7.54-7.55 and 7.57).  
1059 United  States'  second written submission, paras.  129-139. 
1060 United  States'  second written submission, paras.  134-135. 
1061 United  States'  second written submission, para.  138. 
1062 United  States'  second written submission, para.  138. 
1063 Korea's  first written sub mission, para.  597. 
1064 Korea's  first written submission, para.  597. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  POSCO's  cross-owned affiliates was not " necessary" as those inputs were not "primarily dedicated" 
to the production of the subject merchandise, and because it could not be determined whether the 
inputs were actually used in the production of HRS.1065 As to the issue of timeliness, Korea argues 
that the requested information was provided within a reasonable period of time , as part of its 
supplemental responses dated 13 April 2016 and 3 May 2016, as well as at verification.1066 In any 
event, Korea contends that the values of these transactions were alr eady on the record as part of 
POSCO's  initial submission of its consolidated financial statements.1067 Finally, given that POSCO 
itself alerted the USDOC to this issue, Korea argues that POSCO acted to the best of its ability and 
did not impede the investiga tion.1068 
The United  States responds that it was only after the "discovery " at verification in the 
CRS CVD investigation that POSCO submitted the information in this investigation, nearly 
four months after the deadline for submitting new factual information had passed.1069 The 
United  States also submits that, besides being untimely and unsolicited, this information was 
included as part of the supplemental questionnaire response pertaining to a request for different 
information, and was therefore rejected by the USDOC for be ing unrelated to its request.1070 The 
United  States notes that the USDOC had requested POSCO to identify the inputs provided by 
affiliated parties, and not to conduct a "primarily dedicated" analysis.1071 The United  States argues 
that, had POSCO responded that  it had cross -owned affiliate input suppliers, the USDOC would have 
requested further information from those suppliers.1072 
7.3.5.3.1.2   POSCO facility in an FEZ  
Korea argues that POSCO provided information with respect to its facility in an FEZ over a 
month before the planned verification.1073 Korea explains that POSCO provided this information as 
a "clarification ", and it was consistent with the response already provided by the GOK.1074 Therefore, 
according to Korea, the information requested was provided within a reas onable period.1075 Korea 
contends that timeliness was not an issue since the USDOC was still issuing supplemental 
questionnaires when POSCO submitted the information, meaning that it was still collecting new 
information.1076 Korea further argues that there was  no "necessary" information missing, as there 
was a significant amount of record evidence that would have allowed the USDOC to fill in any possible 
gap and find that POSCO did not benefit from any FEZ programme.1077 Korea contends that the 
USDOC could have r equested to visit POSCO's  R&D facility to verify that it did not receive a benefit; 
however, it did not do so and the United  States should not conflate the factual situation of this 
investigation with the CRS CVD investigation.1078 
The United  States responds  that the information was rejected because it was untimely and 
unsolicited and the USDOC clearly indicated that verification could not be used for the submission of 
new information.1079 According to the United  States, nothing in the SCM  Agreement obliges an 
investigating authority to take into account information submitted well after the "factual 
deadline".1080 Furthermore, the United  States explains that the purpose of verification is to verify 
the response provided by a company against that company's  records.1081 Therefore, the USDOC 
allowed the "minor correction" that POSCO had a facility in an FEZ because it was relevant to 
POSCO's  previous reporting regarding whether they had a facility in an FEZ.1082 However, the USDOC 
 
1065 Korea's  first written submission, paras.  590-593. 
1066 Korea's  first written submission, paras.  595-596. 
1067 Korea's  first written submission, paras.  595-596. 
1068 Korea's  first written submission, para.  607. 
1069 United  States'  first written submission, para.  378. 
1070 United  States'  first written submission, para.  378. 
1071 United  States'  second written submission, paras.  109-112. 
1072 United  States'  response to Panel questio n No.  81(a), paras.  118 and 121.  
1073 Korea's  first written submission, para.  558. 
1074 Korea's  second written submission, para.  232. 
1075 Korea's  first written submission, paras.  617-619. 
1076 Korea's  second written submission, para.  242. 
1077 Korea's  first written subm ission, paras.  611-616. 
1078 Korea's  second written submission, para.  245. 
1079 United  States'  first written submission, para.  384.  
1080 United  States'  second written submission, para.  122. 
1081 United  States'  response to Panel question No.  82, para.  125. 
1082 United  States' response to Panel question No.  82, paras.  125-126. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  was not able to verify the use of the pro grammes because POSCO had reported that it did not 
maintain any facilities within an FEZ.1083 
7.3.5.3.1.3   DWI loan data  
Korea argues that upon discovering an "inadvertent error ", POSCO submitted information 
concerning certain additional loans under the KORES programme o n 3 May 2016 – a few weeks 
before verification – together with its response to the USDOC's  new subsidy allegation 
questionnaire.1084 Korea argues that the use of the programme was already known to the USDOC, 
and POSCO's  corrections concerned only the extent  of the use of the programme.1085 Korea contends 
that the USDOC had already found that DWI's  use of the programme was de minimis ; therefore, the 
minor additional information could not have had any meaningful impact on the benefit calculation.1086 
Korea points o ut that DWI specifically stated that the additional loans were tied to inputs not used 
in the production of the subject merchandise.1087 Even though these loans were not relevant for this 
investigation – as there was no benefit attributed to the production o f HRS – DWI submitted these 
additional loans in order to complete the information provided earlier.1088 
The United  States maintains that, as with the other information discovered during 
verification in the CRS CVD investigation, POSCO tried to put untimely a nd unsolicited information 
on the record of this investigation twice, but it was rejected by the USDOC.1089  
7.3.5.3.2   The USDOC's  selection of the replacement facts  
Korea claims that the USDOC acted inconsistently with Article  12.7 of the SCM  Agreement 
by drawing adv erse inferences that the cross -owned affiliates benefitted from all  the subsidy 
programmes at issue; that POSCO obtained benefits under the FEZ programme; and that DWI 
obtained a benefit under the KORES programme.1090 Korea argues that the USDOC failed to ev aluate 
comparatively all substantiated facts on the record in order to determine the "best available 
information " for arriving at an "accurate " determination.1091  
Korea  also argues that the USDOC acted inconsistently with Article  12.7 of the 
SCM Agreement by not exercising special circumspection in its selection of the subsidy rates. 
According to Korea, the USDOC failed to corroborate the selected rates and simply chose the h ighest 
calculated rates.1092 Moreover, the replacement facts were selected in a punitive manner, on the 
basis of whether they were "sufficiently adverse " to POSCO and DWI.1093 For Korea, the punitive 
character of the selected rates is evident from their "exces sive and unrealistic " nature.1094 
The United  States responds that Korea fails to establish that the USDOC selected information 
inconsistently with Article  12.7.1095 The United  States contends that Korea points to no evidence on 
the record demonstrating that it  was unreasonable for the USDOC to conclude that POSCO's  affiliated 
companies benefitted from the subsidy programmes and that the FEZ programmes were used by 
POSCO.1096 Similarly, the United  States asserts that Korea points to nothing on the record to 
demons trate that the USDOC's  determination is not accurate.1097 In response to Korea's  argument 
that the USDOC failed to use the "relevant 'verifiable'  information" on the record, the United  States 
 
1083 United  States'  response to Panel question No.  82, para.  127. (emphasis added)  
1084 Korea's  first written submission, para.  578. 
1085 Korea's  first written submission, para.  626. (emphasis added)  
1086 Korea' s first written submission, paras.  627-628. 
1087 Korea's  second written submission, para.  232. 
1088 Korea's  second written submission, para.  243. 
1089 United  States'  first written submission, para.  390. 
1090 Korea's  first written submission, paras.  639, 644 -646, and 6 51. 
1091 Korea's  first written submission, para.  640. 
1092 Korea's  first written submission, para.  651. 
1093 Korea's  first written submission, paras.  642-643 and 651.  
1094 Korea's  first written submission, paras.  648-650. 
1095 United  States'  first written submission, par a. 415. 
1096 United  States'  first written submission, para.  415.  
1097 United  States'  first written submission, para.  418. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  argues that the information submitted before verification was prop erly found to be unsolicited and 
untimely and , accordingly, it did not constitute "verifiable information on the record".1098 
Evaluation by the Panel  
7.3.5.4.1   The USDOC's  resort to facts available  
Pursuant to Article  12.7 of the SCM  Agreement, an investigating author ity may only resort 
to facts available when an interested party "refuses access to, or otherwise does not provide, 
necessary information within a reasonable period".1099 In the HRS CVD investigation, 
POSCO  attempted to submit information in relation to each of the three issues after the relevant 
deadline imposed by the USDOC, but before verification. Therefore, the main issue before us is 
whether the information provided by POSCO was submitted within a "reasonable period". The 
SCM Agreement does not define wh at constitutes a "reasonable period" for purposes of Article  12.7. 
Referring to the Appellate  Body's  discussion of Article  6.8 and Annex  II of the 
Anti-Dumping  Agreement in US – Hot-Rolled Steel , Korea identifies the factors that an investigating 
authority  must consider in determining whether information was submitted within a "reasonable 
period".1100 We do not consider it necessary to opine upon the relevance of the factors propounded 
by the Appellate  Body in that dispute in the abstract. That said, for pres ent purposes, we note that 
the use of the term "reasonable" in Article  12.7 of the SCM  Agreement implies "a degree of flexibility  
that involves consideration of all of the circumstances of a particular case. What is 'reasonable'  in 
one set of circumstances  may prove to be less than 'reasonable'  in different circumstances".1101 
Although the SCM  Agreement envisages that investigating authorities can impose time -limits 
for responses, the mere fact that information is provided after the expiry of such time -limits  does 
not, without more , establish that the information was not provided within a "reasonable period" 
under Article  12.7.1102 Article  12 – entitled "Evidence" – uses both the terms "time -limit" and 
"reasonable period".1103 In our view, the drafters'  careful ch oice of words also implies that they carry 
different meanings. This supports our understanding that a time -limit imposed by an investigating 
authority does not ipso facto  constitute a "reasonable period" in all circumstances. While it is proper 
for an inve stigating authority to attach importance to time -limits fixed for questionnaire responses, 
in determining whether information is submitted within a reasonable period of time, an investigating 
authority is required to do more than merely establish that a de adline was exceeded. In this sense, 
Article  12.7 strikes a balance between "the rights of the investigating authorities to control and 
expedite the investigating process, and the legitimate interests of the parties to submit information 
and to have that in formation taken into account".1104 Exactly what factors may be considered by an 
investigating authority – in addition to the expiry of the relevant deadline – remains a function of 
the specific facts and circumstances of a given case.1105 With this understandi ng, we turn to examine 
Korea's  claims with respect to the USDOC's  resort to facts available in relation to each of the 
three  issues.  
7.3.5.4.1.1   Cross -owned affiliate input suppliers  
Korea argues that no "necessary" information was missing as the inputs provided by the 
cross-owned companies were not "primarily dedicated" to the production of the subject merchandise, 
and, in any event, the requested information was provided within a reasonable period of time.1106 
 
1098 United  States'  first written submission, para.  424. 
1099 Article  12.7 of the SCM  Agreement. See also paras.  7.269 -7.270  above.  
1100 Korea's  second written submission, paras.  237-238 (referring to Appellate  Body Report, US – 
Hot-Rolled Steel , paras.  87-89; and Panel Report, US – Hot-Rolled Steel , paras.  7.54-7.55 a nd 7.57).  
1101 Appellate  Body Report, US – Hot-Rolled Steel , para.  84. (emphasis added)  
1102 Panel Report, US – Steel Plate , para.  7.76. 
1103 Footnote 40 to Article  12.1.1 provides, in relevant part, that "[a]s a general rule, the time -limit for 
exporters shall be counted from the date of receipt of the questionnaire". In addition, paragraph  6 of Annex  II 
to the Anti -Dumping  Agreement also distinguishes between "time -limits" and "reasonable period". Paragraph  6 
provides, in relevant part, that "[i]f evidence or info rmation is not accepted, the supplying party should be 
informed forthwith of the reasons therefor, and should have an opportunity to provide further explanations 
within a reasonable period, due account being taken of the time -limits of the investigation".  
1104 Appellate  Body Report, US – Hot-Rolled Steel , para.  86. 
1105 Appellate  Body Report, US – Hot-Rolled Steel , para.  84. 
1106 Korea's  first written submission, paras.  591 and 595.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  The United  States argues that the USDOC prope rly rejected the information submitted by POSCO as 
being "untimely and unsolicited".1107 
The USDOC, in its initial questionnaire, requested POSCO to provide "complete 
questionnaire" responses for those affiliates that were cross -owned, inter alia , in instanc es where 
the cross -owned company "supplies" an input to POSCO for "production of the downstream product 
produced by the respondent".1108 The USDOC did not limit its  query by referring to the criterion of 
"primarily dedicated" products. Instead, the USDOC's  question is broadly worded and could 
encompass information concerning all instances where inputs are supplied by a cross -owned affiliate 
for the production of the downstream product. In its response to the USDOC's  supplemental 
questionnaire submitted on 13 April 2016, POSCO explained that "it did have several cross -owned 
affiliates that provided negligible amounts of inputs that could be used in the production of the 
downstream product (although POSCO [could not] determine if these inputs were actually used to 
produce the subject merchandise during the POI)".1109 POSCO provided a list of the inputs that it 
purchased from cross -owned affiliates during the POI that could be used in the production of the 
downstream product, along with the values of those sales as a percentage of the cross -owned 
affiliates'  total sales.1110 According to POSCO, this demonstrated that any inputs supplied 
represented an insignificant part of the affiliates'  total sales, and they were not "primarily dedicated" 
to the production o f the downstream product.1111  
Through its letter dated 14 April 2016, the USDOC rejected the information concerning 
cross-owned affiliate input suppliers. The USDOC reasoned, first, that the information concerning 
cross-owned affiliate input suppliers const ituted "unsolicited new factual information" as it "was not 
related to the information requested by the [USDOC] in its supplemental questionnaire".1112 Second, 
the USDOC noted that the deadline for the submission of such new factual information under US law 
is 30 days prior to preliminary determination (in this case, the preliminary determination was issued 
on 15  January 2016).1113 Noting that the "new factual information" was submitted "after the latest 
period available for the submission of unsolicited new fa ctual information", the USDOC rejected the 
information provided as being "new, untimely and unsolicited".1114 As such, the only reason provided 
by the USDOC for rejecting the "new" information was that it was submitted after "the latest period 
available". PO SCO made a second attempt to submit the same information together with its new 
subsidy allegation questionnaire response.1115 The USDOC again rejected this "new, untimely and 
unsolicited information" provided by POSCO as it was provided after the deadline fo r the submission 
of new factual information.1116  
Thus, on both occasions that POSCO tried to submit information concerning cross -owned 
affiliate input supplie rs, the USDOC rejected POSCO's  submission for the sole reason that it was 
provided after the applic able deadline for the submission of new factual information under US law, 
i.e. 30  days before the preliminary determination. While it is undisputed that POSCO provided the 
information concerning cross -owned affiliates after the expiry of this statutory dea dline, this, in and 
of itself, does not mean that it was not provided within a "reasonable period" for purposes of 
Article  12.7 of the SCM  Agreement. As discussed, whether an interested party refuses access to, or 
otherwise fails to provide, necessary info rmation within a "reasonable period",  must be assessed in 
the specific facts and circumstances of a given case.1117 The mere fact that the information was 
provided after the relevant deadline does not, without more, establish that it was not provided within 
a "reasonable period".  
In its final determination, the USDOC found "that POSCO only provided  information at 
verification which would have allowed the [USDOC] to investigate further regarding the inputs 
provided by the companies" and that " only after disco very at verification did it report on the last day 
that some of the inputs provided by the aforementioned affiliated companies were, in fact, used in 
 
1107 United  States'  first written submission, para.  398. 
1108 CVD HRS affiliated companie s response, (Exhibit  KOR-91 (BCI)), pp.  4-5. 
1109 CVD HRS supplemental questionnaire response, (Exhibit  KOR-92 (BCI)), p.  6. 
1110 CVD HRS supplemental questionnaire response, (Exhibit  KOR-92 (BCI)), p.  7 and exhibit  20. 
1111 CVD HRS supplemental questionnaire respo nse, (Exhibit  KOR-92 (BCI)), p.  7.  
1112 USDOC letter on CVD HRS , (Exhibit  KOR-93). 
1113 USDOC letter on CVD HRS , (Exhibit  KOR-93). 
1114 USDOC letter on CVD HRS , (Exhibit  KOR-93). 
1115 See para.  7.330  above.  
1116 Rejection of POSCO's  resubmission,  (Exhibit  KOR-95). 
1117 See paras.  7.350 -7.351  above.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  the production of the subject merchandise".1118 We find that these observations by the USDOC are 
not support ed by the record evidence in so far as POSCO did, in fact, submit this information prior 
to verification, only for it to be rejected by the USDOC. The USDOC made no mention in the final 
determination of POSCO's  prior attempts to submit this information, no r did it provide any reasons 
for rejecting this information in its final determination. To this extent, these statements by the 
USDOC do not reflect conduct that would be expected from an unbiased and objective investigating 
authority.  
For the above reason s, we find that Korea has established that the USDOC acted 
inconsistently with Article  12.7 of the SCM  Agreement because it rejected the information concerning 
the cross -owned affiliate input suppliers solely  on the basis that it was provided after the tim e-limit 
imposed by the USDOC, without considering whether, in light of the specific facts and circumstances, 
the information submitted by POSCO was nonetheless submitted within a "reasonable period".1119  
7.3.5.4.1.2   POSCO facility in an FEZ  
Korea argues that the USDOC improperly resorted to the use of facts available as the 
requested information was provided by Korea within a "reasonable period".1120 The United  States 
responds that the information was rejected because it was untimely and unsolicited.1121 
In response to the USDOC's  initial questionnaire, POSCO stated that it "has no facilities 
located in a free economic zone ('FEZ')  and thus was not eligible for and did not receive any tax 
reductions, exemptions, grants or financial support under any of the three programs  listed in the 
[USDOC]'s  question".1122 Pursuant to the general instructions offered by the USDOC, the initial 
questionnaire did not inquire whether POSCO had any facilities located in an FEZ. Instead, the 
questionnaire required POSCO to "clearly state" that  it "did not apply for, use, or benefit from that 
program during the POI". Thus, information relating to the location of POSCO's  facility in an FEZ was 
not specifically requested  by the USDOC. Such information, however, was offered by POSCO in its 
response  as the basis for its assertion that it did not receive any subsidies under the FEZ 
programmes. At the same time, the GOK in its own questionnaire response stated in relation to FEZ 
benefits that , "[d]uring the investigation period, none of the respondents  received a benefit under 
this program".1123  
Following its initial response, POSCO subsequently attempted to submit a "clarification" 
regarding the FEZ issue together with its supplemental questionnaire response. POSCO clarified that 
it had certain faciliti es located in FEZs, however, as it initially stated and as confirmed by the 
GOK's  response, "it did not receive any benefits for being located in an FEZ".1124 In support, POSCO 
also noted that "it is not a foreign -invested enterprise, and as the GOK reported  the FEZ benefits 
are limited to foreign -invested enterprises".1125 The USDOC declined to accept this clarification, 
finding, instead, that it constituted "new factual information submitted to the [USDOC] after the 
latest period available for the submission of unsolicited new factual information on the record".1126 
POSCO again attempted to submit this information in a subsequent questionnaire response, while 
arguing that timeliness was not an issue, since "[t]his information did not substantially prejudice 
any party, as it was submitted in the context of a response to the [USDOC]'s  own request for 
additional and new information based on a new subsidy allegation that had been filed by the 
petitioner some 4 months ago".1127 The USDOC again rejected this information for the same reasons 
as before, i.e. it constituted unsolicited, new factual information submitted after the relevant 
deadline.1128  
 
1118 CVD HRS issues and decisions memorandum , (Exhibit  KOR-98), pp.  63 and 65. (emphasis add ed) 
1119 See, e.g. Appellate  Body Report, US – Hot-Rolled Steel , para.  89. 
1120 Korea's  first written submission, para.  617. 
1121 United  States'  first written submission, para.  408.  
1122 CVD HRS initial questionnaire response, (Exhibit  KOR-90 (BCI)), p.  45. 
1123 CVD HRS  GOK questionnaire response, (Exhibit  KOR-100), pp.  67-68. 
1124 CVD HRS supplemental questionnaire response, (Exhibit  KOR-92 (BCI)), p.  5. 
1125 CVD HRS supplemental questionnaire response, (Exhibit  KOR-92 (BCI)), p.  6. 
1126 USDOC letter on CVD HRS , (Exhibit  KOR-93). 
1127 CVD HRS supplemental new subsidy allegation questionnaire response , (Exhibit  KOR-94 (BCI)), 
pp. 5-7.  
1128 Rejection of POSCO's  resubmission, (Exhibit  KOR-95). WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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The record evidence suggests that POSCO submitted its clarifications concerning the FEZ 
issue together with its clarifications concerning the issue of cross -owned affiliate input suppliers as 
part of both its supplemental responses. The USDOC did not offer any specific or different reasons 
for rejecting the information relating to FEZs. Instead, the USDOC  rejected P OSCO's  "clarifications" 
on the FEZ issue together with its "clarifications" on the issue of the cross -owned affiliates for the 
same reason:  that the information relating to both issues was unsolicited, new factual information 
that was submitted after the a pplicable deadline.  
Finally, in its final determination, the USDOC found that "POSCO did not reveal  the fact that 
it had a facility located in an FEZ until verification" and , therefore , the USDOC "did not have an 
opportunity to follow up on [POSCO's] claim , or the GOK's  claim prior to verification" .1129 This is not 
supported by the record evidence. POSCO did, in fact, submit information prior to verification 
explaining that it had facilities in an FEZ, only for it to be rejected by the USDOC. The USDOC made 
no mention in the final determination of POSCO's  prior attempts to submit this information, nor did 
it provide any reasons for rejecting this information. To this extent, these statements do not reflect 
conduct that would be expected from an unbiased and ob jective investigating authority. The sole 
reason  for the USDOC's  rejection of the information supplied by POSCO concerning the FEZ issue 
was that it was submitted after the expiry of the applicable deadline.  
For the above reasons, we find that Korea has es tablished that the USDOC acted 
inconsistently with Article  12.7 of the SCM  Agreement because it rejected the information concerning 
POSCO's  facility in an FEZ solely  on the basis that it was provided after the time -limit imposed by 
the USDOC, without consi dering whether, in light of the specific facts and circumstances, the 
information submitted by POSCO was nonetheless submitted within a "reasonable period".1130  
7.3.5.4.1.3   DWI loan data  
Korea argues that the USDOC erred in resorting to facts available as the revised l oan data 
was provided by DWI within a "reasonable period".1131 The United  States maintains that, as with the 
other information discovered during verification, POSCO tried twice to put untimely and unsolicited 
information on the record of the investigation, which was  rejected  properly  by the USDOC.1132  
In response to the USDOC's  initial questionnaire section  concerning "[e]nergy and 
[r]esource [s]ubsidies", DWI identified certain "outstanding long -term borrowings"  from KORES  and 
KNOC during the POI.1133 DWI expla ined as follows:  
DWI's  KNOC loans are related to investments in the exploration and production of 
[[***]]. They are thus tied to non -subject merchandise and unrelated to DWI's  exports 
to the United  States of subject merchandise produced by POSCO. DWI's  KORES loans 
are related to investments in [[***]]. As with the KORES loans, these loans are tied to 
non-subject merchandise and are unrelated to DWI's  exports to the United Sates of 
subject merchandise produced by POSCO. Therefore, as it did in [ Non-Oriented 
Electrical Steel from the Republic of Korea ], the [USDOC] should determine that KORES 
and KNOC loans that are not tied to subject merchandise are not countervailable.1134 
Through its supplemental questionnaire, the USDOC requested complete responses 
"regarding investments using [KORES] and [KNOC] loans".1135 In response to the question regarding 
the eligibility criteria for the KORES programme, DWI submitted that it had "long -term foreign 
currency loans from KORES for [[***]] that are [[***]]".1136  
 
1129 CVD HRS issues and decisions memorandum , (Exhibit  KOR-98), p.  69. (emphasis added)  
1130 See, e.g. Appellate  Body Report, US – Hot-Rolled Steel , para.  89. 
1131 Korea's  first written submission, para.  626. 
1132 United  States'  first written submission, para.  390. 
1133 CVD HRS initial questionnaire response, (Exhibit  KOR-90 (BCI)), p.  32. 
1134 CVD HRS initial questionnaire response, (Exhibit  KOR-90 (BCI)), p.  32 (emphasis original). The 
reference to KORES loans in the penultimate sentence appears to be a typographical error and should instead 
refer to KNOC loans.  
1135 CVD HRS supplemental ques tionnaire, (Exhibit  KOR-101), p.  4. 
1136 CVD HRS supplemental questionnaire response, (Exhibit  KOR-102 (BCI)), exhibit  E-11, pp.  1-2. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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Subse quently, as part of its new subsidy allegation supplemental response, POSCO 
submitted – as a clarification – "additional funding from KORES" for two projects that had already 
been reported in previous questionnaire responses, as they received funding under  the KEXIM 
loans.1137 The "two projects" were " [[***]] and [[***]]".1138 DWI submitted a chart which listed 
[[***]] individual "[l]oan [a]greement [s]".1139 The "purpose of loan" for [[***]] agreements was 
listed as [[***]], and [[***]] Agreements had their state d purpose as [[***]].1140 This information 
was provided by DWI together with its second attempt at submitting "clarifications" in respect of the 
cross-owned affiliate input suppliers and POSCO's  facility in an FEZ. The USDOC rejected this 
additional informat ion on the basis that it constituted unsolicited factual information that was 
provided after the expiry of the applicable deadline.1141 The USDOC did not provide any reasons 
specific to the information concerning the DWI loan data. For example, the USDOC did  not consider 
the ease with which the data could be used to establish that the loans were related to the production 
of non -subject merchandise and not the export of HRS to the United  States.1142 
In its final determination, the USDOC stated that, "[a]t verifi cation, DWI presented a list of 
KORES loans that it had not previously reported  as a minor correction" .1143 While we do not disagree 
that DWI attempted to submit the information at verification, the USDOC does not address in its 
verification report, or final determination, the previous attempts made by POSCO and DWI to submit 
the information. All of these previ ous attempts were rejected by the USDOC. As such, the 
USDOC's  statement that the loans were not "previously reported" by DWI is not supported by record 
evidence and is not consistent with the conduct of an objective and unbiased investigating authority. 
We find that the sole reason  for the USDOC's  rejection of the information concerning the additional 
KORES loans  that was  submitted by POSCO and DWI in their new subsidy allegation supplemental 
response was that it was submitted after the expiry of the applic able deadline.  
For the above reasons, we find that Korea has established that the USDOC acted 
inconsistently with Article  12.7 of the SCM  Agreement because it rejected the information concerning 
DWI loan data solely  on the basis that it was provided after the time -limit imposed by the USDOC, 
without considering whether, in light of the specific facts and circumstances, the information 
submitted by POSCO was nonetheless submitted within a "reasonable period".1144 
7.3.5.4.2   The USDOC's  selection of the replacement facts  
We have already found that the USDOC acted inconsistently with Article  12.7 of the 
SCM Agreement in resorting to facts available with respect to each of the three issues discussed 
above. In these circumstances, we do not consider that mak ing further findings concerning the 
USDOC's  selection of the replacement facts on the basis of the record used for the 
USDOC's  WTO-inconsistent findings would assist in providing a positive solution the dispute before 
us.1145 
Korea's  claims under Articles  10, 19.4, and 32.1 of the SCM  Agreement  
Korea further claims that, as a result of the USDOC's  use of facts available inconsistently 
with Article  12.7 of the SCM  Agreement, "the United  States imposed countervailing duties in 
violation of Articles  10, 19.4, an d 32.1 of the SCM  Agreement".1146 According to Korea, because the 
margin of countervailing duty was determined based on facts available in a manner inconsistent with 
Article  12.7, "the countervailing duty levied automatically violated Article  19.4 of the 
 
1137 CVD HRS supplemental new subsidy allegation questionnaire response , (Exhibit  KOR-94 (BCI)), 
p. 9. 
1138 CVD HRS supplemental ne w subsidy allegation questionnaire response , (Exhibit  KOR-94 (BCI)), 
p. 9. 
1139 CVD HRS supplemental new subsidy allegation questionnaire response , (Exhibit  KOR-94 (BCI)), 
exhibit  21. 
1140 CVD HRS supplemental new subsidy allegation questionnaire response , (Exhibit KOR-94 (BCI)), 
exhibit  21. 
1141 Rejection of POSCO's  resubmission, (Exhibit  KOR-95). 
1142 See, e.g. paras.  7.292 -7.301  above.  
1143 CVD HRS issues and decisions memorandum , (Exhibit  KOR-98), p.  72. (emphasis added)  
1144 See, e.g. Appellate  Body Report, US – Hot-Rolled Steel , para.  89. 
1145 See, e.g. Panel Reports, Egypt  – Steel Rebar , para.  7.310; Mexico – Anti-Dumping Measures on 
Rice, para.  7.200. See also Panel Report, China – Broiler Products , para. 7.555.  
1146 Korea's  first written submission, para.  657. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 123 - 
 
  SCM Agreement".1147 Moreover, Korea asserts that the violation of Article  12.7 also "automatically 
leads" to a violation of Articles  10 and 32.1 of the SCM  Agreement, as "the USDOC Hot Rolled CVD 
investigation and the CVD measure taken were not in accordance wi th the SCM  Agreement".1148  
The United  States responds that Korea's  claims under Articles  10, 19.4, and 32.1 are 
"entirely consequential" and "Korea offers no argument or evidence to support any independent 
breach of those provisions".1149 According to the Uni ted States, were the Panel to uphold 
Korea's  claims under Article  12.7, "there would be no basis to decide Korea's  consequential 
claims".1150 First, the United  States "does not concede that such breaches are 'automatic'".1151 
Second, the United  States submits that deciding such claims would be serve "no useful purpose" 
and would provide no "additional guidance that would be useful regarding implementation of any 
recommendations adopted by the DSB".1152 
Korea does not present any independent bases for the alleged breaches of Articles  10, 19.4, 
and 32.1 of the SCM  Agreement; instead, its claims under these provisions  are dependent entirely 
upon a finding that the United  States acted inconsistently with Article  12.7 of the 
SCM Agreement.1153 In these circumstances – and having already found that the United  States acted 
inconsistently with Article  12.7 of the SCM  Agreement – we do not consider it necessary to rule upon 
Korea's  claims under Articles  10, 19.4, and 32.1 of the SCM  Agreement in order to resolve the 
dispute b efore us.1154 
7.3.6   Anti-dumping duties on large power transformers from Korea (USDOC investigation 
number A -580-867)  
Introduction  
Korea claims that the USDOC used facts available inconsistently with Article  6.8 and Annex  II 
of the Anti -Dumping  Agreement  in three administrative reviews concerning the anti -dumping duties 
imposed on LPTs.1155 
In the remand proceedings for the second administrative review (POR2)1156, the USDOC 
found that Hyundai Heavy Industries (HHI ) "refused to provide the necessary information for [the 
USDOC] to apply its capping methodology".1157 The information at issue concerned "the sale price, 
discounts, rebates and all other revenues and expenses" ("service -related revenues").1158 
In section  7.3.6.2.4  below, we address Korea 's claims that the USDOC erred in its resort to facts 
available and its subsequent selection of the replacement facts in respect of HHI 's reporting of 
service -related reven ues. 
In the third administrative review (POR3)1159, the USDOC found that HHI "significantly 
impeded this review by failing to act to the best of its ability by not providing complete and accurate 
information".1160 On the basis of four "specific examples" the USDOC found that HHI "demonstrated 
a pattern of behavior" which caused the USDOC "to question certain fundamental aspects of 
[HHI's]  reporting" .1161 Korea challenges the USDOC 's use of facts available in respect of each of the 
four "specific examples" or issues concerning HHI 's reporting of  (a) service -related revenues , 
 
1147 Korea's  first written submission, paras.  653-654. 
1148 Korea's  first written submission, para.  655. 
1149 United  States'  first written submission, para.  425. 
1150 United  States'  first written submission, para.  427. 
1151 United  States'  first written submission, para.  427. 
1152 United  States'  first written submission, para.  428. 
1153 Korea's first written submission, paras.  653-655. 
1154 Panel Report, US – Carbon Steel (India) , para.  7.537.  
1155 Korea did not pursue its "as applied" claim against the Expedited First Sunset Review of the 
Anti-Dumping Duty Order on Large Power Transformers from the Republic of Korea identified in 
paragraph  2.2(f)(iii) of this Panel Report.  
1156 POR2 covers the period 1 August 2013 to 31  July 2014.  
1157 LPT POR2 final results of redetermination,  (Exhibit  KOR-207 (revised, public version)), p.  24. 
1158 LPT POR2 final results of redetermination,  (Exhibit  KOR-207 (revised, public version)), p.  24. 
1159 POR3 covers the period 1 August 2014 to 31 July 2015.  
1160 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  4. 
1161 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  4. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 124 - 
 
  (b) home -market prices , (c) accessories , and (d ) certain sales documentation.1162 For each issue, 
Korea contends that the USDOC erred in resorting to the use of facts available1163, as well as in its 
subsequent selection of the replacement facts.1164 In section  7.3.6.3.2  below, we address 
Korea 's claims concerning the USDOC 's resort to facts available with respect to each of the four 
issues, followed by its claims concerning the USDOC 's selection of the replacement facts  in 
section  7.3.6.3.3 .  
In the fourth administrative review (POR4)1165, the USDOC applied facts available to HHI 
and Hyosung Corporation (Hyosung).1166 With respect to HHI, the USDOC identified defici encies in 
HHI's reporting of three issues and found that, "[c]ollectively", these issues demonstrated that HHI 
impeded the review1167 and "failed to put forth its maximum effort to cooperate in this review" .1168 
Korea challenges the USDOC 's resort to facts ava ilable in respect of  the three issues concerning 
HHI's (a) reporting of accessories , (b) reporting of gross unit price for certain home market sales , 
and (c ) non-disclosure of an allegedly affiliated US sales agent.1169 In section  7.3.6.4.2  below, we 
address Korea 's claims against the USDOC 's resort to facts available for HHI in respect of each of 
these three issues.  
With respect to Hyosung, t he USDOC found in POR4 that Hyosung 's failure to report or 
explain certain issues caused the USDOC "to question the reliability of the information provided" .1170 
Korea challenges the USDOC 's resort to facts available with respect to Hyosung 's reporting 
of (a) service -related revenue s, (b) an invoice that overlapped between two review periods , and 
(c) certain discounts and price adjustments.1171 In section  7.3.6.4.3  below, we address 
Korea 's claims concerning the USDOC 's resort to facts available for Hyosung with respect to each of 
the three issues.  
As to the selection of the replacement facts, the USDOC  applied "total AFA" with respect to 
both HHI and Hyosung in POR4.1172 We address Korea 's claims that the USDOC erred in its selection 
of the replacement facts with respect to both HHI and Hyosung in section  7.3.6.4.4  below. Finally, 
in relation to POR4, Korea also claims that the USDOC acted inconsistently with Article  9.4 of the 
Anti-Dumping  Agreement  by calculating the "all others rate" for three non -selected exporter s of LPTs 
on the basis of the "AFA rates" for HHI and Hyosung.1173 We address this claim in section  7.3.6.4.5  
below.  
The second administrative review (POR2)  
7.3.6.2.1   Introducti on 
Korea 's claim s in POR2 concern HHI 's reporting of service -related revenues. We begin by 
setting out the relevant factual background of the POR2 proceedings. We then summarize the 
parties ' main arguments, before examining Korea 's claims pertaining to the USDOC 's resort to facts 
available as well as its selection of the replacement facts.  
7.3.6.2.2   Factual background  
In its POR2 final determination, the USDOC calculated a dumping margin for HHI without 
using facts available.1174 However, in the reman d proceedings following a court appeal by the 
petitioner, the USDOC calculated a dumping margin of 25.51% for HHI using facts available – an 
 
1162 Korea's  first written submission, paras.  775-797 and 838 -840. 
1163 Korea 's first written submission, para.  775. 
1164 Korea's  first written submission, paras.  659 and 767.  
1165 POR4 covers the period from 1 August 2015 to 31 July 2016.  
1166 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  3.  
1167 LPT POR4 issues and decision  memorandum,  (Exhibit  KOR-211), p.  4. 
1168 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  4. 
1169 Korea's  first written submission, paras.  798-818 and 842 -845. 
1170 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  4. 
1171 Korea's  first wr itten submission, paras.  819-832 and 846 -850. 
1172 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  3. 
1173 Korea's  first written submission, para.  872. 
1174 Korea's  first written submission, para.  664. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 125 - 
 
  increase from  a margin of  4.07% in the final determination.1175 Korea challenges the USDOC 's final 
determination in t he remand proceedings (the "final redetermination").  
In its initial questionnaire, the USDOC requested HHI to report the gross unit price for US 
sales "as it appear[ed] on the invoice for sales shipped and invoiced in whole or in part".1176 
For certain field s of its questionnaire, including the field for gross unit prices, the USDOC instructed 
HHI to report, inter alia , "[a]ll price adjustments granted, including discounts and rebates", and to 
"create a separate field for reporting each additional charge" in cases that the invoice to the customer  
included "separate charges for other services directly related to the sale, such as a charge for 
shipping".1177 HHI responded by adding the price -related fields "ADDPOPRU" and "ADDPOEXPU" and 
explained as follows:  
ADDPOPRU is sales amount under a separate purchase order for services that were not 
included in the purchase order for the transformer ( e.g., supervision), but that are 
related to the transformer. ADDPOEXPU is the expense associated with the additional 
services.1178 
The USDOC issued a supplemental questionnaire requesting HHI to clarify if it considered 
"a sales amount entered under ADDPOPRU to be part of the purchase price of an LPT, even though 
the amount appeared on a separate purchase order".1179 HHI respon ded that , in light of the 
USDOC 's instructions in prior segments of the proceedings,  the gross unit price included the value 
of services "[w]here the terms of sale require[d] [HHI] to perform such services" .1180 HHI explained 
that, "[i ]n accordance with the [USDOC] 's decision in the Original Investigation, where the customer 
has issued a separate, additional purchase order for services related to, but not included in the 
purchase order for the sale, [HHI]  has reported the value of the a dditional purchase order and 
related expenses separately ( i.e., in fields ADDPOPRU and ADDPOEXPU)".1181 HHI also clarified that 
the sales amount reported as ADDPOPRU was not included in the reported gross unit price 
(GRSUPRRU ), and the corresponding expense (ADDPOEXPU ) was not included as part of a sales 
expense.  
In its final determination, the USDOC rejected the petitioner 's assertion that HHI had failed 
to report reimbursed expenses from services , and, as a result , HHI had misstated the gross unit 
prices.1182 The USDOC did not understand the US sales at issue to satisfy the conditions under which 
reimbursed expenses arose and therefore did not require them to be separately reported.1183 
As such, the USDOC did not apply its capping methodology, i.e. its practice of capping the reported 
service -related revenues by the actual expenses in order to avoid the overstatement of gross unit 
prices.1184 Finding the reported gross unit price for each sale to be the appropriate basis for the 
calculation of the export price for the final dumping margin1185, the USDOC declined the 
petitioner 's request to "at least apply partial facts available"  as follows : 
Specifically, we cannot conclude that necessary information is not available on the 
record, nor can we find that [HHI]  withheld information requested by the [USDOC] , that 
it failed to provide such information in the form or manner requested, that it acted to 
significantly impede the proceeding, or that it provided requested information that could 
not be verified. As discussed in re sponse to the other comments filed for these final 
results, [HHI]  has complied with all of our requests for information, and the necessary 
information requested by the [USDOC]  and provided by [HHI]  is sufficient to determine 
[HHI] 's final dumping margin for this review period.1186 
 
1175 Korea's  first written submission, paras.  676 a nd 684.  
1176 LPT POR2 initial questionnaire,  (Exhibit  USA-23), p.  C-20. 
1177 LPT POR2 initial questionnaire,  (Exhibit  USA-23), p.  C-18. (emphasis omitted)  
1178 LPT POR2 Sections B -C questionnaire response,  (Exhibit  USA-24 (BCI)), p.  C-28. 
1179 LPT POR2 supplemental Sections B -C questionnaire response,  (Exhibit  KOR-248 (BCI)), p.  14. 
1180 LPT POR2 supplemental Sections B -C questionnaire response,  (Exhibit  KOR-248 (BCI)), pp.  14-15. 
1181 LPT POR2 supplemental Sections B -C questionnaire response,  (Exhib it KOR-248 (BCI)), p.  15. 
1182 LPT POR2 issues and decisions memorandum,  (Exhibit  KOR-110), pp.  38-40. (emphasis added)  
1183 LPT POR2 issues and decisions memorandum,  (Exhibit  KOR-110), p.  40. 
1184 LPT POR2 final results of redetermination,  (Exhibit  KOR-207 (revised, public version)), pp.  6-7.  
1185 LPT POR2 issues and decisions memorandum,  (Exhibit  KOR-110), p.  40. 
1186 LPT POR2 issues and decisions memorandum,  (Exhibit  KOR-110), p.  50. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 126 - 
 
  
The petitioner appealed certain aspects of the USDOC 's final determination to the US Court 
of International Trade ( USCIT )1187, arguing, inter alia , that the USDOC failed to cap the revenues 
that HHI had included "in its gross  unit prices for subject merchandise for sales -related services that 
were separately purchased by the customer by the amount of the related expenses incurred by [HHI]  
on those services".1188 The USDOC requested – and was granted – a voluntary remand to evalu ate 
its treatment of service -related revenues.1189 In its draft redetermination in the remand proceedings 
(the "draft redetermination"), the USDOC determined that it would cap the service -related 
revenues.1190 According to the USDOC, the documentation it re -examined indicated that, for certain 
US sales sequence  number s (SEQUs), the price charged to the final customer included revenues that 
were dedicated to various services, and  that these revenues exceeded the related service 
expense.1191 The USDOC found that HH I had overstated the gross -unit prices and had not separately 
reported service -related revenue.1192 The USDOC thus found that the conditions for resorting to facts 
available were met:  
After re -examining the record evidence, we find that applying [the USDOC] 's standard 
practice to cap [HHI] 's service -related revenues by the corresponding expense is 
warranted . However, because necessary information is missing from the record due to 
[HHI] 's failure to report service -related revenues, as [the USDOC]  requested, we find 
that [HHI]  impeded this review by failing to provide information necessary for [the 
USDOC]  to apply its standard capping methodology . Therefore, we find that the 
application of facts available is warranted in order to cap [HHI] 's servic e related 
revenues by the associated expenses.1193 
HHI alleged multiple deficiencies in the USDOC 's draft redetermination with respect to 
service -related revenues.1194 HHI argued that in the draft redetermination, the USDOC abandoned 
the "Original Test" applie d in the original investigation, the POR1 review, as well as the POR2 final 
determination, and used instead a "New Test" in order to determine whether service -related revenue 
existed.1195 According to HHI, under the "Original Test", "service -related revenue existed only if 
[HHI]  was not required to provide a service under the terms of sale and [HHI]  nevertheless provided 
the service for a separate amount", while under the "New Test", "service -related revenue exists if 
certain sales documents identified revenu e for the service, regardless of whether [HHI]  was required 
to provide the service under the terms of sale".1196 
For HHI, there was no basis for the USDOC 's resort to facts available as it did not notify HHI 
of any deficiencies in its reporting, and it did not give an opportunity to provide information that was 
relevant for the "New Test".1197 Even assuming that the USDOC had valid grounds for using facts 
available, HHI argued there was no basis for drawing adverse inferences, as the USDOC did not 
clearly articulate how HHI "failed to act to the best of its ability".1198 Finally, HHI argued that the 
draft redetermination failed to acknowledge the USDOC 's prior treatment of HHI 's service -related 
revenues and the USDOC 's confirmation that HHI had properly reported this information.1199 
HHI noted that the documents allegedly s howing service -related revenues were available to the 
USDOC well in advance of verification, as was HHI 's methodology for reporting service -related 
revenue s.1200 According to HHI, the USDOC could not fault HHI for a "failure" to report information 
 
1187 LPT POR2 court remand,  (Exhibit  KOR-206 (BCI)); United  States'  first written submission, 
para. 204. 
1188 LPT POR2 court remand,  (Exhibit  KOR-206 (BCI)) , p. 3. 
1189 United  States'  first written submission, para.  204. The USDOC's  final determination in the remand 
proceedings was partially affirmed by the USCIT.  The matter was again remanded to the USDOC, these 
proceedings were ongoing at the time of this dispute. Korea's  challenge in the current dispute pertains to the 
final determination in the first remand proceedings. (Korea's  response to Panel question No.  32, p. 30). 
1190 LPT POR2 draft results of redetermination,  (Exhibit  KOR-207 (public version)), p.  13. 
1191 LPT POR2 draft results of redetermination,  (Exhibit  KOR-207 ( public version )), p. 12. 
1192 LPT POR2 draft results of redetermination,  (Exhibit  KOR-207 ( public  version )), p. 13. 
1193 LPT POR2 draft results of redetermination,  (Exhibit  KOR-207 ( public version )), p. 11. 
(emphasis  added)  
1194 LPT POR2 HHI comments on draft redetermination, (Exhibit  KOR-114 (BCI)), p.  2. 
1195 LPT POR2 HHI comments on draft redetermination, ( Exhibit  KOR-114 (BCI)), pp.  2-3. 
1196 LPT POR2 HHI comments on draft redetermination, (Exhibit  KOR-114 (BCI)), pp.  2-3. 
1197 LPT POR2 HHI comments on draft redetermination, (Exhibit  KOR-114 (BCI)), pp.  8-10. 
1198 LPT POR2 HHI comments on draft redetermination, (Exh ibit KOR-114 (BCI)), pp.  10-12. 
1199 LPT POR2 HHI comments on draft redetermination, (Exhibit  KOR-114 (BCI)), pp.  17-18. 
1200 LPT POR2 HHI comments on draft redetermination, (Exhibit  KOR-114 (BCI)), p.  17. The sequence 
numbers in question that the USDOC examined  during verification were SEQUs [[ ***]]. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 127 - 
 
  under the revised interpretation of service -related revenues of 2018, when it had submitted its 
responses in  2015.1201 HHI also argued that the USDOC should have notified HHI of the change in 
its interpretation.1202 In any event, HHI argued that if the USDOC would conti nue to apply this new 
test in the final redetermination, it had to reopen the factual record .1203 
In its final redetermination in the remand proceedings, the USDOC addressed  
HHI's argument that the USDOC had changed its methodology in its redetermination by stating that 
it voluntarily sought remand specifically to examine the capping methodology as its "understanding 
of the information continues to evolve".1204 The USDOC explained that , "[b]ased on the plain 
language of the law and [the USDOC] 's regulations, it  has been [the USDOC] 's stated practice to 
decline to treat service -related revenue as an addition to U.S. price under section  1677a(c)(1 ) of 
the Act or as a price adjustment under 19 CFR 351.102(b)(38)".1205 According to the USDOC:  
If a respondent collects, as a portion of the final price to the customer, a portion of 
revenue which is dedicated to covering a service -related expense, and that 
service -related expense is less than the revenue set aside to cover the expense, then 
this is service -related  revenue which is part of the material terms of sale and must be 
capped. [HHI]  cannot prevent the application of [the USDOC] 's capping methodology 
based on a technicality concerning whether a respondent chooses to separately itemize 
service -related charges  in sales contracts or invoices. [The USDOC] 's determination in 
this remand redetermination is not a change in methodology, but is instead an 
appropriate application of our capping methodology pursuant to the statute and past 
practice.1206 
In response to HHI 's comment that it was not informed of any change in the applicable methodology, 
the USDOC stated that it had instructed HHI to report actual and estimated costs and expenses – 
information that was "necessary" for the USDOC to apply its capping methodology .1207 
The USDOC found that HHI "refused to provide the necessary information for [the USDOC] 
to apply its capping methodology"1208 and that HHI "failed to cooperate to the best of its ability by 
not providing the information requested. Therefore, partial adver se facts available [was] 
warranted" .1209 The USDOC re -examined [[***]] sales in the remand proceedings. For [[***]] sales, 
the USDOC applied facts available by reducing the gross unit price by the difference between the 
service -related expenses and service r evenues reported by HHI, expressed as a percentage.1210 
For all other sales1211, the USDOC applied facts available with an adverse inference by reducing the 
gross unit prices by the highest percentage rate difference identified in one of the [[***]] examined 
sales.1212 This resulted in a dumping margin of 25.51% for HHI.1213 
7.3.6.2.3   Main arguments of the parties  
Korea claims that the USDOC acted inconsistently with Article  6.8 of the 
Anti-Dumping  Agreement  in resorting to facts available , as HHI did not refuse access to, or otherwise 
fail to provide, "necessary" information.1214 Korea contends that the services performed under the 
terms of sale were not separate , and that the revenues for such services were correctly reported by 
HHI as part of the sales price for the LPTs.1215 According to Korea, "problems arose" in the POR2 
remand proceedings because the USDOC applied a different definition of "service -related revenue", 
 
1201 LPT POR2 HHI comments on draft redetermination, (Exhibit  KOR-114 (BCI)), p.  19. 
1202 LPT POR2 HHI comments on draft redetermination, (Exhibit  KOR-114 (BCI)), p.  20. 
1203 LPT POR2 HHI comments on draft redetermination, ( Exhibit  KOR-114 (BCI)), pp.  21-22. 
1204 LPT POR2 final results of redetermination,  (Exhibit  KOR-207 (revised, public version)) , p. 20. 
1205 LPT POR2 final results of redetermination,  (Exhibit  KOR-207 (revised, public version)) , p. 21. 
1206 LPT POR2 final results of redetermination,  (Exhibit  KOR-207 (revised, public version)) , p. 22. 
1207 LPT POR2 final results of redetermination,  (Exhibit  KOR-207 (revised, public version)) , p. 24. 
1208 LPT POR2 final results of redetermination,  (Exhibit  KOR-207 (revised, public version)) , p. 24. 
1209 LPT POR2 final results of redetermination,  (Exhibit  KOR-207 (revised, public version)) , p. 24. 
1210 LPT POR2 draft results of redetermination,  (Exhibit  USA-27 (BCI)), pp.  13-14. 
1211 Other than [[ ***]]; LPT POR2 draft results of redetermination,  (Exhibit  USA-27 (BCI)), p.  14. 
1212 LPT POR2 draft results of redetermination,  (Exhibit  USA-27 (BCI)), p.  14. 
1213 LPT POR2 final results of redetermination,  (Exhibit  KOR-207 (revised, public version)) , pp. 24 
and 32.  
1214 Korea's  first written su bmission, paras.  769 and 771.  
1215 Korea's  first written submission, para.  769. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  without explaining this new definition and without providing HHI with a re asonable opportunity to 
respond.1216 To the extent that any "necessary"  information  was missing, Korea argues that this was 
due to the USDOC 's failure to inform HHI.1217  
Korea challenges the USDOC 's "refusal" to permit HHI to submit "necessary" information in 
the remand proceedings, "after [the] USDOC changed its practice and despite … HHI's express 
request for permission to submit the data".1218 Korea emphasizes that the USDOC did not "discover" 
upon r emand any information was "hidden" by HHI, and that the sales documentation on the record 
was exactly the same for the final determination and for the remand determination. Rather, it was 
the USDOC that changed its methodology.1219 Korea argues that the United States  mischaracterizes 
the facts by stating that the USDOC "initially did not look beyond what HHI reported" as the USDOC 
accurately described what HHI had done initially and concluded that HHI 's reporting was proper.1220  
Korea does not challenge the US DOC's capping methodology1221 or the USDOC 's right to 
change its practice.1222 According to Korea, however, an investigating authority 's ability to change 
practice is restrained by the "minimum" requirement of providing notice to the interested parties 
and providing an opportunity for interested parties to submit information under the new practice.1223 
According to Korea, the USDOC was required under paragraph  6 of Annex  II to the 
Anti-Dumping  Agreement  to do so  before resorting to facts available.1224 Korea argues that the 
USDOC should have issued an additional supplemental questionnaire and accepted HHI 's request to 
reopen the record.1225 Furthermore, Korea argues that the information on the record allowed the 
USDO C to apply its standard capping methodology.1226 On this basis, Korea submits that the USDOC 
acted inconsistently with paragraphs 3 and 5 of Annex  II by failing to take into account verifiable 
and appropriately submitted information – even though it may not have been  ideal – and by finding 
that HHI had failed to act to the best of its ability.1227 
The United  States  responds that service -related revenues should have been capped in the 
final determination, but despite the USDOC 's requests to report "the sale pric e, discounts, rebates 
and all other revenues and expenses", HHI refused to provide the "necessary" information.1228 
Because of HHI 's failure, the USDOC was unable to apply its standard capping methodology.1229 
According to the United  States , the USDOC did not change its treatment of service -related revenues, 
but its understanding of HHI 's transactions and accounting "continue[d] to evolve".1230 The USDOC 
initially did not look beyond what HHI reported, but, upon re -examination of the evidence in the 
remand procee dings, found that "the fact that certain expenses 'are not on the invoice to the 
unaffiliated customer, or part of the purchase order, does not negate the fact that these are revenue, 
collected by [HHI]  from the unaffiliated customer and dedicated to cover  service expenses, and 
 
1216 Korea's  first written submission, para.  770. 
1217 Korea's  first written submission, para.  771; second written submission, para.  290. 
1218 Korea's  response to Panel question No.  35, p.  33. 
1219 Korea's  second written submission, paras.  287 and 292.  
1220 Korea's  second written submission, para.  288 (quoting United States'  first written submission, 
para. 210).  
1221 Korea's  second written submission, para.  289. 
1222 Korea's  response to Panel question No. 35, p.  33.  
1223 Korea's  response to Panel question No.  35, p.  33. See also Korea 's second written submission, 
para. 290. 
1224 Korea's  second written submission, paras.  286 and 290. Relatedly, Korea also asserts in its 
first written submission that if "neces sary" information was missing, "it was missing because the USDOC failed 
to request [it] specifically", as required under paragraph  1 of Annex  II. (Korea's  first written submission, 
para. 774).  
1225 Korea's  first written submission, para.  836. 
1226 Korea's  first written submission, para.  773 (referring to LPT POR2 draft results of redetermination,  
(Exhibit  KOR-207 ( public version )), p. 13); second written submission, para.  295. 
1227 Korea's  first written submission, para.  837. 
1228 United  States'  first written submission , paras.  221-222. 
1229 United  States'  first written submission, paras.  222 and 224. The United States submits that, in any 
event, HHI did not act to the best of its ability  as it "possessed the information necessary to report specific 
service -related revenues for specific service -related expenses, but failed to do so". ( United  States'  first written 
submission, para.  225).   
1230 LPT POR2 final results of redetermination,  (Exhibi t KOR-207 (revised, public version)), p.  20; see 
also United  States'  response to Panel question No.  35, paras.  131-139; and second written submission, 
para. 78. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 129 - 
 
  which exceed those service expenses'".1231 The United  States  argues that nothing in the 
Anti-Dumping  Agreement  requires an investigating authority to ignore certain facts simply because 
its understanding of equivalent facts was less de veloped in an earlier segment of the proceedings.1232 
Thus, the United  States'  submits that the USDOC properly resorted to facts available.1233  
Responding to Korea 's argument that the USDOC never informed HHI of the deficiencies in 
its reporting, the United  States  alleges that HHI failed to report service -related revenues and 
expenses as originally instructed by the USDOC and misled the USDOC "by mischaracterizing its 
need to report revenues and expenses separately", and thus HHI "never provided [the USDOC]  with 
an opportunity to inform [HHI]  of any deficiencies".1234 The United  States  contends that "HHI 
reported to [the] USDOC on multiple occasions that it had no service -related revenues to report" 
and for this reason "USDOC 's obligation to inform HHI of the nature of any deficiency never 
arose".1235 The United  States  points out that HHI had the opportunity to submit comments on the 
USDOC 's draft redetermination, which were addressed by the USDOC in its final redetermination.1236 
The United  States  also asserts that there was no verifiable or appropriately submitted information 
on the record for the USDOC to take into account pursuant to paragraph  3 and paragraph  5 of 
Annex  II.1237  
As to the selection of the replacement facts, Korea argues that the USDOC acted 
inconsistently with Article  6.8 and Annex  II as it did not engage in the process of reasoning and 
evaluation that was required in the circumstances.1238 Referring to the pane l's findings in Canada – 
Welded Pipe , Korea argues that the USDOC failed to provide a reasoned and adequate explanation , 
or to engage in the requisite comparative evaluation for determining how or why the highest 
calculated difference between HHI 's reported service -related expenses and revenues was a 
reasonable replacement for the allegedly missing information.1239 According to Korea, the 
USDOC 's selection of the replacement facts was not objective and fair, but, instead, was arbitrary 
and punitive in nature.1240 
The United  States  responds that the USDOC selected reasonable replacements for the 
missing information after ascertain ing their relevance and reliability based on HHI 's own reported 
information and the actual revenues.1241 According to the United  States , the USDOC engaged in a 
process of reasoning and evaluation , whereby it determined that purchase orders for [[***]] of the 
[[***]] sales examined contained the information required by the USDOC  – "meaning that HHI could 
have reported the revenues separately, but elected not to " do so.1242 According to the United  States , 
the mere fact that the result was less  favourable for HHI does not indicate that the USDOC acted in 
a punitive manner or inconsistently with Article  6.8.1243 
7.3.6.2.4   Evaluation by the Panel  
7.3.6.2.4.1   The USDOC 's resort to facts available  
Korea claims that the USDOC acted inconsistently with Article  6.8 and paragraphs 3,  5, and  6 
of Annex  II of the Anti -Dumping  Agreement  in resorting to the use of facts available in respect of 
HHI's reporting of service -related revenues.  
We recall that, in its final determination for POR2, the USDOC did not object to 
HHI's understanding of its reporting obligations and accepted the information submitted by HHI in 
 
1231 United  States'  first written submission, para.  210 (quoting LPT POR2 final results of redeter mination, 
(Exhibit  USA-29 (BCI)), p.  23-24). 
1232 United  States'  second written submission, para.  78. 
1233 United  States'  first written submission, para.  211. 
1234 United  States'  response to Panel question No.  84, paras.  135 and 142.  
1235 United  States'  first written submission, para.  218. 
1236 United  States'  response to Panel question No.  34, para. 129.  
1237 United  States'  first written submission, para.  222. 
1238 Korea's  first written submission, para.  854. 
1239 Korea's  first written submission, para.  853 (referring to Panel Rep ort, Canada – Welded Pipe , 
para. 7.133).  
1240 Korea's  first written submission, paras.  853-854. 
1241 United  States'  first written submission, para.  227. 
1242 United  States'  first written submission, para.  228. 
1243 United  States'  first written submission, paras.  227 and 229.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  the face of express objections by the petitioner. The USDOC stated that , "[a]lthough some expense 
amounts (and spare part amounts ) may have been broken out in the purchase orders, the totals on 
the purchase orders are lump -sum amounts and these amounts all tie to the invoice totals".1244 
Specifically, for the expenses that the petitioner took issue with, the USDOC found that there was 
no basis to indicate that HHI sought or obtained reimbursements for the se expenses from the 
customers and that, despite being broken out in the purchase orders,  the totals in the se purchase 
orders were "lump sum" amounts.1245 Importantly, the USDOC accepted HHI 's understanding of the 
reporting requirements, and the application of these requirements to the service -related revenues 
and expenses for the US sales at is sue after a "review of the sales traces".1246 Ultimately, the USDOC 
concluded that the record did not suggest that HHI improperly reported its sales data , and that all 
the "necessary" information had been provided.1247 Thus, as part of its POR2 final determina tion, 
the USDOC accepted the information , as well as HHI's underlying reporting basis.  
Following remand from the USCIT, the USDOC, in its draft redetermination, decided to apply 
its "standard practice to cap [HHI] 's service -related revenues by the corresponding expense" and 
found that necessary information was missing from the record due to HHI's failure to report 
service -related revenues, "as [the USDOC]  requested".1248 In its final redetermination results upon 
remand, the USDOC explained that:  
[The USDOC] 's capping methodology is not dependent upon whether a respondent must 
provide the servic e under the terms of sale as [HHI]  contends, but whether such 
services were provided and whether the revenue amounts collected for the provision of 
such services exceed the cost of those services. Neither is [the USDOC] 's capping 
methodology dependent upon  whether the service -related expenses and revenues are 
separate line -items on an invoice to the unrelated customer. … [The USDOC] 's capping 
methodology, generally, may nevertheless be applied notwithstanding whether the 
amounts are specified in sales contr acts with, or invoices to, the customer. If a 
respondent collects, as a portion of the final price to the customer, a portion of revenue 
which is dedicated to covering a service -related expense, and that service -related 
expense is less than the revenue set  aside to cover the expense, then this is 
service -related revenue which is part of the material terms of sale and must be capped. 
[HHI]  cannot prevent the application of [the USDOC] 's capping methodology based on 
a technicality concerning whether a respond ent chooses to separately itemize 
service -related charges in sales contracts or invoices. [The USDOC] 's determination in 
this remand redetermination is not a change in methodology, but is instead an 
appropriate application of our capping methodology pursua nt to the statute and past 
practice.1249 
Addressing HHI 's assertion that the USDOC did not inform it of any change in methodology or any 
deficiencies in the information supplied, the USDOC noted that : 
[The USDOC]  requested that [HHI]  report the sale price, d iscounts, rebates and all other 
revenues and expenses in the currencies in which they were earned or incurred. [The 
USDOC]  also notified [HHI]  that it expected to obtain information "with regard to actual 
and estimated costs and expenses" through December 31, 2014. 
[The USDOC] 's instructions indicate that [HHI]  should report actual and estimated 
expenses. Yet, [HHI]  refused to provide the necessary information for [the USDOC]  to 
apply its capping methodology.1250 
We note that Korea does not take issue with the USDOC 's right to change its "practice" 
relating to the reporting of service -related revenues1251 or to apply the "capping methodology" during 
 
1244 LPT POR2 issues and decisions memorandum,  (Exhibit  KOR-110), pp.  39-40. 
1245 LPT POR2 issues and decisions memorandum,  (Exhibit  KOR-110), pp.  39-40. 
1246 LPT POR2 issues and decisions memorandum,  (Exhibit  KOR-110), p.  39. 
1247 LPT POR2 issues and decisions memorandum,  (Exhibit  KOR-110), p.  50. 
1248 LPT POR2 draft results of redetermination,  (Exhibit  KOR-207 ( public version )), p. 11. 
1249 LPT POR2 final results of redetermination,  (Exhibit  KOR-207 (revised, public version)) , pp. 21-22. 
1250 LPT POR2 final results of redetermination,  (Exhibit  KOR-207 (revised, public version)) , p. 24. 
(fns omitted)  
1251 Korea's  response to Panel question No. 35, p.  33. Korea notes however that, "as pointed out in 
Korea's  opening statement for the first substantive meeting, the USDOC's  changed practice relating to 
service -related revenues does not seem as reasonable as its previous practice". (Ibid.).  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  the remand proceedings .1252 Thus, the USDOC 's ability to steer the course of its investigation, by, 
inter ali a, determining the standard for reporting service -related revenues and deciding whether to 
apply the "capping methodology " is not in dispute before  us. That said, irrespective of the reasons 
underlying the USDOC 's rejection of the information that was orig inally submitted by HHI and 
accepted by the USDOC in its final determination, the USDOC 's continues to be subject to the 
obligations under Article  6.8 and Annex  II of the Anti -Dumping  Agreement  at all times.  
The first sentence of paragraph  6 of Annex  II to the Anti -Dumping  Agreement  requires that :  
If evidence or information is not accepted, the supplying party should be informed 
forthwith of the reasons therefor, and should have an opportunity to provide further 
explanations within a reasonable period, due  account being taken of the time -limits of 
the investigation.  
Under the second sentence of paragraph  6, "[i]f the explanations are considered by the 
authorities as not being satisfactory, the reasons for the rejection of such evidence or information 
should  be given in any published determinations". Nothing in the text of paragraph  6 limits these 
obligations to certain stages of an investigation. Rather, by its terms, paragraph  6 sets out the 
obligations that investigating authorities must discharge whenever  "evidence or information is not 
accepted". In interpreting paragraph  6 of Annex  II, we also consider important the context provided 
by Article  6.2 of the Anti -Dumping  Agreement , which provides, in relevant part, that:  
Throughout the anti -dumping investigation  all interested parties shall have a full 
opportunity for the defence of their interests. To this end, the authorities shall, on 
request, provide opportunities for all interested parties to meet those parties with 
adverse interests, so that op posing views may be presented and rebuttal arguments 
offered.1253 
As discussed above, in its final determination for POR2, the USDOC accepted  
HHI's understanding of the reporting requirements, as well as the reporting of the specific services 
at issue, after  a "review of the sales traces"1254, and concluded that HHI had provided all the 
"necessary" information.1255 Subsequently, in its draft redetermination in the remand proceedings, 
the USDOC rejected the information relating to service -related revenues that was  initially accepted  
by the USDOC in its final determination.  
Having "not accepted" the information supplied by HHI, the USDOC was required, under the 
first sentence of paragraph  6 of Annex  II, to inform HHI "forthwith" of the reasons for such rejection, 
and to provide an opportunity to HHI to furnish further explanations. We note the 
United  States'  argument that HHI "chose to report its data a certain way and misled [the USDOC]  
regarding its reasons for doing so", and, "[b]y adopting this course of action,  [HHI]  never gave [the 
USDOC]  an opportunity to inform [HHI]  of any deficiencies" .1256 The United  States'  argument 
acknowledges that the USDOC did not inform HHI of any deficiencies in the submitted information. 
From the USDOC 's refusal to reopen the record,  it is also clear that no additional information was 
requested by the USDOC or provided by HHI during the remand proceedings.1257  
We disagree with the United  States'  argument that HHI "misled" the USDOC regarding its 
reasons for reporting the service -relate d revenues in "a certain way" and thus HHI "never provided 
[the USDOC]  with an opportunity to inform [HHI]  of any deficiencies".1258 As discussed above, in 
response to a clarification sought by the USDOC in the supplemental questionnaire for POR2, HHI 
stated its understanding that reporting of services  separately from the gross -unit prices was required 
when the services were not perfor med in "the terms of sale".1259 HHI thus clearly set out its 
 
1252 LPT POR2 draft results of redetermination,  (Exhibit  KOR-207 ( public ver sion)), p. 11. See also 
Korea's  first written submission, para.  773. 
1253 Emphasis added.  
1254 LPT POR2 issues and decisions memorandum,  (Exhibit  KOR-110), p.  39. 
1255 LPT POR2 issues and decisions memorandum,  (Exhibit  KOR-110), p.  50. 
1256 United  States'  response to Panel question No.  84, para.  135. 
1257 Korea's  first written submission, para.  836; United  States'  response to Panel question No.  34, 
para. 130. 
1258 United  States'  response to Panel question No.  84, para.  135. 
1259 LPT POR2 supplemental Sections B -C questionnaire response,  (Exhibit  KOR-248 (BCI)), pp.  14-15. 
See para. 7.383  above.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  understanding of its reporting obligations from the outset of the proceedings. In its final 
determination, the USDOC did not find any fault with HHI 's understanding of its reporting 
obligations. Th us, instead of "misleading" the USDOC, HHI disclosed its basis for reporting 
service -related revenues from the outset and the USDOC never took issue with HHI 's position until 
the draft redetermination. Moreover, the United  States'  argument that " [the] USDO C's obligation to 
inform HHI of the nature of any deficiency never arose" because "HHI reported to [the] USDOC on 
multiple occasions that it had no service -related revenues to report"1260 is also circular inasmuch as 
it seeks to justify the USDOC 's failure t o inform to inform HHI of any deficiencies in its reporting 
precisely because of those very deficiencies.  
Paragraph 6 of Annex  II requires that the interested party be informed of the reasons why 
submitted information is not accepted by an investigating a uthority irrespective of the reasons for 
the non -acceptance or the accuracy of the interested party 's reporting. The USDOC rejected the 
information relating to service -related revenues that it had  originally accepted in its final 
determination for POR2. Th e discussion above reveals that the USDOC did not inform HHI "forthwith" 
of the reasons for such rejection.  
We note the United  States'  argument that HHI had the opportunity to comment on the 
USDOC 's draft redetermination , and that the USDOC addressed these  comments before rejecting 
HHI's suggestions in its final redetermination.1261 However, we do not consider that, in the 
circumstances of this case, HHI 's comments on the USDOC 's draft redetermination amount to an 
opportunity to provide further explanations i n the sense of paragraph  6, because , as part of its 
comments,  HHI expressly requested the USDOC to reopen the record and request information with 
respect to service -related revenues during the remand proceedings1262, but the USDOC declined 
HHI's request.1263 Therefore, we conclude that the USDOC did not provide an oppor tunity to HHI for 
furnishing further explanations within a reasonable period, due account being taken of the 
time-limits of the investigation. In the circumstances of this case, this ought to have included an 
opportunity to submit further information in ac cordance with the USDOC 's requirements.  
We therefore  find that the USDOC acted inconsistently with paragraph  6 of Annex  II to the 
Anti-Dumping  Agreement  because – having "not accepted" the information provided by HHI – the 
USDOC failed to inform HHI "fort hwith" of the reasons for its non -acceptance and failed to provide 
an opportunity to HHI for furnishing "further explanations within a reasonable period , due account 
being taken of the time -limits of the investigation" . Given that paragraph  6 of Annex  II serves as a 
precondition for an investigating authority 's proper resort to facts available under Article  6.8 of the 
Anti-Dumping  Agreement , we find that the USDOC also acted inconsistently with that provision in 
resorting to facts available with respect to HHI's reporting of service -related revenues in POR2.1264 
In light of our findings of WTO -inconsistency, we do not consider it necessary to rule upon 
Korea 's claims under paragraphs 3 and 5 of Annex  II to the Anti -Dumping  Agreement  in order to 
provide a positive solution to the dispute before us.1265 
7.3.6.2.4.2   The USDOC 's selection of the replacement facts  
We have already found that the USDOC erred in resorting to facts available with respect to 
HHI's reporting of information concerning service -related revenues. In these circumstances, we do 
not consider that making further findings on Korea 's claims concerning the USDOC 's selection of the 
replacement facts on the basis of the record used for the USDOC 's WTO-inconsistent findings would 
assist in  providing a positive solution to the dispute before us.1266  
 
1260 United  States'  first written submission, para.  218. 
1261 United  States'  response to Panel question No.  34, para.  129. 
1262 LPT POR2 HHI comments on draft redetermination, (Exhibit  KOR-114 (BCI)) , pp. 21-22. 
1263 LPT POR2 final results of redetermination,  (Exhibit  KOR-207 (revised, public version)) , pp. 19 
and 24.  
1264 Panel Reports, China – GOES , paras.  7.384 -7.385; US – Steel Plate , paras.  7.55-7.56; and Mexico – 
Steel Pipes and Tubes , para.  7.190.  
1265 See, e.g. Panel Reports, EC – Salmon (Norway) , para.  7.387; and Morocco – Hot-Rolled Steel 
(Turkey) , paras.  7.105 -7.106.  
1266 See, e.g. Panel Reports, Egypt – Steel Rebar , para.  7.310; and Mexico – Anti-Dumping Measures on 
Rice, para.  7.200. See also Panel Report, China – Broiler Products , para. 7.555.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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The third administrative review (POR3)  
7.3.6.3.1   Introduction  
For the POR3 proceedings, Korea challenges the USDOC 's use of facts available in respect 
of four issues concerning HHI 's reporting of  (a) service -related revenues; (b ) home -market prices; 
(c) accessories; and (d ) certain sales documentation.1267 Korea claims that the USDOC erred in 
resorting to the use of facts available for each of the four issues1268, as well as in its subsequent 
selection of the replacement facts.1269 The United States requests us to reject Korea 's claims, and 
maintains that this is not an instance of "collective failure" where the "USDOC found that Hyundai 
failed with respect to specific issues that, 'on their own' may not warr ant facts available with an 
adverse inference, but 'taken as a whole,' do"; rather, for the United States, the USDOC properly 
resorted to facts available for each specific issue.1270 
We first address Korea 's claims of inconsistency under Article  6.8 and Annex  II of the 
Anti-Dumping  Agreement  concerning the USDOC 's resort to facts available with respect to each of 
the four issues. For each issue, we describe the factual background and summarize the main 
argumen ts of the parties, before examining whether the USDOC erred in resorting to facts available. 
In light of the USDOC 's application of "total facts available with an adverse inference"1271, we then 
examine Korea 's claims pertaining to the USDOC 's selection of t he replacement facts.  
7.3.6.3.2   The USDOC 's resort to facts available  
7.3.6.3.2.1   Service -related revenues  
Factual background  
In its initial questionnaire , the USDOC requested HHI to "report revenue in separate fields 
(e.g., ocean freight revenue, inland freight revenue, oil r evenue, installation, etc. ) and identify the 
related expense(s ) for each revenue".1272 HHI responded that , in view of its understanding of the 
USDOC 's reporting requirements for services in the original investigation, it did not have separate 
revenues for se rvices.1273 The USDOC issued a supplemental questionnaire seeking clarity  as to 
whether HHI "received revenue related to international freight, inland freight, oil, installation, or any 
other expenses" for home market and US sales.1274 HHI responded that it di d not receive any such 
revenues, "[i]n accordance with the [USDOC] 's review and treatment of [HHI] 's sales documentation 
in prior segments of this proceeding".1275 HHI argued that , as its information in this review was 
essentially the same as in the prior segments of this proceeding – and the USDOC had previously 
found that there was no indication of improper reporting – the reporting of its home -market and US 
gross unit prices was appropriate.1276 
 
1267 Korea's  first written submission, paras.  775-797 and 838 -840. 
1268 Korea's  first written submission, para.  775. 
1269 Korea's  first written submission, paras.  767 and 855.  
1270 United States' first written submission, para. 254; response to Panel question No. 37.  
1271 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  4. 
1272 LPT POR3 initial questionnaire,  (Exhibit  KOR-209), p.  B-1. 
1273 LPT POR3 Sections B -C questionnaire response,  (Exhibit  KOR-122 (BCI)), pp.  B-3-B-4. 
HHI explained in detail its reporting methodology:  
Following the [USDOC]'s  analysis in the I&D Memo [accompanying the original final 
determination], [HHI] has reported, since the first administrative review, separate revenue and 
expenses where the customer issues a separate purchase order for services that  are not part of 
the original term of sale. Specifically, in the U.S. sales list, [HHI] has reported the sales amount 
from additional purchase orders in the ADDPOPRU field and the associated additional expenses 
under the separate purchase order in the ADDP OEXPU field. [HHI] did not receive additional 
purchase orders for home market sales during the POR.  
(Ibid.).  
1274 LPT POR3 supplemental Sections B -C questionnaire,  (Exhibit  KOR-124 (BCI)), pp.  6. 
1275 First part of LPT POR3 supplemental Sections A -D questionnai re response,  (Exhibit  KOR-125 (BCI)), 
p. 11. 
1276 First part of  LPT POR3 supplemental Sections A -D questionnaire response,  (Exhibit  KOR-125 (BCI)), 
pp. 11-12. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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In its preliminary decision memorandum, the USDOC did not take issue with HHI 's reporting 
of service -related revenues.1277 Subsequently, the USDOC issued a supplemental questionnaire, 
requesting HHI to "provide complete sales and expenses docu mentation (including all sales and 
expenses related documentation generated in the sales process ) for all U.S. SEQUs".1278 It further 
asked HHI to revise its US sales database to report in separate fields all expenses and revenues for 
separately -negotiated s ervices and non -subject merchandise for the sales identified as 
SEQUs  [[***]].1279 In the event that HHI considered that there were no such additional expenses or 
revenues, the USDOC requested HHI to comment on the corresponding assertions of the 
petitioner.1280 HHI responded to the USDOC 's request and provided "worksheet listing on a category 
basis the values listed anywhere in the sales documentation for the breakdowns of the price of the 
LPTs and the corresponding expenses", while insisting that there were n o "separate" revenues for 
services.1281 
In its final determination issues and decision memorandum, the USDOC noted that:  
Although we requested that [HHI]  report separately service -related revenues 
(e.g., freight, installation, and supervision ) from the associated expenses in prior 
segments of this proceeding, we did not require [HHI]  to do so in the previous segments 
because [HHI]  stated that such services were required under the terms of sale and that 
these revenues were not separately invoiced  to the customers. However, record 
evidence in the prior review shows that [HHI] 's U.S. price could be inflated by the 
inclusion of service -related revenues, thereby affecting the [USDOC] 's ability to 
calculate an accurate antidumping margin. Given these c oncerns, at the onset of this 
instant review, we requested that [HHI]  separately report such revenues and related 
expenses so that, per our practice, we could cap such revenues by the related 
expenses.1282  
The USDOC further observed that in the second part of HHI 's response to the supplemental 
questionnaire, certain documents identified separate service line items with the corresponding 
prices/revenue s listed were higher than the expenses reported for this sale.1283 According to the 
USDOC, "[t]his finding  affirmed [its] concerns regarding the methodology [HHI] used to report gross 
unit price".1284 In addition, the USDOC noted that the revised US sales database submitted by HHI 
in its supplemental response had purchase orders or invoices for many US sales con taining separate 
line items for services, thus confirm ing that "while revenues from such services may not have been 
separately  invoiced to the customers, [HHI] and its customers separately assigned prices for the 
related services and identified these amoun ts as separate line items on invoices, separate from the 
price of the subject merchandise".1285 
 
1277 LPT POR3 decision memorandum for preliminary results,  (Exhibits  KOR-127 (BCI), KOR -135 
(public  version)).  
1278 LPT POR3 HHI third supplemental questionnaire, (Exhibit  KOR-128 (BCI)), p.  5. (emphasis original)  
1279 LPT POR3 HHI third supplemental questionnaire, (Exhibit  KOR-128 (BCI)), p.  6. 
1280 LPT POR3 HHI third supplemental questionnaire, (Exhibit  KOR-128 (B CI)), p.  6. 
1281 LPT POR3 HHI third supplemental questions 13 and 17 response, (Exhibit  KOR-119 (BCI)), p.  23 
and exhibit  3S-46. 
1282 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  18. The USDOC stated that it 
had requested three times the separa te reporting of these revenues, that is in its 3 December 2015 initial 
questionnaire, in its 27 July 2016 supplemental questionnaire, and in its 7 October 2016 supplemental 
questionnaire. (Ibid. pp.  18-20 and 24).  
1283 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  20 (referring to Second part of 
LPT POR3 supplemental Sections A -D questionnaire response,  (Exhibit  KOR-126 (BCI))).  
1284 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  20. 
1285 LPT POR3 issues and decision memorandum,  (Exhibit KOR-121), p.  21 (emphasis original). In detail, 
the USDOC explained:   
Although these services are required under the terms of sale and are invoiced on a lump -sum 
basis, as [HHI] argued, we find that [HHI]'s  sales documentation specifically indicates t hat these 
sales-related services could be negotiable, apart from subject merchandise, since each service is 
shown/listed with the corresponding amount in purchase orders and/or invoices. In other words, 
if customers do not like [HHI]'s  price for a certain service, they can procure/arrange such service 
on their own without using [HHI]'s  service. That is, we cannot conclude that such service is 
non-negotiable and that customers cannot opt out of the service prior to accepting the offer just 
because a specific  service is included in the selling price under the terms of sale. Similarly, we 
cannot conclude, as [HHI] suggests, that such service -related revenue should always be part of 
 WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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Finally, the USDOC stated that the worksheet submitted by HHI was incomplete and cast 
serious doubts on the reliability of such information.1286 According to the US DOC, it would have had 
the time to verify the issues raised, had HHI submitted this information earlier on in the review, but 
"[w]hat key information [HHI]  finally provided came in very late in the process, thereby negating 
[its] ability to [check] … that the data provided are accurate and reliable, and to develop deficiency 
questionnaires".1287  
Main arguments of the parties  
Korea claims that the USDOC resorted to facts available in violation of Article  6.8 of the 
Anti-Dumping  Agreement  as HHI did not "refu se[] access to", or otherwise fail to provide, 
"necessary" information, nor did it "significantly impede []" the proceedings .1288 Korea takes issue 
with the USDOC 's determination in the final results of POR3, which, in its view, "directly contradicts" 
the USD OC's position in the final results of POR2 and the preliminary results of POR3 ; that HHI did 
not need to separately report revenues for services that were performed under the terms of sale of 
LPTs.1289 According to Korea, the POR3 administrative review marks  the first instance when the 
USDOC requested HHI to report such expenses and revenues relating to "separately -negotiated 
services and non -subject merchandise", that is, "based on whether such revenues were separately 
listed on a sales document".1290 Korea de scribes this shift in "accepted definition" as a "significant 
extra burden" on HHI, and states that even so, HHI submitted data in accordance with the 
"redefined" service -related revenue s in a timely manner.1291  
Korea also claims that the USDOC acted incons istently with paragraphs 3 and  5 of Annex  II 
to the Anti -Dumping  Agreement  by rejecting verifiable and substantiated information that HHI  
submitted  in a timely fashion.1292 Korea contends that the USDOC did not explain how many sales 
were affected by the alleged error in the submitted worksheet  for determining whether the entirety 
of the information was tainted or un usable.1293 Nor was the USDOC justified in rejecting this dat a on 
the basis of untimeliness, given that it had imposed unreasonable and untimely demands, and given 
that it refused to take any further action even though the information was submitted over 
four months before the issuance of the final results.1294 Accordi ng to Korea, the 
United  States'  statement that HHI provided the information requested "nearly a year after" the 
USDOC had requested it is "entirely disingenuous", given that the USDOC had accepted HHI 's initial 
reporting in the preliminary determination wi thout expressing any concerns.1295 Korea asserts that 
HHI cooperated "to the best of its ability" by submitting the requested data and that the USDOC was 
not justified to reject it based on the allegation that it was imperfect.1296  
According to the United  States, "necessary" information was missing from the record,  
despite multiple requests by the USDOC which served to notify HHI of the USDOC 's reporting 
requirements.1297 The United  States  submits that HHI had multiple opportunities to submit the 
requested data,  but it chose to "ignore or defy" the USDOC 's definitions and instructions, resulting 
in inaccurate and flawed reporting.1298 The United  States  also asserts that, because 
HHI's information did not meet the criteria under paragraph  3 of Annex  II, it is not af forded the 
 
the gross unit price just because a service is not arranged separately. Therefor e, given the record 
evidence, we find that service -related revenues for the sale of subject merchandise should not be 
considered as a component of the gross unit price.  
(Ibid.).  
1286 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  21. 
1287 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  22. 
1288 Korea's  first written submission, paras.  775-776. 
1289 Korea's  first written submission, paras.  697-698. 
1290 Korea's  first written submission, para.  702. (quoting LPT POR3 HHI third supplemental 
questionnaire, (Exhibit  KOR-128 (BCI)), p.  6). 
1291 Korea's  first written submission, paras.  776-777 (referring to LPT POR3 HHI third supplemental 
questions 13 and 17 respo nse, (Exhibit  KOR-119 (BCI)), p.  23 and exhibit  3S-46). 
1292 Korea's  first written submission, para.  838. 
1293 Korea's  second written submission, para.  305. 
1294 Korea's  first written submission, para.  779. 
1295 Korea's  second written submission, para.  303. 
1296 Korea's  first written submission, para.  778. 
1297 United  States'  first written submission, para.  253. 
1298 United  States'  first written submission, para.  255. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 136 - 
 
  protections of paragraph  5, and in any event, HHI did not act "to the best of its ability" in responding 
to the USDOC 's requests for information.1299 
Evaluation by the Panel  
Korea claims that the USDOC acted inconsistently with Article  6.8 and par agraphs 3 and 5 
of Annex  II of the Anti -Dumping  Agreement  in resorting to the use of facts available in respect of 
HHI's reporting of service -related revenues in POR3.  
We have discussed a similar  issue concerning the reporting of service -related revenues as 
part of our analysis for POR2 above. The essential facts relating to the alleged "change" in the 
USDOC 's methodology or definition remain the same for both the POR3 final determination and the 
POR2 redetermination. One crucial difference, however, is that in POR3, the USDOC appears to have 
provided HHI with an opportunity to report service -related revenues when deciding that it was 
necessary to apply its "capping methodology ". Accordingly, Korea  confines its claims of inconsistency 
to paragraphs 3 and 5 of Annex  II, and to Article  6.8. As with the POR2 remand proceedings, we do 
not understand Korea to be taking issue with the USDOC 's ability to apply its "capping 
methodology".1300 Rather, the quest ion before us is whether the USDOC acted in a WTO -consistent 
manner in rejecting the information submitted by HHI.  
We recall that, i n its preliminary decision memorandum dated 26 August 2016, the USDOC 
did not take issue with HHI 's reporting of service -related revenues.1301 Thus, as of the preliminary 
determination, there was no reason for HHI to suspect that its reporting and the basis thereof were 
somehow deficient for purposes of the USDOC 's determination. Following its preliminary 
determination , the USDOC issued a third supplemental questionnaire on 7 October 2016, requesting 
HHI to "provide complete sales and expenses documentation (including all sales and expenses 
related documentation generated in the sales process ) for all U.S. SEQUs".1302 The USDOC noted 
the petitioner 's assertion that "HHI incurred expenses and obtained revenues for 
separately -negotiated services and non -subject merchandise for the sales identified as 
SEQUs  [[***]]", and on this basis asked HHI to "revise [its] U.S. sales database to report all such 
expenses and revenues for these sales in separate fields".1303 In the event that HHI considered that 
there were no such additional expenses or revenues, the USDOC requested HHI to comment on the 
corresponding assertions of t he petitioner.1304  
Given that the USDOC did not take issue with HHI 's reporting of service -related revenues in 
its preliminary determination, the third supplemental questionnaire is the first instance when HHI 
was notified that the USDOC was not satisfied w ith its reporting of service -related revenues. HHI 
responded to the USDOC 's third supplemental questionnaire on 10 November 2016 – within the 
deadline established by the USDOC – and provided a "worksheet listing on a category basis the 
values listed anywhe re in the sales documentation for the breakdowns of the price of the LPTs and 
the corresponding expenses", stressing however  that there were no "separate" revenues for 
services.1305 
In its final determination, the USDOC rejected this information and found th at the " worksheet 
provided is incomplete and casts serious doubt on the reliability of such information" .1306 By way of 
reasoning, the USDOC referred to an example offered by the petitioner:  
For example, as Petitioner noted, the worksheet appears to be missi ng information for 
multiple U.S. sales ( i.e., it is missing the related expenses for its claimed revenues).1307  
 
1299 United  States'  first written submission, para.  262. 
1300 Korea's  response to Panel question No.  35, pp. 31 -32. 
1301 LPT POR3 decision memorandum for preliminary results,  (Exhibits KOR -127 (BCI), KOR -135 
(public  version)).  
1302 LPT POR3 HHI third supplemental questionnaire, (Exhibit  KOR-128 (BCI)), p.  5. (emphasis original)  
1303 LPT POR3 HHI third supplemental questionnaire, (Exhibit  KOR-128 (BCI)), p.  6. 
1304 LPT POR3 HHI third supplemental questionnaire, (Exhibit  KOR-128 (BCI)), p.  6. 
1305 LPT POR3 HHI third supplemental questions 13 and 17 response, (Exhibit  KOR-119 (BCI)), p.  23 
and exhibit  3S-46. 
1306 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  21. 
1307 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  21. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  The USDOC did not provide any further explanation concerning the alleged deficiencies in 
HHI's worksheet. The USDOC acknowledged that HHI in its rebuttal brief "attempted to explain the 
reason for the missing information" by stating that : "(1) such items relate to the manufacture of the 
transformer and the costs are, therefore, included in the reported cost of production; and (2 ) there 
are no separ ate sales expenses for these production costs" .1308 The USDOC did not examine these 
explanations, but instead provided the following explanation:  
[W]e cannot examine the validity of [HHI] 's reporting at this late stage of the review. 
What key information [HHI]  finally provided came in very late in the process, thereby 
negating our ability to satisfy ourselves that the data provided are accurate and reliable, 
and to develop deficiency question naires, as needed.1309 
Paragraph 3 of Annex  II to the Anti -Dumping  Agreement  requires an investigating authority 
to "take into account" all information that is "verifiable", "appropriately submitted so that it can be 
used in the investigation without undue d ifficulties", and "supplied in a timely fashion". Information 
that satisfies these criteria cannot, therefore, be rejected by investigating authorities.1310 
We note that the reason provided by the USDOC for its finding that the "worksheet provided 
is incompl ete" was that, as the "[p]etitioner noted, the worksheet appears to be missing information 
for multiple U .S. sales".1311 The petitioner 's case brief reveals that the "multiple U.S. sales" pertain 
to [[***]] SEQUs.1312 The USDOC acknowledges that HHI "attempted  to explain the reason for the 
missing information" in its rebuttal brief. However, the USDOC stated that it could not "examine the 
validity of [HHI] 's reporting at this late stage of the review" as the "key information [HHI]  finally 
provided came in very late in the process".1313 Thus, as we see it, the main reason provided by the 
USDOC for disregarding the worksheet provided by HHI and its explanations relating thereto 
concerned the timeliness of HHI 's responses. We must therefore determine whether the information 
provided by HHI  was supplied within a "timely fashion" , within the meaning of paragraph  3 of 
Annex  II. 
We note that HHI provided the worksheet at issue in response to the USDOC 's third 
supplemental questionnaire  on 10 November 2016, thus  within the deadlines established by the 
USDOC for that purpose.1314 The issue of timeliness of HHI 's submission therefore does not relate to 
whether HHI responded within the prescribed time -limit. Rather, the USDOC 's concern relates to the 
"late stage of the review process" when the informa tion was submitted.1315 According to the USDOC, 
because the worksheet "came in very late in the process" it was unable to check the accuracy and 
reliability of the information, and develop deficiency questionnaires, as needed.1316 Our 
understanding is confirme d by the USDOC 's observation that HHI should have separately reported 
service -related revenues and related expenses "early on ( i.e., in [HHI's] January 27, 2016, 
Sections  B and C Questionnaire Response or even in [HHI's] August 10, 2016, Supplemental 
Quest ionnaire Response)".1317 
Although the USDOC requested information relating to service -related revenues and 
expenses as part of its initial and supplemental questionnaires, it did not take issue with 
HHI's responses in its preliminary determination dated 26 A ugust 2016.1318 It was only as part of its 
third supplemental questionnaire, issued on 7 October 2016, that the USDOC noted the 
petitioner 's concerns and sought revised information from HHI. Thus, irrespective of the scope of its 
initial queries, the USDOC accepted the i nformation originally reported by HHI , until 7 October 2016 
– when the USDOC issued its third supplemental questionnaire seeking a revised database. As HHI 
could not have been aware of any deficiencies in its responses before the third supplemental 
 
1308 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), pp.  21-22 (referring to LPT POR3 
HHI rebuttal brief, (Exhibit KOR -270 (BCI)) , p. 17). 
1309 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  22. 
1310 See para. 7.138  above.  
1311 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  21. 
1312 LPT POR3 petitioner's  case brief,  (Exhibit  KOR-129 (BCI)), pp.  21-22. 
1313 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  22. 
1314 LPT POR3 HHI supplemental questionnaire response , (Exhibit  KOR-136 (BCI)), p.  15. 
1315 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  22. 
1316 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  22. 
1317 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  22. 
1318 LPT POR3 decision memorandum for preliminary results,  (Exhibits KOR -127 (BCI), KOR -135 
(public  version)).  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 138 - 
 
  questionnaire, we are not persuaded by the United  States'  argument that HHI provided the 
information "nearly a year after [the] USDOC first requested that HHI report separately 
service -related revenues and associated expenses".1319  
As the USDOC did not rais e any concerns with respect to HHI 's initial responses, we do not 
consider that these responses constituted opportunities for HHI to appropriately report 
service -related revenues  earlier in the review process. We therefore disagree with the United  States  
that the USDOC, by requesting such information "multiple times" from HHI, "ensured that HHI was 
aware of its reporting requirements".1320 Furthermore, HHI submitted the revised worksheet on 
10 November 2016, which, as Korea points out, was over four months be fore the final determination 
dated 13 March 2017.1321 In these circumstances, we are not convinced that the worksheet was 
submitted so late in the process that the USDOC was unable to assess its accuracy and reliability.1322 
Indeed, if the USDOC did not intend  to assess the accuracy and reliability of the data submitted in 
response to its third supplemental questionnaire, it is unclear for what purpose the USDOC issued 
that questionnaire. For purposes of paragraph  3, therefore, we find that the worksheet submit ted 
by HHI on 10 November 2016 was "supplied in a timely fashion".  
We also note the USDOC 's finding that the " worksheet provided is incomplete and casts 
serious doubt on the reliability of such information" .1323 One reason offered by the USDOC for this 
finding is that , "as Petitioner noted, the worksheet appears to be missing information for multiple 
U.S. sales ( i.e., it is missing the related expenses for its claimed revenues)" .1324 We note however 
that HHI in its rebuttal brief "attempted to explain the reason for the missing information".1325 
The USDOC did not examine these explanations, because " [w]hat key information [HHI]  finally 
provided came in very late in the process, thereby negating [its] ability [to check]  that the data 
provided are accurate and reliable, and to develop deficiency questionnaires, as needed" .1326  
Thus, any finding by the USDOC concerning the unreliability or incompleteness of the 
information – based on the pet itioner 's observations – is premised on its finding that the worksheet 
was submitted at a late stage of the proceedings , and on its decision to not examine the explanations 
provided by HHI for that reason. We have, however, found that the worksheet submitt ed by HHI 
was provided in a "timely fashion" for purposes of paragraph  3. The USDOC does not provide any 
other reasons as to why the information was not "verifiable" or could not be taken into account 
"without undue difficulties". Korea asserts that the in formation submitted was unquestionably 
verifiable.1327 For the reasons set out above, we are not convinced by the United  States'  argument 
that the information submitted was not verifiable in light of the difficulties faced by the USDOC in 
obtaining the infor mation despite multiple requests.1328 Insofar as the USDOC considered any "undue 
difficulties" to be related to the incomplete nature of the information, we find that this issue is also 
grounded, ultimately, on the USDOC 's erroneous finding of untimeliness o f HHI's responses.  
For these reasons, we find that the USDOC acted inconsistently with the first sentence  of 
paragraph  3 of Annex  II to the Anti -Dumping  Agreement  by not "tak[ing] into account" the 
information concerning service -related revenues that was submitted by HHI in accordance with that 
provision. Given that paragraph  3 of Annex  II serves as a precondition for an investigating 
authority 's proper resort to facts available under Article  6.8 of the Anti -Dumping  Agreement1329, we 
find that the USDOC also acted inconsistently with that provision in resorting to facts available. 
In light of our findings of WTO -inconsistency, we do not consider it necessary to rule upon 
 
1319 United  States'  first written submission, paras.  237-238.  
1320 United  States'  first written submission, para.  253. 
1321 Korea's  first written submission, para.  779. 
1322 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  22. 
1323 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  21. 
1324 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  21. 
1325 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  21 (re ferring to LPT POR3 HHI 
rebuttal brief, (Exhibit KOR -270 (BCI)) , p. 17). 
1326 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  22. 
1327 Korea's  second written submission, para.  301. 
1328 United  States'  first written submission, para.  252. 
1329 Panel Reports, China – GOES , para.  7.385; US – Steel Plate , paras.  7.55-7.56 and 7.79 . WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 139 - 
 
  Korea 's claims under paragraph  5 of Annex  II to the Anti -Dumpin g Agreement  in order to provide a 
positive solution to the dispute before us.1330  
7.3.6.3.2.2   Alleged u nderstatement of home -market prices  
Factual background  
In its initial questionnaire, the USDOC requested HHI to "separately report the price and 
cost for 'spare parts ' and 'accessories ' to ensure that product matches are based on accurate 
physical characteristics of the LPTs".1331 In response, HHI submitted documentation identifying 
[[***]] as "non -subject merchandise".1332 Citing the USDOC 's definition of subject merchand ise and 
the issues and decisions memorandum from the original investigation, HHI reported separately the 
price and cost for spare parts, but not for "[t]ransformer parts that [are] physically attached to an 
LPT [and therefore] are within the definition of the scope of subject merchandise".1333 
In its supplemental questionnaire, the USDOC requested complete sales documentation for 
home market sequence numbers ( SEQHs ) [[***]] and [[***]] relating to home market sale s.1334 
In its additional supplemental questionnaire , the USDOC further asked HHI to provide for the same 
SEQHs "any supporting documentation of [the] sales negotiation process ( i.e., internal documents, 
e-mails, etc. ) and all reported expenses ( i.e., freight request from HHI to th e freight provider, freight 
invoice from the freight provider)".1335 HHI submitted information in response to both these 
requests.1336 
Commenting on HHI 's questionnaire responses1337, the petitioner stated that "an 
examination of the limited documents submitted by [HHI]  confirms that [HHI]  has employed a 
methodology that understated the reported gross unit price (GRSUPRH ) for home market sales" 
(namely SEQHs [[***]]).1338 The petitioner  explained that HHI "wrongly identified integral parts of 
subject transformers" and , as a result , "[t]hose parts were not included in the reported gross unit 
price, which was therefore understated".1339 Specifically, the petitioner argued that the identification 
and reporting of these parts was erroneous , as documents submitted in HHI 's 27 October 201 6 
additional supplemental questionnaire response treated these parts as integral parts of LPTs, and 
thus as "subject merchandise".1340 Furthermore, according to the petitioner, " [HHI]  appear[ed] to 
have employed the same methodology across all home market sale s reported, resulting in a portion 
of the gross unit price being incorrectly excluded from the price reported to the [USDOC] ".1341 Thus, 
in the petitioner 's view, by failing to report the full value of the subject merchandise, HHI had 
understated the home ma rket gross unit price, and, in turn, the dumping margin.1342 
HHI responded that the petitioner raised its objection three months after the submission of 
the concerned document , and argued  that: 
At this stage of this review, [HHI]  is not permitted to submit r ebuttal information to 
respond to [the petitioner's ] argument and is limited to documents on record. With this 
limitation, the record is ambiguous and does not allow a definitive conclusion regarding 
whether the items in question are properly included in t he gross unit price. In light of 
 
1330 See, e.g. Panel Reports, EC – Salmon (Norway) , para.  7.387; and Morocco – Hot-Rolled Steel 
(Turkey) , paras.  7.105-7.106.  
1331 LPT POR3 initial questionnaire,  (Exhibit  KOR-209), p.  D-1. 
1332 Second part of LPT POR3 supplemental Sections A -D questionnaire response,  (Exhibit  KOR-126 
(BCI)), attachment 2S -17.   
1333 LPT POR3 Section D questionnaire response, (Exhibit  KOR-134 (BC I)), pp.  D-2-D-3. 
1334 Second part of LPT POR3 supplemental Sections A -D questionnaire response,  (Exhibit  KOR-126 
(BCI)), attachment 2S -17. 
1335 LPT POR3 HHI third supplemental questionnaire, (Exhibit  KOR-128 (BCI)), p.  5. 
1336 LPT POR3 HHI supplemental questionnai re response , (Exhibit  KOR-136 (BCI)), p.  8 and 
attachment  3S-7. 
1337 In particular, the petitioner's  comments addressed the data submitted by HHI in response to the 
USDOC's  questionnaires of 27 July 2016 and 7 October 2016.  
1338 LPT POR3 petitioner's  comments,  (Exhibit  KOR-252 (BCI)), p.  10. 
1339 LPT POR3 petitioner's  comments,  (Exhibit  KOR-252 (BCI)), p.  10. 
1340 LPT POR3 petitioner's  comments,  (Exhibit  KOR-252 (BCI)), pp.  10-12. 
1341 LPT POR3 petitioner's  comments,  (Exhibit  KOR-252 (BCI)), p.  12. 
1342 LPT POR3 petitioner's  comments,  (Exhibit  KOR-252 (BCI)), pp.  12-13. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 140 - 
 
  this ambiguity, [HHI]  provides in Exhibit 2 a revised price calculation worksheet, which 
treats the items in [ sic] as transformer components.1343 
In the final determination, the USDOC found that HHI had incorrectly reported i ts home 
market price despite its knowledge that "(1 ) parts that are physically attached to, imported with, or 
invoiced with active parts of a LPT; or (2 ) parts that are required to assemble an incomplete LPT, 
are also subject merchandise/foreign like produ ct, and that they should be included in its reported 
gross unit price".1344 According to the USDOC, HHI failed to "include properly a particular part in its 
reported home market gross unit prices" until this issue was identified by the USDOC, despite having 
three opportunities to do so.1345 The USDOC further noted that while HHI had failed to include this 
specific part in its home market sale s, it had included it in the gross unit prices for its US sales, 
which rendered the US price and the home -market price in comparable.1346 The USDOC found that 
"the vast majority of the reported gross unit prices provided by [HHI] , pursuant to the 
[USDOC 's] request for full documentation for a limited number of sample sales … display the 
understatement of such reported prices".1347 Thus, the USDOC found that HHI had impeded the 
review proceedings and its reported home market prices were, in their entirety, unreliable.1348 
Main arguments of the parties  
Korea claims that the USDOC resorted to facts available in violation of Article 6.8 of the 
Anti-Dumping  Agreement  as HHI did not "refuse [] access to", or otherwise fail to  provide, 
"necessary" information, nor did it "significantly impede []" the proceedings .1349 Korea explains that, 
in response to the USDOC 's request for complete sales documentation for certain home market sales 
(SEQHs  [[***]] and [[***]]), HHI inadvertently identified certain [[***]] as non -subject 
merchandise in one of the contracts submitted.1350 This error concerned a single contract ( [[***]]), 
which was submitte d in the sales documentation for SEQH [[***]] and covered multiple 
transformers, under SEQHs  [[***]].1351 Korea argues that the misreported information could not in 
good faith  be considered  as "necessary", as it concerned a small amount of data about an isolated 
home market sale  consisting of four LPTs.1352 According to Korea, "[t]his isolated information could 
not objectively be viewed as casting doubt on all of the sales and related data  reported in the 
home -market sales database".1353 
Furthermore, Korea argues that there was no need to apply facts available in order to 
overcome the absence of information , as HHI 's inadvertent error was immediately corrected and full 
information was provided that allowed the USDO C to make its determination.1354 Specifically, Korea 
refers to the worksheet submitted by HHI supporting the gross unit price as originally calculated 
(i.e. without the part that was identified as non -subject merchandise), as well as a revised price 
calculat ion worksheet (i.e. including the revenue for that part in the gross unit price).1355 In addition, 
there was sufficient time for the USDOC to take into account HHI 's revisions as they were provided 
more than two months before the final results,  and thus with in a reasonable time.1356 Korea notes 
that the USDOC, instead of treating this deficiency as an isolated issue, "added this to the other 
issues to construct a rationale for disregarding all of HHI 's data and applying total AFA".1357 
Korea also claims that the USDOC acted inconsistently with paragraphs 3 and 5 of Annex  II 
to the Anti -Dumping  Agreement  by rejecting verifiable and substantiated information that was 
submitted by HHI in a timely fashion.1358 Korea contends that HHI had provided verifiable 
 
1343 LPT POR3 HHI case brief,  (Exhibit  KOR-130 (BCI)), p.  21. (emphasis omitted)  
1344 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), pp.  23-24. 
1345 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  24. 
1346 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  25. 
1347 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), pp.  25-26. 
1348 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  26. 
1349 Korea 's first written submission, paras.  780 and 783.  
1350 Korea's  first written submission, paras.  705-707. 
1351 Korea's  response to Panel question No.  86, para.  104. 
1352 Korea's  first written submission, para.  780. 
1353 Korea's  response to Panel question No.  88, para.  107. (emphasis original)  
1354 Korea's  first written submission, para.  781. 
1355 Korea's  first written submission, para.  707. 
1356 Korea's  second written submission, para.  309. 
1357 Korea's  second written submission, para.  308. 
1358 Korea's  first written submission, para.  838. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 141 - 
 
  informat ion regarding the reporting of a single part, which enabled the USDOC to establish the 
normal value of the four LPTs in the one transaction at issue, but the USDOC chose to disregard 
such information.1359 According to Korea, even if the USDOC considered this  information as not being 
ideal, this was not a sufficient reason to disregard it, and the appropriate response would have been 
to issue an additional supplemental questionnaire to HHI.1360 
The United  States  responds that HHI failed to provide all the requir ed information and to act 
to the best of its ability.1361 According to the United  States , HHI 's home -market database failed its 
"reliability check" as [[***]] out of the [[***]] sales for which the USDOC requested support ing 
documentation in order to check the accuracy of the whole database demonstrated that HHI had 
engaged in improper reporting of data.1362 The United  States  contends that the USDOC did not have  
sufficient time to verify the accuracy of HHI 's subsequent correction.1363 Finally, the United  States  
notes that HHI corrected the home -market gross unit prices for the few sales for which the USDOC 
had requested support ing documentation, however, it did not "restore the integ rity of the 
unexamined home market sales".1364 
Evaluation by the Panel  
Korea claims that the USDOC acted inconsistently with Article  6.8 and paragraphs 3 and 5 
of Annex  II of the Anti -Dumping  Agreement  in resorting to the use of facts available in respect of  
HHI's reporting of an LPT part as non -subject merchandise.  
At the outset, we note that Korea does not dispute that the part at issue was initially 
misreported by HHI. Nor did HHI dispute the petitioner 's claim of misreporting before the USDOC.1365 
There is also no disagreement between the parties on the appropriate reporting requirements in 
light of the USDOC 's definition of "subject merchandise".1366 Rather, Korea characterizes the 
misreporting of [[***]] as non -subject merchandise as an "inadvertent error" b y HHI.1367  
We recall that the USDOC took issue with the improper reporting of a particular LPT part in 
the gross unit prices of certain home market sale s. The USDOC referred to the petitioner 's claim 
concerning certain documentation submitted for SEQH  [[***]] in HHI 's 27 October 2016 
questionnaire response. According to the petitioner, this documentation demonstrated the 
understatement of the reported gross unit prices (field GRSUPRH ) for specific home market sales 
(SEQHs  [[***]]), due to the mischaracter ization of certain [[***]] as non -subject merchandise.1368 
In response, HHI submitted with its case brief a revised worksheet which treated the LPT part at 
issue as subject merchandise, thus including it in the gross unit price.1369 In the final determination,  
the USDOC found that HHI had incorrectly reported the gross unit prices for these home market 
sales, even though it was fully aware of what constituted "subject merchandise".1370 The USDOC 
found:  
 
1359 Korea's  first written submission, para.  838. 
1360 Korea's  first written submission, paras.  838-839. 
1361 United  States'  first written submission, para.  260. 
1362 United  States'  response to Panel question No.  88, para.  148. 
1363 United  States'  response to Panel question No.  88, para. 150.  
1364 United  States'  response to Panel question No.  88, para.  149. 
1365 See also LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  25. 
1366 The agreed definition of the "subject merchandise" is found in Appendix III of the US DOC's  initial 
questionnaire:  
The scope of this order covers large liquid dielectric power transformers (LPTs)  having a top 
power handling capacity greater than or equal to 60,000 kilovolt amperes (60 megavolt 
amperes), whether assembled or unassembled, com plete or incomplete.  
Incomplete LPTs are subassemblies consisting of the active part and any other parts attached to, 
imported with or invoiced with the active parts of LPTs. The "active part" of the transformer 
consists of one or more of the following wh en attached to or otherwise assembled with one 
another:  the steel core or shell, the windings, electrical insulation between the windings, the 
mechanical frame for an LPT.  
(LPT POR3 initial questionnaire,  (Exhibit  KOR-209), appendix III)  
1367 Korea's  first written submission, paras.  705-707. 
1368 LPT POR3 petitioner's  comments,  (Exhibit  KOR-252 (BCI)), p.  10. 
1369 LPT POR3 HHI case brief,  (Exhibit  KOR-130 (BCI)), p.  21. 
1370 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), pp.  23-24. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  In addition, even though [HHI]  provided the "revised" gross u nit prices for such sales 
in its case brief, which show increased gross unit prices for those sales identified by the 
[USDOC]  in its review of [HHI] 's October 27, 2016, Supplemental Questionnaire 
Response, we have no time to confirm or verify the validity of these revisions. For 
example, we cannot confirm whether other parts, which [HHI]  listed as "non -subject 
merchandise" (i.e. non -foreign like product ) in the same document referred to above, 
are, in fact, non -foreign like product . To confirm the accuracy of [HHI] 's reporting as a 
whole, we  requested full sales and expenses documentation for a very limited number 
of sample home market sales. The fact that a certain document exhibits a consistent 
pattern of understating the reported home market prices for the requested sale and 
other covered sales, for which we did not request full documentation, calls into question 
the reliability  of [HHI] 's reported home market prices.  
… 
To verify the accuracy of [HHI] 's reporting , we requested full documentation for certain 
home market sales, only to determ ine, at such a late stage in the review, that there is 
a significant issue which could be related to [HHI] 's entire reporting of home market 
gross unit prices .1371 
We note that although HHI 's misreporting affected multiple ( [[***]]) SEQHs, this was due 
to a single error, namely, the consistent characterization of a single part (i.e . [[***]], within the 
same contract as non -subject merchandise. The USDOC acknowledged that only "a certain 
document" exhibited this error.1372 Thus, the record evidence indicates tha t the misreporting 
concerned a single part in a single document – out of multiple documents that were submitted in 
response to the USDOC 's complete documentation request – for one of the two sampled sales.  
Moreover, while the USDOC acknowledged that HHI p rovided the revised gross unit prices 
for the misreported sales as part of its case brief – which showed "increased gross unit prices for 
those sales identified by the [USDOC]  in its review of [HHI] 's October 27, 2016 Supplemental 
Questionnaire Response" – the USDOC stated that it had "no time to confirm or verify the validity 
of these revisions".1373 As an "example", the USDOC stated that it could not "confirm whether other 
parts, which [HHI] listed as 'non -subject merchandise ' (i.e., non-foreign like product ) in the same 
document referred to above, are, in fact, non -foreign like product".1374 Observing that HHI 's "U.S. 
sales database indicates that [it] included such parts in the reported gross unit prices for the U.S. 
sales", the USDOC stated that "[i]n cluding such parts  in U.S. price, but not in home market price, is 
a serious issue because it renders U.S. price and normal value incomparable" .1375  
We have no reason to doubt the "seriousness" of the issue flagged by the USDOC. 
Nonetheless, we note that th e USDOC 's statements appear to suggest that the discrepancies at issue 
related to multiple "parts" and represented a "systematic" understatement of home market sales. 
However, the USDOC found that HHI misreported only a single "part" as a non -foreign like 
product.1376 Thus, the USDOC 's finding of discrepancies between the US sales and home market 
sales concerned a single part that was misreported in one document. Insofar as this discrepancy 
was concerned, the USDOC also appears to have considered the revised gross unit prices for the 
misreported home market sales that HHI provided as part of its case  brief.1377 In any event, although 
the inclusion of the single part in the US price, but not in the home market price, may well render 
the US price and the normal va lue "incomparable", the "seriousness" of this issue does not, without 
more, establish a "pattern" of systematic misreporting by HHI for all of its home market sale s. While 
we acknowledge the USDOC 's explanation that the documents requested for the sample s ales were 
aimed at checking the accuracy of the home market sale s as a whole, we note that the USDOC 
provided no explanation as to how the misreporting of one LPT part in relation to one of the 
 
1371 LPT P OR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  25. (fn omitted; 
emphasis  added)  
1372 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  25. 
1373 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  25. 
1374 LPT POR3 issues and decis ion memorandum,  (Exhibit  KOR-121), p.  25. (emphasis added)  
1375 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  25. (emphasis added)  
1376 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  25 (finding that the "record 
evidence demonstr ates that the excluded part is required to assemble a complete LPT. As a result, this part 
should have been treated as foreign like product" (fn omitted)). (Ibid.).  
1377 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  25. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  two sampled SEQHs undermined the reliability of the whole data base.1378 Even though this 
misreporting may have affected multiple ( [[***]]) SEQHs, this was due to the mischaracterization 
of this one part – the [[***]] – within the same contract  as non -subject merchandise. In our view,  
such misreporting of a single part in one document cannot amount to a "pattern" of misreporting.  
In such a situation, an objective and unbiased investigating authority would not have found 
an existence of a "pattern" of misreporting suggesting that HHI 's "reported home market prices in 
their entirety are unreliable".1379 We agree with Korea 's argument that , in the circumstances of this 
case, "[t]his isolated information could not objectively be viewed as casting doubt on all of the sales 
and related data  reported in the home -market sales database".1380 We note that the petitioner 
asserted – without, however, providing any further explanation – that HHI had "employed the same 
methodology across all home  market sales reported".1381 Likewise, the USDOC – despite ref erring 
to discrepancies relating to multiple "parts" – made no attempts to ascertain whether HHI had 
misreported other parts as non -foreign like products. Indeed, the USDOC found only that 
HHI's misreporting " could be  related to [its] entire reporting of h ome market gross unit prices".1382 
A finding that HHI "systematically" understated the prices for its home market sale s cannot be based 
solely on the wrong classification of a single part in one document , and the mere possibility  that 
other such errors could  also exist.  
For the above reasons, we find that the USDOC acted inconsistently with Article  6.8 of the 
Anti-Dumping  Agreement  in resorting to facts available with respect to HHI 's reporting of an LPT  part 
as non -subject merchandise.1383 In light of our finding  of WTO -inconsistency , we do not consider it 
necessary to address Korea 's claims under paragraphs 3 and 5 of Annex  II to the 
Anti-Dumping  Agreement  in order to provide a positive solution to the dispute before us.1384 
7.3.6.3.2.3   Accessories  
Factual background  
In its initial questionnaire, the USDOC instructed HHI to "separately report the price and 
cost for 'spare parts ' and 'accessories ' to ensure that product matches are based on accurate 
physical characteristics of the LPTs".1385 HHI stated that , while it had separately reported the price 
and cost for "spare parts", there was no definition for "accessories".1386 In its preliminary 
determination, the USDOC did not refer to the cost of "accessories".1387 In an additional 
 
1378 The United  States su bmits that HHI's  home -market database failed the USDOC's  "reliability check" 
as "the [[ ***]] out of the [[ ***]] sales for which [the USDOC] requested specific documentary support 
demonstrated that HHI had improperly reported the particular part". (United  States'  response to Panel 
question  No. 88, para.  148). The USDOC requested sales documentation for two home market sales 
(SEQHs  [[***]] and  [[***]]) and the misreporting that was later identified concerned the first of the 
two samples sales. The fact that t hree additional SEQHs indicated the same misreporting does not mean that 
these sales were included in the spectrum of sampled sales for which the USDOC requested specific 
documentary support.  
1379 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), pp . 25-26. 
1380 Korea's  response to Panel question No.  88, para.  107. (emphasis original)  
1381 LPT POR3 petitioner's  comments,  (Exhibit  KOR-252 (BCI)), p.  12. 
1382 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  25. (emphasis added)  
1383 LPT POR3 issues a nd decision memorandum,  (Exhibit  KOR-121), p.  26. 
1384 See, e.g. Panel Reports, EC – Salmon (Norway) , para.  7.387; and Morocco – Hot-Rolled Steel 
(Turkey) , paras.  7.105 -7.106.  
1385 LPT POR3 initial questionnaire,  (Exhibit  KOR-209), p.  D-1. 
1386 LPT POR3 Section D questionnaire response, (Exhibit  KOR-134 (BCI)), pp.  D-2-D-3 (referring to 
LPT POR3 initial questionnaire,  (Exhibit  KOR-209), appendix III).  We recall the USDOC's  definition of the 
subject merchandise:  
The scope of this order covers larg e liquid dielectric power transformers (LPTs)  having a top 
power handling capacity greater than or equal to 60,000 kilovolt amperes (60 megavolt 
amperes), whether assembled or unassembled, complete or incomplete. Incomplete LPTs are 
subassemblies consistin g of the active part and any other parts attached to, imported with or 
invoiced with the active parts of LPTs. The 'active part'  of the transformer consists of one or 
more of the following when attached to or otherwise assembled with one another:  the steel  core 
or shell, the windings, electrical insulation between the windings, the mechanical frame for 
an LPT. 
(LPT POR3 initial questionnaire,  (Exhibit  KOR-209), appendix III)  
1387 LPT POR3 decision memorandum for preliminary results,  (Exhibits  KOR-127 (BCI), KO R-135 
(public  version)), pp.  3-14. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  supplemental questionnaire, the  USDOC asked HHI to confirm that its product -specific costs did not 
include the costs of spare parts and accessories, clarifying that it was referring to "non-subject 
merchandise ".1388  
In its final determination,  the USDOC observed that it had requested HHI to report separately 
the price and costs of "accessories" of LPTs, "[f]or the purpose of determining whether the 
differences in costs between similar product matching control numbers ( i.e., CONNUMs ) reported by  
[HHI]  were due to the differences in the physical characteristics of the products within the CONNUMs 
or were the result of factors other than the physical characteristics".1389 The USDOC found that HHI 
knew what constituted an "accessory", since this term w as found in sales documentation that it 
provided, however it "refused to provide such information".1390 The USDOC stated that if HHI had 
questions regarding the definition of "accessories", it could have requested  a clarification from the 
USDOC, but it faile d to do so.1391 The USDOC thus concluded that HHI "failed to provide information 
specifically requested", namely the separate prices and costs of accessories, and "impeded this 
review by failing to act the best of its ability".1392 
Main arguments of the parties  
Korea claims that the USDOC resorted to facts available in violation of Article  6.8 of the 
Anti-Dumping  Agreement , as HHI did not "refuse [] access to", or otherwise fail to provide, 
"necessary" information.1393 Korea argues that such information was not important, and that, in any 
event, the USDOC neither provided a definition of the term "accessories", nor any guidance on how 
the information regarding prices and costs of accessories should have been structured.1394 Korea 
also claims that the USDOC acte d inconsistently with paragraph  1 of Annex  II to the 
Anti-Dumping  Agreement  by ignoring its obligation to be "precise in identifying the information that 
it needs" from a respondent.1395 According to Korea, it was the responsibility of the USDOC to 
provide, as soon as possible, a definition of "accessories" to the extent that it had a bearing on the 
use of "necessary" information in the review.1396 According to Korea, the only meaningful guidance 
provided by the USDOC was to equate "accessories" with "non-subje ct merchandise ".1397  
Korea further claims that the USDOC acted inconsistently with paragraphs 3 and 5 of 
Annex  II by disregarding verifiable and substantiated information "simply because it was not 
considered ideal while it was simply unclear what would be 'ideal ' information on the undefined 
concept of 'accessories'".1398 Korea asserts that, in any event, HHI exerted its best efforts by 
submitting all the information requested, based on its consideration of the proper meaning of the 
term "accessories " and according to the approach taken by the USDOC.1399 Korea also adds that 
"HHI did not in fact use the term 'accessories ' as a term during  the ordinary course of business", 
and it was used inconsistently only by a few customers.1400  
The United  States  respo nds that the separate reporting of the prices and costs of 
"accessories" was "necessary" for the USDOC 's determination of whether certain cost differences 
between similar product matching CONNUMs were the result of differences in physical characteristics 
or of other factors.1401 The United  States  explains that, because the same parts had been treated by 
HHI as "optional or non -optional ( i.e., as accessories or not as accessories)", there was a serious 
danger of manipulation of the gross unit price, and ultima tely, of the margin.1402 The United  States  
 
1388 LPT POR3 HHI third supplemental questionnaire, (Exhibit  KOR-128 (BCI)), p.  8. 
1389 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  26. 
1390 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  27. 
1391 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  27. 
1392 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  27. 
1393 Korea's  first written submission, paras.  771 and 784.  
1394 Korea's  first written submission, paras.  709 and 784 -788 (referring to LPT POR3 initial 
questionnaire,  (Exhibit  KOR-209), appendix III).  
1395 Korea's  first written submission, para.  785 (quoting Panel Report, Egypt – Steel Rebar , 
para. 7.155).  
1396 Korea's  response to Panel question No.  36, p.  33. 
1397 Korea's  response to Panel question No.  36, p.  34. 
1398 Korea's  first written submission, para.  838. 
1399 Korea's  first written submission, para.  786; response to Panel question No.  36, p.  34. 
1400 Korea's  first written submis sion, para.  788. 
1401 United  States'  first written submission, para.  251 (referring to LPT POR3 issues and decision 
memorandum,  (Exhibit  KOR-121), p.  26); response to Panel question No.  90, paras.  151-152. 
1402 United  States'  response to Panel question No.  90, para. 152. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  contends that the USDOC was justified in finding that that "HHI was responsible for determining 
what constituted an accessory", because "[i]t would be highly unusual for a company to sell a product 
that included acc essories and use such term in its documents, but not be able to determine what it 
sold and what the term used in its own documents means".1403 The United  States  also states that 
"the same request was made to the other respondent in POR3 , Hyosung , also withou t the term being 
defined by [the] USDOC, and the company provided the requested information".1404 Finally, the 
United  States  argues that because HHI 's information did not meet the criteria of paragraph  3 of 
Annex  II, HHI is not afforded the protections of paragraph  5 of Annex  II, and in any event, HHI did 
not act "to the best of its ability" in responding to the USDOC 's requests for information.1405 
Evaluation by the Panel  
Korea claims that the USDOC acted inconsistently wi th Article  6.8 and paragraphs 1, 3, and  5 
of Annex  II of the Anti -Dumping  Agreement  in resorting to the use of facts available in respect of 
HHI's reporting of "accessories".  
Prior to the issuance of the USDOC 's initial questionnaire, the petitioner urged the USDOC 
to request HHI to report separately the costs of "spare parts" and "accessories" in order to "provide 
the [USDOC]  with necessary information that prevent inaccurate product concordances, making 
product matches based on accurate physical character istics of the LPTs".1406 HHI objected to this 
request, stating that, while there was a definition of "spare parts" and HHI had correctly reported 
such parts separately in previous stages of the investigation, there was no definition offered by the 
petitioner  for the term "accessories".1407 HHI argued that , "[t]o the extent that Petitioner 's claim on 
'accessories ' relates to parts that are physically attached to an LPT, its claim is contrary to the 
definition of the scope of subject merchandise".1408 Noting that " accessories" are "basic components 
of common transformers" and are viewed as "essential to the operations of LPTs", HHI asserted that 
"[t]here is simply no logic in trying to exclude from the sale price parts that are normally included 
within or attached t o the LPT and are subject merchandise".1409 
In its initial questionnaire, the USDOC instructed HHI to "separately report the price and 
cost for 'spare parts ' and 'accessories ' to ensure that product matches are based on accurate 
physical characteristics of t he LPTs".1410 Although HHI could find guidance  on the meaning of "spare 
parts" in the definition given by the USDOC in its issues and decisions memorandum of the original 
determination1411, at no stage did the USDOC provide a definition of the term "accessories". 
In response, HHI reiterated that, while it had separately reported the price and cost for "spare parts", 
there was no definition for "accessories", and recalled that, pursuant to the USDOC 's questionnaire 
and the definition of subject mercha ndise, parts that are physically attached to an LPT fall within the 
scope of the subject merchandise.1412 In the additional supplemental questionnaire, the USDOC 
 
1403 United  States'  response to Panel question No.  36, paras.  140-141. 
1404 United  States'  response to Panel question No.  36, para.  141. 
1405 United  States'  first written submission, para.  262. 
1406 LPT POR3 petitioner's  comments on questionnaires to be issu ed, (Exhibit  KOR-131), p.  2. The 
petitioner made this request in order to prevent distortions that might occur "when the product concordance 
matches otherwise physically dissimilar LPTs, or when the concordance disqualifies physically very similar LPTs 
from comparison, simply because the matching LPTs passed or failed the 20 percent difference -in-merchandise 
('DIFMER')  test as a result of inconsistent reporting of spare parts and accessories". (Ibid.).  
1407 LPT POR3 HHI response to petitioner's  comments, (Exhibit KOR-132), p.  3. HHI understood the 
definition of "spare parts" as parts that are not needed to assemble an incomplete LPT, in accordance with the 
USDOC's  statement in the issues and decision memorandum for its determination in the original investigatio n. 
(LPT issues and decision memorandum, (Exhibit KOR -145), p.  29; see also ibid. fn 4).  
1408 LPT POR3 HHI response to petitioner's  comments, (Exhibit  KOR-132), p.  3. 
1409 LPT POR3 HHI response to petitioner's  comments, (Exhibit  KOR-132), p.  4. 
1410 LPT POR3 initial  questionnaire,  (Exhibit  KOR-209), p.  D-1. 
1411 LPT POR3 HHI response to petitioner's  comments, (Exhibit  KOR-132), fn 4 (referring to LPT issues 
and decision memorandum, (Exhibit KOR -145), p.  29). 
1412 LPT POR3 Section D questionnaire response, (Exhibit  KOR-134 (BCI)), pp.  D-2-D-3 (referring to 
LPT POR3 initial questionnaire,  (Exhibit  KOR-209), appendix III).  We recall the USDOC's  definition of the 
subject merchandise:  
The scope of this order covers larg e liquid dielectric power transformers (LPTs)  having a top 
power handling capacity greater than or equal to 60,000 kilovolt amperes (60 megavolt 
amperes), whether assembled or unassembled, complete or incomplete. Incomplete LPTs are 
subassemblies consistin g of the active part and any other parts attached to, imported with or 
invoiced with the active parts of LPTs. The "active part"  of the transformer consists of one or 
 WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  asked HHI to confirm that its product -specific costs did not include the costs of spare parts an d 
accessories, " i.e., non-subject merchandise".1413 HHI confirmed that the product -specific costs did 
not include "non-subject merchandise ".1414  
In its final determination,  the USDOC found that HHI knew what constituted an "accessory", 
as this term was found in sales documentation that it provided, however it "refused to provide such 
information".1415 The USDOC explained its view that "if [HHI]  had questions related to the def inition 
of 'accessories, ' it could have contacted the [USDOC]  to request clarification; it failed to do so, and 
instead refused to provide such information".1416 The USDOC thus concluded that HHI "failed to 
provide information specifically requested" and "im peded this review by failing to act the best of its 
ability".1417 
The above discussion reveals that even before the USDOC issued its initial questionnaire, 
HHI placed on record its concerns about the absence of a definition of "accessories".1418 The USDOC 
did not provide any definition or further clarification on what constituted "accessories", but it simply 
reiterated the scope of subject merchandise as including any part "attached to, imported with or 
invoiced with the active parts of LPTs".1419 As part of its initial request, the USDOC thus did not 
address or take into account the difficulties identified by HHI, including its assertions that there was 
no definition of "accessories" and  that, in its view, "accessories" were "essential components"  of 
LPTs, and thus fell within the definition of the "subject merchandise" in this investigation.1420 
HHI reiterated these concerns in its initial questionnaire response, however , the USDOC did not offer 
any further instructions or guidance as part of its su pplemental questionnaire and noted only that 
the "accessories" for which separate reporting was required concerned "non -subject 
merchandise".1421 
Paragraph 1 of Annex  II to the Anti -Dumping  Agreement  stipulates that , "[a]s soon as 
possible after the initiati on of the investigation", the investigating authorities shall "specify in detail 
the information required from any interested party, and the manner in which that information should 
be structured by the interested party in its response". As relevant context , we also note that 
Article  6.13 of the Anti -Dumping  Agreement  requires investigating authorities to "take due account 
of any difficulties experienced by interested parties … in supplying information requested" and to 
"provide any assistance practicable". We agree with the panel in Morocco – Hot-Rolled Steel that 
"[f]ailure by an interested party to cooperate only gives rise to the consequences envisaged by 
Article  6.8 if the investigating authority itself acted in a reasonable, objective, and impartial 
manner".1422 An examination of whether an investigating authority has complied with paragraph  1 
of Annex  II must be carried out in the particular circumstances of each case.  
Given the fact that HHI had, from the outset, expressed its concerns with respect to th e 
definition of "accessories", we agree with Korea that, by not providing further guidance as to the 
meaning of "accessories", the USDOC failed to "specify in detail" the information required from HHI 
pursuant to paragraph  1 of Annex  II. While we have no r eason to doubt the United  States'  assertion 
that the separate reporting of "accessories" constituting "non -subject merchandise" was "necessary" 
for its accurate cost determination1423, this does not, without more, absolve the USDOC from 
complying with paragraph  1 of Annex  II. We are also not convinced that HHI should have been able 
to derive a definition of "accessories" based on its internal documents.1424 We note that HHI had 
 
more of the following when attached to or otherwise assembled with one another:  the steel  core 
or shell, the windings, electrical insulation between the windings, the mechanical frame for an 
LPT. 
(LPT POR3 initial questionnaire,  (Exhibit  KOR-209), appendix III)  
1413 LPT POR3 HHI third supplemental questionnaire, (Exhibit  KOR-128 (BCI)), p.  8. 
1414 LPT POR3 HHI supplemental questionnaire response , (Exhibit  KOR-136 (BCI)), p.  22. 
1415 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  27. 
1416 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  27. 
1417 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  27. 
1418 LPT POR3 HHI response to petitioner's  comments, (Exhibit  KOR-132), p.  3. 
1419 LPT POR3 initial questionnaire,  (Exhibit  KOR-209), appendix III.  
1420 LPT POR3 HHI response to petitioner's  comments, (Exhibit  KOR-132), pp. 3-4. 
1421 LPT POR3 HHI third supplemental questionnaire, (Exhibit  KOR-128 (BCI)), p.  8. 
1422 Panel Report, Morocco – Hot-Rolled Steel , para.  7.92 (referring to Panel Report, Guatemala – 
Cement II , para. 8.251).  
1423 United  States'  first written submission, para.  251 (referring to LPT POR3 issues and decision 
memorandum,  (Exhibit  KOR-121), p.  26); response to Panel question No.  90, para.  152. 
1424 United  States'  first written submission, para.  260; response to Panel ques tion No.  36, para.  140. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 147 - 
 
  explained  why, in its view, "accessories" fell within the scope of subject merchandise, stating also 
that accessories were "viewed as essential to the operations of LPTs" by the USCIT and citing the 
petitioner 's own "Transformer Handbook", which treated accessories  as indispensable to LPTs.1425 
In these circumstances, we find that paragraph  1 of Annex  II required the USDOC to clarify the 
definition of "accessories" for purposes of HHI 's reporting obligations.  
In any event, we note that the USDOC in its final determina tion did not establish that the 
requested information (regardless of the scope and clarity of its request ) was, in fact, missing, as it 
did not identify any items which constituted "non-subject merchandise " and that should have been 
separately reported for  this reason. The USDOC simply assumed that its cost determination would 
be inaccurate due to the failure to separately report certain "accessories". Nor did  the petitioner 
identify any specific part as being misreported; rather, it simply urged the USDOC to require the 
separate reporting of "accessories ".1426 The United  States  argues that the USDOC 's resort to facts 
available was reasonable since "the same parts could have been  treated as optional or non -optional 
(i.e., as accessories or not as accessories),  there was a serious concern that certain parts could be 
selectively included/excluded from [HHI] 's home market and U.S. sales and reported gross unit 
prices at [HHI] 's discretion, which could have led to manipulation of the gross unit price".1427 In our 
view, the United States'  argument remains hypothetical, as it is unable  to identify any particular 
instance where the USDOC , in fact,  found such a "dual" classification of the same part.  
Accordingly, in the circumstances of this case, we find that, by not providing further guidance 
as to the meaning of the term "accessories" , the USDOC acted inconsistently with paragraph  1 of 
Annex  II to the Anti -Dumping  Agreement , as it failed to "specify in detail" the information required . 
Given that paragraph  1 of Annex  II serves as a precondition for an investigating authority 's proper 
resort to facts available under Article  6.8 of the Anti -Dumping  Agreement1428, we find that the 
USDOC also acted inconsistently with that provision in resorting to facts available. In light of our 
findings of WTO -inconsistency, we do not consider it necessary to rule upon Korea 's claims under 
paragraphs 3 and 5 of Annex  II to the A nti-Dumping  Agreement  in order to provide a positive 
solution to the dispute before us.1429 
7.3.6.3.2.4   Certain sales documentation  
Factual background  
Following its preliminary determination, the USDOC, by way of a supplemental 
questionnaire, requested HHI to "provide complete sales and expenses documentation (including all 
sales and expenses related documentation generated in the sales process ) for all U.S. SEQUs".1430 
In response, HHI submitted documentation totalling  over 3,300 pages.1431 In a communication with 
the petitioner, the USDOC noted that it was still considering the petitioner's request for an extension 
to submit case briefs, but clarified that it would not accept new information at such a late stage of 
the proceeding.1432 In its case brief, the petitioner identified certain inconsistencies in the 
documentation submitted by Hyundai Steel1433, with Hyundai Steel addressing these as part of its 
rebuttal brief.  
In its final determination, the USDOC found that, in addition to the three o ther identified 
inconsistencies, " [HHI]  has been systematically selective in providing various documents to the 
[USDOC] , thereby impeding the course of the review".1434 The USDOC mentioned as an "example" 
of selective reporting HHI 's deficient response to it s additional supplemental questionnaire in relation 
to the complete sales and expenses documentation for all US sales:  
 
1425 LPT POR3 HHI response to petitioner's  comments, (Exhibit  KOR-132), p.  4. 
1426 LPT POR3 petitioner's  comments on questionnaires to be issued,  (Exhibit  KOR-131), p.  2. 
1427 United  States'  response to Panel question No.  90, para.  152. (emp hasis added)  
1428 Panel Reports, China – GOES , paras.  7.384 -7.385 and 7.393 -7.394; US – Steel Plate , 
paras.  7.55-7.56.  
1429 See, e.g. Panel Reports, EC – Salmon (Norway) , para.  7.387; and Morocco – Hot-Rolled Steel 
(Turkey) , paras.  7.105 -7.106.  
1430 LPT POR3 HHI t hird supplemental questionnaire, (Exhibit  KOR-128 (BCI)), p.  5. (emphasis original)  
1431 LPT POR3 HHI third supplemental questions 13 and 17 response, (Exhibit  KOR-119 (BCI)).  
1432 LPT POR3 petitioner call memorandum,  (Exhibit  KOR-137).  
1433 LPT POR3 petitioner cas e brief, (Exhibit KOR -269 (BCI)).  
1434 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  27. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  Rather than providing the requested documentation, [HHI]  selectively reported what it 
considered "necessary" and "sufficient," thereby st ripping the [USDOC]  of its ability to 
determine what is, in fact, necessary and sufficient to calculate an accurate margin. 
Although we asked [HHI]  to submit all related documents, [HHI]  did not provide invoices 
for many expenses and instead justified its failure to provide those invoices by claiming 
that: (1) the [USDOC]  did not ask for such documents specifically; and (2 ) the [USDOC]  
accepted [HHI] 's questionnaire response regarding the  same question prior to the 
Preliminary Results . While [HHI]  refuted the fact that it failed to provide certain 
requested documents ( i.e., invoices), this particular question asked for complete sales 
and expenses documentation, including all sales and expe nses related documentation 
generated in the sales process . [HHI]  cannot excuse itself from submitting all related 
documents, such as invoices, which are vital for the [USDOC]  to verify a 
respondent 's reporting. In other words, [HHI]  was obligated to submit  the requested 
information whether it agreed with the request or not; despite its obligation, it failed to 
provide the requested information.  
Furthermore, there are other discrepancies on the record ( e.g., the values of the 
international freight and marine  insurance expenses, reported to CBP and to the 
[USDOC] , respectively). There are also issues regarding certain expenses 
(e.g., brokerage expenses ) which [HHI]  did not address in its rebuttal brief. As 
Petitioner noted, [HHI]  did not correctly allocate the  installation costs over the value of 
the transformer and spare parts in the home market. Collectively, these discrepancies 
and issues further undermine the reliability of [HHI] 's data.1435 
Main arguments of the parties  
Korea claims that the USDOC acted inco nsistently with Article  6.8 in resorting to facts 
available as HHI did not "refuse [] access to", or otherwise fail to provide, "necessary" 
information.1436 Korea points out that HHI submitted extensive documentation despite the 
USDOC 's request being "highly unusual and burdensome due to [its] extremely broad scope and late 
timing".1437 In addition, Korea argues that the USDOC simply rejected the documentation based on 
inconsistencies as claimed by the petitioner, without identifying any actual errors, and assumed the 
existence of systematic misreporting , without offering HHI an opportunity to respond, as required 
by paragraph  6 of Annex  II.1438 Korea maintains  that if the USDOC considered this information to be 
"necessary", it should have requested clarifications as there was "ample time " to do so.1439 Even if 
the USDOC considered the submitted information incomplete or imperfect, Korea argues that this 
was not suff icient to reject "summarily " the entire sales documentation.1440 According to Korea, 
there was no information on the record demonstrating that HHI "materially" or "notably" impeded 
the investigation; to the contrary, HHI fully cooperated and responded to the  extremely burdensome 
and late information request.1441 Korea further claims that the USDOC acted inconsistently with 
paragraphs 3 and 5 of Annex  II by failing to take into account verifiable information that was 
submitted in an appropriate and timely manner , and which, even if not ideal, was submitted by HHI 
acting to the best of its ability.1442 
The United  States  responds that HHI selectively reported what it considered "necessary" and 
"sufficient" and it is not the right of the respondents to decide what inf ormation is "necessary" for 
the USDOC to make its determination.1443  
 
1435 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  28. (emphasis original)  
1436 Korea's  first written submission, paras.  793 and 797.  
1437 Korea' s first written submission, para.  793. 
1438 Korea's  first written submission, para.  794. 
1439 Korea's  first written submission, para.  795. 
1440 Korea's  first written submission, paras.  796 and 838.  
1441 Korea's  first written submission, para.  797. 
1442 Korea's  first writ ten submission, paras.  796 and 838 -839; second written submission, para.  313. 
1443 United  States'  response to Panel question No.  91, para.  153. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  Evaluation by the Panel  
Korea claims that the USDOC acted inconsistently with Article  6.8 and paragraphs 3, 5, and  6 
of Annex  II of the Anti -Dumping  Agreement  in resorting to the use of fa cts available in respect of 
HHI's reporting of certain sales documentation.  
We recall that , in its supplemental questionnaire, the USDOC asked HHI to "provide complete 
sales and expenses documentation (including all sales and expenses related documentation 
generated in the sales process ) for all U.S. SEQUs".1444 In response, HHI submitt ed over 
3,300  pages of documentation.1445 The pet itioner raised certain inconsistencies regarding this 
documentation  in its case brief, and while Hyundai Steel responded to these in its rebuttal brief, it 
was unable to submit new information in light of the USDOC's guidance .1446 
In its final determination,  the USDOC rejected the information submitted by HHI in its 
entirety on the basis that HHI was "systematically selective in providing various documents". 
The USDOC explained HHI 's "pattern" of selective reporting by offering certain examples of missing 
documents, "such as invoices" "for many expenses".1447 We note that the record demonstrates that 
the final determination marked the first instance when the USDOC addressed this issue and rejected 
HHI's response as "incomplete and unreliable".1448 Before the final determination, only the petitioner 
in its case brief had alleged certain deficiencies in the information submitted by HHI.1449 
HHI responded to these arguments in its rebuttal brief.1450  
The first sentence of paragraph  6 of Annex  II requires  that "[i]f evidence or information is 
not accepted, the supplying party should be informed forthwith of the reasons therefor, and should 
have an opportunity to provide further explanations within a reasonable period, due account being 
taken of the time -limits of the investigation". The text of the provision thus envisages "due account 
being taken of the time -limits" for determining what constitutes a "reasonable period" for purposes 
of providing further explanations.1451 That said, the time -limits of an inve stigation cannot  be used 
to deprive an interested party of the opportunity to provide further explanations within the meaning 
of paragraph  6 of Annex  II, provided that all other conditions under that provision are satisfied.  
In the case at hand, it is clear that information that was requested by the USDOC in its 
supplemental questionnaire and provided by HHI was ultimately not accepted by the USDOC in its 
final determination. In such circumstances, paragraph  6 of Annex  II required the USDOC to give an 
opportunity to HHI to provide further explanations within a reasonable period, due account being 
taken of the time -limits of the investigation. However, t he USDOC never provided such an 
opportunity to HHI . We also note that although the petitioner, in its case brief submitted before the 
final determination, alleged certain deficiencies in the information submitted by HHI – that were 
addressed by HHI in its rebuttal brief – the petitioner 's submission cannot substitute the conduct 
required on the part of the USDOC under paragraph  6 of Annex  II.  
Accordingly, i n these circumstances, we find that  the USDOC acted inconsistently with 
paragraph  6 of Annex  II in re sorting to facts available because – having "not accepted" the 
information provided by HHI – the USDOC subsequently failed to give an opportunity to HHI to 
"provide further explanations within a reasonable period". Given that paragraph  6 of Annex  II serves  
as a precondition for an investigating authority 's proper resort to facts available under Article  6.8 of 
the Anti -Dumping  Agreement1452, we find that the USDOC also acted inconsistently with that 
provision in resorting to facts available. In light of our fi ndings of WTO -inconsistency, we do not 
 
1444 LPT POR3 HHI third supplemental questionnaire, (Exhibit  KOR-128 (BCI)), p.  5. (emphasis original)  
1445 LPT POR3 HHI third supplemental questions 13 and 17 response, (Exhibit  KOR-119 (BCI)).  
1446 LPT POR3 petitioner call memorandum,  (Exhibit  KOR-137).  
1447 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), pp.  27-28. 
1448 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  27. 
1449 LPT POR3 petitioner case brief,  (Exhibit  KOR-269 (BCI)).  
1450 LPT POR3 HHI rebuttal brief, (Exhibit  KOR-270 (BCI)).  
1451 See, e.g. Panel Report, Egypt – Steel Rebar , para.  7.282.  
1452 Panel Reports, China – GOES , para.  7.385;  US – Steel Plate , paras.  7.55-7.56; and Mexico – Steel 
Pipes and Tubes , para.  7.190.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 150 - 
 
  consider it necessary to rule upon Korea 's claims under paragraphs 3 and 5 of Annex  II to the 
Anti-Dumping  Agreement  in order to provide a positive solution to the dispute before us.1453 
7.3.6.3.3   The USDOC 's selection of the replacement facts  
7.3.6.3.3.1   Factual background  
The USDOC found that HHI failed "to act to the best of its ability by not providing complete 
and accurate information, th ereby raising issues as to whether [HHI] : (1) systematically overstated 
U.S. prices; and (2 ) systematically understated home market prices" .1454 The USDOC further found 
that HHI "failed to provide the [USDOC] with requested cost information, which prevented the 
[USDOC] from determining whether such costs are distorted by incomplete reporting" , and that it 
engaged in "selective reporting".1455 The USDOC applied the highest dumping margin alleged in the 
petition, 60.81%, as "total facts available with an adverse inference".1456 
The USDOC noted that, in line with the US Tariff Act, "[b]ecause the AFA rate determined 
for [HHI]  is derived from a rate in the Petition and, consequently, based upon secondary information, 
the [USDOC]  must corroborate the rate to the extent  practicable".1457 The USDOC examined the 
evidence supporting the calculations in the petition to determine the probative value of the dumping 
margins.1458 During its pre -initiation analysis, the USDOC also examined the "key elements" of the 
export price and n ormal value calculations, and "various independent sources" that "corroborate" 
the key elements of the export price and normal value calculations.1459 The USDOC explained that, 
as part of its pre -initiation analysis, it "obtained no other information that ca lls into question the 
validity of the sources of information or the validity of the information supporting the export price 
and normal value calculations provided in the Petition" .1460 On this basis, the USDOC concluded the 
highest dumping margin alleged in the petition was "reliable" for the purposes of the review.1461 The 
USDOC determined the highest dumping margin in the petition was "relevant" by examining the 
deductions and adjustments made by the petitioner in its application.1462 
7.3.6.3.3.2   Main arguments of the parties  
Korea claims that the USDOC acted inconsistently with Article  6.8 and paragraph  7 of 
Annex  II of the Anti -Dumping  Agreement  in its selection of the replacement facts  because it  failed 
to engage in an "adequate process of reasoning an evaluation " as to how or why the adverse 
inferences it made were a reasonable replacement for all of the alleged pieces of missing 
information.1463 Korea argues that the USDOC failed to corroborate the information, as required by 
paragraph  7 of Annex  II.1464 For Korea, an i nvestigating authority 's pre-initiation analysis of the 
information contained in a petition is not sufficient for the purposes of using that information in 
making a final determination.1465 Korea asserts that the USDOC acted arbitrarily to punish HHI by 
applying AFA.1466 
The United  States  responds that the USDOC considered the information contained in the 
petition, carefully selected a replacement, and corroborated it to the extent practicable using sources 
at its disposal.1467 According to the United  States , Korea has not suggested an alternative, and has 
 
1453 See, e.g. Panel Report, EC – Salmon (Norway) , para.  7.387; and Morocco – Hot-Rolled Steel 
(Turkey) , paras.  7.105 -7.106.  
1454 LPT POR3 issues and decision memorandum,  (Exhibit KOR-121), p.  4. 
1455 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  4. 
1456 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), pp.  4 and 6.  
1457 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  6. (fn omitted)  
1458 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  7. 
1459 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  7. 
1460 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  7. 
1461 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  7. 
1462 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  7. 
1463 Korea's  first written submission, paras.  855 and 858 -859. 
1464 Korea's  first written submission, paras.  856-858. 
1465 Korea's  first written submission, para.  859. See  also Korea's  response to Panel question No.  92, 
para. 111. 
1466 Korea's  first written submission, para.  860. 
1467 United  States'  first written submission, paras.  265-268. See also  United  States'  response to Panel 
question No.  92, paras.  156-157. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 151 - 
 
  not demonstrated why the replacement was improper.1468 The United  States  argues that, contrary 
to Korea 's submission, the USDOC did not apply facts available with a view to ensure a punitive rate  
and the fact that the outcome is less favourable than Korea would have liked does not mean that 
the USDOC acted inconsistently with Article  6.8.1469 
7.3.6.3.3.3   Evaluation by the Panel  
We have already found that the USDOC erred in resorting to facts available for each of the 
four issues identified above. In these circumstances, we do not consider that making further findings 
on Korea 's claims concerning the USDOC 's selection of the replacement facts on the basis of the 
record used for the USDOC 's WTO-inconsistent findings would assist in providing a positive solution 
to the dispute before us.1470 
The fourth administrative review  (POR4)  
7.3.6.4.1   Introduction  
For the POR4 proceedings, Korea claims that the USDOC acted inconsistently with Article  6.8 
and Annex  II of  the Anti -Dumping  Agreement  in using "total AFA" for the  two Korean 
producers/exporters of the subject merchandise that were selected as "mandatory respondents", 
namely, HHI and Hyosung.1471 Korea also challenges the USDOC 's determination of an "all others" 
rate for three Korean producers/exporters that were not selected for "individual examination" as 
being inconsistent with Article  9.4 of the Anti -Dumping  Agreement .1472  
We first examine Korea 's claims challenging the USDOC 's resort to facts available for HHI  
and Hyosung, respectively. In light of the USDOC 's application of "total AFA" for both HHI and 
Hyosung1473, we next address Korea 's claim that the USDOC erred in its selection of the replacement 
facts for both the mandatory respondents. Finally, we address Korea 's claim challenging the 
USDOC 's calculation of the "all others" rate for the three non -selected Korea n producers.  
7.3.6.4.2   HHI 
With respect to HHI, Korea challenges the USDOC 's resort to facts available for three issues 
concerning  (a) the reporting of accesso ries, (b) the reporting of gross unit price for certain home 
market sales , and (c ) the non -disclosure of an allegedly affiliated US sales agent.1474 We separately 
address Korea 's claims pertaining to the USDOC 's resort to facts available with respect to each of 
these three issues. For each issue, we begin by setting out the factual background, before 
summarizing the parties ' main arguments, and examining Korea 's claims under Article  6.8 and 
Annex  II of the Anti -Dumping  Agreement . 
7.3.6.4.2.1   Accessories  
Factual backg round  
The USDOC in its initial questionnaire instructed HHI to "separately report the price and cost 
for 'spare parts ' and 'accessories ' to ensure that product matches are based on accurate physical 
characteristics of the LPTs".1475 Noting that there was no definition of the term "accessories" in the 
USDOC 's questionnaire, HHI submitted that its response was in line with the scope of the subject 
 
1468 United  States ' first written submission, para.  267. 
1469 United  States'  first written submission, para.  272. 
1470 See, e.g. Panel Reports, Egypt – Steel Rebar , para.  7.310; and Mexico – Anti-Dumping Measures on 
Rice, para.  7.200. See also Panel Report, China – Broiler Produc ts, para. 7.555.  
1471 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  2; Korea's  first written 
submission, paras.  798-818 842 -845, 819 -832, and 846 -850. 
1472 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  2; Korea's  first written 
submission, para.  872. 
1473 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  3. 
1474 Korea's  first written submission, paras.  798-818 and 842 -845. 
1475 LPT POR4 Sections B -D questionnaire response, (Exhibit  KOR-144 (BCI)), p.  D-2. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 152 - 
 
  merchandise, thus including costs of all parts that are "attached to, imported with or invoiced with 
the active par ts of large power transformers".1476 
HHI subsequently filed a request for clarification of the term "accessories", stating that 
"[f]rom the records of the previous segments of this proceeding, [HHI]  has not been able to identify 
a fixed definition for the te rm 'accessories ' as used by the [USDOC]  in this question".1477 HHI asked 
the USDOC to clarify whether HHI was required to report prices for the "accessories" when sales 
documents did not indicate separate prices for such items, and, if so, to identify the me thodology 
for determining the "price".1478 HHI also asked the USDOC to provide a methodology for calculating 
"costs", when these were not readily identifiable.1479 Immediately following its request, HHI 
requested a meeting with the USDOC to discuss this issue. The USDOC asked to delay this meeting 
until after the issuance of the supplemental questionnaires, and HHI 's responses thereto.1480 
In its first supplemental sales questionnaire, the USDOC asked HHI to "explain in detail 
whether the sales documentation generated for U.S. and home market sales (in cluding the RFQ 
[(request for quotation )], sales contract, initial and/or amended purchase order contract for the 
same transaction, invoices, or other sales documents ) separately list or otherwise itemize the 
price/revenues for the main transformer body, spare parts, accessories and sales -related service 
revenues ( e.g., freight, brokerage, installation and supervision)" and requested that "[a]ll such 
separate reporting of revenues in sales documentation should result in separate reporting  of 
revenues and associated expenses in [HHI's] responses to sections B and C, per the 
[USDOC] 's instructions in the January  5, 2015, antidumping duty questionnaire".1481 In its response 
of 3 May 2017, HHI submitted worksheets with the separate values as req uested.1482 
In its second supplemental sales questionnaire, the USDOC requested HHI – in light of its 
request for clarification – to "provide a definition of how [HHI] use[d] and/or underst[ood] the scope 
of the term 'accessories ' when negotiating with [its]  customers" and to "explain [its] basis for such 
usage and/or understanding in detail".1483 It also requested HHI to "describe in detail what 
constitutes 'main bodies, ' 'spare parts, ' and 'accessories ' that [HHI]  sold in the U.S. and home 
markets in conjunct ion with sales of subject LPTs".1484 The USDOC posed a number of additional 
questions which concerned "accessories" as part of LPTs. HHI responded by recalling that HHI had 
requested such a definition from the USDOC, as it did not have a particular understan ding of the 
term in its use thereof internally or in its dealings with its customers ,1485 and reiterated its request 
for a meeting with the USDOC.1486 
The USDOC issued an additional supplemental questionnaire, asking HHI to ensure that it 
had separately report ed "accessories" in its revised Sections B -C sales files.1487 HHI responded that , 
because the USDOC was still considering its definition of an "accessory", it was unclear whether 
some items would ultimately be considered as parts ; in order to cover this poss ibility , it submitted 
 
1476 LPT POR4 Sections B -D questionnaire response, (Exhibit  KOR-144 (BCI)), pp.  D-2-D-3 
(emphasis  omitted). We recall the definition of the subject merchandise given by the USDOC:  
The scope of this order covers large liquid dielectric power transformers … h aving a top power 
handling capacity greater than or equal to 60,000 kilovolt amperes (60 megavolt amperes), 
whether assembled or unassembled, complete or incomplete.  
Incomplete large power transformers are subassemblies consisting of the active part and an y 
other parts attached to, imported with or invoiced with the active parts of large power 
transformers. The "active part" of the transformer consists of one or more of the following when 
attached to or otherwise assembled with one another:  the steel core o r shell, the windings, 
electrical insulation between the windings, the mechanical frame for a large power transformer.  
(LPT POR3 initial questionnaire,  (Exhibit  KOR-209), appendix III)  
1477 LPT POR4 request for clarification,  (Exhibit  KOR-146 (BCI)), p.  5. HHI was referring to POR3, the 
final results of which were published on 13 March 2017.  
1478 LPT POR4 request for clarification,  (Exhibit  KOR-146 (BCI)), pp.  12-15. 
1479 LPT POR4 request for clarification,  (Exhibit  KOR-146 (BCI)), pp.  12-15. 
1480 LPT POR4 HHI case brief, (Exhibit  KOR-149 (BCI)), p.  14. 
1481 LPT POR4 first supplemental sales questionnaire,  (Exhibit  USA-36 (BCI)), pp.  14-15. 
1482 LPT POR4 first supplemental sales questionnaire response, (Exhibit  USA-37 (BCI)), p.  41.  
1483 LPT POR4 second supp lemental questionnaire, (Exhibit  KOR-147 (BCI)), p.  9. 
1484 LPT POR4 second supplemental questionnaire, (Exhibit  KOR-147 (BCI)), pp.  9-10. 
1485 LPT POR4 second supplemental questionnaire response,  (Exhibit  KOR-148 (BCI)), pp.  10-11 and 
attachments 2nd SS-1-2nd SS-2. 
1486 LPT POR4 HHI request for meeting, (Exhibit  KOR-212).  
1487 LPT POR4 supplemental questionnaire, (Exhibit  USA-39 (BCI)), p.  4. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 153 - 
 
  a complementary chart, including for each of these sales the revenue and the corresponding cost.1488 
In the meantime, a meeting was held between HHI and the USDOC, where the issue of defining 
"accessories" was raised again.1489 
In its final determination, the USDOC found that HHI failed to report the price and cost of 
accessories, and this determination was part of the basis for the application of total AFA.1490 
The USDOC explained:  
Additionally, regarding [the USDOC] 's statutory obligati on under section  782 of the Act 
to notify a party of a deficiency and to provide an opportunity to explain or remedy the 
deficiency, as detailed in our [preliminary decision memorandum] PDM, we made 
multiple attempts to obtain information regarding "access ories" from [HHI] . Despite our 
requests, [HHI]  failed to provide the requested information and, instead, defaulted to 
the scope language and [the USDOC] 's historical treatment of "accessories." [HHI]  
claims it does not know what accessories are, yet claims  it already reported accessories 
as subject merchandise. In light of this reporting strategy, we followed up with 
numerous supplemental questionnaires seeking further explanation, as detailed in the 
PDM. As evinced by these supplemental questionnaires, [the USDOC]  satisfied its 
obligation to inform [HHI]  of the nature of its deficiencies regarding its reporting of 
accessories and provided [HHI]  with several opportunities to remedy or explain its 
deficient and conflicting responses. [HHI]  failed to address w hich components in its 
reporting constitute the accessories [HHI]  considers in its normal course of business, 
regardless of the scope language and [the USDOC] 's prior treatment of accessories, and 
despite repeated opportunities to do so. Accordingly, we fi nd that [HHI] 's argument 
regarding [the USDOC] 's statutory obligation under section  782(d ) is not supported.1491 
Main arguments of the parties  
Korea claims that the USDOC acted inconsistently with Article  6.8 of the 
Anti-Dumping  Agreement  because HHI did not  "refuse [] access to ", or otherwise fail to provide, 
"necessary" information, nor did it "significantly impede []" the proceedings.1492 Korea also claims 
that the USDOC acted inconsistently with paragraph  1 of Annex  II by failing to provide a definition 
of "accessories" as soon as possible.1493 According to Korea, in the absence of a definition  of 
"accessories"  by the USDOC, HHI did its "utmost" to provide in a timely manner the requested 
information and furnished all the data on "accessories " based on HHI 's understanding of the term.1494 
Korea also claims that the USDOC acted inconsistently with paragraphs 3 and 5 of Annex  II by failing 
to take into account the verifiable and substantiated information concerning "accessories", which, 
even if  not pe rfect, was submitted by HHI acting to the best of its ability.1495 Korea states that the 
data on accessories was provided based on the way that HHI interpreted and applied the term1496, 
and the USDOC never took any issue with HHI 's reporting, nor did it provid e any guidance to the 
contrary despite HHI 's repeated efforts to seek further clarifications.1497  
The United  States  maintains that, despite the USDOC 's repeated requests, HHI withheld 
"necessary" information and otherwise impeded the review.1498 According to the United  States , HHI 
bore the burden of defining the terms in respect to which information was required, in light of its 
obligation to respond to the best of its abilit y, and given that the company that uses the term is "by 
far in the best position" to understand how th at term is used.1499 Referring to the Hyosung 's reporting 
 
1488 LPT POR4 supplemental questionnaire response, (Exhibit  USA-41 (BCI)), p.  10. 
1489 LPT POR4 meeting memorandum,  (Exhibit  USA-40). 
1490 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  11. 
1491 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  11. (fns omitted)  
1492 Korea's  first written submission, paras.  799-800. 
1493 Korea's  first written submission , para.  808. 
1494 Korea's  first written submission, paras.  800-801.  
1495 Korea's  first written submission, paras.  803, 843, and 845.  
1496 Korea notes that the USDOC justified its decision to reject the information submitted relating to 
accessories based on the fact that some HHI sales documentation included the term "accessories", and thus it 
could not be considered undefined. However, Kore a emphasizes that the term was used inconsistently across 
HHI's  customers base. (Korea's  first written submission, para.  806).  
1497 Korea's  first written submission, paras.  801 and 805 -806. 
1498 United  States'  first written submission, para.  286. 
1499 United  States ' second written submission, paras.  87-88. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 154 - 
 
  and to the proposed definitions provided by the petitioner, the United  States  notes that HHI did not 
offer a definition of the term "accessories" even though it "ha d previously taken positions in its 
February response on sales of accessories" and " [w]hile acknowledging how other parties have 
attempted to define and report accessories".1500 The United  States  argues that HHI 's documentation 
reflected its awareness and und erstanding of the types of components that constituted 
accessories.1501 The United  States  also points out that HHI requested a clarification of the term 
"accessories" months after the USDOC 's initial request.1502  
Evaluation by the Panel  
Korea claims that the USDOC acted inconsistently with Article  6.8 and paragraph  1, 3, 5, 
and 6 of Annex  II of the Anti -Dumping  Agreement  in resorting to the use of facts available in respect 
of HHI 's reporting of "accessories" in POR4.  
We recall that the issue concerning the re porting of "accessories" also arose in POR3. While 
the facts relating to this issue in POR4 are similar in many respects to the situation in POR3, we note 
that in POR3 HHI expressed its reporting concerns mainly through its questionnaire responses, and 
the USDOC finally determined that HHI had misreported "accessories" and that, in case of any doubts 
as to the meaning of the term, HHI should have sought a clarification from the USDOC.1503 In POR4, 
HHI did, in fact, seek such a clarification and actively sough t to meet with the USDOC to discuss this 
issue.1504 We recall that paragraph  1 of Annex  II to the Anti -Dumping Agreement requires an 
investigating authority to "specify in detail", "as soon as possible" after the initiation of the 
investigation, the informat ion that is required and the manner in which such information should be 
structured.  
HHI underscored the absence of a general definition of the term "accessories" on multiple 
occasions during the POR4 proceedings.1505 The USDOC expressly disagreed with HHI t hat 
the USDOC was obliged to define the term "accessories".1506 Indeed, the record does not 
demonstrate  – nor does the United  States  contend – that a definition of "accessories" was, in fact, 
provided by the USDOC to HHI. Rather, the United  States  refutes Korea 's claim under paragraph  1 
of Annex  II on the ground that HHI was in the best position to define "accessories" as it had used 
the term in its internal sales documents.1507  
Although the term "accessories" appears in HHI 's sales doc umentation, we note that HHI 
explained to the USDOC that it did not have a common internal definition of "accessories" and that 
term was not used in the same sense in documents pertaining to different sales or, in some cases, 
in different documents pertain ing to a single sale.1508 Neither the United  States  nor the USDOC  
explain why HHI could be considered to have had a particular or specific understanding of the term 
"accessories" notwithstanding the evidence presented by HHI showing that the term was not use d 
consistently across its internal sales documentation. We therefore disagree with the United  States  
that the USDOC was not required to define "accessories" merely because that term was used in 
HHI's internal documents.  
 
1500 United  States'  first written submission, para.  278 (referring to LPT POR4 request for clarification,  
(Exhibit  KOR-146 (BCI)), pp.  5-12). 
1501 United  States'  first written submission, para.  286. 
1502 United  States'  first written submission, para.  278. 
1503 LPT POR3 issues and decision memorandum,  (Exhibit  KOR-121), p.  27. 
1504 LPT POR4 request for clarification,  (Exhibit  KOR-146 (BCI)), pp.  5-15. 
1505 LPT POR4 Sections B -D questionnaire response, (Exhibit  KOR-144 (BCI)), p.  D-2 (submitting that 
"there is no definition of what constitutes 'accessories'"); LPT POR4 request for clarification,  (Exhibit  KOR-146 
(BCI)), p.  5 (submitting that "[HHI]  has not been able to identify a fixed definition for the term 'accessories'  as 
used by t he [USDOC] in this question"); LPT POR4 second supplemental questionnaire response,  
(Exhibit  KOR-148 (BCI)), p.  10 (submitting that "[i]nternally, [HHI]  does not have a definition of 
'accessories.'  Moreover, there is no particular use of the term 'accessor ies' by [HHI]'s  customers."); and 
LPT POR4 HHI request for meeting, (Exhibit  KOR-212) (requesting a meeting with the USDOC to discuss the 
"'accessories'  issue raised in HHI's  responses and previous submissions").  
1506 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  13.  
1507 United  States'  second written submission, para.  88; first written submission, paras.  278, 236, 
and 315.  
1508 LPT POR4 second supplemental questionnaire response,  (Exhibit  KOR-148 (BCI)), pp.  10-16.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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In support of its position, the United States  also points to the USDOC 's observation that the 
other mandatory respondent, Hyosung, was "able to identify what an accessory is".1509 In our view, 
the fact that Hyosung reported its understanding of the term "accessories" does not have a bearing 
on the validity or genuineness of HHI 's explanation that it did not have a consistent or common 
understanding of that term in its own internal operations. We therefore consider that the 
United  States'  argument concerning Hyosung 's reporting of its understan ding of the term 
"accessories" is not relevant to the issue of  whether the USDOC  was required to provide a definition 
of "accessories" to HHI – a respondent that repeatedly informed the USDOC that it did not have a 
common understanding of that term across its operations.  
The United  States  also argues that , had HHI reported its own understanding of the term 
"accessories", the USDOC could have further analysed whether that understanding was appropriate 
for the purpose of calculating a margin, and that HHI wit hheld necessary information and otherwise 
impeded the review by not providing such definition.1510 We note in this regard that in its 
questionnaire dated 19 May 2017, the USDOC requested HHI to provide "a definition of how [HHI] 
use[s] and/or understand[s] t he scope of the term 'accessories ' when negotiating with [its] 
customers".1511 In response , HHI clearly conveyed to the USDOC that it did not have any particular 
understanding of the term "accessories" in negotiating with its customers, as was allegedly refl ected 
in the  varying usage of the term within and across sales.1512 We also note that HHI informed the 
USDOC in this response that it was reporting information regarding "accessories" based on the 
following definition : 
[HHI]  will report any component that is not "attached to, imported with or invoiced with 
the active parts of LPTs" as an "accessory," and [HHI]  will report any component that 
is "attached to, imported with or invoiced with the active parts of LPTs" as part of t he 
transformer. Thus, under this definition, [HHI]  would report any component that is 
procured for the customer and sent directly to the customer without being "attached to, 
imported with or invoiced with the active parts of LPTs" as an "accessory."1513 
Thus, HHI also clearly indicated its reporting basis to the USDOC. However, the USDOC did not 
explain why HHI 's proposed definition of the term "accessories" under the fourth administrative 
review was inappropriate for the purpose of calculating a dumping marg in. Further, while the USDOC 
noted that the "record evidence suggests that [HHI]  could have provided the ranges/types of 
components which it believes constitute accessories based on its technical knowledge and experience 
in the industry", this observation appears as an unsubstantiated assertion in the USDOC 's final 
determination.1514 The United  States  has neither identified record evidence that formed the basis of 
this observation by the USDOC, nor has it pointed us to any flaw in the evidence or the explanation 
provided by HHI that it had no consistent understanding of the term "accessories" as part o f its 
internal operations.  
The United  States  also points to an alleged inconsistency in HHI 's submissions before the 
USDOC, asserting that , on the one hand , HHI claimed not to have a particular understanding of the 
term "accessories", while , on the other  hand,  HHI argued that it had properly reported 
accessories.1515 We understand the United  States  to suggest that this alleged inconsistency reveals 
HHI's failure to properly define and submit information pertaining to "accessories" before the 
USDOC. While HHI  denied having a consistent understanding of "accessories" in its internal 
operations and in its negotiations with customers, the understanding of this term that it offered in 
its submissions before the USDOC was tailored for the purpose of the POR4 procee dings. In other 
words, while HHI denied having a general understanding of the term "accessories" in the normal 
course of business, it did propose an understanding of the term for the purpose of the 
USDOC 's investigation and reported the relevant informatio n based on that understanding.1516 
 
1509 United  States'  first written submission, para.  315.  
1510 United  States'  first written submission, para.  286; second written submission, para.  88; and opening 
statement at the first meeting of the Panel, para.  112.  
1511 LPT POR4 second supplemental questionnai re, (Exhibit  KOR-147 (BCI)), p.  9. 
1512 LPT POR4 second supplemental questionnaire response,  (Exhibit  KOR-148 (BCI)), p.  10.  
1513 LPT POR4 second supplemental questionnaire response,  (Exhibit  KOR-148 (BCI)), p.  16.  
1514 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  14. 
1515 United  States'  first written submission, para.  286 (referring to LPT POR4 issues and decision 
memorandum,  (Exhibit  KOR-211), p.  10).  
1516 LPT POR4 HHI case brief, (Exhibit  KOR-149 (BCI)), pp.  6-11. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  Thus,  contrary to the United  States'  argument, we see no inconsistency in HHI 's submissions before 
the USDOC.1517 
Accordingly, in the circumstances of this case, we find that, by not providing further guidance 
as to the meani ng of the term "accessories" , the USDOC acted inconsistently with paragraph  1 of 
Annex  II to the Anti -Dumping  Agreement , as it failed to "specify in detail" the information required. 
Given that paragraph  1 of Annex  II serves as a precondition for an investigating authority 's proper 
resort to facts available under Article  6.8 of the Anti -Dumping  Agreement1518, we find that the 
USDOC  also acted inconsistently with that provision in resorting to facts available. In light of our 
findings of WTO -inconsistency, we do not consider it necessary to rule upon Korea 's claims under 
paragraphs 3 and 5 of Annex  II to the Anti -Dumping  Agreement  in order to provide a positive 
solution to the dispute before us.1519 
7.3.6.4.2.2   Gross unit price for certain home market sales  
Factual background  
In its second supplemental questionnaire for the POR4 proceedings, the USDOC asked HHI 
to provide "complete sales and expens es documentation" for certain home -market and US sales (in 
particular SEQHs  [[***]] and SEQUs  [[***]]).1520 Having reviewed the information provided by HHI 
for "one of the home -market sales requested" (SEQH  [[***]]), in its preliminary determination the 
USDOC  found that HHI had "improperly reported its home market gross unit prices for certain home 
market sales".1521 The USDOC explained:  
Specifically, the record indicates that even though later -revised contracts identify 
different contract  values, [HHI]  continued to use the values from its initial contract to 
report its gross unit prices for certain sales, thereby understating its home market sales 
for certain home market sales. As a result, we preliminarily find that [HHI] 's reporting 
of its gross unit prices for its home market sales is not reliable. Therefore, we 
preliminarily determine that [HHI]  failed to cooperate to [the] best of its ability to 
provide complete and accurate information, thereby preventing the [USDOC]  from 
calculating an accurate margin and calling into question the accuracy of 
[HHI] 's reporting.1522 
The USDOC provided a further explanation for  its conclusion in its preliminary analysis 
memorandum, stating that " [HHI]  improperly determined its home market gross unit price  for 
[[***]] home market sales".1523 The USDOC found that for one of the [[***]] home market sales 
for which it had requested complete documentation (SEQH  [[***]]), HHI had reported the gross 
unit prices based on the original contract, while subsequent revis ions of this contract reported 
increased prices. This contract and its revisions included gross unit prices also for SEQH  [[***]], for 
which the USDOC had not requested complete documentation. The USDOC therefore preliminary 
determined that HHI had misrepo rted SEQHs  [[***]]. 
In its case brief submitted after the preliminary determination, HHI argued that it had not 
understated its home -market gross unit prices , as the changes that the USDOC observed in the 
 
1517 The United  States also points to  HHI's  reference to "accessories as a type of change that can occur 
after the initial purchase order" in HHI's  questionnaire response dated 2 February 2017. (United  States'  first 
written submission, para.  277 (referring to ( LPT POR4 Section A questionnaire  response,  (Exhibit  KOR-150 
(BCI)), p.  A-29)). We note that while the term "accessories" does appear in the questionnaire response that 
the United  States points to, this does not, in our view, contradict the evidence provided by HHI showing that 
this term was not used uniformly by HHI in its internal operations and across/within different sales.  
1518 Panel Reports, China – GOES , paras.  7.384 -7.385 and 7.393 -7.394; US – Steel Plate , 
paras.  7.55-7.56.  
1519 See, e.g. Panel Reports, EC – Salmon (Norway) , para.  7.387; and Morocco – Hot-Rolled Steel 
(Turkey) , paras.  7.105 -7.106.  
1520 LPT POR4 second supplemental questionnaire, (Exhibit  KOR-147 (BCI)), p.  13. 
1521 LPT POR4 decision memorandum (PDM),  (Exhibit  KOR-140), pp.  17-18. 
1522 LPT POR4 decision memorandum (PDM),  (Exhibit  KOR-140), p.  18. 
1523 LPT POR4 preliminary analysis memorandum,  (Exhibit  USA-43 (BCI)), pp.  2-3.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  contract prices were related solely to non -subject merchandise, and thus there was no basis to find 
that HHI had not reported gross unit prices in an accurate manner.1524 
In its final determination, the USDOC continued to find that the application of "adverse facts 
available" was warranted1525 and addressed the petitioner 's concerns as follows:  
The petitioner alleges that the initial contract for the home market sales at issue 
indicates that this certain part, which is supposed to be treated as a non -foreign like 
product, may be indeed a foreig n like product. In particular, the petitioner argues that 
the initial contract for the home market sales at issue shows that this particular part 
(i.e., the supposed non -foreign like product ) is included  within the contract under the 
"Main Transformer" des cription, which indicates that this supposed non -foreign like 
product may be indeed a foreign like product. This evidence contradicts [HHI] 's claims 
that the total contract value change between its initial contract and later -revised 
contracts is only relat ed to a non -foreign like product. Other than [HHI] 's annotation 
claiming that this part is a non -foreign like product, the record does not demonstrate 
whether it is indeed non-foreign like product.  
Additionally, due to [HHI] 's failure to provide the reques ted information regarding 
accessories, as detailed in Comment 1 above, we are unable to determine whether this 
item would be an accessory. As explained above, other than [HHI] 's annotation which 
categorized this item as non -foreign like product in its cont ract, [HHI]  did not provide 
any additional details concerning the nature of this item and how it interacts with 
merchandise under review. Therefore, we find that the record is ambiguous and there 
continues to be concern that the gross unit prices may be un derstated.1526 
The USDOC concluded that : "(1) [HHI] 's reporting of nonforeign like products is inaccurate; 
(2) there is inconsistent treatment of a certain item in its home market sales; and (3 ) by excluding 
this item, this could lead to the understatement o f the home market gross unit price for certain 
sales".1527 The USDOC applied facts available with an "adverse inference" "because such inaccurate 
and incomplete reporting gives rise to concerns of the manipulation of gross unit prices, and 
[HHI] 's continued careless reporting".1528 
Main arguments of the parties  
Korea claims that the USDOC acted inconsistently with Article  6.8 of the 
Anti-Dumping  Agreement  in resorting to facts available because information about one home market 
sale cannot, in good faith, be considered "requisite, essential, needful" – and therefore is not 
"necessary" – for purposes of the USDOC 's determination.1529 Korea also asserts that H HI had 
submitted record evidence that, in any case, would have allowed the USDOC to decide whether to 
include or exclude the cost of this part in the gross unit price for the calculation of the normal value 
of these transactions.1530 On this basis, Korea cla ims that the USDOC acted inconsistently with 
paragraphs 3 and 5 of Annex  II by discarding verifiable and appropriately submitted information.1531 
 
1524 LPT POR4 HHI case brief, (Exhibit  KOR-149 (BCI)), pp.  39-40. 
1525 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  3. 
1526 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), pp.  15-16 (emphasis original).  The 
USDOC was also concerned due to the different treatment of the same item in different home market 
sales:  "[w]hile the item names between the two sales are not identical, they indicate that the item name 
appears in the second sale as merchandise within the scope (i.e., treated as a foreign like product in the 
second sale while its treated as non -subject merchandise in the first sale)".  
1527 LPT POR4 issues and decision memoran dum, (Exhibit  KOR-211), p.  16. 
1528 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  16. 
1529 Korea's  first written submission, para.  811. Korea explains that the USDOC stated for the first time, 
in its preliminary determination, that the gross uni t prices for certain home market sales were inappropriately 
reported as HHI used values from original contracts, although later -revised contracts showed different values. 
According to Korea, HHI explained in its subsequent case brief that the revisions con cerned non -subject 
merchandise, and thus the gross -unit price was not affected. Korea notes that the USDOC finally determined 
that necessary information was missing, even though it only concluded that the "part" at issue may be subject 
merchandise, and not  that it certainly was. (Korea's  first written submission, paras.  736-737; second written 
submission, para.  328).  
1530 Korea's  first written submission, para.  812. See also Korea's  second written submission, para.  330. 
1531 Korea's  first written submission, para s. 815 and 844.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  Finally, Korea asserts that an investigating authority 's internal deadlines do not justify the 
authority 's failure to request additional information, as required by paragraph  6 of Annex  II.1532 
The United  States  maintains that HHI classified a particular component as "non -subject 
merchandise" even though this component was "always attached or assembled" to the LPT. 
The United Stated recalls that HHI reported gross unit prices for certain sales on the basis of values 
from the "initial purchase contract", while this contract had been modified twice.1533 On this basis, 
the United  States argues that HHI failed to accurately report gross -unit prices and thus the "USDOC 
was unable to accurately compare home market sales with export sales to the United States".1534 
The United  States  further refers to the USDOC 's statement that it would have been impracticable to 
send another suppl emental questionnaire as it would have  had to cover and examine significantly 
more home market sales in order to determine if HHI had understated its gross unit prices.1535 
Evaluation by the Panel  
Korea claims that the USDOC acted inconsistently with Article  6.8 and paragraphs 3,  5, and  6 
of Annex  II of the Anti -Dumping  Agreement  in resorting to the use of facts available in respect of 
HHI's reporting of the gross unit prices for certain home market  sales.  
We recall that the  USDOC preliminarily determined that HHI had understated the gross unit 
prices for SEQHs [[***]] and [[***]], because "even though later -revised contracts identif[ied] 
different contract values, [HHI]  continued to use the values from its initial contract to report its 
gross unit prices" for these two home market sale s.1536 HHI responded in its case brief that the 
USDOC "correctly identified a change between the original and revised contracts of the sale in 
question … but that change  concerned non -subject merchandise only".1537 HHI based this assertion 
on the original purchase order and the revised order, which referred to the disputed "part" as "not 
attached" to the LPT, thus allegedly indicating that it was not subject merchandise.1538 On this basis, 
HHI maintained that "the gross unit prices connected to the sale did not change" and that its 
reporting based on the original contract was accurate.1539 
The USDOC in its final determination  stated that HHI 's assertion that the LPT part at issue 
was "non -subject merchandise" was contradicted by the fact that this part was included under the 
"Main Transformer" description of the contract.1540 For the USDOC, "[o]ther than [HHI] 's annotation 
claiming that this part is a non -foreign like product, the record [did] not demonstrate whether it is  
indeed  non-foreign like product", and " [HHI]  did not provide any additional details concerning the 
nature of this item and how it interacts with merchandise under review".1541 The USDOC also stated 
that the "con cern that [HHI]  might be understating its home market gross unit price" was 
exacerbated by the fact that HHI had not treated consistently the same item between different home 
market sales.1542 As the record was "unclear" as to whether HHI 's reporting was acc urate, the 
USDOC concluded that HHI 's reporting could lead  to an understatement of the home market gross 
unit price for certain sales.1543 The USDOC ultimately applied facts available with "adverse 
inferences" because of HHI 's "inaccurate", "incomplete", and  "careless" reporting.1544 
As Korea points out, "the USDOC did not definitively conclude that the part was subject 
merchandise – only that it may be".1545 Thus, in its final determination , the USDOC rejected the 
information provided by HHI as part of its case brief aimed at demonstrating that the discrepancy 
between the original and revised contracts concerned non -subject merchandise only. The USDOC 
 
1532 Korea's  second written submission, para.  329. 
1533 United  States'  first written submission, para.  289. 
1534 United State' first written submission, para. 318.  
1535 United  States'  first written submission, paras.  288-290. 
1536 LPT POR4 decision memor andum (PDM),  (Exhibit  KOR-140), p.  18. See also LPT POR4 
second  supplemental questionnaire response,  (Exhibit  KOR-215 (BCI)), pp.  1-4. 
1537 LPT POR4 HHI case brief, (Exhibit  KOR-149 (BCI)), pp.  39-40. (emphasis omitted)  
1538 LPT POR4 HHI case brief, (Exhibit  KOR-149 (BCI)), p.  40. 
1539 LPT POR4 HHI case brief, (Exhibit  KOR-149 (BCI)), pp.  39-40. 
1540 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  15. 
1541 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), pp.  15-16. (emphasis original)  
1542 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  16. 
1543 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), pp.  16-17. 
1544 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  16. 
1545 Korea's  second wr itten submission, para.  328. (emphasis original)  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  however could not definitely conclude on the basis of the information before it as to whether the 
part at issue w as, in fact, subject merchandise.  
Paragraph 6 of Annex  II requires, in the first sentence, that "[i]f evidence or information is 
not accepted, the supplying party should be informed forthwith of the reasons therefor, and should 
have an opportunity to prov ide further explanations within a reasonable period, due account being 
taken of the time -limits of the investigation" . As relevant context, we note that Article  6.2 of the 
Anti-Dumping  Agreement  provides that : 
Throughout the anti -dumping investigation all interested parties shall have a full 
opportunity for the defence of their interests. To this end, the authorities shall, on 
request, provide opportunities for all interested parties to meet those parties with 
adverse interests, so  that opposing views may be presented and rebuttal arguments 
offered.  
In the case at hand, HHI in its case brief provided information allegedly demonstrating that 
the change between the original and revised contracts at issue concerned only non -subject 
merchandise.1546 HHI also stated that "if any questions remain[ed] as to the sales responses and 
supplemental responses supplied by [HHI]  – which are voluminous and complex  – the [USDOC]  
should resolve them by reviewing the documentation on -site with  the relevant company personnel 
at verification".1547 HHI further asserted that the discrepancy identified by the USDOC was 
"amenable to an explanation" from HHI.1548  
In its final determination , the USDOC considered the record to be "unclear" as to whether 
HHI's reporting was accurate , and for this reason it concluded that HHI 's reporting could lead  to an 
understatement of the home market gross unit price for certain sales.1549 Moreover, the USDOC 
stated that it "discovered these discrepancies regarding conflict ing treatment of certain LPT 
components late in the review stage", and "[a]t this point in time, in light of [the] statutory deadlines 
to complete the review, it became impracticable to send yet another supplemental 
questionnaire".1550 Thus, the USDOC never provided an opportunity to HHI to furnish further 
explanations regarding the  alleged  deficiency in the information supplied by HHI to demonstrate that 
any change between the original and revised contracts of the sale at issue concerned non -subject 
merchandise.1551 
From the above, it is clear that the USDOC did not accept the information and explanations 
provided by HHI in its case brief and did not provide an opportunity to HHI for furnishing further 
explanations solely  on the basis that it would be " impracticable" in light of the "statutory 
deadlines".1552 As discussed above, while paragraph  6 of Annex  II allows "due account being taken 
of the time -limits of the investigation" for purposes of determining what constitutes a "reasonable 
period" for seekin g further explanations, this does not without more mean that the time -limits of an 
investigation can be used to deprive an interested party of the opportunity to provide further 
explanations within the meaning of paragraph  6 of Annex  II, provided that all other conditions under 
that provision are satisfied. We therefore disagree with the United  States  that the USDOC was 
justified in not seeking further explanations and information from HHI in light of the applicable 
statutory deadlines.1553  
Accordingly, i n the circumstances  of this case , we find that  the USDOC acted inconsistently 
with paragraph  6 of Annex  II to the Anti -Dumping  Agreement  in resorting to facts available 
because  – having "not accepted" the information provided by HHI as it was "unclear" – the USDOC 
did not subsequently give an opportunity to HHI to provide "further explanations within a reasonable 
period , due account being taken of the time -limits of the investigation ". Given that paragraph  6 of 
 
1546 LPT POR4 HHI case brief, (Exhibit  KOR-149 (BCI)), pp.  39-40. 
1547 LPT POR4 HHI case brief, (Exhibit  KOR-149 (BCI)), p.  40. 
1548 LPT POR4 HHI case brief, (Exhibit  KOR-149 (BCI)), p.  41. See also LPT POR4 HHI post  preliminary 
comments, (Exhibit  KOR-141 (BCI)), p. 2.  
1549 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), pp.  16-17. 
1550 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  17. 
1551 LPT POR4 HHI case brief, (Exhibit  KOR-149 (BCI)), pp. 39-40. 
1552 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  17. 
1553 United  States'  first written submission, para.  290. Furthermore, we note that HHI's  case brief was 
filed on 12 October 2017, while the USDOC's  Final Determination was issued almost five months later on the 
9 March 201 8.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  Annex  II serves as a precondition for an investigating authority 's proper resort to facts available 
under Article  6.8 of the Anti -Dumping  Agreement1554, we find that the USDOC also acted 
inconsistently with that provision in resorting to facts available with respect to HHI 's reporting of 
gross unit  prices for certain home market sales in POR4.  In light of our findings of 
WTO-inconsistency, we do not consider it necessary to rule upon Korea 's claims under paragraphs 
3 and 5 of Annex  II to the Anti -Dumping  Agreement  in order to provide a positive solu tion to the 
dispute before us.1555 
7.3.6.4.2.3   US sales agent  
The last issue raised with respect to HHI 's reporting in POR4 pertains to its identification of 
an allegedly affiliated sales agent . 
Factual background  
In its initial Section A questionnaire , the USDOC made t he following requests:  
b. Provide a list of all … sales office locations … involved in the development, production, 
sale and/or distribution of the merchandise under review operated by your company 
and its affiliates. Please briefly describe the purpose of  each. Provide a complete address 
and telephone number for each of these plants, offices, and other facilities.1556 
Following HHI 's response1557, the USDOC issued a supplemental questionnaire, instructing 
HHI to "provide a chart which includes a complete list of all of (1 ) HHI's subsidiaries and/or affiliates 
and (2 ) HHI's subsidiaries and/or offices that are related to sale and/or distribution of merchandise 
under review (please include addresses)", as well as "a detailed explanation of their specific sale 
and/or distribution activities for merchandise under review during the POR".1558 Furthermore, the 
USDOC asked HHI to "describe in detail [its] relationship with each of its sales agents".1559 
Specifically, noting the petitioner 's allegation "that publicly available information shows, for 
example, that commission agent [[***]] shares the same address and phone number with [[***]]", 
the USDOC asked HHI to explain its "relationship with this company and state whether there is any 
affiliation between [[***]] and any [ HHI] entity".1560 HHI noted that it had submitted all charts of 
its subsidiaries and affiliates in its initial section  A response1561 and submitted again the list of all its 
subsidiaries and affiliates1562 while clarifying that it "is not affiliated with any of its sales agents", 
because  it compensated them when they were able to arrange a sale.1563 HHI also submitted 
evidence to demonstrate  that, contrary to the petitioner 's allegation " [[***]] is located in  [[***]], 
not [[***]]".1564 
In its preliminary determination  and the accompanying analysis, the USDOC acknowledged 
HHI's response concerning the different locations of the sales agent and [[***]]1565, but nonetheless 
found that HHI was affiliated with the sale s agent on the basis that this agent used an email address 
and a title and division that, in its view, "belong [ed]" to HHI.1566 The USDOC found that by not 
identifying this sales agent as an affiliate, HHI prevented the USDOC from conducting an 
 
1554 Panel Reports, China – GOES , para.  7.385; US – Steel Plate , paras.  7.55-7.56; and Mexico – Steel 
Pipes and Tubes , para.  7.190.  
1555 See, e.g. Panel Reports, EC – Salmon (Norway) , para.  7.387; and Morocco – Hot-Rolled Steel 
(Turkey) , paras.  7.105 -7.106.  
1556 LPT POR4 initial questionnaire, (Exhibit  USA-35), p.  A-4. 
1557 LPT POR4 Section A questionnaire response,  (Exhibit  KOR-150 (BCI)), pp.  A-7-A-10. 
1558 LPT POR4 second supplemental quest ionnaire, (Exhibit  KOR-147 (BCI)), p.  4. 
1559 LPT POR4 second supplemental questionnaire, (Exhibit  KOR-147 (BCI)), p.  30. 
1560 LPT POR4 second supplemental questionnaire response,  (Exhibit  KOR-213 (BCI)), p.  81. 
1561 LPT POR4 Section A questionnaire response,  (Exhibit KOR-150 (BCI)), attachments A -6, A-8, 
and A-9. 
1562 LPT POR4 second supplemental questionnaire response,  (Exhibit  KOR-213 (BCI)), p.  4. 
1563 LPT POR4 second supplemental questionnaire response,  (Exhibit  KOR-213 (BCI)), p.  81. 
1564 LPT POR4 second supplemental q uestionnaire response,  (Exhibit  KOR-213 (BCI)), p.  81. 
1565 LPT POR4 preliminary analysis memorandum,  (Exhibit  USA-43 (BCI)), p.  5. 
1566 LPT POR4 preliminary analysis memorandum,  (Exhibit  USA-43 (BCI)), p.  5. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 161 - 
 
  arm's -length analysis and calculating an accurate margin, as the indirect selling expenses related to 
this agent could have been understat ed.1567  
HHI subsequently submitted its post -preliminary comments, addressing, inter alia , the 
USDOC 's "factual assertion" about the alleged US sales agent. The USDOC , however,  rejected this 
submission in its entirety as it contained "new factual information " and noted that HHI would have 
a "full and fair opportunity " to present its arguments regarding the preliminary results, absent the 
new factual information, in its case and rebuttal briefs.1568 HHI resubmitted its post -preliminary 
comments, having redacted all the "new factual information" identified by the USDOC.1569 HHI urged 
the USDOC to conduct the previously -planned verification, in order to examine the independence of 
this agent.1570 As part of its case brief, HHI asserted that the USDOC had not establishe d that the 
relationship between the two entities satisfied the statutory definition of "affiliated persons" and that 
nothing indicated that HHI had failed to disclose some aspect of its relationship with the sales 
agent.1571 
In its final determination , the U SDOC continued to find that HHI was affiliated with this sales 
agent and that HHI had failed to report such affiliation, thereby preventing the USDOC from 
examining whether the selling expenses were reported accurately:  
Specifically, we find that the avail able record evidence, which is otherwise incomplete 
and unreliable for the reasons discussed above, demonstrates that [HHI]  was affiliated 
with a certain sales agent in the United  States  based on the fact that this sales agent 
uses an email address and a t itle and a division that belongs to [HHI] . After examining 
parties ' comments and the record evidence, we continue to find that [HHI]  failed to 
provide complete and accurate information regarding its precise relationship with this 
sales agent as to whether this agent is affiliated. Therefore, [HHI]  should 
have: (1) reported that its New Jersey sales agent office was involved in the sale of 
merchandise under review; and (2 ) included the associated selling expenses as part of 
its indirect selling expenses. By not disclosing the precise relationship between [HHI]  
and this sale agent, [HHI]  failed to cooperate to the best of its ability to provide 
complete and accurate information regarding its affiliated parties.1572 
Main arguments of the parties  
Korea claims that  the USDOC resorted to facts available inconsistently with  Article  6.8 of the 
Anti-Dumping  Agreement , as the information regarding the one sales agent at issue was not 
"necessary", and , in any event, HHI had submitted record evidence demonstrating that it "is not 
affiliated with any of its sales agents", thus no information was, in fact, "refuse[d] access  to" or 
otherwise "not provide[d]", nor was the review process "significantly impede[d]".1573 Korea claims 
that the USDOC also acted inconsistently with paragraphs 3 and 5 of Annex  II by failing to take into 
account verifiable information that was submitted in an appropriate and timely manner, and which, 
even if not ideal, was submitted by HHI acting to the best of its ability.1574 Furthermore, according 
to Korea, the USDOC failed to notify HHI of any specific deficiencies relat ing to the information 
concerning  the sales agent and did not issue any follow -up requests, as required by the first sentence 
of paragraph  6 of Annex  II.1575 
The United  States  responds that the USDOC reasonably determined that HHI failed to 
provide complete information regarding its affilia ted sales agent and properly rejected the new and 
unsolicited information that HHI attempted to submit in this regard.1576 The United  States  
 
1567 LPT POR4 decision memorandum (PDM),  (Exhibit  KOR-140), p.  18. 
1568 LPT POR4 USDOC Moses Y. Song memorandum, (Exhibit  KOR-151).  
1569 LPT POR4 HHI post preliminary comments, (Exhibit  KOR-141 (BCI)), p.  2. 
1570 LPT POR4 HHI post preliminary comments, (Exhibit  KOR-141 (BCI)), p.  6. 
1571 LPT POR4 HHI case br ief, (Exhibit  KOR-149 (BCI)), pp.  43-46. 
1572 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), pp.  18-19. (fn omitted)  
1573 Korea's  first written submission, paras.  814-816. 
1574 Korea's  first written submission, paras.  815, 837, 842, and 845.  
1575 Korea's  first written submission, para.  815. 
1576 United  States'  first written submission, paras.  321-322. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 162 - 
 
  emphasizes that despite the multiple opportunities that the USDOC provided to HHI in order to report 
its affiliates, HHI still failed to report its relationship with th e sales agent  at issue .1577 
Evaluation by the Panel  
Korea claims that the USDOC acted inconsistently with Article  6.8 and paragraphs 3, 5, and  6 
of Annex  II of the Anti -Dumping  Agreement  in resorting to the use of facts available in respect of 
HHI's reporting of one US sales agent.  
We note that, as part of its second supplemental response, HHI, based on supporting 
evidence, asserted that it "is not affiliated with any of its sales agents".1578 In its prelimina ry 
determination , the USDOC found that HHI was affiliated with one of its sales agent s on the basis 
that this agent used an email address and a title and division that, in its view, belonged to HHI.1579 
In its final determination , the USDOC continued to find that HHI was affiliated with the sales agent 
for the same reasons .1580 The USDOC concluded that HHI "failed to provide complete  and accurate  
information regarding its precise relationship with this sales agent as to whether this  agent is 
affiliated".1581  
As discussed above, HHI attempted to respond to the USDOC 's preliminary finding by way 
of post -preliminary comments ; however, the USDOC rejected its submission on the ground that it 
contain ed "new factual information".1582 HHI resub mitted its post -preliminary comments, having 
redacted all the "new factual information".1583 HHI also urged the USDOC to conduct verification so 
as to "readily examine registration documentation for the e -mail address, employment records, and 
other records r elating to the sales agent – demonstrating that he is independent of [HHI] ".1584 
Similarly, as part of its case brief, HHI reiterated its request "to submit new factual information to 
rebut, correct, or clarify the [USDOC] 's erroneous factual statement regar ding the sales agent 's use 
of [HHI] 's email address"1585, and also urged the USDOC to "invite it to refile its post -preliminary 
comments, including the new factual information" for this purpose.1586 The record thus indicates 
that, following the preliminary det ermination, HHI made several attempts to explain that the email 
address identified by the USDOC did not belong to  HHI, and that the title used by the sales agent 
did not indicate that it was affiliated with HHI. HHI repeatedly requested permission to submit 
evidence in support of its assertions, which was never granted by the USDOC.  
The first sentence of p aragraph 6 of Annex  II requires that , "[i]f evidence or information is 
not accepted, the supplying party should be informed forthwith of the reasons therefor, and should 
have an opportunity to provide further explanations within a reasonable period, due account being 
taken of the time-limits of the investigation" . As relevant context, we note that Article  6.2 of the 
Anti-Dumping  Agreement  provides that : 
Throughout the anti -dumping investigation all interested parties shall have a full 
opportunity for the defence of their interests.  To this end, the authorities shall, on 
request, provide opportunities for all interested parties to meet those parties with 
adverse interests, so that opposing views may be presented and rebuttal arguments 
offered.  
While the USDOC found in its preliminary  determination  that HHI was affiliated with the sales 
agent on the basis that this agent used an email address and a title and division that belonged to 
HHI, HHI presented arguments questioning the factual basis of the USDOC 's preliminary findings in 
 
1577 United  States'  first written submission, para.  296. 
1578 LPT POR4 second supplemental questionnaire response,  (Exhibit  KOR-213 (BCI)), p.  81. 
1579 LPT POR4 preliminary analysis memorandum,  (Exhibit  USA-43 (BCI)), p.  5. 
1580 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), pp.  18-19. 
1581 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  19. (emphasis added)  
1582 LPT POR4 USDOC Moses Y. Song mem orandum, (Exhibit  KOR-151).  
1583 LPT POR4 HHI post preliminary comments, (Exhibit  KOR-141 (BCI)), p.  2. The context surrounding 
the redacted comments indicates to us that the "new factual information" rejected by the USDOC pertained to 
demonstrating that the email address used by the sales agent did not belong to HHI. ( LPT POR4 HHI post 
preliminary comments, (Exhibit  KOR-141 (BCI)), p.  6). 
1584 LPT POR4 HHI post preliminary comments, (Exhibit  KOR-141 (BCI)), p.  6. 
1585 LPT POR4 HHI case brief, (Exhibit  KOR-149 (BCI)), p.  44. 
1586 LPT POR4 HHI case brief, (Exhibit  KOR-149 (BCI)), p.  48. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 163 - 
 
  its case and rebuttal briefs.1587 It is clear that – despite repeated requests by HHI – the USDOC 
never allowed HHI to place on the record information allegedly demonstrating that the email address 
and title used by the sales agent at issue did not, in fact, belo ng to HHI.  In light of the explanation 
provided by the USDOC, the fact that the sales agent used a particular email address and title, and 
the USDOC 's inference that these belonged  to HHI, constituted an important basis for the 
USDOC 's findings. In these c ircumstances, we consider that "an opportunity to provide further 
explanations" for purposes of paragraph  6 of Annex  II required more than a mere cursory rejection 
of the information supplied by HHI and ought to have allowed HHI to present information that, in its 
view, demonstrated that the email address and the title used by the sales agent at issue did not 
belong to H HI.  
Accordingly, in the circumstances of this case, we find that the USDOC acted inconsistently 
with paragraph  6 of Annex II to the Anti -Dumping  Agreement  in resorting to facts available 
because  – having not accepted HHI 's submission that it was not affil iated with any of its sales 
agents  – the USDOC  did not  subsequently give an opportunity to HHI to provide "further 
explanations within a reasonable period". Given that paragraph  6 of Annex  II serves as a 
precondition for an investigating authority 's proper  resort to facts available under Article  6.8 of the 
Anti-Dumping  Agreement1588, we find that the USDOC also acted inconsistently with that provision 
in resorting to facts available with respect to HHI 's reporting of a US sales agent in POR4. In light of 
our findings of WTO -inconsistency, we do not consider it necessary to address Korea 's claims under 
paragraphs 3 and 5 of Annex II to the Anti-Dumping  Agreement  in order to provide a positive 
solution to the dispute before us.1589  
7.3.6.4.3   Hyosung  
With respect to Hyosung, Korea challenges the USDOC 's resort to facts available for three 
issues concerning the reporting of  (a) service -related revenues , (b) an overlapping invoice between 
two PORs , and (c) certain discounts and price adjustments.1590 For each issue, we be gin by setting 
out the factual background, before summarizing the parties ' main arguments, and examining 
Korea 's claims under Article  6.8 and Annex  II of the Anti -Dumping  Agreement . 
7.3.6.4.3.1   Service -related revenues  
Factual background  
In its initial Section C quest ionnaire, the USDOC asked Hyosung to "report revenue in 
separate fields ( e.g., ocean freight revenue, inland freight revenue, oil revenue, installation, 
etc.) and identify the related expense(s ) for each revenue".1591 Hyosung in its response explained 
the in stances for which it reported separately service -related revenues, based on whether 
Hyosung/HICO America was responsible for the provision and was assuming the risk of the 
calculation of the cost for this service, or such costs were itemized and separately  negotiated.1592 
In its supplemental Section A questionnaire, the USDOC requested Hyosung to provide the 
order of acknowledgement forms (OAFs ) issued by HICO America for all the [[***]] sales that 
occurred during the POR.1593 Hyosung had initially reported that such OAFs were supplied to Hyosung 
by HICO America upon the receipt of a purchase order or contract of a customer.1594 Hyosung 
complied with the USDOC 's supplemental query.1595 The USDOC subsequently issued a Sections B -C 
supplemental questionnaire that included a number of questions related to service -related 
 
1587 LPT POR4 USDOC Moses Y. Song memorandum, (Exhibit  KOR-151).  
1588 Panel Reports, China – GOES , para.  7.385; US – Steel Plate , paras.  7.55-7.56; and Mexico – Steel 
Pipes and Tubes , para.  7.190.  
1589 See, e.g. Panel Reports, EC – Salmon (Norway) , para.  7.387; and Morocco – Hot-Rolled Steel 
(Turkey) , paras.  7.105 -7.106.  
1590 Korea's  first written submission, paras.  819-832 and 846 -850. 
1591 LPT POR4 initial questionnaire, (Exhibit  USA-35), p.  C-1. 
1592 LPT POR4 Hyosung Sections B -D questionnaire response,  (Exhibit  KOR-153 (BCI)), pp.  C-23-C-24.  
1593 LPT POR4 Hyosung supplemental Section A questionnaire response,  (Exhibit  KOR-154 (BCI)), 
p. S-21 and exhibit  S-18. 
1594 LPT POR4 Hyosung Sectio n A questionnaire response,  (Exhibit  KOR-152 (BCI)), p.  A-18. 
1595 LPT POR4 Hyosung supplemental Section A questionnaire response,  (Exhibit  KOR-154 (BCI)), 
p. S-21 and exhibit  S-18. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 164 - 
 
  revenues.1596 Specifically, the USDOC asked Hyosung to "explain in detail whether the sales 
documentation generated for both sales in Korea and in the United  States  separately list, or 
otherwise itemize, the prices and/or revenues for the main transformer body, spare parts, 
accessories, and/or sales -related service revenues ( e.g., freight, brokerage, installation, and 
supervi sion)".1597 Hyosung responded that for US sales it had reported separate revenues in 
instances where the HICO invoice , upon request of the customer, identified such revenues in 
separate line items.1598 For home market sale s, Hyosung noted that the tax invoices  did not itemize 
revenues or prices separately.1599 
In addition, for each of the reported net price variables for both home -market and US sales, 
Hyosung was instructed to describe how it calculated the service -related revenues.1600 In particular, 
for US sales,  the USDOC asked Hyosung to ensure that, if the ocean freight revenue was separately 
identified on any sales documents , Hyosung should identify such documents and provide copies of 
those documents; and if the reported value was based upon an allocation, to explain that 
methodology.1601 Hyosung responded that it had reported all ocean freight revenue based on the 
information contained in the commercial invoice  issued to the customer, and that it had not reported 
separately such revenues when they  were not specified in a separate line in the invoice.1602 Hyosung 
also submitted complete sales and expenses documentation for certain US and home market 
sales1603 as requested by the USDOC.1604  
The petitioner in its pre -preliminary comments identified certain  deficiencies in 
Hyosung 's supplemental responses1605, and Hyosung responded to these comments.1606 In its 
preliminary determination , the USDOC  noted that the majority of the OAFs submitted were illegible, 
and further  found that service -related revenues exceed ed the relevant expenses, thus distorting the 
net US price and the calculation of the antidumping margin:  
However, an examination of the few legible, partial OAFs submitted by Hyosung 
indicates that HICO America dedicates a portion of the sales price charg ed to its U.S. 
customers to cover service -related expenses. An analysis of the reported service -related 
expenses as compared to the allocations by Hyosung of revenues to cover these 
expenses demonstrates that the service -related revenues exceed the expense s, and 
that Hyosung did not reduce the price charged to the customer for the revenues in 
excess of the services provided. The allocation of revenues, as shown in the OAFs, are 
not reflected in the section  C sales database/chart in Exhibit SBC -32(1). Theref ore, 
service -related revenues exceed the underlying service -related expenses and Hyosung 
neither reduced the revenues collected from its U.S. customers for these expenses nor 
reported them separately so that the [USDOC]  could cap the revenues, thus distort ing 
the [USDOC] 's calculation of the antidumping duty margin by artificially increasing the 
net U.S. price, and thereby artificially decreasing the margin of dumping.1607 
The USDOC noted that because most of the information in OAFs was illegible, it could no t 
conclude that all the "necessary " requested information was on the record.1608 The USDOC concluded 
that Hyosung failed to provide the service -related revenues information requested even though such 
information was available , as demonstrated by the few legible OAFs, and thus prevented the USDOC 
from applying its "capping methodology " and impeded the review proceeding.1609 
 
1596 LPT POR4 Hyosung third supplemental questionnaire, (Exhibit  KOR-155).  
1597 LPT POR4 Hyosung third supplemental questionnaire, (Exhibit  KOR-155), p.  5. 
1598 LPT POR4 Hyosung third supplemental questionnaire response, (Exhibit  KOR-156 (BCI)), p.  9. 
1599 LPT POR4 Hyosung third supplemental questionnaire response, (Exhibit  KOR-156 (BCI)), p.  9. 
1600 LPT POR4 Hyosung third supplemental questionnaire, (Exhibit  KOR-155), pp.  6-8. 
1601 LPT POR4 Hyosung third supplemental questionnaire, (Exhibit  KOR-155), p.  9. 
1602 LPT POR4 Hyosung third supplemental questionnaire response, (Exhibit  KOR-156 (BCI)), p.  27. 
1603 LPT POR4 Hyosung third supplemental questionnaire, (Exhibit  KOR-155), p.  13. 
1604 LPT POR4 Hyosung third supplemental questionnaire response, (Exhibit  KOR-156 (BCI)), p.  41 and 
exhibit  SBC-66. 
1605 LPT POR4 petitioner pre -preliminary comments, (Exhibit  KOR-158 (BCI)).  
1606 LPT POR4 Hyosung response to comments by petitioner, (Exhibit  KOR-159 (BCI)).  
1607 LPT POR4 decision memorandum (PDM),  (Exhibit  KOR-140), pp. 8 -9. (fns omitted)  
1608 LPT POR4 decision memorandum (PDM),  (Exhibit  KOR-140), p.  9. 
1609 LPT POR4 decision memorandum (PDM),  (Exhibit  KOR-140), p.  9. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 165 - 
 
  
In its case brief, Hyosung argued that in its responses it had relied on the sales invoice for 
the revenue r eporting, and that the USDOC at no point prior to the preliminary determination took 
issue with this manner of reporting.1610 Nor did the USDOC indicate that the OAF may be an 
appropriate basis for Hyosung to report its service -related revenues.1611 Hyosung st ated that, in any 
event, any deficiencies could be resolved with a supplemental questionnaire or upon verification.1612 
In its final determination, the USDOC maintained that Hyosung had failed to respond 
accurately and completely with respect to the service -related revenues.1613 The USDOC disagreed 
with Hyosung that its questions were based on the premise that reporting revenues on the basis of 
invoices was the correct methodology:  
However, if that were true, [the USDOC]  would have no need to ask the further 
questions that it asked of Hyosung with respect to this issue. [The 
USDOC] 's questionnaire does not direct a respondent to create separate fields for 
additional charges only if they appear on the invoice. Indeed, included in the question 
is a statement that "all price adjustments granted, including discounts and rebates, 
should be reported in these fields. The gross unit price less price adjustments should 
equal the net amount of revenue received from the sale." It is clear that [the USDOC]  
requests that a re spondent report all price adjustments, whether or not they appear on 
an invoice to a customer.1614 
The USDOC also explained why it considered that an OAF, despite being an internal document, 
contain ed sales information that  would have  allowed Hyosung to calculate service -related 
revenues.1615 
Main arguments of the parties  
Korea claims that the USDOC acted inconsistently with Article  6.8 of the 
Anti-Dumping  Agreement  in resorting to facts available as Hyosung did not "refuse [] access to",  or 
otherwise fail to  provide, "necessary" information; nor did it "significantly impede []" the 
proceedings .1616 Korea argues that there was no missing information that was "necessary" in the 
sense of being "requisite, essential, needful" for the USDOC 's determination , as "[t]he USDOC did 
not issue any follow -up questionnaires or notify Hyosung of any deficiencies in its reporting of 
service -related revenue thereafter, nor [did it] make any explicit requests or express any concerns 
regarding the OAFs  submitted by Hyosung".1617 Korea claims that the USDOC also acted 
inconsistently with paragraphs 3 and 5 of Annex  II by failing to take into account verifiable 
information that was submitted in an appropriate and timely manner, and which, even if not ideal, 
was submitted by Hyosung acting to the best of its ability.1618 Korea asserts that there was no basis 
to conclude that Hyosung had failed to cooperate, given that it had reported the service -related 
revenues on the basis of the invoices, as indicated in the USDOC 's questioning.1619 Furthermore, 
Korea asserts that the USDOC was not justified in resorting to facts available as it failed to inform 
Hyosung of any deficiencies in its reporting and to request any further explanations regarding the 
information submitt ed by Hyosung, as required under the first sentence of paragraph  6 of 
Annex  II.1620  
The United  States  focuses on the USDOC 's explanation as to why the OAFs for all US sales 
were necessary for the investigation.1621 The United  States  recalls that the OAFs subm itted were 
incomplete and only partially legible, and thus the record was lacking information "necessary" to 
 
1610 LPT POR4 Hyosung case brief, (Exhibit  KOR-157 (BCI)), pp.  15 and 18.  
1611 LPT POR4 Hyosung case brief, (Exhibit  KOR-157 (BCI)), pp.  15 and 19.  
1612 LPT POR4 Hyosung case br ief, (Exhibit  KOR-157 (BCI)), p.  21. 
1613 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  26. 
1614 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  27 (referring to LPT POR4 initial 
questionnaire, (Exhibit  USA-35), p.  C-18). (fn omit ted) 
1615 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), pp.  27-28. 
1616 Korea's  first written submission, para.  820. 
1617 Korea's  first written submission, para.  822. 
1618 Korea's  first written submission, paras.  846-847. 
1619 Korea's  first written submissi on, para.  823. 
1620 Korea's  first written submission, para.  822. 
1621 United  States'  first written submission, paras.  301-302. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 166 - 
 
  complete the service -related revenue calculations.1622 The United  States  also argues that the USDOC 
had provided to Hyosung "three separate opportuni ties to specifically report the relevant 
revenue -related information and Hyosung failed to do so", and for this reason the USDOC found that 
Hyosung had significantly impeded the investigation.1623 In response to Korea 's argument that the 
USDOC did not specif ically request the reporting of service -related revenues based on OAFs, the 
United  States  asserts that "[t]he issue is not whether a specific type of documentation was identified, 
but rather whether [the USDOC]  requested Hyosung to report specific informat ion", and since the 
requested information was contained in the OAFs, HHI should have reported the service -related 
revenues in light of these documents.1624 
Evaluation by the Panel  
Korea claims that the USDOC acted inconsistently with Article  6.8 and paragrap hs 3, 5, and  6 
of Annex  II of the Anti -Dumping  Agreement  in resorting to the use of facts available in respect of 
Hyosung 's reporting of service -related revenues.  
In its final determination, having found that OAFs were relevant to the examination of 
services -related revenues and expenses, and having noted that Hyosung did not report 
service -related revenues which did not appear on the invoice, the USDOC resorted to facts available 
on the ground that the USDOC was "unsure as to whether t he submitted OAFs are complete, and 
because the [OAFs] submitted [were] partially illegible".1625 Korea argues that the USDOC did not 
make specific requests of Hyosung to report information concerning service -related revenues based 
on OAFs or to submit more legible copies of the OAFs.1626 In response, the United  States contends 
that the USDOC issued "multiple supplemental questionnaires" to Hyosung, providing multiple 
opportunities to Hyosung to cure the deficiencies.1627 
Paragraph 6 of Annex  II requires, in rele vant part, that "[i]f evidence or information is not 
accepted, the supplying party should be informed forthwith of the reasons therefor, and should have 
an opportunity to provide further explanations within a reasonable period, due account being taken 
of the time -limits of the investigation" . As relevant context, we note that Article  6.2 of the 
Anti-Dumping  Agreement  provides that : 
Throughout the anti -dumping investigation all interested parties shall have a full 
opportunity for the defence of their interes ts. To this end, the authorities shall, on 
request, provide opportunities for all interested parties to meet those parties with 
adverse interests, so that opposing views may be presented and rebuttal arguments 
offered.  
We note that none of the "multiple  supplemental  questionnaires" that the United  States  
points to specifically described the basis on which the USDOC rejected information concerning 
services -related revenues supplied by Hyosung, namely  that Hyosung did not report pertinent 
information containe d in the OAFs and that the OAFs supplied by Hyosung were illegible.1628 Neither 
did these questionnaires ask Hyosung to address these particular deficiencies. Thus, we do not 
consider that the USDOC fulfilled its obligations under paragraph  6 of Annex II to the 
Anti-Dumping  Agreement  to inform Hyosung of the reasons for not accepting the information that 
had been submitted and to provide Hyosung an opportunity to furnish further explanations.  
Furthermore, the record before us demonstrates that the USDOC f irst identified deficiencies 
regarding the reporting of service -related revenues in its preliminary determination . Although the 
USDOC noted in its final determination that it had issued "multiple supplemental questionnaires" to 
Hyosung, we note that these questionnaires were issued prior to the USDOC 's preliminary 
determination wherein it first found Hyosung to have not properly reported service -related revenues. 
As we see it, an "opportunity to provide further explanations" within the meaning of paragraph  6 
 
1622 United  States'  first written submission, para.  329. 
1623 United  States'  first written submission, para.  331. 
1624 United  States'  responses to Panel question Nos.  100 and 101.  
1625 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  29. (fn omitted)  
1626 Korea's  first written submission, paras.  749, 822, and 847; opening statement at the first meeting 
of the Panel, paras.  123-124 and 127;  and second written submission, paras.  273 and 341.  
1627 United  States'  first written submission, para.  330.  
1628 United  States'  first written submission, paras.  297-301.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 167 - 
 
  can only be provided once "evidence or information is not accepted". In this case, the USDOC did 
not provide any such opportunity to Hyosung following its rejection of the information submitted by 
Hyosung in its preliminary determination.1629  
Accordingly, in the circumstances of this case  – and irrespective of whether the 
USDOC 's analysis regarding the relevance of the OAFs for its determination of 
Hyosung 's service -related revenues was appropriate – we find that the USDOC acted inconsistently 
with paragraph  6 of Annex II to  the Anti -Dumping  Agreement , because it did not  inform Hyosung 
"forthwith" of the reasons for not accepting the information that had been submitted and did not 
give Hyosung an opportunity to provide "further explanations with in a reasonable period of time" . 
Given that paragraph  6 of Annex  II serves as a precondition for an investigating authority 's proper 
resort to facts available under Article  6.8 of the Anti -Dumping  Agreement1630, we find that the 
USDOC also acted inconsistently with that provision . In light of our findings of WTO -inconsistency, 
we do not consider it necessary to address Korea 's claims under paragraphs 3 and 5 of Annex II to 
the Anti-Dumping  Agreement  in order to provide a positive solution to the d ispute before us.1631 
7.3.6.4.3.2   Invoice covering multiple US sales  
Factual background  
In its initial Section s B-D response, Hyosung reported the invoice number for each US sale 
as instructed by the USDOC.1632 In its supplemental questionnaire, the USDOC requested a 
clarification concerning the quantity and value of LPTs for US sales.1633 Hyosung reported that, when 
preparing its response to one of the USDOC 's questions concerning the reconciliation of the products 
sold and entered into the United  States  during the POR, it discovered that the total US sales value 
erroneously included values of certain LPTs that had entered into the United  States  outside the POR 
and reflected non -final invoice amounts in some instances.1634 Hyosung therefore submitted a 
revised quantity and val ue chart reflecting  these revisions.1635 
In its preliminary determination, the USDOC identified a deficiency in Hyosung 's reporting 
of the invoices for US sales. The USDOC observed that Hyosung had reported the same invoice 
number for multiple sales, and also that one of the multiple sales covered by this invoice concerned 
the previous review period.1636 The USDOC concluded that "Hyosung 's failure to explain how one 
invoice could involve multiple sales over multiple periods of review raises concerns as to th e accuracy 
and reliability of the quantity and value of sales reported to the [USDOC] ".1637 
Hyosung commented on this finding in its case brief, asserting that "[t]he record fully 
explains the basis of Hyosung 's reporting with respect to these sales, and sho uld the [USDOC]  
require any further factual support, the [USDOC]  should request that information prior to using this 
 
1629 We also note that in its post -preliminary determination case brief, Hyosung stated that  it was able 
and willing to provide information that would address the concerns expressed by the USDOC in the preliminary 
determination regarding the information on services -related revenues that Hyosung had submitted in response 
to the USDOC's  questionnai res. Hyosung noted that such concerns could be cured if the USDOC would offer 
Hyosung an opportunity to provide further explanations through a supplemental questionnaire. Hyosung 
argued to the extent that there were issues with the OAFs, that was "the resu lt of a technical production error, 
which the [USDOC] was required by law to allow Hyosung the opportunity to remedy", adding that such an 
opportunity "would not delay the [USDOC]'s  analysis or be a departure from standard investigative 
procedures". As not ed above, however, the USDOC did not provide such an opportunity to Hyosung. ( LPT POR4 
Hyosung case brief, (Exhibit  KOR-157 (BCI)), pp.  18-19 and 21 -22). 
1630 Panel Reports, China – GOES , para.  7.385; US – Steel Plate , paras.  7.55-7.56; and Mexico – Steel 
Pipes and Tubes , para.  7.190.  
1631 See, e.g. Panel Reports, EC – Salmon (Norway) , para.  7.387; and Morocco – Hot-Rolled Steel 
(Turkey) , paras.  7.105 -7.106.  
1632 LPT POR4 Hyosung Sections B -D questionnaire response,  (Exhibit  KOR-153 (BCI)), p.  C-16. 
1633 LPT POR4 Hyosung supplemental Section A questionnaire response,  (Exhibit  KOR-154 (BCI)), 
p. S-1. 
1634 LPT POR4 Hyosung supplemental Section A questionnaire response,  (Exhibit  KOR-154 (BCI)), 
pp. S-1-S-2. 
1635 LPT POR4 Hyosung supplemental Section A questionnaire response,  (Exhibit  KOR-154 (BCI)), 
pp. S-1-S-2, and exhibit  S-2. 
1636 LPT POR4 decision memorandum (PDM),  (Exhibit  KOR-140), p.  10. 
1637 LPT POR4 decision memorandum (PDM),  (Exhibit  KOR-140), p.  10. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 168 - 
 
  invoice as a basis for total AFA" .1638 According to Hyosung, the USDOC 's standard questionnaire 
instructed Hyosung to report "each U.S. sale of merchandise entered for consumption during the 
POR", and, in that instance, the unit on the invoice had entered the United  States  in a different 
POR.1639 According to Hyosung, it is not uncommon for shipment dates to differ for units covered by 
the same i nvoice, and "[t]he mere fact that the shipment of the units listed on the invoice for 
SEQUs  [[***]] also contained a unit shipped during the prior POR is of no significance, and certainly 
not grounds for the [USDOC]  to default to total AFA".1640 
In its final  determination, the USDOC found that, given Hyosung 's description of its sales 
process, it remained unclear how multiple sales could be covered by the same invoice:  
Our examination of the invoice and record evidence leaves us unclear as to the number 
of sales covered, as well as why this invoice would be used to cover multiple sales. In 
its section  A response to [the USDOC] 's antidumping duty questionnaire, Hyosung 
states that "HICO America issues the invoice to the unaffiliated customer when the 
merchandis e is delivered and/or site test is completed."1641 
The USDOC concluded that "the record [was] incomplete and the lack of explanation regarding this 
invoice render[ed] Hyosung 's reporting unreliable".1642 
Main arguments of the parties  
Korea claims that the USDO C acted inconsistently with Article  6.8 of the 
Anti-Dumping  Agreement in resorting to facts available as Hyosung did not "refuse[] access to", or 
otherwise fail to provide, "necessary" information; nor did it "significantly impede[]" the 
proceedings .1643 Korea argues that Hyosung submitted the correct information in a timely manner 
and its reporting was fully in line with the USDOC 's instructions.1644 Korea also claims that, by failing 
to use the verifiable information that was appropriately and timely submitted by Hyosung, the 
USDOC acted inconsistently with paragraphs 3 and 5 of Annex  II.1645 Further, Korea claims that the 
USDOC acted inconsistently with paragraph  6 of Annex II to the Anti-Dumping  Agreement  by failing 
to issue any follow -up questions or notif ying Hyosung of any deficiencies regarding the invoice  at 
issue.1646 
According to the United  States , "Hyosung did not explain why one invoice could cover 
multiple sales in the current review period, as wel l as a sale in the previous review period".1647 
This explanation was necessary to support the accuracy of the data reported, which was necessary 
to the USDOC 's calculation of the dumping margin.1648 
Evaluation by the Panel  
Korea claims that the USDOC acted inc onsistently with Article  6.8 and paragraphs 3,  5, and  6 
of Annex  II of the Anti -Dumping  Agreement  in resorting to the use of facts available in respect of 
Hyosung 's reporting of an invoice covering multiple sales.  
In its preliminary determination, the USD OC noted for the first time that Hyosung had 
reported the same invoice  submitted in this POR also  for a sale to the United  States  made during 
the previous POR, and concluded that "Hyosung 's failure to explain how one invoice could involve 
multiple sales ov er multiple periods of review raises concerns as to the accuracy and reliability of 
 
1638 LPT POR4 Hyosung case brief, (Exhibit  KOR-157 ( BCI)), p.  23. 
1639 LPT POR4 Hyosung case brief, (Exhibit  KOR-157 (BCI)), p.  23. 
1640 LPT POR4 Hyosung case brief, (Exhibit  KOR-157 (BCI)), p.  24. 
1641 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  30 (referring to LPT POR4 
Hyosung Section A questio nnaire response,  (Exhibit  KOR-152 (BCI)), p.  A-38). 
1642 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  31. 
1643 Korea's  first written submission, para.  825. 
1644 Korea's  first written submission, para.  826. 
1645 Korea's  first written submission, para.  848.  
1646 Korea's  first written submission, para.  827; opening statement at the first meeting of the Panel, 
para. 131.  
1647 United  States'  first written submission, para.  304. 
1648 United  States'  first written submission, para. 333. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 169 - 
 
  the quantity and value of sales reported to the [USDOC] ".1649 On this basis, the USDOC  preliminarily 
determined that Hyosung impeded the investigation. The USDOC did not issue any supplemental 
questionnaire seeking further explanations on this issue. In its case brief, Hyosung explained that , 
following the USDOC 's instructions to report "ea ch U.S. sale of merchandise entered for consumption 
during the POR", "while a single invoice may relate to multiple entries, the relevant question for 
identifying the reportable transactions for each administrative review is the timing of the entry into 
the United  States ".1650 In its final determination , the USDOC stated that it remained unclear as to 
"why this invoice would be used to cover multiple sales" given Hyosung 's statement in its 
questionnaire response that "HICO America issues the invoice to the un affiliated customer when the 
merchandise is delivered and/or site test is completed".1651 The USDOC determined that the 
application of facts available was therefore warranted , as the record was incomplete , and because 
the lack of explanation regarding the in voices rendered Hyosung 's reporting unreliable.1652 
Paragraph 6 of Annex  II requires, in relevant part, that "[i]f evidence or information is not 
accepted, the supplying party should be informed forthwith of the reasons therefor, and should have 
an opportuni ty to provide further explanations within a reasonable period, due account being taken 
of the time -limits of the investigation" . As relevant context, we note that Article  6.2 of the 
Anti-Dumping  Agreement  provides that : 
Throughout the anti -dumping investig ation all interested parties shall have a full 
opportunity for the defence of their interests.  To this end, the authorities shall, on 
request, provide opportunities for all interested parties to meet those parties with 
adverse interests, so that opposing v iews may be presented and rebuttal arguments 
offered.  
In the case at hand, the USDOC resorted to facts available based on a n alleged  "discrepancy" 
in an invoice that covered multiple US sales.1653 The specific discrepancy that the USDOC referred 
to in the fi nal determination was that the record evidence was "unclear" as to the number of sales 
covered in the invoice , as well as to how one invoice could cover multiple sales given that Hyosung 
explained that it "issues the invoice to the unaffiliated customer wh en the merchandi se is delivered 
and/or site test is completed".1654 Korea argues that the USDOC did not notify Hyosung of this 
alleged deficiency in the invoice at issue .1655 The United  States  is unable to point to anything on the 
record indicating that the USDOC informed Hyosung about this deficiency for the invoice at issue , or 
offered Hyosung an opportunity to provide further explanations in this regard. We also note that the 
alleged tension  between Hyosung 's statement that an invoice could cover multiple sales and 
its explanation that an invoice for US sales is issued upon completion of the delivery or site test was 
not set out as the basis for the USDOC 's rejection of the invoice in questio n in the preliminary 
determination. This implies that Hyosung could not have provided further explanations in this regard 
in its post -preliminary submissions.   
Accordingly, in the circumstances of this case , we find that the USDOC acted inconsistently 
with paragraph  6 of Annex II to  the Anti -Dumping  Agreement , because it did not inform Hyosung 
"forthwith" about the alleged  deficiency in the invoice at issue that was "not accepted" and because 
it did not give Hyosung an opportunity to provide "further explan ations within a reasonable period" . 
Given that paragraph  6 of Annex  II serves as a precondition for an investigating authority 's proper 
resort to facts available under Article  6.8 of the Anti -Dumping  Agreement1656, we find that the 
USDOC also acted inconsistently with that provision . In light of our findings of WTO -inconsistency, 
 
1649 LPT POR4 decision memorandum (PDM),  (Exhibit  KOR-140), p.  10. 
1650 LPT POR4 Hyosung case brief, (Exhibit  KOR-157 (BCI)), p.  23. 
1651 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  30 (referring to LPT POR4 
Hyosung Section A questionn aire response,  (Exhibit  KOR-152 (BCI)), p.  A-38). 
1652 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  31. 
1653 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), pp.  30-31. 
1654 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  30. We note that in response to 
the USDOC's  finding in the preliminary determination that Hyosung did not explain why one invoice could cover 
sales in two review periods, Hyosung explained in its post -preliminary determination case brief that "while a 
single invoice may relate to multiple entries, the relevant question for identifying the reportable transactions 
for each administrative review is the timing of the entry into the United  States". ( LPT POR4 Hyosung case brief, 
(Exhibit  KOR-157 (BCI)), p.  23).  
1655 Korea's  first written submission, para.  754. 
1656 Panel Reports, China – GOES , para.  7.385; US – Steel Plate , paras.  7.55-7.56; and Mexico – Steel 
Pipes and Tubes , para.  7.190.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 170 - 
 
  we do not consider it necessary to address Korea 's claims under paragraphs 3 and 5 of Annex II to 
the Anti-Dumping  Agreement  in order to provide a positive solution to the d ispute before us.1657 
7.3.6.4.3.3   Discount s and price adjustments  
Factual background  
In its initial questionnaire, the USDOC asked Hyosung to report all price adjustments, 
including discounts and rebates, when reporting the information concerning the quantity and price 
for each transaction (i.e. in fields 16 through 21).1658 Hyosung responded to these requests.1659 In 
its supplemental questionnaire, the USDOC referred to a US sale for which it had previously 
requested sample documentation, and asked Hyosung to submit "any do cuments referenced in, or 
attached to, the sales documents provided in the sample sale which were not otherwise included".1660 
Hyosung submitted the requested sales documentation for these sales.1661 
In its pre -preliminary comments, the petitioner asserted that certain information from the 
supplemental response contradicted Hyosung 's assertion in its "Section C Response that it did not 
provide 'any early payment discounts ,' 'any quantity discounts ' or 'any other discounts on U.S. sales 
of LPTs durin g the POR'" .1662 Specifically, the petitioner referred to certain SEQUs, for which the 
commercial invoices reflected a type of discount that was not reported or explained by Hyosung. In 
response, Hyosung explained that for SEQU  [[***]] "[t]he term [[***]]" and it did "not have 
[[***]]".1663 Similarly, for SEQUs  [[***]], Hyosung explained that the line item of the commercial 
invoice related to " [[***]]" and "this [[***]]".1664 
In its preliminary determination, the USDOC stated that it was unconvinced by 
Hyosung 's assertion that the discounts did not fit the USDOC 's definition , as they were the result of 
negotiations with the customer at the time of the purchase order.1665 The USDOC noted that the 
price negotiations at the time of the purchase order are not controll ing if the material terms of sale 
change after that date and necessitate the use of the shipment date as the date of sale.1666 In its 
case brief, Hyosung reiterated its arguments from its response to the petitioner 's comments and 
added that, for the SEQUs co ncerned, the record confirmed that Hyosung reported the full invoice 
amount in the gross unit price field taking into account the "discount" and Hyosung 's reporting 
therefore had "absolutely no impact" and was "immaterial" to the USDOC 's analysis.1667 Hyosun g 
argued that "[w]hether there was a separate line item on one of the invoices, the fact remains that 
Hyosung 's reporting captured the full amount charged to, and due from, the customer".1668 
In its final determination, the USDOC stated that it "does not request that respondents report 
net prices as the initial basis for our dumping calculations", and that "the instructions in the 
antidumping duty questionnaire specifically state that a respondent should report discounts and 
rebates".1669 The USDOC also expl ained that "[r]eporting all such adjustments to the gross unit price 
allows [the USDOC]  to examine the veracity of each claimed adjustment, and the validity of the 
reported price, as well as examine the level of trade between the respondent and its custome rs".1670 
 
1657 See, e.g. Panel Reports, EC – Salmon (Norway) , para.  7.387; and Morocco – Hot-Rolled Steel 
(Turkey) , paras.  7.105 -7.106.  
1658 LPT POR4 Hyosung Sections B -D questionnaire response,  (Exhibit  KOR-153 (BCI)), p.  C-19. 
1659 LPT POR4 Hyosung Sections B -D questionnaire response,  (Exhibit  KOR-153 (BCI)), pp.  C-19-C-26. 
1660 LPT POR4 Hyosung supple mental Section A questionnaire response,  (Exhibit  KOR-154 (BCI)), 
p. S-34. 
1661 LPT POR4 Hyosung supplemental Section A questionnaire response,  (Exhibit  KOR-154 (BCI)), 
p. S-34 and exhibit  S-32. 
1662 LPT POR4 petitioner pre -preliminary comments, (Exhibit  KOR-158 (BCI)), pp.  28-29. 
1663 LPT POR4 Hyosung response to comments by petitioner, (Exhibit  KOR-159 (BCI)), p.  24. 
1664 LPT POR4 Hyosung response to comments by petitioner, (Exhibit  KOR-159 (BCI)), p.  24. 
1665 LPT POR4 decision memo randum (PDM),  (Exhibit  KOR-140), p.  11. 
1666 LPT POR4 decision memorandum (PDM),  (Exhibit  KOR-140), p.  11. 
1667 LPT POR4 Hyosung case brief, (Exhibit  KOR-157 (BCI)), pp.  25-26. 
1668 LPT POR4 Hyosung case brief, (Exhibit  KOR-157 (BCI)), p.  25. 
1669 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), pp.  31-32. 
1670 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  32. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 171 - 
 
  The USDOC found that the failure to report such adjustments calls into question the accuracy of the 
reported prices and of the sales process.1671 
Main arguments of the parties  
Korea claims that the USDOC acted inconsistently with Article  6.8 of the 
Anti-Dumping  Agreement  in resorting to facts available as Hyosung did not "refuse[] access to", or 
otherwise fail to provide, "necessary" information; nor did it "significantly impede[]" the 
proceedings .1672 Korea contends that Hyosung properly reported all ap plicable discounts and price 
adjustments in the initial and supplemental questionnaire responses.1673 Korea focuses on the fact 
that the total amount shown on the invoice, net of all discounts, was consistent with 
Hyosung 's reported gross unit prices.1674 Korea also claims that by failing to take into account 
verifiable information, the USDOC acted inconsistently with Article  6.8 and paragraphs 3 and 5 of 
Annex  II of the Anti -Dumping  Agreement .1675 Finally, Korea claims that by failing to issue any 
follow -up inqu iries or supplemental questionnaires regarding  alleged  deficiencies in the information 
supplied by Hyosung, the USDOC acted inconsistently with paragraph  6 of Annex II to the 
Anti-Dumping  Agreement .1676 
The United  States  responds that Hyosung did not report adjustments in accordance with the 
USDOC 's instructions for certain sales during the POR.1677 According to the United  States , the USDOC 
provided opportunities to Hyosung to report the price adjustments in its initial and  supplemental 
questionnaires.1678 The United  States  also submits  that "Hyosung failed to put forth its maximum 
efforts to comply with requests for information, thereby failing to cooperate … to the best of its 
ability".1679 
Evaluation by the Panel  
Korea claims  that the USDOC acted inconsistently with Article  6.8 and paragraphs 3,  5, and  6 
of Annex  II of the Anti -Dumping  Agreement  in resorting to the use of facts available in respect of 
Hyosung 's reporting of certain discounts and price adjustments.  
We recall t hat, in its preliminary determination, the USDOC found that Hyosung failed to 
properly submit information regarding price adjustments and discounts for US sales on the ground 
that Hyosung did not report certain price adjustments that were made in price neg otiations with 
customers at the time of the purchase order.1680 While Hyosung argued that such adjustments did 
not fit the description of "price adjustments" as defined by the USDOC, the USDOC was "not 
persuaded that Hyosung was excused from reporting and explaining these adjustments".1681 In the 
final determination, th e USDOC also found that Hyosung had failed to report adjustments for interest 
revenue that it received from certain customers.1682 
Paragraph 6 of Annex  II requires, in relevant part, that "[i]f evidence or information is not 
accepted, the supplying party sho uld be informed forthwith of the reasons therefor, and should have 
an opportunity to provide further explanations within a reasonable period, due account being taken 
of the time -limits of the investigation" . As relevant context, we note that Article  6.2 of  the 
Anti-Dumping  Agreement  provides that : 
Throughout the anti -dumping investigation all interested parties shall have a full 
opportunity for the defence of their interests.  To this end, the authorities shall, on 
request, provide opportunities for all interested parties to meet those parties with 
 
1671 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  32. 
1672 Korea's  first written submission, para.  829.  
1673 Korea's  first wri tten submission, para.  830. 
1674 Korea's  first written submission, para.  830. 
1675 Korea's  first written submission, para.  850.  
1676 Korea's  first written submission, para.  849.  
1677 United  States'  first written submission, paras.  306-307. 
1678 United  States'  first wri tten submission, para.  336. 
1679 United  States'  first written submission, para.  345. 
1680 LPT POR4 decision memorandum (PDM),  (Exhibit  KOR-140), p.  11. 
1681 LPT POR4 decision memorandum (PDM),  (Exhibit  KOR-140), p.  11. 
1682 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  32.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 172 - 
 
  adverse interests, so that opposing views may be presented and rebuttal arguments 
offered.  
Korea asserts that , in Hyosung 's case bri ef responding to the USDOC 's preliminary finding 
that Hyosung failed to properly submit information regarding price adjustments made pursuant to 
negotiations with customers, Hyosung informed the USDOC  that it had reported the full amount 
invoiced to the cu stomer, accounting for all discounts.1683 Korea also states that , in respect of the 
USDOC 's concerns regarding reporting of the interest amounts, Hyosung explained to the USDOC 
that Hyosung had reported the actual amount that the customer was required to pay .1684 Korea 
claims that the USDOC improperly resorted to facts available in the final determination without 
sending Hyosung any follow -up enquiries after receiving the abovementioned clarifications  by 
Hyosung.1685 The United  States  responds by arguing that the  USDOC had provided Hyosung the 
opportunity to report all price adjustments through its initial and supplementary questionnaires.1686 
We note that in its preliminary determination, where it first addressed this issue, the USDOC stated 
that it was not convinc ed by Hyosung 's argument that the discounts at issue did not fit the definition 
of discounts in the USDOC 's questionnaires. However, the USDOC did not request further 
explanations from Hyosung, nor did it request revised information after its rejection of 
Hyosung 's understanding of "discounts".  
As to the United States'  argument that the USDOC provided Hyosung the opportunity to 
report all price adjustments through its initial and supplementary questionnaires1687, we note that 
these questionnaires invited Hyo sung to submit certain information relating to price adjustment and 
sales documentation, but they d id not address the specific clarifications  offered by Hyosung as to 
why its  reporting of price adjustments and interest amounts was adequate.  Thus, we do not  consider 
that the USDOC informed Hyosung forthwith of any alleged  deficiencies in the clarifications  that it 
provided in its case brief; nor did it give Hyosung an opportunity to provide any further explanation 
regarding such alleged deficiencies. We consider it relevant that in its post -preliminary determination 
case brief, Hyosung expressly indicated its openness to further questions from the USDOC regarding 
the basis on which Hyosung had reported prices adjustments negotiated with customers at the t ime 
of the purchase orders , as well as Hyosung 's reporting of interest revenues.1688 Insofar as the USDOC 
had doubts about the accuracy of the "sales process" due to Hyosung 's reporting, the USDOC never 
raised this issue through a supplemental questionnaire or other such means , and did not seek any 
further explanations from Hyosung on this matter.  
Accordingly, in the circumstances of this case, we find that the USDOC acted inconsistently 
with paragraph  6 of Annex II to  the Anti -Dumping  Agreement  in resorting  to facts available , because 
the USDOC  failed to inform Hyosung of any alleged  deficiencies in the clarifications that were 
provided in Hyosung 's case brief, and because it  did not give Hyosung an opportunity to provide  
"further explanation s within a reaso nable period".  Given that paragraph  6 of Annex  II serves as a 
precondition for an investigating authority 's proper resort to facts available under Article  6.8 of the 
Anti-Dumping  Agreement1689, we find that the USDOC also acted inconsistently with that provision  
in resorting to facts available with respect to Hyosung 's reporting of discounts and price adjustments . 
In light of our findings of WTO -inconsistency, we do not consider it necessary to address 
Korea 's claims under paragraphs 3 and 5 of Annex II to the Anti-Dumping  Agreement  in order to 
provide a positive solution to the dispute before us.1690 
 
1683 Korea's  first written submission, para.  850; opening statement at the first meeting of the Panel, 
para. 135 (referring to LPT POR4 Hyosung case brief, (Exhibit  KOR-157 (BCI)), pp.  25-26). 
1684 Korea's  first written submission, pa ra. 850; opening statement at the first meeting of the Panel, 
para. 135 (referring to LPT POR4 Hyosung case brief, (Exhibit  KOR-157 (BCI)), p.  26). 
1685 Korea's  opening statement at the first meeting of the Panel, para.  136; second written submission, 
paras.  273-274. 
1686 United  States'  first written submission, paras.  335-336 (referring to Hyosung initial anti -dumping 
questionnaire,  (Exhibit  USA-46 (BCI)),  p. C-18; and LPT POR4 Hyosung third supplemental questionnaire,  
(Exhibit  KOR-155), pp.  13-14, question 66).   
1687 United  States'  first written submission, paras.  335-336 (referring to LPT POR4 Hyosung 
third supplemental questionnaire,  (Exhibit  KOR-155), pp.  13-14 question 66; and Hyosung initial anti -dumping 
questionnaire,  (Exhibit  USA-46 (BCI)), p.  C-18).  
1688 LPT POR4 Hyosung case brief, (Exhibit  KOR-157 (BCI)), pp.  25-26. 
1689 Panel Reports, China – GOES , para.  7.385; US – Steel Plate , paras.  7.55-7.56; and Mexico – Steel 
Pipes and Tubes , para.  7.190.  
1690 See, e.g. Panel Reports, EC – Salmon (Norway) , para.  7.387; and Morocco – Hot-Rolled Steel 
(Turkey) , paras.  7.105 -7.106.  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  7.3.6.4.4   The USDOC 's selection of the replacement facts for HHI and Hyosung  
7.3.6.4.4.1   Factual background  
In the POR4 final results, the USDOC applied to both HHI and Hyosung the  rate of 60.81%, 
which was the rate used for HHI in the POR3 final results.1691 The USDOC explained that because 
the rate was corroborated in the previous review, it did not require corroboration in the current 
review.1692 Consistent with its findings in the p revious review, the USDOC found that the rate was 
sufficiently adverse, without being punitive or aberrational, to ensure that the uncooperative parties 
do not obtain a more favourable result by failing to cooperate than if they had fully cooperated.1693 
7.3.6.4.4.2   Main arguments of the parties  
Korea claims that the USDOC acted inconsistently with Article  6.8 and paragraph  7 of 
Annex  II of the Anti -Dumping  Agreement .1694 Korea argues that the USDOC, in selecting facts 
available in POR4, "simply built further on the error of POR3" . According to Korea, the USDOC "did 
nothing" to corroborate the use of the highest dumping margin in the petition.1695 In addition, Korea 
contends that there was no individual corroboration with respect to Hyosung, as it was not subject 
to the application of AFA in POR3.1696 Finally, Korea argues that the USDOC did not select the best 
information available to render an accu rate determination, but rather selected "particularly adverse 
information available effectively to punish HHI and Hyosung."1697 
The United  States  responds that Korea has not demonstrated that the USDOC did not use 
the "best available information" to replace the missing information.1698 According to the 
United  States , the USDOC 's selection of the replacement facts was not punitive because the USDOC 
used a relevant and reliable rate to replace HHI 's and Hyosung 's unreliable information.1699 
The United  State s contends that because the dumping margin had been properly corroborated in the 
third administrative review, there is no obligation under Annex  II to corroborate an already -used 
rate for a second time.1700 According to the United  States , the USDOC explained  that it considered 
the record evidence o f the review when determining the "probative value" of the selected rate.1701 
7.3.6.4.4.3   Evaluation by the Panel  
We have already found that the USDOC erred in resorting to facts available with respect to 
both HHI and Hyosung  for all of the issues discussed above . In these circumstances, we do not 
consider that making further findings on Korea 's claims concerning the USDOC 's selection of the 
replacement facts on the basis of the record used for the USDOC 's WTO-inconsistent finding s would 
assist in providing a positive solution to the dispute before us .1702  
7.3.6.4.5   The USDOC 's selection of an "all others" rate  
7.3.6.4.5.1   Factual background  
POR4 covered five "producers/exporters of the subject merchandise", namely, Hyosung, 
HHI, Iljin, Iljin Electric Co ., Ltd. (Iljin Electric), and LSIS Co., Ltd. ( LSIS).1703 The USDOC selected 
Hyosung and HHI as "mandatory respondents" whereas  "Iljin, Iljin Electric, and LSIS" were not 
 
1691 LPT POR4 decision memorandum (PDM),  (Exhibit  KOR-140), p.  6; LPT POR4 issues and decision 
memorandum,  (Exhibit  KOR-211), pp.  3 and 21.  
1692 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  21. 
1693 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  22. 
1694 Korea's  first written submission, para.  864. 
1695 Korea's  first written submission, para.  862. 
1696 Korea's  first written submission, para.  862. 
1697 Korea's  first writ ten submission, para.  863. 
1698 United  States'  first written submission, para.  348. 
1699 United  States'  first written submission, para.  348. 
1700 United  States'  first written submission, para.  350. 
1701 United  States'  first written submission, para.  351 (referring to LPT POR4 decision memorandum 
(PDM),  (Exhibit  KOR-140), p.  6). 
1702 See, e.g. Panel Reports, Egypt – Steel Rebar , para.  7.310;  and Mexico – Anti-Dumping Measures on 
Rice, para.  7.200. See also P anel Report, China – Broiler Products , para. 7.555.  
1703 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  2. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  selected for "individual examination".1704 In its preliminary determination, the USDOC "determined 
that a reasonable method for determining the rate for the non -selected companies is to use the rate 
applied to the mandatory respondents ( i.e., Hyosung and [HHI] ) in this administrative review" .1705 
The USDOC  thus assigned to Iljin, Iljin Electric, and LSIS the dumping margin of 60.81 %, i.e. "the 
only rate determined in this review for individual respondents".1706 In its final determination, the 
USDOC rejected comments by Iljin , objecting to the assigned margin , and agreed with the petitioner 
that the USDOC "may use the average of two AFA margins in assigning the rate to non -selected 
respondents" and that the USDOC is allowed "to use AFA rates in calculating a margin for a 
non-selected company".1707 
7.3.6.4.5.2   Main arg uments of the parties  
Korea argues that , by determining the "all others" rate for three non -selected respondents 
(Iljin, Iljin Electric , and LSIS ) based on the "AFA rates" selected for HHI and Hyosung , the USDOC 
acted inconsistently with Article  9.4 of the  Anti-Dumping  Agreement .1708 For Korea, the fact that the 
Anti-Dumping  Agreement  is silent when all margins are either de minimis  or based on facts 
available1709 does not mean that the "prohibition " under Article  9.4 no longer applies.1710 According 
to Korea, any methodology that is used for determining the all others rate must still respect the rule 
under Article  9.4 and not be based on margins established using facts available.1711 Korea points out 
that the USDOC failed to ensure that the n on-selected producers were not prejudiced by the alleged 
failure of the mandatory respondents to provide certain "necessary " information, thus violating 
Article  9.4.1712 Korea contends that the fact that the margin was lower than the aberrational margin 
that the USDOC had identified for one of the selected exporters does not affect its conclusion, and 
that alternative methodologies were available to the USDOC, such as, for example, relying on the 
margins assigned to these producers in prior reviews.1713 Korea a rgues that the application of the 
rate established for HHI and Hyosung using facts available  to the non -investigated producers 
prejudiced  the due process rights of the non -investigated producers.1714 
The United  States  argues that Korea fails to establish a prima facie  case, as it "has not even 
alleged what the cap was in that review, which is a pre -requisite to establishing that the all others 
rate exceeded the cap" for purposes of Article  9.4.1715 According to the United  States , "there would 
be no rates left once rates based on facts available are disregarded".1716 The United  States  also 
urges the Panel to not rule upon this issue because, to the extent that this gap exists in Article  9.4, 
only WTO Members are permitted to address it pursuant to Article  3.2 of the DSU and they have not 
done so.1717  
7.3.6.4.5.3   Evaluation by the Panel  
Korea claims that the USDOC acted inconsistently with Article  9.4 of the Anti -Dumping 
Agreement by assigning the margin established for HHI and Hyosung pursuant to Article  6.8 as the 
"all others" rate for the non -selected Korean exporters.1718 The United States argues that in the 
circumstances of this case, Article  9.4 of the Anti -Dumping Agreement is "inoperative", and therefore 
Korea 's claim fails.1719  
 
1704 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  2. 
1705 LPT POR4 decision memorandum (PDM),  (Exhibit  KOR-140), p.  19. 
1706 LPT POR4 decision memorandum (PDM),  (Exhibit  KOR-140), p.  19. 
1707 LPT POR4 issues and decision memorandum,  (Exhibit  KOR-211), p.  35. 
1708 Korea's  first written submission, para.  872. 
1709 Korea's  first written submission, para.  869.  
1710 Korea's  first written submissi on, para.  869 (referring to Appellate  Body Report, US – Zeroing 
(Article  21.5 – EC), para.  453).  
1711 Korea's  second written submission, para.  357. 
1712 Korea's  first written submission, para.  870. 
1713 Korea's  second written submission, paras.  357-358. 
1714 Korea's  first written submission, para.  870; second written submission, para.  354.  
1715 United  States'  second written submission, para.  98. 
1716 United  States'  second written submission, para.  99. 
1717 United  States'  second written submission, para.  100. 
1718 Korea's  first written submission, para. 872.  
1719 United States' second written submission, para. 100.  WT/DS539/ R 
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Before evaluating the merits of Korea 's claim, we discuss the legal standard set out in 
Article  9.4 of the Anti -Dumping Agreement , which  reads, in relevant part, as follows:  
When the au thorities have limited their examination in accordance with the second 
sentence of paragraph 10 of Article  6, any anti -dumping duty applied to imports from 
exporters or producers not included in the examination shall not exceed:  
(i) the weighted average ma rgin of dumping established with respect to 
the selected exporters or producers or,  
… 
provided that the authorities shall disregard for the purpose of this paragraph any zero 
and de minimis margins and margins established under the circumstances referred t o 
in paragraph 8 of Article  6.  
We note that Article  9.4 applies only in cases where investigating authorities have used 
"sampling", that is, where investigating authorities have, in accordance with Article  6.10 of the 
Anti-Dumping Agreement, limited their  investigation to a select group of exporters or producers.1720 
In such cases, the anti -dumping duty rate applied by an investigating authority to those exporters 
and producers who were not included in the investigated sample is referred to as the "all other s" 
rate.1721 We also note that Article  9.4 does not prescribe a particular method that WTO Members 
must use to determine the "all others" rate; rather, it simply identifies a maximum limit, or ceiling, 
which investigating authorities "shall not exceed" in es tablishing an "all others" rate.1722  
Subparagraph (i) of Article  9.4 sets out the general rule that the relevant ceiling is to be 
established by calculating a "weighted average margin of dumping established" with respect to those 
exporters or producers who were "selected" or investigated.1723 However, this general rule is 
qualified by the proviso that, "for the purpose of this paragraph", investigating authorities "shall 
disregard", first, zero and de minimis  margins and, second, "margins established under the  
circumstances referred to in paragraph 8 of Article  6".1724 Thus, the provision constrains the 
discretion of investigating authorities in two ways: first, by imposing a ceiling that the "all others" 
rate "shall not exceed"; and, second, by requiring investi gating authorities to disregard, for the 
purposes of that paragraph, any zero, de minimis , and "facts available" margins.1725 By requiring 
investigating authorities to disregard "facts available" margins, Article  9.4 "seeks to prevent the 
exporters, who were not asked to cooperate in the investigation, from being prejudiced by gaps or 
shortcomings in the information supplied by the investigated exporters" .1726  
We recall that the USDOC assigned to Iljin, Iljin Electric, and LSIS the dumping margin 
of 60.81 %1727, which was based on "the average of two AFA margins" for Hyosung and HHI.1728 
The United States does not deny that the all oth ers rate was based on the rate calculated by the 
USDOC in respect of HHI and Hyosung. Rather, the United States argues that in a situation where 
all margins are excluded, as was the case in LPT POR4 proceedings, no ceiling for the "all others" 
rate can be calculated pursuant to Article  9.4 and hence the provision becomes "inoperative".1729  
We note that although Article  9.4 prohibits the use of certain margins in the calculation of 
the ceiling for the "all others" rate, "it does not expressly address the issu e of how that ceiling should 
be calculated in the event that all margins are to be excluded from the calculation, under the 
prohibitions".1730 However, nothing in the text of Article  9.4 indicates that the provision ceases to 
be applicable in a situation whe re all rates established by the investigating authority are either zero, 
de minimis , or based on facts available. In the absence of such a limitation in the text of Article  9.4, 
 
1720 Appellate Body Report, US – Hot-Rolled Steel , para. 115.  
1721 Appellate Body Report, US – Hot-Rolled Steel , para. 115.  
1722 Appellate Body Report, US – Hot-Rolled Steel , para. 115.  
1723 Appellate Body Report, US – Hot-Rolled Steel , para. 116.  
1724 Appellate Body Report, US – Hot-Rolled Steel , para. 116.  
1725 Appellate Body Report, US – Zeroing (EC) (Article 21.5 – EC), para. 451.  
1726 Appellate Body Report, US – Hot-Rolled Steel , para. 123.  
1727 LPT POR4 decision memorandum (PDM), (Exhibit KOR -140), p. 19.  
1728 LPT POR4 issues and decision memorandum, (Exhibit KOR -211), pp. 35 and 3.  
1729 United States' opening statement at the first meeting of the  Panel, paras. 56 -57. 
1730 Appellate Body Report, US – Hot-Rolled Steel , para. 126. (emphasis original)  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  Article  3.2 of the DSU prevents us from "add[ing] to or diminish[ing] the righ ts and obligations 
provided in the covered agreements". We therefore disagree with the United States that Article  9.4 
of the Anti -Dumping Agreement is "inoperative" in light of the facts and circumstances of the present 
case.1731  
We also note the United States' argument that Korea 's claim fails because "Korea has not 
even alleged what the cap was" in the determination at issue.1732 Nothing in the record suggests 
that the USDOC calculated a ceiling for the "all others" rate separately from the "all ot hers" rate 
of 60.81 percent assigned to Iljin, Iljin Electric, and LSIS. Rather, we consider that the determination 
of the ceiling for the "all others" rate was implicit in the USDOC 's determination of the "all others" 
rate to be applied.1733 The issue befor e us is not whether the USDOC improperly exceeded the ceiling 
for the "all others" rate inconsistently with subparagraph (i) of Article  9.4, but, instead, whether the 
USDOC 's determination of the ceiling for the "all others" rate is consistent with the pro viso to 
Article  9.4 of the Anti -Dumping Agreement.  
We also reject the United States argument that Korea has failed to make a prima facie case 
because it has not "proposed any alternative methodology for calculating the cap in Article  9.4".1734 
We note Korea 's express suggestion that "alternative reasonable m ethodologies were available to 
the USDOC such as relying on the margins assigned to these producers in prior reviews".1735 
The United States does not respond to Korea 's proposed alternative methodology.  
Article  9.4 requires investigating authorities to "disr egard for the purpose of this 
paragraph  … margins established under the circumstances referred to in paragraph 8 of Article  6". 
Having rejected the United States' arguments above, we find the USDOC acted inconsistently with 
Article  9.4 of the Anti -Dumping Agreement because the USDOC determined the ceiling for the 
"all others" rate in respect of Iljin, Iljin Electric, and LSIS based on "the average of two AFA margins" 
for HHI and Hyosung"1736, i.e. "margins established under the circumstances referred to in 
paragraph  8 of Article  6" of the Anti -Dumping Agreement . 
Korea 's claims under Articles  1, 9.3, and 18.1 of the Anti -Dumping  Agreement  
Korea further claims that, in the LPT AD investigation, the USDOC 's use of facts 
available  inconsistently with Article  6.8 a nd Annex  II of the Anti -Dumping  Agreement  "led to an 
anti-dumping duty that was imposed and collected in excess of the margins of dumping in violation 
of Articles  1, 9.3, and 18.1 of the Anti -Dumping  Agreement ".1737 According to Korea, because the 
margin of dumping was determined based on facts available in a manner inconsistent with Article  6.8 
and Annex  II, "the imposition of duties at the level of the margin of dumping automatically violated 
Article  9.3".1738 Moreov er, Korea asserts that the violation of Article  6.8 and Annex  II also 
"automatically leads" to a violation of Articles  1 and 18.1 of the Anti -Dumping  Agreement , as "this 
USDOC investigation and the measure taken were not in accordance with the 
Anti-Dumping  Agreement ".1739  
The United  States  responds that Korea 's claims under Articles  1, 9.3 , and 18.1 are "entirely 
consequential" and "Korea offers no argument or evidence to support any independent breach of 
those provisions".1740 According to the United  States , were the Panel to uphold Korea 's claims under 
Article  6.8 and Annex  II, "there would be no basis to decide Korea 's consequential claims".1741 
 
1731 See also Panel Report, US – Supercalendered Paper , para. 7.267.  
1732 United States' opening statement at the first meeting of the Panel, para.  55. 
1733 By find ing the "all others" rate to be 60.81%, the USDOC impliedly found that the ceiling for the "all 
others" rate is equal to or greater than 60.81%. (Panel Report, US – Shrimp (Viet Nam) , fn 279. See also 
Panel Report, Canada – Welded Pipe , para. 7.32).  
1734 United States' opening statement at the first meeting of the Panel, para. 58.  
1735 Korea's  first written submission, para. 871. We also note that, before the USDOC, Iljin stated that 
the USDOC "has information on the record of this review, and past reviews, conce rning dumping rates 
calculated in prior reviews; however, [the USDOC] continues to use the six -year-old petition rate from the 
investigation as the AFA rate". (LPT POR4 issues and decision memorandum, (Exhibit KOR -211), p. 35).  
1736 LPT POR4 issues and decis ion memorandum, (Exhibit KOR -211), pp.  3 and 35.  
1737 Korea's  first written submission, para.  875. 
1738 Korea's  first written submission, para.  873. 
1739 Korea's  first written submission, para.  874. 
1740 United  States'  first written submission, para.  356. 
1741 United  States' first written submission, para.  358. WT/DS539/ R 
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  First, the United  States  "does not concede that such breaches are 'automatic'".1742 Second, the 
United  States  submits that deciding such claims would be serve "no useful purpose" , and would 
provide no "additional guidance that would be useful regarding implementation of any 
recommendations adopted by the DSB".1743 
Korea does not present any independent bases for the alleged  breaches of Articles  1, 9.3, 
and 18.1 of the Anti -Dumping  Agreement ; instead, its claims under these provisions  are dependent 
entirely upon a finding that the United  States  acted inconsistently with Article  6.8 and Annex  II of 
the Anti -Dumping  Agreement .1744 In these circumstances – and having already found that the 
United  States  acted inconsistently with Article  6.8 and certain provisions  of Annex  II – we do not 
consider it necessary to rule upon Korea 's claims under Articles  1, 9.3, and 18.1 in  order to resolve 
the dispute before us.1745 
7.4  Korea 's "as such" claim  
7.4.1   Preliminary ruling  
Korea challenges "as such" an unwritten measure allegedly adopted by the United  States  
(the "alleged unwritten measure"). On 23 April 2019, the United  States  requested a preliminary 
ruling that this claim was outside the Panel 's terms of reference because Korea had failed to "identify 
the specific measure[] at issue", as required by Article  6.2 of the DSU.1746 The Panel issued its 
preliminary ruling on 2  July 2019 – before t he first substantive meeting with the parties – and 
decided to provide the reasoning underlying its ruling as part of its Interim Report in accordance 
with paragraph  4.1(c) of the Working Procedures.1747 The preliminary ruling and the underlying 
reasons are presented together below.  
The Panel 's preliminary ruling was as follows:  
Having carefully considered the arguments of the Parties and the Third Parties, the Panel 
declines to rule that Korea 's "as such " claim concerning the alleged unwritten measure 
is outside its terms of reference. Rather, the Panel finds that, for purposes of Article  6.2 
of the DSU, the alleged unwritten measure that is the object of Korea 's "as such" 
challenge is properly identified  in Section  I.C of the Panel Request as follows:  
C. Use of Adverse Facts Available As Ongoing Conduct, or a Rule 
or Norm of General and Prospective Application  
This request also concerns the ongoing conduct or the practice of the 
USDOC of using "adverse facts available" as a rule or norm of general and 
prospective application when a producer or exporter is found to have failed 
to cooperate by not acting to the best of its ability. Under this ongoing 
conduct or norm, whenever the USDOC makes a fin ding that a producer or 
exporter has failed to cooperate by not acting to the best of its ability, it 
adopts adverse inferences and, in determining the duty rate for this 
producer or exporter, selects facts from the record that are adverse to the 
interests  of this producer or exporter without establishing (i ) that such 
inferences can reasonably be drawn in light of the degree of cooperation 
received, and (ii ) that such facts are the "best information available"  in the 
particular circumstances.[1]1748 
1 The us e of adverse facts available has been consistently applied by the USDOC and 
is undertaken pursuant to : (i) Section 502 of the Trade Preferences Extension Act 
 
1742 United  States'  first written submission, para.  358. 
1743 United  States'  first written submission, paras.  358-359. 
1744 Korea's  first written submission, paras.  873-874. 
1745 See, e.g. Panel Reports, US – Differential Pric ing Methodology , paras.  7.114 -7.115; Argentina – 
Poultry Anti -Dumping Duties , para.  7.369; US – Steel Plate , para.  7.103; and EU – Footwear (China) , 
para. 7.935.  
1746 See section  1.3.3 above.  
1747 Panel's  preliminary ruling, para.  1.2. 
1748 Korea's  panel request, para.  9 and fn 1.  WT/DS539/ R 
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  of 2015, Pub. L. No. 114 -27; (ii ) Section 776 of the Tariff Act of 1930, codified 
at 19 U.S.C. § 1 677e; and (iii ) the implementing regulations of the USDOC in 
19 C.F.R.  § 351, including in particular section  308. 
It is also evidenced, for example, by the manner in which  facts available was used 
in the measures identified in Section I.A of this Request. A preliminary and 
non-exhaustive list of measures confirming the existence of this ongoing conduct or 
rule or norm of applying adverse facts available whenever a finding i s made that a 
producer or exporter has failed to act to the best of its ability is attached as Annex  I 
to illustrate the practice.  
The above preliminary ruling by the Panel is limited to the issue of its jurisdiction and 
is without prejudice to any substan tive arguments concerning the existence or the 
precise content of the measure at issue that may be raised by the parties or third parties 
during the course of these proceedings.   
We now provide the reasons underlying this preliminary ruling.  
In its prelimi nary ruling request of 23 April 2019, the United  States  asserts that Korea 's "as 
such" claim against an alleged unwritten measure is outside the Panel 's jurisdiction because, while 
being directed at a "single unwritten measure", Korea 's panel request conta ins "multiple inconsistent 
descriptions" of such an alleged unwritten measure.1749 Moreover, according to the United  States , 
the deficiency found in the Korea 's panel request is "confirm[ed]" and "compound[ed]" in its 
first written submission, wherein Korea "switches between multiple different descriptions of the 
'precise content ' of the alleged unwritten measure" .1750 Having identified at least three such allegedly 
inconsistent descriptions in the panel request1751, the United  States  contends that Korea fails to  
identify a "specific unwritten measure at issue", in accordance with Article  6.2 of the DSU.1752 
Korea responds that the United  States'  preliminary ruling request is "entirely unfounded" 
and should be rejected by the Panel.1753 According to Korea, in accordance with Article  6.2 of 
the DSU, the panel request properly identifies in section  I the measures at issue, and provides a 
brief summary of the legal basis of the complaint in section  II. Korea therefore considers unavailing 
the United  States'  identification of multiple allegedly conflicting descriptions from section  II of its 
panel request, which "simply elaborate on the problematic aspects of the measure in order to provide 
the required brief summary of the legal basis, witho ut however affecting the identification of the 
measure".1754 In Korea 's view, therefore, the United  States  improperly conflates the identification of 
the measure at issue in section  I with the brief explanation of the legal basis in section  II of its panel 
request.1755  
We first summarize the relevant aspects of the legal standard under Article  6.2 of the DSU 
(section  7.4.1.1 ) and then examine whether Kore a's panel request is consistent with that legal 
standard ( section  7.4.1.2 ). 
 
1749 United  States'  request for a preliminary ruling, para.  2.  
1750 United  States'  s request for a preliminary ruling, para.  3. 
1751 United  States'  request for a preliminary ruling, paras.  10-12 (quoting Korea's  panel request, 
paras.  9 and 33 -34).  
1752 United  States'  request for a preliminary ruling, para.  4.  
1753 Korea's  response to United  States'  request for a preliminary ruling, paras.  4 and 28.  
1754 Korea's  response to United  States'  request for a preliminary ruling, para.  33.  
1755 Korea's  response to United  States'  request for a preliminary ruling, para.  33. Korea also takes issue 
with the United  States'  assertion that the so -called "different descriptions" of the measure are "conflicting" or 
"inconsistent", arguing instead that, the "different descriptions", which are t o be found only in section  II of the 
panel request, merely refer to different aspects of the same unwritten measure that are deemed problematic in 
light of the relevant requirements under the Anti -Dumping  Agreement and the SCM  Agreement. 
(Korea's  response to United  States'  request for a preliminary ruling, para.  42 (referring to 
United  States'  request for a preliminary ruling, para.  2)). Furthermore, Korea considers the 
United  States'  focus on the first written submission when examining the panel request to  be "entirely 
misplaced" as the sufficiency of a panel request under Article  6.2 is to be determined on its face and not by 
reference to subsequent submissions. (Korea's  response to United  States'  request for a preliminary ruling, 
para. 35). WT/DS539/ R 
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Article  6.2 of the DSU  
Article  6.2 of the DSU, entitled "Establishment of Panels", sets out the relevant requirements 
for panel requests in WTO dispute settlement proceedings and reads, in relevant part, as follows:  
The request for the establishment of a panel shall be made in writing. It shall indicate 
whether consultations were held, i dentify the specific measures at issue and provide a 
brief summary of the legal basis of the complaint sufficient to present the problem 
clearly.  
Besides requiring that panel requests shall be made in writing and must indicate whether 
consultations were held, Article  6.2 of the DSU sets out two additional and distinct requirements for 
a complainant : first, to "identify the specific measures at issue "; and second, to "provide a brief 
summary of the legal basis of the complaint sufficient to present the problem clearly".1756  
The "specific measure" to be identified in a panel request is the "object of the challenge", 
i.e. the measure that is alleged to b e causing the violation of an obligation contained in a 
covered  agreement .1757 The specific measure at issue defines what is being challenged by a 
complainant. By contrast, the legal basis of the complaint, i.e. the "claim", pertains to the specific 
provisio n of the covered agreement  that contains the obligation alleged to be infringed.1758 
Article  6.2 requires that the panel request set out "a brief summary" of the legal basis of the 
complaint that is "sufficient to present the problem clearly". In order to co mply with this requirement, 
a panel request must "plainly connect" the challenged measure(s ) with the provision(s ) of the 
covered agreement s that are alleged to have been violated.1759  
Taken together, these two aspects – the "specific measures at issue" and  "a brief summary 
of the legal basis of the complaint" – constitute the "matter referred to the DSB", which normally 
forms the basis of a panel 's terms of reference under Article  7.1 of the DSU.1760 In this manner, a 
panel request serves to define a panel 's terms of reference and to delimit the scope of its 
jurisdiction.1761 The requirements under Article  6.2 of the DSU are , therefore , "central" to the proper 
establishment of a panel 's jurisdiction.1762  
Given the fundamentally important role that a panel request plays in delimiting the 
jurisdiction of a panel from the outset of the proceedings, panels must, for purposes of Article  6.2, 
carefully scrutinize the specific panel request at issue, read as a wh ole, and on the basis of the 
precise text contained in that request.1763 Moreover, compliance with the requirements of Article  6.2 
must be assessed on the "face" of the panel request, as it existed at the time of filing.1764 
The examination under Article  6.2 e nvisages a limited of role for the parties ' submissions that are 
made after the filing of the panel request. Such subsequent submissions cannot "cure" any existing 
defects in a panel request, and may only be consulted to the extent that they "confirm" or " clarify" 
the meaning of the text used in the panel request.1765 
 
1756 Appellate  Body Reports, Argentina – Import Measures , para.  5.39. 
1757 Appellate  Body Report, EC – Selected Customs Matters , para.  130.  
1758 Appellate  Body Report, EC – Selected Customs Matters , para.  130. 
1759 Appellate  Body Report, Korea – Pneumatic Valves (Japan) , paras.  5.6-5.7. See also Appellate  Body 
Reports, China – Raw Materials , para.  220; and China – HP-SSST (Japan)  / China – HP-SSST (EU) , para.  5.12. 
1760 Appellate  Body Reports, US – Countervailing and Anti -Dumping Measures (China) , para.  4.6; 
Argentina – Import Measure s, para.  5.39. 
1761 Appellate  Body Reports, Korea – Pneumatic Valves (Japan) , para.  5.4; China – HP-SSST (Japan)  / 
China – HP-SSST (EU) , para.  5.12. By defining the jurisdiction of the panel, the panel request also fulfils the 
due process objective of providi ng the respondent and third parties with notice regarding the essential nature 
of the complainant's  case. This "due process objective is not constitutive of, but rather follows from, the proper 
establishment of a panel's  jurisdiction". (Appellate  Body Repo rt, EC and certain member States – Large Civil 
Aircraft , para. 640. See also Appellate  Body Reports, Korea – Pneumatic Valves (Japan) , para.  5.4; and US – 
Countervailing and Anti -Dumping Measures (China) , para.  4.7).  
1762 Appellate  Body Report, Korea – Pneum atic Valves (Japan) , para.  5.8. 
1763 See, e.g. Appellate  Body Report, Russia – Railway Equipment , para.  5.29. 
1764 See, e.g. Appellate  Body Reports, Russia – Railway Equipment , para.  5.29; and Indonesia – Iron or 
Steel Products , para.  5.79. 
1765 See, e.g. Appellate  Body Reports, Russia – Railway Equipment , para.  5.29; and Indonesia – Iron or 
Steel Products , para.  5.79. WT/DS539/ R 
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Whether Korea 's panel request is consistent with Article  6.2 of the DSU  
The United  States  asserts that Korea 's "as such" claim is outside the Panel 's jurisdiction 
because the panel request conta ins "multiple inconsistent descriptions" of the alleged unwritten 
measure that is challenged  by Korea .1766 Having identified at least three such allegedly inconsistent 
descriptions in the panel request1767, the United  States  submits that Article  6.2 of the DSU  "does not 
allow for this level of uncertainty".1768 The United  States  also alleges that Korea 's first written 
submission confirms that its panel request does not adequately identify the alleged unwritten 
measure and, instead, compounds the deficiency.1769 
We note that the introduction of the panel request explains that, "[p]ursuant to Article  6.2 
of the DSU, Korea proceeds below to identify the specific measures at issue and to provide a brief 
summary of the legal basis of the complaint".1770 Consistent with thi s introduction,  the panel request 
then sets out two parts entitled "Identification of the Measures" and "Legal Basis", respectively.  
Part I of the panel request, entitled "Identification of the Measures", is divided into 
three  sections that identify three categories of measures, namely :  
A. "Certain Definitive Anti -Dumping and Countervailing Duty Measures"1771;  
B. "Section 776 of the Tariff Act of 1930 (19 U.S.C. §1677e as amended by Section 502 of the 
Trade Preferences Extension Act of 2015, and its implementing regulations"1772; and  
C. "Use of Adverse Facts Available As Ongoing Conduct, or a Rule or Norm of General and 
Prospective Application" .1773 
The description of the alleged unwritten measure in Section I.C  – set out in paragraph  7.586  
above – is the only description of that measure set out in Part I of Korea's panel request.  
Part II of the panel request, entitled "Legal Basis", is divided into three sections that set out 
the "legal basis" for the claims corresponding to each of the categories of measures identified in 
Part I, namely :  
A. "As Applied Challenge to Certain Definitive Anti -Dumping and Countervailing Duty 
Measures"1774;  
B. "As Such Challenge to Section 776 of the Tariff Act of 1930 (19 U.S.C. § 1677e ) as amended 
by Section 502 of the Trade Preferences Extension Act of 2015, and its implemen ting 
regulations"1775; and  
C. "As such Challenge to the USDOC 's Use of Adverse Facts Available As an Ongoing Conduct or 
Rule or Norm of General and Prospective Application".1776  
Section II.C sets out multiple allegations as to why the alleged unwritten measu re is 
inconsistent with the United  States'  obligations under the covered agreement s. 
We disagree with the United  States  that Korea 's panel request contains "multiple 
inconsistent descriptions" of the alleged unwritten measure at issue. Part I is aimed expr essly at 
identifying the specific measures at issue and contains one description of the alleged unwritten 
 
1766 United  States'  request for a preliminary ruling, para.  2. 
1767 United  States'  request for a preliminary ruling, paras.  10-12 (quot ing Korea's  panel request, 
paras.  9 and 33 -34). 
1768 United  States'  request for a preliminary ruling, para.  13. 
1769 United  States'  request for a preliminary ruling, para.  14. 
1770 Korea's  panel request, para.  4. 
1771 Korea's  panel request, section  I.A. 
1772 Korea's  panel request, section  I.B. 
1773 Korea's  panel request, section  I.C.  
1774 Korea's  panel request, section  II.A. 
1775 Korea's  panel request, section  II.B. 
1776 Korea's  panel request, section  II.C. WT/DS539/ R 
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  measure being challenged. Part II of the panel request sets out a brief summary of the legal basis 
for each challenge. In doing so, Section  II.C also refers  to the alleged unwritten measure identified 
in Section  I.C by using slightly different explanations, including  the two allegedly "conflicting" 
descriptions identified by the United  States  as the primary basis for its jurisdictional challenge.1777  
Article 6.2 treats measures  and claims  as distinct and sets out separate requirements that 
must each be satisfied in a panel request in order for a "matter" to be within a panel 's terms of 
reference.1778 In our view, the structure of Korea 's panel request clearly reflects this distinction 
between the specific measures at issue, which are identified in Part I, and the corresponding claims 
of WTO -inconsistency, which are set out in Part II.1779  
It is the des cription of the alleged unwritten measure in Part I, and not the formulations 
used by Korea as part of describing its claims in Part II, that ought to be tested against the 
requirement under Article  6.2 of the DSU to identify the "specific" measure at issu e. In this regard,  
we note  that the United  States  does not argue that the description of the alleged unwritten measure 
contained in Section  I.C of the panel  request is, in and of itself , deficient, or otherwise lacks the 
requisite degree of specificity und er Article  6.2 of the DSU. For jurisdictional purposes under 
Article  6.2 of the DSU, we find that Section  I.C of Korea 's panel request properly identifies the 
alleged unwritten measure.1780 In light of this finding, we see no reason to consult Korea 's first 
written submission  – as urged by the United  States – for purposes of our preliminary ruling.  
Conclusion  
Our assessment  – based upon an objective examination of the precise text and the overall 
structure of Korea 's panel request at the time it was filed – leads us to conclude that, for purposes 
of Article  6.2 of the DSU, the alleged unwritten measure that is the object of Korea 's "as such" 
challenge is identified properly in Section  I.C of its panel request.   
Our preliminary ruling remains limited t o the issue of our jurisdiction and is without prejudice 
to any substantive arguments concerning the existence or the precise content of the alleged 
unwritten measure that may be raised by the parties during the course of these proceedings.1781 
We address th ese issues below . 
7.4.2   "As such" claim against the alleged unwritten measure  
Korea challenges, on an "as such" basis, the USDOC 's use of "adverse facts available" as an 
unwritten measure (the "AFA measure" or the "alleged unwritten measure"). Arguing that the 
measure is a "rule or norm of general and prospective application"1782 or, in the alternative, 
constitutes "ongoing conduct"1783, Korea offers several pieces of evidence – including provisions of 
US domestic law, the USDOC Anti -Dumping Manual, US domestic court rulings, and USDOC 
determinations – to establish its existence.1784 According to Korea, the AFA rule or norm, or, in the 
 
1777 United  States'  request for a preliminary ruling, paras.  10-12. 
1778 Appellate  Body Report, Australia – Apples , para.  421. See also Appellate  Body Report, EC – Selected 
Customs Matters , para.  131. 
1779 Korea's  panel request, para.  4. ("Pursuant to Article  6.2 of  the DSU , Korea proceeds below to 
identify the specific measures at issue and to provide a brief summary of the legal basis of the complaint" 
(emphasis added)). We note Canada's  statement that it is "reasonable to assume that a description of how the 
measu re allegedly violates the covered agreements would involve different wording and more detail than the 
mere identification of the measure". (Canada's  third-party submission, para. 33).  
1780 We are mindful, in this regard, that a complaining Member enjoys a "ce rtain discretion" in the 
identification of the specific measure at issue and, "[a]s long as the specificity requirements of Article  6.2 are 
met, [there is] no reason why a Member should be precluded from setting out in a panel request 'any act or 
omission'  attributable to another Member as the measure at issue". (Appellate  Body Report, Australia – Apples , 
para. 423 (quoting Appellate  Body Report, EC – Selected Customs Matters , paras.  133 and 149)).  
1781 Panel's  preliminary ruling, para.  2.2. See also Appellat e Body Report, US – Continued Zeroing , 
para. 169 (noting that "the identification  of the specific measures at issue, pursuant to Article  6.2, is different 
from a demonstration of the existence  of such measures" (emphasis added)).  
1782 See section  7.4.5 below.  
1783 See section  7.4.6 below.  
1784 Korea's  response to Panel question No.  104, para.  143. WT/DS539/ R 
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  alternative, the AFA "ongoing conduct", is inconsistent with the United  States'  obligations under 
Article  6.8 and Annex  II of the Anti -Dumping  Agreement  and Article  12.7 of the SCM  Agreement .1785  
From the outset of the proceedings1786, the United  States  maintains that Korea has failed to 
establish the existence of the alleged unwritten measure. According to the United  States , such failure 
results from the lack of "clarity" in Korea 's identification of the measure1787, as well as its flawed 
attempts at esta blishing the various elements of the alleged measure, including its precise 
content.1788 For the United  States , the possibility of "ongoing conduct" constituting a measure "is 
ultimately moot in the context of this dispute", because Korea, in attempting to p rove the existence 
of "ongoing conduct", has not identified any elements different from those necessary to prove the 
existence of a "rule or norm". Therefore, if Korea fails to prove the latter, its alternative also fails.1789 
We first examine how Korea iden tifies the alleged unwritten measure and describes its 
precise content. Next, we address Korea 's reliance upon prior WTO disputes involving allegedly 
similar measures.  We then review the arguments and evidence to determine whether Korea has 
established tha t the unwritten measure with the precise content alleged by it, in fact, exists and, if 
it does, whether that measure is "as such" inconsistent with the covered agreement s.  
7.4.3   The measure at issue  
Introduction  
An "as such" challenge can, in principle, be bro ught against a measure that is not expressed 
in the form of a written document under both the Anti -Dumping  Agreement  and the 
SCM Agreement .1790 That said, when a challenge is brought against a measure that is not expressed 
in written form, the very existence  of the challenged measure may be uncertain1791 – as is the 
United  States'  position in the present proceedings. "As such" challenges are "serious challenges" and 
their implications "are obviously more far -reaching than 'as applied ' claims" , as they seek to p revent 
Members ex ante from engaging in certain conduct.1792  
Panels are well advised to " not lightly assume  the existence of a 'rule or norm ' constituting 
a measure of general and prospective application, especially when it is not expressed in the form of 
a written document" .1793 Instead, in order to make an "objective assessment" under Article  11 of 
the DSU, " [p]articular rigour  is required on the part of a panel to support a conclusion as to the 
existence of a 'rule or norm ' that is not expressed in the for m of a written document" .1794 
In particular, a panel "must carefully examine the concrete instrumentalities that evidence the 
existence of the purported 'rule or norm ' in order to conclude that such 'rule or norm ' can be 
challenged, as such" .1795 This does not , however, mean "that a mere abstract principle  would qualify 
as a 'rule or norm ' that can be challenged, as such".1796  
We note that the "specific measure at issue, whether it is written or unwritten, and how it is 
described, characterized, and challenged  by a complainant ", are important aspects that "inform the 
 
1785 Korea's  first written submission, para.  1035; panel request, para.  34. See also Korea's  response to 
Panel question No.  105, paras.  144 and 146.  
1786 United  States'  request for a preliminary ruling, par as. 18-23. 
1787 United  States'  first written submission, para.  432 ("Korea's  failure to identify a specific measure with 
even any level of clarity … also makes it impossible to identify precisely which additional elements Korea would 
need to prove.")  
1788 United  States'  first written submission, paras.  439-467. 
1789 United  States'  first written submission, para.  436. 
1790 Appellate  Body Report, US – Zeroing (EC) , para.  193. 
1791 Appellate  Body Report, US – Zeroing (EC) , para.  197. 
1792 Appellate  Body Report, US – Oil Country  Tubular Goods Sunset Reviews , para.  172. 
1793 Appellate  Body Report, US – Zeroing (EC) , para.  196. (emphasis added)  
1794 Appellate  Body Report, US – Zeroing (EC) , para.  198. (original emphasis omitted; emphasis added)  
1795 Appellate  Body Report, US – Zeroing (EC) , para. 198.  
1796 Appellate  Body Report, US – Zeroing (EC) , fn 342. (emphasis added)  WT/DS539/ R 
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  kind of evidence a complainant is required to submit and the elements that it must prove in order 
to establish the existence of the measure challenged".1797  
Mindful of the seriousness of "as such" cla ims and the uncertainty inherent in challenges 
against unwritten measures, we begin by examining how Korea  – as the complainant – identifies 
and describes the alleged unwritten measure challenged in these proceedings.  
The precise content of the alleged unw ritten measure  
Korea 's panel request identifies the alleged unwritten measure as set out in paragraph  7.586  
above.  It contains two sentences and a footnote. Given the terms of the panel request , as confirmed 
by our preliminary ruling, this is the only alleged unwritten measure that is within the Pan el's terms 
of reference.   
Korea explains that the description in the panel request "involves several interlinked aspects 
of the measure, which together form the single measure challenged" .1798 According to 
Korea 's description, the first aspect of the measure  is that it applies "whenever the USDOC makes 
a finding that a producer or exporter has failed to cooperate by not acting to the best of its 
ability".1799 Korea explains that its "challenge focuses on the selection of the facts available in a 
situation where a finding of non -cooperation has been made".1800 According to Korea, its "'as 
such' claim is agnostic  about the justified nature or not of the finding of  non-cooperation by the 
USDOC in these cases".1801 We agree with Korea that one of the "interlinked aspects" of the measure 
is the USDOC 's finding of non -cooperation that serves as the "trigger"1802 and delimits the universe 
within which the alleged unwritten measure applies.  
The next aspect of Korea 's description relates to the "consequence" that follows the 
"trigger".1803 According to Korea 's description, the USDOC "adopts adverse inferences" whenever it 
makes a finding of non -cooperation.1804 Korea explains that "the term 'adverse inferences' does not 
actually cover the use of AFA as it suggests that the USDOC draws certain inferences from the 
relevant factual circumstances of each proceeding when assessing the totality of the fact[s] and 
evidence be fore it" .1805 Rather, Korea explains that an "adverse inference" means that "the duty will 
be determined based on facts that are adverse to the interests of the party concerned" .1806  
The third aspect of the measure relates to the selection of the particular f acts available due 
to the adoption of adverse inferences. According to Korea 's description, "in determining the duty 
rate for this producer or exporter, [the USDOC] selects facts from the record that are adverse to the 
interests of this producer or exporte r".1807 In its first written submission, Korea explains that the 
USDOC "selects from among the facts available those facts that would lead to a result that would 
certainly be not more favorable than that where the foreign producer or exporter in question had  
cooperated fully".1808  
Korea explains that the "precise content" of what it means to apply "adverse facts available" 
or adopt "adverse inferences" is "foreshadowed" in the remainder of the description in its panel 
request, which "gives meaning and color to  the label AFA".1809 According to this description in the 
second sentence of paragraph  9 of Korea 's panel request, as part of the measure, the USDOC does 
not establish "(i ) that such inferences can reasonably be drawn in light of the degree of cooperation 
received, and (ii ) that such facts are the 'best information available ' in the particular 
 
1797 Appellate  Body Report, US – Anti-Dumping Methodologies (China) , para.  5.123 (referring to 
Appellate  Body Reports, Argentina – Import Measures , paras.  5.108 and 5.110 (empha sis added)); see also 
Appellate  Body Report, US – Supercalendered Paper , fn 65. 
1798 Korea's  response to preliminary ruling request, para.  31. 
1799 Korea's  panel request, para.  9. 
1800 Korea's  response to Panel question No.  43. 
1801 Korea's  response to Panel question No. 40(b). (emphasis added)  
1802 Korea's  response to United  States'  preliminary ruling request, para.  31. 
1803 Korea's  response to United  States'  preliminary ruling request, para.  31. 
1804 Korea's  panel request, para.  9. 
1805 Korea's  response to Panel question No.  43.  
1806 Korea's  response to Panel question No.  104, para.  139.  
1807 Korea's  panel request, para.  9. 
1808 Korea's  first written submission, para.  923. 
1809 Korea's  response to Panel question No.  104, paras.  133 and 139.  WT/DS539/ R 
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  circumstances" .1810 We understand "such inferences" to be the "adverse inferences" that comprise 
the second aspect of the measure. Similarly, "such facts" are the adverse  facts available that are 
selected as part of the third aspect of the measure. Consequently, we agree with Korea that the 
description in the panel request defines the measure by reference to both what the USDOC does  do 
(i.e. the first, second, and third as pects), as well as what the USDOC does not do (i.e. the precise 
meaning of the second and the third aspects ).1811 These positive and negative aspects of the 
USDOC 's conduct are important elements of the precise content of Korea 's alleged unwritten 
measure.  
Neither the term "adverse inferences" nor  the term  "adverse facts available" is defined in 
Article  6.8 and Annex  II of the Anti -Dumping  Agreement  and Article  12.7 of the SCM  Agreement .1812 
We therefore  consider important Korea 's explanation that the second sentence of paragraph  9 of its 
panel request describes "the precise content of the AFA Norm and salient aspects of what the label 
'AFA' means".1813 Insofar as it explains and clarifies Korea 's use of the terms "adverse facts 
available" and "adverse inferences", the additional "meaning" or "colour" imparted by the remainder 
of Korea 's description is a crucial and important feature of the precise content of the unwritten 
measure alleged to exist.1814 In this sense, we agree with the United States  that "Korea 's panel 
request cannot be read as challenging the use of adverse inferences broadly".1815 
As to the linkage between the different aspects of the alleged unwritten measure, Korea 
explains that, "whenever  the USDOC makes a determination  that an interested party has failed to 
cooperate to the best of its abilities, it automatically  resorts to the use of AFA" .1816 In response to 
questioning by the Panel at the first substantive meeting, Korea similarly refers to the " automatic 
relationship  between a finding of non -cooperation and the use of AFA".1817 As part of its 
 
1810 Korea's panel request, para.  9. 
1811 Korea's  response to Panel question No.  104, para.  140.  
1812 Annex  V of the SCM  Agreement contains a reference to the drawing of "adverse inferences" by a 
panel in cases concerning "serious prejudice".  
1813 Korea's  response to Pan el question No.  104, para.  139. 
1814 We note Korea's  argument that, "[i]n light of recent case law clarifying the limited obligation of a 
complainant, Korea could actually have stopped with the description in the first sentence [of paragraph  9 of its 
panel request] that plainly connects the measure with the provision of the covered  Agreements claimed to 
have been infringed, and foregone the additional coloring in the second sentence as complainants". 
(Korea's  response to Panel question No.  104, para.  141). We disagree with Korea that the firs t sentence of 
paragraph  9 serves to "plainly connect the measure with the provision of the covered  Agreement claimed to 
have been infringed". As Korea acknowledges, and as found by the Panel in its preliminary ruling, paragraph  9 
of Korea's  panel request, in its entirety, identifies the specific unwritten measure at issue, while section  II.C of 
Korea's  panel request sets out the legal basis of the complaint by "plainly connecting" the unwritten measure 
to the treaty provisions alleged to be infringed. Furth ermore, as Korea notes, the second sentence of 
paragraph  9 of its panel request describes "the precise content of the AFA Norm and salient aspects of what 
the label 'AFA'  means". The "precise content" and "meaning" of "AFA" provided by Korea – the complain ant – 
are important because the measure challenged is unwritten and because the term "AFA" is not defined under 
the covered agreements. (See Panel's  preliminary ruling, para.  2.1; Korea's  response to 
United  States'  preliminary ruling request, para.  33 (sta ting that, "[i]n arguing that Korea's  panel request 
provides multiple descriptions of the identified 'as such'  measure, the United  States improperly compares the 
correct identification of the measure in Section I with the brief explanation of the legal bas is in Section II"); 
and Korea's  response to Panel question No.  104, para.  139).  
1815 United  States'  second written submission, para.  144. See also Appellate  Body Report, US – Zeroing 
(EC), fn 342 (expressing doubt "that a mere abstract principle  would qualify  as a 'rule or norm'  that can be 
challenged, as such" (emphasis added)). Given the manner in which Korea identifies its measure, the Panel is 
not called upon to address the extent to which inferences that happen to be "adverse" to the non -cooperating 
party are permissible under the covered  Agreements. We note, in this regard, arguments made by two of the 
third parties in this dispute. The European Union "agrees … that the use of adverse inferences is not 
necessarily inconsistent, in all circumstances, with Article  6.8 of the Anti -Dumping  Agreement and Article  12.7 
of the SCM  Agreement" and "that the use of adverse inferences … would be justified in cases of fraud or total 
lack of cooperation by the producer or exporter in question". (European Union's  third-party submission, 
para. 81). Pointing out that "Annex  II of the Anti -Dumping  Agreement contemplates the possibility that the use 
of facts available may result in a less favourable outcome for an interested party", Canada submits that this 
"d[oes] not preclu de the use of adverse inferences in all situations". (Canada's  third-party submission, 
para. 18).  
1816 Korea's response to Panel question No. 104, para. 128 (emphasis added). See also Korea's first 
written submission, para. 1034.  
1817 Korea's  response to Panel  question No.  45 (emphasis added). See also response to question No.  43 
("whenever it makes a finding of non -cooperation, that door closes and another door opens that is based on 
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  second  written submission, Korea explains that the USDOC applies "AFA … solely based on the 
finding that the party failed to cooperate to the best of its ability" and that the USDOC 's "selection 
of the facts available is based solely  on their adverse nature".1818 In a similar fashion, in response 
to questioning by the Panel at the second substantive meeting, Korea explains that "[t]he sole 
procedural circumstance of non -cooperation cannot be  the basis  for the selection of the information 
to replace the allegedly m issing information"1819 and that "the unwritten measure that Korea is 
challenging is the automatic link between a finding of non -cooperation and the application of 
AFA".1820 Korea therefore emphasizes the "automatic link" between the first aspect of the measur e 
(i.e. the finding of non -cooperation ) and the second and third aspects (i.e. the adoption of "adverse 
inferences " and the selection of "adverse facts available ").1821  
As discussed, the positive and negative aspects of Korea 's definition of "adverse inferences" 
and "adverse facts available", working together, constitute important features of the precise content 
of the alleged unwritten measure. Korea must demonstrate both these aspects in order to establish 
the "automatic link" between a find ing of non -cooperation and the USDOC 's use of "adverse 
inferences" or "adverse facts available" that it takes issue with. Showing merely that whenever the 
USDOC makes a finding of non -cooperation, it uses the labels of "adverse inference" or "adverse 
facts available" or selects those replacement facts that happen to be "adverse to the interests" of 
the non -cooperating party is not sufficient to establish the "automaticity" that Korea emphasizes. 
Rather, Korea must also demonstrate the negative aspect of the  USDOC 's conduct that forms an 
important feature of the alleged unwritten measure. This understanding of the positive and negative 
aspects of "adverse inferences" identified in Korea 's panel request is also confirmed by its 
subsequent statements and submis sions to the Panel.1822 
Based on the above, we understand the crux of Korea 's concern to be an alleged lack of 
evaluation by the USDOC between the finding of non -cooperation and the adoption of adverse 
inferences and the selection of adverse facts available.  The nature  and the extent  of the evaluation 
that is allegedly lacking in the unwritten measure is, however, not entirely clear to us  from Korea 's 
submissions . On the one hand, Korea 's repeated statements  in its submissions to the Panel that the 
selection of adverse facts available is "automatic" and based solely  on a finding of non -cooperation 
implies that the USDOC does not engage in any other evaluation. On the other hand, the negative 
aspects of the al leged unwritten measure identified in Korea 's panel request imply that the USDOC 
conducts an inadequate  evaluation, because it uses "adverse inferences" or "adverse facts available" 
without taking into account the "degree of cooperation" received and witho ut establishing that the 
replacement facts selected by it "are the 'best information available ' in the particular 
circumstances".1823 In its subsequent submissions, Korea also explains this as a failure to engage in 
a "comparative evaluation to arrive at an accurate determination"1824 and asserts that "[t]he AFA 
Rule or Norm, or the AFA Ongoing Conduct, does not " allow a proper drawing of inferences because 
it does not take "differences in the factual circumstances of the situation into account".1825 In other 
words, instead of claiming that the USDOC necessarily fails to engage in any other  evaluation after 
a finding of non -cooperation, Korea asserts that the USDOC does not engage in the kind of search 
 
finding facts that are sufficiently adverse to the interests of the intereste d party in question without any 
process  of reasoning or evaluation to determine whether these facts reasonably replace the missing 
information or lead to an accurate determination, and without consideration of the specific reasons that led to 
the finding o f non-cooperation" (emphasis added)).  
1818 Korea's  second written submission, paras.  409-410 (emphasis added). See also ibid.  
para. 412: "each time the USDOC found such non -cooperation, it automatically applied AFA without engaging 
in the required comparative  process of reasoning and evaluation to make an accurate determination"; and 
Korea's request for interim review, para. 69 ("[t]he use of AFA means that the sole procedural circumstance of 
non-cooperation is the basis for the selection of the facts availabl e that are adverse to the interest of the 
producer rather than the most accurate") . 
1819 Korea's  response to Panel question No.  50, para.  16. (emphasis added)  
1820 Korea's  response to Panel question No.  107, para.  155. (emphasis added)  
1821 We note that the term "w henever" – signifying the "automatic" link between a finding of 
non-cooperation and the consequences that follow – is found only in the second sentence of Korea's description 
of the alleged unwritten measure in paragraph 9 of its panel request, thereby und erscoring the importance of 
this sentence. (Korea's request for interim review, paras. 69 and 72 (quoting Korea's response to Panel 
question No. 104)).  
1822 See, e.g. Korea's  second written submission, para.  422; responses to Panel question Nos. 43 and 
104; a nd request for interim review, para. 69.  
1823 Korea's  panel request, para.  9.  
1824 Korea's  first written submission, para.  924.  
1825 Korea's  second written submission, para.  419. WT/DS539/ R 
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  for reasonable replacements for the missing information that i s required under the covered 
agreement s. Given the lack of clarity in Korea 's submissions on this issue, we address  both these 
different understandings as part of our analysis below.1826 
The legal characterization of the alleged unwritten measure  
Korea makes clear that it challenges the alleged unwritten measure on an "as such" basis.1827 
We agree that "the distinction between 'as such ' and 'as applied ' challenges neither governs the 
definition of a measure for purposes of WTO dispute settlement, nor defin es exhaustively the types 
of measures susceptible to challenge".1828 Nonetheless, we note that "this distinction serves as an 
analytical tool to facilitate the understanding of the nature of a measure at issue" .1829 In the case at 
hand, the fact that Korea cha racterizes its challenge as an "as such" claim helps us, at the very 
least, understand that it seeks to prevent the United  States  from "engaging in certain conduct in 
general and in the future, as opposed to addressing particular instances of application t hat are 
occurring or have occurred".1830  
Korea characterizes the unwritten measure in two alternative ways.  First, it argues that the 
measure is a "rule or norm of general and prospective application" (the "AFA rule or norm").1831 
In the event the Panel consi ders that "the use of AFA does not meet the criteria for being a rule or 
norm of general and prospective application", Korea claims that "it in any case constitutes a form of 
'ongoing conduct'" (the "AFA ongoing conduct").1832 Thus, Korea 's characterization of the alleged 
unwritten measure as ongoing conduct is presented only in the alternative to its arguments 
demonstrating the existence of a "rule or a norm" . We follow this order for purposes of our analysis , 
bearing in mind that, "[i]n every WTO dispute, a complainant must establish … the precise content  
of that challenged measure".1833 Thus, in whatever legal form it chooses to characterize the alleged 
unwritten measure, Korea bears the burden of establishing that the unwritten measure with the 
precise conte nt identified by it, in fact, exists.  
7.4.4   Korea 's reliance on prior WTO disputes  
A peculiar  feature of this dispute is the way in which Korea seeks to rely on 
dispute  settlement reports in three prior WTO disputes, namely US – Carbon Steel (India) , 
US – Anti-Dumping Methodologies (China) , and US – Supercalendered Paper. Korea asserts that 
"prior WTO panel and Appellate  Body findings have confirmed the existence of the United  States'  AFA 
Norm or similar AFA Ongoing Conduct".1834 Korea further submits that " [a] nu mber of relevant 
factual findings were made by the panels and the Appellate  Body in these disputes relating to the 
use of AFA by the United  States , which confirm the claims made by Korea about the use of AFA as 
a Norm or as a form of Ongoing Conduct" .1835 The United  States , for its part, asserts that any findings 
concerning "the existence of a measure with th[e] precise content" in these prior disputes "offer [] 
no support for the existence of the markedly different alleged measure in Korea 's panel request" .1836 
Korea submits that in US – Carbon Steel (India) , the Appellate  Body "implicitly acknowledged 
that there exists a practice of always using AFA in cases of non -cooperation".1837 Korea asserts that 
the Appellate  Body in that dispute made certain factual findin gs that "acknowledged that using 
AFA was a consistent 'practice ' of the USDOC".1838 Specifically, Korea refers to the 
 
1826 See paras. 7.682 -7.683 , 7.686 , and 7.697 -7.698  below.  
1827 Korea's  panel request, sections I.C and II.C.  
1828 Appellate  Body Report, US – Anti-Dumping Methodologies (China) , para.  5.124. See also 
Appellate  Body Reports, US – Continued Zeroing , para.  179; and Argentina – Import Measures , para.  5.102.  
1829 Appellate  Body Report, US – Anti-Dumping Methodologies (China) , para.  5.124.  
1830 Appellate  Body Report, US – Anti-Dumping Methodologies (China) , para.  5.127.  
1831 Korea's first written submission, paras.  878 and 895 -940. 
1832 Korea's  first written submission, paras.  941-960.  
1833 Appellate  Body Report, Argentina – Import Measures , para.  5.104. (emphasis added)  
1834 Korea's  first written submission, para.  879. 
1835 Korea's  first written submission, para.  962. 
1836 United  States'  second wr itten submission, para.  143. See also United States' first written 
submission, paras.  456 and 465.  
1837 Korea's  first written submission, para.  971 (quoting Appellate  Body Report, US – Carbon Steel 
(India) , fn 1181).  
1838 Korea's  first written submission, para.  969. WT/DS539/ R 
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  Appellate  Body's discussion of certain US domestic court decisions and the USDOC determinations 
that India  invoked .1839 
In US – Carbon Steel (India) , India presented an "as such" challenge against certain 
statutory provisions of US domestic law, including Section 776(b ) of the Tariff Act prior to the 
changes introduced by the Section 502 of the Trade Preferences Extension Act of 2015 (the  
2015 TPEA Amendment ).1840 The Appellate  Body found that the written measure at issue, "on its 
face", does not require the investigating authority to act inconsistently with Article  12.7.1841 Noting 
that the "practice" of the USDOC was "distinct and separate" from the written measure at issue, the 
Appellate Body observed that "India expressly clarified that it did not challenge the 'practice ' of the 
USDOC in the application of the measure 'as such'" .1842 As to the USDOC 's determinations that India 
presented in support of its case, the Appellate  Body did not understand "why a number of instances 
of the application of the measure should, in this case, conclusively establish the meaning of the 
measure at issue in general, which … is confined to" the written measure at issue.1843 Following a 
very brief analysis of the USDOC 's determinations, the Appellate  Body also noted that "the 
United  States  placed a number of cases on the Panel record where the 'worst possible inference ' was 
not applied in instances of non -cooperation" .1844 The Appellate  Body's analysis, including its 
discussion of US court rulings, was thus not aimed at ascertaining the USDOC 's alleged "practice" – 
a measure that was not challenged by India – but instead sought to determine whether the written  
"measure at issue is mandatory in r equiring the use of the worst possible information in all cases of 
non-cooperation" .1845 
Korea acknowledges that its "as such" claim in the present dispute is "different from that of 
India" and "is not that under AFA, the USDOC will always use the worst info rmation possible" .1846 
Moreover, Korea 's claim is not directed at the written legislation.1847 The Appellate  Body's findings 
in US – Carbon Steel (India ) were made in the context of the claim and evidence presented by 
India – both of which are not exactly the same as what Korea presents before us. Neither the 
Appellate  Body nor the panel in that dispute sought to ascertain the existence and precise content 
of the USDOC 's alleged "practice" , as it was not the measure challenged by India. For these reasons, 
we di sagree with Korea that the Appellate  Body in US – Carbon Steel (India ) somehow  "implicitly 
acknowledged that there exists a practice of always  using AFA in cases of non -cooperation" .1848 
Korea submits that the panel and the Appellate  Body's findings in US – Anti-Dumping 
Methodologies (China)  "confirm the position of Korea that the United  States'  use of adverse facts 
available is a rule or norm of general and prospective application".1849 Korea notes the "overlap in 
terms of the U.S. statutory basis for the AFA  Norm in this dispute (Section 776 of the Tariff Act 
of 1930)" and the content of the AFA Norm in that prior dispute, which it variously describes as 
"identical", "almost identical", "very similar" , and "similar".1850 Observing that the measure at issue 
in US – Anti-Dumping Methodologies (China ) "related to [non-market economy] NME-wide entities, 
which are not even arguably relevant to this proceeding", the United  States  responds that 
Korea 's discussion of this report offers no support for establishing the pr ecise content or general and 
prospective nature of the specific unwritten measure at issue in the present proceedings.1851  
 
1839 Korea's  first written submission, paras.  969-970. 
1840 Appellate  Body Report, US – Carbon Steel (India) , paras.  4.464 -4.466. See also Korea's  first written 
submission, para.  967. 
1841 Appellate  Body Report, US – Carbon Steel (India) , para.  4.470.  
1842 Appell ate Body Report, US – Carbon Steel (India) , fn 1180.  
1843 Appellate  Body Report, US – Carbon Steel (India) , para.  4.480.  
1844 Appellate  Body Report, US – Carbon Steel (India) , para.  4.480.  
1845 Appellate  Body Report, US – Carbon Steel (India) , para.  4.477. Furtherm ore, we note that, in 
respect of one of the judicial decisions relied upon by India, the Appellate  Body observed that it "points to 
accuracy as the goal for applying the inference in the measure". (Ibid. para. 4.475).  
1846 Korea's  first written submission, pa ra. 974. 
1847 Korea's  second written submission, para. 374; response to Panel question No. 40(c); comments on 
draft descriptive part, para.  1. 
1848 Korea's  first written submission, para.  971. (emphasis added)  
1849 Korea's  first written submission, para.  979. 
1850 Korea's first written submission, paras.  995 and 977 -978.  
1851 United  States'  second written submission, paras.  441 and 457.  WT/DS539/ R 
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We disagree with Korea that the manner in which Korea 's panel request identifies the 
measure is also how the measure was identified in  US – Anti-Dumping Methodologies (China) .1852 
In that case, China 's panel request identified the unwritten measure as follows:  
When the USDOC considers that a producer or exporter has failed to cooperate by not 
acting to the best of its ability, it uses infe rences that are "adverse to the interests of 
that party in selecting from among the facts otherwise available". China refers to the 
USDOC 's approach as the "Use of Adverse Facts Available".1853 
China  further provided the following description of  the precise content of the unwritten measure at 
issue:  
[W]henever [the] USDOC considers that an NME -wide entity has failed to cooperate to 
the best of its ability, it systematically makes an adverse inference and selects, to 
determine the rate for the NME -wide entity, facts that are adverse  to the interests of 
that fictional entity and each of the producers/exporters included within it.1854 
Thus, the scope of the measure in US – Anti-Dumping Methodologies (China ) was expressly 
limited not only to those insta nces in anti -dumping investigations  where the USDOC found that "an 
NME wide entity has failed to cooperate" , but also to the determination of "the rate for the NME -wide 
entity". In such cases, China alleged that the USDOC selected "facts that are adverse  to the interests 
of that fictional entity and each of the producers/exporters included within it" . However, as the 
United  States'  correctly points out, the precise content of the alleged unwritten measure identified 
by Korea is not limited in this manner.1855 Korea submits that the findings in US – Anti-Dumping 
Methodologies (China ) nonetheless  remain "relevant for the present dispute as the same mechanism 
applies to non -NME situations".1856 However, Korea offers no further explanation as to why "the 
same mechan ism applies to non -NME situations" at issue in the present dispute.  
Finally, we note that the panel 's findings in that dispute were based on "73 determinations 
[placed] on the record [by China] where the NME -wide entity was found to be non -cooperating"  prior 
to the 2015 TPEA Amendment .1857 By contrast, as discussed below, Korea submits a tabular 
summary and a "representative sample" of determinations  in which  the USDOC used  "adverse facts 
available"  since the  2015 TPEA A mendment.1858 In these circumstances, we consider  the 
panel 's finding in US – Anti-Dumping Methodologies (China ) concerning the precise content of the 
measure challenged in that dispute to be of limited relevance for purposes of establishing the 
existence of the allege d unwritten measure  with the precise content alleged by Korea  in these 
proceedings.  
Korea submits that the panel and Appellate  Body findings in US – Supercalendered Paper  
also confirm the use of "adverse facts available" as "ongoing conduct".1859 In that dis pute, Canada 
successfully challenged, as "ongoing conduct",  the "Other Forms of Assistance -AFA measure", which 
consisted of "the USDOC asking the 'other forms of assistance ' question and, where the USDOC 
'discovers ' information that it deems should have been provided in response to the above question, 
applying AFA with respect to the respondent to determine that the 'discovered ' information amounts 
to countervailable subsidies" .1860  
We note that the measure at issue in US – Supercalendered Paper was n otably different 
from – and narrower than – the alleged unwritten measure challenged by Korea in these 
proceedings. The "ongoing conduct" measure in that dispute  was limited to a fact pattern that could 
be triggered by a response to a specific question posed to a respondent during the course of 
countervailing duty investigations.1861 By contrast, the alleged unwritten measure at issue in the 
 
1852 Korea's  response to Panel question No.  104, para.  129. 
1853 US – Anti-Dumping Methodologies (China) , request for the establishment of a panel by China, p.  4. 
1854 Panel Report, US – Anti-Dumping Methodologies (China) , para.  7.422. (emphasis original)  
1855 Korea'  second written submission, para. 183.  
1856 Korea'  second written submission, para.  377. 
1857 Panel Report, US – Anti-Dumpi ng Methodologies (China) , para.  7.452.  
1858 Korea's  first written submission, para.  919. 
1859 Korea's  first written submission, section  V.5.3; opening statement at the second meeting of the 
Panel, para.  111. 
1860 Panel Report, US – Supercalendered Paper , para. 7.308.  
1861 Panel Report, US – Supercalendered Paper , para. 7.295.  WT/DS539/ R 
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  present dispute is limited neither to the USDOC posing a specific question, nor to the conduct of 
countervailing duty i nvestigations. Contrary to Korea 's arguments, we find nothing in the panel and 
Appellate  Body reports in US – Supercalendered Paper to suggest that the "same reasoning applies 
to this dispute and Korea 's challenge of the USDOC 's use of AFA in cases of non -cooperation more 
generally" .1862 
We recall that panels must " not lightly assume  the existence"1863 of an unwritten measure 
and must exercise " [p]articular rigour  … to support a conclusion as to the existence of a 'rule or 
norm ' that is not expressed in the for m of a written document" .1864 In keeping with these duties, our 
findings on the existence of an unwritten measure cannot be based on certain general observations 
made by panels and the Appellate  Body in prior WTO disputes. The precise content  and scope  of the 
alleged unwritten measure identified by Korea in this dispute are different from that of the measures 
challenged in prior WTO disputes. The evidence that Korea adduces is also  not exactly the same  as 
the evidence that was examined in these past cases. In US – Carbon Steel (India) , the 
Appellate  Body examined a claim against written  US legislation and emphasized that India did not 
challenge an unwritten practice. Given the Appellate Body's  limited engagement with the factua l 
question  of the existence of such a practice, its observations in that dispute  cannot , in our view,  
demonstrate the existence of the  alleged unwritten measure identified by Korea in this dispute.  The 
measures at issue in US – Anti-Dumping Methodologies ( China)  and US – Supercalendered Paper  
were also limited to a significantly narrower set of circumstances  and situations  in contrast to the 
broad scope of the  alleged  unwritten measure challenged by Korea in these proceedings , which is 
triggered upon a find ing of non -cooperation by the USDOC in any circumstance and on any question 
or issue .  
Even if the measures at issue were the same – which they are not  – we note that "factual 
findings made in prior disputes do not determine facts in another dispute".1865 Although "[e]vidence 
adduced in one proceeding, and admissions made in respect of the same factual question about the 
operation of an aspect of municipal law, may be submitted as evidence in another proceeding", 
panels, as the "finders of fact [,] are of course obliged to make their own determination afresh and 
on the basis of all the evidence before them".1866 Only if the "critical evidence is the same and the 
factual question about the operation of domestic law is the same", is it "likely that the finder of facts 
would reach similar findings in the two proceedings".1867 In these circumstances, we cannot agree 
with Korea that these prior WTO disputes "confirmed the existence of the United  States'  AFA Norm 
or similar AFA Ongoing Conduct" nor that they " confirm the claims made by Korea about the use of 
AFA as a Norm or as a form of Ongoing Conduct".1868 We now turn to examine the specific arguments 
and evidence presented by Korea in these proceedings to establish the existence of the alleged 
unwritten measu re at issue.  
7.4.5   Whether Korea has established the existence of the AFA rule or a norm  with the 
precise content alleged by it   
When an unwritten rule or a norm is challenged "as such", a complainant is required to 
adduce arguments and supporting evidence to de monstrate the precise content, attribution, and 
general and prospective nature of the rule or norm.1869 We therefore begin by examining whether 
Korea has established the existence of the unwritten measure with the precise content alleged by it. 
To this end , Korea presents arguments and evidence concerning  (i) statutory provisions of US law, 
namely Section 776 of the Tariff Act of 1930 (9 U.S.C 1677 (e)), as amended by the 2015 TPEA 
Amendment1870; (ii) the USDOC Anti -Dumping Manual1871; (iii) certain rulings by US  courts1872; and 
(iv) certain anti -dumping and countervailing duty determinations by the USDOC.1873 We address 
 
1862 Korea's  first written sub mission, para.  1000.  
1863 Appellate  Body Report, US – Zeroing (EC) , para.  196. (emphasis added)  
1864 Appellate  Body Report, US – Zeroing (EC) , para.  198 (first italics added; second italics original).  See 
also para.  7.609  above.  
1865 Appellate  Body Report, US – Continued Zeroing , para.  190. 
1866 Appellate  Body Report, US – Continued Zeroing , para.  190. 
1867 Appellate  Body Report, US – Continued Zeroing , para.  190. 
1868 Korea's  first wri tten submission, para.  962. 
1869 Appellate  Body Report, US – Anti-Dumping Methodologies (China) , para.  5.127.  
1870 Korea's  first written submission, paras.  897-909.  
1871 Korea's  first written submission, para.  912. 
1872 Korea's  first written submission, paras.  920-921. 
1873 Korea's  first written submission, paras.  913-919. WT/DS539/ R 
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  these different bases in turn, beginning with the written instruments and rulings  that Korea invokes  
before examining the USDOC 's alleged practice.  
Written instruments and rulings  
7.4.5.1.1   Statutory provisions of US law  
Korea relies upon Section 776 of the Tariff Act (19 U.S.C 1677 (e))  as modified by the 
2015 TPEA Amendment, which reads as follows:  
(a) In general  
If –  
(1) necessary information is not available on the record, or  
(2) an interested party or any other person  –  
(A) withholds information that has been requested by the administering authority or the 
Commission under this subtitle,  
(B) fails to provide such information by the deadlines for su bmission of the information 
or in the form and manner requested, subject to subsections (c)(1)  and (e)  of 
section  1677m of this title,  
(C) significantly impedes a proceeding under this subtitle, or  
(D) provides such information but the information cannot b e verified as provided in 
section  1677m(i)  of this title,  
the administering authority and the Commission shall, subject to section  1677m(d)  of 
this title, use the facts otherwise available in reaching the applicable determination 
under this subtitle.  
(b) Adverse inferences  
(1) In general  
If the administering authority or the Commission (as the case may be)  finds that an 
interested party has failed to cooperate by not acting to the best of its ability to comply 
with a request for information from the admin istering authority or the Commission, the 
administering authority or the Commission (as the case may be), in reaching the 
applicable determination under this subtitle –  
(A) may use an inference that is adverse to the interests of that party in selecting f rom 
among the facts otherwise available; and  
(B) is not required to determine, or make any adjustments to, a countervailable subsidy 
rate or weighted average dumping margin based on any assumptions about information 
the interested party would have provided  if the interested party had complied with the 
request for information.  
(2) Potential sources of information for adverse inferences  
An adverse inference under paragraph  (1)(A)  may include reliance on information 
derived from –  
(A) the petition,  
(B) a final determination in the investigation under this subtitle,  WT/DS539/ R 
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  (C) any previous review under section  1675 of this title or determination under 
section  1675b of this title, or  
(D) any other information placed on the record.  
(c) Corroboration of secondary inform ation  
(1) In general  
Except as provided in paragraph  (2), when the administering authority or the 
Commission relies on secondary information rather than on information obtained in the 
course of an investigation or review, the administering authority or th e Commission, as 
the case may be, shall, to the extent practicable, corroborate that information from 
independent sources that are reasonably at their disposal.  
(2) Exception  
The administrative authority and the Commission shall not be required to corrobor ate 
any dumping margin or countervailing duty applied in a separate segment of the same 
proceeding.  
(d) Subsidy rates and dumping margins in adverse inference determinations  
(1) In general  
If the administering authority uses an inference that is adverse to the interests of a 
party under sub section  (b)(1)(A)  in selecting among the facts otherwise available, the 
administering authority may –  
(A) in the case of a countervailing duty proceeding –  
(i) use a countervailable subsidy rate applied for the same or similar program in a 
countervailing duty proceeding involving the same country; or  
(ii) if there is no same or similar program, use a countervailable subsidy rate for a 
subsidy program from a proceeding that the administering authority considers 
reasonable to use; and  
(B) in the case of an antidumping duty proceeding, use any dumping margin from any 
segment of the proceeding under the applicable antidumping order.  
(2) Discretion to apply highest rate  
In carrying out paragraph  (1), the administering authority may apply any of the 
countervailable subsidy rates or dumping margins specified under that paragraph, 
including the highest such rate or margin, based on the evaluation by the administering 
authority of the situation that resulted in the administ ering authority using an adverse 
inference in selecting among the facts otherwise available.  
(3) No obligation to make certain estimates or address certain claims  
If the administering authority uses an adverse inference under sub section  (b)(1)(A)  in 
selecting among the facts otherwise available, the administering authority is not 
required, for purposes of sub section  (c) or for any other purpose –  
(A) to estimate what the countervailable subsidy rate or dumping margin would have 
been if the interested part y found to have failed to cooperate under 
subsection  (b)(1)  had cooperated; or  WT/DS539/ R 
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  (B) to demonstrate that the countervailable subsidy rate or dumping margin used by 
the administering authority reflects an alleged commercial reality of the interested 
party.1874 
Korea makes clear that it does not challenge the written law "as such", but instead relies 
upon the text of the statute to make the limited point that it:  
[P]rovides the express permission  for the USDOC to act the way it does. Although the 
statute may not require  the WTO -inconsistent behavior, it does describe the practice  of 
the USDOC and gives discretion  to the USDOC to act in this incompliant manner by, for 
example, expressly relieving the USDOC of certain tasks of corroboration and special 
circumspection. It is not because Korea ultimately decided to focus its claim on the 
unwritten measure that the written permission  for the measure becomes irrelevant for 
purposes of describing the specific contents of the measure.1875 
The United  States  considers it "nonsensical" that Korea seeks to prove the existence of an 
unwritten measure, by reference to a written la w.1876 According to the United  States , "Korea has not 
pursued a claim against any provision of the U.S. statute, which of course is a written measure. 
Therefore, the contents of this statute do not support the alleged existence of an unwritten  measure 
with t he precise content reflecting Korea 's description in its panel request" .1877  
We agree with previous findings to the effect that the specific measure challenged and how 
it is described and characterized by a complainant will determine the kind of evidence th e 
complainant is required to submit and the elements that it must prove in order to establish the 
existence of the measure.1878 We note that, as part of identifying the unwritten measure in its panel 
request, Korea provides the following explanation:  
The use  of adverse facts available has been consistently applied by the USDOC and is 
undertaken pursuant to : (i) Section 502 of the Trade Preferences Extension Act of 2015, 
Pub. L. No. 114 -27; (ii ) Section 776 of the Tariff Act of 1930, codified at 
19 U.S.C.  § 1677e; and (iii ) the implementing regulations of the USDOC in 19  C.F.R. 
§ 351, including in particular section  308.1879 
Korea clearly indicates that, although it is not challenging the written legislation individually 
and "as such", the alleged unwritten measu re is undertaken pursuant to the "discretion" or 
"permission" granted under the written legislation. Contrary to the United  States , we see nothing 
"nonsensical" insofar as Korea seeks to rely upon the text of a written measure for the limited 
purpose clear ly stated by it. We see no compelling reason as to why, in challenging unwritten 
measures, complainants should a priori be precluded from relying on the text of a written measure 
as evidence. Rather, what is important is the manner in which a complainant r elies on the written 
measure as evidence in support of its arguments concerning the existence of the unwritten measure.  
Turning to the legislation, Korea explains that "[p]rior to the enactment of the TPEA, the 
USDOC and the USITC … possessed the authorit y under 19 U.S.C. 1677e(i ) to make determinations 
on the basis of facts available, in line with Article  6.8 of the Anti -Dumping  Agreement  and 
Article  12.7 of the SCM  Agreement ". According to Korea, the "TPEA Amendment [] made a number 
of key changes to U.S. law that significantly altered the manner in which the authorities make such 
determinations" .1880 Specifically, Korea avers that the "checks and balances that may have existed 
in the past, have been removed by the TPEA amendment [], leading to the use of AFA as a rule or 
norm with general and prospective application, or as ongoing conduct", that violates the relevant 
provisions of the covered agreement s.1881 On this basis, Korea asse rts that the 
 
1874 Section 776 of the Tariff Act, (Exhibit  KOR-245), pp.  1-2. 
1875 Korea's  second written submission, para.  374. (italics original; underlining added)  
1876 United  States'  first written submission, para.  440. 
1877 United  States'  second written submission, para.  141. (emphasis original)  
1878 Appellate  Body Reports, Argentina – Import Measures , para. 5.110.  
1879 Korea's  panel request, fn  1. 
1880 Korea's  first written submi ssion, paras.  898-899. 
1881 Korea's  response to Panel question No.  40(a).  WT/DS539/ R 
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  2015 TPEA Amendment "essentially codified  and supported  the existing practice of the USDOC and 
are a good reflection  of the precise content of the AFA Norm or Ongoing Conduct".1882  
The United  States , for its part, "strongly maintains" that "no provision in the TPEA, whether 
in isolation or in combination with another provision, breaches the covered  Agreement s".1883 
According to the United  States , because the various statutory provisions raised by Korea are 
"inherently limited to particular context s that do not exist in all or even most cases, they most 
certainly cannot be relied upon to demonstrate the as such WTO -inconsistency of an unwritten 
measure".1884  
Although the written legislation  identified by Korea  contains many provisions, for purposes 
of establishing the precise content of the alleged unwritten measure, Korea relies on certain changes 
made by the 2015 TPEA Amendment with a view to identifying the "most important points" for its 
case.1885  
First, acc ording to Korea, sub section  (d) allows competent authorities to "use as the 'facts 
otherwise available ' a countervailable subsidy rate or dumping margin meeting, including the highest 
rate or margin, when making an inference adverse to a party 's interests" . Relatedly, according to 
Korea, competent authorities are now "permitted to use a subsidy rate for a subsidy program from 
any proceeding that the authority considers reasonable, irrespective of the fact that such rates are 
obviously company specific and m ay thus not be pertinent to the producer or exporter under 
examination".1886 
Second, Korea points out that, under sub section  (c)(2), competent authorities are no longer 
"required to corroborate any dumping margin or subsidy rate as soon as it has already been applied 
in a separate segment of the same proceeding, and this irrespective of whether the facts and other 
available information is different from what prevailed at the time of that prior determination".1887 
Third, and finally, Korea considers t hat, under the amended law, competent authorities are no longer 
"required to determine, or make any adjustments to, a countervailable subsidy rate or dumping 
margin based on any assumptions about information the interested party would have provided or 
that otherwise represents the 'commercial reality ' of the interested party if it had complied with a 
request for information".1888 
It is clear that our task is not to examine whether these provisions or aspects thereof are 
"as such" inconsistent with the applica ble provisions of the covered agreement s. We recall in this 
regard that although Korea included an "as such" claim of WTO -inconsistency against the 
2015 TPEA Amendment, it subsequently decided not to pursue this "as such" claim against the 
written legislat ion, focusing instead on its claim against the alleged unwritten measure.1889 
Therefore, we limit our analysis to examining the factual conclusions that Korea seeks to draw based 
on the written legislation for purposes of establishing the precise content of the alleged unwritten 
measure.  
As to Korea 's first point, we note that sub section  (d) – entitled "Subsidy rates and dumping 
margins in adverse inference determinations" – permits competent authorities, when using adverse 
inferences in "selecting from the f acts otherwise available", to engage in certain conduct. Specifically, 
for countervailing duty proceedings, competent authorities using adverse inferences "may" "(i ) use 
a countervailable subsidy rate applied for the same or similar program in a countervai ling duty 
proceeding involving the same country; or (ii ) if there is no same or similar program, use a 
countervailable subsidy rate for a subsidy program from a proceeding that the administering 
authority considers reasonable to use". In the case of anti -dumping proceedings, competent 
 
1882 Korea's  first written submission, para.  909. (emphasis added)  
1883 United  States'  second written submission, para.  149. 
1884 United  States'  second written submission, para.  149. 
1885 Korea's  first written submission, para.  907. 
1886 Korea's  first written submission, paras.  904 and 907.  
1887 Korea's  first written submission, paras.  902 and 907.  
1888 Korea's  first written submission, paras.  906-907. 
1889 Korea's  second written submission, para. 374; response to Panel question No. 40(c);  comments on 
draft descriptive part, para.  1. WT/DS539/ R 
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  authorities "may" "use any dumping margin from any segment of the proceeding under the 
applicable antidumping order".  
Korea alleges that " [t]his change permits the USDOC to apply an adverse dumping margin 
or subsidy rate without having to exercise reason and judgment  or to demonstrate otherwise the 
reasonableness  of the adverse rate selected for purposes of arriving at an accurate 
determination" .1890 We note, however, that, in the case of countervailing duty proceedings, 
subsection (d)(1)(A)(ii ) permits competent authorities to "use a countervailable subsidy rate for a 
subsidy program from a proceeding that the administering authority considers reasonable to use " in 
cases where there "is no same or similar program".1891 In our view , contrary to Korea 's position, this 
provision does not wholly preclude the exercise of reason and judgment by a competent authority 
in such cases.  
In a similar fashion, sub section  (d)(2) – entitled "Discretion to apply highest rate" – provides 
that competent authorities "may" apply any of the countervailable subsidy rates or dumping margins 
specified above, "including the highest such rate or margin, based on the evaluation by the 
administering authority of the situation that resulted i n the administering authority using an adverse 
inference in selecting among the facts otherwise available ".1892 Thus, in permitting investigating 
authorities to select various rates or margins, including the highest, the provision requires that this 
be "base d on the evaluation" by the investigating authority of the procedural circumstances 
surrounding non -cooperation in selecting "among the facts otherwise available". This is important 
not only because it implies reasoning and evaluation on the part of the co mpetent authority, but 
also because one of the key features of the unwritten measure identified by Korea is that the USDOC 
draws "adverse inferences" without taking  into account the procedural circumstances of 
non-cooperation.  
Korea 's second point concern s sub section  (c)(2), which sets out the "exception" to the 
"corroboration of secondary information". The provision states that competent authorities "shall not 
be required to corroborate any dumping margin or countervailing duty applied in a separate segme nt 
of the same proceeding". According to Korea, competent authorities can thus rely upon a margin or 
a duty from a separate segment of the same proceeding without "corroboration", "even if it is based 
on secondary source information".1893 We agree with Korea  that the provision makes clear that 
competent authorities "shall not be  required  to corroborate any dumping margin or countervailing 
duty applied in a separate segment of the same proceeding".1894 
Korea 's third and final point concerns sub section  (d)(3) – entitled "No obligation to make 
certain estimates or address certain claims". When using an "adverse inference … in selecting among 
the facts otherwise available", this provision makes clear that competent authorities are not required 
"to estimate what the countervailable subsidy rate or dumping margin would have been" if the 
interested party had cooperated; or, "to demonstrate that the countervailable subsidy rate or 
dumping margin used by the administering authority reflects an alleged commercial reality  of the 
interested party" .1895  
While we note these aspects of the provision, we find it difficult to draw any meaningful 
conclusions from them in the abstract. Although the term "alleged commercial reality" may be used 
under US law, we note that it is not fou nd in the covered agreement s and Korea does not engage 
with its meaning and implications in greater detail as part of its discussion of the written legislation. 
This, together with the fact that Korea does not challenge this specific provision on an "as su ch" 
basis, prevents us from drawing any comparisons between the concept of "commercial reality" under 
the written legislation and the "reasonableness" of the replacement facts under the covered 
agreement s.  
Having addressed the specific points raised by Ko rea for purposes of establishing the precise 
content of the unwritten measure, we now turn to the general conclusions that Korea draws based 
upon the text of the provision. First, Korea concludes that the provision "gives full discretion  to the 
 
1890 Korea's  first written submission, para.  907. (emphasis added)  
1891 Emphasis added.  
1892 Emphasis added.  
1893 Korea's  first written su bmission, para.  902. 
1894 Emphasis added.  
1895 Emphasis added.  WT/DS539/ R 
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  authorities  to apply the highest rate or margin available from among the available dumping margins 
or countervailable subsidy rates, without the need to corroborate such margins".1896 As discussed 
above, however, this is not entirely accurate inasmuch as the provision allows the selection of the 
highest rate or margin "based on the evaluation by the administering authority of the situation that 
resulted in the administering authority using an adverse inference in selecting among the facts 
otherwise available" . Contrary to Korea 's conclusion, the discretion available to the competent 
authorities in such cases is not "full" or entirely unbounded, as the provision clearly requires an 
evaluation of the particular situation of non -cooperation leading to the use of the facts a vailable in 
a given investigation.  
Second, Korea asserts that the provision "essentially codified and supported the existing 
practice of the USDOC" and is therefore "a good reflection of the precise content of the AFA Norm 
or Ongoing Conduct".1897 We find n othing in the statutory text to suggest that the provision somehow 
"codifies" the "existing practice" of the USDOC. Korea does not offer any further explanation or 
evidence in support of its assertion. The written legislation does not show how frequently t he 
discretion available thereunder to the USDOC is actually exercised in a WTO -inconsistent manner. 
This is an essential aspect of Korea 's alleged unwritten measure. That said,  we note the  various 
permissive aspects of the written legislation that Korea highlights insofar as they bear upon the 
USDOC 's selection of replacement facts  and are relevant to understanding what Korea describes as 
the "written permission" for the alleged unwritten n orm.  
7.4.5.1.2   USDOC Anti -Dumping Manual  
The next piece of evidence that Korea relies upon to establish the existence of the unwritten 
measure with the precise content alleged by it is the USDOC  Anti-Dumping Manual, which is "used 
for the 'internal training and gui dance of Enforcement and Compliance (E&C ) personnel'".1898 
Specifically, Korea quotes the following excerpt from the USDOC Anti -Dumping Manual:  
[I]f the respondent has not cooperated to the best of its ability in supplying information, 
E&C can make an adverse inference in choosing which facts to use. The potential use 
of adverse facts available gives respondents incentive to cooperate fully in providing 
the information requested by E&C.1899 
The United  States  points out that the USDOC Anti -Dumping Manual e xpressly disclaims that it 
"cannot be cited to establish DOC practice".1900  
Besides the issue of the normative value of the Anti -Dumping Manual – which is also relevant 
for analysing the general and prospective nature of the alleged unwritten norm – for pre sent 
purposes, we note that the excerpt quoted by Korea envisages that the USDOC " can make  an 
adverse inference in choosing which facts to use".1901 Thus, not only is it cast in permissive terms 
when envisaging the use of "adverse inferences", but it also su ggests that such inferences are aimed 
at "choosing which facts to use". In keeping with the permissive nature of the text, the second 
sentence refers to the " potential  use" of "adverse facts available" as providing an "incentive" to 
respondents "to coopera te fully in providing the information requested". We find nothing in the 
excerpt requiring  the selection of facts by the USDOC that are adverse to the interests of the 
non-cooperating party based solely on a finding of non -cooperation, which, as discussed above, is 
an important feature of the alleged unwritten measure identified by Korea. As discussed below, we 
also note that the alleged unwritten measure identified by Korea is not described in terms of the 
USDOC 's "policy" of using "adverse facts available" as an "incentive to cooperate".1902 In these 
circumstances, we consider the single excerpt from the USDOC Anti -Dumping Manual that Korea 
cites to be of limited utility for demonstrating the "precise content" of the alleged unwritten measure.  
 
1896 Korea's  first written submission, para.  909. (emphasis added)  
1897 Korea's  first written submission, para.  909.  
1898 Korea's  first written submission, para.  912 (quoting USDOC Anti -Dumping Manual, 
(Exhibit KOR-226), pp.  1 and 4).  
1899 Korea's  first written submission, para.  912 (quoting USDOC Anti -Dumping Manual, 
(Exhibit  KOR-226), pp.  1 and 4).  
1900 United  States'  second written submission, fn  233 (quoting USDOC Anti -Dumping Manual, 
(Exhibit  KOR-226), p.  1). 
1901 Emphasis added.  
1902 See paras. 7.658 -7.659  below.  WT/DS539/ R 
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  7.4.5.1.3   Rulin gs by US courts  
Korea asserts that "[s]everal rulings of the [USCIT ] and the U.S. Court of Appeals for the 
Federal Circuit ('USCAFC' ) are consistent with the description of the contents of" the alleged 
unwritten measure.1903 Referring to court rulings betwee n 2000 and 2017, Korea asserts that US 
courts have confirmed that when resorting to the use of facts available, the USDOC relies on various 
"secondary"  sources of information (the petition, the final determination from the investigation, prior 
administrati ve reviews, or any other information placed on the record ) to select a proxy that should 
be a "reasonably accurate estimate of the respondent 's actual rate, albeit with some built -in increase 
intended as a deterrent to noncompliance ".1904 Based solely on thi s excerpt, Korea argues that 
"[e]ven according to the U.S. courts, therefore, the drawing of adverse inferences seeks to induce 
cooperation by respondents".1905 The United  States , for its part, responds that US courts "have 
stated unambiguously that, under U .S. law, application of adverse inferences in resorting to facts 
available cannot be punitive".1906 
We note, first, that, somewhat contrary to Korea 's arguments that the USDOC "consistently 
does not seek to replace the missing information with the facts othe rwise available in order to arrive 
at an accurate determination"1907, the excerpt from the US court rulings that Korea relies upon 
expressly recognizes that selected replacement facts should be a " reasonably accurate  estimate  of 
the respondent 's actual rate" .1908 Korea does not explain how this language supports the existence 
of its alleged unwritten measure. Korea also does not address the United  States'  assertion that its 
courts have stated that the application of "adverse inferences" cannot be "punitive ". Second, insofar 
as Korea argues that "the drawing of adverse inferences seeks to induce cooperation by 
respondents"1909, we note that the question before us is not whether and to what extent the 
mechanism of "facts available" can generally be used to "induce  cooperation". As discussed above, 
the alleged unwritten measure identified by Korea has several interlinked aspects that must each be 
demonstrated for the alleged unwritten measure to exist.  The measure is not described in terms of 
a "policy" or "tool" of  using "adverse facts available" or a "built -in increase" to incentivize 
cooperation. Korea can, of course, seek to rely upon the "policy" underlying the measure to establish 
certain aspects, such as its allegedly general and prospective nature, but this i s not enough to 
discharge its burden of establishing the existence of the unwritten measure with the precise content 
alleged by it.   
We also note that Korea acknowledges that the "degree of cooperation is something that 
can be taken into consideration in t he weighing and balancing of different pieces of information and 
evidence on the record".1910 Amongst the third parties, the European Union "agrees … that the use 
of adverse inferences is not necessarily inconsistent, in all circumstances, with Article  6.8 o f the 
Anti-Dumping  Agreement  and Article  12.7 of the SCM  Agreement " and "that the use of adverse 
inferences … would be justified in cases of fraud or total lack of cooperation by the producer or 
exporter in question" .1911 Pointing out that "Annex  II of the A nti-Dumping  Agreement  contemplates 
the possibility that the use of facts available may result in a less favourable outcome for an interested 
party" , Canada – another third party – submits that this "d[oes] not preclude the use of adverse 
inferences in all situations".1912 In these circumstances, and given the alleged unwritten measure 
 
1903 Korea's  first written s ubmission, para.  920. 
1904 Korea's  first written submission, para.  921 (quoting Essar Steel Ltd. v. United  States, 
(Exhibit  KOR-175), p.  1373, in turn quoting De Cecco Di Filippo Fara. S. Martino v. United  States, 
(Exhibit  KOR-176), p.  1032; Özdemir Boru San.  ve Tic. Ltd. Sti. v. United  States, (Exhibit  KOR-177), p.  1245, 
in turn quoting De Cecco Di Filippo Fara. S. Martino v. United  States, (Exhibit  KOR-176), p.  1032; and Lifestyle 
Enterprise, Inc. v United  States, (Exhibit  KOR-178), p.  1298, in turn quoting De Cecco Di Filippo Fara. S. 
Martino v. United  States, (Exhibit  KOR-176), p.  1032 (emphasis original)).  
1905 Korea's  first written submission, para.  921. 
1906 United  States'  second written submission, para.  195; first written submission, para.  485 (referring 
to Viet I -Mei Frozen Foods Co. v. United  States, (Exhibit  USA-61), pp.  11-12). 
1907 Korea's first written submission, para. 880.  
1908 Emphasis added.  
1909 Korea's  first written submission, para.  921. 
1910 Korea's  response to Panel question No.  50, para.  10. See also Korea's  response to Panel question 
No. 44 (noting that "a reasonable degree of inference is warranted in order to prevent the party from 
benefiting from its  non-cooperation" and that "drawing an adverse inference in the ordinary sense is still aimed 
at achieving a reasonably accurate result and is part of a process of reasoning and evaluation of all of the 
evidence and facts on the record").  
1911 European Union' s third-party submission, para.  81. 
1912 Canada's  third-party submission, para.  18. WT/DS539/ R 
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  specifically identified by Korea, we do not consider that a single quote from court rulings recognizing 
that the replacement facts must be a "reasonably accurate estimate", albe it with a "built -in increase" 
to promote compliance, suffices to demonstrate the precise content of the alleged unwritten measure 
or the "policy" underlying such a measure.  
The USDOC 's alleged "practice"  
Korea submits that the  existence of the unwritten me asure with the  precise content  alleged 
by it is "established" and "confirmed" by the way the USDOC has "repeatedly and consistently 
exercised its discretion" in the use of "adverse facts available" since the enactment of the 
2015 TPEA Amendment.1913 In suppo rt of its assertion, Korea submits a "list of all [319] proceedings 
in which AFA was used since the amendment[] of Section 502 of the TPEA".1914 Furthermore, as a 
"representative sample", Korea presents an "overview table of 12 cases involving different prod ucts 
related to determinations made at different times, which all confirm the precise content" of the 
alleged unwritten measure and "reflect the automatic link between a finding of a failure to 
cooperate  … and the drawing of adverse inferences".1915  
The United  States  points out that "Korea 's approach, as a logical matter, is fundamentally 
incapable of demonstrating the conclusion it draws".1916 According to the United  States , Korea 's list 
starts with all 319  cases in which adverse inferences allegedly were applied , and its assertion that 
all but 13 cases included some language regarding failure to cooperate "simply shows the frequency 
of non -cooperation findings in those 319  cases".1917 However, it is "incapable of establishing the 
frequency wit h which [the] USDOC applies adverse inferences when it finds non -cooperation", 
because, "[a]t minimum, one would need to start with the universe of instances in which [the] 
USDOC found non -cooperation, and then measure how often within the context of those  instances 
[the] USDOC applied adverse inferences".1918 The United  States  identifies several other 
methodological issues with Korea 's approach and takes issue with its "conclusory" and 
"unsupported" statements and assertions.1919  
As to the "representative sam ple" of 12 cases offered by Korea, the United  States  highlights 
that "Korea does not indicate how it chose these 12 determinations or on what basis the Panel could 
conclude that they are representative of other determinations". According to the United  States, 
"[i]dentifying 12 determinations, out of hundreds that Korea itself cites, simply cannot support the 
existence of some sort of unwritten measure of general and prospective application" .1920 Moreover, 
the United  States  presents examples of the USDOC 's practice which, in its view, establish that 
whenever it finds non -cooperation the USDOC does not  (a) always make adverse inferences1921; and 
(b) cease to engage in any reasoning and evaluation and uses the finding of non -cooperation as the 
sole basis of selecti ng the replacement facts.1922 
We recall that the only alleged unwritten measure at issue in this dispute is the one identified 
in Korea 's panel request.1923 Our task is therefore to examine whether the USDOC 's practice that 
Korea relies upon establishes the  existence of the unwritten measure with the precise content alleged 
by Korea.  
Turning to the database of 319  cases, Korea submits that this is a list of "all proceedings  in 
which AFA was used" by the USDOC since the 2015 TPEA Amendment.1924 The United  States  points 
 
1913 Korea's  first written submission, paras.  910 and 913.  
1914 Korea's  first written submission, para.  916. 
1915 Korea's  first written submission, para.  919. 
1916 United  States'  first written submission, para.  473. 
1917 United  States'  first written submission, para.  472. 
1918 United  States'  first written submission, para.  472. See also United  States'  second written 
submissio n, para.  187 (noting that "[a]n analogy would be if Korea maintained that whenever an animal has 
legs (trigger), it is a spider (consequence). Obviously, the correct way to test that would be start to with a set 
of animals that have legs ( i.e., the trigger ). If every animal is indeed a spider, then one may conclude that 
whenever an animal has legs, it is a spider.")  
1919 United  States'  first written submission, paras.  474-476. 
1920 United  States'  first written submission, para.  483. 
1921 United  States'  second writte n submission, paras.  152-165. 
1922 United  States'  second written submission, paras.  166-179. 
1923 See para. 7.597  above.  
1924 Korea's  first written submission, para.  916. (emp hasis added)  WT/DS539/ R 
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  out that, "[o]f the 319  cases listed … Korea double counts 59 cases. Specifically, Korea repeatedly 
counts the same case once as a preliminary determination, and  a second time as a final 
determination" .1925 Our assessment of the list provided by Korea reveals that, as pointed out by the 
United  States , Korea treats the preliminary and final determinations in the same investigation as 
two different "cases" or items fo r purposes of its database.1926 It is therefore more accurate to 
describe Korea 's database as comprising of 319  determinations – both preliminary and final – and 
not 319  investigations or proceedings.  
As to the United  States'  argument that Korea 's "statisti cal analysis" is logically flawed1927, 
we note that Korea 's begins with a "list of all [319] proceedings in which AFA was used  since the 
amendment [] of Section 502 of the TPEA"1928, and asserts that "all of these cases clearly show a 
failure to cooperate in su bstance".1929 We see merit in the United  States'  argument that beginning 
with a list of all instances when "adverse facts available" were used by the USDOC is insufficient to 
fully and definitively establish the automatic causal link between a finding of non -cooperation and 
the use of "adverse facts available" that Korea needs to establish.1930 As discussed above, the finding 
of non -cooperation is an important aspect of the alleged unwritten measure  because  it serves as the 
"trigger" and defines the universe of  situations in which the alleged unwritten measure applies. 
Therefore, in order to successfully establish the "automatic link" between a finding of 
non-cooperation and the use of "adverse facts available", a more sound approach would have been 
to begin wit h a list of all cases in which a finding of non -cooperation was made and then ascertain 
whether "adverse facts available" were used in all such cases.  
As to the contents of the database, Korea explains that the initial list of 319  determinations 
submitted to the  Panel  as Exhibit KOR -216 is "broken down by : Product; Country; Whether it 
concerns and anti -dumping or countervailing duty proceeding (AD/CVD); Whether it concerns an 
Investigation or a Review; Date; Federal Register citation; and Whether it involves a Non Market 
Economy ('NME' ) situation or a market situation".1931 In response to questioning by the Panel, Korea 
submits a revised "list of cases involving AFA, this time with two new columns indicating where a 
reference to AFA as a 'practice ' is being made and a brief summary of the 'practice ' related language 
for each of these".1932 
In its first written submission, Korea explains that, "[i]n all but 13 cases, the USDOC included 
standard language regarding a party 's 'failure to cooperate ' by failing to act to the best of its abilities 
in terms of responding to certain request for information from the USDOC" .1933 Moreover, in "virtually 
all of the 306 cases in which the language was included, the use of this language was boilerplate, 
and the USDOC was ci ting to the statutory provisions and requirements for an application of AFA in 
line with Section 776 of the Tariff Act of 1930, as amended".1934 According to Korea, the 
"consequence in all of these cases was the drawing of adverse inferences in the sense tha t the 
allegedly missing information was replaced with facts otherwise available that would ensure a result 
that was adverse to the interests of the foreign producer or exporter in question" .1935  
In response to questioning by Panel with respect to the 13 instances in the initial list where 
the USDOC did not include standard language regarding "failure to cooperate", Korea explains that 
it subsequently "discovered that in four of them, the USDOC did actually use the standard boilerplate 
language about the f ailure to cooperate".1936 According to Korea, "[t]his discovery is due to the fact 
that [it] had originally conducted [its] research based on LexisNexis which [it] understood to have 
included both the Federal Register and the Issues & Decision Memorandum for  each case" .1937 
 
1925 United  States'  second written submission, para.  193 (referring to List of duplicative cases in 
KOR-216, (Exhibit  USA-96 (revised))  (fn omitted)).  
1926 List of AFA proceedings, (Exhibit  KOR-216 (revised)); List of duplicative cases in KOR -216, 
(Exhibit  USA-96). 
1927 See, e.g. United  States'  second written submission, paras.  185-189. 
1928 Korea's  first written submission, para.  916. (emphasis added)  
1929 Korea's  response to Panel question No.  45.  
1930 United  States'  second written submission, paras. 185 -186. 
1931 Korea's  first written submission, para.  917. 
1932 Korea's  response to Panel question No.  45, fn  128; List of AFA proceedings, (Exhibit  KOR-216 
(revised)).  
1933 Korea's  first written submission, para.  918. 
1934 Korea's  first written submission, para.  918. 
1935 Korea 's first written submission, para.  918. 
1936 Korea's  response to Panel question No.  45. (fn  omitted)  
1937 Korea's  response to Panel question No.  45. (fn  omitted)  WT/DS539/ R 
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  However, it "found out that this was not always the case" and "upon examination of the final Issues 
& Decision Memorandum for these cases, [it] found that in four of them, the USDOC did actually 
make an express finding of a failure to cooper ate".1938 Korea asserts that, in any event, "all of these 
cases clearly show a failure to cooperate in substance" and the "few cases in which the boilerplate 
language is not used in extenso are thus equally based on the automatic link between 
non-cooperation  and the use of AFA" .1939 For Korea, statistics thus support the "conclusion that 
non-cooperation equals the use  of AFA, which in turn means the use of information that is sufficiently 
adverse to the interests of the producer or exporter in question".1940 
The database of 319  determinations provided by Korea contains a variety of information. 
For each of the 319  listed items, it indicates the "product" concerned (column A); the "country" at 
issue (column B); whether it is in the context of an anti -dumping or cou ntervailing duty investigation 
(column C); whether it concerns an original investigation or a review proceeding (column D); 
whether it represents a preliminary or a final determination (column E); the date of the 
determination (column F); the US "Federal R egister" citation for the determination (column G); 
whether it involves a non -market economy (NME ) or "market" situation (column H); whether the 
interested party "didn't respond" (column I – coded as "yes", "no", "yes (in part)", or "both"); and 
whether the determination includes language concerning the "failure to cooperate" (column J – coded 
as a "yes" or "no").1941 The revised list subsequently submitted by Korea adds two  columns indicating 
whether the determinations contain a reference to the "p ractice" of using "adverse facts available" 
by the USDOC (column K – coded as a "yes" or "no); and, finally, a "brief summary of the 
'practice ' related language" used in each determination.1942 
As to the information that is contained in Korea 's database, we note that for 119 out of 
the 319 determinations listed, the data in column K indicates that the USDOC made "no" reference 
to the "practice" of using "adverse facts available".1943 For the remaining 200 determinations, Korea 
provides limited excerpts of the " practice -related language" used by the USDOC. Useful as these 
pieces of information are, we note that Korea 's database provides very limited information about 
the USDOC 's actual use of "adverse inferences" or "adverse facts available" in each of the 
319 determinations. The limited information  contained  in the database does not provide full details 
of crucial aspects of the investigations at issue, including, the "necessary" information that was 
"missing" from the record; the "facts" that were otherwise avai lable to the USDOC; the procedural 
circumstances surrounding non -cooperation; how the "facts" selected by the USDOC were "adverse" 
to the interests of the non -cooperating party; and the USDOC 's analysis, if any, in selecting the 
replacement information. As  the United  States  points out, Korea does not "place the vast majority 
of these cases on the record of this dispute".1944 In fact, Korea places on the panel record the full 
text of the USDOC 's analysis in only 2 8 out of the 319 determinations that are includ ed in its 
database.1945  
The absence of such information in Korea 's database and its choice to not place on the record 
and engage with each of the 319 determinations is particularly problematic because, as we have 
found1946, the meaning  that Korea ascribes to the terms "adverse inferences" and "adverse facts 
available" constitute important features of the precise content of the alleged unwritten measure. 
As discussed, Korea alleges that the USDOC selects facts adverse to the interests of the 
non-cooperating party based  solely  on a finding of non -cooperation. Although, based on its database 
 
1938 Korea's  response to Panel question No.  45. (fn  omitted)  
1939 Korea's  response to Panel question No.  45. 
1940 Korea's  first written submission, para.  1011. (emphasis original)  
1941 List of AFA proceedings, (Exhibit  KOR-216 (revised)).  
1942 List of AFA proceedings, (Ex hibit KOR-216 (revised)). Korea's  response to Panel question No.  45, 
fn 128. 
1943 List of AFA proceedings, (Exhibit  KOR-216 (revised)). Korea explains in this regard that "it is of 
course not at all necessary for the USDOC to use this term in order for Korea to demonstrate the existence of a 
repeated, frequent, consistent, and extended use of an AFA rule or norm, or ongoing  conduct. In the 
first written submission, Korea already included a number of references to the USDOC itself referring to the 
AFA 'rule', and to its adverse selection of facts available as its practice in a number of the specific proceedings 
Korea challeng ed 'as applied'". (Korea's  response to Panel question No.  45 (fn  omitted)).  
1944 United  States'  second written submission, para.  193.  
1945 As discussed in paragraph  7.630  above, we note that, in contrast to Korea's  approach in the present 
dispute, in US – Anti-Dumping Methodologies (China) , China placed on the record the full text of the 
73 determinations where the "NME -wide entity was found to be non -cooper ating". (Panel Report, US – 
Anti-Dumping Methodologies (China) , para.  7.452).  
1946 See paras.  7.617 -7.619  above.  WT/DS539/ R 
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  of 319  determinations, Korea  draws the conclusion "that non -cooperation equals the use of AFA"1947, 
given the limited information contained in Korea 's databas e, and without access to all of the 
determinations cited by Korea, we are unable to examine whether the USDOC 's use of AFA or 
"adverse inferences" in these proceedings, in fact, corresponds with the meaning that Korea ascribes 
to these terms as part of its  identification of the precise content of the  alleged unwritten measure 
at issue.   
While the examples of "practice -related" language used by the USDOC in 200 of the 
319 determinations cited by Korea may, to some extent, indicate that the USDOC considered t he 
non-cooperation of an interested party as being relevant for its selection of the "facts available", we 
are unable to find, based on these excerpts alone, that this was the sole basis  for the 
USDOC 's ultimate selection of the facts available in these de terminations. Korea 's decision not to 
place on the Panel record each of the 319 determinations identified by it – let alone engage with 
them in greater detail – further limits our ability to examine whether the USDOC selected "adverse" 
facts based solely  on its finding of non -cooperation, without undertaking further analysis as to the 
reasonableness of the replacement facts – features that are crucial to the alleged unwritten measure 
identified by Korea.  
In the absence of the additional information identif ied above for each of the 
319 determinations relied upon by Korea – whether in a tabular form or by providing and discussing 
the full determinations – the Panel simply cannot examine the manner in and the extent to which 
the USDOC relied upon its finding o f non-cooperation, whether it considered any other facts besides 
the finding of non -cooperation,  whether and how the replacement facts  selected  were "adverse",  
and, whether, as alleged by Korea, it did not engage in further reasoning required to select 
"reasonable replacement s" for the missing "necessary" information in the particular circumstances 
of each case.1948 In our view, Korea 's identification of the specific unwritten measure at issue 
necessitates these lines of inquiry. For these reasons, we find that the database of 
319 determinations provided by Korea is, in and of itself, insufficient to establish the existence of 
the unwritt en measure with the precise content alleged by it.  
In light of these limitations in Korea 's discussion of the 319  determinations, we also remain 
cautious in relying upon Korea 's analysis of a limited subset of these cases. We note, for example, 
that Korea narrows its list of 319  determinations to focus on a subset of 90  determinations in which 
it alleges there was "at least a partial response by the interested parties to the information requests 
(i.e. not a complete failure to cooperate)".1949 In doing so, Ko rea explains that "it seeks to focus on 
the most egregious situation  where the use of AFA as a Norm or as part of Ongoing Conduct is in 
any case not consistent with the relevant WTO obligations of the United  States ".1950 Then, without 
any further discussion or analysis of these 90  determinations, Korea concludes that, "[i]n all of these 
90 cases, the USDOC applied AFA in a mechanistic manner solely based on the finding that party 
failed to cooperate to the best of its ability and without engaging in the requi red comparative process 
of reasoning and evaluation and an assessment of the available facts on the record to identify the 
facts that lead to an accurate determination".1951  
First, without a fuller analysis of the 319  determinations – which is rendered impo ssible in 
light of the cursory way in which Korea discusses them – it is difficult for the Panel to assess whether 
and how the 90  determinations that are short -listed by Korea reflect the "most egregious situation" 
as well as the utility of such a distinct ion when challenging "as such" an unwritten measure that is 
described as having a general and prospective nature.1952 Moreover, focusing on a subset of 
determinations in this manner still does not speak to the precise circumstances of each of the 
90 determin ations beyond what is contained in Korea 's original database. In particular, the Panel 
remains unable to determine whether, in each of the 90  determinations, the USDOC used "adverse 
inferences" or "adverse facts available" in the sense that Korea describes  the precise content of 
these terms.  
 
1947 Emphasis added.  
1948 See also Appellate  Body Report, US – Anti-Dumping Methodologies (China) , para.  5.178.  
1949 Korea's  opening statement at the first meeting of the Panel, para.  144.  
1950 Korea's  first written submission, para . 1016. (emphasis added)  
1951 Korea's  first written submission, para.  1017.  
1952 See also United  States'  second written submission, para. 191.  WT/DS539/ R 
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As part of demonstrating the precise content of the alleged unwritten measure, Korea also 
presents a table "reflect[ing]" the "specific statements contained in the 12 proceedings" that it 
focuses on.1953 Korea 's discussio n of these 12 cases in the context of the first step of establishing 
the existence  of the measure is therefore somewhat limited in this manner. By contrast, Korea 
addresses these 12  proceedings in considerably greater detail as part of the second step of t he 
analysis which seeks to demonstrate that the unwritten measure breaches  Article  6.8 and Annex  II 
of the Anti -Dumping  Agreement  and Article  12.7 of the SCM  Agreement .1954  
Even if we were to agree with Korea and find that the 12 cases discussed in greater detail 
reflect the precise content of the alleged unwritten measure  that is identified by Korea , it remains 
unclear as to how this conclusion in respect of a limited number of investigations can be used to 
arrive at a similar finding for the many o ther determinations in which the USDOC allegedly used 
"adverse facts available" but for which Korea provides very limited information. Given the overall 
approach adopted by Korea, we therefore see merit in the United  States'  argument that 
"[i]dentifying 12  determinations, out of hundreds that Korea itself cites, simply cannot support the 
existence of some sort of unwritten measure of general and prospective application" .1955 
In any event, we do not consider that all of the 12 cases discussed by Korea unequivo cally 
demonstrate the precise content of alleged unwritten measure. For example, in Heavy walled 
rectangular welded carbon steel pipes and tubes  from Turkey , the USDOC found numerous 
discrepancies in the respondent MMZ 's reporting of certain information, i ncluding, production 
quantities, general and administrative  expenses, financial expenses, indirect selling expenses, 
CONNUMs, and per -unit product weight for home market sale s.1956 In applying "partial AFA", the 
USDOC selected the highest  transaction -specifi c margin of the cooperating respondent 
(Özdemir ) and applied it to the non -cooperating respondent (MMZ).1957 In doing so, the USDOC 
explained that:  
While petition rates are permissible as adverse rates in some instances, it is not 
appropriate to use any of t he petition rates here because the [USDOC]  is unable to 
corroborate them.  Therefore, based on record evidence, the [USDOC]  has assigned to 
MMZ as AFA the highest transaction -specific margin, 35.66 percent, of the cooperating 
company, Ozdemir. It is unnecessary to corroborate this rate because it was obtained 
in the course of this investigation and, therefore, is not secondary information. The 
transaction underlying this dumpin g margin is neither unusual in terms of transaction 
quantities nor otherwise atypical .1958 
In our view, the above analysis by the USDOC suggests that, in selecting the replacement 
facts, it engaged in some reasoning and evaluation. Specifically, the USDOC di d not consider it 
"appropriate" to select the dumping margins in the petition, which were "facts" that were otherwise 
available to it, precisely because it was "unable to corroborate them". Moreover, in selecting the 
highest transaction -specific margin fro m the cooperating respondent, the USDOC explained that the 
"transaction underlying this dumping margin is neither unusual in terms of transaction quantities 
nor otherwise atypical".  
In response to questioning by the Panel on this issue, Korea explained tha t the "mere fact 
that the USDOC did not opt for the 'worst ' information such as in this case the highest margin from 
the petition is not determinative. The mechanistic application of a particular practice of selecting 
margins that ensure an adverse result and the failure to engage in a process of reasoning and 
evaluation are key ".1959 Noting that the USDOC "expressly rejected the need to corroborate the 
information it selected because it was obtained in the course of the investigation and thus allegedly 
did not constitute 'secondary ' information", Korea also points out that "the information from another 
producer [i.e. Özdemir] is clearly 'secondary ' source information for the exporter to which AFA is 
applied" .1960 Finally, Korea submits that "the lack of 'corrob oration ' to support the use of the highest 
 
1953 Korea's  first written submission, paras.  922 and 919.  
1954 Korea's  first written submission, paras.  1022-1032; Analysis  of USDOC cases, (Exhibit  KOR-217).  
1955 United  States'  first written submission, para.  483. 
1956 Heavy welded steel final determination, (Exhibit  KOR-163), pp.  9-11. 
1957 Heavy welded steel final determination, (Exhibit  KOR-163), p.  6.  
1958 Heavy welded steel final determination, (Exhibit  KOR-163), pp.  6-7. (fns omitted; emphasis added)  
1959 Korea's  response to Panel question No.  107, para.  163. (emphasis added)  
1960 Korea's  response to Panel question No.  107, para.  164. WT/DS539/ R 
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  petition margin … was in fact only a reference to the kind of meaningless 'corroboration ' of checking 
for anomalies ".1961 
Far from establishing that the USDOC 's conduct in this investigation reflects the precise 
content of the alleged unwritten measure, we consider that Korea 's responses to the 
Panel 's questions highlight the problem with losing sight of the alleged unwritten measure identified 
by Korea and the "as such" basis of its challenge. According to the measu re identified by Korea, the 
USDOC selects facts adverse to the interests of the non -cooperating party based  solely  on a finding 
of non -cooperation. Yet, the USDOC 's analysis in this case shows that its selection of the 
replacement information was not based solely on its finding of non -cooperation, but was also 
influenced by its inability to corroborate the margin in the petition. The USDOC also observed that 
the "transaction underlying this dumping margin is neither unusual in terms of transaction quan tities 
nor otherwise atypical".  
Insofar as Korea considers the USDOC 's "mechanistic application of a particular practice of 
selecting margins" to be the "key", we note that this is not the specific unwritten measure identified 
by Korea, which hinges, in K orea's own words, upon the "automatic link" between the finding of 
non-cooperation and the selection of "adverse facts available". Furthermore, Korea also appears to 
take issue with the USDOC 's finding that the information from another producer is not "sec ondary" 
and therefore does not need to be "corroborated"; for Korea, this "clearly" constitutes secondary 
source information. This raises the important question of what constitutes "information from a 
secondary source" within the meaning of paragraph  7 of Annex  II to the Anti -Dumping  Agreement . 
However, elsewhere in its responses, Korea also expressly "agrees with the United  States  that the 
Panel does not need to come up with a general definition of the term 'secondary source ' information" 
in interpreting paragraph  7 of Annex  II.1962  
To be clear, this is not to say that the points raised by Korea in its responses are unimportant 
or that the USDOC 's conduct in this particular instance was WTO -consistent. To the contrary, it is 
precisely because these issues – relating to the nature of the USDOC 's reasoning, the definition of a 
"secondary source", and the proper scope of "corroboration"  – are extremely important , that they 
should be the subject of an "as applied" claim, or, an "as such" claim against a different  unwritten 
measure , if such a measure were to exist. For purposes of Korea 's present "as such" claim, we simply 
cannot find, as a matter of fact, that the USDOC in Heavy walled rectangular welded carbon steel 
pipes and tubes from Turkey  selected the replac ement facts based solely  on its finding of 
non-cooperation . To the extent that Korea takes issue with the "kind of evaluation" provided by the 
USDOC as falling short of what is required under Article  6.8 and Annex  II, we address this in 
section  7.4.5.3  below.  
Another case that Korea discusses as part of its "representative sample" of 12 cases is 
Certain carbon and alloy steel cut -to-length plate from France . In that case, the USDOC found that 
the respondent Industeel had:  
(1) [M]isreported the product characteristics for chromium and nickel content for a 
significant percentage of its home market and U.S. sales, as well as in the costs for 
these products; (2 ) made numerous errors in the data reported in numerous expense 
fields f or the home market and U.S. sales examined at verification; and (3 ) failed to 
include certain production orders, including certain orders for abrasion products, when 
weight averaging its costs by CONNUM.1963 
Having found that the respondent did not act to th e best of its ability, the USDOC applied 
"total AFA" and "assigned Industeel the highest margin contained in the petition of 
148.02  percent".1964 In doing so, the USDOC "corroborated the petition rate using transaction 
specific margins from the mandatory res pondent Dillinger France, which were not calculated using 
total AFA".1965 Furthermore, the USDOC found that that the "petition margin falls within the range 
 
1961 Korea's  response to Panel question No.  107, para. 165. (emphasis added)  
1962 Korea's  comments on United  States'  response to Panel question No.  52, p.  13. 
1963 Alloy steel final determination, (Exhibit  KOR-160), p.  33. 
1964 Alloy steel final determination, (Exhibit  KOR-160), p.  6.  
1965 Alloy steel final determi nation, (Exhibit  KOR-160), p.  6. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  of the highest transaction -specific margins calculated for Dillinger France, which appear to be sales 
whose terms were normal, when compared with other sales in Dillinger France 's database".1966 
In response to questioning by the Panel, Korea asserts that the USDOC 's reasoning is "not 
the kind of evaluation of the available facts on the record with a vi ew to making an accurate 
determination that is required by Article  6.8 and Annex  II of the Anti -Dumping  Agreement ".1967 
Furthermore, Korea contends that the kind of "corroboration" undertaken by the USDOC falls short 
of what is required under the covered agr eement s.1968 Again, while we consider the issues raised by 
Korea to be important, our task is limited to determining whether the USDOC selected facts 
"adverse" to the interests of the non -cooperating  respondent  based  solely  on its finding of 
non-cooperation.  For this purpose, as a factual matter, it is clear that, in selecting the petition 
margin, the USDOC engaged in an exercise of corroboration and also noted that the margins from 
another mandatory respondent were from "sales whose terms were normal, when c ompared with 
other sales in Dillinger France 's database". Therefore, we simply cannot find, as a matter of fact, 
that the USDOC in this instance selected the replacement facts  based solely on its finding of 
non-cooperation and nothing else. In our view, th is case does not reflect the precise content of the 
unwritten measure identified by Korea. To the extent that Korea takes issue with the "kind of 
evaluation" provided by the USDOC as falling short of what is required under Article  6.8 and 
Annex  II, we addr ess this in section  7.4.5.3  below.  
The United  States  also offers several counterexamples to demonstrate that, contrary to 
Korea 's arguments, whenever it makes a finding of non -cooperation, the USDOC does not always 
adopt "adverse inferences" and fail to engage in any further evaluation.1969 The United  States  
submits that, in Stainless steel b ar from Italy , the USDOC found that the respondent failed to 
cooperate to the best of its ability, however, it did not draw adverse inferences and instead "relied 
on other information on the record that allowed it to accur ately calculate the subsidy rate" .1970  
Korea stresses, first, that "[ t]his case concerns a CVD proceeding from 2002, thus well 
before the adoption of the TPEA amendment [] to Section 776 in 2015" .1971 We note in this regard 
Korea 's argument that the "unwritten measure … has existed for much longer" than the 
2015 TPEA Amendment.1972 We also note that Korea cites several US court rulings that pre -date the 
2015 TPEA Amendment for purposes of demonstrating the existence of the alleged unwritten 
measure.1973 In these circumstances, it is not entirely clear to us as to why Korea considers any less 
relevant the evidence from the same period that United  States'  relies upon.  
Second, Korea submits that the USDOC in that case actually applied "adverse fa cts available" 
and "[t]he only issue was … was which information to use as AFA".1974 As discussed, however, the 
exact meaning that Korea ascribes to the term "adverse facts available" relates precisely to "which 
information to use as AFA" and is therefore an  important feature of the precise content of the alleged 
unwritten measure. In Stainless steel ba r from Italy , the USDOC found that the respondent, CAS, 
"did not act to the best of its ability".1975 The petitioners argued that "the rate calculated in a previ ous 
proceeding represents a proper starting point for the [USDOC] 's construction of a facts available 
rate".1976 Disagreeing with the petitioners, the USDOC instead used information provided by the 
Government of Italy and the European Commission because it a llowed the USDOC "to calculate a 
 
1966 Alloy steel final determination, (Exhibit  KOR-160), p.  6. 
1967 Korea's  response to Panel question No.  109, para.  175. 
1968 Korea's  response to Panel question No.  109, para.  176. 
1969 United States' second written submission, paras . 155-164 and 169 -70; opening statement at the 
first meeting of the Panel, paras. 70 -73; and opening statement at the second meeting of the Panel, 
paras.  98-101. 
1970 United States' second written submission, para.  157 (referring to Stainless steel bar from I taly, 
issues and decision memorandum, (Exhibit USA -62)). 
1971 Korea's  second written submission, para.  389. 
1972 Korea's  response to Panel question No.  40(a).  
1973 Korea's  first written submission, para.  921 (referring to, inter alia , Essar Steel Ltd. v. United  States , 
(Exhibit  KOR-175), p.  1373; De Cecco Di Filippo Fara. S. Martino v. United  States , (Exhibit  KOR-176), p.  1032; 
and Lifestyle Enterprise, Inc. v Unite d States , (Exhibit  KOR-178), p.  1298).  
1974 Korea's  second written submission, para.  389. 
1975 Stainless steel bar from Italy, issues and decision memorandum, (Exhibit USA -62), p.  16. 
1976 Stainless steel bar from Italy, issues and decision memorandum, (Exhibit USA -62), p.  15. WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  more precise subsidy rate for the POI".1977 Thus, this example offered by the United  States  does not 
support the existence of the unwritten measure with the precise content alleged by Korea.  
Korea offers a similar response to  the United  States'  reliance upon Non-oriented electrical 
steel from Chinese Taipei . Korea submits that it "pre -dates the TPEA amendment []" and "the USDOC 
applied AFA to an exporter in relation to several programs for its failure to cooperate and the only 
issue related to the selection of AFA" .1978 For reasons discussed above, we remain unconvinced that 
cases pre -dating the 2015 TPEA Amendment cannot be offered as evidence challenging the existence 
of the alleged unwritten measure, particularly when Korea itself cites court rulings from that period. 
Moreover, we note that the USDOC 's determination contains standard "boilerplate" language relating 
to the use of "adverse inferences" that Korea places great significance upon as part of its own 
database o f the USDOC 's alleged practice.1979 The USDOC clearly made a finding of non -cooperation 
and found that the non -cooperating party "did not respond to the … countervailing duty 
questionnaires, even after asking, and receiving an extension for time to respond".1980 For the 
"alleged income tax programs pertaining to either the reduction or exemption of the income tax 
rates or payment of no income tax", the USDOC thus applied an "adverse inference that the 
non-cooperating mandatory respondent paid no income tax duri ng the POI". The USDOC explained 
that, "under this approach, the highest possible benefit for income tax programs is equal to the 
standard income tax rate in the country at issue. In the instant case, the standard income tax rate 
for corporations in [Chine se Taipei] is 17 percent" . However, the USDOC did not select this rate 
"because the [foreign authority] placed [the non -cooperating party's] tax returns on the record of 
this investigation" and it therefore used these returns for purposes of its AFA analys is. Thus, using 
the other information properly available to it, the USDOC determined that the respondent "did not 
use any tax exemptions or reductions at issue in this CVD investigation" and thus the USDOC  did 
not assign a subsidy rate for these programmes .1981 In our view, therefore, the USDOC clearly  did 
not select the more "adverse" replacement fact based solely upon its finding of non -cooperation.  
The United  States  also refers to Welded line pipe from Korea , asserting that the USDOC in 
that case "discovered at verification several unreported subsidies, including exemptions from the 
local education tax", but it used facts available without an adverse inference.1982 Korea responds 
that "the USDOC did not make a finding of non -cooperation and the case is thus not applicable to 
the claim of Korea that each time a finding of non -cooperation is made, AFA is applied".1983 We note , 
however , that the USDOC stated that because the respondent " failed to provide information on this 
exemption [of local education ta x] by the deadline" it "relied on the facts available".1984 
The petitioner in that case urged the USDOC to use the rate calculated in another proceeding, "which 
is the highest rate calculated in any Korean case for such a program".1985 The USDOC disagreed and 
instead used information provided by the Government of Korea in its initial questionnaire response 
as the replacement for the missing information.1986 Therefore, we agree with the United  States  that 
this case undermines the "automatic link" between a finding  of non -cooperation and the selection of 
facts that are adverse to the interests of the non -cooperating party that is an important feature of 
the precise content of the alleged unwritten measure.  
The nature of an "as such" claim  
We recall that "as such" cl aims are "serious challenges" and their implications "are obviously 
more far -reaching than 'as applied ' claims" as they seek to prevent Members ex ante from engaging 
in certain conduct.1987 We agree in this regard that, "[b]y definition, an 'as such ' claim c hallenges 
 
1977 Stainless steel bar from Italy, issues and decision memorandum, (Exhibit USA -62), p.  17. 
1978 Korea's  opening statement at second meeting of the Panel, para.  104. 
1979 Non-oriented electrical steel from Chinese Taipei, issues and decision memorand um, 
(Exhibit  USA-91), pp.  10-11.  
1980 Non-oriented electrical steel from Chinese Taipei, issues and decision memorandum,  
(Exhibit  USA-91), p.  9.  
1981 Non-oriented electrical steel from Chinese Taipei, issues and decision memorandum,  
(Exhibit  USA-91), p.  11.  
1982 United States' second written submission, para.  161. 
1983 Korea's  opening statement at second meeting of the Panel, para.  104. 
1984 Welded line pipe from Korea, issues and decision memorandum, (Exhibit  USA-90), p.  35. 
1985 Welded line pipe from Korea, issues and d ecision memorandum, (Exhibit  USA-90), p.  33.  
1986 Welded line pipe from Korea, issues and decision memorandum, (Exhibit  USA-90), pp.  34-35. 
1987 Appellate  Body Report, US – Oil Country Tubular Goods Sunset Reviews , para.  172. See also 
para. 7.608  above.  WT/DS539/ R 
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  [measures] that have general and prospective application, asserting that a Member 's conduct  – not 
only in a particular instance that has occurred, but in future situations as well  – will necessarily be 
inconsistent with that Member 's WTO obligati ons".1988  
With respect to the alleged unwritten measure at issue, we note that Korea does not 
challenge the written legislation setting out the discretion available to the USDOC in its selection of 
the replacement facts. Rather, the alleged unwritten measure concern s the exercise  of that 
discretion in a WTO -inconsistent manner by the USDOC. Korea thus needs to demonstrate that the 
alleged unwritten measure cannot lead to a WTO -consistent selection of replacement facts  and that 
it necessarily entails a WTO -inconsisten t selection of the replacement facts in future situations, 
irrespective  of the particular circumstances of individual investigations. As Korea asserts, "[t]he AFA 
Rule or Norm, or the AFA Ongoing Conduct, does not take 'differences in the factual circumsta nces 
of the situation into account '".1989 Any other approach risks rendering the alleged unwritten 
measure 's WTO-consistency dependent upon the circumstances, which requires a case -by-case 
assessment of the kind that is required for "as applied" claims of WT O-inconsistency.  
To establish that the alleged unwritten measure necessarily results in the WTO -inconsistent 
conduct, Korea stresses the "automatic link" between the USDOC 's finding of non -cooperation and 
its use of "adverse inferences". As discussed abov e, under the alleged unwritten measure, the 
USDOC selects replacement facts that are adverse to the interests of the non -cooperati ng party 
based solely upon its finding of non -cooperation . Specifically, Korea submits that the USDOC, in 
using "adverse facts  available" in this manner, does not take into account the procedural 
circumstances of non -cooperation and does not engage in a "comparative evaluation" with a view to 
selecting the "best information available" in the particular circumstances.   
We recall that Article  6.8 requires investigating authorities to select reasonable replacements 
for the missing "necessary" information in a given case.1990 Together with Annex  II, the provision 
prescribes in considerable detail an investigating authority 's conduct in selecting reasonable 
replacement s in the particular circumstances of a given investigation. While the search for 
reasonable  replacements requires an investigating authority to exercise its judgment and consider 
all the facts that are  properly available to it as well as the procedural circumstances of 
non-cooperation, the nature and extent of the evaluation and analysis that are required on the part 
of the investigating authority depend inevitably upon the particular facts and circumst ances, 
including the "necessary" information that was found to be missing, the circumstances surrounding 
non-cooperation, as well as the facts that are otherwise available to it. As discussed in our 
interpretative analysis, we disagree with Korea insofar a s it suggests that the 
Anti-Dumping  Agreement  and the SCM  Agreement  always require a certain kind of "comparative 
evaluation" in all circumstances.  
Korea alleges that the 319 determinations show that the USDOC does not engage in a 
"comparative analysis". However , in light of  Korea 's limited discussion of each of these 
319 determinations and the fact that it does not place on the panel record a  vast majority of these 
determinations, we are unable to ascertain whether a "comparative evaluation" of the kind t hat 
Korea envisages was, in fact, required in the specific circumstances of each of the 319 investigations. 
Put differently, asserting that the USDOC did not engage in a certain kind of evaluation in the 
abstract is not enough; Korea must also demonstrate that the kind of evaluation it envisages was, 
in fact, required in light of the specific facts of each of the 319 determinations.  
Furthermore, our analysis of the representative sample of the USDOC 's determinations that 
Korea places on the record indicate s that the USDOC use of "adverse inferences" and "adverse facts 
available" is not always as "automatic" as Korea claims. We disagree with Korea that the USDOC  
selects "adverse facts available"  based solely  upon its finding of non -cooperation. As discussed 
above, contrary to Korea 's position, in many of the determinations placed on the record by the 
parties the USDOC does, in fact, engage in some  analysis and reasoning for purposes of selecting 
the replacement facts  and, therefore, the link between a finding  of non -cooperation and the adoption 
of adverse inferences and the selection of "adverse facts available" is not as "automatic" as Korea 
suggests . Insofar as Korea argues that the USDOC 's analysis in these determinations is nonetheless 
WTO-inconsistent, we  consider that such a conclusion cannot be arrived at without a case -by-case 
 
1988 Appellate  Body Report, US – Oil Country Tubular Goods Sunset Reviews , para.  172. 
1989 Korea's  second written submission, para.  419. 
1990 See para.  7.36 above.  WT/DS539/ R 
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  assessment of each instance of the USDOC 's use of "adverse facts available", thereby questioning 
the utility of Korea 's "as such" challenge  and the existence of a rule or a norm of general and 
prospective application . 
To the extent that Korea takes the position that the alleged unwritten measure comprises of 
the USDOC selecting "adverse facts available" without engaging in the kind of analysi s and 
evaluation that is required  under the covered agreements, it appears to describe the impugned 
measure  by reference to a treaty obligation . As discussed, at times – including in its responses to 
the Panel's  questions concerning the individual determin ations that it discusses – Korea asserts that 
the AFA rule or norm entails the USDOC's  failure to select the "best information available" in the 
"particular circumstances" or its failure to undertake the " required  comparative assessment" to 
arrive at an "a ccurate determination". These terms are not used by the USDOC, but are instead 
found in the covered  agreements and in WTO jurisprudence. The fact that Korea describes the 
alleged unwritten measure as comprising of the USDOC's  failure to act WTO -consistentl y by not 
undertaking the  "required"  evaluation has the important effect of blurring the line between the 
factual question of the existence of the measure and the issue of its WTO -consistency. This is 
because Korea's  unwritten measure is defined by referenc e to the USDOC engaging in 
WTO-inconsistent conduct, i.e. its failure to select the "best information available" or to undertake 
a "comparative evaluation".1991 At the same time, Korea alleges that it is for this very "reason" that 
the unwritten measure is W TO-inconsistent.1992 We agree with the Appellate  Body in this regard that 
such an approach is "flawed" and "introduce[s] uncertainty because the identification of the measure 
would vary depending on the substance of the legal provision invoked by a complaina nt and the 
interpretation that a panel might give to that provision".1993  
Conclusion regarding  the "AFA rule or norm " 
Based on our examination of the arguments and evidence, we find that Korea has not 
establish ed the existence of the unwritten "AFA rule or norm" with the precise content alleged by it. 
Given Korea 's failure to demonstrate to the precise content of the alleged unwritten measure, it is 
not necessary for us to consider whether the alleged rule or norm is attributable to the United  States  
and is of general and prospective application . 
7.4.6   Whether Korea has established the existence of the AFA ongoing conduct  with the 
precise content alleged by it  
Having found that Korea has failed to establish the existence of the unwritten "AFA rule or 
norm" , we now address Korea 's alternative characterization of the alleged unwritten measure as a 
form of "ongoing conduct" that can be challenged in WTO dispute settlement proceedings.  
The description of the unwritten measure in its panel request , as well as it s submission s to 
the Panel , suggest that Korea characterizes the same  substantive measure as a "rule or norm of 
general and prospective application", or, in the alternative, as "ongoing conduct". In its first written 
submission, for establishing the existe nce of the alleged "ongoing conduct"  measure , Korea explains 
that it "already demonstrated … the precise content" of the measure as part of its arguments on the 
existence of the "rule or norm of general and prospective application".1994 
In response to furthe r questioning by the Panel, Korea acknowledges  that, "[i]n terms of 
determining the precise content and the repeated application of AFA, the evidence is the same".1995 
Thus, not only does Korea offer the same description for the precise contents of the alleg ed "rule or 
norm" and "ongoing conduct", but it also relies on the very same evidence to demonstrate the 
existence of both kinds of measures. The only reason offered by Korea to present such distinct 
 
1991 See Korea's request for interim review, para. 73 (identifying the alleged unwritten measure as 
follows: "whenever there is a finding of non -cooperation, the USDO C will use adverse facts to fill the alleged 
gap, which, in turn, means that it will not engage in the required search  for reasonable replacements for the 
missing information" (emphasis added) ). 
1992 Korea's request for interim review, para. 74 (explaining th at "[t]he reason why the use of AFA 
(i.e. the challenged measure) violates  the Anti -Dumping and the SCM Agreement[s] is because it involves a 
wholly inadequate evaluation " (emphasis added)).  
1993 Appellate  Body Report, EC – Selected Customs Matters , para.  132. 
1994 Korea's  first written submission, para.  944. 
1995 Korea's  response to Panel question No.  47. WT/DS539/ R 
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  characterizations is that "both types of measures have t heir own conditions that must be 
demonstrated to exist".1996  
While many different kinds of measures  have been challenged by complainants in previous 
disputes  – including, inter alia , a "rule or norm"1997 and "ongoing conduct"1998 – nothing in the treaty 
text di stinguishes different measures in this manner. Generally speaking, we agree with the 
Appellate  Body that "[t]hese distinctions are not always useful or appropriate to define the elements 
that must be substantiated for purposes of proving the existence and nature of a measure at 
issue".1999 Instead, as discussed, the additional elements that must be demonstrated to establish 
the existence of an unwritten measure are to be ascertained in light of the specific measure 
challenged and how it is described by a comp lainant in a given case. Rather than  focusing on the 
elements necessary to establish the existence of different kinds of measures in the abstract, our 
task is better served by examining the  precise description of the specific measure offered by Korea 
with a view to ascertaining the elements that it must demonstrate.  
According to the description in Korea 's panel request, the unwritten measure exists 
"whenever  the USDOC makes a finding that a producer or exporter has failed to cooperate by not 
acting to the best of its ability".2000 This suggests that Korea, in fact, seeks to prevent the 
United  States  from engaging in the alleged conduct in general and in the future . This is also 
consistent with the fact that Korea 's challenge is made on an "as such" basis, because, "[b]y 
definition,  an 'as such ' claim challenges [measures] that have general and prospective 
application".2001 Nothing in Korea 's description suggest s that the measure does not cover all imports 
into the United States  from all countries.2002 Nor does the description offered by Korea limit the 
scope of the measure to certain finite number of investigations or a determinate group of cases  or 
proceedings . Rather , Korea recognizes  that "the AFA Rule or Norm, or AFA Ongoing Conduct , applies 
to an unidentified number of economic operators and in a broad range of situations  or cases".2003 
The measure described by Korea is also markedly different from the measures 
previously  challenged as "ongoing conduct" in US – Continue d Zeroing and US – Orange 
Juice (Brazil) . In US – Continued Zeroing , the European Communities challenged two sets of 
measures  (a) the continued application of duties resulting from 18  anti-dumping duty orders, as 
calculated or maintained in the most recent  proceeding, at the time of the challenge; and (b ) the 
use of the zeroing methodology in anti -dumping proceedings pertaining to the duties resulting from 
these 18 anti -dumping duty orders (including original investigations, periodic reviews, and sunset 
reviews).2004 The Appellate  Body noted that the European Communities ' claims against the measures 
at issue could neither be characterized as a challenge to the measures "as such", nor as a challenge 
to these measures "as applied" , and explained as follows:  
The European Communities ' claim regarding these measures is not an "as such" claim, 
in that its scope is narrower than a challenge to the zeroing methodology as a rule or 
norm of general and prospective application with regard to  all imports into the 
United  States  from all countries. At the same time, the measures at issue are broader 
than specific instances in which the zeroing methodology was applied, such as a periodic 
review or sunset review determination. In other words, the measures at issue consist 
of the use of the zeroing methodology in a string of connected and sequential 
determinations, in each of the 18 cases, by which the duties are maintained. As the 
European  Communities explains, its complaint is directed at "the zer oing methodology 
as used in the final order and programmed to continue to be used until such time as the 
 
1996 Korea's  response to Panel question No.  47. 
1997 Appellate  Body Report, US – Zeroing (EC) , paras.  192-194. 
1998 Appellate  Body Report, US – Continued Zeroing , para.  181. 
1999 Appellate  Body Report, Argentina – Import Measures , para.  5.109. See also Appellate Body Report, 
US – Continued Zeroing , para.  179. 
2000 Emphasis added.  
2001 Appellate  Body Report, US – Oil Country Tubular Goods Sunset Reviews , para.  172. 
2002 This is further confirmed by annex I of Korea's  panel request,  which sets out a "preliminary and 
non-exhaustive list" of USDOC investigations that, in Korea's  view, establish the existence of the unwritten 
measure and illustrates the USDOC's  practice. (Ko rea's panel request, fn  1 and annex I). The proceedings 
listed in annex I concern a wide -range of products that are imported from many different countries.  
2003 Korea's  second written submission, para.  379. (emphasis added)  
2004 Appellate  Body Report, US – Continued Zeroing , para.  164. WT/DS539/ R 
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  United  States  eliminates zeroing from the particular anti -dumping duty under 
consideration.2005 
The Appellate  Body explained that the "successive determi nations by which duties are 
maintained are connected stages in each of the 18 cases involving imposition, assessment, and 
collection of duties under the same anti -dumping duty order".2006 For the Appellate  Body, the "use 
of the zeroing methodology in a strin g of these stages [was] the allegedly unchanged component of 
each of the 18  measures at issue"2007 and it was "with respect to this ongoing conduct that the 
European  Communities brought its challenge, seeking its cessation".2008 Notably , the Appellate  Body 
considered that the European Communities ' claim against "ongoing conduct" "is not an 'as 
such' claim".2009 
In US – Orange Juice (Brazil) , Brazil challenged the "continued use by the United  States  of 
zeroing procedures in successive anti -dumping proceedings unde r the Orange Juice Order, including 
the original investigation and any subsequent administrative reviews by which duties are applied 
and maintained over a period of time" .2010 The United  States  claimed that the "ongoing conduct " 
challenged by Brazil was not susceptible to a WTO  challenge because it was based on "an indefinite 
number of future individual measures that do not and may never exist".2011 In response to the 
United  States'  argument, the panel observed that "ongoing conduc t may be simply described as 
conduct that is currently taking place and is likely to continue  in the future".2012 The panel explained 
that: 
[I]mplicit in the United  States'  argument is the view that there is a prospective element 
to the alleged "ongoing cond uct" "measure" Brazil challenges which cannot be 
established with any degree of certainty because it is inherently speculative. We note, 
however, that although describing the "ongoing conduct" measure in US – Continued 
Zeroing  in terms that contemplate its  prospective operation, the Appellate  Body did not 
require absolute certainty as to the future conduct it envisaged.  
… 
Thus, ongoing conduct may be simply described as conduct that is currently taking place 
and is likely to continue  in the future.2013 
In thi s regard, we also note the Appellate  Body's explanation that, "in addition to attribution 
to a WTO Member and precise content … [a] complainant that is challenging a measure characterized 
as 'ongoing conduct ' would need to provide evidence of its repeated application, and of the likelihood 
that such conduct will continue".2014 In both US – Continued Zeroing and US – Orange Juice (Brazil) , 
the measures challenged as "ongoing conduct" thus exuded a certain prospective character, but 
were not of general applicat ion and were, instead, limited to certain finite or determinate number of 
(connected ) proceedings  or instances .  
In contrast to the measures challenged in these prior disputes, Korea 's description of the 
measure at hand is broadly -worded and is not limited  to certain finite number of proceedings or 
narrow set of circumstances. Korea does not characterize the alleged unwritten measure as "ongoing 
conduct" to challenge the use of "adverse facts available" by the USDOC in connected segments of 
a determinate nu mber of investigations, such as, for example, the investigations challenged in this 
dispute on an "as applied" basis. Rather, the unwritten measure allegedly prevents the USDOC from 
engaging in WTO -consistent conduct in general and in the future . Consisten t with the "as such" 
 
2005 Appellate  Body Report, US – Continued Zeroing , para.  180. (fns omitted)  
2006 Appellate  Body Report, US – Continued Zeroing , para.  181. 
2007 Appellate  Body Report, US – Continued Zeroing , para.  181. 
2008 Appellate  Body Report, US – Continu ed Zeroing , para.  181. 
2009 Appellate  Body Report, US – Continued Zeroing , para.  180. (fns omitted)  
2010 Panel Report, US – Orange Juice (Brazil) , para.  7.163 (quoting Brazil's  first written submission, 
para. 48). 
2011 Panel Report, US – Orange Juice (Brazil) , para . 7.174 (quoting United  States'  first written 
submission, paras.  51 and 131).  
2012 Panel Report, US – Orange Juice (Brazil) , para.  7.176. (emphasis original)  
2013 Panel report, US – Orange Juice (Brazil) , paras.  7.175 -7.176. (emphasis original)  
2014 Appellate  Body Reports, Argentina – Import Measures , para. 5.108 (referring to Appellate  Body 
Report, US – Continued Zeroing , para.  191 (fns omitted)).  WT/DS539/ R 
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  nature of Korea 's challenge , as well the manner in which it describes and demonstrates the precise 
content of the alleged unwritten measure, we consider that the alleged unwritten measure described 
by Korea is properly characterized as  a "rule or a norm" and not as "ongoing conduct".2015 
In any event, Korea acknowledges that the arguments and evidence for establishing the 
"precise content" of the "ongoing conduct" measure are the same as those presented in the context 
of the "rule or a no rm".2016 We have found above that Korea has failed to establish the existence of 
the "rule or a norm" with the precise content alleged by it. Therefore, Korea 's attempt at establishing 
the existence of the "ongoing conduct" measure also fails for the same re asons.  
The panel and the Appellate  Body in US – Supercalendered Paper appear to have shared an 
understanding of "ongoing conduct" that is substantially closer to the notion of a "rule or norm of 
general and prospective application".2017 However, as one Appellate  Body Member observed in their 
separate opinion on this issue, "[i]n this case, the Panel and the majority [went] beyond US – 
Continued Zeroing  to enhance and broaden the concept of 'ongoing conduct ' into something akin to 
a 'rule  or norm of general and prospective application', only vaguer and less disciplined in its 
requirements".2018 We agree with this observation and consider that Korea 's description and 
characterization of the alleged unwritten measure in this case serves to cau tion against a mechanistic 
and rigid application of these notions.  
We note Korea 's argument that , "[i]n the context of its AFA Ongoing Conduct, the USDOC 
applies several specific methodologies for selecting AFA from among facts available in its 
anti-dumpin g and countervailing duty proceedings in case a particular factual situation arises".2019 
Specifically, Korea identifies three "methodologies". First, under the "Total AFA – Highest Dumping 
Margin" methodology, Korea alleges that the "USDOC has a practice of  selecting, as an AFA rate, 
the higher of (1 ) the highest dumping margin alleged in the petition, or (2 ) the highest calculated 
dumping margin of any respondent in the investigation" .2020 In support, Korea references six USDOC 
determinations. Second, under t he "Expenses AFA – Highest / Lowest Expenses" methodology, Korea 
alleges that "in a situation where the allegedly missing information concerns expenses, the USDOC 
maintains a specific ongoing conduct of applying an adverse inference, as it has a standard 
'practice ' of selecting as AFA the lowest expenses for home -market sales and the highest expenses 
for export sales, so that the normal value is increased as high as possible and the export price is 
reduced as low as possible" .2021 Korea refers to five investigations as reflecting this specific 
"methodology". Finally, under the "Subsidy Program – Highest Rates AFA" methodology, Korea 
contends that, "if the allegedly missing information requires resort to AFA for a particular subsidy  
program, the USDOC has a practice of computing the AFA by using the highest calculated 
program -specific rates determined for a cooperating respondent in the same investigation, or, if not 
available, rates calculated in prior CVD cases involving the same c ountry" .2022 Korea identifies nine 
investigations as embodying this methodology.  
Korea  acknowledg es that the three "methodologies"  that it  identifie s "are triggered in 
particular circumstances " and are "clear examples  of the United  States'  AFA Ongoing Conduct".2023 
However, the alleged unwritten measure identified by Korea is not limited to "particular 
circumstances" or  to a limited number of investigations. Instead, the alleged unwritten measure is 
very broad in scope and exists "whenever the USD OC makes a finding non -cooperation".2024 
Moreover, the alleged unwritten measure identified by Korea is not described in terms of these 
specific "methodologies ". In these circumstances, it is not clear to us – and, importantly,  Korea does 
 
2015 We note, in this regard, Korea's  argument that the manner in which Korea's  panel request identifies 
the unwritten mea sure at issue "is also how the measure was identified in" US – Anti-Dumping Methodologies 
(China) . (Korea's  response to Panel question No.  104, para.  129 (quoting US – Anti-Dumping Methodologies 
(China) , China's  panel request, p.  4)). While we see some imp ortant differences between the unwritten 
measures at issue in these two disputes, we nonetheless note that the Appellate  Body in US – Anti-Dumping 
Methodologies (China)  ultimately found that the measure identified was a "rule or norm of general and 
prospec tive application". (Appellate  Body Report, US – Anti-Dumping Methodologies (China) , para.  5.183).  
2016 Korea's  first written submission, para.  944. 
2017 See, e.g. Appellate  Body Report, US – Supercalendered Paper , para.  5.29. 
2018 Appellate  Body Report, US – Superc alendered Paper , para.  5.86. 
2019 Korea's  first written submission, para.  947. 
2020 Korea's  first written submission, para.  950. 
2021 Korea's  first written submission, para.  952. 
2022 Korea's  first written submission, para.  954. 
2023 Korea's  first written submission, para.  948. (emphasis added)  
2024 Korea's  panel request, para.  9. WT/DS539/ R 
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  not explain – how t hese "examples" of the USDOC 's conduct in "particular circumstances" 
demonstrate the existence of the unwritten measure with the precise content alleged by Korea. 
Given this important limitation, we do not consider it necessary to examine whether Korea has  
demonstrated the existence of the three alleged "methodologies".  
For the above reasons, we find that the alleged unwritten measure challenged on an "as 
such" basis by Korea is properly characterized as a "rule or a norm  of general and prospective 
applicat ion" and not as "ongoing conduct". In any event, given that Korea 's arguments and evidence 
for establishing the "precise content" of the "ongoing conduct" measure are the same as those 
presented in the context of the "rule or a norm", Korea 's attempt at es tablishing the existence of 
the "ongoing conduct" measure also fails in light of our finding that Korea has failed to establish the 
existence of the "rule or a norm" with the precise content alleged by it.  
7.4.7   Overall conclusion  
As the complainant challenging  an unwritten measure on an "as such" basis, Korea bears 
the burden of establishing the existence as well as the WTO -inconsistency of the measure with the 
precise content alleged by it. As indicated in our preliminary ruling, the only alleged unwritten 
measure that is within the Panel 's terms of reference is the one identified in Section I.C of 
Korea 's panel request. Korea characterizes the alleged unwritten measure as a "rule or a norm" of 
general and prospective application or, in the alternative, as a fo rm of "ongoing conduct". Mindful of 
avoiding an overly rigid application of labels that do not find a basis in the treaty text, we consider 
that, ultimately, the specific elements that must be substantiated with arguments and evidence in 
order to prove the  existence of the impugned measure are informed by how a complainant describes 
and characterizes the unwritten measure alleged to exist  in a given case. In the case at hand, the 
measure described by Korea is of general and prospective application and is th erefore more akin to 
a "rule or a norm" than to a form of "ongoing conduct". In any event, we note that Korea offers the 
same description and substantially similar arguments and evidence for establishing the existence of 
the "ongoing conduct" measure as it  does for demonstrating the existence of a "rule or a norm".  
As to its precise content, Korea identifies several interlinked aspects that, working together, 
constitute the alleged unwritten measure. The first aspect serves as the trigger for the 
WTO-incon sistent action and consists of a finding of non -cooperation  being made  by the USDOC. 
The subsequent aspect s concern the consequences that follow the trigger and comprise of the 
USDOC adopting "adverse inferences" and selecting "adverse facts available". As to the precise 
meaning of these terms, Korea explains that the USDOC adopts "adverse inferences" and selec ts 
replacement facts that are "adverse" to the interests of the non -cooperating party, without 
establishing (i)  that such inferences can reasonably be drawn in light of the "degree of cooperation" 
received, and (ii)  that such facts are the "best informatio n available"  in the particular circumstances. 
Korea therefore defines the precise content of the alleged unwritten measure by reference to both 
what the USDOC does (a finding of non -cooperation and the adoption of "adverse inferences" and 
selection of "adv erse facts available"), as well as what the USDOC does not do ( i.e., the precise 
meaning that Korea ascribes to "adverse inferences" and "adverse facts available"). We consider 
these positive and negative aspects of the USDOC 's conduct to be an important f eature of the precise 
content of the alleged unwritten measure because, according to Korea, the existence of the measure 
is predicated upon the "automatic" link between a finding of non -cooperation and the adoption of 
"adverse inferences" and the selection  of "adverse facts available".  
We disagree with Korea that several prior WTO disputes confirm the existence of the alleged 
unwritten measure at issue in this case because the precise content of the alleged unwritten measure 
identified by Korea in these pro ceedings  is different from that of the measures challenged in prior 
WTO disputes. Moreover, the evidence that Korea adduces is also not exactly the same as what was 
examined in the past disputes that Korea cites. Turning to the different kinds of evidence that 
Korea  presents to establish the existence of the alleged unwritten measure, we note the 
various  permissive aspects of the written legislation that Korea highlights (Section 776 of the 
Tariff Act (19 U.S.C 1677 (e))  as modified by the 2015 TPEA Amendme nt) as embodying the "written 
permission" for the alleged unwritten norm. However, we find nothing in the statutory text to suggest 
that the provision somehow "codifies" the "existing practice" of the USDOC or shows how frequently 
the discretion available thereunder to the USDOC is actually exercised in a WTO -inconsistent 
manner.  WT/DS539/ R 
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Turning to the USDOC 's Anti-Dumping Manual and the US court rulings that Korea refers to, 
we do not consider that the excerpts from these documents that Korea relies upon demonstr ate the 
precise content of the alleged unwritten measure. For example, the USDOC 's Anti-Dumping Manual 
is cast in permissive language and the excerpt from the US court rulings cited by Korea suggests 
that the USDOC is required to select "reasonably accurat e" replacements for the missing information. 
As to Korea 's reliance upon the USDOC 's alleged "practice", we find that the database of 
319 determinations provided by Korea is insufficient to establish the existence of the unwritten 
measure with the precise content alleged by it and note that Korea does not discuss or place on the 
record the full text of the 319 determinations. Given the "as such" nature of Korea 's challenge and 
the general and prospective nature of the alleged unwritten norm, and in light of  the limitations in 
Korea 's discussion of the 319 determinations that it identifies, we also remain cautious in relying 
upon Korea 's analysis of a limited subset of these cases. Even if we were to agree with Korea and 
find that the few cases that it discus ses in greater detail reflect the precise content of the alleged 
unwritten measure that is identified by Korea, it remains unclear as to how this conclusion in respect 
of a limited number of determination s can be used to arrive at a similar finding for the  many other 
determinations wherein the USDOC used "adverse facts available" , but for which Korea provides 
very limited information.  
In any event, we do not consider that the USDOC 's conduct in the few cases that Korea 
discusses in greater detail always re flects the precise content of the alleged unwritten measure. 
Contrary to Korea 's position, in many of the determinations placed on the record by the parties, the 
USDOC does, in fact, engage in some  analysis and reasoning for purposes of selecting the 
replacement facts and, therefore, the link between a finding of non -cooperation and the adoption of 
adverse inferences and the selection of "adverse facts available" is not as "automatic" as Korea 
suggests. Insofar as Korea argues that the USDOC 's analysis in t hese determinations is nonetheless 
WTO-inconsistent, given our interpretation of Article  6.8 and Annex II of the Anti -Dumping 
Agreement and Article  12.7 of the SCM Agreement, we consider that such a conclusion cannot be 
arrived at without a case -by-case assessment of each instance of the USDOC 's use of "adverse facts 
available", thereby questioning the utility of Korea 's "as such" challenge and the existence of a "rule 
or a norm" of general and prospective application.  
For these reasons, we find that Kore a has failed to establish the existence of the alleged 
unwritten measure with the precise content identified by it. In these circumstances, it is not 
necessary for us to examine whether the alleged unwritten measure is inconsistent with the 
United  States' obligations under Article  6.8 and Annex II of the Anti -Dumping Agreement and 
Article  12.7 of the SCM Agreement.  
8  CONCLUSIONS AND RECOMMENDATION  
On Korea's  claims concerning the USDOC 's CORE AD investigation, for the reasons contained  
in this Report, the Pan el concludes as follows:  
a. the United States  acted inconsistently with paragraph  1 of Annex II to  the 
Anti-Dumping  Agreement  because the USDOC  did not "specify in detail" the information 
requested and "the manner in which that information should be structure d" with respect 
to Hyundai Steel's  reporting of information concerning further manufactured sales . Given 
that paragraph  1 of Annex  II serves as a precondition for an investigating 
authority 's proper resort to facts available under Article  6.8 of the 
Anti-Dumping  Agreement , we find that the U nited States  also acted inconsistently with 
that provision ;  
b. in light of our findings of WTO -inconsistency, we do not consider it necessary to rule upon 
Korea 's claims under paragraphs 3, 5, and 6 of Annex II to the Anti-Dumping  Agreement  
in order to provide a positive solution to the dispute before us;  
c. having found that the USDOC erred in resorting to facts available with respect to 
Hyundai  Steel's reporting of information concerning further manufactured sales, we do not 
consider that making further findings on Korea 's claims concerning the USDOC 's selection 
of the replacement facts on the basis of the record used for the USDOC 's WTO-inconsistent 
findings would assist in providing a positive solution to the dispute bef ore us; and  WT/DS539/ R 
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  d. having found that the United  States  acted inconsistently with Article  6.8 and paragraph  1 
of Annex  II, we do not consider it necessary to rule upon Korea 's claims under Articles  1, 
9.3, and 18.1 of the Anti -Dumping  Agreement  in order to resolve  the dispute before us.  
On Korea's  claims concerning the USDOC 's CRS AD investigation, for the reasons contained  in 
this Report, the Panel concludes as follows:  
a. in respect of the affiliated party transactions issue:  
i. the U nited States  acted inconsistently w ith the first sentence  of paragraph  3 of 
Annex  II to the Anti -Dumping  Agreement  because the USDOC did  not "tak e[] into 
account" the information concerning affiliated party transactions that was submitted 
by Hyundai Steel in accordance with that provision. Given that paragraph  3 of Annex  II 
serves as a precondition for an investigating authority 's proper resort to facts available 
under Article  6.8 of the Anti -Dumping  Agreement , we find that the United States  also 
acted inconsistently with that provision ;  
ii. in light of our findings of WTO -inconsistency, we do not consider it necessary to rule 
upon Korea 's claims under paragraphs 1, 5, and 6 of Annex II to the 
Anti-Dumping  Agreement  in order to provide a positive solution to the dispute before 
us; and  
iii. having fo und that the USDOC erred in resorting to facts available with respect to 
information concerning affiliated party transactions that was submitted by 
Hyundai  Steel, we do not consider that making further findings on Korea 's claims 
concerning the USDOC 's selection of the replacement facts on the basis of the record 
used for the USDOC 's WTO-inconsistent findings would assist in providing a positive 
solution to the dispute before us.   
b. in respect of the CONNUMs issue:  
i. the U nited States  acted inconsistently with Article  6.8 of the Anti -Dumping  Agreement  
because the USDOC  resort ed to facts available in respect of the cost of manufacturing 
for all the affected CONNUMs for Spec s D, E, and H home market sales ;  
ii. in light of our findings of WT O-inconsistency  with respect to Specs D, E, and H home 
market sales , we do not consider it necessary to rule upon Korea 's claims under 
paragraphs 3, 5, and 6 of Annex II to the Anti-Dumping  Agreement  concerning these 
sales in order to provide a positive so lution to the dispute before us;  
iii. having found that the USDOC erred in resorting to facts available with respect to 
Specs D, E, and H home market sales, we do not consider that making further findings 
on Korea 's claims concerning the USDOC 's selection of th e replacement facts for these 
sales on the basis of the record used for the USDOC 's WTO-inconsistent findings would 
assist in providing a positive solution to the dispute before us;  
iv. with respect of the USDOC's resort to facts available for Spec C sales, Korea has not 
established that  the U nited States  acted inconsistently with Article  6.8 and 
paragraphs  3, 5, and 6 of Annex  II of the Anti -Dumping  Agreement ; and  
v. the United States  acted inconsistently with Article  6.8 of the Anti -Dumping  Agreement  
because,  in selecting the replacement facts for the Spec C sales at issue , the USDOC  
failed to take into account all the information that was properly before it. In light of 
our finding of WTO -inconsistency, we do not consider it necessary to rule upon 
Korea 's claim under paragraph  7 of Annex II to the Anti-Dumping  Agreement  in order 
to provide a positive solution to the dispute before us.  
c. having found that the United  States  acted inconsistently with Article  6.8 and paragraph  3 
of Annex  II, we do not consider  it necessary to rule upon Korea 's claims under Articles  1, 
9.3, and 18.1 of the Anti -Dumping  Agreement  in order to resolve the dispute before us.  WT/DS539/ R 
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On Korea's  claims concerning the USDOC 's HRS AD investigation, for the reasons contained  in 
this Report, the Panel concludes as follows:  
a. the U nited States  acted inconsistently with paragraph  1 of Annex II to  the 
Anti-Dumping  Agreement  because the USDOC did  not "specify in detail" the information 
concerning the affiliates ' contracts with unaffiliated customers  "[a]s soon as possible after 
the initiation". Given that paragraph  1 of Annex  II serves as a precondition for an 
investigating authority 's proper reso rt to facts available under Article  6.8 of the 
Anti-Dumping  Agreement , we find that the United States  also acted inconsistently with 
that provision ;  
b. in light of our findings of WTO -inconsistency, we do not consider it necessary to rule upon 
Korea 's claims  under paragraphs 3, 5, and 6 of Annex II to the Anti-Dumping  Agreement  
in order to provide a positive solution to the dispute before us;  
c. having found that the USDOC erred in resorting to facts available, we do not consider that 
making further findings on Korea 's claims concerning the USDOC 's selection of the 
replacement facts on the basis of the record used for the USDOC 's WTO-inconsistent 
findings would assist in providing a positive solution to the dispute before us; and  
d. having found that the United  States acted inconsistently with Article  6.8 and paragraph  1 
of Annex  II, we do not consider it necessary to rule upon Korea 's claims under Articles  1, 
9.3, and 18.1 of the Anti -Dumping  Agreement  in order to resolve the dispute before us.  
On Korea's  claims con cerning the USDOC 's CRS CVD investigation, for the reasons set forth in 
this Report, the Panel concludes as follows:  
a. in respect of the issue of cross -owned affiliate input suppliers :  
i. Korea has not established that the United States acted inconsistently wi th Article 12.7 
of the SCM Agreement with respect to the USDOC's resort to facts available ; and  
ii. the United States acted inconsistently with Article 12.7 of the SCM Agreement because 
the USDOC , in selecting the replacement facts,  did not take into account all the 
information that was properly before it and made an assumption unsupported by 
positive ev idence that the inputs supplied by the cross -owned affiliates discovered at 
verification were "primarily dedicated" to the production of the downstream product , 
thereby  also erring in finding that the relevant subsidies received by these affiliates 
were co untervailable and attributable to POSCO .  
b. in respect of the issue of a POSCO facility in an FEZ:  
i. the U nited States  acted inconsistently with Article  12.7 of the SCM Agreement because 
the USDOC, in  resorting to facts available , erroneously disregarded the 
GOK's response; and  
ii. having found that the USDOC erred in resorting to facts available, we do not consider 
that making further findings on Korea 's claims concerning the USDOC 's selection of 
the replacement facts on the basis of the record used for the 
USDOC 's WTO-inconsistent findings would assist in providing a positive solution to the 
dispute before us.  
c. in respect of the issue of the DWI loan data:  
i. the U nited States  acted inconsistently with Article  12.7 of the SCM  Agreement  because  
the USDOC, in resorting  to facts available,  did not take into account information that 
was submitted as part of POSCO 's and DWI 's direct responses before concluding that 
DWI had failed to provide "necessary" information; and  
ii. having found that the USDOC erred in resorting to fac ts available, we do not consider 
that making further findings on Korea 's claims concerning the USDOC 's selection of WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  the replacement facts on the basis of the record used for the 
USDOC 's WTO-inconsistent findings would assist in providing a positive solutio n to the 
dispute before us.  
d. having found that the United  States  acted inconsistently with Article  12.7 of the 
SCM Agreement , we do not consider it necessary to rule upon Korea 's claims under 
Articles  10, 19.4, and 32.1 of the SCM  Agreement  in order to res olve the dispute before 
us. 
On Korea's  claims concerning the USDOC 's HRS CVD investigation, for the reasons contained  
in this Report, the Panel concludes as follows:  
a. in respect of the issue of cross -owned affiliate input suppliers, the U nited States  acted 
inconsistently with Article  12.7 of the SCM  Agreement  because the USDOC  rejected the 
information concerning the cross -owned affiliate input suppliers solely on the basis that it 
was provided after the time -limit imposed by the USDOC, without conside ring whether, in 
light of the specific facts and circumstances, the information submitted by POSCO was 
nonetheless submitted within a "reasonable period";  
b. in respect of the issue of a POSCO facility in an FEZ, the U nited States  acted inconsistently 
with Article 12.7 of the SCM  Agreement  because the USDOC  rejected the information 
concerning POSCO 's facility in an FEZ solely on the basis that it was provided after the 
time-limit imposed by the USDOC, without considering whether, in light of the specific 
facts and circumstances, the information submitted by POSCO was nonetheless submitted 
within a "reasonable period";  
c. in respect of the issue of the DWI loan data, the U nited States  acted inconsistently with 
Article  12.7 of the SCM  Agreement  because the USDOC  rejected the information 
concerning DWI loan data solely on the basis that it was provided after the time -limit 
imposed by the USDOC, without considering whether, in light of the specific facts and 
circumstances, the information submitted by POSCO wa s nonetheless submitted within a 
"reasonable period";  
d. having found that the USDOC  erred in  resort ing to facts available for each of the three 
issues set out above, we do not consider that making further findings concerning the 
USDOC 's selection of the repl acement facts on the basis of the record used for the 
USDOC 's WTO-inconsistent findings would assist in providing a positive solution the 
dispute before us; and  
e. having found that the United  States  acted inconsistently with Article  12.7 of the 
SCM Agreemen t, we do not consider it necessary to rule upon Korea 's claims under 
Articles  10, 19.4, and 32.1 of the SCM  Agreement  in order to resolve the dispute before 
us. 
On Korea's  claims concerning the USDOC 's LPT POR2 proceedings, for the reasons contained  
in this Report, the Panel concludes as follows:  
a. the U nited States  acted inconsistently with paragraph  6 of Annex II to  the 
Anti-Dumping  Agreement  because – having "not accepted" the information provided by 
HHI – the USDOC failed to inform HHI "forthwith" of the reasons for its non -acceptance 
and failed to provide an opportunity to HHI for furnishing "further explanations within a 
reasonable period,  due account being taken of the time limits of the investigation". Given 
that paragraph  6 of Annex  II serves as a precondition for an investigating 
authority 's proper resort to facts available under Article  6.8 of the 
Anti-Dumping  Agreement , we find that t he United States  also acted inconsistently with 
that provision ;  
b. in light of our findings of WTO -inconsistency, we do not consider it necessary to rule upon 
Korea 's claims under paragraphs 3 and 5 of Annex II to the Anti-Dumping  Agreement  in 
order to provi de a positive solution to the dispute before us; and  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
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  c. having found that the USDOC erred in resorting to facts available with respect to 
HHI's reporting of information concerning service -related revenues, we do not consider 
that making further findings on Ko rea's claims concerning the USDOC 's selection of the 
replacement facts on the basis of the record used for the USDOC 's WTO-inconsistent 
findings would assist in providing a positive solution to the dispute before us.  
On Korea's  claims concerning the USDOC 's LPT POR3 proceedings, for the reasons contained 
in this Report, the Panel concludes as follows:  
a. in respect of the issue of service -related revenues, the United States  acted inconsistently 
with the first sentence of paragraph  3 of Annex II to  the Anti -Dumping Agreement  because 
the USDOC, in resorting to facts available, did not "tak e[] into account" the information 
concerning service -related revenues that was submitted by HHI in accordance with that 
provision. Given that paragraph  3 of Annex  II serves as a  precondition for an investigating 
authority 's proper resort to facts available under Article  6.8 of the 
Anti-Dumping  Agreement , we find that the United States  also acted inconsistently with 
that provision. In light of  our findings of WTO -inconsistency, we do not consider it 
necessary to rule upon Korea 's claims under paragraph  5 of Annex II to the 
Anti-Dumping  Agreement  in order to provide a positive solution to the dispute before us;  
b. in respect of the issue of underst atement of home -market prices, the U nited States  acted 
inconsistently with Article  6.8 of the Anti -Dumping  Agreement  because the USDOC  
resort ed to facts available for HHI's reporting of an LPT part as non -subject merchandise. 
In light of our finding of WTO -inconsistency, we do not consider it necessary to address 
Korea 's claims under paragraphs 3 and 5 of Annex II to the Anti-Dumping  Agreement  in 
order to provide a positive solution to the dispute before us;  
c. in respect of the issue of accessories, the U nited States  acted inconsistently with 
paragraph  1 of Annex II to  the Anti -Dumping  Agreement  because  the USDOC , by not 
providing further guidance as to the meaning of the term "accessories ", failed to "specify 
in detail" the information required  before resorti ng to facts available . Given that 
paragraph  1 of Annex  II serves as a precondition for an investigating authority 's proper 
resort to facts available under Article  6.8 of the Anti -Dumping  Agreement , we find that 
the U nited States  also acted inconsistently with that provision. In light of our findings of 
WTO-inconsistency, we do not consider it necessary to rule upon Korea 's claims under 
paragraphs 3 and 5 of Annex II to the Anti-Dumping  Agreement  in order to provide a 
positive sol ution to the dispute before us;  
d. in respect of the issue of certain sales documentation, the U nited States  acted 
inconsistently with paragraph  6 of Annex  II because  the USDOC  – having "not accepted" 
the information provided by HHI – subsequently failed to g ive an opportunity to HHI to 
"provide further explanations within a reasonable period". Given that paragraph  6 of 
Annex  II serves as a precondition for an investigating authority 's proper resort to facts 
available under Article  6.8 of the Anti -Dumping  Agreement , we find that the United States 
also acted inconsistently with that provision. In light of our findings of WTO -inconsistency, 
we do not consider it necessary to rule upon Korea 's claims under paragraphs 3 and 5 of 
Annex  II to the Anti-Dumping  Agreeme nt in order to provide a positive solution to the 
dispute before us; and  
e. having found that the USDOC erred in resorting to facts available for each of the 
four issues identified above, we do not consider that making further findings on 
Korea 's claims conce rning the USDOC 's selection of the replacement facts on the basis of 
the record used for the USDOC 's WTO-inconsistent findings would assist in providing a 
positive solution to the dispute before us.  
On Korea's  claims concerning the USDOC 's LPT POR4 proceed ing, for the reasons contained  in 
this Report, the Panel concludes as follows:  
a. in respect of the issue of accessories for HHI, the U nited States  acted inconsistently with 
paragraph  1 of Annex II to  the Anti -Dumping  Agreement  because the USDOC, by not 
providing further guidance as to the meaning of the term "accessories", failed to "specify WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 216 - 
 
  in detail" the information required before resorting to facts available . Given that 
paragraph  1 of Annex  II serves as a precondition for an  investigating authority 's proper 
resort to facts available under Article  6.8 of the Anti -Dumping  Agreement , we find that 
the U nited States  also acted inconsistently with that provision. In light of our findings of 
WTO-inconsistency, we do not consider it necessary to rule upon Korea 's claims under 
paragraphs 3 and 5 of Annex II to the Anti-Dumping  Agreement  in order to provide a 
positive solution to the dispute before us;  
b. in respect of the issue of home market gross -unit prices for HHI, the United States  acted 
inconsistently with paragraph  6 of Annex II to  the Anti -Dumping  Agreement  because  the 
USDOC – having "not accepted" the information provided by HHI as it was "unclear"  – did 
not subsequently give an opportunity to HHI to provide "further explanations within a 
reasonable period". Given that paragraph  6 of Annex  II serves as a precondition for an 
investigating authority 's proper resort to facts available under Article  6.8 of the 
Anti-Dumping  Agreement , we find that the United States also acted inconsiste ntly with 
that provision. In light of our findings of WTO -inconsistency, we do not consider it 
necessary to rule upon Korea 's claims under paragraphs 3 and 5 of Annex II to the 
Anti-Dumping  Agreement  in order to provide a positive solution to the dispute b efore us;  
c. in respect of the issue of the US sales agent for HHI, the U nited States  acted 
inconsistently  with paragraph  6 of Annex II to  the Anti -Dumping  Agreement  because the 
USDOC – having not accepted HHI's submission that it was not affiliated with any of its 
sales agents – did not subsequently give an opportunity to HHI to provide "further 
explanations within a reasonable period". Given that paragraph  6 of Anne x II serves as a 
precondition for an investigating authority 's proper resort to facts available under 
Article  6.8 of the Anti -Dumping  Agreement , we find that the U nited States  also acted 
inconsistently with that provision. In light of our findings of WTO -inconsistency, we do not 
consider it necessary to address Korea 's claims under paragraphs 3 and 5 of Annex II to 
the Anti-Dumping  Agreement  in order to provide a positive solution to the dispute before 
us; 
d. in respect of the issue of service -related revenues  for Hyosung, the U nited States  acted 
inconsistently with paragraph  6 of Annex II to  the Anti -Dumping  Agreement  because the 
USDOC  did not  inform Hyosung "forthwith" of the reasons for not accepting the information 
that had been submitted and did not give H yosung an opportunity to provide "further 
explanations within a reasonable period". Given that paragraph  6 of Annex  II serves as a 
precondition for an investigating authority 's proper resort to facts available under 
Article  6.8 of the Anti -Dumping  Agreemen t, we find that the United States  also acted 
inconsistently with that provision. In light of our findings of WTO -inconsistency, we do not 
consider it necessary to address Korea 's claims under paragraphs 3 and 5 of Annex  II to 
the Anti-Dumping  Agreement  in order to provide a positive solution to the dispute before 
us; 
e. in respect of the issue of the invoice covering multiple US sales for Hyosung, the 
United States  acted inconsistently with paragraph  6 of Annex II to  the 
Anti-Dumping  Agreement  because the USDOC  did not inform Hyosung "forthwith" about 
the alleged  deficiency in the invoice at issue that was "not accepted" and because it did 
not give Hyosung an opportunity to provide "further explanations within a reasonable 
period". Given that paragraph  6 of Annex  II serves as a precondition for an investigating 
authority 's proper resort to facts available under Article  6.8 of the 
Anti-Dumping  Agreement , we find that the U nited States  also acted inconsistently with 
that provision . In light of our fi ndings of WTO -inconsistency, we do not consider it 
necessary to address Korea 's claims under paragraphs 3 and 5 of Annex II to the 
Anti-Dumping  Agreement  in order to provide a positive solution to the dispute before us;  
f. in respect of the issue of discounts  and price adjustments for Hyosung, the U nited States  
acted inconsistently with paragraph  6 of Annex II to  the Anti -Dumping  Agreement  because 
the USDOC did not  inform Hyosung of any alleged  deficiencies in the explanations that 
were provided in Hyosung 's case brief and because it did not give Hyosung an opportunity 
to provide "further explanations within a reasonable period". Given that paragraph  6 of 
Annex  II serves as a precondition for an investigating authority 's proper resort to facts 
available under Article 6.8 of the Anti -Dumping  Agreement , we find that the United States  WT/DS539/ R 
BCI deleted, as indicated [[***]]  
- 217 - 
 
  also acted inconsistently with that provision. In light of our findings of WTO -inconsistency, 
we do not consider it necessary to address Korea 's claims under paragraphs 3 and 5 of 
Annex II to the Anti-Dumping  Agreement  in order to provide a positive solution to the 
dispute before us;  
g. having found that the USDOC erred in resorting to facts available with respect to both HHI 
and Hyosung for all of t he issues set out  above, we do not consider that making further 
findings on Korea 's claims concerning the USDOC 's selection of the replacement facts on 
the basis of the record used for the USDOC 's WTO-inconsistent findings would assist in 
providing a posit ive solution to the dispute before us;  and 
h. in respect of the USDOC 's selection of an "all others" rate, the United States acted 
inconsistently with Article 9.4 of the Anti -Dumping Agreement because the USDOC 
determined the ceiling for the "all others" rate  in respect of Iljin, Iljin Electric, and LSIS 
based on "margins established under the circumstances referred to in paragraph 8 of 
Article 6" of the Anti -Dumping Agreement.  
On the claims under Articles  1, 9.3, and 18.1 of the Anti -Dumping  Agreement  concern ing the 
USDOC 's LPT POR2, POR3, and POR4 proceedings, for the reasons contained  in this Report, having 
already found that the United  States  acted inconsistently with Article  6.8 and certain provisions of 
Annex  II, we do not consider it necessary to rule up on Korea 's claims under Articles  1, 9.3, and 18.1 
in order to resolve the dispute before us.  
On Korea 's "as such" claim against the alleged unwritten measure, for the reasons contained  
in this Report, the Panel concludes as follows:  
a. Having considered the United States'  request for a preliminary ruling regarding the 
Panel 's terms of reference and the responses thereto, for purposes of Article  6.2 of the 
DSU, the alleged unwritten measure that is the object of Korea 's "as such" challenge is 
properly identifie d in Section  I.C of its panel request ; and  
b. Korea has failed to establish the existence of the alleged unwritten measure with the 
precise content identified by it.  
Under Article  3.8 of the DSU, in cases where there is infringement of the obligations assumed 
under a covered agreement , the action is considered prima facie  to constitute a case of nullification 
or impairment of benefits under that  Agreement . Accordingly, to the extent  the United  States  has 
acted inconsistently with certain provisions of the SCM and Anti -Dumping  Agreement s, we conclude 
that it has nullified or impaired benefits accruing to Korea under those  Agreement s.  
Pursuant to Article  19.1 of the DSU, having found that the United  States  has acted 
inconsistently with the Anti-Dumping and the SCM  Agreement s, we recommend  that the 
United  States  bring the measures  at issue  into conformity with th ese Agreement s. 
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