WT/DS490/R  
WT/DS496/R  
 
18 August 2017 
(17-4424) Page: 1/47 
  Original: English  
 
  INDONESIA – SAFEGUARD O N CERTAIN IRON OR ST EEL PRODUCTS  
REPORT OF THE PANEL  WT/DS490/ R • WT/DS496/R  
 
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  TABLE OF CONTENTS  
 
1  INTRODUCTION  ................................ ................................ ................................ ...........  8 
1.1  Complaints by C hinese Taipei and Viet Nam  ................................ ................................ ..... 8 
1.2  Panel establishment and composition  ................................ ................................ ..............  8 
1.3  Panel proceedings ................................ ................................ ................................ .........  9 
1.3.1   General  ................................ ................................ ................................ ....................  9 
2  FACTUAL ASPECTS  ................................ ................................ ................................ ....... 9 
2.1  The measures at issue  ................................ ................................ ................................ .. 9 
3  PARTIES' REQUESTS FO R FINDINGS AND RECOM MENDATIONS  ................................ . 10 
3.1  Chinese Taipei and Viet Nam ("Complainants")  ................................ ................................ 10 
3.2  Indonesia  ................................ ................................ ................................ ................... 11 
4  ARGUMENTS OF THE PAR TIES  ................................ ................................ ....................  12 
5  ARGUMENTS OF THE THI RD PARTIES  ................................ ................................ .........  12 
6  INTERIM REVIEW  ................................ ................................ ................................ ....... 12 
7  FINDINGS  ................................ ................................ ................................ ..................  12 
7.1  Standard of review, treaty interpretation, and burden of proof  ................................ .......... 12 
7.1.1   Standard of review  ................................ ................................ ................................ ...12 
7.1.2   Treaty interpretation  ................................ ................................ ................................ .14 
7.1.3   Burden of proof  ................................ ................................ ................................ ........ 14 
7.2  Introduction  ................................ ................................ ................................ ................ 14 
7.3  Whether the specific duty on imports of galvalume constitute s a "safeguard 
measure" within the meaning of Article 1 of the Agreement on Safeguards  ............................... 15 
7.3.1   Definition of a safeguard measure ................................ ................................ ............... 15 
7.3.2   The specific duty at issue does not suspend, withdraw, or modify a relevant GATT 
obligation for the purpose of remedying or preventing serious injury  ................................ ........ 16 
7.3.2.1   No binding WTO ta riff obligation with respect to imports of galvalume  .......................... 16 
7.3.2.2   No other relevant GATT obligations preclude the adoption of the specific duty  ............... 17 
7.3.3   Consequences of the fact that the specific duty was adopted following an 
investigation conducted by Indonesia's competent authority pursuant to Indonesia's 
safeguards legislation with a view to complying with the Agreement on Safeg uards  ................... 20 
7.3.4   Conclusion  ................................ ................................ ................................ ............... 22 
7.4  Whether the exclusion of 120 countries from the application of the specific duty 
imposed purs uant to Regulation No. 137.1/PMK.011/2014 is inconsistent with Indonesia's 
obligation to afford MFN -treatment under Article I:1 of the GATT  ................................ ............. 23 
7.5  The complainants' claims under the Agreement  on Safeguards and Articles  XIX:1(a) 
and XIX:2 of the GATT 1994  ................................ ................................ ................................ 24 
7.5.1   Unforeseen developments and the effect of GATT 1994 obligations  ................................ .24 
7.5.1.1   Parties' arguments  ................................ ................................ ................................ .24 
7.5.1.2   Relevant law  ................................ ................................ ................................ ......... 25 
7.5.1.3   Relevant facts  ................................ ................................ ................................ .......26 
7.5.2   Increased imports  ................................ ................................ ................................ .....27 
7.5.2.1   Parties' arguments  ................................ ................................ ................................ .27 WT/DS490/R • WT/DS496/R  
 
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  7.5.2.2   Relevant law  ................................ ................................ ................................ ......... 28 
7.5.2.3   Relevant facts  ................................ ................................ ................................ .......29 
7.5.3   Threat of serious injury  ................................ ................................ ............................. 30 
7.5.3.1   Parties' arguments  ................................ ................................ ................................ .30 
7.5.3.2   Relevant law  ................................ ................................ ................................ ......... 31 
7.5.3.3   Relevant facts  ................................ ................................ ................................ .......32 
7.5.4   Causation  ................................ ................................ ................................ ................ 34 
7.5.4.1   Parties' arguments  ................................ ................................ ................................ .34 
7.5.4.2   Relevant law  ................................ ................................ ................................ ......... 35 
7.5.4.3   Relevant facts  ................................ ................................ ................................ .......36 
7.5.4.3.1   "Other Factors"  ................................ ................................ ................................ ...36 
7.5.4.3.2   "Causal link"  ................................ ................................ ................................ .......38 
7.5.5   Application of the specific duty  ................................ ................................ ................... 39 
7.5.5.1   Parties' arguments  ................................ ................................ ................................ .39 
7.5.5.2   Relevan t law ................................ ................................ ................................ ......... 39 
7.5.5.3   Relevant facts  ................................ ................................ ................................ .......40 
7.5.6   Notification  ................................ ................................ ................................ .............. 40 
7.5.6 .1  Parties' arguments  ................................ ................................ ................................ .40 
7.5.6.2   Relevant law  ................................ ................................ ................................ ......... 41 
7.5.6.3   Relevant facts  ................................ ................................ ................................ .......42 
7.5.7   Consultations  ................................ ................................ ................................ ........... 43 
7.5.7.1   Parties' arguments  ................................ ................................ ................................ .43 
7.5.7.2   Relevant law  ................................ ................................ ................................ ......... 44 
7.5.7.3   Relevant facts  ................................ ................................ ................................ .......45 
8  CONCLUSIONS AND RECO MMENDATIONS  ................................ ................................ .. 47 
 
 WT/DS490/ R • WT/DS496/R  
 
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  LIST OF ANNEXES  
ANNEX  A 
INTERIM REVIEW AND W ORKING PROCEDURES OF THE PANEL  
Contents  Page  
Annex  A-1 Working Procedures of the Panel  A-2 
Annex  A-2 Additional Working Procedures of the Panel concerning Business Confidential 
Information  A-7 
Annex  A-3 Interim Review  A-9 
ANNEX B  
ARGUMENTS OF THE PAR TIES 
Contents  Page  
Annex  B-1 Integrated executive summary of the arguments of the complainants  B-2 
Annex  B-2 Integrated executive summary of the arguments of Indonesia  B-25 
ANNEX C  
ARGUMENTS OF THE THI RD PARTIES  
Contents  Page  
Annex  C-1 Integrated executive summary of the arguments of Australia  C-2 
Annex  C-2 Integrated executive summary of the arguments of the European Union  C-4 
Annex  C-3 Integrated executive summary of the arguments of Japan  C-7 
Annex  C-4 Integrated executive summary of the arguments of Ukraine  C-10 
Annex C-5 Integrated executive summary of the arguments of the United States  C-12 
 WT/DS490/R • WT/DS496/R  
 
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  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 – Footwear (EC)  Panel Report, Argentina – Safeguard Measures on Imports of Footwear , 
WT/DS121/R , adopted 12 January 2000, as modified by Appellate Body 
Report WT/DS121/AB/R, DSR 2000:II, p. 575  
Argentina – Preserved Peaches  Panel Report, Argentina – Definitive Safeguard Measure on Imports of 
Preserved Peaches , WT/DS238/R , adopted 15 April 2003, DSR 2003:III, 
p. 1037 
Canada – Autos  Appellate Body Report,  Canada – Certain Measures Affecting the Automotive 
Industry , WT/DS139/AB /R, WT/DS142/AB/R , adopted 19 June 2000, 
DSR 2000:VI, p. 2985  
Chile – Price Band System  Panel Report, Chile – Price Band System and Safeguard Measures Relating to 
Certain Agricultural Products , WT/DS207/R , adopted 23 October 2002, as 
modified by Appellate Body Report WT/DS207AB/R, DSR 2002:VIII, p. 3127  
China – Auto Parts  Appellate Body Reports, China – Measures Affecting Imports of Automobile 
Parts, WT/DS339/AB/R  / WT/DS340/AB/R  / WT/DS342/AB/R , adopted 
12 January 2009, DSR 2009:I, p. 3  
Dominican Republic – 
Safeguard Measures  Panel Report, Dominican Republic – Safeguard Measures on Imports of 
Polyprop ylene Bags and Tubular Fabric , WT/DS415/R , WT/DS416/R , 
WT/DS417/R , WT/DS418/R , and Add.1 , adopted 22 February 2012, 
DSR 2012:XIII, p. 6775  
EC – Hormones  Appellate Body Report, EC Measures Concerning Meat and Meat Products 
(Hormones) , WT/DS26/AB/R , WT/DS48/AB/R , adopted 13 February 1998, 
DSR 1998:I, p. 135  
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 – Dairy Panel Report, Korea – Definitive Safeguard Measure on Imports of Certain 
Dairy Products , WT/DS98/R  and Corr.1, adopted 12 January 2000, as 
modified by Appellate Body Report WT/DS98/AB/R, DSR 2000:I, p. 49  
Turkey – Textiles  Appellate Body Report, Turkey – Restrictions on Imports of Textile and 
Clothing Products , WT/DS34/AB/R , adopted 19 November 1999, 
DSR 1999:VI, p. 2345  
Ukraine – Passenger Cars  Panel Report, Ukraine – Definitive Safeguard Measures on Certain Passenger 
Cars, WT/DS468/R  and Add. 1, adopted 20 July 2015  
US – Cotton Yarn  Appellate Body Report, United States – Transitional Safeguard Measure on 
Combed Cotton Yarn from Pakistan , WT/DS192/AB/R , adopted 
5 November  2001, DSR 2001:XII, p. 6027  
US – Gambling  Panel Report, United States – Measures Affecting the Cross -Border Supply of 
Gambling and Betting Serv ices, WT/DS285/R , adopted 20 April 2005, as 
modified by Appellate Body Repo rt WT/DS285/AB/R, DSR 2005:XII, p. 5797  
US – Gasoline  Appellate Body Report, United States – Standards for Reformulated and 
Conventional Gasoline , WT/DS2/AB/R , adop ted 20 May 1996, DSR 1996:I, 
p. 3 
US – Lamb  Appellate Body Report, United States – Safeguard Measures on Imports of 
Fresh, Chilled or Frozen Lamb Meat from New Zeal and and Australia , 
WT/DS177/AB/R , WT/DS178/AB/R , adopt ed 16 May 2001, DSR 2001:IX, 
p. 4051 
US – Lamb  Panel Report, United States – Safeguard Me asures on Imports of Fresh, 
Chilled or Frozen Lamb Meat from New Zealand and Australia , WT/DS177/R , 
WT/DS178/R , adopted 16 May 2001, as modified by Ap pellate Body Report 
WT/DS177/AB/R, WT/DS178/AB/R, DSR 2001:IX, p. 4107  
US – Line Pipe  Appellate Body Report, United States – Definitive Safeguard Measures on 
Imports of Circular Welded Carbon Quality Line Pipe from Korea , 
WT/DS202/AB/R , adopted 8 March 2002, DSR 2002:IV, p. 1403  WT/DS490/ R • WT/DS496/R  
 
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  Short title  Full case title and citation  
US – Line Pipe  Panel Report, United States – Definitive Safeguard Measures on Imports of 
Circular Welded Carbon Quality Line Pipe from Korea , WT/DS202/R , adopted 
8 March 2002, as modified by Appellate B ody Report WT/DS202/AB/, 
DSR 2002:IV, p. 1473  
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 – Steel Safeguards  Appellat e 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 – Steel Safeguards  Panel Reports, United States – Definitive Safeguard Measures on Imports of 
Certain Steel Products , WT/DS2 48/R and Corr.1 / WT/DS249/R  and Corr.1 / 
WT/DS251/R  and Corr.1 / WT/DS252/R  and Corr.1 / WT/DS253/R  and 
Corr.1 / WT/DS254/R  and Corr.1 / WT/DS258/R  and Corr.1 / WT/DS259/R  
and Corr.1, adopted 10 December 2003, as modified by Appellate Body 
Report 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, DSR 2003:VIII, p. 3273  
US – Tyres (China)  Appellate Body Report, United States – Measures Affecting Imports of 
Certain Passenger Vehicle and Light T ruck Tyres from China , 
WT/DS399/AB/R , adopted 5 October 2011 , DSR 2011:I X, p. 4811  
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 – Wheat Gluten  Panel Report, United States – Definitive Safeguard Measures on Imports of 
Wheat Gluten from the European Communities , WT/DS166/R , adopted 
19 January 2001, as modified by Appellate Body Report WT/DS166/AB/R, 
DSR 2001:III, p. 779  
US – Wool Shirts and Blouses  Appellate Body Report, United States – Measure Affecting Imports of Woven 
Wool Shirts and Blouses from India , WT/DS33/AB/R , adopted 23 May 1997, 
and Corr.1, DSR 1997:I, p. 323  
 WT/DS490/R • WT/DS496/R  
 
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  ABBREVIATIONS USED I N THIS REPORT  
Abbreviation  Descriptio n 
ASEAN  Association of Southeast Asian Nations  
BEP Break Even Point  
DSB Dispute Settlement Body  
DSU Understanding on Rules and Procedures Governing the Settlement of Disputes  
FTA Free trade agreement  
GATT 1994  General Agreement on Tariffs and Trade 1994 
HS Harmoni zed System  
KPPI Komite Pengamanan Perdagangan Indonesia  
MFN most-favoured -nation  
POI Period of investigation  
Rp Indonesian Rupiah  
RTA Regional trade agreement  
S&D Special and differential treatment  
Vienna Convention  Vienna Convention  on the Law of Treaties, Do ne at Vienna, 23 May 1969, 
1155 UNTS 331; 8 International Legal Materials 679  
WTO World Trade Organization  
 WT/DS490/ R • WT/DS496/R  
 
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  1  INTRODUCTION  
1.1  Complaints by Chinese Taipei and Viet Nam  
1.1.  On 12 February 2015, the Separate Customs Territory of Taiwan, Penghu, Kinmen , and 
Matsu (Chinese Taipei) requested consultations with Indonesia pursuant to Articles  1 and 4 of the 
Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU), Article XXII 
of the General Agreement on Tariffs and Tra de 1994 (GATT 1994) and Article 14 of the Agreement 
on Safeguards .1 On 1 June 2015, Viet Nam requested consultations with Indonesia pursuant to the 
same provisions .2  
1.2.  In both complaints, the measures subject to consultations were described as the following3:  
a. The specific duty imposed by Indonesia as a safeguard measure on imports of flat -rolled 
product of iron or non -alloy steel, of a width of 600 mm or more, clad, plated , or coated 
with aluminium -zinc alloys, containing by weight less than 0.6% of carbon,  with a 
thickness not exceeding 1.2mm, under Harmonized System ( HS) code 7210.61.11.00.  
b. Indonesia's notification to the WTO Committee on Safeguards of the finding of threat of 
serious injury caused by increased imports and of a proposal to impose a safegua rd 
measure.  
c. Indonesia's failure to provide an opportunity for consultations on relevant information 
related to the safeguard measure, including on the proposed measure and its date of 
introduction prior to the actual imposition of the measure.  
1.3.  Consultation s were held between Chinese Taipei and Indonesia on 16 April 2015, and 
between Viet Nam and Indonesia on 28 July 2015. The consultations failed to resolve the disputes.  
1.2  Panel establishment and composition  
1.4.  Chinese Taipei and Viet Nam each requested, respec tively on 20 August 2015 and 
15 September 2015, the establishment of a panel pursuant to Articles 4.7 and 6 of the DSU, 
Article 14 of the Agreement on Safeguards, and Article XXIII of the GATT 1994.4 
1.5.  At its meeting on 28  September 2015, the Dispute Settleme nt Body (DSB) established a 
panel pursuant to Chinese Taipei's request in document WT/DS490/2, in accordance with Article  6 
of the DSU.5 At its meeting on 28 October 2015, the DSB established another panel pursuant to 
Viet Nam's request in WT/DS496/3, in a ccorda nce with Article 6 of the DSU. At the same meeting, 
the DSB decided that the panel established at its meeting of 28 September 2015 in WT/DS490 
would also examine the dispute in WT/DS496, in accordance with Article 9.1 of the DSU.6 
1.6.  The Panel's t erms o f reference are the following:  
To examine, in the light of the relevant provisions of the covered agreements cited by 
the parties to the disputes, the matter referred to the DSB by the Separate Customs 
Territory of Taiwan, Penghu, Kinmen and Matsu in docum ent WT/DS490/2 and 
Viet Nam in document WT/DS496/3, and to make such findings as will assist the DSB 
                                                
1 Chinese Taipei's request for consultations, WT/DS490/1 (Chinese Taipei's consultations request).  
2 Viet Nam's request for consultations, WT/DS496/1 (Viet Nam's consultations request).  
3 Chinese Taipei's consultations request, par a. 5; and Viet Nam's consultations request, para. 5.  
4 Chinese Taipei's request for the establishment of a panel, WT/DS490/2 (Chinese Taipei's panel 
request); and Viet Nam's request for the establishment of a panel, WT/DS496/3 (Viet Nam's panel request).  
5 DSB, Minutes of the meeting held in the Centre William Rappard on 28 September 2015 (circulated 
23 November 2015), WT/DSB/M/368.  
6 DSB, Minutes of the meeting held in the Centre William Rappard on  28 October 2015 (circulated 
20 January 2016) , WT/DSB/M/369 . WT/DS490/R • WT/DS496/R  
 
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  in making the recommendations or in giving the rulings provided for in those 
agreements.7 
1.7.  On 1 December 2015, Chinese Taipei and Viet Nam requested the Dir ector-General to 
determine the composition of the Panel, pursuant to Article  8.7 of the DSU. On 9 December  2015, 
the Director -General composed the Panel as follows:  
Chairperson:   Ms Luz Elena Reyes de la Torre  
Members:  Mr José Pérez Gabilondo  
 Mr Guillermo  Valles  
1.8.  Australia, Chile, China, the European Union, India,  Japan,  Korea, the Russian Federation, 
Ukraine,  and the United States reserved their rights to participate in  the Panel proceedings as 
third parties. In addition, Chinese Taipei reserved its right  to participate in the Panel proceedings 
of DS496 as a third party, and Viet Nam reserved its right to participate in the Panel proceedings 
of DS490 as a third party .8 
1.3  Panel proceedings  
1.3.1   General  
1.9.  The Panel began its work on this case later than it would have  wished due to staff constraints 
in the WTO Secretariat.9 After consultation with the parties, the Panel adopted its Working 
Procedures10 and timetable on 1 July 2016 , and additional procedures for the protection of 
Business Confidential Information (BCI)  on 22 July 2016 .11 The Pa nel revised its timetable on 
22 July and 19 December 2016, and again on 1 May 2017. 
1.10.   The Panel met with the parties on 5 -6 October  2016 and 16 December  2016, and with the 
third parties on 6 October 2016.  
1.11.   The Panel su bmitted its inter im report to the parties on 5 April  2017 and submitted its final 
report to the parties on 18 May  2017. 
2  FACTUAL ASPECTS  
2.1  The measures at issue  
2.1.  This dispute concerns the specific duty applied by Indonesia on imports of g alvalum e defined 
as, flat -rolled produc ts of iron or non -alloy steel, of a width of 600 mm or more, clad, plated , or 
coated with aluminium -zinc alloys, containing by weight less than 0 .6% of carbon, with a thickness 
not exceeding 0 .7mm, under HS code 7210.61.11.00. The specific duty was imposed  following an 
investigation initiated and conducted under Indonesia's domestic safeguards legislation by 
Indonesia's competent authority  (Komite Pengamanan Perdagangan Indonesia , or KPPI) .  
2.2.  The specific duty was adopted for a period of three years pursuant  to 
Regulation  No. 137.1/PMK.011/2014  of the Minister of Finance of the Republic of Indonesia,  which 
entered into force on 22 July 2014.12 Indonesia applies the specific duty to imports of galvalume 
from all sources, with the exception of 120 allegedly deve loping countries listed in Indonesia's 
                                                
7 Indonesia – Safeguard on Certain Iron or Steel Products , constitution note of the Panel, WT/DS490/3 
WTDS496/4, para. 2.  
8 Indonesia – Safeguard on Certain Iron or Steel Products , constitution note of the Panel, WT/DS490/3 
WTDS496/4, para. 5.  
9 Communic ation from the Panel (circulated 13 Jun e 2016), WT/DS490/4 WT/DS496/5.  
10 See the Panel's  Working Procedures in Annex A-1. 
11 See the Panel's Additional Working Procedures on Bu siness Confidential Information in  Annex A-2. 
12 Regulation of the Minister of Fin ance of the Republic of Indonesia No. 137.1/PMK.011/2014 on 
imposition of safeguarding duty against the import of flat -rolled products of iron or non -alloy steel 
(22 July 2014), (Exhibits IDN -20 (translated version ) and VNM/TPKM -4 (both original and transl ated 
version s)). WT/DS490/ R • WT/DS496/R  
 
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  notification to the WTO Committee on Safeguards under Article 9.1 of the Agreement on 
Safeguards .13 The following table sets out the precise amounts and the timetable of application of 
the specific duty that was notifi ed to the WTO Committee on Safeguards.  
Table 1: Timetable of the Safeguard Duty  
Period  Duty  
22 July 2014 - 21 July 2015  Rp 4,998,784 per ton  
22 July 2015 - 21 July 2016  Rp 4,314,161 per ton  
22 July 2016 - 21 July 2017  Rp 3,629,53 8 per ton  
 Source:  Committee on Safeguards, Notification Under Articles 9, 12.1(b), and 12.1(c) of the 
Agreement on Safeguards (28 July 2014), G/SG/N/8/IDN/16/Suppl.1, 
G/SG/N/10/IDN/16/Suppl.1, G/SG/N/11/IDN/14, (Exhibit TPKM/VNM -5), p. 2  
2.3.  Indonesia has no  binding tariff obligation with respect to galvalume inscribed into its 
Schedule of Concession s for the purpose of Article II of the GATT 1994.  At the time of the request 
for consultations, the duty rate applied by Indonesia on imports of galvalume on a 
most-favoured -nation (MFN) basis was 12.5%. This MFN -rate was increased to 20% in 
May 2015.14 Indonesia applies duty rates ranging from 0% to 12.5% on imports of galvalume from 
its trading partners under four separate regional trade agreements  (RTAs)  – the As sociation of 
Southeast Asian Nations (ASEAN) -China Free Trade Agreement (12.5%), the ASEAN -Korea Free 
Trade Agreement (10%), the ASEAN Trade in Goods Agreement (0%) and the Indonesia -Japan 
Economic Partnership Agreement (12.5%).15 The specific duty that is at issue in this proceeding is 
applied in addition to  the existing MFN and preferential duty rates.16 
3  PARTIES' REQUESTS FO R FINDINGS AND RECOM MENDATIONS  
3.1  Chinese Taipei and Viet Nam (" Complainants ")17 
3.1.  The complainants request the Panel to find as follows:  
a. That the specific duty  is a safeguard measure within the meaning of Article 1 of the 
Agreement on Safeguards, which Indonesia adopted and applied inconsistently  with the 
following obligations : 
i. Article XIX:1(a) of the GATT 1994 and Article 3.1 of the Agreement  on Safeguards 
because KPPI failed  to demonstrate the existence of "unforeseen developments" , 
"the effect of the [GATT] obligations" and the "logical connection " between these 
two elements and the increase in imports that allegedly caused serious injury;  
ii. Article XIX:1(a) of the GATT 1994 and Articles 2.1 and 3.1 of the Agreement on 
Safeguards  (and, consequently, Articles 4.2(a) and 4.2(c) of the Agreement on 
Safeguards ) because KPPI's determination of increased imports was not based on an 
increase in import s that is "recent enough";  
iii. Article XIX:1(a) of the GATT 1994 and Articles 2.1, 3.1, 4.2(a) , and 4.2(c) of the 
Agreement on Safeguards because KPPI failed  to provide a reasoned and adequate 
                                                
13 Committee on Safeguards, Notification Under Articles 9, 12.1(b), and 12.1(c) of the Agreement on 
Safeguards (28 July 2014),  G/SG/N/8/IDN/16/Suppl.1, G/SG/N/10/IDN/16/Suppl.1, G/SG/N/11/IDN/14, 
(Exhibit TPKM/VNM -5), pp. 2 and 3.  
14 Regulat ion of the Minister of Finance of the Republic of Indonesia No. 97/PMK.010/2015, 
(Exhibit  TPKM/VNM -40). 
15 Final Disclosure Report concerning the importation of flat -rolled products of iron or non -alloy under 
HS code 7210.61.11.00  (Final Disclosure Report) , (Exhibits IDN -8 (both original and translated version s) and 
VNM/TPKM -1 (translated version) ), Table  3 and para. 30 . 
16 Indonesia's response to Panel question No. 53; complainants' comments on Indonesia's response to 
Panel question No. 53.  
17 Throughout the proceeding, Chinese Taipei and Viet Nam have advanced almost identical claims, and 
made common submissions, oral statements , and answ ers to Panel questions. In this Report, c laims not 
advanced by both complainants are identified.   WT/DS490/R • WT/DS496/R  
 
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  explanation of how the facts support the determination of threat o f serious injury, 
including the evaluation of all relevant serious injury indicators;  
iv. Article 4.1(b) of the Agreement on Safeguards (Viet Nam only) because KPPI's 
finding of threat of serious injury is inconsistent with the definition of "threat of 
serious  injury" under that provision;  
v. Article XIX:1(a) of the GATT 1994 and Articles 2.1, 3.1, 4.2(b), and 4.2(c) of the 
Agreement on Safeguards because KPPI failed to establish a causal link and to 
conduct a proper non -attribution analysis in accordance with th ese provisions;  
vi. Articles 2.1, 3.1, 4.2(a) , and 4.2(b) of the Agreement on Safeguards because KPPI 
failed  to observe the required "parallelism " by applying the specific duty to a product 
that is different from the product that was the subject of its investi gation,  and failed 
to provide a reasoned and adequate explanation thereof;   
vii. Article I:1 of the GATT 1994 because KPPI excluded from the application of the 
specific duty products originating in the countries li sted in the Annex to 
Regulation  No. 137.1/PMK.0 11/2014, and not according that exemption immediately 
and unconditionally to like products originating in the territory of some Members, 
including the complainants ; 
viii. Article 12.2 of the Agreement on Safeguards  because Indonesia failed to provide "all 
pertin ent information" in the notification s of the finding of threat of serious  injury 
and the proposal to impose a safeguard measure  to the WTO Committee on 
Safeguards ; and 
ix. Article XIX:2 of the GATT 1994 and Article 12.3 of the Agreement on Safeguards 
because I ndonesia failed  to provide a reasonable opportunity to hold prior 
consultations . 
b. That, were  the Panel to find that the specific duty is not a safeguard measure within the 
meaning of Article 1 of the Agreement on Safeguards, the specific duty is, in any cas e, 
inconsistent with Indonesia's obligations under Article I:1 of the GATT 1994 to the extent 
it is applied in a manner that discriminates between sources of imports of galvalume.  
3.2.  Accordingly, the complainants  request the Panel to recommend that Indonesia  bring its 
measures into conformity with the above -cited provisions of the GATT 1994 and the Agreement on 
Safeguards  and, furthermore, that the Panel exercise its discretion under Article 19 of the DSU and 
suggest that Indonesia do so by withdrawing the sp ecific duty . 
3.2  Indonesia  
3.3.  Indonesia requests the Panel to find that  the specific duty  is a safeguard measure within the 
meaning of Article 1 of the Agreement  on Safeguards, which Indonesia adopted and applied 
consistently  with its obligations under the GATT 1 994 and the Agreement on Safeguards.   
3.4.  To the extent that the Panel may find that the specific duty is not a safeguard measure within 
the meaning of Article 1 of the Agreement on Safeguards, Indonesia requests that the Panel 
dismiss the entirety of the comp lainants' claims under the Agreement on Safeguards.  
3.5.  Finally, in the event that the Panel were to find that Indonesia has failed to comply with its 
obligations under the GATT 1994 and/or the Agreement on Safeguards, Indonesia asks t he Panel 
to reject the co mplainants' request for the Panel to suggest that the only manner in which 
Indonesia may bring its measures into conformity with its obligations is by immediately 
withdrawing the specific duty, leaving Indonesia the discretion to choose the means by which to 
implement the Panel's  recommendation.  WT/DS490/ R • WT/DS496/R  
 
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  4  ARGUMENTS OF THE PAR TIES  
4.1.  The arguments of the parties, as described in the executive summaries of the  submissions 
made throughout the course of this proceeding , are attached to this Report as annexes (see 
Annexes  B-1 and B -2). 
5  ARGUMENTS OF THE THI RD PARTIES  
5.1.  The arguments of the third parties, as described in the executive summaries of their 
submissions, are attached to this Report as annexes (see Annexes C -1 to C -5). Third parties  that 
filed third -party submissions w ere the European Union, Japan,  and Ukraine. Third parties that 
made oral statements at the meeting with the Panel were Australia, the European Union, Japan, 
Ukraine,  and the United States.   
6  INTERIM REVIEW  
6.1.  On 5 April 2017, the Panel issued its Interim Repor t to the parties. On 13 April 2017, the 
complainants and Indonesia each submitted written requests for the Panel to review precise 
aspects of the Interim Report. Neither party requested an inte rim review meeting. On 
27 April 2017, both parties submitted co mments on the other party's requests for review.  
6.2.  The parties' requests made at the interim review stage as well as the Panel's discussion and 
disposition of those requests are set out in Annex A -3. 
7  FINDINGS  
7.1  Standard of review, treaty interpretation , and b urden of proof  
7.1.1   Standard of review  
7.1.  The Agreement on Safeguards is silent as to  the standard of review to be applied by panels in 
reviewing the WTO -consistency of safeguard measures . However, it is well established that the 
general standard of review contain ed in Article 11 of the DSU is applicable to disputes involving 
claims of violation  of the Agreement on Safeguards  and Article XIX of the GATT 1994.18 
7.2.  Article 11 of the DSU specifies that a panel  must make an objective assessment of the matter 
before it, in cluding an objective assessment of the facts of the case and the applicability of and 
conformity with the relevant covered agreements.19 As applied in disputes involving complaints 
brought under the Agreement on Safeguards, t his standard has been interprete d to mean that :  
[P]anels must examine whether the competent authority has evaluated all relevant 
factors; they must assess whether the competent authority has examined all the 
pertinent facts and assessed whether an adequate explanation has been provided as 
to how those facts support the determination; and they must also consider whether 
the competent authority's explanation addresses fully the nature and complexities of 
the data and responds to other plausible interpretations of the data. However, panels 
must not conduct a de novo  review of the evidence nor substitute their judgement for 
that of the competent authority.20  
                                                
18 See, e.g. Appellate Bod y Reports, Argentina – Footwear (EC) , para. 120; and US – Lamb , 
paras.  100-102; and Panel Report, Dominican Republic – Safeguard Measures , para. 7.4.  
19 Article 11 of the DSU provides in relevant part that : "[t]he function of panels is to assist the DSB in 
discharging its responsibilities under this Understanding and the covered agreements. Accordingly, a panel  
should make an objective assessment of the matter before it, including an objective assessment of the facts of 
the case and the applicability of and conformity with the relevant covered agreements, and make such other 
findings as will assist the DSB in making the recommendations or in giving the rulings provided  for in the 
covered agreements".  
20 Appellate Body Report, US – Cotton Yarn , para. 74 (referr ing at paras. 71 -73 to Appellate Body 
Reports, Argentina – Footwear (EC) , para. 121; US – Lamb , para. 103; and US – Wheat Gluten , para. 55).  WT/DS490/R • WT/DS496/R  
 
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  7.3.  Thus, a  panel 's examina tion of a competent authority's  determination in a safeguard 
proceeding must involve  neither a de novo  review nor  "total deference"  to the competent 
authority's determination .21 Rather, a panel  is required to assess w hether the competent authority  
has examined all relevant facts and provided a reasoned and adequate explanation as to how the 
facts support its determina tion.22 A panel can make this assessment :  
[O]nly  if the panel  critically examines that explanation, in depth, and in the light of 
the facts before the panel . Panels must, therefore, review whether the competent 
authorities' explanation fully addresses the nature, and, especially, the complexities, 
of the data, and responds to other plausible interpretations of that data. A panel  must 
find, in particular, that an explanation is not reasoned, or is not adequate, if some 
alternative explanation  of the facts is  plausible, and if the competent 
authorities'  explanation does not seem adequate in the light of that alternative 
explanation.23  
7.4.  Article 3.1, last sentence, requires competent authorities to publish a report setting forth 
their findings and reasoned conclu sions reached on all pertinent issues of fact and law. Similarly , 
Article 4.2(c) requires competent authorities to publish promptly, in accordance with the provisions 
of Article 3, a detailed analysis of the case under investigation as well as a demonstrat ion of the 
relevance of the factors examined.  
It is precisely by "setting forth findings and reasoned conclusions on all pertinent 
issues of fact and law ", under Article 3.1, and by providing "a detailed analysis of the 
case under investigation as well as  a demonstration of the relevance of the factors 
examined ", under Article 4.2(c), that competent authorities provide panels with the 
basis to "make an objective assessment of the matter before it " in accordance with 
Article 11.  … [A] panel may not conduct a de novo  review of the evidence or 
substitute its judgement for that of the competent authorities. Therefore, t he 
"reasoned conclusions" and "detailed analysis" as well as "a demonstration of the 
relevance of the factors examined" that are contained in th e report of a competent 
authority, are the only bases on which a panel  may assess whether a competent 
authority has complied with its obligations under the Agreement on Safeguards  and 
Article XIX:1(a) of the GATT 1994.24 
7.5.  Thus, a  panel 's assessment of whethe r a competent authority's determinations are consistent 
with the Agreement on Safeguards and Article XIX:1(a) of the GATT 1994 must be based on the 
relevant report published by that authority .25  
7.6.  Panels should not be "left to 'deduce for themselves' from th e report of that competent 
authority the 'rationale for the determinations from the facts and data contained in the report of 
the competent authority'".26 The explanations contained in a competent authority's published 
report must be "explicit", "clear and unambiguous", and must not "merely imply or suggest an 
explanation".27  
7.7.  Where there is no reasoned and adequate explanation apparent in the published report to 
support a competent authority's determinations, "the panel has no option but to find that the 
competent authority has not performed the analysis correctly".28 This implies that reasoning, 
analysis and demonstrations provided after publication of the report – i.e. ex post  explanations – 
                                                
21 Appellate Body Reports, US – Lamb , para. 101; US – Tyres (China) , para. 123; US – Cotton Yarn , 
para. 69; and Argentina – Footwear (EC) , para. 119.  
22 Appellate Body Reports, US – Lamb , para. 103; US – Line Pipe , para. 217; and US – Steel 
Safeguards , paras. 296  and 297. 
23 Appellate Body Report, US – Lamb , para. 106  (emphasis original) . See also Appellate Body Report, 
US – Steel Safeguards , para. 276 . 
24 Appellate Body Report, US – Steel Safeguards , para. 299.  (fn omitted)  
25 See, e.g. Appellate Body Reports, US – Steel Safeguards , para. 299; and US – Lamb , para. 105; and 
Panel Report, Dominican Republic – Safeguard Measu res, para. 7.9.  
26 Appellate Body Report, US – Steel Safeguards , para. 288.  
27 Appellate Body Report s, US – Steel Safeguards , paras. 296  and 297; and US – Line Pipe , para. 217.  
28 Appellate Body Report, US – Steel Safeguards , para. 303.  WT/DS490/ R • WT/DS496/R  
 
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  are irrelevant and cannot be relied upon to remedy any deficiencies  of the competent 
authorities'  determinations.  
7.1.2   Treaty interpretation  
7.8.  Article 3.2 of the DSU provides that the dispute settlement system serves to clarify the 
existing provisions of the covered agreements "in accordance with customary rules of 
interpretatio n of public international law". It is generally accepted that the principles codified in 
Articles  31 and 32 of the Vienna Convention are such customary rules.29 
7.1.3   Burden of proof  
7.9.  The general principles applicable to the allocation of the burden of proof in WT O dispute 
settlement require that a party claiming a violation of a provision of a WTO Agreement must assert 
and prove its claim.30 Therefore, in this dispute, Chinese Taipei and Viet Nam bear  the burden of 
demonstrating that the challenged measures are inconsistent with Indonesia's obligations under 
the relevant WTO coverage agreements . A complaining party will satisfy its burden when it 
establishes a prima facie  case, namely a case which, in the absence of effective refutation by the 
defending party, requi res a panel, as a matter of law, to rule in favour of the complaining party.31 
It is generally for each party asserting a fact to provide proof thereof.32 
7.2  Introduction  
7.10.   A fundamental question that arises in this disput e is whether the specific duty  applied by  
Indonesia on imports of galvalume pursuant to Regulation No. 137.1/PMK.011/2014 is a 
"safeguard measure" within the meaning of Article 1 of the Agreement on Safeguards. Although 
both sides maintain, albeit for somewhat different reaso ns, that the challeng ed measure  is a 
safeguard  measure within the scope of the Agreement on Safeguards, their arguments have led us 
to conclude, in discharging our duty to undertake "an objective assessment of the matter"33, that 
we must examine this issue for ourselves, rather  than simply proceeding on the basis of the 
parties'  concurring positions. Having done so, we have come to the conclusion that the s pecific 
duty at issue in this dispute is not a "safeguard measure" within the meaning of Article 1 of the 
Agreement on Safeg uards.  We explain the reasons for arriving at this conclusion in the section that 
follow s, before evaluating the mer its of the complainants' alternative claim that Indonesia's 
application of the specific duty, as a stand -alone measure , is inconsistent with  Article I:1 of the 
GATT 1994.   
7.11.   While we do not take a position with respect to the merits of the complainants' claims 
against the specific duty, as a safeguard measure , we address their specific allegations of 
inconsistency with the Agreement on Safeguard s and Articles  XIX:1(a) and XIX:2 of the 
GATT  1994 in the final section of our findings , where we identify  facts relevant to an evaluation of 
their claims as they pertain  to KPPI's findings, the conduct of KPPI's investigation and Indonesia's 
decision to i mpose the specific duty. However, in the light of our conclusion  that the specific duty 
is not a safeguard measure , we do not go on to consider the legal merits of those claims.34  
                                                
29 Appellate Body Repor t, US – Gasoline , pp. 16-18. 
30 Appellate Body Report, US – Wool Shirts and Blouses , p. 16. 
31 Appellate Body Report, EC – Hormones , para.  104. 
32 Appellate Body Report, US – Wool Shirts and Blouses , p. 14. 
33 We note, in particular, that our duty under Articl e 11 of the DSU includes the obligation to make an 
objective assessment of the applicability of the covered agreements invoked in this dispute. Indeed, "the 
'fundamental structure and logic' of a covered agreement may require panels to determine whether a measure 
falls within the scope of a particular provision or covered agreement before proceeding to assess the 
consistency of the measure with the substantive obligations imposed under that provision or covered 
agreement" . (Appellate Body Report, China – Auto Parts , para. 139 ). See, further, e.g. Panel Report s, 
Dominican Republic – Safeguard Measures , para. 7.58; and US – Gambling , para. 6.250; and Appellate Body 
Reports, US – Shrimp , para. 119; and Canada – Autos , para. 151.  
34 See further below, paras. 7.45-7.47. WT/DS490/R • WT/DS496/R  
 
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  7.3  Whether the specific duty  on imports of galvalume constitute s a "safeguard 
measure" within the meaning of Article 1 of the Agreement on Safeguards  
7.3.1   Definition of a safeguard measure  
7.12.   Article 1 of the Agreement on Safeguards specifies that "safeguard measures" "shall be 
understood to mean those measures provided for in Article XIX o f GATT 1994". The text of 
Article  XIX:1(a), which is the relevant subparagraph of Article XIX in this context, reads as follows:  
If, as a result of unforeseen developments and of the effect of the obligations incurred  
by a contracting party under this Agre ement, including tariff concessions, any product 
is being imported into the territory of that contracting party in such increased 
quantities and under such conditions as to cause or threaten serious injury to 
domestic producers in that territory of like or  directly competitive products, the 
contracting party shall be free, in respect of such product, and to the extent and for 
such time as may be necessary to prevent or remedy such injury, to suspend the 
obligation in whole or in part or to withdraw or modif y the concession .35 
7.13.   It is apparent from this language that the "measures provided for" in Article XIX:1(a) are 
measures that suspend  a GATT obligation  and/or withdraw or modify a GATT concession , in 
situations where, as a result of a Member's WTO commitment s and developments that were 
"unforeseen" at the time that it undertook those commitments, a product "is being imported" into 
a Member's territory in "such increased quantities and under such conditions as to cause or 
threaten serious injury to domestic pr oducers of like or directly competitive products".36 The text 
of Article  XIX:1(a) also makes clear that such measures must result in the suspension, withdrawal , 
or modification of a GATT obligation or concession for a particular purpose – that is, they must  
operate " to the extent and for such a time  as may be necessary to prevent or remedy such injury ".  
7.14.   Thus, not any measure suspending, withdrawing or modifying a GATT obligation or 
concession will fall within the scope of Article XIX:1(a). Rather, it is onl y measures suspending, 
withdrawing , or modifying a GATT obligation or concession that a Member finds it must be 
temporarily released from in order to pursue a course of action necessary to prevent or remedy 
serious injury that will constitute "safeguard me asures". For example, where all of the conditions 
for the imposition of a "safeguard measure" have been satisfied, a Member may choose to suspend 
its obligations under Article XI of the GATT 1994 for a period of time and restrict the volume of 
imports to a  level that prevents or remedies serious injury to its domestic industry in a way that 
would otherwise be inconsistent with the prohibition on the application of quantitative restrictions 
in that Article. The suspension of the imposing Member's obligations  under Article XI in this 
manner would allow it to "re -adjust temporarily the balance in the level of concessions between 
that Member and other exporting Members"37 to prevent or remedy serious injury.  In the absence 
of an obligation  preventing a Member's r emedial action , there would be obviously no need for that 
Member to be released from a WTO commitment and, therefore, nothing to  "re-adjust 
temporarily ".  
7.15.   It follows, therefore, that one of the defining features of the "measures provided for" in 
Article XI X:1(a) (i.e. safeguard measures) is the suspension, withdrawal , or modification of a GATT 
obligation or concession  that precludes a Member from imposing a measure to the extent 
necessary to prevent or remedy serious injury , in a situation where all of the conditions for the 
imposition of a safeguard measure are satisfied.   
7.16.   We note that certain findings of the panel in Dominican Republic – Safeguard Measures  
suggest that the "measures provided for" in Article XIX:1(a) may be defined by an additional 
characte ristic. In particular, the panel in that dispute found that the words "obligation" and 
"concession" in the last part of Article XIX:1(a) refer to the "obligations" and "concessions" in the 
first part of Article XIX:1(a)38, implying that Article XIX:1(a) con templates the suspension of a 
                                                
35 Emphasis added.  
36 Appellate Body Reports, Argentina – Footwear  (EC), paras. 93  and 94; and Korea – Dairy, 
paras.  86 and 87. 
37 Appellate Body Reports, Argenti na – Footwear  (EC), para. 94; and Korea – Dairy , para. 87.  
38 Panel Report, Dominican Republic – Safeguard Measures , para. 7.64.  WT/DS490/ R • WT/DS496/R  
 
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  GATT obligation or concession the effect of which has in some way resulted in the increased 
imports causing or threatening to cause serious injury. The complainants agree with this 
implication, stating that "under Article XIX: 1(a), a WTO Member may suspend a GATT obligation, 
provided that it has demonstrated that the effect of this obligation resulted in an increase in 
imports that caused or threatened to cause serious injury to its domestic industry".39 Indonesia, 
however, argu es that the GATT obligation an importing Member chooses to suspend "might not" 
always have to be the same obligation that results in increased imports.40  
7.17.   We do not believe it is necessary for us to make a finding on this interpretative issue in 
order to re solve this dispute. We are satisfied that our analysis of the merits of the 
parties'  arguments can proceed on the basis of the understanding of the term "safeguard 
measures" we have set out above – that is, that one of the defining features of a safeguard 
measure is the suspension, withdrawal , or modification of a GATT obligation or concession that 
precludes a Member from imposing a measure to the extent necessary to prevent or remedy 
serious injury , in a situation where all of the conditions for the imposi tion of a safeguard measure 
are satisfied .  
7.3.2   The specific dut y at issue do es not suspend, withdraw , or modify a relevant GATT 
obligation for the purpose of remedying or preventing serious injury  
7.3.2.1   No binding WTO tariff obligation with respect to imports of ga lvalume  
7.18.   As described above41, Indonesia has no binding tariff obligation with respect to galvalume in 
its WTO Schedule of Concessions. This means that, as far as its oblig ations under Article  II of 
GATT  1994 are concerned, Indonesia is free to impose any am ount of duty it deems appropriate 
on imports of galvalum e, including the specific duty  applied thro ugh the operation of 
Regulation  No. 137.1/PMK.011/2014. Indonesia recognizes this fact, noting repeatedly that the 
absence of a binding tariff obligation mea ns that Indonesia is "free to impose, increase, [or] 
reduce any tariff towards the product concerned at any time for any period of time".42 Indeed, 
after the imposition of the specific duty  at issue, Indonesia unilaterally raised the MFN ad valorem  
duty rat e on imports of galvalume from 12.5% to 20%.43 Thus, Indonesia's obligations under 
Article II of the GATT 1994 did not preclude the ap plication of the specific duty  on imports of 
galvalume, implying that the specific duty did not suspend, withdraw , or modif y Indonesia's 
obligations under Article II of the GATT 1994.  
7.19.   Following the second substantive meeting, Indonesia asserted that tariff obligations it 
incurred under the ASEAN -Korea (10%) and the ASEAN Trade in Goods (0%) RTAs prevented it 
from "increase [ing] its tariff" on imports of galvalume.44 According to Indonesia, "the application of 
the preferential tariffs under Indonesia FTAs pursuant to Article XXIV of the GATT 1994 results in 
Indonesia's inability to counter [the] increased imports".45 Thus, Indones ia argues that the 
imposition of the specific duty  on imports of galvalume originating in countries including its RTA 
partners  means that the "GATT obligation being suspended … is t he GATT exception under 
Article  XXIV of the GATT 1994".46  
                                                
39 Complainants' response  to Panel question  No. 48, para. 1.7 . 
40 Indonesia's response  to Panel question  Nos. 47 and 48.  
41 See abo ve, para.  2.3. 
42 Indonesia's comments on paragraphs 40  and 41 of Indonesia's second written  submission, para. 7; 
closing statement at the second meeting  of the Panel , para. 2.  
43 Regulation of the Minister of Finance of the Repu blic of Indonesia No. 97/PMK.010/2015 
(25 May 2015), (Exhibit TPKM/VNM -40). We recall that the specific dut y that is at issue in this dispute is 
applied in addition to the existing MFN and preferential duty rates on imports of galvalume . (See above, 
para. 2.3). 
44 Indonesia's response  to Panel question No. 48, para. 18 . 
45 Indonesia's general comments on complainants' responses  to Panel question s following the 
second  meeting  with the Panel , para. 8.  
46 Indonesia's general comments on complainants' responses  to Panel question s following the 
second  meeting  with the Panel , para. 10.  WT/DS490/R • WT/DS496/R  
 
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  7.20.   We are of the vie w that Article XXIV of the GATT 1994 does not impose an obligation on 
Indonesia to apply a particular duty rate on imports of galvalume from its RTA partners.47 
Article  XXIV of the GATT 1994 is a permissive  provision, allowing Members to depart from their 
obligations under the GATT to establish a customs union and/or free trade area, in accordance with 
specified procedures.48 Article XXIV does not impose any positive obligation on Indonesia either to 
enter into free trade agreements (FTAs) or to provide a cer tain level of market access to its FTA 
partners through bound tariffs. Indonesia's obligation to impose a tariff of 0% on imports of 
galvalume from its ASEAN trading partners is established in the ASEAN Trade in Goods Agreement, 
not in Article  XXIV. Simila rly, the establishment of a maximum tariff of 10% on imports of 
galvalume from Korea is found in the ASEAN -Korea Free Trade Agreement, not in Article XXIV.49 In 
other word s, Indonesia's 0% and 10% tariff commitments are obligations assumed under the 
respect ive FTAs, not the WTO Agreement.  There is, therefore, no basis for Indonesia's assertion 
that Article XXIV of the GATT 1994 precluded its authorities from raising tariffs on imports of 
galvalume and that the specific dut y, thereby, "suspended" "t he GATT ex ception under 
Article  XXIV" for the purpose of Article XIX:1(a).  
7.3.2.2   No other relevant GATT obligations preclude the adoption of the specific dut y 
7.21.   Indonesia argues that the imposition of the specific dut y also suspended its obligations 
under Article I:1 of the  GATT 1994. In particular, Indonesia submits that the specific dut y at issue 
suspended Indonesia's obligation to provide MFN -treatment under Article I:1 of the GATT 1994 
because it is applied on a discriminatory basis (i.e. to all but the 120  countries lis ted in 
Regulation  137.1/PMK.011/2014) in order to comply with the special and differential treatment 
(S&D) requirements of Article 9.1 of the Agreement on Safeguards.50 
7.22.   We note, h owever, that Indonesia does not argue that the specific dut y suspended its MFN  
obligations under Article I:1 because the S&D afforded in order to comply with Article 9.1 was 
necessary to remedy or prevent serious injury . Indeed, Indonesia acknowledges that the exclusion 
of imports from qualifying developing country Members pursuant to Article 9.1 is neither intended 
nor designed for this purpose.51 Rather, according to Indonesia, the exclusion of imports from 
developing country Members pursuant to Article 9.1 suspends Indonesia's MFN obligations under 
Article I:1 because such discrimi nation is a  legal "prerequisite "52 to the imposition of the specific 
duty, which is itself intended to prevent or remedy serious injury.53 In other words, Indonesia  
argues that the specific duty  imposed on imports of galvalume suspended its MFN obligations 
under Article I:1 of the GATT 1994 because the MFN principle would otherwise prohibit the 
discriminatory application of that duty  in the way that is legally required  under Article 9.1 of the 
Agreement on Safeguards.  
7.23.   Although the complainants contest Indones ia's assertions regarding the consistency of the 
exclusion of 120 countries from the application of the specific dut y with Article 9.154, the 
complainants share Indonesia's view that the specific dut y suspend s Indonesia's MFN obligations 
under Article I:1 o f the GATT  1994. In particular, the complainant s argue that the specific duty  
suspend s those obligations because it is applied "on a selective basis, excluding imports from 
                                                
47 The complainants also take this view. (Complainants' comments on Indonesia's response  to Panel 
question  Nos. 47 and 48 ). 
48 Appellate Body  Report, Turkey – Textiles , para. 45.   
49 Complainants' comments on Indonesia's response  to Panel question No. 48, para. 1.16 . 
50 Indonesia's first written submission, para. 212; comments on paragraphs 40  and 41 of Indonesia's  
second written  submission, para . 8; and general comments on complainants' responses  to Panel question s 
following the second meeting with the Panel , para. 7.  
51 Indonesia's response  to Panel question  Nos. 51 and 52; general comments on 
complainants'  responses  to Panel question s following the second meeting  with the Panel , para. 10; and 
comments on complainants' response  to Panel question  Nos. 50 and 51.  
52 Indonesia's general comments on complainants' responses  to Panel question s following the 
second  meeting  with the Panel , para. 24.  
53 Indonesia's response  to Panel question  Nos. 51 and 52.  
54 The complainants claim that six allegedly developed  country Members of the WTO (Bulgaria, Croatia, 
Hungary, Lithuania, Poland,  and Romania) were included in the list of 120 countries excluded from the 
application of the specific dut y. (Complainants' second written  submission, paras. 2.132 -2.137; opening 
statement at the second meeting  of the Panel , paras. 7.1 -7.5). WT/DS490/ R • WT/DS496/R  
 
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  certain countries (including developing and developed countries)"55 "with a view to address [ing] 
the threat of serious injury 'suffered' by the domestic industry" .56 Thus, the complainants m aintain 
that the specific duty  suspend s Indonesia's MFN obligation because it is applied on a discriminatory 
basis (whether consistently or inconsisten tly with Article 9.1) and is intended to remedy the threat 
of serious injury found to exist in the underlying investigation.57 
7.24.   We do not agree with the parties. In our view, the parties' arguments are based on a 
misconceived understanding of Article 9.1 and  its relationship with Article XIX:1(a). Article 9.1 
reads as follows:  
Developing Country Members  
1. Safeguard measures shall not be applied against a product originating in a 
developing country Member as long as its share of imports of the product concern ed in 
the importing Member does not exceed 3  per cent, provided that developing country 
Members with less than 3  per cent import share collectively account for not more than 
9 per cent of total imports of the product concerned. [*] 
[*fn original]2 A Member shall immediately notify an action taken under paragraph 1 of Article 9 
to the Committee on Safeguards.  
7.25.   Article 9.1 imposes an obligation on an importing Member to exclude imports of developing 
country Members from the scope of application of a safeguard measure in order to provide S&D, 
provided that certain conditions are satisfied.58 Thus, by its express terms, Article 9.1 is legally 
premised on an importing Member's intention to apply a safeguard measure.   
7.26.   We recall that we hav e found that the specific d uty on galvalume imports do es not suspend 
Indonesia's obligations under Article II of the GATT  1994. We have also rejected Indonesia's 
contention that the specific duty  should be considered to have "suspended" "the GATT exception 
under Article XXIV" for th e purpose of Article XIX:1(a) . The consequence of these find ings is that 
the specific duty  does not constitute a "safeguard measure" within the meaning of Article 1 of the 
Agreement on Safeguards. Thus, the fundamental prerequisite for the application of A rticle 9.1 
does not exist, and there is, therefore, no basis for Indonesia's assertion that it was legally 
required  to apply the specific duty  in the manner required by Article 9.1.  
7.27.   In any case, even where a Member is proposing to apply a safeguard measure59, it does 
not, in our view,  follow from the fact that Article 9.1 imposes an obligation  to apply a safeguard 
measure in a discriminatory manner in favour of qualifying imports from developing country 
Members, that the very same safeguard measure, because of that discrimination , suspends the 
obligation in Article I:1 to provide MFN -treatment for the p urpose of Article XIX:1(a). 
Two considerations lead us to this conclusion.  
7.28.   First, the discrimination that is called for by Article 9.1 (which would otherwise be 
inconsistent with Article I:1 of the GATT  1994) is not intended to prevent or remedy serious injury. 
Rather, that discrimination is intended to leave producers from qualifying developing country 
Members with essentially the same access to the importing country market as existed prior to the 
imposition of a safeguard measure. We fail to see how a course of action that dilutes  the protective 
impact of a safeguard measure in order to provide S&D  could result in the suspension of a 
Member's MFN obligations u nder Article I:1 for the purpose of Article XIX:1(a), given that the 
                                                
55 Complainants' comments on paragraphs 40  and 41 of In donesia's second written  submission, 
para. 1.6. 
56 Complainants' comments on paragraphs 40  and 41 of Indonesia's second written  submission, 
para. 1.7. 
57 Complainants' comments on paragraphs 40  and 41 of Indonesia's second written  submission, 
paras.  1.5-1.7; response  to Panel question  Nos. 49, 51, and 52.  
58 Panel Report, US – Line Pipe , para. 7.175; and Appellate Body Report, US – Line Pipe , para. 129.  
59 We recall here, to avoid confusion, that we have already found that the specific duty does not  
constitute a safeguard measure falling within th e scope of the obligation in Article 9.1.   WT/DS490/R • WT/DS496/R  
 
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  fundamental objective of Article XIX:1(a) is to allow Members to "escape" their GATT obligations to 
the extent necessary to prevent or remedy serious injury to a domestic industry .60  
7.29.   Secondly, we recall that the General Interpretative Note to Annex 1A of the WTO Agreement 
states that in the event of a conflict between a provision of the GATT 1994 and a provision of 
another covered agreement, the provision of the covered agreement shall pre vail to the extent of 
the conflict. In our view, the effect of this rule is that the discriminatory application of a safeguard 
measure that is required by Article 9.1, to the extent it is inconsistent with the principle of 
MFN-treatment, is permissible without having to suspend the opera tion of Article I:1 of the 
GATT  1994. Indeed, the question of suspension simply does not arise in this context, because the 
obligation in Article 9.1 to exclude the qualifying imports of developing country Members from the 
scope of a safeguard measure prevails as a matter of law  over the MFN obligation in Article  I:1. 
There is, therefore, no legal basis for the assertion that the discriminatory application of a 
safeguard measure in accordance with Article 9.1 constitutes a su spension of Article I:1, within the 
meaning of Article XIX:1(a). The authority to exclude qualifying imports of developing country 
Members from the scope of application of a safeguard mea sure in accordance with Article  9.1 
derives from the fact that the ob ligation to afford S&D in this manner under the Agreement on 
Safeguards prevails over the obligation to afford MFN -treatment under Article I:1 of the 
GATT  1994. It does not derive from Article XIX:1(a).  
7.30.   We recognize that our views in this re spect depart fr om certain statements and findings of 
the panel in Dominican Republic – Safeguard Measures . In that dispute, the panel found that the 
discriminatory application of a safeguard measure in accordance with Article 9.1 of the Agreement 
on Safeguards resulted i n the suspension of the importing Member' s MFN obligations under 
Article  I:1 of the GATT  1994.61 The parties in the present dispute have relied upon these findings 
to support their respective positions.62 We have carefully considered the panel's findings and , to 
the extent those findings would suggest a different outcome in this case, we respectfully disagree. 
In our view, and for the reasons explained in the preceding paragraphs63, the discriminatory 
application of a safeguard measure for the purpose of affor ding S&D pursuant to Article 9.1 does 
not result in a suspension of a Member's obligations under Article I:1 , within the meaning of 
Article  XIX:1(a) of the GATT 1994 . 
7.31.   We would come to the same overall conclusion even if we were to find, as the complainants  
request, that Indonesia included in the list of countries excluded from the application of the 
specific dut y six developed  country Members not entitled to S&D treatment under the terms of 
Article 9.1.64 While the exclusion of imports of developed  country M embers from the application of 
a safeguard measure  would be inconsistent with Article 9.1, it is clear from the findings we have 
made above that the specific duty  is not a "safeguard measure" with respect to which Indonesia 
                                                
60 In articulating this view, we express no opinion on the extent to which Article XIX:1(a) may or may 
not authorize an importing Member to apply a measure on a discriminatory basis (that would otherwise be 
inconsi stent with Article I:1 of the GATT 1994), were such discrimination considered by an importing Member 
to be necessary to prevent or remedy serious injury . Our views  are strictly limited to the discriminatory 
application of a safeguard measure that may resul t from compliance with Article 9.1, which is explicitly 
intended to afford S&D to qualifying developing country Members.  
61 Panel Report, Dominican Republic – Safeguard Measures , paras. 7.70 -7.73. We note that the facts in 
Dominican Republic – Safeguard Mea sures  were different to the present controversy in several important 
respects, including because the measures at issue in that proceeding were found to suspend the obligations of 
the Dominican Republic under not only Article I:1 of the GATT 1994, but also Article II :1(b) of the GATT 1994 . 
Thus, unlike the present dispute, the panel in Dominican Republic – Safeguard Measures  was not called upon 
to determine whether compliance with Article 9.1 could be the sole basis to find that a particular measure (that 
did not already meet the definition of a "safeguard measure" on a separate and independent basis) could be 
characterized as such, simply because of the discrimination that results from the provision of S&D.   
62 Indonesia's first written submission, paras. 209  and 210; Indonesia's comments on paragraphs 40  
and 41 of Indonesia's second written  submission, para. 8; complainants' second written  submission, 
para. 2.132;  and complainants' opening statement at the second meeting  of the panel , para. 7.2.  
63 See above, paras. 7.27-7.29. As explained in paragraph 7.27, this part of our analysis is premised on 
the existence of a safeguard measure falling within the scope of Article 9.1. We recall, however, that we have 
already found that the specific duty does not  constitute a safeguard measure, and that Indonesia was, 
therefore, under no obligation to comply with the S&D requirements of Article 9.1 in its application of the 
specific duty . (See above, paras. 7.24-7.26). 
64 We emphasize that we make no finding on the merits of the complainants' assertions concerning the 
alleged developed country status of the six countries at issue, n amely, Bulgaria, Croatia, Hungary, Lithuania, 
Poland,  and Romania.  WT/DS490/ R • WT/DS496/R  
 
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  had an obligation to comply with  Article 9.1. Thus, the discriminatory ap plication of the specific 
duty resulted from Indonesia's erroneous view that it was legally required to comply with 
Article  9.1. In other words, Indonesia excluded imports of the six countries at issue from the 
application of the specific duty  because it was of the view that they were developing country 
Members  that qualified for S&D.65  
7.32.   It follows that the conduct the complainants maintain would otherwise be precluded by 
Article I:1 (and, therefore, result in the sus pension of Indonesia's MFN obligations for the purpose 
of Article XIX:1(a)) was not undertaken for the purpose of preventing or remedying serious injury. 
Indonesia did not dec ide to apply the specific duty  to a limited number of exporting countries 
because  Indonesia considered it was necessary to discriminate between sources of imports of 
galvalume in order to prevent or remedy serious injury to its domestic industry. Rather, the 
discrimination resulting from the exclusion of the six countries was pursued f or the sole purpose of 
providing them with continued access to the Indonesian galvalume market une ncumbered by the 
specific duty , as a consequence of Indonesia's erroneous view that it was required to comply with 
Article 9.1 . Again, we cannot see how the application of the specific duty to imports originating in 
all but six countries , specifically excluded in order to maintain a pre -existing level of market access 
for the  purpose of affording those countries with  S&D, falls within the scope of the types of actions 
that may be authorized under Article XIX:1(a). Thus, even assuming, arguendo , that Indonesia 
did, in fact, exclude six developed  country Members from the ap plication of the specific duty, the 
resulting discrimination  does not mean that the specific  duty should be properly characterized as a 
"safeguard measure" within the meaning of Article 1 of the Agreement on Safeguards.  
7.3.3   Consequences of the fact that the specific dut y was adopted following an 
investigation conducted by Indonesia's competent autho rity pursuant to Indonesia's 
safeguards legislation with a view to complying with the Agreement on Safeguards  
7.33.   The specific duty  that is the subject of this dispute was imposed at the conclusion of an 
investigation initiated by Indonesia's competent authori ty in charge of the imposition of safeguard 
measures, and conducted pursuant to Indonesia's domestic safeguards legislation. The wording of 
the legal instrument adopting the specific duty, Regulation 137.1/PMK.011/2014 , describes the 
measure as a "safeguar d duty". Indonesia notified the investigation and its findings to the 
Committee on Safeguards pursuant to Articles  12.1(a), (b) , and (c) of the Agreement on 
Safeguards. According to the complainants, these facts , when considered in the context of their 
submission that the specific duty suspends Indonesia's obligation s under Article I:1 of the 
GATT  199466, all point in the direction of a finding that the specific duty  is a "safeguard measure" 
within the meaning of Article 1 of the Agreement on Safeguards.67 
7.34.   As we see it, the fact that a Member initiated and conducted an investigation under its 
domestic safeguards legislation does not necessarily mean that  the measures imposed on the 
investigated product at the end of that process are "safeguard measures" within  the meaning of 
Article XIX of the GATT 1994 and the Agreement on Safeguards. Although it would normally  be 
expected that a measure adopted to prevent or remedy serious injury at the conclusion of a 
safeguard investigation would be a "safeguard measure", particularly where the domestic 
implementing instrument described the adopted measure as a "safeguard measure", this would not 
be because of the existence of an underlying investigation  under the Member's domestic 
safeguards legislation, or the description of the measure by the imposing  Member  as a safeguard 
measure . Rather, it would be because of the expectation that the relevant measure is one of the 
"measures provided for" in Article XIX:1(a) of the GATT 1994, which as discussed above, is a 
                                                
65 Final Disclosure Report , (Exhibit IDN -8), para. 66; Regulation of the Minister of Finance of the 
Republic of Indonesia No. 137.1/PMK.011/2014 on imposition of safeguarding duty against th e import of 
flat-rolled products of iron or non -alloy steel (22 July 2014) , (Exhibit IDN -20), p. 4 and the appendix ; and 
Committee on Safeguards, Notification Under Articles 9, 12.1(b), and 12.1(c), and Footnote 2 of the 
Agreement on Safeguards (28 July 20 14), G/SG/N/8/IDN/16/Suppl.1, G/SG/N/10/IDN/16/Suppl.1, 
G/SG/N/11/IDN/14, (Exhibit TPKM/VNM -5). 
66 We recall that we have previously dismissed the complainants' submission. (See above, 
paras.  7.23-7.32 
67 Complainants' comments on paragraphs 40  and 41 of I ndonesia's second written  submission, 
paras.  1.7 and 1.8; response  to Panel question No. 49. Although appearing to initially share the 
complainants'  view, Indonesia ultimately disagrees with the compl ainants on this point. (Indonesia's comments 
on complainants' response  to Panel question  Nos. 50 and 51, paras . 22 and 23 ). WT/DS490/R • WT/DS496/R  
 
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  measure that s uspends, withdraws , or modifies a GATT obligation or concession that precludes a 
Member from imposing a measure to the extent necessary to prevent or remedy serious injury , in 
a situation where all of the conditions for the imposition of a safeguard measur e are satisfied .  
7.35.   An importing Member that undertakes an investigation to determine whether to impose a 
safeguard measure on imports of a particular product will not know at the beginning of its 
investigation, whether or the extent to which, it may need to  suspend, withdraw , or modify a GATT 
obligation or concession in order to address the serious injury that is allegedly caused by increased 
imports. It is clear, however, that as long as the potential  to respond to alleged serious injury to 
the domestic ind ustry through the imposition of a "safeguard measure" exists, the importing 
Member would have to initiate and conduct an investigation in accordance with the Agreement on 
Safeguards, as a WTO -consistent safeguard investigation is a necessary prerequisite t o the 
imposition of a WTO -consistent safeguard measure.  
7.36.   Thus, an importing Member may initiate a safeguard investigation and find, at the end of 
that process, that the conditions for imposition of a safeguard measure are satisfied. At that point, 
the impor ting Member will have to determine whether it will impose a measure, and if so, what 
form and level that measure should take. The i mporting Member will have 
three  choices:  (a) impose a measure suspending, withdrawing , or modifying a GATT obligation or 
concession to the extent necessary to prevent or remedy the serious injury established in the 
underlying investigation and facilitate adjustment (that is, impose a safeguard measure ); (b) take 
some other WTO -consistent action to otherwise address the serious i njury established in the 
underlying investigation; or ( c) take no action and impose no measure at all, despite having 
established the right to do so.  
7.37.   It is to be expected that an importing Member, having established that the conditions to 
impose a safeguar d measure exist, will typically exercise its right to impose a safeguard measure. 
However, an importing Member in that situation might also decide, in the light of the findings 
made in the underlying investigation and/or other considerations68, not to suspe nd, withdraw , or 
modify a GATT obligation in order to pr event or remedy serious injury.  
7.38.   In this connection, we note that Indonesia explained its decisi on to impose the specific duty  
by resorting to  a process that involved conducting an investigation  under its safeguards legislation , 
as follows:  
Although Indonesia fully understands that it has the right to modify the applied tariff 
unilaterally, however, Indonesia is of the view that rationalization and proper 
procedures to increase or reduce tariffs to cert ain products are necessary as the basis 
of government policy. This is why Indonesia opted for the safeguard proceeding.69 
We understand this explanation to mean that Indonesia decided to conduct an investigation under 
its safeguards legislation and the Agre ement on Safeguards not because Indonesia considered it 
was legally bound by its international obligations to do so in or der to apply the specific duty  on 
imports of galvalume, but because of other reasons related to "government policy". Recalling that 
one of the defining features of a safeguard measure is the suspension, withdrawal , or modification 
of a GATT obligation or concession  that precludes a Member from imposing a measure  to the 
extent necessary to prevent or remedy serious injury, and in the light  of our previous finding that 
the specific duty does not possess this important characteristic, Indonesia's statement is, in our 
view, clear recognition that the specific dut y challenged in this dispute do es not constitute a 
safeguard measure  within the me aning of Article 1 of the Agreement on Safeguards, 
notwithstanding the fact that it was imposed following an investigation conducted under 
Indonesia's safeguard legislation with a view to complying with the Agreement on Safeguards  and 
described as a safegu ard measure in the implementing regulation . 
7.39.   It follows from the above that while a WTO -consistent investigation is a necessary 
prerequisite for the application of a WTO -consistent safeguard measure, the fact that an importing 
Member may have conducted an i nvestigation in accordance with the Agreement on Safeguards 
                                                
68 For instance, considerations of public interest, which are mentioned in Article 3(1) of the Agreement 
on Safeguards, may lead a Me mber to decide not to impose a safeguard measure, despite having established 
the right to do so.  
69 Indonesia's comments on paragraphs 40  and 41 of Indonesia's second written  submission, para. 7.  WT/DS490/ R • WT/DS496/R  
 
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  does not mean that any measures adopted as a result of the conclusions in that investigation 
suspend, modify, or withdraw any GATT obligation or concession and, therefore, constitute 
"safeguard me asures" within the meaning of Article 1 of the Agreement on Safeguards. Because a 
Member is free to choose not to apply a safeguard measure, even when all of the conditions for 
application are satisfied, the mere fact that it has undertaken a WTO -consisten t safeguard 
investigation and made all necessary notifications to the WTO Committee on Safeguards does not 
render that Member's consequent actions a "safeguard measure" for the purpose of WTO law.  
Ultimately, we do not understand the complainants to disagr ee with this proposition, as they have 
themselves explained that their position is not that the specific duty is a safeguard measure solely  
because it was described as such in the implementing regulation and adopted following a domestic 
safeguards investig ation that was notified to the WTO Committee on Safeguards. Rather, the 
complainants have made clear that they consider these facts to lend support to the view that the 
specific duty is a safeguard measure when considered in the light of their submission t hat 
Indonesia's discriminatory application of the specific duty, for the purpose of providing S&D in 
accordance with Article 9.1 of the Agreement on Safeguards, suspended Indonesia's obligations 
under Article I:1 of the GATT 199470, a submission, which we r ecall once again, we have rejected.  
7.3.4   Conclusion  
7.40.   In summary, we have found that one of the defining features of a safeguard measure is the 
suspension, withdrawal , or modification of a GATT obligation or concession  that precludes a 
Member from imposing a meas ure to the extent necessary to prevent or remedy serious injury , in 
a situation where all of the conditions for the imposition of a safeguard measure are satisfied71, 
and that the specific duty  applied by Indonesia on imports of galvalume do es not constitut e such a 
measure  for the following reasons : 
a. the specific d uty does not suspend, withdraw , or modify the operation of Indonesia's 
obligations under Article II of the GATT 1994 for the purpose of Article XIX:1(a)72;  
b. there is no basis for Indonesia to assert that Article XXIV of the GATT 1994 precluded its 
authorities from raising tariffs on imports of galvalume and that, for this reason, the 
specific duty  "suspended" "the GATT exception under Article XXIV" for the purpose of 
Article XIX:1(a)73;  
c. the discrimina tory ap plication of the specific duty  in order to afford S&D treatment to 
120 Members , which  Indonesia (rightly or wrongly) considered to be developing 
countries , does not suspend Indonesia's obligation to provide MFN -treatment under 
Article I:1 of the GAT T for the purpose of Article XIX:1(a)74; and  
d. the fact that the specific duty  was described as a safeguard measure in the 
implementing regulation and imposed following a n investigation conducted pursuant to 
Indonesia's domestic safeguards legislation, with a view to complying with the disciplines 
of the Agreement on Safeguards (including notification requirements), doe s not render 
the specific duty  a "safeguard measure" within the meaning of Article 1 of the 
Agreement on Safeguards.75  
7.41.   In coming to this concl usion, we wish to emphasize that contrary to what Indonesia 
suggests76, our fin ding that the specific duty  is not a "safeguard measure" does not mean that 
Members are precluded from applying "safeguard measures" on imports for which their tariffs are 
"unbou nd". Any WTO Member faced with such a situation would be entitled to exercise its rights 
under the Agreement on Safeguards to prevent or remedy serious injury to its domestic industry, 
provided that the chosen remedial course of action suspends, withdraws , or modifies a relevant 
GATT obligation or concession for that purpose. A Member whose tariff is "unbound" with respect 
to a product that is facing competition from imports that are allegedly causing  serious injury,  may, 
                                                
70 Complainants' request for interim review, paras. 2.11 and 2 .12. 
71 See above, paras. 7.12-7.17. 
72 See above, para. 7.18. 
73 See above, paras. 7.19 and 7.20. 
74 See above, pa ras. 7.21-7.32. 
75 See above, paras. 7.33-7.39. 
76 Indonesia's comments on paragraphs 40  and 41 of Indonesia's second written  submission, 
paras. 2, 6, and 9.  WT/DS490/R • WT/DS496/R  
 
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  for example, impose a safeguard mea sure in the form of an appropriate import quota, thereby 
suspending its obligations under Article XI of the GATT 1994. Of course, such a measure would 
have to be based on a WTO -consistent investigation and conclusions. However, the mere fact of 
having cond ucted such an investigation does not mean that an otherwise permitted action, such as 
an increase in an unbound tariff, becomes a safeguard measure subject to review under the 
Agreement on Safeguards. Indonesia in this case did not undertake any course of action that 
suspended, withdrew , or modified any GATT obligation or concession. Accordingly, for all of the 
above reasons, we find that the specific duty  applied by Indonesia on imports of galvalume 
pursuant to Regulation No. 137.1/PMK.011/2014 does not constitute a "safeguard measure", 
within the meaning of Article 1 of the Agreement on Safeguards.  
7.4  Whether the exclusion of 120 countries from the application of the specific dut y 
imposed pursuant to Regulation No. 137.1/PMK.011/2014  is inconsistent with 
Indo nesia's obligation to afford MFN -treatment under Article I:1 of the GATT  
7.42.   The complainants claim that the application of t he specific duty  on imports of galvalume 
originating in all but the 120 countries listed in Regulation No. 137.1/PMK.011/2014  is incons istent 
with Indonesia's obligations under Article I:1 of the GATT 1994. According to the complainants, the 
exclusion of galvalume originating in those 120 countries from the scope of the specific duty  is an 
advantage, favour, or privilege provided in conne ction with the application of customs duties that 
Indonesia failed to accord immediately and unconditionally to like products originating in all WTO 
Members.77 Although the complainants pursue this claim primarily as part of their complaint 
against the spec ific dut y as a safeguard measure78, they also make the same claim on the basis of 
the same arguments against the spec ific duty  as a stand -alone measure .79  
7.43.   Indonesia has not contested the complainants' Article I:1 c laim against the specific duty  as 
a stand -alone measure . Moreover, in responding to the complainants' Article I:1 claim  against the 
specific duty  as a safeguard measure , Indonesia's only response has been to argue that the 
discrimi natory application of the duty  is: (a) authorized by Article XIX:1(a ) of the GATT (to the 
extent that this provision entitles Indonesia to suspend its obligati ons under Article I:1); 
and (b) legally required under the terms of Article 9.1 of the Agreement on Safeguards (which 
prevails over Article I:1 to the extent of any conflict).80 Thus, Indonesia's sole justification for the 
exclusion of imports of galvalume originating in 120 countries from the ap plication of the specific 
duty is premised on t he view that the specific duty  is a measure which, by definition , would be 
inconsistent with Article I:1 of the GATT, were it not considered to be a safeguard measure within 
the meaning of Article 1 of the Agreement on Safeguards . We have previously co ncluded that the 
specific duty  does not constitute a safeguard measure.81 
7.44.   Article I :1 of the GATT requires that "any advantage, favour, privilege or immunity" granted 
by a Member in relation to the application of inter alia  "customs duties and charges" on the 
importation of "any product originating in … any other country shall be accorde d immediately and 
unconditionally to the like product originating in … the territories" of all Members. The 
complainants argue, and we  agree, that the specific duty  is a "customs duty " within the meaning 
of Article I:1. We also share the complainants' view  that the exclusion of imports of galvalume 
from the 120 countries listed in Regulation No. 137.1/PMK.011/2014  constitutes an "advantage" 
granted to "like products" that is not "immediately and unconditionally accorded" to imports of 
                                                
77 Complainants' first written submission, paras. 5.142 -5.150; Chinese Taipei's panel request, 
para. II.a.6, p. 3; and Viet Nam's panel request, para. 1.7.a.vi, p. 3.  
78 In particular, the complainants argue that Indonesia's application of th e specific duty, as a safeguard 
measure , is inconsistent with Article I:1 of the GATT because the exclusion of the 120 countries listed in 
Regulation No. 137.1/PMK.011/2014  cannot be justified by Article 9.1 of the Agreement on Safeguards due to 
the fact t hat six of those countries are European Union member States and, therefore, according to the 
complainants, not developing countries. (Complainants' first written submission, paras. 5.142 -5.150; response 
to Panel question No. 42 ; second written submission, paras. 2.128, 2.132, and 2.136; opening statement at 
the first meeting of the Panel, paras. 7.1 and 7.2; and opening statement at the second meeting of the Panel, 
para. 7.2). 
79 Complainants' comments on paragraphs 40 and 41 of Indo nesia's second written  submission, 
para. 2.2; response to Panel question No. 51.  
80 Indonesia's first written submission, paras. 210 -212; opening statement at the first meeting of the 
Panel, paras. 63 and 64; comments on paragraphs 40 and 41 of I ndonesia 's second written  submissio n, 
para. 8; and opening statement at the second meeting of the Panel, para. 72.  
81 See above, para. 7.40. WT/DS490/ R • WT/DS496/R  
 
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  galvalume from all WTO  Members. Accordingly, we find that the ap plication of the specific duty  on 
imports of galvalume originating in all but the 120 countries listed in 
Regulation  No. 137.1/PMK.011/2014  is inconsistent with Indonesia's obligat ion to afford 
MFN-treatment under Article I:1 of the GATT 1994.  
7.5  The complainants' claims under the Agreement on Safeguards and Articles  XIX:1(a) 
and XIX:2 of the GATT 1994  
7.45.   Indonesia submits that the consequence of a finding that the specific duty does not 
constitute a safeguard measure sh ould be the rejection of the entirety of the complainants' claims 
under the Agreement on Safeguards.82 The complainants do not refute this implication, but 
nevertheless ask that the merits of their claims under the Agreement on Safeguards be fully 
resolved in order to "secure a positive solution" to this dispute.83  
7.46.   Having concluded that the specific duty is not a safeguard measure within the meaning of 
Article  1 of the Agreement on Safeguards, it is evident to us that there is no legal basis for the 
complain ants' claims under the Agreement on Safeguards (as well as Articles  XIX:1(a) and XIX:2 
of the GATT 1994). Accordingly, we dismiss the entirety of those claims. In our view, the findings 
and conclusions we have made in the preceding section of this report a re an appropriate and 
sufficient basis to resolve the matters at issue in this dispute consistent with our terms of 
reference and Article  11 of the DSU. In this light, we see no need to make any alternative findings 
on the legal merits of the complainants'  claims under the Agreement on Safeguards and 
Articles  XIX:1(a) and XIX:2 of the GATT 1994.  
7.47.   Nevertheless, in the light of the unique circumstances of this case84, we have decided to 
proceed to address the complainants' claims, but only to the extent of iden tifying facts relevant to 
an evaluation of the allegations pertaining to KPPI's findings, the conduct of its investigation , and 
Indonesia's decision to impose the specific duty. Given our conclusions above, we do not go on to 
consider the legal merits of t he complainants' claims.  Thus, in the sub -sections that follow, and f or 
each of the sets of issues raised by the complainants85, we firstly describe the parties' arguments 
and summarize the relevant applicable law (without making any findings on questions o f legal 
interpretation arising from those arguments), before turning to identify the relevant facts.  
7.5.1   Unforeseen developments and the effect of GATT 1994 obligations  
7.5.1.1   Parties' arguments  
7.48.   The complainants claim that KPPI's determination is inconsistent with Article XIX:1(a) of the 
GATT 1994 and Article  3.1 of the Agreement on Safeguards because KPPI erroneously concluded 
that the "surge of imports" qualified as an unforeseen development and because, in any case, KPPI 
failed to: (a) provide a reasoned and adequa te explanation of what the unforeseen developments 
were; (b) explain why those developments were unforeseen  at the relevant time; (c) identify  any 
GATT 1994 obligation whose effect(s) led to increased imports ; and (d) properly establish a logical 
                                                
82 Indonesia's second written submission, para. 41.  
83 Complainants' comments on paragraphs 40 and 41 of Indonesia's second  written  submission, 
para. 2.2 
84 We recall that: (a) Indonesia conducted the investigation at issue with a view to complying with its 
obligations under the Agreement on Safeguards and imposed the specific duty in the light of the outcome of 
that investigat ion, despite knowing that it was entitled to raise its applied MFN duty rate on imports of 
galvalume at any time and to any level, given that it has no tariff bindings on that product under Article II of 
the GATT 1994;  and (b) all three parties have consis tently argued from the very beginning of this proceeding 
that the specific duty is a safeguard measure. This is the first time that a WTO dispute settlement Panel has 
been called upon to rule upon the merits of claims of violation of the Agreement on Safeg uards in such a 
situation.  
85 Having found Indonesia's application of the specific duty, as a stand -alone measure , to be 
inconsistent with its obligations under Article I:1 of the GATT 1994 ( above paras. 7.42-7.44), we believe it is 
not necessary for the purpose of resolving this dispute to identify facts that might be relevant to the legal 
analysis of the complainants' alternative Article I:1 claim  (above para. 7.42).  WT/DS490/R • WT/DS496/R  
 
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  connectio n between the alleged unforeseen developments and the effect(s) of the GATT 1994 
obligation(s) and the increase in imports of galvalume .86 
7.49.   Indonesia denies the complainants' allegations, submitting that the standard KPPI had to 
satisfy in making its finding s is not as rigorous as the complainants claim, emphasizing that KPPI's 
conclusion on unforeseen developments must be considered in the light of the totality of KPPI's 
findings and that  the Panel should not be overly focused only on the conclusion. I n any case, 
according to Indonesia, the complainants understood that the unforeseen development was the 
2008 global financial crisis. Indonesia also argues that it follows from the simplicity of the facts at 
issue in the underlying investigation and Indonesia's developing country status that KPPI was not 
required to support its determination of unforeseen developments with sophisticated economic 
analys es in order to satisfy Indonesia's obligations .87 Furthermore, in responding to the 
complainants' claims concernin g the effect of a GATT 1994 obligation, Indonesia points to the MFN 
and preferential duty rates applied by Indonesia on imports of galvalume, which were identified in 
KPPI's Final Disclosure Report.88  
7.5.1.2   Relevant law  
7.50.   Article  XIX:1(a) of the GATT 1994  provides  as follows:  
If, as a result of unforeseen developments and of the effect of the obligations incurred 
by a contracting party under this Agreement, including tariff concessions, any product 
is being imported into the territory of that contracting party in s uch increased 
quantities and under such conditions as to cause or threaten serious injury to 
domestic producers in that territory of like or directly competitive products, the 
contracting party shall be free, in respect of such product, and to the extent a nd for 
such time as may be necessary to prevent or remedy such injury, to suspend the 
obligation in whole or in part or to withdraw or modify the concession . 
Both clauses of Article  XIX:1(a) must be satisfied before a Member may impose a safeguard 
measure.  The first clause sets out  two circumstances whose existence must be factually 
demonstrated before any safeguard may be applied: ( a) the existence of unforeseen 
developments; and ( b) the existence of one or several obligation(s) under the GATT 1994.89 
Demon stration of these two factual pre -requisites must be in the competent authority's published 
report.90 The second clause sets out the "independent conditions" that must also be established in 
order to impose a safeguard measure. These include an increase in imports in such quantities and 
under such conditions as to cause or threaten to cause serious injury to domestic producers of like 
or directly competitive products. A competent authority must demonstrate the existence of a 
"logical connection" between , on the one hand, the existence of unforeseen developments and the 
obligat ions assumed under the GATT 1994 and, on the other hand, the increase in imports of the 
subject product that is causing or threatening to cause serious injury to the domestic industry of  
the importing Member.91 It is not for a Panel to identify linkages that the competent authority 
failed to make in its published report.92 
 
7.51.   The expression "unforeseen developments" is understood to mean  developments that were 
"unexpected" at the time the imp orting Member incurred the relevant GATT obligation.93 A 
competent authority's published report must demonstrate how these developments were 
                                                
86 Complainants' first written submission, paras. 5.17 -5.30; opening statement at the first meeting of 
the Panel, paras. 2.1 -2.3; response to Panel question Nos. 1 -3; and second written  submission, 
paras.  2.4-2.28. 
87 Indonesia's first written submission, par as. 53 -65; response to Panel question Nos. 8 and 9;  and 
second written  submission, paras. 24 -39. 
88 Indonesia's response to Panel question No. 6, paras. 3 -6. 
89 Appellate Body Report s, Argentina – Footwear (EC) , para. 91; and Korea – Dairy , para. 84; and Panel 
Report, Ukraine – Passenger Cars , para. 7.57.  
90 Panel Report, Ukraine – Passenger Cars , para. 7.5 6. 
91 Appellate Body Report s, Argentina – Footwear (EC) , para. 92; Korea – Dairy , para. 85; US – Lamb , 
para. 72; and US – Steel Safeguard s, paras. 31 5-319; and Panel Report, Ukraine – Passenger Cars , 
paras.  7.83 and 7.96. 
92 Appellate Body Report , US – Steel Safeguards , para. 3 22. 
93 Appellate Body Report s, Argentina – Footwear (EC) , para. 93; and Korea – Dairy , para. 8 6. WT/DS490/ R • WT/DS496/R  
 
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  unexpected.94 A "mere phrase in a conclusion, without supporting analysis of the existence of 
unforeseen developments , is not a substitute for a demonstration of fact".95 Moreover, b ecause a 
competent authority must establish that the increase in  imports  is a result of  the unforeseen 
developments,  an increase in imports cannot,  by definition, constitute an unforeseen deve lopment  
within the meaning of Article  XIX:1(a) .96 
7.52.   The expression "the effect of the obligations incurred by a Member  under this Agreement" 
requires a  competent authority to factually demonstrate "that the importing Member has incurred 
obligations under the GATT 1994, including tariff concessions".97  
7.53.   Article  3.1 of the Agreement on Safeguards  provides in relevant part that : 
The competent authorities shall publish a report setting forth their findings and 
reasoned conclusions reached on all pertinent issues of  fact and law.  
To comply with  this obligation, a competent authority must , with respect to all pertinent issues of 
law and fact, set out in sufficient detail its findings and its reasoned conclusions in a published 
report.98 A competent authority's findings  and conclusions must be  expressed in a logical form or 
have resulted from a logical examination of a matter.99 The existence of unforeseen developments  
qualifies as a "pertinent issue of  fact and  law" for the purpose s of applying Article  3.1.100 
Therefore, Article 3.1 places an obligation on a Member's  competent authority to include in its 
published report a " 'reasoned conclusion ' on 'unforeseen developments '".101 
 
7.5.1.3   Relevant facts  
7.54.   KPPI's findings with respect to unforeseen developments are set out in three parag raphs of 
the Final Disclosure Report. KPPI concludes  that the "surge of imports"  of galvalume constitute s an 
"unforeseen development ", after describing  the alleged impact of the following two events on 
international trade in galvalume: (a) the 2008 global financial crisis ; and (b) a change in 
Indonesian raw material preferences from wood to light steel.102  
7.55.   The Final Disclosure Report states that the 2008 global financial crisis caused demand for 
imports of galvalume outside of Indonesia  to decrease , resultin g in a diversion of trade  from other 
import markets  to the Indonesian market because of above -global -average economic growth in 
Indonesia.103 It also states  that a change in domestic market preferences for raw materials (from 
wood to light steel) had the eff ect of increasing  Indonesian  demand for imports of galvalume "in 
line with the growth of roll forming industry" .104 On the basis of these considerations, KPPI 
concludes in the final paragraph of its analysis that the "surge of imports during the period of 
investigation … is considered as unforeseen development".105 
7.56.   Although there is no dispute between the parties about whether the 2008 global financial 
crisis actually took place, the 2008 global financial crisis is neither described in any detail nor 
explicitly  identified in the Final Disclosure Report as an unforeseen development. Rather, as 
already noted, KPPI stated that the "surge of imports" was the "unforeseen development". KPPI's 
findings in the relevant paragraphs of the Final Disclosure Report make no s pecific reference to 
any data, statistics, submissions , or underlying studies to support the various statements made 
about: (a) the alleged consequences of the 2008 global financial crisis on international trade in 
                                                
94 Appellate Body Report , US – Lamb , para s. 71 -73; and Panel Report, Chile – Price Band System , 
para. 7.134.  
95 Panel Report, Argentina – Preserved Peaches , para. 7.33.  
96 Panel Report, Ukraine – Passenger Cars , para. 7.83.  
97 Appellate Body Report s, Argentina – Footwear (EC) , para. 91 ; and  Korea – Dairy , para. 8 4. 
98 Appellate Body Report,  US – Steel Safeguards , para. 287.  
99 Appellate Body Report , US – Steel Safeguards , para. 287.  
100 Appellate Body Report s, US – Lamb , para. 76; and US – Steel Safeguards , paras. 290  and 326; and 
Panel Report , Chile – Price Band System , para. 7.137.  
101 Appellate Body Report , US – Lamb , para. 76.  
102 Final Disclosure Report, (Exhibit IDN -8), paras. 52 -54.  
103 Final Disclosure Report, (Exhibit IDN -8), para. 52.  
104 Final Disclosure Report, (Exhibit IDN -8), para. 53.  
105 Final Disc losure Report, (Exhibit IDN -8), para. 54.  WT/DS490/R • WT/DS496/R  
 
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  galvalume; (b) Indonesia's above -global -average economic growth; or (c)  the change in the raw 
materials preferences. To this extent, KPPI's finding of the existence of unforeseen developments 
rests on unsubstantiated assertions.  
7.57.   Turning to the identification of Indonesia's obligations under the G ATT 1994, we note that 
the MFN and preferential duty rates in force with respect to imports of galvalume during the period 
of investigation (POI) are set out in Table  3 of the Final Disclosure Report. The fact that Indonesia 
has no binding WTO tariff oblig ation with respect to galvalume is not mentioned. There is, 
furthermore, no record of any specific consideration of any of Indonesia's obligations under the 
GATT 1994 in the Final Disclosure Report.  
7.5.2   Increased  imports  
7.5.2.1   Parties' arguments  
7.58.    The complainants c laim that Indonesia acted inconsistently with its obligations under 
Article  XIX:1(a) of the GATT 1994 and Articles  2.1 and 3.1 of the Agreement on Safeguards by 
failing to make a proper determination of whether galvalume "is being imported" in such increas ed 
quantities as to cause or threaten to cause serious injury (KPPI's determination of "increased 
imports"), and by subsequently imposing the challenged safeguard measure on the basis of the 
same determination of "increased imports".106  
7.59.   The complainants sub mit that the facts and circumstances surrounding the challenged 
galvalume investigation demonstrate that Indonesia acted inconsistently with its obligations under 
these provisions for essentially two reasons. First, because  KPPI's finding of "increased imp orts" 
was based on import data from a POI that ended 15 months before its substantive determination, 
without any explanation as to why data from such an allegedly remote POI constituted  an 
appropriate basis to make that finding ; and secondly, because t he same finding of "increased 
imports" was relied upon to justify the imposition of the challenged safeguard measure 
approximately 1 9 months after the end of the POI, without any explanation as to why the data 
from such an allegedly remote POI constituted an appropriate basis for that decision.107 
7.60.   Indonesia submits that the Agreement on Safeguards does not set a "specific numerical 
threshold " for the time -gap between , on the one hand,  the end of a POI and , on the other hand,  
the dates on which a Member makes a substantive determination of increased imports in a 
safeguard investigation or decides to impose a safeguard  measure . Moreover, Indonesia points out 
that, unlike the Anti -Dumping Agreem ent and the Agreement on Subsidies  and Countervailing 
Measures, the Agree ment on Safeguards is silent about the maximum duration of a safeguard 
investigation, leaving Members with a degree of flexibility to decide  exactly when to apply a 
safeguard measure after the issuance of the results of a safeguards investigation.108  
7.61.   Indone sia also argues that the complainants' suggestion to take into account the data of the 
first half of 2013 would be contradictory to the goal of expediting the investigation because by 
taking into account new data, KPPI would have to update and verify not o nly its increased imports 
analysis, but also other relevant requirements. Therefore, Indonesia submits that the 
implementation of the complainants' suggestion would undoubtedly result in a longer, if not the 
same, time  required to complete the investigatio n. Moreover, Indonesia draws a parallel between 
the facts of the galvalume investigation and the facts at issue in Ukraine – Passenger Cars , where 
the panel found that a 16 -month time gap between the end of the POI and the date of the 
competent authority's  substantive determination was sufficient to establish that the increased 
imports were recent enough . In contrast, Indonesia asserts that the time-gap between the end of 
the POI and the date of the substantive determination in the galvalume investigation was only 
15 months, which Indonesia argues should be acceptable given the following circumstances: 
                                                
106 Complainants'  first written submission, paras. 5.35 -5.55. Separately, Viet Nam claims that as a 
consequence  of the alleged violations of Article XIX:1(a) of the GATT and Articles 2.1 and 3.1 of the Agreement 
on Safeguards, Indonesia also acted inconsistently with Articles 4.2(a) and 4.2(c) of the Agreement on 
Safeguards. (Complainants'  first written submission, para. 5.56 ). 
107 Complainants'  opening statement at the first meeting of the Panel, paras. 3.1 -3.6; second  written  
submission, paras. 2.33 -2.46; and opening statement at the second meeting of the Panel, paras. 3.1 -3.10. 
108 Indonesia's first written submission , para s. 86-88 and 92.  WT/DS490/ R • WT/DS496/R  
 
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  (a) Indonesia's status as a developing country; ( b) the fact that KPPI was in charge of 
ten safeguard investigations between 2013 and 2014; ( c) the fact that KPPI's chairperson and the 
Minister of Trade were replaced during the relevant period; (d) the fact that no interested party 
ever requested KPPI to update the import data; and (e) that, in any case, official import data for 
2013 only became available on 4 August 2014 .109 According to Indonesia, the delay between the 
date of KPPI's substantive determination and the date of the Indonesian Minister of Trade's 
decision to apply the safeguard measure can also be objectively justified by the various domestic 
proced ures that had to be followed before the decision to apply the safeguard measure could be 
adopted by the Minister of Trade.110  
7.62.   In the complainants' view, however, Indonesia relies erroneously on the panel's findings 
because the facts of that dispute are very  different from the facts in the present dispute. In 
particular, the complainants argue that, in Ukraine – Passenger Cars , the panel found that Japan 
had not put forward specific arguments to suggest that the investigation took longer than needed; 
and it a lso highlighted the fact that "the competent authorities were actively engaged [with Japan] 
right up to the end of the investigation", and "published a notice specifically on the extension of 
the investigation".111 In contrast, t he complainants argue that,  in the present dispute, "the time 
gaps at issue were 'abnormal' due to several bureaucratic factors that delayed the issuance of the 
Final Disclosure Report"; "KPPI had access to data on the volume of imports for, at least, the first 
half of 2013, which wer e ignored"; "Indonesia did not issue any notice as to the possible delay and 
extension of the investigation"; and Indonesia did not "engage actively with exporting countries in 
the course of the investigation".112  
7.5.2.2   Relevant law  
7.63.   Article  2.1 of the Agreement o n Safeguards provides that:  
A Member may apply a safeguard measure to a product only if that Member has 
determined, pursuant to the provisions set out below, that such product is being 
imported  into its territory in such increased quantities , absolute or r elative to domestic 
production, and under such conditions as to cause or threaten to cause serious injury 
to the domestic industry that produces like or directly competitive products .113 
The underlined text in Article  2.1 (and the parallel language that appe ars in Article  XIX:1(a) of the 
GATT 1994) has been interpreted to mean that the increase in imports observed in a 
determination giving rise to the right to apply a safeguard measure must be "recent enough, 
sudden enough, sharp enough, and significant enoug h, both quantitatively and qualitatively, to 
cause or threaten to cause 'serious injury'".114 Moreover, the phrase "is being imported", which is 
also found in both Article  XIX:1(a) and Article  2.1, conveys the need to select a POI "that is 
sufficiently recen t to provide a reasonable indication of current trends in imports".115 Thus, the 
consideration of an increase in imports that is the focus of a safeguards investigation must be 
based on data from a POI that ends in the very recent past and is sufficiently re presentative of 
current import movements.116 
7.64.   There are no absolute or abstract standards for determining whether a competent 
authority's analysis has complied with this requirement. An assessment must be made on a 
case-by-case basis , considering the relevant  facts and circumstances concerning, inter alia , the 
                                                
109 Indonesia's first written submission , para s. 90 and 93 -95; opening statement at  the first meeting of 
the Panel, paras. 29 and 30; second written  submission, paras. 44, 53, and 56 -59; opening statement at the 
second meeting of the Panel, paras. 31 -35, 37, and 38; response to Panel question No s. 57 and 59 ; and 
comments to complainants'  response to Panel question Nos. 60 and 61.  
110 Indonesia's first written submission , para . 99; opening statement at the first meeting of the Panel, 
para. 31; and response to Panel question No. 59.  
111 Complainants'  opening statement at the second meeting of t he Panel, para. 3.7 (citing Panel Report, 
Ukraine – Passenger Cars , para. 7.176).  
112 Complainants'  opening statement at the second meeting of the Panel, para. 3.8.  
113 Fn omitted; emphasis added.  
114 Appellate Body Report , Argentina – Footwear (EC) , para. 131.  
115 Appellate Body Report, US – Tyres (China) , para. 147.  
116 Appellate Body Report s, Argentina – Footwear (EC) , fn 130; and US – Tyres (China) , para. 146 .  WT/DS490/R • WT/DS496/R  
 
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  market and the product .117 Furthermore, the increase in imports must be "recent enough " in 
relation to not only the substantive determination made by the competent authority in an 
underlying investigation but also a Member's decision to apply a safeguard measure.118 
7.5.2.3   Relevant facts  
7.65.   Indonesia initiated the safeguards investigation on 19 December 2012.119 KPPI's analysis of 
increased imports was based on import volume data from a five -year POI ending on 
31 Decembe r 2012. It concluded the investigation approximat ely 15 months later on 
31 March  2014120, and the specific duty was imposed by the Minister pursuant to 
Regulation  137.1/PMK.011/2014 four months later, on 22 July 2014, approximately 19 months 
after the end of  the POI.121 The Chairperson of KPPI changed during the course of the investigation 
on 25  June 2013.122 
7.66.   KPPI's determination of increased imports was based on official import volume data from a 
POI ending on 31 December 2012, produced  by the Indonesian Statist ics Bureau. Import volume 
data for the final calendar -year of the POI (2012) were officially released by the Indonesian 
Statistics Bureau on 2 August 2013123, about seven months before the issuance of KPPI's Final 
Disclosure Report. Import volume data for ca lendar -year 2013 were published by the Indonesian 
Statistics Bureau on 4 August 2014.124 The import data relied upon in the petition for the initiation 
of the safeguards investigation includes data for the first half of calendar -year 2012, explicitly 
naming the Indonesian  Statistics Bureau  as the source.125 However, Indonesia asserts that the 
Indonesian Statistics Bureau does not officially publish half -yearly import statistics by country.126 
7.67.   No interested party requested KPPI to extend the POI during the course of the investigation. 
However, the last interaction between KPPI and the exporters from Chinese Taipei and Viet Nam 
prior to the Final Disclosure Report was at a public hearing on 23 April 2013127, almost one full 
year before the completion of the investigat ion on 31 March 2014. The Viet namese exporter, the 
Hoa Sen Group, was orally informed by KPPI of the outcome of the investigation around 
22 April 2014, and on the same date requested to see a non -confidential version of the Final 
Disclosure Report.128 A copy  of the non -confidential version of th e Final Disclosure Report was 
e-mailed by KPPI to the Hoa Sen Group on 20 May 2014.129 The Hoa Sen Group provided KPPI with 
its comments on the Final Disclosure Document on 3 June 2014. Those comments did not 
challenge t he POI in the underlying investigation.130 
7.68.   Indonesian law establishes an internal decision -making process for the imposition of a 
safeguard after the KPPI has finished its investigation and made a recommendation to the Minister 
                                                
117 Appellate Body Report , US – Steel Safeguards , paras. 358 -360.  
118 Panel Report, Ukraine – Passenger C ars, paras. 7.172  and 7.173.  
119 WTO, Committee on Safeguards, Notification Under Article 12.1(a) of the Agreement on Safeguards 
on initiation of an investigation and the reasons for it, G/SG/N/6/IDN/22, (Exhibit TPKM/VNM -2), p. 1.  
120 Indonesia's first writt en submission, para. 94;  and Final Disclosure Report, (Exhibit IDN -8), p. 30.  
121 Regulation of the Minister of Finance of the Republic of Indonesia No. 137.1/PMK.011/2014 on 
imposition of safeguarding duty against the import of flat -rolled products of i ron or non -alloy steel 
(22 July 2014), (Exhibit IDN -20), p. 6. Regulation 137.1/PMK.011/2014 was "stipulated" by the Minister of 
Finance of the Republic of Indonesia on 7 July 2014; "promulgated" by the Minister of Justice and Human 
Rights of the Republic of Indonesia on 15 July 2014; and entered into legal effect on 22 July 2014.   
122 Indonesia's response to Panel question No. 59, para. 38.  
123 Indonesia's response to Panel question No. 15, para. 24; and Indonesia 's Official Import Statistics 
for 2012, (Exhibit I DN-40). 
124 Indonesia's second written  submission, para. 54; and Publication date of 2013 Import Data 
Statistics , (Exhibit IDN -43). 
125 Request for Application of Safeguard Measure (Non -confidential Summary) , 12 December 2012 , 
(Exhibit TP KM/VNM-11), section E.  
126 Indonesia's response to Panel question No. 57, para. 36.  
127 Indonesia's first written submission, para. 94; and complainants' response to Panel question No. 11.  
128 Complainants' response to Panel question No. 11; and Letter dated 22 Apri l 2014 from 
Hoa Sen Group's counsel to KPPI, (Exhibit TPKM/VNM -16). 
129 Complainants' response to Panel question No. 11; and Email dat ed 20 May 2014 from KPPI to 
Hoa Sen Group's counsel, (Exhibit TPKM/VNM -18). 
130 Indonesia's second written  submission, para. 51; and  Letter date d 3 June 2014 from  Hoa Sen's Legal 
Counsel Submitting Comments on KPPI 's Final Disclosure Report , (Exhibit IDN -42). WT/DS490/ R • WT/DS496/R  
 
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  of Trade. This process require s the Minister of Trade to inform the Minister of Finance of a decision 
to impose a safeguard duty within 30 working days of the receipt of the letter of recommendation 
from KPPI.131 However, before doing so, the Minister of Trade must forward KPPI's 
recomme ndation to various Indonesian government Ministries for the purpose of considering 
whether the imposition of a safeguard duty would be in the national interest. Under Indonesian 
law, the consulted Ministries are required to provide their "considerations" t o the Minister of Trade 
within 14 working days132, failing which, the relevant Ministries "shall be deemed" to have agreed 
with KPPI's recommendation.133 The Minister of Finance has 30 working days from the receipt of 
the letter from the Minister of Trade to i ssue a decree for the purpose of applying the proposed 
safeguard measure.  
7.69.   Following the issuance of the Final Disclosure Report on 31 March 2014, KPPI sent a letter 
to the Minister of Trade on 10 April 2014 recommending the imposition of the specific duty  in 
accordance with the results of the underlying investigation. This letter initiated the internal 
decision -making process contemplated under Indonesian law, which would ultimately result in the 
imposition of the specific duty. The Minister of Trade forwa rded KPPI's recommendations to the 
relevant Ministries on 21 April 2014.134 A meeting to consider the "national interest" was held on 
12 May 2014 between the Coordinating Ministry of Economic Affairs, the State Ministry of National 
Development Planning, the Ministry of Finance, the Ministry of Industrial Affairs, the Ministry of 
Trade , and KPPI.135 Following this meeting, the Minister of Trade sent a letter to the Minister 
Finance on 26 May 2014 concerning the proposed safeguard measure.136 Two "technical" meetin gs 
of the "Tariff Team" were held on 20 and 24 June 2014 among officials of the Ministry of Trade, 
Ministry of Finance , and Ministry of Industry.137 Regulation 137.1/PMK. 011/2014 was "stipulated" 
by the Minister of Finance of the Republic of Indonesia on 7 J uly 2014; "promulgated" by the 
Minister of Justice and Human Rights of the Republic of Indonesia on 15 July 2014; and entered 
into legal effect on 22 July 2014.138  
7.5.3   Threat of serious injury  
7.5.3.1   Parties' arguments  
7.70.   The complainants claim that KPPI's serious injury  analysis and threat of serious injury 
determination  are inconsistent with Articles  3.1, 4.1(a), 4.1(b), 4.2(a) , and 4.2(c) of the 
Agreement on Safeguards and, consequently, with Article  2.1 of the Agreement on Safeguards and 
Article  XIX:1(a) of the GATT  1994. In essence, the complainants advance the following three lines 
of argument to support their claims : first, the Final Disclosure Report contains no analysis  or 
finding  of whether serious injury was "clearly imminent"139 in order to establish that the dom estic 
industry was suffering from a threat of serious injury ; second, KPPI failed to examine the rate and 
amount of the increase in imports relative to domestic production140; and third, KPPI failed to 
provide a reasoned and adequate explanation of its findi ngs because it failed to properly analyze a 
                                                
131 Government Regulation No. 34 of 2011 Concerning Anti -dumping Measure, Countervailing Measure, 
and Safeguard Measure , Article 84(5), GR 34/ 2011, (Exhibit IDN -6). 
132 Government Regulation No. 34 of 2011 Concerning Anti -dumping Measure, Countervailing Measure, 
and Safeguard Measure , GR 34/2011, (Exhibit IDN -6), Article 84(2) . 
133 Government Regulation No. 34 of 2011 Concerning Anti -dumping Measure , Countervailing Measure, 
and Safeguard Measure , GR 34/2011, (Exhibit IDN -6), Article 84(3) . 
134 Indonesia's first written submission, Table  1, para. 30.  
135 Indonesia's first written submission, Table  1, para. 30.  
136 Indonesia's first written submission, Table  1, para. 30.  
137 Indonesia's first written submission, Table  1, para. 30.  
138  Regulation of the Minister of Finance of the Republic of Indonesia No. 137.1/PMK.011/2014 on 
imposition of safeguarding duty against the import of flat -rolled products of i ron or non-alloy steel 
(22 July 2014), (Exhibit IDN -20). 
139 Complainants' first written submission, paras.  5.57, 5.88 -5.90, and 5.92; second written  submission, 
paras. 2.74 and 2.75.  
140 Complainants' first written submission , paras. 5.70-5.75; second written  submi ssion, 
paras.  2.50-2.59; and response to Panel question Nos. 18 and 19.  According to the complainants, the 
evaluation of increased imports in "relative terms" that is called for in Article 4.2(a) of the Agreement on 
Safeguards should be understood, in the context of Article 2.1, to mean that a competent authority's serious 
injury analysis must involve a consideration of the extent to which imports increased " relative to domestic 
production ".  WT/DS490/R • WT/DS496/R  
 
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  number of factors individually and collectively, including trends in market shares, capacity 
utilization, captive production, inventories, production, productivity , and employment.141 
7.71.   Indonesia rejects the complain ants' criticisms of KPPI's threat of serious injury 
determination. While not pointing to any explicit analysis or finding in the Final Disclosure Report 
regarding whether serious injury was "clearly imminent", Indonesia maintains that it was clear on 
the b asis of KPPI's findings that "serious injury was on the verge of occurring if not for the 
implementation of this safeguard measure".142 Moreover, Indonesia contends  that the Final 
Disclosure Report shows  that KPPI reviewed all mandatory injury factors in con formity with 
Article  4.2(a), including the rate and amount of the increase in imports of the product concerned 
relative to domestic consumption . According to Indonesia, KPPI was not required to examine the 
rate and amount of the increase in imports relativ e to production .143 Indonesia argues that,  in 
order to make sense of  the textual difference between Article 2.1  (which is focused on an increase  
in imports that is " relative to domestic production ") and Article 4.2(a) (which requires the 
investigating author ity to evaluate increased imports in "relative terms", without defining the 
notion of "relative terms") , the expression "relative terms"  in Article 4.2(a) should not be 
construed as limiting the comparison of increased imports to domestic production .144 Indonesia 
also submits that the Final Disclosure Report contains a reasoned and adequate explanation of how 
all of the various injury factors supported KPPI's overall conclusion that the increased imports of 
galvalume threatened to cause serious injury to the domestic industry.145  
7.5.3.2   Relevant law  
7.72.   Serious injury and threat of serious injury are defined in Article  4.1 of the Safeguard 
Agreement as follows:  
(a) "serious injury" shall be understood to mean a significant overall impairment in 
the position of a domestic industry;  
(b) "threat of serious injury" shall be understood to mean serious injury that is 
clearly imminent, in accordance with the provisions of paragraph 2. A determination of 
the existence of a threat of serious injury shall be based on facts and not m erely on 
allegation, conjecture or remote possibility.  
7.73.   The plain language of Article s 4.1(a) and (b) establishes that a determination of threat of 
serious injury must be based on a finding that serious injury, i.e. a significant overall impairment 
in the position of the domestic industry, is clearly imminent.  Serious injury has been interpreted to 
mean a "very high standard" of injury, "much higher" than the standard of material injury 
contemplated under the AD and SCM Agreements.146 The difference between a  finding of "serious 
injury" and a "threat of serious injury" is not in terms of the degree or significance of injury itself, 
but rather whether injury is already occurring  or, although not presently occurring, will occur soon . 
In other words, w hereas a fi nding of "serious injury" implies that a significant overall impairment 
in the position of the domestic industry has already materialized, a determination of "threat of 
serious injury" means that such a situation has yet to occur, but is "clearly imminent" .147 
                                                
141 Complainants' first written submission , para s. 5.77-5.87; secon d written  submission, 
paras.  2.60-2.73; response to Panel question Nos. 16, 17, and 70; and comments on Indonesia's response to 
Panel question Nos. 64, 65, and 67 . 
142 Indonesia's  first written submission, para. 1 39; response to Panel question No. 22; and second 
written  submission, paras. 71 -75. 
143 Indonesia's first written submission, paras. 124 and 125; response to Panel question Nos. 26 and 27.  
Indonesia argues, inter alia , that the absence of any textual reference to "domestic production" in the 
requiremen t in Article 4.2(a) to evaluate increased imports "in relative terms" means  that a competent 
authority is left with a discretion to determine whether to examine imports relative to domestic production 
and/or consumption in any given investigation.   
144 Indon esia's  first written submission, para s. 128, 130, and 131; opening statement at the second 
meeting of the Panel, para. 41.  
145 Indonesia's  first written submission, paras. 134 -138; second written  submission, paras. 81 -84; and 
response to Panel question Nos. 64-68. 
146 Appellate Body Report, US – Lamb , paras. 124 -126. 
147 Appellate Body Report, US – Lamb , para. 125.  WT/DS490/ R • WT/DS496/R  
 
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  7.74.   In making a determination of a threat  of serious injury , a competent authority must 
demonstrate, on the basis of facts rather than allegations, conjecture  or remote possibility , that 
serious injury is highly likely to occur in the very near future. Article 4.2(a) identifies a number of 
factors that must be evaluated for this purpose. This provision r eads:  
In the investigation to determine whether increased imports have caused or are 
threatening to cause serious injury to a domestic industry under the ter ms of this 
Agreement, the competent authorities shall evaluate all relevant factors of an 
objective and quantifiable nature having a bearing on the situation of that industry, in 
particular, the rate and amount of the increase in imports of the product con cerned in 
absolute and relative terms, the share of the domestic market taken by increased 
imports, changes in the level of sales, production, productivity, capacity utilization, 
profits and losses, and employment.  
7.75.   In the context of a determination of threat of serious injury, the fact -based evaluation that 
is called for in Article  4.2(a) "must provide the basis for a projection that there is a high degree of 
likelihood of serious injury to the domestic industry in the very near future".148 Data pertaining to  
the end of the POI will provide "an essential and, usually, the most reliable basis"149 for making 
such a determination. Simply comparing end points will not suffice, particularly when evaluating 
the rate and amount of the increase in imports in absolute an d relative terms.150 However, a ny 
short-term trend associated with the most recent data must be reviewed in the context of the 
longer -term trends of the entire POI.151 Thus, a competent authority's threat of serious injury 
determination must be based on an eva luation that considers and gives proper weight to data from 
the entire POI.  
7.76.   Similarly, while Article  4.2(a) requires that the existence of injury be determined on the 
basis of an examination of at least all of the listed factors152, each one does not necess arily have 
to show negative development. It follows from the definition of serious injury that, ultimately, 
what must be shown is that the overall position  of the domestic industry has been significantly 
impaired, not simply that certain relevant factors a re showing declines.153 Thus, where a 
competent authority's evaluation of injury factors reveals both negative and positive performance, 
a reasoned and adequate explanation must be provided of why the totality of the factors 
demonstrates that the overall pos ition of the domestic industry is significantly impaired.154 
7.5.3.3   Relevant facts  
7.77.   KPPI's injury and price effects analyses are set out in paragraphs 40 -51 of the Final 
Disclosure Report155, where a number of factors are examined , including  the rate of increase in 
imports in absolute terms, the domestic market shares held by the petitioner s and imports, and 
changes in the petitioner s' levels of stocks, sales, production, production capacity, production 
costs, selling prices, productivity, profits , and employment. KPPI 's injury determination contains no 
findings with respect to the amount or rate of increase in imports relative to domestic production . 
However, KPPI discussed the rate of increase in imports relative to domestic consumption.156 
7.78.   KPPI's determination identifi es a number of indicators showing positive trends over  the POI. 
These include the finding that the "trend" in national consumption was an increase of 34% 
between 2008 and 2012,  with the "trends" in the petitioner s' production, sales and employment 
                                                
148 Appellate Body Report, US – Lamb , para. 1 36. 
149 Appellate Body Report, US – Lamb , para. 137 . 
150 Appellate Body Report , Argentina – Footwear (EC) , para . 129. 
151 Appellate Body Report , US – Lamb , para. 138. 
152 Appellate Body Report , Argentina – Footwear (EC) , para s. 136 and 137 . 
153 Appellate Body Report s, Argentina – Footwear (EC) , para. 139; and US – Lamb , fn 86 . 
154 Panel Report, Dominican Republic – Safegua rd Measure s, paras. 7.304 -7.314.  
155 The introductory section of the Final Disclosure Report reveals that KPPI defined the domestic 
industry investigated for the purpose of the serious injury analysis by reference to the two petitioners, which it 
found to ac count for 77% of total domestic production of the like product.  (Final Disclosure Report, 
(Exhibit  IDN-8), para. 8).  
156 Final Disclosure Report, (Exhibit IDN -8), para. 41.  WT/DS490/R • WT/DS496/R  
 
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  levels being increases of , respectively, 32%, 29% , and 16%  over the same period .157 The 
petitioner s' installed capacity "increased significantly" due to "the beginning of effective operation" 
of one of the petitioner companies in 2011 and the addition of capacity by  the other petitioner 
company, in both cases to "anticipate the increase of national consumption" .158 Profits were 
achieved in two of the five years of the POI  – 2010 and 2011, while losses were reported in the 
other three years .159  
7.79.   KPPI's determination also identifies a number indicators of performance which showed 
negative trends. These include t he "trend" in the petitioner s' stock s, which  increased 75%, and the 
"trend" in the petitioners' selling prices , which declined 4.5% over the POI160, with import  prices 
undercutting the petitioner s' sales prices in all years except in 2008.161 As noted, l osses were 
incurred in three years of the POI162, and employment fell between 2011 and 2012.163 The Final 
Disclosure Report also reveals that the petitioners were operating be low 100% capacity utilization 
and consistently below the levels of production they had targeted to achieve in each of the years 
of the POI.164  
7.80.   In terms of market shares, the Final Disclosure Report states that the "trend" in the share of 
domestic consumptio n held by the petitioner s fell by 4% over the POI , while the "trend" in the 
share of domestic consumption held by imports grew by 6% over the same period.  Evidence 
submitted by the complainants derived from information in the Fina l Disclosure Report and 
Exhibit IDN-41 shows that between 2010 and 2012, the petitioners experienced the highest 
market share increase relative to imports and other domestic producers.165 In other words, the 
petitioners'  market share grew at a faster rate than those of imports and ot her domestic producers 
at the end of the POI. The same evidence also shows that the petitioners' market share between 
2010 and 2012 was below their market share in 2008 and 2009. Moreover, the market share held 
by imports increased in all years with the ex ception of 2008 -2009.  
7.81.   Indonesia denies the accuracy of the complainants' evidence, asserting that it does not 
reflect the actual figures used in KPPI's confidential analysis.166 Indonesia has not, however, 
revealed the actual figures used by KPPI, and in its  submissions refers only to the indexed, 
non-confidential, numbers identified in the Final Disclosure Report. In the light of the information 
contained in Exhibit IDN -41 and the complainants' explanation of their calculation methodology167, 
we understand the evidence submitted by the complainants' in Exhibit TPKM/VN M-35 (BCI) to 
accurately reflect figures that, mathematically , appear to have been the basis of the indexed 
numbers used in KPPI's non -confidential analysis.   
7.82.   During the investigation, an associati on of importers of galvalume submitted that one of the 
petitioner companies (PT. NS Bluescope Indonesia) produced galvalume mainly for its own captive 
production of painted  galvalume, and that this caused a deficit in domestic supply of the 
investigated pr oduct.168 KPPI responded by confirming that Bluescope produced both "bare" and 
"painted" galvalume. However, KPPI noted that "those products were produced based on different 
manufacturing order and production plan" and that the "production process for those products 
                                                
157 Final Disclosure Report, ( Exhibit IDN -8), Tables 8, 9, and 14, and paras. 43 -44 and  49. The 
percentage values are labelled as "trends" in the relevant tables, but described in the associated paragraphs as 
"increases", "decreases", or "declines" without being identified as "trends". Indonesia has explained that the 
POI "trend" values were  determined using the LOGEST function in Excel. (Indonesia's response to Panel 
question No. 23).  
158 Final Disclosure Report, (Exhibit IDN-8), para. 44.  
159 Final Disclosure Report, (Exhibit IDN-8), Table  13. 
160 Final Disclosure Report, (Exhibit IDN-8), Tables 12 and 15, and paras. 47 and 50. (The percentage 
values are labelled as "trends" in the relevant tables, but described in the associated paragraphs as 
"increases", "decreases", or "declines" without being identified as "trends").  
161 Final Disclosure Report , (Exhibit IDN-8), para. 50. 
162 Final Disclosure Report , (Exhibit IDN-8), para. 48. 
163 Final Disclosure Report , (Exhibit IDN-8), para. 49. 
164 Final Disclosure Report , (Exhibit IDN-8), Table  11 and para. 46. 
165 Recalculatio n of sale volumes and market shares of imports and of the petitioners' products, 
(Exhibit  TPKM/V NM-35) (BCI), Tables 2 and 3.  
166 Indonesia's response to Panel question No. 64, para. 39; comments on complainants' response to 
Panel question No. 69, para. 44.  
167 Complainants' response to Panel quest ion No. 69.  
168 Final Disclosure Report, (Exhibit IDN-8) para. 25.b.  WT/DS490/ R • WT/DS496/R  
 
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  were also different".169 There is no further discussion of the extent to which the petitioners  
produced bare galvalume for their own captive production of painted galvalume in the Final 
Disclosure Report.  
7.83.   The complainants accept that bare galvalume cannot be used to produce painted galvalume 
once it has been "treated with anti -finger resin".170 Indonesia notes that in order to produce 
painted galvalume, bare galvalume "needs to go through a 'skin pass mill' to create a rough 
surface, which is not requi red in the production of bare galvalume".171 The Final Disclosure Report 
describes the production process of the investigated product to involve the following two forms of 
"surface treatment":  
Skin Pass Mill to repair the surface, specifically for painting p roducts.  
Anti Finger Print to cover the goods with resin to have the Anti Finger Print function so 
it does not leave any marks when the goods was touched and it can be utilized as 
lubricant during the forming process, which can be utilized as aesthetics if  it is added 
with color pigments.172  
7.84.   Finally, although KPPI's "causal link" analysis states that the petitioners "suffered serious 
injury" as a result of the surge in imports173, it is apparent from the concluding paragraphs of the 
Final Disclosure Report tha t KPPI's ultimate injury finding is that the "Petitioner[] is suffering from 
the threat  of serious injury".174 Indonesia's notification to the WTO confirms that the basis for the 
safeguard measure is a finding of threat  of serious injury. However, the Final Disclosure Report 
does not discuss the extent to which the findings with respect to the injury factors, or any other 
considerations, demonstrate that "serious injury" was " clearly imminent ". Indeed, no explicit 
finding that "serious injury" was "clearly im minent" is set out in the Final Disclosure Report.  
7.5.4   Causation  
7.5.4.1   Parties' arguments  
7.85.   The complainants claim that KPPI's determination of causation was inconsistent with 
Article  XIX:1(a) of the GATT 1994 and Articles  2.1, 3.1, 4.2(b), and 4.2(c) of the Agreemen t on 
Safeguards because KPPI failed to provide a reasoned and adequate explanation of its findings in 
relation to:  (a) the coincidence in time between the increased imports of galvalume and the threat 
of serious injury, in light of the conditions of compet ition in the Indonesian market; and ( b) the 
impact of factors other than imports of galvalume on the situation of the domestic industry.175 In 
particular, according to the complainants, KPPI's causation finding rests entirely on an 
unsubstantiated assertion about the coincidence in time between an alleged decrease in market 
share of the domestic industry relative to imports – an assertion the complainants maintain is, in 
any case, contradicted by the data from the POI. The complainants further argue that KPPI  failed 
to properly analyse and explain how factors other than imports of galvalum e (such as competition 
from other domestic producers, capacity investments, anti -dumping duties and the entry of a new 
domestic producer in 2011) contributed to serious injur y, and how the effects of such factors were  
not attributed to the imports of galvalum e.176 
7.86.   Indonesia argues that KPPI properly demonstrated the existence of a causal link between 
the increased imports of galvalume and the threat of serious injury. Indonesia submits that the 
data relied upon in the Final Disclosure Report demonstrate a temporal coincidence between, on 
the one hand, the increased market share of imports and, on the other hand, the 
                                                
169 Final Disclosure Report, (Exhibit IDN-8), para. 26.b.  
170 Complainants' response to Panel question No. 70, para. 1.61.  
171 Indonesia's opening statement at the second meeting with the Panel, para. 45.  
172 Final Disclosure Report, (Exhibit IDN-8), para. 34.  
173 Final Disclosure Report, (Exhibit IDN-8), para. 62  
174 Final Disclosure Report, (Exhibit IDN-8), paras. 63 -65.(emphasis added)  
175 Complainants' first written submission, paras. 5.94, 5.105 -5.110, and 5.114; opening statement at 
the first meeting of the Panel, paras. 5.1 -5.4. 
176 Complainants' response to Panel question Nos. 28 and 30; second written  submission, 
paras.  2.95-2.104 ; opening statement at the second meeting of the Panel, paras. 5.1 -5.5; and comments on 
Indonesia's response to Panel question No. 71, para. 1.38, and No. 72, para. 1.39.  WT/DS490/R • WT/DS496/R  
 
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  petitioners'  decreased market share, increased inventories, and losses, thereby justifying KPPI's 
causation findings.177 Indonesia rejects the complainants' criticisms of KPPI's non -attribution 
analysis, arguing that while KPPI did not take into account all relevant factors (which Indonesia 
accepts "might" have included those identified by the complainants), KPPI did, according to 
Indonesia, consider "the most relevant factors", thereby fulfilling the requirements of Article  4.2(b) 
of the Agreement on Safeguards.178 In any case, Indonesia submits that certain findings made by 
KPPI demonstrate that the non -attribution factors identified by the complainants did not cause any 
injury to the petitioners.179 
7.5.4.2   Relevant law  
7.87.   Article  4.2(b) of the Agreement on Safeguards provides as follows:  
The determination referred to in subparagraph (a) [of Article  4.2] shall not be made 
unless this investigation demonstrates, on the basis of objective evidence, the 
existence of the causal link between increased imports of the product concerned and 
serious injury or threat thereof. When factors other than increased imports are 
causing injury to the domestic industry at the same time, such injury shall not be 
attributed to increased imports.  
7.88.   Under the first sentence of Article  4.2(b) , competent authorities are required to establish a 
"genuine and substa ntial relationship of cause and effect" between the increased imports and 
serious injury180 – that is, "a relationship of cause and effect such that increased imports 
contribute to 'bringing about', 'producing' or 'inducing' the serious injury".181 The Agreeme nt on 
Safeguards does not prescribe any particular method or analytical tool for making this 
determination.182 However, it is recognized that consideration of the temporal relationship between 
"movements" in the volume and market share of imports and "moveme nts" in the injury factors 
will be central to a causation analysis and determination.183 Thus, in previous disputes under the 
Agreement on Safeguards, panels called upon to examine the merits of a competent authority's 
causation findings have examined whethe r upward trends in imports coincided with downward 
(i.e. worsening) trends in the injury factors, and if not, whether an adequate explanation was 
provided as to why the data nevertheless show causation.184  
7.89.   The second sentence of Article  4.2(b)  sets out the requirement to ensure that injury caused 
to the domestic industry by factors other than increased imports is not attributed to the increased 
imports. It is well established that in order to comply with this requirement, a competent authority 
must separate and distinguish the injurious effects of the increased imports from the injurious 
effects of other factors causing injury to the domestic industry at the same time.185 Competent 
authorities must not only "identify" the nature and extent of the injurious effe cts of the known 
factors other than increased imports, but they must also "explain" satisfactorily the nature and 
extent of the injurious effects of those other factors as distinguished from the injurious effects of 
increased imports.186 However, the need to  separate and distinguish the effects caused by 
increased imports and the effects caused by other factors " does not necessarily imply … that 
increased imports on their own  must be capable of causing serious injury, nor that injury caused 
by other factors m ust be excluded  from the determination of serious injur y".187 The causation 
                                                
177 Indonesia's first written submission, para. 162; opening statement at the first meeting of the Panel, 
para. 52; and opening statement at the second meeti ng of the Panel, para. 54.  
178 Indonesia's first written submission, paras. 163 -165; second written  submission, paras. 93 -97. 
179 Indonesia's first written submission, paras . 163-167; opening statement at the first meeting of the 
Panel, para. 54; response to P anel question Nos. 32, 33, and 71 -73; second written  submission, paras. 94 -97; 
and opening statement at the second meeting of the Panel, paras. 56 -59. 
180 Appellate Body Report s, US – Lamb , para. 179; and US – Steel Safeguards , para.  488. 
181 Appellate Body Re port, US – Line Pipe , para.  209 (referring to Appellate Body Report, US – Wheat 
Gluten , paras. 67 and 68) . 
182 Panel Reports, US – Steel Safeguards , paras. 10.294 and 10.296 ; and Korea – Dairy , para.  7.96. 
183 Appellate Body Report, Argentina – Footwear  (EC), para. 144.  
184 See, e.g. Panel Reports, US – Wheat Gluten , paras. 8.95 -8.102; and Argentina – Footwear  (EC), 
para. 8.237 -8.246 .  
185 Appellate Body Report s, US – Wheat Gluten , para. 68; US – Lamb , para. 179; and US – Line Pipe , 
para. 215. 
186 Appellate Body Repo rt, US – Line Pipe , para. 215.  
187 Appellate Body Report, US – Wheat Gluten , para. 70. (emphasis original)  WT/DS490/ R • WT/DS496/R  
 
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  requirement in Article  4.2(b) "can be met where the serious injury is caused by the interplay of 
increased imports and other factors".188  
7.90.   A competent authority's non -attribution analy sis must establish explicitly, through a 
reasoned and adequate explanation, that injury caused by other factors is not attributed to 
increased imports. Such "explanation must be clear and unambiguous. It must not merely imply or 
suggest an explanation. It must be a straightforward explanation in express terms".189 Moreover, 
in cases involving a threat of serious injury , a competent authority's analysis must "include a 
forward -looking assessment  of whether other factors currently causing injury to the domestic  
industry will continue to do so  in the very near future ".190  
7.91.   Finally, a competent authority's causation determination must analyze the conditions of 
competition  between the imported and domestic products in the context of determining the 
existence of a cau sal link between the increased imports and serious injury to the domestic 
industry.191 The factors to be considered in the requisite analysis may include not only those 
mentioned in Article  4.2(a), but also  factors such as price, physical product characteris tics, quality, 
service, delivery, technological developments, consumer tastes, and other supply and demand 
factors in the market .192 
7.5.4.3   Relevant facts  
7.92.   KPPI's non -attribution and causation analyses are set out in Sections D and F of the 
Final Disclosure Report, as well as in KPPI's specific responses to various submissions made by 
interested parties. Section D, which is headed "other factors", examines the impact of three factors 
"other than the surge of imports" of galvalume on the situation of the domestic indu stry. Section F 
is headed "causal link" and contains KPPI's analysis and final determination that the "surge in 
imports" caused a threat of serious injury.  
7.5.4.3.1   "Other Factors"  
7.93.   The first "other factor" examined in Section D is the evolution of the domestic indu stry's 
production capacity over the POI relative to national consumption. During the course of the 
investigation, a number of interested parties had argued to KPPI that the domestic industry could 
not satisfy domestic demand.193 The indexed data presented in  Table 17 reveal that the installed 
production capacity of the domestic industry stayed the same in the first two years of the POI, but 
then increased more than five -fold in the last three years of the POI. At the same time, national 
consumption of galvalu me decreased between 20 08 and 20 09, but thereafter increased in the last 
three years of the POI. On the basis of the indexed data presented in Table 17, KPPI concluded 
that: (a) "the domestic industry was able to meet … national demand"; (b) the "increase in 
production capacity by domestic industry was in line with the increase of national consumption, 
and thus production capacity was not a factor that caused injury to the Petitioners"; and (c) "the 
surge of imports was not caused by the domestic industry's  inability to meet national 
consumption".194  
7.94.   The second "other factor" examined in Section D is the evolution of the petitioners' sales 
over the POI. The indexed data presented in Table  18 show that PT. NS Bluescope  made fewer 
sales in 2009 and 2010 compare d with 2008, but that its sales increased in each of the remaining 
two years of the POI and in 2012  were 70% above the 2008 level. The data also show that the 
second petitioner, PT. NS Sunrise Steel , made its first sales only in 2011 and that its sales mor e 
                                                
188 Appellate Body Report s, US – Wheat Gluten , paras. 67 and 68; and  US – Line Pipe , para. 209.  
189 Appellate Body Report, US – Line Pipe , para. 217.  
190 Panel Report, Ukraine – Passenger Cars , para. 7.319. (emphasis added)  
191 Panel Report s, Argentina – Footwear (EC) , para s. 8.229  and 8.250 ; US – Wheat Gluten , para s. 8.91  
and 8.108 ; US – Lamb , para.  7.232; and US – Steel Safeguard s, paras. 10.313 -10.321 ; and Appellate Body 
Report s, Argentina – Footwear (EC) , para.  145; and US – Wheat Gluten , paras. 76 -78. 
192 Panel Report, US – Steel Safeguards , paras. 10.318 -10.320 (referring to Appellate Body Report, 
US – Wheat Gluten , para. 7 3; and Panel Report s, Argentina – Footwear (EC) , para. 8.2 51; and Korea – Dairy , 
para. 7.51) . 
193 Final Disclosure Report, (Exhibit IDN-8), paras. 19e (Hoa Sen Group), 25a (importers' association), 
and 27a (importers' association).  
194 Final Disclosure Report, (Exhibit IDN-8), Table  17 and para.  55. WT/DS490/R • WT/DS496/R  
 
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  than doubled in the following year. After noting that the sales of both petitioners increased 
between 2011 and 2012, KPPI states that the data shows "that there is no competition between 
Petitioners since each of the Petitioners' sales increased". Thus, KPPI concludes that "competition 
between the Petitioners was not the factor that caused the threat of serious injury".195 
7.95.   The final "other factor" discussed in Section D is the fact that the petitioners produced 
galvalume in accordance with "standardization"  "based on SNI and International Organization for 
Standardization (ISO)". KPPI concludes from this fact that "domestic product was able to compete 
with imports".196 During the investigation, Viet Nam argued that "representative of the association 
stated that  Galvalum from Vietnam has better quality and already obtained the SNI certificate".197 
7.96.   In the final paragraph of Section D, KPPI states that it "did not find any other factors 
causing serious injury to the petitioner, other than the surge of imports" of gal valume.  
7.97.   KPPI's examination of "other factors" does not specifically address any of the four "other 
factors" which the complainants submit should have been considered. First, the 
complainants'  argue that KPPI should have examined the impact of competition f rom domestic 
producers other than the petitioners . In this respect, we note that the data presented by the 
complainants in Exhibit TPKM/VN M-35 (BCI) reveals that during the only two years when the 
market share of the petitioners' declined (2009 and 2010), the market share of Indonesian 
producers other than the petitioners doubled, while the market share of imports declined in 2009 
before returning in 2010  to approximately the same level as reported for 2008. However, the 
market share of Indonesian producers  other than the petitioners fell in the last two years of the 
POI, dropping below the 2008 level in 2012, while the market share of imports and the petitioners 
both increased in the last two years of the POI. One of the exporters, the Hoa Sen Group, argued  
to KPPI that the injury suffered by the domestic industry was caused by factors other than the 
increased imports, including "domestic competition".198 KPPI responded by referring to the analysis 
of "other factors" in Section D of the Final Disclosure Report199, which as described above focused 
on the issue of competition between the petitioners , and not between the petitioners and other 
domestic producers.  
7.98.   Second, according to the complainants, KPPI's examination of installed capacity should have 
involved mor e than simply assessing whether there was sufficient domestic production capacity to 
satisfy total domestic demand. For the complainants, KPPI's analysis should have also determined 
the extent to which losses could have been attributed to the expansion of the installed capacity.200 
The data presented in Exhibit TPKM/VN M-35 (BCI) reveal that there was a notable market 
presence of imports in each of the five years of the POI, ranging from 35% in 2009 (the lowest 
point) to 52% in 2012 (the highest), with values of around 45% in 2008, 2010, and 2011. 
Moreover, according to the indexed figures presented in Table 17 of the Final Disclosure Report, 
the domestic industry's installed capacity grew five -fold over the course of the POI, exceeding the 
level needed to sati sfy the entirety of national consumption in both 2011 and 2012. During the 
course of the investigation, an association of importers of galvalume argued that "[e]xpansion 
from PT. NS Bluescope Indonesia has affected their cash flow significantly".201 KPPI res ponded by 
stating that "PT. NS Bluescope Indonesia expanded in 2006. However, the performance of PT NS 
Bluescope Indonesia that supposedly increased, in fact declined due to the surge of imports …".202 
One of the exporters, the Hoa Sen Group, argued that the  injury suffered by the domestic industry 
was caused by factors other than the increased imports, including "expansion, addition in 
production capacity".203 KPPI responded to this submission by referring to the analysis of "other 
factors" in Section D of the  Final Disclosure Report.204 
                                                
195 Final Disclosure Report, (Exhibit IDN-8), Table  18 and para. 56.  
196 Final Disclosure Report, (Exhibit IDN-8), para. 57.  
197 Final Disclosure Report, (Exhibit IDN-8), para. 19m.  
198 Final Disclosure Report, (Exhibit IDN-8), para. 19k.  
199 Final Disclosure R eport, (Exhibit IDN-8), para. 14d.  
200 Complainants'  second written submission, para. 2.101 . 
201 Final Disclosure Report, (Exhibit IDN-8), para. 25f.  
202 Final Disclosure Report, (Exhibit IDN-8), para. 26f.  
203 Final Disclosure Report, (Exhibit IDN-8), para. 19k.  
204 Final Disclosure Report, (Exhibit IDN-8), para. 14d.  WT/DS490/ R • WT/DS496/R  
 
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  7.99.   Third, the complainants submit that KPPI's non -attribution analysis should have considered 
the impact on the costs of the domestic industry of the anti -dumping duties applied by Indonesia 
on imports of certain raw materials used in the production of galvalume. We note that this 
particular issue was raised before KPPI by the Indonesian Iron and Steel Association, which 
supported the investigation. In particular, the Indonesian Iron and Steel Association stated that it 
was "the impo sition of anti -dumping measure (BMAD) on the imported CRC, which was the main 
raw materials to produce Galvalum, that caused the increase of price and lower the competition 
level, and has slowly and adversely affected the domestic industry".205 KPPI did not respond to this 
submission, nor otherwise explicitly address the impact of the anti -dumping duties on the 
performance of the domestic industry in the Final Disclosure Report.  
7.100.   Fourth, according to the complainants, KPPI's non -attribution analysis should hav e 
considered the impact of the fact that o ne of the two petitioners  was a new entrant that  started 
making sales only in 2011.  During the investigation, an association of importers of galvalume 
argued that "PT. Sunrise Steel only started to operate in 2010 and thus has not obtained the 
optimal result, and has not even reach Break Even Point (BEP). Rendering the current safeguards 
investigation will be more irrelevant".206 KPPI responded to this submission by noting that "the 
surge in imports … reached the high est increase in 2011 and 2012" and that the "effect of imports 
also suffered by PT. Sunrise Steel, which can't obtain the optimal result and reach BEP".207 There 
is no other discussion or analysis of the impact of this fact on the petitioners' combined 
performance statistics anywhere in the Final Disclosure Report.  
7.5.4.3.2   "Causal link" 
7.101.   Section F of the Final Disclosure Report sets out KPPI's causation analysis and conclusions 
in five sentences  contained in paragraphs 60 to 63 . KPPI's discussion begins by noting that  
"national consumption" increased during the POI, but that "it could not be optimized by the 
Petitioners". KPPI then goes on to find that the "trend" in the petitioners' market share decreased 
"because it was absorbed by import market shares … where there is [a] surge of import[s] … in 
absolute terms", and that this "has caused their stock to increase and also caused them to suffer 
loss".208 In this light, and recalling its injury and non -attribution findings, KPPI concludes that the 
"surge of imports of Galv alum was the cause of threat of serious injury suffered by Petitioners".209 
7.102.   The indexed data presented in Table  7 reveal that the "trend" in the petitioners' market 
share over the POI was a decrease of 4 percentage points, while the "trend" in the market sha re of 
imports was an increase of 6 percentage points.210 The uni ndexed data reported in 
Exhibit  TPKM/VN M-35 (BCI) shows that during  the most recent part of the POI, 2011 and 2012, 
the petitioners' market share actually increased by  almost twice as many perce ntage points as the 
market share of imports.211 The same unindexed data also shows that the petitioners' market 
share between 2010 and 2012 was below their market share in 2008 and 2009. Moreover, the 
market share held by  imports increased in all years with the exception of 2008 -2009.  
7.103.   The complainants submit that KPPI's causation analysis should have explored the extent to 
which the introduction in 2009 of a new technical standard by Indonesia's National Standardization 
Agency impacted competition on the dome stic market. This factor had been raised by an 
association of steel manufacturers from Chinese Taipei , which had argued that the new standard 
created a "monopolistic" position for the domestic industry, improving their ability to raise 
prices.212 The Final D isclosure Report neither reports nor addresses the exporters ' allegation.  
                                                
205 Final Disclosure Report, (Exhibit IDN-8), para. 12b.  
206 Final Disclosure Report, (Exhibit IDN-8), para. 25f.  
207 Final Disclosure Report, (Exhibit IDN-8), para. 26f.  
208 Final Disclosure Report, (Exhibit IDN-8), paras. 60 and 61.  
209 Final Disclosure Report, (Exhibit IDN-8), para. 63.  
210 Final Disclosure Report, (Exhibit IDN-8), Table  7 and para. 41.  
211 Recalculatio n of sale volumes and market shares of imports and of the petitioners' products, 
(Exhibit  TPKM/V NM-35) (BCI), Table  2. 
212 Complainants' response to Panel question 30; second written  submission, para. 2.93; and Comments 
on the Petition and Information Submitted by Taiwan Steel & Iron Industry Association,  March 2013 , 
(Exhibit  TPKM/VNM -31), pp. 10 and 1 1. WT/DS490/R • WT/DS496/R  
 
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  7.5.5   Application of the s pecific duty 
7.5.5.1   Parties' arguments  
7.104.   The complainants claim that Indonesia acted inconsistently with its obligations under 
Articles  2.1, 3.1, 4.2(a) , and 4.2(b) of the  Agreement on Safeguards by deciding, on the grounds 
of national interest, to apply the safeguard measure on a narrower range of types of galvalum e 
(i.e. galvalume not exceeding 0.7mm in thickness) compared with the types investigated by KPPI 
(i.e. galvalu me not exceeding 1.2mm  in thickness ), in the absence of any reasoned and adequate 
explanation by the competent authority of how the narrowing down of the final safeguard 
measure's product scope satisfied the increased imports, serious injury and causality 
requirements .  
7.105.   The complainants argue that the narrow ing of the product scope in the application of the 
specific duty in the absence of adequate explanation was inconsistent with Articles 2.1, 4.2(a) , and 
4.2(b) of the Agreement on Safeguards because Indon esia failed  to ensure symmetry between the 
investigated product and the product subject to the applied safeguard measure  and thus 
disregarded the principle of parallelism.213 For the complainants, the principle of parallelism covers 
both the situation in whi ch imports from certain Members are being excluded from the geographic 
scope of the final safeguard measure as well as the situation in which certain products investigated 
by the competent authority in the course of the safeguard investigation are being ex cluded from 
the product scope of the final safeguard measure.214 In the complainants' view, any discrepancy 
between the product scope of the safeguard investigation and the product scope of the final 
safeguard measure must be properly reasoned consistently w ith Articles 3.1 and Article 4.2(c) of 
the Agreement on Safeguards.215  
7.106.   Indonesia submit s that the principle of "parallelism" was developed in the context of WTO 
dispute s involving the Agreement on Safeguards in relation to exclusions based on the source  of 
imports, and that this principle cannot be extended to the present set of facts.216 According to 
Indonesia, were the Panel to accept the complainants' view, it would "open a 'Pandora's box' 
where the principle of parallelism could be broadened even more in t he future, especially in light of 
similar languages or terms … found throughout the Agreement on Safeguards".217 In any case, 
Indonesia argue s that its decision to narrow the scope of the products subject to the safeguard 
measure for reasons of national inte rest is justified by the requirement in Article  5.1 of the 
Agreement on Safeguards to apply a safeguard measure "only to the extent necessary to prevent 
or remedy serious injury … and to facilitate adjustment".218 
7.5.5.2   Relevant law  
7.107.   We understand the parties' argu ments to raise the following threshold legal questions 
about the substance of, and relationship between, the obligations in Articles  2.1 and 5.1 of the 
Agreement on Safeguards, which have never before been addressed in WTO dispute settlement:  
a. Does the righ t granted in Article  2.1 to "apply a safeguard measure to a product " when it 
has been demonstrated that " such product " is being imported in such increased 
quantities and under such conditions as to cause serious injury , mean that a safeguard 
measure must be applied on exactly the same product (and range of product types ) 
examined and found to satisfy the conditions for imposing a safeguard measure in the 
underlying investigation ?  
                                                
213 Complainants' first written submission, paras. 5.115, 5.119, 5.126, 5.127, 5.130, 5.131,  and 5.132; 
response to Panel question No. 36; and second written  submission, para.  2.116.  
214 Complainants' response to Panel question No. 36. 
215 Complainants' first written submission, paras. 5.126, 5.130, and 5.132; response to Panel 
question  No. 36; and second written  submission, para.  2.115.  
216 Indonesia's second written  submission, paras. 102 and 103;  opening statement at th e 
second  meeting of the Panel, paras. 61 -64. 
217 Indonesia's second written  submission, paras. 104 -106; opening statement at the second meeting of 
the Panel, paras. 65 -67. 
218 Indonesia's second written  submission, paras. 108 -113; opening statement at the second meeting of 
the Panel, paras. 68 -70. WT/DS490/ R • WT/DS496/R  
 
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  b. To what extent does Article  5.1 justify the application of a safeguard mea sure on a range 
of product types  narrower than the product types examined in the underlying 
investigation and found to satisfy the conditions for the imposition of a safeguard 
measure? Does Article  5.1 permit the application of a safeguard measure on a narrow er 
range of product types relative to the investigated product types , in the absence of any 
finding that the narrower range of products  itself satisf ies the conditions for the 
imposition of a safeguard measure?  
7.108.   Having decided that it is not necessary to ma ke any findings on the legal merits of the 
complainants' claims under the Agreement on Safeguards in order to resolve this dispute, we 
consider that we are equally not required to express any views with respect to these legal 
questions. Nonetheless, as abo ve, we will proceed to identify facts relevant to an evaluation of the 
merits of the complainants' claims under the Agreement on Safeguards .  
7.5.5.3   Relevant facts  
7.109.   The Final Disclosure Report reveals that KPPI's safeguard investigation covered imports of 
"Galvalu m", defined as "Flat-rolled products of iron or non-alloy steel … with t hickness not 
exceeding 1,2 mm , under HS Code of 7210.61.11.00" .219 KPPI recommended that a safeguard 
measure in the form of a duty be imposed on imports of galvalume defined in this mann er.220 The 
analyses and findings in the Final Disclosure Report were focused on the defined product as a 
whole, and did not include any consideration of a narrower range of product types.  
7.110.   The safeguard measure adopted pursuant to Regulation 137.1/PMK. 011/20 14 was applied 
to a narrower range of products than those identified in KPPI's recommendation – specifically, to 
"flat-rolled products of iron or non-alloy steel … with the t hickness up to 0,7 mm"  falling  under 
HS code ex 7210.61.11.00.221 The decision to ap ply the safeguard measure to the narrower range 
of product followed the completion of the national interest process described above.222 Indonesia's 
tariff classification system does not list a separate  HS sub -heading for flat -rolled iron or non -alloy 
steel p roducts with a thickness of up to 0.7mm, making the availability of official import data for 
this narrower range of product "virtually (almost) impossible".223  
7.5.6   Notification  
7.5.6.1   Parties' arguments  
7.111.    The complainants claim that Indonesia's notification to the Comm ittee on Safeguards of 
26 May 2014 under Article 12.1(b) of the Agreement on Safeguards is the only relevant 
notification for the purpose of assessing Indonesia's compliance with its obligations under Article 
12.2, as this was the only notification made be fore the entry into force of the measure. The 
complainants claim that this notification is inconsistent with Article 12.2 because it fails to provide 
"all pertinent information ", as required by that provision.224  
7.112.   Indonesia acknowledges that its notification  of 26 May 2014 did not satisfy the 
requirements of Article  12.2 in that it did not contain a precise description of the proposed 
measure, its proposed date of introduction, and the expected duration and timetable for 
progressive liberalization.225 However, according to Indonesia , information about these elements 
                                                
219 Final Disclosure Report, (Exhibit IDN -8), para. 29.  
220 Final Disclosure Report, (Exhibit IDN -8), paras. 64 -66. 
221 Regulation of the Minister of Finance of the Republic of Indonesia No. 137.1/PMK.011/2014 on 
imposition of safeguarding duty against the impor t of flat -rolled products of i ron or non -alloy steel 
(22 July 2014), (Exhibit IDN -20), pp. 3 and 4. See also, Committee on Safeguar ds, Notification Under 
Articles  9, 12.1(b), and 12.1(c), and Footnote 2 of the Agreement on Safeguards (28 July 2014), 
G/SG/N /8/IDN/16/Suppl.1, G/SG/N/10/IDN/16/Suppl.1, G/SG/N/11/IDN/14, (Exhibit TPKM/VNM -5), p. 1.  
222 Paras. 7.68 and 7.69. 
223 Indonesia's first written submission, para. 192.  
224 Complainants' first written su bmission, paras. 5.160 -5.164; opening statement at the first meeting 
of the Panel, paras. 8.1 -8.3; second written  submission, para. 2.138; and opening statement at the 
second  meeting of the Panel, para. 8.1.  
225 Indonesia's first written submission, para. 2 41; opening statement at the first meeting of the Panel, 
para. 70.  WT/DS490/R • WT/DS496/R  
 
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  did not exist until  the Minister of Finance promulgated the implementing regulation on 
15 July 2014 – that is, at the time that the final decision to apply the safeguard measure was 
actually made.226 Indonesia notes in this regard that, in such cases, the Technical Cooperation 
Handbook on Notification Requirements issued by the WTO Committee on Safeguards states that 
the notifying Member must indicate that such information is "not available" for the rel evant time. 
Indonesia maintains that its notification of 26 May 2014 followed this guidance.227 In any case, 
Indonesia argues that to the extent that its notification of 26 May 2014 lacked "pertinent 
information", its second Article  12.1(b) notification , dated 23 July 2014 , remedied that 
deficiency.228 Moreover, Indonesia asserts that the timing of such notifications falls within the 
purview of Article 12.1, and that the complainants have neither  challenged the timing of 
Indonesia's Article 12.1(b) notification  nor questioned its timeliness.229 In this connection, and 
referring to the Appellate Body report in US – Wheat Gluten , Indonesia submits that Article  12.2 
does not contain any obligation with respect to the timing  of Article  12.1(b) notifications, which is 
regulated by Article  12.1(b) itself.230  
7.113.   The complainants  argue that Indonesia 's notification of 23 July 2014 cannot rectify the 
deficiencies in its notification of 26 May 2014 because it was made after the challenged safeguard 
measure entered into force, an d according to the complainants, it follows from the specific 
language of Article  12.2 and the related context of Articles  8.1 and 12.3 of the Agreement on 
Safeguards, that all "pertinent information " required to be provided under Article  12.2 must be 
provided prior to the entry into force  of the safeguard measure.231 Moreover, the complainants 
submit that the Technical Cooperation Handbook on Notification Requirements  does not support 
Indonesia's position because it does not constitute a binding legal instru ment, a legal 
interpretation of the notification obligations, or the context or purpose for the interpretation of the 
provisions of the Agreement on Safeguards.  In addition, the complainants argue that the parts 
cited by Indonesia are drafted in general te rms and do not address the specific question of 
whether Members may submit all pertinent information after the entry into force of the 
measure.232 The complainants also submit that Indonesia's reliance on the Appellate Body report in 
US – Wheat Gluten  is mis placed because, in their view, the Appellate Body did not address the 
question of whether, pursuant to Article 12.2, a Member is entitled to notify "all pertinent 
information", or rectify deficiencies in its notification of a finding of serious injury unde r 
Article  12.1(b) after it had already applied the safeguard measure. Instead, the Appellate Body 
addressed a narrower question of whether a Member can submit  its notification under 
Article  12.1(c) after having decided to apply a safeguard measure. In the complainants' view, even 
though the Appellate Body answered the latter question in the affirmative, this does not mean that 
a Member is released from its obligation under Article 12.2 to submit all pertinent information prior 
to the entry into force of the  measure. A Member can comply with this obligation, for example, by 
notifying all pertinent information under Article 12.1(b).233  
7.5.6.2   Relevant law  
7.114.   Article  12.1 of the Agreement on Safeguard s requires Members to "immediately notify" the 
WTO Committee on Safeguar ds upon the occurrence of the following three 
"events"234: (a) initiating an investigatory process relating to serious injury or threat thereof 
(Article  12.1(a)); ( b) making a finding of serious injury or threat thereof ( Article  12.1(b)); 
and (c) taking a de cision to apply or extend a safeguard measure ( Article  12.1(c)).  
                                                
226 Indonesia's first written submission, paras. 240  and 241. 
227 Indonesia's first written submission, paras. 241  and 242; opening statement at the first meeting of 
the Panel, paras. 70 and 71 .  
228 Indonesia's first written submission, para. 234; opening statement at the first meeting of the Panel, 
para. 68; second written  submission, para. 132; and opening statement at the second meeting of the Panel, 
para. 7 7. 
229 Indonesia's second written subm ission, para. 132.  
230 Indonesia's opening statement at the first meeting of the Panel, paras. 67 -69; second written  
submission, paras. 130 and 131.  
231 Complainants' first written submission, paras. 5.165 -5.168; opening statement at the first meeting 
of the P anel, paras. 8.4 -8.7; response to Panel question No. 43; second written  submission, 
paras.  2.141 -2.146; and opening statement at the second meeting of the Panel, para. 8.1.  
232 Complainants' second written  submission, para. 2.154.  
233 Complainants' response to  Panel question No. 44; second written  submission, para. 2.150.  
234 Appellate Body Report, US – Wheat Gluten , para 102.  WT/DS490/ R • WT/DS496/R  
 
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  7.115.   Article  12.2 sets out the required content of the notifications that must be made pursuant 
to Articles  12.1(b) or 12.1(c). This provision reads, in relevant part, as follows:  
In making the no tifications referred to in paragraphs 1(b) and 1(c), the Member 
proposing to apply or extend a safeguard measure shall provide the Committee on 
Safeguards with all pertinent information, which shall include evidence of serious 
injury or threat thereof caus ed by increased imports, precise description of the 
product involved and the proposed measure, proposed date of introduction, expected 
duration and timetable for progressive liberalization.  
7.116.   Notifications made for purposes of Articles  12.1(b) and 12.1(c) m ust disclose "all pertinent 
information" , which includes evidence of serious injury or threat thereof caused by increased 
imports, a precise description of the product involved and the proposed measure, the proposed 
date of introduction, the expected durat ion of the measure and a timetable for progressive 
liberalization. These items are "mandatory components " of such notifications, constituting the 
minimum requirements that must be satisfied if a notification is to comply with Article  12.2.235 
7.117.   The "evidence  of serious  injury " that must be included in an Article  12.1(b) or 12.1(c) 
notification  has been interpreted to refer, " at a minimum, to the injury factors required to be 
evaluated under Article  4.2(a) ".236 Thus, "so far as evidence of serious injury or threat  thereof 
caused by increased imports is concerned, the relevant notification must include information about 
each of the eight factors listed in Article  4.2 that are required to be evaluated", including the rate 
and amount of the increase in imports of the product concerned in absolute and relative terms .237  
7.118.   Prior panels have interpreted Article  12.2 to impose an obligation to notify "all pertinent 
information" before  the associated safeguard measure enters into force  so that affected Members 
may consult on i t before it takes effect.238 However, in US – Wheat Gluten , the Appellate Body 
stated that Article  12.2 did not  prescribe  "when  notification s [under Article  12.1(c) ] must be 
made ", but rather, only " what detailed information must be contained in the notifica tions under 
Article  12.1(b) and 12.1(c)" .239 According to the Appellate Body , "timeliness under 12.1(c) is 
determined by whether a decision to apply or extend a safeguard measure is notified 
'immediately'".240 Thus, for the Appellate Body, whether an Article  12.1(b) or 12.1(c) notification 
satisfies the content requirements in Article  12.2 is a "separate question" which must be answered 
by examining whether the notification contains "all pertinent information" that is "specifically 
enumerated in Article  12.2".241 
7.5.6.3   Relevant facts  
7.119.   Indonesia submitted three notifications to the WTO Committee on Safeguards in relation to 
the challenged safeguard measure .  
7.120.   First, on 20 December 2012, Indonesia notified the initiation of the safeguard investigation 
into imports of galval ume pursuant to Article  12.1(a) of the Agreement on Safeguards . This 
notification was circulated to WTO Members on 8 January 2013.242  
7.121.   Second, on 26 May 2014, Indonesia notified , pursuant to Article  12.1(b) , that it had made 
a finding of serious injury or th reat of serious injury caused by increased imports of galvalume  
("notification of 26 May 2014"). This notification did not contain a precise description of the 
proposed measure, its proposed date of introduction, the expected duration and timetable for 
progressive liberalization, or information about the rate and amount of the increase in imports of 
                                                
235 Appellate Body Report, Korea – Dairy , para. 1 07. 
236 Appellate Body Report, Korea – Dairy , para. 1 08. 
237 Panel Report, Ukraine – Passenger Cars, para. 7.509.  
238 Panel Report s, Ukraine – Passenger Cars , para. 7.5 21; Korea – Dairy , para. 7.120; and US – Wheat 
Gluten , paras. 8.202, 8.205 , and 8.206.  
239 Appellate Body Report, US – Wheat Gluten , para. 123 . (emphasis original)  
240 Appellate Body Report , US – Wheat Gluten , para. 123.  
241 Appellate Body Report, US – Wheat Gluten , para. 123.  
242 WTO, Committee on Safeguards, Notification Under Article 12.1(a) of the Agreement on Safeguards 
on initiation of an investigation and the reasons for it, G/SG/N/6/IDN/ 22, (Exhibit TPKM/VNM -2). There are no 
issues in this dispute regarding this notification.  WT/DS490/R • WT/DS496/R  
 
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  the subject product relative to domestic production.  The notification did provide information with 
respect to the rate and amount of the increase in imports of the subject product relative to 
national consumption . The notification was circulated to WTO Members on 27 May 2014.243  
7.122.   Third, on 23 July 2014  (one day after the safeguard measure entered into legal effect) , 
Indonesia submitted one document intended to serv e as the following three separate and distinct 
notifications: ( a) a supplementary notification to Indonesia's Article  12.1(b) notification of 
26 May 2014; ( b) a notification pursuant to Article  12.1(c) disclosing that Indonesia had taken a 
decision to appl y a safeguard measure; and ( c) a notification pursuant to footnote 2 of Article  9 
concerning the exemption of developing countries from the scope of the safeguard measure in 
accordance with Article  9.1. One document constituting a ll three notifications w as circulated to 
WTO Members on 28 July 2014.244 This document reproduced the document submitted by 
Indonesia, and contained a precise description of the proposed measure, its proposed date of 
introduction, and information about the expected duration and timet able for progressive 
liberalization . It did not provide information with respect to the rate and amount of the increase in 
imports of the subject product relative to domestic production.   
7.123.   The Technical Cooperation Handbook on Notification Requirements issu ed by the WTO 
Committee on Safeguards envisages that where not all of the information required under 
Article  12.2 is available at the time of a "finding of serious injury or threat thereof" , a Member 
making an Article  12.1(b) notification should  indicate that the relevant information is "not 
available".245 A Note on the cover page of the Handbook explicitly states that it "does not 
constitute a legal interpretation of the notification obligations under the respective 
Agreement(s)".246 Indonesia's notification of 26 May 2014 did not include such language or any 
other explanation concerning the absence of the re quired information.   
7.5.7   Consultations  
7.5.7.1   Parties' arguments  
7.124.   The complainants claim that Indonesia  acted inconsistently with Article  XIX:2 of the 
GATT  1994 and Article 12.3 of the Agreement on Safeguards by failing to provide them with an 
adequate opportunity  for consultations  prior to the entry into force of the safeguard measure . 
According to the complainants, Indonesia failed to satisfy its obligations under both provisions  
because: (a)  Indonesia did not respond to Chinese Taipei's reque sts for consultations; 
(b) Indonesia did not respond quickly enough to Viet Nam's requests for consultations and, when it 
did, the consultation dates proposed were after the "stip ulation" date of the safeguard measure; 
and (c)  Indonesia failed to disclose to both Viet Nam and Chinese Taipei all of the information  
necessary to hold meaningful consultations  under the terms of Article  12.3.247 In addition, the 
complainants argue that In donesia's allegation that "critical circumstances" exist is not 
substantiated by any evidence, and that no consultations were held immediately after the entry 
into force of the measure.248 
7.125.   Indonesia argues that the facts demonstrate that the complainants wer e given an 
adequate opportunity to hold consultations within the meaning of Article  12.3. First, Indonesia 
recalls that all qualifying WTO Members were provided with an opportunity to hold consultations 
when it explicitly invited all such Members to consul tations in its notification to the WTO 
Committee on Safeguards of 26 May 2014, 56 days before the safeguard measure entered into 
                                                
243 Committee on Safeguards, Notification  Under Article 12.1(b) of the Agreement on Safeguards on 
finding a serious injury or threat thereof caused by increased import s, G/SG/N/8/IDN/16, 
(Exhibit  TPKM/VNM -3). 
244 Committee on Safeguards, Notification Under Articles 9, 12.1(b), and 12.1(c), and Footnote 2 of the 
Agreement on Safeguards (28 July 2014), G/SG/N/8/IDN/16/Suppl.1, G/SG/N/10/IDN/16/Suppl.1, 
G/SG/N/11/IDN/14, (Ex hibit TPKM/VNM -5). 
245 Technical Cooperation Handbook on Notification Requirements, Agreement on Safeguards, 
WT/TC/NOTIF/SG/1, 15 October 1996 (Technical Cooperation Handbook), part III – G/SG/1, p. 2.  
246 Technical Cooperation Handbook.  
247 Complainants' first  written submission, paras. 5.18 3-5.187; opening statement at the first meeting 
of the Panel, para. 8.7; second written  submission, paras. 2.162 -2.174; and opening statement at the 
second meeting of the Panel, paras. 9.1 -9.5. 
248 Complainants' opening statem ent at the second meeting of the Panel, para. 9.3.  WT/DS490/ R • WT/DS496/R  
 
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  force. Second, Indonesia asserts that KPPI responded to Viet Nam's requests to hold consultations 
in a timely manner, inviting its representatives to Jakarta on 8 and 10 July 2014. According to 
Indonesia, consultations could not be held on these dates and had to be postponed to 20 August 
and 27 October 2014 only because of Viet Nam's own internal administrative procedures. 
Indones ia states that it could not have postponed the implementation of the measure while it 
waited for Viet Nam to avail itself of the opportunity to consult, because of the "critical 
circumstances and the urgency of the safeguard measure".249 Indeed, according to  Indonesia, 
under Article XIX:2 of the GATT 1994, the alleged "critical circumstances" entitled it to impose a 
provisional  measure without  prior consultation, provided that consultations were held immediately 
afterwards.250 Third, Indonesia argues that in th e present situation, the only requests for 
consultations that were relevant for the purpose of Article  12.3 were those made after KPPI's 
determination of serious injury251, noting furthermore that in the case of Chinese Taipei, the only 
relevant request f or consultations was made on 24  October 2014 , long after the measure had 
actually entered into force.252  
7.126.   Finally , Indonesia argu es that its notification satisfied the standards of Article  12.2 and 
therefore rejects  the complainants' assertion that it was impos sible to hold meaningful 
consultations because of a lack of "pertinent information" in its Article  12.1(b) notification. In any 
case, Indonesia submits that consultations may be adequate even in circumstances where prior 
notifications are incomplete becaus e the purpose of consultations is to review the content of such 
notifications.253 
7.5.7.2   Relevant law  
7.127.   Article  XIX:2 of the GATT 1994 reads, in relevant part, as follows:  
Before any contracting party shall take action pursuant to the provisions of paragraph 
1 of thi s Article, it shall give notice in writing to the CONTRACTING PARTIES as far in 
advance as may be practicable and shall afford the CONTRACTING PARTIES and those 
contracting parties having a substantial interest as exporters of the product concerned 
an oppo rtunity to consult with it in respect of the proposed action. … In critical 
circumstances, where delay would cause damage which it would be difficult to repair, 
action under paragraph 1 of this Article  may be taken provisionally without prior 
consultation,  on the condition that consultation shall be effected immediately after 
taking such action.  
Article  12.3 of the Agreement on Safeguards  provides:  
 
A Member proposing to apply or extend a safeguard measure shall provide adequate 
opportunity for prior consul tations with those Members having a substantial interest 
as exporters of the product concerned, with a view to, inter alia , reviewing the 
information provided under paragraph 2, exchanging views on the measure and 
reaching an understanding on ways to achie ve the objective set out in paragraph 1 of 
Article  8. 
7.128.   Article  12.3 requires a Member proposing  to apply a safeguard measure to provide 
exporting Members with : (a) sufficient information ; and (b) time to allow for the possibility, 
through consultations, for  holding ( c) a meaningful exchange on the issues identified .254 
                                                
249 Indonesia's first written submission, paras. 256-260; opening statement at the first meeting of the 
Panel, paras. 74 and 75; second written  submission, paras. 137 and 138; and opening statement at the 
second meeting of the Panel, paras. 84 -89. 
250 Indonesia's first written submission, para. 267 ; second written  submission, para. 139; and opening 
statement at the second meeting of the Panel, para. 92.  
251 Indonesia's opening statement at the second meeting of t he Panel, para. 86. 
252 Indonesia's firs t written submission, para. 257; opening statement at the first meeting of the Panel, 
para. 76 ; and opening statement at the second meeting of the Panel, para. 89 . 
253 Indonesia's first written submission, para s. 262 and  263 (referring to Panel Report, Korea – Dairy , 
para. 7.150); opening statement at the first meeting of the panel, paras. 78 and 79; and opening statement at 
the second meeting of the Panel, para. 92.  
254 Appellate Body Report, US – Wheat Gluten , para. 136.  WT/DS490/R • WT/DS496/R  
 
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  Information on the "proposed  measure must be provided in advance  of the consultations, so that 
the consultations can adequately address that measure ".255  
7.129.   The information  that is needed to enable meaningful consultations to occur under 
Article  12.3 is set out in the list of "mandatory components" identified in Article  12.2.256 An 
exporting Member will not have been provided with an "adequate opportunity" to hold 
consultations under Article  12.3 unles s, prior to those consultations, it has obtained, inter alia , 
sufficiently detailed information  on the form of the proposed measure, including the nature of the 
remedy.257  
7.130.   The requirement to provide sufficient time  to allow for the possibility of a meaningf ul 
exchange has been interpreted to mean that exporting Members should obtain the relevant 
information sufficiently in advance to permit analysis of the measure, and consider the likely 
consequences of the measure before it takes effect .258 An importing Memb er's failure to provide 
relevant information sufficiently in advance of a safeguard measure taking effect is not excused by 
the fact that the exporting Member may not have request ed consultations  during that inadequate 
time-period.259 Moreover, the "prior co nsultations" envisaged by Article  12.3 need not be  with 
respect to a proposed measure that is identical, in every respect, to the one that is eventually 
applied.260 
7.131.   The meaningful exchange  that is called for under Article  12.3 "assumes that the importing 
Member will enter into consultations in good faith and will take the time appropriate to give due 
consideration to any comments received from exporting Members before implementing the 
measure ".261 
7.132.   Finally, Article  6 of the Agreement on Safeguards provides that  in "critical circumstances 
where delay would cause damage which it would be difficult to repair", a Member may impose a 
"provisional" safeguard measure , which must be based on a preliminary determination that 
increased imports have caused or are threatenin g to cause serious injury . A provisional safeguard 
measure may only take the form of a tariff increase, and may not last  more than  200 days.  During 
the duration of the provisional safeguard measure, the importing Member must comply with the 
relevant requir ements set out in Articles  2 to 7 and 12 of the Agreement on Safeguards. 
Article  XIX:2 of the GATT 1994 exempts an importing Member from the need to hold prior 
consultation s before applying a provisional safeguard measure whilst requiring it to hold such 
consultation s immediately after imposing it.  
7.5.7.3   Relevant facts  
7.133.   The challenged safeguard investigation was initiated on 19 December 2012. A public 
hearing was held on 23 April 2013. During the entire investigation, the only document that KPPI 
sent to the expor ters of Chinese Taipei and Viet Nam was the non -confidential version of the 
Petition.262 
7.134.   Viet Nam sent a letter dated 24 April 2014  to KPPI , recalling Indonesia's notification 
obligations under Articles  12.1 and 12.2  and requesting KPPI to disclose "the pert inent information 
… once [KPPI's] findings have been made prior to any final determination during the course of the 
investigation".263 The same letter also reminded KPPI of its obligation under Article  12.3 to hold 
"pre-consultation[s] with … the Vietnam Gov ernment prior to the final determination of KPPI with a 
                                                
255 Appellate Body Report, US – Wheat Gluten , para. 136 . (emphasis original)  
256 Appellate Body Report, US – Wheat Gluten , para. 136.  
257 Appellate Body Report, US – Wheat Gluten , para. 13 7. 
258 Appellate Body Report, US – Line Pipe , para. 108 ; and Panel Report, Ukraine – Passenger Cars , 
para. 7.534.  
259 Appellate Body Report, US – Line Pipe , para. 112.  
260 Appellate Body Report, US – Line Pipe , para. 10 4. 
261 Appellate Body Report, US – Line Pipe , para. 1 10. (fn omitted ) 
262 Request for Application of Safeguard Measure ( Non-confidential Summary), 12 December 2012, 
(Exhibit TPKM/VNM -11). 
263 Letter dated 24 April 2014 from Viet Nam to KPPI, (Exhibit TPKM/VNM -6). WT/DS490/ R • WT/DS496/R  
 
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  view to, inter alia , reviewing the information provided under [Article  12.2, and] exchanging views 
on the measure" .264  
7.135.   In its Article  12.1(b) notification of 26 May 2014, Indonesia indicated that it wa s "prepared 
to consult with those Members having a substantial interest as exporters of the products 
concerned".265 At the time, Viet Nam possessed a copy of the Final Disclosu re Report, which it had 
received from the Hoa Sen Group on 23 May 2014.266 The Hoa S en Group obtained the Final 
Disclosure Report on 20 May 2014267, some  two months after it had been issued, in response to its 
request of 22 April 2014 for the "disclosure of non -confidential information".268  
7.136.   Viet Nam sent two letters to KPPI on 16 and 30 June  2014, which stated that Viet Nam 
was ready to communicate with KPPI in relation to the safeguard investigation and explicitly 
requested consultations under Article  12.3.269 Indonesia responded to Viet Nam's letters on 
4 July 2014, inviting Viet Nam to Jakar ta to hold consultations on 8 July 2014.270 However, 
Viet Nam could not attend consultations on "such short notice"  due to "strict internal procedures 
for approval".271 By letter of 7 July 2014, Viet Nam requested that an alternative date be agreed 
and that it  was "looking forward to receiving a formal and original confirmation letter" from 
KPPI.272  
7.137.   On the same day, Indonesia replied proposing  a meeting on 10 July 2014.273 Viet Nam 
responded on 8 July 2014 specifying that it could not meet on 10 July for the same reasons as 
before. Viet Nam explained that "our strict procedures for approval of overseas trip" requires "a 
formal and original letter" from KPPI via post.274 KPPI responded by letter of 10 July in which it 
stated that "we sent you the official invitation l etters by fax and e -mail".275  
7.138.   Viet Nam sent KPPI another letter on 17 July 2014 requesting that consultations be held on 
31 July 2014, recalling Indonesia's obligations under Article  12.3.276 Six days later, on 
23 July 2014, Viet Nam sent another letter to KP PI protesting about the lack of response to its 
latest request for consultations, noting that the safeguard measure had already come into force 
and that the Minister for Finance had "stipulated" the regulation imposing the safeguard measure 
on 7 July – i.e. one day before th e date originally suggested by KPPI to hold consultations with 
Viet Nam.277 Viet Nam claimed that Indonesia's conduct violated Article  12.3. 
7.139.   Indonesia responded to Viet Nam's 23 July letter on 25 July, revealing that it had not 
received Vi et Nam's letter of 17 July requesting consultations until the same day that it received 
the letter of 23 July. Indonesia informed Viet Nam that due to Eid Mubarak holidays government 
offices would be closed on 31 July, and proposed that consultat ions could  be held instead on 
4 August  2014.278 Viet Nam responded by letter of 4 August 2014, in which it requested that 
consultation s be held on 20 August 2014.279 Indonesia confirmed  this proposed date on 
7 August  2014.280 Consultations were held on 20 August 2014 , and a second round of 
consultations took place between KPPI and Viet Nam on 27 October 2014.281 
                                                
264 Letter dated 24 April 2014 from Viet Nam to KPPI, (Exhibit TPKM/VNM -6). 
265 Committee on Safeguards, Notification  Under Article 12.1(b) of the Agreement on Safeguards on 
finding a serious injury or threat thereof caused by increased imports, G/SG/N/8/IDN/16, 
(Exhibit  TPKM/VNM -3), section H, para. 3.  
266 Complainants' response to Panel question No. 45.  
267 Email dated 20 May 2014 from KPPI to Hoa Sen Group's counsel, (Exhibit TPKM/VNM -18). 
268 Letter dated 22 April 2014 from Hoa Sen Group's counsel to KPPI, (Exhibit TPKM/VNM -16). 
269 Letter dated 16 June 2014 from Viet Nam to KPPI, (Exhibit TPKM/VNM -7); and Letter dated 
30 June 2014 from Viet Nam to KPPI, (Exhibit TPKM/VNM -8). 
270 Letter dated  4 July 2014 from KPPI to Viet Nam, (Exhibit IDN -15). 
271 Letter dated 7 July 2014 from Viet Nam to KPPI, (Exhibit IDN -16). 
272 Letter dated 7 July 2014 from Viet Nam to KPPI, (Exhibit IDN -16). 
273 Letter dated 7 July 2014 from KPPI to Viet Nam, (Exhibit IDN -17). 
274 Letter dated 8 July 2014 from Viet Nam to KPPI, (Exhibit IDN -18). 
275 Letter dated 10 July 2014 from KPPI to Viet Nam, (Exhibit IDN -19). 
276 Letter dated 17 July 2014 from Viet Nam to KPPI, (Exhibit IDN -21). 
277 Letter dated 23 July 2014 from Viet Nam to KPPI, (Exhibit IDN -23). 
278 Letter dated 25 July 2014 from KPPI to Viet Nam, (Exhibit IDN -24). 
279 Letter dated 4 August 2014 from Viet Nam to KPPI, (Exhibit IDN -25). 
280 Letter dated 7 August 2014 f rom KPPI to Viet Nam, (Exhibit IDN -26). 
281 Indonesia's first written submission, para. 255.  WT/DS490/R • WT/DS496/R  
 
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  7.140.   Chinese Taipei requested Article  12.3 consultations on 30 April 2013 , during the course of 
KPPI's investigation282, after having reminded KPPI of its "pre -consultation s" obligations under 
Article  12.3 on 11  January 2013.283 Chinese Taipei also requested Article  12.3 consultations at a 
meeting of the Committee on Safeguards of 22 October 2013.284 KPPI did not specifically contact 
Chinese Taipei following its requests for con sultations,  and Chinese Taipei did not subsequently 
approach KPPI or any other Indonesia n government entity  again after 22 October 2013  to request 
consultations . Chinese Taipei obtained the Final Disclosure Report on 7 October 2014 after 
requesting it on 6  October 2014, more than six months after it had been issued.285  
7.141.   There is no evidence that KPPI adopted a "provisional safeguard" within the meaning of 
Article XIX:2 of the GATT 1994 or Article  6 of the Agreement on Safeguards, or that such a 
measure, assum ing arguendo  that it ever actually existed, was justified on the basis of "critical 
circumstances".  
8  CONCLUSIONS AND RECO MMENDATIONS  
8.1.   For the reasons set out in this Report, we conclude as follows:  
a. the specific duty  applied by Indonesia on imports of galval ume by means of Regulation 
No. 137.1/PMK.011/2014 does not constitute a safeguard measure within the meaning 
of Article  1 of the Agreement on Safeguards ; and  
b. the application of the specific duty on imports of galvalume  originating in all but the 
120 countr ies listed in Regulation No. 137.1/PMK.011/2014  is inconsistent  with 
Indonesia's obligation to afford MFN -treatment under Article  I:1 of the GATT 1994.  
8.2.  Having concluded that the specific duty does not constitute a safeguard measure within the 
meaning of Ar ticle 1 of the Agreement on Safeguards, there is no legal basis  to support the 
complainants' claims under the Agreement on Safeguards and the GATT 1994 with respect to the 
specific duty as a safeguard measure . Accordingly, we dismiss the entirety of those claims.  
8.3.  Under Article  3.8 of the DSU, in cases where there is an infringement of the obligations 
assumed under a covered agreement, the action is considered prima facie  to constitute a case of 
nullification or impairment. Thus, to the extent that we have found the measures at issue to be 
inconsistent with Article  I:1 of the GATT 1994 , they have nullified or impaired benefits accruing to 
Chinese Taipei and Viet Nam under that agreement.  
8.4.  The complainants have requested that were we to confirm the full extent  of their complaint 
against the specific duty as a safeguard measure , we should go on to exercise the discretion 
accorded to panels under Article  19.1 of the DSU and suggest that Indonesia bring its safeguard 
measure into conformity with its WTO obligation s by immediately withdrawing it.286 Having found 
that there is no legal basis to support the complainants' claims against the specific duty as a 
safeguard measure , there is no need to consider the complainants' request. Accordingly, in the 
light of our findi ng that the application of the specific duty is inconsistent with Indonesia's 
obligations under Article  I:1 of the GATT 1994, we recommend , pursuant to Article  19.1 of the 
DSU, that Indonesia bring its measure  into conformity with its obligations under the  GATT 1994 . 
__________  
 
 
                                                
282 Letter s dated 11 January 2013  and 30 April 2013  from Chinese Taipei to KPPI, 
(Exhibit  TPKM/VNM -14). 
283 Letter s dated 11 January 2013  and 30 April 2013 from Chinese Taipei to KPPI, 
(Exhibit  TPKM/VNM -14). 
284 Committee on Safeguards, Minutes of the regular meeting held on 22 October 2013, circulated 
27 March 2014, G/SG/M/44, (Exhibit TPKM/VNM -34), para. 53.  
285 Email exchange dated 6 and 7 October 2014  between Chinese Taipei and KPPI, 
(Exhibit  TPKM/VNM -17). 
286 Complainants' opening statement at the first meeting of the Panel, para. 9.3; second written  
submission, para. 3.2; and opening statement at the second meeting of the Panel, paras. 10.1 -10.3.