WT/DS504/AB/R  
 
10 September  2019 
(19-5758) Page: 1/149 
    
 
 
KOREA – ANTI-DUMPING  DUTIES ON PNEUMATIC  VALVES FROM JAPAN  
AB-2018-3 
Report of the Appellate  Body WT/DS504/AB/R  
 
- 2 - 
 
  Table of Contents  
 
1   INTRODUCTION  ................................ ................................ ................................ ........  10 
2   ARGUMENTS OF THE  PARTICIPANTS  ................................ ................................ .........  15 
3   ARGUMENTS OF THE  THIRD PARTICIPANTS  ................................ ..............................  15 
4   ISSUES RAISED  ................................ ................................ ................................ .........  15 
5   ANALYSIS OF THE APPELLATE  BODY  ................................ ................................ .........  17 
5.1   Overall considerations regarding the legal standard under Article  6.2 of the DSU  ...............  17 
5.1.1    The legal standard under Article  6.2 of the DSU  ................................ ..........................  17 
5.1.2    Whether the Panel erred in its articulation of the applicable legal standard u nder 
Article  6.2 of the DSU  ................................ ................................ ................................ ........  20 
5.2   Domestic industry ................................ ................................ ................................ ...... 22 
5.2.1    Whether the Panel erred in finding that Japan's claim 7 concerning the definition  
of the domestic industry was not within its terms of reference  ................................ ................  22 
5.2.2    Whether the Appellate  Body can complete the legal analysis  ................................ ........  26 
5.3   Determination of injury  ................................ ................................ ..............................  34 
5.3.1    Introduction  ................................ ................................ ................................ ...........  34 
5.3.2    Whether the Panel erred in its findings under Article  6.2 of the DSU  ..............................  35 
5.3.3    Magnitude of margin of dumping  ................................ ................................ ..............  56 
5.3.4    Causatio n ................................ ................................ ................................ ..............  62 
5.3.5    Whether the Appellate  Body can complete the legal analysis under Articles  3.1, 3.2, 
and 3.4 of the Anti -Dumping  Agreement  ................................ ................................ ..............  96 
5.4   Confidential treatment of information  ................................ ................................ ..........  112 
5.4.1    Whether the Panel erred in finding that Japan's claims 8 and 9 concerning the  
confidential treatment of information were within its terms of reference  ................................ . 113 
5.4.2    Articles  6.5 and 6.5.1 of the Anti -Dumping  Agreement  ................................ ...............  116 
5.5   Essential facts  ................................ ................................ ................................ ..........  130 
5.5.1    Whether the Panel erred in finding that Japan's claim 10 concerning  the disclosure  
of essential facts was not within its terms of reference  ................................ .........................  130 
5.5.2    Whether the Appellate  Body can complete the legal analysis under Article  6.9 of the 
Anti-Dumping  Agreement  ................................ ................................ ................................ .. 133 
6   FINDINGS AND CON CLUSIONS  ................................ ................................ ................  138  
6.1   Overall considerations regarding the legal standard under Article  6.2 of the DSU  ..............  138 
6.2   Domestic industry ................................ ................................ ................................ ..... 139 
6.2.1    Whether the Panel erred in finding that Japan's claim 7 concerning  the definition of  
the domestic industry was not within its terms of reference ................................ ...................  139 
6.2.2    Whether the Appellate  Body can complete the legal analysis  ................................ ....... 139 
6.3   Determination of injury  ................................ ................................ .............................  139 
6.3.1    Whether the Panel erred in finding that Japan's claim 1 concerning the volume of  
dumped imports was not within its terms of reference  ................................ ..........................  139 
6.3.2    Whether the Panel erred in finding that Japan's claim 2 concerning the price effects  
was not within its terms of reference  ................................ ................................ ..................  140 
6.3.3    Whether the Panel erred in finding that part of Japan's claim 3 concerning the impact  
of the dumped imports on the domestic industry was not within its terms of reference  .............  140 WT/DS504/AB/R  
 
- 3 - 
 
  6.3.4    Whether the Panel erred in finding that Japan's claim 4 was within its terms of  
reference  ................................ ................................ ................................ ........................  141 
6.3.5    Whether the Panel erred in finding that part of Japan's claim 5 was within its terms  
of reference  ................................ ................................ ................................ ....................  141 
6.3.6    Whether the Panel erred in finding that Japan's claim 6 was within its terms of  
reference  ................................ ................................ ................................ ........................  141 
6.3.7    Magnitude of the margin of dumping  ................................ ................................ ........  142 
6.3.8    Causation  ................................ ................................ ................................ .............  142 
6.3.9    Whether the Appellate  Body can complete the legal analysis under Article s 3.1, 3.2, 
and 3.4 of the Anti -Dumping Agreement  ................................ ................................ .............  144 
6.4   Confidential treatment of information  ................................ ................................ ..........  147 
6.4.1    Whether the Panel erred in finding that Japan's claims 8 and 9 concerning the  
confidential treatment of information were within its terms of reference  ................................ . 147 
6.4.2    Whether the Panel erred in its interpretation or application of Article  6.5 of the 
Anti-Dumping Agreement  ................................ ................................ ................................ .. 147 
6.4.3    Whether the Panel erred in its application of Article  6.5.1 of the Anti -Dumping  
Agreement  ................................ ................................ ................................ ......................  148 
6.5   Essential facts  ................................ ................................ ................................ ..........  148 
6.5.1    Whether the Panel erred in finding that Japan's claim 10 concerning  the disclosure  
of essential facts was not within its terms of reference  ................................ .........................  148 
6.5.2    Whether the Appellate  Body can complete the legal analysis under Article  6.9 of  
the Anti -Dumping Agreement  ................................ ................................ ............................  148 
6.6   Recommendation  ................................ ................................ ................................ ...... 149 
  WT/DS504/AB/R  
 
- 4 - 
 
  ABBREVIATIONS USED I N THIS REPORT  
Abbreviation  Description  
Anti-Dumping Agreement  Agreement on Implementation of Article  VI of the General Agreement 
on Tariffs and Trade 1994  
BCI business confidential information  
CKD CKD Corporation  
DSB Dispute Settlement Body  
DSU Understanding on Rules and Procedures Governing the Settlement of 
Disputes  
GATT  1994  General Agreement on Tariffs and Trade 1994  
Japan's panel request  Request for the Establishment of a Panel by Japan, WT/DS504/2  
Korean investigating 
authorities  Korea Trade Commission and Office of Trade Investigation  
KCC KCC Co., Ltd.  
KTC Korea Trade Commission  
KTC's Final Resolution  KTC, Resolution of Final Determination on Dumping and Injury to 
Domestic Industry of Valves for Pneumatic Transmissions from Japan, 
20 January  2015 (Panel Exhibits JPN -4b (public version) and KOR -1b 
(BCI))  
KTC's Preliminary 
Resolution  KTC, Resolution of Preliminary Determination on Dumping and Injury 
to the Domestic Industry of Valves for Pneumatic Transmissions from 
Japan, 26  June 2014 (Panel Exhibit JPN -1b) 
MOSF  Minister/Ministry of Strategy and Finance  
MOSF's Decree No. 498  MOSF, Decree No. 498, Regulation Concerning the Imposition of 
Anti-Dumping Duties on Valves for Pneumatic Transmissions 
originating from Japan,  19 August  2015 (Panel Exhibit JPN -6b) 
MOSF's Public 
Announcement  MOSF, Public Announcement No. 2015 -156, Decision to Apply 
Anti-Dumping Duties on the Pneumatic Transmissions Valves from 
Japan,  19 August  2015 (Panel Exhibit KOR -3b (BCI))  
OTI Office of Trade Investigation  
OTI's Final Report  OTI, Final Report on Dumping and Injury to Domestic Industry of 
Valves for Pneumatic Transmissions Imported from Japan, 
20 January  2015 (Panel Exhibits JPN -5b (public version) and KOR -2b 
(BCI))  
OTI's Interim Report  OTI, Interim Investigation Report on Dumping and Injury to Domestic 
Industry of Valves for Pneumatic Transmissions from Japan, 
23 October  2014 (Panel Exhibit JPN -3b) 
OTI's Preliminary Report  OTI, Preliminary Report on Dumping and Injury to Domestic Industry 
of Valves for Pneumatic Transmissions imported from Japan, 
26 June 2014 (Panel Exhibit JPN -2b) 
Panel Report  Korea – Anti-Dumping  Duties on Pneumatic Valves from Japan  
(WT/DS504/R)  
pneumatic valves  valves for pneumatic transmissions  
POI period of investigation  
SG&A  selling, general, and administrative (costs)  
Shin Yeong  Shin Yeong Mechatronics  
SMC SMC Corporation  WT/DS504/AB/R  
 
- 5 - 
 
  Abbreviation  Description  
TPC TPC Mechatronics Corporation  
Working Procedures  Working Procedures for Appellate Review, WT/AB/WP/6, 
16 August  2010 
WTO  World Trade Organization  
Yonwoo  Yonwoo Pneumatic  
 
CASES CITED IN THIS REPORT  
Short Title  Full Case Title and Citation  
Argentina – Footwear (EC)  Appellate  Body Report, Argentina – Safeguard Measures on Imports of 
Footwear , WT/DS121/AB/R , adopted 12  January  2000, DSR 2000:I, p.  515 
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 Poultr y from 
Brazil , WT/DS241/R , adopted 19  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 
Brazil – Desiccated Coconut  Appellate  Body Report, Brazil – Measures Affecting Desiccated Coconut , 
WT/DS22/AB/R , adopted 20  March  1997, DSR 1997:I, p.  167 
Brazil – Retreaded Tyres  Appellate  Body Report, Brazil – Measures Affecting Imports of Retreaded 
Tyres , WT/DS332/AB/R , adopted 17  December  2007, DSR 2007:IV, p.  1527 
Canada – Periodicals  Appellate  Body Report, Canada – Certain Measures Concerning Periodicals , 
WT/DS31/AB/R , adopted 30  July 1997, DSR 1997:I, p.  449 
Canada – Renewable Energy 
/ Canada – Feed-in Tariff 
Program  Appellate  Body Reports, Canada – Certain Measures Affecting the Renewable 
Energy Generation Sector / Canada – Measures Relating to the Feed -in Tariff 
Program , WT/DS412/AB/R  / WT/DS426/AB/R , adopted 24  May 2013, 
DSR 2013:I, p.  7 
Chile – Price Band System  Appellate  Body Report, Chile – Price Band System and Safeguard Measures 
Relating to Certain Agricultural Products , WT/DS207/AB/R , adopted 
23 October  2002, DSR 2002:VIII, p.  3045 (Corr.1, DSR 2006:XII, p.  5473)  
Chile – Price Band System 
(Article  21.5 – Argentina)  Appellate  Body Report, Chile – Price Band System and Safeguard Measures 
Relating to Certain Agricultural Products – Recourse to Article  21.5 of the DSU 
by Argentina , WT/DS207/AB/RW , adopted 22  May 2007, DSR 2007:II, p.  513 
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 – Cellulose Pulp  Panel Report, China – Anti-Dumping  Measures on Imports of Cellulose Pulp from 
Canada , WT/DS4 83/R and Add.1, adopted 22  May 2017, DSR 2017:IV, p.  1961 
China – GOES  Appellate  Body Report, China – Countervailing and Anti -Dumping  Duties on 
Grain Oriented Flat -Rolled Electrical Steel from the United  States , 
WT/DS414/AB/R , adopted 16  November  2012, DS R 2012:XII, p.  6251 WT/DS504/AB/R  
 
- 6 - 
 
  Short Title  Full Case Title and Citation  
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 Report 
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 – HP-SSST (Japan) / 
China – HP-SSST (EU)  Panel Reports, China – Measures Imposing Anti -Dumping Duties on 
High-Performance Stainless Steel Seamless Tubes ("HP -SSST") from Japan / 
China – Measu res Imposing Anti -Dumping  Duties on High -Performance 
Stainless Steel Seamless Tubes ("HP -SSST") from the European  Union , 
WT/DS454/R  and Add.1 / WT/DS460/R , Add.1 and Corr.1, adopted 
28 October  2015, as modified by Appellate  Body Reports WT/DS454/AB/R / 
WT/DS460/AB/R, DSR  2015:IX, p.  4789 
China – Rare Earths  Appellate  Body Reports, China – Measures Related to the Exportation of Rare 
Earths, Tungsten, and Molybdenum , WT/DS431/AB/R  / WT/DS432/AB/R  / 
WT/DS433/AB/R , adopted 29  August  2014, DSR 2014:III, p.  805 
China – Raw Materials  Appellate  Body Reports, China – Measures Related to the Exportation of 
Various Raw Materials , WT/DS394/AB/R  / WT/DS395/AB/R  / WT/DS398/AB/R , 
adopted 22  February  2012, DSR 2012:VII, p.  3295 
China – X-Ray Equipment  Panel Report,  China – Definitive Anti -Dumping  Duties on X -Ray Security 
Inspection Equipment from the European  Union , WT/DS425/R  and Add.1, 
adopted 24  April 2013, DSR 2013:III, p.  659 
Colombia – Textiles  Appellate  Body Report, Colombia – Measures Relating to the Importation of 
Textiles, Apparel and Footwear , WT/DS461/AB/R  and Add.1, adopted 
22 June 2016, DSR 2016:III, p.  1131 
EC – Approval and Marketing 
of Biotech Products  Panel Reports, European Communities – Measures Affecting the Appro val and 
Marketing of Biotech Products , WT/DS291/R , Add.1 to Add.9 and Corr.1 / 
WT/DS292/R , Add.1 to Add.9 and Corr.1 / WT/DS293/R , Add.1 to Add.9 and 
Corr.1, adopted 21  November  2006, DSR 2006:III, p.  847 
EC – Asbestos  Appellate  Body Report, European Communities – Measures Affecting Asbestos 
and Asbestos -Containing Products , WT/DS135/AB/R , adopted 5  April 2001, 
DSR 2001:VII, p.  3243 
EC – Bananas III  Appellate  Body Report, European Communities – Regime for the Importation, 
Sale and Distribution of Bananas , WT/DS27/AB/R , adopted 
25 September  1997, DSR 1997:II, p.  591 
EC – Bed Linen (Article  21.5 
– India)  Appellate  Body Report, European Communities – Anti-Dumping  Duties on 
Imports of Cotton -Type Bed Linen from India – Recourse to Arti cle 21.5 of the 
DSU by India , WT/DS141/AB/RW , adopted 24  April 2003, DSR 2003:III, 
p. 965 
EC – Export Subsidies on 
Sugar  Appellate  Body Report, European Communities – Export Subsidies on Sugar , 
WT/DS265/AB/R , WT/DS266/AB/R , WT/DS283/AB/R , adopted 19  May 2005, 
DSR 2005:XIII, p.  6365 
EC – Fasteners (China)  Appellate  Body Report, European Communities – Definitive Anti -Dumping  
Measures on Certain Iron or Steel Fasteners from China , WT/DS397/AB/R , 
adopted 28  July 2011, DSR 2011:VII, p.  3995 
EC – Fasteners (China)  Panel Report, European Communities – Definitive Anti -Dumping  Measures on 
Certain Iron or Steel Fasteners from China , WT/DS397/R  and Corr.1, adopted 
28 July 2011, as modified by Appellate  Body Report WT/DS397/AB/R, 
DSR 2011:VIII, p.  4289 WT/DS504/AB/R  
 
- 7 - 
 
  Short Title  Full Case Title and Citation  
EC – Fasteners (China) 
(Article  21.5 – China)  Appellate  Body Report, European Communities – Definitive Anti -Dumping  
Measures on Certain Iron or Steel Fasteners from China – Recourse to 
Article  21.5 of the DSU by China , WT/DS397/AB/RW  and Add.1 , adopted 
12 February  2016, DSR 2016:I, p.  7 
EC – Hormones  Appellate  Body Report, European Communities – Measures Concerning Meat 
and Meat Products (Hormones) , WT/DS26/AB/R , WT/DS48/AB/R , adopted 
13 February  1998, DSR 1998:I, p.  135 
EC – Poultry  Appellate  Body Report, European Communities – Measures Affecting the 
Importation of Certain Poultry Products , WT/DS69/AB/R , adopted 
23 July 1998, DSR 1998:V, p.  2031 
EC – Sardines  Appellate  Body Report, European Communities – Trade Description of 
Sardines , WT/DS231/AB/R , adopted 23  October  2002, DSR 2002:VIII, p.  3359 
EC – Seal Products  Appellate  Body Reports, European Communities – Measures Prohibiting the 
Importation and Marketing of Seal Products , WT/DS400/AB/R  / 
WT/DS401/AB/R , adopted 18  June 2014, DSR 2014:I, p.  7 
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 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 
EC and certain member 
States – Large Civil Aircraft 
(Article  21.5 – US) Appellate  Body Report, European Communities and Certain Member States – 
Measures Affecting Trade in Large Civil Aircraft  – Recourse to Article  21.5 of 
the DSU by the United  States , WT/DS316/AB/RW  and Add.1, adopted 
28 May 2018 
Guatemala – Cement I  Appellate  Body Report, Guatemala – Anti-Dumping  Investigation Regarding 
Portland Cement from Mexico , WT/DS60/AB/R , adopted 25  November  1998, 
DSR 1998:IX, p.  3767 
India – Patents (US)  Appellate  Body Report, India – Patent Protection for Pharmaceutical and 
Agricultural Chemical Products , WT/DS50/AB/R , adopted 16  January  1998, 
DSR 1998:I, p.  9 
Japan – Apples  Appellate  Body Report, Japan – Measures Affecting the Importation o f Apples , 
WT/DS245/AB/R , adopted 10  December  2003, DSR 2003:IX, p.  4391 
Korea – Alcoholic Beverages  Appellate  Body Report, Korea – Taxes on Alcoholic Beverages , WT/DS75/AB/R , 
WT/DS84/AB/R , adopted 17  February  1999, DSR 1999:I, p.  3 
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)  Panel Report, Korea – Anti-Dumping  Duties on Pneumatic Valves from Japan , 
WT/DS504/R  and Add.1, circulated to WTO Members 12  April 2018  
Mexico – Corn Syrup 
(Article  21.5 – US) Appellate  Body Report, Mexico – Anti-Dumping  Investigation of High Fructose 
Corn Syrup (HFCS) from the United  States  – Recourse to Article  21.5 of the 
DSU by the United  States , WT/DS132/AB/RW , adopted 21  November  2001, 
DSR 2001:XIII, p.  6675 
Peru – Agricultural Products  Appellate  Body Report, Peru – Additional Duty on Imports of Certain 
Agricultural Products , WT/DS457/AB/R  and Add.1, adopted 31  July 2015, 
DSR 2015:VI, p.  3403 
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 WT/DS504/AB/R  
 
- 8 - 
 
  Short Title  Full Case Title and Citation  
Russia – Commercial 
Vehicles  Panel Report, Russia – Anti-Dumping  Duties on Light Commercial Vehicles 
from Germany and Italy , WT/DS479/R  and Add.1, adopted 9  April 2018, as 
modified by A ppellate  Body Report WT/DS479/AB/R  
Russia – Pigs (EU)  Appellate  Body Report, Russian Federation – Measures on the Importation of 
Live Pigs, Pork and Other Pig Products from the European  Union , 
WT/DS475/AB/R  and Add.1, adopted 21  March  2017, DSR 2017:I, p.  207 
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 
Thailand – H-Beams  Panel Report, Thailand – Anti-Dumping  Duties on Angles, Shapes and Sections 
of Iron or Non -Alloy Steel and H -Beams from Poland , WT/DS122/R , adopted 
5 April 2001, as modified by Appellate  Body Report WT/DS122/AB/R, 
DSR 2001:VII, p.  2741 
US – 1916 Act  Appellate  Body Report, United  States  – Anti-Dumping  Act of 1916 , 
WT/DS136/AB/R , WT/DS162/AB/R , adopted 26  September  2000, DSR 2000:X, 
p. 4793 
US – Anti-Dumping  and 
Countervailing Duties (China)  Appellate  Body Report, United  States  – Definitive Anti -Dumping  and 
Countervailing Duties on Certain Products from China , WT/DS379/AB/R , 
adopted 25  March  2011, DSR 2011:V, p.  2869 
US – Anti-Dumping  
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 – Carbon Steel  Appellate  Body Report, United  States  – Countervailing Duties on Certain 
Corrosion -Resistant Carbon Steel Flat Products from Germany , 
WT/DS213/AB/R  and Corr.1, adopted 19  December  2002, DSR 2002:IX, 
p. 3779 
US – Carbon Steel (India)  Appellate  Body Report, United  States  – Countervailing Measu res on Certain 
Hot-Rolled Carbon Steel Flat Products from India , WT/DS436/AB/R , adopted 
19 December  2014, DSR 2014:V, p.  1727 
US – Continued Zeroing  Appellate  Body Report, United  States  – Continued Existence and Application of 
Zeroing Methodology , WT/DS350/AB/R , adopted 19  February  2009, 
DSR 2009:III, p.  1291 
US – COOL  Appellate  Body Reports, United  States – Certain Country of Origin Labelling 
(COOL) Requirements , WT/DS384/AB/R  / WT/DS386/AB/R , adopted 
23 July 2012, DSR 2012:V, p.  2449 
US – Countervailing and 
Anti-Dumping  Measures 
(China)  Appellate  Body Report, United  States  – Countervailing and Anti -Dumping  
Measures on Certain Products from China , WT/DS449/AB/R  and Corr.1, 
adopted 22  July 2014, DSR 2014:VIII, p.  3027 
US – Countervailing 
Measures (China)  Appellate  Body Report, United  States  – Countervailing Duty Measures on 
Certain Products from China , WT/DS 437/AB/R , adopted 16  January  2015, 
DSR 2015:I, p.  7 
US – Gambling  Appellate  Body Report, United  States – Measures Affecting the Cross -Border 
Supply of Gambling and Betting Services , WT/DS285/AB/R , adopted 
20 April 2005, DSR 2005:XII, p.  5663 (and Corr.1, DSR 2006:XII, p.  5475)  
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 on Certain 
Hot-Rolled Steel Products from Japan , WT/DS184/AB/R , adopted 
23 August  2001, DSR 2001:X, p.  4697 WT/DS504/AB/R  
 
- 9 - 
 
  Short Title  Full Case Title and Citation  
US – Lamb  Appellate  Body Report, United  States  – Safeguard Measures on Imports of 
Fresh, Chilled or Frozen Lamb Meat from New Zealand and Australia , 
WT/DS177/AB/R , WT/DS178/AB/R , adopted 16  May 2001, DSR 2001:IX, 
p. 4051 
US – Large Civil Aircraft 
(2nd complaint)  Appellate  Body Report, United  States  – Measures Affecting Trade in Large Civil 
Aircraft (Second Complaint) , WT/DS353/AB/R , adopted 23  March  2012, 
DSR 2012:I, p.  7 
US – 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 – Section 211 
Appropriations Act  Appellate  Body Report, United  States  – Section 211 Omnibus Appropriations 
Act of 1998 , WT/DS176/AB/R , adopted 1  February  2002, DSR 2002:II, p.  589 
US – Shrimp  Appellate  Body Report, United  States  – Import Prohibition of Certain Shrimp 
and Shrimp Products , WT/DS58/AB/R , adopted 6  November  1998, 
DSR 1998:VII, p.  2755 
US – Softwood Lumber VI 
(Article  21.5 – Canada)  Appellate  Body Report, United  States  – Investigation of the International Trade 
Commission in Softwood Lumber from Canada – Recourse to 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 Safeguards  Appellate  Body Report, United  States  – Definitive Safeguard Measures on 
Imports of Certain Steel Products , WT/DS248/AB/R , WT/DS249/AB/R , 
WT/DS251/AB/R , WT/DS252/AB/R , WT/DS253/AB/R , WT/DS254/AB/R , 
WT/DS258/AB/R , WT/DS259/AB/R , adopted 10  December  2003, 
DSR 2003:VII, p.  3117 
US – Tax Incentives  Appellate  Body Report, United  States  – Conditional Tax Incentives for Large 
Civil Aircraft , WT/DS487/AB/R  and Add.1, adopted 22  September  2017, 
DSR 2017:V, p.  2199 
US – Tyres (China)  Appellate  Body Report, United  States  – Measures Affecting Imports of Certain 
Passenger Vehicle and Light Truck Tyres from China , WT/DS399/AB/R , 
adopted 5  October  2011, DSR 2011:IX, p.  4811 
US – Upland Cotton 
(Article  21.5 – Brazil)  Appellate  Body Report, United  States  – Subsidies on Upland Cotton – Recourse 
to Article  21.5 of the DSU by Brazil , WT/DS267/AB/RW , adopted 
20 June 2008, DSR 2008:III, p.  809 
US – Washing Machines  Appellate  Body Report,  United  States  – Anti-Dumping  and Countervailing 
Measures on Large Residential Washers from Korea , WT/DS464/AB/R  and 
Add.1, adopted 26  September  2016, DSR 2016:V, p.  2275 
US – Wheat Gluten  Appellate  Body Report, United  States  – Definitive Safeguard Measures on 
Imports of Wheat Gluten  from the European Communities , WT/DS166/AB/R , 
adopted 19  January  2001, DSR 2001:II, p.  717 
US – 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 
US – Zeroing (Japan) 
(Article  21.5 – Japan)  Appellate  Body Report, United  States  – Measures Relating to Zeroing and 
Sunset Reviews – Recourse to Article  21.5 of the DSU by Japan , 
WT/DS322/AB/RW , adopted 31  August  2009, DSR 2009:VIII, p.  3441 
 
  WT/DS504/AB/R  
 
- 10 - 
 
  WORLD TRADE ORGANIZATION  
APPELLATE  BODY 
 
 
Korea – Anti-Dumping  Duties on 
Pneumatic Valves from Japan  
 
Japan, Appellant/Appellee  
Republic of Korea, Other Appellant/Appellee  
 
Brazil, Third Participant  
Canada, Third Participant  
China, Third Participant  
Ecuador, Third Participant  
European Union, Third Participant  
Norway, Third Participant  
Singapore, Third Participant  
Turkey, Third Participant  
United  States, Third Participant  
Viet Nam, Third Participant  AB-2018-3 
 
Appellate  Body Division:  
 
Bhatia, Presiding Member  
Graham, Member  
Servansing, Member  
 
 
 
1  INTRODUCTION  
1.1.  Japan and the Republic of Korea (Korea) each appeal certain issues of law and legal 
interpretations developed in the Panel  Report , Korea – Anti-Dumping  Duties on Pneumatic Valves 
from Japan1 (Panel  Report ). 
1.2.  This dispute concerns the definitive anti -dumping  duties imposed by Korea on imports of valves 
for pneumatic transmissions (pneumatic valves) originating from Japan, following the investigation 
conducted by the Korea Trade Commission (KTC) and the KTC's Office of Trade Investigation (OTI).2 
The KTC initiated the investigation and published the notice of initiation on 21  February  2014 based 
on an application filed by two producers of pneumatic valves in Korea.3 On 19  August  2015, on the 
basis of the KTC's Final Resolution4, the Minister of St rategy and Finance ( MOSF ) imposed 
anti-dumping duties on the imports of pneumatic valves from Japan through Decree No. 498 for five 
years at the following rates: 11.66% for SMC Corporation (SMC) and exporters of its products, and 
22.77% for CKD Corporation  (CKD) , Toyooki Kogyo Co., Ltd., and exporters of their products, as 
well as other suppliers from Japan.5 
1.3.  The Panel was established on 4  July 2016 to consider the complaint by Japan with respect to 
the consistency of the anti -dumping measures imposing the above duties (the measure at issue) 
with the Agreement on Implementation of Article  VI of the General Agreement on Tariffs and 
Trade  1994 (Anti -Dumping Agreement) and the General Agreement on Tariffs and Trade 1994 
(GATT  1994) .6 After consultation with the  parties, on 15  November  2016, the Panel adopted its 
                                                
1 WT/DS504/R, 12  April 2018.  
2 Panel  Report, paras.  2.1-2.5. 
3 Panel  Report, para.  2.2. The applicants were TPC Mechatronics Corporation (TPC) and KCC  Co., Ltd. 
(KCC). (Ibid.)  
4 KTC, Resolution of Final Determination on Dumping and Injury to Domestic Industry of Valves for 
Pneumatic Transmissions from Japan, 20  January  2015 (KTC's Final Resolution) (Panel Exhibits JPN -4b (public 
version) and KOR -1b (BCI)). In this Report, Panel e xhibit numbers that are followed by the letter "b" refer to 
the English version of the relevant document. The KTC issued its Final Resolution on the basis of OTI, Final 
Report on Dumping and Injury to Domestic Industry of Valves for Pneumatic Transmissions  Imported from 
Japan, 20  January 2015 (OTI's Final Report) (Panel Exhibits JPN -5b (public version) and KOR -2b (BCI)).  
5 Panel  Report, para.  2.5 (referring to MOSF, Decree No. 498, Regulation Concerning the Imposition of 
Anti-Dumping Duties on Valves for Pn eumatic Transmissions originating from Japan, 19  August  2015 (MOSF's 
Decree No. 498) (Panel Exhibit JPN -6b); MOSF, Public Announcement No. 2015 -156, Decision to Apply 
Anti-Dumping Duties on the Pneumatic Transmissions Valves from Japan, 19  August  2015 (MOS F's Public 
Announcement) (Panel Exhibit KOR -3b (BCI))).  
6 Panel Report, paras.  1.3-1.4; Request for the Establishment of a Panel by Japan, WT/DS504/2 
(Japan's panel request).  
 WT/DS504/AB/R  
 
- 11 - 
 
  working procedures, additional working procedures concerning business confidential information 
(BCI), and timetable.7 
1.4.  In the Request for the Establishment of a Panel by Japan (Japan's panel request), Japan 
requested the Panel to find that the measure at issue is inconsistent with Korea's obligations under 
Articles  3.1 and 3.2, Articles  3.1 and 3.4, Articles  3.1 and 3.5, Articles  3.1 and  4.1, Article  6.5, 
Article  6.5.1, Article  6.9, Article  12.2, and Article 12.2.2 of the Anti -Dumping Agreement .8 As a 
consequence of these inconsistencies, Japan also claimed that Korea acted inconsistently with 
Article  1 of the Anti -Dumping Agreement  and Article  VI of the GATT  1994.9 
1.5.  On 24  November  2016, Korea filed a request for the Panel to issue a preliminary ruling that 
Japan's claims under Articles  3.1, 3.2, 3.4, 3.5, and 4.1 of the Anti -Dumping Agreement  were 
outside the Panel's terms of reference because Japan's panel request fa iled to "provide a brief 
summary of the legal basis of the complaint sufficient to present the problem clearly", as required 
by Article  6.2 of the Understanding on Rules and Procedures Governing the Settlement of Disputes 
(DSU).10 At the invitation of the P anel, Japan submitted a written response to Korea's request on 
16 December  2016. Korea responded to Japan's views in its first written submission. The 
European  Union and the United  States also provided their views on Korea's request in their 
respective thi rd party submissions.11 On 7 July 2017, the Panel informed the parties that, in view of 
the circumstances of the case and the extraordinary scope of Korea's request, which involved seven 
of the 13 claims raised by Japan in this dispute, the Panel had decide d not to issue a separate ruling 
on the matter of the sufficiency of Japan's panel request under Article  6.2 of the DSU, indicating that 
it would instead address the matter in the Panel  Report.12 
1.6.   In the Panel  Report , circulated to Members of the World Trad e Organization (WTO) 
on 12 April 2018, the Panel found that:  
a. the following claims in Japan's panel request failed to provide a brief summary of the legal 
basis of the complaint sufficient to present the problem clearly as required under 
Article  6.2 of the DSU and are therefore not within the Panel's terms of reference:13 
i. Japan's claim under Articles 3.1 and 4.1 of the Anti -Dumping Agreement  concerning 
the definition of the domestic industry14; 
ii. Japan's claim under Articles  3.1 and 3.2 of the Anti -Dumping Agreement  concerning 
Korea's analysis of an increase in the volume of the dumped imports15; 
iii. Japan's claim under Articles  3.1 and 3.2 of the Anti -Dumping Agreement  concerning 
the consideration of the effect of the dumped imports on prices16; 
iv. Japan's c laim under Articles  3.1 and 3.4 of the Anti -Dumping Agreement  concerning 
the impact of the dumped imports on the state of the domestic industry, with the 
exception of the allegations that the KTC and the OTI (Korean investigating authorities ) 
failed to eva luate two of the specific factors listed in Article  3.4, namely the ability to 
raise capital or investments, and the magnitude of the margin of dumping17; 
v. Japan's claim under Articles  3.1 and 3.5 of the Anti -Dumping Agreement  concerning 
the alleged failure by the Korean investigating authorities to consider adequately all 
known factors other than the dumped imports that were injuring the domestic industry 
                                                
7 Panel  Report, para.  1.7. The Panel revised its timetable, after consulting the parties, on 21  June and 
20 July 2017. (Ibid.)  
8 Panel Report, para.  3.1. See also Japan's panel request.  
9 Panel  Report, para.  3.1. 
10 Panel  Report, para.  1.12. 
11 Panel  Report, para.  1.13. 
12 Panel  Report, para.  1.14. 
13 Panel  Report, para.  8.1. 
14 Panel Repor t, paras.  7.67 and 8.1.a.  
15 Panel  Report, paras.  7.94 and 8.1.b.  
16 Panel  Report, paras.  7.131 and 8.1.c.  
17 Panel  Report, paras.  7.175 and 8.1.d.  
 WT/DS504/AB/R  
 
- 12 - 
 
  at the same time, with the exception of the allegations concerning whether the Korean 
investigating auth orities considered certain known factors in isolation and dismissed 
them without an adequate examination18; 
vi. Japan's claim under Article  6.9 of the Anti -Dumping Agreement  concerning the alleged 
failure by the Korean investigating authorities to inform intere sted parties of essential 
facts that formed the basis for the decision to impose definitive anti -dumping 
measures19; 
vii. Japan's claims under Articles  12.2 and 12.2.2 of the Anti -Dumping Agreement  
concerning the alleged failure by the Korean investigating autho rities to give proper 
public notice of their final determination20; and 
viii. Japan's consequential claim under Article  VI of the GATT  199421; and 
b. the following  claims in  Japan's panel request provided a brief summary of the legal basis 
of the complaint sufficient to present the problem clearly pursuant to Article  6.2 of the 
DSU and are therefore properly within  the Panel's terms of reference :22 
i. Japan's claim under Articles  3.1 and 3.4 of the Anti -Dumping Agreement  concerning 
the alleged failure of the Korean investigating authorities to evaluate the ability to 
raise capital or investments, and the magnitude of the margin of dumping under 
Article  3.423; 
ii. Japan's claim under Articles 3.1 and 3.5 of the Anti -Dumping Agreement  that the 
Korean investigating authorities' demonstration of causation lacks a foundation in its 
analyses of volume of dumped imports, effects of imports on prices, and the impact of 
those imports on the dome stic industry, irrespectively and independently of whether 
the Korean investigating authorities' analyses are found to be inconsistent with 
Articles  3.1, 3.2, and 3.4 of the Anti -Dumping Agreement24; 
iii. Japan's claim under Articles  3.1 and 3.5 of the Anti -Dump ing Agreement  concerning 
the alleged failure by the Korean investigating authorities to demonstrate any causal 
relationship between the dumped imports and the injury to the domestic industry25; 
iv. Japan's claim under Articles  3.1 and 3.5 of the Anti -Dumping Ag reement  concerning 
the alleged failure of the Korean investigating authorities to examine certain known 
factors adequately and their examination of those factors in isolation26; 
v. Japan's claims under Articles  6.5 and 6.5.1 of the Anti -Dumping Agreement  conce rning 
the treatment of confidential information and the provision of non -confidential 
summaries of information for which confidential treatment was sought by the 
applicants27; and  
vi. Japan's consequential claim under Article  1 of the Anti -Dumping Agreement .28 
                                                
18 Panel  Report, paras.  7.243 and 8.1.e.  
19 Panel  Report, paras.  7.517 and 8.1.f.  
20 Panel  Report, paras.  7.540 an d 8.1.g.  
21 Panel  Report, paras.  7.549 and 8.1.h.  
22 Panel  Report, para.  8.2. 
23 Panel  Report, paras.  7.175 and 8.2.a.  
24 Panel  Report, paras.  7.226 and 8.2.b.  
25 Panel  Report, paras.  7.235 and 8.2.c.  
26 Panel  Report, paras.  7.243 and 8.2.d.  
27 Panel  Report, paras.  7.418 and 8.2.e.  
28 Panel  Report, paras.  7.549 and 8.2.f.  
 WT/DS504/AB/R  
 
- 13 - 
 
  1.7.  For the claims that the Panel found to be within its terms of reference, the Panel found that:  
a. with respect to Japan's claim under Articles  3.1 and 3.4 of the Anti -Dumping Agreement : 
i. Japan did not establish that the Korean investigating authorities acted inconsistently 
with Articles  3.1 and 3.4 in their consideration of the two factors listed in Article  3.4., 
namely the ability to raise capital or investments and the magnitude of the margin of 
dump ing29; 
b. with respect to Japan's claims under Articles  3.1 and 3.5 of the Anti -Dumping Agreement : 
i. Japan did not establish that the Korean investigating authorities acted inconsistently 
with Articles  3.1 and 3.5 with respect to their conclusion that the dumped  imports, 
through the effects of dumping, were causing injury to the domestic industry30; 
ii. Japan did not establish that the Korean investigating authorities acted inconsistently 
with Articles  3.1 and 3.5 with respect to their examination of known factors other than 
the dumped imports that were injuring the domestic industry at the same time31; and 
iii. Japan demon strated  that the Korean investigating authorities acted inconsistently with 
Articles  3.1 and 3.5  in their causation analysis as a result of flaws in their analysis of 
the effect of the dumped imports on prices in the domestic market32; 
c. with respect to Japan 's claim under Articles  6.5 and 6.5.1 of the Anti -Dumping Agreement : 
i. Japan demonstrated  that the Korean investigating authorities acted inconsistently with 
Article  6.5 with respect to their treatment of  information provided by the applicants as 
confidentia l without requiring that good cause be shown33; and 
ii. Japan demonstrated  that the Korean investigating authorities acted inconsistently with 
Article  6.5.1 with respect to their failure  to require that the submitting parties provide 
a sufficient non -confidenti al summary of the information for which confidential 
treatment was sought34; and  
d. with respect to Japan's claim under Article  1 of the Anti -Dumping Agreement : 
i. Japan demonstrated  that the Korean investigating authorities acted inconsistently with 
Article  1 as a consequence of and to the extent that they acted inconsistently with 
Articles  3.1 and 3.5, and Articles  6.5 and 6.5.1 , of the Anti -Dumping Agreement .35  
1.8.  In accordance  with Article 19.1 of the DSU, and having found that Korea acted inconsistently 
with certain provisions of the Anti -Dumping Agreement , the Panel recommended that Korea bring 
its measure into conformity with its obligations under that Agreement.36 
1.9.  On 28  May 2018, Japan notified the Dispute Settlement Body (DSB), pursuant to Articles  16.4 
and 17 of the DSU, of its intention to appeal certain issues of law covered in the Panel  Report  and 
certain legal interpretations developed by the Panel, and filed a Notice of Appea l and an appellant's 
submission37 pursuant to Rule  20 and Rule 21, respectively, of the Working Procedures for Appellate 
Review38 (Working  Procedures). On 4  June 2018, Korea notified the DSB, pursuant to Articles  16.4 
and 17 of the DSU, of its intention to a ppeal certain issues of law covered in the Panel  Report  and 
                                                
29 Panel  Report, paras.  7.192 and 8.3.a.  
30 Panel  Report, paras.  7.361 and 8.3.b.  
31 Panel  Report, paras.  7.389 and 8.3.c.  
32 Panel  Report, p aras. 7.349 and 8.4.a.  
33 Panel  Report, paras.  7.441, 7.451, and 8.4.b.  
34 Panel  Report, paras.  7.450 -7.451 and 8.4.c.  
35 Panel Report, paras.  7.552 -7.553 and 8.4.d.  
36 Panel  Report, para.  8.6. 
37 WT/DS504/5.  
38 WT/AB/WP/6, 16  August  2010.  
 WT/DS504/AB/R  
 
- 14 - 
 
  certain legal interpretations developed by the Panel, and filed a Notice of Other Appeal39 and an 
other appellant's submission , pursuant to Rule  23 of the Working Procedures . 
1.10.   On 30  May 2018, the Chair of the Appellate  Body received a communication from the 
European  Union requesting the Division hearing this appeal to extend the deadline for the filing of 
third participants'  submissions to allow for sufficient time for third par ticipants to consider and react 
to the appellees' submissions. On 31  May 2018, on behalf of the Division hearing this appeal, the 
Chair of the Appellate  Body invited Korea, Japan, and other third participants in this dispute to 
comment in writing on the co mmunication from the European  Union.40 On 6 June 2018, the Chair, 
on behalf of the Division hearing the appeal, issued a Procedural Ruling extend ing the deadline for 
filing third participants' submissions and notifications under Rule 24(1) and (2) of the Wo rking 
Procedures to 22  June 2018.41 
1.11.   On 15  June 2018, Japan and Korea each filed an appellee's submission.42 On 22  June 2018, 
the European  Union and the United  States each filed a third participant's submission.43 On the same 
day, Canada and Singapore each not ified its intention to appear at the oral hearing as a third 
participant.44 On the same day, Norway, Turkey, and Viet  Nam each notified its intention to reserve 
its right to attend the oral hearing, while Brazil, China,  and Ecuador each notified the same on  
25 June 2018.45 
1.12.   By letter dated 27  July 2018, the Chair of the Appellate  Body notified the Chair of the DSB 
that the Appellate  Body would not be able to circulate its Report within the 60 -day period pursuant 
to Article  17.5 of the DSU, or within the 90 -day period pursuant to the same provision, for the 
reasons mentioned therein.46 For the reasons explained in the letter, work on this appeal could 
gather pace only in January 2019.  On 9 July 2019, the Chair of the Appellate  Body notified the Chair 
of the DSB that the Appellate  Body Report in these proceedings would be circulated to WTO  Members 
no later than  10 September  2019.47 
1.13.   By letter dated 28  September  2018, the participants and third participants were informed that 
the Chair of the Appellate  Body had notified the Chair of the DSB that Mr  Shree Baboo Chekitan 
Servansing had been authorized  by the Appellate  Body, pursuant to Rule 15 of the Working 
Procedures, to complete the disposition of this appeal, although his term of offic e would expire before 
the completion of these appellate proceedings.  
1.14.   On 4 March  2019, the Presiding Member of the Division hearing this appeal received a joint 
communication from Japan and Korea requesting the Division to adopt additional working procedure s 
for the protection of BCI, pursuant to Article  16(1) of the Working Procedures. On 5  March  2019, 
the Presiding Member of the Division invited the third participants to provide comments on the joint 
communication by the participants. No responses were rec eived from the third participants. On 
26 March  2019, the Division issued a Procedural Ruling on the protection of the information marked 
by the participants as BCI in their submissions to the Appellate  Body and the information designated 
by the Panel as BC I in its Report and on the Panel record.48 
1.15.   The hearing in this appeal was held on 3-4 April 2019. The participants and two of the third 
participants ( the European  Union and Norway)  made oral statements. During the hearing, the 
                                                
39 WT/DS504/6 . 
40 The Ch air received a letter from each participant indicating that they did not have specific comments 
on this matter.  
41 Contained in Annex D  of the Addendum to this Report (WT/DS504/AB/R/Add.1).  
42 Pursuant to Rules 22 and 23(4) of the Working Procedures.  
43 Pursuant to Rule 24(1) of the Working Procedures.  
44 Pursuant to Rule 24(2) of the Working Procedures.  
45 Pursuant to Rule 24(4) of the Working Procedures.  
46 WT/DS504/7. The Chair of the Appellate  Body explained that, i n view of the backlog of appeals 
pendi ng, and the overlap in the composition of all divisions resulting in part from the reduced number of 
Appellate  Body Members, it would not be possible for the Division to focus on the consideration of this appeal 
for some time, that is, schedule internal me etings, fully staff it, and schedule the hearing. (Ibid.)  
47 WT/DS504/8.  
48 Contained in Annex D of the Addendum to this Report (WT/DS504/AB/R/Add.1).  
 WT/DS504/AB/R  
 
- 15 - 
 
  participants and the third par ticipants also responded to questions posed by the Members of the 
Division hearing this appeal.   
2  ARGUMENTS  OF THE PARTICIPANTS  
2.1.  The claims and arguments of the participants are reflected in the executive summaries of their 
written submissions provided to th e Appellate  Body.49 The Notice of Appeal and the executive 
summaries of the participants' claims and arguments are contained in Annexes A and B of the 
Addendum to this Report, WT/DS504/AB/R/Add.1.  
3  ARGUMENTS  OF THE THIRD PARTIC IPANTS  
3.1.  The arguments of the thi rd participants that filed a written submission (the European  Union 
and the United  States) are reflected in the executive summaries of their written submissions 
provided to the Appellate  Body50 and are contained in Annex C of the Addendum to this Report, 
WT/DS504/AB/R/Add.1.  
4  ISSUES RAISED  
4.1.  The following  issues are raised in this appeal:  
a. with respect to Japan's claim under Articles  3.1 and 4.1 of the Anti -Dumping  Agreement 
(raised by Japan):  
i. wheth er the Panel erred in finding that Japan's panel request, as it relates to the claim 
under Articles  3.1 and 4.1 of the Anti -Dumping Agreement  concerning the Korean 
investigating authorities' definition of  the domestic industry (claim 7), failed to comply 
with the requirements of Article  6.2 of the DSU and, consequently, in finding that this 
claim was outside the Panel's terms of reference; and  
ii. if the Appellate  Body were to find that the Panel erred in  finding that Japan's claim 7 
was outside its  terms of reference, whether the Appellate  Body can complete the legal 
analysis and find  that the Korean investigating authorities' definition of the domestic 
industry was inconsistent with Articles  3.1 and  4.1 of the Anti -Dumping Agreement;  
b. with respect t o Japan's claims under Article  3 of the Anti -Dumping Agreement : 
i. whether the Panel erred in finding that Japan's panel request, as it relates to the 
following claims, failed to comply with the requirements of Article  6.2 of the DSU and, 
consequently, in fin ding that these claims were outside the Panel's terms of reference 
(raised by Japan) :  
• the claim  under Articles  3.1 and 3.2 of the Anti -Dumping Agreement  concerning 
the Korean investigating authorities' consideration of the volume of the dumped 
imports (claim 1);  
• the claim under Articles  3.1 and 3.2 of the Anti -Dumping Agreement  concerning 
the Korean investigating authorities' consideration of the effects of the dumped 
imports on price (claim 2);  and 
• the claim  under Articles  3.1 and 3.4 of the Anti -Dumping Agreement  concerning 
the Korean investigating authorities' examination of the impact of the dumped 
imports on the domestic industry (part of claim 3);  
                                                
49 Pursuant to the Appellate  Body's communication on "Executive Summaries of Written Submissions in 
Appellat e Proceedings" and "Guidelines in Respect of Executive  Summaries of Written Submissions in 
Appellate  Proceedings" (WT/AB/23, 11  March 2015).  
50 Pursuant to the Appellate  Body's communication on "Executive Summaries of Written Submissions in 
Appellate Procee dings" and "Guidelines in Respect of Executive  Summaries of Written Submissions in 
Appellate  Proceedings" (WT/AB/23, 11  March 2015).  WT/DS504/AB/R  
 
- 16 - 
 
  ii. whether the Panel erred  in finding that Japan's panel request , as it relates to the 
following claims, complied with the requirements of Article  6.2 of the DSU and, 
consequently, in finding that these claims were within its terms of reference (raised 
by Korea ): 
• the claim  under Articles  3.1 and 3.5 of the Anti -Dumping Agreement  that the 
Korean investigating authorities failed to properly establish a causal link between 
the dumped imports and the alleged injury (claim 4);  
• the claim under Articles  3.1 and 3.5 of the Anti -Dumping Agreement  concerning 
the Korean investigating authorities' non -attribution analysis (part of claim 5);  and 
• the claim under Articles  3.1 and 3.5 of the Anti -Dumping Agreement  that the 
Korean investigating authorities' causation determinatio n was undermined by its 
flawed price effects and volume analyses under Article  3.2, and by its flawed 
impact analysis under Article  3.4, "irrespective and independent" of whether these 
analyses were found to be inconsistent with Articles  3.2 and 3.4 (claim  6); 
iii. whether  the Panel erred in finding that Japan failed to establish that the Korean 
investigating authorities acted inconsistently with Articles  3.1 and 3.4 of the 
Anti-Dumping Agreement in their evaluation of the magnitude of the margin of 
dumping for purposes of examining the impact of the dumped imports on the domestic 
industry (raised by Japan);  
iv. whether  the Panel erred in its interpretation or application of Articles  3.1 and 3.5 of 
the Anti -Dumping  Agreement in resolving Japan's claim 6 (raised by th e participants);  
v. whether  the Panel erred in its interpretation or application of Articles  3.1 and 3.5 of 
the Anti -Dumping  Agreement in resolving Japan's claim 4 (raised by Japan);  
vi. if the Appellate  Body were to find that the Panel erred in finding that Japan's claim 1 
was outside its terms of reference, whether the Appellate  Body can complete the legal 
analysis and find that the Korean investigating authorities acted inconsistently with 
Articles  3.1 and 3.2 of the Anti -Dumping Agreement  in their consideration of the 
volume of the dumped imports in the anti -dumping investigation at issue (raised by 
Japan);  
vii. if the Appellate  Body were to find that the Panel erred in finding that Japan's claim 2 
was outside i ts terms of reference, whether the Appellate  Body can complete the legal 
analysis and find that the Korean investigating authorities acted inconsistently with 
Articles  3.1 and 3.2 of the Anti -Dumping Agreement in their consideration of the 
effects of the d umped imports on prices in the anti -dumping investigation at issue 
(raised by Japan); and  
viii. if the Appellate  Body were to find that the Panel erred in finding that part of Japan's 
claim 3 was outside its terms of reference, whether the Appellate  Body can com plete 
the legal analysis and find that the Korean investigating authorities acted 
inconsistently with Articles  3.1 and 3.4 of the Anti -Dumping Agreement in their 
determination of the impact of the dumped imports on the domestic industry in the 
anti-dumping  investigation at issue (raised by Japan);  
c. with respect to Japan's claim s under Articles  6.5 and 6.5.1 of the Anti -Dumping Agreement  
(raised by Korea):  
i. whether the Panel erred in finding that Japan's panel request, as it relates to the claims 
under, respec tively, Articles  6.5 and 6.5.1 of the Anti -Dumping Agreement  concerning 
the confidential treatment of information (claims 8 and 9), complied with the 
requirements of Article  6.2 of the DSU and, consequently, were within its terms of 
reference;  WT/DS504/AB/R  
 
- 17 - 
 
  ii. whether  the Panel erred in its interpretation or application of Article  6.5 of the 
Anti-Dumping Agreement in finding that the Korean investigating authorities acted 
inconsistently with this provision by treating certain information as confidential without 
"good cause"  having been shown ; and  
iii. whether the Panel erred in its application of Article  6.5.1 of the Anti -Dumping 
Agreement in finding that the Korean investigating authorities acted inconsistently with 
this provision by failing to require that the submitting partie s provide a sufficient 
non-confidential summary of the information for which confidential treatment was 
sought; and  
d. with respect to Japan's claim under Article  6.9 of the Anti -Dumping Agreement  (raised by 
Japan):  
i. whether the Panel erred in finding that Jap an's panel request, as it relates to the claim 
under Article  6.9 of the Anti -Dumping Agreement  concerning the disclosure of 
essential facts (claim 10), failed to comply with the requirements of Article  6.2 of the 
DSU and, consequently, in finding that this claim was outside the Panel's terms of 
reference; and  
ii. if the Appellate  Body were to find that  the Panel erred in finding  that Japan's claim 10 
was outside its  terms of reference, whether the Appellate  Body can complete the legal 
analysis and find that Korea acted inconsistently with Article  6.9 of the Anti -Dumping 
Agreement  because the Korean inve stigating authorities failed to disclose the 
"essential facts" under consideration before the final determination was made.  
5  ANALYSIS OF THE APPELLATE  BODY  
5.1.  As noted in paragraph 1.5 above, the Panel did not issue a separate ruling on Korea's challenge 
of the sufficiency of Japan's panel request with respect to all of the claims contained therein51, but 
instead addressed the issues regarding the sufficiency of Japan's panel request in its final Report.  
5.2.  In its final Report, the Panel began by articulating its overarching understanding of the relevant 
legal standard under Article  6.2 of the DSU.52 The Panel then addressed each of the claims raised in 
Japan's panel request, starting with Japan's claim regarding the Korean investigating authorities' 
definition of the domestic industry, followed by, inter alia , the claims concerning the Korean 
investigati ng authorities' injury determination, treatment of confidential information, and disclosure 
of essential facts.53 For each claim, the Panel began by determining whether it fell within its terms 
of reference in light of the legal standard under Article  6.2 of the DSU. For those claims found to be 
within its terms of reference, the Panel proceeded to examine  the merits of each of them pursuant 
to the relevant provisions of the Anti -Dumping Agreement. In our analysis below, we largely follow 
the same order, beg inning with a review of the legal standard under Article  6.2 and our 
understanding of the Panel's articulation of this standard. We then turn to the appeal of the Panel's 
findings on Japan's claim regarding the Korean investigating authorities' definition of the domestic 
industry, followed by the appeals of the Panel's findings on Japan's claims regarding  the Korean 
investigating authorities' determination of injury, treatment of confidential information, and 
disclosure of essential facts.  
5.1  Overall consider ations regarding the legal standard under Article  6.2 of the DSU  
5.1.1   The legal standard under Article  6.2 of the DSU  
5.3.  Article  6.2 of the DSU provides, in relevant part:  
                                                
51 See also Panel  Report, para.  7.16. 
52 Panel  Report, paras.  7.18-7.27. 
53 The Panel's findings on Japan's remaining claims, brought under Articles  12.2 and 12.2.2 of the 
Anti-Dumping Agreement, are not subject to appeal.  
 WT/DS504/AB/R  
 
- 18 - 
 
  The request for the establishment of a panel shall be made in writing. It shall indicate 
whether consultations were held, identify the specific measures at issue and provide a 
brief summary of the legal basis of the complaint sufficient to present the problem 
clearly.  
5.4.  The requirements under Article  6.2 of the DSU are " central to the establishmen t of the 
jurisdiction of a panel ".54 A panel request governs a panel's terms of reference and delimits the 
scope of the panel's jurisdiction.55 In addition, by establishing and defining the jurisdiction of the 
panel, "the panel request also fulfils a due process objective" by providing the respondent and third 
parties with notice regarding the nature of the complainant's case and enabling them to  respond 
accordingly.56  
5.5.  In assessing whether a panel request is sufficiently precise to meet the requirements of 
Article  6.2 of the DSU, panels must "scrutinize carefully the panel request, read as a whole, and on 
the basis of the language used".57 Whether a panel request complies with the requirements of 
Article  6.2 of the DSU must therefore be determined on the face of the panel request58, on a  
case-by-case basis.59 Defects in the request for the establishment of a panel cannot be cured in the 
subsequent su bmissions of the parties during the panel proceedings. However, "in considering the 
sufficiency of a panel request, submissions and statements made during the course of the panel 
proceedings, in particular the first written submission of the complaining pa rty, may be consulted in 
order to confirm the meaning of the words used in the panel request."60 
5.6.  The present  dispute concerns whether Japan's panel request has identified the legal basis of 
the complaint with sufficient clarity, and does not pertain to the identification of "the specific 
measures at issue". At the centre of the dispute is the question whether Japan's panel request 
"provide[d] a brief summary of the legal basis of the complaint sufficient to present the problem 
clearly"  within the meaning of the latter part of the second sentence of Article  6.2 of the DSU . 
Pursuant to this requirement,  while the summary of the legal basis may be "brief", the degree of 
brevity that is permissible under Article  6.2 is a function of its clarity in presenting the problem. The 
Appellate  Body has found that , to meet this requirement,  a panel request must "plainly connect the 
challenged measure(s) with the provision(s) of the covered agreements claimed to have been 
infringed".61 The identification of the treaty provisi on claimed to have been violated is "always 
necessary" and a "minimum prerequisite".62 At the same time, depending on the particular 
circumstances of a case, the identification of the treaty provision  alleged to have been breached 
may not alone be sufficient to comply with the requirements of Article  6.2. For example, "to the 
extent that a provision contains not one single, distinct obligation, but rather multiple obligations, a 
panel request might need to specify which of the obligations contain ed in the provision is being 
                                                
54 Appellate  Body Report, US – Countervailing Measures (China) , para.  4.6. 
55 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.12. See also 
Appellate  Body Reports, EC and certain member States – Large Civil Aircraft , para.  640; US – Countervailing 
Measures (China) , para.  4.6; US – Countervailing and Anti -Dumping Measures  (China) , para. 4.6. 
56 Appellate  Body Report, US – Countervailing and Anti -Dumping Measures  (China) , para.  4.7 (referring 
to Appellate  Body Reports, Brazil – Desiccated Coconut , p. 22, DSR 1997:I, p.  186; Chile – Price Band System , 
para. 164; Thailand – H-Beams , para.  88; US – Continued Zeroing , para.  161).  
57 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU ), para. 5.13 (quoting 
Appellate  Body Report, EC – Fasteners (China) , para.  562 (fn omitted)).  
58 Appellate  Body Reports, US – Carbon Steel , para.  127; China – HP-SSST (Japan) / China  – HP-SSST 
(EU), para.  5.13. 
59 Appellate  Body Reports, Korea – Dairy , para.  127; China – Raw Materials , para.  220; 
US – Countervailing and Anti -Dumping Measures (China) , para.  4.17. 
60 Appellate  Body Report , US – Carbon Steel , para.  127 (referring to Appellate  Body Report, 
Thailand  – H-Beams , para.  95). See also Appellate  Body Reports, China – Raw Materials , para. 220; 
China  – HP-SSST (Japan) / China – HP-SSST (EU ), para. 5.13. 
61 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU ), para.  5.15 (quoting 
Appellate  Body Reports, China – Raw Materials , para.  220; US – Countervailing and Anti -Dumping Measures 
(China) , para.  4.8, in turn quoting Appellate  Body Report, US – Oil Country Tubular Goods Sunse t Reviews , 
para. 162). See also Appellate  Body Report, US – Countervailing Measures (China) , para.  4.9. 
62 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU ), para. 5.14 (quoting 
Appellate  Body Report, Korea – Dairy , para.  124, in turn r eferring to Appellate  Body Reports, 
Brazil  – Desiccated Coconut , p. 22, DSR 1997:I, p.  186; EC – Bananas III , paras.  145 and  147; India – Patents 
(US), paras.  89 and 92 -93). 
 WT/DS504/AB/R  
 
- 19 - 
 
  challenged."63 Thus, in light of the requirement to consider the sufficiency of a panel request on its 
face and on a case -by-case basis, what is sufficient to "plainly connect " the measure with the 
provision of the covered agree ments claimed to have been infringed will also depend on the 
circumstances of each case. Such circumstances may include the nature of the measure at issue and 
the manner in which it is described in the panel request, as well as the nature of the provision of the 
covered agreements alleged to have been breached.64 In addition, a panel request need only provide 
the "legal basis of the complaint", that is, the claims  underlying this complaint and not the arguments  
in support thereof.65 
5.7.  The Appellate  Body has als o on three occasions indicated that a brief summary of the legal 
basis of the complaint required by Article  6.2 of the DSU "aims to explain succinctly how or why the 
measure at issue is considered by the complaining Member to be violating the WTO obligatio n in 
question".66 For example, in EC – Selected Customs  Matters , the Appellate  Body used the phrase 
"how or why" in connection with the requirement that the summary of the legal basis "be sufficient 
to present the problem clearly".67 Subsequently, in China – Raw Materials , the Appellate  Body 
considered that the panel request in that dispute failed to explain succinctly how or why the measure 
at issue is inconsistent with the WTO obligation in question because the panel request failed to 
connect the different measures with the various obligations listed therein.68 Thus, the use of the 
phrase "how  or why" in these cases does not imply a new and different legal standard for complying 
with the requirements of Article  6.2 of the DSU. As described above, the applicab le legal standard, 
which requires a "brief summary of the legal basis … sufficient to present the problem clearly", 
entails the consideration of whether the panel request plainly connects the measure with the 
provision of the covered agreements claimed to have been infringed. The sufficiency of a panel 
request under this standard is to be assessed on a case -by-case basis.  
5.8.  In sum,  the requirements under Article  6.2 of the DSU are central to the proper establishment 
of the jurisdiction of a panel . A panel re quest governs a panel's terms of reference and delimits the 
scope of the panel's jurisdiction. In addition, by establishing and defining the jurisdiction of the 
panel, the panel request also fulfils a due process objective by providing the respondent and t hird 
parties with notice regarding the nature of the complainant's case and  by enabling them to respond 
accordingly. Whether a panel request complies with the requirements of Article  6.2 of the DSU must 
be determined on the face of the panel request, on a case-by-case basis. Defects in the request for 
the establishment of a panel cannot be cured in the subsequent submissions of the parties during 
the panel proceedings. However, in considering the sufficiency of a panel request, submissions and 
statements ma de during the course of the panel proceedings, in particular the first written 
submission of the complaining party, may be consulted in order to confirm the meaning of the words 
used in the panel request.  
5.9.  In order to "provide a brief summary of the legal basis of the complaint sufficient to present 
the problem clearly" pursuant to Article  6.2 of the DSU, a panel request must plainly connect the 
measure(s) with the provision(s) of the covered agreements claimed to have been infringed. The 
identification of the treaty provision claimed to have been violated by the respondent is "always 
necessary" and a "minimum prerequisite"69, but may not be sufficient to meet the above requirement 
of Article  6.2 depending on the particular circumstances of a case. Such circumstances include the 
                                                
63 Appellate  Body Report, US – Countervailing Measures (China) , para.  4.9 (quoting Appellate  Body 
Reports, China – Raw Materials , para.  220, in turn referring to Appellate  Body Reports, Korea – Dairy , 
para. 124; EC – Fasteners (China) , para.  598; US – Countervailing and Anti -Dumping Measures (China) , 
para. 4.8). 
64 See Appellate  Body Repo rt, US – Countervailing Measures (China) , para.  4.9. 
65 See para.  5.31 below. See also Appellate  Body Reports, China – HP-SSST (Japan) / China  – HP-SSST 
(EU), para. 5.14; Korea – Dairy , para.  139; US – Countervailing Measures (China) , para.  4.9. 
66 Appellate  Body Report, EC – Selected Customs Matters , para.  130. (emphasis original) See also 
Appellate  Body Reports, China – Raw Materials , para.  226; US – Countervai ling Measures (China) , para.  4.9. 
67 Appellate  Body Report, EC – Selected Customs Matters , para.  130. 
68 Appellate  Body Reports, China – Raw Materials , para.  266. In that dispute, the panel request listed 37 
legal instruments as the measures at issue and all eged them to be inconsistent with 13 provisions of the 
covered agreements. The Appellate  Body noted that it was "not clear which allegations of error pertain to 
which particular measure or set of measures identified in the panel requests". (Ibid., paras.  226 and  229) 
69 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU ), para. 5.14 (quoting 
Appellate  Body Report, Korea – Dairy , para.  124, in turn referring to Appellate  Body Reports, 
Brazil  – Desiccated Coconut , fn 21 at p.  22, DSR 1997:I,  p. 186; EC – Bananas III , paras.  145 and  147; 
India – Patents (US) , paras.  89 and 92 -93). 
 WT/DS504/AB/R  
 
- 20 - 
 
  nature of the measure at issue and the manner in which it is described in the panel request, as well 
as the nature of the provision of the covered agreements alleged to have been breached.  
5.1.2   Whether the Panel erred in i ts articulation of the applicable legal standard under 
Article  6.2 of the DSU  
5.10.   The Panel recalled that a panel request serves a dual function, because it: (i) "forms the basis 
for a panel's terms of reference under Article  7.1 of the DSU"; and (ii) "informs  other WTO  Members 
of the nature of the dispute, which in turn allows the respondent to prepare its defence and allows 
other Members to assess whether they have an interest in the matter, for example, to decide whether 
to participate as third parties".70 The Panel noted that compliance with the requirements under 
Article  6.2 must be demonstrated on the face of the panel request71, and that later submissions and 
statements by the parties may only be considered to confirm the meaning of the words used in the 
panel request and  to assess whether the ability of the respondent to defend itself was prejudiced.72 
With respect to the requirement in Article  6.2 to provide a brief summary of the legal basis of the 
complaint sufficient to present the problem clearly, the P anel said that the "legal basis of the 
complaint" refers to the "claims" made by the complaining party.73 For this purpose, the Panel 
distinguished between "claims" and "arguments"  by noting that a  panel request must identify the 
claims put forward by the c omplainant but need not identify the complainant's arguments .74  
5.11.   Furthermore, the Panel indicated that "a panel request must plainly connect the challenged 
measures with the provisions of the covered agreements claimed to have been infringed, so that the 
responding party is aware of the basis for the alleged nullification or impairment of the complaining 
party's benefits."75 The Panel noted that the narrative of a panel request "functions to explain 
succinctly how or why the measure at issue is considered by the complaining Member to be violating 
the WTO obligations in question".76 To the Panel, as a minimum requirement, a complainant must 
list in the panel request the provisions of the covered agreements claimed to have been violated. 
The Panel noted, however,  that there are situations in which a "mere listing" of treaty provisions 
does not satisfy the standards of clarity in the statement of the legal basis of the complaint required 
by Article  6.2.77 The Panel further stated that whether the listing of a treaty  provision allegedly 
violated is sufficient to constitute a "brief summary of the legal basis of the complaint sufficient to 
present the problem clearly" depends on the circumstances of each case, and in particular the extent 
to which a mere reference to a  treaty provision sheds light on the nature of the obligation at issue.78 
5.12.   In its articulation of the relevant legal standard under Article  6.2 of the DSU, the Panel rightly 
noted the dual function of the panel request in establishing the terms of reference and fulfilling a 
due process objective by providing notice to other Members of the nature of the dispute. The Panel 
also rightly indicated that the consistency of the panel request is to be established on a case -by-case 
basis, and that the panel request mu st connect the challenged measure with the provision of the 
covered agreement claimed to have been infringed such that it provides a brief summary of the legal 
basis of the complaint sufficient to present the problem clearly by, at a minimum, identifying t he 
provision in question. With regard to the Panel's reference to the function of the panel request to 
                                                
70 Panel  Report, para.  7.19 (referring to Appellate  Body Reports, Brazil – Desiccated Coconut , p. 22, 
DSR 1997:I, p.  186; EC – Bananas III , para.  142; US – Carbon Ste el, para.  126; US – Continued Zeroing , 
para. 161; US – Zeroing (Japan) (Article  21.5 – Japan) , para.  108).  
71 Panel  Report, para.  7.20. 
72 Panel  Report, para.  7.20 (referring to Appellate  Body Reports, US – Carbon Steel , para.  127; 
Australia  – Apples , para.  418).  
73 Panel  Report, para.  7.21 (referring to Appellate  Body Report, Guatemala – Cement I , para.  72). 
74 Panel  Report, para.  7.22 (referring to Appellate  Body Reports, Korea – Dairy , para.  139; 
EC – Bananas III , para.  141).  
75 Panel  Report, para.  7.24 (refe rring to Appellate  Body Report, US – Oil Country Tubular Goods Sunset 
Reviews , para. 162).  
76 Panel  Report, para.  7.24 (referring to Appellate  Body Reports, EC – Selected Customs Matters , 
para. 130; China – Raw Materials , para.  226; US – Countervailing and Anti-Dumping Measures (China) , 
para. 4.26). (emphasis original)  
77 Panel  Report, para.  7.26 (referring to Appellate  Body Report, Korea – Dairy , para.  124). By way of 
example, the Panel noted that this would be the case where the provisions listed in the panel request establish 
not one single, distinct obligation, but rather multiple obligations. (Ibid.)  
78 Panel  Report, para.  7.27 (referring to Panel  Reports, EC – Approval and Marketing of Biotech 
Products , para.  7.47; Preliminary Ruling by the Panel on th e Consistency of the Complaining Parties' Panel 
Requests with Article 6.2 of the DSU, para.  79). 
 WT/DS504/AB/R  
 
- 21 - 
 
  "explain succinctly how or why the measure at issue is considered … to be violating the WTO 
obligations in question"79, we reiterate our understanding set out in paragraph  5.7 above. 
Specifically,  the reference to the phrase "how or why" in certain past disputes does not indicate a 
standard different from the requirement that a panel request include a  "brief  summary of the legal 
basis … sufficient to present the problem clearly" within the meaning of Article  6.2 of the DSU.  
5.13.   The Panel went on to make certain observations regarding the relevance of the obligation 
under Article  3.1 of the Anti -Dumping Agreement for purposes of assessing the sufficiency of the 
panel request in this dispute. The Panel no ted that, of the 13 claims set out in Japan's panel request, 
7 relate to Korea's injury determination, each of which invokes Article  3.1 of the Anti -Dumping 
Agreement together with another subparagraph of Article  3 or, in 1 claim, Article  4.1 of the 
Anti-Dumping Agreement.80 For purposes of its findings under Article  6.2 of the DSU, the Panel 
considered it useful to explain its understanding of the legal framework for injury determinations so 
as to "provide the context for [its] consideration of whether the claims raised by Japan are properly 
before the Panel".81 The Panel noted that the provisions of Article  3 of the Anti -Dumping Agreement 
are interrelated in the sense that the required elements under Article  3 all contribute to the 
explanation of the ultimat e determination of whether dumped imports are causing injury to the 
domestic industry of the importing Member.82 In this regard, the Panel indicated that Article  3.1 
functions as a chapeau  and informs the rest of Article  3, such that it is an "overarching provision " 
that sets forth a Member's fundamental obligation with respect to the determination of injury, and 
"informs the more detailed obligations in succeeding paragraphs ".83 However, the Panel indicated 
that the princi ples set out in Article  3.1 "do not … establish independent obligations which can be 
judged in the abstract, or in isolation and separately from the substantive requirements set out in 
the remainder of Article  3".84  
5.14.   Noting that the requisite degree of spec ificity and clarity in a panel request must be examined 
on a case -by-case basis85, the Panel indicated at the same time that, "merely to mention the first 
part of Article  3.1, or use the language of that provision … in a panel request will not in itself nor mally 
suffice to present a problem clearly with respect to an allegation of violation of the Anti -Dumping 
Agreement."86 To the Panel, that would not, by itself, "explain how or why a complainant considers 
the measure at issue to be inconsistent with a speci fic obligation under the Anti -Dumping 
Agreement", or "be precise enough to serve the dual function of a panel request"  to define the basis 
for the Panel's terms of reference and to inform other WTO Members of the status  of the dispute .87 
Subsequently, in ap plying Article  6.2 of the DSU, the Panel relied, inter alia , on this reasoning in 
determining that certain of Japan's claims were not within its terms of reference.88 
5.15.   However, w e observe that, in the panel request, none of Japan's claims is limited to 
parap hrasing the language of Article  3.1 of the Anti -Dumping Agreement alone. Rather, Japan also 
identifies, at a minimum, another paragraph of Article  3 or Article  4 alleged to have been breached. 
Therefore, whether Japan's paraphrasing of Article  3.1, together with the remainder of the narrative 
                                                
79 Panel  Report, para.  7.24 (referring to Appellate  Body Reports, EC – Selected Customs Matters , 
para. 130; China – Raw Materials , para.  226; US – Countervailin g and Anti -Dumping Measures (China) , 
para. 4.26). (emphasis original)  
80 Panel  Report, para.  7.28 
81 Panel  Report, para.  7.29. 
82 Panel  Report, para.  7.30 (referring to Panel  Report, China – Cellulose Pulp , para.  7.10). The Panel 
indicated that the reference to "positive evidence" in Article  3.1 refers to "the facts underpinning and justifying 
the injury determination" and to "the quality of the evidence that an investigating authority may rely upon in 
making a determination", and that the term "positive" suggests that the evidence should be "affirmative, 
objective, verifiable, and credible". (Ibid., para.  7.32 (quoting Appellate  Body Reports, US – Hot-Rolled Steel , 
para. 193; China – GOES , para.  126; referr ing to Appellate  Body Report, US – Hot-Rolled Steel , para.  192; 
Panel  Report, China – Cellulose Pulp , para.  7.12)) Further, the Panel found that the reference to an "objective 
examination" in Article  3.1 relates to the investigative process itself, and req uires that the process "conform to 
the dictates of the basic principles of good faith and fundamental fairness" and be conducted "in an unbiased 
manner, without favouring the interests of any interested party, or group of interested parties, in the 
investi gation". (Ibid., para.  7.32 (quoting Appellate  Body Report, China – GOES , para.  126; referring to 
Appellate  Body Report, US – Hot-Rolled Steel , para.  193; Panel  Report, China  – Cellulose Pulp , para.  7.12))  
83 Panel  Report, para.  7.33 (quoting Appellate  Body Report, Thailand – H-Beams , para.  106).  
84 Panel  Report, para.  7.33 (quoting Panel  Report, China – Cellulose Pulp , para.  7.13).  
85 Panel  Report, para.  7.34. 
86 Panel  Report, para.  7.35. 
87 Panel  Report, para.  7.35. (emphasis original)  
88 See Panel  Report, para s. 7.64, 7.91, 7.129, and 7.173.  WT/DS504/AB/R  
 
- 22 - 
 
  contained in the panel request, including Japan's reference to the other provision (s) concerned, 
complies with the require ments of Article  6.2 should be assessed on a case -by-case basis, depending 
on the relevant circumstances of each claim. Thus, the fact that the narrative of Japan's claims, as 
set out in its panel request, paraphrases the language of Article  3.1, in and of  itself, is not dispositive 
of whether the panel request complies with Article  6.2 of the DSU.  
5.16.   We will proceed to determine whether the Panel erred in its application of the legal standard 
under Article  6.2 for each of the claims under appeal in the respe ctive sections below.  
5.2  Domestic industry  
5.17.   The Panel  found  that Japan's claim 7 , as listed in its panel request, which concerns the Korean 
investigating authorities' definition of the domestic industry, d id not meet the requirements of 
Article  6.2 of the DSU  and, consequently, was not within its terms of reference. Japan appeals this 
finding and requests the Appellate  Body to find that this claim is within the Panel's terms of 
reference. In addition, Japan requests the Appellate  Body to complete the legal analysis and find 
that the Korean investigating authorities acted inconsistently with Articles  3.1 and 4.1 of the 
Anti-Dumping Agreement in defining the domestic industry  in the anti -dumping investigation at 
issue. Korea, for its part, requests the Appellate  Body to uphold the Panel's finding under Article  6.2 
of the DSU. Should the Appellate  Body reverse the Panel's finding, Korea argues that the 
Appellate  Body cannot complete the legal analysis.  
5.18.   We will first assess whether the Panel erred in finding that J apan's claim concerning the 
definition of the domestic industry d id not comport with the requirements of Article  6.2 of the DSU . 
If we reverse the Panel's findings under Article  6.2, and find that Japan's claim concerning the 
definition of  the domestic industry is within the Panel's terms of reference, we will proceed to 
examine whether we can complete the legal analysis with respect to Japan's claim that the Korean 
investigating authorities acted inconsistently with Articles 3.1 and 4.1 of the  Anti-Dumping 
Agreement . 
5.2.1   Whether the Panel erred in finding that Japan's claim 7 concerning the definition of 
the domestic industry was not within its terms of reference  
5.19.    Claim 7 in Japan's panel request states that Korea's measures imposing anti -dumping duties 
on pneumatic valves from Japan are inconsistent with Korea's obligations under:  
Articles  3.1 and  4.1 of the [Anti-Dumping]  Agreement because Korea  failed to make an 
objective  examination based on positive evidence in defining the domestic industry 
producing  the like product and consequently in making a determination of injury[.]  
5.20.   The Panel found that this claim consisted of a general reference to the language in Article 3.1 
of the Anti -Dumping Agreement , which was not sufficient to present the problem clearly. According 
to the Panel, merely paraphrasing the language in the first part of Article  3.1 does not explain how 
or why Japan considers the measures at issue to be inconsistent with the specific obligations in 
Articles  3.1 and 4.1 of the Anti -Dumping  Agreement with respect to the definition of the domestic 
industry.89 The Panel thus considered that the pan el request was not precise enough to serve the 
dual function of defining the basis for the Panel's  terms of reference under Article  7.1 of the DSU, 
and informing other WTO  Members, including the respondent, of the nature of the dispute.90 Rather, 
the Panel considered that Japan's claim was "essentially generic", since "nothing in the panel request 
link[ed] the claim to the particular circumstances of the investigation at issue."91 The Panel then 
found that its conclusion was confirmed when taking into account  the "broad and diverse scope of 
the allegations concerning the alleged inconsistency in the definition of the domestic industry" 
advanced in Japan's later submissions.92  
5.21.   On appeal, the participants raise a number of arguments regarding the Panel's articul ation 
and application of the legal standard under Article  6.2 of the DSU, generally, as well as certain 
                                                
89 Panel  Report, para.  7.64. 
90 Panel  Report, para.  7.65. 
91 Panel  Report, para.  7.64. 
92 Panel  Report, para.  7.66. 
 WT/DS504/AB/R  
 
- 23 - 
 
  specific arguments for each of the individual claims concerning the Panel's application of Article  6.2. 
In this regard, Japan alleges several errors in the Panel's application of Article  6.2 to all of the claims 
it found to be outside its terms of reference.93 First, Japan argues that the Panel failed to consider 
the nature of the obligation at issue in each case, and that, for claims involving Article  3.1 of the 
Anti-Dumping Agreement, the Panel focused inordinately on that part of Japan's panel request 
related to this provision.94 Regarding claim 7, in particular, Japan argues that the Panel never 
discussed the narrow and specific obligation under Article  4.1 of the Anti -Dumping Agreement  to 
define the domestic industry properly , and instead focused on Article  3.1 as a general obli gation .95  
5.22.   Second, Japan argues that the Panel failed to consider the nature of the measure, despite the 
fact that four of the claims expressly correspond to specific sections of the measure at issue.96 In 
particular, Japan argues that, because claim 7 refer red specifically to "defining the domestic 
industry"97, and the corresponding part of the measure at issue also references Article  4.1, Korea 
should have been able to fully understand this claim.98 Third, Japan argues that the Panel improperly 
relied on the phrase "how or why" used by the Appellate  Body in certain disputes to create "its own 
arbitrary standard"99 requiring a complainant "to show not only a 'claim' , but also the 'argument' in 
support of that claim".100 Finally, Japan argues that the Panel imprope rly relied on later arguments, 
contrary to the Appellate  Body's findings that , "[c]ompliance with the requirement of Article  6.2 
must be determined on the face of the panel request, and a panel request should be evaluated based 
on what existed at that time ."101 
5.23.   As a preliminary matter, Korea submits that Japan's claims are essentially concerned with the 
Panel's alleged lack of reasoned and adequate explanation, its alleged failure to consider certain 
facts, and the allegedly "unfair" nature of the Panel's app roach, which Japan should have brought 
under Article  11 of the DSU.102 Turning to the specific errors alleged by Japan, Korea begins by 
noting that, given the multifaceted nature of the obligations referenced in Japan's claims, the Panel 
did not err in consi dering that Japan's panel request failed to summarize the "how or why" of the 
violation.103 Korea adds that the Panel did not ignore the fact that Japan's claim 7 was made pursuant 
to Articles  3.1 and 4.1 in combination, but found that the "generic" referenc e to Articles  3.1 and 4.1 
was insufficient to present the problem clearly.104 
5.24.   Furthermore, Korea argues that the Panel did not fail to consider the nature of the measure.105 
According to Korea, the frequent references in the investigating authorities' determin ations to the 
relevant legal obligations under the Anti -Dumping Agreement " [are] not a factor for determining the 
sufficiency of the claims made in a request for the establishment of a panel".106 Korea also argues 
that, contrary to Japan's argument, the Pane l indicated that a complainant is not required to present 
a summary of the arguments  in the panel request . Korea asserts , however, that Japan cannot meet 
the requirements of Article  6.2 of the DSU "by simply indicating the legal basis of the claim and 
paraphrasing the obligation".107 Korea further contends that, from a due process perspective, Japan's 
claim 7 concerning the definition of the domestic industry did not allow Korea to defend itself, 
especially in the context of a dispute involving a complex anti -dumping measure.108 Finally, Korea 
                                                
93 Japan's appellant's submission, para.  27. 
94 Japan's appellant's submission, paras.  28-29. See also ibid., par as. 30-37. 
95 Japan's appellant's submission, para.  79. 
96 Japan's appellant's submission, para.  40. See also ibid., paras.  38-39 and 82.  
97 Japan's appellant's submission, para.  82. 
98 Japan's appellant's submission, paras.  83-84. 
99 Japan's appellant's submis sion, para.  42. 
100 Japan's appellant's submission, para.  43. See also ibid., paras.  44-46 and 90.  
101 Japan's appellant's submission, para.  47 (referring to Panel  Report, para.  7.20; Appellate  Body 
Reports, US – Carbon Steel , para.  127; Australia – Apples , para.  418; US – Countervailing Measures (China) , 
para. 4.7; EC and certain member States – Large Civil Aircraft , para.  642; US – Gambling , para.  269). See also 
ibid., paras.  48-50 and 91 -92. 
102 Korea's appellee's submission, para.  6. See also ibid., paras . 67, 167, 229, 244, and 477.  
103 Korea's appellee's submission, para.  9. 
104 Korea's appellee's submission, para.  85. 
105 Korea's appellee's submission, para.  88. 
106 Korea's appellee's submission, para.  89 (referring to  Appellate  Body Report, Thailand  – H-Beams , 
paras.  94-95). 
107 Korea's appellee's submission, para.  10. 
108 Korea's appellee's submission, paras.  75-76. 
 WT/DS504/AB/R  
 
- 24 - 
 
  indicates that the Panel properly examined subsequent submissions to confirm its assessment of 
Japan's panel request.109 
5.25.   As we see it, the fact that part of Japan's claim may consist of paraphrasing the language of 
Article  3.1 of the Anti -Dumping Agreement is not, in and of itself, sufficient to establish that it does 
not comply with the requirements of Article  6.2 of the DS U. While we note the brevity of Japan's 
claim as listed in its panel request, we also observe that, beyond paraphrasing Article  3.1 of the 
Anti-Dumping Agreement, Japan also refers to Article  4.1 of the Anti -Dumping Agreement, such that 
it identifies both Articles  3.1 and 4.1 as the provisions of the covered agreements alleged to have 
been breached by Korea. As such, therefore, Japan's panel request fulfils the minimum requirement 
identified above, which is to identify the provisions of the covered agreemen ts alleged to have been 
breached. The Panel's task should thus have consisted in determining whether, in these 
circumstances, the panel request presents the problem clearly by plainly connecting the measure 
with these provisions, taking into consideration,  inter alia , the nature of the Korean measure, and 
the nature of the provisions  concerned.  
5.26.   Furthermore , Japan's claim under Articles  3.1 and 4.1 highlights that Japan is concerned with 
the manner in which the Korean investigating authorities " defin[ed] the domestic industry producing  
the like product ".110 Thus, the panel request, on its face, makes clear that Japan's claim relates 
specifically to the portion of the measure at issue that concerns the definition of  the domestic 
industry and its alleged inconsi stency with Korea's obligation under Articles  3.1 and 4.1, and not the 
anti-dumping measure "as a whole".111 
5.27.   Regarding the nature of the provisions  concerned, we recall that Article  4.1 of the 
Anti-Dumping Agreement defines the term "domestic industry" as either "the domestic producers as 
a whole of the like products" or "those [of them ] whose collective output of the products constitutes 
a major proportion of the total domestic production of those p roducts".112 In addition, in light of the 
requirement in Article  3.1 of the Anti -Dumping Agreement that the determination of injury "be based 
on positive evidence and involve an objective examination", "an investigating authority must not act 
so as to give r ise to a material risk of distortion in defining the domestic industry", in order "to 
ensure the accuracy of an injury determination".113 Thus, insofar as it relates to the definition of the 
domestic industry in general, the obligation established by Article s 3.1 and 4.1 is well  delineated. 
Together, Articles  3.1 and 4.1 establish a distinct obligation, such that Japan's identification of these 
provisions in the narrative of the panel request would seem to plainly connect the measure at issue 
with the provisi ons of the covered agreement alleged to have been breached, as required by  
Article  6.2 of the DSU.  
5.28.   Korea argues that Japan's claim "simply paraphrased the very general and essentially generic 
obligation under Article  3.1", and did not provide any narrativ e as to whether its claim related to 
specific aspects of Article  4.1, such as the selection of producers, the level of production represented 
by these producers  or these producers not being qualitatively representative of domestic production , 
or a combinat ion thereof.114 As a result, Korea maintains that it was not possible to know what claim 
it had to answer.115  
                                                
109 Korea's appellee's submission, paras.  11 and 97 -102. 
110 Emphasis added.  
111 See Korea's appellee's submission, para.  88. 
112 Appellate  Body Report, EC – Fasteners (China) (Article  21.5 – China) , para.  5.298 (referring to 
Appellate  Body Report, EC – Fasteners (China) , para.  411). We also recall that, by using the term "a major 
propo rtion", the second method "focuses on the question of how much production must be represented by 
those producers making up the domestic industry when the domestic industry is defined as less than the 
domestic producers as a whole". (Ibid. (quoting Appellat e Body Report, EC – Fasteners (China) , para.  411) 
(emphasis original)) The Appellate  Body has read the "major proportion" requirement as having both 
quantitative and qualitative aspects. (Ibid., para.  5.302) Article  4.1 also prescribes two specific ways fo r 
defining the domestic industry in the particular situations in which: (i) producers are related to exporters  or 
importers or are themselves importers; or (ii) the territory of a Member is divided into two or more competitive 
markets in exceptional circum stances. (See Article  4.1(i) and (ii) of the Anti -Dumping Agreement)  
113 Appellate  Body Report, EC – Fasteners (China) (Article  21.5 – China) , para.  5.300 (quoting 
Appellate  Body Report, EC – Fasteners (China) , para.  414).  
114 Korea's appellee's submission, pa ra. 86. 
115 Korea's appellee's submission, para.  86. 
 WT/DS504/AB/R  
 
- 25 - 
 
  5.29.   As we understand  it, Korea's argument stands for the proposition that there are several ways 
in which an investigating authority can breach the oblig ation established by Articles  3.1 and 4.1, and 
that Japan's panel request does not specify in which of these ways the Korean investigating 
authorities allegedly  breached the obligation in question. However, the fact that " an investigating 
authority can act  inconsistently with [a provision] in different ways, does not … mean that [it] 
therefore contains multiple, distinct obligations".116 In our view, the different ways highlighted by 
Korea in which the obligation can be breached do not establish many different obligations, but are 
rather different alternatives by which the Korean investigating authorities might have failed to 
ensure that the domestic industry was defined consistently with Articles  3.1 and 4.1, in a manner 
that ensures that the accuracy of an injury determination is not undermined by introducing a material 
risk of distortion in this definition.  
5.30.   As noted above , the Panel re lied on Japan's later submissions in order to confirm its finding 
that Japan's claim concerning the definition of the domestic industry was not within its terms of 
reference. The Panel found the "allegations" under Articles  3.1 and 4.1 in these submissions  to be 
"broad and diverse" in comparison with the narrative of the panel request.117 In our view, however, 
similar to the different "aspects" of the obligation under Article  4.1 that Korea refers to, these 
"allegations" referenced by the Panel are also diffe rent ways in which the Korean investigating 
authorities may have breached the obligation under Articles  3.1 and 4.1. As we see it, the se 
allegations relate to the manner in which the Korean investigating authorities allegedly  failed to 
define the domestic industry  properly , namely, by including only two domestic producers 
representing slightly more than half of the total domestic production and consisting of the applicants 
only118, by failing to make efforts to collect information from other domestic producer s or other 
sources and to ensure that the domestic industry was representative of the total domestic 
production119, and by failing to consider evidence objectively and adequately reason the decision to 
exclude certain producers from the definition.120 In our v iew, in making these allegations, Japan 
elaborated on why it considered that the Korean investigating authorities failed to define the 
domestic industry consistently with the requirements under Articles  3.1 and 4.1, that is, to define 
the domestic industry  either as all of the domestic producers of the like product, or "a major 
proportion" thereof, and to avoid introducing a material risk of distortion to such definition.  
5.31.   Furthermore , the Appellate  Body has said that the term " legal basis of the complaint" in 
Article  6.2 of the DSU refer s to the claims  pertaining to a specific provision of a covered agreement, 
that is, an allegation that "the respondent party has violated, or nullified or impaired the benefits 
arising from, an identified provision of a parti cular agreement."121 As such, claims  are to be 
distinguished from arguments , which are statements put forth by a complaining party "to 
demonstrate that the responding party's measure does indeed infringe upon the identified treaty 
provision", and do not need  to be included in the panel request.122 This is because Article  6.2 requires 
only "a  brief summary of the legal basis of the complaint ".123 
5.32.   In our view  the elements that , in Korea's view,  Japan should have developed in its panel 
request, as well as Japan's later submissions on which the Panel relied to confirm its finding, are 
arguments rather than claims, particularly because they do not relate to different obligations, but 
rather serve t o explain the manner in which the Korean investigating authorities allegedly  breached 
the obligation contained in Articles  3.1 and 4.1 of the Anti -Dumping Agreement. Japan was not 
required to include in its panel request the level of detail asserted by Kor ea in order to provide a 
"brief summary of the legal basis of the complaint sufficient to present the problem clearly".  
5.33.   According to the Panel, the fact that Japan did not provide more detail in its panel request 
meant that its claim was "essentially gene ric" and " [did] not explain how or why Japan considers 
                                                
116 Appellate  Body Report,  US – Countervailing Measures (China) , para.  4.24. 
117 Panel  Report, para.  7.66. 
118 See Panel  Report, para.  7.66.a -b. 
119 See Panel  Report, para.  7.66.c -d. 
120 See Panel  Report, para.  7.66.e-f. 
121 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU ), para. 5.14 (quoting 
Appellate  Body Report, Korea – Dairy , para.  139).  
122 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU ), para. 5.14 (quoting 
Appellate  Body Report, Korea – Dairy , para.  139). See also Appellate  Body Report, US – Countervailing 
Measures (China) , para.  4.9. 
123 Emphasis added.  
 WT/DS504/AB/R  
 
- 26 - 
 
  that the Korean Investigating Authorities' definition of the domestic industry did not involve an 
objective examination or was not based on positive evidence".124 We consider that the Panel's 
reasoning was based on a misunderstanding of the significance of the term "how or why" that the 
Appellate  Body has used at times.125 The Panel appears to have considered this term to entail that 
a complainant would be required t o include in the narrative of its panel request a level of detail going 
beyond setting out the claim underlying the complaint. However, as stated above, by using the term 
"how or why" in certain cases, the Appellate  Body did not introduce a legal standard different from 
the one outlined in paragraphs 5.3 to 5.9 above.  
5.34.   In sum, Ja pan's  panel request refers to both Articles  3.1 and 4.1 of the Anti -Dumping 
Agreement  and thus identifies the provisions of the covered agreements alleged to have been 
breached. Japan's claim also makes clear that it relates specifically to the portion of the measure at 
issue concerning the definition of  the domestic industry and its alleged inconsistency with Korea's 
obligation under Articles  3.1 and 4.1. In turn, Articles  3.1 and 4.1 together establish a distinct, 
well-delineated obligation regarding the definition of the domestic industry. Thus, Japan's claim 7 
"provide[s] a brief summary of the legal basis of the complaint sufficient to present the problem 
clearly" within the meaning of Article  6.2 of the DSU.  
5.35.   For the foregoing  reasons, we find that the Panel erred in finding that claim 7 in Japan's panel 
request was not within its terms of reference. Consequently, we reverse  the Panel's finding , in 
paragraphs 7.67 and 8.1.a of the Panel  Report , and find that Japan's cl aim 7 is within the Panel's 
terms of reference.  
5.2.2   Whether the Appellate  Body  can complete the legal analysis  
5.2.2.1   Introduction  
5.36.   Japan submits that, if the Appellate  Body reverses the Panel's finding that Japan's claim under 
Articles  3.1 and 4.1 of the Anti -Dumpin g Agreement  was not within its terms of reference, the 
Appellate  Body should complete the legal analysis and find that the Korean investigating authorities' 
definition of the domestic industry was inconsistent with these provisions. In Japan's view, "this 
claim rests on undisputed facts"126, in that the section entitled "Relevant facts" in the Panel  Report  
sets forth all the key facts needed to resolve this claim.127 On the basis of the facts set out in this 
section, Japan claims that the KTC acted incons istently with Articles  3.1 and 4.1 by defining the 
domestic industry as consisting of the two applicants, whose production the KTC found to constitute 
a major proportion of the total domestic production of the like products. Japan contends that the 
domesti c industry as defined by the KTC failed to meet the qualitative and quantitative elements of 
the "major proportion" requirement pursuant to Articles  3.1 and 4.1.128 
5.37.   Korea submits that the Panel did not explore the substantive issues and did not make any 
factual findings  with respect to Japan's claim under Articles  3.1 and 4.1 .129 According to Korea, the 
"Relevant facts" section of the Panel  Report  "describes some of the issues that were discussed in the 
course of the proceedings", but it contains neither factua l findings by the Panel nor an overview of 
the undisputed facts on the record.130 Korea further contends that the Panel 's summary of relevant 
facts is incomplete and, as such, do es not provide a sufficient basis for the Appellate  Body to 
                                                
124 Panel  Report, para.  7.64. (emphasis original)  
125 See para.  5.7 above.  
126 Japan's appellant's submission, para.  93. Japan also argues that this claim is "closely related to the 
Article  3 claims [that] the Panel did address", i.e. claims under Articles  3.1, 3.4, and 3.5 of the Anti -Dumping 
Agreement. (Ibid.) However, Japan does not explain how the claim under Articles  3.1 and 4.1 is "closely 
related" to its claims under Article  3 of the Anti -Dumping Agreement. Japan also does not identify facts or 
finding s pertaining to "the Article  3 claims that the Panel did address" in support of its Articles  3.1 and 4.1 
arguments, other than those contained in the "Relevant facts" section of the Panel  Report for the Articles  3.1 
and 4.1 claim.  
127 Japan's appellant's sub mission, para.  94 (referring to Panel  Report, paras.  7.46-7.55).  
128 Japan's appellant's submission, paras.  101-107. 
129 Korea's appellee's submission, paras.  19 and 106 -107. 
130 Korea's appellee's submission, para.  108. 
 WT/DS504/AB/R  
 
- 27 - 
 
  complete the legal analysis.131 In any event, Korea submits that the Korean investigating authorities 
defined the domestic industry consistently with Articles  3.1 and 4.1.132 
5.38.   The Appellate  Body has completed the legal analysis with a view to facilitating the prompt 
settlement an d effective resolution of the dispute only when the factual findings by the panel and/or 
undisputed facts on the panel record provide a sufficient factual basis for doing so.133 In this regard, 
the Appellate  Body has found that the plain text of an investiga ting authority's determinations in a 
trade remedy investigation could be relied on in completing the legal analysis.134 Moreover, the 
Appellate  Body has declined to complete the legal analysis in view of due process considerations135, 
for example, where the pa nel had not examined a claim at all136, or where there had not been a full 
exploration of the issues137 or scrutiny of the relevant evidence by the panel.138 With these 
considerations in mind, we turn to recall briefly the relevant legal standard under Articles  3.1 and 
4.1 of the Anti -Dumping Agreement and the relevant facts, before reviewing whether we could 
complete the legal analysis as requested by Japan.  
5.2.2.2   Relevant legal standards  
5.39.   The first sentence of Article  4.1 of the Anti -Dumping Agreement  provides for two methods of 
defining the domestic industry. It states:  
Article  4 
Definition of Domestic Industry  
4.1 For the purposes of this Agreement, the term "domestic industry " shall be 
interpreted as referring to the domestic producers as a whole of the like products or to 
those of them whose collective output of the products constitutes a major proportion  of 
the total domestic production of those products[.]139 
5.40.   Under the second method of defining the domestic industry, the "major  proportion  of the total 
domestic production " is determined by comparing the collective output of producers considered for 
inclusion with the production as a whole.140 The Appellate  Body has read the "major  proportion" 
                                                
131 Korea's appellee's submission, para.  109. 
132 Korea's appellee's submission, paras.  120 and 149.  
133 See e.g. Appellate  Body Reports, Australia – Salmon , paras.  117-119; US – Large Civil Aircraft 
(2nd complaint) , para.  1250; US – Lamb , para.  150; US – Shrimp , para.  124; US – Section 211 Appropriati ons 
Act, para.  343; EC and certain member States – Large Civil Aircraft , para.  1178; Colombia – Textiles , 
para. 5.30; US – Anti-Dumping Methodologies (China) , para.  5.146; Russia – Pigs (EU) , para.  5.141; EC and 
certain member States – Large Civil Aircraft  (Article  21.5 – US), para.  5.745; US – Continued Zeroing , 
para. 195. 
134 See e.g. Appellate  Body Report, US – Countervailing Measures (China) , para.  4.83. 
135 See e.g. Appellate  Body Reports, Russia – Commercial Vehicles , para.  5.141 (referring to 
Appellate  Body Reports, Canada – Renewable Energy / Canada – Feed-in Tariff Program , para.  5.224; 
EC ‒ Seal Products , paras.  5.63 and 5.69; US – Anti-Dumping Methodologies (China) , para.  5.146); 
EC – Export Subsidies on Sugar , para. 339; Peru – Agricultural Products , para.  5.157; Colombia – Textiles , 
para. 5.30; US – Countervailing Measures (China) , para.  4.82. 
136 See e.g. Appellate  Body Report, Russia – Pigs (EU) , para.  5.141 (referring to Appellate  Body Reports, 
EC – Poultry , para.  107; EC – Asbestos , paras.  79 and 82; US – Section 211 Appropriations Act , para.  343; 
EC – Export Subsidies on Sugar , para.  337).  
137 See e.g. Appellate  Body Reports, EC – Asbestos , para s. 81-82; EC ‒ Seal Products , para.  5.69; 
Russia  – Commercial Vehicles , para.  5.141; EC and certain member States – Large Civil Aircraft 
(Article  21.5 – US), para.  5.721.  
138 See e.g. Appellate  Body Report, US – Countervailing Measures (China) , para.  4.157.  
139 Emphasis added. Article  4.1 goes on to provide for two situations where producers of the like product 
may be excluded from the definition of the domestic industry, namely: (i) where producers are "related" to 
exporters or importers or are themselves impo rters of the allegedly dumped product; and (ii) where the 
territory of a Member is divided into two or more competitive markets and the producers within each market 
are regarded as a separate industry under specified conditions.  
140 Appellate  Body Report, EC – Fasteners (China) , para.  412. As indicated by the Appellate  Body, "the 
collective output of 'those' producers must be determined in relation to the production of the domestic 
producers as a whole." (Ibid.)  
 WT/DS504/AB/R  
 
- 28 - 
 
  requirement in Article  4.1 as having both quantitative and qualitative aspects.141 With regard to the 
quantitative  consideration, "a major proportion" should be properly understood as a relatively high 
proportion of the total domestic production , and will standardly serve as a substantial reflection of 
the total domestic production.142 The qualitative  consideration, in turn, is concerned with whether 
the domestic producers of the like product that are included in the definition of  the domestic indu stry 
are representative of the total domestic production.143 The quantitative and qualitative aspects of 
the definition of the domestic industry are closely connected in that " [t]he lower the proportion, the 
more sensitive an investigating authority will hav e to be to ensure that the proportion used 
sufficiently represents" the total domestic production.144 
5.41.   Furthermore, in light of Article  3.1, an investigating authority must not act so as to give rise 
to a material risk of distortion when defining the domestic  industry as a "major proportion" of the 
total domestic production pursuant to Article  4.1.145 Such a risk would arise, for example, where the 
investigating authorities define the domestic industry "on the basis of willingness to be included in 
the [injury] sample", thereby imposing a "self -selection process among the domestic producers".146 
A material risk of distortion could also arise if an investigating authority were permitted to leave out 
from the definition of  the domestic industry domestic producers of the like product that had provided 
data and sought to cooperate in the investigation on the basis of alleged deficiencies in the 
information provided without seeking to obtain additional information.147 The Appellate  Body has 
stated that "there is an inverse relationship between, on the one hand, the proportion of total 
production included in the domestic industry and, on the other hand, the existence of a material risk 
of distortion in the definition of domestic indus try and in the assessment of injury."148 This comports 
with the notion that the term "major proportion" has "both quantitative and qualitative 
connotations"149, and that t he process by which an investigating authority defines the domestic 
industry, including t he degree of efforts made by the investigating authority in obtaining information, 
is also relevant in assessing the qualitative aspect of the requirement.  
5.42.   Finally, in view of "[t]he practical constraint on an authority's ability to obtain information", 
especially in special market situations such as a fragmented industry, "what constitutes 'a major 
proportion of the total domestic production' may be lower than what is ordinarily permissible ."150 In 
such cases, however, "the investigating authority bears the same obligation to ensure that the 
process of defining the domestic industry does not give rise to a material risk of distortion" and 
                                                
141 Appellate  Body Reports, EC – Fasteners (China ) (Article  21.5 – China) , para.  5.302; 
Russia  – Commercial Vehicles , para.  5.12. 
142 Appellate  Body Report, EC – Fasteners (China) , para.  412. 
143 Appellate  Body Report, Russia – Commercial Vehicles , para.  5.13. 
144 Appellate  Body Report, Russia – Commercial Vehicles , para.  5.13. See also Appellate  Body Report, 
EC – Fasteners (China) , para.  412. 
145 Appellate  Body Report, EC – Fasteners (China) , para.  414. See also Appellate  Body Report, 
EC – Fasteners (China) (Article  21.5 – China) , para.  5.300.  
146 Appellate  Body Report, EC – Fasteners (China) , para.  427. In the subsequent compliance dispute 
pursuant to Article  21.5 of the DSU, the Appellate  Body found that the investigating authority relied on the 
same Notice of Initia tion that conditioned the producers' eligibility to be included in the domestic industry on 
their willingness to be included in the injury sample. The Appellate  Body found that the investigating authority 
failed to eliminate the material distortive effects  on the composition of the group of domestic producers that 
had come forward. (Appellate  Body Report, EC – Fasteners (China) (Article  21.5 – China) , para.  5.314)  
147 Appellate  Body Report, Russia – Commercial Vehicles , paras. 5.21 -5.22. In that dispute, the 
investigating authority defined the domestic industry as a single producer accounting for 87.9% of the total 
domestic production of the like product. (Ibid., para.  5.6) While there were two producers that cooperated with 
the investigation and provided data , the investigating authority decided not to include one of the two producers 
in the definition of the domestic industry after having reviewed that producer's data due to certain deficiencies 
in the data. (Ibid., para.  5.4) The Appellate  Body found that th e investigating authority acted inconsistently 
with Articles  3.1 and 4.1 of the Anti -Dumping Agreement, stating that the investigating authority "should seek 
to obtain additional information" from the domestic producer that provided allegedly deficient inf ormation, and 
that several provisions of the Anti -Dumping Agreement provide "tools … to address the inaccuracy and 
incompleteness of information". (Ibid., para.  5.22)  
148 Appellate  Body Report, Russia – Commercial Vehicles , para. 5.13. See also Appellate  Body Report, 
EC – Fasteners (China) (Article  21.5 – China) , para.  5.302.  
149 Appellate  Body Report, EC – Fasteners (China) (Article  21.5 – China) , para.  5.302.  
150 Appellate  Body Report, EC – Fasteners (China) , para.  415. 
 WT/DS504/AB/R  
 
- 29 - 
 
  "would need to make a greater effort to ensure that the selected domestic producers are 
representative of the total domest ic production".151 
5.2.2.3   Overview of relevant facts relating to the definition of the domestic industry  
5.43.   As a result of its finding that Japan's claim under Articles  3.1 and 4.1 was not within the 
Panel's terms of reference, the Panel did not examine the merits of  the claim.152 Nonetheless, the 
Panel  Report  contains a section entitled "Relevant facts", which describes the relevant aspects of the 
underlying anti -dumping investigation at issue relating to Japan's claim under Articles  3.1 and 4.1. 
In this section, the P anel quoted or summarized the relevant content of the documents on the Panel 
record.153 Neither participant disputes the  accuracy of the Panel's summary  contained in this section.  
5.44.   According to the "Relevant facts" section and the evidence on the Panel record  referenced 
therein , the OTI sent the questionnaires to all nine known producers of the like product, but only 
the two applicants, namely TPC Mechatronics Corporation (TPC) and KCC  Co., Ltd. (KCC) , submitted 
responses and reported their production volumes.154 Two of the remaining seven producers, Yonwoo 
Pneumatic ( Yonwoo ) and Shin Yeong Mechatronics ( Shin Yeong ), did not respond  to the 
questionnaire, referring to the lack of resources.155 Subsequently, i.e. after the public hearing with 
interested parties, these two producers submitted limited data, including their 2013 production 
volumes.156 As for the other five domestic producers, the Panel  Report  indicates that, b ecause the 
OTI "did not have any reliable source from which it could obtain acc urate production data of domestic 
producers of the pneumatic valves", it calculated the production volume based on the data provided 
by the applicants.157 Based on these data, the OTI found that the production volume of the two 
applicants constituted 55.4% o f the total domestic production of the like product.158 The OTI 
considered that the two applicants' combined production volume accounted for "a considerable 
portion of the total domestic production" and that, "[f]or the purpose of the investigation into the 
injury to the domestic industry [,] … the 'domestic industry' is defined as the 'total of TPC's and KCC's 
businesses producing a like product'."159 
5.45.   The OTI noted the Japanese respondents' argument that it should take into account all 
identified domestic produ cers of the like product for the purpose of the injury determination.160 The 
OTI considered that, "if it is impossible to obtain [relevant ] data on the entire domestic industry 
despite the relevant efforts of the investigation authorities , and if the compani es whose data are 
available account for a majority proportion of the domestic industry, it is appropriate and reasonable 
                                                
151 Appellate  Body Report, EC – Fasteners ( China) (Article  21.5 – China) , para.  5.303. See also 
Appellate  Body Report, EC – Fasteners (China) , para.  416. 
152 Panel  Report, para.  7.67. The Panel stated that it "will neither consider [Japan's claim under 
Articles  3.1 and 4.1] further nor resolve it". ( Ibid.)  
153 Panel  Report, paras.  7.46-7.55 and fns  82-109 thereto. These documents include: (i) the 
investigation application; (ii) OTI, Preliminary Report on Dumping and Injury to Domestic Industry of Valves 
for Pneumatic Transmissions imported from Japan, 2 6 June 2014 (OTI's Preliminary Report) (Panel Exhibit 
JPN-2b); OTI, Interim Investigation Report on Dumping and Injury to Domestic Industry of Valves for 
Pneumatic Transmissions from Japan, 23  October  2014 (OTI's Interim Report) (Panel Exhibit JPN -3b); and  
OTI's Final Report (Panel Exhibit KOR -2b (BCI)); (iii) KTC, Resolution of Preliminary Determination on Dumping 
and Injury to the Domestic Industry of Valves for Pneumatic Transmissions from Japan, 26  June 2014 (KTC's 
Preliminary Resolution) (Panel Exhibit  JPN-1b) and KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)); and 
(iv) Korea's responses to the Panel's questions. Most of the facts in the "Relevant facts" section correspond to 
the content of these underlying documents on the Panel record.  
154 Panel  Report, para.  7.49. 
155 Korea's first written submission to the Panel, para.  315. See also Panel  Report, para.  7.49 (referring 
to OTI's Final Report (Panel Exhibit KOR -2b (BCI)), p.  22 and fn  32 thereto); Korea's appellee's submission, 
para. 115. We note that the names of Yonwoo and Shin Yeong were redacted in the underlying documents 
(e.g. KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)) and OTI's Final Report (Panel Exhibit KOR -2b (BCI))). 
However, Korea unredacted the names of these companies in its submi ssions. (See Korea's first written 
submission to the Panel, para.  315) During the oral hearing, Korea confirmed that the names of Yonwoo and 
Shin Yeong are not to be treated as BCI.   
156 Korea's appellee's submission, paras.  118 and 139 -140; response to Panel question No. 102, 
paras.  83 and  85. See also Panel  Report, para.  7.49; OTI's Final Report (Panel Exhibit KOR -2b (BCI)), pp.  19, 
71, and  112. 
157 Panel  Report, para.  7.49 (quoting Korea 's response to Panel question No. 102, paras.  78 and 81).  
158 Panel  Report, para.  7.49. See also  OTI's Final Report (Panel Exhibit KOR -2b (BCI)), p.  19. 
159 Panel  Report, para.  7.49 (quoting OTI's Final Report (Panel Exhibit KOR -2b (BCI)), pp.  22-23). 
160 Panel  Report, para.  7.50. 
 WT/DS504/AB/R  
 
- 30 - 
 
  to analyze the injury to the domestic industry only based on the data from such companies."161 The 
OTI added that, due to the fact that m ost domestic producers were small and m edium-sized 
companies  and the lack of associations, groups , or research institutions in connection with the 
pneumatic valve industry, it would be "impossible to obtain reliable materials on the business 
conditions of the overall domestic industry".162 
5.46.   In addition, the OTI indicated that it conducted "an additional i nvestigation" into the two 
domestic producers that submitted limited production and profitability data, Yonwoo and Shin Yeong, 
in light of the Japanese respondents' argument that these two producers were not suffering from 
injury.163 The OTI found that both producers "showed changes in indicators similar to those of the 
applicants during the [period of investigation ( POI)]".164 The OTI further found that, although the 
operating profit ratio of these two  companies "was relatively good compared to that of the 
applicants", this was due mainly to their smaller selling, general, and administrative (SG&A) 
expenses.165 
5.47.   On the basis of the OTI's findings, the KTC stated in its Final Resolution that the domestic 
industry was properly defined as the total of TPC and KCC's b usinesses producing the like product.166 
The KTC also noted that the OTI had "conducted an additional analysis by including some producers 
mentioned by the respondents among the domestic producers who did not participate in the 
investigation, to the extent t hat data related thereto were available".167 The KTC concluded that the 
OTI's findings in this respect showed that the inclusion of these companies "would not significantly 
change the overall trends of the injury indicators of the domestic industry".168 
5.2.2.4   Whethe r the Appellate  Body  can complete the legal analysis regarding Japan's 
claim that the Korean investigating authorities' definition  of the domestic industry is 
inconsistent with Articles  3.1 and 4.1 of the Anti -Dumping Agreement  
5.48.   The domestic industry at iss ue was defined as those producers whose production accounted 
for a "major proportion" of the total domestic production under Article  4.1 of the Anti -Dumping 
Agreement . As noted above, the Appellate  Body has read the "major proportion" requirement in 
Article  4.1 as having both quantitative and qualitative aspects, which are closely connected.  
5.49.   Regarding the quantitative aspect of the "major proportion" requirement, Japan alleges 
several defects in the KTC' s calculation of the proportion of the total domestic output attributable to 
the domestic producers that were included in the definition of the domestic industry (i.e. TPC and 
KCC, who are also the two applicants of the anti -dumping investigation). Japan a rgues that "the KTC 
did not consider the available evidence objectively" by accepting the production volumes provided 
by the applicants for the five producers that did not provide any information.169 Japan contends that 
"[t]he OTI did not even bother to conf irm the accuracy of this basic number" or to "confirm, update, 
or verify … this information with subsequently submitted information for the two partially cooperative 
firms, Yonwoo and Shin Yeong" .170 Korea disputes this and contends that "the numbers origina lly 
provided by the applicants for Yonwoo and Shin Yeong were surprisingly similar to the actual 
production volumes submitted later by Yonwoo and Shin Yeong themselves."171 Korea also contends 
that "[the] KTC confirmed with the applicants that they had estim ated the production volumes of 
the other five domestic producers taking into account the total output of pneumatic valves in the 
                                                
161 Panel  Report, para.  7.50 (quoting OTI's Final Report (Panel Exhibit KOR -2b (BCI)), p.  23). (emphasis 
added)  
162 Panel  Report, para.  7.51 (quoting OTI's Final Report (Panel Exhibit KOR -2b (BCI)), p.  24). 
163 Korea's response to Panel question no. 64; Panel  Report, para.  7.52 (quoting OTI's Final Report 
(Panel Exhibit KOR -2b (BCI)), p.  24; referring to OTI's Final Report (Panel Exhibit KOR -2b (BCI), pp.  70-71)). 
See also Korea's appellee's submission, para.  118. 
164 Panel  Report, para.  7.52 (referring to OTI's Final Report (Panel Exhibit KOR -2b (BCI)), pp.  70-71). 
165 Panel  Report, para.  7.52 (referring to OTI's Final Report (Panel Exhibit KOR -2b (BCI)), pp.  70-71). 
166 Panel  Report, para.  7.54 (referring to KTC's Fi nal Resolution (Panel Exhibit KOR -1b (BCI)), p.  13). 
167 Panel  Report, para.  7.54 (quoting KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)), p.  14; 
referring to KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)), p.  24). 
168 Panel  Report, para.  7.55 (quoti ng KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)), p.  24). 
169 Japan's appellant's submission, para.  106. 
170 Japan's appellant's submission, para.  106. (fns  omitted)  
171 Korea's appellee's submission, para.  140. 
 WT/DS504/AB/R  
 
- 31 - 
 
  Korean market, the size of production capacity of these five producers, and the overall market shares 
of the five producers gen erally known to the players in the Korean market."172 
5.50.   Although Japan and Korea raised similar arguments before the Panel173, the Panel did not 
explore these arguments, nor is there anything in the "Relevant facts" section that addresses these 
arguments. Moreov er, neither Japan nor Korea directed us to findings in the Panel  Report  or 
undisputed facts on the Panel record that would allow us to assess the objectivity and sufficiency of 
the evidentiary basis of the Korean investigating authorities' examinations as to whether they 
"confirmed" the applicants' estimations.  
5.51.   In addition, we note Japan's argument that the calculation of the applicants' proportion of the 
total domestic output (i.e. 55.4%) was undermined by the inconsistencies between the production 
volumes  submitted by Yonwoo and Shin Yeong before the investigation was initiated and their 
production volumes relied on by the OTI in its Final Report.174 In response, Korea explains that the 
production volumes of Yonwoo and Shin Yeong relied on by the OTI in the Final Report were from 
2013 and covered the "like products", whereas the production volumes provided by Yonwoo and 
Shin Yeong before the investigation was initiated were from 2012 and did not represent the 
"like products", because these data were provided before the scope of subject products was defined 
by the investigating authorities.175 We note that Yonwoo and Shin Yeong's production data are 
directly relevant to determining the proportion of the total domestic production of pneumatic valves 
attributable t o TPC and KCC (i.e. two applicants defined as the domestic industry in the 
investigation) , as they are part of the total domestic output with which TPC and KCC's production 
was compared and the proportion of 55.4% was calculated. While the same arguments were 
presented by Japan and Korea before the Panel176, the Panel did not explore  the issue , including  by, 
inter alia , scrutinizing and weighing the evidence before it.  
5.52.   Thus, in the absence of relevant factual findings, sufficient undisputed facts on the Panel  
record, and sufficient exploration of these issues by the Panel, we are unable to assess whether  the 
KTC considered the available evidence objectively in calculating the proportion of the total domestic 
production attributable to the applicants.  
5.53.   With resp ect to the qualitative aspect of the "major proportion" requirement, Japan argues 
that "the KTC provided no explanation at all … to show whether and how the two [applicants] could 
be considered to represent the total domestic production as a whole."177 As a result, Japan contends 
that there was a material risk of distortion in the KTC's definition of the domestic industry.178 
According to Japan, "the KTC should have included more domestic producers (regardless of whether 
they were willing to cooperate at that point of time) … so that the definition of the domestic industry 
would be sufficiently representative" or, if necessary , the KTC could have relied on "facts available" 
under Article  6.8 of the Anti -Dumping Agreement .179 In response, Korea contends that there was 
"nothing in the process" leading up to the definition of  the domestic industry at issue that "was 
skewed in favor of one of the parties or biased in any way".180 Rather, all domestic producers were 
invited to participate and received questionnaire s, but only the applicants returned responses .181 
5.54.   As indicated in  the "Relevant facts" section of the Panel  Report , although th e Korean 
investigating authorities contacted all known domestic producers of the like product, only the 
applicants submitted responses to the questionnaires. In this regard, the situation in the present 
case differs from the previous disputes in which an i nvestigating authority was found to have failed 
                                                
172 Korea's appellee's submission, para.  141. 
173 Korea's response to Panel question No. 102, paras.  80-81; Japan's comments on Korea's response to 
Panel question No. 102, paras.  76-78; second written submission to the Panel, para.  197. 
174 Japan's appellant's submission, para.  106 (referring to Japan's s econd written submission to the 
Panel, para.  198).  
175 Korea's appellee's submission, paras.  144-145 (referring to Korea's response to Panel question 
No. 102).  
176 See Japan's second written submission to the Panel, para.  198; Korea's response to Panel questio n 
No. 102, paras.  82-85. 
177 Japan's appellant's submission, para.  101. 
178 Japan's appellant's submission, paras.  102-103. 
179 Japan's appellant's submission, para.  103. (fn  omitted)  
180 Korea's appellee's submission, para.  119. See also ibid., para.  133. 
181 Panel  Report, para.  7.49; Korea's appellee's submission, para.  115. 
 WT/DS504/AB/R  
 
- 32 - 
 
  to avoid a material risk of distortion in its definition of the domestic industry. As noted above, in 
those disputes, the investigating authorities either imposed a self-selection process  whereby only 
those p roducers that chose to be included in the injury sample made up the domestic industry182, or 
they excluded  a cooperating producer  from the definition of the domestic industry due to alleged 
deficiencies in the submitted data.183 
5.55.   In addition, we recall that wha t constitutes a "major proportion" may be lower in light of the 
practical constraints of obtaining information.184 This is not to suggest, however, that difficulty in 
obtaining data is, by itself, sufficient to relieve the investigating authorities of their duty under 
Articles  3.1 and  4.1 of the Anti -Dumping Agreement . As noted above, investigating authorities have 
an obligation to ensure that the process of defining the domestic industry does not give rise to a 
material risk of distortion and to make a great er effort to ensure that the domestic producers 
included in the definition of  the domestic industry are indeed representative  of the total domestic 
production.185 Thus, although only the applicants initially responded to the questionnaires, this in 
itself di d not necessarily mean that the qualitative aspect of the  definition of the  domestic industry 
at issue comports with the requirements of Articles  3.1 and 4.1. Rather, completing the  legal analysis 
on Japan's claim under Articles  3.1 and 4.1 would require an assessment of whether the producers 
included in the domestic industry as defined by the KTC were indeed representative, and whether 
the Korean investigating authorities acted in a manner that gave rise to a material risk of dis tortion.  
5.56.   In this regard, we note Korea's assertions that the two applicants represented a "relatively 
high production volume", the two applicants were "genuinely representative of the total domestic 
production" based on certain features  of their operations , and "there was a low risk that they 
somehow would not sufficiently represent the domestic producers as a whole."186 Korea made the 
same argument before the Panel187, but the Panel did not explore this argument or include any 
statements in this regard in the "Relevant facts" section.188 While there are facts on the Panel record 
that may potentially be relevant in addressing Korea's argument189, in the absence of any exploration 
of the issue by the Panel, we consider that completing  the legal analysis would raise d ue process 
concerns.  
5.57.   In addition, we recall that the process by which an investigating authority defines the domestic 
industry, including the degree of efforts made by the investigating authority, is relevant in assessing 
whether there was a material risk of distortion in defining the domestic industry.190 In the present 
case, Japan and Korea dispute the characterization of the efforts made by the Korean investigating 
authorities. Specifically, Japan contends that the Korean investigating authorities were "pa ssive" in 
gathering information for purposes of defining the domestic industry.191 Korea contends that "it is 
highly disputed that the Korean investigating authorities were 'passive'."192 The same arguments 
                                                
182 Appellate  Body Report, EC – Fasteners (China) , para.  427. 
183 Appellate  Body Report, Russia – Commercial Vehicles , paras.  5.21-5.22. 
184 Appellate  Body Report, EC – Fasteners (China) , para.  415. 
185 Appellate  Body Reports, EC – Fasteners (China) (Article  21.5 – China) , para.  5.303; EC – Fasteners 
(China) , para.  416. 
186 Korea's appellee's submission, para.  132. Specifically, Korea argues that "it is clear that the two 
Korean producers that formed the domestic industry produced a wide range of the pneumatic valve models 
included in the product definition; they sold valves both individually and as a part of the pneumatic system; 
they sold pneumatic valves for equipment in a diverse range of major industr ies, and they sold in the domestic 
Korean market through the main distributing channels." According to Korea, the two producers that formed the 
domestic industry were "thus genuinely representative of the total domestic production". (Ibid. (fn  omitted))  
187 Korea's first written submission to the Panel, paras.  309-310. 
188 During the oral hearing, Japan acknowledged that Korea made the same argument before the Panel 
but that the Panel made no findings in the Panel  Report.  
189 The OTI's Final Report describes vari ous aspects of the two applicants' operations relied on by Korea, 
such as the number of models that the two applicants produce, their sales of pneumatic valves as part of the 
pneumatic system, their customer base, and their distribution channel. (OTI's Fin al Report (Panel Exhibit 
KOR-2b (BCI)), pp.  4, 9, 15, and 17)  
190 As discussed above in paragraph 5.41and footnote 147 thereto, the Appellate  Body in 
Russia  – Commercial Vehicles  faulted the investigating authorities for excluding a cooperating domestic 
producer on the basis of alleged deficiencies in its questionnaire response without seeking additional 
information. (Appellate  Body Report, Russia  – Commercial Vehicles , para.  5.22).  
191 Japan's appellant's submission, para.  95. 
192 Korea's appellee's submission, para.  110. 
 WT/DS504/AB/R  
 
- 33 - 
 
  were raised before the Panel193, but the Panel did not explore them or include in the "Relevant facts" 
section any statement regarding whether the Korean investigating authorities were "passive". 
Moreover, neither Japan nor Korea directed us to findings in the Panel  Report  or undisputed facts on 
the Panel reco rd that would allow us to complete the legal analysis on this issue.  
5.58.   Furthermore, Japan and Korea dispute the meaning and the relevance of the "additional 
analysis" conducted by the OTI for assessing whether the domestic industry defined as TPC and KCC 
is representative of the total domestic production. As noted above, following arguments by the 
Japanese respondents, the OTI examined the limited data provided by Yonwoo and Shin Yeong194, 
and found that, while "[t]he operating profit ratio of these two compani es was relatively good 
compared to that of the applicants", the changes in their indicators were "similar to those of the 
applicants during the POI".195 According to Korea, this additional analysis supports its view that there 
was no material risk of distort ion.196 Japan, on the other hand, argues that the OTI's analysis was 
not adequately reasoned and failed to resolve the material risk of distortion.197 Thus, Japan contends 
that the Korean investigating authorities "provided no explanation at all addressing the  qualitative 
aspects to show whether and how the two petitioning firms could be considered to represent the 
total domestic production as a whole".198 
5.59.   Although the OTI's "additional analysis" is described in the "Relevant facts" section of the 
Panel  Report , this section does not contain any evaluation by the Panel of such analysis in light of 
the arguments presented by Japan and Korea. In particular, Korea relies on the OTI's discussion of 
the similarity in the pattern  of certain performance indicators between the two applicants, on the 
one hand, and Yonwoo and Shin Yeong, on the other hand.199 Japan, in contrast, relies on the 
differences in the sales and profits between these two groups of companies in absolute  terms.200 
These arguments were raised before the Panel201, but the Panel did not assess the OTI's additional 
analysis in light of these arguments.  Japan's arguments raise the question whether the data 
concerning performance indicators of domestic producers are relevan t for assessing the qualitative 
aspect of the definition of the domestic industry under Articles  3.1 and 4.1. However, in the absence 
of the Panel's exploration of the OTI's additional analysis in light of the parties' arguments, we do 
not have a sufficien t factual basis to complete the legal analysis to determine whether, and to what 
extent, Yonwoo and Shin Yeong's economic indicators were relevant in assessing the 
representativeness of the producers included in the definition of the domestic industry (i.e . TPC 
and KCC).  
5.60.   In sum, in defining the domestic industry as a "major proportion" of the total domestic 
production, an investigating authority is required to assess both quantitative and qualitative 
aspects202, and ensure that it does not act in a manner tha t gives rise to a material risk of 
distortion.203 As discussed above, we are unable to complete the legal analysis with regard to the 
above aspects of the "major proportion" requirement. First, i n the absence of relevant factual 
findings by the Panel or undi sputed facts on the Panel record, we are unable to assess whether the 
KTC considered the available evidence objectively in calculating the proportion of the total domestic 
production accounted for by the applicants. In addition, we do not have sufficient f actual findings by 
the Panel or undisputed facts on the Panel record to assess whether the two applicants included in 
the definition of the domestic industry were sufficiently representative of the total domestic 
production, or whether the Korean investiga ting authorities' process of defining the domestic 
                                                
193 Korea's appellee's submission, para.  110 (referring to Korea's second written submission to the 
Panel, paras.  140-142).  
194 Korea's response to Panel question no. 64; Pa nel Report, para.  7.52 (referring to OTI's Final Report 
(Panel Exhibit KOR -2b (BCI)), pp.  24 and  70-71). See also Korea's appellee's submission, para.  118. 
195 Panel  Report, para.  7.52. 
196 Korea's appellee's submission, para.  133; response to questioning at t he oral hearing.  
197 Japan's appellant's submission, para.  102. 
198 Japan's appellant's submission, para.  101. 
199 Panel  Report, para.  7.52; OTI's Final Report (Panel Exhibit KOR -2b (BCI)), p.  71; Korea's response to 
questioning at the oral hearing.  
200 Japan's fi rst written submission to the Panel, para.  250; response to questioning at the oral hearing.  
201 Japan's first written submission to the Panel, paras.  249-252; Korea's comments on Japan's response 
to Panel question No. 111.  
202 Appellate  Body Reports, EC – Fasteners (China) (Article  21.5 – China) , para.  5.302; 
Russia  – Commercial Vehicles , para.  5.12. 
203 Appellate  Body Reports, EC – Fasteners (China) , para.  414; EC – Fasteners (China) 
(Article  21.5 – China) , para.  5.300; Russia – Commercial Vehicles , para.  5.14. 
 WT/DS504/AB/R  
 
- 34 - 
 
  industry introduced a material risk of distortion.  Consequently, we find ourselves  unable to complete 
the legal analysis regarding Japan's claim that  the Korean investigating authorities' definition of the  
domestic industry  is inconsistent with Articles  3.1 and 4.1 of the Anti-Dumping  Agreement.  
5.3  Determination of injury  
5.3.1   Introduction  
5.61.   Japan's  panel request sets out six claims challenging the Korean investigating authorities' 
injury determination under the provisions of Article  3 of the Anti -Dumping Agreement. The Panel 
found that Japan's panel request, as it relate s to several of these claims,  failed to meet the 
requirements of Article  6.2 of the DSU to "provide a brief summary of the legal basis of the complaint 
sufficient to present the problem clearly" . Consequently, the Panel found these claims to be outside 
its terms of reference. Specific ally, the Panel found that Japan's claims 1204 and 2205, concerning the 
Korean investigating authorities' analysis of the volume of the dumped imports and price effects of 
such imports , were not within its terms of reference. The Panel found that Japan's claim  3, insofar 
as it relates to the Korean investigating authorities' examination of  two of the  specific economic 
factors listed in Article  3.4, was within the Panel's terms of reference, but that the remaining part of 
this claim was not.206 Furthermore, the Pa nel found that Japan's claims 4207 and 6208, concerning the 
Korean investigating authorities' causation analysis, were within its terms of reference. Finally, the 
Panel found that Japan's claim 5  was within the Panel's terms of reference , insofar as it concerns 
the adequacy  of the Korean investigating authorities ' examination  regarding certain known factors, 
other than the dumped imports, which caused injury to the domestic industry .209  
5.62.   Having  reached the above findings under Article  6.2 o f the DSU, the Panel examined the 
substance of Japan's claims that it found to be within its terms of reference, namely those under 
Articles  3.1, 3.4, and 3.5 of the Anti -Dumping Agreement. On the basis of its analysis, the Panel 
found that the Korean inve stigating authorities did not act inconsistently with Articles  3.1 and 3.4 
with respect to their examination of the impact of dumped imports on the state of the domestic 
industry210, but acted inconsistently with Articles  3.1 and 3.5 in certain aspects of th eir causation 
determination.211  
5.63.   Japan and Korea each appeal different aspects of the Panel's findings under Article  6.2 of the 
DSU and the Panel's substantive findings under the provisions of the Article  3 of the 
Anti-Dumping  Agreement. In addition, Japan r equests the Appellate  Body to complete the legal 
analysis regarding the claims under Article  3 that the Panel excluded from its terms of reference, 
while Korea maintains that the Appellate  Body cannot complete the legal analysis.  
5.64.   In light of the claims and arguments raised on appeal, we begin by examining whether the 
Panel erred in its findings pursuant to Article  6.2 of the DSU regarding Japan's various claims under 
Article  3 of the Anti -Dumping Agreement. We will then review the Panel's substantive findings under 
Article  3. Finally, if we reverse the Panel's findings under Article  6.2 of the DSU concerning Japan's 
claims 1, 2, and/or part of claim 3, and find that these claims were within the Panel's terms of 
reference, we will assess whe ther we can complete the legal analysis with respect to these claims.  
                                                
204 Panel  Report, para.  7.94. 
205 Panel  Report, para.  7.131.  
206 Panel  Report, paras.  7.170 and 7.175.  
207 Panel  Report, para.  7.235.  
208 Panel  Report, para.  7.226.  
209 Panel  Report, paras.  7.241 and 7.243. However, the Panel found that the allegation that the KTC 
failed to consider some known factors at all is not within its terms of reference. In the Panel's view, nothing in 
the panel request hints that the KTC omitted to consider any known factors causing injury. This finding is not 
subject to appeal. (Ibid., paras.  7.242 -7.243)  
210 Panel  Report, para.  7.192.  
211 Panel  Report, paras.  7.272, 7.322 -7.323, and 7.349.  WT/DS504/AB/R  
 
- 35 - 
 
  5.3.2   Whether the Panel erred in its findings under Article  6.2 of the DSU  
5.3.2.1   Whether the Panel erred in finding that Japan's claim 1 concerning the volume of 
the dumped imports was not within it s terms of reference  
5.65.   Claim 1 in Japan's panel request states that Korea's measure imposing the anti -dumping 
duties on pneumatic valves from Japan (the measure at issue) is inconsistent with Korea's obligations 
under:  
Articles  3.1 and 3.2 of the [Anti-Dumpi ng] Agreement because Korea's analysis of a 
significant increase of the imports  under  investigation did not involve an objective 
examination based on positive evidence[.]  
5.66.   The Panel considered that Japan's panel request failed to meet the requirements of Article 6.2 
of the DSU because Japan's claim merely paraphrase d the language in the first part of Article  3.1 of 
the Anti -Dumping Agreement without any additional narrative description of the problems that Japan 
consider ed to constitute the alleged inconsist ency. To the Panel, therefore, this was insufficient to 
explain how or why  Japan consider ed Articles  3.1 and 3.2 to be breached, or to mark out the 
parameters of the case of alleged inconsistency with Article  3.2 that Japan advance d in this dispute. 
The Pa nel thus found that Japan's claim was "essentially generic", since nothing in the panel request 
linked the claim to the particular circumstances of the investigation at issue.212 The Panel then found 
that its conclusion was confirmed when taking into account the scope of the allegations concerning 
volume effects advanced in Japan's written submissions.213 
5.67.   On appeal, Japan argues that the Panel erred in finding that its claim under Articles  3.1 
and 3.2 concerning the volume of dumped imports was not within its terms of reference.214 Japan 
argues that its claim "expressly identifies Articles  3.1 and 3.2 as the specific provisions at issue for 
this claim"215, but that the Panel "never discu ssed the narrow and specific obligation under Article  3.2 
to analyse the significant increase of the imports, and instead focused on Article  3.1 as a general 
obligation".216 Japan also indicates that, with regard to the nature of the measure, the claim 
"expr essly refers to the Korean measures imposing anti -dumping duties on pneumatic valves from 
Japan, as set forth in the KTC's Final Resolution"217, and that the Korean investigating authorities 
should have been able to fully understand that it concerned the ana lysis of the significant increase 
in the volume of imports.218 In this regard, Japan indicates that the KTC's Final Resolution expressly 
cites Article  3.2 when discussing its obligation under the Anti -Dumping Agreement.219 Japan also 
reiterates that the Panel improperly relied on the phrase "how or why"220, and improperly relied on 
Japan's  arguments  in its written submissions .221 
5.68.   Korea contends that the Panel did not ignore the fact that Japan's claim was made pursuant 
to both Articles  3.1 and 3.2. Rather, the Pane l correctly concluded that Japan's panel request only 
paraphrased the language of Article  3.1, and did not include any description of what it considered to 
be the problems with the Korean investigating authorities' consideration of the volume of dumped 
imports under Article  3.2.222 Korea also argues that it is not the task of a panel to discuss the 
measures to discover references in the investigation record that could have hinted at the nature of 
the problem.223 Korea further maintains that the Panel did not us e the phrase "how or why" to 
supersede the Appellate  Body's repeated affirmation that parties need not present the arguments in 
                                                
212 Panel  Report, para.  7.91. 
213 Panel  Report, para.  7.93. 
214 Japan's appellant's submission, para.  111. 
215 Japan's appellant's submission, para.  113. 
216 Japan's appellant's submission, para.  114. (fn  omitted)  
217 Japan's appellant's submission, para.  118. 
218 Japan's appellant's submission, para.  119. 
219 Japan's appellant's submission, para.  119. 
220 Japan's appellant's submission, para.  124. 
221 Japan's appellant's submission, paras.  125-126. 
222 Korea's appellee's submission, para.  168. 
223 Korea's appellee's submission, para.  172. 
 WT/DS504/AB/R  
 
- 36 - 
 
  support of their claim in their panel request, and did not improperly rely on Japan's arguments made 
in written submissions.224 
5.69.   As noted in section 5.1.2 above, before applying the legal standard under Article  6.2 of the 
DSU to Japan's panel request, the Panel set out its understanding of the legal framework for injury 
determination under Article  3 of the Anti -Dumping Agreement so as  to provide the context for its 
examination under Article  6.2 of the DSU.225 In so doing, the Panel indicated that merely mentioning 
the first part of Article  3.1, or using the language of that provision in a panel request, will not in 
itself normally suffice to present a problem clearly with respect to an allegation of violation of the 
Anti-Dumping Agreement.226 Such understanding guided the Panel's subsequent application of t he 
legal standard under Article  6.2 of the DSU to Japan's panel request, including claim 1 listed therein. 
As discussed in paragraph 5.15 above, the fact that the nar rative of Japan's claims set out in its 
panel request paraphrases the language of Article  3.1, in and of itself, is not dispositive of whether 
the panel request complies with Article  6.2 of the DSU. In our view, the Panel focused too narrowly 
on the part o f the narrative of Japan's claim paraphrasing the language of Article  3.1. In doing so, 
the Panel failed to assess whether th e narrative, in its entirety and in light of the nature of the 
measure and the nature of the obligations established by Article  3.1 and Article  3.2 of the 
Anti-Dumping Agreement sufficed to meet the requirements of Article  6.2 of the DSU . Therefore, we 
consider that the Panel's overemphasis on the reference to Article  3.1 in Japan's panel request 
undermined its analysis under Article  6.2 of the DSU. In our view, whether Japan's paraphrasing of 
Article  3.1 of the Anti -Dumping Agreement , together with the remainder of the narrative contained 
in the panel request, complies with the requirements of Article  6.2 of the DSU  should be assessed  
by taking into consideration the relevant circumstances of the claim.227 
5.70.   We note that, beyond paraphrasing Article  3.1, Japan's claim also includes a reference to 
Article  3.2 and indicates that it relates to "Korea's analysis of a significant increase of the imports". 
As such, Japan's panel request fulfils the minimum requirement we have identified above, which is 
to identify the provisions of the covered agreements alleged  to have been breached. The Panel's 
task should thus have consisted in determining whether, in these circumstances, the panel request 
provides a summary of the legal basis sufficient to present the problem clearly, including by plainly 
connecting the measu re at issue with these provisions, taking into consideration, for instance, the 
nature of the Korean measure and the nature of the provisions  concerned.  
5.71.   With regard to the nature of the measure, claim 1 in Japan's panel request refers to " Korea's 
analysis of a significant increase of the imports  under  investigation". Japan's panel request thus 
makes it clear that this claim concerns the specific portion of the measure at issue relating to the 
Korean investigating authorities' consideration of the volume of the dumped imports and its alleged 
inconsistency with Articles  3.1 and 3.2 of the Anti -Dumping Agreement.  
5.72.   With regard to the nature of the provisions  at issue, we recall that Article  3 "contain[s] several 
paragraphs setting out an investigating authority' s obligations with regard to various aspects of an 
injury determination in anti -dumping … investigations".228 Article  3.2 governs an investigating 
authority's consideration regarding the volume of dumped imports and the effect of such imports on 
domestic pri ces. By clarifying in the narrative of its claim that Japan's concerns are addressed at 
"Korea's analysis of a significant increase of the imports  under  investigation", Japan has thereby 
specified which of the elements of Article  3.2 it invokes under its c laim, namely the consideration of 
volume, contained in the first sentence of Article  3.2.  
5.73.   The first sentence of Article  3.2 provides that, "[w]ith regard to the volume of the dumped 
imports, the investigating authorities shall consider whether there has b een a significant increase in 
dumped imports , either in absolute terms or relative to production or consumption in the importing 
Member."229 Furthermore, an investigating authority's consideration of the volume of dumped 
imports pursuant to Article  3.2 is al so subject to the overarching principles, under Article  3.1, that 
it be based on positive evidence and involve an objective examination.230 In our view, therefore, the 
                                                
224 Korea's appellee's submission, paras.  175-179. 
225 See para.  5.13 above.  
226 See para.  5.13 above. See also Panel  Report, para.  7.35. 
227 See paras.  5.5-5.6 above.  
228 Appellate  Body Report, China – GOES , para.  125. 
229 Emphasis added.  
230 Appellate  Body Report, China – GOES , para.  130. WT/DS504/AB/R  
 
- 37 - 
 
  obligation established by Article  3.1 and the first sentence of Article  3.2 is distinct an d well  
delineated, in that it requires investigating authorities to make an objective examination of whether 
there has been a significant increase in dumped imports on the basis of positive evidence. Thus, by 
referring to Articles  3.1 and 3.2 as the provis ions of the covered agreement alleged to have been 
breached by Korea, and by indicating specifically which of the elements in Article  3.2 it concerns, 
namely the consideration of the volume of dumped imports, Japan's claim, while brief, plainly 
connects th e challenged measure with the obligation in question.  
5.74.   Korea nonetheless argues that Japan's claim concerning the volume of the dumped imports 
should be found to be outside the Panel's terms of reference because, "[i]n addition to the indication 
of the leg al basis of the complaint, there was no narrative sufficient to present the problem 
clearly."231 As noted  in section 5.1.1 above, however, in order to plainly connect the challenged 
measure with the obligation alleged to have been breached, a complainant is required to include in 
its panel request only the legal basis of the complaint, that is, its claim.232 As indicated, the 
complainant is not required to include in the narrative of its claim details beyond the legal basis of 
the complaint, such as arguments in support of its claim. In addition, as we  have indicated in 
section  5.2.1 above, the fact that an investigating authori ty can act inconsistently with a provision 
in different ways does not mean that the provision therefore contains multiple, distinct obligations.233  
5.75.   In this regard, the Panel indicated that the scope of the allegations advanced in Japan's 
submissions concern ing the Korean investigating authorities' analysis of the volume of imports 
confirmed its conclusion that Japan's claim is not within its terms of reference. We recall that the 
Panel relied on the following allegations: (i) the KTC failed to find an increa se in the volume of the 
dumped imports that was "significant"; (ii) the KTC improperly assumed a competitive relationship 
between domestic like products and dumped imports; (iii) the KTC improperly considered the effect 
of dumped imports that were still in  inventory; and (iv) the KTC failed to consider that no domestic 
volume had been displaced by the dumped imports.234 
5.76.   We also recall that  the obligation established by Article  3.1 and  the first sentence of Article  3.2 
of the Anti -Dumping Agreement is distinct  and well  delineated, in that it requires investigating 
authorities to make an objective examination of whether there has been a significant increase in 
dumped imports on the basis of positive evidence. As we see it, Japan's later allegations, on which 
the Panel relied, all relate to the different ways in which the Korean investigating authorities failed 
to conduct the required examination  properly . Therefore, these allegations appear to us to be 
arguments setting out the reasons why Japan considers that Ko rea has breached the obligation 
established by Articles  3.1 and  3.2 concerning the volume of the dumped imports. Thus, by relying 
on these later allegations as a confirmation that Japan's claim was not sufficiently detailed to comport 
with the requirements  of Article  6.2 of the DSU , the Panel appears to have erroneously considered 
that Japan should have included arguments in support of its claim in the panel request.  
5.77.   We also indicated in section 5.2.1  above that the Panel's similar findings in the context of 
Japan's claim relating to the definition of the domestic industry had apparently been informed by 
the Panel's misunderstanding of the significance of the term "how or why".235 For the reasons 
outline d above, the Appellate  Body's reference to the term "how or why" in certain disputes did not 
suggest a legal standard different from that under Article  6.2 of the DSU, and did not suggest that 
complainants are required to include more detail beyond the leg al basis of their complaint in their 
panel requests.  
5.78.   In sum, Japan's  claim 1 identifies both Articles  3.1 and 3.2 of the Anti -Dumping Agreement  
as the provisions alleged to have been breached and indicates that it relates to "Korea's analysis of 
a signific ant increase of the imports under investigation". This claim thus identifies the provisions of 
the covered agreements alleged to have been breached . It further makes it clear that it concerns 
the specific portion of the measure at issue relating to the Kor ean investigating authorities' 
consideration of the volume of the dumped imports and its alleged inconsistency with Articles  3.1 
                                                
231 Korea's appellee's submission, para.  170. 
232 See para.  5.31 above.  
233 See para.  5.29 above. See also Appellate  Body Report,  US – Countervailing Mea sures (China) , 
para. 4.24. 
234 Panel  Report, para.  7.93 (referring to Japan's first written submission to the Panel, paras.  117, 128, 
132-136, and 139 -141; second written submission to the Panel, paras.  98-117).  
235 See para.  5.33 above.  WT/DS504/AB/R  
 
- 38 - 
 
  and 3.2 of the Anti -Dumping Agreement. With regard to volume, Article  3.1 and the first sentence 
of Article  3.2 together establ ish a distinct and well -delineated obligation that the investigating 
authorities make an objective examination of whether there has been a significant increase in 
dumped imports on the basis of positive evidence. Thus, Japan's claim 1 "provide[s] a brief s ummary 
of the legal basis of the complaint sufficient to present the problem clearly" within the meaning of 
Article  6.2 of the DSU.  
5.79.   For the foregoing reasons, we find that the Panel erred in finding that Japan's claim 1, 
concerning the volume of the dumped  imports, was not within its terms of reference. Consequently, 
we reverse  the Panel's finding , in paragraphs 7.94 and 8.1.b of the Panel  Report , and find that 
Japan's claim 1 is within the Panel's terms of reference.  
5.3.2.2   Whether the Panel erred in finding that Japan's claim 2 concerning the price 
effects of the dumped imports was not within its terms of reference  
5.80.   Claim 2 in Japan's panel request states that th e measure at issue is inconsistent with Korea's 
obligations under:  
Articles  3.1 and 3.2 of the [Anti-Dumping]  Agreement because Korea's analysis of the 
effect of the imports under investigation on prices in the domestic market for like 
products did not inv olve an objective examination based on positive evidence; and 
because Korea failed to properly consider whether the effect of the imports under 
investigation was to depress prices to a significant degree or prevent price increase, 
which otherwise would hav e occurred, to a significant degree[.]  
5.81.   The Panel considered that Japan's panel request concerning the Korean investigating 
authorities' price-effect s analysis contains two elements, namely: (i) Korea's analysis of the effect 
of the imports under investigat ion on prices in the domestic market for like products did not involve 
an objective examination based on positive evidence; and (ii) Korea failed to properly  consider 
whether the effect of the imports under investigation was to depress prices to a signific ant degree 
or prevent price increases, which otherwise would have occurred, to a significant degree.236 
5.82.   With regard to the first element, the Panel indicated that the claim paraphrases the language 
in the first part of Article  3.1 of the Anti -Dumping Agreement  and recalled its earlier view that " a 
general reference to the language in Article  3.1 in itself  is not normally sufficient to present the 
problem clearly."237 To the Panel, this formulation d id not explain how or why Japan considers the 
measures at issue to be violating the specific WTO obligations in question, including that in 
Article  3.1.238 
5.83.   With regard to the second element, the Panel found that "the claim pa raphrases the language  
of the second sentence of Article  3.2 [of the Anti -Dumping Agreement ], with two notable 
differences ."239 First, Japan specifically refer red to two  of the three price effects mentioned in the 
second sentence of Article  3.2 (price suppre ssion and price depression) . Second, the use of the word 
"properly" indicate d that Japan t ook issue with the manner in which the KTC considered price 
suppression and price depression, which would include the extent of the alleged price suppression 
and price depression.240 However, the Panel found that Japan's panel request f ell short of explaining 
"how or why" it consider ed the KTC's consideration of price suppression and price depression to be 
"improper" and consequently inconsistent with Articles  3.1 and 3.2.241 This is because, to the Panel, 
the propriety of an investigating authority's consideratio n of complex economic issues is a broad 
concept , such that the true nature of the complaint cannot be presented clearly without some 
additional identification of the main elements of the alleged violation(s).242 
                                                
236 Panel  Report, para.  7.124.  
237 Panel  Report, para.  7.125. (fn  omitted)  
238 Panel  Report, para.  7.125.  
239 Panel Report, para.  7.126.  
240 Panel  Report, para.  7.126.  
241 Panel Repor t, para.  7.126.  
242 Panel Report, para.  7.126.  
 WT/DS504/AB/R  
 
- 39 - 
 
  5.84.   On appeal, Japan argues that the Panel erred i n finding that its claim under Articles  3.1 
and 3.2 of the Anti -Dumping Agreement concerning the price effects of the dumped imports was not 
within its terms of reference.243 Japan argues that its claim refers specifically to "Korea's failure 'to 
properly co nsider whether the effect … was to depress prices to a significant degree or prevent price 
increase … to a significant degree' , and expressly identifie [s] Articles  3.2 and 3.1 as the provisions 
at issue ."244 However,  according to Japan, the Panel failed to c onsider fully and carefully the "nature 
and scope" of this obligation, and failed to consider at all the claim in light of the nature of the 
specific measure being challenged.245 Japan further indicates that its claim refers specifically to the 
analysis of t he effect of the imports on prices, and that, in light of the nature of the measure at 
issue, the Korean investigating authorities should have been fully able to understand this claim.246 
Japan also reiterates that the Panel improperly relied on the phrase "how or why"247, and improperly 
relied on Japan's  arguments  in its written submissions .248  
5.85.    Korea maintains that a general reference to the language in Article  3.1, coupled with a generic 
reference to Article  3.2, is insufficient to present the problem clearly and does not inform Korea 
about how and why the Korean investigating authorities' analysis in question was supposedly 
inconsistent with these provisions.249 Korea indicates that Japan's claim paraphrases parts of 
Article  3.2, but does not state how or why the KTC's consideration was problematic in light of the 
different obligations in Article  3.2. Korea therefore argues that the Panel did not fail to consider the 
nature of the obligation,  and did not ignore the fact that Japan's claim was made pursuant to both 
Articles  3.1 and 3.2.250 With regard to the nature of the measure, Korea argues that Japan's panel 
request did not specifically provide a narrative that linked particular intermediate findings by the 
Korean investigating authorities to the legal provision s allegedly breached .251 Furthermore, Korea 
indicates that the Panel did not improperly rely on the term "how or why", but was rather aware of 
the distinction between claims and arguments .252 Finally, Korea submits that the Panel correctly took 
account of the scope of allegations as presented by Japan in its written submissions to confirm its 
determination that Japan 's panel request  failed to meet the requirements of Article  6.2 of the DSU.253 
5.86.   The Panel correctly noted that Japan's panel request identifies both Articles  3.1 and 3.2 of the 
Anti-Dumping Agreement as the provisions alleged to have been breached. The Panel then divided 
Japan's claim in to two different "elements" in order to assess its consistency with Article  6.2 of the 
DSU, namely one regarding the obligation under Article  3.1 of the Anti -Dumping Agreement , and 
the other regarding the obligation under Article  3.2. In assessing the consistency of the claim under 
Article  6.2 of the D SU with respect to the first of these "elements", the Panel relied once again on 
its earlier finding that merely paraphrasing Article  3.1 of the Anti -Dumping Agreement will not 
normally suffice to present the problem clearly.254 However, as indicated above255, whether Japan's 
paraphrasing of Article  3.1, together with the remainder of the narrative in the panel request, 
complies with the requirements of Article  6.2 should be assessed on a case -by-case basis, taking 
into account the specific  circumstances of each claim , including the nature of the measure and that 
of the obligation alleged to have been breached.  
5.87.   We note that, with regard to the nature of the measure, Japan's claim refers to "Korea's 
analysis of the effect of the imports unde r investigation on prices in the domestic market for like 
products" and "whether the effect of the imports under investigation was to depress prices to a 
significant degree or prevent price increase, which otherwise would have occurred, to a significant 
degree".256 Japan's panel request thus clearly indicates that this claim concerns the specific portion 
of the measure at issue that relates to the Korean investigating authorities' consideration of the 
                                                
243 Japan's appellant's submission, para.  156. 
244 Japan's appellant's submission, para.  158. 
245 Japan's appellant's submission, para.  159. 
246 Japan's appellant's submission, paras.  162 and 164.  
247 Japan's appellant's submission, para.  168. 
248 Japan's appellant's submission, paras.  169-170. 
249 Korea's appellee's submission, para.  230. 
250 Korea's appellee's submission, paras.  231-232 and 237.  
251 Korea's appellee's submission, para.  242. 
252 Korea's appellee's submission, para.  246. 
253 Korea's appellee's submission, para.  251. 
254 See Panel  Report, para.  7.125. See also paras.  5.13 and 5.20 above.  
255 See para.  5.15 above.  
256 Japan's panel request, claim 2.  
 WT/DS504/AB/R  
 
- 40 - 
 
  price effects of the dumped imports, more precisely signif icant price suppression and price 
depression, and its alleged inconsistency with Articles  3.1 and 3.2.  
5.88.   With regard to the nature of the provisions  at issue, the second sentence of Article  3.2 
requires an authority to " consider whether there has been a sign ificant price undercutting by the 
dumped imports as compared with the price of a like product of the importing Member, or whether 
the effect of such imports is otherwise to depress prices to a significant degree or prevent price 
increases, which otherwise would have occurred, to a significant degree ". Moreover, an investigating 
authority's consideration pursuant to Article  3.2 is also subject to the overarching principles, under 
Article  3.1, that it be based on positive evidence and involve an objective exa mination.257  
5.89.   Thus, similar to the obligation relating to the volume of dumped imports, the second sentence 
of Article  3.2, in conjunction with Article  3.1, sets out an obligation that is distinct and well  defined, 
with, at its core, the requirement to consi der, on the basis of an objective examination of positive 
evidence, whether the effect of the dumped imports on domestic prices consists of the economic 
phenomena contained therein . For the purpose of Japan's claim 2, such phenomena are significant 
price suppression and price depression . Therefore, by identifying the relevant portion of the measure 
concerned by this claim, listing Articles  3.1 and 3.2 of the Anti -Dumping Agreement as the provisions 
of the covered agreement alleged to have been breached by K orea, and indicating specifically which 
of the phenomena in Article  3.2 the claim concerns, Japan's claim, while brief, plainly connects the 
challenged measure with the obligation in question.  
5.90.   We note that the Panel considered certain aspects of the circum stances regarding claim 2 in 
its evaluation of the second "element" of Japan's claim. The Panel indicated that " [t]he propriety  of 
an investigating authority's consideration of complex economic issues is a broad concept ", and that 
"[t]he true nature of the complaint cannot be presented clearly without some additional identification 
of the main elements of the alleged violation (s)."258 The Panel also downplayed the relevance of the 
distinction between claims and arguments, noting that "in cases alleging vio lations of provision s 
governing complex economic issues such as those in the Anti -Dumping Agreement, in which … the 
measures at issue rest on a series of intermediate considerations involving such issues , … the 
boundary between a claim and an argument may not be entirely clear."259 
5.91.   In our view, all the steps of an investigating authority's analysis under Article  3 of the 
Anti-Dumping Agreement, leading to its overall determination of injury, are likely to entail a certain 
degree of complex economic analysis. At the same time, we recall that Article  6.2 of the DSU requires 
only "a brief summary of the legal basis of the complaint sufficient to present the problem clearly". 
We do not share the view that, beyond such a brief summary, a panel request must also spe ll out 
precisely which elements of the investigating authority's price-effects analysis are concerned by a 
claim of inconsistency with Article  3.2. We indicated in section 5.3.2.1  above, concerning Japan's 
claim 1, that it was sufficient for Japan to have identified the Korean investigating authorities' 
determination with respect to the volume of dumped imports as the specific portion of the measure 
concerned for the measure at issue to be plainly connected to the obligations alleged to have been 
breached. In our view, the same considerations are valid for Japan's claim 2. By indicating that 
"Korea failed to properly consider whether the effect of the imports under investigation was to 
depress prices to a significant degree or prevent price increase, which o therwise would have 
occurred, to a significant degree ", Japan has identified the Korean investigating authorities' 
consideration of significant price suppression and price depression as the specific portion of the 
measure concerned and  has plainly connecte d it with Articles  3.1 and 3.2.  
5.92.   We recall that the Panel relied on the scope of Japan's allegations in its subsequent written 
submissions to confirm its finding that claim 2 in Japan's panel request is not sufficient to present 
the problem clearly, and th erefore not within its terms of reference. However, we observe that these 
later allegations, on which the Panel relied, all relate to the different ways in which Japan considers 
that the obligation concerned might have been breached by Korea. More specific ally, these 
allegations relate to the Korean investigating authorities failure  to: (i) examine price comparability 
for purposes of examining the price effects260; (ii) consider the implications of the diverging price 
                                                
257 Appellate  Body Report, China – GOES , para.  130. 
258 Panel  Report, para.  7.126.  
259 Panel  Report, para.  7.128.  
260 See Panel  Report, para.  7.130.a.  
 WT/DS504/AB/R  
 
- 41 - 
 
  trends of the dumped imports and domestic  like products261; (iii) explain "the reasonable sales price" 
methodology used for assessing price suppression262; (iv) take into account certain facts and 
evidence including, in particular, the higher prices of the dumped imports263; (v) consider whether 
the pr ice suppression and price depression were "significant"264; and (vi) conduct a counterfactual 
analysis  of how the prices and volumes might have been different  in the absence of dumping .265  
5.93.   Therefore, i n our view, the different allegations relied on by the Panel elaborate on why Japan 
considers the Korean investigating authorities' price -effects analysis to be inconsistent with 
Articles  3.1 and  3.2 and, as such, are arguments in support of its claim unde r these provisions. As 
we indicated in section 5.1.1  above, the fact that an investigating authority can act inconsistently 
with a provision in different ways does not mean that it therefore contains multiple, distinct 
obligations, each of which must be sp ecified in a panel request.266 Indeed, in assessing Japan's 
claim  6 under Articles  3.1 and 3.5 of the Anti -Dumping Agreement, the Panel itself acknowledged 
that such allegations are "arguments [Japan] made in support of its claims under" Articles  3.1 and 
3.2.267 In our view, while the boundary between a claim and an argument need not be rigid268, it 
does not follow that a complainant should, in a panel request, elaborate on the reasons for which it 
believes the respondent has breached a provision of the covered a greements beyond what is 
required to provide the legal basis of the complaint sufficient to present the problem clearly.269 This 
is because  Article  6.2 demands only "a  brief summary" of the legal basis of the complaint and not 
the arguments in support of the  complaint .270 
5.94.   In sum, Japan's  claim  2 identifies both Articles  3.1 and 3.2 of the Anti -Dumping Agreement  
as the provisions alleged to have been breached. In addition,  Japan's panel request indicates that 
this claim concerns the specific portion of the measure at issue that relates to the Korean 
investigating authorities' consideration of the price effects of the dumped imports, more precisely 
significant price suppress ion and price depression , and its alleged inconsistency with Articles  3.1 and 
3.2. With regard to price effects, t he second sentence of Article  3.2, in conjunction with Article  3.1, 
sets out an obligation that is distinct and well  defined, with, at its cor e, the requirement to consider, 
on the basis of an objective examination of positive evidence, whether the effect of the dumped 
imports on domestic prices consists of the economic phenomena contained therein, including 
significant price suppression and pri ce depression . Therefore, Japan's claim 2 "provide[s] a brief 
summary of the legal basis of the complaint sufficient to present the problem clearly" within the 
meaning of Article  6.2 of the DSU.  
5.95.   For the foregoing reasons, we find that the Panel erred in fi nding that Japan's claim 2, 
concerning the price effects of the dumped imports, is not within its terms of reference. 
Consequently, we reverse  the Panel's finding , in paragraphs 7.131 and 8.1.c of the Panel  Report , 
and find that Japan's claim 2 is within t he Panel's terms of reference.  
5.3.2.3   Whether the Panel erred in finding that part of Japan's claim 3 concerning the 
impact of the dumped imports on the domestic industry was not within its terms of 
reference  
5.96.   Claim 3 in Japan's panel request states that the measure at issue is inconsistent with Korea's 
obligations under:  
Articles  3.1 and 3.4 of the [Anti-Dumping]  Agreement because Korea's analysis  of the 
impact of the imports under investigation on the domestic industry at issue  did not 
involve an objective e xamination  based on  positive evidence , including an evaluation of 
                                                
261 See Pa nel Report, para.  7.130.b.  
262 See Panel  Report, para.  7.130.c.  
263 See Panel  Report, para.  7.130.c and 7.130.d.  
264 See Panel  Report, para.  7.130.d.ii.  
265 See Panel  Report, para.  7.130.d.iii.  
266 See para.  5.29 above.  
267 Panel Report, para.  7.222. See also section 5.3.2.6 below.  
268 See Panel  Report, para.  7.128.  
269 See para.  5.31 above.  
270 Emphasis added.  
 WT/DS504/AB/R  
 
- 42 - 
 
  all relevant economic factors and indices having a bearing on the state of the domestic 
industry at issue [.] 
5.97.   The Panel noted that the first part of the above claim paraphrases the first part  of Article  3.1 
of the Anti -Dumping Agreement .271 Recalling that a general reference to the language in Article  3.1, 
in itself,  is not normally sufficient to present the problem clearly272, the Panel proceeded to determine 
whether the second part of the claim – the assertion of an alleged failure to conduct "an evaluation 
of all relevant economic factors and indices having a bearing on the state of the domestic industry 
at issue " – complied with the requirements of Article  6.2 of the DSU.273 
5.98.   Noting that Article  3.4 of the Anti -Dumping Agreement  sets forth a mandatory list of factors 
that must be evaluated in each case274, the Panel found that the panel request, on its face, suggest ed 
that the failure by the KTC to evaluate one or more of these f actors constitute d a violation of 
Articles  3.1 and 3.4. To the Panel, this formulation indicate d "how or why" Japan consider ed the 
measures at issue to be inconsistent with the specific WTO obligations in question, namely those in 
Articles  3.1 and 3.4 of t he Anti -Dumping Agreement.275 Furthermore, the Panel considered that the 
"allegations in Japan's [written] submissions that the KTC failed to evaluate two of the specific factors 
listed in Article  3.4 (the ability to raise capital or investments, and the mag nitude of the margin of 
dumping) may be viewed as arguments  seeking to demonstrate the claim  set out in the panel 
request".276 The Panel therefore found this part of claim 3 to be within its terms of reference.277 This 
finding is not challenged on appeal.  
5.99.   However, the Panel noted that, over the course of the proceedings, Japan advanced three 
other allegations of violations of Articles  3.1 and 3.4278, specifically that: (i) t he KTC did not establish 
a logical link between its findings on the volume and price effects under Article  3.2 and its finding of 
adverse impact under Article  3.4; (ii) with respect to certain factors listed in Article  3.4, the KTC 
failed to demonstrate any explanatory force of dumped  imports for unders tanding domestic -industry 
trends; and (iii) the KTC attached a high degree of importance to the relevant factors highlighting 
negative aspects, while disregarding or downplaying without any explanation the factors suggesting 
that the Korean industry was no t suffering injury .279 The Panel found that the panel request d id not 
indicate or suggest that Japan's claim regarding Korea's analysis  of the impact of the imports under 
investigation on the domestic industry  extends to include these allegations .280 The Panel  found, 
accordingly, that Japan's claim concerning the state of the domestic industry, under Articles  3.1 
and 3.4, was limited to the allegation that the KTC failed to evaluate two of the specific factors listed 
in Article  3.4, but did not include any othe r allegations .281 
5.100.   On appeal, Japan argues that the Panel erred in finding that part of its claim under 
Articles  3.1 and 3.4 was not within its terms of reference. Japan argues that, even though its claim 
expressly identified Articles  3.1 and 3.4 as the provisions at issue282, the Panel failed to consider 
fully and carefully the "nature and scope" of the obligation und er Article  3.4, and instead focused 
only on Article  3.1 as a general obligation.283  
5.101.   Japan also argues that the Panel fail ed to consider the nature of the measure, as its claim 
refers specifically to the "analysis of the impact of the imports"284, and the Kore an investigating 
authorities should have been able to fully understand this claim.285 Japan then argues that the Panel 
                                                
271 Panel  Report, para.  7.166.  
272 Panel  Report, para.  7.167.  
273 Panel  Report, para.  7.168.  
274 Panel  Report, para.  7.168 (referring to Panel  Reports, Thailand – H-Beams , para.  7.225; 
Argentina  – Poultry Anti -Dumping  Duties , para.  7.314).  
275 Panel  Report, para.  7.169. (emphasis original)  
276 Panel  Report, para.  7.170. (emphasis original)  
277 Panel Report, para.  7.175.  
278 Panel  Report, para.  7.172.  
279 Panel  Report, para.  7.172.  
280 Panel  Report, para.  7.173.  
281 Panel  Report, para.  7.175.  
282 Japan's appellant's submission, para.  210. 
283 Japan's appellant's submission, para.  211 (referring to Panel  Report, paras.  7.167 and 7.172 -7.173).  
284 Japan's appellant's submission, para.  214. See al so ibid., para.  215. 
285 Japan's appellant's submission, para.  218. 
 WT/DS504/AB/R  
 
- 43 - 
 
  improperly relied on the term "how or why".286 Finally, Japan reiterates that the Panel improperly 
relied on Japan's  arguments  in its written  submissions .287  
5.102.   Korea replies that Article  3.4 is a multifaceted provision that contains many separate yet 
interrelated obligations, and requires the complainant to be as precise and specific as possible in 
providing a brief summary of the legal basis of t he complaint in the panel request.288 To Korea, the 
Panel did not ignore the obligation in Article  3.4 to examine the impact of the dumped imports on 
the domestic industry.289 Rather, it is the lack of any specific description of the three allegations in 
quest ion that led the Panel to consider that the claim failed to explain "the requisite how or why" 
pursuant to Article  6.2 of the DSU.290 Korea also argues that the Panel did not err by failing to 
consider the nature of the measure.291 Korea further argue s that th e Panel did not improperly rely 
on the term "how or why", because it is evident from the Panel  Report  that the Panel was aware of 
the distinction between claims and arguments.292 Finally, Korea argues that the Panel correctly 
examined the panel request on it s face to find that the allegations concerning the lack of assessment 
of certain injury factors were covered by the language of the panel request, but that three specific 
additional claims were not.293  
5.103.   We indicated in section 5.1.1 above that, in assessing whether a panel request comports 
with the requirements of Article  6.2 of the DSU, a panel must examine a panel request on its face, 
taking into consideration the circumstances of each case. We also explained that, in order to provide 
a brief summary of the  legal basis of the complaint sufficient to present the problem clearly, the 
panel request must plainly connect the challenged measure with the obligation alleged to have been 
breached. In this regard, as we indicated, a complainant must, at a minimum, lis t the provisions of 
the covered agreement alleged to have been breached. However, there may be situations in which 
simply referring to these provisions falls short of meeting the legal standard under Article  6.2 of the 
DSU, for example, where the provision  at issue establishes multiple obligations.294  
5.104.   We observe that, in the present instance, Japan has identified Articles  3.1 and 3.4 of the 
Anti-Dumping Agreement as the provisions alleged to have been breached, such that it meets the 
minimum requirement iden tified above. However, whether the identification of these provisions will 
suffice will depend on the particular circumstances at issue. The Panel, as we recall, considered that 
three "allegations" raised by Japan under these provisions are outside its terms of reference. To the 
Panel, the language in the panel request "does not cover these three additional allegations", and "a 
general reference to the language in Article  3.1 in itself is not sufficient to present the problem  … 
clearly " with respect to these additional allegations.295 As we indicated in section 5.1.2 above, 
however, whether Japan's paraphrasing of Article  3.1, together with the remainder of the narrative 
contained in the panel request, complies with the requirements of Article 6.2 should be assessed on 
a case -by-case basis, depending on the relevant circumstances relating to each claim.   
5.105.   We note that Japan challenges under claim 3 only the portion of the measure at issue that 
relates to the Korean investigating authorities ' "analysis  of the impact of the imports under 
investigation on the domestic industry". Thus, similar to claims 1 and 2, Japan's present claim has 
identified the specific aspect of the measure at issue with sufficient precision.  
                                                
286 Japan's appellant's submission, paras.  222-223. To Japan, the Panel's mistaken belief that the use of 
this phrase by the Appellate  Body obliges the complainant to include arguments in its panel request also 
contributed to its incorrect conclusion that only the limited "allegation" concerning the two specific factors (the 
ability to raise capital or investments, and the magnitude of the margin of dumping) was properly within its 
terms of ref erence and that all other aspects of Japan's claim regarding Article  3.4 were outside its terms of 
reference. (Ibid.)  
287 Japan's appellant's submission, paras.  224-228. 
288 Korea's appellee's submission, para.  341. 
289 Korea's appellee's submission, para.  345. 
290 Korea's appellee's submission, para.  346. (emphasis original)  
291 Korea's appellee's submission, para.  351. See also ibid., para.  350. 
292 Korea's appellee's submission, para.  353. 
293 Korea's appellee's submission, para.  359. 
294 See para.  5.6 above.  
295 Panel  Report, para.  7.173.  
 WT/DS504/AB/R  
 
- 44 - 
 
  5.106.   Regarding the nature of th e provisions , Article  3.4 of the Anti -Dumping Agreement provides:  
The examination of the impact of the dumped imports on the domestic industry 
concerned shall include an evaluation of all relevant economic factors and indices having 
a bearing on the state of the industry, including actual and potential decline in sales, 
profits, output, market share, productivity, return on investments, or utilization of 
capacity; factors affecting domestic prices; the magnitude of the margin of dumping; 
actual and po tential negative effects on cash flow, inventories, employment, wages, 
growth, ability to raise capital or investments. This list is not exhaustive, nor can one 
or several of these factors necessarily give decisive guidance . 
5.107.   Article  3.4 thus requires an in vestigating authority to "derive an understanding of 
the impact  of subject imports", or, in other words, the relationship between the dumped imports 
and the state of the domestic industry.296 For purposes of this inquiry, Article  3.4 requires  the 
authorities  to evaluate "all relevant economic factors and indices having a bearing on the state of 
the industry". Article  3.4 "then lists certain factors that 'are deemed to be relevant in every 
investigation and which must always be evaluated by the  investigating authorities'".297 Moreover, 
the examination under Article  3.4 is subject to the "overarching principle" set out in Article  3.1 that 
the examination must be "objective" and be based on "positive evidence ".298 
5.108.   Thus, Article  3.4, together with Article 3.1, establishes a distinct obligation that essentially 
requires the investigating authorities to examine objectively the impact of the dumped imports on 
the domestic industry on the basis of positive evidence concerning all relevant economic factors a nd 
indices having a bearing on the state of the domestic industry. While there may be many factors 
informing this assessment, a complainant is not required to identify or otherwise refer to the different 
factors that it considers an investigating authority  would have failed to consider, or fail ed to consider  
properly. This is because, as indicated in section 5.2.1 above, in order to plainly connect the measure 
at issue with the provision alleged to have been breached, a complainant is required to provide only 
a brief summary of the legal basis of the complaint, that is, the claim and not arguments in support 
thereof.299 In this regard, we agree with the Panel that the "allegations in Japan's [written] 
submissions that the KTC failed to evaluate two of the spec ific factors listed in Article  3.4 (the ability 
to raise capital or investments , and the magnitude of the margin of dumping) may be viewed as 
arguments  seeking to demonstrate  the claim  set out in the panel request."300 
5.109.   We do not, however, understand the dist inction drawn by the Panel between the "arguments" 
pertaining to the above two factors listed in Article  3.4, on the one hand, and the other "allegations" 
advanced by Japan under Article  3.4 during the course of the panel proceedings, which the Panel 
excluded from its terms of reference, on the other hand.301 These allegations relate to the Korean 
investigating authorities' failure to link their findings on volume and price effects to their examination 
of the impact of the dumped imports, failure to demo nstrate the explanatory force of the dumped 
import for the state of the domestic industry, and disregard of economic factors suggesting a lack 
of injury.302 As we see it, the allegations that the Panel found not to be within its terms of reference 
describe t he reasons why Japan considers the Korean investigating authorities to have 
inappropriately considered the impact of the dumped imports  and/or the factors listed in Article  3.4, 
contrary to the requirements of objective examination and positive evidence un der Article  3.1. Thus, 
they serve to explain precisely the manner in which the Korean investigating authorities would have 
                                                
296 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.205 (quoting 
Appellate  Body Report, China – GOES , para.  149). (emphasis original)  
297 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.203 (quoting 
Appellate  Body Report, US – Hot-Rolled Steel , para.  194, in turn referring to Appellate  Body Report, 
Thailand  – H-Beams , fn 36 to para.  128).  
298 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.203 (referring to 
Appellate  Body Report, US – Hot-Rolled Steel , paras.  196-197).  
299 See para.  5.31 above.  
300 Panel  Report, para.  7.170. (emphasis original)  
301 See Panel  Report, paras.  7.169 -7.174. See also para.  5.99 above.  
302 See para.  5.99 above. See also Panel  Report, para.  7.172. In our view, the first two allegati ons 
concern the alleged failure to assess properly the relationship between the dumped imports and certain 
economic factors listed in Article  3.4 for purposes of understanding the impact of such imports, and the third 
allegation concerns the respective wei ght the authorities would have attributed to the factors they had 
examined.  WT/DS504/AB/R  
 
- 45 - 
 
  breached the single, distinct obligation established by Articles  3.1 and 3.4 of the Anti -Dumping 
Agreement.  
5.110.   In particular, we note th at the second of these allegations is that, with respect to certain 
factors listed in Article  3.4, the Korean investigating authorities failed to demonstrate any 
explanatory force of dumped  imports for understanding domestic -industry trends. We recall that  in 
China  – HP-SSST (Japan) / China  – HP-SSST (EU) , the Appellate  Body indicated:  
We do not see, in Japan's panel request, a claim under Articles  3.1 and  3.4 of the 
Anti-Dumping Agreement regarding [the Chinese investigating authorities']  alleged 
failure t o examine whether dumped imports provided "explanatory force" for the state 
of the domestic industry. The reference to "explanatory force" is drawn from the 
Appellate  Body's interpretation of Article  3.4 in its report in China – GOES . This 
reference formed  part of the Appellate  Body's reasoning in interpreting Article  3.4 in 
that dispute and should not be read to create an obligation that is distinct from that 
expressed in Article  3.4. Accordingly, we view Japan's submissions, insofar as they refer 
to "expl anatory force", as setting out arguments, based on the Appellate  Body's 
reasoning in China – GOES , in support of Japan's claims under Article  3.4. These claims 
were properly within the Panel's terms of reference .303 
5.111.   In sum, Japan's claim 3 identifies the portion of the measure at issue that relates to the 
Korean investigating authorities' "analysis  of the impact of the imports under investigation on the 
domestic industry" and thus identifies with sufficient precision the specific aspect of t he measure at 
issue. Claim 3 also identifies Articles  3.1 and 3.4 of the Anti -Dumping Agreement  as the provisions 
alleged to have been breached.  Article  3.4, together with Article  3.1, establishes a distinct obligation 
that essentially requires the investi gating authorities to examine objectively the impact of the 
dumped imports on the domestic industry on the basis of positive evidence concerning all relevant 
economic factors and  indices having a bearing on the state of the domestic industry. Japan's claim  3 
thus "provide[s] a brief summary of the legal basis of the complaint sufficient to present the problem 
clearly" within the meaning of Article  6.2 of the DSU. The three allegations that the Panel found to 
be outside its terms of reference, like Japan's o ther arguments under claim 3, serve to explain the 
manner in which the Korean investigating authorities would have breached the distinct obligation 
established by Articles  3.1 and 3.4, such that Japan was not required to include this level of detail 
in its panel request.  
5.112.   For the foregoing reasons, we find that the Panel erred in finding that these three allegations 
were not within its terms of reference. We therefore reverse  the Panel's finding, in paragraph 7.175 
of the Panel Report, that "all other allega tions of inconsistency with Article  3.4 argued by Japan are 
not properly within the Panel's terms of reference", and , in paragraph 8.1.d of the Panel  Report , that 
"Japan's claim under Articles  3.1 and 3.4 of the Anti -Dumping Agreement concerning the impact of 
the dumped import on the state of the domestic industry" was not within the Panel's terms of 
reference , and find the three allegations described above to be within the Panel's terms of 
reference .304 
5.3.2.4   Whether the Pane l erred in finding that Japan's claim 4 was within its terms of 
reference  
5.113.   Claim 4 in Japan's panel request states that the measure at issue is inconsistent with Korea's 
obligations under:  
Articles  3.1 and 3.5 of the [Anti-Dumping]  Agreement because Korea  failed to 
demonstrate that the imports under investigation were, through the effects of dumping, 
causing injury  to the domestic industry  based on an objective examination  of the alleged 
causal relationship between the imports under investigation and the all eged injury to 
                                                
303 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.191. (emphasis 
added; fn  omitted)  
304 The reversal does not concern the Panel's finding, also contained in the above -mentioned 
paragraphs, that Japan's allegations that the Korean investigating authorities failed to evaluate two of the 
specific factors listed in Article  3.4 (the ability to ra ise capital or investments, and the magnitude of the margin 
of dumping) comply with the requirements of Article  6.2 of the DSU and are within the Panel's terms of 
reference, given that this finding is not subject to appeal.  WT/DS504/AB/R  
 
- 46 - 
 
  the domestic industry , on the basis  of all relevant positive evidence before the 
authorities [.] 
5.114.   The Panel indicated that there are two aspects to Japan's claim, namely that: (i) Korea failed 
to conduct an objective examination  of the alleged  causal relationship on the basis  of all relevant 
positive evidence before the authorities; and (ii) Korea failed to demonstrate any causal relationship 
between the dumped imports and the injury  to the domestic industry. The Panel then indicated that, 
with regard to the first aspect, a general reference to the language of Article  3.1, in itself, is not 
normally sufficient to present the problem clearly. However, the Panel noted that Japan's claim is 
qualified by the second aspect, namely, its assertion that  Korea failed to demonstrate any causal 
relationship between the dumped imports and the injury  to the domestic industry on the basis of all 
of the evidence before the investigating authority.305 The Panel recalled that Article  3.5, and 
particularly its first  sentence, requires the demonstration that the dumped imports are causing injury 
to the domestic industry. In the Panel's view, "Japan's presentation of the problem in its panel 
request [was]  unequivocal" and, "despite its brevity, the panel request [made] it clear that Japan's 
claim focuse [d] on the alleged failure to demonstrate" causation.306 Thus, the Panel found Japan's 
formulation to meet the minimum requirement to connect the challenged measure with the 
obligation at issue, so that the respondent party  and other WTO Members were aware of the nature 
of the complaint.307 
5.115.   The Panel then considered that the allegations  raised in Japan's submissions regarding a 
lack of correlation in the trends of volumes, prices, and profits could be considered  to be arguments 
in support of its claim that the Korean investigating authorities failed to demonstrate any causal 
relationship between the dumped imports and  injury to the domestic industry.308 Accordingly, the 
Panel considered that Japan's claim that the KTC failed to demonstrate any causal relationship 
between the dumped imports and the injury  to the domestic industry, and thus acted inconsistently 
with Articles 3.1 and 3.5 of the Anti -Dumping Agreement, was within its terms of reference.309 
5.116.   On appeal, Korea argues that claim 4 simply paraphrases the legal obligation of Article  3.5 
without explaining how or why Japan considers this obligation to have been breache d by Korea310, 
and is therefore deficient in providing a summary sufficient to present the problem clearly.311 Korea 
argues that Article  3.5 is a multifaceted provision312, but that nothing in Japan's panel request allows 
Korea to know which of these legal oblig ations Japan's complaint is related to and "how and why" it 
considered Korea to have acted inconsistently with these legal obligations.313 To Korea, the Panel 
failed to examine the nature of the provision at issue or to explore the way in which the panel req uest 
on its face linked the specific findings of the Korean investigating authorities to one of the many 
aspects of the legal obligation of Article  3.5.314 
5.117.   Japan responds that its claim expressly identifie s Articles  3.1 and 3.5 of the Anti -Dumping 
Agreement as the specific provisions at issue, and also identifie s the obligation to make a 
determination about causation based on all relevant positive evidence regarding the "causal 
relationship".315 Therefore, Japan argues that the language used in claim 4 present s the problem 
clearly, in light of the nature and scope of the particular obligations.316 In response to Korea's 
argument that Article  3.5 is multifaceted, Japan indicates that this is precisely why Japan presented 
three distinct claims  under Article  3.5 in its panel request . Given that Japan's other two causation 
                                                
305 Panel  Report, paras.  7.232 -7.233. 
306 Panel  Report, para.  7.233.  
307 Panel  Report, para.  7.233.  
308 Panel  Report, para.  7.234.  
309 Panel  Report, para.  7.235.  
310 Korea's other appellant's submission, para.  60. 
311 Korea's other appellant's submission, para.  62. 
312 Korea indicates in this regard tha t the provision requires an investigating authority to: demonstrate 
that "dumped" imports caused injury; demonstrate that the dumped imports caused injury "through the effects 
of dumping"; demonstrate that a "causal" relationship exists between the dumped imports and the injury; 
examine "all … relevant" evidence that was properly "before the authorities"; also examine "any known factors 
other than the dumped imports"; and not "attribute" injuries caused by these other factors to the dumped 
imports. (Korea's  other appellant's submission, para.  64) 
313 Korea's other appellant's submission, para.  64. 
314 Korea's other appellant's submission, para.  64. 
315 Japan's appellee's submission, para.  28. 
316 Japan's appellee's submission, para.  29. 
 WT/DS504/AB/R  
 
- 47 - 
 
  claims (claim s 5 and 6) focus on different aspects of Article  3.5, Japan submits that it is hard to see 
how Korea could have been confused about the separate scope of Japan's claim 4 about "causal 
relationship".317 
5.118.   We indicated in section 5.1.1 above that in assessing whether a panel request comports with 
the requirements of Article  6.2 of the DSU, a panel must examine a panel request on its face, taking 
into consideration the circumstances of each cas e. We also indicated  that, in order to provide a brief 
summary of the legal basis of the complaint sufficient to present the problem clearly, the panel 
request must plainly connect the challenged measure with the obligation alleged to have been 
breached. I n this regard, a complainant must, at a minimum, list the provisions of the covered 
agreement alleged to have been breached, although there may be situations in which simply 
referring to these provisions falls short of meeting the legal standard under Article 6.2 of the DSU, 
for example , where the provision at issue establishes multiple obligations.318  
5.119.   With regard  to claim 4, although the Panel began by stating that "a general reference to the 
language of Article  3.1 in itself is not normally sufficient to p resent the problem clearly"319, the Panel 
did not end its analysis there. Rather, the Panel went on to analyse the relevant circumstances of 
this claim. The Panel observed that claim 4, on its face, contains two aspects, and that the first 
aspect – relating to the alleged failure to conduct an objective examination on the basis of positive 
evidence – is qualified by the second aspect, that is, the assertion that Korea failed to demonstrate 
any causal relationship.  The Panel then analysed the nature of the obl igation regarding the 
demonstration of the causal relationship established by  Article  3.5 and noted that Japan's panel 
request "unequivocal[ly]" presents the "problem" as one that relates to the failure to demonstrate 
this causal relationship.320  
5.120.   In our vie w, the Panel's analysis reflects its consideration of both the nature of the measure 
and that of the obligation at issue consistently with the applicable standard under Article  6.2 of the 
DSU. We observe that Japan's claim 4 relates specifically to the Kor ean investigating authorities' 
alleged failure "to demonstrate that the imports under investigation were … causing injury to the 
domestic industry". The relevant aspect of the measure at issue concerned by this claim thus relates 
to the demonstration of ca usation.  
5.121.   With regard to the nature of the provisions , Article  3.5 of the Anti -Dumping Agreement 
provides that:  
It must be demonstrated that the dumped imports are, through the effects of dumping, 
as set forth in paragraphs  2 and  4, causing injury within t he meaning of this Agreement. 
The demonstration of a causal relationship between the dumped imports and the injury 
to the domestic industry shall be based on an examination of all relevant evidence 
before the authorities. The authorities shall also examine  any known factors other than 
the dumped imports which at the same time are injuring the domestic industry, and the 
injuries caused by these other factors must not be attributed to the dumped imports. 
Factors which may be relevant in this respect include, inter alia, the volume and prices 
of imports not sold at dumping prices, contraction in demand or changes in the patterns 
of consumption, trade -restrictive practices of and competition between the foreign and 
domestic producers, developments in technology and the export performance and 
productivity of the domestic industry.  
5.122.   Thus, Article  3.5, together with Article  3.1, establish es obligations that are multilayered. 
First, it " must be demonstrated that the dumped imports are, through the effects of dumping, as set 
forth in paragraphs  2 and  4, causing injury within the meaning of this Agreement", a demonstration 
that "shall be based on an examination of all relevant evidence befo re the authorities". In addition, 
in situations where dumped imports and other known factors are causing injury to the domestic 
industry at the same time, the investigating authority must undertake the non -attribution analysis 
set out in Article  3.5. This non-attribution analysis may include the factors listed in the latter part of 
                                                
317 Japan's appellee's submissi on, para.  30. 
318 See para.  5.6 above.  
319 Panel  Report, para.  7.233.  
320 Panel  Report, para.  7.233.  
 WT/DS504/AB/R  
 
- 48 - 
 
  Article  3.5. For these reasons, we agree with Korea that that Articles  3.5 is a "multi -faceted 
provision".321 At the same time, we note that Japan agree s with this proposition.322  
5.123.   As Japan explains, it presents three claims under Articles  3.1 and 3.5, each with its distinct 
scope. Japan's claim 4, on its face, is about the alleged failure to demonstrate the causal relationship 
on the basis of an "objective examination" and "all relev ant … evidence before the authorities"323 as 
required under Article  3.5, in particular its second sentence, as well as under Article  3.1. As further 
discussed below324, claim 5 concerns the alleged inconsistency of the Korean investigating 
authorities' non -attribution analysis, and claim 6 concerns the alleged flaws in price effects, volume, 
and impact analysis that independently undermined the Korean investigating authorities' causation 
determination. Thus, we do not share Korea's view that "[n]othing in Japan 's panel request allows 
Korea to know which of these legal obligations [under Article  3.5] Japan's complaint is related to ."325 
5.124.   Our above analysis thus indicates that Japan has specified in the narrative of its claim which 
aspect of Articles  3.1 and 3.5 of t he Anti -Dumping Agreement the present claim concerns , together 
with the relevant aspect of the measure at issue. Japan's claim, while brief, has plainly connected 
the challenged measure with the provision alleged to have been breached such that Japan's cla im 4 
complies with the requirements of Article  6.2 of the DSU.  
5.125.   To the extent that Korea suggests that something more would have been required in the 
panel request to indicate "how or why" Japan argues that the Korean investigating authorities are 
alleged to have breached the requirement in Article  3.5326, we understand Korea to be requesting 
further elaboration explaining the alleged violation. However, as we indicated in section  5.2.1 above, 
in order to plainly connect the measure at issue with the provision alleged to have been breached, 
a complainant is required to provide only the legal basis, that is, the claim, underlying its complaint 
and not arguments in support of this claim.327 For these reasons, we agree with the Panel that the 
allegations  raised in Japan's submissions  – a lack of correlation in the trends of volumes, prices, and 
profits  – can be considered  arguments in support of its claim that the Korean investigating authorit ies 
failed to demonstrate any causal relationship between the dumped imports and injury to the 
domestic industry.328 
5.126.   In sum, Japan's claim 4 identifies Articles  3.1 and 3.5 of the Anti -Dumping Agreement  as 
the provisions alleged to have been breached, and re lates specifically to the Korean investigating 
authorities' alleged failure to demonstrate that the imports under investigation were causing injury 
to the domestic industry. While Article  3.5, together with Article  3.1, establishes obligations that are 
multilayered, Japan has indicated which aspect of the obligations set forth in Articles  3.1 and 3.5 is 
alleged to have been breached. Japan's claim 4, on its face, is about the alleged failure to 
demonstrate the causal relationship on the basis of an "objecti ve examination" of "all relevant … 
evidence before the authorities" as required under Article  3.5, in particular its second sentence, as 
well as under Article  3.1. Thus, Japan's claim 4 "provide[s] a brief summary of the legal basis of the 
complaint suffic ient to present the problem clearly" within the meaning of Article  6.2 of the DSU.  
5.127.   For the foregoing reasons, we find that the Panel did not err in finding that Japan's claim 4 
was within its terms of reference. Consequently, we uphold  the Panel's finding in paragraphs 7.235 
and 8.2.c of the Panel  Report . 
5.3.2.5   Whether the Panel erred in finding that part of Japan's claim 5 was within its 
terms of reference  
5.128.   Claim 5 in Japan's panel request states that the measure at issue is inconsistent with Korea's 
obligations under:  
                                                
321 Korea's other appellant's submission, para.  64. 
322 Japan's appellee's submission, para.  30. 
323 Japan's panel request, claim 4; Article  3.5 of the Anti -Dumping Agreement, second sentence.  
324 See sections 5.3.2.5 and 5.3.2.6 below.  
325 Korea's other appellant's submission, para.  64. 
326 Korea's other appellant's subm ission, para.  64. 
327 See para.  5.31 above.  
328 Panel  Report, para.  7.234.  
 WT/DS504/AB/R  
 
- 49 - 
 
  Articles  3.1 and 3.5 of the [Anti-Dumping]  Agreement because Korea failed to consider 
adequately all known factors other than the imports under investigation that were 
injuring the domestic industry at the same time and therefore incorrectly attributed 
injury caused by these other factors to the imports under investigation[.]  
5.129.   The P anel found that the panel request provide d a brief explanation of how or why Japan 
considers the measure at issue to be violating the specific WTO obligations in question, with respect 
to the alleged failure of the Korean investigating authorities to exami ne certain known factors  
adequately .329 In this context, the Panel considered that the allegations in Japan's submissions that 
the Korean investigating authorities considered three known factors other than the dumped imports 
that could be injuring the domest ic industry  in isolation, and yet failed to examine them adequately, 
may be seen as arguments seeking to demonstrate the claim set out in the panel request.330 Korea 
appeals these findings of the Panel.331  
5.130.   Korea submits  that, contrary to what the Panel found with respect to many of the other 
claims presented in Japan's panel request, the Panel effectively considered that, for claim 5, it 
suffices to paraphrase the obligation contained in the relevant provision s to meet the requirements 
of Article  6.2 of the DS U.332 In Korea's view, "[t]here was no narrative explanation of any kind in 
Japan's panel request that would allow Korea, third parties or the Panel … to understand the nature 
and scope of this claim ."333 Korea, therefore, argues that the Panel's findings reveal an error of law 
in the manner in which the Panel applied the requirements of Article  6.2 of the DSU to the facts of 
this case, as well as internal contradictions and inconsistencies that violate th e requirements of 
Article  11 of the DSU.334 
5.131.   Japan responds  that the language used in claim 5 presents the problem clearly in light of 
the nature and scope of the obligations at issue. Japan maintains that claim 5 draws on the specific 
language from the third  sentence of Article  3.5, and makes it clear that this claim concerns the 
inconsistency of the measure at issue with the obligation to "examine any known factors other than 
the dumped imports which at the same time are injuring the domestic industry" and t o ensure that 
such injury is not attributed to the  dumped  imports.335 In response to Korea's argument that there 
was no narrative explanation of any kind in Japan's panel request, Japan argues that each of its 
three causation claims addressed a particular el ement of Articles  3.1 and 3.5. As such, given that 
there are two other claims addressing causation, Japan argues that "it is hard to see why Korea was 
confused about the separate scope of Japan's claim 5 concerning other factors and 
non-attribution."336 
5.132.   Japan's claim 5, similar to its claim 4, concerns the determination of causation by the Korean 
investigating authorities within the meaning of Article  3.5 of the Anti -Dumping Agreement. Unlike 
claim 4, however, claim 5 relates to a specific aspect of the causa tion determination, namely the 
Korean investigating authorities' examination of the non -attribution factors. As we indicated in 
paragraph  5.122  above, Article  3.5, together with Article  3.1, establish es obligations that are 
multilayered. However, in the narrative of its claim, by challenging the failure "to consider 
adequately all known factors other than the imports", Japan has also identified precisely which aspect  
of the provisions its claim concerns, namely the requirement not to attribute to the dumped imports 
the injuries caused by any known factors other than the dumped imports. Thus, by identifying the 
specific aspects of both the measure at issue and the prov ision concerned, Japan's claim 5 plainly 
connects the challenged measure with the provisions of the covered agreements alleged to have 
been breached, thereby providing a brief summary of the legal basis of its complaint sufficient to 
present the problem cl early.  
                                                
329 Panel  Report, paras.  7.240 -7.241.  
330 Panel  Report, para.  7.241.  
331 The Panel found, however, that claim 5 "does not extend to cover the allegation that the KTC failed 
to consider some known factors at all" because, in the Panel's view, nothing in the panel request hints that the 
KTC failed to consider any known factors causing injury. (Panel  Report, para.  7.242 (emphasis original)) This 
finding is not subject  to appeal.  
332 Korea's other appellant's submission, paras.  34 and 68.  
333 Korea's other appellant's submission, para.  68. 
334 Korea's other appellant's submission, para.  35. See also section 5.3.2.7 below.  
335 Japan's appellee's submission, para.  37. 
336 Japan's appellee's submission, para.  39. 
 WT/DS504/AB/R  
 
- 50 - 
 
  5.133.   To the extent that Korea suggests that something more would have been required in the 
panel request to indicate how or why Japan alleges that the Korean investigating authorities 
breached the non -attribution requirement in Article  3.5, we understan d Korea to be requesting 
further elaboration on the reasons for the alleged violation. For example, Korea contends that 
Japan's claim, as described in the panel request, does not explain whether the claim "was  focused 
on an allegation/claim of not examinin g other factors at all; or, of not examining certain factors that 
were known in an adequate manner …; or, of a failure to conduct an adequate examination of the 
impact of the known factors".337 However, narrations of this kind appear to concern the different  
ways in which the Korean investigating authorities may have breached the obligation  and would 
have required Japan to substantiate its claim with arguments  in the panel request.  This, however , 
is not required under Article  6.2 of the DSU.338 For the same rea sons, we agree with the Panel that 
the allegations in Japan's written submissions, that the Korean investigating authorities considered 
three known factors other than the dumped imports that could be injuring the domestic industry  in 
isolation and failed t o examine them adequately, may be seen as arguments seeking to substantiate 
the claim set out in the panel request.339 
5.134.   Finally, we recall that the Panel found other allegations raised by Japan under claim 5 not to 
be within the scope of its terms of referenc e, namely that the Korean investigating authorities failed 
to consider some known factors at all.340 Given that neither participant has appealed this aspect of 
the Panel  Report , we do not address the Panel's findings concerning these allegations.  
5.135.   In sum, Japan's claim 5 identifies Articles  3.1 and 3.5 of the Anti -Dumping Agreement  as 
the provisions alleged to have been breached and relates to a specific aspect of the causation 
determination, namely the Korean investigating authorities' examination of the non -attribution 
factors. While Articles  3.1 and 3.5 establish obligations that are multilayered, Japan has identified 
which aspect of the provisions its claim concerns, namely t he requirement not to attribute to the 
dumped imports the injuries caused by any known factors other than the dumped imports. Thus, 
Japan's claim 5 "provide[s] a brief summary of the legal basis of its complaint sufficient to present 
the problem clearly" w ithin the meaning of Article  6.2 of the DSU.  
5.136.   For the foregoing reasons, we find that the Panel did not err in finding that part of Japan's 
claim 5 , with regard to Korea's alleged failure to consider adequately all known factors other than 
the dumped import s as causing injury,  was within its terms of reference. Consequently, we uphold  
the Panel's finding , in paragraphs  7.241 and 8.2.d of the Panel  Report , that Japan's claim under 
Articles  3.1 and 3.5 of the Anti -Dumping Agreement , insofar as it relates to  the alleged failure of the 
Korean investigating authorities to examine certain known factors adequately and their examination 
of those factors in isolation , is properly within the Panel's terms of reference.341  
5.3.2.6   Whether the Panel erred in finding that Japan's claim 6 was within its terms of 
reference  
5.137.   Claim 6 in Japan's panel request states that the measure at issue is inconsistent with Korea's 
obligations under:  
Articles  3.1 and 3.5 of the [Anti-Dumping]  Agreement because Korea's demonstration 
of causation lacks any foundation in its analyses of the volume of the imports under 
investigation, the effects of the imports under investigation on prices, and/or the impact 
of the imports under investigation on t he domestic industry at issue, irrespective and 
independent of whether Korea's flawed analysis of the volume and/or flawed analysis 
of the effects of the imports under investigation on prices, on the one hand, and Korea's 
flawed analysis of the impact of t he imports under investigation on the domestic 
                                                
337 Korea's other appellant's submission, para.  70. 
338 See para.  5.31 above.  
339 Panel  Report, para.  7.241.  
340 Panel  Report, para.  7.242.  
341 Our upholding of the Panel's above finding does not concern the Panel's finding, contained in 
paragraph  7.243, that "[a]ny other allegations in this regard are not within the Panel's terms of reference", 
given that such finding is not subject to appeal.  
 WT/DS504/AB/R  
 
- 51 - 
 
  industry on the other, would be inconsistent with, respectively, Articles  3.1 and 3.2 of 
the AD Agreement and Articles  3.1 and 3.4 of the AD Agreement[.]  
5.138.   The Panel noted that, "[o]n its face, Japan's panel req uest allege [d] that Korea's 
demonstration of causation lack [ed] any foundation in its analyses of volume of dumped imports, 
effects of imports on prices, and the impact of those imports on the domestic industry."342 The Panel 
recalled the requirement under Article 3.5 that an investigating authority demonstrate that the 
dumped imports are, through the effects of dumping as set forth in Articles  3.2 and 3.4, causing 
injury. Thus, the Panel considered:  
[T]he narrative in Japan's panel request, albeit brief, [was] sufficiently precise on its 
face to present the problem clearly, namely that, in Japan's view, the KTC's causation 
determination [was]  undermined by certain aspects of its volume, price effects, and 
impact analyses whether or not those aspects [were]  inconsistent with Article  3.1, 3.2, 
or 3.4 of the Anti -Dumping Agreement.343 
5.139.   The Panel then addressed Korea's argument that the term "irrespective and independent" in 
Japan's panel request ma de it unclear whether it set forth a new "claim" and , if so, what the  legal 
basis of this claim would be. The Panel indicated that this claim was independent in nature . The 
Panel explained that, if it  were to find that the Korean investigating authorities' consideration of 
volume and price effects and examination of impact were inconsistent with Articles  3.1, 3.2, 
and/or  3.4, such inconsistencies would support finding a consequential violation of Articles  3.1 
and 3.5, and there would be no need to go on to consider Japan's independent claim of inconsistency 
with Articles  3.1 and 3.5. However, if the Panel were to reject all of Japan's allegations of 
inconsistency under Articles  3.1, 3.2, and 3.4, in light of the term "irrespective and independen t", 
the Panel would need to go on to examine whether the KTC's determination of a causal relationship 
was inconsistent with Article  3.5 because of the alleged flaws in the KTC's analysis of volume, price 
effects, and impact in that determination .344 The Panel  noted that the nature of the independent 
claim in the latter decision scenario was "less evident", but that it could not preclude the possibility 
that an investigating authority's determination of causation may be inconsistent with Article  3.5 due 
to inad equacies in its analysis of the volume, price effects, or impact of dumped imports, even if 
these d id not demonstrate a violation of Articles  3.2 and/or  3.4.345 The Panel thus understood 
Japan's claim to "rest on the following premises":  
a. certain aspects of t he KTC's volume, price effects, and impact analyses were "flawed";  
b. these "flaws" were either unrelated to the obligations under Articles  3.1, 3.2, and  3.4, or 
did not, in themselves, constitute violations of Articles  3.1, 3.2, and 3.4; and  
c. these "flaws" ne vertheless have a sufficient impact on the KTC's causation determination 
to require the conclusion that the determination is inconsistent with Articles  3.1 and  3.5.346 
5.140.    The Panel then sought to confirm its above analysis by reviewing Japan's subsequent 
submi ssions. On the basis of its review, the Panel considered it "clear" that Japan h ad asserted "an 
independent claim that aspects of the KTC's consideration of the volume and price effects, and 
examination of the impact, of dumped imports preclude the finding  of a causal relationship 
consistently with Articles  3.1 and 3.5 of the Anti -Dumping Agreement".347  
5.141.   On appeal, Korea argues that Japan's claim is "unclear at even the most general level and 
was therefore clearly insufficient to present the problem clearly i n order to allow Korea to start 
preparing its defense".348 Korea contends that the Panel did not engage in any analysis, but made a 
conclusory finding349 and developed its own theory about what Japan's "independent claim" could 
                                                
342 Panel Report, para.  7.218.  
343 Panel  Report, para.  7.218.  
344 Panel  Report, para.  7.219.  
345 Panel  Report, para . 7.221.  
346 Panel  Report, para.  7.221.  
347 Panel  Report, para.  7.226.  
348 Korea's other appellant's submission, para.  74. 
349 Korea's other appellant's submission, paras.  24-25 (referring to Panel Report, para.  7.128).  
 WT/DS504/AB/R  
 
- 52 - 
 
  mean.350 Noting that the Panel fou nd Japan's claim to rest on a number of "premises", Korea submits 
that none of these premises are referenced in Japan's claim 6.351 In particular, the Panel considered 
Japan's panel request to allege certain "flaws" in the Korean investigating authorities' v olume, price 
effects, and impact analyses, and, not knowing from the panel request what they are, the Panel 
considered it necessary to "confirm" its understanding of the nature of Japan's claim by reviewing 
Japan's written submissions.352 However, the Panel found no new, separate, or additional arguments 
in the submissions other than the ones referring back to Japan's arguments relating to the claims 
under Articles  3.1, 3.2, and 3.4, which contradicts Japan's assertion of an "independent" claim.353 
Korea furthermore reiterates that there is no explanation of the "how or why" of this allegedly 
independent causation claim in the panel request, and Japan was effectively again paraphrasing the 
obligation in Article  3.5.354  
5.142.   Japan responds that claim 6 is properly within the Panel's terms of reference. Japan suggests 
that, as each of its causation claims refers to one specific obligation within Articles  3.1 and  3.5 of 
the Anti -Dumping Agreement, there is no ambiguity or misunderstanding, and each claim presents 
the problem clearly given the nature and scope of the obligations.355 To Japan, when compared with 
claims 4 and 5, it is clear that claim 6 focuses on a different obligation, that is, the ultimate conclusion 
of causation, and whether this conclusion had  a foundation in the underlying facts about volume, 
price effects, and impact on the domestic industry.356 Japan then argues that this claim "makes quite 
explicit that it is not just a consequential claim".357 Further, Japan indicates that its claim plainly 
connect s the measure at issue to the alleged inconsistency such that Korea should have been able 
to understand the claim  fully.358 Finally, Japan submits that the Panel's determination that the claim 
was within its terms of reference was based on the language of the panel request, and not on any 
subsequent submissions by Japan, and the fact that the Panel examined Japan's subsequent 
submissions does not mean that the problem was not presented in a sufficiently clear form in the 
panel request.359 
5.143.   Japan's claim 6, similar to its claims 4 and 5 discussed above, concerns a specific aspect of 
the Korean measure, namely the determination of causation by the Korean investigating authorities 
within the meaning of  Article  3.5 of the Anti -Dumping Agreement. At the same time , unlike claims  4 
and 5, the plain wording of claim 6 indicates that this claim concerns more specifically the alleged 
"lack[]" of "foundation" for the causation determination in the Korean investigating authorities' 
volume, price effects, and impact analy ses.  
5.144.   As indicated in paragraph  5.122  above, Articles  3.1 and 3.5 of the Anti -Dumping Agreement 
establish obligations that are multilayered. However, Japan has identi fied in the narrative of its claim 
the particular aspect of the provisions its claim relates to. By indicating that " Korea's demonstration 
of causation lacks any foundation in its analyses of the volume of the imports under investigation, 
the effects of th e imports under investigation on prices, and/or the impact of the imports under 
investigation on the domestic industry at issue", Japan's claim 6 relates to the demonstration of the 
causal relationship between the dumped imports and the domestic industry as provided in the first 
sentence of Article  3.5. The wording of claim 6 also indicates that this claim is brought "irrespective 
and independent of" whether s uch "flawed" volume, price effects, and impact analyses would be 
inconsistent with Articles  3.1, 3.2, and 3.4.  
5.145.   Thus, the reference to Articles  3.1 and 3.5, along with the narrative of claim 6 on its face, 
identifies with sufficient precision which part of Articles  3.1 and 3.5 Japan's claim 6 concerns, so as 
                                                
350 Korea's other appellant's submission, para . 25. 
351 Korea's other appellant's submission, para.  26 (quoting Panel  Report, para.  7.221). See also ibid., 
para. 78. 
352 Korea's other appellant's submission, para.  26. See also ibid., paras.  80-81. 
353 Korea's other appellant's submission, para.  27. See also  ibid., para.  82. 
354 Korea's other appellant's submission, para.  84. 
355 Japan's appellee's submission, para.  47. 
356 Japan's appellee's submission, para.  48. 
357 Japan's appellee's submission, para.  49. (emphasis original)  
358 Japan's appellee's submission, para.  52 (referring to OTI's Final Report (Panel Exhibit KOR -2b (BCI)), 
pp. 80-84). 
359 Japan's appellee's submission, para.  54. Japan indicates that Korea takes issue with the manner in 
which Japan presented arguments in support of its claim, but in doing so, Korea confuses the distinction 
between the "brief summary" of the claim and the ar guments in support of that claim. (Ibid., para.  55) 
 WT/DS504/AB/R  
 
- 53 - 
 
  to meet the minimum requirement under Article  6.2 of the DSU. We therefore share the Panel's view 
that "the narrative in Japan's panel request, albeit brief, is sufficiently precise on its face to presen t 
the problem clearly, namely that, in Japan's view, the KTC's  causation determination is undermined 
by certain aspects of its volume, price effects, and impact analyses whether or not those aspects 
are inconsistent with Article  3.1, 3.2, or 3.4 of the Ant i-Dumping Agreement."360 
5.146.   Korea argues that the Panel itself was uncertain as to the precise nature of Japan's claim 6 
and developed its own theory regarding the "premises" underlying Japan's claim.361 As we see it, 
however, in the findings referred to by Korea362, the Panel was responding to Korea's argument 
regarding the alleged ambiguity of the term "irrespective and independent" in Japan's panel request. 
Specifically, the Panel explained its understanding of this phrase and its implications for the 
resolution of the "independent" claim, in light of the possible outcome of the claims under Articles  3.2 
and 3.4 of the Anti -Dumping Agreement. According to the Panel, if the claims under Articles  3.2 
and 3.4 were to result in findings of inconsistency, there would b e no need to examine claim  6 
further , given that a consequential violation of Article  3.5 would flow from such findings of 
inconsistency. In contrast, if there were to be no findings of inconsistency under Articles  3.2 and  3.4, 
the Panel considered that it  would need to examine claim 6 precisely because, according to the panel 
request, this claim is raised regardless of whether an inconsistency with Articles  3.2 and 3.4 was 
found to exist and is, in that sense, "independent". It was in this context that the  Panel indicated 
that the nature of the independent claim may be "less evident" in comparison to a consequential 
claim, and explained what it regarded as the "premises" of Japan's claim.363 In other words, the 
"contingent" nature of claim 6 that the Panel re ferred to concerns the uncertainty as to how the 
claim would be resolved , rather than the uncertainty inherent in the text of the panel request.  
5.147.   In any event, we observe that these considerations are not essential for the assessment of 
the consistency of t he claim with the requirements of Article  6.2 of the DSU. Whether a claim is 
related to, contingent on, or independent from another claim does not detract from the requirement 
under Article  6.2 of the DSU to consider a panel request on its face to determin e whether it provides 
the legal basis of the complaint sufficient to present the problem clearly. In our view, the 
consideration of the interrelationship between claims is one that pertains more to the merits of these 
claims. In this regard, we recall that  the Appellate  Body indicated in Australia – Apples  that, "[f]or 
a matter to be within a panel's terms of reference —in the sense of Articles  6.2 and 7.1 of the DSU —
a complainant must identify 'the specific measures at issue' and the 'legal basis of the com plaint 
sufficient to present the problem clearly'"364, and that, by contrast, "the question of whether the 
measures identified in the panel request can violate , or cause the violation  of, the obligation … is a 
substantive issue to be addressed and resolved on the merits."365 
5.148.   Korea also maintains that, due to the use of the phrase "lacks any foundation" in Japan's 
claim 6, the only kinds of claims and arguments that can fall within the purview of Japan's claim 6 
are claims and arguments that the KTC's causation analysis was not based at all on its own volume, 
price effect, or impact analyses. Yet Japan has raised no such claims or arguments.366 We note, 
however, that, in order to reach this understanding of Japan's claim, Korea must read in isolation 
the phrase "lacks any foundation". As we indicated, the Panel properly assessed the narrative in 
Japan's claim 6 by considering it in its totality and by relying on the above -referenced "premises", 
such that a reading of this claim, as a whole, does not suppor t Korea's understanding.  
5.149.   Finally, Korea contends that the Panel erred by relying on Japan's subsequent submissions 
to confirm its above understanding regarding the nature of the independent claim367, and thus failed 
to adhere to the principles that the panel request must be examined on its face as it existed at the 
time of filing, and that any defects  in the panel request cannot be cured in subsequent submissions 
during the panel proceedings.368 We recall that, according to the Panel, the various arguments  raised 
                                                
360 Panel  Report, para.  7.218.  
361 Korea's other appellant's submission, paras.  77-78 (referring to Panel  Report, para.  7.221).  
362 See Panel  Report, paras.  7.219 -7.221.  
363 Panel  Report, para.  7.221.  
364 Appellate  Body Report,  Australia – Apples , para.  423. 
365 Appellate  Body Report,  Australia – Apples , para.  425. (emphasis original)  
366 Korea's other appellant's submission, para.  88. 
367 Korea's other appellant's submission, paras.  80-81. 
368 Korea's other appellant's submission, para.  81 (referring to Appellate  Body Report, US – Carbon 
Steel, para.  127). 
 WT/DS504/AB/R  
 
- 54 - 
 
  by Japan in support of claim 6 concern a number of "elements" in the Korean investigating 
authorities' volume, price -effects, and impact analys es that "disprove" the existence of a causal 
relationship.369 The Panel therefore considered it "clear" tha t Japan has asserted an independent 
claim under Articles  3.1 and 3.5.370 In our view, therefore, the Panel consulted Japan's subsequent 
submissions, not to "cure" an alleged defect in Japan's panel request, but merely to confirm its 
understanding of Japan's panel request on the basis of its text, in accordance with the requirements 
of Article  6.2 of the DSU.  
5.150.   In sum, Japan's claim 6 identifies Articles  3.1 and 3.5 of the Anti -Dumping Agreement  as 
the provisions alleged to have been breached, and concerns a sp ecific aspect of the Korean measure, 
namely the determination of causation by the Korean investigating authorities within the meaning 
of Article  3.5. While Articles  3.1 and 3.5 establish obligations that are multilayered, Japan  has 
identified in the narrat ive of its claim the particular aspect of the provisions its claim relates to. By 
indicating that " Korea's demonstration of causation lacks any foundation in its analyses of the volume 
of the imports under investigation, the effects of the imports under in vestigation on prices, and/or 
the impact of the imports under investigation on the domestic industry at issue", Japan's claim 6 
indicates that it takes issue with the demonstration of the causal relationship between the dumped 
imports and the domestic industry as provided in the first sentence of Article  3.5 of the Anti -Dumping 
Agreement . Thus, the Panel rightly took the vi ew that the narrative in Japan's panel request is 
sufficiently precise to present the problem clearly. In addition, whether a claim is related to, 
contingent on, or independent from another claim does not detract from the requirement under 
Article  6.2 of t he DSU to consider the panel request on its face to determine whether it provides the 
legal basis of the complaint sufficient to present the problem clearly.  
5.151.   For the foregoing reasons, we find that the Panel did not err in finding that Japan's claim 6 
was within its terms of reference. Consequently, we uphold  the Panel's finding in paragraphs  7.226 
and 8.2.b of the Panel  Report . 
5.3.2.7   Whether the Panel acted inconsistently with Article  11 of the DSU in assessing 
the consistency of Japan's panel request with Artic le 6.2 of the DSU   
5.152.   Korea claims on appeal that, in reaching its findings under Article  6.2 of the DSU regarding 
Japan's claims under Articles  3.1 and 3.5 of the Anti -Dumping Agreement, the Panel failed to conduct 
an "objective assessment of the matter" as required by Article  11 of the DSU. Korea argues that 
"[t]he Panel failed to provide an adequate and reasoned explanation supporting its finding that the 
paraphrasing of the obligations under Articles  3.1 and 3.5 of the Anti -Dumping Agreement sufficed 
to present the problem clearly, when that same paraphrasing was not considered to be sufficient in 
the context of most of the other claims included in Japan 's panel request."371 To Korea, "[t]he Panel's 
application of the standard [under] Article  6.2 of the DSU t o the facts in the context of the three 
causation claims [is] internally inconsistent and not supported by coherent reasoning"372, and 
reflects "an inappropriate desire on the part of the Panel to salvage at least some of Japan's 
claims".373 In contrast, Korea  argues that the Panel "correctly made the exact opposite findings in 
the context of all other claims it rejected under Article  6.2 DSU".374 
5.153.   Japan replies that the Panel's finding that the causation claims under Articles  3.1 and 3.5 of 
the Anti -Dumping Agreement were within its terms of reference is correct and does not reflect the 
lack of an objective assessment. To Japan, Korea's suggestion that the Panel was internally 
incoherent and inconsistent is "really just repackaging Korea's objection t o the merits of what the 
                                                
369 Panel  Report, paras.  7.223 -7.225.  
370 Panel  Report, para.  7.226.  
371 Korea's other appellant's submission, para.  261. 
372 Korea's other appellant's submission, para.  261. For instance, Korea notes that the Panel "noted the 
high degree of 'succinctness', ac knowledged that the problem was not presented clearly as it was required to 
seek 'confirmation' in the written submissions, expressed its own uncertainty about the meaning of the 
'independent' nature of the third causation claim and generally failed to pro vide any explanation of why 
paraphrasing the obligations under Articles  3.1 and 3.5 was sufficient to present the problem clearly" when it 
reached "the exact opposite conclusion with respect to, for example the claims under Articles  3.1 and 3.2 
or 6.9 of t he Anti -Dumping Agreement". (Ibid.)  
373 Korea's other appellant's submission, para.  262. 
374 Korea's other appellant's submission, para.  262. 
 WT/DS504/AB/R  
 
- 55 - 
 
  Panel found".375 Japan submits that "the mere fact that the Panel reached different conclusions on 
different issues does not establish a violation of Article  11 of the DSU."376 Moreover, "[e]ven if the 
Panel made one or more errors tha t reflected the Panel's misunderstanding of Article  6.2 of the DSU, 
those errors do not establish the lack of an objective assessment of the matter."377 Japan further 
argues that Korea's position is "rather extreme" since it "goes so far as to argue that non e of Japan's 
claims should have been found to be within the terms of reference".378 
5.154.   Article  11 of the DSU imposes on panels an obligation to "make an objective assessment of 
the matter before it, including an objective assessment of the facts of the case and  the applicability 
of and conformity with the relevant covered agreements". In certain disputes, panels have been 
found to breach their obligations under Article  11 of the DSU due to their internally inconsistent 
reliance on, or examination of, the evidenc e before them.379 Furthermore, the Appellate  Body 
indicated that a claim that a panel has acted inconsistently with its obligations under Article  11 of 
the DSU is a "serious allegation "380 that impugns a panel's assessment of its jurisdiction381, and that 
must s tand on its own rather than being made as a subsidiary argument in support of a claim that 
a panel erred in its application of a WTO provision.382 
5.155.   In the present dispute, the Panel found  that, with respect to Japan's claims under 
Articles  3.1, 3.2, 3.4, 4.1,  and 6.9 of the Anti -Dumping Agreement, by merely paraphrasing the 
provisions concerned, Japan's panel request was not sufficient to meet the requirements of 
Article  6.2 of the DSU. Korea takes issue with the fact that , when the Panel applied the same 
provision of the DSU to assess the sufficiency of Japan's panel request with respect to its claims 
under Articles  3.1 and 3.5, the Panel found that merely paraphrasing these provisions was sufficient 
to meet the requirements of Article  6.2. Korea therefore arg ues that the Panel's reasoning is 
internally incoherent and inconsistent.  
5.156.   Thus, Korea's challenge is not directed at the Panel's alleged inconsistency in the 
appreciation of evidence, but rather at its alleged inconsistency in applying the legal standard u nder 
Article  6.2 of the DSU to Japan's different claims in its panel request. In this context, therefore, the 
Appellate  Body's findings in past  disputes do not lend support to Korea's argument.383 This is 
because, in those disputes , the incoherence or incons istency that amounted to a violation of 
Article  11 of the DSU related to the manner in which the panel engaged with the evidence and facts 
before it, rather than how the panel interpreted or applied a legal provision.  
                                                
375 Japan's appellee's submission, para.  137. 
376 Japan's appellee's submission, para.  137. 
377 Japan's appellee's submissio n, para.  137. 
378 Japan's appellee's submission, para.  138 (referring to Korea's other appellant's submission, 
para. 262).  
379 For example, in US – Upland Cotton (Article  21.5 – Brazil) , the Appellate  Body found that the panel's 
"internally incoherent treatmen t of the same class of quantitative evidence … vitiates the conclusion it drew 
based on the financial data submitted by the parties". (Appellate  Body Report, US – Upland Cotton 
(Article  21.5 – Brazil) , para.  294) In EC and certain member States – Large Civ il Aircraft , the Appellate  Body 
found that the panel's analysis revealed certain inconsistencies because the panel relied on certain benchmarks 
that it had previously dismissed as unsuitable for assessing the existence of a "benefit" within the meaning of 
Article  1.1(b) of the SCM  Agreement. (Appellate  Body Report, EC and certain member States – Large Civil 
Aircraft , paras.  882-894) In Russia  – Commercial Vehicles , the Appellate  Body noted that, after finding that the 
methodology used by the investigating a uthority to examine price effects under Article  3.2 of the Anti -Dumping 
Agreement was flawed, the panel subsequently found that the same methodology was capable of supporting 
the investigating authority's finding of price suppression. (Appellate  Body Repor t, Russia – Commercial 
Vehicles , paras.  5.55-5.64 and  5.78-5.79) In the latter two disputes, the Appellate  Body found that the panel's 
internally inconsistent reasoning "cannot be reconciled with [its] duty to make an objective assessment" of the 
matter un der Article  11 of the DSU. (Appellate  Body Reports, EC and certain member States – Large Civil 
Aircraft , para.  894; Russia – Commercial Vehicles , para.  5.79)  
380 Appellate  Body Reports, China – Rare Earths , para.  5.227 (quoting Appellate  Body Report, 
EC – Poultry, para.  133).  
381 Appellate  Body Report, EC – Fasteners (China) (Article  21.5 – China) , para.  5.292 (referring to 
Appellate  Body Reports, US – 1916 Act , para.  54; Mexico – Corn Syrup (Article  21.5 – US), para.  36). 
382 Appellate  Body Reports, Chile – Price Band System (Article  21.5 – Argentina) , para.  238; US – Steel 
Safeguards , para.  498; US – Zeroing (EC) (Article  21.5 – EC), para.  401; EC – Fasteners (China) , para.  442; 
US – COOL , para.  301; China – Rare Earths , para.  5.173; Argentina – Import Measures , para.  5.173.  
383 See supra , fn 379. 
 WT/DS504/AB/R  
 
- 56 - 
 
  5.157.   As we have indicated above, the consi stency of a claim with the requirements of Article  6.2 
of the DSU is to be determined on the face of the panel request, on a case -by-case basis, taking 
into consideration the circumstances of each case. We have found above that the Panel erred in its 
application of this legal standard in finding that Japan's claims under Articles  3.1 and 3.2  of the 
Anti-Dumping Agreement , part of its claim under Articles  3.1 and 3.4  of that Agreement , and its 
claim under Articles  3.1 and 4.1  of that Agreement , respectively, were not within its terms of 
reference. In contrast, we have found that the Panel did not err in its application of Article  6.2 of the 
DSU in finding that Japan's three claims under Articles  3.1 and 3.5 of the Anti -Dumping  Agreement  
were within its terms of reference.384 Thus, the contrasting findings under Article  6.2 of the DSU 
regarding the different claims raised by Japan, which Korea contends are "internally inconsistent"385, 
reflect the Panel's error in its application of  this provision with regard to some of Japan's claims, 
rather than a lack of an objective assessment as required by Article  11 of the DSU. In any event, 
insofar as Japan's claims under Articles  3.1 and 3.5 are concerned, we have found no error in the 
Panel 's finding pursuant to Article  6.2 of the DSU that such claims were within its terms of reference. 
Thus, we disagree with Korea's contention that the Panel acted inconsistently with its obligation 
under Article  11 of the DSU in assessing the consistency wi th Article  6.2 of the DSU of Japan's claims 
under Articles  3.1 and 3.5 of the Anti -Dumping Agreement.  
5.158.   Furthermore, we observe that in making this claim under Article  11 of the DSU, Korea 
essentially identifies the same alleged errors by the Panel as those  developed in its claim that the 
Panel erred in its application of Article  6.2 of the DSU in finding that Japan's claims 4, 5, and 6 are 
within the Panel's terms of reference . As such, therefore, Korea's claim that the Panel acted 
inconsistently with Article 11 of the DSU is subsidiary to its other claims  of error by the Panel , and 
therefore does not "stand on its own", as a claim under Article  11 of the DSU would be required 
to.386 For the foregoing reasons, we find that the Panel did not act inconsistently with Article  11 of 
the DSU in assessing the consistency of Japan's panel request with Article  6.2 of the DSU.  
5.3.3   Magnitude of margin of dumping  
5.159.   Japan appeals the Panel's conclusion that Japan failed to demonstrate that the KTC's 
evaluation of the magnitude of  the margin of dumping was inconsistent with Articles  3.1 and 3.4 of 
the Anti -Dumping Agreement .387 Japan claims that the Panel erred in its interpretation and 
application of these provisions and requests the Appellate  Body to reverse the Panel's conclusion.388 
In response, Korea maintains that the Korean investigating authorities properly evaluated in a 
substantive manner the magnitude of the margin of dumping as part of its overall evaluation of 
injury.389 On this basis, Korea  requests the Appellate  Body to uphold the Panel's conclusion at 
issue.390 
5.160.   Before examining Japan's claim of error on appeal, we summarize the Panel's relevant 
findings and conclusions under Articles  3.1 and 3.4. We then set out our understanding of the 
relevant aspects of Articles  3.1 and  3.4 and examine the merits of Japan's claim of error on appeal.  
5.3.3.1   The Panel's findings  
5.161.   Before the Panel, Japan argued that the KTC's finding regarding the magnitude of the margin 
of dumping "has no factual support, and is con tradicted by the fact that the prices of the dumped 
imports were consistently higher than domestic like product prices".391 In response, Korea argued 
that "[the] KTC reasonably concluded that the magnitude of the dumping margins was not 
                                                
384 See sections 5.3.2.4 -5.3.2.6 above.  
385 Korea's other appellant's submission, para.  265. 
386 See para.  5.154  above and supra  fn 382. 
387 Japan's appellant's submission, para.  255 (refe rring to Panel  Report, paras.  7.187 -7.191).  
388 Japan's appellant's submission, paras.  255-268. 
389 Korea's appellee's submission, para.  424. 
390 Korea's appellee's submission, paras.  410 and  424. 
391 Panel  Report, para.  7.144.b (referring to Japan's first written submission to the Panel, 
paras.  177-178).  
 WT/DS504/AB/R  
 
- 57 - 
 
  insignificant and tha t such magnitude had a significant impact on the interaction between the sales 
prices of the dumped imports and the like product."392 The KTC's finding at issue states:  
As discussed previously, the final dumping margins of the dumped products were ranged 
between 11.66% and 31.61%, which means the size of dumping margin is not 
insignificant. Accordingly, such dumping appears to have had significant impact on the 
sales price of the dumped products and that of the like product.393 
5.162.   In its examination of Japan's cla im, the Panel first noted that " Article  3.4 does not require 
that the magnitude of the margin of dumping be evaluated in any particular manner or be given any 
particular weight."394 However, the Panel also found that "an evaluation of the magnitude of the 
margin of dumping in the assessment of the impact of dumped imports on the domestic industry 
must 'be undertaken as a substantive matter'."395 Specifically, "[a]n investigating authority is 
required to evaluate the magnitude of the margin of dumping and to ass ess its relevance and the 
weight to be attributed to it in the injury assessment."396 According to the Panel, a simple "listing of 
the margins of dumping" in other aspects of an investigation "is not sufficient to demonstrate that 
the magnitude of the margin  of dumping was evaluated within the meaning of Article  3.4".397 
5.163.   In applying Article  3.4 to the facts of this dispute, the Panel found that "the KTC did more 
than merely list or indicate the existence of margins of dumping of a particular magnitude in its 
determination ."398 Specifically, in light of the KTC's findings set out above, the Panel found that the 
KTC "observed that the dumping margins were significant, and consequently that dumping had had 
a significant impact on prices of both the dumped product and  the domestic like product".399 
Therefore, the Panel found that the KTC's findings are "sufficient to demonstrate that it evaluated 
the magnitude of the margins of dumping 'as a substantive matter'".400 
5.164.   Japan argued before the Panel that "an investigating auth ority is required  to undertake some 
form of counterfactual analysis, specifically in this case by adding the dumping margin to the actual 
prices of the dumped imports, or comparing the magnitude of the dumping margin with the level of 
overselling."401 In res ponse, Korea contended that "Japan is not able to refer to any textual or 
jurisprudential" basis to support such a counterfactual analysis.402 The Panel rejected Japan's 
argument, recalling that "there is no guidance in the Anti -Dumping Agreement  regarding 
methodology for the evaluation of economic factors in the context of Article  3.4", and, as such, there 
is no textual basis for Japan's argument.403 The Panel also found that, "even assuming that such an 
analysis might be relevant, a question which is for an i nvestigating authority to consider in the first 
instance, Japan has failed to demonstrate what specific factual circumstances made such an analysis 
obligatory in this case."404 On this basis, the Panel concluded that Japan failed to establish that the 
Korean  investigating authorities acted inconsistently with Articles  3.1 and 3.4 of the Anti -Dumping 
                                                
392 Korea's first written submission to the Panel, para.  231. Korea further contended that "[the] KTC 
examined this factor and explained the basis for finding that the magnitude of the dumping detrimentally 
affected the domestic industry." (Korea's second written submission to the Panel, para.  109 (fn  omitted))  
393 Panel  Report, para.  7.188 (quoting KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)), p.  26). 
394 Panel  Report, para.  7.189.  
395 Panel  Report, para.  7.189 (quoting Panel  Reports, China – HP-SSST (Japan) / China  – HP-SSST (EU) , 
para. 7.162).  
396 Panel  Report, para.  7.189 (quoting Panel  Report, China – X-Ray Equipment , para.  7.183).  
397 Panel  Report, par a. 7.189 (referring to Panel  Reports, Argentina – Poultry Anti -Dumping Duties , 
para. 7.321; China – X-Ray Equipment , paras.  7.183 -7.184; Russia – Commercial Vehicles , para.  7.161; 
China  – HP-SSST (Japan) / China – HP-SSST (EU) , paras.  7.161 -7.162).  
398 Panel  Report, para.  7.190.  
399 Panel  Report, para.  7.190.  
400 Panel  Report, para.  7.191.  
401 Panel  Report, para.  7.191 (referring to Japan's response to Panel question Nos.  45 and 46, paras.  91 
and 95). (emphasis original)  
402 Korea's sec ond written submission to the Panel, para.  111. 
403 Panel  Report, para.  7.191.  
404 Panel  Report, para.  7.191.  
 WT/DS504/AB/R  
 
- 58 - 
 
  Agreement with respect to the examination of the impact of the dumped imports on the state of the 
domestic industry.405 
5.3.3.2   Whether the Panel erred in its interpretatio n of Articles  3.1 and 3.4 of the 
Anti-Dumping Agreement  
5.165.   Article  3.4 of the Anti -Dumping Agreement provides:  
The examination of the impact of the dumped imports on the domestic industry 
concerned shall include an evaluation of all relevant economic factors and indices having 
a bearing on the state of the industry, including actual and potential decline in sales, 
profits, output, market share, productivity, return on investments, or utilization of 
capacity; factors affecting domestic prices; the magnitude of the margin of dumping; 
actual and potential negative effects on cash flow, inventories, employment, wages, 
growth, ability to raise capital or investments. This list is not exhaustive, nor can one 
or several of these factors necessarily give decisive guida nce. 
5.166.   The first sentence of Article  3.4 requires an  examination of the impact  of dumped imports 
on the domestic industry. Article  3.4 is thus  concerned with "the relationship between subject 
imports and the state of the domestic industry".406 Hence, the provision contemplates that "an 
investigating authority must derive an understanding of the impact of  subject imports" on the 
domestic industry407, which "requires an examination of the 'explanatory force' of subject imports 
for the state of the domestic industry".408 However, under Article  3.4, an investigating authority is 
"not required to  demonstrate  that dumped imports are causing injury to the dom estic industry, 
which is an analysis specifically mandated by Article  3.5".409 
5.167.   As noted , the focus of the examination required under Article  3.4 is on the state of the 
domestic industry .410 This examination " shall include an evaluation of all relevant economic  factors 
and indices having a bearing on the state of the industry".411 This provision  lists 15 factors that must 
be evaluated for this purpose412, one of which is the magnitude of the margin of dumping. As 
provided in the last sentence of Article  3.4, the lis t of 15 factors is not exhaustive, nor can one or 
several of these factors necessarily give decisive guidance. Rather, the examination stipulated under 
Article  3.4 requires a holistic evaluation of " all relevant economic factors and indices having a bearin g 
on the state of the industry" as a whole. Article  3.4 thus does not require an individual or separate 
finding of the relationship between the magnitude of the margin of dumping and the state of the 
domestic industry.  
5.168.   The obligation under Article  3.4 is f urther informed by the overarching obligation in 
Article  3.1413, which requires that a determination of injury "be based on positive evidence and 
involve an objective examination". Based on the obligations under Articles  3.1 and 3.4 set out above, 
the Appell ate Body has stated that " Article  3.4, read together with Article  3.1, instructs investigating 
authorities to evaluate, objectively and on the basis of positive evidence, the importance and the 
weight to be attached to all the relevant factors."414 Apart fro m the parameters described above, 
Articles  3.1 and 3.4 do not prescribe a particular methodology for the evaluation of, or relevance or 
                                                
405 Panel  Report, para.  7.192. In reaching this conclusion, the Panel also rejected Japan's argument that 
the KTC's evaluation of another factor listed in Article  3.4, i.e. the domestic industry's ability to raise capital or 
investment, was conclusory and without any factual support. (Panel  Report, paras.  7.144.a and 7.181 -7.186) 
These findings of the Panel are not subject to appeal. (Japan's appellant's submission, para.  255) 
406 Appellate  Body Report, China – GOES , para.  149. 
407 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.205 (quoting 
Appellate  Body Report, China – GOES , para.  149). (emphasis original)  
408 Appellate  Body Re ports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.205 (quoting 
Appellate  Body Report, China – GOES , para.  149).  
409 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.205 (referring to 
Appellate  Body Report, China – GOES , para.  150). (emphasis original)  
410 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.204.  
411 Emphasis added.  
412 Appellate  Body Report, Thailand – H-Beams , paras.  125 and 128 . 
413 Appellate  Body Report, Thailand – H-Beams , paras. 90 and 106.  
414 Appellate  Body Reports, China – HP-SSST (Japan) / China  – HP-SSST (EU) , para.  5.207.  
 WT/DS504/AB/R  
 
- 59 - 
 
  weight to be attributed to, any one factor.415 Thus, Articles  3.1 and 3.4 do not prescribe a particular 
relevance or weigh t to be attributed to the magnitude of the margin of dumping per se in the overall 
assessment of the impact of dumped imports on the domestic industry.  
5.169.   We recall the Panel's statement that Article  3.4 requires that "an evaluation of the magnitude 
of the margin of dumping in the assessment of the impact of dumped imports on the domestic 
industry must 'be undertaken as a substantive matter'" and that "[a]n investigating authority is 
required to evaluate the magnitude of the margin of dumping and to assess i ts relevance and the 
weight to be attributed to it in the injury assessment."416 In our view, the Panel's articulation of the 
legal standard under Article  3.4, insofar as the magnitude of the margin of dumping is concerned, 
comports with a proper interpretation of the provision as set out above.  
5.170.   On appeal, Japan argues that "[a]n evaluation of the magnitude of the margins of dumping 
plays an important role when examining the explanatory force of the dumped imports for the state 
of the domestic indu stry."417 According to Japan, "[t]o address the ultimate question under 
Article  3.5, the assessment of the relevance of the magnitude of the margin of dumping and the 
weight to be attributed to that margin under Article  3.4 must take into account the relatio nship 
among the dumping margins, the actual prices of the dumped imports, and the prices of the domestic 
like products in the market."418 Thus, in Japan's view, "an investigating authority must evaluate the 
dumping margin in light of the interaction of the p rices between the dumped imports and the 
domestic like products"419, and the Panel erred in its interpretation to the extent it suggested 
otherwise.420 
5.171.   In response, Korea contends that the Panel correctly interpreted Articles  3.1 and 3.4 by 
"reject[ing] the me re listing approach and confirm[ing] that a more substantive analysis [of the 
magnitude of the margin of dumping] was required".421 However, Korea submits that there is no 
basis in the text of Article  3.4 for Japan's argument that "something more was legally  required" and  
that in any event, Japan "fail[ed] to clarify what that 'something substantive' should be in addition 
to the substantive evaluation as undertaken by the KTC".422 
5.172.   We recall that Article  3.4 requires an evaluation of " all relevant economic facto rs and indices 
having a bearing on the state of the industry".423 As such, while Article  3.4 requires an examination 
of the explanatory force of subject imports on the state of the domestic industry through an 
evaluation of  all the relevant factors collectiv ely, it does not follow that a particular factor should be 
evaluated in a particular manner or given a particular relevance or weight. We do not preclude that, 
in light of the particular circumstances of a case, an investigating authority may find it usefu l or 
even necessary to assess the relationship between the magnitude of dumping margins and prices of 
dumped and domestic like product in order to derive an understanding of the impact of subject 
imports on the state of the domestic industry. However, we d o not consider that such an assessment 
is always required in order to evaluate the magnitude of the margin of dumping pursuant to 
Article  3.4. We therefore consider that the Panel correctly found that "there is no guidance in the 
Anti-Dumping Agreement  regarding methodology for the evaluation of economic factors in the 
context of Article  3.4" and that there is no textual basis for Japan's argument that an evaluation 
must be done in the particular manner suggested by Japan.424 
5.173.   In support of its contention, Jap an relies on the negotiating history of the Anti -Dumping 
Agreement , namely comments expressed during the Uruguay Round negotiations stating that the 
causal link between dumping and material injury to the domestic industry is tenuous where the 
margins of pr ice undercutting by dumped imports are substantially higher than the dumping 
                                                
415 Appellate  Body Reports, China – HP-SSST (Japan) / China  – HP-SSST (EU) , para.  5.204.  
416 Panel  Report, para.  7.189. (fns  omitted)  
417 Japan's appellant's submission, para.  258. 
418 Japan's appellant's submission, para.  258. 
419 Japan's appellant's submission, para.  262. (emphasis added)  
420 Japan's appellant's submission, para.  256. 
421 Korea's appelle e's submission, para.  418. 
422 Korea's appellee's submission, para.  419. 
423 Emphasis added.  
424 Panel  Report, para.  7.191.  
 WT/DS504/AB/R  
 
- 60 - 
 
  margins.425 We find this argument unpersuasive. First, the quoted comments relate to the question 
of causation, addressed in Article  3.5, not the examination of the impact under Article 3.4.426 
Second, those comments do not suggest that a particular method should be applied for evaluating 
the magnitude of the margin of dumping in an examination of the impact of the dumped imports on 
the domestic industry. They merely reflect situations  in which the comparisons between the dumping 
margins and the margins of underselling by dumped imports may be relevant for assessing the 
causal link between the dumped imports and injury. Third, the situations referred to in those 
comments are based on hy pothetical fact patterns that are distinguishable from the facts in the 
current case and are thus further limited in their relevance to the case before us.427 
5.174.   In sum, we find that Articles  3.1 and 3.4 require an investigating authority to evaluate the 
magnit ude of the margin of dumping and to assess its relevance and the weight to be attributed to 
it in the injury assessment. However, we do not consider that these provisions require any one of 
the listed factors, such as the magnitude of the margin of dumping , to be evaluated in a particular 
manner or given a particular relevance or weight, in examining the impact of the dumped imports 
on the domestic industry. Based on the above considerations, we find that the Panel did not err in 
its interpretation of Articles  3.1 and 3.4 of the Anti -Dumping Agreement  with respect to the 
evaluation of the magnitude of the margin of dumping.  
5.3.3.3   Whether the Panel erred in its application of Articles  3.1 and 3.4 of the  
Anti-Dumping  Agreement with respect to the KTC's finding s on the magnitude of the 
margin of dumping  
5.175.   Japan challenges the Panel's application of Article  3.4 of the Anti -Dumping Agreement  to the 
KTC's findings with respect to the magnitude of the margin of dumping, arguing that the KTC's 
findings were not based o n an objective examination and positive evidence.428 In particular, Japan 
recalls that, according to the Panel, the KTC's findings that the "size of the dumping margin is not 
insignificant" and that "such dumping appears to have had a significant impact" on prices were 
sufficient for purposes of conducting an evaluation of the magnitude of the margin of dumping under 
Article  3.4.429 Japan challenges this finding by the Panel, and argues that the KTC's findings were 
"not explained at all".430 According to Japan, "[t]he dumping margin alone is insufficient, because 
whether and to what extent the dumping margin may have any impact on the domestic prices 
depends on the degree of competition between the dumped imports and the domestic like 
products."431 In Japan's view, "[t]he fact that Article  3.4 does not specify any particular method does 
not mean the [investigating] authorities need do nothing."432 
5.176.   In response, Korea argues that "[the] KTC had already established that domestic prices of 
the like products were substantia lly suppressed by the selective low pricing and aggressive 
marketing behavior of the Japanese respondents" and that "[s]uch aggressive marketing was 
supported by the dumped imports' substantial dumping margins."433 Korea also argues that " [the] 
                                                
425 Japan's appellant's submission, paras.  259-261 and fns  365-366 thereto (quoting 
MTN.GNG/NG8/W/10, p.  7; MTN.GNG/NG8/W/51/Add.1, p.  5, paras. 22-23). 
426 See Japan's appellant's submission, paras.  259-260. Specifically, we note that the quoted comment 
by Korea (MTN.GNG/NG8/W/10, p.  7) was made in connection with Articles  3.2 and 3.4 of the Tokyo Round 
Agreement in Implementation of Article  VI of the Genera l Agreement on Tariffs and Trade, BISD 26S/171, 
entered into force 1  January  1980, which were provisions addressing the volume of the dumped imports and 
the effect of the dumped imports on prices and causation, respectively. Similarly, we note that the quo ted 
comment by Hong Kong (MTN.GNG/NG8/W/51/Add. 1, p.  5, paras.  22-23) was made in connection with 
Article  3.4 of the Anti -Dumping Code addressing causation.  
427 For instance, the quoted comment by Korea illustrates a situation where the margin of dumping is  
de minimis  (1%) and the margin of price underselling by dumped imports is 30%. (See Japan's appellant's 
submission, para.  259 (quoting MTN.GNG/NG8/W/10, p.  7)) The quoted comments also assume that the 
margins of dumping and the margins of underselling are  comparable (for example, in the quoted comment by 
Korea, a 1% dumping margin was compared with a 30% underselling margin to conclude that the underselling 
margin would have been 29% in the absence of dumping). (Ibid.) Japan has not established that either  of the 
above scenarios is analogous to the facts in the anti -dumping investigation at issue.  
428 Japan's appellant's submission, para.  265. 
429 Japan's appellant's submission, para.  263. (fn  omitted)  
430 Japan's appellant's submission, para.  264. 
431 Japan's appe llant's submission, para.  265. 
432 Japan's appellant's submission, para.  265. 
433 Korea's appellee's submission, para.  422. 
 WT/DS504/AB/R  
 
- 61 - 
 
  OTI verified that the domestic industries could have raised the sales price of the like product to the 
level of the reasonable sales prices if there had been no dumping, based on the magnitude of 
dumping margins and the range of 'reasonable sales prices'."434 Thus, in Ko rea's view, " [the] KTC 
reasonably concluded that the magnitude of the dumping margins was not insignificant and that 
such magnitude had a significant impact on the interaction between the sales prices of the dumped 
imports and the like product."435 On this b asis, Korea argues that the Panel was correct in finding 
that the KTC engaged in a substantive analysis of the magnitude of the margin of dumping as 
required under Article  3.4.436 
5.177.   As we recall, the Panel found that "the KTC did more than merely list or indic ate the existence 
of margins of dumping of a particular magnitude in its determination."437 Indeed, the KTC's findings 
set out by the Panel confirm the Panel's finding that the KTC "observed that the dumping margins 
were significant, and consequently that du mping had had a significant impact on prices of both the 
dumped product and the domestic like product".438 As such, we do not consider that the KTC did 
"nothing" or that its evaluation of the magnitude of the margin of dumping was limited to the 
"dumping mar gin alone" , as asserted by Japan . 
5.178.   Japan further contends that the KTC's findings regarding the magnitude of the margin of 
dumping were "not explained at all"439 and that the impact that the dumping margin may have on 
the domestic prices depends on "the degre e of competition between the dumped imports and the 
domestic like products" .440 As noted above, we do not rule out that, in light of the particular 
circumstances of a case, an investigating authority may find it useful or even necessary to assess 
the relationship between the dumping margins and prices for purposes of evaluating the magnitude 
of the dumping margin under Article  3.4. In this regard, as Japan argues, "the degree of competition 
between the dumped imports and the domestic like products"441 may shed some light on the 
investigating authority's understanding of the impact of dumped imports on the domestic industry 
when evaluating the magnitude of the margin of dumping. In the present case, however, the KTC 
considered the competitive relationship between the dumped imports and the domestic like product 
and found that there was evidence of instances of "fierce " competition.442 The Panel fo und no errors 
in the KTC's finding concerning the competitive relationship.443 Thus, in light of the competitive 
relationship between the dumped imports and the domestic like product found by the KTC, we do 
not consider that Japan has established that the KT C's findings regarding the magnitude of the 
margin of dumping were "not explained at all"444 or that the Panel erred in finding that the KTC's 
findings are "sufficient to demonstrate that it evaluated the magnitude of the margins of dumping 
'as a substantive  matter'".445 
5.179.   Finally, we turn to Japan's argument that the KTC was required to conduct "some form of 
counterfactual analysis".446 According to Japan, the investigating authority should pay particular 
attention to the "impact of the margin of dumping" when exa mining the magnitude of the margin of 
dumping under Article  3.4447, a factor that is particularly important in understand ing "what the state 
of the domestic industry would have been without any dumping".448 The Panel assessed Japan's 
argument and found that, " even assuming that such an analysis might be relevant, a question which 
                                                
434 Korea's appellee's submission, para.  422. (fn  omitted)  
435 Korea's appellee's submission, para.  422. 
436 Korea's appellee's submission, pa ras. 421 and 423 -424. 
437 Panel  Report, para.  7.190.  
438 Panel  Report, para.  7.190.  
439 Japan's appellant's submission, para.  264. 
440 Japan's appellant's submission, para.  265. 
441 Japan's appellant's submission, para.  265. 
442 Panel  Report, para.  7.294.  
443 Panel  Report, para.  7.295.c. The Panel reached this finding in the context of its review of the KTC's 
consideration of diverging price trends, which we examine in section 5.3.4.1.2.2 below.  
444 Japan's appellant's submission, para.  264. 
445 Panel  Report, para . 7.191.  
446 Panel  Report, para.  7.191 (referring to Japan's response to Panel question Nos.  45 and 46, paras.  91 
and 95). According to Japan, such counterfactual analysis may be conducted either by adding the dumping 
margin to the actual prices of the dumpe d imports, or by comparing the magnitude of the dumping margin 
with the level of overselling. (Ibid.) See also Japan's appellant's submission, para.  258 (referring to 
Appellate  Body Report, US – Tax Incentives , fn 177 to para.  5.77).  
447 Japan's appellant's submission, para.  266. 
448 Japan's appellant's submission, para.  267. 
 WT/DS504/AB/R  
 
- 62 - 
 
  is for an investigating authority to consider in the first instance, Japan has failed to demonstrate 
what specific factual circumstances made such an analysis obligatory in this case."449 On appeal, 
Japan contends that, "in a case where import prices are overselling the domestic prices, the 
[investigating] authorities cannot assume without more that the 'margin of dumping' is having any 
impact on the domestic industry at all."450 
5.180.   In the pre sent case, Japan relies on the overselling by the dumped imports as the basis for 
requiring a counterfactual analysis . However, we recall that, before specifically evaluating the 
magnitude of the dumping margin, the KTC had already considered the price eff ects of the dumped 
imports and assessed the interactions between the imported and domestic prices.451 In particular, 
the Panel did not find any error in the KTC's finding that there was evidence of competition between 
the dumped imports and the domestic like  product  in the Korean market for valves452, 
notwithstanding the average price overselling by the dumped imports. Thus, we do not consider that 
the Korean investigating authorities "assume[d] without more that the 'margin of dumping' [was] 
having any impact on the domestic industry".453 While a counterfactual analysis may be useful in 
certain circumstances , we consider that Japan has not established that the existence of overselling 
in this case necessarily renders a counterfactual analysis obligatory under Article 3.4.454 As such, we 
find that the Panel did not err in finding that "Japan has failed to demonstrate what specific factual 
circumstances made [the proposed counterfactual] analysis obligatory in this case."455 
5.181.   In sum, we find that Japan has failed to subs tantiate  that: (i) the Korean investigating 
authorities did not evaluate the magnitude of the margin of dumping as required under Articles  3.1 
and 3.4; and (ii) the Korean investigating authorities were required to conduct a counterfactual 
analysis in light of the facts of the case. Based on the above considerations, we uphold  the Panel's 
finding, in paragraphs 7.189 -7.192 and 8.3 .a of the Pa nel Report, that Japan failed to establish that 
the Korean investigating authorities acted inconsistently with Articles  3.1 and 3.4 of the 
Anti-Dumping Agreement  with respect to their evaluation of the magnitude of the margin of 
dumping.  
5.3.4   Causation  
5.182.   We now turn to examine Japan's appeal and Korea's other appeal concerning the Panel's 
findings under Articles  3.1 and 3.5 of the Anti -Dumping  Agreement. We recall that before the Panel, 
Japan raised three claims with respect to Articles  3.1 and 3.5 of the Anti -Dumping  Agreement. First, 
Japan argued that the KTC failed to demonstrate the existence of a causal link between the dumped 
imports and the state of the domestic industry in the absence of sufficient correlation between the 
trends in volumes, prices, and the  domestic industry's profits (claim 4).456 Second, Japan argued 
that the KTC failed to undertake a proper non -attribution analysis inasmuch as it failed to conduct 
an objective analysis of certain known factors other than the dumped  imports allegedly causing  
injury to the domestic industry at the same time as dumped imports and failed to examine at all 
some other known factors (claim 5).457 Finally, Japan claimed that the KTC's causation determination 
was undermined by its flawed analyses of the volume of the d umped imports, the price effects, and 
the impact of the dumped imports on the state of the domestic industry, "irrespective and 
independent" of whether the Panel found the KTC's analyses of the volume, price effects, and impact 
of the dumped imports on the  domestic industry to be inconsistent with Articles  3.2 and 3.4 of the 
Anti-Dumping  Agreement (claim 6).458 The Panel referred to this as the "independent" causation 
claim.  
                                                
449 Panel  Report, para.  7.191.  
450 Japan's appellant's submission, para.  267. 
451 Panel  Report, para.  7.115 (referring to KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)), p.  19). 
452 Panel  Report, para.  7.295.c.  
453 Japan's appellant's submission, para.  267. 
454 In response to questioning at the oral hearing, Japan acknowledged that the counterfactual analysis 
it proposed in this case would have been imperfect at best, given that there were multipl e exporters with 
different margins of dumping.  
455 Panel  Report, para.  7.191.  
456 Panel  Report, para.  7.196.  
457 Panel  Report, para.  7.198. On appeal, Japan does not challenge the Panel's findings in this regard. 
(Japan's appellant's submission, fn  384 to para.  273) 
458 Panel  Report, para.  7.195 (referring to Japan's first written submission to the Panel, paras.  192-196; 
second written submission to the Panel, paras.  153-154).  WT/DS504/AB/R  
 
- 63 - 
 
  5.183.   The Panel chose first to address Japan's claim 6, followed by Japan's claims 4 and 5.  The 
Panel's findings on Japan's claims 4 and 6, set out above, are subject to appeal.  
5.184.   With respect to claim 6, Japan and Korea each appeal different aspects of the Panel's 
findings. We begin our analysis with Korea's claim on appeal that the Panel erred in its interpretation 
and application of Article  3.5 of the Anti -Dumping  Agreement by subsuming all of the obligations of 
Articles  3.2 and 3.4 of the Anti -Dumping  Agreement under that provision in addressing Japan's 
"independent" causation claim. Next, we address Japan's claim on appeal that the Panel erred in its 
approach to resolving Japan's "independent" causation claim by failing to consider volume, price 
effects, and impact as essential building blocks for any finding of causation under Article  3.5. Th en, 
we turn to examine Japan's claim that the Panel erred under Article  11 of the DSU and Article  17.6 
of the Anti -Dumping  Agreement by failing to consider Japan's rebuttal arguments on the issue 
regarding the "reasonable sales price" in the context of Jap an's "independent" causation claim. 
Thereafter, we address the claims raised by Korea concerning the Panel's findings on price 
comparability and overselling in addressing Japan's "independent" causation claim. We then turn to 
Korea's claim that the Panel e rred under Article  11 of the DSU and Article  17.6 of the 
Anti-Dumping  Agreement in failing to make an objective assessment of the matter. Finally, we 
address Japan's claim on appeal that the Panel improperly refused to address the lack of meaningful 
correl ation in the context of the obligation under Article  3.5 and, therefore, erred in its approach to 
resolving Japan's claim 4 regarding the failure to demonstrate a causal relationship.  
5.3.4.1   Japan's "independent" causation claim (claim 6)  
5.3.4.1.1   Whether the Panel erred in its interpretation or application of Article  3.5 by 
subsuming all of the obligations of Articles  3.2 and 3.4 under Article  3.5 of the 
Anti-Dumping Agreement  
5.185.   As noted, the Panel chose first to address Japan's "independent" causation claim. In that 
respe ct, the Panel considered that Japan raised an "independent  [claim] of violation of Article  3.5 
with respect to Korea's flawed volume, price effects, and impact analyses, even if the Panel should 
find that those flaws do not constitute violations of Articles  3.2 and 3.4".459 The Panel found that it 
could not preclude the possibility that an investi gating authority's determination of causation may 
be inconsistent with Article  3.5 of the Anti -Dumping  Agreement due to inadequacies in its analysis 
of the volume, price effects, or impact of dumped imports, even if th ese did not demonstrate a 
violation of  Articles  3.2 and/or 3.4 of the Anti -Dumping  Agreement.460 However, the Panel also noted 
that "[w]hile [Japan's] claim may be independent, Japan makes no new, separate or additional 
arguments in support of that claim, simply referring back to certain of the arguments it made in 
support of its claims under Articles  3.1, 3.2, and 3.4 to support its independent claim of inconsistency 
with Articles  3.1 and 3.5."461 For the purposes of assessing Japan's independent causation claim, 
the Panel decided to limit its exa mination to those specific aspects of the KTC's consideration of the 
volume and price effects, and its examination of the impact of dumped imports identified by Japan 
in its submissions as independently demonstrating the inconsistency of the KTC's determin ation of 
causation under Article  3.5.462 
5.186.   The Panel found that Japan failed to demonstrate that the Korean investigating authorities 
acted inconsistently with Articles  3.1 and 3.5 of the Anti -Dumping  Agreement because their 
causation determination was undermi ned by alleged flaws in their consideration of the significance 
of the increase in the volume of the dumped imports.463 The Panel found the Korean investigating 
authorities to have acted inconsistently with Articles  3.1 and 3.5 by failing to: (i) ensure pric e 
comparability when they compared the individual transaction prices of certain models of dumped 
imports with the average prices of corresponding models of the domestic like product (the relevant 
price comparisons)464; and (ii) adequately explain their consi deration of the price -suppressing 
and -depressing effects of dumped imports in their determination of causation, in light of the 
undisputed fact that the prices of the dumped imports were higher than those of the domestic like 
                                                
459 Panel  Report, para.  7.217. (emphasis original)  
460 Panel  Report, para.  7.221.  
461 Panel  Report, para.  7.222.  
462 Panel  Report, para.  7.227.  
463 Panel  Report, para.  7.258.  
464 Panel  Report, paras.  7.272 and 7.323.a.  
 WT/DS504/AB/R  
 
- 64 - 
 
  product  throughout the period  of trend analysis  on the basis of both the average price of the product 
as a whole and the average prices of representative models .465 The Panel, however, found that the 
different magnitude of the price decreases from 2012 to 2013 and the opposing price movements 
from 2011 to 2012 do not, in and of themselves, demonstrate that the KTC's determination of a 
causal relationship is inconsist ent with Articles  3.1 and 3.5.466 Finally, the Panel found that Japan 
failed to demonstrate that the Korean investigating authorities' determination of causation is, with 
respect to the analysis of the impact of dumped imports on the domestic industry and in dependently 
of any inconsistencies with Article  3.4, inconsistent with Articles  3.1 and  3.5 of the 
Anti-Dumping  Agreement.467 
5.187.   On appeal, Korea contends that the Panel "effectively" interpreted Article  3.5 of the 
Anti-Dumping  Agreement as setting forth an ind ependent, comprehensive obligation to examine the 
volume, price effects, and consequent impact of the dumped imports as part of the causation 
obligation of Article  3.5.468 Korea submits that the Panel "walks through the exact same questions 
of volume, price and overall impact that one would normally consider in the analyses under 
Articles  3.2 and 3.4 " of the Anti -Dumping  Agreement.469 Article  3.5, according to Korea, deals with 
a related but different and separate inquiry that concerns the existence of a causal  relationship 
between the injury, as established under Articles  3.2 and 3.4, on the one hand, and the dumped 
imports, on the other hand.470 Thus, Korea submits that the reference to paragraphs 2 and 4 in the 
first sentence of Article  3.5 does not call for re doing the examination under these paragraphs or 
render ing them redundant.471 
5.188.   In response, Japan submits that Korea is wrong to read the overall obligation in Article  3.5 
too narrowly.472 According to Japan, "[t]he analysis under Article  3.5 does not duplicate the analysis 
under Article  3.2, but rather extends the analysis and addresses distinct but critically important 
issues."473 For instance, Japan submits that "the Panel was correct to conclude that a thorough and 
objective examination of the price effects of imports serves as a critical and essential building block 
for any finding of causation under Articles  3.1 and 3.5."474 Japan contends that the first sentence of 
Article  3.5 in using the terms " through  the effects of dumping" makes clear that while " Articles  3.2 
and 3.4 are important building blocks, …  they do not end the analysis ."475 
5.189.   Article  3.5 of the Anti -Dumping  Agreement provides, in relevant part:  
It must be demonstrated that the dumped imports are, through the effects of dumping, 
as set forth in paragraphs  2 and  4, causing injury within the meaning of this  Agreement. 
The demonstration of a causal relationship between the dumped imports and the injury 
to the domestic industry shall be based on an examination of all relevant evidence 
before the auth orities. The authorities shall also examine any known factors other than 
the dumped imports which at the same time are injuring the domestic industry, and the 
injuries caused by these other factors must not be attributed to the dumped imports.  
5.190.   The first se ntence of Article  3.5 requires a demonstration that dumped imports are causing 
injury within the meaning of the Anti -Dumping Agreement  "through the effects of dumping, as set 
forth in paragraphs 2 and 4", i.e. Articles  3.2 and 3.4 of the Anti -Dumping  Agree ment. Article  3.2 
instructs an investigating authority to "consider" whether there has been a significant increase in 
the volume of dumped imports, and to "consider" the effect of the dumped imports on prices, namely 
whether there has been a significant pr ice undercutting, price depression, or price suppression by 
the imported products vis -à-vis domestic like products.476 Under Article  3.2, an investigating 
                                                
465 Panel  Report, paras.  7.322 and 7.323.c.  
466 Panel  Report, paras.  7.296 and 7.323.b.  
467 Panel  Report, para.  7.348.b.  
468 Korea's other appellant's submission, para.  186. 
469 Korea's other appellant's submission, para.  186. 
470 Korea's other appellant's submission, para.  184. 
471 Korea's other appellant's submission, para.  185. 
472 Japan's appellee's submission, para.  85. 
473 Japan's appellee's submission, para.  81. 
474 Japan's appellee's submission, para.  79. 
475 Japan's appellee's submission, para.  68 (quoting Article  3.5 of the Anti -Dumping Agreement). 
(emphasis added by Japan; additio nal fn  omitted)  
476 See also Appellate  Body Report, China – GOES , para.  129. 
 WT/DS504/AB/R  
 
- 65 - 
 
  authority considers the explanatory force of dumped imports for, inter alia , the occurrence of price 
effects, but it is not required to make "a definitive determination" on the volume of dumped imports 
and the effect of such imports on domestic prices.477 Article  3.4 in turn requires an investigating 
authority to "examin[e]" the impact of dumped imports on th e domestic industry on the basis of "an 
evaluation" of all relevant economic factors and indices that have a bearing on the state of the 
industry. As clarified by the Appellate  Body, while "Article  3.4 requires an examination of the 
'explanatory force' of subject imports for the state of the domestic industry"478, an investigating 
authority is not required to demonstrate under that provision whether subject imports are  causing 
injury to the domestic industry.479  
5.191.   Rather, the demonstration that "dumped … imports  are causing injury  'through  the effects 
of' dumping … '[a]s set forth in paragraphs  2 and 4'" is to be conducted by the investigating authority 
under the aegis of Article  3.5.480 The use of the phrase "as set forth in paragraphs 2 and  4" in 
Article  3.5 make s it clear that " proper assessment[s]" under Articles  3.2 and 3.4 are "necessary 
building block[s]"481, which " contribute [] to", rather than replicate, the "overall determination" of 
injury and causation that is required under Article  3.5.482 The first sentenc e of Article  3.5 thus 
suggests that these "building blocks" form part of and are "linked through a causation analysis 
between subject imports and the injury to the domestic industry, taking into account all factors that 
are being considered and evaluated".483 In requiring a "demonstrat[ion] that the dumped imports 
are, through the effects of dumping, as set forth in paragraphs  2 and  4, causing injury", the 
causation inquiry under Article  3.5 calls for a holistic assessment by an investigating autho rity that 
links together the considerations under Article  3.2 and the examination conducted under Article  3.4 
in order to reach a definitive determination regarding the existence of a causal relationship  between 
dumped imports and injury to the domestic in dustry. In this context, the inquiries under Articles  3.2 
and 3.4 "should not be viewed in isolation", as they are "necessary components"484 and form part 
of the "logical progression of inquiry leading to an investigating authority's ultimate injury and 
causation determination" .485  
5.192.   The use of the word "demonstrate[]" in Article  3.5 in contrast to the words "consider" in 
Article  3.2 and "examination" in Article  3.4 indicates that Article  3.5 establishes a standard that is 
distinct from Articles  3.2 and 3.4, inasmuch as  Article  3.5 is concerned with the establishment of the 
causal link between dumped imports and injury.486 Moreover, the second sentence of Article  3.5 
provides that the demonstration of a causal relationship between the dumped imports and the injury 
to the domestic industry shall be based on "an  examination of all relevant evidence  before the 
authorities".487 The use of the phrase "all relevant evidence" means that Article  3.5 covers a broad 
basket of evidence that encompasses, and is not limited to, th e evidence relating to the inquiries 
                                                
477 Appellate  Body Report, China – GOES , paras.  130 and 136. The Appellate  Body explained that 
"[i]nterpreting Article[] 3.2 … as requiring a consideration of the relationship between  subject imports and 
domestic prices does not result in duplicating the causation analysis under Article[] 3.5." (Appellate  Body 
Report, China  – GOES , para.  147) 
478 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.205 (quoting  
Appellate  Body Report, China – GOES , para.  149).  
479 Appellate  Body Report, China – GOES , para.  150. 
480 Appellate  Body Report, China – GOES , para.  128. (emphasis original)  
481 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.162.  
482 Appellate  Body Report, China – GOES , para.  149. (emphasis original)  
483 Appellate  Body Report, China – GOES , para.  128. (fn  omitted)  
484 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.141 (referring to 
Appellate  Body Report,  China – GOES , para.  128).  
485 Appellate  Body Report, China – GOES , para.  128. 
486 The Appellate  Body indicated that the word "consider" in Article  3.2 stands in contrast with the word 
"demonstrate" in Article  3.5 that requires an investigating authority to ma ke "a definitive determination 
regarding the causal relationship between subject imports and injury to the domestic industry". 
(Appellate  Body Report, China – GOES , para.  130 and fn  217 thereto)  
487 Emphasis added.  
 WT/DS504/AB/R  
 
- 66 - 
 
  under Articles  3.2 and  3.4.488 This suggests that Article  3.5 has a broader scope of examination than 
Articles  3.2 and 3.4.489 
5.193.   The overall context provided by Article  3 of the Anti -Dumping Agreement  thus makes it clear 
that the various paragraphs of Article  3, together, provide an investigating authority with the 
relevant framework and disciplines for conducting an injury and causation analysis.490 Articles  3.2 
and 3.4 are provisions that are intended "to develop  an investigating authority's overall examination" 
of injury and causation.491 The "outcome s" of these inquiries in turn form "the basis for the overall 
causation analysis contemplated in Article[] 3.5".492 In our view, reading these provisions in this 
manner comports with the fact that, while the inquiries foreseen under Articles  3.2, 3.4, and 3.5 are 
"interlinked elements of a single, overall analysis addressing the question of whether dumped 
imports are causing injury"493, the inquiry under each pro vision has a distinct focus.494  
5.194.   These considerations suggest that claims regarding alleged deficiencies in an investigating 
authority's analyses of the volume and price effects, and its examination of  the impact of the dumped 
imports on the state of the dom estic industry, are reviewable by a panel under Articles  3.2 and 3.4 , 
respectively, as these provisions contain the requirements pursuant to which the investigating 
authority conducts such analyses. In contrast, with respect to a claim under Article  3.5, a  panel is 
tasked with reviewing an investigating authority's ultimate demonstration that  the "dumped imports 
are, through the effects of dumping, as set forth in paragraphs 2 and 4 , causing injury " to the 
domestic industry. In so doing, a panel is called u pon to review whether the investigating authority 
properly linked the outcomes  of its analyses conducted pursuant to Articles  3.2 and  3.4, taking into 
account the evidence and factors required under Article  3.5, in coming to a definitive determination 
regarding the causal relationship between dumped imports and injury to the domestic industry. A 
panel's review of a claim under Article  3.5, therefore, concerns the investigating authority's ultimate 
determination of causation on the basis of a proper linkage among  the various components, in light 
of all evidence and factors set out in that provision. A panel's review does not, however, call for 
revisiting the question whether each of the interlinked components of this determination itself meets 
the applicable requirements set out in Article  3.2 or 3.4. Examining such consistency in the context 
of a claim under Article  3.5 would effectively require a panel to incorporate and apply requirements 
and disciplines set out in other paragraphs of Article  3, which are not contained in the text of 
Article  3.5. To that extent, we agree with Korea that the phrase "through the effec ts of dumping, as 
set forth in paragraphs  2 and  4" in Article  3.5 "is not a call [for a panel] to re -do the examination[s]" 
under Articles  3.2 and 3.4 of the Anti -Dumping Agreement .495 
5.195.   In the present dispute, we recall that the Panel excluded from its terms of reference Japan's 
claims regarding: (i) the inconsistency of the KTC's consideration of volume and price effects with 
Article  3.2; and (ii) the inconsistency of the KTC's examination of the impact of the dumped imports 
on the domestic industry with Article 3.4.496 As such, the Panel did not examine and make findings 
on these claims under Articles  3.2 and 3.4 of the Anti -Dumping Agreement . The Panel, however, 
found it to be within its terms of reference to examine claim 6 in Japan's panel request, in which 
Japan contended that the KTC's causation determination was undermined by its flawed analyses of 
                                                
488 We agree with the Panel that evidence tha t does not fall squarely within the parameters of 
Articles  3.2 and 3.4 may be relevant and persuasive with respect to whether a causal relationship can be 
demonstrated under Article  3.5. (Panel  Report, para.  7.248)  
489 The Appellate  Body stated that "[t]he e xamination under Article[] 3.5 … by definition[] covers a 
broader scope than the scope of the elements considered in relation to price depression and suppression under 
Article[] 3.2". (Appellate  Body Report, China – GOES , para.  147) 
490 Appellate  Body Report , China – GOES , para.  128. 
491 Appellate  Body Report, China – GOES , para.  144. (emphasis original)  
492 Appellate  Body Report, China – GOES , para.  149. 
493 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.141.  
494 We recall that, in the context of Articles  3.2 and 3.5 of the Anti -Dumping  Agreement, the 
Appellate  Body found that "[w]hile the assessments under both Article[s]  3.2 and 3.5 are interlinked elements 
of the single, overall injury analysis, the inquiry und er each provision has a distinct focus." (Appellate  Body 
Report, Russia – Commercial Vehicles , para.  5.54 (referring to Appellate  Body Reports, China – HP-SSST 
(Japan) / China – HP-SSST (EU) , para.  5.141 )) 
495 Korea's other appellant's submission, para.  185. 
496 We note that in the context of Japan's claim under Articles  3.1 and 3.4 of the Anti -Dumping 
Agreement, the Panel found that "Japan's claim concerning the state of the domestic industry, under 
Articles  3.1 and 3.4 of the Anti -Dumping  Agreement, is limite d to the allegation that the KTC failed to evaluate 
two of the specific factors listed in Article  3.4." (Panel  Report, para.  7.175)  
 WT/DS504/AB/R  
 
- 67 - 
 
  the volume of the dumped imports, the price effects, and the impact of the dumped imports on the 
state of the domestic industry, "irrespective and independent" of whether the Panel found the KTC's 
analyses of volume, price effects, and impact to be inconsistent with Articles  3.2 and 3.4.497 In 
explaining its understanding of the phrase "irrespective and independent" in claim 6, the Panel noted 
that it "[could not] preclude the possibility that an investigating authority's determination of 
causation may be inconsistent with Article  3.5 due to inadequacies in its analysis of the volume, 
price effects, or impact of dumped imports, even if these do not demonstrate a vio lation of 
Articles  3.2 and/or  3.4".498  
5.196.   As discussed above, given that Articles  3.2 and 3.4 contain the requirements pursuant to 
which an investigating authority conducts its volume, price effects, and impact analyses, a claim of 
alleged deficiencies in such  analyses is reviewable by a panel under these provisions. Furthermore, 
by virtue of the phrase "through the effects of dumping, as set forth in paragraphs  2 and 4" in the 
first sentence of Article  3.5, to the extent that a panel finds that an investigatin g authority's volume, 
price effects, and impact analyses  are inconsistent with its obligations under Articles  3.2 and 3.4, 
such inconsistencies would likely undermine an investigating authority's overall causation 
determination and consequentially  lead to an inconsistency with Article  3.5.499 However, the 
"possibility" referred to above by the Panel appears to concern a different scenario, in which an 
investigating authority's analyses of the volume, price effects, and impact "do not" themselves 
demonstrate a n inconsistency with Article  3.2 or Article  3.4, but nonetheless contain "inadequacies" 
that "independently" constitute a violation of Article  3.5. As noted above, the totality of the evidence 
and factors stipulated under Article  3.5, including the evidenc e underpinning an investigating 
authority's volume, price effects, and impact analyses, may be reviewed under Article  3.5 for the 
purpose of examining whether an investigating authority has demonstrated the requisite causal 
relationship.  We do not exclude that, based on such a review, a panel might find that an investigating 
authority erred under Article  3.5 in its demonstration of causation due to its failure to link properly 
its consideration of volume and price effects, and its examinat ion of  the impact on the state of the 
domestic industry, even where these elements, individually, may not breach the obligations set out 
in Articles  3.2 and 3.4 , respectively.500 To that extent, we do not find the Panel to have erred in its 
approach  merely b ecause it identified the "possibility" referred to above and proceeded to examine 
Japan's "independent" causation claim as set out in claim 6 in Japan's panel request.  
5.197.   However, Korea contends that the Panel simply accepted Japan's assertion that such an 
"independent" claim may exist but failed to give any example of such a "less evident" theoretical 
possibility.501 Rather, Korea contends that, in examining Japan's claim 6, the Panel "effectively" 
interpreted Article  3.5 as setting forth an independent, compr ehensive obligation to examine the 
volume, price effects, and impact of the dumped imports as part of the causation obligation of 
Article  3.5.502 We also note that Japan argues that the Panel failed to consider volume as an essential 
"building block" for cau sation by focusing too narrowly on the requirements of the first sentence of 
Article  3.2 and not on the proper analysis under Article  3.5 regarding causation.503 Similarly, Japan 
asserts that the Panel failed to consider impact as an essential "building bloc k" for causation by 
focusing too narrowly on the requirements of Article  3.2 concerning volume and price  effects , and 
Article  3.4 regarding impact, and not on the proper analysis under Article  3.5 regarding causation.504  
5.198.   Thus, in order for us to determine w hether, in applying Article  3.5 for the purpose of 
examining Japan's claim 6, the Panel erroneously "walk[ed] through" the exact same questions of 
volume, price  effects , and overall impact that one would normally consider in the analyses under 
Articles  3.2 and 3.4505, we review the Panel's findings under claim 6 in light of the claims and 
                                                
497 Panel  Report, para.  7.195 (referring to Japan's first written submission to the Panel, paras.  192-196; 
second written subm ission to the Panel, paras.  153-154).  
498 Panel  Report, para.  7.221.  
499 We note that such a consequential finding under Article  3.5 can be made to the extent that a 
complaining party advances a consequential claim in this regard.  
500 We note that Korea concedes  that "the situation could arise if the WTO -consistent volume, price and 
impact analyses, while individually correct, do not hold together for example because of a lack of coincidence in 
trends between these factors." (Korea's other appellant's submission,  para. 188) 
501 Korea's other appellant's submission, paras.  187-188. 
502 Korea's other appellant's submission, para.  186. 
503 Japan's appellant's submission, para.  277 (referring to Panel  Report, para.  7.258).  
504 Japan's appellant's submission, para.  289 (referring to Panel Report, para.  7.347).  
505 Korea's other appellant's submission, para.  186. 
 WT/DS504/AB/R  
 
- 68 - 
 
  arguments raised on appeal by Japan and Korea. We begin with Japan's argument that the Panel 
erred in its approach to resolving claim 6 by failing to consider volume as an e ssential building block 
for any finding of causation.  
5.3.4.1.2   Whether the Panel erred in its approach to resolving Japan's claim 6  
5.3.4.1.2.1   Whether the Panel failed to consider volume as an essential building block for 
any finding of causation  
5.199.   On appeal, Japan contends tha t the Panel rejected its argument by focusing too narrowly on 
the requirements of the first sentence of Article  3.2 of the Anti -Dumping  Agreement regarding 
volume, and not on the proper analysis under Article  3.5 of the Anti -Dumping  Agreement regarding 
causation.506 According to Japan, in order to determine whether the KTC conducted a proper 
causation analysis under Article  3.5, it was for "the Panel to consider [the volume -related ] facts and 
other facts as part of a holistic analysis of the KTC's finding of causation and how the KTC explained 
that finding ".507 Japan submits that the Panel did not do so and, instead, quoted the KTC's discussion 
of facts under the first sentence of Article  3.2, and then quoted the KTC's "overall evaluation".508 
Japan submits that t he KTC's "overall evaluation" about causation did not discuss any of the contrary 
facts and ignored the overall POI.509 
5.200.   In response, Korea avers that while Japan contends that the Panel approached Article  3.5 
"too narrowly", Japan does not explain "how or why that was the case and what the Panel should 
have done".510 Korea asserts that it is difficult to understand the "error  of law" that the Panel 
allegedly committed.511 In any event, Korea contends that the Panel did not just check a box but 
examined the volume analysis of  the KTC as part of its injury analysis.512 
5.201.   We recall that, before the Panel, Japan argued that "[t]he volum e of subject imports 
increased only modestly in absolute terms and had decreased market share over the full 2010 to 
2013 period", and that "this evidence … tended to disprove the existence of any 'causal 
relationship'."513 The Panel noted that "Japan's alleg ation that certain flaws in the KTC's analysis of 
the volume of dumped imports 'independently' undermine its causation determination"514 was based 
on the fact that: (i) the volume of dumped imports decreased during two years of the three -year 
period of trend  analysis; and (ii) the volume of dumped imports increased only modestly in absolute 
terms and decreased in terms of market share in 2013 compared with 2010.515 The Panel examined 
the KTC's consideration of the volume of dumped imports which, as Japan notes,  was found in "the 
KTC discussion of facts under the first sentence of Article  3.2".516 The Panel noted that the KTC 
"considered whether there was a significant increase in dumped imports in absolute terms, relative 
to domestic consumption , and relative to d omestic production".517 From each of these three 
perspectives, the KTC found that "the volume of the dumped imports decreased from 2010 to 2012, 
then increased sharply from 2012 to 2013."518 According to the Panel, the KTC neither relied on nor 
was required to  show a significant increase of dumped imports from 2010 to 2012 or over the entire 
period of trend analysis.519 The Panel further found that the KTC "examined the trends in volume 
and market share on an end -point to end -point basis  … [as well as on a] year -on-year [basis]"520, 
and "did not ignore the decline in dumped imports from 2010 to 2012".521  
                                                
506 Japan's appellant's submission, para. 277 (referring to Panel  Report, para.  7.258).  
507 Japan's appellant's submission, para.  278. 
508 Japan's appellant's submission, para.  278 (referring to Panel  Report, para.  7.252, in turn quoting 
KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)) , pp. 14 and 27) . 
509 Japan's appellant's submission, para.  278. 
510 Korea's appellee's submission, para.  433 (quoting Japan's appellant's submission, para.  277).  
511 Korea's appellee's submission, para.  433. 
512 Korea's appellee's submission, para.  435. 
513 Japan's first written submission to the Panel, para.  194. 
514 Panel  Report, para.  7.250.  
515 Panel  Report, para.  7.251.  
516 Japan's appellant submission, para.  278 (fn  omitted).  
517 Panel  Report, para.  7.253.  
518 Panel  Report, para.  7.253.  
519 Panel  Report, paras.  7.254 -7.257. 
520 Panel  Report, para.  7.257.  
521 Panel  Report, para.  7.254.  WT/DS504/AB/R  
 
- 69 - 
 
  5.202.   We note that Article  3.5 does not prescribe a particular methodology for evaluating the 
volume of imports for the purposes of demonstrating the causal link between d umped imports and 
injury to the domestic industry. Rather, Article  3.2, first sentence, requires an investigating authority 
to consider "whether there has been a significant increase in dumped imports, either in absolute 
terms or relative to production or consumption". Under Article  3.2, first sentence, these three 
methods do not operate to the mutual exclusion of each other and an investigating authority may 
opt to rely on one, two, or all of them for its analysis under that provision.  
5.203.   As we see it, the P anel's above analysis in the context of Japan's claim 6 reviewed the 
requirements set out in Article  3.2, first sentence, as opposed to those under Article  3.5 in 
addressing the causation claim  at issue. Indeed, in the absence of any specific requirements 
concerning the volume of dumped imports, Article  3.5 could not have guided the Panel's assessment 
of whether the KTC adequately explained the decrease in the volume of imports from 2010 to 2012 
in reaching its finding of a significant increase of the volum e of dumped imports. Rather, in reviewing 
Japan's argument that the market share of dumped imports decreased on an end -point to end -point 
basis, the Panel relied on the requirements set out in Article  3.2, first sentence. Specifically, the 
Panel noted that  the first sentence of Article  3.2 "sets out three parameters for the consideration of 
the volumes of the dumped import", and considered that "[t]he use of the disjunctive 'either  … or' 
in the first sentence of Article  3.2 suggests that an investigating au thority need only to consider 
whether there is a significant increase either in absolute terms or in relative terms ."522 The Panel 
correctly explained that "[t]he results of the investigat [ing] authority's consideration from any of 
these perspectives can ind ependently serve as a basis for its consideration of the ultimate causation 
question under Article  3.5."523 However, in reviewing the causation claim at issue , the Panel, in our 
view, effectively incorporated the requirements in Article  3.2, first sentence, concerning the volume 
of dumped imports, in its assessment of a claim under Article  3.5. As discussed above, in reviewing 
a claim under Article  3.5, a panel is not called upon to revisit the question whether each of the 
interlinked com ponents of this determination, such as the investigating authority's volume analysis, 
is itself consistent with the applicable requirements set out in Article  3.2. Rather, the task of a panel 
in addressing a claim under Article  3.5 is to review whether the  investigating authority properly 
linked the outcomes  of its analyses conducted pursuant to Articles  3.2 and  3.4 taking into account 
the evidence and factors required under Article  3.5, in coming to a definitive determination regarding 
the causal relations hip between dumped imports and injury to the domestic industry. We find the 
Panel to have used the first sentence of Article  3.2 as "the template for its analysis"524 of the 
causation claim at issue, rather than properly applying the requirements set out in Article  3.5. We 
therefore consider the Panel to have erred in its application of Article  3.5 of the Anti -Dumping 
Agreement . 
5.204.   This does not, however, conclude our examination regarding Japan's contention that it has 
demonstrated that the KTC's volume analysi s contains flaws that "independently" undermined its 
causation determination. Japan contends that, while a finding of significant increase in the absolute 
level of imports over a one -year period might be sufficient to comply with the first sentence of 
Article 3.2 in certain cases, "the implications of the volume of imports for purposes of causation 
[analysis] under Article  3.5 become very different" if the increase: (i) is "merely regaining the 
historical level of imports"; and (ii) "actually represents a l oss of market share".525 However, we do 
not find specific arguments in Japan's submissions that substantiate the alleged "implications" of the 
import volume for the causation analysis under Article  3.5. Furthermore, although Japan rightly 
contends that the P anel, in the context of the causation claim at issue, was required to consider the 
volume -related facts and other facts "as part of a holistic analysis of the KTC's finding of causation 
and how the KTC explained that finding", Japan has not identified whic h "other facts" the Panel 
should have considered as part of "a holistic analysis" of the KTC's finding of causation.526 We 
therefore do not consider Japan to have substantiated its "independent" claim that the KTC acted 
inconsistently with the requirements o f Articles  3.1 and 3.5  of the Anti -Dumping Agreement  by 
focusing solely on one of the years of the three -year POI. 
                                                
522 Panel  Report, fn  358 to para.  7.257.  
523 Panel  Report, fn  358 to para.  7.257. (emphasis omitted)  
524 Japan's appellant's submission, para.  277. 
525 Japan's appellant's submission, para.  279. 
526 Japan's ap pellant's submission, para.  278. WT/DS504/AB/R  
 
- 70 - 
 
  5.3.4.1.2.2   Whether the Panel failed to consider price effects as an essential building 
block for any finding of causation  
5.205.    Before the Panel, Japan advan ced three grounds in support of its claim that the KTC's 
analysis of the price effects of dumped imports "independently" undermined its causation 
determination, namely that: (i) there was a divergence between the trends in  prices of  dumped 
import s and dome stic like product; (ii) dumped imports consistently and significantly oversold the 
domestic like product; and (iii) there was no competitive relationship between the dumped imports 
and the domestic like product,  such that their prices were not comparable.527 The Panel found that 
the KTC acted inconsistently with Articles  3.1 and 3.5 on the basis of the second and third grounds 
advanced by Japan.528 Korea challenges these findings on appeal , which we consider in section 
5.3.4.1.4  below.  
5.206.   As for diver ging price trends, the Panel rejected Japan's arguments.529 Japan appeals the 
Panel's findings and contend s that the Panel: (i)  "incorrectly viewed its findings about diverging price 
trends in isolation of its other findings about price comparability and pri ce overselling"; and (ii) 
"incorrectly accepted allegations about the alleged fierce competition".530 Japan avers that "[r]ather 
than considering the diverging price trends 'in themselves'", the Panel should have considered "the 
diverging price trends in the  context of the lack of price comparability and the persistent and 
significant price overselling".531  
5.207.   In response, Korea submits that Japan's claim of legal error is unclear.532 Korea avers that 
Japan does not take issue with the price -related findings that w ere in its favour but considers 
that: (i) "the Panel looked at other price -related issues in isolation, 'ignored its own findings', and 
thus essentially contradicted itself"; (ii) "the Panel 'never explained' how allegedly isolated examples 
demonstrated th at all like products were in competition"; (iii) "the Panel never put its allegedly 
isolated examples in 'context'"; and (iv) "it is 'not an objective examination' of the Panel to consider 
facts in isolation."533 Korea submits that "[a]ll of this appears to be more of an Article  11 DSU claim 
than a claim of legal error."534 
5.208.   Before the Panel, Japan argued that the prices of the dumped imports and that of the 
domestic like product diverged over the period of trend analysis, both on the basis of average sales 
price and on the basis of the price fluctuation index.535 The Panel, therefore, understood Japan to 
assert that "these diverging price trends show [ed] that there was no market interaction between 
the dumped imports and the domestic like product", thus "undermini ng the KTC's price suppression 
and depression analyses, which in turn formed the basis of the ultimate determination under 
Article  3.5".536 The Panel noted that the prices of the dumped imports and the domestic like product 
moved in generally the same direct ion from 2010 to 2011. However, from 2011 to 2012, the average 
price of dumped imports increased , while that of the domestic like product decreased.537 The Panel 
recognized that "[a]n increase in the price of the dumped imports might be expected to be 
accomp anied by an increase in domestic prices ."538 The Panel therefore considered that, in such a 
situation, it was expected of a reasonable investigating authority to explain why, nonetheless, it 
considers that the dumped imports affect the prices of domestic lik e product.539 The Panel found 
that the KTC provided explanation in this regard.540 The Panel further noted that, from 2012 to 2013, 
                                                
527 Panel  Report, para.  7.259.  
528 Panel Report, para.  7.323.  
529 Panel  Report, para.  7.296.  
530 Japan's appellant's submission, para.  283. 
531 Japan's appellant's submission, para.  284. 
532 Korea's appellee's submission, para.  439. 
533 Korea's appellee's submission, para.  439. (fns  omitted)  
534 Korea's appellee's submission, para.  439. 
535 Panel  Report, para.  7.273.  
536 Panel  Report, para.  7.273.  
537 Panel  Report, para.  7.277.  
538 Panel  Report, para.  7.279. 
539 Panel  Report, para.  7.279.  
540 Panel  Report, para.  7.279. The Panel found that "the OTI attributed the increase in the dumped 
import prices to changes in the product mix of the dumped imports to higher -priced valves in the context of 
the divergence fr om 2011 to 2012." (Ibid.) The Panel noted that in certain product groups, "the prices of the 
dumped imports stagnated or decreased, in line with the price trends of the corresponding domestic like 
products." (Ibid., para.  7.295.a)  
 WT/DS504/AB/R  
 
- 71 - 
 
  the average prices of both dumped imports and domestic like product declined, with average import 
prices declining to a greater extent.541 In this respect, the Panel found that the difference in the 
decline " in itself  [did] not demonstrate that the KTC erred in considering that the dumped imports 
and the domestic like products competed with each other".542 Rather, the Panel found the KTC's 
explanation that the prices of the domestic industry were already at unsustainably low levels not to 
be unreasonable.543  
5.209.   As we see it, the Panel's analysis here focused on whether there was a competitive 
relationship betwe en dumped imports and domestic like product despite diverging price trends, and 
whether the diverging price trends could, in and of themselves, undermine the causal relationship.  
We find this evident from the manner in which the Panel drew its conclusions concerning the 
diverging trends in the average prices of dumped imports and the domestic like product when it 
found that: (i) the different magnitude of the price decreases from 2012 to 2013 does not necessarily 
undermine the KTC's findings with respect to  the competitive relationship  between the dumped 
imports and the domestic like product544; (ii) the opposing price movements from 2011 to 2012 
could suggest a lack of competition  between the dumped imports and the domestic like product , and 
the KTC did not d isregard this possibility in its analysis545; and (iii) the verified instances in which 
the dumped imports were sold at prices lower than those of the domestic like product support the 
view that there was competition  in the Korean market for valves.546 The Pan el further explained that 
"[i]f there is evidence in the record which may call into question the nature and extent of the 
competitive relationship between dumped imports and the domestic like product, an investigating 
authority cannot disregard such eviden ce in considering the effect of dumped imports on prices ."547  
5.210.   Thus, the Panel's above analysis reviewed the Korean investigating authorities' examination 
of the relationship between the prices of the dumped imports and those of the domestic like product s, 
in order to ascertain the effects of the former on the latter. In our view, this corresponds to an 
examination properly conducted pursuant to Article  3.2, second sentence. The Panel's conclusion 
that the diverging price trends do not, in and of themselves, demonstrate that the KTC's 
determination of a causal relationship is inconsistent with Articles  3.1 and 3.5 was a mere 
consequence of its analysis as to whether the KTC's price -effects analyses were objective and 
reasoned, and compatible with the requireme nts set out in Article  3.2, second sentence. This, in our 
view, is further borne out from the manner in which the Panel addressed Korea's argument that the 
verified instances in which the dumped imports were offered to customers at prices similar to , or 
lower than , the prices of the domestic like product demonstrate "market interaction" between the 
dumped imports and the domestic like product.548 In that context, the Panel found that the evidence 
of lower prices of imported products in sales of certain models  or to certain customers, while in itself 
not determinative, did support the conclusion that there was competition between dumped imports 
and the domestic like product in the Korean market for valves, and " which in turn lends support to 
the KTC's price sup pression and depression findings ".549 We note that the Korean investigating 
authorities' findings on the price-suppressing and -depressing  effects of the dumped imports formed 
one of the bas es for their  ultimate determination of causation. However, the Panel's analysis of the 
issue of diverging price trends, in our view, was based on the applicable requirements under 
Article  3.2, rather than those concerning causation under Article  3.5, even though it wa s addressing 
a claim under Article  3.5. In so doing, the Panel effectively incorporated the requirements of 
Article  3.2, rather than applying properly the requirements set out in Article  3.5, when addressing 
Japan's causation claim under this provision . For these reasons, we find the Panel to have erred in 
its application of Article  3.5 of the Anti -Dumping Agreement . 
5.211.    This does not mean, however, that we consider Japan to have demonstrated that the KTC's 
examination of the diverging price trends necessarily  rendered its causation determination 
inconsistent with Articles  3.1 and 3.5 of the Anti -Dumping Agreement . Rather, apart from arguing 
that the Panel's review of the KTC's examination of diverging price trends was not properly done, 
                                                
541 Panel  Report, para.  7.277. 
542 Panel  Report, para.  7.278. (emphasis original)  
543 Panel  Report, para.  7.278 (referring to KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)) , p. 18). 
544 Panel  Report, para.  7.295.a.  
545 Panel  Report, para.  7.295.a.  
546 Panel  Report, para.  7.295.c.  
547 Panel  Report, para.  7.275. (emphasis added)  
548 Panel  Report, para.  7.291.  
549 Panel  Report, para.  7.294. (emphasis added)  
 WT/DS504/AB/R  
 
- 72 - 
 
  Japan has not demonstra ted why the KTC's examination contains flaws that vitiate its causation 
determination pursuant to the requirements set out in Articles  3.1 and 3.5 .  
5.212.   Specifically, contrary to Japan's argument550, the Panel, at this stage of its analysis, did not 
come to a co nclusion on how dumped imports affected domestic like product prices for the entire 
period of trend analysis. Rather, the Panel proceeded step by step, examining the trend in each year 
of the POI and the KTC's relevant explanation. Furthermore, the Panel o bserved that "[t]he KTC 
based its price suppression and depression findings in part on the 'fierce' competition between 
certain dumped imports and the domestic like product", evidenced by "SMC Korea's alleged price 
discrimination among different customers" .551 Japan submits that, in making this observation, the 
Panel never explained "how these isolated examples demonstrated that all domestic like products 
are in competition with the dumped imports" and thus "met the legal standard 
under  either  Article  3.2 or Article  3.5 to assess the effects of imports on the domestic like product 
as a whole".552 However, while the Panel found that evidence of the alleged price discrimination 
supported the conclusion that there was competition between dumped imports and domestic  like 
products, the Panel, importantly, acknowledged that it was not in itself determinative. Rather, the 
Panel noted that such evidence "lends support" to the KTC's findings of price suppression and price 
depression.  
5.213.   Moreover, the Panel found that "[t]he KTC's price suppression and depression findings 
were not solely … based on a consideration of average price trends ", but also on "the alleged price 
discrimination among different customers with respect to specific prod ucts or product ranges, and 
the strengthened marketing activities of SMC Korea" .553 Thus, the Panel considered and analysed 
how isolated instances of lower priced sales affected the domestic like product prices as a whole. By 
arguing  that "the Panel ignores the legal obligation to consider the effects on the prices of the 
domestic like product as a whole"554, Japan  attempts to view the Panel's assessment of its arguments 
regarding diverging price trends in isolation. The Panel's above analysis of the KTC's cons ideration 
of the diverging price trends reflects , in our view,  a proper review pursuant to the requirements 
under Article  3.2. Therefore, we see no reason to disagree with such analysis in light of the applicable 
requirements under Article  3.2. However, in so doing, the Panel effectively incorporated the 
requirements of Article  3.2, rather than properly applying the requirements set out in Article  3.5, 
even though it was reviewing a claim under Article  3.5. We therefore consider the Panel to have 
erred in i ts application of Article  3.5 of the Anti -Dumping Agreement .  
5.3.4.1.2.3   Whether the Panel failed to consider impact as an essential building block for 
any finding of causation  
5.214.   On appeal, Japan argues that the Panel's conclusion that the KTC need not establish a link  
between volume and price effects under Article  3.2 and the impact of the dumped imports on the 
domestic industry under Article  3.4 is wrong, and that the failure to establish this logical link 
"undermine[d]" the KTC's causation finding.555 Japan asserts that the Panel rejected Japan's 
argument by focusing too narrowly on the requirements of Article  3.2 of the Anti -Dumping 
Agreement  concerning volume and price and on Article  3.4 of the Anti -Dumping Agreement  
regarding impact, and not on the proper analysis under Article  3.5 regarding causation.556 
5.215.   Korea, in response, submits that this claim is "undeveloped" and "without merit" in light of 
the Panel's clear findings.557 Korea contends that Japan does not explain what the Panel was required 
to eval uate other than to examine whether the authorities evaluated the impact in line with 
                                                
550 Japan contends that the legal standard is not whether the investigating authority has provided some 
explanation that is "not unreasonable" w hen viewed in isolation. (Japan's appellant's submission, para.  284) 
Rather, according to Japan, "the legal standard is whether the authority has reasonably explained why 'it 
considers that the dumped imports affect domestic like product prices .'" (Japan's  appellant's submission, 
para. 284 (quoting Panel  Report, para.  7.276) (emphasis added))  
551 Panel  Report, para.  7.294.  
552 Japan's appellant's submission, para.  286. (italics original; underlining added)  
553 Panel  Report, para.  7.295.d. (emphasis added)  
554 Japan 's appellant's submission, para.  283. 
555 Japan's appellant's submission, para.  293 (referring to Panel  Report, paras.  7.330 and 7.347.b).  
556 Japan's appellant's submission, para.  289. 
557 Korea's appellee's submission, para.  441 (referring to Panel Report, paras.  7.329 -7.330).  
 WT/DS504/AB/R  
 
- 73 - 
 
  Article  3.4, or what a "proper" analysis would consist of.558 Instead, Korea points out that the Panel 
made findings "which follow[ed] established WTO jurisprudence" inasmuc h as the Panel explained 
that "the 'logical progression of inquiry' does not mean that the examination of impact under 
Article  3.4 must be linked to the consideration under Article  3.2", but rather, "[t]hese two separate 
inquiries can be undertaken indepen dently of each other, and brought together in the ultimate 
determination under Article  3.5."559 
5.216.   We recall that the Panel here was considering Japan's claim 6 under Articles  3.1 and 3.5 of 
the Anti-Dumping  Agreement. Japan's claim rested on its argument that the KTC's failure to establish 
a "logical link" between its evaluation of certain factors having a bearing on the state of the domestic 
industry and its consideration of the volume of the dumped imports and the effect of the dumped 
imports on prices under Article  3.2 for the purposes of its impact analysis under Article  3.4 rendered 
its causation analysis inconsistent with Article  3.5. The Panel explained that, "[w]hile there may be 
some overlap between the consideration of the effect of the dumped imports on domestic prices 
under the second sentence of Article  3.2 and the evaluation of 'factors affecting domestic prices' 
under Article  3.4", this does not mean that, as Japan seems to suggest, "a flawed price effects 
analysis will necessarily preclude a prope r examination of the impact of the dumped imports on the 
domestic industry under Article  3.4."560 The Panel also rejected Japan's argument that, by failing to 
examine two factors set out in Article  3.4, the Korean investigating authorities acted inconsistent ly 
with Article  3.5.561 According to the Panel, since it had rejected the same argument with respect to 
the separate claim raised by Japan under Article  3.4, "[f]or the reasons set forth in that section", 
the Panel also rejected this argument under Article  3.5.562 
5.217.   We agree with th e Panel that , "in order to properly examine the impact of dumped imports 
on the domestic industry for purposes of Article  3.4, an investigating authority [is not required to ] 
link that examination with its consideration of the volume and the price effects of the dumped 
imports."563 However, the Panel's analysis rejecting Japan's position described above is ultimately 
based on its understanding of the relationship between the inquiries contemplated under Articles  3.2 
and 3.4.564 Similarly, we do not see any reas on to disagree with the Panel's finding that "there is no 
need 'to undertake a fully reasoned causation and non -attribution analysis' as part of Article  3.4."565 
Rather, the demonstration that subject imports are causing injury to the domestic industry "is an 
analysis specifically mandated by Article  3.5".566 Thus, we do not consider Japan to have 
demonstrated an "independent" violation of Article 3.5 of the Anti -Dumping  Agreement on the basis 
of its arguments that the Panel rejected. Nonetheless, the Panel's a bove analyses, including its 
reliance on the findings it made with respect to the separate claim raised under Article  3.4, further 
indicate that the Panel reviewed Japan's arguments in light of the requirement set out in Article  3.4 
even though it was addr essing a causation claim under Article  3.5. Thus, as we see it, the Panel's 
examination of the alleged flaws in the Korean investigating authorities' impact analysis primarily 
relates to the issue of whether the KTC's impact examination was in line with th e requirements set 
out in Article  3.4, as opposed to those under Article  3.5, which, as we have explained above, does 
not foresee a panel revisiting the question whether an investigating authority's impact analysis is 
consistent with Article  3.4. In so doi ng, the Panel effectively incorporated the requirements of 
Article  3.4, rather than properly applying the requirements set out in Article  3.5, even though it was 
reviewing a claim under Article  3.5. We therefore consider the Panel to have erred in applying 
Article  3.5 of the Anti -Dumping Agreement .  
                                                
558 Korea's appellee's submission, para.  440. 
559 Korea's appellee's submission, para.  441 (quoting Panel  Report, para.  7.329).  
560 Panel  Report, fn  456 to para.  7.329.  
561 Panel  Report, para.  7.325.  
562 Panel  Report, para.  7.325.  
563 Panel  Report, para.  7.330 (emphasis added).  
564 Panel  Report, para.  7.330. The P anel also addressed Japan's arguments concerning the KTC's alleged 
failure to demonstrate explanatory force of the dumped imports on the state of the domestic industry and to 
properly take into account "positive" trends such that these considerations "disp roved" the existence of causal 
link between the dumped imports and injury to the domestic industry. However, the Panel rejected these 
arguments. (Ibid., paras.  7.338 -7.346) Japan has not challenged these findings on appeal in the context of its 
"independen t" causation claim.  
565 Japan's appellant's submission, para.  290 (quoting Panel  Report, para.  7.332)  
566 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para. 5.205 (referring to 
Appellate  Body Report, China – GOES , para.  150).  
 WT/DS504/AB/R  
 
- 74 - 
 
  5.3.4.1.3   Whether the Panel erred under Article  11 of the DSU and Article  17.6 of the 
Anti-Dumping  Agreement by failing to consider Japan's rebuttal arguments on the issue 
of "reasonable sales price"  
5.218.   On appeal, Japan contends that, "in accepting the KTC['s] explanation for the diverging price 
trends based on the constraints imposed by the so -called 'reasonable sales price', the Panel ignored 
Japan's rebuttal arg uments about this issue."567 Japan explains that "this issue became relevant 
when Korea used the 'reasonable sales price' affirmatively to justify the causation finding of its 
anti-dumping measure."568 In Japan's view, "[o]nce Korea offered this proposed defen se, Japan 
challenged this defense at length and the Panel had an obligation under the standard of review to 
address Japan's rebuttal."569 According to Japan, the legal standard is the same under both Article  11 
of the DSU and Article  17.6 of the Anti -Dumping  Agreement, and therefore the Panel ought to have 
considered alternative explanations.570 
5.219.   In response, Korea submits that "Japan does not actually quote any of the Panel's findings 
it considers to have been the result of a biased examination."571 Korea submits  that Japan makes a 
very serious accusation of bias by the Panel, based solely on the fact that the Panel did not deal with 
a rebuttal argument by Japan.572 Korea states that "it is not sufficient under Article  11 [of the] DSU 
to claim that a certain argumen t was not addressed; let alone that it would be sufficient to claim 
that a Panel was biased simply because it allegedly did not address a 'rebuttal' argument."573 
Therefore, Korea submits that Japan has failed to demonstrate that the alleged disregard of thi s 
rebuttal argument constituted an egregious error that calls into question the good faith of the 
Panel.574 Korea also points out that "the reason why the Panel did not address this argument is 
because Japan never made it in the context of its allegedly 'ind ependent' causation claim."575 
5.220.   We recall that, under Article  11 of the DSU, a panel is required to consider all the evidence 
presented to it, assess the credibility  of such evidence , determine the weight  there of, and ensure 
that the panel's factual findings have a proper basis in that evidence.576 Within these parameters, 
"it is generally within the discretion of the [p]anel to decide which evidence it chooses to utilize in 
making findings."577 A claim that a panel has failed to conduct an "objective assessment o f the 
matter before it" is "a very serious allegation".578 In a claim under Article  11 of the DSU, an appellant 
must identify specific errors579 that are so material that, "taken together or singly"580, they 
undermine the objectivity of the panel's assessment of the matter before it.581 
5.221.   In addition to Article  11 of the DSU, a panel reviewing a domestic authority's investigations 
under the Anti -Dumping  Agreement is also subject to the standard of review set out in Article  17.6 
of that  Agreement. With re spect to a panel's assessment of facts, "[t]he aim of Article  17.6(i) is to 
prevent a panel from 'second -guessing' a determination of a national authority when the 
establishment of the facts is proper and the evaluation of those facts is unbiased and objec tive."582 
Accordingly, "the task of a WTO panel is to examine whether the investigating authority has 
                                                
567 Japan 's appellant's submission, para.  295 (referring to Panel  Report, para.  7.278; Japan's first 
written submission to the Panel, paras.  97-99; second written submission to the Panel, para.  53). 
568 Japan's appellant's submission, para.  295. (fn  omitted)  
569 Japan' s appellant's submission, para.  295 (referring to Japan's second written submission to the 
Panel, paras.  51-58; response to Panel question No. 98, paras.  48-51). 
570 Japan's appellant's submission, para.  294. 
571 Korea's appellee's submission, para.  447. 
572 Korea's appellee's submission, para.  447. 
573 Korea's appellee's submission, para.  447. 
574 Korea's appellee's submission, para.  447. 
575 Korea's appellee's submission, para.  447 (referring to Panel Report, para.  7.227).  
576 Appellate  Body Reports, China – Rare Earth s, para.  5.178 (quoting Appellate  Body Report, 
Brazil  – Retreaded Tyres , para.  185).  
577 Appellate  Body Reports, US – COOL , para.  299 (quoting Appellate  Body Report, EC – Hormones , 
para. 135).  
578 Appellate  Body Reports, China – Rare Earths , para.  5.227 (quoti ng Appellate  Body Report, 
EC – Poultry , para.  133).  
579 Appellate  Body Report, EC – Fasteners (China) , para.  442. 
580 Appellate  Body Report, EC and certain member States – Large Civil Aircraft , para.  1318.  
581 Appellate  Body Reports, China – Rare Earths , para.  5.179. See also Appellate  Body Report, 
EC – Fasteners (China) , para.  499. 
582 Appellate  Body Report, Thailand – H-Beams , para.  117. 
 WT/DS504/AB/R  
 
- 75 - 
 
  adequately performed its investigative function, and has adequately explained how the evidence 
supports its conclusions."583 However, "in light of the standar d of review under the 
Anti-Dumping  Agreement, … it is not for a panel to conduct a de novo review of the facts of the case 
or substitute its judgement for that of the investigating authority."584 Rather, "a panel must examine 
'whether, in the light of the ev idence on the record, the conclusions reached by the investigating 
authority are reasoned and adequate'."585 
5.222.   We note that, in connection with Japan's claim under Articles  3.1 and 3.2 of the 
Anti-Dumping  Agreement with respect to price effects, the Panel note d that "[t]he 'reasonable sales 
price' is a target domestic industry price constructed by the OTI ."586 The Panel noted that " the OTI 
appended two explanatory notes regarding the calculation of the reasonable sales price to the table 
reporting comparisons bet ween the actual price and the reasonable sales price ."587 The explanatory 
note that does not contain BCI states:  
Note 1) Reasonable sales price = (manufacturing cost per unit + SG&A expenses per 
unit)/(1 -reasonable operating profit ratio)[.]588 
5.223.   The Panel further noted that "[i] n considering price suppression, the KTC referred to the 
difference between the 'reasonable sales price' and the actual average domestic prices in the Final 
Resolution."589 However, because the Panel found that Japan's claim under Articles  3.1 and 3.2 of 
the Anti -Dumping Agreement  with respect to price effects was outside its terms of reference, it did 
not address Japan's argument that "[t] he Korean [investigating] authoritie s never explained why 
the profit margins selected [to construct the reasonable sales price] were in fact a reasonable proxy 
for the prices that the Korean producers should have been able to charge as 'reasonable sales 
prices'."590  
5.224.   According to Japan, "[e]ve n if … [it]  did not focus on the 'reasonable sales price ' as part of 
its original argument about causation " under its "independent" claim under Articles  3.1 and  3.5, "this 
issue became relevant when Korea used the 'reasonable sales price' affirmatively to justify the 
causation finding of its anti -dumping measure."591 In support, Japan refers to paragraph 7.278 of 
the Panel  Report , but, as Korea correctly points out, "in that paragraph there is no discussion on the 
use of 'reasonable sales price'."592 Rather, in  that paragraph, the Panel compared the actual average 
prices of dumped imports with th ose of domestic like products from 2010 to 2013, focusing, in 
particular, on 2013. Therefore, we are unable to see the error in the Panel's analysis that Japan is 
alludi ng to, especially when Japan did not make any arguments concerning the "reasonable sales 
price" or explain its relevance in that context and in the overall context of its "independent" causation 
claim.  
5.225.   Similarly, Japan contends that, although the Korean i nvestigating authorities "described the 
formula being used, they never explained the basis for choosing the benchmark 'reasonable 
operating profit rate'".593 In support, Japan refers to paragraphs 7.475 and 7.477 of the 
Panel  Report . These paragraphs, howeve r, contain the description of the " Relevant facts" underlying 
Japan's claim concerning disclosure of essential facts pursuant to Article  6.9 of the 
Anti-Dumping  Agreement, as opposed to facts relating to Japan's claim 6 under Articles  3.1 and 3.5 
of the An ti-Dumping  Agreement. We thus fail to see how the facts described in the paragraphs 
referenced by Japan relate to the objectivity of the Panel's assessment  of Japan's "independent" 
                                                
583 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.255.  
584 Appellate  Body Report, Russia – Commercial Vehicles , para.  5.102 (referring to Appellate  Body 
Reports, US – Washing Machines , para.  5.258; US – Steel Safeguards , para.  299; Argentina – Footwear (EC) , 
para. 121; US – Anti-Dumping and Countervailing Duties (China) , para.  379).  
585 Appellate  Body Report, Russia – Commercial Vehicles , para.  5.102 (quoting Appellate  Body Report, 
US – Washing Machines , para.  5.258, in turn quoting Appellate  Body Report, US ‒ Softwood Lumber VI 
(Article  21.5 – Canada) , para.  93). 
586 Panel  Report, para.  7.116.  
587 Panel Report, para.  7.116.  
588 Panel  Report, para.  7.116 (quoting OTI's Final Report (Panel Exhibit KOR -2b (BCI)), p.  57). 
589 Panel  Report, para.  7.117.  
590 Japan's appellant's submission, para.  296. 
591 Japan's appellant's submission, para.  295. 
592 Korea's appellee's submission, para.  447. 
593 Japan's appellant's submission, para.  296 (referring to Panel  Report, paras.  7.475 and 7.477).  
 WT/DS504/AB/R  
 
- 76 - 
 
  causation claim such that the Panel could be said to have erred under Article  11 of the DSU and 
Article  17.6(i) of the Anti -Dumping  Agreement.  
5.226.   For these reasons , we reject  Japan's claim that the Panel failed to "respect the proper  
standard of review" and acted inconsistently with Article  11 of the DSU and Article  17.6(i) of the 
Anti-Dumping  Agreement.594  
5.227.   We now turn to address the claims raised by Korea in its other appeal concerning the Panel's 
findings on price comparability and o verselling in the context of Japan's "independent" causation 
claim.  
5.3.4.1.4   Whether the Panel erred in its findings concerning price comparability and 
overselling when addressing Japan's claim 6 under Articles  3.1 and 3.5 of the 
Anti-Dumping  Agreement  
5.228.   To recall, J apan advanced three grounds in support of its claim that the KTC's analysis of 
the price effects of dumped imports "independently" undermined its causation determination under 
Article  3.5 because: (i)  there was a divergence between the trends in prices of dumped import s and 
domestic like product; (ii) dumped imports consistently and significantly oversold the domestic like 
product; and (iii) there was no competitive relationship between the dumped imports and the 
domestic like product,  such that their price s were not comparable.595 In section 5.3.4.1.2.2  above, 
we have reviewed Japan's appeal of the Panel's findings regarding the first ground.  
5.229.   With respect to the third ground, concerning price comparability, in the context of the 
transaction -to-average compar isons, the Panel noted that the KTC found price suppression and price 
depression based, inter alia, on individual transactions in which certain models of the dumped 
imports sold or offered to certain customers were priced lower than the average price of a 
corresponding model of the domestic like product.596 The Panel considered that, in light of the 
possible effect on the comparisons made, an unbiased and reasonable investigating authority could 
not have properly compared these individual transaction prices w ith the average domestic like 
product price of a corresponding model without further consideration and explanation of the 
relevance or significance of the different time periods and quantities involved in these 
transactions.597 The Panel noted that the KTC r elied on the price differentials in these comparisons 
in finding that dumped imports had price-suppressing and -depressing effects on domestic prices, 
which in turn was one of the bases for its ultimate determination under Article  3.5.598 The Panel 
concluded that the KTC acted inconsistently with Articles  3.1 and 3.5 of the 
Anti-Dumping  Agreement by failing to ensure price comparability.599 
5.230.   With respect to the second ground, regarding price overselling, the Panel considered that 
"whether the fact of consistent average price overselling demonstrates that the KTC's determination 
of causation was inconsistent with Articles  3.1 and 3.5 cannot be separated from a consideration of 
whether the KTC's overall analysis of price effects is reasonable, in light of the consistent average 
price overselling by the dumped imports ."600 The Panel considered that, w hile individual instances 
of "underselling" by dumped imports may indeed indicate price -suppressing or -depressing effects 
on the domestic like product prices as a whole, it questioned whether the KTC's analysis was 
sufficiently "robust to support its conclusions".601 In particular, t he Panel found that it was not clear 
that the KTC considered  whether , and if so how, the individual instances of "underselling"  with 
respect to certain models affected "the prices of other models of the domestic like product, the 
extent of total domestic s ales affected by such 'underselling', or how these instances of ' underselling'  
                                                
594 Japan's appellant's subm ission, para.  297. 
595 Panel  Report, para.  7.259.  
596 Panel  Report, para.  7.270 (referring to KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)) , p. 19). 
597 Panel  Report, para.  7.271.  
598 Panel  Report, para.  7.272.  
599 Panel  Report, para.  7.272.  
600 Panel  Report, pa ra. 7.301. (emphasis original)  
601 Panel  Report, para.  7.303.  
 WT/DS504/AB/R  
 
- 77 - 
 
  affected domestic like product prices as a whole".602 The Panel also considered that examples or 
isolated instances of aggressive pricing behaviour will not, standing alone, suffi ce to support a finding 
of price -suppressing and -depressing effects of dumped imports on domestic like product prices as 
a whole.603  
5.231.   As we see it, the Panel's findings with respect to the issues of price comparability and price 
overselling are closely link ed, inasmuch as the KTC relied on the relevant price comparisons to find 
price effects on the domestic like product as a whole, while dismissing the argument concerning the 
consistent overselling by the dumped imports. Indeed, as noted by the Panel, "[t]he  KTC rejected 
this argument because, in its view, the average price overselling was the result of the differential 
pricing of dumped imports for different models or options and to different customers."604 Instead, 
"the KTC focused on: (a) the lower prices of  certain [imported] products to certain customers; and 
(b) the 'strengthened marketing activities' of the related importer SMC Korea as the two bases of its 
finding on price effects."605 Ultimately, the Panel found that the KTC acted inconsistently with 
Articles 3.1 and 3.5 because: (i) the KTC failed to ensure price comparability in the transaction -to-
average comparisons due to the different time periods and quantities involved606; and (ii) the KTC 
failed to explain how and why a subset of transactions for certain models was sufficient to establish 
price effects for the domestic like product as a whole , notwithstanding the consistent average price 
overselling by the dumped imports.607 
5.232.   On appeal, Korea advances two main grounds, claiming that: (i) the Panel relieved Japan of 
its burden to demonstrate that the KTC failed to ensure price comparability and , instead, made the 
case for Japan608; and (ii) the Panel imposed a price comparison requirement not found in Article  3.5 
of the Anti -Dumping  Agree ment and that is more demanding than the standard under Article  3.2 of 
the Anti -Dumping  Agreement.609  
5.233.   Korea's arguments thus centre on the issue of price comparability and call upon us to first 
examine the relevance of price comparability in the context of an investigating authority's injury 
determination under Article  3 of the Anti -Dumping Agreement . We recall that Article  3.1 provides 
that a determination of injury shall be based on positive evidence and involve an objective 
examination of "the effect of t he dumped imports on prices in the domestic market for like 
products ".610 Article  3.2, second sentence, lists three price effects that are distinct from each other, 
in that, even if prices of the dumped imports do not significantly undercut those of the dome stic like 
products, such imports may nevertheless have a price-suppressing  or -depressing effect on domestic 
prices.611 Article  3.2, second sentence, as the Panel also noted612, does not, however, prescribe 
specific methodologies as to how an investigating aut hority is to consider whether there has been a 
significant price undercutting, price suppression, or price depression. Under Article  3.2, second 
sentence, an investigating authority therefore has a measure of discretion in how it chooses to 
assess price ef fects. The Appellate  Body found, however, that "a failure to ensure price 
comparability" could not be considered to be consistent with the requirement under Article  3.1 that 
"a determination of injury be based on 'positive evidence' and involve an 'objecti ve examination' of, 
inter alia , the effect of subject imports on the prices of domestic like products".613 Thus, "if subject 
import and domestic prices were not comparable, this would defeat the explanatory force that 
subject import prices might have for the  depression or suppression of domestic prices."614 For this 
                                                
602 Panel  Report, para.  7.303. The Panel recalled that WTO panels have considered that "a  finding of 
price depression in a situation where dumped imports oversell the domestic like product requires an 
explanation of how the investigating authorities reached a conclusion of price depression in such a situation." 
(Ibid., fn  420 to para.  7.303 (referring to Panel  Reports, China – Autos (US) , para.  7.272;  China  – Cellulose 
Pulp, para.  7.86))  
603 Panel  Report, para.  7.318.  
604 Panel  Report, para.  7.300.  
605 Panel  Report, para.  7.300. (fn  omitted)  
606 Panel Report, para.  7.272.  
607 Panel Report, para.  7.322.  
608 Korea's other appellant's submission, paras.  197-207. 
609 Korea's other appellant's submission, par as. 208-226. 
610 Emphasis added.  
611 Appellate  Body Report, China – GOES , para.  137. 
612 Panel  Report, para.  7.266.  
613 Appellate  Body Report, China – GOES , para.  200. 
614 Appellate  Body Report, China – GOES , para.  200. (fn  omitted)  
 WT/DS504/AB/R  
 
- 78 - 
 
  reason, the Appellate  Body stated that "[a]s soon as price comparisons are made, price 
comparability necessarily arises as an issue."615  
5.234.   These considerations suggest that, to the extent that an inves tigating authority relies on 
price comparisons in its consideration of price effects of subject imports, price comparability needs 
to be ensured. Thus, where an investigating authority fails to ensure price comparability in price 
comparisons between dumped  imports and the domestic like product, this undermines its findings 
of price effects under Article  3.2, to the extent that it relies on such price comparisons.  
5.235.   With these considerations in mind, we address each of Korea's arguments, starting with 
whether the Panel unduly relieved Japan of its burden of demonstrating that the KTC failed to ensure 
price comparability.  
5.3.4.1.4.1   Whether the Panel erred in law by unduly relieving Japan of its burden of 
demonstrating that the KTC failed to ensure price comparability  
5.236.   Korea submits that the two aspects of the KTC's price -effects analysis that the Panel took 
issue with, namely (i) the KTC's comparison of individual transactio n prices with average sales 
prices; and (ii) the KTC's justification of its price suppression  and price depression finding s in light 
of the average price overselling by the dumped imports, "are different from the question of price 
comparability that was ra ised by Japan and should thus not have been examined by the Panel given 
the lack of  a prima facie  case developed by Japan in this respect".616 Korea recalls that, before the 
Panel, Japan challenged the competitive relationship between the dumped imports and the domestic 
like products, arguing that the two products were not in competition with each other in the Korean 
market for various reasons.617 Korea submits that the Panel rejected Japan's argument that there 
was no competitive relationship between the two p roducts and concluded, "in unequivocal terms, 
that '[t]he verified instances in which the dumped imports were sold at prices lower than those of 
the domestic like product support the view that there was competition in the Korean market for 
valves'" .618 Thus,  Korea submits that, with Japan failing to make its prima facie  case against the 
existence of competition between the dumped imports and the domestic like product, and thus 
against the price comparability between the dumped and domestic products, "the Pane l's analysis 
should have ended right there."619 By continuing to examine the issue of price comparability, Korea 
contends that "[t]he Panel shifted the burden of proof to Korea on a technical point that was not  
developed by Japan."620 
5.237.   Japan, for its part, cont ends that, contrary to Korea's argument, Japan did not limit its 
arguments to the existence of a general competitive relationship between  dumped  imports and the 
domestic like products. Therefore, according to Japan, the Panel correctly noted that Japan had  
stressed the points about price comparability in its arguments.621 Furthermore, Japan argues that 
ensuring price comparability is an essential part of any proper finding of price effects under the 
second sentence of Article  3.2 or of causation under Article  3.5.622 Japan contends that Korea 
misinterprets the obligation of the "effect of dumped imports on prices" under the second sentence 
of Article  3.2, and of a finding of "causing injury" under Article  3.5. Japan avers that the effect of 
dumped imports on dom estic prices, and ultimately the question whether dumped imports are 
"causing injury", can be determined properly only when the investigating authority ensures that the 
prices being analy sed are, in fact, comparable.623 
5.238.   Korea's contentions are based on the p remise that Japan's arguments before the Panel 
concerning price comparability were limited to Japan's view that there was a lack of competitive 
relationship, or substitutability, between the dumped imports and domestic like products. In Korea's 
view, Japan 's arguments do not encompass the issue of comparability between the specific 
transactions on which the Korean investigating authorities relied in reaching their finding of price 
                                                
615 Appellate  Body Report, China – GOES , para.  200 (quoting Panel  Report, China – GOES , para. 7.530).  
616 Korea's other appellant's submission, para.  198. 
617 Korea's other appellant's submission, para.  201 (referring to Panel  Report, para.  7.259).  
618 Korea's othe r appellant's submission, para.  201 (quoting Panel  Report, para.  7.295.c).  
619 Korea's other appellant's submission, para.  202. 
620 Korea's other appellant's submission, para.  198. (emphasis original)  
621 Japan's appellee's submission, para.  94. 
622 Japan's appell ee's submission, para.  93. 
623 Japan's appellee's submission, para.  93. 
 WT/DS504/AB/R  
 
- 79 - 
 
  suppression and price depression, which in turn was one of the bases for finding causation. However, 
the Panel, as we recall, noted Japan's argument that, in its price-effects analysis , the KTC failed to 
ensure price comparability between specific products or product segments o f the dumped imports 
and the domestic like product.624 The Panel specifically noted Japan's contention that "the KTC ' failed 
to consider the comparability of products it used to reach its conclusions of price depression and 
suppression , and equally failed to  conduct an objective examination of the overall extent of price 
competition between subject imports and domestic products '."625 Although  Japan used the term 
"comparability of products", Japan also alluded to the KTC's failure to conduct an objective 
examina tion of the overall extent of price competition. For example, Japan contended before the 
Panel that the KTC never explained in its reports how the conclusions of price suppression and price 
depression  were supported by the comparison between the prices of subject imports and the 
"high-end prices" of domestic like products.626 In so doing, Japan, in our view, made out a prima 
facie case regarding the requirement on the KTC to ensure price comparability in its price -effects 
analysis under Article  3.2, second se ntence. T he Panel's understanding of Japan's arguments is thus 
well founded in view of the applicable requirements under Article  3.2, second sentence , which 
concerns price effects of dumped imports on the domestic like product .  
5.239.   Moreover, we note that it i s undisputed that "the KTC undertook price comparisons ."627 In its 
price suppression and price depression analyses, the KTC compared, inter alia , individual resale 
transaction prices of the dumped imports to the average price of the corresponding model of the 
domestic like product, and concluded that the "sales price of the dumped products was much lower 
than the average sales price in the case of certain products or customers for which the degree of 
competition with the domestic indu stry was fierce".628 Ultimately, the KTC relied on the price 
differentials in these comparisons in finding that dumped imports had price -suppressing 
and -depressing effects on domestic prices, which in turn was one of the bases for its ultimate 
determination  of causation under Article  3.5.629 In light of Japan's argument that the KTC failed to 
conduct an objective examination of the overall extent of price competition in reaching its price 
suppression and price depression findings , the Panel correctly considere d that , to the extent an 
investigating authority's consideration of price suppression or price depression may involve 
comparison of prices, the investigating authority must ensure that the prices being compared are 
properly comparable.630 However, the Panel' s above analysis was more directly relevant in the 
context of Article  3.2, second sentence, rather than in that of Article  3.5. In so doing, the Panel 
effectively incorporated the requirements of Article  3.2, rather than applying properly the 
requirements set out in Article  3.5, even though the Panel was reviewing a claim under the latter 
provision . While we consider that the Panel's above findings pertain to a proper application of the 
requirements under Article  3.2, we find that they nonetheless constitut e an error in the application 
of Article  3.5 of the Anti -Dumping Agreement . 
5.3.4.1.4.2   Whether the Panel erred in law by imposing a price comparison requirement 
not contained under either Article  3.2 or Article  3.5 of the Anti -Dumping  Agreement  
5.240.   Korea recalls that Article 3.5 of the Anti -Dumping  Agreement refers to the effects of dumping 
"as set forth in paragraphs 2 and 4". Korea submits that, even assuming arguendo  that this reference 
can be read as importing the obligation that is contained in Article  3.2 of the 
Anti-Dumping  Agreement regarding the effects of the dumped imports on prices, "it cannot be read 
to introduce specific obligations about the method to be used when conducting this price effects 
analysis."631 Korea recalls that, with respect to the KTC's consideration that certain sales of the 
dumped import models took place at prices below the average or high -end prices of the 
corresponding models of the domestic like product, the Panel found that "an unbiase d and 
reasonable investigating authority could not have properly compared these individual transaction 
prices with the average domestic like product price of a corresponding model, without further 
                                                
624 Panel  Report, para.  7.264.  
625 Panel  Report, para.  7.264 (quoting Japan's second written submission to the Panel, para.  17). 
(emphasis added)  
626 Japan's comments on Korea's response to Pa nel question No. 88, para.  33. 
627 Panel  Report, para.  7.267.  
628 Panel  Report, para.  7.267.b (quoting KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)), p.  19). 
629 Panel  Report, para.  7.272.  
630 Panel  Report, para.  7.266.  
631 Korea's other appellant's submission, para.  208. 
 WT/DS504/AB/R  
 
- 80 - 
 
  consideration and explanation of the relevance or significa nce of these differences."632 Korea submits 
that, in the context of an Article  3.2 consideration of the price effects of the dumped imports, "there 
is no basis for requiring such an additional analysis when no price undercutting finding is made."633  
5.241.   In respon se, Japan submits that the Panel properly applied the requirements of Articles  3.1 
and 3.5 of the Anti -Dumping  Agreement, and faulted the KTC for failing to recognize the extent to 
which the evidence of pervasive overselling of the domestic like product as  a whole fatally 
undermined the KTC 's finding of causation.634 Japan submits that Korea's argument "misunderstands 
the obligations under Articles  3.1 and 3.5 and their relationship to the 'price effects' analysis required 
by Article  3.2".635 Japan contends tha t the Panel correctly focused on the need to base conclusions 
about price suppression and price depression on the prices of the domestic like product as a whole.636 
Japan submits that the KTC noted the price overselling but, contrary to Korea's assertions, i gnored 
the consistency and the significance of the overselling and did not discuss at all the implications of 
this fact for its analysis of price suppression.637 Japan explains that the KTC failed to discuss the 
implications of these key facts.638 Consequently , the KTC failed to explain how the subject imports 
had any explanatory power for the alleged suppression of the domestic prices.639 Thus, Japan 
submits that these failures seriously undermined the KTC's conclusions about price suppression and , 
ultimately , about causation.640 
5.242.   As noted, Korea's arguments centre on the issue of price comparability in the context of an 
injury determination under Article  3 of the Anti -Dumping  Agreement. Korea's arguments rest on the 
premise that there is no obligation under Article  3.2 to ensure price comparability, so long as an 
investigating authority does not make a finding of price undercutting. We have explained above that 
Article  3.2, second sentence, lists three price effects that are distinct from each other, in that, even 
if prices of the dumped imports do not significantly undercut those of the domestic like products, 
such imports may nevertheless have price -suppressing or -depressing effect s on domestic prices.641 
We have also recalled the Appellate  Body's finding that "a fa ilure to ensure price comparability" 
cannot be considered to be consistent with the requirement under Article  3.1 that "a determination 
of injury be based on 'positive evidence' and involve an 'objective examination' of, inter alia , the 
effect of subject i mports on the prices of domestic like products".642 Thus, as the Appellate  Body 
stated , "[a]s soon as price comparisons are made, price comparability necessarily arises as an 
issue."643 Accordingly, we have noted that, to the extent an investigating authority relies on price 
comparison in its consideration of price effects of dumped imports, price comparability needs to be 
ensured. Thus, where an investigating authority fails to ensure p rice comparability in undertaking 
price comparisons between dumped imports and the domestic like product, this would undermine 
its finding of price suppression or depression under Article  3.2, to the extent that it relies on such 
price comparisons and not only when a finding of price undercutting is made, as Korea suggests.  
5.243.   In the present dispute, the Panel's findings challenged by Korea relate to the KTC's findings 
of price suppression and price depression pursuant to Article  3.2, second sentence. The Pan el, as 
we recall, described the context in which the KTC relied on the transaction -to-average price 
underselling analysis and the "strengthened marketing activities" as  follows : 
In the present case, interested parties argued during the domestic investigati on that 
the fact that average dumped import prices were higher than those of the domestic like 
product throughout the period of trend analysis precluded a finding of price suppression 
or price depression. The KTC rejected this argument because, in its view , the average 
price overselling was the result of the differential pricing of dumped imports for different 
models or options and to different customers. Instead, the KTC focused on: (a) the 
                                                
632 Korea's other appellant's submission, para.  215 (referring to Panel  Report, para.  7.271).  
633 Korea's other appellant's submission, para.  215. 
634 Japan's appellee's submission, para.  106. 
635 Japan's appellee' s submission, para.  106. 
636 Japan's appellee's submission, para.  101. 
637 Japan's appellee's submission, para.  113. 
638 Japan's appellee's submission, para.  113. 
639 Japan's appellee's submission, para.  113. 
640 Japan's appellee's submission, para.  113. 
641 Appellate  Body Report, China – GOES , para.  137. 
642 Appellate  Body Report, China – GOES , para.  200. 
643 Appellate  Body Report, China – GOES , para.  200 (quoting Panel  Report, China – GOES , para. 7.530).  
 WT/DS504/AB/R  
 
- 81 - 
 
  lower prices of certain products to certain customers; and (b)  the "strengthened 
marketing activities" of the related importer SMC Korea as the two bases of its finding 
on price effects.644 
5.244.   The Panel thus understood the Korean investigating authorities to have considered that 
individual cases of dumped import resale prices  for some models that were lower than average 
domestic prices  and high -end domestic prices for corresponding models to certain customers  
(i.e. individual instances of "underselling") led to price suppression and price depression of the 
domestic like produc t.645 In this respect, we note that the Korean investigating authorities conducted 
and relied on these price comparisons, including evidence of price discrimination and aggressive 
pricing behaviour, to make the point that, despite the higher average prices o f the imported 
products, a finding of price suppression and price depression could nonetheless be sustained by the 
evidence .646 Similarly, the KTC examined and relied on the instances of price underselling to find 
that they "had the effect of suppressing inc reases in the price of the like product or causing decreases 
thereof".647  
5.245.   The Panel set out in a table what Korea  referred to as a series of comparisons between 
individual resale transaction prices of two models of dumped imported valves and the average pri ces 
of corresponding models of the domestic like product reported in the OTI's  Final Report. This table 
underlined those transactions in which the dumped import price to certain customers was lower than 
the average domestic price for the corresponding mode l produced and sold by the Korean 
producers.648 The Panel found that the listed transactions "took place on different dates and involved 
different quantities".649 The Panel observed that, in general, the lower the quantity involved in a 
transaction, the higher  the unit price of the dumped imported valve(s). The Panel took the view that, 
in light of the possible effect on the comparisons made, an unbiased and reasonable investigating 
authority could not have properly compared these individual transaction prices with the average 
domestic like product price of a corresponding model without further consideration and explanation 
of the relevance or significance of these differences.650 The Panel found that the evidence before it 
did not suggest that either the KTC or t he OTI made any effort to consider differences or their 
potential consequences for price suppression and price depression in the determination of material 
injury caused by dumped imports, thereby casting doubt on the validity of these comparisons.651  
5.246.   Accord ing to Korea, the Panel was wrong to rely on the above -mentioned table as an 
"exclusive basis" to find fault with the KTC's price -effect s analysis, because the table was nothing 
more than a n indicator of the Japanese respondents' strategic low pricing that the KTC then went 
on to examine in more detail.652 However, we note that the Korean investigating authorities relied 
on the outcome of these comparisons and , later, on the outcome of similar comparisons  concerning 
13 "representative models " to find price-suppressing and -depressing effects of the dumped imports. 
Indeed, as Korea stated before the Panel, "when SMC Korea [sold] the identical dumped product 
model to different customers" applying "widely different sales prices", it was "undercutting prices of 
domestic like product in individual transactions where it compete[d] with domestic producers"653 and 
thus "force[d] domestic producers to react to the fierce competition from dumped imports by 
                                                
644 Panel  Report, para.  7.300. (fn  omitted)  
645 Panel  Report, para.  7.302 (referring to OTI's Final Report (Panel Exhibit KOR -2b (BCI)), pp.  100-101; 
Korea's response to Panel's question No. 88(b), para.  19; Record Data on the Dumped Imports' Individual 
Resale Transaction (Panel Exhibit KOR -57 (BCI)) ). The Panel clarified that it used the term "underselling" as 
"shorthand" for the situation in which "prices of a model of dumped imports in certain transactions were lower 
than those of the corresponding domestic l ike product" as opposed to price undercutting, which is one of the 
three price effects mentioned in the second  sentence of Article  3.2 of the Anti -Dumping  Agreement. (Ibid., 
fn 419 to para.  7.302)  
646 Panel  Report, para.  7.316. See also ibid., para.  7.300.  
647 Panel  Report, para.  7.300 (quoting KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)), p.  19). 
(emphasis omitted)  
648 Panel  Report, para.  7.270 and Table 1 (referring to OTI's Final Report (Panel Exhibit KOR -2b (BCI), 
pp. 100-101)).  
649 Panel  Report, para.  7.271. 
650 Panel  Report, para.  7.271.  
651 Panel  Report, para.  7.271.  
652 Korea's opening statement at the oral hearing.  
653 Korea's response to Panel question no. 88, para.  22 (referring to OTI's Final Report (Panel Exhibit 
KOR-2b (BCI)), pp.  99-101 and fn  60). 
 WT/DS504/AB/R  
 
- 82 - 
 
  reducing prices of domestic like product".654 Moreover, the Panel recognized that "[i]n its Final 
Report, the OTI listed 'underselling' transactions for two models"655 and that , later on, "Korea 
provided [Panel] Exhibit KOR -57, a list of comparisons of the pric es of all of the resale transactions 
of the Japanese respondent SMC Korea during 2013 with the average and high -end prices of the 
corresponding models of the domestic like product."656  
5.247.   The KTC's transaction -to-average comparison analysis was thus aimed at a ssessing whether 
the prices of dumped imports were lower than the prices of domestic like products for determining 
price effects within the meaning of Article  3.2, second sentence. Price comparability thus became an 
important issue as the probative value o f the comparison depended on the degree of price 
comparability and concerned the objectivity and evidentiary foundation of the KTC's price 
suppression and price depression findings under Articles  3.1 and 3.2 . We agree with the Panel that 
the KTC was requir ed to ensure price comparability in these price comparisons inasmuch as it relied 
on the price differentials to find that dumped imports had price -suppressing and -depressing effects 
on domestic prices. However, the Panel's above analysis was pertinent to a claim under Article  3.2, 
and in line with the requirements of that provision, rather than to a claim under Article  3.5, where 
a panel 's task consists of reviewing  an investigating authority's ultimate injury and causation 
determination.  
5.248.   Korea further ar gues that, in examining the KTC's findings concerning the consistent 
overselling of dumped imports, the Panel found that "a 'sufficiently robust' analysis" must include 
"considerations as to 'whether, and if so how, … individual instances of "underselling"  with respect 
to certain models affected the prices of other models of the domestic like product, the extent of total 
domestic sales affected by such "underselling", or how these instances of "underselling " affected 
domestic like product prices as a whole'".657 Korea submits that the Panel thus "impos[ed] a 
requirement to demonstrate how and to what extent underselling in certain competitive sales 
affected the prices of the domestic like product 'as a whole' o r 'overall'", and that such a requirement 
has no basis in either Article  3.2 or Article  3.5 of the Anti -Dumping  Agreement.658 
5.249.   In response, Japan submits that the Panel did not impose an unreasonable burden on the 
Korean investigating authorities. Rather, acc ording to Japan, "[t]he Panel simply required some 
reasonable explanation grounded in facts that showed isolated examples of what were dissimilar 
transactions were in fact relevant to a finding of price effects for the product as a whole."659 Japan 
submits t hat the Panel correctly focused on the need to base conclusions about price suppression 
and price depression on the prices of the domestic like product as a whole, since a finding of price 
effects for a subset of the domestic like products cannot be applie d to all of the other domestic like 
products without positive evidence.660 
5.250.   We note that the KTC relied on individual instances of "underselling" to address the argument 
by the interested parties that the consistent overselling by dumped imports based on the average 
price would undermine findings of price suppression and price depression. In response to such an 
argument, the KTC relied on the transaction -to-average comparison  analysis and the "strengthened 
marketing activities".661 As noted by the Panel, the KTC  found that "the sales price of the dumped 
products was much lower than the average sales price" in the case of "certain products or customers 
                                                
654 Korea's response to Panel question no. 88, para.  23. 
655 Panel  Report, para.  7.304. (fn  omitted)  
656 Panel  Report, para.  7.305. We examine Korea's arguments challenging the Panel's examination of 
Panel Exhibit KOR -57 in section 5.3.4.1.5 below.  
657 Korea's other appellant's submission, para.  204 (quoting Panel  Report, para.  7.303).  
658 Korea's other appellan t's submission, para.  222. See also ibid., para.  205. 
659 Japan's appellee's submission, para.  100. (fn  omitted)  
660 Japan's appellee's submission, para.  101. 
661 We note that Korea accepts that "[i]n response to arguments about lack of competition between the 
imported and domestic products as evidenced by the relatively high degree of overselling, [the] KTC examined 
the extent to which the fact that the average sales price of the dumped imports was higher than that of the like 
product undermined its conclusion a bout the price suppressive effects of the dumped imports." (Korea's other 
appellant's submission, para.  237) Korea also accepts that the OTI found many examples of cases where 
imported products were actually resold or offered for resale to customers in Kor ea at prices similar to or even 
lower than the domestic sales price of the like product. (Ibid., para.  238) 
 WT/DS504/AB/R  
 
- 83 - 
 
  for which the degree of competition with the domestic industry was fierce, which had the effect of 
suppressing in creases in the price of the like product or causing decreases thereof ".662  
5.251.   The KTC thus introduced and relied on the evidence regarding the individual instances of 
"underselling" in order to respond to the interested parties' arguments concerning the existe nce of 
price overselling based on the average prices of all the products. The KTC reached the conclusion 
that these individual instances of "underselling" had the effect of suppressing and depressing the 
prices  of domestic like product despite the overall overselling by the dumped imports. In assessing 
whether the KTC provided sufficient reasoning for the above conclusions, the Panel found that "it is 
not clear" that the KTC considered whether, and if so how, the individual instances of "underselling"  
with respect to certain models affected "the prices of other models of the domestic like product, the 
extent of total domestic sales affected by such 'underselling', or how these instances of ' underselling'  
affected domestic like product prices as a whole".663  
5.252.   In response to Korea's argument that Panel Exhibit KOR -57 demonstrated how the KTC 
considered the extent to which the domestic like product prices were affected by individual instances 
of dumped imports' pricing, the Panel queried whether Panel Exhibit KOR -57, in conjunction with the 
OTI's Final Report664 and the KTC's Final Resolution, supported Korea's contention.665 The Panel 
noted that Panel Exhibit KOR -57 is a list of  115,524 transactions that reports the product code, 
series, date, quantity, value, and un it price of resale transactions of certain models of the dumped 
imports, and the average price and the high -end price of corresponding models of the domestic like 
product.666 The Panel observed that "[w]here the transaction resale price of the dumped imports  is 
lower than the average price or the high -end price of the domestic like product, a notation of 
'undercutting' is recorded for the particular transaction."667 The Panel considered that Panel Exhibit 
KOR-57 shows that "the OTI compared dumped import resale  prices in a large number of 
transactions in 2013 with the average price and the high -end price of the corresponding models of 
the domestic like product."668 Apart from the above, the Panel found that "[Panel] Exhibit KOR -57 
does not contain any other narrat ive."669 Ultimately, the Panel found that "[t]he mere fact that there 
are some instances of 'underselling', even if there are many of them, does not necessarily indicate 
that the prices of the domestic like product is suppressed or depressed as a whole  as a result."670 
5.253.   Although the Panel spoke of price suppression or depression of the domestic like product "as 
a whole", we do not consider the Panel to have imposed a legal requirement " to demonstrate how 
and to what extent underselling  in certain competitive sal es affected the prices of the domestic like 
product 'as a whole'", as Korea argues. 671 Rather, in the context of this case, the Panel examined 
the KTC's determination and, on that basis, "[understood] the KTC [to have ] found [that] the effects 
of these indi vidual instances were on domestic like product prices as a whole, and not only on the 
prices of certain models of the domestic like product".672 Indeed, the Panel noted the KTC to have 
stated:  
The Commission finds that the dumped products suppressed price in creases of the like 
product and caused decreases thereof, although the average sales price of the dumped 
products was higher than that of the like product.  
The average sales price of the dumped products was higher due to their price 
differentiation in acco rdance with models, option details or customers, but it was found 
that the sales price of the dumped products was much lower than the average sales 
price in the case of certain products or customers for which the degree of competition 
with the domestic ind ustry was fierce, which had the effect of suppressing increases in 
                                                
662 Panel  Report, para.  7.300 (quoting KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)), p.  19). 
(emphasis added by the Panel)  
663 Panel  Report, para . 7.303. (fn  omitted)  
664 OTI's Final Report (Panel Exhibit KOR -2b (BCI)).  
665 Panel  Report, para.  7.309.  
666 Panel  Report, para.  7.310.  
667 Panel  Report, para.  7.310.  
668 Panel  Report, para.  7.310.  
669 Panel  Report, para.  7.310.  
670 Panel  Report, para.  7.311. (emphasis  original)  
671 Korea's other appellant's submission, para.  222. 
672 Panel  Report, para.  7.302.  
 WT/DS504/AB/R  
 
- 84 - 
 
  the price of the like product or causing decreases thereof . It was investigated that SMC 
Korea … consistently expanded its sales organizations and used its dominant position to 
attract distribution agents or discourage defections of its distribution agents, and thus 
the domestic industry had to respond to such strengthened marketing activities of SM C 
Korea and become forced to decrease the sales price or refrain from increasing prices .673 
5.254.   As we see it, this is the context in which the Panel analy sed Panel Exhibit KOR -57 and found 
that it does not show whether, and if so how, the Korean investigating au thorities examined the 
extent to which domestic like product prices were affected by the individual instances of lower 
dumped import prices, noting further that "this Exhibit does not identify the corresponding models 
of the domestic like product whose pri ces are being 'undersold', or the quantity or value of the sales 
of those models."674 Indeed, without such information it is not clear how the Korean investigating 
authorities could have assessed the extent to which domestic like product prices were affected  by 
the pricing of the dumped imports in the selected transactions , such that a finding of price 
suppression and  price depression  could be reached.675 Nor could the Panel have refrained from 
examining whether the KTC took into account in its considerations a nd explanations the evidence of 
consistent price overselling and the relevant arguments raised by the interested parties.676 
Especially, when the Panel rightly recognized that "[c]onsideration of such questions would seem 
particularly warranted in the presen t case in light of the consistent … overselling by the dumped 
imports and the fact that the average  prices of the models of dumped imports involved in these 
individual instances of 'underselling' were still higher than the average prices of the correspondi ng 
domestic models."677 In the present dispute, we agree with the Panel that "[a]n explanation and 
analysis of how and to what extent the prices of the domestic like product are affected [was] 
necessary."678 
5.255.   However, consistent with our considerations above, w e find that the Panel's analysis was 
pertinent to a claim under Article  3.2, and in line with the requirements of that provision, rather 
than to a claim under Article  3.5. We note that the Panel inquired whether "the KTC's finding of a 
causal relationship based in part on price suppressing and depressing effects of dumped imports, in 
light of consistent average price overselling by dumped imports, is one that could have been reached 
by a reasonable and objective investigating authority on the basis of the e vidence and arguments 
before the KTC."679 Our review indicates that the outcome of the Panel's inquiry depended on a 
proper analysis that applied the requirements under Article  3.2, second sentence, concerning the 
interplay between the price effects found an d the average price overselling observed with respect to 
the dumped imports, as opposed to an analysis under Article  3.5. While we do not find any error in 
the Panel's analysis insofar as it relates to the applicable requirements set out in Article  3.2, th e 
Panel effectively incorporated and applied the requirements of Article  3.2, rather than properly 
applying the requirements set out in Article  3.5, even though it was reviewing a claim under 
Article  3.5. As noted, under Article  3.5, a panel is called upon  to review whether the investigating 
authority properly linked the outcomes  of its analyses conducted pursuant to Articles  3.2 and  3.4, 
taking into account the evidence and factors required under Article  3.5, in coming to a definitive 
determination regardi ng the causal relationship between dumped imports and injury to the domestic 
industry. We therefore consider the Panel to have erred in its application of Article  3.5 of the 
Anti-Dumping Agreement . 
5.3.4.1.5   Whether the Panel failed to make an objective assessment of the matter under 
Article  11 of the DSU and Article  17.6 of the Anti -Dumping  Agreement  
5.256.   On appeal, Korea raises several arguments under Article  11 of the DSU and Article  17.6(i) 
of the Anti -Dumping Agreement  with respect to the Panel's substantive findings under Articles  3.1 
and 3.5 of the Anti -Dumping  Agreement concerning Japan's "independent" claim of causation. We 
address each of these arguments in turn.  
                                                
673 Panel  Report, para.  7.300 (quoting KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)), p.  19). 
(emphasis added by the Panel)  
674 Panel  Report, para.  7.310.  
675 Panel  Report, para.  7.310.  
676 Panel  Report, para.  7.299.  
677 Panel  Report, para.  7.303. (emphasis ori ginal; fn  omitted)  
678 Panel  Report, para.  7.311. (fn  omitted)  
679 Panel  Report, para.  7.301.  
 WT/DS504/AB/R  
 
- 85 - 
 
  5.257.   First, Korea asserts that Japan's claim concerned the lack of competition between the 
imported and the domestic like products. Korea notes that the Panel rejected that claim and found 
in favour of Korea in this respect.680 Korea submits that the Panel then "constructed" another claim 
that wa s not developed by Japan concerning the lack of "fair comparison" as a result of the 
transaction -to-average comparison of certain prices.681 Therefore, Korea submits that, "[i]n so 
doing, the Panel made the case for Japan, determining that a violation existe d based on a claim that 
was never made or developed, in violation of Article  11 of the DSU."682 
5.258.   We recall that we have already addressed Korea's arguments in support of its claim that the 
Panel erred in law by unduly relieving Japan of its burden to demonstr ate that the KTC failed to 
ensure price comparability between the dumped imports and the domestic like products in its 
price-effects analysis.683 In support of its present claim under Article  11 of the DSU, Korea makes 
the same arguments. Therefore, Korea's claim under Article  11 of the DSU is  subsidiary to its claim 
concerning the Panel's failure to construe or apply correctly provisions of a covered agreement, in 
this case Articles  3.1 and  3.5 of the Anti -Dumping  Agreement.684  
5.259.   Next, Korea asserts that the Pa nel "re -constructed [the] KTC's price effects analysis" by 
suggesting that the KTC made findings of price undercutting for the product and turned the price 
comparisons that were made to corroborate other information on the record into a determinative 
eleme nt of the price -effects analysis.685 In so doing, Korea contends that "the Panel engaged in a 
de novo analysis in violation of Article  17.6 of the Anti -Dumping  Agreement."686 
5.260.   We do not, however, find Korea to have pointed out the relevant passages from the 
Panel  Report  that, in its view, demonstrate that the Panel "re -constructed [the] KTC's price effects 
analysis". Nor do we find Korea to have articulated and substantiated its  claim with specific 
arguments. To the contrary, we recall that the Panel specifically noted that "the KTC did not find 
price undercutting ."687 We are therefore not convinced that Korea has made out a case that the 
Panel engaged in a de novo analysis in viol ation of Article  17.6(i) of the Anti -Dumping  Agreement.  
5.261.   Korea further submits that the Panel focused exclusively on the evidence relating to the 
instances of aggressive pricing and underselling, and disregarded all of the other evidence that was 
actually relied on by the Korean investigating authorities to support their finding of price suppression 
and price depression, including the evidence corroborating the existence of competition.688 Thus, 
Korea contends that "[t]o reduce the price effects analysis effe ctively to a comparison of transaction -
to-average prices and examples of strategic marketing, in the way the Panel did, is neither objective 
nor fair" when seen from the purview of Article  11 of the DSU and Article  17.6 of the 
Anti-Dumping  Agreement.689 
5.262.   In response, Japan submits that Korea provides no specifics at all.690 Japan avers that Korea 
alleges evidence was ignored but does not cite to a single specific piece of allegedly ignored 
evidence.691 Thus, according to Japan , "[i]t is not at all clear what 'evid ence' Korea means in 
connection with its Article  11 claim."692 
                                                
680 Korea's other appellant's submission, para.  263. 
681 Korea's other appellant's submission, para.  263. 
682 Korea's other appellant's submission, para.  263. 
683 See section  5.3.4.1.4.1 above.  
684 See Appellate  Body Report, US – Anti-Dumping and Countervailing Duties (China) , para.  337 
(referring to Appellate  Body Reports, US – Steel Safeguards , para.  498; Australia – Apples , para.  406).  
685 Korea's other appellant's submission, para. 263. 
686 Korea's other appellant's submission, para.  263. 
687 Panel  Report, para.  7.269 (referring to KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)) , p. 18; 
Korea's first written submission to the Panel, para.  128).  
688 Korea's other appellant's submi ssion, para.  264. 
689 Korea's other appellant's submission, para.  264. 
690 Japan's appellee's submission, para.  142. 
691 Japan's appellee's submission, para.  142. 
692 Japan's appellee's submission, para.  142. 
 WT/DS504/AB/R  
 
- 86 - 
 
  5.263.   The Appellate  Body has stated that for a challenge under Article  11 of the DSU to succeed, 
an appellant must identify specific errors regarding the objectivity of the panel's assessment.693 It 
is therefore "incumbent on a participant raising a claim under Article  11 … to explain why the alleged 
error meets  the standard of review under that provision" .694 However, in this instance, while Korea 
argues that "the Panel willfully ignored and disregarded ce rtain evidence that was presented by 
Korea supporting the determination of the dumped imports' price effects"695, Korea fails to identify 
the evidence that the Panel allegedly ignored and disregarded. Nor do we find Korea to have 
explained why it considers the Panel to have conducted a de novo review inconsistently with 
Article  17.6(i) of the Anti -Dumping  Agreement.  Korea's argument that the Panel erred under 
Article  17.6(i) is the same as that presented in support of its claim under Article  11 of the DSU.696 
We are therefore not convinced that Korea has made a case for finding a violation of Article  11 of 
the DSU or Article 17.6(i) of the Anti -Dumping  Agreement.  
5.264.   Next, Korea contends that the Panel made findings that were internally inconsistent and 
contradictory.697 Korea submits that the Panel found, in paragraph 8.3 of the Panel  Report , that 
Japan did not demonstrate that the causation analysis that the KTC made was inconsistent with 
Articles  3.1 and 3.5 of the Anti -Dumping  Agreement.698 Korea notes that the Panel made a similar 
finding of "no inconsistency with respect to the second important aspect of a causation analy sis, 
relating to the examination of other known factors and non -attribution".699 However, Korea avers 
that "without any explanation of how these contradictory and internally inconsistent findings can be 
squared", the Panel found , in paragraph 8.4 of the Panel Report , that the "causation analysis, as a 
result of flaws in their analysis of the effect of the dumped imports on prices in the domestic market", 
violated Articles  3.1 and 3.5.700 
5.265.   In response, Japan submits that this argument by Korea ignores the fact th at the Panel was 
addressing three separate claims, each with a distinct focus.701 Japan explains that its "claim 4 about 
causal relationship focused specifically on the lack of any correlations or any other evidence 
necessary to support a finding of causatio n", whereas, its "claim 5 about other factors focused on 
the distinct obligation of non -attribution."702 According to Japan, "[t]hese claims both relate to 
causation, but do not overlap or supersede Japan's claim 6 about the ultimate conclusion about 
'causin g injury' notwithstanding the findings under Articles  3.2 and 3.4."703 
5.266.   We recall that before the Panel, Japan raised three claims with respect to Articles  3.1 and  3.5 
of the Anti -Dumping  Agreement. The Panel did not follow the sequence in which Japan listed these 
claims and, instead, commenced its evaluation with claim 6, i.e. the "independent" causation claim, 
followed by its evaluation of claims 4 and 5, respectively. The Panel then made a separate finding 
with regard to each of these claims. With respect t o claim 4, Japan contended that the existence of 
any causal relationship between the dumped imports and the alleged injury was undermined because 
of insufficient correlation between the volume trends, price trends, profit trends, and the state of 
the domes tic industry.704 The Panel, in our view, correctly noted that this claim focuses on "the 
alleged failure to demonstrate the existence of a causal relationship between dumped imports and 
injury to the domestic industry"705, in support of which Japan argued that  "there is a lack of 
correlation in the trends of volumes, prices, and profits."706 With respect to claim 5, Japan argued 
that the KTC acted inconsistently with Articles  3.1 and 3.5 "because Korea failed to consider 
                                                
693 Appellate  Body Report, US – Carbon Steel (India) , para.  4.79 (referring to Appellate  Body Report, 
EC – Fasteners (China) , para.  442).  
694 Appellate  Body Report, US – Carbon Steel (India) , para.  4.79 (quoting Appellate  Body Reports, 
China  – Rare Earths , para.  5.178, in turn quoting Appellate  Body Re port, EC – Fasteners (China) , para.  442 
(emphasis original)).  
695 Korea's other appellant's submission, para.  264. 
696 See Korea's other appellant's submission, paras.  285-286. 
697 Korea's other appellant's submission, para.  265. 
698 Korea's other appellant's subm ission, para.  265. 
699 Korea's other appellant's submission, para.  265. 
700 Korea's other appellant's submission, para.  265. 
701 Japan's appellee's submission, para.  143 (referring to Korea's other appellant's submission, 
para. 261).  
702 Japan's appellee's submission, para.  143. 
703 Japan's appellee's submission, para.  143. 
704 Panel  Report, para.  7.351.  
705 Panel  Report, para.  7.233.  
706 Panel Report, para.  7.234.  
 WT/DS504/AB/R  
 
- 87 - 
 
  adequately all known factors other than the imports under investigation that were injuring the 
domestic industry at the same time and therefore incorrectly attributed injury caused by these other 
factors to the imports under investigation" .707 As the Panel noted , this claim by Japan concerned the 
KTC's evaluation of non -attribution factors under " the distinct obligation regarding non -attribution 
analysis, as set forth in the third and fourth sentences of Article  3.5".708 The Panel's overall findings 
in paragraphs 8.3.b and 8.3.c709 of the Panel  Report  concerned  these two claims, respectively. 
Finally, the Panel's finding in paragraph 8.4.a710 was with respect to Japan's claim 6, that the KTC's 
causation determination was undermined by its flawed analysis of  the price effects, "irrespective and 
independent" of whether the Panel found the KTC's analysis of price effects to be inconsistent with 
Article  3.2 of the Anti -Dumping  Agreement. For these reasons, we are not convinced that the Panel 
made internally inco nsistent findings such that it acted inconsistently with Article  11 of the DSU.  
5.267.   Korea further contends that "even at the very basic level of the Panel's analysis of the facts 
relating to the price comparisons and … overselling, the Panel's analysis is not supported by the 
facts on the record and reflects a disregard of relevant, material evidence."711 Korea submits that 
the biggest disregard of relevant evidence was committed by the Panel when it found that the "KTC 
did not find price undercutting" and thus, "the KTC did not rely on the results of any price 
comparisons between the average dumped import prices and the average domestic like product 
prices in injury determination."712 Korea submits that, although it is true that the KTC did not find 
price undercutt ing, that does not mean that the KTC's comparison of average dumped import prices 
and average domestic like product prices cannot serve any purpose in its price suppression 
analysis.713 Korea submits that it raised a timely objection against this error in it s Comments on the 
Interim Report of the Panel but the Panel "simply disregarded the parties' comments"714, and thereby 
erred under Article  11 of the DSU.715 
5.268.   In response, Japan submits that the Panel did not ignore the point regarding the comparison 
of average price trends.716 Japan submits that Korea is trying to create an issue where none exists. 
According to Japan, in the part of the Panel  Report  referenced by Korea717, the Panel specifically 
referred to the KTC's finding of price undercutting in the sense of the  second sentence of 
Article  3.2.718 Japan explains, "[s]ince there was no KTC finding of price undercutting, there was no 
                                                
707 Panel  Report, para.  7.236 (quoting Japan's panel request, p.  2). 
708 Panel  Report, para.  7.238.  
709 The Panel found:  
With respect to those of Japan's claims that are within our terms of reference as set forth in 
paragraph 8.2 above,  we conclude that Japan has not demonstrated that the Korean 
Investigating Authorities acted inconsistently with:  
… 
b. Articles  3.1 and 3.5 of the Anti -Dumping  Agreement with respect to their conclusion that the 
dumped imports, through the effects of dumpi ng, were causing injury to the domestic industry ; 
and 
c. Articles  3.1 and 3.5 of the Anti -Dumping  Agreement with respect to their examination of 
known factors other than the dumped imports that were injuring the domestic industry at the 
same time.  
(Panel  Report, paras.  8.3.b-c) (emphasis original)  
710 The Panel found:  
With respect to those of Japan's claims that are within our terms of reference as set forth in 
paragraph 8.2 above, we further conclude that Japan has demonstrated  that the Korean 
Investigating Authorities acted inconsistently with:  
a. Articles  3.1 and 3.5 of the Anti -Dumping  Agreement in their causation analysis as a result of 
flaws in their analysis of the effect of the dumped imports on prices in the domestic market[.]  
(Panel  Report, para.  8.4.a) (emphasis original)  
711 Korea's other appellant's submission, para.  266. 
712 Korea's other appellant's submission, para.  268 (quoting Panel  Report, para.  7.269).  
713 Korea's other appellant's submission, para.  268. 
714 Korea's other appellant's submission, par a. 270 (referring to Korea's Comments on the Interim 
Report to the Panel, para.  38). 
715 Korea's other appellant's submission, para.  271. 
716 Japan's appellee's submission, para.  146. 
717 Japan's appellee's submission, para.  146 (referring to Korea's other appel lant's submission, fn  190 to 
para. 269, in turn referring to Panel  Report, para.  7.295).  
718 Japan's appellee's submission, para.  146 (referring to Panel  Report, para.  7.269).  
 WT/DS504/AB/R  
 
- 88 - 
 
  need for Japan to challenge or the Panel to address price comparability with regard to a method of 
analyzing price effects under the sec ond sentence of Article  3.2 that the KTC did not use."719 
5.269.   We recall that the Panel noted that  the KTC , in its price undercutting analysis, compared 
average dumped import prices to average domestic like product prices and concluded that dumped 
imports had not  been sold at lower prices than the domestic like product, that is, there was no price 
undercutting.720 The Panel observed that the KTC did not find price undercutting and thus, "the KTC 
did not rely on the results of any price comparisons between the average dumped import prices and 
the average domestic like product prices in its injury determination."721 The Panel made this 
observation in the context of price undercutting and the relevance of such a finding with respect to 
the ultimate determination of injury to the domestic industry. Because the KTC made  no price 
undercutting finding, it was logical that the Panel stated so. I mportantly, in that light, the Panel 
considered that there was no need to decide whether the prices in those average -to-average 
comparisons were properly comparable.722 However, in considering the issue of diverging price 
trends, we note that the Panel took into account the average -to-average comparisons when it found 
the KTC's explanations regarding the diverging price trends in 2011 -2012 and 2012 -2013 to be 
reasonable.723 We are therefore not convinced  that Korea has demonstrated  that the Panel acted 
inconsis tently with Article  11 of the DSU on this count.  
5.270.   Next, Korea recalls that it submitted Panel Exhibit KOR -57 to demonstrate how the KTC 
considered the extent to which the domestic like product was affected by individual instances of 
dumped imports' pricing .724 Korea explains that Panel Exhibit KOR -57 constituted the entire data 
sheet on the basis of which the KTC conducted its transaction -to-average price comparisons for the 
purpose of its price suppression and price depression analysis.725 Korea avers that the  Panel correctly 
determined that Panel Exhibit KOR -57 was properly before it, but found that "[Panel] Exhibit KOR -57 
does not, in itself , sufficiently demonstrate whether and how the OTI conducted the simulations and 
analyses, and reached the relevant conc lusions as argued by Korea."726 Korea submits that "the 
Panel was not even handed in its approach and applied an excessive degree of certainty and proof, 
refusing to draw any inferences from [Panel Exhibit] KOR -57" and thus admitted only what was 
immediately  apparent from Panel Exhibit KOR -57.727 
5.271.   In response, Japan submits that "the Panel correctly rejected Korea's efforts to present 
post hoc justifications with no basis in the KTC Determination as written."728 Japan argues that "the 
data and analysis contained i n [Panel] Exhibit KOR -57 were not mentioned in the KTC's Final 
Resolution or the OTI's Final Report."729 Japan adds that "even assuming arguendo  the data in [Panel 
Exhibit] KOR -57 were actually 'examined' during the investigation", the KTC's examination did not 
address "the counterfactual question of whether the domestic prices would have been higher if the 
dumped imports had been at the normal value".730 Japan further submits that "if [Panel] 
Exhibit  KOR-57 revealed anything about price effects, it showed that  the alleged instances of 
average -price-based price undercutting occurred only within a small proportion of the domestic like 
                                                
719 Japan's appellee's submission, para.  146. 
720 Panel  Report, para.  7.267.a (referring to KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)) , p. 18). 
721 Panel  Report, para.  7.269.  
722 Panel  Report, para.  7.269.  
723 Panel  Report, paras.  7.278 -7.279.  
724 Korea's other appellant's submission, para.  272. 
725 Korea's other appellant's submission, para.  272. We recall that the Panel set out in a table what 
Korea  referred to as a series of comparisons between individual resale transaction prices of models of dum ped 
imported valves and the average prices of corresponding models of the domestic like product reported in the 
OTI's Final Report. The OTI underlined those transactions in which the dumped import price to certain 
customers was lower than the average domes tic price for the corresponding model produced by the Korean 
producers. (Panel  Report, para.  7.270, Table 1) See also Panel  Report, para.  7.310.  
726 Korea's other appellant's submission, para.  274 (quoting Panel  Report, para.  7.313 (emphasis 
original)).  
727 Korea's other appellant's submission, para.  277. 
728 Japan's appellee's submission, para.  147. 
729 Japan's appellee's submission, para.  148 (referring to Japan's comments on Korea's response to 
Panel question No. 88, para.  26). 
730 Japan's appellee's submission, p ara. 148 (referring to Japan's comments on Korea's response to 
Panel question No. 88, para.  27). 
 WT/DS504/AB/R  
 
- 89 - 
 
  products" and "the KTC never linked isolated examples to the product as a whole."731 Thus, Japan 
contends that it had pointed out th at Panel Exhibit KOR -57 is deeply flawed.732 
5.272.   We have considered above the Panel's discussion of Panel Exhibit KOR -57 and agreed with 
the Panel's reading of that Exhibit.733 To recall, the Panel explained that Panel Exhibit KOR -57 shows 
that "the OTI compared d umped import resale prices in a large number of transactions in  2013 with 
the average price and the high -end price of the corresponding models of the domestic like 
product."734 However, the Panel found that Panel Exhibit KOR -57 does not show whether, and if so 
how, the OTI examined the extent to which domestic like product prices were affected by the 
individual instances of lower dumped import prices, noting that "this Exhibit does not identify the 
corresponding models of the domestic like product whose price s are being 'undersold', or the 
quantity or value of the sales of those models."735 Therefore, the Panel considered that it is not clear 
how the Korean investigating authorities could have assessed the extent to which domestic like 
product prices were affect ed by the pricing of the dumped imports in the transactions concerned.736  
5.273.   That said, Korea's contention is that it would have been perfectly logical for the Panel to 
consider that the KTC, after having been rigorous enough to compare and check every one of the 
115,524 resale transaction prices of the dumped imports in 2013 with the average and high -end 
prices of the corresponding domestic model, could be assumed to take the next step of conducting 
a simple wrap -up calculation to arrive at the observations as  explained by Korea in its other 
appellant's submission.737 Thus, Korea's argument that the Panel did not draw those conclusions 
that Korea suggested is squarely directed towards the Panel's weighing of evidence and the probative 
value accorded by the Panel to Panel Exhibit KOR -57. In making this argument, Korea essentially 
suggests that the Panel should have accorded to Panel Exhibit KOR -57 the same evidentiary weight 
that it would itself have accorded to it.  The Appellate  Body has consistently recognized that panels 
enjoy a margin of discretion in their assessment of the facts738, which includes the discretion of a 
panel to decide which evidence it chooses to utilize in making its findings739, and to determine how 
much weight to at tach to the various items of evidence placed before it by the parties to the case.740 
The Panel did not commit an error under Article  11 of the DSU simply because it declined to accord 
to the evidence the weight that Korea believes should have been be accord ed to it.741  
5.274.   Korea also contends that the Panel erred under Article  17.6(i) of the Anti-Dumping 
Agreement when it examin ed Japan's price -related issues under claim 6 in a de novo manner by , 
inter alia: (i) "creating and applying specific and excessively dem anding requirements that must be 
met in an overselling situation"; and (ii) "imposing isolated findings on the authorities which it then 
examined independently and irrespectively of the analysis provided by [the] KTC".742  
5.275.   In response, Japan submits that the  Panel did not create excessively demanding 
requirements.743 Japan adds that the Panel properly focused on what the KTC and the OTI had 
actually said about their analyses .744 Japan further submits that the Panel did not impose any isolated 
findings, noting tha t Korea does not present any arguments to support this allegation.745  
5.276.   Both of Korea's above arguments form the basis of separate claims that Korea has raised on 
appeal. We recall in this regard that Korea has challenged the Panel's findings on the grounds t hat: 
                                                
731 Japan's appellee's submission, para.  148 (referring to Japan's comments on Korea's response to 
Panel question No. 88, para.  27). (fn  omitted)  
732 Japan's appel lee's submission, para.  148. 
733 See section 5.3.4.1.4.2 above.  
734 Panel  Report, para.  7.310.  
735 Panel  Report, para.  7.310.  
736 Panel  Report, para.  7.310.  
737 Korea's other appellant's submission, para.  277. 
738 See Appellate  Body Reports, EC – Asbestos , para.  161; EC – Hormones , para.  132;  
EC – Sardines , para.  299; Japan – Apples , para.  222; Korea – Dairy , para.  137; US – Wheat Gluten , para.  151. 
739 Appellate  Body Report, EC – Hormones , para.  135. 
740 Appellate  Body Report, Korea – Dairy , para.  137. 
741 See Appellate  Body Reports, Australia – Salmon , para.  267; Japan – Apples , para.  221; 
Korea  – Alcoholic Beverages , para.  164. 
742 Korea's other appellant's submission, para.  282. 
743 Japan's appellee's submission, para.  153. 
744 Japan's appellee's submission, para.  153. 
745 Japan's appellee's submission, para.  155. 
 WT/DS504/AB/R  
 
- 90 - 
 
  (i) the Panel unduly relieved Japan of its burden of demonstrating that the KTC failed to ensure price 
comparability746; (ii) the Panel imposed a price comparison requirement under Article  3.5 that is not 
based on the text of Article  3.5 and is more dem anding than what is required under Article  3.2747; 
and (iii) the Panel found a violation under Articles  3.1 and 3.5 based on a partial analysis of the 
KTC's price-effect s analysis that was made.748 In the context of those claims, Korea has argued that 
the Pane l examined different aspects of the price -effects findings of the KTC in clinical isolation749; 
the Panel imposed groundless analytical requirements, which, for most part, are excessively 
burdensome and impractical750; the Panel imposed an additional obligatio n of rigor in a price 
comparison analysis when no such rigor was required751; the Panel unduly focused on one aspect of 
the analysis relating to the explanatory force of the dumped imports concerning the examples of 
marketing practices and pricing752; and the Panel found the KTC's price-effect s analysis to be 
inconsistent with Article  3.5 based solely on concerns over particular aspects of one part of the 
price-effect s analysis, in isolation from all other evidence and findings made.753 We have addresse d 
these claims and arguments above. We recall that the Appellate  Body has found that "a claim under 
Article  17.6(i) should not be made merely  subsidiary to a claim that the panel erred in its application 
of a WTO provision."754 In our view, Korea's claim tha t the Panel erred under Article  17.6(i) of the 
Anti-Dumping  Agreement on the grounds described in paragraph  5.274  above is subsidiary to its 
earlier claims contending  that the Panel erred in its application of Article  3.5 of the 
Anti-Dumping  Agreement.  
5.277.   Finally, Korea contends that the Panel examined the price -related claim of Japan under 
Articles  3.1 and 3.5 of the Anti -Dumping  Agreement in a de novo manner by "creati ng and using its 
own tables of the price trends, such as in figures 1 -4" and thus acted inconsistently with 
Article  17.6(i) of the Anti -Dumping  Agreement.755 
5.278.   Japan submits that there is nothing wrong with the Panel taking data on the Panel record 
and presenting graphs to illustrate what the numbers show.756 According to Japan, the graphs simply 
provide a visualization of the data; they do not change the data and, therefore, there is nothing 
de novo about converting data to graphs.757 
5.279.   We observe that the so urce for Figures  1758 and 2759 in the Panel  Report  is the KTC's Final 
Resolution, which is not disputed by Korea. Figure 3760 in the Panel  Report  is sourced from Korea's 
first written submission to the Panel , which is also not disputed by Korea. Neither do we un derstand 
Korea to dispute the source of the data contained in  Figure 4 in the Panel  Report , which, as the Panel 
stated, was derived from Panel Exhibit KOR -58.761 Thus, Korea does not take issue with the 
correctness of the underlying data that the Panel used in presenting Figures 1 through 4 in the 
Panel  Report , nor does Korea contend that , in presenting the Figures, the Panel misrepresented the 
underlying data. Accordingly, we fail to see how the Panel acted in a de novo manner inconsistently 
with Article  17.6(i) of the Anti -Dumping  Agreement.  
5.3.4.1.6   Conclusion with respect to claim 6  
5.280.   With respect to a claim under Article  3.5, a panel is tasked with reviewing an investigating 
authority's ultimate demonstration that "dumped imports are, through the effects of dumping , as 
                                                
746 Korea's other appellant's submission, paras.  197-207. 
747 Korea's other appellant's submission, paras.  208-226. 
748 Korea's other appellant's submission, paras.  227-243. 
749 Korea's other appellant's submission, para.  214. 
750 Korea's other appellant's submission, para.  215. 
751 Korea's other appellant's submission, para.  218. 
752 Korea's other appellant's submission, para.  223. 
753 Korea's other appellant's submission, para.  228. 
754 Appellate  Body Report, US – Anti-Dumping Methodologies (China) , para.  5.47. (emphasis original)  
755 Korea's other appellant's submission, para.  282. 
756 Japan's appellee's submission, para.  154. 
757 Japan's  appellee's submission, para.  154. 
758 Panel  Report, Figure 1: Trends in average prices, p.  80. 
759 Panel  Report, Figure 2: Trends in market share, p.  81. 
760 Panel  Report, Figure 3: Price trends of representative models, p.  82. 
761 Panel  Report, Figure 4: Compari son between the average prices of the dumped imports and the 
domestic like product on representative models basis, p.  93 (referring to Record Data and Analysis on the 
Representative Model  (Panel Exhibit KOR -58 (BCI))).  
 WT/DS504/AB/R  
 
- 91 - 
 
  set forth in paragraphs 2 and 4 ," causing injury to the domestic industry. In so doing, a panel is 
called upon to review whether the investigating authority properly linked the outcomes of its 
analyses conducted pursuant to Article s 3.2 and  3.4, taking into account the evidence and factors 
required under Article  3.5, in coming to a definitive determination regarding the causal relationship 
between dumped imports and injury to the domestic industry. A panel's review does not, however, 
call for revisitin g the question whether each of the interlinked components of this determination 
itself meets the applicable requirements set out in Article  3.2 or Article 3.4. Examining such 
consistency in the context of a claim under Article  3.5 would effectively require a panel to incorporate 
and apply obligations and disciplines set out in other paragraphs of Article  3, which are not contained 
in the text of Article  3.5. We agree with Korea that the phrase "through the effects of dumping, as  
set forth in paragraphs  2 and  4" in Article  3.5 "is not a call [for a panel] to re -do the examination[s]" 
under Articles  3.2 and 3.4 of the Anti -Dumping Agreement .762 
5.281.   In the present dispute, under claim 6, Japan alleged that the KTC's causation determinatio n 
was undermined by its flawed analyses of the volume of the dumped imports, the price effects, and 
the impact of the dumped imports on the state of the domestic industry, "irrespective and 
independent" of whether the Panel found the KTC's analyses of volu me, price effects, and impact to 
be inconsistent with Articles  3.2 and 3.4 of the Anti -Dumping  Agreement.  
5.282.   In addressing claim 6, the Panel first considered Japan's arguments with respect to the 
volume of dumped imports. The Panel noted that "Japan's alleg ation that certain flaws in the KTC's 
analysis of the volume of dumped imports 'independently' undermine [d] its causation 
determination"763 was based on the fact that: (i) the volume of dumped imports decreased during 
two years of the three -year period of tr end analysis; and (ii) the volume of dumped imports 
increased only modestly in absolute terms and decreased in terms of market share in 2013 compared 
with 2010.764 The Panel rejected these arguments and found that Japan failed to demonstrate that 
the Korean investigating authorities acted inconsistently with Articles  3.1 and 3.5 of the 
Anti-Dumping  Agreement. In so doing, the Panel reviewed the Korean investigating authorities' 
analysis pursuant to the requirements set out in Article  3.2, first sentence, as o pposed to those 
under Article  3.5. Thus, in reviewing the causation claim at issue, the Panel effectively incorporated 
the requirements in Article  3.2, first sentence, rather than properly applying the requirements set  
out in Article  3.5, in its assessment  of the causation claim at issue . We therefore consider the Panel 
to have erred in its application of Article  3.5.  
5.283.   With respect to price effects in the context of claim 6, before the Panel, Japan advanced 
three grounds in support of its claim that the KTC's analysis of the price effects of the dumped 
imports "independently" undermined its causation determination, namel y that: (i) there was 
divergence between the trends in dumped import and domestic like product prices; (ii) dumped 
imports consistently and significantly oversold the domestic like product; and (iii) there was no 
competitive relationship between the dumped  imports and the domestic like product,  such that their 
prices were not comparable.765 The Panel found that the KTC acted inconsistently with Articles  3.1 
and 3.5 of the Anti -Dumping  Agreement by "failing to ensure price comparability, in terms of the 
dates and sales quantities involved, when it compared the individual transaction prices of certain 
models of dumped imports with the average prices of corresponding models of the domestic like 
product".766 Concerning overselling, the Panel found that the Kor ean investigating authorities failed 
to explain adequately their consideration of the price-suppressing and -depressing effects of dumped 
imports in their determination of causation, in light of the undisputed fact that the prices of the 
dumped imports wer e higher than those of the domestic like product  throughout the period of trend 
analysis, and therefore acted inconsistently with Articles  3.1 and  3.5.767 As for diverging price trends, 
the Panel found that the different magnitude of the price decreases from  2012 to 2013 and the 
opposing price movements from 2011 to 2012 d o not, in  and of  themselves, demonstrate that the 
KTC's determination of a causal relationship was inconsistent with Articles  3.1 and 3.5.768 
5.284.   To the extent that an investigating authority reli es on price comparisons in its consideration 
of the price effects of dumped imports, price comparability needs to be ensured. Thus, where an 
                                                
762 Korea's other appellant's submissio n, para.  185. 
763 Panel  Report, para.  7.250.  
764 Panel  Report, para.  7.251.  
765 Panel  Report, para.  7.259.  
766 Panel  Report, para.  7.272.  
767 Panel  Report, para.  7.322.  
768 Panel  Report, para.  7.296.  WT/DS504/AB/R  
 
- 92 - 
 
  investigating authority fails to ensure price comparability in price comparisons between dumped 
imports and the dom estic like product s, this undermines its findings of price effects under Article  3.2, 
to the extent that it relies on such price comparisons. We agree with the Panel that the KTC was 
required to ensure price comparability in its price comparisons inasmuch as it relied on the price 
differentials in these comparisons to find that dumped imports had price -suppressing 
and -depressing effects on the domestic like product . Likewise, we agree with the Panel that , given 
the consistent overselling by the dumped impo rts and the fact that the average prices of the models 
of dumped imports involved in the individual instances of "underselling" were higher than the 
average prices of the corresponding domestic models, an explanation and analysis of how and to 
what extent the prices of the domestic like product are affected was necessary. That said, our review 
of the Panel's findings indicates that , for each of these arguments , the analyses carried out by the 
Panel were pertinent to a claim under Article  3.2 and were in lin e with the requirements of that 
provision, rather than to a claim under Article  3.5. In so doing, the Panel effectively incorporated 
the requirements of Article  3.2, rather than properly applying the requirements set out in Article  3.5, 
even though it was reviewing a claim under the latter provision . With respect to a claim under 
Article  3.5, a panel's review does not call for revisiting the question whether each of the interlinked 
components of the causation determination itself meets the applicable requirements set out under 
their respective provisions, such as, the consideration of pric e effects under Article  3.2. We therefore 
consider the Panel to have erred in its application of Article  3.5.  
5.285.    Finally, with respect to the examination of the impact of dumped imports in the context of 
claim 6, before the Panel, Japan relied on its argume nt that, because the KTC did not establish any 
logical connection between the effects of the dumped  imports under Article  3.2 and the condition of 
the domestic industry for the purpose of its impact analysis under Article  3.4, its causation 
determination w as undermined.769 The Panel found that "'the logical progression of inquiry' does not 
mean that the examination of impact under Article  3.4 must be linked to the consideration under 
Article  3.2."770 We agree with the Panel that , in order to examine the impact of dumped imports on 
the domestic industry properly for purposes of Article  3.4, an investigating authority is not required 
to link that examination with its consideration of the volume and the price effects of the dumped 
imports.771 Similarly, we agree with  the Panel's finding that "there is no need 'to undertake a fully 
reasoned causation and non -attribution analysis' as part of Article  3.4."772 However, the Panel's 
examination of the alleged flaws in the Korean investigating authorities' impact analysis prim arily 
relates to the issue of whether the KTC's impact examination was in line with the requirements set 
out in Article  3.4, as opposed to Article  3.5. In so doing, the Panel effectively incorporated the 
requirements of Article  3.4, rather than properly applying the requirements set out in Article  3.5, 
even though it was reviewing a claim under the latter provision . Article  3.5 does not foresee a panel 
revisiting the question whether an investigating authority's impact analysis is consistent with 
Article  3.4. We therefore consider the Panel to have erred in its application of Article  3.5.  
5.286.   In light of the foregoing considerations, with respect to claim 6, we reverse  the Panel's 
finding, in paragraph 8.4.a of the Panel  Report , that Japan has demonstrated that  the Korean 
investigating authorities acted inconsistently with Articles  3.1 and 3.5 of the A nti-Dumping  
Agreement  in their causation analysis as a result of flaws in their analysis of the effect of the dumped 
imports on prices in the domestic market.  
5.3.4.2   Japan's claim 4  
5.3.4.2.1   Whether the Panel erred in its approach to resolving Japan's claim 4 about the 
failure to demonstrate a causal relationship focusing on the lack of co rrelation among 
various factors  
5.287.   Before the Panel, Japan argued that the KTC failed to demonstrate that the dumped imports 
were causing injury to the domestic industry since there was insufficient correlation between the 
volume trends, price trends, and pro fit trends and the state of the domestic industry to support the 
                                                
769 Japan's first written submission to the Panel, para.  195 (referrin g to ibid., section V.D).  
770 Panel  Report, para.  7.329 (quoting Appellate Body Report, China – GOES , para.  128). (fn  omitted)  
771 Panel  Report, para.  7.330.  
772 Japan's appellant's submission, para.  290 (quoting Panel  Report, para.  7.332).  
 WT/DS504/AB/R  
 
- 93 - 
 
  existence of a causal relationship between the dumped imports and the injury to the domestic 
industry.773 
5.288.   The Panel found that Japan's arguments concerning volume trends and price trends were 
identical to its volume and price -effects -related arguments under its "independent" causation 
claim.774 On the basis of the same considerations, the Panel dismissed these arguments.775 Turning 
to Japan's arguments concerning profit trends, the Panel found that Japan failed to establish that 
insufficient correlation between dumped imports and trends in domestic -industry profits suffices to 
demonstrate that a reasonable and unbiased investigating authority could not have properly found 
the required causal relation ship between the dumped imports and injury to the domestic industry in 
light of the facts and arguments that were before the KTC.776 Ultimately, the Panel concluded that 
Japan failed to demonstrate that the Korean investigating authorities acted inconsistent ly with 
Articles  3.1 and 3.5 of the Anti -Dumping  Agreement by failing to demonstrate that the dumped 
imports, through the effects of dumping, were causing injury to the domestic industry.777 
5.289.   On appeal, Japan contends that the Panel dismissed Japan's argument s about volume 
correlation and price correlation by simply citing its own earlier findings on Japan's "independent" 
causation claim.778 Japan submits that "[t]he first claim was about price/volume effect analysis or 
impact analysis, but the second claim was not."779 Japan's avers that its "basic point was simply that 
the lack of sufficient correlation – that domestic industry volume and price trends did not correlate 
well with the import volume and price trends" and , therefore, "called into doubt the existence of any 
causal relationship".780 Japan avers that its arguments in support of this claim relied on the 
Appellate  Body's findings regarding  the relevance of conditions of competition or correlation among 
trends when drawing inferences about causation in trade remedy cases.781 
5.290.   Korea, for its part, submits that, " [o]ther than a mere assertion about the Panel's alleged 
'misinterpretation' of the Appellate  Body guidance, Japan does not develop any legal arguments with 
respect to the Panel's analysis."782 Korea notes that Japan argues that the Panel "improperly refused 
to address the lack of correlation", but this, according to Korea, suggests that Jap an should have 
brought a claim under Article  11 of the DSU.783 
5.291.   We recall that the analysis under Article  3.5 concerns the demonstration of "the causal 
relationship between subject imports  and injury  to the domestic industry".784 This demonstration 
shall be bas ed on "an  examination of all relevant evidence before the authorities". We agree  with 
the Panel that evidence that does not fall squarely within the parameters of Articles  3.2 and 3.4 may 
nevertheless be relevant and persuasive with respect to whether a ca usal relationship can be 
demonstrated under Article  3.5.785 A coincidence in time between upward trends in imports and a 
decline in the performance indicators of the domestic industry could be evidence of the existence of 
a causal link between increasing imp orts and material injury to the domestic industry.786 However, 
while such a coincidence , by itself , cannot prove causation, its absence would create serious doubts 
as to the existence of a causal link and would require a very compelling analysis of why causa tion is 
still present.787 Thus, the existence of a correlation, though indicative, is by no means dispositive of 
the existence of a causal link. Moreover, a  lack of correlation does not preclude a finding that a 
causal link exists, provided that a very compe lling explanation is provided.  
                                                
773 Panel  Report, para.  7.351.  
774 Panel  Report, paras.  7.353 and 7.356.  
775 Panel  Report, paras.  7.353 and 7.356.  
776 Panel  Report, para.  7.360.  
777 Panel  Report, para.  7.361.  
778 Japan's appellant's submission, para.  299 (referring to Panel  Report, paras.  7.353 and 7.356).  
779 Japan's appellant's submission, para.  299. 
780 Japan's appellant's submission, para.  300. (fn  omitted)  
781 Japan's appellant's submission, para.  299 (referring to  Appellate  Body Reports, US – Tyres (China) , 
para. 192; Argentina – Footwear (EC) , para.  144; Panel  Report, China – X-Ray Equipment , 
paras.  7.239 -7.248).  
782 Korea's appellee's submission, para.  449 (quoting Japan's appellant's submission, para.  299).  
783 Korea's appellee's submission, para.  449 (quoting Japan's appellant's submission, para.  299).  
784 Appellate  Body Report, China – GOES , para.  147. (emphasis origi nal) 
785 Panel  Report, para.  7.248.  
786 Appellate  Body Report, US – Tyres (China) , para.  192. 
787 See Appellate  Body Report, Argentina – Footwear (EC) , para.  144. 
 WT/DS504/AB/R  
 
- 94 - 
 
  5.292.   That said, with respect to the alleged lack of correlation in volume trends, the Panel noted 
that Japan contended that the existence of any causal relationship between the dumped imports and 
the alleged injury was undermined because: (i) the volume and the market share of the dumped 
imports decreased from 2010 to 2012 (i.e. during the first two years of the three -year period of 
trend analysis); and (ii) the domestic industry's market share remained stable in 2013 as compared 
with 2010.788 In the context of Japan's "independent" causation claim, the Panel reviewed and 
rejected these two  effectively  identical arguments advanced by Japan in support of its allegation 
that certain flaws in the KTC's analysis of the volume of dumped im ports "independently" 
undermined its causation determination.789 On the basis of the same considerations, the Panel 
dismissed these arguments in the context of the present claim.790  
5.293.   We have considered above that, in addressing Japan's volume -related arguments  in the 
context of claim 6, the Panel reviewed the requirements under Article  3.2, first sentence, as opposed 
to those under Article  3.5. We have explained that, in reviewing Japan's claim 6, the Panel effectively 
incorporated the requirements of Article  3.2, first sentence, rather than properly applying the 
requirements set out in Article  3.5. As further discussed above, in reviewing a claim under 
Article  3.5, a panel is not called upon to revisit the question whether each of the interlinked 
compo nents of this determination, such as the investigating authority's volume analysis, is itself 
consistent with the applicable requirements set out in Article  3.2. Given that the Panel relied on the 
same considerations in rejecting Japan's arguments concerni ng the lack of correlation in volume 
trends in the context of the causation claim at issue (claim 4), we find the Panel's finding in this 
regard to be in error.  
5.294.   With respect to price trends, Japan submits that, whether measured based on simple 
averages or  the price fluctuation index method, prices followed very different trends. From 2011 
to 2012, subject import prices increased while domestic prices decreased, whereas from 2012 
to 2013, subject import prices fell sharply, but domestic prices fell only sli ghtly.791 These diverging 
price trends, according to Japan, did not suggest the necessary causal relationship.792 
5.295.   In response, Korea submits that the KTC considered the development in prices of both the 
dumped imports and the domestic like products in a dynami c manner over the entire POI, 
year-by-year and end -point to end -point, using average import and resale prices as well as a price 
fluctuation index.793 Korea contends that, on the basis of this comprehensive analysis, the KTC 
observed strong indications of pr ice effects  by the dumped imports on domestic prices throughout 
the entire POI, including in 2012 and 2013.794 Korea also submits that, for these last two years of 
the POI, there were no "widely diverging" price trends since, for both dumped and domestic lik e 
products, average prices effectively stagnated in 2012 and decreased in 2013.795 Korea therefore 
considers that Japan has failed to develop any legal argument about why the Panel's conclusions 
and reasoning were in error.796 
5.296.   We note that , in the context of t he present causation claim (claim 4), the Panel stated that 
"Japan argues that the lack of parallelism between dumped import prices and domestic like product 
prices does not support the existence of a causal relationship between the dumped imports and the 
injury allegedly suffered by the domestic industry."797 In particular, the Panel noted that Japan 
argued that:  (i) dumped import prices increased from 2011 to 2012 while domestic like product 
prices decreased; and (ii) dumped import prices fell sharply from 2012 to 2013 whereas domestic 
like product prices decreased only slightly.798 The Panel considered that Japan's arguments in 
support of this aspect of the causation claim at issue are identical to its price -effects -related 
                                                
788 Panel  Report, para.  7.352.  
789 Panel  Report, paras.  7.251 and 7.258. See also section 5.3.4.1.2.1 a bove.  
790 Panel  Report, para.  7.353.  
791 Japan's appellant's submission, para.  303. 
792 Japan's appellant's submission, para.  303. 
793 Korea's appellee's submission, para.  299 (referring to Korea's first written submission to the Panel, 
paras.  77-92 and 97 -112).  
794 Korea's appellee's submission, para.  299. 
795 Korea's appellee's submission, para.  299. 
796 Korea's appellee's submission, para.  455. 
797 Panel  Report, para.  7.355.  
798 Panel  Report, para.  7.355.  
 WT/DS504/AB/R  
 
- 95 - 
 
  arguments under claim 6.799 The Panel  recalled that, in the context of claim 6, it had found that 
Japan failed to demonstrate that the Korean investigating authorities acted inconsistently with 
Article  3.5 with respect to their consideration of the absence of parallel price trends . Based on t he 
same considerations, the Panel concluded that, in the causation claim at issue (claim 4), Japan ha d 
failed to establish that insufficient price correlation suffice d to demonstrate that a reasonable and 
unbiased investigating authority could not have pro perly found the required causal relationship 
between the dumped imports and injury to the domestic industry in light of the facts and arguments 
that were before the KTC.800 
5.297.   We recall that we have considered above that the Panel's analysis of the diverging tr ends in 
the context of Japan's claim 6 focused on whether there was a competitive relationship between 
dumped imports and domestic like products despite diverging price trends, and whether the 
diverging price trends could, in and of themselves, undermine t he causal relationship under 
Article  3.5. Accordingly, we have found that the Panel's analysis reviewed the Korean investigating 
authorities' examination of the relationship  between the prices of the dumped imports and those of 
the domestic like product, in order to ascertain the effects of the former on the latter, which, as 
explained, corresponds to an examination properly conducted pursuant to Article  3.2, second 
sentence. We have also considered that the Panel's conclusion that the diverging price trends do 
not, in and of themselves, demonstrate that the KTC's determination of a causal relationship is 
inconsistent with Articles  3.1 and 3.5 was a mere consequence of its anal ysis as to whether the 
KTC's price -effects analyses were objective and reasoned, and compatible with the requirements set 
out in Article  3.2, second sentence. Accordingly, we have found above that the Panel's analysis of 
the issue of diverging price trends  was based on the applicable requirements under Article  3.2, rather 
than those concerning causation under Article  3.5, even though it was addressing a claim under the 
latter provision . Given that the Panel relied on the same considerations in rejecting Jap an's 
arguments concerning the lack of correlation in price trends in the context of the causation claim at 
issue (claim  4), we find the Panel's finding in this regard to be in error.  
5.298.   Finally, concerning profit trends, Japan contends that "there was also i nsufficient correlation 
in the trends regarding the domestic industry's condition to 'demonstrate' a causal relationship."801 
Japan points out that the domestic industry's operating losses in 2012 and 2013 show that 
"regardless of whether subject imports had  increasing or decreasing volumes, or whether subject 
imports had increasing or decreasing average prices, the domestic industry still lost money."802 
According to Japan, "these operating losses regardless of the presence of subject imports did not 
suggest t he necessary causal relationship."803 Japan argues that the Panel embraced, without any 
discussion, a logically inconsistent KTC explanation of profit trends.804 Japan avers that the Panel 
pointed to the KTC's statements that domestic -industry profits fell in 2012 due to increased 
competition with imports, but "in 2012 the volume of imports was down, the market share of imports 
was down, and the average prices of imports were up."805 Therefore, Japan fails to see any basis for 
"the assertion about 'increased comp etition' with imports in 2012, given these other facts that the 
KTC – and then the Panel – conveniently ignored".806 
5.299.   Korea, for its part, submits that "it is unclear what the legal error of the Panel would have 
been."807 Korea submits that "Japan neglects to m ention [the] KTC's well -grounded evaluation of 
the domestic industry's operating loss."808 Korea points out that the KTC specifically acknowledged 
that the domestic industry's operating loss persisted from 2010 to 2012, but nonetheless found that 
"[t]he dete rioration of the operating profit in 2012, after improving in 2011, was a result of the price 
reduction of the like product and the increase in the operating cost in response to the competition 
with the dumped products."809 Korea contends that the KTC adequa tely evaluated the operating loss 
                                                
799 Panel  Report, para.  7.356.  
800 Panel  Report, para.  7.356.  
801 Japan's  appellant's submission, para.  305. 
802 Japan's appellant's submission, para.  305. 
803 Japan's appellant's submission, para.  305. 
804 Japan's appellant's submission, para.  307. 
805 Japan's appellant's submission, para.  307. (fns  omitted)  
806 Japan's appellant's submission, para.  307. 
807 Korea's appellee's submission, para.  457. 
808 Korea's appellee's submission, para.  459. 
809 Korea's appellee's submission, para.  459 (quoting KTC's Final R esolution (Panel Exhibit KOR -1b 
(BCI)) , p. 23). 
 WT/DS504/AB/R  
 
- 96 - 
 
  of the domestic industry within the context of its overall injury determination rather than in isolation, 
and concluded that the aggravation of the operating loss was attributable to the effect of the dumped 
imports.810 
5.300.   Japan's argument, in our view, appears to mischaracterize the KTC's findings. The KTC did 
not state that it found "increased" competition  in 2012 . Rather, as the Panel noted, the KTC 
acknowledged that the domestic industry's operating loss worsened from 2011 t o 2012, at a time 
when dumped import prices increased and their volume and market share declined.811 However, the 
Panel noted that the KTC explained that one of the reasons for the increased operating loss ratio 
was due to the increase of operating costs "in  response to the competition with the dumped 
imports".812 The Panel took into account these statements by the KTC in considering Japan's 
arguments, noting in particular that, according to the KTC, the worsening operating loss "was a 
result not only of the de crease in domestic like product prices (which it elsewhere in its report 
attributed to the effect of dumped imports), but also of the increase of operating costs".813  
5.301.   Therefore, contrary to Japan's argument, neither the Panel nor the KTC ignored the alleged  
lack of correlation between the domestic -industry profit, dumped import prices, and the volume and 
market share of the dumped imports. The Panel was mindful of the fact that the domestic industry's 
operating loss worsened from 2011 to 2012 when the averag e price of the dumped imports 
increased, and their volume and market share decreased. However, at the same time, the Panel 
found it reasonable for the Korean investigation authorities to consider that "[t]he average price of 
the dumped products increased i n 2011 and 2012 not because their actual sales prices rose but 
mainly because the product composition was changed [such] that they were mainly composed of 
high-priced products."814 As we see it, therefore, the Panel did not err in stating that "the KTC 's 
consideration of the relationship between the operating losses of the domestic industry during the 
entire POI and the dumped imports is reasonable and grounded in the underlying facts."815 
Accordingly, we reject Japan's argument that " [t]he KTC ['s] discussi on of this … issue  … was 
deficient", or that "the Panel should have recognized this deficiency."816 To that extent, we do not 
see any error in the Panel's finding.  
5.3.4.2.2   Conclusion with respect to claim 4  
5.302.   In light of the foregoing considerations, we uphold  the Pa nel's finding, in paragraph 8.3.b of 
the Panel  Report , that Japan has not demonstrated that the Korean investigating authorities acted 
inconsistently with Articles  3.1 and 3.5 of the Anti -Dumping Agreement  with respect to their 
conclusion that the dumped i mports, through the effects of dumping, were causing injury to the 
domestic industry, insofar as Japan's argument regarding insufficient correlation between dumped 
imports and trends in domestic -industry profits is concerned.  
5.3.5   Whether the Appellate  Body  can complete the legal analysis under Articles  3.1, 3.2, 
and 3.4 of the Anti -Dumping  Agreement  
5.303.   We now turn to examine Japan's request that the Appellate  Body complete the legal analysis 
with respect to Japan's claims under Articles  3.1, 3.2, and 3.4 of the A nti-Dumping  Agreement and 
find that the Korean investigating authorities acted inconsistently with these provisions in the 
anti-dumping investigation at issue.  
5.304.   To recall, the Panel found that Japan's volume and price -related claims under Articles  3.1 
and 3.2 were outside its terms of reference.817 With respect to Japan's claim under Articles  3.1 
and 3.4 regarding the impact of the dumped imports on the state of the domestic i ndustry, the Panel 
found that Japan's claim is limited to the allegation that the KTC failed to evaluate two of the specific 
factors listed in Article  3.4, namely  the ability to raise capital or investments and the magnitude of 
                                                
810 Korea's appellee's submission, para.  460. 
811 Panel  Report, para.  7.358.  
812 Panel  Report, para.  7.358.  
813 Panel  Report, para.  7.358.  
814 Panel  Report, para.  7.279 (quoting OTI's Final Report (Panel Exhibit KOR -2b (BCI)) , p. 58). 
815 Panel  Report, para.  7.360.  
816 Japan's appellant's submission, para.  308. 
817 Panel  Report, paras.  7.94 and 7.131.  
 WT/DS504/AB/R  
 
- 97 - 
 
  the margin of dumping, and t hat all other "allegations" of inconsistency with Article  3.4 were outside 
its terms of reference.818 With regard to those claims and "allegations" excluded from its terms of 
reference, the Panel stated that it would neither consider them further nor resolve  them.819 
5.305.   We recall that,  in light of the limitation imposed by Article  17.6 of the DSU, the 
Appellate  Body has completed the legal analysis with "a view to facilitating the prompt settlement 
and effective resolution of the dispute … when sufficient factual findings by the panel and undisputed 
facts on the panel record allowed it to do so".820 However, in addition to the lack of factual findings 
by the panel and undisputed facts on the panel record, the Appellate  Body has declined to complete 
the legal analysis  in view of due process considerations821, for example, where the panel had not 
examined a claim at all822, or where there had not been a full exploration of the issues823 or scrutiny 
of the relevant evidence by the panel.824 
5.306.   With these considerations in mind, we turn to address Japan's request for completing the 
legal analysis, starting with whether the Korean investigating authorities acted inconsistently with 
Articles  3.1 and 3.2 of the Anti -Dumping  Agreement regarding their  consideration of the volume of 
dumped imports.  
5.3.5.1   Whether the Korean investigating authorities acted inconsistently with 
Articles  3.1 and 3.2 of the Anti -Dumping  Agreement in their consideration of the volume 
of dumped imports  
5.307.   As noted, for each of the claims that the Panel found to be outside its terms of reference, 
the Panel  Report  contains a section entitled "Relevant facts" that immediately follows  the summaries 
of the parties' arguments and precedes the Panel's legal analysis regardi ng its terms of reference 
under Article  6.2 of the DSU. The Panel proceeded in this manner with respect to Japan's claim under  
Articles  3.1 and 3.2 of the Anti -Dumping  Agreement regarding the Korean investigating authorities' 
consideration of import volume s.825 The Panel sourced the "Relevant facts" from the KTC's Final 
Resolution826 and the OTI's Final Report827, which form part of the Panel record. In addition to setting 
out the relevant passages from the KTC's Final Resolution and the OTI's Final Report, the P anel 
stated:  
In the underlying investigation, the  KTC considered whether there was a significant 
increase in dumped imports in absolute terms, relative to domestic consumption, and 
relative to domestic production. The KTC found that, from each of these thr ee 
perspectives, the volume of dumped imports decreased from 2010 to 2012, and then 
increased sharply from 2012 to 2013. With respect to the trends in market share, the 
KTC found that the decreasing trend from 2010 to 2012, reversed into a sharp increase 
in 2013; on an end -point to end -point basis from 2010 to 2013, however, the market 
share of the dumped imports decreased. In its ultimate determination, the KTC relied 
upon the significant increase in dumped imports from 2012 to 2013 as a factor in 
suppress ing and depressing domestic prices, which in turn [led] to a deterioration of 
the state of the domestic industry.828 
                                                
818 Panel  Report, para.  7.175.  
819 Panel  Report, paras . 7.94, 7.131, and 7.175.  
820 Appellate  Body Report, Colombia – Textiles , para.  5.30. (fns  omitted)  
821 See e.g. Appellate  Body Reports, Russia – Commercial Vehicles , para.  5.141 (referring to 
Appellate  Body Reports, Canada – Renewable Energy / Canada – Feed-in Tariff Program , para.  5.224; 
EC ‒ Seal Products , paras.  5.63 and 5.69; US – Anti-Dumping Methodologies (China) , para.  5.178); 
EC – Export Subsidies on Sugar , para.  339; Peru – Agricultural Products , para.  5.157.  
822 See e.g. Appellate  Body Report, Russia – Pigs (EU) , para.  5.141 (referring to Appellate  Body Reports, 
EC – Poultry , para.  107; EC – Asbestos , paras.  79 and 82; US – Section 211 Appropriations Act , para.  343; 
EC – Export Subsidies on Sugar , para.  337).  
823 See e.g. Appellate  Body Reports, EC – Asbestos, para.  81; EC and certain member States – Large 
Civil Aircraft (Article  21.5 – US), para.  5.721; EC ‒ Seal Products , para.  5.69; Russia – Commercial Vehicles , 
para. 5.141.  
824 See e.g. Appellate  Body Report, US – Countervailing Measures (China) , para.  4.157.  
825 Panel Report, paras.  7.81-7.84. 
826 KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)).  
827 OTI's Final Report (Panel Exhibit KOR -2b (BCI)).  
828 Panel  Report, para.  7.81. 
 WT/DS504/AB/R  
 
- 98 - 
 
  5.308.   Japan submits that this part of the Panel  Report  "sets forth all of the key facts needed to 
resolve this claim".829 Japan  asserts that the KTC "improperly" found a "significant increase" in the 
dumped imports even though the volume of such imports actually fell in two of the three years 
during the POI , and increased slightly  on an absolute basis and decrease d on a relative basis over 
the POI.830 Japan also submits that "[t]his claim is also closely related to the claims the Panel did 
address."831 In particular, Japan refers to "the Panel's discussion of the volume -related aspects of 
the causation claim".832 
5.309.   In respo nse, Korea submits that the Panel did not undertake any analysis and did not make 
any factual findings under Articles  3.1 and 3.2. According to Korea, "[i]n paragraphs 7.81 to 7.84  
[of its Report] , the Panel merely summarized some but clearly not all of th e 'relevant facts'."833 Thus, 
Korea avers that "[g]iven the absence  of any legal or factual findings, let alone sufficient factual 
findings, there is no basis for the Appellate  Body to 'complete' the analysis since no analysis was 
ever initiated."834 
5.310.   Article  3.2 of the Anti -Dumping  Agreement instructs an investigating authority "to 'consider' 
a series of specific inquiries".835 With regard to the volume of subject imports, an investigating 
authority  must consider whether there has been a significant increase in d umped imports in absolute 
terms or relative to domestic production or consumption. The Appellate  Body has noted that 
Article  3.2 does not set out "a specific  methodology that investigating authorities are required to 
follow when calculating the volume of ' dumped imports' ."836 However, "whatever methodology 
investigating authorities choose for determining the volume of dumped imports", it must ensure that 
the determination of injury is based on "positive evidence" and an "objective examination" of the 
volume o f dumped imports.837 
5.311.   We recall that the Panel addressed the following arguments by Japan regarding the Korean 
investigating authorities' consideration of import volumes in the context of Japan's claim 6 under 
Articles  3.1 and 3.5 of the Anti -Dumping  Agreemen t. The Panel reviewed Japan's arguments that 
the KTC's causation determination  was undermined because: (i) the volume of dumped imports 
decreased in two years of the three -year period of trend analysis; and (ii) the volume of dumped 
imports increased only modestly in absolute terms and decreased in terms of market share in 2013 
compared with 2010.838 The Panel found that the KTC did not ignore the decline in dumped imports 
from 2010 to 2012. The Panel did not consider it unreasonable for the KT C to have relied on the 
78.9% increase in the dumped imports from 2012 to 2013, the most recent period, which was the 
same year in which dumping was found.839 The Panel also found that the fact that the market share 
of dumped imports did not increase on an e nd-point to end -point basis from 2010 to 2013 does not, 
in and of itself, preclude the conclusion reached by the KTC "that the increase in the absolute volume 
of imports, and in particular the significant increase from 2012 to 2013, combined with the price  
effects of the dumped imports, caused injury to the domestic industry" .840  
5.312.   We note that certain arguments made by Japan in support of its present claim under 
Articles  3.1 and 3.2 are identical to those addressed by the Panel as described in the preceding 
paragraph . Japan argues that the KTC acted inconsistently with Articles  3.1 and 3.2 by "improperly" 
finding a "significant increase" in subject imports, even though the volume of such imports "actually 
fell in two out of three of the comparison periods, and  ended the overall period up only slightly on 
an absolute basis and actually down on a relative basis".841 Thus, like its argument in the context of 
                                                
829 Japan's appellant's submission, para.  128. 
830 Japan's appellant's submission, para.  137 (referring to Japan's first written submission to the Panel, 
paras.  128-131).  
831 Japan's appellant's submission, para.  129. 
832 Japan's appellant's submission, para.  130 (referring to Panel  Report, paras.  7.250 -7.258).  
833 Korea's appellee's submission, para.  188. 
834 Korea's appellee's submission, para.  188. 
835 Appellate  Body Report, China – GOES , para.  129. 
836 Appellate  Body Report, EC – Bed Linen (Article  21.5 – India) , para.  113. (emphasis original)  
837 Appellate  Body Report, EC – Bed Linen (Article  21.5 – India) , para.  113. 
838 Panel  Report, para.  7.251.  
839 Panel Report, para.  7.254.  
840 Panel  Report, para.  7.257.  
841 Japan's appellant's submission, para.  137 (referring to Japan's first written submission to t he Panel, 
paras.  128-131).  
 WT/DS504/AB/R  
 
- 99 - 
 
  claim 6, Japan focuses on the alleged failure by the KTC to take into account the decrease of import 
volumes in absolute terms in the first two years of the POI, and the decrease of import volumes in 
relative terms, in finding that there was a "significant increase" in the volume of imports. However, 
in our view, the Panel did not accept the KTC's findings on its  face. Rather, the Panel critically 
examined the KTC's findings concerning the volume of dumped imports. We  do not consider that, 
for the Panel , the year in which dumping is found  would  suffice , without more,  for the purposes of 
assessing injury. Nor do we  understand the Panel to have a priori  excluded from its consideration 
relevant evidence and information pertaining to the period prior to 2012. To the contrary, the Panel 
examined and found that "the KTC did not ignore the decline in dumped imports from 2 010 to 2012" 
but "explained that , despite the decrease in imports in the first two years, there was a significant 
reversal in the trend from 2012 to 2013" .842 For the reasons set out in section 5.3.4.1.2.1 , we have 
explained that the Panel's above analysis a nd findings properly reviewed the Korean investigating 
authorities' analysis pursuant to the  requirements set out in Article  3.2, first sentence, as opposed 
to those under Article  3.5. In so doing, we do not find the Panel to have erred in applying the 
requirements contained in Article  3.2, first sentence , when reviewing the KTC's assessment of the 
volume of dumped imports. Indeed, in reviewing Japan's argument that the market share  of dumped 
imports decreased on an end -point to end-point basis, the Panel correctly relied on the requirements 
set out in Article  3.2, first sentence.  
5.313.   However, we note that Japan's  arguments in the context of its present claim under 
Articles  3.1 and  3.2 concerning the volume of dumped imports and regarding which it requests us 
to complete the legal analysis, encompass broader considerations than those contained in the above 
findings by the Panel, namely that: (i) the KTC improperly assumed a competitive r elationship 
between domestic like products and subject imports; and (ii) the KTC improperly found a "significant 
increase" in subject imports without examining whether the increased imports actually replaced 
domestic like products through market competitio n.843  
5.314.   Turning to the first of these arguments, we note that Japan asserts that the KTC acted 
inconsistently with Articles  3.1 and 3.2 in failing to make "an objective examination of whether 
subject imports replaced domestic like products, so as to support a  determination that the increase 
in import volume could objectively  be described as 'significant' ."844 Japan also submits that the 
"findings" the OTI made on the issue of displacement were "vague and anecdotal"845 and that these 
findings merely compared the price levels of the subject imports and domestic like products, without 
taking into consideration "the margins of dumping at issue viewed in light of the competitive 
relationship (or lack thereof) between subject imports and domestic products" .846  
5.315.   In response, Korea submits that " Article  3.2 requires a quantitative examination of the 
volume of dumped imports as part of a more comprehensive injury analysis."847 According to Korea, 
Japan's interpretation of what is required of investigating authorit ies under Article  3.2 with respect 
to considering the volume of dumped imports goes "far beyond the text of the provision as 
interpreted and applied in the jurisprudence".848 Korea further argues that, in any event, the KTC in 
fact examined both "the increas e in volume and the loss of market share of the domestic like product 
and thus established that in this particular case there was such displacement".849 
5.316.   We note that this argument was not raised by Japan before the Panel in the context of 
claim  6. Nor do we find anything in the "Relevant facts" section of the Panel  Report  that indicates 
that the Panel explored with the parties this issue of "replacement" raised by Japan. In this  section, 
the Panel set out excerpts from the KTC's Final Resolution.850 Our review of the se excerpts shows 
that the KTC examined the market share of both sets of products as part of the examination into 
the increase of imported products  in relative terms . However, these passages, in and of themselves, 
                                                
842 Panel  Report, para.  7.254.  
843 Japan's appellant's submission, para.  137 (referring to Japan's first written submission to the Panel, 
paras.  132-133 and 137 -141; second written submission to the Panel, paras.  98-112).  
844 Japan's a ppellant's submission, para.  141. (emphasis original)  
845 Japan's appellant's submission, para.  142. 
846 Japan's appellant's submission, para.  142 (referring to Japan's second written submission to the 
Panel, paras.  99-105).  
847 Korea's appellee's submission, pa ra. 208. 
848 Korea's appellee's submission, para.  208. 
849 Korea's appellee's submission, para.  210. 
850 Panel  Report, para.  7.82 (quoting KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)), p.  14). 
 WT/DS504/AB/R  
 
- 100 - 
 
  do not show whether the KTC found "replacement " of domestic like products by dumped imports in 
the manner asserted by Japan. Importantly, we note that Japan concedes that the Panel "did not 
address at all" Japan's point about the Korean investigating authorities' failure to show "any 
replace ment of domestic shipments by imports".851 Moreover, the Panel did not sufficiently explore 
the issue whether Article  3.2, first sentence, requires a showing that subject imports have replaced 
domestic like products. We also note that, while Japan characteri zes the OTI's findings on "the issue 
of displacement [as] vague and anecdotal"852, Korea contends that the KTC "in fact considered 
whether dumped imports displaced domestic sales by examining both volumes and market share 
developments".853 Japan, however, subm its that, in so doing, "[t]he Korean [investigating] 
authorities … presented only a numerical comparison of the volume, without examining market 
interactions by considering the competitive relationship between the dumped imports and domestic 
like products in conjunction with the margins of dumping."854 As we see it, the parties, therefore, 
are in clear disagreement about the underlying facts themselves, i.e. the extent to which the Korean 
investigatin g authorities addressed the issue of replacement in their analysis of the volume of 
dumped imports . We note that  the Panel made no findings  in this regard .  
5.317.   Finally, Japan contends that "[t]he KTC also failed to consider the existence of a competitive 
relationship between  the dumped imports and the domestic like product, in conjunction with the 
margins of dumping."855 Japan submits that , in addition to "[t]he diverging volume and market share 
trends",  "[t]he consistent and significant overselling, the divergin g price trends, and the differing 
magnitudes of price changes were all consistent with the lack of meaningful competitive 
relationship ."856 
5.318.   Korea, for its part, submits that Japan does not develop this assertion.857 Korea avers that 
the Appellate  Body should  not engage in an alleged completion of the legal analysis when "the 
appellant does not develop its claims in any way, fails to link the claim to the allegedly undisputed 
facts on the record", and "simply makes bare assertions without a proper legal analysis  of why a 
detailed analysis of the competitive relationship between different producers would be required for 
an analysis of the increase in the volume of imports".858 
5.319.   We note that Japan concedes that the Panel "did not address at all" the point about the 
Korean investigating  authorities' failure to show "any evidence of a competitive relationship" in the 
context of their consideration of the volume of dumped imports.859 Thus, the Panel did not explore 
with the parties the question whether the Korean investigat ing authorities were required, in the first 
place, to consider the competitive relationship between dumped imports and domestic like product 
"in conjunction with the margins of dumping" in its analysis of significant increase in volume of 
dumped imports un der Article  3.2. Furthermore, the "Relevant facts" section does not contain any 
indication as to whether the Korean investigating authorities analysed the issue raised by Japan in 
the context of their consideration of the volume of dumped imports .860 Nor is such an analysis clearly 
                                                
851 Japan's appellant's submission, para.  147. 
852 Japan's appella nt's submission, para.  142. 
853 Korea's appellee's submission, para.  189 (referring to Korea's response to Panel question No. 37).  
854 Japan's appellant's submission, para.  143. 
855 Japan's appellant's submission, para.  139 (referring to Japan's first written submission to the Panel, 
paras.  132-133; second written submission to the Panel, paras.  106-108).  
856 Japan's appellant's submission, para.  139 (referring to Japan's first written  submission to the Panel, 
paras.  74-83). 
857 Korea's appellee's submission, para.  204. 
858 Korea's appellee's submission, para.  204. 
859 Japan's appellant's submission, para.  147. 
860 We recall that in the context of its price -effects analysis, the KTC considered the competition 
between dumped imports and domestic like products, which was examined by the Panel in the context of 
Japan's argument concerning diverging price trends under claim 6, and which we have reviewed above in 
section  5.3.4.1.2.2.  
 WT/DS504/AB/R  
 
- 101 - 
 
  discernible from our review of the KTC's Final Resolution861 and the OTI's Final Report862 that form 
part of the Panel record.863  
5.320.   Confronted with these circumstances, completion of the legal analysis regarding whether the 
KTC (i) improperly assumed a competitive relationship between domestic like products and subject 
imports ; and (ii) improperly found a "significant increase" in subject imports without examining the 
question of replacement  is hindered by the absence of relevant fac tual findings on these issues, 
sufficient undisputed facts on the Panel record  and a sufficient exploration of these issues by the 
Panel. Thus, engaging in the completion exercise would require us to "review and consider evidence 
and arguments that … were not sufficiently addressed by the Panel or sufficiently explored and 
developed before the Panel".864 In light of the foregoing considerations, we find ourselves unable to 
complete the legal analysis as to whether the Korean measures are inconsistent with Articles 3.1 
and 3.2 of the Anti -Dumping Agreement  with respect to the Korean investigating authorities' 
consideration of the volume of the dumped imports .865 
5.3.5.2   Whether the Korean investigating authorities acted inconsistently with 
Articles  3.1 and 3.2 of the Ant i-Dumping  Agreement in their consideration of price effects  
5.321.   Japan asserts that the Korean investigating authorities failed to meet their obligations under 
Articles  3.1 and 3.2 of the Anti -Dumping  Agreement because: (i) the KTC failed to consider the 
implic ations of the overselling by the dumped imports; (ii) the KTC "largely ignored" the diverging 
price trends; (iii) the KTC "ignored the absence of any evidence of price suppression in 2011 
and 2012, and drew improper conclusions from the limited evidence in  2013"; and (iv) the KTC failed 
to ensure the price comparability by failing to demonstrate "any actual and specific competition " 
between the dumped imports and domestic like products.866 Japan contends that the Panel's findings 
under Article  3.5 of the Anti -Dumping Agreement that the Korean investigating authorities failed to 
ensure price comparability and adequately take into account the overselling by the dumped imports 
in their examination of causation  "demonstrate that the [Korean investigating authoriti es'] 
determination did not properly assess the 'effect of the dumped imports on prices in the domestic 
market' as required by Articles  3.1 and 3.2".867 
5.322.   In response, Korea argues that the Appellate  Body is not in a position to complete the legal 
analysis in the absence of any legal or factual findings and undisputed facts on the record regarding 
Japan's claim under Articles  3.1 and  3.2.868 Regarding the merits of Japan's claim, Korea maintains 
that the Kor ean investigating authorities considered the implications  of the price overselling by the 
dumped imports869 and diverging price trends.870 Korea disputes Japan's contention that the Korean 
investigating authorities'  consideration of price suppression was based  on limited evidence from 
2013871 and that the y did not demonstrate a competitive relationship between the dumped imports 
and domestic like products.872 Korea also contends that "the Korean [investigating] authorities 
properly ensured price comparability betwe en like product and the dumped imports."873 Regarding 
Japan's reliance on the Panel's findings concerning Japan's "independent" causation claim, Korea 
argues that the completion of the legal analysis in this regard is prevented by the fact that the Panel 
                                                
861 KTC's Final Re solution (Panel Exhibit KOR -1b (BCI)) , pp. 14-17. 
862 OTI's Final Report (Panel Exhibit KOR -2b (BCI)), pp.  46-51. 
863 We recall that in the context of Japan's argument regarding diverging price trends with respect to its 
"independent" causation claim under Articles  3.1 and 3.5 of the Anti -Dumping Agreement, we have agreed 
with the Panel's analysis that focused on whether  there was a competitive relationship between dumped 
imports and domestic like products. See section 5.3.4.1.2.2 above.  
864 Appellate  Body Report, EC and certain member States – Large Civil Aircraft (Article  21.5 – US), 
para. 5.749.  
865 Japan's appellant's sub mission, para.  152. 
866 Japan's appellant's submission, para.  186. 
867 Japan's appellant's submission, para.  202. 
868 Korea's appellee's submission, para.  256. In Korea's view, Japan's request for completing the legal 
analysis would effectively require the Appel late Body "to play the role of the Panel both in terms of the facts 
and in terms of the application of the law to the facts". (Ibid., para.  257) 
869 Korea's appellee's submission, paras.  291-297. 
870 Korea's appellee's submission, paras.  298-307. 
871 Korea's app ellee's submission, paras.  308-310. 
872 Korea's appellee's submission, paras.  311-319. 
873 Korea's appellee's submission, para.  314. 
 WT/DS504/AB/R  
 
- 102 - 
 
  made certain factual findings in its disposition of the price -effects -related claims under Article  3.5, 
which the parties dispute and are subject to appeal.874 
5.323.   The second sentence of Article  3.2 of the Anti -Dumping Agreement requires an investigating 
authority to consider whether the effect of such dumped imports on the prices of the domestic like 
products is to depress or suppress such prices or to undercut them to a significant degree. 
Article  3.2, second sentence, does not prescribe specific methodologies as to how an investigating 
authority is to consider whether there has been a significant price undercutting, price suppression, 
or price depression. Nor does Article  3.2, second sentence, expl icitly state whether an investigating 
authority must ensure comparability between the prices that are being compared. As noted  above , 
"a failure to ensure price comparability" cannot be considered to be consistent with the requirement 
under Article  3.1 tha t "a determination of injury be based on 'positive evidence' and involve an 
'objective examination' of, inter alia , the effect of subject imports on the prices of domestic like 
products".875 Accordingly, to the extent an investigating authority relies on pri ce comparisons in its 
consideration of price effects of subject imports, price comparability needs to be ensured. Thus, 
where an investigating authority fails to ensure price comparability in price comparisons between 
dumped imports and the domestic like p roduct, this undermines its findings of price effects under 
Article  3.2, to the extent that it relies on such price comparisons.876  
5.324.   With respect to the issue of price comparability, it is undisputed that in the present case "the 
KTC undertook price comparis ons" in finding that the dumped imports had price-suppressing 
and -depressing effects.877 We recall that, in the context of Japan's claim 6, the Panel found that 
"the KTC relied upon the price differentials in [ the] comparisons  [at issue]  in finding that dum ped 
imports had price suppressing and depressing effects on domestic prices , which in turn was one of 
the bases for its ultimate determination under Article  3.5."878 The Panel set out in a table what Korea  
referred to as a series of comparisons between the individual resale transaction prices of models of 
dumped imported valves and the average prices of corresponding models of the domestic like 
product reported in the OTI's Final Report. This table underlined those transactions in which dumped 
import prices t o certain customers were lower than the average domestic price for the corresponding 
model produced by the Korean producers.879 The Panel found that the listed transactions "took place 
on different dates and involved different quantities".880 The Panel observe d that, in general, the 
lower the quantity involved in a transaction, the higher the unit price of the dumped imported valve. 
The Panel took the view that, in light of the possible effect on the comparisons made, an unbiased 
and reasonable investigating au thority could not have properly compared these individual 
transaction prices with the average price of the corresponding model of the domestic like product 
without further consideration and explanation of the "relevance or significance " of these 
differences.881  
5.325.   As indicated above , while the Panel's analysis  was carried out in the context of Japan's 
claim  6, it was nonetheless in line with the requirements set out in Article  3.2, second sentence.882 
Indeed, the Panel's analysis of the issue of price comparability was properly conducted under 
Article  3.1 and Article  3.2, second sentence , and the Panel's finding that the Korean investigating 
authorities had to ensure price comparability in the price comparisons they undertook was 
compatible wit h the requirements of these provisions. As the Panel's finding indicate s, the Korean 
investigating authorities'  transaction -to-average comparison analysis was aimed at assessing 
whether the prices of dumped imports were lower than the prices of domestic li ke products. T he 
Korean investigating authorities considered that individual cases of dumped import resale prices for 
some models that were lower than average domestic prices and high -end domestic prices for 
corresponding models to certain customers  (i.e. individual instances of "underselling") led to price 
                                                
874 Korea's appellee's submission, para.  319. 
875 Appellate  Body Report, China – GOES , para.  200. 
876 See section 5.3.4.1.4 above.  
877 Panel  Report, para.  7.267.  
878 Panel  Report, para.  7.272. (emphasis added)  
879 Panel  Report, para.  7.270 and Table 1 (referring to OTI's Final Report (Panel Exhibit KOR -2b (BCI)), 
pp. 100-101).  
880 Panel  Report, para.  7.271.  
881 Panel  Report, para.  7.271.  
882 See se ction 5.3.4.1.4.2 above.  
 WT/DS504/AB/R  
 
- 103 - 
 
  suppression and price depression of the domestic like product.883 Price comparability thus became 
an important issue in the KTC's consideration of price effects since "the KTC relied upon the price 
differe ntials in these comparisons in finding that dumped imports had price suppressing and 
depressing effects on domestic prices ."884  
5.326.   The Panel found that the transactions "took place on different dates and involved different 
quantities" and rightly, in our view,  considered that an unbiased and reasonable investigating 
authority could not have properly compared these individual transaction prices with the average 
price of the corresponding model of the domestic like product without further consideration and 
explan ation of the "relevance or significance " of these differences.885 The Panel ultimately found that 
the evidence before it did not suggest that either the KTC or the OTI made any effort to consider 
differences or their potential consequences for price suppression and price depression  in the 
determination of material injury caused by dumped imports, thereby casting doubt on the validity 
of these price comparisons.886 In our view, these flaws that the Panel identified concern the 
objectivity and e videntiary foundation of the KTC's price suppression and price depression findings 
under Articles  3.1 and  3.2.887  
5.327.   For these reasons, we are able to complete the legal analysis to find that, as the Korean 
investigating authorities found price-suppressing and  -depressing effects of dumped imports based 
on the transaction -to-average price comparisons without ensuring price comparability, they acted 
inconsistently with Articles  3.1 and 3.2 of the Anti -Dumping Agreement.  
5.328.   Next, with respect  to the issue of price overselling, Japan argues that " [i]n finding the price 
effects of the dumped imports on the domestic like products, the KTC ignored … the significant 
overselling of the dumped imports."888  
5.329.   Korea responds that the KTC expressly addressed the fact that the av erage sales price of 
the dumped imports was higher than that of the like product but found that "this 'overselling' did 
not undermine the conclusion that the suppression and depression of domestic prices was a result 
of the dumped imports."889 
5.330.   We recall that the Korean investigating authorities relied on individual instances of 
"underselling" to address  the argument by the interested parties that the consistent overselling by 
dumped imports based on the average price precluded  a finding of price  suppression and price 
depression. In particular, "the KTC referred to the [ price-suppressing and -depressing ] effects of 
individual instances of … 'underselling' on 'the price of the like product'."890 As noted by the Panel in 
the section entitled "Relevant  facts", the KTC stated:  
The Commission finds that the dumped products suppressed price increases of the like 
product and caused decreases thereof, although the average sales price of the dumped 
products was higher than that of the like product.  
The avera ge sales price of the dumped products was higher due to their price 
differentiation in accordance with models, option details or customers, but it was found 
that the sales price of the dumped products was much lower than the average sales 
price in the case  of certain products or customers for which the degree of competition 
with the domestic industry was fierce, which had the effect of suppressing increases in 
the price of the like product or causing decreases thereof . It was investigated that SMC 
Korea … c onsistently expanded its sales organizations and used its dominant position to 
attract distribution agents or discourage defections of its distribution agents, and thus 
                                                
883 Panel  Report, para.  7.302 (referring to OTI's Final Report (Panel Exhibit KOR -2b (BCI)), pp.  100-101; 
Korea's response to Panel's question No. 88(b), para.  19; Record Data on the Dumped Imports' Individual 
Resale Transaction (Pan el Exhibit KOR -57 (BCI)) ). 
884 Panel  Report, para.  7.272. (emphasis added)  
885 Panel  Report, para.  7.271.  
886 Panel  Report, para.  7.271.  
887 See section 5.3.4.1.4.2 above.  
888 Japan's appellant's submission, para.  187. 
889 Korea's appellee's submission, para.  284. 
890 Panel  Report, para.  7.302.  
 WT/DS504/AB/R  
 
- 104 - 
 
  the domestic industry had to respond to such strengthened marketing activities of SMC 
Korea and become forced to decrease the sales price or refrain from increasing prices .891 
5.331.   The Panel, albeit in the context of Japan's claim 6, considered that "[t]his implie[d] that the 
KTC found [that] the [price-suppressing and -depressing ] effects of these  individual instance s were 
on domestic like product prices as a whole, and not only on the prices of certain models of the 
domestic like product."892 The Panel thus understood the Korean investigating authorities to have 
considered that individual cases of d umped import resale prices for some models that were lower 
than average domestic prices and high -end domestic prices for corresponding models to certain 
customers  (i.e. individual instances of "underselling") led to price suppression and price depression 
of the domestic like product.893 As we see it, the KTC relied on the evidence regarding the individual 
instances of "underselling" in order to respond to the interested parties' arguments concerning the 
existence of price overselling based on the average pric es of all the products. The KTC reached the 
conclusion that these individual instances of "underselling" had the effect of suppressing and 
depressing the prices  of domestic like product despite the overall overselling by the dumped imports. 
In response to Korea's argument that Panel Exhibit KOR -57 supported the KTC's conclusion, the 
Panel reviewed the said Exhibit in conjunction with the OTI's Final Report and the KTC's Final 
Resolution and found that the evidence did not show whether, and if so how, the Korean investigating 
authorities examined the extent to which prices of the domestic like product were affected by the 
individual instances of lower dumped import prices.894  
5.332.   Although the Panel made this finding in the context of Japan's claim 6,  for the reasons stated 
above , we have  considered that the Panel's analysis was nonetheless in line with the requirements 
set out in Article  3.1 and Article  3.2, second sentence. Indeed, the Panel's analysis of the issue of 
price overselling and the indivi dual instances of "underselling" was properly conducted under , and 
complied  with, the requirements of th ose provisions.895 Accordingly, we have explained that, 
although the Panel spoke of price suppression or depression of the domestic like product "as a 
whole", we do not consider the Panel to have imposed a legal requirement " to demonstrate how and 
to what extent underselling in certain competitive sales affected the prices of the domestic like 
product 'as a whole'".896 Rather, in the context of this case, the  Panel examined the KTC's 
determination and, on that basis, "[understood] the KTC [to have ] found [that] the effects of these 
individual instances were on domestic like product prices as a whole, and not only on the prices of 
certain models of the domestic  like product".897 However, the Panel found that an explanation and 
analysis of how and to what extent the prices of the domestic like product were affected was 
lacking.898 In our view, the above -mentioned flaws that the Panel identified concern the Korean 
investigating authorities' failure to conduct an objective examination based on positive evidence in 
their consideration of price suppression and price depression. As we have explained, in identifying 
the price-suppressing and  -depressing effects of the dumped imports, it was therefore incumbent 
upon the Korean investigating authorities to have provided an explanation and analysis of how and 
to what extent the prices of the domestic like product were affected in light of the consistent 
overselling by the dumped imports.899  
5.333.   Korea argues that the Panel made "certain factual findings on which its legal analysis [of the 
price effects in the context of the Korean investigating authorities' causation determination] was 
based which both sides contes t and dispute".900 We recall that, in section 5.3.4.1.5  above, we have 
addressed Korea's appeal that the Panel failed to make an objective assessment of the matter under 
Article  11 of the DSU and Article  17.6 of the Anti -Dumping  Agreement. In this context , we have 
rejected several arguments raised by Korea concerning alleged errors by the Panel in its assessment 
                                                
891 Panel  Report, para.  7.115 (quoting KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)), p.  19). 
(emphasis added by the Panel)  
892 Panel  Report, para.  7.302.  
893 Panel  Report, para.  7.302 (referring to OTI's Final Report (Panel Exh ibit KOR -2b (BCI)), pp.  100-101; 
Korea's response to Panel's question No. 88(b), para.  19; Record Data on the Dumped Imports' Individual 
Resale Transaction (Panel Exhibit KOR -57 (BCI)) ). 
894 Panel  Report, paras.  7.309 -7.310.  
895 See section 5.3.4.1.4.2 above.  
896 Korea's other appellant's submission, para.  222. 
897 Panel  Report, para.  7.302.  
898 Panel  Report, paras.  7.311 -7.313.  
899 See section 5.3.4.1.4.2 above.  
900 Korea's appellee's submission, para.  319. 
 WT/DS504/AB/R  
 
- 105 - 
 
  of the facts. For instance, we have rejected Korea's argument that the Panel created and applied 
"specific and excessively demanding requirements" th at must be met in an overselling situation 
insofar as it relates to the applicable requirements set out in Article  3.2 of the Anti -Dumping 
Agreement . Similarly, we  have rejected Korea's argument  regarding the Panel's treatment of Panel 
Exhibit KOR -57 and a greed with the Panel's reading of that Exhibit.901 Apart from those arguments, 
Korea does not identify any disputed factual findings with respect to the Panel's finding that the 
Korean investigating authorities failed to adequately take into account the cons istent overselling by 
the dumped imports. Rather, as Korea acknowledges, the KTC relied on the relevant price 
comparisons and individual instances of "underselling" to conclude that the average price overselling 
by the dumped imports "did not undermine [its] conclusion that the dumped imports suppressed 
and depressed the domestic price of the like product".902  
5.334.   For these reasons, we are able to complete the legal analysis and find that, in the absence 
of any explanation and analysis of how and to what exten t the prices of the domestic like product 
were affected in light of the consistent overselling by dumped imports when finding price suppression 
and price depression, the Korean investigating authorities acted inconsistently with Articles  3.1 and 
3.2 of the  Anti-Dumping Agreement.  
5.335.   With respect to diverging price trends, Japan contends that the KTC also "largely ignored" 
these "dramatically" diverging  price trends that strongly suggested the lack of interaction in the 
market between the price of the subject i mports and that of the domestic  like products.903 
5.336.   Korea, for its part, submits that the KTC considered the development in prices of both the 
dumped imports and the domestic like products in a dynamic manner over the entire POI, 
year-by-year and end -point to end-point, using average import and resale prices as well as a price 
fluctuation index.904 On the basis of this "comprehensive analysis", Korea contends that "[the] 
KTC observed strong indications of price effects  by the dumped imports on domestic prices 
throughout the entire POI, including in 2012 and 2013."905 
5.337.   We recall that , before the Panel,  Japan raised the same argument in support of claim 6 and 
contended that "these diverging price trends show that there was no market interaction between 
the dumped impor ts and the domestic like product", thus " undermining the KTC's price suppression 
and depression analyses , which in turn formed the basis of the ultimate determination under 
Article  3.5".906 The Panel found that "[t]he different  magnitude of the price decreases from  2012 to 
2013 does not necessarily undermine the KTC's findings with respect to the competitive relationship 
between the dumped imports and the domestic like product."907 According to the Panel, the KTC's 
explanation tha t "the prices of the domestic industry were already at unsustainabl y low levels"908, 
which constrained any further price reductions, was reasonable and supported by the facts.909 For 
the alleged divergence from 2011 to 2012, the Panel acknowledged that it "cou ld suggest a lack of 
competition between the dumped imports and the domestic like product".910 However, the Panel 
found that "[t]he KTC did not disregard this possibility in its analysis" as it "explained that the 
diverging trend from 2011 to 2012 was caused  by a change in the product mix of the dumped 
imports."911 The Panel found this explanation to be "reasonable and supported by the facts ".912  
5.338.   As noted  above, the Panel's analysis focused on whether there was a competitive relationship 
between dumped imports a nd domestic like products despite diverging price trends, and whether 
the diverging price trends could, in  and of  themselves, undermine the causal relationship.913 This, 
                                                
901 See section 5.3.4.1.5 above.  
902 Korea's appellee's submission,  para. 292. 
903 Japan's appellant's submission, para.  186. 
904 Korea's appellee's submission, para.  299 (referring to Korea's first written submission to the Panel, 
paras.  77-92 and 97 -112).  
905 Korea's appellee's submission, para.  299. 
906 Panel  Report, para.  7.273. (emphasis added)  
907 Panel  Report, para.  7.295.  
908 Panel Report, para.  7.278 (referring to KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)), p.18).  
909 Panel  Report, para.  7.295.  
910 Panel  Report, para.  7.295.  
911 Panel  Report, para.  7.295.  
912 Panel  Report, p ara. 7.295.  
913 See section 5.3.4.1.2.2 above. See also Panel  Report, para.  7.295.  
 WT/DS504/AB/R  
 
- 106 - 
 
  as noted, is  evident from the manner in which the Panel drew its conclusions concerning the 
diverging trends in the average prices of dumped imports and the domestic like product when it 
explained that: (i) the different magnitude of the price decreases from 2012 to 2013 does not 
necessarily undermine the KTC's findings with respect to the competitive relationship  between the 
dumped imports and the domestic like product914; (ii) the opposing price movements from 2011 
to 2012 could suggest a lack of competition  between the dumped imports and the domestic like 
product and the KTC did not disregard  this possibility in its analysis915; and (iii) the verified instances 
in which the dumped imports were sold at prices lower than those of the domestic like product 
support the view that there was competition  in the Korean market for valves.916 We have reviewe d 
above these findings by the Panel and explained that the Panel properly reviewed the Korean 
investigating authorities' examination of the relationship  between the prices of the dumped imports 
and those of the domestic like product s, in order to ascertain  the effects of the former on the latter. 
In so doing, we have found that this corresponds to an examination properly conducted pursuant to 
Article  3.2, second sentence. Therefore, given that we have found above that the Panel properly 
reviewed the Korean investigating authorities' consideration of the diverging price trends in light of 
the requirements set out in Article  3.2, second sentence , and found it reasonable and supported by 
facts, we reject Japan's allegation that the KTC "largely ignored" the div erging price trends which 
strongly suggested the lack of interaction in the market between the price s of the subject imports 
and those of the domestic like products.917  
5.339.   For these reasons, we are able to complete the legal analysis and find that the Korean 
investigating authorities did not act inconsistently with Articles  3.1 and  3.2 of the Anti -Dumping 
Agreement with respect to their consideration of diverging price trend s. 
5.340.   We now turn to Japan's argument that  "the KTC failed to address the counterfactual question 
of how prices … might  have been different in the absence of dumping."918 Japan asserts that the 
KTC did not examine certain "market interactions" between the dumpe d imports and domestic like 
products.919 In this way, according to Japan, "the KTC's determination ignored significant facts 
suggesting that there is no meaningful competitive relationship between the subject imports and 
domestic like products as a whole."920 
5.341.   Korea disputes Japan's  claim that Article  3.2 of the Anti -Dumping Agreement requires an 
investigating authority "to consider what would have happened to domestic prices 'in the absence 
of dumping'" .921 Even if there is such an obligation, Korea argues that t he Korean investigating 
authorities adequately addressed the issue "by looking at a reasonable sales price or by examining 
price developments in light of market conditions such as increasing demand or costs".922 
5.342.   Japan's argument is premised on the notion tha t Article  3.2 of the Anti -Dumping Agreement 
requires an investigating  authority to consider "the competitive relationship between the dumped 
imports and the domestic like product in conjunction with the dumping margins at issue".923 Korea, 
however, disagrees  with Japan's argument that the "core question" in a price -effects analysis under 
Article  3.2 is to consider what would have happened to domestic prices "in the absence of dumping, 
i.e. if the dumped imports had been sold at their normal value".924 Korea con siders this argument 
legally erroneous, because the text of Article  3.2 refers to the price effects of "dumped imports" 
rather than of "dumping". These arguments thus raise a question regarding Article  3.2 that the Panel 
never explored with the parties. In deed, Japan concedes that "[t]he Panel … did not address at all 
Japan's point[] under Article  3.2 about the failure to … provide an analysis of the counterfactual 
question of how prices might have been different in the absence of dumping."925 In our view, 
                                                
914 Panel  Report, para.  7.295.a.  
915 Panel  Report, para.  7.295.a.  
916 Panel  Report, para.  7.295.c.  
917 See section 5.3.4.1.2.2 above.  
918 Japan's appellant's submission, para.  185 (referring to Japan's second written submission to the 
Panel, paras.  17 and 25 -32). 
919 Japan's appellant's submission, para.  187. 
920 Japan's appellant's submission, para.  187. 
921 Korea's appellee's submission, para.  267 (quoting Japan's appellant's submission, para.  191).  
922 Korea's appellee's submission, para.  267. 
923 Japan's appellant's submission, para.  185. 
924 Korea's appellee's submission, para.  267 (quoting Japan's appellant submission, para.  191).  
925 Japan's appell ant's submission, para.  200. 
 WT/DS504/AB/R  
 
- 107 - 
 
  engaging with this issue would therefore require us to "review and consider evidence and arguments 
that … were not sufficiently addressed by the Panel or sufficiently explored and developed before 
the Panel".926 
5.343.   Accordingly, we find ourselves unable to complete the legal analysis as to whether the 
Korean investigating authorities acted inconsistently with Articles  3.1 and 3.2 in " fail[ing] to address 
the counterfactual question of how prices … might have been different in the absence of dumping" .927  
5.344.   Next,  Japan contends that "the KTC  also ignored the absence of any evidence of price 
suppression in 2011 and 2012, and drew improper conclusions from the limited evidence in 2013."928 
According to Japan, "contrary to the KTC findings, the OTI data on 'reasonable selling price' actually 
undermined any finding of price suppression."929 In addition, Japan dismisses the "reasonable sales 
price" analysis claiming that it was "flawed and insufficient".930 According to Japan, "Korea did not 
explain how or why it selected a p articular benchmark to set the 'reasonable selling price', or why 
that benchmark should be considered reasonable."931 
5.345.   Korea, for its part, disputes these arguments. Specifically, Korea argues that the KTC 
"adopted the relevant approach to price suppression b y using a 'reasonable sales price' or 
constructed target price for comparison with the actual price levels, irrespective of whether the 
prices mirror each other in terms of direction and magnitude".932 Moreover, Korea claims that "[the] 
OTI verified that the  domestic industries could  have raised the sales price of the like product to the 
level of the reasonable sales prices if there had been no dumping, based on the magnitude of 
dumping margins and the range of 'reasonable sales prices' ."933 
5.346.   We note that, beyon d a general reference in the "Relevant facts" section934, the Panel did 
not specifically address the issues relating to the OTI's use of the "reasonable sales price", including 
the OTI's choice of the operating profit ratio that was used to construct the "re asonable sales 
price".935 The Panel merely noted that "[i]n its Final Report, the OTI appended two explanatory notes 
regarding the calculation of the reasonable sales price to the table reporting comparisons between 
the actual price and the reasonable sales price."936 It is also evident from the competing positions 
adopted by the parties that the underlying factual bases are contested. Thus, given the limited scope 
and nature of the Panel's factual findings and the limited undisputed record evidence in this reg ard, 
our attempt to complete the legal analysis involving such competing arguments would require us to 
"review and consider evidence and arguments that … were not sufficiently addressed by the Panel 
or sufficiently explored and developed before the Panel".937  
5.347.   Accordingly, we find ourselves unable to complete the legal analysis as to whether the 
Korean investigating authorities acted inconsistently with Articles  3.1 and 3.2 , owing to the alleged 
flaws and insufficiencies in their  "reasonable sales price" anal ysis.938 
5.348.   Finally, Japan argues that the Korean investigating authorities never considered whether the 
alleged price suppression and price depression were "significant".939 However,  we fail to detect any 
specific argumentation in Japan's submissions before us t hat substantiates how and why the Korean 
investigating  authorities failed to address the significance of the price suppression and price 
                                                
926 Appellate  Body Report, EC and certain member States – Large Civil Aircraft (Article  21.5 – US), 
para. 5.749.  
927 Japan's appellant's submission, para.  185 (referring to Japan's second written submission to the 
Panel, paras.  17 and 25 -32). 
928 Japan's appellant's submission, para.  186. 
929 Japan's appellant's submission, para.  186. 
930 Japan's appellant's submission, para.  192. 
931 Japan's appellant's submission, para.  193. 
932 Korea's appellee's submission, paras.  295 and 309.  
933 Korea's appellee's submission, para.  422 (quoting OTI's Final Report (Panel Exhibit KOR -2b (BCI)), 
p. 85). 
934 See e.g. Panel  Report, paras.  7.112 and 7.116 -7.117.  
935 Panel  Report, para.  7.116 (quoting OTI 's Final Report  (Panel Exhibit KOR -2b (BCI)), p.  57). 
936 Panel  Report, para.  7.116.  
937 Appellate  Body Report, EC and certain member States – Large Civil Aircraft (Article  21.5 – US), 
para. 5.749.  
938 Japan's appellant's submission, para.  192. (fn  omitted)  
939 Japan's appellant's submission, para.  186. 
 WT/DS504/AB/R  
 
- 108 - 
 
  depression they identified. Moreover, we note that Korea disputes Japan's argument and claims that 
the KTC considered the quantitative aspect of the price effects of the dumped imports.940 In addition, 
Korea argues that the KTC considered that the drop in domestic prices in 2013 to be particularly 
significant given that "domestic prices had already been suppresse d throughout the entire POI, and 
because in 2013 consumption grew significantly and manufacturing costs increased".941 We note 
that the Panel did not explore the issue of "significance" of the identified price effects with the 
parties. Indeed, as Japan conce des, "[t]he Panel … did not address at all Japan's point[] under 
Article  3.2 about the failure to … show whether imports affected the price of subject products to a 
'significant' degree."942 These considerations suggest that the factual basis underlying Japa n's 
argument is disputed and, notably, remained unaddressed by the Panel.  
5.349.   Accordingly, we find ourselves unable to complete the legal analysis as to whether the 
Korean investigating authorities acted inconsistently with Articles  3.1 and 3.2 because  the KT C never 
considered whether the alleged price  suppression and price depression were "significant".  
5.350.   In light of the foregoing considerations, we find that we are able to complete the legal 
analysis in part. For the reasons explained above, we find that the Korean investigating authorities 
acted inconsistently with Articles  3.1 and 3.2 of the Anti -Dumping Agreement: (i) to the extent they 
found price -suppressing and -depressing effects of dumped imports based on the relevant price 
comparisons without ensuring  price comparability ; and (ii) in the absence of any explanation and 
analysis of how and to what extent the prices of the domestic like product were affected in light of 
the consistent overselling by dumped imports when finding price suppression and price depression . 
We also find that the Korean investigating authorities did not act inconsistently with Articles  3.1 
and 3.2 of the Anti -Dumping Agreement with respect to their consideration of diverging price trends.  
5.351.   However, for the reasons explained above, w e find ourselves unable to complete the legal 
analysis as to whether the Korean investigating authorities acted inconsistently with Articles  3.1 
and 3.2 on the basis of Japan's arguments that : (i) "the KTC failed to address the counterfactual 
question of h ow prices … might have been different in the absence of dumping"943; (ii) the 
"reasonable sales price" analysis "was flawed and insufficient, as the KTC failed to examine market 
interactions between the subject imports and domestic like products"944; and (iii) the KTC never 
considered whether the alleged price  suppression and price depression were "significant" .945 
5.3.5.3   Whether the Korean investigating authorities acted inconsistently with 
Articles  3.1 and 3.4 of the Anti -Dumping  Agreement in their consideration of the impact 
of dumped imports on the state of the domestic industry  
5.352.   We turn to Japan's claim under Articles  3.1 and 3.4 of the Anti -Dumping Agreement  
regarding the impact of dumped imports on the state of the domestic industry. Japan advances three 
argum ents in support of its claim that the Korean investigating authorities acted inconsistently with 
these provisions, namely that: (i) the KTC did not establish any logical link between its findings 
regarding the volume and price effects under Article  3.2 of the Anti -Dumping Agreement and its 
finding of impact under Article  3.4946; (ii) the KTC "more generally" failed to show any explanatory 
force from dumped imports regarding the trends related to the condition of the domestic industry947; 
and (iii) the KTC faile d to explain adequately how imports had negatively impacted the domestic like 
products as a whole in light of positive trends experienced by the domestic industry.948 
5.353.   Turning to the first of Japan's arguments, Japan contends that the KTC did not establish an y 
"logical  link" between its findings regarding the volume and price effects under Article  3.2 and its 
finding of impact under Article  3.4.949 
                                                
940 Korea's appellee's submission, para.  305. 
941 Korea's appellee's submission, para. 306.  
942 Japan's appellant's submission, para.  200. 
943 Japan's appellant's submission, para.  185. 
944 Japan's appellant's submission, par a. 192. (fns  omitted)  
945 Japan's appellant's submission, para.  186. 
946 Japan's appellant's submission, para.  237. 
947 Japan's appellant's submission, para.  245. 
948 Japan's appellant's submission, para.  250. 
949 Japan's appellant's submission, para.  237. 
 WT/DS504/AB/R  
 
- 109 - 
 
  5.354.   Korea responds that there is no requirement under Article  3.4 to establish a "logical link" 
between the volume of t he dumped imports and their price effects, on the one hand, and the injury 
factor developments, on the other hand.950 Korea adds that the focus of Article  3.4 is on the 
evaluation of all relevant factors affecting the domestic industry, rather than on establ ishing a causal 
link with price suppression or depression or increased volumes of imports.951 
5.355.   We recall that, in the context of claim 6, Japan made an identical argument contending that 
"the Panel's conclusion that the KTC need not establish a link between volume and price effects 
under Article  3.2 and impact on the domestic industry under Article  3.4 is … wrong."952 In addressing 
Japan's appeal in section 5.3.4.1.2.3  above, we agreed with t he Panel that, in order to examine the 
impact of dumped imports on the domestic industry properly for purposes of Article  3.4, an 
investigating authority is not required to link that examination with its consideration of the volume 
and the price effects of  the dumped imports.953 Contrary to Japan's argument, the Appellate  Body's 
reliance on the term "the effect of" in Article  3.2 does not suggest that this provision  "explicitly 
foreshadows the next step of considering 'the factors affecting domestic prices in  Article  3.4'".954 
Rather, we believe , as did the Panel, that the inquiries under Articles  3.2 and 3.4 can be undertaken 
independently, and brought together in the ultimate determination of causation under Article  3.5.955 
Therefore, we reject, for the same rea sons stated above , the premise of Japan's argument that 
Article  3.4 necessarily requires an investigating authority to link its examination of the impact of 
subject imports on the domestic industry with its consideration s of volume and price  effects  under 
Article  3.2.  
5.356.   Next, Japan contends that "the KTC['s] Final Resol ution more generally failed to show any 
explanatory force from subject imports regarding the trends related to the condition of the domestic 
industry."956 Instead, according to Japan, "the KTC discussion of impact was more suggestive of 
other  factors having explanatory force, not subject imports."957 In support  of this point , Japan 
submits:  
a. the decline in total domestic consumption in 2012 had far more power to explain the 
decline in domestic sales in 2012 than did the decline in subject imports in the same yea r. 
These facts did not produce any reasonable basis for the KTC to infer that the subject 
imports replaced the domestic like products, at least, in 2012; rather, these facts 
demonstrated that there was no interaction between the subject imports and the dom estic 
like products in the market;  
b. the domestic industry's loss of market share in 2013 was caused by the sharp increase of 
consumption in 2013, rather than by dumped imports , which were a less important 
explanatory factor;  
c. the fact that dumped import pric es were higher than domestic prices undermines the 
explanatory force of those imports for the decrease in the prices of the domestic like 
product in 2013;  
d. competition between the two applicants, as a result of the increase in their respective 
capacity, has  more explanatory force than the dumped imports for the trends in the prices 
of the domestic industry; and  
e. the explanatory force of the dumped imports for the decrease in domestic prices is 
undermined by the fact that domestic prices decreased by 3.6% in 2 012 whereas dumped 
                                                
950 Korea's appellee's submission, para.  386. 
951 Korea's appellee's submission, para.  387. 
952 Japan's appellant's submission, para.  293 (referring to Panel  Report, paras.  7.330 and 7.347.b).  
953 Panel  Report, para.  7.330. 
954 Japan's appellant's submission para.  292. 
955 Panel  Report, para.  7.329.  
956 Japan's appellant's submission, para.  245. (fn  omitted)  
957 Japan's appellant's submission, para.  245. (emphasis added)  
 WT/DS504/AB/R  
 
- 110 - 
 
  import prices increased by 7%, and domestic prices decreased by only 1.2% in 2013, 
when dumped import prices fell by 31.1%.958 
5.357.   Korea, for its part, contends that "Japan seems to consider that [the] KTC should have 
carried out a fully -fledged non-attribution analysis for its examination under Article  3.4."959 In any 
event, Korea submits that " [the] KTC established the requisite 'link', or 'explanatory force', of the 
dumped imports on the state of the domestic industry ."960 
5.358.   Article  3.4 of the Ant i-Dumping Agreement  is concerned with "the relationship between 
subject imports and the state of the domestic industry".961 Thus, Article  3.4 does not merely require 
an evaluation of each of the injury factors relevant to the state of the domestic industry b ut 
contemplates that an investigating authority assess the impact of dumped imports on the basis of 
such an evaluation.962  
5.359.   Japan suggests  that the Korean investigating authorities were required to undertake a 
full-fledged causation  and non -attribution analysis in their examination under Article  3.4. Several of 
Japan's above arguments , namely (a), (b), and (d),  allege that factors other than the dumped 
imports were responsible for the state of the domestic industry.963 Indeed, Japan's argument that 
"[t]he same facts can both undermine the existence of any explanatory force and then also lead to 
an argument [on non -attribution ]"964 suggests that , in Japan's vie w, Article  3.4 contemplates an 
exhaustive analysis of all known factors that may  cause injury to the domestic industry, thereby, 
duplicating the overall causation determination required under Article  3.5. We are unable to 
subscribe to Japan's understanding of Article  3.4. We have considered above an identical legal 
question965 and expla ined that  the demonstration that subject imports are causing injury to the 
domestic industry "is an analysis specifically mandated by Article  3.5".966 Indeed, as the 
Appellate  Body stated , under Article  3.4 "an investigating authority is required to examine  the 
impact of subject imports on the domestic industry", but "is not required to demonstrate  that subject 
imports are causing injury to the domestic industry".967 We are therefore not convinced that the 
Korean investigating authorities were required to consi der these " other factors"  enumerated by 
Japan in their examination under Article  3.4 of the impact of the dumped imports on the state of the 
domestic industry.968 
5.360.   Turning to the third of Japan's arguments, Japan argues that "the KTC … failed to adequately 
explain how imports had negatively impacted the domestic like products as a whole in light of positive 
trends experienced by the domestic industry."969 Japan contends that the KTC appears to have 
attached "a high degree of importance to the other relevant factors highlighting negative aspects of 
the domestic industry, while disregarding or downplaying the many factors suggesting that the 
Korean industry was not suffering injury".970 In particular, Japan asserts that "[t]he domestic 
industry saw incre asing domestic sales and substantial new investment."971 
                                                
958 Japan's appellant's submission, para.  245. (fns  omitted)  
959 Korea's appellee's submission, para.  400. 
960 Korea's appellee's submission, para.  399. 
961 Appellate  Body Report, China – GOES , para.  149. 
962 Appellate  Body Report, China – GOES , para.  149. In this regard, the Appellate  Body has indicated 
that the factors an d indices that are relevant to an examination under Article  3.4 not only include those 
expressly listed therein but additional ones if they are relevant to the assessment of the state of the domestic 
industry. (Appellate  Body Report, Russia – Commercial Ve hicles , para.  5.155)  
963 Panel Report, para.  7.338.  
964 Japan's appellant's submission, para.  249. 
965 See section 5.3.4.1.2.3 above. In the context of claim 6, Japan argued that the Panel "incorrectly" 
noted "there is no need 'to undertake a fully reasoned caus ation and non -attribution analysis' as part of 
Article  3.4." (Japan's appellant's submission, para.  290 (quoting Panel  Report, para.  7.332))  
966 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para. 5.205 (referring to 
Appellate  Body Report, China – GOES , para.  150).  
967 Appellate  Body Report, China – GOES , para.  150. (emphasis original)  
968 As for arguments (c) and (e), we have addressed Japan's similar arguments concerning price 
overselling and diverging price trends in sections 5.3.4.1.4 and 5.3.4.1.2.2, respectively.  
969 Japan's appellant's submission, para.  250. 
970 Japan's appellant's submi ssion, para.  251. 
971 Japan's appellant's submission, para.  251. 
 WT/DS504/AB/R  
 
- 111 - 
 
  5.361.   In response, Korea submits that "WTO jurisprudence confirms that there is no obligation to 
conclude that every factor is negative under Article  3.4."972 Korea asserts that the KTC's injury 
determination was grounded on the comprehensive review of "all relevant economic factors" and its 
holistic injury examination cannot be undermined just because a few indices were not necessarily 
indicative of injury.973 
5.362.   We recall that Article  3.4 requires an investigating  authority to examine the impact of subject 
imports on the state of  the domestic industry on the basis of "all relevant economic factors and 
indices having a bearing on the state of the industry", and provides a list of such factors and indicia 
that the au thority must evaluate.974 Article  3.4 makes it clear that neither one nor several of the 
factors listed therein can "necessarily give decisive guidance" as to the impact of the dumped imports 
on the state of the domestic industry. As noted by the Appellate  Body, "there is no exclusive 
methodology prescribed for an investigating authority to conduct an examination under 
Article  3.4."975 
5.363.   Japan argues that, notwithstanding the fact that the domestic industry saw increasing 
domestic sales and substantial new invest ment, the KTC did not provide any explanation whatsoever 
regarding the weight attributed to any given factor  or of the inferences it drew from those factors 
that were positive.976 However, we recall that, in the context of Japan's claim under Articles  3.1 an d 
3.4 of the Anti -Dumping Agreement, the Panel found that Japan's claim concerning the state of the 
domestic industry is limited to the allegation that the KTC failed to evaluate two of the specific factors 
listed in Article  3.4, one of which was the abili ty to raise capital or investments .977 The Panel noted 
that, "[i]n Japan's view, the fact that investment expanded in those two years contradicts the KTC's 
overall evaluation of the domestic industry's ability to raise capital."978 In that connection, the Panel 
noted that , having found that investment increased sharp ly from 2011 to 2012, "the KTC went on 
to analyse the reasons for the increase in the first place, and the impact of the fiscal crisis -led 
contraction in demand on investment."979 Ultimately, the Panel found that Japan failed to 
demonstrate that the KTC's ev aluation of the investment and funding ability of the domestic industry 
is not one that a reasonable and objective investigating authority could make in light of the evidence 
and arguments before it.980 Japan has not challenged on appeal this finding by the Panel. Thus, we 
are unable to see the basis on which Japan requests us to complete the legal analysis and find that 
the Korean investigating authorities acted inconsistently with Articles  3.1 and  3.4 with respect to its 
argument concerning positive trends in investment , which stands addressed by the Panel and 
remains unappealed .  
5.364.   We also recall that , in the context of Japan's claim 6 under Articles  3.1 and 3.5 of the 
Anti-Dumping Agreement , the Panel addressed Japan's argument that the KTC failed to take in to 
account positive trends during the period of trend analysis with respect to sales such that it 
"disproved" the existence of a causal relationship between the dumped imports and the injury to the 
domestic industry.981 The Panel observed that the KTC noted and acknowledged the 14% increase 
in sales from 2010 to 2013, and the 7.6% increase in sales from  2012 to 2013, in the context of a 
52.8% increase in consumption.982 The Panel further observed that the KTC noted that the domestic 
industry lost 11.6  percentag e points  of market share, almost entirely to dumped imports, which  
indicated material injury.983 Japan has not appealed these findings made by the Panel . It is therefore 
unclear on what basis Japan asserts that, notwithstanding these findings, the KTC's asse ssment of 
sales was flawed.  
                                                
972 Korea's appellee's submission, para.  403. (fn  omitted)  
973 Korea's appellee's submission, para.  403. 
974 Appellate  Body Report, China – GOES , para.  147. 
975 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.204.  
976 Japan's appellant's submission, para.  251 (referring to Japan's first written submission to the Panel, 
paras.  180-182).  
977 Panel  Report, para.  7.175.  
978 Panel  Report, par a. 7.183.  
979 Panel  Report, para.  7.184.  
980 Panel  Report, para.  7.186.  
981 Panel  Report, paras.  7.324 and 7.341 -7.346.  
982 Panel  Report, para.  7.345.  
983 Panel  Report, para.  7.345.  
 WT/DS504/AB/R  
 
- 112 - 
 
  5.365.   That said, Japan's argument in the context of its present claim under Articles  3.1 and  3.4, 
regarding which it requests us to complete the legal analysis, encompasses broader considerations 
than those addressed in the above findings by the Panel. Not only does Japan make the argument 
about the positive trend experienced by domestic industry with respect to domestic sales, but it also 
asserts that the KTC attached " a high degree of importance to the other relevant factors  highlighting 
negative aspects of the domestic industry, while disregarding or downplaying" those factors that 
showed positive trends .984 Thus, Japan's contention that, in so doing, th e KTC acted inconsistently 
with Articles  3.1 and 3.4 would require  us to review the KTC's examination of impact and the weight 
it attributed to each of the factors listed in Article  3.4. Indeed, as Japan argues, "[t]he KTC's analysis 
of the relevant econom ic factors and indices of the domestic industry as listed in Article  3.4 were 
mixed" , and the KTC disregarded or downplayed "the many factors" that suggested that "the Korean 
industry was not suffering injury ."985 The Panel, however, did not have the occasio n to engage with 
these arguments in the context of Japan's claim under Articles  3.1 and 3.4. This was so because it 
found Japan's allegation that the KTC attached a high degree of importance to the relevant factors 
highlighting negative aspects, while disr egarding or downplaying those factors suggesting that the 
Korean industry was not suffering injury, to fall outside its terms of reference .986 Although , in the 
"Relevant facts" section,  the Panel set out the Korean investigating authorities' evaluation of al l the 
economic factors listed in Article  3.4, the Panel did not engage and explore th e question that Japan 
now raises, namely, how the KTC's evaluation of all the relevant economic factors fits together to 
support its overall examination regarding the impa ct of dumped imports on the state of the domestic 
industry.987 These considerations suggest that engaging in the completion exercise would require us 
to examine the relevance of each of the economic factors listed in Article  3.4 individually and conduct 
a collective assessment in order to review the consistency of the KTC's impact examination under 
Articles  3.1 and 3.4 with regard to which the Panel, notably, made no findings. Such an exercise, in 
our view, would  require us to review and consider evidence and  arguments that were not sufficiently 
addressed by the Panel or sufficiently explored and developed before the Panel.  
5.366.   Finally, Japan contends that, "[i]n the absence of a proper consideration of the dumped 
imports' effects on the domestic like product as a  whole, the impact examination in the present case 
[is] necessarily  inconsistent with Article  3.4".988 According to Japan, "[t]his problem is particularly 
serious in this case, since the KTC improperly defined the domestic industry, and actually assessed 
the impact of imports on only about half of the domestic industry ."989 We recall that Japan has also 
requested us to complete the legal analysis with respect to its claim under Articles  3.1 and 4.1 of 
the Anti -Dumping  Agreement and find that the Korean inves tigating authorities acted inconsistently 
with th ese provisions in the determination of the "domestic industry" in the anti -dumping 
investigation at issue. However, for the reasons stated above, we have found that we are unable to 
complete the legal analys is in view of the dispute d nature of  certain facts underlying the definition 
of the domestic industry and the lack of the Panel's exploration of the relevant issues and evidence.   
5.367.   In light of the foregoing considerations, we find ourselves unable to comple te the legal 
analysis as to whether the Korean investigating authorities acted inconsistently with Articles  3.1 
and 3.4 of the Anti -Dumping Agreement  on the basis of Japan's argument that the KTC failed to 
adequately explain how imports had negatively impa cted the domestic like products as a whole in 
light of positive trends experienced by the domestic industry.990 
5.4  Confidential treatment of information  
5.368.   The Panel found that Japan's claims 8 and 9 concerning the Korean investigating authorities' 
treatment of co nfidential information were within its terms of reference, and that Japan 
demonstrated that the Korean investigating authorities acted inconsistently with Articles  6.5 
and 6.5.1 of the Anti -Dumping  Agreement. Korea appeals the Panel's findings pursuant to Article  6.2 
of the DSU and , consequently , its conclusion that Japan's claims 8 and 9 were within its terms of 
reference. Should we uphold the Panel's findings under Article  6.2 of the DSU, Korea also appeals 
the Panel's findings that the Korean investigating authorities acted inconsistently with the obligations 
                                                
984 Japan's appellant's submission, para.  251. (emphasis added)  
985 Japan's appellant's submission, para.  251. 
986 Panel  Report, paras.  7.172 and 7.175.  
987 We note that Japan submits that "this summary of relevant facts is somewhat less useful than the 
others." ( Japan's appellant's submission, para.  230) 
988 Japan's appellant's submission, para.  241. (fn  omitted)  
989 Japan's appellant's submission, para.  241. (fn  omitted)  
990 Japan's appellant's submission, para.  250. WT/DS504/AB/R  
 
- 113 - 
 
  under Articles  6.5 and  6.5.1 of the Anti -Dumping  Agreement. Japan requests the Appellate  Body to 
uphold both the Pan el's findings concerning its terms of reference and the findings on the merits  of 
Japan's claims .  
5.369.   We begin by assessing whether the Panel erred in finding that Japan's claims 8 and 9 
concerning the confidential treatment of information were within its ter ms of reference. If we uphold 
the Panel's findings under Article  6.2 of the DSU, we will proceed to determine whether the Panel 
erred in its findings regarding the merits of Japan's claim s under Articles 6.5 and 6.5.1 of the 
Anti-Dumping  Agreement.  
5.4.1   Whethe r the Panel erred in finding that Japan's claims 8 and 9 concerning the 
confidential treatment of information were within its terms of reference  
5.370.   Claims  8 and 9 in Japan's panel request state that the measure at issue is inconsistent with 
Korea's obligation s under:  
[] Article  6.5 of the [Anti-Dumping]  Agreement because Korea treated allegedly 
confidential information provided by the interested parties as confidential  without good 
cause  shown;  
[] Article  6.5.1 of the [Anti-Dumping]  Agreement because Korea: ( a) failed to require 
the applicants to furnish non -confidential summaries of their submissions, questionnaire 
responses, and amendments thereof; and ( b) where such summaries were provided, 
they were not in sufficient detail to permit a reasonable understand ing of the substance 
of the information submitted in confidence [.] 
5.371.   The Panel found that, on its face, the panel request provide d a brief but sufficient explanation 
as to how and why Japan consider ed the measures at issue to be violating the specific WTO 
obligations in question, namely  those in Articles  6.5 and 6.5.1 of the Anti -Dumping  Agreement.  
According to the Panel, this language was precise enough to both define the basis for the Panel's 
terms o f reference and inform other WTO Members, including the respondent, of the nature of the 
dispute.991  
5.372.   The Panel found that its conclusion was confirmed by taking into account the scope of the 
allegations concerning the alleged inconsistencies in the confidential treatment of information 
advanced in Japan's submissions , namely  that: (i) t he Korean investigating authorities granted 
confidential treatment to certain information provided by the applicants without requiring a showing 
of good cause and with out conducting an objective assessment to justify the confidentiality; and 
(ii) with respect to certain documents, the Korean investigating authorities failed to require that 
submitting parties provide a non -confidential summary of the information that was  treated as 
confidential or to show why such a summary  could not be provided.992 Furthermore, the Panel noted 
that, in its first written submission to the Panel, Japan identified 38 specific elements of information 
that are the basis of its claims  under Articles 6.5 and 6.5.1 of the Anti -Dumping  Agreement. The 
Panel indicated that these specific elements of information , which  were allegedly granted confidential 
treatment without good cause shown, may be seen as part of the arguments advanced by Japan in 
suppo rt of its claims . Consequently,  the Panel considered that Japan was not required to include 
these specific elements in the panel request.993  
5.373.   Accordingly, the Panel found that Japan's claims concerning the confidential treatment of 
information under Articles  6.5 and 6.5.1 of the Anti -Dumping  Agreement were within its terms of 
reference.994 
5.374.   On appeal, Korea argues that the Panel erred in finding th at Japan's panel request, with 
respect to the claims  under Articles  6.5 and 6.5.1, comported with the obligation under Article  6.2 
of the DSU to "provide a brief summary of the legal basis of the complaint sufficient to present the 
                                                
991 Panel  Report, para.  7.415.  
992 Panel  Report, para.  7.416.  
993 Panel  Report, para.  7.417. See also ibid., para.  7.428.  
994 Panel  Report, para . 7.418.  
 WT/DS504/AB/R  
 
- 114 - 
 
  problem clearly".995 Korea  submits that the panel request "merely paraphrases the relevant legal 
obligations under Articles  6.5 and 6.5.1 without providing any additional information explaining the 
how and why of its claims ".996 Korea argues that, with respect to the claim under Article 6.5, in light 
of the wording of Japan's panel request, it is not possible  to identify what allegedly confidential 
information is concerned by the claim, or, at a minimum, the subject matter of that allegedly 
confidential information.997 Korea maintains  that, by resorting to Japan's subsequent submission, 
the Panel failed to adhere to the principle that the panel request must be examined on its face as it 
existed at the time of the filing, and that defects therein cannot be cured in subsequent submissions 
during the panel proceedings.998 Korea also argues that, with respect to Article  6.5.1, Japan's panel 
request similarly fails to explain the "how or why " of Japan's claim, as nothing in it links the claim 
to the particular circumstances of the investigation at issue . Korea adds  that the Panel also erred by 
relying on the examination of Japan's subsequent submissions.999 
5.375.   Japan responds that the panel request expressly identifies Articles  6.5 and 6.5.1 of the 
Anti-Dumping  Agreement as the specific provisions at issue for these two claims. Furthermore, the 
panel request identifies the obligation under Article  6.5 to grant confidential treatment to information 
that is by nature confidential or provided on a confidential basis  "upon good cause shown", and the 
obligation under Article  6.5.1 to require the provision of non -confidential summaries "in sufficient 
detail".1000 Japan contends that the language it used in its panel request presents the problem clearly 
by connecting the me asure at issue and the alleged inconsistencies, in light of the nature and scope 
of the particular obligations. Japan submits that "[t]he essence of these two claims is that the KTC 
conducted its investigation by just assuming that certain information was confidential without any 
specific inquiry, and accepted the absence of any non -confidential summaries, as evidenced through 
the KTC's Final Resolution and the OTI's Final Report."1001 Japan also indicates that Korea's 
arguments confuse the claim with the argu ments in support of the claim.1002 
5.376.   We indicated in section 5.1.1 above that a panel is to determine whether a panel request 
complies with the requirements of Article  6.2 of the DSU by examining the panel request on its face, 
taking into consideration the circ umstances of the case, including the nature of the measure and the 
nature of the provisions  concerned. In order to provide the legal basis of the complaint sufficient to 
present the problem clearly, a panel request must plainly connect the challenged measu re with the 
obligation alleged to have been breached. In this regard, a complainant must, a t a minimum, identify 
the provisions in the covered agreement alleged to have been breached.1003  
5.377.   Like the Panel, we observe that Japan has, in its claims 8 and 9 in the panel request , 
identified Articles  6.5 and 6.5.1 of the Anti -Dumping  Agreement as the provisions of the covered 
agreement alleged to have been breached.1004 Thus, Japan meets the minimum requirement under 
Article  6.2 of the DSU to identify the relevant prov isions alleged to have been breached. As indicated 
above, in some circumstances, particularly where the provisions concerned establish multiple 
obligations, it will not be sufficient merely to list the provisions in question in a panel request. In 
consider ing the nature of the provisions , therefore, we will seek to determine whether such 
circumstances arise in this dispute.  
5.378.   With regard to the nature of the measure, we observe that the narrative included in Japan's 
claims 8 and 9 indicate that they respecti vely concern Korea's treatment of certain information as 
                                                
995 Korea's other appellant's submission, para.  304. In particular, Korea argues that nothing in the 
Panel's findings suggests that the Panel examined this important question. Indeed, the Panel did not take into 
account the nature of the measure at issue and the manner in which it was described in the panel request and 
did not examine the nature and scope of the provisions of the covered agreements alleged to have been 
breached. (Ibid.)  
996 Korea's other appellant's submission, para.  305. (emphasis ori ginal)  
997 Korea's other appellant's submission, para.  307. 
998 Korea's other appellant's submission, para.  310 (referring to Appellate  Body Report, US – Carbon 
Steel, para.  127).  
999 Korea's other appellant's submission, para.  311. 
1000 Japan's appellee's submissi on, para.  161. 
1001 Japan's appellee's submission, para.  162 (referring to Japan's second written submission to the 
Panel, paras.  209-211 and 214 -234).  
1002 Japan's appellee's submission, para.  165 (referring to Korea's other appellant's submission, 
paras.  307-309).  
1003 See para.  5.6 above.  
1004 See Panel Report, paras.  7.414-7.415.  
 WT/DS504/AB/R  
 
- 115 - 
 
  confidential under Article  6.5 of the Anti -Dumping  Agreement, and Korea's treatment of summaries 
of confidential information under Article  6.5.1 of the Anti -Dumping  Agreement. It is therefore a 
specific portion of the measure at issue that is concerned by Japan's claims 8 and 9.  
5.379.   With regard to the nature of the provisions concerned, under Article  6.5, authorities must 
treat information submitted by parties to an investigation as confidential if it is  "by nature" 
confidential or if it is "provided on a confidential basis" , and "upon  good cause  shown".1005 In 
addition, Article  6.5 provides illustrative examples of information that falls into the category of "by 
nature" confidential .1006 
5.380.   Article  6.5 of the Ant i-Dumping  Agreement thus establishes a clear and well -delineated 
obligation, such that referencing this provision in a panel request , and connecting it to the specific 
portion of the measure at issue,  suffices  to comply with the requirements of Article  6.2 of the DSU. 
Thus, we agree with the Panel that, by indicating that Japan  considers Korea to have breached 
Article  6.5 because Korea treated allegedly confidential information provided by the interested 
parties as confidential  without good cause  shown, claim 8 in Japan's panel request has provided a 
brief summary of the legal basis sufficient to present the problem clearly, including by plainly 
connecting the challenged measure with the obligation alleged to have been breached.   
5.381.   With respect to Japan's claim pursuant to Article  6.5.1 of the Anti -Dumping  Agreement, we 
recall that Japan's claim 9, which is described in paragraph 5.370  above, refers specifically to the 
first two sentences of Article  6.5.1.1007 In essence, these two sentences oblige the investigating 
authority to require non -confidential summaries of confidential information in sufficient detail to 
permit a reasona ble understanding of the substance of the information submitted in confidence.  
5.382.   The portion of Article  6.5.1 specifically referenced in Japan's claim 9 establishes a clear and 
well-delineated obligation, such that referencing these sentences suffices to pr ovide a clear 
indication of the legal basis of Japan's complaint under this claim. Specifically, the narrative of 
Japan's claim makes clear that it takes issue with the alleged failure of the Korean investigating 
authorities: (i) to require the applicants to furnish non -confidential summaries of their submissions, 
questionnaire responses, and amendments thereof; and (ii) where such summaries were provided, 
to ensure that they were in sufficient detail to permit a reasonable understanding of the substance 
of the information submitted in confidence. In our view, therefore, Japan's claim sufficiently connects 
the measures at issue with the alleged violation of Article  6.5.1.  
5.383.   Korea argues that "[a]s a general matter, large volumes of confidential information are  
received and assessed by investigating authorities in an anti -dumping investigation, and the 
underlying  investigation to this dispute was no exception ."1008 However , in light of the wording of 
the panel request, "there is no way to identify what allegedly co nfidential information is concerned 
by the claim or, at a minimum, the subject matter of that allegedly confidential information."1009 
However, we recall that Article  6.2 demands only "a  brief summary" of the legal basis of the 
                                                
1005 We recall that Article  6.5 of the Anti -Dumping Agreement provides:  
Any information which is by nature confidential (for example, because its disclosure would be of 
significant competitive advantage to a competitor or because its disclosure would  have a 
significantly adverse effect upon a person supplying the information or upon a person from whom 
that person acquired the information), or which is provided on a confidential basis by parties to 
an investigation shall, upon good cause shown, be trea ted as such by the authorities. Such 
information shall not be disclosed without specific permission of the party submitting it.  
1006 Appellate  Body Report,  EC – Fasteners (China) , para.  536. The Appellate  Body indicated, for 
instance, that "[o]ne type of such  information is commercially sensitive information not typically disclosed in 
the normal course of business, and which would likely be regularly treated as confidential in anti -dumping 
investigations" and that "[t]his could be the case, for example, for ce rtain profit or cost data or proprietary 
customer information." (Ibid., para.  536 and fn  775 thereto)  
1007 We recall that Article  6.5.1 of the Anti -Dumping Agreement provides:  
The authorities shall require interested parties providing confidential informatio n to furnish 
non-confidential summaries thereof. These summaries shall be in sufficient detail to permit a 
reasonable understanding of the substance of the information submitted in confidence. In 
exceptional circumstances, such parties may indicate that su ch information is not susceptible of 
summary. In such exceptional circumstances, a statement of the reasons why summarization is 
not possible must be provided.  
1008 Korea's other appellant's submission, para.  307. 
1009 Korea's other appellant's submission, para.  307. 
 WT/DS504/AB/R  
 
- 116 - 
 
  complaint.1010 To require Japan to detail all allegedly confidential information concerned would 
appear to impose a burden that would go beyond what is required under Article  6.2. For these 
reasons, we share the Panel's view that specific elements of information that al legedly were granted 
confidential treatment without good cause shown may be seen as part of the arguments advanced 
by Japan in support of its claim, which need not be included in the panel request.1011 Thus, in our 
view, the Panel did not inappropriately rely  on Japan's subsequent submissions1012, but rather did 
so to confirm that the claim s listed in Japan's panel request w ere sufficient to present the problem 
clearly.  
5.384.   In sum, Japan's claims 8 and 9 concerning the confidential treatment of information  identify 
Articles  6.5 and 6.5.1 of the Anti -Dumping  Agreement , respectively,  as the provisions alleged to 
have been breached. Japan's claims also indicate that they relate , respectively , to the specific portion 
of the measure at issue concerning Korea's treatment of  certain information as confidential under 
Article  6.5 of the Anti -Dumping  Agreement, and Korea's treatment of non-confidential summaries of 
confidential information under Article  6.5.1 of the Anti -Dumping  Agreement. Article  6.5 establishes 
a clear and wel l-delineated obligation for investigating authorities to treat information submitted by 
parties to an investigation as confidential if it is "by nature" confidential or "provided on a confidential 
basis" , and "upon  good cause  shown". In addition, Japan's claim 9 refers to the first two sentences 
of Article  6.5.1, which set forth a clear and well -delineated obligation for the investigating authority 
to require non -confidential summaries in sufficient detail  to permit a reasonable understanding of 
the substance of the information submitted in confidence. Therefore, Japan's claims  8 and 9 each 
"provide a brief summary of the legal basis of the complaint sufficient to present the problem clearly" 
within the mea ning of Article  6.2 of the DSU.  
5.385.   For the foregoing reasons, we find that the Panel did not err in finding that Japan's claims 8 
and 9, concerning  the confidential treatment of information, were within its terms of reference. 
Consequently, we uphold  the Pane l's findings in paragraphs 7.418 and 8.2.e of the Panel  Report . 
5.4.2   Articles  6.5 and 6.5.1 of the Anti -Dumping  Agreement  
5.386.   Korea appeals  the Panel's findings under Articles  6.5 and 6.5.1 of the 
Anti-Dumping  Agreement. With respect to Article  6.5, Korea argues th at the Panel committed legal 
error in its interpretation and application of this provision. In addition, Korea contends that the Panel 
erred in its application of Article  6.5.1 of the Anti -Dumping  Agreement.  
5.4.2.1   Article  6.5 of the Anti -Dumping  Agreement  
5.4.2.1.1   The Pa nel's findings  
5.387.   Before the Panel, Japan argued that Korea acted inconsistently with Article  6.5 of the 
Anti-Dumping  Agreement  because the KTC granted confidential treatment to certain information 
provided by the applicants without requiring a showing of good cause and without conducting an 
objective assessment to justify the confidential treatment.1013 
5.388.   The Panel indicated that "con fidential information" within the meaning of Article  6.5 is 
information that is: "(a) by nature confidential; or (b)  provided on a confidential basis by parties to 
an investigation".1014 Moreover, pursuant to this provision, "upon good cause shown", an 
invest igating authority must treat such information as confidential and not disclose it without the 
permission of the submitter. The Panel pointed out that "[s]howing good cause is thus a 'condition 
precedent for according confidential treatment to information s ubmitted to an authority'."1015 The 
Panel added that "[t]he requirement to show good cause applies to all information for which 
                                                
1010 Emphasis added.  
1011 Panel  Report, para.  7.417.  
1012 Korea's other appellant's submission, para.  311. 
1013 Panel  Report, para.  7.391.  
1014 Panel  Report, para.  7.422.  
1015 Panel  Report, para.  7.423 (quoting Appellate  Body Report,  EC – Fasteners (China) 
(Article  21.5 – China) , para.  5.38).  
 WT/DS504/AB/R  
 
- 117 - 
 
  confidential treatment is sought, whether it is by nature confidential or submitted on a confidential 
basis."1016 
5.389.   In the case at hand,  the Panel considered that the main issue under Article  6.5 was whether 
the KTC granted confidential treatment to certain information provided by the applicants without 
requiring a showing of good cause and without an objective assessment of that showing t o justify 
the confidential treatment.1017 The Panel specified that it would focus its analysis on the 38 elements 
of information that Japan alleged were treated as confidential  without the KTC having required and 
assessed whether there was good cause for such  treatment.1018 
5.390.   The Panel indicated that a series of facts was undisputed by the parties. First, Article  15 of 
Korea's Enforcement  Rule of the Customs Act lists five categories of information  that are entitled to 
confidential treatment  in anti -dumping investi gations.1019 Second, in the anti -dumping investigation 
at issue, the applicants filed "Disclosed", or public, versions of at least three of their written 
submissions.1020 Certain information was redacted from these documents by being either removed 
entirely or replaced  with an "X" or asterisks.  The Panel added that, with respect to these 
submissions, in the course of the investigation, the responding companies had access only to the 
redacted versions .1021 
5.391.   Moreover, the Panel noted that there is no expli cit mention of "good cause" in any of the 
three public versions  of the written submissions or any link therein between the redacted information 
and the categories laid out in Article  15 of the Enforcement Rule of the Customs Act.1022 Likewise, 
there is no spe cific indication in the relevant documents on the record that the KTC or the OTI 
assessed whether good cause had been shown by the applicants .1023 Consequently, the Panel 
considered it clear that the Korean investigating authorities granted confidential treat ment to certain 
information provided by the applicants "without any evidence that a showing of good cause that 
would justify the confidential treatment had been required from the applicants".1024  
5.392.   Korea argued before the Panel that the 38 items of information  identified by Japan fall into 
the list set out in Article  15 of the Enforcement Rule of the Customs Act describing types of 
information to be treated  as confidential .1025 Korea asserted that, as a consequence, there was good 
cause to treat this information a s confidential. In this regard, Korea argued that the KTC "objectively 
assessed … whether the information was of the types for which Korean laws afford confidential 
protection" and "confirmed the 'good cause'" on the basis of this examination.1026 
5.393.   However , the Panel considered that there is no evidence on the record to support Korea's 
argument that the KTC objectively assessed whether there was "good cause" for treating certain 
information as confidential. As highlighted by the Panel, there was nothing on the record indicating 
that the applicants had specified or the Korean investigating authorities had taken into account 
whether the information in question fell into any of the categories set out in the relevant Korean 
                                                
1016 Panel  Report, para.  7.423.  
1017 Panel  Report, para.  7.427.  
1018 Panel  Report, para.  7.428 (referring to Japan's first written submission before the Panel, 
paras.  266-269 and annex III).  
1019 Under Article  15 of the Enforcement Rule of th e Customs Act, the five categories of information  that 
are entitled to confidential treatment in anti -dumping investigations are: (a)  costs of production; (b) 
accounting materials which have not been made public; (c) name, address, and trade volumes of tra de 
partners; (d) matters concerning the provider of confidential information; and (e) other materials adequately 
deemed as confidential.  (Panel  Report, para.  7.430 (referring to Article  15 of the Enforcement Rule of the 
Customs Act of Korea (Panel Exhibit KOR-34b)))  
1020 The three submissions with respect to which the applicants filed "Disclosed", or public, versions are: 
(i) the investigation application dated 23  December  2013; (ii) the summary of opinion from attorneys dated 
23 October  2014; and (iii) the re buttal opinion of applicants dated 13  November  2014. ( Panel  Report, 
para. 7.431)  
1021 Panel  Report, para.  7.431.  
1022 Panel  Report, para.  7.432 (referring to Korea's response to Panel question No. 113, para.  104).  
1023 Panel  Report, para.  7.432.  
1024 Panel  Report, par a. 7.434. Indeed, according to the Panel, "there is no evidence on record that the 
applicants made any indication as to the existence of good cause for confidential treatment, nor is there any 
evidence that the Korean Investigating Authorities requested th at such good cause be shown." (Ibid.)  
1025 Panel  Report, para.  7.438.  
1026 Panel  Report, para.  7.435 (quoting Korea's response to Panel question No. 69).  
 WT/DS504/AB/R  
 
- 118 - 
 
  legislation . The Panel indicated that, in these circumstances, it could not conclude that the Korean 
investigating authorities "actually engaged in a consideration of whether the submitters of the 
information had shown good cause for confidential treatment of the info rmation in question".1027 The 
Panel added that "the existence in the legislation of defined categories of information that will 
normally be treated as confidential does not relieve the investigating authorities of their obligation 
to determine that good cause  has been shown to justify the confidential treatment requested by the 
submitting party."1028 
5.394.   For the foregoing reasons, the Panel found that, with respect to the 38 items of information 
identified by Japan, the submitters did not show good cause for the conf idential treatment of that 
information. On that basis, the Panel concluded that, with respect to the information at issue, the 
Korean investigating authorities did not act consistently with Article  6.5 of the 
Anti-Dumping  Agreement.1029 
5.4.2.1.2   Whether the Panel erre d in its interpretation or application of Article  6.5 of the 
Anti-Dumping  Agreement  
5.395.   Korea maintains that the Panel committed two errors of law under Article  6.5 of the 
Anti-Dumping  Agreement. First, the Panel erred "when considering that investigating authorities 
must make statements  in the record demonstrating that 'good cause' was assessed and found to 
exist for the confidential treatment of certain pieces  or categories of informat ion".1030 In Korea's 
view, investigating authorities are not required to make an express "statement" as to whether good 
cause is shown. Instead, under Article  6.5, "an authority must satisfy itself (i.e. 'ensure') that good 
cause is shown before treating the information in question as confidential."1031 Second, Korea argues 
that, as a result of its erroneous interpretation of Article  6.5, the Panel also erred in applying  the 
law to the facts of this case. In particular, the Panel erred in finding that "[the] KTC failed to show 
that good cause was shown for certain pieces of evidence as there was no evidence on the record 
'linking the information for which confidential treatment was granted to the categories of confidential 
treatment identified in Korean law'."1032 Korea maintains that, based on a proper application of 
Article  6.5, the KTC was not obliged to make specific statements about each of the requests for 
confidentiality other than to "satisfy itself" that good cause was shown before treating the 
information in  question as confidential.1033  
5.396.   Japan responds  that the Panel properly found that, in the underlying investigation, the KTC 
failed to establish that "good cause" was shown for treating certain information as confidential, 
contrary to the requirements of Article 6.5 of the Anti -Dumping  Agreement. According to Japan, 
Article  6.5 conditions the granting of confidential treatment "upon good cause shown", and such 
condition is not met merely "if good cause exists".1034 Japan thus disagrees with Korea's argument 
that "every interested party 'implicitly asserts' the required 'good cause' by deleting allegedly 
confidential information in the public version of its submissions."1035 For Japan, Korea dismisses the 
importance of the explicit textual requirement that good cause must be "shown" and cannot merely 
be presumed to exist. Indeed, "[a]bsent some showing of 'good cause', a panel has no way to review 
what the authority has done and whether it complies with Article  6.5."1036 
                                                
1027 Panel  Report, para.  7.440.  
1028 Panel  Report, para.  7.438.  
1029 Panel  Report, para.  7.441.  
1030 Korea's other appellant's submission, para.  326. 
1031 Korea's other appellant's submission, para.  327. 
1032 Korea's other appellant's submission, para.  315 (quoting Panel  Report, para.  7.436).  
1033 Korea's other appellant's submission, para.  330 (referring to Korea's response to Panel question 
No. 65). 
1034 Japan's appellee's submission, para.  169. 
1035 Japan's appellee 's submission, para.  170 (referring to Korea's other appellant's submission, 
paras.  330-331).  
1036 Japan's appellee's submission, para.  171. (emphasis omitted)  
 WT/DS504/AB/R  
 
- 119 - 
 
  5.397.   As we see it, Korea's position is that an investigating authority could comply with Article  6.5 
simply by "satisfy[ing] itself (i.e. 'ensur[ing]')"1037 that good cause is shown, even in a situation 
where there is  no indication  on the record of the underlying in vestigation establishing that such 
authority conducted an objective assessment as to whether good cause was shown. In addressing 
Korea's argumentation, we begin by recalling the legal standard under Article  6.5 of the 
Anti-Dumping Agreement . 
5.398.   Past interpret ations  of Article  6.5 by the Appellate  Body can be summarized as follows. T he 
requirement to show "good cause" for confidential treatment applies to both information that is "by 
nature" confidential and that which is provided to the authority "on a confide ntial basis".1038 The 
"'good cause' alleged must constitute a reason sufficient to justify the withholding of information 
from both the public and from the other parties interested in the investigation".1039 Moreover, the 
"'[g]ood cause' must be assessed and det ermined objectively by the investigating authority, and 
cannot be determined merely based on the subjective concerns of the submitting party."1040 More 
specifically, "a party seeking confidential treatment for information must make its 'good cause' 
showing to  the investigating authority upon submission of the information. The authority must 
objectively assess the 'good cause' alleged for confidential treatment, and scrutinize the party's 
showing in order to determine whether the submitting party has sufficient ly substantiated its 
request."1041 In any event, "[t]he obligation remains with the investigating authority to examine 
objectively the justification given for the need for confidential treatment."1042 Thus, an authority 
would be acting inconsistently with its ob ligation under Article  6.5 "[i]f information is treated as 
confidential … without such a 'good cause' showing having been made".1043 Importantly, "a panel 
tasked with reviewing whether an investigating authority has objectively assessed the 'good cause' 
alleged by a party must examine this issue on the basis of the investigating authority's published 
report and its related supporting documents, and in the light of the nature of the information at 
issue and the reasons given by the submitting party for its requ est for confidential treatment."1044 
5.399.   Thus, while interested parties must make a "good cause" showing that certain information 
should be treated as confidential, it is ultimately  for the investigating authority to conduct an 
"objective assessment" of this issu e to determine whether the request for confidential treatment has 
been sufficiently substantiated such that confidential treatment should be granted. Article  6.5 does 
not prescribe the particular steps that investigating authorities should take in order to  assess and 
determine whether "good cause" has been "shown". However, in the context of WTO dispute 
settlement, a panel may be asked to examine a claim under Article  6.5 as to whether an investigating 
authority properly examined and determined that "good c ause" had been shown in granting 
confidential treatment to certain information. This examination by a panel should be based on the 
                                                
1037 Korea's other appellant's submission, para.  327. Similarly, Korea argues:  
In light of the fact th at Article  6.5 only requires investigating authorities to satisfy themselves 
that good cause is shown before treating the information in question as confidential, [the] KTC 
was not obliged to make specific statements about each of the requests for confiden tiality other 
than to satisfy itself that good cause was shown before treating the information in question as 
confidential.  
(Ibid., para.  315) 
1038 Appellate  Body Report, EC – Fasteners (China) , para.  537. With regard to the difference between 
the two types of information, the Appellate  Body indicated in EC – Fasteners (China)  that the question whether 
information is "by nature" confidential depends on the content of the information. Confidentiality of such 
information "will often be readily apparent", as the  illustrative examples provided in Article  6.5 show. (Ibid., 
para. 536) Information that is "provided on a confidential basis" is not necessarily confidential by reason of its 
content, but rather, confidentiality arises from the circumstances in which it i s provided to the authorities. 
According to the Appellate  Body, these two categories may, in practice, overlap.  (Ibid.)  
1039 Appellate  Body Report, EC – Fasteners (China) , para.  537. The Appellate  Body elaborated that, 
"[p]ut another way, 'good cause' must de monstrate the risk of a potential consequence, the avoidance of which 
is important enough to warrant the non -disclosure of the information." (Ibid.)  
1040 Appellate  Body Report, EC – Fasteners (China) , para.  537. 
1041 Appellate  Body Report, EC – Fasteners (China) , para.  539. In making its assessment, "the 
investigating authority must seek to balance the submitting party's interest in protecting its confidential 
information with the prejudicial effect that the non -disclosure of the information may have on the trans parency 
and due process interests of other parties involved in the investigation to present their cases and defend their 
interests." (Ibid. (fn  omitted))  
1042 Appellate  Body Report, EC – Fasteners (China) , para.  539. 
1043 Appellate  Body Report, EC – Fasteners (C hina), para.  539. 
1044 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.97. (fn  omitted)  
 WT/DS504/AB/R  
 
- 120 - 
 
  investigating authority's "published report and its related supporting documents"  in which the 
assessment of "good cause" mus t be discernible .1045 
5.400.   Korea maintains that the Panel erred in the interpretation of Article  6.5 "when considering 
that investigating authorities must make statements in the record demonstrating that 'good cause' 
was assessed and found to exist for the confidential treatment of certain pieces or categories of 
information" .1046 In Korea's view, investigating authorities are simply not required to make an 
express "statement" as to whether good cause is shown. Instead, under Article  6.5, "an authority 
must sat isfy itself (i.e.  'ensure') that good cause is shown before treating the information in question 
as confidential."1047 
5.401.   We turn to examine the Panel's articulation of the legal standard under Article  6.5 as it 
relates to Korea's argument. The Panel stated that  "[s]howing good cause is … a 'condition precedent 
for according confidential treatment to information submitted to an authority'."1048 The Panel added 
that "'good cause' means a reason that is sufficient to justify withholding information  from both the 
public and the other parties to the investigation, and that a showing of 'good cause' involves 'a 
demonstration of a risk of a potential consequence, the avoidance of which is important enough to 
warrant the non -disclosure of the information'."1049 In addition, th e Panel indicated that "[t]here is 
no explicit requirement in Article  6.5 that a showing of good cause be made in respect of each 
individual item of information."1050 Thus, "good cause may be shown in respect of general categories 
of information."1051 At the sam e time, the Panel highlighted that, "if an investigating authority treats 
as confidential information in respect of which no good cause has been shown, that investigating 
authority acts inconsistently with its obligation under Article  6.5."1052 
5.402.   As we see it, in articulating the legal standard under Article  6.5, the Panel did not pronounce 
on the specific manner in which investigating authorities should specify that "good cause" was shown 
when granting confidential treatment to certain information. Under Article 6.5, an investigating 
authority is required to assess objectively whether the request for confidential treatment has been 
sufficiently substantiated such that "good cause" has been shown. The fact that the investigating 
authority has conducted this objec tive assessment must be discernible from its published report or 
related supporting documents. In our view, the Panel's articulation comports with the legal standard 
under Article  6.5, as described above. Consequently, we do not consider that the Panel com mitted 
legal error in its interpretation of Article  6.5 of the Anti -Dumping Agreement . 
5.403.   Korea further argues that the Panel erred in finding that "[the] KTC failed to show that good 
cause was shown for certain pieces of evidence as there was no evidence on the record 'linking the 
information for which confidential treatment was granted to the categories of confidential treatment 
identified in Korean law'."1053 Korea maintains that, based on a proper application of Article  6.5, the 
KTC was not obliged to make specific statements about each of the requests for confidentiality other 
than to satisfy itself that good cause was shown before treating the information i n question as 
confidential.1054 
5.404.   To the extent that Korea is suggesting that an investigating authority would comply with 
Article  6.5 in a situation where there is  no indication  on the record establishing that such authority 
conducted an objective assessment a s to whether good cause was shown, we disagree. Under 
Article  6.5, the fact that an investigating authority objectively assessed and determined that "good 
cause" was "shown" must be discernible  from its published report or related supporting documents. 
                                                
1045 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.97. 
1046 Korea's other appellant's submission, para.  326. 
1047 Korea's other appellant's submission, para.  327. 
1048 Panel  Report, para.  7.423 (quoting Appellate  Body Report,  EC – Fasteners (China) 
(Article  21.5 – China) , para.  5.38).  
1049 Panel  Report, para.  7.423 (quoting Appellate  Body Report, EC – Fasteners (China) 
(Article 21.5 – China) , para.  5.37; referring to Appellate  Body Report, EC – Fasteners (China) , para.  537).  
1050 Panel  Report, para.  7.424.  
1051 Panel  Report, para.  7.424.  
1052 Panel  Report, para.  7.424.  
1053 Korea's other appellant's submission, para.  315 (quoting Panel  Report, para.  7.436).  
1054 Korea's other appellant's submission, para.  330. 
 WT/DS504/AB/R  
 
- 121 - 
 
  Without such indication, we fail to see how a panel would be expected to review a claim under 
Article  6.5 of the Anti -Dumping Agreement .  
5.405.   Moreover, Korea asserts that the applicants submitted non -confidential summaries, which 
were prepared by deleting from th eir submissions the information with respect to which they sought 
confidential treatment. According to Korea, in submitting these non -confidential summaries, the 
provider of the information "implicitly assert[ed] that such deleted information falls within the 
categories of 'confidential information' specifically set forth in the relevant laws in Korea (in 
particular, the Enforcement Decree and Enforcement Rule of the Customs Act of Korea), or 
recognized as such in Korea's anti -dumping practice".1055 Korea furt her submits that, in the 
underlying investigation, when the KTC received such non -confidential summaries from the 
applicants, it regarded such summaries as a request by the applicants that the deleted information 
be treated as confidential, and "it objecti vely assessed whether there was indeed 'good cause' by 
confirming whether the deleted information fell within a category of confidential information 
enumerated in the relevant Korean laws."1056 
5.406.   Japan considers that, contrary to Korea's assertions, the Panel r ightly found that there is no 
evidence on the record indicating that a showing of good cause was required by the authorities, or 
made by the applicants, prior to the KTC's decision to grant confidential treatment.1057 Moreover, 
Japan asserts that, while a Mem ber's legislation may set out specific categories of information for 
which confidential treatment will normally be granted, this is not sufficient to comply with Article  6.5. 
Indeed, for Japan, the existence of such legislation "does not relieve the invest igating authority of 
its obligation under Article  6.5 to determine that 'good cause' has been 'shown' to justify the 
confidential treatment requested by the submitting party".1058 Japan argues that  there is no 
indication on the record that, in granting confid ential treatment, either the applicants had specified 
or the Korean investigating authorities had taken into account whether the information in question 
fell into any of the enumerated categories under Korean law.1059 
5.407.   As we understand it, Korea's claim that t he Panel erred in finding an inconsistency with 
Article  6.5 is based on two related arguments regarding the conduct of the interested parties in the 
underlying investigation and the role of the KTC. We address each of these arguments in turn.  
5.408.   With respect to the showing of good cause by interested parties, Korea's position is that, in 
providing non -confidential summaries by way of deleting the relevant information from their 
submissions1060, the providers of the information "implicitly" asserted that such dele ted information 
fell within the categories of "confidential information" set forth in the relevant Korean laws. As a 
consequence of that "implicit" assertion, Korea argues, "good cause" was "shown" for granting 
confidential treatment to that information.  
5.409.   As asserted by Korea, under its relevant legislation, certain categories of information are 
entitled to confidential treatment in anti -dumping investigations. In this regard, the Panel specified 
that, "under the relevant Korean legislation ( Article  15 of the Enforcement Rule of the Customs Act ), 
the following information is entitled to confidential treatment in anti -dumping investigations, 
because its disclosure may infringe the interests of the person supplying the information or another 
interested party: (a)  costs of production; (b) accounting materials which have not been made public; 
                                                
1055 Korea's other appellant's submission, para.  331. (fn  omitted)  
1056 Korea's other appellant's submission, para.  332 (refe rring to Korea's first written submission to the 
Panel, para.  337). Korea adds that, "in applying the relevant provisions of the Korean law on confidential 
treatment of information, [the] KTC also considered that the requested confidential information [was ] 'by 
nature' commercially -sensitive information … which would likely be regularly treated as confidential in 
anti-dumping investigations." (Ibid., para.  333) 
1057 Japan's appellee's submission, para.  170 (referring to Panel  Report, para.  7.434).  
1058 Japan's ap pellee's submission, para.  172 (referring to Panel  Report, para.  7.438).  
1059 Japan's appellee's submission, para.  172. 
1060 The applicants filed "Disclosed", or public, versions of at least three of their written submissions (the 
investigation application dated 23  December  2013, the summary of opinion from attorneys dated 
23 October  2014, and the rebuttal opinion of applicants dated 13  November  2014) from which certain 
information was redacted. With respect to these submissions,  in the course of the investigation, the responding 
companies had access only to the redacted versions. (Panel  Report, para.  7.431) Korea argued before the 
Panel that the version of the applicants' submissions from which confidential information was deleted 
constitutes the non -confidential summary required by Article  6.5.1. (Panel  Report, para.  7.442 (referring to 
Korea's first written submission to the Panel, paras.  341-343; response to Panel question No. 65(a)))  
 WT/DS504/AB/R  
 
- 122 - 
 
  (c) name, address, and trade volumes of trade partners; (d) matters concerning the provider of 
confidential information; and (e) other materials adequately deemed as confidential."1061 The Panel 
further indicated that "[t] he legislation also provides that information that is by nature deemed 
confidential or that is submitted by the interested party on a confidential basis, showing good cause, 
shall not be disclosed by the  Korean Investigating Authorities without an explicit consent of the 
provider."1062 
5.410.   However, while  the Panel did not see a "reason a priori  why a Member's legislation may not 
set out specific categories of information for which confidential treatment will nor mally be 
granted"1063, it was ultimately not convinced that, in the present case, the existence of such a list 
sufficed to establish "good cause" for the confidential treatment of the information at issue. Indeed, 
the Panel highlighted that "there is no indic ation on the record that, in granting confidential 
treatment, either the applicants specified, or the Korean Investigating Authorities took into account, 
whether the information in question fell into any of those categories."1064 Similarly, the Panel found 
that "[t] here is also nothing specific in any of the[] three written submissions [ from which certain 
information was redacted] linking the redacted information to any of the categories laid out in 
Article  15 of the Enforcement Rule of the Customs Act."1065 Moreover, the Panel went on to add that 
"some of the categories described in the [Korean] legislation are so general (for example: accounting 
materials which have not been made public; matters concerning the provider of confidential 
information; or other mater ials adequately deemed as confidential) that the mere invocation of a 
specific category might in itself be insufficient to substantiate the alleged good cause for confidential 
treatment."1066 
5.411.   On the basis of the above reasons, the Panel rejected Korea's argum ent that the applicants 
had made a showing of "good cause" in the underlying investigation by "implicitly" indicating that 
the redacted information fell within the categories of "confidential information" set forth in the 
relevant Korean laws. In this rega rd, we recall that "a party seeking confidential treatment for 
information must make its 'good cause' showing to the investigating authority upon submission of 
the information."1067 We doubt that an "implicit" indication by way of redacting certain informatio n 
from a submission would suffice for establishing such a showing of good cause. In our view, the 
mere redaction of information does not establish, in and of itself, that such information falls within 
certain legal categories for confidential information, let alone that there is good cause for treating 
certain information as confidential. Thus, we share the Panel's view that, although Korea's relevant 
legislation sets out certain categories of information entitled to confidential treatment, a total 
absence of any indication in the underlying investigation as to how the information redacted from 
the submissions relates to the general categories of information set out in the law appears 
insufficient to demonstrate the showing of good cause by the interested pa rties. 
5.412.   Turning to Korea's argument regarding the role played by the KTC, Korea's position is that, 
when the KTC received such non -confidential summaries, it objectively assessed whether there was 
indeed "good cause" by confirming whether the deleted inform ation fell within a category of 
confidential information set out in the relevant Korean laws.1068 Korea further contends that, "[i]n 
applying the relevant provisions of the Korean law on confidential treatment of information, [the] 
KTC also considered that th e requested confidential information [was] by nature 
'commercially -sensitive information (such as profit or cost data or proprietary customer information) 
that is not typically disclosed in the normal course of business and which would likely be regularly 
treated as confidential in anti -dumping investigations'."1069 
                                                
1061 Panel  Report, para.  7.430 (referring to Arti cle 15 of the Enforcement Rule of the Customs Act 
(Panel  Exhibit KOR -34b)).  
1062 Panel  Report, para.  7.430.  
1063 Panel  Report, para.  7.438.  
1064 Panel  Report, para.  7.438.  
1065 Panel  Report, para.  7.432 (referring to Korea's response to Panel question No. 113, para.  104).  
1066 Panel  Report, para.  7.438. (fn  omitted)  
1067 Appellate  Body Report, EC – Fasteners (China) , para.  539. 
1068 Korea's other appellant's submission, para.  332 (referring to Korea's second written submission to 
the Panel, para.  337).  
1069 Korea's other appellan t's submission, para.  333 (quoting Appellate  Body Report, EC – Fasteners 
(China) , para.  536).  
 WT/DS504/AB/R  
 
- 123 - 
 
  5.413.   Before the Panel, Korea also presented this line of argumentation.1070 However, the Panel 
was not convinced , given that it found no supporting evidence on the record.1071 In particular, the 
Panel pointed  out that, "[w]hile such a procedure [by the KTC] may be sufficient to satisfy the 
requirements of Article  6.5, in the absence of anything in the submissions themselves, or evidence 
otherwise on the record, linking the information for which confidential treatment was granted to the 
categories of confidential information identified in Korean law, [it could not] conclude that the Korean 
Investigating Authorities actually engaged in the asserted procedure."1072 For the foregoing reasons, 
the Panel found that, with respect to the 38 items of information identified by Japan, the submitters 
of the information did not show good cause for the confidential treatment of that information. 
Consequently, the Panel concluded that, with respect to the informati on at issue, the Korean 
investigating authorities  did not act consistently with Article  6.5 of the Anti -Dumping  Agreement.1073 
5.414.   In our view, the Panel's analysis is consistent with Article  6.5, as interpreted by the 
Appellate  Body in past disputes. Indeed, the  Panel maintained that " the existence in the legislation 
of defined categories of information that will normally be treated as confidential does not relieve the 
investigating authorities of their obligation to determine that good cause has been shown to ju stify 
the confidential treatment requested by the submitting party."1074 This is consistent with the 
Appellate  Body's statement that "[t]he obligation remains with the investigating authority to 
examine objectively the justification given for the need for con fidential treatment"1075, and that, to 
comply with this obligation, "[t]he authority must objectively assess the 'good cause' alleged … and 
scrutinize the party's showing" in order to determine whether the party has substantiated its request 
for confidential treatment.1076 On appeal, Korea offers no arguments challenging the Panel's factual 
findings indicating that there is nothing on the record of the underlying investigation establishing 
that the Korean investigating authorities objectively assessed whether goo d cause had been "shown" 
before granting the confidential treatment. Given those findings by the Panel, we are unable to agree 
with Korea's argument.1077 
5.415.   Korea's position is ultimately premised on the erroneous understanding that an investigating 
authority wo uld comply with Article  6.5 merely by "satisfy[ing] itself that good cause was shown", 
even in a situation where there is  no indication  in an investigating authority's published report or its 
related supporting documents that the authority conducted an obj ective assessment as to whether 
good cause was shown. We consider that the Panel correctly rejected this position. The Panel 
observed that " there is no evidence on the record linking the information for which confidential 
treatment was granted to the categ ories of information warranting confidential treatment identified 
in Korean law."1078 The Panel emphasized that, i n this situation, it could not "conclude that the 
Korean Investigating Authorities actually engaged in a consideration of whether the submitters of 
the information had shown good cause for confidential treatment of the information in question".1079 
In our view, the Panel's decision to base its conclusion with respect to Japan's claim under Article  6.5 
on the information found on the Korean investigating authorities' published report and related 
supporting documents is consistent with the legal standard under Article  6.5. 
5.416.   In sum, in articulating the legal standard under Article  6.5, the Panel did not pronounce on 
the specific manner in which investigating authorities should specify that "good cause" was shown 
when granting confidential treatment to certain information. Under Article  6.5, an investigating 
authority is required to assess objectively whether the request for confidential treatment has been 
sufficiently substantiated such that "good cause" has been shown. The fact that the investigating 
authority has conducted this objective assessment must be discernible  from its published report or 
                                                
1070 See Panel  Report, para.  7.435 (quoting Korea's response to Panel question No. 69).  
1071 Panel  Report, para.  7.436.  
1072 Panel  Report, para.  7.436.  
1073 Panel  Report, pa ra. 7.441.  
1074 Panel  Report, para.  7.438.  
1075 Appellate  Body Report, EC – Fasteners (China) , para.  539. 
1076 Appellate  Body Report, EC – Fasteners (China) , para.  539. 
1077 Korea's other appellant's submission, para.  332 (referring to Korea's first written submission  to the 
Panel, para.  337).  
1078 Panel  Report, para.  7.440. The Panel further noted that there was no evidence to suggest that "the 
Korean Investigating Authorities themselves undertook to link the information for which confidential treatment 
was sought to the  categories defined in Korean legislation and thereby determine whether good cause for 
confidential treatment existed." (Ibid.)  
1079 Panel  Report, para.  7.440.  
 WT/DS504/AB/R  
 
- 124 - 
 
  relate d supporting documents. The Panel's articulation comports with the legal standard under 
Article  6.5. Consequently, we find that the Panel did not err in its interpretation of Article  6.5 of the 
Anti-Dumping Agreement . 
5.417.   Furthermore, with respect to the inves tigation at issue, the Panel stated that it could not 
"conclude that the Korean Investigating Authorities actually engaged in a consideration of whether 
the submitters  of the information had shown good cause for confidential treatment of the information 
in question".1080 Korea argues that, in providing non -confidential summaries by way of deleting the 
relevant information from their submissions, the providers of the information "implicitly" asserted 
that such deleted information fell within the categories of " confidential information" set forth in the 
relevant Korean laws. In Korea's view, as a consequence of that "implicit" assertion, "good cause" 
was "shown" for granting confidential treatment to that information. As noted, the Panel was not 
convinced by this  argument because there is no evidence on the record "linking the information for 
which confidential treatment was granted to the categories of information warranting confidential 
treatment identified in Korean law" .1081 Neither is there evidence suggesting  that "the Korean 
Investigating Authorities themselves undertook to link the information for which confidential 
treatment was sought to the categories defined in Korean legislation and thereby determine whether 
good cause for confidential treatment existed."1082 Given these Panel findings, we disagree with 
Korea's assertion that , "when [the] KTC received information that was considered confidential by 
the interested parties, it objectively assessed whether there was indeed 'good cause' by confirming 
whether the deleted information fell within a category of confidential information enumerated in the 
relevant Korean laws."1083 Consequently, we find that the Panel did not err in its application of 
Article  6.5 of the Anti -Dumping Agreement . 
5.418.   For the foregoing  reasons, we uphold  the Panel's finding, in paragraphs 7.441, 7.451, 
and 8.4.b of the Panel Report, that Japan demonstrated that the Korean investigating authorities 
acted inconsistently with Article  6.5 of the A nti-Dumping  Agreement  with respect to their treatment 
of information provided by the applicants as confidential without requiring that good cause be shown.  
5.4.2.2   Article  6.5.1 of the Anti -Dumping Agreement  
5.4.2.2.1   The Panel's findings  
5.419.   Before the Panel, Japan asserted that, w ith respect to certain documents, the KTC failed to 
require that submitting parties provide a non -confidential summary of the information that was 
treated as confidential or to show why such a summary  could not be provided, as required under 
Article  6.5.1  of the Anti -Dumping Agreement .1084  
5.420.   The Panel indicated that the issue before it under Article  6.5.1 was whether, w ith respect to 
certain information, the KTC failed to require that the submitting parties provide a non -confidential 
summary of information for which confidential treatment was sought.1085 In this regard, Korea 
argued before the Panel that  the version of the applicants' submissions from which confidential 
information was deleted constituted the non -confidential summary required by Article  6.5.1.1086 
5.421.   The Panel  began by noting that the obligation in Article  6.5.1 falls on the investigating 
authorities. Thus, the Panel emphasized that it is incumbent on the investigating authorities to 
                                                
1080 Panel  Report, para.  7.440.  
1081 Panel  Report, para.  7.440.  
1082 Panel  Report, para.  7.440.  
1083 Korea's other appellant's submission, para.  332 (referring to Korea's first written submission to the 
Panel, para.  337).  
1084 Panel  Report, para.  7.391.  
1085 Panel  Report, para.  7.427. The Panel further specified that, because the a pplicants did not argue 
that the confidential information was not susceptible of summary, the question before it was only whether the 
KTC failed to require that the applicants provide a non -confidential summary of the information for which 
confidential tre atment was sought, and not whether the KTC should have required a showing of why such 
information was not susceptible of summary. (Ibid., para.  7.442)  
1086 Panel  Report, para.  7.442.  
 WT/DS504/AB/R  
 
- 125 - 
 
  ensure that, when information is treated as confidential, a proper non -confidential summary is 
provided by the party submitting the confidential information.1087 
5.422.   With respect  to the underlying investigation, t he Panel noted that the "Disclosed" versions 
of the three communications submitted by the appl icants and identified by Japan (the investigation 
application dated 23  December  2013, the summary of opinion from attorneys dated 
23 October  2014, and the rebuttal opinion of applicants dated 13  November  2014)  have entire 
sections from which information wa s removed, without any narrative to summarize the specific 
information deleted from the text.1088 The Panel noted that the information redacted from the 
submissions includes a significant amount of important data, such as information relating to the 
productio n and sales of the domestic like product and various economic indicators regarding the 
state of the domestic industry.1089 
5.423.   The Panel then addressed several arguments advanced by Korea. First, Korea argued that 
Article  6.5.1 does not require a non -confidential  summary to be provided for every piece of data 
included in a submission. The Panel considered that, while there need not be a non -confidential 
summary of, for instance, each individual data point reported in a table or chart, a non -confidential 
summary of  the information must nonetheless be provided. Second, the Panel disagreed with Korea's 
argument that Japan did not claim due process violations or the lack of a sufficient opportunity for 
the interested parties to defend their interests, finding instead t hat establishing a violation of 
Article  6.5.1 does not require Japan to substantiate such claims. Finally, the Panel rejected Korea's 
assertion that the KTC provided descriptive narratives of the information at issue subsequent to the 
filing of the submiss ions, thereby ensuring a proper understanding of the substance of the 
information. In the Panel's view, the subsequent provision of a non -confidential summary by the 
investigating authority does not absolve it of having failed to comply with Article  6.5.1 in the first 
instance.1090 
5.424.   The Panel did not exclude a priori  that, in some circumstances, a redacted version of a 
document from which the submitting party has deleted certain information may, in and of itself, 
constitute the necessary non -confidential summar y of the information treated as confidential. 
However, the Panel noted that, in the present case, "the documents in question contain entire 
sections from which the data has been redacted"1091, without including any narrative that attempts 
to summarize the red acted information. In the Panel's view, "[i]n the complete absence of data, and 
with no narrative summary with respect to the deleted information, the 'Disclosed' versions of the 
three communications identified by Japan cannot be said to contain a summary in sufficient detail 
to 'permit a reasonable understanding of the substance of the information submitted in 
confidence'."1092 
5.425.   On this basis, the Panel concluded that, "[b]y failing to require that the submitting parties 
provide a sufficient non -confidential s ummary of the information in question, the Korean 
Investigating Authorities acted inconsistently with Article  6.5.1 of the Anti-Dumping  Agreement."1093 
5.4.2.2.2   Whether the Panel erred in its application of Article  6.5.1 of the 
Anti-Dumping  Agreement  
5.426.   Korea submits that the Panel erred in its application of Article  6.5.1 by finding that the KTC 
failed to require the applicants to furnish non -confidential summaries of the information submitted 
in confidence. According to Korea, the non -confidential summa ries submitted by the applicants were 
in sufficient detail to permit a reasonable understanding of the substance of the confidential 
information.1094 Korea maintains that the KTC's longstanding practice is to procure a non -confidential 
                                                
1087 Panel  Report, para.  7.444 (referring to Panel  Report, EC – Fasteners (Chin a), para.  7.515). The 
Panel also observed that, "[w]hen information has been treated as confidential inconsistently with Article  6.5, 
the issue of whether a proper non -confidential summary was provided becomes irrelevant." (Ibid., para.  7.443)  
1088 Panel  Report, paras.  7.445 and 7.449.  
1089 Panel  Report, para.  7.445.  
1090 Panel  Report, paras.  7.446 -7.447 (referring to Korea's first written submission to the Panel, 
paras.  346-348). 
1091 Panel  Report, para.  7.449.  
1092 Panel  Report, para.  7.449.  
1093 Panel  Report, para.  7.450.  
1094 Korea's other appellant's submission, para.  349. 
 WT/DS504/AB/R  
 
- 126 - 
 
  summary of the confiden tial information from the interested parties by way of requiring the "public 
versions" of the submissions. According to Korea, in the "public versions" of the submissions from 
the Korean producers that were "proactively disclosed" by the KTC1095, "certain non -confidential 
descriptive narratives are found with respect to all confidential information, and these narratives 
permitted a reasonable understanding of the substance of the information and thus enabled 
interested parties to defend their interests."1096 
5.427.   Japan responds  that, contrary to Korea's assertion, the non -confidential summaries 
submitted by interested parties did not contain sufficient detail to permit a reasonable understanding 
of the substance of the confidential information. According to Japan, the "public versions" of the 
documents at issue contained entire sections from which the key information had been redacted and 
there was no narrative that attempted to summarize the redacted information.1097 Therefore, in 
Japan's view, the Panel correctly found t hat the KTC failed to require non -confidential summaries in 
"sufficient detail" to convey the substance of the information.1098 
5.428.   Article  6.5.1 of the Anti -Dumping  Agreement governs two related situations. First, this 
provision sets out that "[t]he authorities shall require interested parties providing confidential 
information to furnish non -confidential summaries thereof." With respect to the content of those 
summaries, Article  6.5.1 elaborates that they "shall be in sufficient detail to permit a reasonable 
understanding of the substance of the information submitted in confidence". Second, Article  6.5.1 
further stipulates that "[i]n exceptional circumstances, such parties may indicate that such 
information is not susceptible of summary. In such exceptional circu mstances, a statement of the 
reasons why summarization is not possible must be provided."  
5.429.   In the present dispute, the Panel indicated that the claim at hand concerns only the first of 
those situations, that is, whether the investigating authorities require d the submission of 
non-confidential summaries that were in sufficient detail to permit a reasonable understanding of 
the substance of the information submitted in confidence. Indeed, the Panel noted that, "[b]ecause 
the applicants did not argue that the c onfidential information was not susceptible of summary, the 
question before [it was] only whether the KTC failed to require that the applicants provide a 
non-confidential summary of the information for which confidential treatment was sought, and not 
wheth er the KTC should have required a showing of why such information was not susceptible of 
summary."1099 On appeal, Korea does not dispute the Panel's understanding of the scope of the claim 
under Article  6.5.1.1100 
5.430.   Thus, the central issue underlying Korea's claim  on appeal is whether the Panel committed 
legal error under Article  6.5.1 in finding that the Korean investigating authorities failed to require 
that the parties submitting confidential information provide a "sufficient" non -confidential summary 
of the inf ormation at issue. Indeed, on appeal, Korea's main argument is that the "KTC did not fail 
to require the applicants to provide sufficient non -confidential summaries of the confidential 
information" given that "[t]he non -confidential summaries were in suffi cient detail to permit a 
reasonable understanding of the substance of the confidential information."1101 
5.431.   We note that, as found by the Panel, "the applicants filed 'Disclosed', or public, versions of 
at least three of their written submissions (the investigat ion application dated 23  December  2013, 
                                                
1095 Korea's other appellant's submission, para.  353. 
1096 Korea's other appellant's submission, para.  352. 
1097 Japan's appellee's submission, para.  174. Japan specifies that, in some cases, tables were provided 
but all data contained therein was deleted; in other cases, percentage changes were shown but actual figures 
were deleted. (Ibid. (referring to Panel  Repor t, para.  7.449))  
1098 Japan's appellee's submission, para.  174 (quoting Panel  Report, para.  7.449).  
1099 Panel  Report, para.  7.442.  
1100 In its other appellant's submission, Korea states that "[t]here can certainly be situations when there 
is no meaningful way of s ummarizing confidential data and, thus, the only option is to redact such information 
in full (e.g. by indicating 'XXX')". (Korea's other appellant's submission, para.  350) While this statement might 
suggest that Korea invokes "exceptional circumstances" p ursuant to Article  6.5, Korea nonetheless clarified at 
the oral hearing that its position is that the KTC provided non-confidential summaries of the confidential 
information at issue by way of requiring "public versions" of the applicants' submissions. Thu s, Korea agrees 
that the claim at hand should be evaluated in light of the first situation covered by Article  6.5.1 and therefore 
does not involve examining whether there were any "exceptional circumstances" in the underlying investigation 
such that the in formation at issue was not susceptible of summary.  
1101 Korea's other appellant's submission, para.  349. 
 WT/DS504/AB/R  
 
- 127 - 
 
  the summary of opinion from attorneys dated 23  October  2014, and the rebuttal opinion of 
applicants dated 13  November  2014) from which certain information was redacted either by totally 
removing it or by replacing it  with 'X' or asterisks."1102  
5.432.   Korea argued before the Panel that "the version of the applicants' submissions from which 
confidential information was deleted constitutes the non -confidential summary  required by 
Article  6.5.1."1103 In this regard, the Panel stated that it did not "exclude a priori  that in some 
circumstances a redacted version of a document from which the submitting party has deleted certain 
information may in itself constitute the necessary non -confidential summary of information treated 
as confidential" .1104 The Panel added that "[w]hether such a document satisfies the requirements in 
Article  6.5.1, and specifically whether it is in sufficient detail to 'permit a reasonable understanding 
of the substance of the informa tion submitted in confidence', is something that would have to be 
determined on a case -by-case basis."1105 We agree with these statements by the Panel.  
5.433.   On appeal, Korea maintains that the three documents cited by Japan contain 
"non-confidential descriptive na rratives … with respect to all confidential information", which 
"permitted a reasonable understanding of the substance of the information and thus enabled 
interested parties to defend their interests".1106 The Panel rejected this view. In particular, the Pane l 
noted that " the 'Disclosed' versions of the three communications identified by Japan have entire 
sections from which information was removed."1107 The Panel added that "[t]he information redacted 
from the submissions includes a significant amount of importa nt data."1108 By way of example, t he 
Panel noted that, "in some cases tables are provided from which all data was deleted; in other cases, 
percentage changes are shown in the tables, but the actual figures were deleted. There are also 
sections of text from wh ich data was redacted."1109 The Panel also pointed out that "[t]here is no 
narrative in the 'Disclosed' version to summarize the specific information deleted from the text."1110 
The Panel noted that the information redacted from the submissions refers to,  inter alia, the 
following:  
(a) volumes of domestic production of the like product, including percentages of the 
domestic production represented by the complainants; (b) volumes of domestic 
consumption; (c) market shares in the Korean domestic market; (d) import price of the 
product under investigation; (e) production capacity and utilization by the domestic 
industry; (f)  domestic sales; (g) inventories [,] volumes [,] and ratio for the domestic 
industry; (h) profitability for the domestic industry; (i) production c osts for the domestic 
industry; (j) investments in equipment and research and development by the domestic 
industry; (k) employment and wages in the domestic industry; (l) productivity in the 
domestic industry; (m) cash flow for the domestic industry; (n) p rices of raw materials; 
(o) quantity and value of imports of the product under investigation; and (p) production 
capacity and utilization by the Japanese industry.1111 
5.434.   In light of the above considerations, the Panel found that, "[i]n the complete absence of 
data, and with no narrative summary  with respect to the deleted information, the 'Disclosed' versions 
of the three communications identified by Japan cannot be said to contain a summary in sufficient 
detail to 'permit a reasonable understanding of the subst ance of the information submitted in 
confidence'."1112 
5.435.   In the above passages from the Panel  Report , the Panel made findings of fact with respect 
to the content of the documents that were treated as the "non -confidential summaries" in the 
underlying investigation. In particular, t he Panel pointed out that "the 'Disclosed' versions of the 
                                                
1102 Panel  Report, para.  7.431.  
1103 Panel  Report, para.  7.442 (referring to Korea's first written submission to the Panel, 
paras.  341-343; response to Panel qu estion No. 65(a)). (emphasis added)  
1104 Panel  Report, para.  7.448.  
1105 Panel  Report, para.  7.448 (referring to Korea's response to Panel question No. 68).  
1106 Korea's other appellant's submission, para.  352. 
1107 Panel  Report, para.  7.445.  
1108 Panel  Report, para.  7.445.  
1109 Panel  Report, para.  7.449. (fns  omitted)  
1110 Panel  Report, para.  7.445.  
1111 Panel  Report, para.  7.445.  
1112 Panel  Report, para.  7.449. (emphasis added)  
 WT/DS504/AB/R  
 
- 128 - 
 
  three communications identified by Japan have entire sections from which information was 
removed"1113, which cover " a significant amount of important data".1114 The Panel a lso highlighted 
that "[t]here is no narrative in the 'Disclosed' version to summarize the specific information deleted 
from the text."1115 Korea does not challenge the Panel's appreciation of the facts under Article  11 of 
the DSU. Instead, Korea repeats certa in arguments that the Panel had already rejected without 
explaining why the Panel's analysis constitutes a misapplication  of Article  6.5.1. We recall that 
Article  6.5.1 mandates the investigating authority to require a non -confidential summary that 
contain s "sufficient detail to permit a reasonable understanding of the substance of the information 
submitted in confidence".1116 In light of the applicable legal standard and the reasoning provided by 
the Panel, we fail to see how the "non -confidential summaries" at issue could satisfy the legal 
standard of being " in sufficient detail to permit a reasonable understanding of the substance of the 
information submitted in confidence". In these circumstances, we disagree with Korea's argument 
that "[the] KTC did not fa il to require the applicants to provide sufficient non -confidential summaries 
of the confidential information."1117 
5.436.   Korea further  argues on appeal that "non -confidential summaries are not required under 
Article  6.5.1 for every single figure and piece of data included in the parties' submissions, regardless 
of the relevant context."1118 This argument was also addressed by the Panel.1119 The Panel stated 
that while " all confidential information must be summarized … this does not mean that there must 
be a non -confident ial summary of, for instance, each individual data point reported in a table or 
chart."1120 As we see it, the Panel did not fault Korea under Article  6.5.1 for failing to disclose 
individual data points. Instead, as noted above, the Panel's conclusion was bas ed on the fact that 
the "non -confidential summaries" did not meet the legal standard under Article  6.5.1 because there 
was a "complete absence of data" and "no narrative summary with respect to the deleted 
information".1121 We are therefore not convinced by Korea's argument.  
5.437.   Korea additionally submits that " Article  6.5.1 does not provide any instruction on the method 
and extent of preparing non -confidential summaries. Thus, investigating authorities are entitled [to] 
certain deference to a reason able degree in accepting or rejecting non -confidential summaries."1122 
In our view, regardless of the degree of deference that an investigating authority may enjoy under 
Article  6.5.1, it must comply with the obligation to require summaries that are "in suffi cient detail 
to permit a reasonable understanding of the information submitted in confidence". Our above 
analysis shows that the Panel correctly found that the "non -confidential summaries" at issue failed 
to meet this legal standard. Therefore, we fail to see anything in this argument by Korea that would 
disturb the Panel's conclusion.  
5.438.   Korea also contends that there was neither a violation of due process rights of the interested 
parties nor a failure to provide interested parties with an opportunity to defe nd their interests. In 
Korea's view, "[i]t is noteworthy that there were no such claims put forward by Japan under 
Article  6.2 or  6.4 of the Anti -Dumping  Agreement."1123 This argument by Korea was also rejected by 
the Panel.1124 For the Panel, "if an investigati ng authority fails to ensure that a non -confidential 
                                                
1113 Panel  Report, para.  7.445.  
1114 Panel  Report, para.  7.445. 
1115 Panel  Report, para.  7.445.  
1116 Appellate  Body Report, EC – Fasteners (China) , para.  542. Article  6.5.1 also contemplates that in 
"exceptional circumstances" confidential information may not be "susceptible of summary". The Appellate  Body 
observed in EC – Fasteners (China)  that, "[i]n such exceptional circumstances, a party may indicate that it is 
not able to furnish a non -confidential summary of the information submitted in confidence, but it is 
nevertheless required to provide a 'statement of the rea sons why summarization is not possible'." (Ibid., 
para. 543) 
1117 Korea's other appellant's submission, para.  349. 
1118 Korea's other appellant's submission, para.  352. 
1119 Before the Panel, Korea argued that "Article  6.5.1 does not require that a non -confidential  summary 
must be provided for every piece of data included in a submission." (Panel  Report, para.  7.446 (referring to 
Korea's first written submission to the Panel, para.  346))  
1120 Panel  Report, para.  7.447.  
1121 Panel  Report, para.  7.449.  
1122 Korea's other appel lant's submission, para.  352. 
1123 Korea's other appellant's submission, para.  353. 
1124 Korea asserted that "Japan [was] not claiming that the due process rights of interested parties were 
violated or that interested parties did not have a sufficient opportunit y to defend their interests." 
(Panel  Report, para.  7.446 (referring to Korea's first written submission to the Panel, para.  347))  
 WT/DS504/AB/R  
 
- 129 - 
 
  summary is submitted, there is no requirement under Article  6.5.1 for a complainant before the WTO 
to demonstrate that the due process rights of interested parties were violated or that interested 
partie s did not have a sufficient opportunity to defend their interests, in order to establish a 
violation."1125 
5.439.   We consider the Panel's reasoning to be in line with the role of due process concerns when 
assessing claims under Article  6.5.1. Indeed, in describing t he legal standard under Article  6.5.1, 
the Appellate  Body stated in EC – Fasteners (China) that, "[w]henever information is treated as 
confidential, transparency and due process concerns will necessarily arise  because such treatment 
entails the withholding  of information from other parties to an investigation."1126 Thus, as we see it, 
the Appellate  Body has rejected the view that a panel's inquiry into whether Article  6.5.1 has been 
breached includes a separate analysis of whether the parties' due process rights have been violated. 
The Panel was therefore correct in rejecting Korea's argument about the relevance of conducting a 
separate  assessment as to whether the due process rights of the interested parties had  been violated 
in order to establish a claim under Article  6.5.1.  
5.440.   Finally, Korea contends that " throughout the underlying investigation, [the] KTC analyzed 
and proactively disclosed the non -confidential summaries of the confidential information submitted 
by the interested parties."1127 Before the Panel, Korea had similarly argued that " the KTC provided 
descriptive narratives with respect to all of the information that Japan identified in its 
communications subsequent to the filing of the submissions, thereby e nsuring a proper 
understanding of the substance of the information."1128 As in previous instances, the Panel disagreed 
with Korea. According to the Panel, "even assuming that the Korean Investigating Authorities 
subsequently provided descriptive narratives of  the information treated as confidential, this would 
not resolve the issue of whether they required the submission of a non -confidential summary from 
the submitter of the information for which confidential treatment was sought. The subsequent 
provision of a non -confidential summary by the investigating authority does not absolve it of having 
failed to comply with Article  6.5.1 in the first instance."1129 
5.441.   In our view, the Panel's reasoning for rejecting Korea's argument is supported by the text 
of Article  of 6.5.1 and relevant Appellate  Body jurisprudence. This provision imposes an obligation 
on investigating authorities with respect to the conduct expected of parties  seeking to obtain 
confidential treatment for certain information, namely "[t]he authorities sha ll require" interested 
parties "to furnish non -confidential summaries" of the relevant information. Thus, under 
Article  6.5.1, the authorities bear the obligation to require non -confidential summaries from the 
parties , and there appears to be no basis for the proposition that the authorities' obligation could be 
fulfilled through summaries provided by the authorities themselves. Consequently, we see no error 
in the Panel's statement that the subsequent  issuance of descriptive narratives of the information 
treated as confidential by the KTC  "would not resolve the issue of whether they required the 
submission of a non -confidential summary from the submitter of the information for which 
confidential treatment was sought".1130 
5.442.   In sum, Article  6.5.1 mandates investi gating authorities to require non -confidential 
summaries from interested parties providing confidential information. These summaries shall be in 
sufficient detail to permit a reasonable understanding of the substance of the information submitted 
in confide nce. In the present dispute, the Panel found that, "[i]n the complete absence of data , and 
with no narrative summary  with respect to the deleted information, the 'Disclosed' versions of the 
three communications identified by Japan cannot be said to contain a summary in sufficient detail 
to 'permit a reasonable understanding of the substance of the information submitted in 
confidence'."1131 Korea does not challenge the Panel's appreciation of the facts under Article  11 of 
the DSU leading to the above finding. Instead, Korea repeats certain arguments that the Panel had 
already rejected without explaining why the Panel's analy sis constitutes a misapplication  of 
Article  6.5.1. In light of the applicable legal standard and the reasoning provided by the Panel, we 
                                                
1125 Panel  Report, para.  7.447.  
1126 Appellate  Body Report, EC – Fasteners (China) , para.  541. (emphasis added)  
1127 Korea's other appe llant's submission, para.  353. 
1128 Panel  Report, para.  7.446 (referring to Korea's first written submission to the Panel, 
paras.  346-348).  
1129 Panel  Report, para.  7.447.  
1130 Panel  Report, para.  7.447. (emphasis added)  
1131 Panel  Report, para.  7.449. (emphasis added)  
 WT/DS504/AB/R  
 
- 130 - 
 
  fail to see how the versions of the submissions from which confidential information had been 
redacted could satisfy the  legal standard of being non -confidential summaries that are "in sufficient 
detail to permit a reasonable understanding of the substance of the information submitted in 
confidence". In these circumstances, we disagree with Korea's argument that "[the] KTC did not fail 
to require the applicants to provide sufficient non -confidential summaries of the confidential 
information."1132 
5.443.   For the foregoing reasons, we uphold  the Panel's finding, in paragraphs 7.450, 7.451, 
and 8.4.c of the Panel Report, that Japan demon strated that the Korean investigating authorities 
acted inconsistently with Article  6.5.1 of the Anti-Dumping  Agreement by failing to require that the 
submitting parties provide a sufficient non -confidential summary of the information for which 
confidentia l treatment was sought.  
5.5  Essential facts 
5.444.   The Panel  found that Japan's claim 10 as listed in its panel request, which concerns the 
disclosure of essential facts, did not meet the requirements of Article  6.2 of the DSU and, 
consequently, was not within its terms of reference.1133  
5.445.   Japan appeals  this finding and requests the Appellate  Body to find that this claim is within 
the Panel's terms of reference. In addition, Japan requests the Appellate  Body to complete the legal 
analysis  and find that the Korean investigating authorities acted inconsist ently with Article  6.9 of the 
Anti-Dumping  Agreement by failing to inform the interested parties of the 14 essential facts relating 
to price effects, the volume of dumped imports, the state of the domestic industry, and causation.1134  
5.446.   Korea, for its part, re quests the Appellate  Body to uphold the Panel's finding under Article  6.2 
of the DSU. Should the Appellate  Body reverse the Panel's finding, Korea argues that the 
Appellate  Body cannot complete the legal analysis.1135  
5.447.   We begin by examining  whether the Panel erred under Article  6.2 of the DSU in finding that 
Japan's claim 10, concerning the disclosure of essential facts, was not within its terms of reference . 
If we reverse the Panel's findings under Article  6.2 of the DSU and find that Japan's claim concerning 
the disclosure of essential facts was within the Panel's terms of reference, we will proceed to examine 
whether the Appellate  Body can complete the legal analysis with respect to Japan's claim that the 
Korean investigating authorities acted inco nsistently with Article  6.9 of the 
Anti-Dumping  Agreement . 
5.5.1   Whether the Panel erred in finding that Japan's claim 10 concerning the disclosure 
of essential facts was not within its terms of reference  
5.448.   In its panel request, Japan claimed that the Korean measu res are inconsistent with Korea's 
obligations under:  
Article  6.9 of the [Anti-Dumping] Agreement because Korea failed to inform the 
interested parties of the essential facts under  consideration which formed the basis for 
the decision to impose definitive a nti-dumping measures[.]  
5.449.   The Panel found that Japan's panel request  merely paraphrase d the language of Article  6.9 
and did not identify the essential  facts allegedly not disclosed or set out any elements that would 
allow the respondent or other Members to h ave any understanding of the scope of the claim. To the 
Panel, a m ere paraphrase of the language of Article  6.9 is insufficient to explain how or why  Japan 
considers the obligation was breached.1136 In the Panel's view, some additional narrative regarding 
the kinds of essential facts allegedly not disclosed should have been included in the panel request 
so as to present the problem clearly.1137 The Panel found support for its conclusion by taking into 
                                                
1132 Korea's other appellant's submission, para.  349. 
1133 Panel Report, para.  7.517.  
1134 Japan's appellant's submission, paras.  326 and 347.  
1135 Korea's appellee's submission, para.  464. 
1136 Panel  Report, para.  7.514.  
1137 Panel  Report, para.  7.515.  
 WT/DS504/AB/R  
 
- 131 - 
 
  account the "broad and diverse scope of the allegations" conta ined in Japan's submissions .1138 The 
Panel thus concluded that Japan's claim under Article  6.9 of the Anti -Dumping  Agreement concerning 
the disclosure of essential facts was not properly within the Panel's terms of reference, and the Panel 
declined to consider it further or resolve it.1139 
5.450.   On appeal, Japan argues that claim 10 of its panel request refers specifically to the failure 
to disclose essential facts and expressly identifie s Article  6.9 as the provision at issue .1140 However, 
the Panel failed to cons ider fully and carefully the "nature and scope" of this obligation, and failed 
to consider the claim in light of the nature of the specific measure being challenged.1141 Japan 
submits that the obligation to disclose essential facts is narrow and well  defined on its face . Thus, 
the nature of the obligation in these circumstances is "sufficient to present the problem clearly".1142 
Japan further argues that the Panel failed to consider the nature of the measure, in particular the 
fact that its claim refers specifica lly to Korea's failure to "inform the interested parties of the essential 
facts under consideration".1143 Japan finally submits that the Panel improperly relied on the phrase 
"how or why" to require the complainant to provide arguments in support of the claim1144, and 
incorrectly relied on its later arguments to support its finding that claim 10 of the panel request does 
not comply with the requirements of Article  6.2.1145  
5.451.   Korea replies that the Panel correctly found that Japan's panel request does not explain how 
or why Japan considers that the Korean investigating authorities failed to inform interested parties 
of the essential facts that formed the basis for the decision to impose anti -dumping measures.1146 
To Korea, it is clear that the lack of clarity in Japan's p anel request prejudiced the preparation of 
Korea's defe nce and violated Korea's essential due process rights in this proceeding.1147 Korea 
argues that the Panel did not fail to consider the nature of the obligation1148 or the nature of the 
measure . Instead, the Panel  considered that an anti -dumping measure could violate Article  6.9 in 
many different ways and thus that it was important for Japan to provide the how and why of the 
specific allegations of violation.1149 Korea further contends that the Panel was aware of  the distinction 
between claims and arguments1150, and did not improperly rely on later arguments because the 
Panel first made its determination on the basis of the panel request, on its face, before turning to 
the later submissions for confirmation.1151 
5.452.   We have indicated in section 5.1.1 above that , in assessing whether a panel request 
comports with the requirements of Article  6.2 of the DSU, a panel must examine a panel request on 
its face, taking into consideration the circumstances of each case. We have also explained that, in 
order to provide the legal basis of the complaint sufficient to present the problem clearly, a panel 
request must plainly connect the challenged measure with the obligation alleged to have been 
breached. In this regard, a complainan t must, as a minimum requirement, list the provisions of the 
covered agreement alleged to have been breached. However, there may be situations in which 
identification of these provisions, in and of itself, may fall short of meeting the legal standard under  
Article  6.2 of the  DSU, for example , where the provision at issue establishes multiple obligations.1152  
5.453.   In the present instance, the Panel nonetheless considered that "[a] mere paraphrase of the 
language of Article  6.9 does not explain how or why Japan cons iders the measures at issue to be 
inconsistent with" this provision.1153 Beyond this conclusion, the Panel did not provide any further 
analysis on the circumstances of this case, such as the nature of the measure or that of the provision 
                                                
1138 Panel  Report, para.  7.516.  
1139 Panel  Report, para.  7.517.  
1140 Japan's appellant's submission, para.  314. 
1141 Japan's appellant's submission, para.  315. 
1142 Japan 's appellant's submission, para.  316. 
1143 Japan's appellant's submission, para.  320. 
1144 Japan's appellant's submission, para.  324. 
1145 Japan's appellant's submission, paras.  325-326. 
1146 Korea's appellee's submission, para.  474. 
1147 Korea's appellee's submission, p ara. 475. 
1148 Korea's appellee's submission, paras.  478-479. 
1149 Korea's appellee's submission, para.  482. 
1150 Korea's appellee's submission, paras.  485-486. 
1151 Korea's appellee's submission, para.  492. 
1152 See para.  5.6 above.  
1153 Panel  Report, para.  7.514. (emphasis original)  WT/DS504/AB/R  
 
- 132 - 
 
  at issue. However, wh ether Japan's claim 10, despite its brevity, fulfils the requirements of 
Article  6.2 of the DSU should be assessed , taking into consideration these circumstances.  
5.454.   With regard to the nature of the measure, we observe that Japan's claim 10 specifically 
refers to the Korean investigating authorities'  failure "to inform the interested parties of the essential 
facts under  consideration which formed the basis for the decision to impose definitive anti -dumping 
measures". Claim 10,  therefore , expressly relates to the alleged  omission to disclose essential facts  
by the Korean investigating authorities in the anti -dumping investigation at issue .  
5.455.   With regard to the nature of the provisions  concerned , Article  6.9 of the 
Anti-Dumping  Agreement prov ides that:  
The authorities shall, before a final determination is made, inform all interested parties 
of the essential facts under consideration which form the basis for the decision whether 
to apply definitive measures. Such disclosure should take place i n sufficient time for the 
parties to defend their interests . 
5.456.   Article  6.9 thus concerns the disclosure of "essential facts" before a final determination is 
made, namely  those facts that are significant in the process of reaching a decision whether to apply 
definitive measures.1154 Therefore, the obligation contained in Article  6.9 is distinct and well  
delineated. It essentially requires the investigating authority to disclose the essential facts to all 
interested parties in a timely manner, that is, before the final determination is made and in sufficient 
time for the parties to defend their interest s. Thus, by identifying the specific aspect of the measure 
at issue under this claim with the degree of precision highlighted above, and by referring to 
Article  6.9 of the Anti -Dumping  Agreement, Japan's claim 10 has plainly connected the challenged 
measure with the provision alleged to have been breached such that the panel request meets the 
requirements of Article  6.2 of the DSU.  
5.457.   We recall, however, that in finding  that the panel request was not sufficiently precise to 
comply with the requirements of Article  6.2 of the DSU, the Panel relied on the following allegations 
in Japan's written submission s that the KTC failed to disclose the essential facts under considera tion 
with respect to:  
a. price effects, specifically: the alleged practices of aggressive marketing, the construction 
of the "reasonable sales price", the interchangeability of the dumped imports and the 
domestic industry's like product, including with respec t to the importance of "system sales" 
in this regard;  
b. the volume of dumped imports, specifically: the actual volumes and market shares of the 
dumped imports, the volume of the dumped imports relative to domestic production, and 
the end -point to end -point comparison of the volume of the dumped imports;  
c. the condition of the domestic industry, specifically: capacity utilization, market share, and 
the profitability of the domestic industry; and  
d. causation, specifically: facts relating to any causal relationsh ip and facts relating to other 
known factors having an impact on the state of the domestic industry such as third 
countries' imports and the export performance of the domestic industry.1155 
5.458.   In our view, these allegations indicate which essential facts, or which categories of essential 
facts, Japan contended that the Korean investigating authorities failed to disclose. The Panel 
therefore appears to have understood that, to comply with the req uirements of Article  6.2 of the 
DSU, when bringing a claim under  Article  6.9 of the Anti -Dumping  Agreement, a complainant is 
required to indicate in its panel request which essential facts, or categories thereof, have not been 
disclosed by the investigatin g authority.  
                                                
1154 Appellate  Body Report, Russia – Commercial Vehicles , para.  5.177. The Appellate  Body has further 
indicated that "[s]uch facts are those that are salient  for a decision to apply definitive measures as well as 
those that are salient for a contrary outcome." (Ibid.)  
1155 Panel  Report, para.  7.516.  WT/DS504/AB/R  
 
- 133 - 
 
  5.459.   As indicated above, however, the identification of Article  6.9 in the panel request, together 
with the identification of the specific aspect of the measure at issue, was sufficient to provide a brief 
summary of the legal basis of the complain t for purposes of Article  6.2 of the DSU. Requiring the 
panel request to include the kind of additional detail suggested by the Panel – such as the specific 
essential facts allegedly not disclosed – would entail the elaboration of the arguments underlying 
Japan's claim, which would, in our view, exceed the requirements to which the complainant is held 
under Article  6.2 of the DSU.  
5.460.   Moreover , we also disagree with Korea's argument that Japan "failed to satisfy even the 
basic obligation of providing any narra tive that presented the problem clearly".1156 In Korea's view, 
although Japan was not required to "set forth the factual and legal reasons and evidence supporting 
its claim", Japan must "explain the 'how or why' of its legal claims" such that its panel reques t could 
"provide[] a narrative to present the problem clearly".1157 However, we fail to see the difference 
between the "factual and legal reasons " supporting the claim, which Korea agrees are not required 
in the panel request , and the explanation of the "how or why" that Korea maintains should have 
been included in the panel request. In our view, by plainly connecting the measure at issue with the 
obligations alleged to have been breached, Japan's panel request provide s a brief summary of the 
legal basis as re quired by Article  6.2 of the DSU.  
5.461.   In sum, Japan's claim 10 concerning the disclosure of essential facts in its panel request 
identifies Article  6.9 of the Anti -Dumping  Agreement as the provision alleged to have been breached 
by Korea. Claim 10 also specifically refers to the Korean investigating authorities'  failure "to inform 
the interested parties of the essential facts under  consideration which formed the basis for the 
decision to impose definitive anti -dumping measures". In addition, Article  6.9 sets forth a distinct 
and well -delineated obligation requiring the investigating authority to disclose the essential facts to 
all interested parties in a timely manner, that is, before the final determination is made and in 
sufficient time for the parties to defend their interest s. Thus, Japan's claim 10 "provide[s] a brief 
summary of the legal basis of the complaint sufficient to present the problem clearly" within the 
meaning of Article  6.2 of the DSU.  
5.462.   For the foregoing  reasons, we find that the Panel err ed in finding that Japan's claim 10 
concerning the disclosure  of essential facts was not within its terms of reference. Consequently, 
we reverse  the Panel's finding , in paragraphs 7.517 and 8.1.f of the Panel Report, and find that 
Japan's claim 10 is withi n the Panel's terms of reference.  
5.5.2   Whether the Appellate  Body  can complete the legal analysis under Article  6.9 of the 
Anti-Dumping  Agreement  
5.463.   Having reversed  the Panel's finding that Japan's claim under Article  6.9 of the 
Anti-Dumping  Agreement is outside the Panel's terms of reference, we turn to Japan's request for 
completion of the legal analysis under this provision.  
5.464.   Japan requests  us to complete the legal analysis and find that Korea acted inconsistently 
with Article  6.9 of the Anti -Dumping  Agreement due to the KTC's failure to disclose the "essential 
facts" before its "final determination".1158 Japan maintains that the KTC violated Article  6.9 because 
of the inadequate manner in which it disclosed certain information to the Japanese res pondents. For 
Japan, "[s]ome of the failures were not to disclose any information at all, even though the KTC would 
ultimately rely on that undisclosed information to make key findings. Some other failures were to 
provide no adequate public summary of cert ain information, which essentially left the parties with 
no disclosure."1159 Japan maintains that, "[f]or both categories the KTC deprived the Japanese 
respondents of the opportunity to defend their interests."1160 
                                                
1156 Korea's appellee's submission, para.  488. 
1157 Korea's appellee's submission, para.  487. (emphasis original)  
1158 Japan 's appellant's submission, para.  347. 
1159 Japan's appellant's submission, para.  334. 
1160 Japan's appellant's submission, para.  334. 
 WT/DS504/AB/R  
 
- 134 - 
 
  5.465.   In Japan's view, the KTC failed to disclose adequately the "essential facts" in the following 
"key disclosure documents": the OTI's Preliminary Report1161, the KTC's Preliminary Resolution1162, 
and the OTI's Interim Report1163. According  to Japan, the Korean investigating authorities failed to 
disclose the foll owing "essential facts", which are grouped into four main themes:  
• [With respect to price effects ]: (1) the alleged "aggressive marketing", (2) the 
construction of the "reasonable sales price", (3) the treatment of "system 
sales", and (4) the interchangeabi lity of the dumped imports and the domestic 
industry's like product;  
• [With respect to volume of dumped imports ]: (5) the actual volumes of [the] 
dumped imports, (6) the market shares of the dumped imports, (7) the volume 
of the dumped imports relative to d omestic production, and (8) the end -point 
to end -point comparison of the volume of the dumped imports;  
• [With respect to the state of the domestic industry ]: (9) capacity utilization of 
the domestic industry, (10) market share of the domestic industry, and (11) 
the profitability of the domestic industry; and [] 
• [With respect to causation ]: (12) facts relating to any causal relationship, 
(13) facts relating to other known factors having an impact on the state of the 
domestic industry such as third countries' i mports, and (14) similar facts about 
the export performance of the domestic industry.1164 
5.466.   Japan argues  that, on the basis of the "relevant facts" set out by the Panel, "there is no 
dispute about the contents of the key disclosure documents: the OTI's Prelimin ary Report 
dated  26 June 2014, the KTC's Preliminary Resolution also dated 26  June 2014, and the OTI's 
Interim Report dated 23  October  2014."1165 In Japan's view, "[t]he only dispute is the legal issue of 
whether the KTC Final Resolution constitutes a 'final determination' of injury for purposes of 
Article  6.9"1166, or whether it constitutes a disclosure document.  
5.467.   Korea responds  that there is no basis for the Appellate  Body to complete the legal analysis, 
given that it can do so only in a situation where there are sufficient factual findings by the Panel or 
undisputed facts on the Panel record.1167 Korea recalls that, in the section of the Panel  Report  entitled 
"Relevant facts", the Panel summarized a number of factual findings made by the Korean 
investigatin g authorities at different stages of the underlying investigation. However, "[t]his section 
does not contain any legal or factual findings by the Panel on which are the 'essential facts' and 
which were the relevant documents to be examined for purposes of Article  6.9."1168 
5.468.   Korea disagrees with Japan's statement that "the status of the KTC Final Resolution is 'a 
legal issue, not a factual issue'."1169 Korea considers that the final disclosure took place in the OTI's 
Final Report and the KTC's Final Resolution, and  that the final decision to adopt measures was taken 
only later by the MOSF. In Korea's view, while the question whether these final documents by the 
OTI and the KTC disclosed the "essential facts" within the meaning of Article  6.9 may well be a legal 
issue, the issue whether these documents were the relevant documents to consider for purposes of 
Article  6.9 is a factual matter on which the Panel did not express a view and is disputed between the 
parties.1170 For these reasons, Korea argues that the Appellate  Body should reject Japan's request 
for the completion of the legal analysis.  
                                                
1161 OTI's Preliminary Report (Panel Exhibit JPN -2b). 
1162 KTC's Preliminary Resolution (Panel Exhibit JPN -1b). 
1163 OTI's Interim Report (Panel Exhibit JPN -3b). 
1164 Japan's appellant's submission, para.  334. (fns  omitted)  
1165 Japan's appellant's submission, para.  328. (fns  omitted)  
1166 Japan's appellant's submission, para.  329. 
1167 Korea's appellee's submission, para.  496 (ref erring to Appellate  Body Report, US – Anti-Dumping 
and Countervailing Duties (China) , para.  342).  
1168 Korea's appellee's submission, para.  497. Korea adds that the Panel did not make any finding on 
which document under domestic law is the appropriate one for purposes of this examination. (Ibid.)  
1169 Korea's appellee's submission, para.  498 (quoting Japan's appellant's submission, para.  329).  
1170 Korea's appellee's submission, para.  498. 
 WT/DS504/AB/R  
 
- 135 - 
 
  5.469.   Article  6.9 of the Anti -Dumping  Agreement reads:  
The authorities shall, before a final determination is made, inform all interested parties 
of the essential facts under considera tion which form the basis for the decision whether 
to apply definitive measures. Such disclosure should take place in sufficient time for the 
parties to defend their interests.  
5.470.   The Appellate  Body noted in China  – GOES  that Article  6.9 sets out "the require ment to 
disclose, before a final determination is made, the essential facts under consideration which form 
the basis for the decision whether or not to apply definitive measures".1171 Disclosing the essential 
facts under consideration "is paramount for ensuri ng the ability of the parties concerned to defend 
their interests".1172 The Appellate  Body also observed that, unlike Article  12.2.2 of the 
Anti-Dumping  Agreement, which governs the disclosure of matters of fact and law and reasons at 
the conclusion of anti -dumping and countervailing duty investigations, Article  6.9 "concern[s] the 
disclosure of 'facts' in the course of such investigations 'before a final determination is made' ."1173 
As to what type of facts are "essential" under Article  6.9, the Appellate  Body has stated that 
"essential facts" refer to those facts under consideration that "are significant in the process of 
reaching a decision as to whether or not to apply definitive measures".1174 
5.471.   With respect  to the temporal aspect of the obligation under Article  6.9, the investigating 
authorities must disclose the essential facts under consideration "before a final determination is 
made" and "in sufficient time for the parties to defend their interests". Moreover, the Appellate  Body 
held in China – HP-SSST (Japan) / China  – HP-SSST  (EU) that an investigating authority must 
disclose the essential facts "in a coherent way" that permits an interested party to understand the 
factual basis for each of the intermediate findings and conclusions reached by the autho rity, such 
that it is able properly to defend its interests.1175 
5.472.   In light of these considerations, compliance with Article  6.9 should be assessed on the basis 
of an investigating authority's conduct "before a final determination is made". Thus, in the present  
case, the application of the legal standard requires determining, first, which is  the "final 
determination" in the underlying investigation and, second, whether prior to  such "final 
determination" the Korean investigating authorities properly disclosed th e "essential facts" under 
consideration in accordance with Article  6.9. 
5.473.   In order to situate Japan's claim under Article  6.9, we begin by providing relevant 
background regarding the timeline of the underlying investigation in the present dispute. The 
invest igation at issue was initiated by the KTC based on an application filed by TPC and KCC on 
23 December  2013.1176 On 26  June 2014, the OTI issued a Preliminary Report on dumping and injury 
to the domestic industry of valves for pneumatic transmission from Japan .1177 On the same date, 
the KTC issued a Preliminary Resolution on dumping and injury to the domestic industry of valves 
for pneumatic transmission from Japan.1178 On 23  October  2014, the OTI issued an Interim Report 
on dumping and injury of valves for pneumatic  transmission from Japan.1179 On 20  January  2015, 
                                                
1171 Appellate  Body Report, China – GOES , para.  240. (emphasis original)  
1172 Appellate  Body Report, China – GOES , para.  240. 
1173 Appellate  Body Report, China – GOES , para.  240. See al so Appellate  Body Report, 
Russia  – Commercial Vehicles , para.  5.177.  
1174 Appellate  Body Report, China – GOES , para.  240. The Appellate  Body has similarly indicated that 
Article  6.9 "cover[s] 'facts under consideration', that is, those facts on the record tha t may be taken into 
account by an authority in reaching a decision as to whether or not to apply definitive anti -dumping … duties". 
(Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.129 (quoting 
Appellate  Body Report, China – GOES , para.  240))  
1175 Appellate  Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.130. See also 
Appellate  Body Report, China – GOES , para.  240. 
1176 Panel  Report, para.  2.2 (referring to KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)), p. 2; OTI's 
Final Report (Panel Exhibit KOR -2b (BCI)), p.  1). 
1177 See Panel  Report, fn  15 to para.  2.3 (referring to OTI's Preliminary Report (Panel Exhibit JPN -2b)). 
1178 Panel  Report, para.  2.3 (referring to KTC's Preliminary Resolution (Panel Exhibit JPN -1b)). In its 
Preliminary Resolution, the KTC determined that there was sufficient evidence to presume the existence of 
dumping and of material injury to the domestic industry caused by the dumped imports. The KTC did not 
recommend the imposition of provisiona l anti-dumping duties. In turn, the MOSF did not impose provisional 
anti-dumping duties. (Ibid.)  
1179 Panel  Report, para.  2.3 (referring to OTI's Interim Report (Panel Exhibit JPN -3b)). 
 WT/DS504/AB/R  
 
- 136 - 
 
  based on the OTI's Final Report of the same date, the KTC issued the Final Resolution determining 
that the Korean domestic industry producing the like product was materially injured by reason of 
the dumping of  pneumatic valves from Japan and recommending the imposition of anti -dumping 
duties.1180 The Panel observed that "[t]he full non -confidential texts of OTI's  Final Report and the 
KTC's Final Resolution were notified to domestic producers, importers, and consum ers on 
17 March  2015."1181 
5.474.   On 12  June 2015, the MOSF issued a Public Notice of Proposal Draft Rules on the Imposition 
of Anti -Dumping Duties on Valves for Pneumatic Transmissions Originating from Japan.1182 The Panel 
noted that "Japanese respondents subsequently  filed an Opinion before MOSF on the Proposal."1183 
On 5 August  2015, the KTC filed an opinion with the MOSF addressing the arguments advanced by 
the Japanese respondents.1184 Finally, "[r]elying on the KTC's Final Resolution, on 19  August  2015 
the MOSF adopted Decree No. 498, entitled 'Regulation Concerning the Imposition of Antidumping 
Duty on Valves for Pneumatic Transmissions Originating from Japan', which imposes anti -dumping 
duties for five years on the imports of pneumatic valves from Japan at the rates re commended in 
the KTC's Final Resolution."1185 
5.475.   We recall that the Appellate  Body may complete the legal analysis with a view to facilitating 
the prompt settlement and effective resolution of the dispute when the factual findings by the 
panel1186 and/or unconteste d facts on the panel record1187 provide a sufficient factual basis for doing 
so.1188 The Appellate  Body has therefore been unable to complete the legal analysis where there 
have been insufficient factual findings in the panel report and a lack of undisputed fact s on the panel 
record. Other reasons that have prevented the Appellate  Body from completing the legal analysis 
include the absence of a full exploration of the issues before the panel1189 and related considerations 
pertaining to the parties' due process right s.1190 
5.476.   In the present case, the participants disagree on which documents issued by the Korean 
investigating authorities constitute the "final determination" and which are the "disclosure" 
documents. On the one hand, Japan asserts that the "KTC's Final Resolut ion dated 20  January  2015 
constituted the 'final determination' for purposes of Article  6.9, as it encompassed the conclusion of 
the investigation of dumping and injury ."1191 Regarding the "disclosure" of essential facts, Japan 
argues that this was made in th e following three documents issued prior to the KTC's Final 
Resolution: (i) OTI's Preliminary Report dated 26  June 2014; (ii) KTC's Preliminary Resolution 
                                                
1180 Panel  Report, para.  2.4 (referring to KTC's Final Resolution (Panel Exh ibit KOR -1b), p.  1). 
1181 Panel  Report, para.  7.466 (referring to Notification of Final Determination on Dumping and Injury to 
Domestic Industry of Valves for Pneumatic Transmissions from Japan (Panel Exhibit JPN -29b)).  
1182 Panel  Report, para.  7.467 (referring to MOSF, Public Notice 2015 -105).  
1183 Panel  Report, para.  7.467 (referring to the Respondents' Opinion on the Pre -Announcement of 
Legislation of the Rule (Draft) on Imposition of Anti -Dumping Duties on Valves for Pneumatic Transmissions 
from Japan (Panel Exh ibit KOR -37b)). The Panel also observed that the Japanese respondents requested the 
MOSF not to impose anti -dumping duties, and that they advanced substantive objections to the KTC's findings 
with respect to various issues, such as: (a) the substitutabilit y of the products at issue; (b)  the scope of the 
domestic industry; (c) the consideration of the increase in dumped imports; (d) the effect of the dumped 
products on the price of the like product; (e) the consideration of other indicators pertaining to the  domestic 
industry; and (f) the assessment of other factors affecting the domestic industry. (Ibid.)  
1184 Panel  Report, para.  7.467 (referring to Opinion after Reviewing the Respondents' Opinion on the 
Public Notice of the (Proposal Pratt) Rules on Imposition  of Anti -Dumping Duties  (Panel Exhibit KOR -38b)).  
1185 Panel  Report, para.  7.467 (referring to MOSF's Decree No. 498 (Panel Exhibit JPN -6b); MOSF's 
Public Announcement (Panel Exhibit KOR -3b) (BCI)).  
1186 See e.g. Appellate  Body Reports, US – Gasoline , p. 19, DSR  1996:I, pp.  18-19; 
Canada  – Periodicals , p. 24, DSR 1997:I, p.  469; Australia – Salmon , paras.  117-119. 
1187 See e.g. Appellate  Body Reports, US – Lamb , paras.  150 and 172; US – Shrimp , paras.  123-124, 
132, and 140; US – Section 211 Appropriations Act , paras.  343-345; EC and certain member States – Large 
Civil Aircraft , paras.  1174-1177; US – Large Civil Aircraft (2nd complaint) , para.  1262.  
1188 See also Appellate  Body Reports, Colombia – Textiles , para.  5.30; US – Anti-Dumping Methodol ogies 
(China) , para.  5.146; Russia – Pigs (EU) , para.  5.141; EC and certain member States – Large Civil Aircraft , 
para. 1178; EC and certain member States – Large Civil Aircraft (Article  21.5 – US), para.  5.745.  
1189 See e.g. Appellate  Body Reports, EC – Asbestos, paras.  81-82; EC and certain member 
States  – Large Civil Aircraft (Article  21.5 – US), para.  5.749; EC ‒ Seal Products , para.  5.69; 
Russia  – Commercial Vehicles , para.  5.141.  
1190 See e.g. Appellate  Body Reports, EC – Export Subsidies on Sugar , para.  339; EC ‒ Seal Products , 
para. 5.69. 
1191 Japan's appellant's submission, para.  335. 
 WT/DS504/AB/R  
 
- 137 - 
 
  dated  26 June 2014; and (iii) OTI's Interim Report dated 23  October  2014.1192 On the other hand, 
Korea m aintains that "the 'final determination' within the meaning of Article  6.9 in the present case 
was the Final Decision of MOSF"1193 to impose definitive duties issued on 19  August  2015.1194 
Moreover, Korea submits that the documents in which the "disclosure" of essential facts was made 
are (i)  KTC's Final Resolution and (ii) OTI's Final Report, both of which were issued prior to the 
MOSF's Final Decision to impose definitive duties.1195 Consequ ently, the participants have a 
disagreement as to when  in the investigation the Korean investigating authorities reached the "final 
determination" within the meaning of Article  6.9. As a result, the participants also disagree on which 
documents issued duri ng the underlying investigation should be examined for purposes of assessing 
the "disclosure" of essential facts.  
5.477.   We recall that the Panel found that Japan's panel request did not meet the requirements of 
Article  6.2 of the DSU with respect to Japan's cla im under Article  6.9 of the Anti -Dumping Agreement  
and, consequently, that the claim was not within the Panel's terms of reference. As a result, the 
Panel "neither consider[ed] … further nor resolve[d]" this claim.1196 Thus, the Panel did not make 
any finding s indicating which documents constitute the "final determination" or which are the 
relevant "disclosure" documents for purposes of assessing compliance with Article  6.9, even though 
these issues  were contended by the parties in the course of the Panel proc eedings.1197 In the 
"Relevant facts" section of its Report pertaining to this claim, the Panel limited itself to describing 
the institutional structure and procedures for conducting anti -dumping investigations in Korea1198, 
providing a timeline of events in the underlying investigation1199, and summarizing relevant facts 
regarding the four categories of facts that, in Japan's view, were not properly disclosed: (i) price 
effects; (ii) volume; (iii) the state of the domestic industry; and (iv) causation.1200 In providing  these 
summaries, the Panel referred to multiple documents from the underlying investigation without 
determining which  of them, or whether all of them, constituted the "disclosure" documents for 
purposes of Japan's claim under Article  6.9.1201  
5.478.   The question w hether the disclosure of "essential facts" was made through the documents 
alleged by Japan or those asserted by Korea encompasses a series of factual  issues, with respect to 
which the Panel made no findings, and certain legal issues that were left unexplor ed by the Panel. 
For instance, the Panel made no findings on whether, under Korean law, the underlying anti -dumping 
investigation was concluded on substance when the MOSF decided to impose definitive measures or, 
alternatively, whether the anti -dumping inv estigation at issue was concluded on substance when the 
KTC issued its Final Resolution. Findings regarding these issues are necessary in order to assess 
which of the documents referred to by the participants constitute the "final determination" within 
                                                
1192 Japan's appellant's submission, para.  334 (referring to KTC's Preliminary Resolution (Panel Exhibit 
JPN-1b); OTI's Preliminary Report (Panel Exhibit JPN -2b); OTI's Interim Report (Panel  Exhibit JPN -3b)). 
1193 Korea's appellee's submission, para.  508 (referring to MOSF's Public Announcement  (Panel Exhibit 
KOR-3b (BCI))).  
1194 In response to questioning at the oral hearing, Korea asserted that the Final Decision of the MOSF is 
embodied in the MOSF's Public Announcement of the decision to impose anti -dumping duties on the pneumatic 
transmissions valves from Japan, which is part of the Panel record as Panel Exhibit KOR -3b. Korea further 
stated at the oral hearing that Decree No . 498, which is part of the Panel record as Panel Exhibit JPN -6b and is 
entitled "Regulation Concerning the Imposition of Antidumping Duty on Valves for Pneumatic Transmissions 
Originating from Japan", implements the MOSF's Final Decision by imposing anti -dumping duties for five years 
on the imports of pneumatic valves from Japan. We note that, as found by the Panel, MOSF's Public 
Announcement and MOSF's Decree No. 498 were both issued on 19  August  2015. (Panel  Report, para.  2.5 and 
fn 19 thereto)  
1195 Korea's  appellee's submission, para.  502. Korea refers to the KTC's Final Resolution and the OTI's 
Final Report as "the last and complete piece of the disclosure documents for the purpose of Article  6.9". (Ibid.) 
Korea also asserts that, "[i]n the course of the i nvestigation, and in sufficient time for interested parties to 
defend their interests, [the] KTC released several documents of relevance to Japan's claim." (Ibid. (referring to 
Korea's first written submission to the Panel, paras.  358-404; second written s ubmission to the Panel, 
paras.  163-177))  
1196 Panel  Report, para.  7.517.  
1197 See Panel  Report, paras.  7.453 -7.454 and 7.456.  
1198 Panel  Report, paras.  7.463 -7.465.  
1199 Panel  Report, paras.  7.466 -7.467.  
1200 Panel  Report, paras.  7.469 -7.510.  
1201 In addressing the four cat egories of facts that, in Japan's view, were not properly disclosed, the 
documents cited by the Panel include: (i) KTC's Final Resolution (Panel Exhibit KOR -1b (BCI)); (ii) OTI's Final 
Report (Panel Exhibit KOR -2b (BCI)); (iii) OTI's Interim Report (Panel Exhibit JPN -3b); and (iv) OTI's 
Preliminary Report (Panel Exhibit JPN -2b). (Panel  Report, paras.  7.469 -7.510)  
 WT/DS504/AB/R  
 
- 138 - 
 
  the meaning of Article  6.9, prior to which the required disclosure of essential facts should have 
occurred. Moreover, the Panel made no findings as to whether, in the investigation at issue, the 
KTC's Final Resolution and the OTI's Final Report constitute the  last and complete piece of the 
disclosure documents that formed the basis for the Final Decision by the MOSF, or, alternatively, 
whether the disclosure of essential facts was made earlier  in the proceedings through the OTI's 
Preliminary Report dated 26  June 2014, the KTC's Preliminary Resolution dated 26  June 2014, and 
the OTI's Interim Report dated 23  October  2014. Findings regarding these issues are necessary in 
order to determine which of the documents referred to by the participants may be regarded as the 
disclosure documents, whose content must be scrutinized for assessing the Korean investigating 
authorities' compliance with Article  6.9. 
5.479.   The participants present conflicting views with respect to the issues described above. 
Therefore, there is consider able uncertainty regarding which documents should be examined for 
purposes of determining  whether the Korean investigating authorities properly disclosed the 
"essential facts" under consideration, as required by Article  6.9 of the Anti -Dumping Agreement . 
Agreeing with Japan that the "final determination" within the meaning of Article  6.9 is the KTC's 
Final Resolution would mean that the assessment under Article  6.9 should be conducted on the basis 
of the documents issued before  the KTC's Final Resolution, w hich include: (i) the OTI's Preliminary 
Report; (ii) the KTC's Preliminary Resolution; and (iii) the OTI's Interim Report. By contrast, agreeing 
with Korea that the "final determination" under Article  6.9 is the MOSF's decision from 
19 August  2015 that res ulted in the adoption of Decree No. 498 would mean that compliance with 
Article  6.9 should be primarily determined on the basis of: (i) the KTC's Final Resolution; and 
(ii) the OTI's Final Report.  
5.480.   In light of the above considerations, it is clear that the re are no Panel findings, undisputed 
facts on the record, or a sufficient exploration by the Panel of certain key issues1202, for the purpose 
of determining when  the "final determination" within the meaning of Article  6.9 was reached in the 
investigation at issue and which are the "disclosure"  documents for purposes of Article  6.9. 
Therefore, we are unable to ascertain which document constitutes the "final determination" in the 
investigation at issue, such that the rele vant documents issued by the Korean investigating 
authorities prior to  the issuance of that final determination could be examined to assess whether 
they properly disclosed the essential facts "before a final determination is made" and "in sufficient 
time f or the parties to defend their interests". Resolution of these issues is needed to determine 
whether Korea acted inconsistently with Article  6.9 by failing to disclose the "essential facts" with 
respect to price effects, the volume of the dumped imports, the state of the domestic industry, and 
causation.1203 
5.481.   We conclude that, because key issues were left unexplored by the Panel and there is a lack 
of sufficient factual findings by the Panel and uncontested facts on the record, there is considerable 
uncertainty  regarding when  the "final determination" was reached in the investigation at issue and 
which are the "disclosure"  documents for purposes of Article  6.9. There is therefore no basis for us 
to determine whether Korea acted inconsistently with Article  6.9 by  failing to disclose the "essential 
facts" under consideration. Consequently, we find ourselves unable to complete the legal analysis 
with regard to Japan's claim that Korea acted inconsistently with Article  6.9 of the 
Anti-Dumping  Agreement . 
6  FINDINGS AND CONCLUSIONS  
6.1.  For the reasons set out in this Report, the Appellate  Body makes the following findings and 
conclusions:  
6.1  Overall considerations regarding the legal standard under Article  6.2 of the DSU  
6.2.  The requirements under Article  6.2 of the DSU are central to the establishment of the 
jurisdiction of a panel . A panel request governs a panel's terms of reference and delimits the scope 
of the panel's jurisdiction. In addition, by establishing and defining the jurisdiction of the panel , the 
panel request also fulfils a due process objective by providing the respondent and third parties with 
notice regarding the nature of the complainant's case and enabling them to respond accordingly. 
Whether a panel request complies with the requiremen ts of Article  6.2 of the DSU must be 
                                                
1202 See para.  5.475  above.  
1203 Japan's appellant's submission, para.  334. WT/DS504/AB/R  
 
- 139 - 
 
  determined on the face of the panel request, on a case -by-case basis. Defects in the request for the 
establishment of a panel cannot be cured in the subsequent submissions of the parties during the 
panel proceedings. However, in considering the sufficiency of a panel request, submissions and 
statements made during the course of the panel proceedings, in particular the first written 
submission of the complaining party, may be consulted in order to confirm t he meaning of the words 
used in the panel request.  
6.3.  In order to "provide a brief summary of the legal basis of the complaint sufficient to present 
the problem clearly" pursuant to Article  6.2 of the DSU, a panel request must plainly connect the 
measure(s) w ith the provision(s) of the covered agreements claimed to have been infringed. The 
identification of the treaty provision claimed to have been violated by the respondent is "always 
necessary" and a "minimum prerequisite", but may not be sufficient to meet the above requirement 
of Article  6.2 depending on the particular circumstances of a case. Such circumstances include the 
nature of the measure at issue and the manner in which it is described in the panel request, as well 
as the nature of the provisions of  the covered agreements alleged to have been breached.  
6.2  Domestic industry  
6.2.1   Whether the Panel erred in finding that Japan's claim 7 concerning the definition of 
the domestic industry was not within its terms of reference  
6.4.  Japan's  panel request  refers to both Articles  3.1 and 4.1 of the Anti -Dumping Agreement  and 
thus identifies the provisions of the covered agreements alleged to have been breached. Japan's 
claim also makes clear that it relates specifically to the portion of the measure at issue concerning 
the definition of  the domestic industry and its alleged inconsistency with Korea's obligation under 
Articles  3.1 and 4.1. In turn, Articles  3.1 and 4.1 together establish a distinct, well -delineated 
obligation regarding the definition of the domestic industry.  Thus, Japan's claim 7 "provide[s] a brief 
summary of the legal basis of the complaint sufficient to present the problem clearly" within the 
meaning of Article  6.2 of the DSU. For the foregoing reasons, we find that the Panel erred in finding 
that claim 7 in Japan's panel request  was not within its terms of reference.  
a. Consequently, we reverse  the Panel's finding , in paragraphs 7.67 and 8.1.a of the 
Panel  Report , and find that Japan's claim 7 is within the Panel's terms of reference.  
6.2.2   Whether the Appellate  Body  can complete the legal analysis  
6.5.  In defining the domestic industry as a "major proportion" of the total domestic production, an 
investigating authority is required t o assess both quantitative and qualitative aspects, and ensure 
that it does not act in a manner that gives rise to a material risk of distortion. As discussed in 
section  5.2.2 above, we are unable to complete the legal analysis with regard to the above aspects 
of the "major proportion" requirement. First, in the absence of relevant factual findings by the Panel 
or undisputed facts on the Panel record, we are unable to assess whether the KTC considered the 
available evidence objectively in calculating the pr oportion of the total domestic production 
accounted for by the applicants. In addition, we do not have sufficient factual findings by the Panel 
or undisputed facts on the Panel record to assess whether the two applicants included in the 
definition of the d omestic industry were sufficiently representative of the total domestic production, 
or whether the Korean investigating authorities' process of defining the domestic industry introduced 
a material risk of distortion.  
a. Consequently, we find ourselves unable to complete the legal analysis regarding Japan's 
claim that  the Korean investigating authorities' definition of the domestic industry  is 
inconsistent with Articles  3.1 and 4.1 of the Anti -Dumping  Agreement.  
6.3  Determination of injury  
6.3.1   Whether the Panel erred i n finding that Japan's claim 1 concerning the volume of 
dumped imports was not within its terms of reference  
6.6.  Japan's  claim 1 identifies both Articles  3.1 and 3.2 of the Anti -Dumping  Agreement  as the 
provisions alleged to have been breached, and indicates t hat it relates to "Korea's analysis of a 
significant increase of the imports under investigation". This claim thus identifies the provisions of WT/DS504/AB/R  
 
- 140 - 
 
  the covered agreements alleged to have been breached . It further makes clear that it concerns the 
specific portion of the measure at issue relating to the Korean investigating authorities' consideration 
of the volume of the dumped imports and its alleged inconsistency with Articles  3.1 and 3.2 of the 
Anti-Dumping  Agreement. With regard to volume, Article 3.1 and the first sentence of Article  3.2 
together establish a distinct and well -delineated obligation that the investigating authorities make 
an objective examination of whether there has been a significant increase in dumped imports on the 
basis o f positive evidence. Thus, Japan's claim 1 "provide[s] a brief summary of the legal basis of 
the complaint sufficient to present the problem clearly" within the meaning of Article  6.2 of the DSU. 
For the foregoing reasons, we find that the Panel erred in f inding that Japan's claim 1, concerning 
the volume of the dumped imports, was not within its terms of reference.  
a. Consequently, we reverse  the Panel's finding , in paragraphs 7.94 and 8.1.b of the 
Panel  Report , and find that Japan's claim 1 is within the Pan el's terms of reference.  
6.3.2   Whether the Panel erred in finding that Japan's claim 2 concerning the price effects 
was not within its terms of reference  
6.7.  Japan's claim  2 identifies both Articles  3.1 and 3.2 of the Anti -Dumping Agreement  as the 
provisions alleged  to have been breached. In addition,  Japan's panel request indicates that this claim 
concerns the specific portion of the measure at issue that relates to the Korean investigating 
authorities' consideration of the price effects of the dumped imports, more precisely significant price 
suppression and price depression, and its alleged inconsistency with Articles  3.1 and 3.2. With regard 
to price effects, t he second sentence of Article  3.2, in conjunction with Article  3.1, sets out an 
obligation that is distinct and well  defined, with, at its core, the requirement to consider, on the 
basis of an objective examination of positive evidence, whether the effect of the dumped imports on 
domestic prices consists of the economic phenomena contained therein, incl uding significant price 
suppression and price depression . Therefore, Japan's claim  2 "provide[s] a brief summary of the 
legal basis of the complaint sufficient to present the problem clearly" within the meaning of 
Article  6.2 of the DSU. For the foregoing reasons, we find that the Panel erred in finding that Japan's 
claim 2, concerning the price effects of the dumped imports, was not within its terms of reference.  
a. Consequently, we reverse  the Panel's finding , in paragraphs 7.131 and 8.1.c of the 
Panel  Repor t, and find that Japan's claim 2 is within the Panel's terms of reference.  
6.3.3   Whether the Panel erred in finding that part of Japan's claim 3 concerning the 
impact of the dumped imports on the domestic industry was not within its terms of 
reference  
6.8.  Japan's cl aim 3 identifies the portion of the measure at issue that relates to the Korean 
investigating authorities' "analysis  of the impact of the imports under investigation on the domestic 
industry" and thus identifies with sufficient precision the specific aspec t of the measure at issue. 
Claim 3 also identifies Articles  3.1 and 3.4 of the Anti -Dumping Agreement  as the provisions alleged 
to have been breached.  Article  3.4, together with Article  3.1, establishes a distinct obligation that 
essentially requires the i nvestigating authorities to examine objectively the impact of the dumped 
imports on the domestic industry on the basis of positive evidence concerning all relevant economic 
factors and indices having a bearing on the state of the domestic industry. Japan's  claim 3 thus 
"provide[s] a brief summary of the legal basis of the complaint sufficient to present the problem 
clearly" within the meaning of Article  6.2 of the DSU. The three allegations that the Panel found to 
be outside its terms of reference, like Jap an's other arguments under claim 3, serve to explain the 
manner in which the Korean investigating authorities would have breached the distinct obligation 
established by Articles  3.1 and 3.4, such that Japan was not required to include this level of detail 
in its panel request. For the foregoing reasons, we find that the Panel erred in finding that these 
three allegations were not within its terms of reference.  
a. We therefore reverse  the Panel's finding, in para graph 7.175 of the Panel Report, that "all 
other allegations of inconsistency with Article  3.4 argued by Japan are not properly within 
the Panel's terms of reference", and in paragraph 8.1.d of the Panel Report , that "Japan's 
claim under Articles  3.1 and 3 .4 of the Anti -Dumping  Agreement concerning the impact of 
the dumped import on the state of the domestic industry" was not within the Panel's terms 
of reference , and find the three allegations described above to be within the Panel's terms 
of reference . WT/DS504/AB/R  
 
- 141 - 
 
  6.3.4   Whether the Panel erred in finding that Japan's claim 4 was within its terms of 
reference  
6.9.  Japan's claim 4 identifies Articles  3.1 and 3.5 of the Anti -Dumping  Agreement  as the provisions 
alleged to have been breached, and relates specifically to the Korean investigating authorities' 
alleged failure to demonstrate that the imports under investigation were causing injury to the 
domestic industry. While Article  3.5, together with Article  3.1, establishes obligations that are 
multilayered, Japan has indicated whic h aspect of the obligations set forth in Articles  3.1 and 3.5 is 
alleged to have been breached. Japan's claim 4, on its face, is about the alleged failure to 
demonstrate the causal relationship on the basis of an "objective examination" of "all relevant … 
evidence before the authorities" as required under Article  3.5, in particular its second sentence, as 
well as under Article  3.1. Thus, Japan's claim 4 "provide[s] a brief summary of the legal basis of the 
complaint sufficient to present the problem clearly" within the meaning of Article  6.2 of the DSU. 
For these reasons, we find that the Panel did not err in finding that Japan' s claim 4 was within its 
terms of reference.  
a. Consequently, we uphold  the Panel's finding in paragraphs 7.235 and 8.2.c of the 
Panel  Report . 
6.3.5   Whether the Panel erred in finding that part of Japan's claim 5 was within its terms 
of reference  
6.10.   Japan's claim 5 identifies Articles  3.1 and 3.5 of the Anti -Dumping Agreement  as the 
provisions alleged to have been breached, and relates to a specific aspect of the causation 
determination, namely the Korean investigating authorities' examination of the non-attribution 
factors. While Articles  3.1 and 3.5 establish obligations that are multilayered, Japan has identified 
which aspect of the provisions its claim concerns, namely the requirement not to attribute to the 
dumped imports the injuries caused by an y known factors  other than the dumped imports . Thus, 
Japan's claim 5 "provide[s] a brief summary of the legal basis of its complaint sufficient to present 
the problem clearly" within the meaning of Article  6.2 of the DSU. For the foregoing reasons, we find 
that the Panel did not err in finding that part of Japan's claim 5, with regard  to Korea's alleged failure 
to consider adequately all known factors other than the dumped imports causing injury, was within 
its terms of reference.  
a. Consequently, we uphold  the Panel's finding , in paragraphs  7.241 and 8.2.d of the Panel 
Report , that Japan's claim under Articles  3.1 and 3.5 of the Anti -Dumping  Agreement , 
insofar as it relates to  the alleged failure of the Korean investigating authorities to examine 
certain know n factors adequately and their examination of those factors in isolation , is 
properly within the Panel's terms of reference.  
6.3.6   Whether the Panel erred in finding that Japan's claim 6 was within its terms of 
reference  
6.11.   Japan's claim 6 identifies Articles  3.1 and 3.5 of the Anti -Dumping Agreement  as the 
provisions alleged to have been breached , and concerns a specific aspect of the Korean measure, 
namely the determination of causation by the Korean investigating authorities within the meaning 
of Article  3.5. While Articles  3.1 and 3.5 establish obligations that are multilayered, Japan  has 
identi fied in the narrative of its claim the particular aspect of the provisions its claim relates to. By 
indicating that " Korea's demonstration of causation lacks any foundation in its analyses of the volume 
of the imports under investigation, the effects of th e imports under investigation on prices, and/or 
the impact of the imports under investigation on the domestic industry at issue", Japan's claim 6 
indicates that it takes issue with the demonstration of the causal relationship between the dumped 
imports and  the domestic industry as provided in the first sentence of Article  3.5 of the 
Anti-Dumping  Agreement. Thus, the Panel rightly took the view that the narrative in Japan's panel 
request is sufficiently precise to present the problem clearly. In addition, wh ether a claim is related 
to, contingent on, or independent from another claim does not detract from the requirement under 
Article  6.2 of the DSU to consider the panel request on its face to determine whether it provides the 
legal basis of the complaint suf ficient to present the problem clearly. For these reasons, we find that 
the Panel did not err in finding that Japan's claim 6 was within its terms of reference .  WT/DS504/AB/R  
 
- 142 - 
 
  a. Consequently, we uphold  the Panel's finding in paragraphs  7.226 and 8.2.b of the 
Panel  Report . 
6.3.7   Magnitude of the margin of dumping  
6.12.   Articles  3.1 and 3.4 require an investigating authority to evaluate the magnitude of the margin 
of dumping, and to assess its relevance and the weight to be attributed to it in the injury assessment. 
However, we do not c onsider that these provisions require any one of the listed factors, such as the 
magnitude of the margin of dumping, to be evaluated in a particular manner or given a particular 
relevance or weight, in examining the impact of the dumped imports on the dome stic industry. 
Therefore, we find that the Panel did not err in its interpretation of Articles  3.1 and 3.4 of the 
Anti-Dumping Agreement  with respect to the evaluation of the magnitude of the margin of dumping. 
In addition, we find that Japan has failed to  substantiate  that: (i) the Korean investigating authorities 
did not evaluate the magnitude of the margin of dumping as required under Articles  3.1 and 3.4; 
and (ii) the Korean investigating authorities were required to conduct a counterfactual analysis in  
light of the facts of the case.  
a. Consequently, we uphold  the Panel's finding, in paragraphs 7.189 -7.192 and 8.3 .a of the 
Panel Report, that Japan failed to establish that the Korean investigating authorities acted 
inconsistently with Articles  3.1 and 3.4 o f the Anti -Dumping Agreement  with respect to 
their evaluation of the magnitude of the margin of dumping.  
6.3.8   Causation  
6.3.8.1   Whether the Panel erred in its interpretation or application of Article  3.5 in 
addressing Japan's claim 6  
6.13.   With respect to a claim under Article  3.5, a panel is tasked with reviewing an investigating 
authority's ultimate demonstration that "dumped imports are, through the effects of dumping, as 
set forth in paragraphs 2 and 4 , causing injury " to the domestic in dustry. In so doing, a panel is 
called upon to review whether the investigating authority properly linked the outcomes of its 
analyses conducted pursuant to Articles  3.2 and 3.4 , taking into account the evidence and factors 
required under Article  3.5, in c oming to a definitive determination regarding the causal relationship 
between dumped imports and injury to the domestic industry. A panel's review does not, however, 
call for revisiting the question whether each of the interlinked components of this determ ination 
itself meets the applicable requirements set out in Article  3.2 or Article 3.4. Examining such 
consistency in the context of a claim under Article  3.5 would effectively require a panel to incorporate 
and apply obligations and disciplines set out in  other paragraphs of Article  3, which are not contained 
in the text of Article  3.5. We agree with Korea that the phrase "through the effects of dumping, as 
set forth in paragraphs 2 and 4" in Article  3.5 "is not a call [for a panel] to re -do the examinatio n[s]" 
under Articles  3.2 and 3.4 of the Anti -Dumping Agreement .  
6.14.   In the present dispute, under claim 6, Japan alleged that the KTC's causation determination 
was undermined by its flawed analyses of the volume of the dumped imports, the price effects, and 
the impact of the dumped imports on the state of the domestic industry, "irrespective and 
independent" of whether the Panel found the KTC's analyses of volume, price effects, and impact to 
be inconsistent with Articles  3.2 and 3.4 of the Anti -Dumping Agreem ent.  
6.15.   In addressing claim 6, the Panel first considered Japan's arguments with respect to the volume 
of dumped imports. The Panel noted that "Japan's allegation that certain flaws in the KTC's analysis 
of the volume of dumped imports 'independently' underm ine[d] its causation determination" was 
based on the fact that: (i) the volume of dumped imports decreased during two years of the 
three -year period of trend analysis; and (ii) the volume of dumped imports increased only modestly 
in absolute terms and decr eased in terms of market share in 2013 compared with 2010. The Panel 
rejected these arguments and found that Japan failed to demonstrate that the Korean investigating 
authorities acted inconsistently with Articles  3.1 and 3.5 of the Anti -Dumping Agreement . In so 
doing, the Panel reviewed the Korean investigating authorities' analysis pursuant to the 
requirements set out in Article  3.2, first sentence, as opposed to those under Article  3.5. Thus, in 
reviewing the causation claim at issue, the Panel effective ly incorporated the requirements in 
Article  3.2, first sentence, rather than properly applying the requirements set out in Article  3.5 in its WT/DS504/AB/R  
 
- 143 - 
 
  assessment of the causation  claim at issue . We therefore consider the Panel to have erred in its 
application of Article  3.5.  
6.16.   With respect to price effects in the context of claim 6, before the Panel, Japan advanced three 
grounds in support of its claim that the KTC's analysis of the price effects  of the dumped imports 
"independently" undermined its causation determination, namely that: (i) there was divergence 
between the trends in dumped import and domestic like product prices; (ii) dumped imports 
consistently and significantly oversold the domes tic like product; and (iii) there was no competitive 
relationship between the dumped imports and the domestic like product, such that their prices were 
not comparable. The Panel found that the KTC acted inconsistently with Articles  3.1 and 3.5 of the 
Anti-Dumping Agreement  by "failing to ensure price comparability, in terms of the dates and sales 
quantities involved, when it compared the individual transaction prices of certain models of dumped 
imports with the average prices of corresponding models of the domestic like product". Concerning 
overselling, the Panel found that the Korean investigating authorities failed to explain adequately 
their consideration of the price-suppressing and -depressing effects of dumped imports in their 
determination of causatio n, in light of the undisputed fact that the prices of the dumped imports 
were higher than those of the domestic like product throughout the period of trend analysis, and 
therefore acted inconsistently with Articles  3.1 and 3.5. As for diverging price trend s, the Panel found 
that the different magnitude s of the price decreases from 2012 to 2013 and the opposing price 
movements from 2011 to 2012 d id not, in and of themselves, demonstrate that the KTC's 
determination of a causal relationship was inconsistent w ith Articles  3.1 and 3.5.  
6.17.   To the extent that an investigating authority relies on price comparisons in its consideration 
of the price effects of dumped imports, price comparability needs to be ensured. Thus, where an 
investigating authority fails to ensur e price comparability in price comparisons between dumped 
imports and the domestic like product s, this undermines its findings of price effects under Article  3.2, 
to the extent that it relies on such price comparisons. We agree with the Panel that the KTC was 
required to ensure price comparability in its price comparisons inasmuch as it relied on the price 
differentials in these comparisons to find that dumped imports had price -suppressing 
and -depressing effects on domestic prices. Likewise, we agree with the Panel that , given the 
consistent overselling by the dumped imports and the fact that the average prices of the models of 
dumped imports involved in the individual instances of "underselling" were higher than the average 
prices of the corresponding dome stic models, an explanation and analysis of how and to what extent 
the prices of the domestic like product are affected was necessary. That said, our review of the 
Panel's findings indicates that , for each of these arguments , the analyses carried out by th e Panel 
were pertinent to a claim under Article  3.2 and were in line with the requirements of that provision, 
rather than to a claim under Article  3.5. In so doing, the Panel effectively incorporated the 
requirements of Article  3.2, rather than properly applying the requirements set out in Article  3.5, 
even though it was reviewing a claim under the latter provision . With respect to a claim under 
Article  3.5, a panel's review does not call for revisiting the question whether each of the interlinked 
components of the causation determination itself meets the applicable requirements set out under 
their respective provisions, such as the determination of price  effects under Article  3.2. We therefore 
consider the Panel to have erred in its application of Article  3.5.  
6.18.    Finally, with respect to the examination of the impact of dumped imports in the context of 
claim 6, before the Panel, Japan relied on its argumen t that, because the KTC did not establish any 
logical connection between the effects of the dumped imports under Article  3.2 and the condition of 
the domestic industry for the purpose of its impact analysis under Article  3.4, its causation 
determination wa s undermined. The Panel found that "'the logical progression of inquiry' does not 
mean that the examination of impact under Article  3.4 must be linked to the consideration under 
Article  3.2." We agree with the Panel that , in order to examine the impact of dumped imports on the 
domestic industry properly for purposes of Article  3.4, an investigating authority is not required to 
link that examination with its consideration of the volume and the price effects of the dumped 
imports. Similarly, we agree with the  Panel's finding that "there is no need 'to undertake a fully 
reasoned causation and non -attribution analysis' as part of Article  3.4." However, the Panel's 
examination of the alleged flaws in the Korean investigating authorities' impact analysis primarily  
relates to the issue of whether the KTC's impact examination was in line with the requirements set 
out in Article  3.4, as opposed to Article  3.5. In so doing, the Panel effectively incorporated the 
requirements of Article  3.4 rather than properly applying  the requirements set out in Article  3.5, 
even though it was reviewing a claim under the latter provision . Article  3.5 does not foresee a panel 
revisiting the question whether an investigating authority's impact analysis is consistent with 
Article  3.4. We therefore consider the Panel to have erred in its application of Article  3.5. WT/DS504/AB/R  
 
- 144 - 
 
  a. Consequently, we reverse  the Panel's finding, in paragraph 8.4.a of the Panel  Report , that 
Japan has demonstrated that the Korean investigating authorities acted inconsistently w ith 
Articles  3.1 and 3.5 of the A nti-Dumping  Agreement  in their causation analysis as a result 
of flaws in their analysis of the effect of the dumped imports on prices in the domestic 
market.  
6.3.8.2   Whether the Panel erred in its interpretation or application of Article  3.5 in 
addressing Japan's claim 4  
6.19.   In addressing Japan's volume -related arguments in the context  of claim 6, the Panel reviewed 
the requirements under Article  3.2, first sentence, as opposed to those under Article  3.5. Thus, the 
Panel effectively incorporated the requirements in Article  3.2, first sentence, concerning the volume 
of dumped imports  in its assessment of Japan's claim under Article  3.5, rather than applying properly 
the requirements set  out in Article  3.5. Given that the Panel relied on the same considerations in 
rejecting Japan's arguments concerning the lack of correlation in volume tre nds in the context of the 
causation claim at issue (claim 4), we find the Panel's finding in this regard to be in error.  
6.20.   The Panel's analysis of the diverging trends in the context of Japan's claim 6 focused on 
whether there was a lack of competitive relat ionship between dumped imports and domestic like 
products, and whether the diverging price trends could, in and of themselves, undermine the causal 
relationship under Article  3.5. The Panel reviewed the Korean investigating authorities' examination 
of the relationship  between the prices of the dumped imports and those of the domestic like product s, 
in order to ascertain the effects of the former on the latter, which corresponds to an examination 
properly conducted pursuant to Article  3.2, second sentence. Therefore, the Panel's conclusion that 
the diverging price trends, do not, in and of themselve s, demonstrate that the KTC's determination 
of a causal relationship is inconsistent with Articles  3.1 and 3.5 was a mere consequence of its 
analysis as to whether the KTC's price -effects analyses were objective and reasoned, and compatible 
with the requir ements set out in Article  3.2, second sentence. For these reasons, the Panel's analysis 
of the issue of diverging price trends was based on the applicable requirements under Article  3.2, 
rather than those concerning causation under Article  3.5, even though  it was addressing a claim 
under the latter provision . Given that the Panel, in the context of the causation claim at issue 
(claim  4), relied on the same considerations in rejecting Japan's arguments concerning the lack of 
correlation in price trends due t o the diverging price trends, we find the Panel's finding in this regard 
to be in error.  
6.21.   With respect to profit trends, neither the Panel nor the KTC ignored the alleged lack of 
correlation between the domestic -industry profit, dumped import prices, and th e volume and market 
share of the dumped imports. For these reasons, we reject Japan's argument that the KTC's 
discussion on this issue was deficient, and that the Panel should have recognized this alleged 
deficiency. We do not see any error in the Panel's finding that Japan has failed to establish that the 
insufficient correlation between dumped imports and trends in domestic -industry profits 
demonstrate s that a reasonable and unbiased investigating authority could not have properly found 
the required causa l relationship between the dumped imports and injury to the domestic industry in 
light of the facts and arguments that were before the KTC.  
a. Consequently, we uphold  the Panel's finding, in paragraph 8.3.b of the Panel  Report , that 
Japan has not demonstrated  that the Korean investigating authorities acted inconsistently 
with Articles  3.1 and 3.5 of the Anti -Dumping Agreement  with respect to their conclusion 
that the dumped imports, through the effects of dumping, were causing injury to the 
domestic industry, insofar as Japan's argument regarding insufficient correlation between 
dumped imports and trends in domestic -industry profits is concerned.  
6.3.9   Whether the Appellate  Body  can complete the legal analysis under Articles  3.1, 3.2, 
and 3.4 of the Anti -Dumping Agreement  
6.3.9.1   Whether the Korean investigating authorities acted inconsistently with 
Articles  3.1 and 3.2 of the Anti -Dumping  Agreement in their consideration of the volume 
of dumped imports  
6.22.   Japan makes certain arguments in support of its present claim under Articles  3.1 and 3.2 that 
are identical to those addressed by the Panel in the context of claim 6. Japan argues that the KTC WT/DS504/AB/R  
 
- 145 - 
 
  acted inconsistently with Articles  3.1 and 3.2 by "improperly" finding a "significant increase" in 
subject imports, even though the volume of such imports "actually fell in two out of three of the 
comparison periods and ended the overall period up only slightly on an absolute basis and actually 
down on a relative basis". Thus, like its argument in the context of claim 6, Japan focuses on the 
alleged failure by the KTC to take into account the decrease of import volumes in absolute terms 
during the first two years of the POI, and the decrease of import volumes in relative terms, in finding 
that there was a "significant increase" in the volume of imports. The Panel's analysis of Japan's 
identical arguments in the context of claim 6 properly reviewed the requirements set out in 
Article  3.2, first sentence.  
6.23.   However, Japan's  arguments in the context of its present claim under Articles  3.1 an d 3.2 
concerning the volume of dumped imports , regarding which it requests us to complete the legal 
analysis, encompass broader considerations than those contained in the findings by the Panel, 
namely that: (i) the KTC improperly assumed a competitive rela tionship between domestic like 
products and subject imports; and (ii) the KTC improperly found a "significant increase" in subject 
imports without examining whether the increased imports actually replaced domestic like products 
through market competition. The Panel did not sufficiently explore these issues with the participants. 
Moreover, the underlying factual bases pertaining to these issues are contested between the 
participants.  Confronted with these circumstances, completion of the legal analysis with respect to 
these issues is hindered by the absence of relevant factual findings, sufficient undisputed facts on 
the panel record, and a sufficient exploration by the Panel. Thus, engaging in the completion exercise 
would require us to review and consider evidence and arguments that were not sufficiently addressed 
by the Panel or sufficiently explored and developed before the Panel.  
a. Consequently, we find ourselves unable to complete the legal analysis as to whether the 
Korean measures are inconsist ent with Articles  3.1 and 3.2 of the Anti -Dumping 
Agreement  with respect to the Korean investigating authorities' consideration of the 
volume of dumped imports . 
6.3.9.2   Whether the Korean investigating authorities acted inconsistently with 
Articles  3.1 and 3.2 of the Anti -Dumping  Agreement in their consideration of price effects  
6.24.   Japan requests us to complete the legal analysis and find that the Korean investigating 
author ities failed to meet their obligations under Articles  3.1 and 3.2 of the Anti -Dumping Agreement 
because: (i) the KTC failed to ensure the price comparability; (ii) the KTC failed to consider the 
implications of overselling by the dumped imports; and (iii) the KTC largely ignored the diverging 
price trends. Japan also contends that the KTC erred in its findings because it failed to address the 
counterfactual question of how prices might have been different in the absence of dumping and the 
KTC never consider ed whether the alleged price suppression and price depression were significant. 
Finally, Japan contends that the "reasonable sales price" analysis conducted by the KTC was "flawed 
and insufficient".  
6.25.   With respect to price comparability and price oversellin g, Japan raised identical arguments in 
the context of claim 6. The Panel's analyses and findings, although made in the context of claim 6, 
were nonetheless in line with and properly conducted under the requirements set out in Article  3.2, 
second sentence. The flaws that the Panel identified concerned the objectivity and evidentiary 
foundation of the KTC's price suppression and price depression findings under Articles  3.1 and 3.2. 
Therefore, as the Korean investigating authorities found price -suppressing and  -depressing effects 
of dumped imports based on (i) the transaction -to-average price comparisons without ensuring price 
comparability and (ii) failed to provide an explanation and analysis of how and to what extent the 
prices of the domestic like product w ere affected in light of the consistent overselling by dumped 
imports, we find them to have acted inconsistently with Articles  3.1 and 3.2 of the Anti -Dumping 
Agreement. With respect to diverging price trends, Japan raised an identical argument in the cont ext 
of claim 6. The Panel's findings, although made in the context of claim 6, properly reviewed the 
Korean investigating authorities' examination of the relationship  between the prices of the dumped 
imports and those of the domestic like product s, in order to ascertain the effects of the former on 
the latter. This corresponds to an examination properly conducted pursuant to Article  3.2, second 
sentence. The Panel properly reviewed the Korean investigating authorities' consideration of the 
divergin g price trends in light of the requirements set out in Article  3.2, second sentence , and found 
it reasonable and supported by facts. We therefore reject Japan's allegation that the KTC "largely 
ignored" the diverging price trends. Accordingly, we find that  the Korean investigating authorities WT/DS504/AB/R  
 
- 146 - 
 
  did not act inconsistently with Articles  3.1 and  3.2 of the Anti -Dumping Agreement with respect to 
their consideration of diverging price trends.  
6.26.   With respect to Japan's arguments concerning (i) the KTC's failure to ad dress the 
counterfactual  question of how prices might have been different in the absence of dumping , (ii) the 
KTC's failure to address whether the alleged price suppression and price depression were significant , 
and (iii) whether the "reasonable sales pric e" analysis conducted by the KTC was "flawed and 
insufficient", the Panel never explored these arguments with the parties . Moreover, the parties 
disagree  with respect to the factual bases underlying these arguments. Therefore, given the limited 
scope and n ature of the Panel's factual findings and the limited undisputed record evidence in this 
regard, our attempt to complete the legal analysis involving such competing arguments would 
require us to review and consider evidence and arguments that were not suff iciently addressed by 
the Panel or sufficiently explored and developed before the Panel.  
a. For the foregoing reasons, we find that we are able to complete the legal analysis in part. 
For the reasons explained above, we find that the Korean investigating aut horities acted 
inconsistently with Articles  3.1 and 3.2 of the Anti -Dumping Agreement: (i) to the extent 
that they found  price-suppressing and -depressing effects of dumped imports based on 
the relevant price comparisons without ensuring price comparability ; and (ii) in the 
absence of any explanation and analysis of how and to what extent the prices of the 
domestic like product were affected in light of the consistent overselling by the dumped 
imports when finding price suppression and price depression . We also find that the Korean 
investigating authorities did not act inconsistently with Articles  3.1 and  3.2 of the 
Anti-Dumping Agreement with respect to their consideration of diverging price trends.  
b. However, for the reasons explained above, we find ourselves unable to complete the legal 
analysis as to whether the Korean investigating authorities acted inconsistently with 
Articles  3.1 and 3.2 on the basis of Japan's arguments that : (i) the KTC failed to address 
the counterfactual question of how p rices might have been different in the absence of 
dumping; (ii) the "reasonable sales price" analysis was flawed and insufficient, as the KTC 
failed to examine market interactions between the subject imports and domestic like 
products; and (iii)  the KTC ne ver considered whether the alleged price suppression and 
price depression were "significant".  
6.3.9.3   Whether the Korean investigating authorities acted inconsistently with 
Articles  3.1 and 3.4 of the Anti -Dumping  Agreement in their consideration of the impact 
of dumped imports on the state of the domestic industry  
6.27.   Japan argues that the Korean investigating authorities acted inconsistently with Articles  3.1 
and 3.4 of the Anti -Dumping  Agreement because the KTC did not establish any logical link between 
its findings  regarding the volume and price effects under Article  3.2 of the Anti -Dumping  Agreement 
and its finding of impact under Article  3.4. We recall that in reviewing the Panel's finding in the 
context of claim 6, where Japan raised an identical argument, we hav e agreed with the Panel that, 
in order to examine the impact of dumped imports on the domestic industry properly for purposes 
of Article  3.4, an investigating authority is not required to link that examination with its consideration 
of the volume and the p rice effects of the dumped imports. We have also rejected above Japan's 
understanding that Article  3.4 contemplates an exhaustive analysis of all known factors that may 
cause injury to the domestic industry. However, Japan's arguments in the context of its  present 
claim under Articles  3.1 and  3.4, regarding which it requests us to complete the legal analysis, 
encompass broader considerations. Not only does Japan make an argument about the positive trend 
experienced by  the domestic industry with respect to domestic sales, but Japan also asserts that the 
KTC attached a high degree of importance to the other relevant factors highlighting negative aspects 
of the domestic industry, while disregarding or downplaying those factor s that showed positive 
trends. Thus, Japan's contention that, in so doing, the KTC acted inconsistently with Articles  3.1 and 
3.4 would require us to review the KTC's examination of impact and the weight it attributed to each 
of the factors listed in Artic le 3.4 regarding which the Panel, notably, made no findings. Such an 
exercise would require us to review and consider evidence and arguments that were not sufficiently 
addressed by the Panel or sufficiently explored and developed before the Panel.  
a. Conseque ntly, we find ourselves unable to complete the legal analysis as to whether the 
Korean investigating authorities acted inconsistently with Articles  3.1 and 3.4 of the 
Anti-Dumping Agreement  on the basis of Japan's argument that the KTC failed to explain WT/DS504/AB/R  
 
- 147 - 
 
  adequately how imports had negatively impacted the domestic like products as a whole in 
light of positive trends experienced by the domestic industry.  
6.4  Confidential treatment of information  
6.4.1   Whether the Panel erred in finding that Japan's claims 8 and 9 concer ning the 
confidential treatment of information were within its terms of reference  
6.28.   Japan's claims 8 and 9 concerning the confidential treatment of information identify 
Articles  6.5 and 6.5.1 of the Anti -Dumping  Agreement , respectively,  as the provisions all eged to 
have been breached. Japan's claims also indicate that they relate , respectively , to the specific portion 
of the measure concerning Korea's treatment of certain information as confidential under Article  6.5 
of the Anti -Dumping  Agreement and Korea's treatment of non-confidential summaries of confidential 
information under Article  6.5.1 of the Anti -Dumping  Agreement. Article  6.5 establishes a clear and 
well-delineated obligation for investigating authorities to treat information submitted by parties to  
an investigation as confidential if it is "by nature" confidential or "provided on a confidential basis" , 
and "upon  good cause  shown". In addition, Japan's claim  9 refers to the first two sentences of 
Article  6.5.1, which set forth a clear and well -delineated obligation for the investigating authority to 
require non -confidential summaries in sufficient detail to permit a reasonable understanding of the 
substance of the information submitted in confidence. Therefore, Japan's claims 8 and 9 each 
"provi de a brief summary of the legal basis of the complaint sufficient to present the problem clearly" 
within the meaning of Article  6.2 of the DSU. For the foregoing reasons, we find that the Panel did 
not err in finding that Japan's claims 8 and 9, concerning  the confidential treatment of information, 
were within its terms of reference.  
a. Consequently, we uphold  the Panel's findings in paragraphs 7.418 and 8.2.e of the 
Panel  Report . 
6.4.2   Whether the Panel erred in its interpretation or application of Article  6.5 of t he 
Anti-Dumping Agreement  
6.29.   In articulating the legal standard under Article  6.5, the Panel did not pronounce on the specific 
manner in which investigating authorities should specify that "good cause" was shown when granting 
confidential treatment to certain  information. Under Article  6.5, an investigating authority is required 
to assess objectively whether the request for confidential treatment has been sufficiently 
substantiated such that "good cause" has been shown. The fact that the investigating authorit y has 
conducted this objective assessment must be discernible  from its published report or related 
supporting documents. The Panel's analysis comports with the legal standard under Article  6.5. 
Consequently, we find that the Panel did not err in its interp retation of Article  6.5. 
6.30.   Furthermore, with respect to the investigation at issue, the Panel stated that it could not 
"conclude that the Korean Investigating Authorities actually engaged in a consideration of whether 
the submitters of the information had sh own good cause for confidential treatment of the information 
in question". Korea argues that, in providing non -confidential summaries by way of deleting the 
relevant information from their submissions, the providers of the information "implicitly" asserted  
that such deleted information fell within the categories of "confidential information" set forth in the 
relevant Korean laws. In Korea's view, as a consequence of that "implicit" assertion, "good cause" 
was "shown" for granting confidential treatment to t hat information. As noted, the Panel was not 
convinced by this argument because there is no evidence on the record  "linking the information for 
which confidential treatment was granted to the categories of information warranting confidential 
treatment identified in Korean law" . Neither is there evidence  suggesting that "the Korean 
Investigating Authorities themselves undertook to link the information for which confidential 
treatment was sought to the categories defined in Korean legislation and thereby determine whether 
good cause for confidential treatment existed."  Given these Panel findings, we disagree with Korea's  
assertion that , "when  [the] KTC received information that was considered confidential by the 
interested parties, it objectively assessed whether there was indeed 'good cause' by confirming 
whether the deleted information fell within a category of confiden tial information enumerated in the 
relevant Korean laws." Consequently, we find that the Panel did not err in its application of 
Article  6.5.  WT/DS504/AB/R  
 
- 148 - 
 
  a. Consequently, we uphold  the Panel's finding, in paragraphs 7.441, 7.451, and  8.4.b of the 
Panel Report, that Japa n demonstrated that the Korean investigating authorities acted 
inconsistently with Article  6.5 of the A nti-Dumping  Agreement  with respect to their 
treatment of information provided by the applicants as confidential without requiring that 
good cause be shown.  
6.4.3   Whether the Panel erred in its application of Article  6.5.1 of the Anti -Dumping 
Agreement  
6.31.   Article  6.5.1 mandates investigating authorities to require non -confidential summaries from 
interested parties providing confidential information. These summar ies shall be in sufficient detail to 
permit a reasonable understanding of the substance of the information submitted in confidence. In 
the present dispute, the Panel found that, "[i]n the complete absence of data , and with no narrative 
summary  with respect  to the deleted information, the 'Disclosed' versions of the three 
communications identified by Japan cannot be said to contain a summary in sufficient detail to 
'permit a reasonable understanding of the substance of the information submitted in confidence '." 
Korea does not challenge the Panel's appreciation of the facts under Article  11 of the DSU leading 
to the above finding. Instead, Korea repeats certain arguments that the Panel had already rejected 
without explaining why the Panel's analysis constitute s a misapplication  of Article  6.5.1. In light of 
the applicable legal standard and the reasoning provided by the Panel, we fail to see how the versions 
of the submissions from which confidential information had been redacted could satisfy the legal 
standar d of being non -confidential summaries that are "in sufficient detail to permit a reasonable 
understanding of the substance of the information submitted in confidence". In these circumstances, 
we disagree with Korea's argument that "[the] KTC did not fail t o require the applicants to provide 
sufficient non -confidential summaries of the confidential information."  
a. Consequently, we uphold  the Panel's finding, in paragraphs 7.450, 7.451, and  8.4.c of the 
Panel Report, that Japan demonstrated that the Korean investigating authorities acted 
inconsistently with Article  6.5.1 of the Anti-Dumping  Agreement by failing to require that 
the submitting parties provide a sufficient non -confidential summary of the informati on 
for which confidential treatment was sought.  
6.5  Essential facts  
6.5.1   Whether the Panel erred in finding that Japan's claim 10 concerning the disclosure 
of essential facts was not within its terms of reference  
6.32.   Japan's claim 10 concerning the disclosure of essent ial facts identifies Article  6.9 of the 
Anti-Dumping  Agreement as the provision alleged to have been breached by Korea. Claim 10 also 
specifically refers to the Korean investigating authorities' failure "to inform the interested parties of 
the essential facts under  consideration which formed the basis for the decision to impose definitive 
anti-dumping measures". In addition, Article  6.9 sets forth a distinct and well -delineated obligation 
requiring the investigating authority to disclose the essential facts  to all interested parties in a timely 
manner, that is, before the final determination is made and in sufficient time for the parties to defend 
their interests . Thus, Japan's claim 10 "provide[s] a brief summary of the legal basis of the complaint 
sufficie nt to present the problem clearly" within the meaning of Article  6.2 of the DSU. For the 
foregoing  reasons, we find that the Panel erred in finding that Japan's claim 10 concerning the 
disclosure of essential facts was not within its terms of reference.  
a. Consequently, we  reverse  the Panel's finding in paragraphs 7.517 and 8.1.f of the 
Panel  Report, and find that Japan's claim 10 is within the Panel's terms of reference.  
6.5.2   Whether the Appellate  Body  can complete the legal analysis under Article  6.9 of the 
Anti-Dumping Agreement  
6.33.   Because key issues were left unexplored by the Panel and there is a lack of sufficient factual 
findings by the Panel and uncontested facts on the record, there is considerable uncertainty 
regarding when  the "final determination" was reached in the investig ation at issue and which are 
the "disclosure"  documents for purposes of Article  6.9 of the Anti -Dumping Agreement . There is 
therefore no basis for us to determine whether Korea acted inconsistently with Article  6.9 by failing 
to disclose the "essential fac ts" under consideration.