WORLD TRADE  
ORGANIZATION  WT/DS417/7 
6 January 2011 
 
 (11-0013) 
 Original:   Spanish 
  
 
DOMINICAN REPUBLIC - SAFEGUARD MEASURES ON IMPORTS OF 
POLYPROPYLENE BAGS AND TUBULAR FABRIC 
 
Request for the Establishment of a Panel by Honduras
 
 
 
 The following communication, dated 20 Decem ber 2010, from the delegation of Honduras to 
the Chairman of the Dispute Settlement Body, is circulated pursuant to Article 6.2 of the DSU. 
 
_______________ 
 
  On 18 October 2010, Honduras requested cons ultations with the Dominican Republic 
pursuant to Article 4 of the Understanding on Ru les and Procedures Governing the Settlement of 
Disputes (DSU), Article XXII of the General Agreement on Tariffs and Trade 1994 (GATT 1994), 
and Article 14 of the Agreement on Safeguards co ncerning the provisional and definitive safeguard 
measures imposed by the Dominican Republic on impor ts of polypropylene bags and tubular fabric 
and the investigation that led to the imposition of those measures.   Honduras and the Dominican Republic held c onsultations on 16 and 17 November 2010.  
Unfortunately, these consultations failed to settle the di spute.  Accordingly, pursuant to Article 6 of 
the DSU and Article 14 of the Agreement on Safeguar ds, Honduras requests that at its next meeting, 
scheduled for 25 January 2011, the Dispute Settlement  Body establish a panel with the standard terms 
of reference as set out in Article 7.1 of the DSU to  examine this matter and the claims set forth below. 
 A. B
ACKGROUND AND MEASURES AT ISSUE  
 The measures at issue were imposed pursuant to an investigation conducted by the Regulatory 
Commission on Unfair Trade Practices and Safe guard Measures of the Dominican Republic 
(hereinafter "the Commission").  
1. Initiation of the safeguard investigation 
 On 15 December 2009, at the request of the comp any Fersan S.A. (hereinafter "Fersan"), the 
Commission declared the initiation of an investigati on with a view to the application of safeguard 
measures on imports from all origins of polyprop ylene bags and tubular fabric classified under 
subheadings 5407.20.20, 6305.33.10 and 6305.33.90 of the Tariff of the Dominican Republic (hereinafter "the initiating resolution").
1  On 17 December 2009, the Commission published a notice 
of initiation of an investigation.2 
 
                                                      
1 Commission Resolution CDC-RD-SG-046-2009 of 15 Dece mber 2009;  initial technical report of the 
Commission dated 20 November 2009. 
2 Notice, general safeguard investigation concerning textiles of man-made filament yarn and bags of 
polyethylene and polypropylene, dated 15 December 2009. WT/DS417/7 
Page 2  
 
  2. Preliminary determination 
 On 16 March 2010, the Commission decided to impose a provisional safeguard of 38 per cent 
on imports of polypropylene bags and tubular fa bric classified under subheadings 5407.20.20 and 
6305.33.90 of the Tariff of the Dominican Republic.  It was also decided to exclude from the application of the measure imports from Mexi co, Panama, Colombia and Indonesia pursuant to 
Article 9.1 of the Agreement on Safeguards.
3  The duration of the provisional safeguard measure was 
200 days.  On 25 March 2010, the Commission published a notice of application of provisional measures on imports of polypropyl ene bags and tubular fabric.
4 
 
3. Final determination 
 On 5 October 2010, the Commission decided to  impose a definitive safeguard of 38 per cent 
on imports of polypropylene bags and tubular fa bric classified under subheadings 5407.20.20 and 
6305.33.90 of the Tariff of the Dominican Republic.5  The Commission then issued a notice of 
application of the definitive measures on impor ts of polypropylene bags and tubular fabric.6  In that 
notice and in the final resolution, the Commission pointed out that pursuant to Article 9.1 of the 
Agreement on Safeguards, the definitive safeguard measure would not apply to imports from Mexico, 
Panama, Colombia and Indonesia.  The measure is being applied for 18 months starting on 
18 October 2010.   Thus, for Honduras, the measures at issue cover all of the resolutions, technical reports and 
notices mentioned above as regards the actions and omissions of the authorities of the 
Dominican Republic during the investigation and im position of the safeguard measures, including the 
methodology, calculations, comparisons, determ inations, procedures or general practices. 
 B. L
EGAL BASIS FOR THE COMPLAINT  
 Honduras notes that according to Article 11.1(a) of the Agreement on Safeguards, a Member 
shall not take or seek a safeguard action unless su ch action conforms with the provisions of 
Article XIX of the GATT 1994 applied in accordance with the Agreement on Safeguards.  In this 
connection, Honduras considers that:  
(a) The Commission's preliminary and final dete rminations do not contain reasoned and 
adequate findings and conclusions with resp ect to the various relevant factual and 
legal aspects of the determin ations relating to the produc t under investigation, the 
domestic like product, and the domestic industr y, and this affects the determinations 
of increased imports, serious injury a nd causality that stem from those prior 
determinations.  These omissions are inconsistent with Articles 2.1, 3.1, 4.1(a), 4.1(c), 4.2(a), 4.2(b), 4.2(c) and 6 of the Agreement on Safeguards, and 
Article XIX:1(a) of the GATT 1994. 
                                                     
 
3 Resolution CDC-RD-SG-061-2010 of the Regulatory Commission on Unfair Trade Practices and 
Safeguard Measures of the Dominican Republic, dated 16 March 2010 ("Preliminary Resolution").  Addendum 
to Resolution CDC-RD-SG-061-2010 dated 16 March 2010 deciding on the application of the provisional 
measures requested by Fertilizantes Santo Domingo, C.  Por A. (FERSAN) in the Polypropylene Bags and 
Tubular Fabric  case, dated 30 March 2010;  Preliminary tec hnical report of the Commission (without date). 
4 Notice, general safeguard investigation concer ning tubular fabric and polypropylene bags, 
25 March 2010. 
5 Resolution CDC-RD-SG-089-2010 of the Regulatory Commission on Unfair Trade Practices and 
Safeguard Measures of the Dominican Republic, dated 5 October 2010 ("Final Resolution");  Final technical 
report of the Commission, dated 13 July 2010. 
6 Notice, general safeguard investigation concerning tubular fabric and polypropylene bags, dated 
6 October 2010.  WT/DS417/7 
 Page 3 
 
 
  (b) The preliminary and final determinations  do not contain reasoned and adequate 
findings and conclusions regarding the a lleged unforeseen developments and to 
explain how those developments resulted in increased imports of the specific products covered by the safeguard measure.  These omissions are inconsistent with 
Articles 3.1, 4.2(a), 4.2(b), 4.2(c), 6 and 11.1(a) of the Agreement on Safeguards and 
Article XIX:1(a) of the GATT 1994. 
(c) Moreover, the preliminary and final dete rminations do not contain reasoned and 
adequate findings and conclusions with respect  to the alleged effect of the obligations 
incurred under the GATT 1994, and how that effect would have resulted in increased imports of the specific products covered by  the safeguard measure.  These omissions 
are inconsistent with Articles 3.1, 4.2( a), 4.2(b), 4.2(c), 6 and 11.1(a) of the 
Agreement on Safeguards and Artic le XIX:1(a) of the GATT 1994. 
(d) Nor do the preliminary and final determin ations contain reasoned and adequate 
findings and conclusions with respect to the alleged increase in imports of the specific 
products under investigation, in absolute terms or relative to domestic production.  
These omissions are contrary to Articles 2.1, 3.1, 4.2(a), 4.2(b), 4.2(c), and 6 of the 
Agreement on Safeguards and Artic le XIX:1(a) of the GATT 1994. 
(e) Furthermore, although the state of the domes tic industry was found to be favourable, 
the preliminary and final determinations  do not contain reasoned and adequate 
findings and conclusions as to the existence of the alleged serious injury, understood 
as significant overall impairment of the domestic industry.  Nor does the preliminary 
determination contain any reasoned and ad equate findings and conclusions with 
regard to the critical circumstances to justif y the provisional measure, or with regard 
to all of the factors that are required to be  examined for the determination of serious 
injury.  These omissions are inconsistent with Articles 2.1, 3.1, 4.1(a), 4.2(a), 4.2(b), 4.2(c) and 6 of the Agreement on Safe guards and Article XIX:1(a) of the 
GATT 1994. 
(f) Nor, at the same time, do the preliminary and final determinations contain reasoned 
and adequate findings and c onclusions regarding the causal link between the alleged 
increase in imports and the serious injury to  the domestic industry.  In particular, 
these determinations do not contain the anal ysis substantiating the causal relationship 
between the alleged increased imports and the alleged serious injury to the domestic 
injury.  Nor is it explained how the injury to the domestic industry caused by factors 
other than imports was not attributed to the imports of the products under 
investigation.  These omissions are contrary to Articles 2.1, 3.1, 4.1(a), 4.2(a), 4.2(b), 
4.2(c) and 6 of the Agreement on Safe guards and Article XIX:1(a) of the 
GATT 1994. 
(g) The measures at issue do not exempt all of the developing countries whose share of 
imports does not exceed 3 per cent.  More over, the required parallelism between the 
substantive evaluation of the determinations of increased imports, serious injury and causal link on the one hand, and the coverage of the measures at issue as regards origin on the other, was not respected.  These omissions are inconsistent with 
Articles 2.1, 2.2, 4.2(a), 4.2(b), 4.2(c), 5. 1, 6 and 9.1 of the Agreement on Safeguards, 
and Article XIX:1(a) of the GATT 1994. 
(h) The preliminary and final determinations do not contain any reasoned and adequate 
findings and conclusions as to the reasons wh y certain information was considered to 
be confidential without requiring non-confid ential summaries or why that information WT/DS417/7 
Page 4  
 
  could not be summarized in a non-confidential manner.  These omissions are contrary 
to Articles 3.1 and 3.2 of the Agreement on Safeguards. 
(i) The preliminary and final determinations do not contain any reasoned and adequate 
findings and conclusions as to the need for the safeguard measure to facilitate 
adjustment of the domestic industry.  This omission is inconsistent with Articles 3.1, 
4.2(c), and 5.1 of the Agreement on Safeguards. 
(j) The resolutions and reports made public  concerning the preliminary and final 
determinations do not contain the reasoned and adequate findings and conclusions on 
all issues of fact and law supporting the impos ition of the measures in question.  This 
omission is inconsistent with Articles 3.1 and 4.2(c) of the Agreement on Safeguards. 
(k) Finally, the Dominican Republic failed to provide the Members having a substantial 
interest as exporters of the products con cerned adequate opportunity for consultations 
prior to the adoption of the definitive measu re.  Nor did the Dominican Republic seek 
to agree on any adequate means of trade co mpensation for the adverse effects of the 
measures on the trade of other Members.  This omission is inconsistent with 
Articles 8.1 and 12.3 of the Agreement on Safeguards and Article XIX:2 of the 
GATT 1994. 
 In any case, Honduras considers that: 
 
(l) The measures at issue are inconsistent with Article I:1 of the GATT 1994 in that they 
are measures that are not applied to pr oducts originating in or consigned from 
particular origins, and this constitutes an advantage that has not been accorded 
immediately and unconditionally to other WTO Members. 
(m) Moreover, the measures at issue are duties and charges other than ordinary customs 
duties that are contrary to Article II:1(a) and the second sentence of Article II:1(b) of 
the GATT 1994. 
 In view of the foregoing, Honduras requests th e Dispute Settlement Body to establish a panel 
with the standard terms of reference as set out in  Article 7.1 of the DSU to examine this matter and 
the above-mentioned claims.   In view of the 18-month period of validity of the definitive safeguard measure and to ensure 
that the dispute settlement system provides an eff ective solution to this di spute, Honduras hopes that 
the panel will issue the final report to the parties as  soon as possible, and in any case not later than the 
period of six months from the date that the comp osition and terms of reference of the panel were 
agreed upon, as stipulated in Article 12.8 of the DSU.  
__________