WT/DS350/R 
 Page D-1 
 
 
  ANNEX D 
 
 
ORAL STATEMENTS OF  THE PARTIES AND TH IRD PARTIES AT THE 
FIRST AND SECOND MEET INGS OF THE PANEL 
 
 
Contents Page 
Annex D-1 Opening Statement of the United States at the First Meeting of the 
Panel D-2 
Annex D-2 Opening Statement of the European Communities at the First 
Meeting of the Panel D-10 
Annex D-3 Closing Statement of the United States at the First Meeting of the 
Panel D-15 
Annex D-4 Closing Statement of the European Communities at the First 
Meeting of the Panel D-18 
Annex D-5 Third Party Oral Statement of  Brazil at the First Meeting of the 
Panel D-20 
Annex D-6 Third Party Oral Statement of India at the First Meeting of the 
Panel D-25 
Annex D-7 Third Party Oral Statement of Japan at the First Meeting of the 
Panel D-26 
Annex D-8 Third Party Oral Statement of Korea at the First Meeting of the 
Panel D-28 
Annex D-9 Third Party Oral Statement of Mexico at the First Meeting of the 
Panel D-30 
Annex D-10 Third Party Oral Statement of Norway at the First Meeting of the 
Panel D-34 
Annex D-11 Third Party Oral Statement of the Separate Customs Territory of 
Taiwan, Penghu, Kinmen and Matsu at the First Meeting of the Panel D-37 
Annex D-12 Opening Statement of the European Communities at the Second 
Meeting of the Panel D-39 
Annex D-13 Opening Statement of the United States at the Second Meeting of 
the Panel D-40 
Annex D-14 Closing Statement of the European Communities at the Second 
Meeting of the Panel D-49 
Annex D-15 Closing Statement of the United States at the Second Meeting of 
the Panel D-50 
 
  WT/DS350/R 
Page D-2  
 
  ANNEX D-1 
 
 
OPENING STATEMENT OF THE UNITED STATES AT  
THE FIRST MEETING OF THE PANEL 
 
 
Mr. Chairman, Members of the Panel:   
 1. On behalf of the United States delegation, I would like to thank you for agreeing to serve on 
the Panel.  We do not intend to offer a lengthy statement, as our first written submission responds 
thoroughly to the substantive arguments that the European Communities ("EC") raised in its first 
written submission.   
 
2. As an initial matter, the United States would like to thank the Panel for agreeing to open the 
Panel's meetings to the public, including opening the th ird party session for those third parties willing 
to make their statements public.  The Panel pr operly recognized that under the Dispute Settlement 
Understanding ("DSU") it has the authority to modi fy the working procedures and to organize open 
sessions.  Opening this meeting to the public will have a positive impact on the perception of the 
WTO dispute settlement system, particularly with respect to transparency.  This dispute has a 
substantial public interest.  Perm itting the public to observe proceedings  and be able to see first-hand 
the professional, impartial, and objective manner in which they are conducted can only further 
enhance the credibility of the WTO.    
3. Today in our statement we would like to focus on a few points concerning the EC's argument.  
First, we will offer some comments on the applicable standard of review and the EC's argument concerning Article XVI:4 of the WTO Agreement.  Second, we will briefly discuss the proper scope 
of this dispute and the US requests for preliminary ru lings.  Third, we will refute the EC's claim that 
the text of the Antidumping Agreement establishes an obligation to provide an offset for non-dumped 
transactions in assessment proceedings.   
 
Standard of Review  
 
4. Article 11 of the DSU generally defines a pane l's task in reviewing the consistency with the 
covered agreements of measures taken by a Me mber.  In a dispute involving the Antidumping 
Agreement, a panel must also take into account the st andard of review set fort h in Article 17.6(ii) with 
respect to various permissible interpretations of a provision of the Antidumping Agreement.   
 5. The question under Article 17.6(ii) is whether an investigating authority's action rests upon a 
permissible interpretation of the Antidumping Agreem ent.  Article 17.6(ii) confirms that there are 
provisions of the Agreement that "admit[] of more th an one permissible interpretation".  Where that is 
the case, and where the investigating authority's actio n rests upon one such interpretation, a panel is to 
find that interpretation to be in conformity with the Agreement.
1   
 6. Under DSU Article 11, this Panel is char ged with making an objective assessment of the 
matter before it, including an objective assessment of  the facts and the conformity of the challenged 
measures with the relevant covered agreements.  Ho wever, the EC and certain third parties would like 
this Panel to neglect its expr ess obligation under Article 11 of the DSU to conduct an objective 
assessment.    
                                                     
 
1 See Argentina – Poultry , para. 7.341 and n. 223.    WT/DS350/R 
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  7. Instead, those Members urge the Panel to foll ow prior Appellate Body findings in order to 
ensure the "security and predictab ility" referred to in Article 3.2 of the DSU.  However, Article 3.2 
does not impose on panels an obligation to create secu rity and predictability.  Rather, Article 3.2 
explains that the dispute settlement system is a cen tral element in providing security and predictability 
to the multilateral trading system.  That only occu rs, however, when panels and the Appellate Body 
comply with the provisions of Articles 3.2 and 19 .2 of the DSU – that is, when they do not create 
rights and obligations to which the Members did not agree.    8. The EC's approach would result in undermining the very security and predictability to which 
the EC pays lip service.  For the EC, it would be enough for a panel to rely uncritically upon a prior 
Appellate Body report.  The EC, in essence, woul d like this Panel to rubber-stamp those reports 
favourable to its position.  Fortunately for the di spute settlement system, panels and the Appellate 
Body have refused to embrace the approach urged by the EC.    9. Two panels have expressly rejected allega tions that they were bound by Appellate Body 
conclusions, most recently in US – Zeroing (Mexico) .  That panel, like the US – Zeroing (Japan) 
panel, was not convinced.  According to the US – Zeroing (Mexico)  panel, in light of its "obligation 
under Article 11 of the DSU to carry out an objective examination of the matter referred to us by the 
DSB", the panel "felt compelled to depart from the Appellate Body's previous approach" to claims 
against so-called "zeroing" in administrative reviews.
2  Similarly, the panel in the dispute 
United States – Anti-dumping Measure on Shrimp from Ecuador  re-affirmed the need for a panel to 
take seriously its obligations under DSU Article 11 to conduct an objective assessment and to hold a 
complaining party to its burden of proof even where the responding party did not contest the complaining party's claims.  And it is ironic that wh ile the EC urges the Panel to treat past Appellate 
Body reports as being definitive interpretations of  the covered agreements, the EC ignores the very 
findings of the Appellate Body on the issue of the eff ect to be given to prior Appellate Body reports.  
In Japan – Taxes on Alcoholic Beverages , the Appellate Body explained:   
 
We do not believe that the CONTRACTI NG PARTIES, in deciding to adopt a 
panel report, intended that their de cision would constitute a definitive 
interpretation of the relevant provisions of GATT 1947.  Nor do we believe that 
this is contemplated under GATT 1994.  . . .  Article IX:2 of the WTO Agreement  
provides:  "The Ministerial Conference  and the General Council shall have the 
exclusive authority to adopt interpreta tions of this Agreement and of the 
Multilateral Trade Agreements".  Article  IX:2 provides further that such 
decisions "shall be taken by a three-fourth s majority of the Members".  The fact 
that such an "exclusive authority" in interpreting the treaty has been established 
so specifically in the WTO Agreement  is reason enough to conclude that such 
authority does not exist by implica tion or by inadvertence elsewhere.
3   
 10. This Panel likewise is charge d with undertaking an objective assessment of the matter before 
it, applying the proper customary rules of interpretation, and cannot make findings or 
recommendations that add to or diminish the right s and obligations in the covered agreements.   
 
Article XVI:4 of the WTO Agreement 
 
11. Turning to Article XVI:4 of the WTO Agreement,  the EC's interpretation of that provision, if 
adopted, would improperly add to or diminish the ri ghts and obligations of Members.  The EC argues 
that "the findings of the Appellate Body as adopted by the DSB in specific disputes create an 
independent international obligation for the losing party in that dispute to comply".
4  Because the 
                                                      
2 US – Zeroing (Mexico) , para. 7.106.   
3 Japan – Alcoholic Beverages (AB) , p. 13.   
4 EC First Written Submission, para. 128.   WT/DS350/R 
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  DSB has adopted Appellate Body reports holding zeroi ng inconsistent with prov isions of the covered 
agreements, the EC asserts that the United States is under a continuing obligation to comply, has not 
yet done so, and has therefore acted inconsistently with Article XVI:4.    12. The EC's expansive interpretation of Artic le XVI:4 should be rejected.  The idea of a 
continuing "independent internati onal obligation" arising from adopt ed reports cannot be reconciled 
with the text of the DSU, nor with the fact th at Appellate Body and pane l reports are not binding, 
except with respect to resolving the particular dispute between the parties to that dispute.  In short, no 
report can create any "obligation" independent of the covered agreements – Articles 3.2 and 19.2 of 
the DSU are explicit on this fact, and the EC approach is directly contrary to the very text to which 
the EC has agreed.  In light of Articles 3.2 and 19.2 of the DSU – which prohibit panels and the 
Appellate Body from adding to the obligations of Members – and the specific provisions of the DSU on compliance, including Article 21.5, the EC's proposed  interpretation of the text of Article XVI:4 is 
entirely inconsistent with the covered agreements a nd the rules of treaty interpretation as reflected in 
the Vienna Convention.    Scope of this Dispute  
(a) The EC Requested Establishment of the Pa nel on Measures not Included in its Request for 
Consultations 
13. The United States has asked the Panel to make  preliminary rulings as well on the EC's attempt 
to expand improperly the scope of this proceedi ng.  Today we will briefly discuss our three 
preliminary objections and respond to a few points that the EC raised in its submission of October 5.   
 14. The United States first requests a preliminary ruling that the measures appearing in the EC's 
panel request, but not in its request  for consultations, are outside of the Panel's terms of reference.  
More specifically, the EC's panel request added 10 s unset reviews and 4 administrative reviews to the 
38 specific measures originally listed in its request  for consultations.  The EC also added a new 
request concerning the "continued application of, or the application of, the specific antidumping 
duties" resulting from the antidumping orders in 18 cases, as calculated or maintained in place pursuant to the most recent administrative review, original proceeding, or changed circumstances or 
sunset review proceeding.   
 
15. Under DSU Article 7.1, a panel's terms of reference are determined by the complaining 
party's request for the establishment of a panel.  In  turn, DSU Article 6.2 provides that a panel request 
must "identify the specific measures at issue " in a dispute.  Under DSU Article 4.7, however, a 
Member may not request the establishment of a pane l with regard to any measure, but only with 
respect to a measure that was subject to consulta tions.  Finally, DSU Article 4.4 requires that the 
request for consultations state the reasons fo r the request, "including identification of the measures at 
issue  and an indication of the legal basis for the compla int".  As the United States explained in its first 
written submission, the Antidumping Agreement contains  parallel requirements in Articles 17.3-17.5.   
 16. The covered agreements thus establish a cl ear progression from the measures contained in the 
consultations request to the measures identified in  the panel request, upon which a panel's terms of 
reference are based.  As the Appellate Body explained in Brazil – Aircraft , "Articles 4 and 6 of the 
DSU . . . set forth a process by which the comp laining party must requ est consultations, and 
consultations must be held, before a matter may be  referred to the DSB for the establishment of a 
panel".
5  Under the relevant provisions in the DS U and Antidumping Agreement just discussed, a 
panel's terms of reference cannot include measures wh ich were outside the request for consultations.   
 
                                                      
5 Brazil – Aircraft (AB) , para. 131.    WT/DS350/R 
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  17. The EC's panel request contained measures that are not found in its request for consultations.  
None of the new measures can properly fall within this Panel's terms of reference.  Moreover, 
permitting the EC's panel request with respect to these measures would have a detrimental effect on 
the WTO dispute settlement system.  If a party co uld simply add new measures after consultations, 
the very purpose of consultations, and their prac tical utility, would be severely undermined.  The 
parties would never have had the opportunity thr ough consultations to reso lve their differences, 
contradicting the very notion of "prompt settlement" of disputes under Article 3.3 of the DSU.  Such 
an outcome would also detract from the goal in DSU Article 4.1 "to strengthen and improve the effectiveness of the consultation procedures employed by Members".    
18. Responding to the United States' preliminary objections, the EC has created various legal 
standards in an effort to convince the Panel to accep t the new measures contained in its panel request.  
However, it is irrelevant whether the new measures have a "direct relationship" with the measures in 
the consultations request.
6  Nor has the Appellate Body articulated a test that new measures involving 
"essentially the same matter" may be included in the panel's terms of reference when they were not 
included in the consultation request.7  Instead, this Panel should be guided by the DSU – a panel's 
terms of reference cannot include measures that were  not the subject of a request for consultations.  
And, in US – Certain EC Products , the Appellate Body agreed that the scope of measures subject to 
referral to the DSB is delineated by the consultations  request, and, absent a request for consultations, a 
new, legally distinct measure may not be placed before a panel in the request for establishment.8   
 
(b) The EC Failed to Meet the Specificity Requirement of DSU Article 6.2 
19. The United States also asks that the Panel find that the EC's reference in its panel request to 
the continued application, or application of an tidumping duties in 18 enumerated cases does not meet 
the specificity requirement of DSU Article 6.2.  The EC affirmed the open-ended, indeterminate 
nature of these alleged measures when it stated in  its October 5 response that the EC's panel request 
pertained to all "subsequent measures" adopted by  the United States with respect to the 18 measures 
included in its panel request.9  In effect, the EC  is asking this Panel to take jurisdiction over 
determinations that the United States has not yet made.    20. Under DSU Article 6.2, a panel request must "identify the specific measures at issue" in the 
dispute.  The specificity requireme nt is important for two reasons.
10  First, it ensures the clarity of the 
panel's terms of reference, which, pursuant to DSU Article 7, are typically determined by the panel 
request.  Second, it informs the responding part y and other Members of the nature of the 
complainant's case (i.e., the "measures" challenged and the WTO provisions invoked by the complaining party).  For other Members, this c ould often mean the difference between deciding to 
participate as a third party or not.   
 
21. The EC's imprecise reference to "most recen t" measures, and its admitted inclusion of 
"subsequent measures", related to 18 separate orders, is anything but  specific.  Each determination 
that sets the margin of dumping for a defined pe riod of time (for example, the period of an 
administrative review) is distinct and separate, and under DSU Article 6.2, the EC must identify 
specifically each measure in its panel request.  Instead, the EC is impermissibly attempting to include 
determinations beyond those explic itly listed in its panel request.  Because of the EC's lack of 
specificity, the United States is unable to determine when these determinations were or will be made, 
what calculations they did or will include, what dut y rates they have established or will establish, and 
what individual companies they did or will cover.   
                                                     
 
6 EC Response to Request for Preliminary Rulings, para. 25.   
7 EC Response to Request for Preliminary Ruling, para. 24.   
8 US – Certain EC Products (AB) , para. 82.   
9 EC Response to Request for Preliminary Rulings, para. 47.   
10 Japan – Film (Panel) , para. 10.9.   WT/DS350/R 
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  22. The EC cites various Appellate Body and panel re ports in an effort to convince the Panel that 
the "subsequent measures" are somehow identified "precisely" in its request for establishment.  
However, the reports cited by the EC are inapposite.  They involve disputes, such as EC – Bananas III  
and Japan – Film , where a law of general application was identified in a panel request, and 
subsequent implementing regulations were considered to fall within a panel's terms of reference.  
Here, the EC is not challenging a framework law and subsequent implementing regulations.  Each 
original investigation, administrative review, an d sunset review results in a distinct final 
determination which constitutes an action taken by  the United States.  In other words, a measure 
which must be identified precisely in the panel request.    
(c) The EC's Request Included Measures That were  not Final at the Time of its Panel Request 
23. Additionally, the United States asks that th e Panel exclude from its consideration four 
"measures" in the EC panel request because they are preliminary determinations.  Under Antidumping Agreement Article 17.4, a matter may only be referred to a panel if "f inal action has been taken by the 
administrating authority".  The EC, however, iden tifies three on-going sunset reviews, and one on-
going administrative review in its request for establishm ent of a panel.  In these four proceedings, the 
United States has not taken "final action", and therefore, under the Antidumping Agreement, these 
proceedings have not yet resulted in any measure that can  form part of this Panel's terms of reference.   
 24. The EC asserts that the on-going proceedings  are part of their catch-all reference to 
"subsequent measures" related to the 18 antidumping duty orders and that they therefore are properly 
included in the Panel's terms of reference.  Asid e from the flaws related to the EC's "subsequent 
measure" argument, the EC neglects altogether the pl ain language of Article 17.4 that governs here.  
The four on-going proceedings cannot properly be before this Panel , and terming them "subsequent 
measures" does not change this fact.   
 The Alleged Obligation to Provide Offsets 
 
25. We now turn to the EC's argument that the Antidumping Agreement contains an obligation to 
provide offsets for instances of non-dumping in the context of certain identified assessment 
proceedings.  The key here is that the text of the Antidumping Agreement does not impose on 
Members an obligation to provide an offset for non-dumped transactions in assessment proceedings.  
The starting point must be the text of the Agreement.  It is fundamental that in interpreting a treaty, a 
panel must not impute into that treaty words and obliga tions that are not contained in the text.  In this 
dispute, the EC asks this Panel to read an obligati on into the Antidumping Agreement.  In particular, 
the EC seeks to impose an obligation to reduce antidumping duties to account for instances of non-
dumping in assessment proceedings.  The EC does so despite the absence of a textual basis for such 
an obligation and despite the presence of a permis sible interpretation of the Antidumping Agreement 
that does not require such offsets.    26. In fact, 4 panels addressing this exact issue have consistently found th at there is no textual 
basis supporting an obligation to provide offsets outside the context of average-to-average comparisons in investigations.
11  There is a significant reason for this consistency.  The only textual 
basis that panels have identified for an obligati on to provide offsets has been the "all comparable 
export transactions" language in the text of Artic le 2.4.2 of the Antidumping Agreement, which 
relates specifically to average-to-average comparisons  in investigations, and is not applicable to any 
other kind of comparison in any other context.12   
 
                                                      
11 US – Zeroing (Japan) (Panel) , paras. 7.216, 7.219, 7.222, 7.259;  US – Softwood Lumber Dumping 
(Article 21.5) (Panel) , paras. 5.65, 5.66, 5.77;  US – Zeroing (EC) (Panel) , paras. 7.223, 7.284;  US – Zeroing 
(Mexico) , paras. 7.118, 7.119, 7.143.   
12 US – Softwood Lumber Dumping (AB) , paras. 86-90, 104-05.    WT/DS350/R 
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  27. In urging this Panel to find that the Anti dumping Agreement prohibits zeroing in the context 
of assessment proceedings, the EC cannot rely on text , because no such text exists.  Instead, the EC 
seems to rely most heavily on the Appellate Body's report in  US – Zeroing (Japan) .  We respectfully 
disagree with the reasoning used by the Appellate Body regarding the WTO-inconsistency of what it 
referred to as "simple zeroing" in periodic reviews.   Every panel that has examined the issue has 
concluded that zeroing is not prohibited by the An tidumping Agreement in such circumstances.   
 28. The EC argues that margins of dumping calcu lated in assessment proceedings must relate to 
the "product as a whole", and cannot be calculated fo r individual transactions.  The term "product as a 
whole" is not found anywhere in the Antidumping Agreement, nor does it have a defined meaning;  
moreover, "product as a whole" is not found anywhere in the Appellate Body report in US – Zeroing 
(Japan) .   
 29. In attempting to find a basis for its legal th eory, the EC refers to the definition of dumping 
contained in Article 2.1 of the Antidumping Agr eement and Article VI of the GATT 1994.  Nothing 
in either provision supports the argument that a margin of dumping must be calculated for the 
"product as a whole".  Instead, these provisions ta lk about dumping in terms of a product being 
introduced into the commerce of another country – an action that occurs through individual 
transaction s.  Nowhere does GATT Article VI or Article 2.1 of the Antidumping Agreement refer to 
the total of all transactions relating to that product over a period of time, let alone explain what would 
be the applicable period of time.   
 
30. The EC's argument is that injurious dumping that occurs with respect to one transaction is 
mitigated by another transaction made at a non-dum ped price.  However, nothing in the Agreement 
supports that view, nor does commercial reality.  To the extent that some transactions introduce 
merchandise into the market of an importing country at a price above normal value, this is to the 
benefit of the seller, and does not relieve the do mestic industry of the injury caused by other 
transactions made at less than normal value.    31. Our written submission more fully sets forth the textual and contextual bases, and other 
evidence that the concepts of dumping and margins of dumping, as defined in the Antidumping Agreement and the GATT 1994, are applicable to indivi dual transactions.  It explains that the terms 
"dumping" and "margins of dumping", as used in Article 2.1 of the Antidumping Agreement and 
Article VI of the GATT 1994, do not support the existence of an obligation to provide offsets for instances of non-dumping in assessment proceedings.    32. The EC's arguments concerning Article 9.3 fa il for much the same reason.  The EC contends 
that the term "margin of dumping" relates exclusiv ely to the "product as a whole", considered on an 
exporter-wide basis.  Article 9.3 requires that the amount of antidumping duty assessed shall not exceed the margin of dumping.  However, the obligati on in Article 9.3 may be applied at the level of 
individual transactions.  This understanding of th e term "margin of dumping" is particularly 
appropriate in the context of antidumping duty assessments, where duties are assessed on individual customs entries resulting from individual transacti ons for which importers are liable for payment.  
Panels in prior disputes have agreed that there is no reason why a product that is introduced into the 
commerce of another country cannot refer to a particular export sale.
13   
 33. Prior panels have also noted that an ob ligation to weigh one transaction against another 
cannot be reconciled with Article 9.4, which r ecognizes the existence of prospective normal value 
systems of assessment.  Under such systems, liab ility is determined on the basis of an individual 
transaction.  One import transaction has no effect on the amount of antidumping duty due as a result 
of other distinct transactions.  Reading Article 9.3 as requiring one transaction to offset another would 
                                                     
 
13 US – Zeroing (Japan) (Panel) , para.7.201;  US – Softwood Lumber Dumping (Article 21.5) (Panel) , 
paras. 5.53-5.57;  US – Zeroing (EC) (Panel) , para. 7.204.   WT/DS350/R 
Page D-8  
 
  require Members that use prospective normal valu e systems to conduct refund reviews even where 
every import was properly assessed duties based on a correct comparison of its export price to the appropriate normal value.  This would lead to an  absurd result:  prospective normal value systems 
would then be indistinguishable from retrospectiv e assessment systems.  The United States has been 
unable to identify a single prospective normal valu e system that provides for such reviews.   
 
34. It is also important to consider that, if th e EC's reading of "margin of dumping" is accepted as 
the sole permissible interpretation of Article 9.3, the remedy provided under the Antidumping 
Agreement and the GATT 1994 may be prevented fro m fully addressing injurious dumping.  If 
authorities have to take into account the export pri ces paid by all importers importing from the same 
exporter, the importers with the highest margins would pay less than the true margin of dumping 
because of the other importers importing at non-dump ed prices.  Such an approach would favor 
importers who participate in dumping over other importers (and domestic competitors) that compete 
fairly.    
35. The panel in US – Zeroing (Mexico)  recognized this dilemma, finding that this "kind of 
competitive disincentive to engage in fair trade c ould not have been intended by the drafters", and 
should not be accepted as consistent with Article 9.3.
14  The fact that some imports are made at non-
dumped prices does not change the fact that the domestic industry suffers from dumped imports, and 
the injury suffered is not mitigated by non-dumped prices.  Thus, requiring authorities to use non-dumped imports as an offset to dumped imports precludes the objective of antidumping duties – 
which is to redress the injurious effects of dumping.   
 36. Furthermore, adopting the EC's reasoning woul d cause implications for Article 2.4.2.  Any 
finding that Articles 2.1 and 2.4.2 of the Anti dumping Agreement and GATT Article VI contain a 
general prohibition of zeroing, would render the s econd sentence of Article 2.4.2, the targeted 
dumping provision, inutile .  This is because the targeted dumping methodology provided for in 
Article 2.4.2 mathematically must yield the same result as the average-to-average comparison if, in 
both cases, non-dumped comparisons are required to o ffset dumped comparisons.  In fact, the EC, a 
Member that uses the average-to-transaction co mparison, addressed this matter before its own 
tribunal.  There, the EC argued that a prohibition of zeroing cannot apply equally to both comparison 
methodologies because it would lead to the same ma thematical result, rendering the average-to-
transaction methodology redundant.
15  This fact cannot be ignored or diminished by assuming that the 
targeted dumping provision permits an authority to ignore any obligation in the Antidumping Agreement other than the obligation to use one of the two symmetrical comparison methods.  The 
panel in US – Zeroing (Mexico) agreed that this is a significant concern and one that the Appellate 
Body in US – Zeroing (Japan) had not properly addressed.   
 
37. The EC also contends that zeroing is inconsis tent with the "fair comparison" requirement of 
Article 2.4.  However, the EC does not argue that  any of the transaction-specific comparisons made 
by the United States failed to reflect a "fair comparis on".  Instead, the EC contends that the aggregate 
amount of antidumping duties assessed exceeded the ma rgin of dumping for the product as a whole.  
The relevant text of Article 2.4, however, provi des only that a "fair comparison shall be made 
between the export price and the normal value".  Th e text of Article 2.4 does not address whether any 
particular assessment of antidumping duties exceeds th e margin of dumping.  This is because the text 
of Article 2.4 does not address whether "dumping" a nd "margins of dumping" are concepts that apply 
to individual transactions.  Nor does the text address, for purposes of assessing antidumping duty 
liability, whether a margin of dumping may be specifi c to each importer that is liable for payment of 
                                                     
 
14 US – Zeroing (Mexico) , para. 7.146, quoting Oral Statement of the United States at the Second 
Meeting, para. 18.   
15 US First Written Submission, para. 117, citing Case T-274/02, Ritek Corp. v. Council of the 
European Union, 24 October 2006, para. 94 (Exhibit US-3).    WT/DS350/R 
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  the antidumping duties.  Indeed, the text of Artic le 2.4 does not resolve the question of whether 
zeroing is "fair" or "unfair".    38. Consequently, resolution of the EC's claim de pends not on the text of Article 2.4, but on 
whether it is permissible to interpret the term "mar gin of dumping" as used in Article 9.3 as applying 
to individual transactions.  Therefore, if the Pane l finds, as the prior panels have found, that it is 
permissible to understand the term  "margin of dumping" as used in Article 9.3 as applying to an 
individual transaction, the challenged assessments will not exceed the margin of dumping and there 
will be no basis for a finding of inconsistency with Article 2.4.    
39. The EC, in arguing for a blanket prohibition of zeroing, also relies on an erroneous 
interpretation of the term "investigation" in Artic le 2.4.2.  It seeks to deny meaning to the phrase 
"during the investigation phase" by recasting Article  9 assessment proceedings and Article 11 reviews 
as "investigations".  In the EC's view, any proceed ing which involves questionnaires, verification, and 
the possibility of a hearing constitutes an i nvestigation subject to Article 2.4.2.   
 
40. The Antidumping Agreement contains clear distinctions between investigations under 
Article 5 to determine the existence, degree and effect of dumping and other phases of an antidumping 
proceeding, such as assessment reviews and sunset  reviews.  The basic interpretive problem with 
the EC's analysis is that it reduces language in the Antidumping Agreement to redundancy.  
Article 2.4.2 provides for the application of certa in methodologies to determine the existence of 
margins of dumping "during the investigation phase".  The inclusion of the phrase "during the 
investigation phase" in Article 2.4.2 was intended to  have a limiting effect.  Indeed, labeling every 
dumping calculation exercise to be an investigati on would render the phrase "during the investigation 
phase" without meaning.    
41. In summary, the United States respectfully di sagrees with the Appellate Body's reasoning that 
the Antidumping Agreement includes a general prohi bition of zeroing, and rejects the EC's assertion 
that the United States has some type of genera l obligation under international law to eliminate 
"zeroing".  Instead, the United States agrees with the reasoning of antidumping experts on recent panels, finding that outside the context of averag e-to-average comparisons in investigations, the 
Antidumping Agreement does not impose an obligation to provide offsets for non-dumping.  At a 
minimum, we urge this Panel to find that a perm issible interpretation of the Antidumping Agreement 
contains no obligation to provide for an offset to dumping in assessment proceedings.   
 
42. Mr. Chairman, Members of the Panel, this c oncludes our opening statement.  We would be 
pleased to respond to any questions you may have.   
 WT/DS350/R 
Page D-10  
 
 ANNEX D-2 
 
OPENING STATEMENT OF THE EUROPEAN COMMUNITIES  
AT THE FIRST MEETING OF THE PANEL 
 
 
Mr. Chairman, distinguished Members of the Panel:    1. Thank you for agreeing to serve on this Panel.    
2. So here we all are again.  Another zer oing case – to be precise 18 further zeroing cases and 
some 52 further instances of the application of zeroing  by the US.  No doubt this is not the first time 
that you may have had occasion to consider the zeroing issue.  Certainly it is not the first time that the EC and the US have exchanged arguments on th is point – I may say exhaustive – sometimes even 
exhausting – arguments.  So much so that some pe ople have said that there is a certain amount of 
zeroing fatigue at the WTO – I certainly have the im pression that the third party statements are getting 
shorter – although the real world impact on EC exporters remains as severe as it ever was.    3. But there is one thing about this zeroing hearing that is new.  It is public  – something very 
much welcomed by the EC – and something that, in  a profound sense, goes to the very heart of this 
case.  One could put the question in these terms:  who owns the ADA?  Who is to tell us what it 
means?  Is its meaning a private  matter to be settled behind closed doors, according to the will of a 
few?  Or does its meaning rather result from a syst ematic and objective application – by judges – of 
the agreed rules of interpretation of public  international law – that is, the Vienna Convention?  To 
recall, the Vienna Convention refers to:  good faith , ordinary meaning, context, object and purpose 
and (as a supplementary means of interpretation) the preparatory work.   
 
4. Mr. Chairman, I am not sure I have ever seen a WTO Member in such an isolated and 
entrenched position as that of the US in this case.  Leaving aside for a moment the views of those who 
say this is just belligerent posturing by the US driv en by protectionist sentiment, let us ask ourselves 
the question:  what is it that really divides the tw o sides?  After-all, we cannot hope to resolve the 
dispute if we do not make a supreme effort, with an  open mind, to get to the root of this apparent 
mutual incomprehension.   
 5. In that spirit, after carefully re-reading many  times the US FWS I was finally struck by what 
is not in it:  namely any reference to the Vienna Co nvention.  I was further struck by the impression 
that the US position appears to reflect a strongl y held belief that a prohibition on zeroing in 
assessment proceedings was never "intended" by the US, because of the phrase "the existence of 
margins of dumping during the investigation phase" in  Article 2.4.2 of the ADA.  Consequently, in 
this opening statement, and in a genuine effort to re solve the matter, the EC would (again) like to try 
and bridge that gap, by bringing the agreed rules of  interpretation in the Vienna convention to bear on 
the phrase in question.   
 
6. Mr. Chairman, as an advocate, I am doomed to advocate.  But the story that I would now like to tell you has – I believe – the very great merit of being true – so much so that I think you would be 
hard pressed to find anyone on either side of the debate who – after cool-headed reflection – would 
seriously question it.    
7. We begin with the observation that the term  "zeroing" – which does not appear in the ADA, 
may be considered something of a misnomer, because  it describes only part of the problem:  that is, 
the downward adjustment of the relatively high export transactions;  or, in other words, the setting to zero of the negative amounts.  The heart  of the matter, however, is the selection
 of the relatively low  WT/DS350/R 
 Page D-11 
 
 
 priced export transactions per se , as a sub-category, as the only or preponderant basis for the dumping 
margin calculation.  This has nothing to do with "offsets" or "credits".    8. This is not a new problem.  It is di scussed at length in Jacob Viner's 1923 Memorandum,
1 and 
was specifically addressed in the Uruguay Round ne gotiations, during which the Members were fully 
informed of the issue and knew exactly what they were talking about.2  After more than 3 years of 
public negotiations, the problem was nicely summarised by the WTO secretariat:3  it was generally 
considered that the practice of comparing a wei ghted average normal value with individual export 
transactions was obviously unfair  to exporters – particularly from developing  countries – and required 
amendment of the Tokyo Round AD Code;  the US explained that such a method was necessary to 
reveal targeted dumping  – that is, successive attacks on differe nt parts of an importing market;  the 
consensus was that the Membership should try to find a solution to accommodate the legitimate 
concerns of both sides.  That compromise  was the text of Article 2.4.2 of the ADA, as it stands today.   
 9. Looking at the overall design and architecture of Article 2.4.2, and reading its provisions 
intelligently, in the light of the underlying economic  realities that the legal rules are intended to 
address and respond to – that is, the real world , it is clear that there are only three sub-categories of 
clustered low priced export transactions  that it is permissible to respond to :  those clustered by 
purchaser, region or time.
4  The Panel will note that these categories broadly correspond to typical 
market definition parameters:  they make economic  sense.   
 
10. Thus, it is not permissible , and it is not fair, to pick up low priced export transactions 
clustered by model.  The US has acknowledged as much .  This is clear from the term "all" in the first 
sentence of Article 2.4.2, and the definition of dumpi ng in Article 2.1 of the ADA and Article VI:1 of 
the GATT 1994 in terms of the product ;  read together with the absence in  the targeted dumping 
provisions of any reference to a sub-category by model .  Thus, the relevant provisions, and 
particularly the normal rule and the exception, are read harmoniously , so as to give meaning – both 
legal  and economic  – to all the treaty terms.   
 11. In exactly the same way, it is not possible to pick up low priced export transactions per se  as a 
sub-category.  There is no reference to any such sub-ca tegory in the provisions on targeted 
dumping .  To accept such a proposition would be to re nder the targeted dumping provisions useless;  
and to negate the compromise, negotiated and agre ed by all the WTO Members (in return for other 
concessions), to which I have just referred.  The pr oof of this is that for some 13 years the US has 
simply ignored the targeted dumpi ng requirements, content to continue doing exactly what it was 
doing before, based on its own unilatera l interpretation of Article 2.4.2.  The further proof of this is 
that, by its own assertion, the US sought the inser tion of the phrase "the existence of margins of 
dumping during the investigation phase" precisely with the intention of side-stepping  the compromise 
and the obligations that I have just outlined.  This is an important point – so  I hope you will permit me 
to repeat it.  The entire US position is premised on the implied admission that the overall design and architecture of Article 2.4.2 is to be interp reted in the manner advocated by the EC.   
 12. We turn, therefore, to the phrase "the existence of margins of dumping during the 
investigation phase", added – behind closed doors  – after some three and a half years of public 
                                                     
 
1 Jacob Viner, Memorandum on Dumping , written for the World Economic Conference of the League 
of Nations, 1926, Reprinted 1966, discussing dumping in terms of international price discrimination between 
different markets, and distinguishing between systematic or permanent dumping and sporadic, abnormal or temporary dumping (for example, at paragraphs 2, 5, 6, 9, 11, 12 and 13).   
2 The US agrees (US FWS, paragraph 89).  The US  is correct that Article VI of the GATT did not 
change, but ignores the fact that Article 2.4.2 of  the ADA was introduced in the Uruguay Round.   
3 MTN.GNG/NG8/15, page 13.   
4 ADA, Article 18.1:  "N o specific action against dumping … can be taken except in accordance with 
the provisions of GATT 1994, as interpreted by this Agreement".   WT/DS350/R 
Page D-12  
 
 negotiations.  According to the US, this means that the obligations in Article 2.4.2 do not apply to the 
re-calculation of dumping margins in assessment proceed ings.  Rather, the US is to be completely free 
to choose the methodology to be used for calcula ting a contemporaneous dum ping margin and finally 
collecting duties.  Since the results of the first retrospective assessment proceeding are applied with 
effect from the date on which duties we re first imposed, this would negate entirely  the compromise 
enshrined in Article 2.4.2.   
 13. In the EC's view, assuming Members negotiate  in full knowledge of th e Vienna Convention, 
it may reasonably be assumed that they negotiate in good faith, just as they agree that the terms of the 
ADA are to be interpreted in good faith.  In such negotiations, the EC would neither expect nor accept 
that what is clearly given, after lengthy deba te, with one hand (that is, agreement not to use 
asymmetry absent targeted dumping) would be surre ptitiously entirely taken away with the other 
hand.  The US position reflects what might be termed  the "last minute" "spanner in the works" theory 
of international negotiation – a tactic that, in the view of the EC, is hardly suited to a multilateral 
organisation with 151 Members, including many developing  countries.   
 
14. However, assuming for the sake of argument, that such negotiation tactics are permissible, 
the EC would like to draw the Panel's very close atte ntion to what a Member forfeits when it adopts 
such an approach .  First, most obviously, the Member c hooses to leave no trace of its intended 
unilateral interpretation in the preparatory work .  Second, and in similar vein, the Member chooses 
not to offer any explanation to its ne gotiating partners – many of whom are developing  countries – as 
to what the object and purpose  of such a provision might be.  This is particularly problematic when 
the subsequent unilateral interpretation flies in th e face of the overall design and architecture of the 
ADA.  Especially when there is no object and purpo se capable of explaining why, on the basis of 
identical data, the mere act of collection shoul d inflate the dumping margin many times over – a 
proposition that is "manifestly absurd or unreasonable" within the meaning of the Vienna 
Convention – both in legal terms and in economic  terms.  Third, and in similar vein, the Member 
chooses to forego any attemp t to reconcile conflicting context  with its intended unilateral 
interpretation.  The Panel will thus note that of th e various elements of the interpretive rule in the 
Vienna Convention, by the US' own choice , there is only one that stands  between the US and failure:  
the supposed ordinary meaning  of the phrase.   
 
15. We believe we have amply de monstrated that the ordinary m eaning of the phrase is not that 
advocated by the US.    16. We believe that, for the US, the term "inv estigation" was key in its intended unilateral 
interpretation.  In fact, we have an express admissi on of this in the US Statement of Administrative 
Action (SAA), which accompanied the adoption of  the US Uruguay Round Agreements Act, and 
which contains the words ("not reviews").
5  Obviously, the drafter of the SAA well appreciated that 
these words are not contained in Article 2.4.2 of the ADA, and do not result from a proper interpretation of that provision, which is precisely why they were inserted in the SAA in an attempt at 
ex post rationalisation  – an attempt doomed to fail, as subse quent WTO litigation has demonstrated.   
 
17. The ordinary meaning of the term "investiga tion" is simply a systematic examination or 
careful study of a particular subject.
6  When the US asserts that Article 2.4.2 refers to "an 
investigation to determine the existence, degree and effect of any alleged dumping", within the 
meaning of Article 5.1 of the ADA, it is the US – not  the EC – that is asking the panel to read words 
                                                      
5 United States Statement of Administrative Action accompanying the adoption of the Uruguay Round 
Agreements Act (URAA), and providing authoritative gui dance for its interpretation (Appellate Body Report, 
US - OCTG from Argentina , paragraph 207).  The SAA also confirms th at:  "the reluctance to use an average-to-
average methodology has been based on a concern that su ch methodology could conceal  "targeted dumping"".   
6 This view is supported by the dictionary meanings set out in The Shorter Oxford English Dictionary, 
fifth edition (2002) .    WT/DS350/R 
 Page D-13 
 
 
 into the text of Article 2.4.2 that are not there, and in a manner that is squarely disrespectful of the 
existing text.  Under the ADA there are five typ es of proceeding (original, newcomer, changed 
circumstances, sunset and assessment ), each of which involves an inves tigation into something.  This 
is exactly how the term is used in US municipal law.7  It is also exactly how it has generally been 
understood in the WTO.8   
 
18. Thus, in these proceedings, the US is arguing for the term "investigation" to have a limited9 or 
special meaning .  Under the terms of the Vienna Convention, that is only possible if the US 
establishes that all the Members  of the WTO so intended.10  And that is where the US stumbles, 
precisely because, in pursuing its "last minute" theory  of negotiation, the US itself chose to forego any 
attempt to get its intended special meaning agr eed by the other WTO Members – who have since 
confirmed that they intended no such thing.11   
 19. Although the cause is lost, the US struggles on.  It turns first to the term "existence" as somehow unique to original investigations – but this term simply relates to any dumping margin 
calculation.
12  Next, the US turns to the term "during … phase" – but this simply indicates "a distinct 
period" in the passage of time13 – as the EC submits, an investigation period – and the US is simply 
wrong to assert that there is only one type of "proceedi ng" with five phases, when there are in fact five 
types of proceeding, each of which may invol ve an investigation into something.   
 20. The discussion could stop here. But there are a multitude  of other interpretative points against 
the US.  First, the grammatical structure of th e phrase, in which the term "during … phase" is 
grammatically linked to a period of time in which margins exist (an investigation period) as opposed 
to one in which they are established (as the US would have it).  This both confirms the EC interpretation and precludes  the US interpretation.  Second, the defined term "margin of dumping" has 
the same meaning throughout the ADA, and must in form the meaning of the phrase – there being no 
support in the text for the view that the definition should change at the moment of final collection.  
Third, the overall design and architecture of Article  2.4.2, as outlined above.  It is particularly 
                                                     
 
7 The US Rules of Practice and Procedure of the International Trade Commission effective 6 July 1998 
(63 FR 30599) contain the following provision:   
Investigation to review  outstanding determination 
(a) Request for review.  Any person may file with the Commission a request for the institution of a review investigation
 under Section 751(b) of the Act.  The person making the request shall also 
promptly serve copies on the request on the parties to  the original proceeding u pon which the review is 
to be based.  All request shall set forth a description of changed circumstances sufficient to warrant the institution of a review investigation
 by the Commission.   
 A review under Section 751(b) of the Tariff Act is a changed circumstances review, as provided for in 
Article 11.2 of the ADA .   
 The US International Trade Commission systematically refers to "Changed Circumstances 
Investigations" and to "Five-Year  Review (Sunset) Investigations ".   
8 World Trade Organization, A Handbook on Anti-Dumping Investigations, Judith Czako, Johann 
Human and Jorge Miranda, Camb ridge University Press, 2003 , page 93, with respect to retrospective 
assessment proceedings:  "The margin w ould be recalculated by means of an investigation  much like the 
original investigation, addressing normal value, export price, and comparing the two, using the data for the POR.  This investigation
 could take up to 12 months". (emphasis added).   
9 US FWS, paragraphs 99 and 101.   
10 Vienna Convention, Article 31(4):  "A special meaning shall be given to a term if it is established 
that the parties so intended".   
11 A review of all notifications by WTO Members of their anti-dumping laws implementing the ADA 
reveals that none has adopted the US interpretation.  Furthermore, when questioned on this issue, other WTO 
Members have confirmed that they did not intend Article 2.4.2 to have the meaning advocated by the US 
(Appellate Body Report, US – Zeroing , paragraph 22).   
12 See particularly the title to Article 2 in the French language version of the ADA.   
13 This view is supported by the dictionary meanings set out in The Shorter Oxford English Dictionary, 
fifth edition (2002) .  It was advanced by the US itself in DS294.   WT/DS350/R 
Page D-14  
 
 significant in this respect that the EC pos ition reads the normal rule referring to the investigation 
period  in counterpoint to the exceptional rule permitting a response to time based targeted dumping.  
Thus, once again, the EC advances a harmonious  reading of all the treaty terms, that makes legal and 
economic  sense of all of them.  Fourth, the numerous refe rences in Article 2 to "investigations", which 
are considered, even in US municipal law, to refer to all types of investigations, including assessment 
proceedings.  Fifth, the rule in Article 9.3 that the amount assessed cannot exceed the dumping 
margin – with an express cross-reference to all of Article 2.  Sixth, the absence of any object and 
purpose argument capable of supportin g the US position.  Seventh, the preparatory work, as outlined 
above … And the list goes on.    
21. Finally, the US turns to some other general ar guments, equally without merit.  First, the so-
called "mathematical equivalence" argument,
14 which is obviously vitiated by a simple intellectual 
error:  something can perfectly well be fair as  a response to targeted dumping, but unfair absent 
targeted dumping.  Second, the argument derived fr om Article 9(4)(ii) and the so-called "variable 
duty" or prospective normal value.15  This provision concerns sampling, and insofar as it implies the 
possibility that one of the measures that could be  imposed pursuant to Article 9.2 ADA could be a 
variable duty, it equally implies that any such duty is ultimately subject to final assessment or refund 
under Article 9.3, with dumping margins re-calcula ted in accordance with all of the provisions of 
Article 2.  This is completely logical.  It plugs the gap that would otherwise arise in the refund  system 
under Article 9.3.2, in which final liability canno t, by definition, increase.  The only option for 
Members operating such systems who are fearful of targeted dumping is a variable duty, with refund 
in the event that the feared targeted dumping does not materialise.  The proposition that 
Article 9(4)(ii) in any way contradicts any of the in terpretative points that we have already outlined is 
thus without merit.  Third, the proposition that  because, in the US, assessment proceedings are 
importer driven, this should change the analysis.16  This practical assertion is without merit.  The 
ADA responds to international price discrimination by exporters ;  and it is a matter of elementary 
accounting  to calculate final liabilities for importers, wh ilst respecting the ceiling fixed by the amount 
of dumping practiced by an exporter.    22. Mr. Chairman, distinguished Members of the Panel, if all of the interpretative elements in the 
Vienna Convention support the position of the EC , and disprove the position of the US, the US 
interpretation cannot be said to be "permissible" within the meaning of Article 17.6 of the ADA.   
 
23. Some people say that zeroing poses a "constitutio nal" challenge for the WTO.  Certainly, 
these Panel proceedings place you at the centre of a livel y debate.  The EC is confident, however, that 
ultimately the still quiet voice of legal reason will prevail.  What determines the matter is the systematic application of the agreed rules of inte rpretation of public international law in the Vienna 
Convention.  Not ex post  expressions of personal will.  Human natu re being what it is, it is not always 
easy for people to acknowledge their own error.  Your task under Article 11 DSU to reach an 
objective and independent assessment is, however, cl ear – and however difficult it may prove to be – 
the EC is confident you will rise to the challenge.    
Thank you for your attention.   
 
                                                     
 
14 US FWS, paragraphs 112 to 118 and 145.   
15 US FWS, paragraph 93, 111 and 125.   
16 US FWS, paragraphs 129 and following.    WT/DS350/R 
 Page D-15 
 
 
 ANNEX D-3 
 
 
CLOSING STATEMENT OF THE UNITED STATES  
AT THE FIRST MEETI NG OF THE PANEL 
 
 
Mr. Chairman, Members of the Panel:   
 1. On behalf of the United States' delegation, I would once again like to thank you and the members of the Secretariat for your work on this dispute.  We appreciated the opportunity to provide you with preliminary thoughts on your questions and look forward to provid ing you with additional 
comments in our written responses and our second submission.   
 
2. The United States would like to thank the Pane l again for opening this hearing to the public.  
We note that three third parties took the opportunity to make public statements.  WTO Members and the public have had an opportunity to see the Pa nel's professionalism and impartiality, which can only 
strengthen the credibility of the WTO dispute settlement system.   
 
3. The issue of the role of Appellate Body re ports in WTO dispute settlement has been raised 
several times over the last two days.  To be clear, the United States is not asking the Panel blindly to 
follow the four panel reports that have not found a general prohibition on zeroing in the Antidumping Agreement, nor have we asked you to ignore  Appellate Body reports finding zeroing to be 
WTO-inconsistent in certain circumstances.  What we have asked you to do, and are confident you 
will do, is to fulfil your function to make an objec tive assessment of the matter before you and not to 
add to or diminish the rights and obligations of Me mbers.  As part of that, we have asked you to 
consider whether previous panel reports on this issue are persuasive;  we believe they are.  We have 
also asked you to consider whether previous Appella te Body reports on this issue are persuasive;  we 
have explained they are not.  The Panel will have to make its own consideration and decision on the 
relevance of these reports as previous panels confro nted with claims against so-called zeroing have 
done.    4. The United States would like to address one set of the alleged measures that the EC has asked 
the Panel to consider, and that was the basis for c onsiderable discussion at yesterday's panel meeting – 
the so-called "application or continued applicatio n" of specific antidumping duties in 18 cases as 
identified in the EC's panel request.  The EC's atte mpt to clarify that set of supposed "measures" has 
caused even further confusion;  the United States would like to shed light on how it believes the Panel 
should approach the question of whether such "measures" exist and, to the extent they do, whether they fall within the Panel's terms of reference.    
5. As we discussed yesterday, the EC's panel request dropped the reference to the so-called 
"zeroing" methodology that was contained in its c onsultation request, but ad ded the alleged "measure" 
of "the continued application of, or the appli cation of the specific anti-dumping duties resulting from 
the anti-dumping orders" in 18 cases listed in its Anne x.  Moreover, the EC listed the 38 investigation 
and administrative review final determinations fro m its consultations request plus an additional 
14 administrative reviews and sunset reviews.   
 6. By virtue of DSU Articles 4 and 6, the a dditional "measures" contained in the EC's panel 
request are not properly before the Panel.  Unde r those provisions, a Member must first request 
consultations on a measure before re questing a panel.  It cannot identify the measure for the first time 
in its panel request.  Significantly, in this disput e, the EC's panel request did not "narrow" its 
consultations request as the EC suggested to us ye sterday.  Instead, it broadened its panel request 
inconsistent with the DSU.   WT/DS350/R 
Page D-16  
 
 7. The "application or continued application" of antidumping duties has been the subject of 
considerable confusion for the United States.  Under Article 6.2 of the DSU, the EC was obligated to 
identify the specific measures at issu e, and the Panel's terms of refe rence under Article 7.1 of the DSU 
are limited to those specific measures.  Therefore,  the only specific measures identified by the EC's 
panel request must be those applications of duties actually contained in the EC's consultation request.  
As an initial matter, the EC's request appears to ask  the Panel to decide whether it is the "continued 
application" or
 the "application" that is at issue.  The EC as the complaining party is the one that must 
decide this in identifying the "mea sures" that it is challenging.   
 8. Furthermore, the application or continued application of duties resulting from 18 separate 
orders maintained in place or calculated pursuant to the "most recent" measure refers to the "most 
recent" determination identified in the Annex to the panel request for each of the 18 orders and 
otherwise properly before the Panel.  In other words, the "application" of the duties under the 18 orders would be at least 18 different measures, although in referring to the various administrative 
and sunset reviews and original investigations the EC  appears to refer to a large multiple of 18.  The 
"continuing application" is unclear – to the extent  that the EC intends to refer to unspecified 
determinations or the application of duties under an  order after the date of the panel request, then 
the EC panel request fails to conform to Article 6.2 of the DSU.  The panel request cannot identify 
"specific" measures if they are not specified or if they do not exist at the time of identification.   
 9. Perhaps in recognition of the failings of its panel request, the EC has again tried to rewrite 
these measures.  In its Response to  the US Request for Preliminary Rulings, the EC noted that the 
"most recent" determination also included "any subsequent measure".
1  Under the DSU, "any 
subsequent measure" could not be a measure subject to dispute settlement if it did not exist as of the 
time of the Panel's establishment.   
 
10. The reference in the EC's request to unspecifi ed "most recent" proceedings would also appear 
to reach unspecified past antidumping determin ations.  To illustrate, with respect to Ball Bearings 
from Germany , which is case III in the EC's Annex to its pa nel request, the EC identified a number of 
administrative reviews and a number of particular co mpanies.  However, there is also at least one 
other rate currently in effect – known as the all others  rate.  It is unclear whether the EC's reference to 
the "application or continued application" of antid umping duties would include that rate.  This is 
relevant for the US defence and for the Panel's an alysis because it would raise distinct legal and 
factual issues related to this rate that have not  otherwise been discussed.  At a minimum, the Panel 
should be aware that the all others rate currently in  effect in this case, among others, is the result of 
the original investigation determina tion.  In this specific case, that determination was made in 1989.  
There are clearly certain additional legal issues that mu st be considered if the EC is asserting that the 
obligations in the Antidumping Agr eement apply to dumping margins calculated more than five years 
before the Agreement's conclusion.  Similar or add itional issues might arise with respect to the other 
cases identified by the EC depending on the full breadth of what the EC means by the phrase 
"application or continued application".    11. Unfortunately, the problems with the EC's approach do not end here.  Yesterday, the EC 
seemed to be saying that the "application and cont inued application" of antidumping duties resulting 
from 18 orders was intended to encompass the app lication of zeroing in the 18 cases listed in the 
Annex.  The EC also claimed that the "applicati on and continued application" was possibly part of 
some sort of combined "as applied/as such" measure  – what Japan recognized this morning to be "a 
new kind of measure".
2   
 
                                                      
1 EC Response to Request for Preliminary Rulings, para. 47.   
2 Japan Oral Statement, para. 3.    WT/DS350/R 
 Page D-17 
 
 
 12. The EC's attempted redefinition of this alle ged measure cannot be r econciled with its panel 
request.  That document refers to "the continued ap plication of, or the application of the specific anti-
dumping duties" in 18 cases.  The United States fail s to see how that phrase could be interpreted to 
refer to the application or continued application of "zeroing".  This description also lacks specificity.  
The EC would like to assert now that it included a generalized reference to the application of 
"zeroing" in 18 broadly-defined cases without id entifying the exact determination where it was 
actually applied, indeed explicitly trying to sweep in determinations that the United States has not 
even made.    13. The United States asks the Panel to ponder how such a purported measure could in any way 
be part of an "as such" claim, when it refers to the "application" of something.  The EC has stated 
explicitly that it "has decided not to ask this Pa nel to rule again on the inconsistency of the 
United States' zeroing methodology in original investig ations and in review investigations 'as such.'"
3  
It is unclear whether the EC has again changed its mind.    
14. It would appear that what the EC really woul d like is to have this Panel impose some sort of 
continuing obligation on the United States to el iminate "zeroing" based on non-binding Appellate 
Body reports in disputes other than the current disput e.  As the United States explained, an obligation 
to provide offsets in administrative reviews is f ound nowhere in the covered agreements, and the EC 
cannot play games with the identification of measures in an effort to accomplish what the WTO agreements have not established.   
 
15. This Panel should reject the "application or c ontinued application" set of measures as outside 
its terms of reference.  The supposed measures were not identified in the consultations request and the 
EC's request also fails for lack of specificity.    
16. Mr. Chairman, members of the Panel, we a ppreciate this opportunity to present these closing 
comments and look forward to continuing to work with you on these issues.   
  
                                                     
 
3 EC First Written Submission, para. 2.   WT/DS350/R 
Page D-18  
 
 ANNEX D-4 
 
 
CLOSING STATEMENT OF TH E EUROPEAN COMMUNITIES 
AT THE FIRST MEETI NG OF THE PANEL 
 
 
1. Mr. Chairman, distinguished Members of the Panel:   
 2. In this closing statement the EC would briefly like to recall some of the things that have been 
discussed at this hearing – some of them quite remarkable.    3. In general terms, we have heard the US ass ert that you do not need to consider the economic 
aspects of the real world that the legal rules in the ADA were designed to regulate.  Nor do you need 
to consider the overall internal economic logic a nd consistency of the ADA, and particularly the 
overall design and architecture of Article 2.4.2.  In  the words of the US, the ADA is a "flying pig".  
We disagree.  We offer the Panel an interpretation that not only fully respects – indeed we believe is 
dictated by – the legal rules of interpretation (good faith, ordinary meaning, context, object and 
purpose and the preparatory work), but which also makes economic sense of all the relevant treaty 
terms, and respects the overall design and architect ure of the provisions in question and the ADA as a 
whole.    4. We have also heard the US assert that th e essential disciplines of the ADA are voluntary 
when it comes to investigating and re-calculati ng dumping margins in assessment proceedings – both 
the substantive disciplines of Article 2 and the proce dural disciplines of Article 6.  We have further 
heard the US assert that it is not bound by any methodology at all – but free to do as it wishes when comparing normal value and export price in assessment proceedings – as well as newcomer 
proceedings.  Again, we disagree.  The ADA impos es mandatory obligations.  The WTO is a single 
undertaking, and Members are not permitted to enter reservations to any of the obligations established 
in the covered agreements.   
 5. We have further heard the US confirm that the only real defence it offers to the EC claims is 
the meaning of the phrase "the existence of marg ins of dumping during the investigation phase" – 
the US does not otherwise seriously question the meaning of the overall design and architecture of 
Article 2.4.2.  And yet, in the same breath, and in an extraordinary U turn , we have heard the US 
admit that the ordinary meaning of the term "inv estigation" is not synonymous with the term "an 
investigation to determine the existence, degree a nd effect of any alleged dumping".  We have also 
explained why the term "during … phase" does not assist  the US.  The US has agreed that this term 
has a temporal connotation, and therefore refers to  a "distinct period" – in other words the US has 
agreed that the terms "during … phase" and "during … period" are, in this context, synonymous.  The 
observation that the term "during … phase" refers to a distinct period of time does not advance in any 
way the US claim that the term refers to the 18 m onth period in Article 5.10.  On the contrary, the 
ordinary meaning of the grammatical structure of the phrase compels the conclusion that it refers to a period of time in which margins exist, that is, a da ta period – an original investigation or review 
investigation period;  and precludes the proposition that  it refers to a period of time in which margins 
are "established" as the US would have it.  There is  no rule of interpretation of public international 
law that supports the view that a term should be given a special meaning just because it is "unique" – there are many unique terms in the ADA and their meaning is to be determined by applying the 
agreed rules of interpretation in the Vienna Conventi on.  Nor is there any rule of interpretation that 
precludes synonyms – the AB has said this many ti mes, and there are many such synonyms in the 
ADA.  In the EC reading, the normal rule (inv estigation period) complements the exception (time 
based targeted dumping), and thus fits with the ove rall design and architecture of Article 2.4.2 and the 
ADA as a whole.    WT/DS350/R 
 Page D-19 
 
 
 6. Mr. Chairman, whatever the intent of the US might or might not have been, is irrelevant.  
Under the terms of the Vienna Convention, for the US to establish the special meaning it argues for, 
the US would have to demonstrate that all the Me mbers intended such special meaning – which is 
manifestly not the case.  The US made a mistake.  We are sorry about that.  But the consequences are 
for the US to bear, not the rest of the WTO Membership.  If the US had taken the trouble to discuss its 
intentions with the other WTO Members, many things  might have been different.  The US cannot rely 
on its own failings in order to unilaterally acquire additional rights under the WTO.   
 7. Some might say that the US has already ach ieved everything it desired – on the basis of its 
unilateral interpretation the US has for some 13 y ears collected hundreds of millions of dollars in 
excess anti-dumping duties – not to mention the far greater economic harm that such measures will 
have caused in terms of lost trade and development,  particularly for developing countries.  13 years is 
a long time – long enough even for a new round of WTO negotiations.  Not one cent of this money 
has ever been repaid and there is no prospect that the US will ever agree to repayment, or remedy the 
other harm it has inflicted on its fellow Members.   All the WTO Members now agree:  enough is 
enough.  It is time for the US to stop.   
 WT/DS350/R 
Page D-20  
 
 ANNEX D-5 
 
 
THIRD PARTY ORAL STATEM ENT OF BRAZIL AT THE 
FIRST MEETING OF THE PANEL 
 
 
Mr. Chairman, Distinguished Members of the Panel:   
 1. Brazil welcomes this opportunity to present its vi ews on some of the issues in this dispute.  
Brazil is part of the overwhelming majority of the Membership that has been year after year standing for the condemnation of the so-called "zeroing" methodology.    The reiterated condemnation of "zeroing"
 
 
2. Almost a decade has passed sin ce "zeroing" was first condemned in EC – Bed Linen .  
From 2000, the year of the first condemnation, to now, 2008, such a methodology was challenged at least seven other times, and "zeroing" as applied  and as such  was found to be inconsistent with the 
Antidumping Agreement.  The list of cases is long: US – Hot Rolled Steel ;  US – Corrosion-Resistant 
Steel Sunset Review ;  US – Softwood Lumber V;  US – OCTG Sunset Review ;  US – Zeroing (EC) ;  
US – Antidumping Measure on Shrimp from Ecuador , and most recently, US – Zeroing (Japan) .   
 3. You may have noticed that in those seven disputes – not to mention the on-going cases – the complained party has been always the same.  Th e number of cases brought against the United States 
on this issue tells us that, unfortunately and despite the successive rulings agains t it, the United States 
continues to resort to the "zeroing" methodology.    4. The language of those rulings is crystal clear , reaffirming the illegality of "zeroing" in all 
types of investigation.  Considering the US reite rated use of "zeroing", one can only conclude that 
what the United States intends to do is to prolon g the life of "zeroing", keeping it in place, until the 
Membership challenges all the possible forms, u se and application of zeroing in all kinds of 
comparison (W-W, T-T, W-T), in all types of investig ation (original, periodic and sunset reviews).   
 5. The consequences of such a tactic have been  disastrous.  Deliberately misrepresenting the 
Agreement on Antidumping, as well as ignoring the fi ndings and conclusions of  panels' and Appellate 
Body's reports, the United States has in practice refu sed to eliminate the "zeroing" methodology in its 
investigations, in breach of its WTO obligations.    6. In every new dispute on the issue – and they have been numerous – as listed before, the United States tries to reargue its previous cases, attempting to defend what is undefendable and what 
has been condemned many times.  This dispute is no different.   
 7. Most of the arguments the United States put fo rward in the present case were tested before 
and rejected by panels and the Appellate Body.  The United States seems to refuse to recognize this 
fact.   
 
8. In the following sections I will explain why Brazil considers this panel should not concede 
the US arguments and why it should reiterate the illegality of the zeroing methodology.    WT/DS350/R 
 Page D-21 
 
 
 The United States continued refusal to abide by the Agreement on Antidumping and the DSB 
determinations  
 
9. In a vain attempt to support its particular view of the AD Agreement, the United States 
rehashes in the present dispute a "pot-pourri" of its best arguments in almost ten years of WTO 
litigation on "zeroing".  It resorts to objections of di fferent nature, from burden of proof to procedural 
and substantive issues.  While Brazil will focus it s statement on some of the substantive objections 
raised by the United States, this approach should not be seen as endorsing the remainder of the US 
claims.    
10. It is undisputed between the parties that zer oing is not permitted under certain circumstances.  
Even the United States recognizes it.
1  Nonetheless, the central argument of the US defence is that the 
obligations of Articles 2.1 and 2.4 of the Agre ement on Antidumping refer solely to original 
investigations.  According to the United States,  for having purposes different from the ones of the 
original investigation, the periodic and sunset re views would not be subject to those obligations.2   
 
11. For this reason, it seems to be the US argumen t that the definitions of "product", "margins of 
dumping" and the obligation of "fair comparison", as provided for in Article 2, would not apply to 
periodic and sunset reviews.    12. Then, it would follow;  the Department of  Commerce would be entitled to resort to the 
"zeroing" methodology in all circumstances other than the original investigation.  Brazil strongly 
disagrees with the United States.  This line of ar gumentation is flawed and should not be accepted by 
the Panel in the present dispute.  In Brazil's opini on, the standards set forth by Article 2, namely, 
"product", "margins of dumping" and "fair comparis on", are at the core of any investigation, be it 
original, periodic or sunset reviews.  This is th e very spirit of the Antidumping Agreement, expressly 
reflected under Article 18.3:  "the provisions of this agreement shall apply to investigations and 
reviews".    13. Let me comment on each of them, beginning w ith "product".  When it comes to the existence 
of dumping, the Agreement establishes a direct re lationship between "dumpi ng and product", rather 
than "dumping and transaction", as alleged by the United States.
3  Article 2.1 of the AD Agreement 
and Article VI:1 of the GATT 1994 clearly set out that "for the purpose of this Agreement, a product  
is considered as being dumped […] if the export price of the product  […] is less than the comparable 
price for the like product  when destined for consumption in the exporting country".   
 14. One would note first that there is no single reference to  transaction.  Additionally, dumping is 
characterized in relation to the product as a whole .  Second, a such definition is applicable to the 
entire Agreement.  This interpretation was confirmed by the Appellate Body in EC – Bed Linen , US – 
Corrosion-Resistant Steel Sunset Review ;  US – Softwood Lumber V , US – Zeroing (EC) , and, most 
recently, in US – Zeroing (Japan) .   
 15. Let us take now the second standard, "margi n of dumping".  Similarly to the concept of 
dumping, margins of dumping are also defined in re lation to the product, rather than transaction.  
Article VI:2 of the GATT 1994 leaves no doubt about this.  The Appellate Body itself failed to see 
"how an investigating authority could properly establish margins of dumping for the product under 
investigation as a whole without aggregating all of the results of the multiple comparisons for all 
                                                     
 
1 See United States First Written Submission, paras. 77 and 155.   
2 See United States First Written Submission, para. 108.   
3 See United States First Written Submission, para. 85.   WT/DS350/R 
Page D-22  
 
 product types".
4  It also affirmed that "the amount of the assessed antidumping duties shall not exceed 
the margin of dumping as established for the product as a whole ".5   
 16. As we can see by these decisions and statem ents, the concept of "margin of dumping" not 
only encompasses the notion of product as whole , but also operates as a ceiling  to the duties to be 
imposed.   
 17. It should be clear for the United States, by now, that the concepts of dumping, margins of dumping and product (considered as a whole) are inte rtwined.  If not, let me recall the Appellate 
Body's view on this:  "it is evident from the d esign and architecture of the Antidumping Agreement 
that:  (a) the concepts of 'dumping' and 'margins  of dumping' pertain to a 'product' […] and (b) 
'dumping' and 'dumping margins' must be determin ed in respect of each known exporter or foreign 
producer examined.  These concepts are interlinke d.  They do not vary with the methodologies 
followed for a determination made under the vari ous provisions of the Antidumping Agreement".
6   
 
18. Now I turn to the third standard, the obligation of "fair comparison" also provided for in 
Article 2.  This is an overarching principle that  applies throughout the Agreement, as established by 
Articles 2.4, 9.3, 18.3 and interpreted by the Appellate Body in EC – Bed Linen  and subsequently 
reiterated in US – Zeroing (EC) .  The Appellate Body explained that 'fair comparison' "is a general 
obligation that [...] informs all of Article 2, but applies, in particular, to Article 2.4.2 which is 
specifically made 'subject to the provisions governing fair comparison in [Article 2.4]'".7  It also 
affirmed that "the 'fair comparison' language in the first sentence of Article 2.4 creates an independent 
obligation, and, secondly, that the scope of this obligation is not exhauste d by the general subject 
matter expressly addressed by paragraph 4 (that is to say, the price comparability)".8   
 19. In zeroing some transactions, the US Depart ment of Commerce is not taking account of the 
product as a whole;  neither is it respecting the ce iling established by the margins of dumping because 
zeroing results in artificial, higher margins of  dumping and makes a pos itive determination of 
dumping more likely.
9  It is clear, then, that – by resorting to the zeroing methodology – an 
investigating authority cannot con duct an unbiased and fair determin ation of dumping, as required by 
Article 17.6 (i).    The US arguments
 
 
20. Let us address first the argument concerning the alleged authorization to apply zeroing in 
investigations related to targeted dumping.  The Un ited States tries to convince this panel that the 
second sentence in Article 2.4.2 would allow for the application of "zeroing" methodology.  It resorts 
to that second sentence in order to legitimate its zeroing practice in the "average-to-transaction" 
method in periodic reviews.  This cannot be accepted.    21. Neither the second sentence of Article 2. 4.2 nor the AD Agreement as a whole endorses 
"zeroing".  We all know that (i) "zeroing" conflicts with the architecture and design of the AD Agreement;  (ii) the second sentence of Article 2.4.2 foresees an exceptional  circumstance .  It 
does not constitute an exception to the principles  governing the AD Agreement and (iii) a corollary of 
the precedent, since it is not an exception to th e fundamental principles of the Agreement, the 
                                                     
 
4 See Appellate Body Report in US – Softwood Lumber V , para. 98.   
5 See Appellate Body Report in US – Zeroing (EC) , para. 127.   
6 See Appellate Body Report in US – Zeroing (Japan) , para. 114.   
7 See Appellate Body Report in EC – Bed Linen, para.59.   
8 See Appellate Body Report in US – Zeroing (EC) , para.146.   
9 See Appellate Body Report in US – Softwood Lumber V (Art.21.5 – Canada) , para.142.    WT/DS350/R 
 Page D-23 
 
 
 situation described in the second sentence of Article 2.4.2 is still subject to the tenets set out by the 
AD Agreement.10   
 22. Second , the United States also claims that dumping may occur in a single transaction.
11  This 
does not hold true.  While conceding that the inv estigating authority has discretion to define the 
product under investigation, the Appellate Body la id down that "dumping" and "margins of dumping" 
can be found to exist only in relation to a product.  Th ey cannot be found to exist at the level of a type, 
model, or category of a product under consideration;  nor can they be found to exist at the level of an 
individual transaction.12   
 
23. Third , the United States argues that – because they  have different purposes – the three types 
of investigation (original, assessment and sunset) are not subject to the same obligations under the 
AD Agreement.  In Brazil's opinion, such an argum ent is misleading because it changes the focus of 
the analysis from the existence and amount of dumping to purposes .   
 
24. Let us assume that those three investigations have indeed different objectives;  namely, i) to 
establish whether a remedy against dumping should be provided;  ii) to precise the amount of that 
remedy13 and, finally, iii) to determine the lik ely continuation or recurrence of dumping.14   
 25. All of us know that, in order to meet any of  those three objectives, th e investigating authority 
has necessarily to assess the existen ce and/or the margins of dumping.  This assessment cannot be 
made without applying the concepts of "product",  "margins of dumping" and "fair comparison", as 
defined by the Agreement and the Appellate Body.  In applying those standards, one can reasonably 
conclude that what really matters in those investig ations – whether original, periodic or sunset – is 
how the margin of dumping is calculated, irrespective of  the objective of the investigation.  Therefore, 
no matter the purpose, the three types of investigat ion are all about "product", "margin of dumping" 
and "fair comparison".   
 26. Four , turning now to the United States suggesti on that original investigation and assessment 
reviews would also be independent  proceedings.
15  Brazil strongly disagrees with this creative, but 
totally illogical suggestion. Independe nce of proceedings is not at stake.  This is about the use of 
zeroing as a methodology for dumping calculation.  Even if we concede that t hose investigations may 
be independent, one cannot allege independence of proceedings to refuse to apply the principles and 
guidelines set out in Articles 2.1 and 2.4, namely, again, the concepts of "product", "margins of 
dumping" and "fair comparison".  Zeroing itself is inconsistent with the Antidumping Agreement, no 
matter the proceeding it is applied to16.   
 
27. Moreover, investigations may be independent, but they are not dissociated from each other.  
This is so because the flawed ma rgins or the mere existence of dumping found in any phase – by 
means of applying zeroing – will irreparably taint the subsequent investigation, to the extent that the 
subsequent investigation relies on a legally fl awed existence or margin of dumping.   
                                                      
10 See Appellate Body Report in US – Softwood Lumber V  (Art. 21.5 – Canada), para.97.  See also 
notes 7 and 8.   
11 See United States First Written Submission, para. 85.   
12 See Appellate Body Report in US – Zeroing (Japan) , paras.115 and 151.   
13 See United States First Written Submission, para. 108.   
14 See United States First Written Submission, para. 153.   
15 See United States First Written Submission, para. 71.   
16 See Appellate Body Reports in US – Corrosion- Resistant Steel Sunset Review , para.127;  and US – 
Zeroing (Japan) , paras.183-185.   WT/DS350/R 
Page D-24  
 
 Mr. Chair,  
 28. All those arguments put forward by the Unite d States in this case were already tested in 
previous opportunities.  The numerous quotations made  by the EC and third parties to the Appellate 
Body and panels' reports s how us a consistent pattern:  the failu re of the United States to convince the 
dispute settlement mechanism that zeroing can meet th e standards of Article 2:  "product", "margin of 
dumping" and "fair comparison", and of the Antidumping Agreement as a whole.    29. The US tries to dismiss the EC's arguments re garding the Appellate Body 's conclusions on the 
grounds that they are not "persuasive".
17  Given the United States record on non-compliance with 
multilateral rulings, especially when it comes to "zer oing", one can only conclude that arguments may 
never  be persuasive enough for the United States, notw ithstanding the consistent condemnations of 
the practice by the WTO dispute settlement mechanism.   The continued existence and application of 
zeroing by the United States, regardless of what the Antidumping Agreement, the panels' and the 
Appellate Body reports had to say about it during the course of almost ten years of litigation, seems to 
suggest that the United States will continue to di sregard DSB rulings.  It also indicates that the 
United States will persist on implementing them in a very specific and limited way, as it did in the 
"Hot Rolled Steel" and "Shrimp" cases brought by Japan and Ecuador, respectively.    30. Persuasiveness, however, is not the issue.  Th is is about abiding by the successive rulings of 
the DSB on the illegality of zeroing and eliminating once and for all this biased and non-compliant 
practice.   
 31. In its crusade to safeguard the use of th e US DoC antidumping practices, the United States 
resorts to negotiating history, to the Tokyo Round Antidumping Code and to the work of the experts 
in the GATT 1947.  After repeated rulings on the illegality of zeroing, unearthing the past seems at 
this point an argument of last resort, completely unpersuasive, where all others have failed.  The 
Appellate Body confirmed that they are of limited  relevance and provide no  additional guidance on 
the issue.
18  Nonetheless, while the United States may interpret that zeroing was permitted at that 
time, the reality today under the Antidumping Agreem ent and the Appellate Body's decisions leaves 
no margin for accepting zeroing.  The zeroing methodology is the embodiment of one of the capital sins in the multilateral trading system:  protectionism.   
 
Mr. Chair, Distinguished Members of the panel,   32. Brazil is confident that your conclusions w ill add to the list of successive condemnations of 
zeroing in all types of investigation, regardless of the methodology employed, be it prospective or 
retrospective.  For the sake of multilateralism and co mpliance, we genuinely hope that, in the light of 
another condemnation, the United States this time w ill abide by your decisions, whether or not it is 
persuaded by your arguments.    
Thank you very much.   
 
                                                     
 
17 See United States First Written Submission, paras. 98 and 115.   
18 See Appellate Body Report in US – Softwood Lumber V (Article 21.5 – Canada) , para. 121.    WT/DS350/R 
 Page D-25 
 
 
 ANNEX D-6 
 
 
THIRD PARTY ORAL STATEM ENT OF INDIA AT THE 
FIRST MEETING OF THE PANEL 
 
 
Mr. Chairman and Distinguished Members of the Panel:   
 1. India thanks you for having provided us an o pportunity to present our views as a third party in 
this dispute.    2. The issue of zeroing is of extreme systemic importance to the multilateral trading system.  It 
is regrettable that the United States continues to apply the "zeroing" methodology for determining 
anti-dumping margins despite the clear conclusion re ached in several reports of Panels and the 
Appellate Body that use of this zeroing methodology  is inconsistent with Articles 2.4.2, 9.3, 11.2 
and 11.3 of the Anti-Dumping Agreement.    
3. Mr. Chairman, India notes that, on 26 December 2006, the United States announced that it 
had partly implemented the DSB ru lings and recommendations in DS294 United States – Laws, 
Regulations and Methodology for calcula ting dumping Margins (US – zeroing (EC))  by changing its 
methodology of model zeroing, so as to abandon the use of zeroing.  However, several measures imposed by US have not been corrected, and remain ta inted by the use of zeroing.  In this respect, we 
would specifically draw attention to the Appellate Body report in United States – Measures related to 
zeroing and Sunset reviews – Japan (DS322).  At the DSB meeting of 20 February 2007, the 
US confirmed its intention to implement the reco mmendations and rulings of the DSB in the Dispute 
and stated that it would require a reasonable peri od of time to do so as per Article 21.3 of DSU.  
Sufficient time has elapsed since then and Indi a notes that, except abolishing zeroing regarding 
Weighted average -to-Weighted average comparisons in the original investigations, the US continues 
to practice zeroing in other comparison methodologies via transaction to transaction (T-to-T) and 
weighted average to transaction (W-to-T) in the or iginal investigations as such.  Further, the US 
continues to practice zeroing in every comparison me thodology at the stage of administrative reviews 
as such, and sunset reviews as such and is yet to take steps to amend its laws and administrative 
practices in the matter.   
 
4. Mr. Chairman, it is therefore important that this Panel reiterates and reinforces the conclusion 
that practice of Zeroing as stated above is " as such" inconsistent with the obligations under 
GATT, 1994, Anti-Dumping Agreement and the Agreem ent for Establishing the WTO as held by the 
Appellate Body.  Any other conclusion would resu lt in continuance by the United States of the 
zeroing practice, which not only inflates dumping ma rgins, but also detracts from the obligation to 
undertake an objective examination of the impact of dumped imports and finally ascribes dumping 
even in cases where no dumping  may exist.    5. Mr. Chairman, we are convinced that the US w ill eventually be forced to realize the futility of 
pursuing the use of "zeroing".  However, we remain deeply concerned at the impact of their prolonged 
use of this methodology on the credibility and pred ictability of the multilateral dispute settlement 
system.  In view of the settled jurisprudence by th e Appellate Body, we believe that the panel will 
reiterate that practice of "zeroing" by any WTO Member in every comparison methodology during the 
original investigation, periodic or administrative reviews and sunset reviews is inconsistent with 
Members' WTO obligations under the Anti-Dumping Agreement.   WT/DS350/R 
Page D-26  
 
 ANNEX D-7 
 
 
THIRD PARTY ORAL STATEM ENT OF JAPAN AT THE 
FIRST MEETING OF THE PANEL 
 
 Introduction  
1. Mr. Chairman and Members of the Panel, we are pleased to appear before you today to 
present the views of Japan as a third party in this di spute.  Today, Japan woul d like to briefly address 
two issues before the Panel:  (1) measures at issue;  and (2) role of the precedent.   
 Measures at Issue  
 
2. There are two sets of measures which the Eu ropean Communities ("EC") challenges in the 
present dispute.  First one is "the application or  continued application of  specific anti-dumping duties 
resulting from the 18 anti-dumping orders in the Annex to the Panel request as calculated or 
maintained in place pursuant to the most recent admi nistrative review or, as the case may be, original 
proceeding or changed circumstanc es or sunset review proceeding".
1  Second one is "the application 
of zeroing ( i.e., either using the model or simple zero ing technique) as applied in 52 anti-dumping 
proceedings, including original proceedings, admini strative review proceedings and sunset review 
proceedings listed in the Annex to the Panel request".2   
 
3. The first measure above-mentioned is a new kind of measure we have seen in a series of 
zeroing cases in WTO Dispute Settlement System.  Howe ver, Japan considers this is admissible as a 
measure at issue based on the following reasons.    4. Japan considers that the first measure is  specific enough so as to suffice the specificity 
required by Article 6.2 of the Understanding on Rules and Proce dures Governing the Settlement of 
Disputes (the "DSU").  The anti-dumping orders on which the duties are based are identified in the 
Annex to the Panel request.  The applied duties are calculated or maintained by using zeroing 
practice.  It is a well known custom that the zeroing pr actice is continued to be done in the subsequent 
administrative reviews, or, as the case may be, original proceeding or changed circumstances or 
sunset review proceeding.  Therefore, "the app lication or continued application of specific anti-
dumping duties resulting from the 18 anti-dumping orders" can be seen as a measure at issue.    5. With respect to the periodic reviews which we re found to be inconsiste nt with AD Agreement 
and the GATT 1994, in United States – Laws, Regulations and Methodology for Calculating Dumping 
Margins (Zeroing) (DS294) and United States – Measures relating to Zeroing and Sunset Reviews 
(DS322) , the United States argues that the results were  superseded by subsequent reviews in each 
case, and that, therefore, no further action is necessa ry for the United States to bring these challenged 
measures into compliance with the recommendations  and rulings of the Dispute Settlement Body 
("DSB").
3  Japan finds this logic hard to be understood.  This logic undermines the results of the WTO 
dispute settlement system.   
 
6. EC's theory in this case is one of the reas onable approaches to block such kind of argument 
which deteriorates the effectiveness of the WTO dispute settlement system.   
                                                      
1 EC First Submission, para. 34.   
2 Id. para. 35.   
3 WT/DS322/22/Add.2.    WT/DS350/R 
 Page D-27 
 
 
  
Role of the precedent  
 
7. Japan agrees with the EC's argument that "[r] eliance on previous case-law actually flows from 
the necessity to ensure in any legal syst em security, consistenc y and predictability"4 and that, thus, 
"even where previous decisions are not binding per se , reliance on previous case-law is necessary to 
ensure consistency of such case-law, in partic ular where case-law comes from higher courts or 
tribunals".5   
 8. In US – Zeroing (Japan) , the Appellate Body, after delibera ting thoroughly, manifested that 
zeroing procedures are prohibited in any anti-dumpi ng proceedings regardless of methodology of 
calculation of dumping margin.  Japan requests the Panel would respect the above-mentioned 
Appellate Body decision and maintain a consistent lin e of findings on the legal issues of zeroing.  The 
followings are the grounds of Japan's argument.   
9. As the EC argues, (i) findings of the Appella te Body is hierarchically superior and only 
dealing with issues of law, (ii) findings have been  repeated in several cases so that there is now a 
consistent line of interpretation
6.   
 10. Article 3.2 of the DSU sets forth the purpose of the dispute settlement system of the WTO.  This Article provides that "[t]he dispute settleme nt system of the WTO is a central element in 
providing security
 and predictability  to the multilateral trading system" (underline added.)  A 
consistent application of the WTO Agreement to the Members shall be secured within the dispute 
settlement system.  In other words, if the situati on that the legal findings adopted by decision of the 
DSB varies on a case by case basis with regard to the same legal issues, it would lead to unfair or unequal treatment  among Members, which would undermine "secu rity and predictability" of the WTO 
dispute settlement system.  If unfair or unequal treat ment of Members persists, the dispute settlement 
system can not maintain its consistency and it must lose its credibility.    11. On the other hand, Japan also recognizes that the panel does not have to rely on the precedent 
in exceptional circumstances.  Nevertheless, we can find no exceptional circumstances in this dispute 
at all.  It appears that the United States has merely reopened the argument by showing that the 
Appellate Body's decisions concerning zeroing are not persuasive.  Under current circumstances, 
Japan requests the panel to do an "objective assessment
 of the matter" relying on the precedents.  
In this sense, Japan understands  the decision by the panel in Mexico – Stainless , dated 
20 December 2007 is deviated from the above-mentioned standards.    
12. Accordingly, Japan strongly requests that the Panel in this dispute respects the above-
mentioned Appellate Body decision and maintain a consistent line of findings in the dispute 
settlement system.    13. Japan would like to thank the Panel for this  opportunity to raise these issues.  We would 
welcome any questions.   
 
                                                     
 
4 EC First Written Submission, para. 68.   
5 Id.   
6 EC First Written Submission (20 August, 2007), para.106.   WT/DS350/R 
Page D-28  
 
 ANNEX D-8 
 
 
THIRD PARTY ORAL STATEM ENT OF KOREA AT THE 
FIRST MEETING OF THE PANEL 
 
 
Mr. Chairman and Members of the Panel:   
 1. The Republic of Korea ("Korea") appreciates th is opportunity to present its views to the Panel 
as a third party in this important dispute.  Through this statement, Korea provides an overview of the key issues included in Korea's third party submission dated 19 September 2007.   
 
A. A
S THE APPELLATE BODY HAS CONSISTENTLY FOUND , "ZEROING " MUST BE PROHIBITED IN 
ALL ANTI-DUMPING PROCEEDINGS INCLUDING ORIGINAL INVESTIGATIONS , 
ADMINISTRATIVE REVIEWS , AND SUNSET REVIEWS  
2. First of all, Korea notes that in US – Zeroing (Japan) , the most recent Appellate Body 
decision relating to zeroing, the Appellate Body unequivocally held that zeroing in all respects 
violates relevant provisions of the Anti-dumping Agreement ("AD Agreement").1  Korea requests the 
Panel to conform to this unambiguous and clear pr ecedent directly on point and reiterate in this 
dispute that the USDOC's "zeroing" must be prohibited in all anti-dumping proceedings.   
 3. Korea submits that a panel's deference to th e Appellate Body jurisprudence is critical and 
essential to maintain the integrity of the WTO di spute settlement procedure.  Disregarding clear 
precedents of the Appellate Body, in the absence of particular reasons distinguishing the case at hand, 
would erode the cherished trust of Members in the dispute settlement system and undermine the 
stability of the international trading regime.  We al so note that even the United States keep referring 
to prior panel and Appellate Body precedents to ma ke its own arguments.  We find it puzzling how 
the United States would justify its position that each panel is encouraged to depart from the prior 
precedents while it itself devotes significant portion of  its own submission to cite these precedents.  
Korea calls upon the Panel to discharge its oblig ation under Article 11 of the DSU by applying 
relevant precedents reasonably.    B. "Z
EROING " AS USED IN ORIGINAL INVESTIGATIONS , VIOLATES ARTICLES 2.4 AND 2.4.2  OF 
THE AD AGREEMENT  
4. There is an ample body of precedents, where panels and the Appellate Body found that the 
zeroing practice used in an average-to-average co mparison in an original investigation violates 
Articles 2.4 and 2.4.2 of the AD Agreement.  Kor ea also understands that even the United States does 
not contest this issue any more.  In Korea's view, therefore, the Panel could easily render its determination on this issue in the present dispute.   
 
C. T
HE PERIODIC REVIEW UNDER ARTICLE 9.3 IS ALSO GOVERNED BY THE PRINCIPLES OF 
ARTICLES 2.4 AND 2.4.2  AND THUS ZEROING IN THE PERIODIC REVIEWS VIOLATES ARTICLES 
2.4, 2.4.2  AND 9.3 
5. The basic requirement provided for in Article s 2.4 and 2.4.2 is an overarching obligation, 
which applies to all dumping calculations.  To the extent that a dumping margin is effectively 
                                                      
1 See United States – Measures Relating to Zeroing and Sunset Reviews , WT/DS322/AB/R (adopted 
23 January 2007) (" US – Zeroing (Japan) "), at paras. 137-138, 147, 166, 167-169, 177, 186-187.    WT/DS350/R 
 Page D-29 
 
 
 calculated, such obligation must equally apply to  administrative reviews.  Korea notes that dumping 
margin calculation indeed takes place in an administrative review conducted by the USDOC.  By 
adopting the zeroing methodology in administrative reviews, and by failing to abide by the requirements of Articles 2.4 and 2.4.2 in those proceedings, the USDOC therefore violated not only Articles 2.4 and 2.4.2 but also subsequently Article  9.3 with respect to its various administrative 
reviews identified in the EC's first written submi ssion.  The United States makes effort to show why 
administrative reviews are different from original investigations, but as long as artificially manipulated calculations are conducted, there is no reason to distinguish the two.   
 6. Korea submits that administrative reviews as conducted by the USDOC should not and cannot 
be separated from the original investigations, and al most identical calculations and evaluation occur in 
both proceedings.  Korea does not find any reason to treat administrative reviews any differently.  The 
use of zeroing by the United States in the admini strative reviews at issue here, therefore, is 
inconsistent with the AD Agreement in both the calculation of a revised margin of dumping for cash 
deposit purposes and in the calculation of th e amount of duty retrospectively assessed.   
 
D. U
TILIZATION OF ZEROING IN SUNSET REVIEWS ALSO CONSTITUTES VIOLATION AF ARTICLES 
2.4, 2.4.2,  11.1  AND 11.3  OF THE AD AGREEMENT  
7. The same rule should also apply to the sunset reviews.  In light of the above reasoning, to the 
extent the USDOC conducts sunset reviews based  on margins of dumping calculated in previous 
proceedings using the zeroing methodology, it inevitabl y constitutes violations of Articles 2.4, 2.4.2, 
11.1 and 11.3 of the AD Agreement.   
 8. Logically and practically, the sunset reviews of the USDOC cannot be separated from previous anti-dumping proceedings.  Rather, the suns et reviews are simply an extension of previous 
findings to the extent the USDOC relies on dum ping margins calculated in a prior original 
investigation or an administrative review as the basi s for the sunset review's likelihood determination.  
Therefore, Korea believes that the violation of these provisions is also unavoidable.   
  Again, Korea extends its appreciation to the Pa nel for this opportunity to present its views in 
this important dispute.  Thank you.    
 WT/DS350/R 
Page D-30  
 
 ANNEX D-9 
 
 
THIRD PARTY ORAL STATEM ENT OF MEXICO AT THE 
FIRST MEETING OF THE PANEL 
 
 
Mr. Chairman, members of the Panel:   
 1. It is a pleasure to appear before you to pr esent the views of Mexico concerning certain issues 
in this dispute.  Although there are many points  raised by the United States with which Mexico 
disagrees, I would today like to restrict my remark s to a few points that are of specific concern to 
Mexico regarding the use by the United St ates of zeroing in periodic reviews.   
 
2. In particular, I would like to address:  (1) th e importance to this Panel of following the prior 
adopted Appellate Body decisions in this area;  (2) the United States' mischaracterization of the 
Appellate Body decisions as having "shifted" its reasoning over time, when in fact the Appellate 
Body's reasoning has remained consistent;  and (3 ) the United States' continuing confusion between 
the procedural rules that govern the conduct of  review proceedings under Article 9.3 and the 
overarching substantive obligation under Article 9.3 that duty collections under such systems may not 
exceed the margin of dumping determin ed in accordance with Article 2.   
 
The Significance of Prior Appellate Body Decisions 
 3. Mexico agrees with the reasons set out  in the first written submission of the 
European Communities why this Panel should foll ow the findings and conclusions contained in 
previous adopted Appellate Body reports on zeroing.    4. Mexico also agrees with paragraph 2 of th e European Communities' first written submission 
where it is stated that the "as such" WTO inc onsistency of the methodology has already been 
successfully established in US – Zeroing (EC)  and in US – Zeroing (Japan)  and that, pursuant to 
Article 17.14 of the DSU, the United States must be considered to have unconditionally accepted the 
Appellate Body's findings on "as such" zeroing.  Mexi co would like to add that by allowing the "as 
such" claims, the reports of the Appellate Body ser ve the purpose of "preventing future disputes by 
allowing the root of WTO-inconsiste nt behaviour to be eliminated".
1  The actions and submissions of 
the United States in this dispute not only frustrate th is purpose as they contradict clear findings of the 
Appellate Body, but also go counter to the objectiv e of providing security and predictability to the 
multilateral trading system as provided for in Article 3.2 of the DSU.    5. In this dispute, not only are the identical  measures and issues raised the subject of findings 
and conclusions in adopted Appellate  Body reports, the responding party in those previous disputes is 
the same  as the responding party in this dispute – i.e., the United States.  Clearly in these 
circumstances the previous findings and conclusions  of the Appellate Body should be followed.   
 6. At paragraph 29 of its firs t written submission, the United States incorrectly characterizes the 
European Communities' position as follows:   
 
"In essence, the EC is urging the Panel to rubber-stamp those prior reports that are favourable to the EC's position, to disreg ard those panel reports that demonstrate 
that the EC's position is contrary to the ag reed text of the WTO agreements, and to 
                                                     
 
1 Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review , para. 82.    WT/DS350/R 
 Page D-31 
 
 
 ignore the Panel's obligations under Article 11 of the DSU to conduct an objective 
assessment of the matter before it."   
 7. Relying on this characterization, the United States invokes Article 11 of the DSU as support for its position that this Panel must ignore prior, di rectly applicable, adopted  Appellate Body rulings 
and, instead, follow a series of panel decisions that  were never adopted by the DSB and were in fact 
specifically reversed by the Appellate Body.    8. Contrary to the argument of the United States, following prior Appellate Body reports in the circumstances of this dispute is entirely consistent  with Article 11 of the DSU.  The Appellate Body 
has made this clear in its report in US – Oil Country Tubular Goods Sunset Reviews,  where it stated 
that "following the Appellate Body's conclusions in earlier disputes is not only appropriate, but is 
what would be expected from panels, es pecially where the issues are the same".
2   
 9. The United States refuses to acknowledge that  its arguments regarding zeroing have been 
fully and fairly considered by the Appellate Body and, following such full and fair consideration, 
those arguments have been rejected.  The rejec tion of those arguments is supported by detailed 
reasons given by the Appellate B ody in its reports.  Those reports have been adopted.  There is 
absolutely no basis for the United States to conti nue to pursue its arguments and for its continued 
refusal to eliminate its WTO-in consistent zeroing practices.   
 
10. Herein lays the inconsistency with Article 3.2 of the DSU which sets out the central element 
of the WTO dispute settlement system - the secur ity and predictability of the multilateral trading 
system.  If WTO Members and panels refuse to acknowledge adopted Appella te Body reports which 
are directly on point as they are in this dispute, there is no security or predictability.  As in this 
dispute, WTO Members will be caught up in a seemi ngly endless dispute settlement process over the 
same measure.  There is an additional problem.  In  such circumstances, the creation of a series of 
panel reports that diverge in fi ndings and conclusions from those in  adopted Appellate Body reports 
interferes with the prompt settlement of disputes whic h, as recognized in Article 3.3 of the DSU, is 
essential to the effective functioning of the WTO.   WTO Members will be forced to unnecessarily 
appeal findings and reasons that ha ve already been overturned.   
 
11. Mexico respectfully requests that this Pane l put an end to this unnecessary process and follow 
the adopted Appellate Body reports on zeroing.  At it s heart, the United States problem is not with the 
adopted interpretations of the applicable WTO provi sions but with the provisions themselves.  If the 
United States has a concern regarding the provisions of the WTO Agreements, that concern is not a 
proper subject of the dispute settlement process.    Mischaracterization of the Appellate Body Findings 
 
12. In an effort to persuade this Panel to ignor e the prior, directly app licable adopted Appellate 
Body reports regarding simple zeroing, the United States at several points asserts that the reasoning applied by the Appellate Body with respect to  zeroing "has shifted from dispute to dispute".
3  The 
apparent intention is to undermin e the credibility of the Appellate Bo dy's reasoning by suggesting that 
it has been inconsistent, or pe rhaps even contradictory.   
 13. For example, the United States claims in its  First Written Submission that the "exclusive 
textual basis" identified by the Appellate Body fo r the principle that anti-dumping margins must be 
calculated for the product under investigation taken "as a whole" is the reference in the first sentence 
of Article 2.4.2 to the calculation of a weighted average of prices of " all comparable export 
                                                     
 
2 Appellate Body Report, US – Oil Country Tubular Goods Sunset Reviews , para. 188.   
3 See, e.g., First Written Submission of the United States, para. 5.   WT/DS350/R 
Page D-32  
 
 transactions ".
4  The United States asserts that while th e "all comparable export transactions" phrase 
provided the textual basis for that finding in US – Softwood Lumber Dumping (AB)  that margins of 
dumping relate to the product as a whole, the Appell ate Body later "changed its interpretation of that 
phrase" in US – Zeroing (Japan)  and found that the phrase relates solely to transactions within a 
model, and not across models of the product under investigation.   
 
14. Mexico strongly rejects the United States' revi sionist characterization of the Appellate Body's 
reasoning.  Mexico submits that the reasoning applie d by the Appellate Body has been consistent in 
all of the disputes brought before it involving zeroing, starting from the Appellate Body's first 
decision in EC – Bed Linen .  In that case, and all subsequent  cases, the key textual provisions and 
principles that have guided the Appellate Body's deci sions have been the same.  First, is the text of 
Articles VI and VI:2 of the GATT 1994 and Article 2.1 of the Anti-Dumping Agreement  which define 
"dumping" and "margins of dumping" for all purposes under the agreement by reference to the "product" under investigation.  Th e Appellate Body has consistently found in every dispute before it 
that while it may be permissible, or even necessary  in certain circumstances, to conduct multiple 
comparisons at the level of individual transactions  or models, "dumping" and "margins of dumping" 
can exist only with respect to the product under investigation, as defined by the investigating 
authorities, taken as a whole.  Second, the Appellate Body has consistently found that the text of the 
agreements, for example Article 6.10 of the Anti-Dumping Agreement , define "dumping" of the 
product under investigation in reference to indi vidual exporters or producers, not importers or 
individual transactions.  Exporters or producers dump.  Importers do not  dump.  Lastly, the Appellate 
Body has emphasized the need for consistency in the definitions of dumping used throughout the 
agreements.  In particular, the Appellate Body has found that the same imports cannot be found to be 
"dumped" for purposes of injury, but not dumped for purposes of margin calculations, as is implied by 
the United States' position.    
15. While these key principles, all of them te xtually based, have been further explained, 
amplified, and documented in successive disputes as the Appellate Body has responded to the ever-
shifting arguments presented by the United States, th e identification of the principles themselves and 
their textual basis has not shifted.  Th ey are the same principles identified in EC – Bed Linen , in US – 
Softwood Lumber , in US – Zeroing (EC) , and, most recently, in US – Zeroing (Japan) .  They do not 
hinge upon application of Article 2.4.2 or th e existence of the phrase "all comparable export 
transactions".  The United States' claims to  the contrary are simply incorrect.   
 
The Difference Between Duty Collection Systems and "Margins of Dumping" 
 
16. The last point I would like to raise today c oncerns the apparent confusion on the part of the 
United States between duty collection systems and margins of dumping.  The United States argues 
that "[u]nlike investigations, which are subject to  a single set of rules, the AD Agreement provides 
Members with the flexibility to adopt a variety of systems to deal with the assessment phase".
5  The 
United States argues further that since, for exampl e, Article 9.4(ii) provides for the collection of 
antidumping duties on a transaction-specific basis, the Agreement must likewise contemplate and 
support determinations of "margins of dumping" on a transaction-specific basis.6  The United States 
also emphasizes the purported differences in the "fun ctions of investigations  and other proceedings 
under the AD Agreement", asserting that original i nvestigations are concerned with the "existential 
question" of whether margins of dumping exist,  whereas review proceedings under Article 9 are 
focused on "the amount of duty to be assessed on partic ular entries, an exerci se that is separate and 
                                                      
4 Ibid., para. 76.   
5 Ibid., at para, 18.   
6 Ibid., paras. 125-126.    WT/DS350/R 
 Page D-33 
 
 
 apart from the calculation of an overall dumping margin  during the threshold investigation phase of an 
antidumping proceeding".7   
 17. However, the United States is simply wrong to suggest that the AD Agreement imposes a set 
of rules on investigations, but leaves anti-dumpi ng duty assessments to the unfettered discretion of 
members.  Certainly the agreement does provide "flexibility" to members to choose collection 
systems that suit their policy interests – whether they be administered on a retrospective or 
prospective basis.  However – and this is the part that is ignored by the United States – regardless of 
the collection system chosen by a member, any du ty assessments made are subject to the obligation 
imposed by the text of Article 9.3 limiting the amount of such antidumping duty assessment to "the 
margin of dumping as established under Article 2".  This limitation on the amount of duties applies, 
without exception, to all possible duty collecti on systems permitted under the Agreements.   
 18. Properly understood, therefore, the AD Agreement does provide member countries with the flexibility to choose the system used to coll ect anti-dumping duties and impose liability.  That 
flexibility extends to imposing such liability on an  importer-specific or even a transaction-specific 
basis.  However, the assessment of duties under a ll systems remains subject  to the assessment cap 
imposed under Article 9.3, a cap that is determined by the exporter or producers' margin of dumping as determined under Article 2.  As the Appellate Body in US – Zeroing (Japan)  noted "[i]t is open to 
an importer to request a refund if the duties coll ected exceed the exporter's margin of dumping.  
Whether a refund is due or not will depend on the margin of dumping established for that exporter".
8   
 
Conclusion 
 
19. Mexico again thanks this Panel for its servi ce in this matter.  The zeroing issue is of 
significant importance not only to Mexico, but quite obviously to the many other WTO members who 
are participating in this proceeding as Third Parti es or merely observing.  The issues are not new and 
the arguments have been heard several times before .  Simple zeroing as applied by the United States 
is inconsistent with Article VI:2 of the GAT T 1994 and Articles 2.1, 2.4, and 9.3 of the 
AD Agreement.  We urge the Panel to follow the re asoning of the Appellate Bo dy in this regard and 
to rule accordingly in favor of  the European Communities.   
 
Thank you.   
  
                                                     
 
7 Ibid., para. 110.   
8 Appellate Body Report, US – Zeroing (Japan) , para 160.   WT/DS350/R 
Page D-34  
 
 ANNEX D-10 
 
 
THIRD PARTY ORAL STATEM ENT OF NORWAY AT THE 
FIRST MEETING OF THE PANEL 
 
 
1. Norway would like to thank the Members of the Panel for the opportunity to make a 
statement at this meeting, and for opening up this pa rt of the third party session to a public viewing.   
 Mr. Chairman, Members of the Panel,  2. Panels and the Appellate Body have dealt w ith the question of zeroing several times.  The 
Appellate Body has in its previous cases ruled that all forms of zeroing in all forms of proceedings 
under the Anti-dumping Agreement  are prohibited.  This conclusi on is founded on two premises:  
Firstly , that dumping shall be established for the "product as a whole" – which is not the case where 
zeroing is employed.  And secondly , that zeroing is contrary to the "fair comparison" requirement of 
Article 2.4 of the Anti-dumping Agreement .  The Appellate Body has made clear that these arguments 
also apply to reviews, including sunset reviews.   
 3. Norway firmly supports the Appellate Body's  interpretation and careful reasoning with regard 
to zeroing.  The detailed legal arguments are set out  in our written submission, and will therefore not 
be repeated here.    
Mr. Chairman, 
 4. There seems to be no real disagreement as to what
 the Appellate Body has ruled on the issue 
of zeroing.  However, the United States disagrees w ith the content of the rulings, and sets forward 
alternative arguments that it asks th e Panel to adopt – even if the Appellate Body has already rejected 
these arguments on many occasions.  The question, t hus, seems to be to what degree the Panel may 
depart from the former rulings of the Appellate Body.    5. The Panels and the Appellate Body do  not operate under the legal doctrine of stare decisis , 
and the Panel is therefore not formally
 bound to follow previous rulings.  However, in the interest of 
legal certainty, foreseeability and equality before the law, panels and the Appellate Body should not 
depart from precedents laid down in previous cases without very good reasons for doing so.    
 6. The United States suggests that the Pane l should only take into account the legal 
interpretations set out in Appella te Body reports "to the extent that the reasoning is persuasive".
1   
 
7. I would like to make three comments to this:  First , the Appellate Body's interpretation and 
underlying reasoning are, in our view, far more pe rsuasive than the allegations advanced by the 
United States.  Second , applying a subjective st andard of "persuasiveness" does not sit well with a 
system of "lower courts" and "appeal courts" as we  have in the WTO with Panels and the Appellate 
Body.  A basic premise of a system with an appeal  court is that lower judicial bodies defer to the 
judgments of the appeal court.  Third , "persuasiveness" is a very subjective term, which leaves a lot to 
the "eye of the beholder".    8. Rather, if one is to accept that earlier precedents  may in certain cases be overturned, then a far 
more exacting standard must be applied.  In our view there must be "a manifest error of legal 
                                                     
 
1 United States' First Written Submission para. 33.    WT/DS350/R 
 Page D-35 
 
 
 interpretation" before a panel may depart from the legal interpretation of the Appellate Body 
regarding the same legal issue.    9. The panels that have departed from prev ious Appellate Body reports on zeroing have 
thereafter been overturned by the Appellate Body.  It  is thus eminently clear that those panels – and 
not
 the Appellate Body – committed serious errors of legal interpretation.   
 Mr. Chairman,  10. The United States has referred to two previous panels ( US – Zeroing (Japan) and US – 
Stainless Steel from Mexico) in support of its argument that zer oing should be permitted in assessment 
reviews – and that there should be no methodologi cal constraints on how the US calculate dumping 
margins and impose and collect duties.    11. The Panels in those two cases made a number of legal errors, two of which I would like to 
highlight here.  Needless to say we trust that this Panel will not commit the mistakes of the two 
aforementioned Panels.    12. First , those Panels did not interpret the terms "product" or "margin of dumping" in the Anti-
dumping Agreement  in accordance with the Vienna Convention on the Law of Treaties.  This is clear 
from the treatment in those reports.   
 
13. Not only did they misunderstand the very purpose of treaty interpretation, they also ignored the elements of Articles 31 and 32 of  the Vienna Convention.  Rather  than going through the elements 
of these articles they simply jumped at their own interpretation, and thereafter they declared their 
interpretation to be a permissible one.   
 
14. Such an analysis completely  misunderstands the purpose of treat y interpretation.  The purpose 
of treaty interpretation  is to arrive at the one and only interpre tation of a term, in its context, and in 
light of its object and purpose.  To do so, there ar e a number of elements that the treaty interpreter can 
rely upon, as specified in the various sub-paragraphs  of Article 31 and Article 32.  The tests in the 
Vienna Convention are designed to assist the treaty interpreter to arrive at one single interpretation  of 
the term in question.  A correct application of those tests should not allow more than one 
interpretation of a term except in the rarest of cases.    15. Should there still, after  the application of the Vienna Convention, be unclear which of two 
interpretations is the correct one, then the principle of "in dubio mitius" – widely recognized in 
international law as "a supplementa ry means of interpretation" – would direct a treaty interpreter to 
prefer the meaning, which is less onerous  to the party assuming an obligation.   
 16. By stating that there are two permissible in terpretations up-front, those panels committed a 
legal error of treaty interpretation.  By interpre ting "product" and "margin of dumping" as they did, 
they made yet more mistakes.   
 
17. The second  legal error I want to highlight in those panel reports relate to the Standard of 
Review set out in Article 17.6 (ii) of the Anti-dumping Agreement.   
 18. What is important to always bear in mind is that the first sentence of Article 17.6(ii) requires 
a Panel to apply the rules of treaty interpretation of customary international law.  This means to apply 
the rules of the Vienna Convention.  Had the two aforementioned panels applied the Vienna 
Convention correctly, only one interpretation should remain (that of the Appellate Body) – not two 
permissible ones.   WT/DS350/R 
Page D-36  
 
 19. The second sentence of Article 17.6(ii) only kicks in after  all the principles of treaty 
interpretation of public internati onal law have been exhausted, and functions in those rare cases as 
would the application of the principle of " in dubio mitius ".   
 20. Applying the second sentence up-front, before a pplying correctly the Vienna Convention, is a 
grave legal error.   
 21. We are, of course, confident that this Pa nel will not commit the errors of the two panels 
mentioned by the United States.    
Mr. Chairman, Members of the Panel, 
 22. The Appellate Body has rightly pointed out that  adopted reports create le gitimate expectations 
among WTO Members, and therefore should be taken into account where they are relevant to any 
subsequent dispute.
2  Furthermore, the Appellate Body h as underscored that it would be expected 
from panels that they follow the Appellate Body's conclusions in earlier disputes, especially where the 
issues are the same.3   
 23. It cannot be doubted that the case we are discu ssing today involves the sa me factual basis, the 
same methodologies and the same provisions as the Appellate Body's earlier rulings on zeroing.  Hence, it would be expected that this Panel follow the legal interpretations set out by the Appellate 
Body in the mentioned decisions.   
 24. Based on this, Norway respectfully requests th e Panel to examine this case in accordance with 
previous Appellate Body rulings in order to sec ure a legally correct, cohesive and predictable 
outcome.   
 
Thank you for your attention.   
  
                                                     
 
2 Appellate Body Report, Japan – Alcoholic Beverages II , at 108 (as regards adopted panel reports) and 
Appellate Body Report, US – Shrimp (Article 21.5 – Malaysia) , paras. 107-109 (as regards adopted Appellate 
Body reports).   
3 Appellate Body Report, United States – OCTG Sunset Reviews , para. 188.    WT/DS350/R 
 Page D-37 
 
 
 ANNEX D-11 
 
 
THIRD PARTY ORAL STATEMENT OF THE SEPARATE CUSTOMS 
TERRITORY OF TAIWAN, PENG HU, KINMEN AND MATSU  
AT THE FIRST MEETI NG OF THE PANEL 
 
 Mr. Chairman, Members of the Panel:    
 The Separate Customs Territory of Taiwan , Penghu, Kinmen and Matsu, (or TPKM), would 
like to thank the Panel for this opportunity to present our views in this third party session.   
  TPKM stands by its written submission of 19 September, 2007.  Because the mechanisms of 
zeroing have already been fully descr ibed by the parties to the disput e, we are not going to repeat 
them here.  We believe there is common understa nding of how zeroing affects the calculation of 
dumping margins.  Today, we would like to draw th e Panel's attention to the illegitimacy of measures 
as a consequence of their reliance on zeroing.     At the start, may we respectfully remind the Panel that the multilateral trading system under 
the WTO aims at the reduction of trade barriers on a non-discriminatory basis.  While Article VI of 
GATT 1994, which recognizes the legitimacy of anti- dumping measures, is a departure from this 
basic principle, its purpose is clearly stipulated as to "offset" injurious dumping.  For this reason, the 
duty imposed may not be excessive than the margin of  dumping with respect to that specific product.   
  The Agreement on Implementation of Article VI of the General Agreement on Tariffs and 
Trade 1994 states at the outset that Members agree that " An anti-dumping measure shall be applied 
only under the circumstances provided  for in Article VI of GATT 1994 ".  In other words, no anti-
dumping measure shall be applied that is beyo nd the mandate of Article VI of GATT 1994.   
  However, the use of the zeroing method creat es the potential for overcorrecting the injury 
caused by dumping, which places it  beyond the mandate of Article VI of GATT 1994.   
 
 Under the zeroing methodology, the prices of certain export transactions are not taken fully into account.  As the Appellate Body has noted in pr evious disputes, there is an "inherent bias in a 
zeroing methodology".  Such bias could, in some in stances, turn a negative dumping margin into a 
positive one, and may systematically inflate the magnit ude of dumping margins.  It is evident that a 
margin calculated by the zeroing method can never be a legitimate foundation for either the 
determination of dumping or th e assessment of dumping duty.   
  If, for example, an affirmative determination of dumping were made on a product that was not 
being dumped, or a dumping duty was applied at an inflated rate, these measures would inevitably be 
deemed beyond the mandate of Article VI of GATT 1994.   
  It follows that any measure relying on a dumping margin calculated by the zeroing method, whether in investigations or reviews and regard less of the type of comparison employed, would 
necessarily result in an inaccurate determination of dumping or the excessive imposition of dumping 
duty, and as such would be deemed inconsistent with the WTO anti-dumping disciplines.   
 
Mr. Chairman, Members of the Panel:     The objectives of anti-dumping duty are not to cu rb the imports of a product that is not being WT/DS350/R 
Page D-38  
 
 dumped, but to stop a product being imported at dumped prices and to remedy the injury.  To tolerate 
the use of the zeroing method in the calculation of a dumping margin is to deny the very basis and spirit of the anti-dumping mechanism.     TPKM respectfully requests the Panel to take into account its observations and comments.  In 
the interests of ensuring security and predictability in the multilateral trading system, we would expect 
the Panel to make findings and pr oper interpretations consistent w ith the previous findings of the 
Appellate Body.     Thank you for listening to our views.     WT/DS350/R 
 Page D-39 
 
 
 ANNEX D-12 
 
OPENING STATEMENT OF THE EUROPEAN COMMUNITIES  
AT THE SECOND MEETING OF THE PANEL 
 
 
Mr. Chairman, distinguished Members of the Panel:     The EC does not have an opening oral statement.    
 We believe that we have made our case, as it was made in DS294, in DS322 and most 
recently in DS344.     I have two documents in front of me:  the text of the ADA and the text of the Vienna 
Convention, which speak for themselves.  We do not  believe that the submissions we hear coming 
back from the United States – such as the assertion th at the ADA is a hotch potch of obscurity, are 
legal arguments.  And we are anxious to get to an y questions the panel might have.  For this reason, 
we have no opening oral statement.     Thank you, Mr Chairman.   WT/DS350/R 
Page D-40  
 
 ANNEX D-13 
 
OPENING STATEMENT OF THE UNITED STATES  
AT THE SECOND MEETING OF THE PANEL 
 
 
Mr. Chairman, Members of the Panel:    1. The United States welcomes this opportunity to meet with the Panel again to discuss the issues raised in this dispute.  In particular, we  will respond to some of the arguments made by the 
European Communities ("EC") in response to th e Panel's questions and in its second written 
submission.  And we wish to thank you once agai n for opening this panel meeting to WTO Members 
and the public.    2. Today we will first explain why determining the margin of dumping in reviews makes sense 
on a transaction-specific basis.  We will then comme nt on the relevant standard of review, discuss the 
proper role of adopted Appellate Body reports in  the WTO dispute settlement system, and respond to 
the EC's continued attempt to have imposed on the United States an independent international 
obligation to eliminate so-called "zeroing".  Sec ond, we will briefly address our objection that the 
"application or continued application" of duties in  18 separate cases is not properly within the scope 
of this proceeding because the EC's identification of  "duty as a measure" does not identify the specific 
measures at issue as required by Article 6.2 of the Understanding on Rules and Procedures 
Governing the Settlement of Disputes  ("DSU").  Third, we will respond to the EC's argument that 
Article 2.4.2 of the Antidumping Agreement applies to  periodic reviews, refute the erroneous concept 
of "product as a whole", and demonstrate how a the EC's reading of Article 2.4.2 would render the 
targeted dumping provision inutile .  Lastly, we offer a few words on the negotiating history of the 
Antidumping Agreement, which shows that no co mmon understanding to prohibit zeroing could be 
reached in the Uruguay Round and that multiple attemp ts to include a prohibition on zeroing failed.   
 
The US Retrospective Duty System 
 
3. The US retrospective duty assessment system  is more complex to operate, and requires a 
larger expenditure of administrative resources and personnel.  However, it allows US authorities to 
closely calibrate the imposition of antidumping dut ies to the actual levels of dumping during the 
period covered by a periodic review.  In addition,  it encourages exporters and importers to adjust 
prices on their own – either through the exporter reduc ing prices in their home market to bring down 
the "normal value", the importer and exporter agreeing to a higher "export price", or in the case of a 
related importer, if the importer raises its US sales price – in order to eliminate dumping margins and 
avoid paying antidumping duties.  Thus, in the United States the level of antidumping duties actually collected from importers typically declines sharply during the period covered by an order.  This 
means that prices in the market place can adjust without the actual collection of duties.   
 Standard of Review  
 
4. As the parties agree, the task of this Panel is set not only by Article 11 of the DSU, but also 
by the special standard of review found in Artic le 17.6(ii) of the Antidumping Agreement.  Under 
Article 17.6(ii), when a panel, in applying the cust omary rules of interpretation of public international 
law, "finds that a relevant provision of the Agreement admits of more than one permissible 
interpretation, the panel shall find the authorities' me asure to be in conformity with the Agreement if 
it rests upon one of those permissible interpretations".     WT/DS350/R 
 Page D-41 
 
 
 5. The existence of such a provision in th e Antidumping Agreement confirms that WTO 
Members were aware that the antidumping text would pose particular challenges.  In many instances, 
the antidumping text permits more than one interp retation because it was drafted to cover multiple 
antidumping systems around the world and long-stan ding differences regarding methodology.  Thus, 
the negotiators indicated that panels and the Appellate Body should respect a permissible 
interpretation of the Antidumping Agreement, even  if that interpretation would not be the one 
favoured by the panel or Appellate Body.    6. Here, the EC asserts that in applying the custom ary rules of interpretation to the provisions at 
issue, there is no question that the only permis sible interpretation is one  which finds a blanket 
requirement to average together in all types of proceedings the price margins for all import 
transactions of a particular product.
1  The United States has demonstrated that there is no text, nor any 
necessary implication in the text, that establishes an y such general requirement in the Agreement.  As 
the United States has demonstrated, the correct in terpretation, applying the rules in the Vienna 
Convention, is one which does not lead to such  a general requirement.  But even were the 
interpretation proposed by the EC permissible, the interpretation advanced by the United States would 
be equally permissible for purposes of Article 17.6(ii).    
The Role of Adopted Appellate Body Reports 
 
7. The EC would like this  Panel to believe that stare decisis exists in the WTO dispute 
settlement system, at the very least on a de facto  basis.  In its second written submission, the EC 
claims that it "is not arguing that the DSU contains  an express rule providing that panels are legally 
bound" by prior Appellate Body reports, but then asse rts that "panels ... should follow the findings of 
the Appellate Body in prior cases".
2  The EC even appears to argue that the WTO is a common law 
system by referring to the "substantial and consistent case-law of the Appellate Body".3   
 
8. The Appellate Body has stated that its re ports are not binding, except with respect to 
resolving the particular dispute between the parties to that dispute.4  To the extent that the reasoning 
in prior Appellate Body reports is  persuasive, those reports may be taken into account, but they have 
no stare decisis effect.  The Ministerial Conference and the General Council have exclusive authority 
to adopt binding interpretations of the covered agre ements under Article IX:2 of the WTO Agreement.   
 
9. Article 11 of the DSU requires a panel to ma ke an objective assessment of the matter before 
it, including an objective assessment  of the facts and the applicability of and conformity with the 
covered agreements.  And under Ar ticles 3.2 and 19.2 of the DSU, the findings and recommendations 
of a panel or the Appellate Body, or the rulings and recommendations of the DSB, cannot add to or 
diminish the rights and obligations provided in the covered agreements.  A pa nel cannot simply adopt 
prior findings on an issue without undertaking its own objective assessment of the matter before it.  
Nor can a panel follow prior findings if the panel cons iders that those prior findings would add to or 
diminish the rights or obligations of the parties to the dispute before the panel.    10. The panels in US – Zeroing (Japan) and more recently US – Zeroing (Mexico) have rejected 
the rationale of prior Appellate  Body reports finding zeroing in reviews inconsistent with the 
Antidumping Agreement and GATT 1994.
5  Both  panels recognized their obligation to carry out an 
objective assessment under Article 11 of th e DSU.  As the panel concluded in US – Zeroing (Mexico) , 
"[i]n light of our obliga tion under Article 11 of the DSU ... we ha ve felt compelled to depart from the 
                                                      
1 EC Second Written Submission, para. 19.   
2 EC Second Written Submission, paras. 39-40.   
3 EC Second Written Submission, para. 19.   
4 US – Softwood Lumber Dumping (AB) , para. 111 (citing Japan – Alcohol Taxes (AB) and US – 
Shrimp (Art. 21.5)(AB) ).   
5 US – Zeroing (Japan) (Panel) , para. 7.99 and n. 733;  US – Zeroing (Mexico) (Panel) , para. 7.106.   WT/DS350/R 
Page D-42  
 
 Appellate Body's approach".
6  This Panel likewise is charged under Article 11 with undertaking an 
objective assessment of the matter before it and canno t make findings or recommendations that add to 
or diminish the rights and obligations in the covered agreements.    11. Attempting to respond to the US argument that  adopted Appellate Body reports may be taken 
into account to the extent that they are persuasive , the EC asserts that "[e]ither findings in prior cases 
are legally relevant, or they are not".
7  The EC believes that once reports have been adopted by the 
Dispute Settlement Body ("DSB"), they are "legally  relevant" to the dispos ition of a dispute, and no 
other interpretation of the covered ag reements is allowed.  The EC has invented its notion of "legally 
relevant" out of whole cloth:  as just explained, if  a prior report's reasoning is persuasive or helpful, it 
should be taken into account, but that does not mean that a panel is bound by it.   
 12. The EC tries to find support in the text of Article 11 of the DSU for its view on the binding nature of prior Appellate Body reports.
8  An interpretation under the customary rules of treaty 
interpretation supports no such reading.  It is difficult to see how Article 11, which calls for an 
"objective assessment", means that panels should blindly follow adopted Appellate Body reports, 
particularly in light of Article IX:2 of the WT O Agreement by which only the Ministerial Conference 
and General Council may adopt auth oritative interpretations.   
 13. The EC relies on the first senten ce of Article 11, which states that  "the function of  panels is to 
assist the DSB in discharging its responsib ilities under this understanding and the covered 
agreements".
9  To the EC, this sentence means that by  following adopted Appellate Body reports, 
panels will somehow assist the DSB in meeting its responsibilities.  The DSB's role, however, is to 
help Members resolve individual disputes, and not to adopt binding interpretations of the covered 
agreements outside the context of a specific disput e, which would run counter to the prohibition in 
DSU Article 3.2 on adding to Members' obligations.  It is by adopting working procedures, hearing 
the parties, and making findings and recommenda tions on claims that panels help the DSB 
"administer these rules and procedures and ... the cons ultation and dispute settlement provisions of the 
covered agreements".10  The first sentence in Article 11 does not  say or imply anything about a need 
or requirement to follow past Appellate Body re ports, nor does any other provision of the DSU.   
 14. The EC, in interpreting Article 11, also re lies for contextual support on the reference to 
"security and predictability" in Article 3.2 of th e DSU.  However, the re ference to "security and 
predictability" in Article 3.2 does not support the EC's  mis-reading of Article 11.  Rather, Article 3.2 
explains that the dispute settlement system is a cen tral element in providing security and predictability 
to the multilateral trading system .  The dispute settlement system serves that function by following 
both the procedural and substantive rules to which WTO Members have agreed.  That is, the system 
serves that objective when panels make the "objec tive assessment" with which Members have tasked 
them (as opposed to the rote accepta nce of prior reports that the EC urges), and when panels do not 
add to or diminish the rights or obligations of Memb ers.  By contrast, the security and predictability of 
the multilateral trading system is not preserved when a panel or the Appellate Body creates rights or obligations to which the Members did not agree.  When the Appellate Body has departed from the 
proper interpretation of the covere d agreements, as in disputes on zer oing, panels should be mindful 
of the obligation under DSU Article s 3.2 and 19.2 to preserve the rights and obligations of Members 
when interpreting and applying the covered agreemen ts.  Article 3.2 of the DSU therefore does not 
assist the EC's argument with respect to the meaning of Article 11.    
                                                     
 
6 US – Zeroing (Mexico) (Panel) , para. 7.106.   
7 EC Second Written Submission, para. 20.   
8 EC Second Written Submission, para. 26.   
9 EC Second Written Submission, para. 29.   
10 DSU Article 2.1.    WT/DS350/R 
 Page D-43 
 
 
 Article XVI:4 of the WTO Agreement  
 
15. The EC once again repeats its expansive and erroneous argument that under Article XVI:4 of 
the WTO Agreement, the adopted Appellate B ody reports on zeroing impose an "independent 
international obligation" on the United States to eliminate zeroing.11  We will not repeat all of our 
arguments in this regard today12, but emphasize a few key points.  Most importantly, there is no 
support for the EC's interpretation in the DSU or elsewhere in the covered agreements.  The EC's 
proposed interpretation is also inconsistent with  the well-established propositio n that Appellate Body 
and panel reports "'are not binding, except with respec t to resolving the particular dispute between the 
parties to that dispute'".13  The Appellate Body cannot adopt authoritative interpretations of the 
covered agreements, nor can its re ports create an obligation independe nt of the covered agreements.  
Treating prior Appellate Body reports as binding outsi de the scope of the original dispute would add 
to the obligations of the United States and other Me mbers, inconsistent with Articles 3.2 and 19.2 of 
the DSU.    
16. The EC would like the Panel to believe that Articles 3.2, 3.4, 3.8, and 17.14 of the DSU 
actually support its reading of Article XVI:4.
14  The EC's argument distorts the plain text of the DSU.  
As we have just explained, Article 3.2 cannot ju stify a reading of Article XVI:4 that adds to a 
Member's obligations under the covered agreements .  In addition, Article 3.4 only relates to the 
"matter" under consideration in a specific dispute,  and requires that the DSB's "settlement of the 
matter" shall be "in accordance with the rights and obligations under this Understanding and under the 
covered agreements".  In other words, a findi ng under Article XVI:4 that adds to a Member's 
obligations under the covered agreements cannot be  reconciled with Article 3.4.  Article 3.8 is 
concerned with the rebuttal of the presumption of nullification and impairment by the responding 
Member in cases where there is an infringement of  the covered agreements.  The EC is wrong to 
assert that under Article 3.8, "any WTO Member ca n invoke nullification and impairment when an 
infringement has been found and adopted by the DSB".15  Lastly, Article 17.14 only states that an 
adopted Appellate Body report sha ll be "unconditionally accepted by the parties to the dispute", which 
means acceptance of the findings and recommendations in  the context of that specific dispute, and not 
in any and all future disputes that appear to be, or  are asserted to be, similar.  No other reading is 
possible.  And in making its argument, the EC has blatantly ignored prior A ppellate Body language on 
this issue while arguing that Appellate Body findings are binding.   
 
17. The EC argues that "treating [Article XVI:4] as a purely consequential claim when a violation of another measure has been found would render this provision inutile
".16  As panels have recognized, 
there is no "independent" basis for a claim under Article XVI:4.17  Instead, a finding of inconsistency 
with a provision of the covered agreements automatica lly gives rise to a finding of inconsistency with 
Article XVI:4.  Neither panels nor  the Appellate Body have ever treated Article XVI:4 differently.   
                                                      
11 EC Second Written Submission, para. 63.   
12 See, e.g. , US First Written Submission, paras. 157-64.   
13 US – Softwood Lumber Dumping (AB) , para. 111 ( quoting Japan – Alcohol Taxes (AB) ).   
14 EC Second Written Submission, para. 64.   
15 EC Second Written Submission, para. 64.   
16 EC Second Written Submission, para. 66.   
17 US – OCTG from Mexico (Panel) , para. 7.189;  US – Antidumping Act of 1916 (EC) (Panel) , 
para. 6.223;  US – Antidumping Act of 1916 (Japan) (Panel) , para. 6.287.   WT/DS350/R 
Page D-44  
 
 Scope of this Dispute 
 
18. The United States will not repeat today its th ree preliminary objections to the scope of the 
EC's claims.  Instead, we will focus on one set of alleged "measures" that are the subject of the US 
objection that under Article 6.2 of the DSU, the EC  has failed to identify the specific measures at 
issue.  Those alleged "measures" are the so-cal led "application or cont inued application" of 
antidumping duties pursuant to the antidumping duty orde rs in 18 cases as identified in the EC's panel 
request.    19. The EC has introduced the concept of "duty as a measure".
18  It now would like the Panel to 
treat any application or continued application of duties – at whatever level and whenever and however 
determined – in the 18 identified cases as some type of free-standing measure that has a life of its own 
beyond the 52 particular determinati ons identified in its panel request.19  The EC ignores the fact that, 
for any given importation, the antidumping dut y imposed or assessed depends on a particular 
administrative determination, whether that be an  original investigation, assessment review, new 
shipper review, or changed circumstances review.  Separately, the continued existence of an 
antidumping duty order depends on an  underlying sunset review.20  In other words, individual 
determinations are the focus of dispute settleme nt because the duty asses sed, or the decision to 
continue imposing that duty pursuant to an antid umping order, is dependent on the actions of the 
administering authority in the relevant proceeding.    
20. The EC's panel request, to fulfil the require ments of DSU Article 6.2, must identify the 
specific determination leading to the particular app lication or continued appli cation of an antidumping 
duty, and cannot merely refer to the application or continued application of a duty in a general and 
detached way.  The EC did not identify such dete rminations, nor could it have, because, by its own 
admission, the EC is trying to sweep in any subseque nt and not-yet-taken determinations related to the 
application or continued application of duties in 18 cases.
21  As prior panels have recognized, a 
measure that did not even exist at the time of panel establishment ca nnot be within a panel's terms of 
reference.22  Nor can the EC have consulted on a measure that does not exist at the time of the 
consultation request, yet such consultations on a measure are a precondition for requesting a panel 
with respect to that measure.23  This Panel should reject the EC's attempt to include in the scope of 
this proceeding indefinite subsequent measures that did not exist at the time of panel establishment.   
 
21. My colleague will now discuss issues rela ted to the EC's claims under the Antidumping 
Agreement and the GATT 1994.    
Article 2.4.2 of the Antidumping Agreement 
 
22. The EC has focused much attention on the alleged proper reading of Article 2.4.2 of the 
Antidumping Agreement under the Vienna Convention.  It is the EC's position that any time a 
Member makes "a systemic examination or inquiry " as to dumping, that Member is conducting an 
investigation subject to the disciplines of Article 2. 4.2.  Such an approach fails to appreciate the 
fundamental distinctions between in vestigations that determine the existence  of dumping, and 
assessment reviews in which final liability is determined, even though  such distinctions are 
recognized in the Antidumping Agreement.   
                                                     
 
18 EC Answer to Panel Question 1(a), para. 7;  EC Second Written Submission, paras. 54, 57.   
19 EC Answer to Panel Question 2, para. 17;  see also EC Answer to Panel Question 2, para. 13;  EC 
Answer to Panel Question 3, para. 20;  EC Answer to Panel Question 5(b), para. 28.   
20 AD Agreement, Articles 1, 5, 7, 9, 11.   
21 EC Response to Request for Preliminary Rulings, para. 47.   
22 US – Upland Cotton (Panel) , paras. 7.158-7.160.   
23 DSU Art. 4.7.    WT/DS350/R 
 Page D-45 
 
 
 23. The requirements of Article 2.4.2 of th e Antidumping Agreement do not extend beyond 
Article 5 investigations.  It is only "during" an Article 5 "investigation phase", that a Member 
establishes "the existence of margins of dumping".24  The US interpretation, applying the rules of 
interpretation as reflected in Article 31 of the Vie nna Convention, is supported by the text of the 
Antidumping Agreement.  Articles 1, 2.4.2 and 5, r ead together, establish that a unique determination 
as to the "existence" of dumping is made in Artic le 5 investigations.  Outside of the Article 5 
investigation phase, the task of an authority is not to determine whether dumping "exists".  Instead, 
the Antidumping Agreement provides that in Artic le 9.3.1 assessment proceedings challenged by 
the EC, the task of the United States is to dete rmine "the amount of the anti-dumping duty" and the 
"final liability for payment of anti-dumping duties".   
 
24. To read, as the EC would ha ve it, "during the investigation phase" as synonymous with 
"period of investigation", denies meaning to the unique "investigation phase" terminology in 
Article 2.4.2.  Although numerous provisions in the Antidumping Agreement refer, for example, to 
the "period of investigation", the term "investigation phase" appears onl y in Article 2.4.2.  The word 
"phase" in the context of the Antidumping Agre ement recognizes that authorities will determine 
dumping margins in distinct contexts.  Specifically, the "investigation phase" refers to the distinct 
phase in which the existence of dumping sufficient to justify the imposition of  an antidumping duty is 
determined.  The relationship between the term "inve stigation phase" and "the existence of margins of 
dumping" must be given meaning and may no t be read out of the Agreement.   
 
25. Because Article 2.4.2 is, by its terms, limit ed to establishing the existence of margins of 
dumping "during the investigation phase", it has no bearing on any segment of an antidumping proceeding other than the original investigati on phase.  Under Article 9.3, the collection and 
assessment of antidumping duties on specific entri es has a separate and distinct purpose that 
necessarily occurs after the imposition of an antidumpi ng duty order in the original investigation.   
 
26. To force the requirements of Article 2.4.2 with respect to the existence  of margins of dumping 
during the investigation phase, into Article 9.3 , the EC seeks to impose an obligation whereby 
dumping liability would be determined on an  exporter-wide basis in assessment reviews.
25  This 
approach divorces the amount of antidumping dut y assessed on an import from the dumping margin 
associated with that import transaction.  Nothing in th e text of Article 9.3 supports such a result.   
 
27. Interpreting Article 9.3.1 to require that fi nal liability be assessed based on the totality of the 
exporter's transactions ignores a key commercial reality.  In the real world, it is the importers  to 
whom the sales at less than normal value are ma de, and it is the importers who actually pay the 
antidumping duties.  This commercial reality is rec ognized explicitly in Article 9.3.2, and implicitly 
throughout Article 9.3.  This cannot be ignored if the antidumping duties are to be an effective remedy 
to "offset or prevent" dumping.    
The Erroneous Concept of "Product as a Whole"  
 
28. The EC's erroneous argument that zeroing is prohibited depends on margins of dumping 
calculated in periodic reviews relating solely and ex clusively to the "product as a whole" – and that 
margins of dumping not be calculated based on individual transactions.  The concept of "product as a 
whole", however, was originally derived from the phrase "all comparable export transactions" in the 
first sentence of Article 2.4.2.  The Appellate Body in US – Softwood Lumber Dumping based its 
finding on the phrase "all comparable export transactions" by interpreting the term "margins of 
dumping" and the "all comparable export tran sactions" language in an "integrated manner".
26  B y  
asserting that the "obligation not to zero primarily de rives from the requirements in Article VI of the 
                                                      
24 AD Agreement, Article 2.4.2.   
25 EC Second Written Submission, paras. 117,119;  EC Answer to Panel Question 8, para. 45.   
26 US – Softwood Lumber Dumping (AB) , paras. 85-93.   WT/DS350/R 
Page D-46  
 
 GATT 1994 and in Articles 2.1 and 9.3 of the Anti-Dumping Agreement ", but not Article 2.4.2
27, 
the EC applies "product as a whole" in a manner that  is detached from the underlying textual basis in 
the first sentence of Article 2.4.2 of the Antidumping Agreement.    29. Furthermore, the EC's own arguments prove too much.  The EC states:  "Thus, it is only on 
the basis of aggregating all these 'intermediate valu es' that an investigating authority can establish 
margins of dumping for the product under investigation as a whole".
28  And the EC further states:  
"The European Community fails to see how margin s of dumping can properly be established for the 
product as a whole without aggregating all of the 'results' of the multiple comparisons".29  If that were 
true, then a margin of dumping coul d never be determined for there c ould always be another import to 
average into the margin.  If anythi ng less than all transactions is not a proper margin of dumping, then 
when would an administering authority have a ll the transactions?  The Antidumping Agreement does 
not specify a particular time period that may be u sed to define the universe of transactions to be 
averaged.  If it is necessary to aver age "all" the transactions, then firs t, the margin would always be 
changing as new transactions were averaged together  with all transactions since the beginning of the 
antidumping duty order.  And second, the margin woul d never be final as there could always be new 
import transactions occurring that would need to be averaged in.  Similarly, in considering 
Article 9.3.1 and 9.3.2, how could an importer ever  know whether to ask for a refund when the margin 
of dumping is continually changing?  And for impor ts during what period of time would the importer 
make such a request?  In order to determine the margin of dumping, all the exporter's transactions 
would need to be averaged, not just with respect to that importer, and the list of transactions would 
never close.   
 30. Because of this problem, we should note that if negotiators had intended to use the "product 
as a whole" approach advocated by the EC, then th ey would have had to have specified the time 
period to consider.  The simple fact that the nego tiators did not deal with this time period issue is 
itself sufficient to show that the EC's approach is not provided for in the text.   
 31. Another fundamental problem with the EC's pr oposed "product as a whole" approach is that it 
is contrary to the way in which "product" is used  in discussing antidumping duties.  Other panels have 
correctly rejected the "product as a whole" approach by looking at the way in which "product" is used 
in Article VII of the GATT 1994.  Perhaps even more di rectly relevant is the use of the term "product" 
in Article II:2 of the GATT 1994.   There, it provides that:   
 
Nothing in this Article shall prevent an y contracting party from imposing at any 
time on the importation of any product:    
... 
 
(b) any anti-dumping or countervailing duty applied consistently with the provisions of Article VI.   
 Here, the term "the importa tion of any product" must mean a partic ular transaction.  A Member would 
not impose a duty on "the importation of any product as a whole".  A duty imposed on "the 
importation" refers to the particular transaction.  And we would note that this is the same manner in 
which product is used in Article II:1.  Under th e EC's reading that "product" means "product as a 
whole", a Member could impose higher ordinary customs duties on some transactions and lower 
duties on others and not breach the Member's tari ff binding as long as the average of the ordinary 
customs duties applied to all transactions was less than the bound rate.   
 
                                                     
 
27 EC Second Written Submission, paras. 117-18.   
28 EC Second Written Submission, para. 80.   
29 EC Second Written Submission, para. 81.    WT/DS350/R 
 Page D-47 
 
 
 Targeted Dumping  
 
32. While the targeted dumping provision might be an exception to the normal rules for establishing the existence of margins of dumping in Ar ticle 2.4.2, it is not an exception to the fair 
comparison requirement of Article 2.4.  If zeroing is  found to violate the fair comparison requirement 
of Article 2.4, as the EC advocates, then such a prohibition would also apply to the methodology 
listed in the second sentence in Article 2.4.2.  Unde r the EC's interpretation, which would require the 
averaging of all transactions for any calculation of the dumping margin, the result under the targeted dumping provision is mathematically equivalent to the result under the first sentence of Article 2.4.2, 
thus rendering the targeted dumping provision a nullit y.  This outcome is to be avoided under the 
customary rules of treaty interpretation.   
 33. The EC does not deny the result of mathematic al equivalence if zeroing is prohibited in both 
symmetrical and asymmetrical comparisons.  Rather , the EC suggests that in a targeted dumping 
scenario, a Member might remedy the mathematical equivalency problem by "re-set[ting] the 
parameters of the investigation"
30 and only calculating a margin for transactions falling within the 
pattern.  There is no textual support for this proposed interpretation, and it is flatly inconsistent with 
the EC's insistence that a margin of dumping may only be calculated for the totality of the exporter's sales, i.e., "the product as a whole".  The language  of Article 2.4.2 says nothing about selecting a 
subset of transactions when conducti ng a targeted dumping analysis.  In other words, to the extent that 
there is any obligation to calculate a margin of  dumping for the "product as a whole", or on an 
exporter-wide basis, as the Appellate Body has fou nd, nothing in the text of the second sentence of 
Article 2.4.2 creates an exception to that obligatio n.  Instead, the second sentence is only an exception 
to the first sentence's obligation to normally make symmetrical comparisons in an investigation.   
 
Uruguay Round Negotiating History 
 
34. During this dispute, the EC, in support of its  argument that zeroing must be prohibited, has 
relied on a revisionist version of the negotiating history.
31  The key terms that have been cited by the 
Appellate Body in its zeroing reports for the most  part date back to the GATT 1947, the Kennedy 
Round Antidumping Agreement, and the Tokyo Round Antidumping Code.  The only new language is the phrase "all comparable export transactions" in Ar ticle 2.4.2, which is lim ited to investigations 
and thus should not be at issue here.  The rest were part of long-standing antidumping terminology, 
which the negotiators turned to when devel oping the WTO Antidumping Agreement.  As the 
negotiating history makes clear, these terms di d not acquire a new meaning during the Uruguay 
Round.    
35. During the Uruguay Round, the negotiators were well aware of zeroing, or as it was referred 
to at the time – "negative dumping".  While the negotiations were underway, Japan and Brazil challenged the EC's zeroing practices in two disp utes under the Tokyo Round Antidumping Code.  In 
both cases, panels found that the Code did no t prohibit zeroing.  Several Members submitted 
proposals during the Uruguay Round, including deta iled textual changes, designed to require WTO 
Members to consider "negative dumping" or "non -dumped transactions".  None of their textual 
proposals appeared in the final Uruguay Round Anti dumping Agreement.  Instead, the provisions of 
the Antidumping Agreement that are at issue here reflect standard language from prior agreements 
that were interpreted by Tokyo Round Code disp ute settlement panels as not  requiring consideration 
of "negative dumping" or aggregation of individual transactions.   36. The lack of any explicit textual referen ce in the Antidumping Agreement to zeroing or 
"negative dumping" speaks for itself.  No comm on understanding was reached on prohibiting zeroing 
in the Uruguay Round.  No common understanding c ould be reached because, despite extensive 
efforts by some Members, their proposals were fi rmly opposed by the United States, Canada – and 
                                                     
 
30 EC Second Written Submission, paras. 116, 246.   
31 See, e.g. , EC Second Written Submission, paras. 221-24.   WT/DS350/R 
Page D-48  
 
 even the EC – Members who continue to use zeroing today, either by assessing antidumping duties on 
an import-specific basis, or, in the case of the EC , pursuant to the application of the "targeted 
dumping" provision in Article 2.4.2.    
Conclusion  
 
37. Mr. Chairman, Members of the Panel, the EC h as asked this Panel to read an obligation into 
the Antidumping Agreement and GATT Article VI, notw ithstanding the lack of any textual basis for 
the obligation the EC proposes.  The United States respectfully urges the Panel to reject the EC's 
claims.  Dispute settlement plays a major role in the WTO system, but it cannot, and should not, seek 
to substitute for the WTO Members, who ultimately must bear the final responsibility for negotiating 
agreements to further open markets and strengthen the global trading system.  If WTO Members left 
out certain provisions for lack of consensus, Article 3.2 of the DSU makes it plain that it is not the job 
of panels or the Appellate Body to write them into  the Agreement.  Indeed, interpretations that go 
beyond the existing text of the WTO agreements – whatever the good intentions of those advancing 
the interpretations – fundamentally undermine the willingness of Members to agree to further market-
opening commitments as some Members will simply  refuse to negotiate mutually beneficial 
commitments and instead seek unilateral gain through the dispute settlement system.   
 38. This concludes our opening statement.  We would be pleased to respond to any questions you 
may have.   
 
  WT/DS350/R 
 Page D-49 
 
 
 ANNEX D-14 
 
CLOSING STATEMENT OF THE EUROPEAN COMMUNITIES  
AT THE SECOND MEETING OF THE PANEL 
 
 
Mr. Chairman, distinguished Members of the Panel:     The EC requests the panel to make a suggestion under the second sentence of Article 19(1) of the DSU, not, as is typically done, in order to ma ke a substantive proposal to the defending Member 
as to how to implement – such as withdrawing th e measure.  But rather to avoid unnecessary 
discussions about what might or might not fall within the scope of a compliance panel.  In particular, 
we would like the panel to suggest to the US th at, when implementing, the US should take all 
necessary steps of a general or particular nature to ensure that any further specific action against 
dumping by the US in relation to the same products from the EC as referenced in the present dispute, 
be WTO consistent, and specifically with reference to  the question of zeroing.  We believe that such 
suggestion might considerably reduce the need for protracted and unnecessary discussions about the 
scope of any compliance panel, and thus fac ilitate the further work of the panel.   
  Thank you, Mr Chairman.    
 WT/DS350/R 
Page D-50  
 
 ANNEX D-15 
 
CLOSING STATEMENT OF THE UNITED STATES  
AT THE SECOND MEETING OF THE PANEL 
 
 
Mr. Chairman, Members of the Panel:    1. The United States would like to thank the Panel fo r its hard work and for its questions today.  
We also would like to thank the Panel again fo r opening the meeting to WTO Members and to the 
public.  The United States appreciates these steps to wards greater transparency at the WTO.   
 2. The United States will be brief but would like to emphasize a few points in closing.    3. The United States strongly objects to the EC's attempt to have the Panel consider as measures 
at issue the "application or continued application" of antidumping duties in 18 separate cases.  The EC 
never included these alleged measures as part of it s consultation request, and the United States was 
denied the opportunity to consult with the EC on them .  The EC appears to have used the time after its 
consultation request to devise a theory on how to ge t at antidumping determinations not yet taken by 
the United States, and it then introduced the so -called "18 measures" in its panel request.   
 
4. These alleged measures cannot properly be before  the Panel under Article 6.2 of the DSU.  
The EC would like the Panel to tr eat the duties as some sort of organism, with a life of its own, 
stretching into the indefinite future.  However, the EC ignores the fact that the duty imposed or 
assessed depends on the underlying administrative determ ination, whether an original investigation, 
an administrative review, a changed circumstances review, or a new shipper review.  The EC had to 
identify the specific determination in its panel request  that resulted in a given application or continued 
application but could not do so because these determina tions were not even in existence at the time of 
panel establishment.  The "application or continue d application" of antidumping duties cannot fall 
within the Panel's terms of reference and should be rejected.    5. We would now like to say a few words about the EC's substantive zeroing claims.  The EC 
has repeatedly emphasized its arguments on the appli cation of the Vienna Convention.  It has accused 
the United States of neglecting the customary rules of interpretation of public international law, just 
because we have not always said the words "Vienna Convention".  However, as demonstrated in our 
written submissions, at the first panel meeting, and before you today, we have applied the customary 
rules of interpretation to the covered agreements .  The ordinary meaning of the text of the 
Antidumping Agreement and GATT 1994 makes clear that  there is no general prohibition on zeroing.  
To find such a prohibition where there is none w ould add to the US obligations under the covered 
agreements, inconsistent with Articles 3.2 and 19.2 of the DSU.    6. The United States would like to remind the Panel of its obligation to make an objective 
assessment under Article 11 of the DSU.  Other pa nels, in doing so, have found that there is no 
prohibition on zeroing in periodic reviews.  We hope  that this Panel will find the same, as a proper 
interpretation of the covered agre ements would lead it to do.   
 7. Thank you again, Mr. Chairman, and members of the Panel.    
 
 
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