WT/DS402/R 
 Page B-1 
 
 
  
ANNEX B 
 
 
THIRD PARTIES' WRITTEN SUBMISSIONS OR 
EXECUTIVE SUMMARIES THEREOF 
 
 
Contents Page 
Annex B-1 Third Party Written Submi ssion of the European Union B-2 
Annex B-2 Third Party Written Submission of Japan B-5 
 
 WT/DS402/R 
Page B-2  
 
  
ANNEX B-1 
 
 
THIRD PARTY WRITTEN SUBMISSION 
OF THE EUROPEAN UNION 
 
 
1. The European Union makes this third part y written submission because of its systemic 
interest in the correct and consistent  interpretation and application of the Agreement on 
Implementation of Article VI of the Ge neral Agreement on Tariffs and Trade 1994  (the "Anti-
Dumping Agreement") and the Dispute Settlement Understanding  ("DSU").  
 
2. The European Union considers that there is no dispute before the parties as to the relevant 
facts of the case, the interpretation of the relevant law and its application to the facts.  Indeed, as 
regards the facts  of this case, according to the United States, "[it] does not contest the accuracy of 
Korea's description of the zeroing methodology set fo rth in paragraphs 4 a nd 17 of Korea's First 
Written Submission, as it relates to the inv estigations challenged in this dispute".1  As regards the 
evidence  submitted by Korea to prove its case, the Un ited States notes that "[it] has reviewed the 
factual evidence submitted by Korea and does not c ontest that the submitted documentation, including 
the computer programs used to calculate the dumpi ng margins, were generate d by the Department of 
Commerce during its conduct of the three original investigations at issue".2  Finally, with respect to 
the interpretation of the relevant provisions of the Anti-Dumping Agreement  and its application to the 
facts of this case , the United States confirms that "[it] acknowledges that [the reasoning of the 
Appellate Body in US – Softwood Lumber Dumping , which found that the use of "zeroing" with 
respect to the average-to-average comparison methodol ogy in investigations was inconsistent with the 
first sentence of Article 2.4.2] is equally appli cable to the margins at issue in this dispute".3  
 3. Under these circumstances, once the Panel h as outlined the agreement of the parties on all 
those issues (i.e., the facts, the interpretation of th e relevant law and the application of the law to the 
facts), the report of the Panel could be limited to ma king the finding that the parties agree that there is 
no dispute, and then recommend that the United Stat es bring the measures at issue into conformity 
with its obligation under the covered agreements.  In fact, in view of  the circumstance s of this case, 
where the United States has acknowledged that its measures are inconsistent with the Anti-Dumping 
Agreement , the European Union considers that the Pane l could make use of the possibility of making 
suggestions under Article 19.1 of the DSU,  and suggest that the United States should bring the 
measures at issue into conformity immediately.      4. This approach would be in accordance with Article 11 of the DSU .  A panel has a basic 
obligation under Article 11 of the DSU  to make an objective assessment of the matter before it.  Such 
assessment should include the f acts, evidence and legal argument.  Indeed, the Panel would 
distinguish between a finding that the parties agree w ith respect to a particular fact, evidentiary matter 
or legal issue; and the panel itself making such finding or recommendation.  5. To the extent that there is no dispute between the parties, the European Union recalls that the 
prompt settlement of disputes is essential to the effective functioning of the WTO and the 
maintenance of a proper balance between the rights a nd obligations of the Members; that all Members 
have agreed to engage in DSU  procedures in good faith in an effort  to resolve disputes; and that all 
                                                     
 
1 US First Written Submission, para. 5. 
2 US First Written Submission, para. 9. 
3 US First Written Submission, para. 10.  WT/DS402/R 
 Page B-3 
 
 
 Members undertake to accord sympathetic consid eration to representations made by any other 
Member.4 In order to ensure a prompt settlement of the dispute, the European Union considers that the 
Panel could adapt its working procedures in view of the agreement by the parties and stop its proceedings once it has received the views of the thir d parties.  In other words, the European Union 
considers that, in view of the US acknowledgmen t of the correctness of the facts, evidence, 
interpretation of the relevant law and its applicati on to the facts of this case, there is no need for a 
hearing, questions from the Panel or subsequent subm issions from the parties.  This would also be in 
line with the requirement of making "the procedures  more efficient" as contained in Article 12.8 of 
the DSU .  
 
6. Finally, the European Union wants to comment  on the US position with respect to prior panel 
and Appellate Body reports.  The United States c onsiders that the rights and obligations of WTO 
Members flow, not from panels or the Appellate Bo dy, but from the text of the covered agreements, 
and requests that this Panel make an objective assessment of the matter before it.
5  The European 
Union observes that panels and the Appellate Bo dy have found the use of zeroing in original 
investigations to be inconsiste nt with Article 2.4.2 of the Anti-Dumping Agreement in many disputes 
so far.6  The European Union notes that the Appellate Body Report in US-Stainless Steel  (Mexico)  
addresses in general terms the relevance of previous panel and Ap pellate Body reports.7 In particular, 
the Appellate Body clarified the role of its previ ous reports and indicated how panels should act in 
cases where the same legal issues arise:8 
 
[T]he legal interpretation embodied in adopt ed panel and Appellate Body.  Ensuring 
"security and predictability" in the disput e settlement system, as contemplated in 
Article 3.2 of the DSU, implies that, absent cogent reasons, an adjudicatory body 
will resolve the same legal question in the same way in a subsequent case .  
In the hierarchical structure contemplated in the DSU, panels and the Appellate Body 
have distinct roles to play.  In order to strengthen dispute settlement in the 
multilateral trading system, the Uruguay R ound established the Appellate Body as a 
standing body.  Pursuant to Article 17.6 of the DSU, the Appellate Body is vested with the authority to review "issues of law covered in the pa nel report and legal 
interpretations developed by the panel".  Accordingly, Article 17.13 provides that the 
Appellate Body may "uphold, modify or re verse" the legal findings and conclusions 
of panels.  The creation of the Appellate Body by WTO Members to review legal 
interpretations developed by  panels shows that Members recognized the importance 
of consistency and stability in the interpre tation of their rights and obligations under 
the covered agreements.  This is essential to promote "security and predictability" in 
the dispute settlement system, and to ensu re the "prompt settlement" of disputes.  The 
Panel's failure to follow previously adopted  Appellate Body reports addressing the 
same issues undermines the development of a coherent and predictable body of jurisprudence clarifying Members' ri ghts and obligations under the covered 
agreements as contemplated under the DSU .  Clarification, as envisaged in 
                                                     
 
4 DSU , Article 3.3, 3.10 and 4.2. 
5 US First Written Submission, para. 11. 
6 See Appellate Body Report, EC – Bed Linen , para. 66; Appellate Body Report, US – Softwood 
Lumber V , para. 117; Appellate Body Report, US – Softwood Lumber V (Article 21.5 – Canada) , para. 124; 
Appellate Body Report, US – Zeroing (Japan) , para. 138; and Appellate Body Report, US – Zeroing (EC) , 
para. 222.  In addition, model zeroing in original investigations has been found to be inconsistent with Article 2.4.2 of the Anti-Dumping Agreement by all panels that have examin ed that practice, including the 
panels in EC – Bed Linen , EC – Tube or Pipe Fittings , US – Softwood Lumber V , US – Zeroing (EC) , US – 
Zeroing (Japan) , and US – Shrimp (Ecuador) , US – Shrimp (Thailand)  and US – Continued Zeroing . 
7 Appellate Body Report, US – Stainless Steel (Mexico) , paras. 157 – 162. 
8 Appellate Body Report, US - Stainless Steel from Mexico , paras. 160 – 162 (emphasis added). WT/DS402/R 
Page B-4  
 
 Article 3.2 of the DSU, elucidates the scope and meaning of the provisions of the 
covered agreements in accordance with cu stomary rules of interpretation of public 
international law.  While the application of a provision may be regarded as confined 
to the context in which it takes place, the relevance of clarification contained in 
adopted Appellate Body reports is not lim ited to the application of a particular 
provision in a specific case .  
We are deeply concerned about the Panel' s decision to depart from well-established 
Appellate Body jurisprudence clarifying th e interpretation of the same legal issues. 
The Panel's approach has serious implica tions for the proper functioning of the WTO 
dispute settlement system, as explained above. 
7. The European Union fully agrees with these stat ements without reservation.  In this respect, 
the final sentence of paragraph 160 refers to "an ad judicatory body" (in the singular), which seems to 
indicate that the phrase refers to the situation in wh ich it is the same body in both the previous case 
and the case to be decided.  That is, it refers to the situation in which a panel might be called upon to 
resolve the same legal issue that it has previously resolved; or the situation in which the Appellate 
Body might be called upon to resolve the same legal issue that it has already resolved.  We note that 
the phrase refers to "cogent reasons" as the basis for a change in view.  By contrast, the European 
Union notes that paragraph 161 of the Appellate Body Report in US – Stainless Steel (Mexico)  
addresses the hierarchical relationship between panels  and the Appellate Body.  It concludes that the 
relevance of clarification provided by the Appella te Body on issues of legal interpretation is not 
limited to the application of a particular provision in a specific case.  There is no express reference to 
"cogent reasons".  Finally, in paragr aph 162 of the Appellate Body Report in US – Stainless Steel 
(Mexico)  the Appellate Body states that it was deeply concerned about the panel's decision to depart 
from well-established Appellate Body jurisprudence cl arifying the interpretation of the same legal 
issues.  
8. In other words, WTO panels are obliged to co rrectly apply the law; in the context of this 
dispute this also means that the Panel should follow the rulings of the Appellate Body where the Appellate Body has previously interpreted the sa me legal questions.  Otherwise, the security and 
predictability enshrined in Article 3.2 of the DSU  would be put in serious danger.   
 9. In sum, the European Union considers that, to  the extent that the Panel wants to make an 
independent finding about the interpretation of the re levant law and its application to the facts, the 
Panel should follow previous Appellate Body's reports  on the same legal issue, and consequently find 
that the USDOC's use of zeroing in the original i nvestigations challenged by  Korea is inconsistent 
with Article 2.4.2 of the Anti-Dumping Agreement.   
  WT/DS402/R 
 Page B-5 
 
 
  
ANNEX B-2 
 
 
THIRD PARTY WRITTEN SUBMISSION OF JAPAN 
 
 
1. This dispute is one of the numerous di sputes brought to the WTO dispute settlement 
procedure concerning "zeroing" used in the Unite d States' anti-dumping procedures.  Japan, as shown 
by its own recourse to the WTO dispute settlement pro cedure, has an interest in the issue of the WTO-
consistency and implementation by th e United States regarding "zeroing". 
 2. The basis of claim by the Republic of Korea (" Korea") is that the United States Department of 
Commerce's use of "zeroing" when calculating the dum ping margins for certain investigated exporters 
in the investigation of three products from Korea is inconsistent with the United States' obligations 
under Article 2.4.2 of the  Agreement of Implementation of Article VI of the GATT 1994  (Anti-
Dumping Agreement ).
1  Japan totally supports the Korea's claim.  Japan shares the same recognition 
with both parties that in US – Softwood Lumber Dumping the Appellate Body found that the use of 
"zeroing" in calculating margins of dumping on the basis of a comparison of a weighted average 
normal value with a weighted average of prices of all comparable export transactions (the "weighted-
average-to-weighted-average methodology") in investig ations was inconsistent with Article 2.4.2 of 
the Anti-Dumping Agreement .2 
 3. Japan notes that the United States does not  contest that the submitted documentation by 
Korea, including the computer programs used to cal culate the dumping margins, was generated by the 
United States Department of Commerce during its c onduct of the three original investigations at 
issue.
3  In addition, it should be noted that the Un ited States also acknowledged that the reasoning 
shown in US – Softwood Lumber Dumping was equally applicable to th e Korea's claim in this case.4 
 
4. In this regard, Japan recalls that the Unit ed States acknowledged that the reasoning shown in 
US – Softwood Lumber Dumping was equally applicable to US – Shrimp (Ecuador) and US – AD 
Measures on PET Bags.   In these cases, the panels correctly concluded the measures of the use of 
"zeroing" in calculating margins of dumping on the basis of the "weighted-average-to-weighted-average methodology" were inconsistent with Article 2.4.2 of the Anti-Dumping Agreement .
5 
 
5. In light of the foregoing, Japan agrees with the request of Korea that the Panel should find 
that the United States acted inconsistently w ith the requirement of Article 2.4.2 of the Anti-Dumping 
Agreement .  Japan expects that the United States would take appropriate actions with respect to 
measures at issue so that "promp t settlement of situations", as stated in Article 3.3 of the 
Understanding on Rules and Procedures Governing the Settlement of Disputes , will be achieved. 
                                                      
1 First Written Submission of Korea, para. 2. 
2 Appellate Body Report, US – Softwood Lumber Dumping , paras. 62-117, First Written Submission of 
Korea, para. 18. 
3 First Written Submission of The United States, para. 9. 
4 First Written Submission of The United States, para. 10. 
5 Panel Report, US – Shrimp (Ecuador) , para.8.1, Panel Report, US – AD Measures on PET Bags , 
para. 8.1.