G/SG/Q2/EGY/14
16 April 2015
(15-2047)  Page: 1/2
Committee on Safeguards  Original: English
 
NOTIFICATION UNDER ARTICLE 12.1(A) OF THE AGREEMENT 
ON SAFEGUARDS ON INITIATI ON OF AN INVESTIGATION 
AND THE REASONS FOR IT 
 
NOTIFICATION UNDER ARTICL E 12.4 OF THE AGREEMENT 
ON SAFEGUARDS BEFORE TAKING A PROVISIONAL 
SAFEGUARD MEASURE REFERRED TO IN ARTICLE 6 
QUESTIONS POSED BY UKRAINE  
REGARDING THE NOTIFICATION OF EGYPT1 
(Steel Rebar) 
The following communication, dated 10 April 2015, is being circulated at the request of the 
Delegation of Ukraine. 
_______________ 
 
 On 14 October 2014, the Arab Republic of Egypt initiated a safeguard investigation on Steel Rebar 
(G/SG/N/6/EGY/10). 
 On 14 October 2014, the Arab Republic of Egypt informed Committee on Safeguards about application of the provisional safeguard measure in the form of additional duty of 7.3 per cent of 
the CIF value and not less than 290 L.E/ton (G/SG/N/7/EGY/9). 
 Question 1 
 
Egypt imposed provisional safeguard measures on Steel Rebar on 02/12/2012. These duties expired on 19/6/2013 after the investigating authority had concluded that there was no threat to 
the domestic industry. Thus, safeguard measures were in force during 200 days and could not be 
imposed again for at least two years according to Article 7.5 of the Agreement on Safeguards. However, on 14/10/2014 Egypt imposed provisional safeguard measures on Steel Rebar. Thus, the non-application period was less then two years. 
 
Allegations of the investigating authority that Article 7.5 concerns definitive safeguard measures and not provisional ones are unfounded. Article 7.5 of the Agreement on Safeguards does not 
differentiate between definitive safeguard measur es and provisional. Thus, both definitive and 
provisional measures can be considered as provided for by this article.   
Would Egypt please explain on what grounds safeguard measures were imposed on 14/10/2014 
taking into account the provisions of Article 7.5 of the Agreement on Safeguards.  Question 2 
 
On 14/10/2014 a notification was sent to the WTO, and on the same date the decree on the imposition of duties started to apply, which is deemed a procedural violation of the Agreement on 
Safeguards stating that the WTO shall be notified before the introduction of duties. 
 
                                               
1 G/SG/N/6/EGY/10–G/SG/N/ 7/EGY/9–G/SG/N/11/EGY/8. G/SG/Q2/EGY/14 
 
- 2 - 
 
  Allegations of the investigating authority that th e provisions of Article 12.4 of the Agreement on 
Safeguards do not identify a specif ic period for the word "before" and that a notification concerning 
the decree on the imposition of safeguard measures was sent to the Committee on Safeguards "before the imposition of duties on the same da y" seems to be not serious. Imposition of the 
measures on 14/10/2014 does not mean that it was not in force before notification was sent to the 
Committee on Safeguards on the same date.  
Obviously, Egypt violated Article 12.4 of the Agreement on Safeguards by introducing safeguard 
measures on 14/10/2014.  Would Egypt please identify what specific steps will be taken in the future to insure that such 
delays will not occur again? 
 Question 3 
 
Provisional safeguard measures were imposed without prior investigation which is inconsistent with the provisions of Article 3.1 of  the Agreement on Safeguards. 
 
Allegations of the investigating authority that the measures were applied once a positive evidence that the substantial increase in imports had caused serious injury to the domestic industry was found is not convincing. The investigation was initiated on 13/10/2014 and measures were 
introduced on 14/10/2014.  
 Would Egypt please explain how the investigating authority managed to make the whole analysis 
of imports evolution and injury situation in one day? 
 Question 4 
 
Pursuant to Article 12.4 of the Agreement on Safeguards: 
 
"A Member proposing to apply or extend a safeguard measure shall provide adequate 
opportunity for prior consultations with those Members having a substantial interest". 
Would Egypt please explain why such consultations were not provided before the introduction of 
the provisional measures? 
 
Question 5  
According to information provided in the report of the investigating authority there was a decrease 
in imports in 2013 by 20% as compared to 2011 and by 64% as compared to 2012. Thus there is no year by year recurrence in imports increase as it is required by WTO rules.  
Pursuant to paragraph 131 of the Appellate Body Reports on Argentina — Footwear (EC) :  
 
"… it is not enough for an investigation to show simply that imports of the product this 
year were more than last year – or five years ago.  Again, and it bears repeating, 
not just  any  increased quan tities of imports will suffice ." 
Along with this, there was no significant overall impairment in the position of the domestic industry 
in 2010-2014, since most factors of the domestic industry actually had positive trends. There was 
an increase of production by 32% in January-S eptember 2014 as compared to the same period 
of 2011. Moreover, there was an increase in dome stic sales by 25% in January-September 2014 
as compared to the same period of 2011.  
Given the fact that in 2013 there was decline in profits by 12% at the same period as imports 
decreased by 20%, it is obvious that imports did not influence domestic industry. Thus, there were 
factors other than increased imports that caused injury to the domestic industry at the same time. 
Injury made by these factors shall not be attributed to increased imports according to 
Article 4.2(b) of the Agreement on Safeguards.  
Taking into account foregoing facts would Egypt please explain how the provisional measures on 
steel rebar comply with Articles 2.1, 4.1 (a), 4.2(b) and 6 of the Agreement on Safeguards? 
__________