G/SG/Q2/EGY/15  
 
25 June 2015  
(15-3284)  Page: 1/4  
Committee on Safeguards  Original: English  
 
 NOTIFICATION UNDER ARTICLE 12.1(A) OF THE AGREEMENT 
ON SAFEGUARDS ON INITIATI ON OF AN INVESTIGATION 
AND THE REASONS FOR IT 
NOTIFICATION UNDER ARTICL E 12.4 OF THE AGREEMENT 
ON SAFEGUARDS BEFORE TAKING A PROVISIONAL SAFEGUARD MEASURE REFERRED TO IN ARTICLE 6 
REPLIES TO QUESTIONS POSED BY UKRAINE
1  
REGARDING THE NOTIFICATION OF EGYPT2 
(Steel Rebar) 
The following communication, dated 24 June 2015, is being circulated at the request of the 
Delegation of Egypt. 
 
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 Question 1 
 
Egypt imposed provisional sa feguard measures on Steel Rebar on 02/12/2012. These 
duties expired on 19/6/2013 after the investig ating authority had concluded that there 
was no threat to the domestic industry. Thus , safeguard measures were in force during 
200 days and could not be imposed again for at least two years according to Article 7.5 
of the Agreement on Safeguards. However, on 14/10/2014 Egypt imposed provisional safeguard measures on Steel Rebar. Thus, th e non-application period was less then two 
years. 
 Allegations of the investigating authority that  Article 7.5 concerns definitive safeguard 
measures and not provisional ones are unf ounded. Article 7.5 of the Agreement on 
Safeguards does not differentiate betw een definitive safeguard measures and 
provisional. Thus, both definitive and pr ovisional measures can be considered as 
provided for by this article.  
 
Would Egypt please explain on what gro unds safeguard measures were imposed on 
14/10/2014 taking into account the provisions of Article 7.5 of the Agreement on 
Safeguards. 
 Reply: 
 As detailed in notification G/SG/N/6/EGY/10, G/SG/N/7/EGY/9 and G/SG/N/11/EGY/8, Egypt imposed a provisional safeguard measure on impo rts of steel rebar on 14 October 2014 after it 
was established that increased imports of steel rebar were causing serious injury to the domestic 
industry and that critical circumstances existed in which delay would cause damage that would be 
difficult to repair. Because no definitive safeguard measure was imposed in the safeguard investigation that was concluded on 21 November 2013, Egypt was justified in imposing a 
                                               
1 G/SG/Q2/EGY/14. 
2 G/SG/N/6/EGY/10–G/SG/N/ 7/EGY/9–G/SG/N/11/EGY/8. G/SG/Q2/EGY/15 
 
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  provisional safeguard measure. Pursuant to article 7.6 (a) of the SG agreement, the investigating 
authority has the right to "apply again to the import of a product if (a) at least one year has 
elapsed since the date of introduction of a sa feguard measure on the import of that product  …" . 
 
The period between the old investigation and the new one is 15 month which means more than 
one year as the agreement is stated in the mentioned article . 
 
Therefore, the Egyptian authority can impose provisional measures and initiate a new investigation 
again to the import of a product which has been subject to such a measure . 
 
Question 2 
 
On 14/10/2014 a notification was sent to the WTO, and on the same date the decree on the imposition of duties started to apply, wh ich is deemed a procedural violation of the 
Agreement on Safeguards stating that the WTO shall be notified before the introduction 
of duties.  Allegations of the investigating authority th at the provisions of Article 12.4 of the 
Agreement on Safeguards do not identify a specific period for the word "before" and 
that a notification concerning the decree on  the imposition of safeguard measures was 
sent to the Committee on Safeguards "before th e imposition of duties on the same day" 
seems to be not serious. Imposition of the measures on 14/10/2014 does not mean that 
it was not in force before notification was sent to the Committee on Safeguards on the same date. 
 
Obviously, Egypt violated Article 12.4 of th e Agreement on Safeguards by introducing 
safeguard measures on 14/10/2014.  
Would Egypt please identify what specific step s will be taken in the future to insure that 
such delays will not occur again?  
Reply: 
 
The decision to impose a provisional safeguard measure on imports of steel rebar was adopted, 
published and notified to the Committee on Safe guards on 14 October 2014. This decision also 
entered into force on that same date . 
 
Egypt will continue to immediately notify the Committee on Safeguards of any decisions to impose 
provisional safeguard measures pursuant to its ob ligations under Articles 12.18c) and 12.4 of the 
Agreement on Safeguards.  
Question 3 
 Provisional safeguard measur es were imposed without pr ior investigation which is 
inconsistent with the provisions of Arti cle 3.1 of the Agreement on Safeguards. 
 Allegations of the investigating authority that  the measures were applied once a positive 
evidence that the substantial increase in imports had caused serious injury to the 
domestic industry was found is not convin cing. The investigation was initiated on 
13/10/2014 and measures were introduced on 14/10/2014.  
Would Egypt please explain how the investig ating authority managed to make the whole 
analysis of imports evolution an d injury situation in one day? 
 Reply: 
 As detailed in Notice No. 11/2014, which was published in the Egyptian Official Gazette no. 231, supplement a. on 14 October 2014, the investigation concerning imports of steel rebar was 
initiated on the basis of a properly documented application received from the domestic industry on 
25 September 2014. As indicated above and in line  with the requirements of Article 6 of the 
Agreement on Safeguards, a provisional safeguar d measure was only adopted after a preliminary 
determination that increased imports of steel rebar were causing serious injury to the domestic G/SG/Q2/EGY/15 
 
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  industry and that critical circumstances existed in which delay would cause damage that would be 
difficult to repair . 
 
Question 4 
 
Pursuant to Article 12.4 of the Agreement on Safeguards:  
"A Member proposing to apply or exte nd a safeguard measure shall provide 
adequate opportunity for prior consultations with those Members having a substantial interest". 
Would Egypt please explain why such cons ultations were not provided before the 
introduction of the provisional measures? 
 Reply: 
 The second sentence of Article 12.4 of the Agreem ent on Safeguards provides that "Consultations 
shall be initiated immediately after the [provisional] measure is taken". As no request for 
consultations was received by Egypt following the imposition of the provisional safeguard measure 
on imports of steel rebar, no consultations were held.  Question 5 
 
According to information provided in the repo rt of the investigating authority there was 
a decrease in imports in 2013 by 20% as co mpared to 2011 and by 64% as compared to 
2012. Thus there is no year by year recurrence  in imports increase as it is required by 
WTO rules.  
Pursuant to paragraph 131 of the Appellate Body Reports on Argentina — Footwear 
(EC):  
 
"… it is not enough for an investigation to show simply that imports of the 
product this year were more than last ye ar – or five years ago. Again, and it 
bears repeating, not just any increase d quantities of imports will suffice." 
Along with this, there was no significant ov erall impairment in the position of the 
domestic industry in 2010-2014, since most factors of the domestic industry actually 
had positive trends. There was an increase of production by 32% in January-September 
2014 as compared to the same period of 2011. Moreover, there was an increase in 
domestic sales by 25% in January-September 2014 as compared to the same period of 
2011.  Given the fact that in 2013 there was decline in profits by 12% at the same period as 
imports decreased by 20%, it is obvious that imports did not influence domestic 
industry. Thus, there were factors other than increased imports that caused injury to the 
domestic industry at the same time. Injury ma de by these factors shall not be attributed 
to increased imports according to Article 4.2(b) of the Agreement on Safeguards. 
 Taking into account foregoing facts would Egypt please explain how the provisional 
measures on steel rebar comply with Articles 2.1, 4.1 (a), 4.2(b) and 6 of the Agreement 
on Safeguards?  Reply: 
 As detailed in the Final Report on Imposition of a Definitive Safeguard Measure on Imports of Steel 
Rebar Ukraine is referring to, there was an increase in the volume of imports of 120% in 2012 and 
then a decline of 20% in 2013, when compared to 2011. During the first nine months of 2014, the 
volume of imports increased by 251% when compared to the same period in 2011. When assessing the increase in the volume of imports, in  line with the requirements of Article 2.1 of the 
Agreement of Safeguards, Egypt also conducted a dynamic analysis of the trend in the volume of 
imports. As also detailed in the Final Report, it was also established, consistently with the provisions of Article 4 of the Agreement on Safe guards, that the domestic industry was suffering G/SG/Q2/EGY/15 
 
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  serious injury during the period during which the volume of imports significantly increased and 
that there was a causal linked between the increase in imports of the product concerned and the serious injury. In line with the requirements of  Article 4.2(b) of the Agreement on Safeguards 
other factors of injury and their effects were considered . 
 
Moreover, the situation examined by panel in Argentina-peaches was completely different than the present one because Argentina had only relied on three years-almost four in the present 
investigation – and there was a simple decline in imports before a limited increase. 
 
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