WORLD TRADE  
ORGANIZATION  WT/DS350/R 
1 October 2008 
 
 (08-4545) 
 Original:   English 
  
 
     
 
    
 
  
UNITED STATES – CONTINUED EXISTENCE AND 
APPLICATION OF ZEROING METHODOLOGY 
 
 
 
 
Report of the Panel 
 
  
  WT/DS350/R 
 Page i 
 
 
  TABLE OF CONTENTS 
 
Page  
 
I. INTRODUCTION ................................................................................................................... .1 
II. FACTUAL ASPECTS ..............................................................................................................2  
III. PARTIES' REQUESTS FOR FIND INGS AND RECOMMENDATIONS.........................3  
IV. ARGUMENTS OF THE PARTIES ........................................................................................4  
V. ARGUMENTS OF THE THIRD PARTIES ..........................................................................4  
VI. INTERIM REVIEW................................................................................................................. 4 
A. REQUEST OF THE EUROPEAN COMMUNITIES ................................................................................4  
B. REQUEST OF THE UNITED STATES ..............................................................................................10  
VII. FINDINGS....................................................................................................................... ........14  
A. RELEVANT PRINCIPLES REGARDING STANDARD OF REVIEW , TREATY INTERPRETATION 
AND BURDEN OF PROOF .............................................................................................................14  
1. Standard of Review............................................................................................................. ....14  
2. Rules of Treaty Interpretation...............................................................................................15  
3. Burden of Proof................................................................................................................ .......16  
B. THE TERMS "MODEL ZEROING " AND "SIMPLE ZEROING "...........................................................16  
C. TERMS OF REFERENCE ...............................................................................................................16  
1. Measures Not Included in the European Communities' Consultations Request ..............17  
(a) Arguments of the Parties....................................................................................................... ....17  
(i) United States.................................................................................................................. ...........17  
(ii) The European Communities......................................................................................................1 8 
(b) Evaluation by the Panel ........................................................................................................ ....18  
(i) The 14 Additional Anti-Dumping Proceedings.........................................................................18  
(ii) Continued Application of 18 Anti-Dumping Duties..................................................................23  
2. Specificity of the European Comm unities' Reference to 18 Cases .....................................24  
(a) Arguments of the Parties....................................................................................................... ....24  
(i) United States.................................................................................................................. ...........24  
(ii) European Communities........................................................................................................... ..25 
(b) Arguments of Third Parties..................................................................................................... ..25 
(i) Japan.......................................................................................................................... ...............25  
(c) Evaluation by the Panel ........................................................................................................ ....26  
3. Inclusion of Ongoing Proceedings in the European Communities' Panel Request...........34  
(a) Arguments of the Parties....................................................................................................... ....34  
(i) United States.................................................................................................................. ...........34  WT/DS350/R 
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  (ii)
 European Communities........................................................................................................... ..34 
(b) Evaluation by the Panel ........................................................................................................ ....35  
D. CONTINUED APPLICATION OF 18 ANTI -DUMPING DUTIES ..........................................................37  
1. Arguments of the Parties....................................................................................................... .37 
(a) European Communities........................................................................................................... ..37 
(b) United States .................................................................................................................. ...........37  
2. Arguments of Third Parties ...................................................................................................38  
(a) Japan .......................................................................................................................... ...............38  
3. Evaluation by the Panel........................................................................................................ ..38 
E. ZEROING IN INVESTIGATIONS ....................................................................................................38  
1. Arguments of the Parties....................................................................................................... .38 
(a) European Communities........................................................................................................... ..38 
(b) United States .................................................................................................................. ...........39  
2. Arguments of Third Parties ...................................................................................................40  
(a) India .......................................................................................................................... ................40  
(b) Japan .......................................................................................................................... ...............40  
(c) Korea.......................................................................................................................... ...............40  
(d) Norway......................................................................................................................... .............40  
(e) The Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu ...............................41  
(f) Thailand ....................................................................................................................... .............42  
3. Evaluation by the Panel........................................................................................................ ..42 
F. ZEROING IN PERIODIC REVIEWS .................................................................................................45  
1. Arguments of the Parties....................................................................................................... .45 
(a) European Communities........................................................................................................... ..45 
(b) United States .................................................................................................................. ...........47  
2. Arguments of Third Parties ...................................................................................................49  
(a) Brazil......................................................................................................................... ................49  
(b) Japan .......................................................................................................................... ...............49  
(c) Korea.......................................................................................................................... ...............50  
(d) Mexico ......................................................................................................................... .............51  
(e) Norway......................................................................................................................... .............52  
3. Evaluation by the Panel........................................................................................................ ..52 
(a) Relevant Facts................................................................................................................. ..........52  
(i) Steel Concrete Reinforcing Bars From Latvia (Period of Review:  1 September 2002 
– 31 August 2003) .............................................................................................................. .......55   WT/DS350/R 
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  (ii) Stainless Steel Bar From France (Period of Review:  1 March 2004 – 28 February 
2005) .......................................................................................................................... ...............56  
(iii) Stainless Steel Bar From France (Period of Review:  1 March 2003 – 29 February 
2004) .......................................................................................................................... ...............56  
(iv) Stainless Steel Bar From Germany (Period of Review: 1 March 2004 – 28 February 
2005) .......................................................................................................................... ...............56  
(v) Stainless Steel Bar From Germany (Period of Review:  2 August 2001 – 28 February 
2003) .......................................................................................................................... ...............56  
(vi) Stainless Steel Bar From Italy (Period of Review:  2 August 2001 – 28 February 
2003) .......................................................................................................................... ...............57  
(vii) Certain Pasta From Italy (Period of R eview:  1 July 2004 – 30 June 2005)............................57  
(b) Is Simple Zeroing in Periodic  Reviews WTO-Inconsistent? ....................................................57  
(i) Description of the Calculation Methodology Used By the USDOC in Periodic 
Reviews ........................................................................................................................ .............57  
(ii) Legal Analysis................................................................................................................. ..........58  
(iii) The Role of Jurisprudence ...................................................................................................... ..62 
(iv) Conclusion ..................................................................................................................... ...........66  
G. ZEROING IN SUNSET REVIEWS ...................................................................................................66  
1. Arguments of the Parties....................................................................................................... .66 
(a) European Communities........................................................................................................... ..66 
(b) United States .................................................................................................................. ...........67  
2. Arguments of Third Parties ...................................................................................................67  
(a) Japan .......................................................................................................................... ...............67  
(b) Korea.......................................................................................................................... ...............67  
(c) Norway......................................................................................................................... .............67  
3. Evaluation by the Panel........................................................................................................ ..68 
(a) Relevant Facts................................................................................................................. ..........68  
(b) Legal Analysis ................................................................................................................. .........69  
VIII.  CONCLUSIONS AND RECOMMENDATIONS................................................................71  
IX. SEPARATE OPINION BY ONE MEMBER OF THE PANEL WITH REGARD 
TO THE EUROPEAN COMMUNITIES' CLAIMS REGARDING ZEROING IN INVESTIGATIONS AND ZEROIN G IN PERIODIC REVIEWS...............................73
 WT/DS350/R 
Page iv  
 
  LIST OF ANNEXES 
 
ANNEX A 
 
FIRST WRITTEN SUBMISSIONS BY 
THE PARTIES 
 
Contents Page 
Annex A-1 First Written Submission of the European Communities A-2 
Annex A-2 First Written Submission of the United States A-70 
Annex A-3 Response to the United States' Request for Preliminary Rulings by 
the European Communities A-116 
 
 
ANNEX B 
 
THIRD PARTIES' WRITTEN SUBMISSIONS 
 
Contents Page 
Annex B-1 Third Party Written Submission of Japan B-2 
Annex B-2 Third Party Written Submi ssion of the Republic of Korea B-23 
Annex B-3 Third Party Written Submission of Norway B-29 
Annex B-4 Third Party Written Submission of the Separate Customs Territory 
of Taiwan, Penghu, Kinmen and Matsu B-42 
Annex B-5 Third Party Written Submission of Thailand B-48 
 
 
ANNEX C 
 
SECOND WRITTEN SUBMISSIONS BY  
THE PARTIES 
 
Contents Page 
Annex C-1 Second Written Submission of the European Communities C-2 
Annex C-2 Second Written Submission of the United States C-58 
 
 
ANNEX D 
 
ORAL STATEMENTS OF THE PARTIES AND THIRD PARTIES 
AT THE FIRST AND SECOND MEETINGS 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  WT/DS350/R 
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  Contents Page 
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 
 
 
ANNEX E 
 
PARTIES' COMMENTS ON THE APPELLATE BODY REPORT  
IN US – STAINLESS STEEL (MEXICO) (DS344) 
 
Contents Page 
Annex E-1 Comments of the European Communities on the Appellate Body 
Report in US – Stainless Steel (Mexico)  (DS344) E-2 
Annex E-2 Comments of the United Stat es on the Appellate Body Report in 
US – Stainless Steel (Mexico)  (DS344) E-3 
Annex E-3 Comments of the European  Communities on the United States' 
Comments on the Appellate Body Report in US – Stainless Steel 
(Mexico)  (DS344) E-25 
Annex E-4 Comments of the United States on the Comments of the European 
Communities on the Appellate Body Report in US – Stainless Steel 
(Mexico)  (DS344) E-28 
 
 
ANNEX F 
 
REQUEST FOR THE ESTABLISHMENT OF A PANEL 
 
Contents Page 
Annex F-1 Request for the Establishment of a Panel by the 
European Communities F-2 
 WT/DS350/R 
Page vi  
 
  TABLE OF CASES 
 
Short Title Full Case Title and Citation 
Argentina – 
Footwear (EC)  Panel Report, Argentina – Safeguard Measur es on Imports of Footwear 
("Argentina – Footwear (EC) "), WT/DS121/R, adopted 12 January 2000, 
as modified by Appellate Bo dy Report, WT/DS121/AB/R, 
DSR 2000:II, 575 
Brazil – Aircraft  Appellate Body Report, Brazil – Export Financing Programme for 
Aircraft ("Brazil – Aircraft "), WT/DS46/AB/R, adopted 
20 August 1999, DSR 1999:III, 1161 
Brazil – Aircraft  Panel Report, Brazil – Export Financing Programme for Aircraft ("Brazil 
– Aircraft "), WT/DS46/R, adopted 20 A ugust 1999, as modified by 
Appellate Body Report, WT /DS46/AB/R, DSR 1999:III, 1221 
Brazil – Desiccated 
Coconut  Appellate Body Report, Brazil – Measures Affecting Desiccated Coconut 
("Brazil – Desiccated Coconut "), WT/DS22/AB/R, adopted 
20 March 1997, DSR 1997:I, 167 
Canada – Aircraft  Panel Report, Canada – Measures Affecti ng the Export of Civilian 
Aircraft ("Canada – Aircraft "), WT/DS70/R, a dopted 20 August 1999, 
upheld by Appellate Body Repo rt, WT/DS70/AB/R, DSR 1999:IV, 1443 
Canada – Aircraft  Appellate Body Report, Canada – Measures Affecting the Export of 
Civilian Aircraft ("Canada – Aircraft") , WT/DS70/AB/R, adopted 
20 August 1999, DSR 1999:III, 1377 
Canada – Wheat Exports 
and Grain Imports  Panel Report, Canada – Measures Relating to Exports of Wheat and 
Treatment of Imported Grain ("Canada – Wheat Exports and Grain 
Imports "), WT/DS276/R, adopted 27  September 2004, upheld by 
Appellate Body Report, WT /DS276/AB/R, DSR 2004:VI, 2817 
EC – Bananas III 
(Ecuador)  Panel Report, European Communities – Regime for the Importation, Sale 
and Distribution of Bananas, Complaint by Ecuador ("EC – Bananas III 
(Ecuador) "), WT/DS27/R/ECU, adopted 25 September 1997, as 
modified by Appellate B ody Report, WT/DS27/AB/R, 
DSR 1997:III, 1085 
EC – Computer Equipment  Appellate Body Report, European Communities – Customs Classification 
of Certain Computer Equipment ("EC – Computer Equipment "), 
WT/DS62/AB/R, WT/DS67/AB/R , WT/DS68/AB/R, adopted 
22 June 1998, DSR 1998:V, 1851 
Japan – Agricultural Products II  Panel Report, Japan – Measures Affecting Agricultural Products ("Japan 
– Agricultural Products II "), WT/DS76/R, adopted 19 March 1999, as 
modified by Appellat e Body Report, WT/DS76/AB/R, DSR 1999:I, 315 
Japan – Alcoholic 
Beverages II  Appellate Body Report, Japan – Taxes on Alcoholic Beverages ("Japan – 
Alcoholic Beverages II "), WT/DS8/AB/R, WT/DS10/AB/R, 
WT/DS11/AB/R, adopted 1 November 1996 
Japan – DRAMs (Korea)  Panel Report, Japan – Countervailing Duties on Dynamic Random 
Access Memories from Korea  ("Japan – DRAMs (Korea) "), 
WT/DS336/R, a dopted 17 December 2007, as modified by Appellate 
Body Report, WT/DS336/AB/R  WT/DS350/R 
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  Short Title Full Case Title and Citation 
Japan – Film  Panel Report, Japan – Measures Affecting Consumer Photographic Film 
and Paper  ("Japan – Film "), WT/DS44/R, adopted 22 April 1998, 
DSR 1998:IV, 1179 
Korea – Dairy Appellate Body Report, Korea – Definitive Safeguard Measure on 
Imports of Certain Dairy Products ("Korea – Dairy "), WT/DS98/AB/R, 
adopted 12 January 2000, DSR 2000:I, 3 
Mexico – Anti-Dumping Measures on Rice  Panel Report, Mexico – Definitive Anti-Dumping Measures on Beef and 
Rice, Complaint with Respect to Rice ("Mexico – Anti-Dumping 
Measures on Rice "), WT/DS295/R, adopted 20 December 2005, as 
modified by Appellate Body Report, WT/DS295/AB/R, DSR 
2005:XXIII, 11007 
Mexico – Corn Syrup  Panel Report, Mexico – Anti-Dumping Investigation of High Fructose 
Corn Syrup (HFCS) from the United States ("Mexico – Corn Syrup "), 
WT/DS132/R and Corr.1, a dopted 24 February 2000, 
DSR 2000:III, 1345 
US – Carbon Steel  Appellate Body Report, United States – Countervailing Duties on 
Certain Corrosion-Resistant Carbon St eel Flat Products from Germany 
("US – Carbon Steel "), WT/DS213/AB/R and Corr.1, adopted 
19 December 2002, DSR 2002:IX, 3779 
US – Certain EC Products  Appellate Body Report, United States – Import Measures on Certain 
Products from the European Communities ("US – Certain EC 
Products "), WT/DS165/AB/R, a dopted 10 January 2001, 
DSR 2001:I, 373 
US – Corrosion-Resistant Steel Sunset Review  Appellate Body Report, United States – Sunset Review of Anti-Dumping 
Duties on Corrosion-Resistant Carbon Steel Flat Products from Japan  
("US – Corrosion-Resistant Steel Sunset Review "), WT/DS244/AB/R, 
adopted 9 January 2004, DSR 2004:I, 3 
US – Hot-Rolled Steel  Appellate Body Report, United States – Anti-Dumping Measures on 
Certain Hot-Rolled St eel Products from Japan ("US – Hot-Rolled Steel "), 
WT/DS184/AB/R, adopted 23 August 2001, DSR 2001:X, 4697 
US – Oil Country Tubular Goods Sunset Reviews  Appellate Body Report, United States – Sunset Reviews of Anti-Dumping 
Measures on Oil Country T ubular Goods from Argentina  ("US – Oil 
Country Tubular Goods Sunset Reviews "), WT/DS268/AB/R, adopted 
17 December 2004, DSR 2004:VII, 3257 
US – Shrimp (Article 21.5 – Malaysia)  Appellate Body Report, United States – Import Prohibition of Certain 
Shrimp and Shrimp Products – Recourse to Article 21.5 of the DSU by 
Malaysia  ("US – Shrimp (Article 21.5 – Malaysia) "), WT/DS58/AB/RW, 
adopted 21 November 2001 
US – Shrimp (Ecuador)  Panel Report, United States – Anti-Dumping Measures on Shrimp from 
Ecuador ("US – Shrimp (Ecuador) "), WT/DS335/R, adopted 
20 February 2007 
US – Softwood Lumber V  Appellate Body Report, United States – Final Dumping Determination 
on Softwood Lumber from Canada ("US – Softwood Lumber V "), 
WT/DS264/AB/R, adopted 31 August 2004, DSR 2004:V, 1875 WT/DS350/R 
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  Short Title Full Case Title and Citation 
US – Stainless Steel 
(Mexico)  Appellate Body Report, United States – Final Anti-Dumping Measures 
on Stainless Steel from Mexico  ("US – Stainless Steel (Mexico) "), 
WT/DS344/AB/R, adopted 20 May 2008 
US –Stainless Steel (Mexico)  Panel Report, United States – Final Anti-Dumping Measures on 
Stainless Steel from Mexico ("US –Stainless Steel (Mexico) "), 
WT/DS344/R, adopted 20 May 2008, as modified by Appellate Body Report, WT/DS344/AB/R 
US – Steel Plate  Panel Report, United States – Anti-Dumping and Countervailing 
Measures on Steel Plate from India ("US – Steel Plate "), WT/DS206/R 
and Corr.1, adopted 29 July 2002, DSR 2002:VI, 2073 
US – Wool Shirts and Blouses  Appellate Body Report, United States – Measure Affecting Imports of 
Woven Wool Shirts and Blouses from India ("US – Wool Shirts and 
Blouses "), WT/DS33/AB/R and Corr.1, adopted 23 May 1997, 
DSR 1997:I, 323 
US – Zeroing (Japan) Appellate Body Report, United States – Measures Relating to Zeroing 
and Sunset Reviews  ("US – Zeroing (Japan) "), WT/DS322/AB/R, 
adopted 23 January 2007 
     WT/DS350/R 
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  I. INTRODUCTION 
1.1 On 2 October 2006, the European Comm unities ("EC") requested consultations1 with the 
United States of America ("United States" or "US" ) pursuant to Article 4 of the Understanding on 
Rules and Procedures Governing the Settlement of Di sputes ("DSU");  Article XXII:1 of the General 
Agreement on Tariffs and Trade 1994 ("GATT 1994");  and Articles 17.2 and 17.3 of the Agreement 
on Implementation of Article VI of the Gene ral Agreement on Tariffs and Trade 1994 ("Anti-
Dumping Agreement" or "Agreement") with rega rd to the practice and methodologies for calculating 
dumping margins involving the use of zeroing, and th e application of zeroing in certain specified anti-
dumping measures.  In its request for further consultations2, dated 9 October 2006, the European 
Communities added two measures to its initial request.   
1.2 On 10 May 2007, the European Commun ities requested the Dispute Settlement 
Body ("DSB") to establish a panel pursuant to Article s 2.1 and 6.1 of the DSU;  Article XXII:2 of the 
GATT 1994;  and Articles 17.4 and 17.5 of the Anti-Du mping Agreement "with regard to an 'as such' 
measure or measures providing for the practic e or methodologies for calculating dumping margins 
involving the use of zeroing, and the applica tion of zeroing in certain specified anti-dumping 
measures maintained by the United States...".3 
1.3 At its meeting on 4 June 2007, the DSB established a panel pursuant to the request of the 
European Communities in document WT/DS350/6, in  accordance with Article 6 of the DSU.   
1.4 The Panel's terms of reference are the following:   
"To examine, in the light of the relevant provisions of the covered agreements cited 
by the European Communities in document WT/DS350/6, the matter referred to 
the DSB by the European Communities in that  document, and to make such findings 
as will assist the DSB in making the recommendations or in giving the rulings provided for in those agreements." 
1.5 On 29 June 2007, the European Communities requ ested the Director-General to determine the 
composition of the Panel, pursuant to paragraph 7 of Ar ticle 8 of the DSU.  This paragraph provides:   
"If there is no agreement on the panelists within 20 days after the date of the 
establishment of a panel, at the request of  either party, the Director-General, in 
consultation with the Chairman of the DSB and the Chairman of the relevant Council 
or Committee, shall determine the com position of the panel by appointing the 
panelists whom the Director-General consid ers most appropriate in accordance with 
any relevant special or additional rules or  procedures of the covered agreement or 
covered agreements which are at issue in th e dispute, after consulting with the parties 
to the dispute.  The Chairman of th e DSB shall inform the Members of the 
composition of the panel thus formed no later than 10 days after the date the 
Chairman receives such a request."   
1.6 On 6 July 2007, the Director-General acco rdingly composed the Panel as follows:   
Chairperson: Dr. Faizullah Khilji 
  
                                                     
 
1 WT/DS350/1.   
2 WT/DS350/1/Add.1.   
3 WT/DS350/6.   WT/DS350/R 
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   Members: Mr. Michael Mulgrew 
   Ms Lilia R. Bautista  1.7 Brazil, China, Egypt, India, Japan, Korea, Mexico, Norway, Chinese Taipei and Thailand 
reserved their rights to participate in the panel proceedings as third parties.   
1.8 Following the resignation on 8 November 2007 of Ms Lilia R. Bautista, the parties, on 
27 November 2007, appointed a new Panel Member.  A ccordingly, the composition of the Panel is as 
follows:   
Chairperson: Dr. Faizullah Khilji 
 
 Members: Mr. Michael Mulgrew 
   Ms Andrea Marie Brown  1.9 The Panel met with the parties on 29-30 January  2008 and on 22 April 2008.  The meetings 
with the parties were opened to public viewing.   The Panel met with the third parties on 
30 January 2008.  A portion of the Panel's meeting with the third parties was also opened to public 
viewing. 
1.10 Following the second meeting with the parties, and pursuant to a request from the 
United States made on 2 May 2008, to which the European Communities did not object, the Panel 
provided the parties with the opportunity to make  comments on the relevance of the Appellate Body 
report in US – Stainless Steel (Mexico)  to this dispute as well as to comment on each other's 
comments. 
II. FACTUAL ASPECTS 
2.1 This dispute involves the EC's claims re garding the continued application by the 
United States of anti-dumping duties resulting fr om the anti-dumping orders enumerated in 18 cases
4, 
as calculated or maintained in place at a level in excess of the margin of dumping that in the EC's 
view would have resulted from the correct applica tion of the relevant provisions of the Anti-Dumping 
Agreement.  The European Commun ities also challenges the specific instances of application of what 
it describes as the "zeroing methodology" in 4 anti-dumping investigations, 37 periodic reviews and 
                                                      
4 The EC's panel request describes this measure as "[t]he continued application of, or the application of 
the specific anti-dumping duties resulting from the anti-du mping orders enumerated from I to XVIII in the 
Annex to the present request..."  In its submissions to  the Panel, the European Communities uses slightly 
different descriptions to refer to the measure at issue.   Although it generally refers to this measure as "the 
application or continued application" of the 18 anti-dumping duties at issue, in some instances it only uses the 
term "continued application".  In response to questioning, the European Communities stated that "the use of this slightly different phrasing is for ease of reference and ease of understanding only, and has no incidence on the 
legal assessment to be conducted by the Panel".  Respon se of the European Communities to Question 1(b) from 
the Panel Following the First Meeting.  For ease of reference, in our report, we also refer to this measure as "the 
continued application" of the 18 duties at issue.  The United States acknowledges that  for ease of reference the 
Panel may choose to use the term "continued applica tion" as a shortcut for "continued application or 
application".  Regarding the second component of the term that the Panel prefers to use, however, the 
United States notes that the European Communities challenges "the continued application or application of anti-
dumping duties in 18 cases ", not "the continued application or application of 18 anti-dumping duties ", and 
requests the Panel to use a description that conveys this difference.  Put differently, the United States emphasises the difference between the continued application of duties per se  and the continued application of 
duties arising from different anti-dumping cases.  Request by the United States for the Review of Precise 
Aspects of the Interim Report of the Panel, paras. 3- 6.  We would like to reiterate that the abbreviated 
description that we use to refer to the measure at issu e is for ease of reference only and by no means prejudges 
our legal reasoning ( supra , paras. 7.40-7.67) regarding the WTO-compatibility of such measure.  WT/DS350/R 
 Page 3 
 
 
  11 sunset reviews pertaining to the same 18 cases.  The 18 cases and the 52 proceedings pertaining to 
such cases are listed in the annex to the EC's panel request.  The European Communities does not 
challenge the zeroing methodology "as such" in this dispute.5 
2.2 Zeroing, according to the European Communities, is a methodology that fails to take into 
consideration the totality of export transactions in the calculation of margins of dumping for the 
product under consideration as a whole.  Specifically , the European Communitie s takes issue with the 
use of zeroing in investigations where the normal value and the export price are compared on a weighted average-to-weighted average ("WA-WA") basis (referred to by the European Communities 
as "model zeroing")
6, periodic reviews where margins are calculated on the basis of a weighted 
average normal value and individual export transac tions ("WA-T") (referred to by the European 
Communities as "simple zeroing")7, and sunset reviews where the investigating authorities rely on 
previous margins obtained through either model or simple zeroing. 
III. PARTIES' REQUESTS FOR FINDINGS AND RECOMMENDATIONS 
3.1 The European Communities request s the Panel to find that: 
"(a)  The United States failed to comply with Articles 2.4, 2.4.2, 9.3, 11.1, 11.3 of the 
Anti-Dumping Agreement, Articles VI:1 and VI:2 of the GATT 1994, and 
Article XVI:4 of the WTO Agreement sin ce it continues applying duties which were 
calculated by using zeroing in the 18 anti-dumping measures mentioned in the Annex to the EC's Panel request.   
(b)  The United States violated Articles 2.4 and 2.4.2 of the Anti-Dumping Agreement as 
well as Articles VI:1 and VI:2 of the GATT 1994 when applying model zeroing in 
the 4 original investigation proceedings me ntioned in the Annex to the EC's Panel 
request.   
(c)  The United States violated Articles 2.4, 2.4.2, 9.3 and 11.2 of the Anti-Dumping 
Agreement as well as Articles VI:1 and VI:2 of the GATT when using zeroing in the 37 administrative review proceedings incl uded in the Annex to the EC's Panel 
request.   
(d)  The United States violated Articles 2.1, 2.4, 2.4.2, 11.1 and 11.3 of the Anti-Dumping 
Agreement in the sunset review proceedi ngs mentioned in the Annex to the EC's 
Panel request when relying on margins of dumping calculated in prior investigations 
using the zeroing methodology."
8 
3.2 The European Communities also requests the Pa nel to suggest, pursuant to Article 19 of 
the DSU, that the United States cease using zeroi ng when calculating dumping margins in any anti-
dumping proceeding in connection with the 18 cases identif ied in the annex to the EC's panel request.   
3.3 The United States asks the Panel to reject the EC's "as applied" claims regarding periodic 
reviews, sunset reviews, and investigations9 and find that the United States has not acted 
                                                      
5 First Written Submission of the European Communities, para. 2.   
6 See para. 7.7 below for an explanation of the term "model zeroing". 
7 See paras. 7.159-7.160 below for an explanation of the term "simple zeroing". 
8 First Written Submission of the European Communities, para. 264. 
9 The United States, in these proceedings, does not contest the alleged inconsistency with Article 2.4.2 
of the Agreement of zeroing in investigations where the weighted aver age normal value is compared with the 
weighted average export price.  It , however, disagrees with the claims developed by the European Communities 
under other provisions of the Agreement and Article VI of the GATT 1994 regarding such zeroing.  Thus, the WT/DS350/R 
Page 4  
 
  inconsistently with the Anti-Dumping Agreement a nd the GATT 1994.  The United States also raises 
three preliminary objections regarding the Panel’s terms of reference.
10  First, the United States asks 
the Panel to find that 14 of the 52 anti-dumping dete rminations, and the contin ued application of the 
18 anti-dumping duties at issue are outside the Panel’s terms of reference because they were not included in the EC's consultations request.  Second,  the United States requests that the Panel find that 
the EC's reference in its panel request to the c ontinued application of the 18 anti-dumping duties does 
not meet the specificity requirement of Article 6.2 of the DSU.  Third, the United States asks the Panel to find that four preliminary measures identif ied in the EC's panel request are not within the 
Panel's terms of reference because the identification of the mentioned measures did not meet the conditions laid down in Artic le 17.4 of the Agreement. 
IV. ARGUMENTS OF THE PARTIES 
4.1 The arguments of the parties are set out in their written submissions and oral statements to the 
Panel and their answers to questions.  The parties' s ubmissions and oral statements are attached to this 
report as annexes (see List of Annexes, pages iv and v).   
V. ARGUMENTS OF THE THIRD PARTIES 
5.1 Brazil, China, Egypt, India, Japan, Korea, Mexico, Norway, Chinese Taipei and Thailand 
reserved their rights to participate in the Panel pro ceedings as third parties.  Brazil, China, Egypt, 
India and Mexico did not present written submission s and China, Egypt and Thailand did not submit 
oral statements to the Panel.  The arguments of Japan, Korea, Norway and Chinese Taipei are set out 
in their written submissions and oral statements, the arguments of Brazil, India and Mexico are set out 
in their oral statements, while Thailand's arguments are set out in its written submission to the Panel.  
The third parties' written submissions and oral stat ements are attached to this report as annexes (see 
List of Annexes, pages iv and v). 
VI. INTERIM REVIEW 
6.1 On 27 June 2008, we submitted our  interim report to the parties.  On 11 July 2008, both 
parties submitted written requests for the review of  precise aspects of the interim report.  On 
25 July 2008, both parties submitted their comments on the other party's request for review.  None of 
the parties requested an interim review meeting. 
6.2 We set out our treatment of the parties' request s below.  In addition to the changes explained 
in the following paragraphs, we have, where necessa ry, made technical revisions to our report and 
corrected typographical and other minor errors found in the interim report. 
A. 
REQUEST OF THE EUROPEAN COMMUNITIES  
6.3 First, the European Communities requests the Panel to reconsider its assessment of the 
evidence submitted by the European Communities rega rding the seven periodic reviews discussed in 
paragraphs 7.151-7.157 below and to find that the European Communities has shown prima facie that 
the USDOC used the simple zeroing methodology in  the mentioned reviews.  The United States 
argues that the European Communities should not be provided an opportunity to make a prima facie 
case at this late stage of the proceedings.  The Unite d States submits that the interim review stage is 
                                                                                                                                                                     
US request that the Panel dismiss the EC's "as applied" claims regarding zeroing in investigations where the 
weighted average normal value is compar ed with the weighted average export price pertains to claims other than 
the one under Article 2.4.2.  See, Response of the Un ited States to Question 15 from the Panel following the 
First Meeting.   
10 First Written Submission of the United States, paras. 42-46.  WT/DS350/R 
 Page 5 
 
 
  only for parties to make comments on precise aspects of the Panel's interim report, not for a party to 
make a prima facie  case that it failed to make until that point  in time.  The United States recalls the 
opportunities that the Panel provided for the European  Communities to explain the factual bases of its 
assertions regarding the seven reviews at issue.  Since the European Communities failed to take 
advantage of those opportunities to demonstrate the factual bases of its claims regarding the seven 
reviews at issue, it should not be given another chance to do that at the interim review stage. 
6.4 Although we understand the US con cern regarding the relative lateness in the EC's attempt to 
explain the factual bases of its claims regarding the seven periodic reviews at issue, we see no 
provision in the DSU that would preclude us fro m assessing the EC's explanations.  Nor has the 
United States cited such a legal provision in its argum entation in this regard.  We therefore proceed to 
our assessment of the EC's comments. 
6.5 The European Communities first makes gene ral comments concerning all seven periodic 
reviews, followed by comments specifically addressi ng evidence submitted in connection with five of 
the seven reviews at issue. 
6.6 The European Communities commences its general comments by recalling the USDOC 
notice published on 27 December 2006, which reads in relevant parts: 
"In its March 6, 2006 Federal Register  notice, the Department proposed only that it 
would no longer make average-to-average comparisons in investigations without 
providing offsets for non-dumped comparisons . The Department made no proposals 
with respect to any other comparison methodology or any other segment of an antidumping proceeding, and thus declin es to adopt any such modifications 
concerning those other methodologies in this proceeding."
11  (emphasis in original) 
6.7 According to the European Communities, this  part of the USDOC's notice means that: 
"[T]he USDOC expressly stated that it was not modifying  any aspect of its 
comparison methodologies for calculating dum ping, other than the abandonment of 
zeroing when making average-to-average co mparisons in original investigations. 
Thus, since the results of all the administrative reviews covered by this dispute were 
published before the date of the publication of the USDOC Notice ( i.e., 
27 December 2006), it should be concluded that the European Communities has made 
a prima facie  case that the United States actually ap plied simple zeroing also in those 
seven administrative reviews. "12  (footnote omitted, italic emphasis in original, 
underline emphasis added) 
6.8 In the view of the European Communities, this Federal Register notice creates a presumption 
that simple zeroing was used in the seven reviews at issue becau se they were conducted before the 
issuance of the notice.13  In this regard, the European Communities also notes our reasoning in 
paragraph 7.200 below as to whether the same no tice showed that the USDOC had used model 
zeroing in the four investigations at issue in th ese proceedings.  The United States responds that such 
a broad statement cannot be evidence of the fact th at zeroing was used in each of the seven periodic 
reviews at issue.  "To the cont rary, because each assess ment review involves a distinct product, 
                                                      
11 Exhibit EC-90, p. 77724. 
12 Request by the European Communities for the Review of Precise Aspects of the Interim Report of 
the Panel, p. 2. 
13 Request by the European Communities for the Review of Precise Aspects of the Interim Report of 
the Panel, p. 6. WT/DS350/R 
Page 6  
 
  country, period of time, and sales data, the [Europ ean Communities] must demonstrate that zeroing 
occurred in each of the individual administrative reviews challenged."
14 
6.9 We note that the context in which we ac cepted the inference made by the European 
Communities in paragraph 7.200 below is remarkably  different from the context in connection with 
the EC's claims regarding the alleged use of simple  zeroing in the seven periodic reviews at issue.  
The part of the USDOC's notice quoted in paragraph 7.200 makes a specific reference to 
investigations where a particular comparison met hodology is used and states that the USDOC will no 
longer use that methodology without taking into c onsideration the results of all comparisons.  
Logically, this means that until the date of the po licy change, the methodology at issue was used by 
the USDOC without considering the results of all comparisons.  Because the particular comparison 
methodology described there, WA-WA, was the me thodology in which what we call "model zeroing" 
was routinely used in investigations, and the inves tigations at issue were completed before the policy 
change, we concluded that the European Communities had showed prima facie  that the USDOC used 
model zeroing in investigations completed before this policy change.  By contrast, the USDOC's 
policy change makes no specific reference to pe riodic reviews and the methodologies that may be 
used in such reviews.  It simply mentions that  the USDOC is not changing the methodologies it uses 
in investigations where methodologies other than  WA-WA are used, and in other anti-dumping 
proceedings.  As such, we find this statement to be too broad to support the EC's argument that the USDOC used simple zeroing in all periodic reviews ca rried out before the effective date of the policy 
change at issue.  We therefore reject the EC's contention in this regard. 
6.10 The European Communities argues that the f act that the USDOC's Issues and Decision 
Memoranda pertaining to the seven periodic reviews at issue do not mention the methodology used is 
not determinative of whether simple zeroing was used  in such reviews.  We agree with the European 
Communities.  Nowhere in our report do we impl y that such memoranda constitute the only way 
through which the European Communities could de monstrate that the USDOC used the simple 
zeroing methodology in the seven reviews at issue.  In paragraphs 7.151-7.157 below, we only note 
that the USDOC's Issues and Decision Memoranda pe rtaining to the mentioned reviews do not shed 
light on the methodology used.   
6.11 The European Communities also asserts that give n the several years of WTO litigation against 
the United States regarding the zeroing methodology, it should not be disputed that simple zeroing was used in the seven periodic re views at issue.  The United St ates responds that prior dispute 
settlement reports are only binding with regard to th e resolution of the disputes they concern and that 
the US response or reaction to such reports is irrelevant for purposes of these proceedings.  We 
disagree with the EC's contention.  We do not consid er that the existence of past disputes against the 
United States regarding zeroing discharges the Eur opean Communities' burden of proving in this 
dispute that the simple zeroing methodology was us ed in specific periodic reviews challenged.  We 
consider that whether the United States complied with the DSB recommendations  and rulings in past 
disputes is irrelevant to our task in these proceed ings, since every dispute stands on its own merits.  
This is so, even if, as the Europ ean Communities argues, such past disputes concern the same measure 
that is at issue in these proceedings. 
6.12 The EC's general comments are followed by sp ecific comments regarding five of the seven 
periodic reviews at issue.  These reviews are: Steel Concrete Reinforcing Bars From Latvia (Period of 
Review:  
1 September 2002 – 31 August 2003 ), Stainless Steel Bar From Germany (Period of Review: 1 
March 2004 – 28 February 2005) , Stainless Steel Bar From Germany (Period of Review:  2 August 
2001 – 28 February 2003) , Stainless Steel Bar From Italy (Period of Review:  2 August 2001 – 28 
February 2003)  and Certain Pasta From Italy (Period of Review:  1 July 2004 – 30 June 2005) . 
                                                      
14 Comments of the United States on the Request by the European Communities for the Review of 
Precise Aspects of the Interim Report of the Panel, para. 6.  WT/DS350/R 
 Page 7 
 
 
  6.13 Regarding the periodic review in Steel Concrete Reinforcing Bars From Latvia (Period of 
Review:  1 September 2002 – 31 August 2003) , the European Communities asserts that the calculation 
tables submitted in Exhibit EC-35 show that zeroi ng was used because the percentage of value with 
anti-dumping margins and the percentage of quan tity with anti-dumping margins used was not 
100 per cent.  This means that "for the remaini ng transactions, no 'dumping' was found and no 'offsets' 
were provided."15  The European Communities also argues th at the standard programme used by the 
USDOC in the review at issue contained the zeroing line which excluded the comparisons with 
negative results.  According to the European Comm unities, when read together, the tables and the 
standard programme show that simple zeroing was used in the periodic review at issue. 
6.14 Regarding the periodic reviews in Stainless Steel Bar From Germany (Period of Review: 
1 March 2004 – 28 February 2005)  and Stainless Steel Bar From Germany (Period of Review: 
2 August 2001 – 28 February 2003) , the European Communities refe rs to the calculation tables 
submitted in Exhibits EC-57 and EC-58 and argues that  such tables show that zeroing was used in the 
two reviews at issue.  The European Communities also  draws attention to the f act that the columns in 
the mentioned two tables, which s how calculations with zeroing, correspond to the margins calculated 
by the USDOC and hence the figures in such co lumns are accurate.  Th e European Communities 
contends that the standard computer programme used by the USDOC in these reviews contained the 
zeroing line which would eliminate comparisons with negative results. 
6.15 Regarding the periodic review in Stainless Steel Bar From Italy (Period of Review:  
2 August 2001 – 28 February 2003) , the European Communities submits that the calculation table 
submitted in Exhibit EC-62 shows that the percen tage of value with anti-dumping margins and the 
percentage of quantity with anti-dumping margins used  was not 100 per cent.  This means that zeroing 
was used in this review because "for the re maining transactions, no 'dumping' was found and no 
'offsets' were provided."16  The European Communities also argu es that the standard programme used 
by the USDOC in the review at issue contained the zeroing line which excluded the comparisons with 
negative results.  According to the European Comm unities, when read together, the table and the 
standard programme show that simple zeroing was used in the periodic review at issue. 
6.16 Regarding the periodic review in Certain Pasta From Italy (Period of Review:  1 July 2004 – 
30 June 2005) , the European Communities submits that th e calculation table submitted in Exhibit EC-
65 shows that the percentage of value with anti-dum ping margins and the percentage of quantity with 
anti-dumping margins used was not 100 per cent.  Th is means that zeroing was used in this review 
because "for the remaining transactions, no 'dum ping' was found and no 'offsets' were provided."17  
The European Communities also ar gues that the standard programme used by the USDOC in the 
review at issue contained the zeroing line which excluded the comparisons with negative results.  
According to the European Communities, when read  together, the table and the standard programme 
show that simple zeroing was used in the periodic review at issue. 
6.17 The United States objects to the EC's arguments.  The US comments in this regard apply to all 
five periodic reviews with respect to which the European Communities asks the Panel to change its 
findings.  The United States submits that because the calculation tables submitted by the European 
Communities in connection with the five reviews at issue were not generated by the USDOC, the 
United States is not in a position to confirm their accuracy.  Such tables, therefore, do not show that zeroing was applied in the periodic reviews at issue.   The United States also asserts that there is no 
                                                     
 
15 Request by the European Communities for the Review of Precise Aspects of the Interim Report of 
the Panel, pp. 2-3. 
16 Request by the European Communities for the Review of Precise Aspects of the Interim Report of 
the Panel, p. 5. 
17 Request by the European Communities for the Review of Precise Aspects of the Interim Report of 
the Panel, p. 6. WT/DS350/R 
Page 8  
 
  such thing as a "standard computer programme" that  the USDOC uses in every periodic review, nor is 
there a programme that requires zeroing.  The United St ates, therefore, invites the Panel to reject the 
EC's request with regard to the five periodic reviews at issue. 
6.18 Having carefully considered the EC's comments regarding the five periodic reviews addressed 
in the preceding paragraphs, we do not see any reas on to change our conclusion that the European 
Communities failed to show prima facie  that the USDOC used simple zeroing in such reviews.  We 
have, however, modified paragra ph 7.151 and paragraphs 7.154 thr ough 7.157 of our report in order 
to reflect certain concerns mentioned in the EC 's comments and to set out our reasoning in more 
detail. 
6.19 The European Communities asserts that there ar e no other documents av ailable regarding the 
five periodic reviews at issue and therefore it is for the United States to rebut the prima facie  case 
made by the European Communities.  The European  Communities contends that the United States has 
failed to unconditionally accept the prior adopted Appellate Body reports regarding zeroing and 
asserts that the United States should not be allowe d to evade its international obligations by 
withholding information from the exporters, th e European Communities and the Panel in these 
proceedings.  The United States objects, arguing that it has not contested documents that it was able to 
authenticate in these proceedings and that it can not confirm the accuracy of other documents 
contained in the EC's exhibits.  The United Stat es recalls that the European Communities has the 
burden of making a prima facie  case to the effect that the USDO C used simple zeroing in the five 
periodic reviews at issue. 
6.20 We recall that according to the principles c oncerning burden of proof  applicable in WTO 
dispute settlement,
18 it is for each party to submit evidence of factual assertions that it makes.  In order 
to make out a prima facie  case that the USDOC acted incons istently with the Anti-Dumping 
Agreement by using simple zeroing in the five peri odic reviews at issue, therefore, the European 
Communities must submit evidence of the underlying  factual assertion.  The European Communities 
has met that burden with regard to 29 of the 37 periodic reviews which are within our terms of 
reference in these proceedings.  It has not, however, done so with rega rd to the five reviews that the 
European Communities addresses in its request for re view of the interim report.  The European 
Communities having failed in this regard, there is nothing for the United States to rebut - we cannot 
expect the United States to rebut a prima facie  case that has not been made by the European 
Communities.  With regard to the EC's assertion th at the United States withholds information from the 
exporters, the European Communities and the Panel, we  recall that pursuant to Article 13 of the DSU, 
the Panel has the right to seek information from any individual or body it deems appropriate, 
including the parties to a dispute.19  If the European Communities believed that the United States was 
withholding necessary information, it could have ask ed the Panel to seek such information from the 
United States.  It did not do so.20  We make no representations as to whether such a request would 
                                                      
18 See infra , para. 7.6. 
19 Considering Article 13.1 of the DSU, and other provisions, the Appellate Body concluded in Canada 
– Aircraft that "a panel has broad legal authority to request information from a Member that is a party to a 
dispute, and ... a party so requested has a legal duty to provide such information."  Appellate Body Report, 
Canada – Measures Affecting the Export of Civilian Aircraft ("Canada – Aircraft") , WT/DS70/AB/R, adopted 
20 August 1999, DSR 1999:III, 1377, para. 197. 
20 In its response to a question from the Panel fo llowing the Second Meeting with the Parties, the 
European Communities stated that "in case the Panel would consider it necessary to obtain the detailed margin 
calculations for each of the cases covered by these seve n exhibits, it should reques t copy of these detailed 
calculations from the [United States]."  Response of th e European Communities to Question 1(c) From the Panel 
Following the Second Meeting.  Such a general statemen t clearly does not suffice as a request to the Panel to 
seek specific factual inform ation from the USDOC pursuant to its authority under Article 13.  Moreover, we 
consider that it would be inappropriate for a panel to exercise its authority to seek information based on its own  WT/DS350/R 
 Page 9 
 
 
  have been granted had it been made in a timely fashi on. What is clear is that  in the absence of such a 
request, there is in our view no basis upon which to conclude that the United States improperly 
withheld information, thereby preventing the European Communities from making out its prima facie  
case.  Thus, we can see no reason why the United St ates should be expected to rebut a factual 
assertion unsupported by relevant evidence from the party making the assertion.   In effect, this would 
be much the same as drawing an adverse inference against the Untied States in this regard.  While a 
panel has the authority to draw such inferences  where information it requested is not provided,21 such 
an inference should not be drawn by a panel light ly, and only where the circumstances warrant, which 
they do not in this case. 
6.21 The European Communities contends that should th e Panel reject the EC's request with regard 
to the above-mentioned five periodic reviews, the Pane l should refer to 30 periodic reviews, not 29, in 
paragraphs 7.183 and 8.2(b) below.  The United States objects, arguing that the European Communities fails to exclude from 37 the one review  which the Panel excluded from the scope of its 
terms of reference on the grounds that the Eu ropean Communities challenged a preliminary 
determination in connection with the mentione d review.  As the United States argues, and as 
explained in paragraph 7.158 below, we have found that the periodic review in Certain Hot Rolled 
Carbon Steel Flat Products from the Netherlands
 (Period of Review:  1 November 2004 – 
31 October 2005)  is not within the scope of our terms of reference on the grounds that the review at 
issue involved a preliminary determination made by the USDOC.  Together with our other conclusions concerning reviews not properly before  us, it therefore follows that our conclusions 
regarding the use of simple zeroing in periodic re views only apply to 29 of the 37 periodic reviews 
challenged by the European Co mmunities in these proceedings. 
6.22 Second, the European Communities requests th e Panel to change the second sentence in 
paragraph 7.179 to "Such an objective assessment, including the standard of review pursuant to 
Article 17.6(ii) of the Anti-Dumping Agreement,  does not, of course, occur in a vacuum".  According 
to the European Communities, this would reconcile different statements found in our report regarding 
permissible interpretations of a treaty provision.  The United States disagrees with the EC's request.  
The United States argues that paragraph 7.179 addr esses the Panel's duty to carry out an objective 
assessment pursuant to Article 11 of the DSU an d that the additional phrase requested by the 
European Communities concerns the standard of review.  While acknowledging that Article 17.6(ii) 
of the Anti-Dumping Agreement supplements Article 11 of the DSU, the United States contends that 
it would be incorrect to state that the "objectiv e assessment" obligation in cludes the standard of 
review under Article 17.6(ii).  We see no legal ba sis for the change proposed by the European 
Communities.  Nor would such a modification serve to clarify our reasoning.  We therefore decline to modify our finding in this regard. 
6.23 Third, the European Communities invites the Pane l to reconsider its finding in paragraph 8.7 
below not to make a suggestion as to how the Unite d States has to bring its measures into compliance 
with its WTO obligations.  The European Communities argues that making suggestions as provided 
for under the second sentence of Article 19.1 of the DS U would contribute to the prompt resolution of 
this dispute.  The European Communities also draw s attention to the fact that the United States has 
failed to implement DSB recommendations and rulings  in the past disputes where the use of the 
zeroing methodology in various contexts was condemned.  The United States submits that the authority given to panels under Article 19.1 of th e DSU should not be lightly exercised by panels.  
The United States reiterates its argument that th e DSU does not allow a suggestion of the kind 
requested by the European Communities, i.e., one that would clarify the scope of a potential 
compliance panel that may or may not be established in  the future for the resolution of this dispute. 
                                                                                                                                                                    
 
judgement as to what information is n ecessary for a party to prove its case, as opposed to seeking information in 
order to elucidate its understanding of the facts and issues in the dispute before it.   
21 Appellate Body Report, Canada – Aircraft , supra , note 19, para. 203. WT/DS350/R 
Page 10  
 
  6.24 Having analyzed the arguments presented in the EC's comments on our interim report, we 
consider that it fully and clearly expresses our vi ews, and therefore see no reason to change our 
analysis regarding the suggestion requested by the European Communities.  We therefore reject the 
EC's request. 
B. 
REQUEST OF THE UNITED STATES  
6.25 First, the United States requests that we modify paragraph 1.10 of our re port to reflect the fact 
that it was following a request by the United States that the Panel invited parties to make comments 
on the relevance to this dispute of the Appellate Body report in US – Stainless Steel (Mexico) .  In case 
the US request is granted, the European Communities requests that we also mention that the European 
Communities did not object to the US request.  We  have modified paragraph 1.10 in order to 
accommodate both parties' requests. 
6.26 Second, the United States requests the Panel to ch ange the description used for the measure at 
issue in connection with the EC's claim regardi ng the continued application of the duties resulting 
from 18 cases specified in the EC's panel request.  The United States notes that the EC's panel request 
takes issue with the continued application of, or the application of the specific anti-dumping duties 
resulting from 18 different cases identified in the a nnex thereto.  The United States therefore argues 
that the Panel should describe the measure at issue in this regard as "the continued application or 
application of anti-dumping duties in 18 cases" th roughout this report, instead of "continued 
application of 18 anti-dumping duties".  The Unit ed States, however, considers that for ease of 
reference, the Panel may prefer to use "continued application".  That is, the United States does not 
take issue with the Panel using "the continued ap plication" instead of "continued application or 
application" in the description of the measure at i ssue.  The United States, however, requests the Panel 
to refer to "anti-dumping duties in 18 cases" instead of  "18 anti-dumping duties" in the description of 
this measure.  In other words, the United States argues that the Panel should use, at a minimum, 
"continued application of anti-dumping duties in 18 c ases" instead of "continued application of the 18 
anti-dumping duties".  Although the United States rai ses this issue in connection with paragraph 3.3 
of our report, it requests the Panel to apply this change to the entirety of the report. 
6.27 The European Communities objects to the US re quest.  The European Communities, however, 
argues that should the Panel agree to change the descr iption used to refer to the measure at issue, it 
should use the actual language found in the EC's panel request, i.e., "the continued application of, or 
the application of the specific anti-dumping duties resulting from the anti-dumping orders in 18 cases". 
6.28 We recall, and the United States also acknowledges, that in footnote 4 of our report, we 
observe that the European Communities uses different formulations to describe the measure at issue in 
its panel request and in different places of its subm issions to the Panel, and explain that for ease of 
reference we refer to this measure as "the continue d application of the 18 duties" at issue.  It is 
therefore clear that the term that we use is only in tended to facilitate the multiple references that we 
make to the measure at issue throughout our report,  and by no means prejudges the legal significance 
that different descriptions for the same measure might have.  We have nevertheless changed the 
placement of footnote 4 and modified its content in order to further clarify this point. 
6.29 Third, the United States requests the Panel to modify paragraph 7.8 to clarify that the terms 
mentioned in that paragraph were used by past  panels and the Appellate Body to describe the 
measures at issue in other disputes.  The European  Communities did not object to this request, and we 
have made the requested modification. 
6.30 Fourth, the United States contends that the Panel should change the sixth sentence of 
paragraph 7.12 to clarify that the US argument concerned the EC's addition of 14 measures in its  WT/DS350/R 
 Page 11 
 
 
  panel request, rather that the description of "the  matter" in general.  The European Communities 
argues that there is no need for such a change because the senten ce at issue provides an accurate 
description of the US argument and the modificatio n sought by the United States would repeat what 
the last sentence of the paragraph at issue says. 
6.31 We agree with the European Communities that the sentence at  issue correctly describes the 
US argument.  We recall that this sentence fi nds basis in the US submissions to the Panel.22  We also 
note that the gist of the modification sought by the United States, i.e., the argument that measures not 
identified in the EC's consultations request fall out side the Panel's terms of reference, is already 
conveyed in the last sentence of paragraph 7.12.  We therefore decline to make the modification 
requested by the United States. 
6.32 Fifth, the United States refers to paragraph 7.25 of our report and argues that it would be 
inaccurate to consider that the United States does not dispute the similarity between the EC's claims in 
connection with the 38 determinati ons identified in the EC's consulta tions request and the claims in 
connection with the 14 determinations identified for the first time in the EC's panel request.  Because 
each determination is separate and distinct from the others, so are claims pertaining to such 
determinations.  The United States therefore reque sts that we modify the mentioned paragraph to 
eliminate this inaccuracy.  The European Communities argues that the United States misconstrues the 
Panel's statement in the mentioned paragraph and contends that there is no need to modify it. 
6.33 We note that the relevant part of paragra ph 7.25 notes the similarity between the claims  that 
the European Communities raises in connection with  the 38 determinations identified in the EC's 
consultations request and the claims raised in connection with the add itional 14 determinations 
identified in its panel request.  The paragraph at is sue then mentions that the United States does not 
contest this similarity.  This statement thus does not address the similarities or dissimilarities between 
the 38 and the 14 determinations, but rather betw een the claims concerning those determinations .  We 
have nevertheless modified pa ragraph 7.25 in order to fu rther clarify this point. 
6.34 Sixth, the United States argues that it would not be  accurate to state that as part of its request 
for a preliminary ruling in connection with the 14 additional measures identified in the EC's panel 
request, the United States cited the Appellate Body decision in US – Certain EC Products  without 
elaboration.  The United States requests the Panel to correct the relevant part of paragraph 7.26 in 
order to eliminate this inaccuracy.  The European  Communities did not object to this request, and we 
have modified paragraph 7.26 in or der to more accurately reflect the US argument in this regard. 
6.35 Seventh, the United States requests the Panel to change the phrase "indeterminate number of 
measures", used in paragraphs 7. 31, 7.34 and 7.42 below, to "indeterminate measures" because the 
latter explains the US arguments more accurately .  The European Communities contends that the 
phrase at issue, which is frequently used in th e US submissions, accurately reflects the US position 
and invites the Panel to decline the US request.  We  note that the phrase at issu e has been used by the 
United States itself in its submissions to the Panel.23  Furthermore, we are not convinced that this 
change would have any significan ce in our assessment of the EC's claims regarding the continued 
application of the 18 anti-dumping duties.  We therefore decline to make a modification to our findings in this regard. 
6.36 Eighth, the United States argues that paragraph 7. 32 contains two different arguments that the 
United States made in its Second Written Submission and requests that this paragraph be modified in 
order to better reflect those arguments.  The Eu ropean Communities contends that should the Panel 
agree to make the requested modification it s hould use the actual language found in the US 
                                                     
 
22 First Written Submission of the United States, paras. 55-58. 
23 See, for instance, First Written Submission of th e United States, paras. 44, 51, 66, 67 and 69. WT/DS350/R 
Page 12  
 
  submission.  We have modified paragraph 7.32 and added paragraph 7.53 in or der to provide a more 
accurate description of the US arguments. 
6.37 Ninth, the United States argues that paragraph 7.33 fails to fully reflect the US argument 
regarding the EC's characterization of the continua tion of the 18 duties as a measure and requests that 
this paragraph be modified.  The European Communities did not object to this request, and we have 
made the requested modification to the mentioned paragraph. 
6.38 Tenth, the United States contends that the last two sentences of paragraph 7.44 do not 
accurately reflect the US argument concerning the nature of the EC's claims on the continued 
application of the 18 duties and invites the Panel to modify it.  The European Communities submits 
that the Panel should reject the US request since the language that the United States suggests renders 
the meaning of the sentences at i ssue confusing.  The European Communities requests the Panel to 
take this into consideration shoul d the Panel consider to make the requested modification.  We have 
modified paragraph 7.44 taking into cons ideration the views of both parties. 
6.39 Eleventh, the United States argues that para graph 7.71 of our report does not reflect 
accurately the US arguments regarding the prel iminary determinations that the European 
Communities challenges in these proceedings.  The Un ited States requests that we change the last 
sentence of the mentioned paragraph to clarify th at the United States asserts that the European 
Communities failed to comply with any one of the two conditions set out under Article 17.4 of the 
Agreement.  The European Commun ities objects to the US request and argues that the paragraph at 
issue should not be modified as it accurately describ es the US argument.  Furthermore, the European 
Communities recalls that it did address the issue of  the significant impact of the preliminary 
determinations at issue.  We have modified pa ragraph 7.71 in order to reflect the US arguments 
regarding the preliminary determinations at issue, and in addition, have m odified paragraph 7.73 in 
order to clarify that the European Communities ra ised the issue of the impact of preliminary 
determinations made by the USDOC. 
6.40 Twelfth, the United States takes issue with the st atement in paragraph 7.80 of our report that 
the United States has not made substantive counte r-arguments regarding the EC's claims on the 
continued application of the 18 duties.  The United States argues that  because the European 
Communities stated that the legal basis of its cl aims regarding the continued application of the 
18 duties was identical to that of its claims re garding the 52 determinations, the US arguments 
concerning the EC's claims with respect to the 52 determinations equally respond to the EC's claims 
with respect to the continued application of the 18 duties.  In addition, the United States directs the 
Panel's attention to the substantive arguments it made  regarding the EC's claim under Article XVI:4 of 
the WTO Agreement in connection with the continue d application of the 18 duties.  The European 
Communities submits that where the United States intended to incorporate parts of its previous 
submissions in these proceedings, it did so explicitly.  There is, however, no such reference in the US 
submissions that would make the US arguments with respect to the 52 determinations equally 
applicable to the continued application of th e 18 duties.  The European Communities therefore 
requests the Panel to reject the US request. 
6.41 We agree with the European Co mmunities that there is no indication in the US submissions 
that the US arguments with respect  to the EC's claim concerning the 52 determinations were also 
applicable to the EC's claims with respect to the continued application of the 18 duties.  In any event, 
we recall that we have not addressed any of the EC's  claims regarding the con tinued application of the 
18 duties since we have concluded th at this measure falls outside our terms of reference.  We have, 
however, modified paragraph 7.80 to reflect th e US arguments regarding the EC's claim under 
Article XVI:4 of the WTO Agreement in connection w ith the continued application of the 18 duties.    WT/DS350/R 
 Page 13 
 
 
  6.42 The United States also requested that we delete  paragraph 6.78 of our  interim report because 
it did not reflect the arguments it had made regard ing the EC's claim under Article XVI:4 of the WTO 
Agreement.  The European Communities objected and argued that the Panel should only modify this 
paragraph to reflect the US arguments in this re gard.  Since we have summarized these US arguments 
in the new paragraph 7.80 of our report, we ha ve deleted paragraph 6.78 of our interim report. 
6.43 Thirteenth, the United States requests the Pa nel to replace the word "concedes" with 
"recognizes" in the second sentence of paragraph 7.88  because the United States did not concede the 
WTO-inconsistency of model zeroing in investiga tions, it simply recognized the Appellate Body's 
findings in US – Softwood Lumber V  and acknowledged that the same reasoning was applicable to the 
EC's claim in this dispute.  For the same reas ons, the United States requests the Panel to modify 
paragraphs 7.105 and 7.120 of the report.  The European Communities objects to the US request.  The 
European Communities notes that the United States di d not contest the WTO-inconsistency of model 
zeroing in investigations a nd acknowledged that the Appellate Body's reasoning in US – Softwood 
Lumber V  was "equally applicable" with respect to  the EC's claims in this dispute. 
6.44 We have modified paragraphs 7.88, 7.105 and 7. 120 in order to more accurately describe the 
US position with regard to the WTO-consiste ncy of model zeroing in investigations. 
6.45 Fourteenth, the United States requests three modifications to paragraph 7.123 of our report so 
that the US arguments regarding zeroing in periodi c reviews are better reflected.  The European 
Communities did not object to this request, a nd we have made the requested modifications. 
6.46 Fifteenth, the United States argues that the last sentence of paragraph 7.127 does not 
accurately reflect the US position regarding the WTO- consistency of model zeroing in investigations 
and requests the Panel to modify the mentioned sen tence.  The European Communities did not object 
to this request, and we have modified the sentence at issue in order to better reflect the US position. 
6.47 Sixteenth, the United States requests the Panel to  make three changes in paragraph 7.129 of 
our report in order to more accurately reflect th e US arguments.  The European Communities did not 
object to this request, and we have made the requested changes to paragraph 7.129. 
6.48 Seventeenth, the United States requests the Panel to make modifications to paragraphs 7.159 
and 7.161 so that the calculation methodology used  by the USDOC in periodic reviews is better 
described.  The European Communities did not object to  this request, and we have made the requested 
modifications. 
6.49 Eighteenth, the United States requests that a modi fication be made to pa ragraph 7.162 of our 
report to more accurately reflect the basis of one of  the aspects of the Appellate Body's reasoning in 
US – Stainless Steel (Mexico) .  More specifically, the United States takes issue with the use of the 
phrase "product as a whole" and submits that becaus e the Appellate Body in the mentioned decision 
did not rely on this phrase, the Panel should also refrain from using it.  The European Communities 
objects to the US request.  The European Communiti es contends that because the Appellate Body in 
US – Stainless Steel (Mexico) did use the concept of "product as a whole" in its reasoning, the Panel 
can also use it when referring to the Appellate Bo dy decision.  To support this contention, the 
European Communities refers to paragraphs of the Appellate Body decision other than those cited in 
paragraph 7.162 of our report.  In  paragraph 7.162 of our report, we  cite specific paragraphs of the 
Appellate Body decision at issue where, strictly sp eaking, the concept of "product as a whole" is not 
mentioned.  We have therefore modified paragr aph 7.162 in order to more accurately reflect the 
Appellate Body's decision in this regard.  
6.50 Nineteenth, the United States requests the Panel to modify the third sentence of 
paragraph 7.180 to clarify that security and predic tability for the multilateral trading system may be WT/DS350/R 
Page 14  
 
  provided if panels undertake an objective examinati on and do not add to or diminish the rights and 
obligations of Members.  According to the United St ates, "providing security and predictability to the 
multilateral trading system" is not distinct from "not adding to or diminishing the rights and obligations of Members".  The European Communiti es submits that the Panel should reject the US 
request.  The European Communities considers the statement in the sen tence at issue to be correct.  
We consider that while the proposition that when panels do not add to or diminish the rights and 
obligations of Members, this provides security and predictability to the multilateral trading system 
may be true in a general sense, it is not a prop osition which can be discerned from the text of the 
DSU.  Furthermore, we do not consider that the modification requested by the United States would clarify our reasoning or facilitate the resolution of th is dispute.  We therefore reject the US request. 
6.51 Twentieth, the United States contends that the Panel should modify its statement in 
paragraph 7.194 to state that it was not clear whether the past dumping margins relied upon by the investigating authorities in the sunset review at issue in US – Corrosion-Resistant Steel Sunset Review  
had been calculated inconsistently  with Article 2.4 of the Anti-Dumping Agreement.  The European 
Communities did not object to this request, and we ha ve modified paragraph 7. 194 in order to more 
accurately reflect the facts pertaining to the sun set review at issue in the mentioned dispute. 
6.52 Twenty-first, the United States submits that th e Panel should modify the third sentence of 
paragraph 8.4 below in order to better describe th e US argument regarding the suggestion that the 
European Communities seeks from the Panel.  Th e European Communities did not object to this 
request, and we have made the requested modifica tion in order to better reflect the US argument. 
6.53 We have also corrected some minor errors in  our interim report, which the United States 
brought to our attention. 
VII. FINDINGS 
A. 
RELEVANT PRINCIPLES REGARDING STANDARD OF REVIEW , TREATY INTERPRETATION AND 
BURDEN OF PROOF  
1. Standard of Review 
7.1 Article 11 of the DSU, which provides the standa rd of review for WTO panels in general, 
requires panels to carry out an "objective assessment of the matter", an obligation that applies to all 
aspects of a panel's examination of the "matter", both factual and legal.24   
7.2 Article 17.6 of the Anti-Dumping Agreement sets forth the special standard of review that 
applies in dispute settlement proceedings under the An ti-Dumping Agreement.  This provision reads:   
"In examining the matter referred to in paragraph 5:   
(i) in its assessment of the facts of the matter, the panel shall determine whether 
the authorities' establishment of the facts was proper  and whether their 
evaluation of those facts was unbiased and objective.  If the establishment of the facts was proper and the evaluation was unbiased and objective, even 
                                                     
 
24 Article 11 of the DSU provides in part:   
"The function of panels is to assist the DSB in discharging its responsibilities under this Understanding and the covered agreements.  Acco rdingly, a panel should make an objective 
assessment of the matter before it, including an  objective assessment of  the facts of the case 
and the applicability of and conformity with th e relevant covered agreements, and make such 
other findings as will assist the DSB in making the recommendations or in giving the rulings 
provided for in the covered agreements."    WT/DS350/R 
 Page 15 
 
 
  though the panel might have reached a different conclusion, the evaluation 
shall not be overturned;   
(ii) the panel shall interpret the rele vant provisions of the Agreement in 
accordance with customary ru les of interpretation of public international law.  
Where the panel finds that a relevant provision of the Agreement admits of 
more than one permissible interpretati on, the panel shall find the authorities' 
measure to be in conformity with the Agreement if it rests upon one of those permissible interpretations." 
Thus, taken together, Article 11 of the DSU a nd Article 17.6 of the Anti-Dumping Agreement 
establish the standard of review that we must a pply with respect to both the factual and the legal 
aspects of this dispute.   
 
2. Rules of Treaty Interpretation 
7.3 Article 3.2 of the DSU provides that the dispute settlement system serves to clarify the 
provisions of the covered agreements "in accordance with customary rules of interpretation of public 
international law".  It is generally accepted that these customary rules are reflected in Articles 31-32 
of the Vienna Convention on the Law of Treaties ("Vienna Convention" ).  Article 31(1) of the 
Vienna Convention  provides:   
"A treaty shall be interpreted in good faith  in accordance with the ordinary meaning 
to be given to the terms of the treaty in their context and in the light of its object and purpose."   
7.4 In the context of disputes under the Anti-Dumping Agreement, the Appellate Body has stated 
that:  
"The first sentence of Article 17.6(ii), echoing closely Article 3.2 of the DSU, states 
that panels  'shall' interpret the provisions of the AD Agreement  'in accordance with 
customary rules of interpretation of public international law'.  Such customary rules 
are embodied in Articles 31 and 32 of the Vienna  Convention on the Law of Treaties  
('Vienna Convention' ).  Clearly, this aspect of Article 17.6(ii) involves no 'conflict' 
with the DSU but, rather, confirms that th e usual rules of treaty interpretation under 
the DSU also apply to the AD Agreement . … 
The second  sentence of Article 17.6(ii) … presupposes  that application of the rules of 
treaty interpretation in Articles 31 and 32 of the Vienna Convention  could give rise to, 
at least, two interpretations of some provisions of the AD Agreement , which, under 
that Convention, would both be ' permissible  interpretations'.  In that event, a measure 
is deemed to be in conformity with the AD Agreement 'if it rests upon one of those 
permissible interpretations'."
25 (emphasis in original) 
7.5 Thus, under the Anti-Dumping Agreement, the sam e rules of treaty interpretation apply as in 
other disputes, with one distinction being that Artic le 17.6(ii) provides explicitly that if we find more 
than one permissible interpretation of a provision of the Anti-Dumping Agreement, we are required  to 
uphold a measure that rests on one of those interpretations.   
                                                      
25 Appellate Body Report, United States – Anti-Dumping Measures on Certain Hot-Rolled Steel Products 
from Japan ("US – Hot-Rolled Steel "), WT/DS184/AB/R, adopted 23 August 2001, DSR 2001:X, 4697, paras. 57 
and 59.   WT/DS350/R 
Page 16  
 
  3. Burden of Proof 
7.6 In WTO dispute settlement, a party claiming a violation of a provision of the WTO 
Agreement by another Member has the burden to assert and prove its claim.
26  The European 
Communities, as the complaining party, must therefore make a prima facie case of violation of the 
relevant provisions of the agreements at issue, wh ich the United States must refute.  We also note that 
it is generally for each party asserting a fact, whethe r complainant or respondent, to provide proof 
thereof.27  It follows that it is also for the United States to provide eviden ce for the facts which it 
asserts.  In this regard, we recall that a prima facie case is one which, in the absence of effective 
refutation by the other party, requires a panel, as a matter of law, to rule in favour of the party 
presenting the prima facie case.   
B. THE TERMS "MODEL ZEROING " AND "SIMPLE ZEROING " 
7.7 This dispute concerns the application in certain anti-dumping proceedings of a certain 
methodology that the European Communities describes as "zeroing".  This particular methodology, 
which is used in the calculation of the margin of dumping, in the view of the European Communities, 
does not reflect all the export transactions.  More specifically, the European  Communities takes issue 
with the use of the zeroing methodology in three di fferent contexts.  First, the European Communities 
challenges the use of zeroing in the context of inv estigations where the WA normal value is compared 
with the WA export price for different models of  the product under consideration and where such 
model-specific results are subseque ntly aggregated in the calculation of the margin for the product 
under consideration.  The European Communiti es describes this methodology as "model zeroing".  
Second, the European Communities challenges the u se of zeroing in periodic reviews where the WA 
normal value is compared with individual export transactions.  The European Communities calls this 
"simple zeroing".  Finally, the European Communiti es takes issue with the use in sunset reviews of 
dumping margins calculated either through model zer oing in prior investigations and/or through 
simple zeroing in prior periodic reviews. 
7.8 We note that the terms used by the European  Communities to describe different calculation 
methodologies are not found in the Anti-Dumping Agreement or the GATT 1994.  We also note, 
however, that these terms have been used by prior pa nels and the Appellate Body in the description of 
the specific measures at issue in those disputes.  We will, therefore, also use the same terms in 
describing the methodologies at issue in this dispute.   We would like to underline, however, that such 
use is for ease of reference only, and does not prejudge our assessment of the WTO-compatibility of the measures at issue.   
C. 
TERMS OF REFERENCE  
7.9 The European Communities does not raise an y "as such" claims in this dispute.28  That is, the 
European Communities does not challenge the WTO-consistency of the zeroing methodology per se .  
All of the EC's claims are "as applied" claims, i.e., they concern the use of the zeroing methodology in 
connection with certain anti-dumping duties or in cer tain anti-dumping proceedings.  The EC's claims 
relate to two sets of measures adopted by the United States:   
"First, the European Communities challenges the application or continued application 
of specific anti-dumping duties  resulting from the 18 anti-dumping orders in the 
                                                      
26 Appellate Body Report, United States – Measure Affecting Imports of Woven Wool Shirts and Blouses 
from India ("US – Wool Shirts and Blouses "), WT/DS33/AB/R and Corr.1, adopted 23 May 1997, 
DSR 1997:I, 323 at 337. 
27 Ibid. 
28 First Written Submission of the European Communities, para. 2.    WT/DS350/R 
 Page 17 
 
 
  Annex to the Panel request as calculated or maintained in place pursuant to the most 
recent administrative review or, as the case may be, original proceeding or changed 
circumstances or sunset review proceeding , since these anti-dumping duties are 
calculated and are maintained in place at  a level in excess of the dumping margin 
which would result from the correct application of the Anti-Dumping Agreement.   
Second, the European Communities ch allenges the application of zeroing  (i.e., either 
using the model or simple zeroing tec hnique) as applied in 52 anti-dumping 
proceedings , including original proceedings, administrative review proceedings and 
sunset review proceedings listed in  the Annex to the Panel request."29  (emphasis 
added) 
7.10 The United States presents three preliminary objections regarding the claims that the 
European Communities raises in connection with certa in measures and requests the Panel to find that 
such claims fall outside the Panel's terms of refere nce.  Our assessment with regard to each one of 
these three preliminary objections is provided below.   
1. Measures Not Included in the European  Communities' Consultations Request 
(a) Arguments of the Parties 
(i) United States 
7.11 The United States argues that the EC's panel re quest contains measures not included in its 
consultations request.  In this respect, the United States takes issue with two sets of measures.  First, the United States contends that the EC's consu ltations request does not reference the continued 
application of 18 specific anti-dumping duties.  Second, the United States argues that some of the 
52 measures that reflect the specific instances of application of the zeroing methodology were not 
included in the EC's consultations request.  More specifically, the United States recalls that the EC's 
initial consultations request
30 was limited to 38 specific measures, i.e., 33 periodic reviews, four 
original investigations and one sunset revi ew.  The EC's additional consultations request31 added two 
additional periodic reviews of which one was th en ongoing.  The EC's panel request, however, 
identifies 52 measures, adding 14 measures to the 38 that were subjected to consultations.  The 
14 new measures were seven final and three then-o ngoing sunset reviews and three final and one 
then-ongoing periodic reviews. 
7.12 The United States notes that under Article 7.1 of the DSU, it is the complaining party's panel 
request that determines a panel's te rms of reference.  Article 4.7 of the DSU, however, stipulates that 
the complaining Member may request the establishmen t of a panel only with respect to measures that 
have been subjected to consultations between the pa rties.  Furthermore, the United States notes that 
Article 4.4 of the DSU requires that the consultations  request identify the speci fic measures at issue.  
According to the United States, there is a cl ear progression between the measures discussed in 
consultations and those that appear in the panel request.  In this regard, the United States finds support 
in the Appellate Body's finding, in Brazil – Aircraft , that "Articles 4 and 6 of the DSU ... set forth a 
process by which a complaining party must request consultations, and consul tations must be held, 
before a matter may be referred to the DSB for the establishment of a panel."32  The United States is of 
the view that the matter which determines a panel's terms of reference, both in  the context of the DSU 
                                                      
29 First Written Submission of the Eur opean Communities, paras. 34-35. 
30 WT/DS350/1.   
31 WT/DS350/1/Add.1.   
32 Appellate Body Report, Brazil – Export Financing Programme for Aircraft ("Brazil – Aircraft "), 
WT/DS46/AB/R, adopted 20 August 1999, DSR 1999:III, 1161, para. 131. WT/DS350/R 
Page 18  
 
  and Articles 17.3 through 17.5 of the Anti-Dumping Ag reement, is the matter that is raised in the 
complaining party's consultations and panel requests.  Hence, measures not identified in the 
consultations request cannot subsequently be brough t into the scope of a dispute through the panel 
request. 
7.13 Based on this reasoning, the United States requ ests the Panel to rule that the 14 of the 
52 measures raised in the EC's panel request, and the measure described as "the application or 
continued application of the 18 anti-dumping duties," which were identified for the first time in the 
EC's panel request, are not within the Panel's term s of reference, and to refrain from making findings 
with regard to such measures.   
(ii) The European Communities 
7.14 The European Communities notes that the subject ma tter of this dispute has been described as 
the "continued existence and application of the zer oing methodology" in its request for consultations, 
and remained unchanged afterwards.  The EC's consultations request refers to the country and the 
product concerned in describing 18 anti-dumping dut ies, which the United States argues are outside 
the Panel's terms of reference.  It also cites, w ith reference to the country and the product concerned, 
specific anti-dumping proceedings where the contested zeroing methodology was used by 
the USDOC.  The description in the EC's pa nel request follows the same approach, i.e., it identifies 
both the continued application of the 18 anti-dumping duties and the specific proceedings where zeroing was used, by reference to the country and the product at issue.   
7.15 The European Communities acknowledges that some of the specific anti-dumping 
proceedings identified in its panel request did not appear in its consultations request.  It asserts, 
however, that such measures are nevertheless within th e Panel's terms of reference.  According to the 
European Communities, as long as the consultations  and the panel requests concern essentially the 
same matter, Articles 4 and 6 of the DSU, as interp reted in the relevant case law, do not require that 
the measures identified in these two documents be the same.  Since the measures identified in the EC's 
consultations request and the 14 measures identified in  its panel request are defined by reference to 
the relevant countries and the products, the Eur opean Communities contends that they concern 
essentially the same matter.  Furthermore, the Euro pean Communities asserts that the 14 measures at 
issue fall within the Panel's terms of reference since they have a direct relationship with the measures 
listed in the consultations request.  According to the European Communities, therefore, its claims 
pertaining to the 14 measures that appear for the first time in its panel request and the claims regarding the continued application of the 18 an ti-dumping duties are within the Panel's terms of 
reference.   
(b) Evaluation by the Panel 
7.16 The US request for a preliminary ruling regardi ng measures that are allegedly not identified in 
the EC's consultations request concerns two sets of measures:  a) the 14 additional specific anti-dumping proceedings, and b) the co ntinued application of the 18 an ti-dumping duties.  Below, we 
provide our evaluation of the US request regarding these two sets of measures, respectively. 
(i) The 14 Additional Anti-Dumping Proceedings 
7.17 There is no disagreement between the parties th at 14 specific anti-dumping proceedings that 
were identified in the EC's panel request had not been identified in its consultations request.  The 
United States argues that claims pertaining to measur es not identified in the EC's consultations request 
fall outside the Panel's terms of reference.  Th e European Communities argues that its claims in 
connection with the 14 proceedings at issue are wi thin the Panel's terms of reference because its 
consultations and panel requests concern essentially the same matter, i.e., continued existence and  WT/DS350/R 
 Page 19 
 
 
  application of the zeroing methodology.  The Eur opean Communities contends that its claims in 
connection with the 14 proceedings fall under th e Panel's terms of reference also because the 
14 proceedings have a direct relationship to the 38 pr oceedings identified in its consultations request.   
7.18 Since it is factually undisputed that the EC's pa nel request refers to 14 proceedings that were 
not identified in its consultations request, the issue to be resolved in this regard  is the extent to which 
the EC's consultations request affects our terms of reference.  In other words, the basic issue is 
whether the fact that certain measures were not iden tified in the EC's consultations request precludes 
us addressing claims raised in the EC's panel request  in connection with such measures.  If we find 
that claims pertaining to measures not identified in  the EC's consultations request fall outside the 
Panel's terms of reference, we shall refrain from addressing such claims.  If not, we have to address 
these claims. 
7.19 We note that pursuant to Article 7.1 of the DSU, the terms of reference of a panel are 
governed by the matter referred to the DSB in  the complaining Member's panel request.33  Article 6.2 
of the DSU sets out the requirements that appl y to requests for the establishment of a panel: 
"The request for the establishment of a pane l shall be made in writing.  It shall 
indicate whether consultations were held, identify the specific measures at issue and 
provide a brief summary of the legal basis of the complaint sufficient to present the 
problem clearly.  In case the applicant re quests the establishment of a panel with 
other than standard terms of reference, th e written request shall include the proposed 
text of special terms of reference."   
According to Article 6.2, therefore, a panel request must identify the specific measures at issue  and 
must provide a brief summary of the  legal basis of the complaint .  Together, these two elements 
comprise the "matter referred to the DSB", which fo rms the basis for a panel's terms of reference 
under Article 7.1 of the DSU.  It is important th at the panel request be sufficiently clear for two 
reasons:  First, it defines the scope of the dispute.  Second, it serves the due process  objective of 
notifying the parties and third parties of the nature of a complainant's case.34   
7.20 The US request for a preliminary ruling concerns  the significance, if any, that a complaining 
party's consultations request has on a panel's terms of reference.  We  generally note that the DSU does 
not contain a provision that addresses this sp ecific issue. Article 4 of the DSU, entitled 
"Consultations", provides in relevant parts:   
"Article 4 
Consultations  
... 
4. ... Any request for consultations shall be submitted in writing and shall give 
the reasons for the request, including id entification of the measures at issue  and an 
indication of the legal basis  for the complaint.   
                                                      
33 That a panel's terms of reference are determined by the complaining Member's panel request is a well 
established canon of WTO dispute settlement.  See, for instance, Appellate Body Report, United States – 
Countervailing Duties on Certain Corrosion-Resistant Carbon Steel Flat Products from Germany ("US – Carbon 
Steel "), WT/DS213/AB/R and Corr.1, adopted 19 December 2002, DSR 2002:IX, 3779, para. 124. 
34 Appellate Body Report, Brazil – Measures Affecting Desiccated Coconut ("Brazil – Desiccated 
Coconut "), WT/DS22/AB/R, adopted 20 March 1997, DSR 1997:I, 167, p. 22. WT/DS350/R 
Page 20  
 
  7. If the consultations fail
 to settle a dispute  within 60 days after the date of 
receipt of the request for consultations , the complaining party may request the 
establishment of a panel .  The complaining party may request a panel during the 60-
day period if the consulting parties jointly consider that consultations have failed to 
settle the dispute." (emphasis added) 
7.21  Article 17 of the Anti-Dumping Agreement wh ich contains parallel provisions regarding 
consultations between Members of the WTO rega rding matters that arise under the mentioned 
agreement, provides in relevant parts:   
"Article 17 
Consultation and Dispute Settlement  
17.1 Except as otherwise provided herein, the Dispute Settlement Understanding 
is applicable to consultations and the se ttlement of disputes under this Agreement. 
... 17.3 If any Member considers that any benef it accruing to it, directly or indirectly, 
under this Agreement is being nullified or impaired, or that the achievement of any 
objective is being impeded, by another Memb er or Members, it may, with a view to 
reaching a mutually satisfactory resolution of the matter, request in writing 
consultations with the Member or Members in question .  Each Member shall afford 
sympathetic consideration to any request from another Member for consultation.   
17.4 If the Member that requested consulta tions considers that the consultations 
pursuant to paragraph 3 have failed to achiev e a mutually agreed solution, and if final 
action has been taken by the administering authorities of the importing Member to 
levy definitive anti-dumping duties or to accept price undertakings, it may refer the 
matter  to the Dispute Settlement Body ("DSB").  When a provisional measure has a 
significant impact and the Member that requested consultations considers that the measure was taken contrary to the provisi ons of paragraph 1 of Article 7, that 
Member may also refer such matter to the DSB. 
17.5 The DSB shall, at the request of the complaining party, establish a panel to 
examine the matter based upon: 
(i) a written statement of the Member making the request indicating how a 
benefit accruing to it, directly or indirec tly, under this Agreement has been nullified 
or impaired, or that the achieving of the objectives of the Agreement is being 
impeded, and 
(ii) the facts made available in conform ity with appropriate domestic procedures 
to the authorities of the importing Member. 
..." (emphasis added) 
Article 4.4 of the DSU provides that a consultations  request has to identify the measures at issue and 
indicate the legal basis of the complaint.  Article 4.7 of the DSU, in turn, stipulates that if the parties 
fail to settle the dispute within 60 days from the re ceipt of the consultations request, the complaining 
Member may request the establishment of a panel.   Article 17.1 of the Anti-Dumping Agreement 
provides that the DSU applies to the consultations a nd the settlement of disputes that arise under the  WT/DS350/R 
 Page 21 
 
 
  Anti-Dumping Agreement.  Article 17.3 of the An ti-Dumping Agreement states that if a Member 
considers that any benefit accruing to it, directly or indirectly, under the mentioned Agreement is 
nullified or impaired, or that the achievement of any objective is impeded by another Member, it may 
request consultations with the Member concerned.  Ar ticle 17.4 states that if the parties fail to settle 
the dispute through consultations, the complaining Me mber may refer the matter  to the DSB to seek 
the establishment of a panel.  Finally, Article 17.5 s tipulates that the DSB shall, in such a situation, 
establish a panel to resolve the dispute. 
7.22 The provisions cited above do not directly address the issue of whether a complaining 
Member is barred from raising claims in connectio n with measures identified in its panel request, 
which were not identified in its consultations request .  Article 6.2, entitled "Establishment of Panels", 
requires that a panel request mention whether consulta tions were held, but it does not stipulate that the 
scope of the consultations request limits the scope of the claims that may subsequently be raised 
before a panel.  Article 4.7 of the DSU provides that  if parties fail to settle "the dispute" within 60 
days, the complaining Member may request the establis hment of a panel.  Similarly, Article 17.4 of 
the Anti-Dumping Agreement provides that if consu ltations fail, the complaining Member may refer 
"the matter" to the DSB.  These provisions, in our view, support the argument that as long as the 
consultations request and the panel request concern the same matter, or dispute, claims raised in 
connection with measures identified in the complain ing Member's panel request would fall within a 
panel's terms of reference even if those precise measures were not identified in the consultations 
request. 
7.23 We note that this issue also arose in some prio r disputes and that our reasoning in this case 
finds support in the reasoning developed by panels  and the Appellate Body in those disputes.  In 
Canada – Aircraft , the panel reasoned that as long as the c onsultations and panel re quests refer to the 
"same dispute", claims pertaining to that dispute would fall under the panel's terms of reference.35  
According to that panel, this approach would observe  the defendant's due process rights and at the same 
time recognize that the nature of the dispute coul d change between consultati ons and the establishment 
of a panel.36  It follows that the scope of a consultations request and that of a panel request do not 
necessarily have to be identical.  This reasoning was also followed by the panel in Brazil – Aircraft .  The 
panel in that case underlined the fact that a WT O panel's terms of reference are governed by the 
complaining Member's panel request, as  opposed to its consultations request.37  While acknowledging 
                                                      
35 The panel in Canada – Aircraft  held:   
"Accordingly, our terms of reference are determined by document WT/DS70/2, i.e., Brazil's 
request for establishment of this Panel.  Th is document refers expressly to "financing … 
provided by the Export Development Corporation …".  In principle, therefore, EDC 
"financing" falls within our jurisdiction.  As noted above, EDC "financing" would only fall outside our jurisdiction if EDC "financing" were not part of the "dispute" on which Brazil had 
requested consultations.  In our view, Brazil requ ested consultations in respect of a "dispute" 
concerning prohibited export subsidies allegedly provided to the Canadian civil aircraft industry by inter alia  EDC.  This "dispute" is also the subject of Brazil's request for 
establishment of this Panel.  Since the EDC "financing" identified in Brazil's request for 
establishment of a panel was part of the same "dispute" with respect to which consultations 
were requested, we find  that EDC "finan cing" falls within the Panel's jurisdiction. "  
(emphasis added) 
Panel Report, Canada – Measures Affecting the Export of Civilian Aircraft ("Canada – 
Aircraft "), WT/DS70/R, adopted 20 August 1999, upheld by Appellate Body Report, WT/DS70/AB/R, 
DSR 1999:IV, 1443, para. 9.14.   
36 Ibid., para. 9.12. 
37 The panel in Brazil – Aircraft  held:   
"We recall that our terms of reference are base d upon Canada's request for establishment of a 
panel, and not upon Canada's request for consultations.   These terms of reference were 
established by the DSB pursuant to Article 7.1 of the DSU and establish the parameters for 
our work.  Nothing in the text of the DSU or Article 4 of the SCM Agreement provides that WT/DS350/R 
Page 22  
 
  that the complaining Member should seek the establis hment of a panel with rega rd to the same dispute 
that was subjected to c onsultations, the panel in Brazil – Aircraft  reasoned that this  does not require a 
precise identity between the matter that was subject to  consultations and that with respect to which the 
establishment of a panel was requested.
38  On appeal, the Appellate Body upheld the panel's reasoning 
and reiterated the fact that the DSU does not require precise identity between the measures identified in 
the complaining Member's consultations reques t and those identified in its panel request.39   
7.24 The United States contends that the ruling of the Appellate Body in Brazil – Aircraft  is not 
relevant to the issue presented in this case.  In the view of the United States, although the new 
measures in Brazil – Aircraft  were regulatory instruments that  entailed periodic re-enactments of 
identical measures, the measures added to the EC's  panel request in this case are new and legally 
distinct determinations by the USDOC.  Although  the 14 new measures concern the same products 
originating in the same countries, they resulted from proceedings that are independent from those 
identified in the EC's consultations request.40   
7.25 In our view, whether the new measures were taken in proceedings that, as a matter of US law, 
are independent from one another is  but one relevant consideration in deciding whether such new 
measures are within our terms of reference.  We  note that the 14 and the 38 measures concern 
different determinations pertaining to the same  products originating in the same countries.  
Furthermore, these two groups of measures entail the alleged use of the same methodology, zeroing, 
which is the gist of the EC's claims before us.  In terms of the formulation of the EC's claims, there is 
no difference whatsoever between these two sets of me asures.  That is, the claims that the European 
                                                                                                                                                                     
the scope of a panel's work is governed by the scope of prior consultations. " (footnote omitted, 
emphasis added) Panel Report, Brazil – Export Financing Programme for Aircraft ("Brazil – Aircraft "), WT/DS46/R, 
adopted 20 August 1999, as modified by Appellate Body Re port, WT/DS46/AB/R, DSR 1999:III, 1221, para. 7.9.   
38 "Accordingly, we consider that a panel may c onsider whether consultations have been held 
with respect to a 'dispute', and that a prelimin ary objection may properly be sustained if a 
party can establish that the required consultations had not been held with respect to a dispute.  
We do not believe, however, th at either Article 4.7 of the DSU or Article 4.4 of the SCM 
Agreement requires a precise identity between th e matter with respect to which consultations 
were held and that with respect to which esta blishment of a panel was requested." (footnote 
omitted) Panel Report, Brazil – Export Financing Programme for Aircraft ("Brazil – Aircraft "), WT/DS46/R, 
adopted 20 August 1999, as modified by Appellate Body Re port, WT/DS46/AB/R, DSR 1999:III, 1221, para. 7.10.   
39 "We do not believe, however, that Articles 4 and 6 of the DSU, or paragraphs 1 to 4 of 
Article 4 of the SCM Agreement , require a precise and exact identity  between the specific 
measures that were the subject of consultati ons and the specific measures identified in the 
request for the establishment of a panel ...  We are confident that th e specific measures at issue 
in this case are the Brazilian export subsidies for regional aircraft under PROEX.  
Consultations were held by the parties on these subsidies, and it is these same subsidies that were referred to the DSB for the establishment of a panel.  We emphasize that the regulatory 
instruments that came into effect in 1997 and 1998 did not change the essence of the export 
subsidies for regional aircraft under PROEX." (footnote omitted, italic emphasis in original, underline emphasis added) 
Appellate Body Report, Brazil – Aircraft , supra , note 32, para. 132.  We also note that the panels in 
Japan – Agricultural Products  II, Mexico – Anti-Dumpi ng Measures on Rice  and US – Steel Plate  also made 
similar findings.  See, Panel Report, Japan – Measures Affecting Agricultural Products ("Japan – Agricultural 
Products II "), WT/DS76/R, adopted 19 March 1999, as modified by Appellate Body Report, WT/DS76/AB/R, 
DSR 1999:I, 315, para. 8.4(i);  Panel Report, Mexico – Definitive Anti-Dumping Measures on Beef and Rice, 
Complaint with Respect to Rice ("Mexico – Anti-Dumping Measures on Rice "), WT/DS295/R, adopted 
20 December 2005, as modified by Appellate B ody Report, WT/DS295/AB/R , DSR 2005:XXIII, 11007, 
para. 7.41;  Panel Report, United States – Anti-Dumping and Countervailing Measures on Steel Plate from India 
("US – Steel Plate "), WT/DS206/R and Corr.1, adopted 29 July 2002, DSR 2002:VI, 2073, para. 7.18. 
40 Second Written Submission of the United States, para. 13.  WT/DS350/R 
 Page 23 
 
 
  Communities raises in connection with the 38 a nd the 14 measures at issue are identical.  The 
United States does not dispute this similarity between the claims.  In our assessment of the US request for a preliminary ruling, we consider that the subs tantive similarity between the two sets of measures 
at issue, and the fact that they concern the same  country and the same product outweigh the fact that 
they represent independent determinations under US law. 
7.26 The United States maintains that its arguments on this issue are supported by the reasoning of 
the Appellate Body in US – Certain EC Products .  Specifically, the United States cites paragraphs 70 
and 82 of that report.
41  The Appellate Body's reasoning in that case, however, shows that it carried 
out a very detailed analysis regarding the relati onship between the two measures at issue in that 
dispute and came to the conclusion that these measur es were not sufficiently related so as to allow the 
complaining party to raise claims in connection w ith the (new) measure that was identified for the 
first time in its panel request.  Among others, the Appellate Body analysed differences regarding:  
(a) the content of the measures42,  (b) the government agenci es that issued the measures43 and (c) the 
legal linkage between the measures.44 
7.27 Given the striking similarities between the 14 new measures and the 38 measures identified in 
the EC's consultations request, however, we do not  agree that the Appellate Body's reasoning in US –
Certain EC Products  undermines our reasoning outlined above. 
7.28 We recall that there is a considerable similar ity between the 38 measures that were identified 
in the EC's consultations request and those that appe ared for the first time in the EC's panel request.  
These two sets of measures relate to the same products originating in the same countries.  More 
importantly, the legal nature of the EC's claims regarding the additional 14 measures does not in any 
way differ from that of the 38 measures identified in  the EC's consultations request.  The 14 measures 
entailed the same types of zeroing methodology as the 38 measures.  Hence, it is clear that the EC's 
consultations request and its panel request refer to the same subject matter, the same dispute.  We 
therefore reject the US request for a preliminary ru ling in this regard and find that the 14 measures at 
issue are within our terms of reference. 
(ii) Continued Application of 18 Anti-Dumping Duties 
7.29 We recall that in addition to the 14 new measu res that we have discussed, the United States 
also requests that the Panel find that the EC's claims pertaining to the continued application of the 18 anti-dumping duties also fall outside the Panel's terms of reference because this measure was identified for the first time in the EC's panel reque st.  Parties disagree as to whether the continued 
application of the 18 anti-dumping duties was iden tified in the EC's consultations request.  The 
United States asserts that this measure was identif ied for the first time in the EC's panel request 
whereas the European Communities contends that it wa s also identified in its consultations request.  
We note our finding below (para. 7.61) that the EC's claims regarding the continued application of the 
18 anti-dumping duties fall outside our terms of re ference because this purported measure does not 
meet the specificity requirement set out under Article  6.2 of the DSU.  We therefore need not, and do 
not, address the US assertion that the continued application of the 18 duties at issue also falls outside 
our terms of reference on the grounds that it was not raised in the EC's consultations request. 
                                                     
 
41 First Written Submission of the United States, pa ras. 59-60; Second Written Submission of the 
United States, para. 11. 
42 Appellate Body Report, United States – Import Measures on Certain Products from the 
European Communities ("US – Certain EC Products "), WT/DS165/AB/R, adopted 10 January 2001, 
DSR 2001:I, 373, para. 74.   
43 Ibid., para. 75.   
44 Ibid., paras. 76-77. WT/DS350/R 
Page 24  
 
  2. Specificity of the European Communities' Reference to 18 Cases 
(a) Arguments of the Parties 
(i) United States 
7.30 The United States recalls that the Panel's terms of reference are set by the claims raised in the 
EC's panel request.  Pursuant to Article 6.2 of the DSU, the EC's panel request has to identify, inter 
alia, the specific measures at issue.  The United States notes that the EC's panel request refers to the 
continued application of 18 specific anti-dum ping duties resulting from anti-dumping orders 
enumerated in the Annex to its panel request, as calcu lated or maintained in the most recent periodic 
review or, as the case may be, original proceed ing or changed circumstances or sunset review 
proceeding.  The United States contends that as fa r as the EC's claim regarding the application or 
continued application of the 18 duties is concerned,  the panel request fails to identify the specific 
measures at issue, as required under Article 6.2 of th e DSU.  According to the United States, it is not 
clear which specific measure this claim refers to.   
7.31 The United States notes the EC's statement that "t he application or continued application of 
the 18 duties" would also cover any subsequent pr oceeding that would modify such duty levels and 
argues that this formulation effectively requests the Panel to make findings on measures that are not in 
existence as of the date of the Panel's establishmen t.  The United States asserts that such a description 
fails to meet the specificity standard of Article 6.2 of the DSU.  The United States argues that the 
European Communities asks the Panel to make findi ngs that would apply to an indeterminate number 
of measures, which, according to the Un ited States, the DSU does not allow.   
7.32 The United States also points out that the Eur opean Communities seems to indicate that the 
18 measures cover the application or continued appl ication of the "zeroing" methodology in 18 cases.  
According to the United States, to the extent the European Communities is saying that it is 
challenging the application or con tinued application of zeroing in 18 cases (a description not found 
anywhere in its panel request), that "measure" lack s specificity.  The United States argues that "[t]he 
[European Communities] cannot make a generalized  reference to the application of zeroing in 
18 broadly-defined cases without indicating the exact determinations where 'zeroing' was applied."
45   
7.33 The United States objects to the EC’s argument asking the Panel to treat each duty as a free-
standing measure.  According to the United States, "the [European Communities] ignores the fact that, 
for any given importation, the antidumping duty assessed depends on a particular underlying 
administrative determination, whether that be an  original investigation, assessment review, new 
shipper review, or changed circumstances review, while the continuation of that duty depends on an 
underlying sunset review."46  The United States contends that "the [European Communities] must 
identify the specific determination leading to the par ticular application or continued application of an 
antidumping duty, and cannot merely refer to 'duty' in a general and detached way."47  T h e  
United States finds inconsistency in the Europ ean Communities arguing on the one hand that it does 
not raise any "as such" claims in this case and on the other hand presenting th e application of a duty 
as a self-standing measure.48   
7.34 The United States argues that permitting the European Communities to submit claims in 
connection with an indeterminate number of measures would seriously prejudice the US right of defence in these proceedings.  The Un ited States also contends that the European Communities has to 
                                                     
 
45 Second Written Submission of the United States, para. 23.   
46 (footnote omitted) Second Written Submission of the United States, para. 25. 
47 Ibid. 
48 Second Written Submission of the United States, para. 26.    WT/DS350/R 
 Page 25 
 
 
  comply with the requirements of the DSU regarding the identification of the specific measure at issue 
irrespective of whether failure to do so would prejudice the US due process rights since the DSU 
contains no such requirement. 
(ii) European Communities 
7.35 The European Communities disagrees  with the US assertion that the EC's panel request refers 
to an indeterminate number of measures.  The Eu ropean Communities notes that, with regard to the 
continued application of the 18 duties, the EC's pa nel request identifies the measures at issue with 
adequate precision:  "a duty rate based on the u se of the zeroing methodology which is being applied 
against imports of a specific product from a specific country".49  The European Communities argues 
that this description is consistent with the requi rements of the DSU just as the description of the 
practice of "zeroing" was considered to be so by the Appellate Body in previous zeroing disputes.  
According to the European Communities, as long as the cases from which arose the 18 duties at issue 
are described in the EC's panel request by refe rence to the countries, products and duty levels 
concerned, the fact that reference is not made to the last proceeding where su ch duties were modified, 
is irrelevant.50   
7.36 The European Communities notes, and disagrees wi th, the US point of view that measures 
challenged in WTO dispute settlement should either be a framework law, or a specific anti-dumping 
proceeding such as an investigation, a periodic re view or a sunset review.  According to the 
European Communities, as long as the content of  the measure is properly described in the 
complaining Member's panel request, the form in which the measure manifests itself is irrelevant.51   
7.37 The European Communities submits that, as elabor ated in the WTO juri sprudence, a measure 
which is closely related to the measure identified in  the complaining party's panel request also falls 
within a panel's terms of reference.  Accordingly,  measures introduced subsequent to the EC's panel 
request would fall in this Panel's te rms of reference to the extent th at they are related to the 18 anti-
dumping duties specifically cited in such request.   
7.38 The European Communities posits that the rationale behind the specificity requirement of 
Article 6.2 of the DSU is to protect the parties' due process rights in dispute settlement proceedings.  
It follows from the EC's argument that the Unite d States has to show that the alleged lack of 
specificity with regard to the 18 duties at issue has prejudiced its due process rights.  The European 
Communities contends, however, that the United States has failed to show such prejudice. 
(b) Arguments of Third Parties 
(i) Japan 
7.39 Japan submits that the EC's panel request defin es with sufficient clarity the measure at issue 
with regard to the 18 anti-dumping duties applied by the United States.  Japan asserts that the practice 
of zeroing is applied in all proceedings pertaining to an anti-dumping duty, including duty assessment 
proceedings, changed circumstances reviews and sunset  reviews.  It follows that the application or 
continued application of the 18 anti-dumping duti es at issue constitutes a measure for purposes of 
WTO dispute settlement.  Japan recalls the US argum ent with regard to the implementation of the 
DSB recommendations and rulings in the past zeroing  disputes that since the periodic reviews, found 
to be WTO-inconsistent, were superseded by sub sequent periodic reviews, the United States did not 
have to take any step with regard to the implem entation of such rulings and recommendations.  Japan 
                                                      
49 Second Written Submission of the European Communities, para. 53.   
50 Response of the European Communities to the US Request for Preliminary Rulings, para. 37. 
51 Second Written Submission of the European Communities, para. 55. WT/DS350/R 
Page 26  
 
  argues that this approach undermines the effectiven ess of WTO dispute settlement and that the EC's 
description of the measure at issue in this dispute effectively precludes this possibility. 
(c) Evaluation by the Panel 
7.40 We recall that it is the EC's panel request that  determines our terms of reference in these 
proceedings.  Article 6.2 of the DSU stipulat es that a panel request has to identify the specific 
measures at issue  and provide a brief summary of the legal basis  of the complaint.  We note that the 
controversy regarding the EC's claim in connectio n with the continued application of the 18 anti-
dumping duties at issue concerns the identification of the specific measures at issue.  There is no 
disagreement between the parties regarding the inclus ion in the EC's panel request of a brief summary 
of the legal basis of the complaint.   
7.41 At the outset, we would like to address an ar gument raised by the European Communities, 
which concerns the burden of proof.  The Eur opean Communities argues that the United States does 
not dispute that the measure identified by the Eu ropean Communities exists, nor does it contest the 
precise content of such measure as describ ed by the European Communities.  The 
European Communities therefore contends that the US preliminary objection in this regard lacks 
merit.
52  We note, however, that the United States do es object to the identification of the specific 
measures at issue and that is the very reason why it has raised this preliminary objection.  
Furthermore, we recall that in accordance with th e rules governing the burden of proof which we have 
to apply in this case ( supra , para. 7.6), it is for the European Communities to make a prima facie  case 
before the burden shifts to the United States to rebut it.   
7.42 The European Communities explicitly states that it is not raising any "as such" claims in this 
dispute.53  That is, the European Communities is not  challenging the zeroing methodology "as such", 
because, according to the European Communities, this has alre ady been decided by the Appellate 
Body.  All of the EC's claims, therefore, are to be considered as challenging particular instances of application of the zeroing methodology.  There is no disagreement between the parties that the EC's claims regarding the 52 proceedings concern the application of the zeroing methodology in specific 
instances.  The nature of the EC's claims rega rding the continued application of the 18 duties, 
however, has not been made clear.  The United States argues that the way this measure is described in 
the EC's panel request amounts to challenging an indeterminate number of measures and requests the 
Panel to find, on the grounds of lack of specifici ty, that the EC's claims in connection with the 
continued application of the 18 duties fall outside the Panel's terms of reference.  The European 
Communities, however, contends that its description of the measures at issue is in compliance with 
the DSU since it identifies the countries and the pr oducts concerned in connection with each one of 
the 18 duties at issue.   
7.43 The issue therefore is whether the continued a pplication of the 18 duties at issue has been 
identified in the EC's panel request in a manner that meets the specificity standard set out under 
Article 6.2.   
7.44 We note that the discussions between the parties in this regard partly focus on whether the 
EC's claims regarding the continued application of the 18 duties are "as such" or "as applied" claims.  
The European Communities argues that  the measures at issue with rega rd to its claim regarding the 
continued application of the 18 duties are instances of application
 of the zeroing methodology, not the 
methodology "as such".  According to the European Communities, in order to be subject to dispute 
settlement, a measure needs not be "a norm or inst rument".  The European Communities contends that 
                                                      
52 Response of the European Communities to Question 1(a) from the Panel Following the First 
Meeting.   
53 First Written Submission of the European Communities, para. 2.    WT/DS350/R 
 Page 27 
 
 
  "the mere fact that ... the measure has a life stretchi ng an indeterminate time into the future, is no bar 
to the measure being subject to dispute settlement".54  The United States, for its part, recalls that the 
European Communities argues that it is not raising any "as such" claims in this case which, according 
to the United States, means that all of the EC’s clai ms should be considered "as applied" claims.  The 
United States argues that the EC’s attempt to describe a duty as a free-standing measure creates, by 
the EC’s own admission, some sort of ambiguous "as applied/as such" measure.  According to the 
United States, it is not clear whether the Europ ean Communities is in f act making an "as such" 
claim.55 
7.45 At the outset, we recall the Appellate Body's pronouncement that "[i]n principle, any act or 
omission attributable to a WTO Member can be a measure of that Member for purposes of dispute 
settlement proceedings".56  We note that the distinction between "as such" and "as applied" claims is 
not found in the text of the DSU.  It has been deve loped in the jurisprudence.  It is well known that 
some GATT panels, as well as WTO panels and th e Appellate Body, have examined not only 
measures consisting of acts that appl y to particular situations, but also those consisting of acts setting 
forth rules or norms that have ge neral and prospective application.57  Claims taking issue with 
measures of general and prospective application ar e generally called "as such" claims, whereas those 
targeting acts that apply to specific situat ions are called "as applied" claims.   
7.46 In our view, the distinction between "as such" and "as applied" claims does not govern the 
definition of a measure for purposes of WTO dispute settlement, nor is this distinction intended to 
replace or override the requirements of Article 6. 2 of the DSU as to how measures have to be 
identified in a panel request.  In principle, the me re fact that a measure do es not fall under either of 
these categories should not determine whether the id entification of that measure conforms to the 
requirements of Article 6.2 of the DSU.  Consequen tly, even if we refer to this distinction in our 
assessment of the issue before us, we shall refrain from attributing a decisive function to it.  Rather, 
we shall base our assessment on the provisions of th e DSU, Article 6.2 thereof in this instance, and 
evaluate the text of the EC's panel requ est in light of the cited provision.   
7.47 With that in mind, we now turn to the EC's panel request.  The EC's panel request identifies 
the specific measures at issue in this  dispute in the following manner:   
"The measures at issue and the legal basis of the complaint include, but are not 
limited to, the following: 
The continued application of, or the application of the specific anti-dumping duties 
resulting from the anti-dumping orders enumer ated from I to XVIII in the Annex to 
the present request as calculated or mainta ined in place pursuant to the most recent 
administrative review or, as the case may be, original proceeding or changed 
circumstances or sunset review proceedi ng at a level in excess of the anti-dumping 
margin which would result from the correct application of the Anti-Dumping 
Agreement (whether duties or cash deposit rates or other form of measure).  
In addition to these measures , the administrative reviews, or, as the case may be, 
original proceedings or changed circumstan ces or sunset review proceedings listed in 
                                                      
54 Response of the European Communities to Question 3 From the Panel Following the First Meeting.   
55 Closing Statement of the United States at the First Meeting, paras. 11-13;  Second Written 
Submission of the United States, para. 26.   
56 Appellate Body Report, United States – Sunset Review of Anti-Dumping Duties on Corrosion-
Resistant Carbon Steel Flat Products from Japan  ("US – Corrosion-Resistant Steel Sunset Review "), 
WT/DS244/AB/R, adopted 9 January 2004, DSR 2004:I, 3, para. 81. 
57 For a comprehensive citation of such panel and Appellate Body reports, see Appellate Body Report, 
US – Corrosion-Resistant Steel Sunset Review ,  Ibid. , footnote 80.   WT/DS350/R 
Page 28  
 
  the Annex (numbered 1 to 52
) with the specific anti-dumping orders and are also 
considered by the EC to be measures subj ect to the current request for establishment 
of the panel in addition to the anti-dumping orders."58  (footnote omitted, emphasis 
added) 
7.48 We note that the panel request, and the EC's subm issions, take issue with two different sets of 
measures.  First, the European Communities identif ies 18 cases by reference to the country and the 
product involved and argues that the continued appl ication of the duties calculated through zeroing in 
such cases violates the Anti-Dumping Agreement.  Second, the European Communities challenges the 
use of zeroing in 52 specific anti-dumping proceed ings (investigations, duty assessment proceedings 
and sunset reviews) that pertain to these 18 cases.   
7.49 We note that the part of the EC's panel request challenged by the United States takes issue 
with the continued application of the 18 anti-dumpi ng duties listed in the annex to the panel request, 
as calculated or maintained in the most recent proc eeding pertaining to such duties.  On its face, we 
find this description ambiguous, particularly because the panel request does not sufficiently 
distinguish between the continued application of the 18 duties and the use of zeroing in the 52 specific 
proceedings at issue.  Clearly, the continued appl ication of the 18 duties does not take issue with 
zeroing per se  because, as the European  Communities acknowledges, the zeroing methodology "as 
such" is not challenged in this dispute.  Nor does it seem to take issue with specific proceedings, such 
as investigations, different types of reviews, wher e zeroing has allegedly been applied.  Otherwise, 
there would have been no need to also challenge 52 specific proceedings that pertain to the same 
duties.   
7.50 We recall the Appellate Body's pronouncement that any act or omission can, in principle, 
constitute a measure for purposes of WTO dispute settlement.59  In our view, this statement clarifies 
that the concept of a measure for purposes of WTO la w covers a wide range of acts or instruments.  
The fact remains, however, that in order to su ccessfully raise claims against a measure, the 
complaining Member must in the first place demonstr ate the existence and the precise content of such 
measure, consistently with the requirements of Article 6.2 of the DSU.  Unless the measure is 
adequately identified in the complaining Member's panel request, therefore, that Member cannot raise 
claims in connection with that purported measure. 
7.51 The European Communities argues that as long as its panel request  identifies the measure at 
issue with reference to the country and the prod uct concerned, such description would meet the 
requirements of Article 6.2 of the DSU.  The European Communities cites the panel reports in 
Argentina-Footwear  and Canada-Wheat  to support the view that it is the identification of the measure 
at issue, not the exact description of the legal inst rument in which the measure is found, that matters 
for purposes of Article 6.2 of the DSU.60  As the European Communities notes, the issue in the cited 
two cases was whether Article 6.2 of the DSU require d, in addition to the description of the specific 
measure at issue, a full description of the legal inst rument in which the measure was found.  In this 
regard, we see a significant difference between the issue presented in those cases and the one before 
us in this dispute.  The issue in this case does not concern the description of the legal instrument that 
embodies the challenged measure.  Rather, the issue he re is the identification of the measure itself.  
Hence, we do not consider the references to Argentina – Footwear  and Canada – Wheat  pertinent.   
7.52 The European Communities contends that measures that are subsequent or closely related to 
those identified in the complaining Member's pane l request also fall within a panel's terms of 
                                                      
58 WT/DS350/6, p. 3. 
59 Supra , note 56.   
60 Response of the European Communities to the US Request for Preliminary Rulings, paras. 37-38.    WT/DS350/R 
 Page 29 
 
 
  reference.61  The European Communities provides exam ples from the jurisprudence in order to 
support this proposition.  For instance, the Eur opean Communities cites the panel decision in Japan – 
Film.   Regarding the specificity requirement of  Article 6.2, that panel reasoned:   
"The question thus becomes whether the ordina ry meaning of the terms of Article 6.2, 
i.e., that "the specific measures at issue" be  identified in the panel request, can be met 
if a "measure" is not explicitly described in  the request.  To fall within the terms of 
Article 6.2, it seems clear that a "measure" not explicitly described in a panel request 
must have a clear relationship to a "measure" that is specifically described therein, so that it can be said to be "included" in the specified "measure".  In our view, the requirements of Article 6.2 would be met in the case of a "measure" that is subsidiary 
or so closely related  to a "measure" specifically identified, that the responding party 
can reasonably be found to have received ad equate notice of the scope of the claims 
asserted by the complaining party.  The tw o key elements -- close relationship and 
notice -- are inter-related:  only if a "measure " is subsidiary or closely related to a 
specifically identified "measure" will notice be adequate.  For example, we consider 
that where a basic framework law dealing w ith a narrow subject matter that provides 
for implementing "measures" is specified in a panel request, implementing "measures" might be considered in appropr iate circumstances as effectively included 
in the panel request as well for purposes of Article 6.2.  Such circumstances include the case of a basic framework law that sp ecifies the form and circumscribes the 
possible content and scope of implementing "measures".  As explained below, this 
interpretation of Article 6.2 is consistent with the context and the object and purpose 
of Article 6.2, as well as past panel practice."
62 (emphasis added) 
"In our view, "measures" that are subsidiary or closely related to specified "measures" 
can be found to be "adequately identifie d" as that concept was applied in the 
Bananas III  case."63 (emphasis in original) 
7.53 The United States argues that the EC’s challenge to the application or continued application 
of duties related to all subsequent and previously unidentified proceedi ngs is not the equivalent of the 
situation in Japan – Film , as the European Communities claims.  According to the United States, the 
application or continued application of anti-dumpi ng duties results from distinct legal proceedings 
leading to a final determination.  Each proceeding,  whether an original investigation, administrative 
review, or sunset review, involves different time  periods, different entries of merchandise, and 
different information and data.  The United States argu es that this is not the equivalent of the situation 
in Japan – Film , which involved a challenge to subsequent regulations issued unde r a law of general 
application.64 
7.54 We have two observations regardi ng the EC's reference to this panel report.  First, the factual 
circumstances of Japan – Film  were considerably different from those before us.  In Japan – Film , a 
measure was identified in the complaining Member's panel request consistently  with Article 6.2, and 
another measure which was closely related to the me asure already identified in the panel request was 
raised in the subsequent panel proceedings.  Th e issue in the present dispute, however, centres on 
whether the description of the measure in the EC's panel request meets the requirements of 
Article 6.2.  Second, the measures that the panel in Japan – Film  found to be closely related to the 
measures specifically raised in the complaining pa rty's panel request were in existence during the 
                                                      
61 Ibid., para. 43. 
62 Panel Report, Japan – Measures Affecting Consum er Photographic Film and Paper  ("Japan – Film "), 
WT/DS44/R, adopted 22 April 1998, DSR 1998:IV, 1179, para. 10.8.   
63 Ibid., para. 10.10.   
64 Second Written Submission of the United States, paras. 21-22. WT/DS350/R 
Page 30  
 
  panel proceedings.
65  In other words, there was no disagre ement regarding the existence of the 
subsequent measures.  The issue was whether the subsequent measures were sufficiently related to 
those identified in the panel request such that they  could properly be consid ered within the panel's 
terms of reference.  The same applies to the measures challenged in EC – Bananas III66 and 
Argentina – Footwear67, also cited by the European Communitie s.  In the dispute at hand, however, 
parties disagree as to the very existence of th e measure identified in the EC's panel request, i.e., the 
continued application of the 18 duties.  We therefore do not consider the reasoning of the panel in Japan – Film  to be relevant to the issue presented in these proceedings.   
7.55 The European Communities argues that the measures to which the phrase "continued 
application of the 18 duties" refers, are duties.  In  this regard, a duty refers to "an anti-dumping duty 
on a particular product exported from the [Eur opean Communities] and imported into the 
[United States]"
68 which remains in place from imposition until termination.  The 
European Communities describes the co ntent of the duty as being duty rates calculated on the basis of 
zeroing.  The European Communities provides an e xplanation of what zeroing is.  The European 
Communities refers to the past Appellate Body reports on zeroing and contends that: 
"In US – Zeroing (EC)  and in US – Zeroing (Japan) , the Appellate Body has accepted 
that both the EC and Japan have described the "precise content" in the context of the methodology itself.  It necessarily follows that  what the EC has described in each of 
the 18 measures – which is the same - also meets the "precise content"  
requirement. "69  (footnotes omitted, italic emphasis in original, underline emphasis 
added) 
We note that the European Communities argues that the content of the specifi c measures at issue in 
connection with the continued application of the 18 duties is the same as the content of the measures 
addressed by the Appellate Body in US – Zeroing (EC)  and US – Zeroing (Japan) .  This argument 
equates the continued application of the 18 duties at issue with the zeroing methodology "as such", 
addressed in the cited two prior disputes.  Given th e EC's clear statement that it is not challenging 
zeroing "as such" in this case, we find this proposition to be internally inconsistent and reject it.   
7.56 The European Communities also asserts:   
"The "norm or instrument" in this cont ext is the zeroing methodology "as such" – 
although it is not necessary to demonstrate that a "measure" is a "norm or instrument" in order for it to be subject to dispute settlement.  The 18 measures are instances of 
the application of the zeroing methodology .  In the view of the EC, in order for the 18 
measures to be measures for the purposes of dispute settlement, they do not need to 
be characterised as "norms or instruments".  However, they are as much "norms or 
instruments" as is, for example, a programme under the SCM Agreement .  The mere 
fact that duties (or subsidies) vary over time; and that the measure has a life stretching 
                                                      
65 Ibid., paras. 10.12-10-19.   
66 Panel Report, European Communities – Regime for the Impo rtation, Sale and Dist ribution of Bananas, 
Complaint by Ecuador ("EC – Bananas III (Ecuador) "), WT/DS27/R/ECU, adopted 25 September 1997, as 
modified by Appellate Body Report, WT/D S27/AB/R, DSR 1997:III, 1085, para. 7.27.   
67 Panel Report, Argentina – Safeguard Measures  on Imports of Footwear ("Argentina – 
Footwear (EC) "), WT/DS121/R, adopted 12 January 2000, as modified by Appellate Body Report, 
WT/DS121/AB/R, DSR 2000:II, 575, para. 8.37.   
68 Response of the European Communities to Question 1(a) from the Panel Following the First 
Meeting. 
69 Ibid.  WT/DS350/R 
 Page 31 
 
 
  an indeterminate time into the future, is no bar to the measure being subject to dispute 
settlement."70  (emphasis added) 
We note that the European Communities attempts to categorize the continued application of the 
18 duties somewhere in between zeroing "as such" a nd zeroing "as applied".  In principle, we agree 
with the EC's proposition that in order for the cont inued application of the 18 duties to constitute a 
measure, it need not constitute a norm or instrument.  In our view, the title attributed to a measure has 
no bearing on whether it constitutes a measure fo r purposes of WTO dispute settlement.  The fact 
remains, however, that the European Communities h as to demonstrate the existence and the precise 
content of the purported measure.  In this regard, we  also do not consider pertinent the fact that the 
European Communities places the continued applicati on of the 18 duties between an "as such" and an 
"as applied" claim.  Such categorization in th e abstract does not provide sufficient explanation 
regarding the existence and the precise content of the alleged measure.  We also disagree with the 
analogy that the European Communities makes betwee n the continued application of the 18 duties at 
issue and a subsidy programme.  A subsidy progra mme may be identified through different means, 
including the relevant legal instruments, payments  made by the governments,  etc.  In this case, 
however, the European Communities challenges the con tinued application of 18 duties, which, in and 
of itself, does not amount to the identification of a measure.  We recall that zeroing "as such" and "as 
applied" in various types of anti-dumping proceed ings may be, and has been, challenged in WTO 
dispute settlement.  We note, however, that what  the European Communitie s describes as a measure 
in these proceedings is the continued application of  18 duties, in isolation from any proceeding in 
which such duties have been calculated, allegedly through zeroing.  As such, we do not consider this 
to represent a measure in and of itself.   
7.57 Regarding the difference between the continued application of the 18 duties and the use of 
zeroing in the 52 anti-dumping proceedings identified in its panel request, the European Communities 
argues:   
"Finally, the Panel asks the EC to explai n the difference between the 18 measures at 
issue and the 52 measures at issue. As note d above, the first set of measures disputed 
by the EC constitute the application or  continued application of the zeroing 
methodology in the form of anti-dumping duties which are calculated with zeroing in the 18 cases referred to in the Annex – each of which has a specific US DOC reference number.  The 52 measures at i ssue constitute documents pursuant to which 
the duty is first imposed, or varied and/or finally collected.  There may be a partial 
overlap between the two sets of measures in the sense that the 52 measures may be 
regarded as specific documentary manifestations of, or instances of the application of, 
the 18 measures.   However, the two sets of measures are different since the 
18 measures are defined at a more general level than the 52 measures. As a result, the EC considers that findings concerning the 18 measures will have a broader impact 
than those concerning the 52 measures. "71  (emphasis added) 
7.58 The European Communities acknowledges that th ere is some overlap between these two sets 
of measures.  We recall that Article 6.2 of the DSU requires that the specific measures at issue be identified in the complaining Member's panel request.  This obligation, in our view, applies to each 
and every measure regarding which the complaining Me mber considers to raise claims.  In the dispute 
at hand, this means that if the European Communiti es wishes to raise claims in connection with the 
continued application of the 18 duties at issue, it has to, in the first place,  identify that measure 
independently from other measures with regard to whic h it raises other claims.  In the face of the EC's 
                                                     
 
70 Response of the European Communities to Question 3 from the Panel Following the First Meeting. 
71 Response of the European Communities to Question 1(a) from the Panel Following the First 
Meeting.   WT/DS350/R 
Page 32  
 
  acknowledgement that there is overlap between the continued application of the 18 duties and the 
52 proceedings, we find illogical the EC's argument th at the former is within the Panel's terms of 
reference. 
7.59 In our view, another flaw in the EC's argumen ts regarding the continued application of the 
18 duties at issue is that the European Communities seems to seek a remedy which would affect anti-
dumping proceedings that the USDOC may conduct in the future.  Indeed, th e European Communities 
does not deny this fact:   
"The EC is not asking the Panel to make findings about "future measures", any more 
than a Member that seeks findings about an SCM programme  is seeking findings 
about future instances of the application of such programme.  Rather, the EC is 
seeking findings with respect to a measure that , by its own terms, has a life (that is, a 
period of time during which it is destined to be  in force) that stre tches into the future
.  
That is no bar to the measure being the subject of dispute settlement."72  (italic 
emphasis in original, underline emphasis added) 
"However, the two sets of measures are different since the 18 measures are defined at 
a more general level than the 52 measures.  As a result, the EC considers that findings 
concerning the 18 measures will have a broader impact than those concerning the 
52 measures. "73 (emphasis added) 
We note that the remedy sought by the European Co mmunities will affect the determinations that the 
USDOC might make in anti-dumping proceedings that  may be conducted in the future.  In other 
words, if granted, the findings sought by the Eu ropean Communities will have an impact on measures 
that did not exist at the time of the establishment of the Panel, nor during the panel proceedings.  In 
our view, Article 6.2 of the DSU, in principle, does not allow a panel to make findings regarding 
measures that do not exist as of the date of the pa nel's establishment.  There may be exceptional cases 
where panels may consider to make findings on measures not identified in the complaining party's 
panel request if circumstances justify it.  For that  to happen, however, the new measure or measures 
have to constitute "a measure" within the meaning of Article 6.2 of the DSU and have to come into 
existence during the panel proceedings. 
7.60 We note that the European Communities repeated ly refers to the US alleged failure to 
implement the DSB recommendations and rulings in the past zeroing cases.  This suggests that the 
European Communities somehow links its claims rega rding the continued application of the 18 duties 
at issue to the US alleged failure to implemen t the DSB recommendations and rulings in the past 
zeroing cases.  The European Communities does not argue  that the measures at issue in this dispute 
are measures taken to comply with the DSB reco mmendations and rulings in previous zeroing cases 
within the meaning of Article 21.5 of the DSU.74  It, however, submits that the fact that the 
United States failed to implement the DSB recommenda tions and rulings in previous zeroing cases is 
relevant to the Panel's assessment of the EC's claims in this case:   
"From the perspective of the need for security and predicta bility, the fact that past 
Appellate Body Reports have already decided the issues before the Panel, and that the 
                                                      
72 Response of the European Communities to Question 5(b) from the Panel Following the First 
Meeting.   
73 Response of the European Communities to Question 1(a) from the Panel Following the First 
Meeting. 
74 Response of the European Communities to Question 4(a) from the Panel Following the First 
Meeting.    WT/DS350/R 
 Page 33 
 
 
  entire US defence is premised on rejecting those past Appellate Body Reports, is 
legally relevant to the Panel's assessment of all the EC claims."75 
The European Communities does not, however, articul ate how exactly the US alleged failure to 
implement the DSB recommendations and rulings in th e past zeroing cases is legally relevant to the 
present dispute.  In our view, each dispute settle ment proceeding at the WTO is independent from 
others, except proceedings initiated under Article 21. 5 of the DSU which are naturally linked to the 
relevant original proceedings.  Under Article 21.5 of the DSU, a Member is entitled to bring a case 
against another Member that fails to comply with  the DSB recommendations and rulings following an 
original proceeding.76  The European Communities clearly po ints out that it does not see these panel 
proceedings as a forum where the alleged non-compli ance in some past cases may be discussed.  Yet, 
it argues, without convincing reasoning, that such no n-compliance is somehow relevant to the Panel's 
evaluation of the EC's claims in this case.  For th e reasons that we have e xplained, this proposition 
lacks a legal basis. 
7.61 On the basis of the foregoing considerations, we  find that the European Communities failed to 
identify the specific measure at issue in connection w ith its claims regarding the continued application 
of the 18 anti-dumping duties at issue.  Consequently, we find that such claims do not fall within our 
terms of reference in these proceedings.   
7.62 The European Communities contends that th e purpose of the specificity requirement 
embodied in Article 6.2 of the DSU is to protect th e defendant's due process rights.  Thus, in order to 
prevail in its request for a preliminary ruling with regard to the continued application of the 18 duties 
at issue, the United States has to show that the alleged imperfection in the EC's panel request has 
prejudiced the US due process rights.  Since the Unit ed States has not shown such prejudice, the Panel 
should find the EC's claims in connection with the c ontinued application of the 18 duties to be within 
its terms of reference.  The European Comm unities cites the Appellate Body reports in EC – 
Computer Equipment  and Korea – Dairy , and the panel report in Canada – Wheat  to support its 
argument.77  The United States disagrees with the EC's  contention and maintains that neither 
Article 6.2 of the DSU nor any other provision of  the WTO Agreement contains such a prejudice 
requirement.  According to the United States, if the complaining Member's panel request fails to 
identify the specific measures at i ssue, claims in connection with such measures would fall outside a 
panel's terms of reference.78   
7.63 We recall that a panel can only address claims that are raised in the complaining Member's 
panel request, consistently with th e requirements of Article 6.2 of the DSU.  We note that neither 
Article 6.2 of the DSU nor any other provision of the WTO Agreement supports the argument that the 
defendant has to show prejudice in cases where the complaining Member's panel request falls short of the requirements of Article 6.2.  Such argume nt would undermine the due process objective embodied 
in Article 6.2 because it would allow the complaining Member to correct the inadequacies in its panel 
request, during panel proceedings.
79   
7.64 We note that the Appellate Body's statement in EC – Computer Equipment , which the 
European Communities cites, was ma de in the particular circumstances of that dispute.  The main 
                                                      
75 Response of the European Communities to Question 4(a) from the Panel Following the First 
Meeting. 
76 Indeed, the European Communities used this option in the US – Zeroing (EC)  dispute and initiated a 
proceeding against the United States under Artic le 21.5 of the DSU.  See, WT/DS294/25. 
77 Response of the European Communities to the US Request for Preliminary Rulings, paras. 40-42.   
78 Second Written Submission of the United States, para. 28.   
79 Panel Report, Japan – Countervailing Duties on Dynami c Random Access Memories from Korea  
("Japan – DRAMs (Korea) "), WT/DS336/R, adopted 17 December 2007, as modified by Appellate Body Report, 
WT/DS336/AB/R, para. 7.9.   WT/DS350/R 
Page 34  
 
  issue in that dispute concerned the meaning of a specific term that was used in the complaining 
Member's panel request.  The Appellate Body noted  that this term had a generic meaning in the 
relevant industry and that it had been used in the consultations between the parties prior to the filing 
of the complaining Member's panel request.  On that basis, the Appellate Body concluded that 
because the defendant's right to defend itself had not b een prejudiced by the alleged lack of clarity in 
the text of the panel request, the fundamen tal due process right had not been violated.
80 
7.65 In our view, the Appellate Body's reasoning in Korea – Dairy  also related to the particular 
circumstances of that dispute.  In that dispute,  the Appellate Body addressed the issue of whether or 
not mere citation in a panel request of the releva nt treaty articles would meet the requirements of 
Article 6.2 of the DSU, and reasoned that this i ssue should be assessed on a case by case basis.  In 
resolving that issue in that particular dispute, the Appellate Body inquired whether the defendant's 
right to defend itself had been prejudiced by the me re citation of the relevant treaty articles in the 
complaining Member's panel request.81 
7.66 We do not read the Appellate Body's reasoning in  these two disputes to mean that Article 6.2 
of the DSU contains a prejudice requirement.  As fa r as the preliminary ruling made by the panel in 
Canada – Wheat Exports and Grain Imports  is concerned, we note that the issue in that case was the 
kind of information that the complaining Member's pa nel request has to contain "in the absence of an 
explicit identification of a measure of general application by name".82  We do not see anything in that 
ruling which would suggest that Articl e 6.2 should be interpreted as cont aining a prejudice requirement.   
7.67 We therefore do not agree with the EC's argument that the United States has to demonstrate that 
the flaw in the EC's panel request has prejudiced it s right to defend itself in these proceedings.   
3. Inclusion of Ongoing Proceedings in the European Communities' Panel Request 
(a) Arguments of the Parties 
(i) United States 
7.68 The United States points out that four of the measures identified in the EC's panel request 
were preliminary results of periodic or sunset reviews.  Such preliminary results, in the US view, do 
not constitute "final action" within the meaning of  Article 17.4 of the Anti-Dumping Agreement.  The 
United States notes that Article 17.4 allows the initiation of dispute settlement proceedings with 
regard to provisional measures if certain criteria ar e met, and asserts that the European Communities 
has not shown that these criteria have been met in this case.  The United States therefore requests the 
Panel to decide that these four preliminary determin ations do not fall within its terms of reference. 
(ii) European Communities 
7.69 The European Communities acknowledges that four  of the measures identified in its panel 
request, i.e., three preliminary sunset determinations a nd one preliminary determination in a periodic 
review, did not constitute final measures.  Th e European Communities contends, however, that, 
                                                      
80 Appellate Body Report, European Communities – Customs Classification of Certain Computer 
Equipment ("EC – Computer Equipment "), WT/DS62/AB/R, WT/DS67/AB/R, WT/DS68/AB/R, adopted 
22 June 1998, DSR 1998:V, 1851, para. 70.   
81 Appellate Body Report, Korea – Definitive Safeguard Measure on Imports of Certain Dairy Products 
("Korea – Dairy "), WT/DS98/AB/R, adopted 12 January 2000, DSR 2000:I, 3, para. 127. 
82 Panel Report, Canada – Measures Relating to Exports of Wheat and Treatment of Imported Grain 
("Canada – Wheat Exports and Grain Imports "), WT/DS276/R, adopted 27 September 2004, upheld by Appellate 
Body Report, WT/DS276/AB/R, DSR 2004:VI, 2817, para. 6.10.  WT/DS350/R 
 Page 35 
 
 
  whether preliminary or definitive, any measure adopt ed subsequent to the specific measures identified 
in the EC's panel request, falls with in the Panel's terms of reference. 
(b) Evaluation by the Panel 
7.70 It is factually uncontested that four of the 52 measures identified in the EC's panel request 
were preliminary determinations made by the USDOC.  These include three preliminary results of 
sunset reviews and one preliminary result of  a periodic review.  These four preliminary 
determinations are: 
Type of Proceeding Product and Country Relevant 
Exhibits 
Sunset review Steel concrete reinforcing bars from Latvia  
A-449-804 
 EC-70 
Periodic review Certain hot rolled carbon steel flat products from the 
Netherlands   
A-421-807 (Period of Review:  1 November 2004 - 31 October 2005) EC-59 
Sunset review Certain hot rolled carbon steel flat products from the 
Netherlands A-421-807 
 EC-77 
Sunset review Certain Pasta from Italy   
A-475-818 
  
EC-78 
 7.71 The United States contends that the four preliminary determinations at issue are outside the 
Panel's terms of reference because they do not constitute final action within the meaning of 
Article 17.4 of the Anti-Dumping Agreement.  Th e United States recalls the two conditions set out 
under Article 17.4 of the Agreemen t which have to be met in pr oceedings challenging preliminary 
determinations and argues that none  of them were met by the Euro pean Communities with regard to 
the four preliminary determinations at issue.  Th at is, the United States contends that the European 
Communities did not raise a claim against the pre liminary determinations under Article 7.1 of the 
Agreement nor demonstrate a significan t impact of those determinations.
83 
7.72 Article 17.4 of the Anti-Dumping Agreement provides:   
"If the Member that requested consultations  considers that the consultations pursuant 
to paragraph 3 have failed to  achieve a mutually agreed solution, and if final action 
has been taken by the administering authorities of the importing Member to levy 
definitive anti-dumping duties or to accept price undertakings, it may refer the matter 
to the Dispute Settlement Body ("DSB").   When a provisional measure has a 
significant impact and the Member that requested consultations considers that the 
measure was taken contrary to the pr ovisions of paragraph 1 of Article 7 , that 
Member may also refer such matter to the DSB." (emphasis added) 
7.73 Article 17.4 generally stipulates that a Memb er may challenge definitive measures imposed 
by other Members.  It states that exceptionally a provisional anti-dumping me asure may be challenged 
if it has a significant impact and if the complaining Member shows that the provisional measure was 
                                                      
83 First Written Submission of the United States, footnote 69. WT/DS350/R 
Page 36  
 
  taken inconsistently with the provisions of Article 7. 1 of the Agreement.  Article 7.1 lays down three 
conditions for the imposition of a provisional anti-dumping measure.
84  Thus, the EC's claim 
regarding the four preliminary measures at issu e may be accepted only if the European Communities 
proves that the conditions set out under Article 7.1 of the Agreement have not been met with regard to 
such measures.  Although the European Communities generally argues that "the preliminary 
determinations carried out by the USDOC have an  impact on the final duty level which may result 
from the latest proceeding"85, it does not raise any claim under Article 7.1 in these proceedings.  This 
indicates that the EC's claims regarding the four preliminary measures at issue are not within the 
Panel's terms of reference.   
7.74 The European Communities cites the panel report in Mexico – Corn Syrup  in support of its 
argument.  We note, however, that the only claim rega rding provisional measures in that case related to 
an alleged violation of Article 7.4 of the Agreement that sets the ma ximum duration of such measures.  
In other words, there was no allegation in Mexico – Corn Syrup  regarding a violation of Article 7.1.86  
The panel in Mexico – Corn Syrup  was of the view that "a claim regarding the duration of a provisional 
measure relates to the definitive anti-dumping duty".87  This explains why the panel did not expect the 
complaining Member in that case  to demonstrate the existence of  the two conditions set out under 
Article 17.4 for challenging a provisional anti -dumping measure.  Thus, the panel report in Mexico – 
Corn Syrup  does not support the EC's position in this dispute.   
7.75 In response to questioning, the European Co mmunities contends that it is not challenging 
provisional measures within the meaning of Article 17 .4 of the Anti-Dumping Agreement in this case.  
The EC's panel request describes the measure at is sue as the continued application of anti-dumping 
duties resulting from the anti-dumping orders anne xed to its panel request "as calculated or 
maintained in place pursuant to the mo st recent [anti-dumping proceedings]".88  I n t he  v i e w  of  t he  
European Communities, this description "compr ises any subsequent measure adopted by the 
[United States], including preliminary determinati ons setting out the duty levels (wrongly calculated 
by applying zeroing) and insofar as those duties are still in place".89  The European Communities 
contends that the Panel should take into consideration the speci fic circumstances of this dispute in 
resolving this issue.  According to the European  Communities, such specific circumstances include 
the nature of the zeroing methodology and the fact that the United States refuses to implement the 
DSB recommendations and rulings pertaining to past zeroing disputes.90   
7.76 We note that the EC's response is internal ly inconsistent.  On the one hand, the 
European Communities argues that the four prel iminary measures have to  be considered as 
"subsequent measures" to the general description of the measure in its panel request and therefore fall 
                                                      
84 Article 7.1 of the Agreement provides: 
"Provisional measures may be applied only if: 
(i) an investigation has been initiated in accordan ce with the provisions of  Article 5, a public 
notice has been given to that effect and interested parties have been given adequate 
opportunities to submit information and make comments; 
(ii) a preliminary affirmative determination has been made of dumping and consequent injury to a domestic industry;  and 
(iii) the authorities concerned j udge such measures necessary to  prevent injury being caused 
during the investigation." 
85 Response of the European Communities to the US Request for Preliminary Rulings, para. 54. 
86 Panel Report, Mexico – Anti-Dumping Investigation of High Fructose Corn Syrup (HFCS) from the 
United States ("Mexico – Corn Syrup "), WT/DS132/R and Corr.1, adopted 24 February 2000, DSR 2000:III, 1345, 
para. 7.48. 
87 Ibid., para. 7.53. 
88 Response of the European Communities to Question 6 from the Panel Following the First Meeting.   
89 Ibid. 
90 Ibid.   WT/DS350/R 
 Page 37 
 
 
  within the terms of reference of the Panel.  On th e other hand, it contends that this dispute presents 
special circumstances with regard to the identification of the specifi c measures at issue and invites the 
Panel to take into consider ation such circumstances. 
7.77 Both arguments offered by the European Communiti es in this regard lack a legal basis in the 
Agreement.  We are also of the view that the a lleged special circumstances of this dispute cannot 
override the plain text of Article 17.4 which subj ects the claims against provisional measures to 
certain conditions.  We therefore conclude that the EC's claims regarding the four preliminary 
measures at issue are outside our terms of reference in these proceedings.   
D. CONTINUED APPLICATION OF 18 ANTI -DUMPING DUTIES  
1. Arguments of the Parties 
(a) European Communities 
7.78 The European Communities does not challenge the practice of zeroing "as such" because it 
argues that zeroing as such has already b een condemned in previous cases.  The 
European Communities challenges the continued application of the 18 duties stemming from the 
18 cases listed in the annex to its panel request.  Ac cording to the European Communities, in addition 
to the alleged WTO-inconsistency of applying zeroing in the calculation of dumping margins in 
various proceedings pertaining to these 18 cases, the continued application of the duties resulting from 
such proceedings itself constitutes a measure.  Th e European Communities contends that these duties 
are applied at rates that exceed th e real margins that would have been obtained without zeroing.  The 
European Communities asserts that the continued a pplication of these 18 duties is inconsistent with 
Articles 2.4, 2.4.2, 9.3, 11.1, 11.3 of the Anti-Dumping Agreement and Articles VI:1 and VI:2 of the 
GATT 1994 because they reflect margins obtained through zeroing.  The European Communities 
argues that for the same reasons that zeroing in the context of investigations, periodic reviews and 
sunset reviews is inconsistent with Articles 2.4, 2. 4.2, 9.3, 11.1, 11.3 of the Anti-Dumping Agreement 
and Articles VI:1 and VI:2 of the GATT 1994, the continued application of the duties resulting from 
the application of zeroing is inconsis tent with the same provisions.   
7.79 The European Communities also argues that th e continued application of these 18 duties is 
inconsistent with Article XVI:4 of the WTO Agreemen t.  The EC's argumentation in this regard is 
two-fold.  First, the European Communities submits that because th e continued application of the 
18 duties at issue violates Articles 2.4, 2.4.2, 9.3, 11.1, 11.3 of the Anti-Dumping Agreement and Articles VI:1 and VI:2 of the GATT 1994, it also violates Article XVI:4 of the WTO Agreement.  
This, according to the European Communities, indicates that the Un ited States failed to ensure the 
consistency of its laws, regulati ons and administrative procedures with its WTO obligations.  Second, 
the European Communities contends that by continui ng to apply model and simple zeroing procedures 
– which are administrative procedures within the m eaning of Article XVI:4 of the WTO Agreement – 
in proceedings initiated after the date of adoption of the first Appellate Body report finding zeroing to 
be WTO-inconsistent, the United States has violat ed its obligation under Article XVI:4 of the WTO 
Agreement. 
(b) United States 
7.80 The United States argues that the EC's clai m under Article XVI:4 of the WTO Agreement 
depends on a finding of inconsis tency in connection with the other claims that the European 
Communities raises.  It suggests that since the Un ited States has not acted inconsistently with the 
other WTO obligations cited by the European Co mmunities, the Panel must find no violation of 
Article XVI:4 of the WTO Agreement.  The United St ates also counters the EC's argument that the 
United States is in violation of Article XVI:4 of  the WTO Agreement because it continues to apply WT/DS350/R 
Page 38  
 
  measures that have been found to be WTO-incons istent by the WTO Appellate Body in some past 
disputes.  In this regard, the United States reca lls the Appellate Body's own pronouncement that 
Appellate Body and panel reports ar e only binding with respect to th e resolution of the disputes that 
they concern.
91  In the view of the United States, th e approach advocated by the European 
Communities would make Appellate Body and panel reports binding on all Members, a result that 
would have no basis in legal texts.  The Unite d States has not submitted arguments regarding the 
claims that the European Communitie s raised under Articles 2.4, 2.4.2, 9.3, 11.1, 11.3 of the Anti-
Dumping Agreement and Articles VI:1 and VI :2 of the GATT 1994 concerning the continued 
application of the 18 duties. 
2. Arguments of Third Parties 
(a) Japan 
7.81 Japan notes that under US law, anti-dumping orde rs provide the legal basis for the imposition 
of anti-dumping duties following an investigation.  The amounts of the duty may subsequently change 
depending on different types of reviews.  Japan argues that pursuant to Article 6.2 of the DSU, such an order constitutes a measure susceptible to a chal lenge in WTO dispute settlement.  Similarly, it 
constitutes "final action" within the meaning of Article 17.4 of the Anti-Dumping Agreement.   
3. Evaluation by the Panel 
7.82 We note that, except for the claim under Ar ticle XVI:4 of the WTO Agreement, the 
substantive legal basis of the EC's claims regardi ng the continued application of the 18 duties at issue 
does not differ from its claims with regard to th e 52 measures imposed in investigations, periodic 
reviews or maintained following sunset reviews.   In response to questioning, the European 
Communities argues that the Panel should refrain from  applying judicial economy with regard to the 
claims in connection with the continued applicati on of the 18 duties.  Applying judicial economy with 
regard to the EC's claims concer ning the continued application of the 18 duties at issue would, in the 
EC's view, constitute false judicial economy.
92  On the other hand, the European Communities states 
that if the Panel finds for the European Communi ties with regard to its claims concerning the 
continued application of the 18 duties, it may apply judicial economy with regard to the EC's claims 
regarding the use of zeroing in the 52 specific proceedings.   
7.83 We recall our finding above (para. 7.61) that the EC's claims in connection with the continued 
application of the 18 duties at issue do not fall within  our terms of reference in these proceedings.  We 
therefore decline to address such claims.   
E. ZEROING IN INVESTIGATIONS  
1. Arguments of the Parties 
(a) European Communities 
7.84 The European Communities challenges the use of zeroing in four investigations.  The 
European Communities develops its arguments on the basis of the specifics of one of these 
investigations, Purified Carboxymethylcellulose from the Netherlands , but argues that the same 
arguments also apply to the other three investiga tions.  The European Communities argues that in the 
dumping calculations in the mentioned investigation, the USDOC used a methodology which the European Communities refers to as "model zeroing".  Under this methodology, the USDOC 
                                                     
 
91 First Written Submission of the United States, para. 159. 
92 Response of the European Communities to Question 2 from the Panel Following the First Meeting.    WT/DS350/R 
 Page 39 
 
 
  categorized the subject product into models, and made calculations for each model through the WA-
WA method.  In the aggregation of such model- specific calculations, however, the USDOC ignored 
the results where the WA export price exceeded th e WA normal value.  This, in the EC's view, 
inflated the margin of dumping for the product unde r consideration as a whole.  According to the 
European Communities, the 14.88 per cent marg in of dumping calculated by the USDOC, in Purified 
Carboxymethylcellulose from the Netherlands , would have been 12.15 per cent without model 
zeroing. 
7.85 The European Communities submits that the USDO C acted inconsistently with Article 2.4.2 
of the Agreement by using model zeroing in the f our investigations at issue.  According to the 
European Communities, the definition of dumpi ng found in Article 2.1 of the Agreement and 
Article VI:1 of the GATT 1994 applies to the product under consideration as a whole, and not to a 
type, model or category of that product.  Article 2.4.2 also requires dumping determinations to be 
made with regard to the produc t under consideration as a whole.  Investigating authorities may 
categorize the product into models in the process of calculating the margin of dumping for the product 
under consideration as a whole.  Such model-spec ific calculations, however, are not margins of 
dumping, but results that have to be used in the calculation of the margin of dumping for the product 
under consideration as a whole.  The authorities, theref ore, must take into consideration the results of 
all model-specific calculations in the calculation of the margin of dumping for the product under 
consideration as a whole.  The USDOC acted in consistently with the obligation set out under 
Article 2.4.2 of the Agreement by excluding the re sults of model-specific comparisons where the WA 
export price exceeded the WA normal value.   
7.86 The European Communities also contends that model zeroing used by the USDOC in the four 
investigations at issue is inconsistent with Artic le 2.4 of the Agreement.  The European Communities 
asserts that the requirement to carry out a fair comparison between the normal value and the export 
price pursuant to Article 2.4 constitutes an indepe ndent and overarching obligation.  That is, the 
general obligation laid down in the first sentence of Article 2.4 is independent from the more specific 
obligations found elsewhere in that article.  Thus, th e obligation to make a fair comparison applies not 
only to price comparability but also to subparagraphs 2.4.1 and 2.4.2.  According to the European Communities, model zeroing is inherently biased and unfair because it inflates the margin 
of dumping.  As a methodological choice that system atically favours the interests of petitioners and 
prejudices the interests of exporters, model zeroing cannot be considered as allowing a fair comparison within the meaning of Article 2.4. 
7.87 The European Communities also contends th at the use of model zeroing in the four 
investigations at issue conflicted with the obliga tions set out under Articles VI:1 and VI:2 of the 
GATT 1994. 
(b) United States 
7.88 The United States acknowledges that the USDOC applied model zeroing in the four anti-
dumping investigations at issue.  The United States also recognizes that in US – Softwood Lumber V , 
the Appellate Body found the use of this type of zero ing to be inconsistent with Article 2.4.2 of the 
Agreement and that this reasoning is equally applicable  to the EC's claim in these proceedings.  The US 
acknowledgement, however, is limited to the EC's claim under Article 2.4.2 of the Agreement.  The 
United States rejects other claims that the Eu ropean Communities raises regarding zeroing in 
investigations.  Specifically, the United States contes ts the EC's claims under Ar ticles 2.1 and 2.4 of the 
Agreement because these are definitional provisions which do not impose independent obligations.  The WT/DS350/R 
Page 40  
 
  United States assert s that a finding under Article 2.4.2 would suff ice to resolve the EC's claim regarding 
the four investigations at issue.
93   
2. Arguments of Third Parties 
(a) India 
7.89 India notes that despite past panel and Appellate Body rulings that found zeroing to be 
inconsistent with Articles 2.4.2, 9.3, 11.2 and 11.3 of the Agreement, the United States continues to 
use this methodology in the calculation of dumping margins, with the exception of investigations 
where the WA-WA method is used.  In India's vi ew, zeroing inflates dumping margins, leads to a 
positive finding of dumping in cases where there would have been no dumping absent zeroing and 
taints the investigating authorities' evaluation of  the impact of dumped imports.  India therefore 
requests the Panel to reiterate the conclusion that th e use of zeroing in connection with all comparison 
methodologies and all anti-dumping proc eedings is WTO-inconsistent.   
(b) Japan 
7.90 Japan bases its arguments regarding the use of  zeroing in investigations on the Appellate 
Body reports in the past zeroing disputes.  Japan contends that Article 2.1 and the first sentence of 
Article 2.4.2 of the Agreement require investigati ng authorities to calculate dumping with respect to 
the product under consideration as a whole.  The zeroing methodology applied by the USDOC in investigations fail to meet this requirement becau se in the aggregation of model-specific calculations 
it ignores the intermediate results where the export price exceeds th e normal value.  According to 
Japan, the comparison results pertaining to mode ls of the product under consideration do not 
constitute margins of dumping.  They are merely interm ediate results that have to be aggregated in the 
calculation of the margin of dumping for the product under consideration as a whole.  Hence, the 
USDOC's use of zeroing in investigations is inconsis tent with the obligations set forth in Articles 2.1 
and 2.4.2 of the Agreement.   
7.91 Japan submits that the zeroing methodology that the USDOC uses in investigations inflates 
the margin of dumping by ignoring intermediate results where the export price exceeds the normal 
value.  Hence it does not provide for an impartial,  even-handed and unbiased dumping determination.  
It follows that the USDOC's dumping determinations in  investigations are inconsistent with the fair 
comparison obligation found under Article 2.4 of the Agreement.   
(c) Korea 
7.92 Korea notes that the Appellate Body has found zeroing to be WTO-inconsistent in all anti-
dumping proceedings and invites the Panel to reiterate  this general finding.  More specifically, Korea 
recalls that the Appellate Body has found the use of zeroing in investigations where the normal value 
and the export price are compared on a WA-WA basis to  be inconsistent with Articles 2.4.2 and 2.4 of 
the Agreement.  Korea invites the Panel to also find that the use of zeroing in investigations where the 
normal value and the export price are compared on a WA-WA basis is inconsistent with Articles 2.4.2 
and 2.4 of the Agreement.   
(d) Norway 
7.93 Norway recalls that in the previous zeroing cases, the Appellate Body found zeroing to be 
inconsistent with the requirements of the An ti-Dumping Agreement.  Although the doctrine of stare 
decisis  does not apply in WTO dispute settlement, Norway argues that in the interest of certainty, 
                                                     
 
93 First Written Submission of the United States, paras. 155-156.    WT/DS350/R 
 Page 41 
 
 
  foreseeability and equality before the law, panels  and the Appellate Body should not depart from 
precedents without showing good reason.  Norway submits that adopted reports create legitimate 
expectations among WTO Members and should therefor e be followed by panels to the extent the 
issues are similar.  Norway argues that this case do es not present factual or legal arguments different 
from those in the past zeroing cases.  The Panel sh ould therefore not depart from the precedents in 
making its findings and recommendations.   
7.94 Furthermore, Norway contends that adopted panel and Appellate Body  reports affect the 
WTO Members' obligations within the meaning of Article XVI:4 of the WTO Agreement.  According 
to Norway, although the DSB recommendations and ruli ngs in a given case only affect parties to that 
dispute, such rulings and recommendations also expl ain the obligations of all Members in general.  
Hence, according to Norway, WTO Members have to take into consider ation adopted panel and 
Appellate Body reports in adopting or main taining their domestic laws and regulations.94   
7.95 Norway notes the Appellate Body's findings regarding zeroing and considers that the 
prohibition in this regard is not limited to i nvestigations and to the WA-WA methodology.  In 
Norway's view, zeroing is prohibited in all anti -dumping proceedings and with regard to all 
comparison methodologies because:  a) Article 2.1 requires dumping determinations to be made for 
the product under consideration as a whole and b) zeroing is contrary to the fair comparison 
requirement under Article 2.4.   
7.96 With regard to WTO panels' task as treaty in terpreters, Norway argues that the purpose of 
treaty interpretation is to reach "the one and only interpre tation of a term".95  According to Norway, 
panels in US – Stainless Steel (Mexico)  and US – Zeroing (Japan)  committed certain legal errors in 
their interpretation of the relevant treaty provisions.  First, they did not base their interpretation of the 
terms "product" and "margin of dumping" on the relevant treaty provisions, as required by the 
principles laid down in Articles 31 and 32 of the Vie nna Convention.  Instead, they came up with their 
own interpretation, which they then considered as a permissible interpretation within the meaning of 
Article 17.6(ii) of the Anti-Dumping Agreement.  Second, these panels resorted to Article 17.6(ii) 
without first exhausting all possible means in order to achieve one possible interpretation for the legal 
provisions before them.  Norway invites this Pane l not to commit the same errors and to follow the 
persuasive reasoning of the Appellate Body that has found zeroing to be inconsistent in all anti-
dumping proceedings and in connection with a ll types of comparison methodologies.   
(e) The Separate Customs Territory of  Taiwan, Penghu, Kinmen and Matsu 
7.97 The Separate Customs Territory of Taiwan , Penghu, Kinmen and Matsu ("TPKM") argues 
that the definition of dumping under Article 2.1 of the Agreement applies to all anti-dumping 
proceedings, including duty assessment proceedings.  The TPKM therefore asserts that the dumping 
determinations in such proceedings should also c onform with the disciplines set forth under Article 2, 
including subparagraphs 2.4 and 2.4.2 thereof.   
7.98 According to the TPKM, dumping has to be est ablished with respect to the product under 
consideration as a whole.  It follows that any cal culation that omits some export transactions will be 
inconsistent with the Anti-Dumping Agreement.  The TPKM contends that the term "investigation" 
under Article 2.4.2 does not relate solely to origin al investigations conducte d under Article 5 of the 
Agreement.  This expression does not have the same  meaning in all instances where it appears in the 
Agreement.  The TPKM argues that the term "investig ation", as used under Article 2.4.2, refers to the 
investigative activity undertaken in all kinds of anti-dumping proceedings.  According to the TPKM, 
                                                      
94 Written Submission of Norway, para. 18.   
95 Oral Statement of Norway, para. 14.   WT/DS350/R 
Page 42  
 
  the object and purpose of Article 2 would be undermined  if Articles 2.4 and 2.4.2 were interpreted as 
being applicable to original  investigations only.   
7.99 The TPKM asserts that Article 2.4 of the Agreemen t contains an obligation to carry out a fair 
comparison between the normal value and the export price by taking into account the prices of all sales pertaining to the product under consideration.   The authorities cannot disregard some of these 
transactions.  The omission of certain export pri ces amounts to overcorrecting the injury caused by 
dumping and goes beyond the limits of the permissi on for resorting to anti-dumping measures.  This 
obligation applies to all types of anti-dumping proceedings.   
7.100  The TPKM concludes that the US application of the zeroing methodology in all anti-dumping 
proceedings under its law, including re views, is inconsistent with Artic les 2.1, 2.4, 2.4.2, 9.3, 11.1, 
11.2 and 11.3 of the Anti-Dumping Agreement, as well as Articles VI:1 and VI:2 of the GATT 1994.  
The TPKM invites the Panel to follow the Appellate  Body's jurisprudence and find zeroing to be 
WTO-inconsistent in all anti-dumping proceedings a nd in connection with all types of comparison 
methodologies.   
(f) Thailand 
7.101  Thailand submits that zeroing is inconsistent w ith both the letter and the spirit of the Anti-
Dumping Agreement and Article VI of the GATT 1994.   Zeroing either gives rise to a finding of 
dumping in cases where there is no dumping, or inflates the true margin of dumping.  Thailand generally agrees with the European Communities with regard to the clai ms raised in this dispute.  
Thailand contends that this Panel should follow the reasoning of the Appellate Body enunciated in the 
past zeroing cases and find the measures at issu e to be inconsistent with the Anti-Dumping 
Agreement.  Otherwise, argues Thailand, the securi ty and predictability that the dispute settlement 
mechanism is to provide to the multilateral trad ing system would be undermined.  There is, in 
Thailand's view, no counterargument presented in th is case that would justify a departure from the 
Appellate Body's jurisprudence on zeroing.   
7.102  Thailand also disagrees with the US view that dumping may be determined with regard to a 
specific import transaction.  Nor does Thailand agree with the proposition that the payment of the 
duty in a prospective normal value system constitu tes final liability.  Thailand argues that the 
calculation of the amount of the duty to be paid by an importer in the context of a prospective normal value system does not entail a calculation of a margin of dumping.  It would therefore be illogical to 
compare the determination made in a duty assessmen t proceeding with the calculation of the duty to 
be paid in a prospective normal value system.   
3. Evaluation by the Panel 
7.103  The four investigations at issue are the following:   
 
Product and Country Involved Relevant Exhibits 
Purified carboxymethylcellulose from Sweden 
USDOC Case No:  A-401-808 EC-28 
Purified carboxymethylcellulose from the 
Netherlands USDOC Case No:  A-421-811 EC-26 
Purified carboxymethylcellulose from Finland 
USDOC Case No:  A-405-803 EC-29 
Chlorinated Isocyanurates from Spain 
USDOC Case No:  A-469-814 EC-30  WT/DS350/R 
 Page 43 
 
 
   
7.104  The United States concedes that the USDOC a pplied model zeroing in these investigations.  
Furthermore, the United States acknowledges th at the reasoning of the Appellate Body in US – 
Softwood Lumber V , which found model zeroing in investigations to be inconsistent with Article 2.4.2 of 
the Agreement, applies to the EC's claim at issue.96  The United States has not submitted any argument 
to counter the EC's proposition that model zeroing is inconsistent with  Article 2.4.2 of the Agreement. 
7.105  Given the US acknowledgement that  the Appellate Body's reasoning US – Softwood Lumber V  
regarding the WTO-compatibility with Article 2.4.2 of the Agreement of model zeroing in 
investigations is equally applicable with regard to the contested investigations in these proceedings, the 
issue of burden of proof becomes particularly important  with regard to the assessment of the claim at 
issue.  We recall that pursuant to the principles governing the burden of proof which we follow in these 
proceedings ( supra , para. 7.6), it is for the complaining Member to make a prima facie case with regard 
to a claim that it asserts, before th e burden shifts to the defendant to rebut such case.  The United States 
does not contest the EC's cl aim under Article 2.4. 2 against model zeroing in i nvestigations.  In our view, 
however, the US acknowledgement does not discharge  the European Communities from its obligation 
to present a prima facie case regarding the alleged inconsistency with Article 2.4.2 of the Agreement 
of model zeroing in investigations.97  Regardless of the US acknowledgement, therefore, we have to 
assess whether the EC's arguments are sufficient to make a prima facie case.  It is only then that we 
can find that the United States acted inconsistently  with its WTO obligations.  In our view, our 
obligation to carry out an "objective assessment of the facts of the case and the applicability of and 
conformity with the relevant c overed agreements" as set forth in Article 11 of the DSU lends support 
to the approach that we are taking in this regard.  With this in mind, we now proceed to assess the 
claim presented by the Eu ropean Communities.   
7.106  The European Communities argues that model zeroi ng in investigations is  inconsistent with 
the obligation set forth under 2.4.2 of the Agreemen t because it precludes the investigating authorities 
from making a determination of dumping for the produc t under consideration as a whole.  This occurs 
through the exclusion, from the ultimate calcula tion made for the product under consideration as a 
whole, of the results of model-specific comparis ons where the WA export price exceeded the WA 
normal value.  The European Co mmunities also asserts that model zeroing in investigations is 
inconsistent with Article 2.4 of the Agreement be cause it represents a methodology that is inherently 
biased and unfair.  Finally, the European Communiti es contends that model zeroing in investigations 
contradicts the obligations set forth under Articles VI:1 and VI:2 of the GATT 1994.   
7.107  We consider it appropriate to commence our analysis with the alleged violation of 
Article 2.4.2 of the Agreement and then move on to  the other allegations to the extent necessary to 
resolve the dispute.  Article 2.4.2 provides:   
                                                      
96 First Written Submission of the United States, paras. 155-156.   
97 We note that this very issue arose in the last tw o zeroing disputes and the panels reasoned that the 
defendant's acknowledgement regarding the WTO-inconsistency of the measure at issue did not discharge the complaining Member from its obligation to make a prima facie case.  See, Panel Report, United States – Anti-
Dumping Measures on Shrimp from Ecuador ("US – Shrimp (Ecuador) "), WT/DS335/R, adopted 
20 February 2007, para. 7.9;  Panel Report, United States – Final Anti-Dumping Measures on Stainless Steel 
from Mexico ("US –Stainless Steel (Mexico) "), WT/DS344/R, adopted 20 May 2008, as modified by Appellate 
Body Report, WT/DS344/AB/R, para. 7.52. WT/DS350/R 
Page 44  
 
  "Article 2 
Determination of Dumping 
... 
2.4.2 Subject to the provisions governing fair comparison in paragraph 4, the 
existence of margins of dumping during the investigation phase shall normally be 
established on the basis of a comparison of  a weighted average normal value with a 
weighted average of prices of all comparable export transactions
 or by a comparison 
of normal value and export prices on a transaction-to-transaction basis.  A normal value established on a weighted average basis may be compared to prices of 
individual export transactions if the author ities find a pattern of export prices which 
differ significantly among different purchasers, regions or time periods, and if an 
explanation is provided as to why such  differences cannot be taken into account 
appropriately by the use of a weighted av erage-to-weighted average or transaction-to-
transaction comparison."  (emphasis added) 
7.108  Article 2.4.2 permits the use of three differe nt methodologies for dumping determinations in 
anti-dumping investigations.  The first two, i.e., the WA-WA and the transaction-to-transaction 
methodologies, are set out in the first sentence and the third, i.e., the WA-T methodology, in the 
second sentence.  The claim at issue concerns the use of th e WA-WA methodology.  The first 
sentence of Article 2.4.2 provides that in inves tigations where dumping determinations are based on 
the WA-WA methodology, the WA normal value has to be compared with the WA of prices of "all 
comparable export transactions".  This, in our vi ew, suggests that the authorities cannot exclude from 
their calculations any export transaction made duri ng the relevant period of investigation.  The 
European Communities articulates its  claim under Article 2.4.2 in pa rallel to the reasoning of the 
Appellate Body in the past zeroing cases, including US – Softwood Lumber V .  We recall the US 
acknowledgement that the Appellate Body's reasoning in US – Softwood Lumber V  is equally applicable 
to the EC's claim under Article 2.4.2 in these proceedings.   
7.109  In US – Softwood Lumber V , the Appellate Body started out by clarifying that Article 2.4.2 
permits multiple averaging.
98  This means that the investigating authorities may categorize the subject 
product under different models, carry out a compar ison on the basis of a WA normal value and a WA 
export price for each such model, and then aggregat e such model-specific results in the calculation of 
the margin of dumping for the product under consider ation as a whole.  The Appellate Body opined 
that where the WA-WA methodology is used, Articl e 2.4.2 requires the investigating authorities to 
take into consideration the average of pr ices of all comparable export transactions.99  The Appellate 
Body then moved on to the issue of whether this obligation was limited to model-specific 
comparisons or whether it also applied to the aggregation of such comparisons.  In the view of the Appellate Body, this hinged upon the interpreta tion of the terms "dumping" and "margins of 
dumping" in the Anti-Dumping Agreement.
100  According to the Appellate Body, the definition of the 
term "dumping" under Article 2.1 refers to the product under consideration as a whole as defined by 
the investigating authorities in the relevant investig ation.  Furthermore, the phrase "[f]or the purpose 
of this Agreement" in Article 2.1 indicates that th is definition of dumping applies throughout the Anti-
Dumping Agreement, including in the context of Ar ticle 2.4.2.  Thus, the Appellate Body came to the 
                                                      
98 Appellate Body Report, United States – Final Dumping Determination on Softwood Lumber from 
Canada ("US – Softwood Lumber V "), WT/DS264/AB/R, adopted 31 August 2004, DSR 2004:V, 1875, para. 81.   
99 Ibid., para. 86.   
100 Ibid., para. 90.    WT/DS350/R 
 Page 45 
 
 
  conclusion that dumping can be found to exist only "for the product under investigation as a whole, 
and cannot be found to exist for a product ty pe, model, or category of that product".101   
7.110  The Appellate Body expressed the view that th e obligation set forth under Article 2.4.2, to 
take into account the weighted average of prices of all comparable export transactions, applies not 
only to the model-specific comparisons, but also to  their aggregation for purposes of establishing the 
margin of dumping for the product under consideration as a whole.102  According to the Appellate 
Body, the results of model-specific comparisons ar e not margins of dumping within the meaning of 
Article 2.4.2, but rather constitute intermediate calcula tions that need to be taken into consideration in 
the calculation of the margin of dumping for the product under consideration as a whole.103  
Consequently, when authorities use multiple aver aging in their dumping determinations in 
investigations, Article 2.4.2 requires the inclusion of  all model-specific comparisons in the calculation 
of the margin of dumping for the product under consideration as a whole.   
7.111  We agree with the Appellate Body's view that the phrase "all comparable export transactions" 
in Article 2.4.2 requires the authorities to take into consideration the WA of the prices of all 
comparable export transactions in the calculation of dumping margins in investigations where the 
WA-WA methodology is used.  Mode l zeroing conflicts with this obligation because it excludes from 
the calculation of the margin of dumping for the pr oduct under consideration as a whole the results of 
model-specific comparisons where the WA export price exceeds the WA normal value.  Thus, we find that model zeroing is inconsistent with the obligatio n set out under Article 2.4.2 of the Agreement.  It 
follows that the United States acted inconsistently with the obligation set out under Article 2.4.2 by 
using model zeroing in the four investigations at issue.
104 
7.112  Having found model zeroing in investigations to be inconsistent with the obligation set out 
under Article 2.4.2 of the Agreement, we need  not, and do not, address the EC's claims under 
Article 2.4 of the Anti-Dumping Agreement and Articles VI:1 and VI:2 of the GATT 1994.   
F. ZEROING IN PERIODIC REVIEWS  
1. Arguments of the Parties 
(a) European Communities 
7.113  The European Communities argu es that the USDOC applied wh at the European Communities 
calls "simple zeroing" in 37 periodic reviews liste d in the annex to the EC's panel request.  The 
European Communities develops its arguments in this  regard on the basis of the specifics of one of 
these periodic reviews, Ball Bearings from Italy , and points out that the same arguments also apply 
with regard to the remaining periodic reviews.  In the periodic review at issue, the USDOC calculated 
assessment rates for the entries made during the period of review and the new cash deposit rate for 
future entries.  In so doing, the USDOC used th e WA-T methodology.  Hence, the USDOC started its 
dumping calculations by making various comparis ons between a WA norma l value and individual 
export transactions.  The results of these comparisons  were then aggregated in order to obtain the 
overall WA dumping margin.  In this aggregation,  the USDOC ignored the results of comparisons 
where the export price exceeded the WA norma l value.  This, in the view of the 
European Communities, inflated the overall marg in of dumping.  In the periodic review of Ball 
                                                      
101 Ibid., para. 96.   
102 Ibid. , para. 98.  
103 Ibid., para. 97.   
104 We would like to note that the views of the majority of the Panel regarding the Appellate Body's 
interpretation on the issue of "the product under consideration as a whole" are subject to the comments found in 
paras. 7.162-7.169 below. WT/DS350/R 
Page 46  
 
  Bearing from Italy , for instance, both margins calculated for the two respondents, 2.52 and 7.65 per 
cent, would have been negative had the USDOC not applied simple zeroing.   
7.114  The European Communities submits that by usin g simple zeroing in the 37 periodic reviews 
at issue, the USDOC acted inconsistently with th e obligations set out under Articles 2.1, 2.4, 2.4.2 
and 9.3 of the Anti-Dumping Agreement as well as Articles VI:1 and VI:2 of the GATT 1994.  The 
European Communities argues that although Article  9.3 of the Agreement does not prescribe a 
specific method for the assessment of duties, as point ed out by the Appellate Body, the margin of 
dumping calculated for the product under considerat ion as a whole operates as a ceiling for the duty 
assessed under Article 9.3.  In the view of the Eu ropean Communities, simple zeroing applied by the 
USDOC in the 37 periodic reviews at issue lead to ma rgins that were higher than the exporters' true 
margins because this method ignored the results of  comparisons where the export price exceeded the 
WA normal value.  Hence, according to the Europ ean Communities, the USDOC acted inconsistently 
with Articles 2 and 9.3 of the Agreement.
105   
7.115  The European Communities argues that, as reasoned by the Appellate Body, the fair 
comparison requirement embodied in Article 2.4 applies to duty assessment proceedings under 
Article 9.3 of the Agreement.  The simple zeroing methodology used by the USDOC in periodic 
reviews is inherently biased and unbalanced.  It systematically and inevitably results in a higher 
margin.  It follows that simple zeroing in periodic  reviews is inconsistent with Article 2.4 of the 
Agreement.   
7.116  The European Communities characterizes all an ti-dumping proceedings as an investigation 
and argues that Article 2.4.2 applies not only to original investigations, but to all anti-dumping 
proceedings, including periodic reviews.  Hence, ma rgins of dumping in periodic reviews have to be 
calculated consistently with the provisions of Article 2.4.2, i.e., for the product under consideration as 
a whole. 
7.117  The European Communities contends that the use of simple zeroing in the periodic reviews at 
issue was inconsistent with Article 2.4.2 of the Agreement, for two reasons.  First, the 
European Communities argues that th e USDOC acted inconsistently with Article 2.4.2 by using the 
third comparison methodology without observing the conditions laid down in the second sentence of 
Article 2.4.2.  Second, the European Communities po sits that the USDOC acted  inconsistently with 
Article 2.4.2 by ignoring the results of intermedia te comparisons where the export price exceeded the 
WA normal value. 
7.118  Finally, the European Communities asserts th at the USDOC acted inconsistently with 
Article 11.2 of the Agreement in the periodi c reviews at issue.  According to the 
European Communities, the calculation of the new cash  deposit rate in a periodic review constitutes a 
review into whether the continued imposition of  the duty is necessary within the meaning of 
Article 11.2.  The European Communities argues that  the effects of the calculation of the new cash 
deposit rates and the reviews under Article 11.2 are the same.  The European Communities contends 
that the USDOC acted inconsistently with the oblig ation set out under Article 11.2 because it failed to 
determine whether the continued imposition of the dut y was necessary to offset "dumping" within the 
meaning of Article 2, i.e., as calculated for the product under co nsideration as a whole.  Instead, the 
USDOC analyzed the need for the continued impositi on of the duty against something that did not 
constitute "dumping" within the meaning of Article 2. 
7.119  Regarding the Appellate Body report in US – Stainless Steel (Mexico) , the European 
Communities notes that the report once again confirms  the WTO-inconsistency of simple zeroing in 
periodic reviews and invites the Panel to take the same approach. 
                                                      
105 First Written Submission of the European Communities, para. 197.    WT/DS350/R 
 Page 47 
 
 
  (b) United States 
7.120  The United States argues that a general prohibition on zeroing applicable in the context of 
periodic reviews cannot be reconciled with the inte rpretation articulated by the Appellate Body in US 
– Softwood Lumber V , wherein the Appellate Body found that zer oing was prohibited in the context of 
WA-WA comparisons because the phrase "all comparable export transactions" in Article 2.4.2 meant 
that dumping must be determined for the "product as  a whole".  The United States contends that the 
Appellate Body subsequently, err oneously, extended the concept of "product under consideration as a 
whole" beyond this narrow context and ruled th at dumping cannot be determined for individual 
transactions.  The United States invites the Panel to  make its own objective assessment of the matter 
before it and to refrain from adop ting the Appellate Body's reasoning that fails to accept a permissible 
interpretation of the relevant treaty provisions, inconsis tently with the standard of review laid down in 
Article 17.6(ii) of the Anti-Dumping Agreement.   
7.121  The United States asserts that Article 2.1 of  the Agreement and Article VI:1 of the 
GATT 1994 contain definitional provisions that do not  impose independent legal obligations.  They 
are, however, important tools for the interpretation of the other relevant treaty provisions.  The 
United States submits that dumping may occur in a single export transaction.  There is no support in 
the GATT 1994 or the Anti-Dumping Agreement for the proposition that injurious dumping that occurs in a single transaction is mitigated by anot her transaction made at a non-dumped price.  The 
United States finds support for this reading of the concept of dumping in the GATT practice as well as 
the negotiating history of the Uruguay Round Anti-Dumping Agreement.  The United States submits that the Appellate Body in US – Softwood Lumber V  interpreted the expression "all comparable export 
transactions" under Article 2.4.2 of the Agreement to m ean that when multiple av eraging is used in an 
investigation, the results of all comparisons have to  be taken into account in the aggregation of such 
comparisons.  Subsequently, however, the Appellate  Body ruled that zeroing is prohibited whenever 
multiple comparisons are made. 
7.122  According to the United States, the Agreemen t does not support the argument that the word 
"product" generally refers to the "product under consideration as a whole".  The United States argues 
that in certain instances under the Anti-Dumping Agreement and the GATT 1994,  the word "product" 
is used to refer to individual transactions, rather  than the product under consideration as a whole.  In 
the same vein, the United States argues that in a pr ospective normal value system, the word "product" 
necessarily refers to a single transaction.   
7.123  The United States submits that the phrase "investigation phase" in Article 2.4.2 limits the 
application of this provision to investigations.  Interpreting Article 2.4.2 as applying to duty 
assessment proceedings under Article 9.3 would, theref ore, render the terms of Article 2.4.2, which 
expressly limit its application to investigations, inutile .  The United States contends that numerous 
provisions in the Anti-Dumping Agreement, as well  as previous panel and Appellate Body findings 
invalidate the contention that every anti-dumpi ng proceeding, including duty assessment proceedings 
under Article 9.3, constitutes an investigation within the meaning of Article 2.4.2.  The United States 
argues that because the application of Article 2. 4.2 is limited to the investigation phase of the 
proceeding, the Anti-Dumping Agreement does not support a prohibition on zeroing within the 
context of Article 9 periodic reviews. 
7.124  The United States also disagrees with the EC's as sertion that Article 2.4.2 applies to periodic 
reviews by virtue of the cross-reference found in  Article 9.3 to Article 2.  According to the 
United States, this cross-reference is subject to the li mitations that Article 2 itself contains.  It follows 
that Article 2.4.2 does not apply to periodic revi ews since its text limits its application to 
investigations.  The United States notes that th e European Communities implies that the USDOC 
should have shown that the conditi ons, laid down in the second sentence of Article 2.4.2, for the use 
of the asymmetrical third methodology were met before using it in periodic reviews.  The WT/DS350/R 
Page 48  
 
  United States disagrees with this proposition becau se Article 2.4.2 itself limits its application to 
investigations.  Furthermore, the United States submit s that Article 9.4(ii) specifically allows the use 
of the WA-T methodology in duty assessment proceedings.   
7.125  The United States submits that an interpreta tion that extends the prohibition on zeroing 
beyond the context of investigations where the WA -WA methodology is used would strip the second 
sentence of Article 2.4.2 of the Agreement of an y meaning.  More specifically, the United States 
contends that if zeroing is prohibited in all cont exts, the exceptional WA-T methodology provided for 
in the second sentence of Article 2.4.2 would math ematically yield the same result as the WA-WA 
methodology.  Such an approach would be incons istent with the principle of effective treaty 
interpretation.  In this regard, the United States notes that the European Court of First Instance 
approved zeroing in the context of the WA-T met hodology based on the "mathematical equivalence" 
argument.   
7.126  The United States argues that the EC's interpreta tion of the word "product" in the context of 
periodic reviews under Article 9.3 would render the pr ospective normal value systems retrospective.  
It would also preclude the achievement of the purpose of imposing an anti-dumping duty, i.e., 
counteracting injury caused by dumping. 
7.127  The United States contends that zeroing in pe riodic reviews is not inconsistent with 
Article 2.4 of the Agreement.  According to the Unite d States, the EC's claim under Article 2.4 is built 
on the presumption that the term "margin of dumping"  as used under Article 9.3 cannot be interpreted 
to refer to individual transactions.  Because Article 9.3 does not exclude such an interpretation, the 
EC's claim under Article 2.4 cannot be sustained.  The United States also di sagrees with the EC's 
proposition that zeroing is inherently unfair.  Ther e is, according to the United States, no support in 
the Agreement for this proposition.  A method cannot be labelled as fair or unfair simply because it 
gives rise to a higher or lower margin of dumpi ng.  The United States argues that interpreting 
Article 2.4 as generally prohibiting zeroing would render the distinctions between WA-WA and WA-
T methodologies found in Article 2.4.2 meaningless and would thus be inconsistent with the principle 
of effective treaty interpretation.
106 
7.128  Finally, the United States asserts that Article 11.2 does not apply to periodic reviews.  A 
periodic review carried out under Article 9.3 of the Agreement does constitute a review of the 
continued need for the imposition of the anti-dumpi ng duty.  The United States argues that a review 
under Article 11.2 focuses on the continuation or recurre nce of injury if the duty is removed, whereas 
a periodic review is simply about  determining a varying duty rate. 
7.129  Regarding the Appellate Body report in US – Stainless Steel (Mexico) , the United States 
submits that this report is "deeply flawed" and that  this Panel should not follow the reasoning in it.  
More specifically, the United States contends that  the Appellate Body's reasoning regarding the 
WTO-inconsistency of simple zeroing in periodic reviews lacks a legal basis.  Furthermore, the 
United States asserts that the Appellate Body improperly attaches a binding effect to adopted 
Appellate Body reports.  According to the United St ates, the drafters of the WTO Agreement had no 
such intention.  In this regard, the United St ates recalls that the WTO Agreement empowers the 
Ministerial Conference and the General Council, not  the Appellate Body, to provide authoritative 
interpretation of the provisions of the WTO Agreem ent.  The United States also notes that Articles 3.2 
and 19.2 of the DSU provide that the recommendations  and rulings of the DSB, and the findings and 
recommendations of panels and the Appellate Bo dy cannot add to, or diminish, the rights and 
obligations of WTO Members.  The United Stat es maintains that the obligation laid down in 
Article 11 of the DSU requires this Panel to carry out its own objective assessment of the matter before it.  In this regard, the United States notes that the panel in US – Stainless Steel (Mexico) 
                                                     
 
106 First Written Submission of the United States, para. 145.  WT/DS350/R 
 Page 49 
 
 
  concluded that the concern over a consistent line of jurisprudence should not override a panel’s task to 
carry out an objective assessment through an interp retation of the relevant treaty provisions in 
accordance with the custom ary rules of interpretation of public in ternational law.  The United States 
considers that an objective assessment should lead the Panel to depart from the Appellate Body's 
reasoning regarding the WTO-consistency of  simple zeroing in periodic reviews. 
2. Arguments of Third Parties 
(a) Brazil 
7.130  Brazil notes that despite numerous findings of in consistency regarding the practice of zeroing, 
the United States continues to apply it.  According to  Brazil, rulings in the past zeroing cases against 
the United States have reaffirmed the WTO-inconsiste ncy of this methodology.  Brazil also notes that 
most of the arguments put forward by the United States in this case have been tested and rejected by 
panels and the Appellate Body.  Brazil disagrees with  the main arguments on which the US defence is 
based in this case.  Brazil generally contends that the main concepts of Article 2 of the Agreement, 
i.e., "product", "margins of dumping" and "fair compar ison" apply to dumping determinations in all 
anti-dumping proceedings.  In Brazil's view, the Agreement links the concept of "dumping" to 
"product", not to "transaction".  Thus, there is no support in the Agreement for the US argument that 
dumping can be defined with respect to individua l import transactions.  Dumping is defined in 
relation to the product as a whole and this de finition applies to all kinds of anti-dumping 
investigations, be it original investigations, review  investigations or sunset  investigations.  Like 
"dumping", the concept of "margins of dumping" is  also defined in relation to the product under 
consideration as a whole.  The margin of dumping ma y not be properly established without taking into 
consideration results of all intermediate calculati ons made for the product under consideration as a 
whole.  The margin of dumping established on the b asis of all such intermediate calculations operates 
as a ceiling at which the resulting anti-dumping duty ma y be collected.  In this regard, Brazil submits 
that the concepts of "dumping", "margins of dum ping" and "product under consideration as a whole" 
are interlinked.  Brazil also argues that zeroing runs counter to the fair comparison requirement of 
Article 2.4 of the Agreement because it results in ar tificially high margins of dumping and therefore 
makes a finding of dumping more likely.   
7.131  Brazil disagrees with the US arguments regarding the last sentence of Article 2.4.2.  This 
article lays down an exceptional methodology.  This  methodology, however, cannot run counter to the 
principles underlying the Anti-Dumping Agreemen t which, according to Brazil, do not endorse 
zeroing per se .  Brazil also disagrees with the argum ent that because different anti-dumping 
proceedings have different purposes, they are not necessarily subject to the same disciplines.  No 
matter what the purpose of each of these proceedings is, the bottom line for Brazil is that they all deal 
with some sort of dumping margin calculation and that calculation has to be carried out in accordance with the disciplines of Article 2 of the Agreement.   Furthermore, Brazil notes that even assuming that 
these proceedings have different purposes, the flaws in the determinations made in one proceeding 
necessarily affect the determinations  in subsequent proceedings.   
7.132  Brazil does not find convincing the arguments pr esented by the United States regarding the 
negotiating history of the Agreement.  According to Brazil, the main issue underlying this dispute is 
the US consistent failure to abide by the DSB rulin gs that have condemned zeroing.  Brazil therefore 
invites the Panel to reiterate that zeroing is inco nsistent with the Agreement in all anti-dumping 
proceedings and irrespective of the methodology applied.   
(b)
 Japan 
7.133  Japan bases its arguments regarding the use of  zeroing in periodic reviews on the Appellate 
Body reports in the past zeroing disputes.  Japan notes the chapeau of Article 9.3 of the Agreement WT/DS350/R 
Page 50  
 
  which provides that "[t]he amount of the anti-dumping duty shall not exceed the margin of dumping 
as established under Article 2".  This, in Japan's vi ew, parallels the text of Article VI:2 of the 
GATT 1994.  It also reinforces the provision of Article  9.1 that the amount of the duty cannot be more 
than the margin of dumping.  According to Japan , the cross-reference in Article 9.3 to Article 2 
indicates that the authorities have to calculate the margin of dumping in administrative reviews with 
regard to the product under consideration as a whole.  It follows that if the authorities decide to carry 
out intermediate comparisons in the course of thei r dumping determinations in such reviews, they 
have to take into account the results of all such  comparisons in the calcu lation of the margin of 
dumping for the product under consideration as a whol e.  Japan argues that Article 6.10 of the 
Agreement precludes the calculation of margins of du mping for individual import transactions.  It also 
requires that margins be calculated for foreign pr oducers or exporters, not for importers.  Japan 
considers that authorities may assess duties on th e basis of import transactions as long as such 
assessment does not lead to a duty above the ma rgin of dumping calculated for the product under 
consideration as a whole and with respect to the exporter or foreign producer at issue.   
7.134  Japan disagrees with the US argument that Ar ticle 9.4(ii) of the Agreement which allows 
prospective normal value systems, lends support to  the view that dumping margins may be calculated 
for individual import transactions.  In this regard , Japan asserts that the concept of "margin of 
dumping" should not be confused with "amount of the duty".  Members may apply different methods 
with regard to assessing the amount of the duty to be paid.  The margin of dumping calculated in 
conformity with the disciplines of Article 2, however, operates as a ceiling on duty assessment.  
Hence, the duty assessed cannot go beyond the margin of dumping calculated for the product under 
consideration as a whole and with re gard to the exporter or foreign pr oducer at issue.  Japan therefore 
concludes that the use of zeroing in periodic review s is inconsistent with Articles 2.1 and 9.3 of the 
Agreement.  Japan, however, does not take any positi on with regard to the a lleged inconsistency of 
such zeroing with Articles 2.4.2 and 11.2 of the Agreement.   
7.135  Japan argues that the use of zeroing in periodic reviews is also inconsistent with the fair 
comparison obligation under Article 2.4 of the Agr eement because it leads to  a margin in excess of 
the true margin of the relevant exporters or foreign producers.   
7.136  Japan recalls that the Appellate Body is hierar chically superior to panels and that it has 
consistently held in the past ca ses that dealt with zeroing that such practice is WTO-inconsistent 
irrespective of the proceeding where it is used and the comparison methodology applied by the 
investigating authorities.  Japan ar gues that the need to provide se curity and predictability to the 
multilateral trading system, set forth in Article 3.2 of the DSU, requires this Panel to follow the 
Appellate Body's reasoning.  Japan recognizes that pa nels may, in exceptional circumstances, depart 
from the Appellate Body's reasoning, but argues that  this dispute presents no such circumstances.  
Japan therefore contends that in order to discharge  its obligation to carry out an objective examination 
of the matter before it, the Panel should rely on the Appellate Body's reasoning.   
(c) Korea 
7.137  Korea contends that Article 2.4 of the Agreemen t contains an obligation which is independent 
from the rest of Article 2.  This obligation app lies to all anti-dumping proceedings, including periodic 
reviews.  According to Korea, a comparison that fails  to take into consideration all export transactions 
cannot constitute fair comparison within the meaning of Article 2.4.  Such a method, in Korea's view, 
leads to an unfair comparison.  The use of zeroing by the USDOC in periodic reviews, therefore, is 
inconsistent with the fair comparison requirement embodied in Article 2.4, because it disregards the 
results of intermediate comparisons where th e export price exceeds the normal value.   
7.138  Korea further submits that the term "inves tigative phase" under Article 2.4.2 has a broad 
scope that covers periodic reviews.  According to Korea, the word "investiga tion" within the meaning  WT/DS350/R 
 Page 51 
 
 
  of Article 2.4.2 refers to the inquiry carried out by the authorities, rather than to a particular segment 
of the proceedings.  It follows that the use of the zeroing methodology in periodic reviews also conflicts with Article 2.4.2.  Korea rejects the US arguments that purport to distinguish periodic 
reviews from investigations.  Since both of th ese proceedings entail dumping margin calculations, 
they have to be subjected to the same legal di sciplines.  Korea therefore argues that the USDOC's 
margin calculations in periodic reviews is WTO-incons istent both with regard to the final liability of 
importers and the new cash deposit rate fo r exporters or foreign producers.   
7.139  Korea agrees with the EC's argument that Article  11.2 applies to periodic reviews and that the 
use of zeroing in such reviews also conflicts with  the obligation set forth under the mentioned Article.  
Korea also argues that the use of zeroing in periodic reviews is inconsistent with Article 9.3 of the 
Agreement.   
7.140  Regarding the relevance of past Appellate B ody reports on the issue of zeroing, Korea 
contends that the Panel should follow the reasoning de veloped and repeated in such reports.  This, in 
Korea's view, is critical with regard to maintaini ng the integrity of WTO dispute settlement.  On this 
issue, Korea also draws attention to the fact that that the United States asserts that the Panel should 
refrain from following the Appellate Body's reas oning on zeroing, while at the same time citing 
Appellate Body's other reports in order to strengthe n its legal arguments presented to the Panel.   
(d) Mexico 
7.141  Mexico generally agrees with the European Co mmunities with regard to the relevance to 
these proceedings of past Appellate Body reports  on the issue of zeroing.  Mexico recalls the 
Appellate Body's reports that found zeroing "as such " to be WTO-inconsistent and argues that the 
position taken by the United States in this case frust rates the purpose of allowing "as such" claims in 
WTO dispute settlement, which is to eliminate the root of WTO-inconsistent  behaviour.  Mexico 
notes that the measures at issue in this case and th e arguments presented by the United States are the 
same as those in the past zeroing cases and therefore invites the Panel to follow the Appellate Body's 
reasoning.  This, in Mexico's view, would also be co nsistent with the Panel's obligation to carry out an 
objective examination of the matter before it, as re quired under Article 11 of the DSU.  Mexico argues 
that not following the Appellate Body's reasoning in this case would undermine the need to provide 
security and predictability to the multilateral trading system as set forth under Article 3.2 of the DSU. 
7.142  Mexico disagrees with the US assertion that the Appellate Body's legal reasoning in the past 
zeroing cases has shifted over time.  According to Mexico, the Appellate Body's reasoning has been 
the same starting from the first zeroing case, i.e., EC – Bed Linen .  The Appellate Body based its 
reasoning on Articles VI:1 and VI:2 of the GATT 1994 and Article 2.1 of the Anti-Dumping 
Agreement which define "dumping" , for purposes of all anti-dumping pr oceedings, with reference to 
the product under consideration as a whole.  The Ap pellate Body recognized that the authorities could 
carry out multiple comparisons in the calculation of the margin of dumping but noted that the results of all such comparisons had to be taken into acc ount in determining the final margin for the product 
under consideration as a whole.  Furthermore, it held  that it was exporters or foreign producers, not 
importers, that dumped.  Finally, the Appellate Body opined that th is would ensure consistency in 
anti-dumping proceedings in the sense that the defini tion of "dumped imports" would be the same for 
purposes of dumping and injury determinations.  Me xico therefore disagrees with the US argument 
that the Appellate Body's reasoning is based on th e phrase "all comparable export transactions" under 
Article 2.4.2 of the Agreement. 
7.143  Mexico draws attention to the difference betw een duty collection systems and the calculation 
of margins of dumping.  Mexico acknowledges that the Agreement provides discretion as to different 
duty collection systems that Members may adopt.  Regardless of the system chosen, however, duties WT/DS350/R 
Page 52  
 
  collected continue to be subject to Article 9.3 of the Agreement which stipulates that duties cannot 
exceed the margin of dumping established under Article 2.   
(e) Norway 
7.144  Norway contends that the three comparison methodologies provided for under Article 2.4.2 of 
the Agreement constitute the only methods that may be used in all anti-dumping proceedings, 
including assessment reviews.  Norway notes th at Article 9.3 does not prescribe a methodology 
regarding duty assessment proceedings.  According to Norway, however, the cross-reference to 
Article 2 should be interpreted to mean that the au thorities have to observe the disciplines of Article 2 
in their determinations in duty assessment pro ceedings.  Furthermore, Norway asserts that 
Article 2.4.2 also applies to duty assessment pro ceedings.  Norway agrees with the EC's proposition 
that the word "investigation" w ithin the meaning of Article 2.4.2 does not refer to original 
investigations.  Rather, it refers to the inquiry carri ed out by investigating authorities in different anti-
dumping proceedings, including assessment proceedi ngs.  Limiting the scope of application of 
Article 2.4.2 to original investigations would, in Norway's view, lead to absurd results.   
3. Evaluation by the Panel 
(a) Relevant Facts 
7.145  The European Communities provided copies of the USDOC's Issues and Decision 
Memoranda for 30 of the 37 periodic reviews at issue.  The United States agrees that these memoranda show that simple zeroing was u sed in the relevant 30 periodic reviews.
107  The EC's 
claims regarding simple zeroing in periodic revi ews concern the following 37 periodic reviews: 
Number Product and Country Involved Period of Review Relevant 
Exhibits 
1 Steel Concrete Reinforcing Bars From Latvia 
USDOC No:  A-449-804 1 September 2004 – 
31 August 2005 EC-33 
2 Steel Concrete Reinforcing Bars From Latvia 
USDOC No:  A-449-804 1 September 2003 – 
31 August 2004 EC-34 
3 Steel Concrete Reinforcing Bars From Latvia 
USDOC No:  A-449-804 1 September 2002 – 
31 August 2003 EC-35&EC-81 
4 Ball Bearings and Parts Thereof From Italy 
USDOC No:  A-475-801 1 May 2004 –  
30 April 2005 EC-31 
5 Ball Bearings and Parts Thereof From Italy 
USDOC No:  A-475-801 1 May 2003 –  
30 April 2004 EC-36 
6 Ball Bearings and Parts Thereof From Italy 
USDOC No:  A-475-801 1 May 2002–30 
April 2003 EC-37 
7 Ball Bearings and Parts Thereof From Italy 
USDOC No:  A-475-801 1 May 2001 –  
30 April 2002 EC-38 
8 Ball Bearings and Parts Thereof From 
Germany USDOC No:  A-428-801 1 May 2004 –  
30 April 2005 EC-39 
9 Ball Bearings and Parts Thereof From 
Germany USDOC No:  A-428-801 1 May 2003 –  
30 April 2004 EC-40 
10 Ball Bearings and Parts Thereof From 
Germany 1 May 2002 –  
30 April 2003 EC-41 
                                                      
107 Response of the United States to Question 1(b) From the Panel Following the Second Meeting.    WT/DS350/R 
 Page 53 
 
 
  Number Product and Country Involved Period of Review Relevant 
Exhibits 
USDOC No:  A-428-801 
11 Ball Bearings and Parts Thereof From 
Germany USDOC No:  A-428-801 1 May 2001 –  
30 April 2002 EC-42 
12 Ball Bearings and Parts Thereof From France 
USDOC No:  A-427-801 1 May 2004 –  
30 April 2005 EC-43 
13 Ball Bearings and Parts Thereof From France 
USDOC No:  A-427-801 1 May 2003 –  
30 April 2004 EC-44 
14 Ball Bearings and Parts Thereof From France 
USDOC No:  A-427-801 1 May 2002 –  
30 April 2003 EC-45 
15 Ball Bearings and Parts Thereof From France 
USDOC No:  A-427-801 1 May 2001 –  
30 April 2002 EC-46 
16 Stainless Steel Bar From France 
USDOC No:  A-427-820 1 March 2004 –  
28 February 2005 EC-47&EC-82 
17 Stainless Steel Bar From France 
USDOC No:  A-427-820 1 March 2003 –  
29 February 2004 EC-48&EC83 
18 Stainless Steel Sheet And Strip In Coils From 
Germany 
USDOC No:  A-428-825 1 July 2004 –  
30 June 2005 EC-49 
19 Stainless Steel Sheet And Strip In Coils From 
Germany 
USDOC No:  A-428-825 1 July 2003 – 
30 June 2004 EC-50 
20 Stainless Steel Sheet And Strip In Coils From 
Germany USDOC No:  A-428-825 1 July 2002 – 
30 June 2003 EC-51 
21 Stainless Steel Sheet And Strip In Coils From 
Germany USDOC No:  A-428-825 1 July 2001 – 
30 June 2002 EC-52 
22 Stainless steel plate in coils From Belgium 
USDOC No:  A-423-808 1 May 2003 – 
30 April 2004 EC-53 
23 Stainless steel plate in coils From Belgium 
USDOC No:  A-423-808 1 May 2002 – 
30 April 2003 EC-54 
24 Ball Bearings and Parts Thereof From the 
United Kingdom 
USDOC No:  A-412-801 1 May 2003 –  
30 April 2004 EC-55 
25 Ball Bearings and Parts Thereof From the 
United Kingdom 
USDOC No:  A-412-801 1 May 2002 – 
30 April 2003 EC-56 
26 Stainless Steel Bar From Germany  
USDOC No: A-428-830 1 March 2004–28 
February 2005 EC-57  & EC-
84&  EC-
88&EC-89 
27 Stainless Steel Bar From Germany  
USDOC No:  A-428-830 2 August 2001–28 
February 2003 EC-58&EC-85 
28 Certain Hot-Rolled Carbon Steel Flat 
Products From the Netherlands USDOC No:  A-421-807 
(PRELIMINARY RESULTS) 1 November 2004 –
31 October 2005 EC-59 
29 Certain Hot-Rolled Carbon Steel Flat 
Products From the Netherlands 
USDOC No:  A-421-807 1 November 2002 –
31 October 2003 EC-60 WT/DS350/R 
Page 54  
 
  Number Product and Country Involved Period of Review Relevant 
Exhibits 
30 Certain Hot-Rolled Carbon Steel Flat 
Products From the Netherlands USDOC No:  A-421-807 3 May 2001 –  
31 October 2002 EC-61 
31 Stainless Steel Bar From Italy 
USDOC No:  A- 475-829 2 August 2001 –  
28 February 2003 EC-62&EC86 
32 Stainless Steel Sheet & Strip In Coils From 
Italy USDOC No:  A-475-824 1 July 2002 –  
30 June 2003 EC-63 
33 Stainless Steel Sheet & Strip In Coils From 
Italy 
USDOC No:  A-475-824 1 July 2001 –  
30 June 2002 EC-64 
34 Certain Pasta From Italy 
USDOC No:  A-475-818 1 July 2004 –  
30 June 2005 EC-65&EC-87 
35 Certain Pasta From Italy 
USDOC No:  A-475-818 1 July 2003 –  
30 June 2004 EC-66 
36 Certain Pasta From Italy 
USDOC No:  A-475-818 1 July 2002 –  
30 June 2003 EC-67 
37 Certain Pasta From Italy 
USDOC No:  A-475-818 1 July 2001 –  
30 June 2002 EC-68 
 
 
7.146  As far as the remaining seven periodic revi ews are concerned, th e European Communities 
initially did not submit copies of the USDOC's Issues and Decision Memoranda.  Following the 
second meeting with the parties, the Panel asked the European Communities why the copies of such 
memoranda had not been submitted for the seven peri odic reviews at issue and invited it, if it so 
wished, to do so.  In response, the European Commun ities stated that the copies of the memoranda in 
connection with the seven periodic reviews at is sue had not been submitted because, unlike those 
submitted in connection with the ot her 30 periodic reviews, the memoranda pertaining to the seven 
reviews did not contain any discussion on the issue of simple zeroing.108  The European Communities 
attached to its response copies of the memoranda that  belonged to the seven reviews.  In addition, the 
European Communities submitted, along with its res ponse to the Panel's question, copies of the two 
margin programmes used in one of the seven reviews, i.e., Stainless Steel Bar From Germany  (Period 
of Review:  1 March 2004 – 28 February 2005) . 
7.147  With regard to the submission by the Europ ean Communities of the two margin programmes 
pertaining to the periodic review in Stainless Steel Bar From Germany , the United States argues that 
such submission runs counter to  paragraph 14 of the Panel's Working Procedures because this 
constitutes new factual evidence which may only be  submitted in the circumstances described in 
paragraph 14.  The United States contends that  the Panel gave the European Communities the 
opportunity to submit copies of the relevant I ssues and Decision Memoranda, and argues that the 
submission of margin programmes fell out side the scope of such opportunity.109   
7.148  Paragraph 14 of our Working Procedures provides:   
"Each party shall submit all factual evidence to the Panel no later than during the first 
substantive meeting, except with respect  to evidence necessary for purposes of 
                                                      
108 Response of the European Communities to Question 1(c) From the Panel Following the Second 
Meeting. 
109 Comment of the United States on the Response of the European Communities to Question 1(c) 
From the Panel Following the Second Meeting.  WT/DS350/R 
 Page 55 
 
 
  rebuttals or answers to questions.  Exceptions  to this procedure will be granted upon a 
showing of good cause.  The other party shall be accorded a period of time for comment, as appropriate, on any new factual evidence submitted after the first substantive meeting."   
Paragraph 14 provides that all factual evidence has to be submitted not later than during the Panel's 
first substantive meeting.  However, it also contai ns certain exceptions.  Thus, paragraph 14 allows for 
the submission of factual evidence after the first subs tantive meeting of the Panel:  a) when this is 
necessary for purposes of rebuttals and answers to questions, or b) upon good cause shown.  Paragraph 14 also stipulates that where additiona l factual evidence is submitted after the first 
substantive meeting, the other party shall be given an opportunity to comment on it.  We disagree with 
the narrow interpretation presented by the United Stat es regarding the language in our question to the 
European Communities.  The question at issue reads in relevant parts:   
"Please explain the reason why the Europ ean Communities has not submitted a copy 
of the USDOC's Issues and Decision Memorandum in relation to 7 of the 36 Exhibits contained in the table above.  You may, if you so wish, submit copies of the 
Memoranda pertaining to the mentioned 7 administrative reviews, along with your 
answers to these questions."
110   
The reason why we invited the European Communities to submit copies of the relevant Issues and 
Decision Memoranda pertaining to the seven peri odic reviews at issue is because that was the 
document that the European Communities had submitte d in connection with the other 30 reviews.  We 
anticipated that the same memoranda pertaining to  the seven reviews would also contain discussions 
regarding the methodology used in such reviews.  We did not intend to limit the submission of 
evidence along with the EC's response to th e question at issue to such memoranda. 
7.149  We note that the European Communities submitted the additional factual information at issue 
along with its response to the Panel's question.  We also note that the United States has had an 
opportunity to comment on the documents submitted al ong with the EC's response.  We therefore 
disagree with the US view that the submission  of the two calculation tables conflicted with 
paragraph 14 of our Working Procedures.  In any ev ent, as explained in para. 7.154 below, we have 
found that the two computer programmes submi tted by the European Communities have not 
demonstrated that simple zeroing was used in the periodic review at issue. 
7.150  We now turn to our assessment of the eviden ce submitted by the European Communities with 
regard to the seven periodic reviews in which th e Issues and Decision Memoranda do not contain any 
discussion on the methodology used by the USDOC. 
(i) Steel Concrete Reinforcing Bars From Latv ia (Period of Review:  1 September 2002 – 
31 August 2003) 
7.151  In order to demonstrate that the USDOC used simple zeroing in this periodic review, the 
European Communities submitted, in Exhibit EC-35, th e copy of the Federal Register where the Final 
Results of the USDOC's determinations were publis hed, documents showing the standard computer 
programme that the USDOC used in this review, th e application of that programme to the producer 
subject to this review and tables that show the r esults of the calculations with and without zeroing.  
We note that the Final Results published by the USDOC in the Federal Register do not mention 
whether simple zeroing was used in the review at issue.  We also note that none of the other 
documents submitted by the European Communities we re issued by the USDOC during the review at 
issue.  The relevant parts of the programmes that we re allegedly used in the review at issue contain 
                                                      
110 Question 1(c) From the Panel Following the Second Meeting.   WT/DS350/R 
Page 56  
 
  certain computer commands which do not necessarily show that the simple zeroing methodology was 
used by the USDOC.  We do not consider that tabl es that allegedly contain results with and without 
zeroing necessarily show that simple zeroing was actua lly used in the periodic review at issue.  The 
European Communities also submitted, in Exhibi t EC-81, the copy of the USDOC's Issues and 
Decision Memorandum.  This Memorandum, however, does not mention whether simple zeroing was 
applied.  We therefore consider that the Europ ean Communities has failed to demonstrate as a matter 
of fact that simple zeroing was used by the USDOC in this periodic review. 
(ii) Stainless Steel Bar From France (Period of Review:  1 March 2004 – 28 February 2005) 
7.152  With regard to this periodic review, the Eu ropean Communities submitted, in Exhibit EC-47, 
the copy of the Federal Register where the Fina l Results of the USDOC's determinations were 
published and, in Exhibit EC-82, the copy of th e USDOC's Issues and Decision Memorandum.  None 
of these two documents shows that simple zeroing was used in this review.  We therefore consider 
that the European Communities has failed to dem onstrate that simple zeroing was used by the 
USDOC in this periodic review.   
(iii) Stainless Steel Bar From France (Period of Review:  1 March 2003 – 29 February 2004) 
7.153  With regard to this periodic review, the Eu ropean Communities submitted, in Exhibit EC-48, 
the copy of the Federal Register where the Fina l Results of the USDOC's determinations were 
published and, in Exhibit EC-83, the copy of  the USDOC's Issues and Decision Memorandum.  
Neither of these documents demonstrates that simple zeroing was used in this review.  We therefore 
consider that the European Communities has failed to demonstrate that simple zeroing was used by 
the USDOC in this periodic review.   
(iv) Stainless Steel Bar From Germany (Period of Review: 1 March 2004 – 28 February 2005) 
7.154  With regard to this periodic review, the Eu ropean Communities submitted, in Exhibit EC-57, 
the copy of the Federal Register where the Fina l Results of the USDOC's determinations were 
published, the standard programme used by the US DOC in the margin calculations in this periodic 
review, and a table showing the results with and w ithout zeroing.  We note that the Final Results 
published by the USDOC in the Federal Register do not mention whether simple zeroing was used in 
the review at issue.  The tables showing margin  calculations with and without zeroing were not 
generated by the USDOC during the review at issu e.  The European Communities also submitted, 
along with its Response to Question 1(c) From the Panel Following the Second Meeting, Exhibits EC-
88 and EC-89 containing two margin programmes used  in this periodic review and Exhibit EC-84 
containing the copy of the USDOC's Issues and Decision Memorandum. The documents containing 
the margin programmes were not generated by the USDOC during the review at issue.  Nor is it 
readily discernable from these documents that th e simple zeroing methodology was used in this 
periodic review.  The USDOC's Is sues and Decision Memorandum does not shed light on this issue 
either.  We therefore consider that the European  Communities has failed to demonstrate that simple 
zeroing was used by the USDOC in this periodic review. 
(v) Stainless Steel Bar From Germany (Period of  Review:  2 August 2001 – 28 February 2003) 
7.155  With regard to this periodic review, the Eu ropean Communities submitted, in Exhibit EC-58, 
the copy of the Federal Register where the Fina l Results of the USDOC's determinations were 
published, the standard programme used by the USDOC  in the margin calculations in this review as 
well as two tables showing the results with and w ithout zeroing.  We note that the Final Results 
published by the USDOC in the Federal Register do not mention whether simple zeroing was used in 
the review at issue.  The tables showing margin  calculations with and without zeroing were not 
generated by the USDOC during the review at issu e.  Nor does the copy of  the USDOC's Issues and  WT/DS350/R 
 Page 57 
 
 
  Decision Memorandum, submitted in Exhibit EC-85, de monstrate that simple zeroing was used.  We 
therefore consider that the Europ ean Communities has failed to demonstrate as a matter of fact that 
simple zeroing was used by the USDOC in this periodic review.   
(vi) Stainless Steel Bar From Italy (Period of Review:  2 August 2001 – 28 February 2003) 
7.156  With regard to this periodic review, the Eu ropean Communities submitted, in Exhibit EC-62, 
the copy of the Federal Register where the Fina l Results of the USDOC's determinations were 
published, a copy of the application of the US DOC's standard computer programme and a table 
showing the results of the calculations with zeroing.   We note that the Final Results published by the 
USDOC in the Federal Register do not mention whet her simple zeroing was used in the review at 
issue.  We also note that the calculation table a llegedly showing the results of calculations with 
zeroing was not produced by the USDOC.  Nor does the copy of the USDOC's Issues and Decision 
Memorandum, submitted in Exhibit EC-86, demonstrat e that simple zeroing was used.  We therefore 
consider that the European Communities has failed to demonstrate that simple zeroing was used by 
the USDOC in this periodic review.   
(vii) Certain Pasta From Italy (Period of Review:  1 July 2004 – 30 June 2005) 
7.157  With regard to this periodic review, the Eu ropean Communities submitted, in Exhibit EC-65, 
the copy of the Federal Register where the Fina l Results of the USDOC's determinations were 
published, a table that shows the application of the USDOC's computer programme to one of the 
exporters in this review and another table that allegedly shows the results of margin calculations 
without zeroing.  We note that the Final Results publ ished by the USDOC in the Federal Register do 
not mention whether simple zeroing was used in the review at issue.  The calculation tables submitted 
by the European Communities were not produced by the USDOC during the periodic review at issue.  
Nor is it readily discernable from such tables that si mple zeroing was used.  None of them, in our 
view, shows that the simple zeroing methodology at  issue in these proceedings was used by the 
USDOC in the review at issue.  Nor does the copy of the USDOC's Issues and Decision 
Memorandum, submitted in Exhibit EC-87, show th at simple zeroing was used.  We therefore 
consider that the European Communities has failed to demonstrate that simple zeroing was used by 
the USDOC in this periodic review. 
7.158  The European Communities has not shown that si mple zeroing was used in the seven reviews 
discussed above.  The Panel's findings regarding the use of simple zeroing in periodic reviews shall, 
therefore, not affect such reviews.111  Furthermore, we recall our finding above (para. 7.77) that the 
preliminary determinations identified in the EC's pane l request are not within our terms of reference.  
Hence, the periodic review on Certain Hot-Rolled Carbon Steel Fl at Products From the Netherlands   
(Period of Review:  1 November 2004 – 31 October 2005)  (Exhibit EC-59) is not within our terms of 
reference.  Consequently, our reas oning below regarding the use of si mple zeroing in periodic reviews 
only applies to 29 of the 37 reviews ch allenged by the European Communities. 
(b) Is Simple Zeroing in Periodic  Reviews WTO-Inconsistent?   
(i) Description of the Calculation Methodology Used By the USDOC in Periodic Reviews 
7.159  We note that the parties do not disagree over the description of the calculation methodology 
used by the USDOC to calculate margins of dumpi ng in periodic reviews.  The United States has a 
retrospective duty assessment system.  Under the US system, the anti-dumping duty imposed following an investigation does not constitute the final determination of liability for anti-dumping 
                                                     
 
111 The shaded lines in the table in para. 7.145 above represent the periodic reviews in which the Panel 
considers that the European Communities has not demonstrated that simple zeroing was used. WT/DS350/R 
Page 58  
 
  duties on imports of the subject product into the United States.  Rather, in the US system, an importer 
deposits a security in the form of a cash deposit at the time of importation.  Subsequently, the 
importer may, on an annual basis, ask the USDOC to  calculate the importer's final liability for anti-
dumping duties on all the imports made during the prev ious year.  Such a request may also be made 
by a domestic producer or a foreign exporter or pr oducer.  In such a periodic review, the USDOC 
carries out two calculations:  it calculates the final liability for anti-dumping duties for the importer on 
its imports during the period under review, and it cal culates a new cash deposit rate for each exporter's 
future entries.  The first is an importer-specific calculation whereas the sec ond is exporter-specific.  
Both calculations are based on no rmal value and export price data pertaining to the period under 
review. 
7.160  The method used by the USDOC with regard to  the calculation of these two margins is the 
same.  The product under considera tion is separated into model groups and a monthly WA normal 
value is determined for each model exported by e ach exporter subject to the review.  Each export 
transaction is compared against the relevant monthly WA normal value.  These comparisons are then aggregated, with the results of comparisons wh ere the export price exceeds the WA normal value 
treated as zero.  A WA margin of dumping is calcula ted for each exporter by dividing the aggregated 
total by the total value of exports, and this beco mes the cash deposit rate for that exporter for the 
subsequent period.  The calculation of the importer-specific assessment rate is similar.  The USDOC compares the exporter-specific WA normal value for each model with the export price in each transaction involving that exporter's product by the im porter.  These comparisons are then aggregated, 
with the results of comparisons where the export pr ice exceeds the WA normal value treated as zero.  
The aggregate total for all transactions is then di vided by the total value of imports made by the 
importer.  In other words, the numerator for th e exporter's WA dumping margin for the period of 
review, i.e., the future cash deposit rate, is the total of the comparisons where the normal value 
exceeds the export price and the denominator is the value of all exports from that exporter during the 
period of review.  The numerator fo r the importer-specific assessment ra te is the total of comparisons 
for all transactions where the normal value exceeds the export price for all imports by that particular 
importer, and the denominator is the total value of all imports by the importer.   
7.161  If the final importer-specific duty calculated in a periodic review exceeds the original cash 
deposit, the importer has to pay th e difference plus interest.  When the opposite is the case, the 
difference is reimbursed with interest.  Where no pe riodic review is requested, the initial cash deposit 
made at the time of importation is assessed as final duty. 
(ii) Legal Analysis 
7.162  The EC's claim regarding simple zeroing in periodic reviews raises a number of important 
issues of treaty interpretation.  The first is wh ether dumping may be determined on the basis of an 
individual export transaction or whether it requires an  aggregation of all export transactions made 
within the period of review.  The European Comm unities argues that dumping can only be determined 
for the product under consideration as a whole, i.e., that all export transactions pertaining to the 
product subject to a periodic review  have to be taken into consid eration in the calculation of the 
margin of dumping.  According to the European Co mmunities, simple zeroing in periodic reviews is 
inconsistent with Articles 2.1, 2.4, 2.4.2 and 9.3 of the Agreement because it precludes a dumping 
determination for the product under considerati on as a whole.  The United States disagrees and 
maintains that this proposition does not have a basis in the Agreement.  According to the 
United States, it is a permissible interpretation of the Agreement that dumping may be determined for 
individual export transactions.  We are inclined to ag ree with this conclusion, for the reasons stated 
most recently by the panel in US – Stainless Steel (Mexico)  case.
112   We note, however, that the 
                                                      
112 We recall that the WTO-consistency of simple zeroi ng in periodic reviews has been raised in three 
disputes so far, i.e. in US – Zeroing (EC) , US – Zeroing (Japan)  and US – Stainless Steel (Mexico) .  In all three  WT/DS350/R 
 Page 59 
 
 
  Appellate Body reversed the panel's findings in th is regard.  Drawing on its previous reasoning, the 
Appellate Body emphasized that dumping cannot be  determined on the basis of individual export 
transactions.  According to the Appellate Body, "if it were permissible to determine a separate margin 
of dumping for each individual transaction, several margins of dumping would exist for each exporter and for the product under consideration".
113  This, in the Appellate Body 's view, cannot be reconciled 
with the interpretation and application of sever al provisions of the Agreement, including a 
determination of injury under Article 3, the accep tance of price undertakings  under Article 8 and the 
conduct of reviews provided for under Articles 11.2 and 11.3.114 
7.163  A second issue, related to the first, is whet her dumping is necessarily an exporter-specific 
concept or whether it may also be determined fo r individual importers.  The European Communities 
maintains that dumping is an exporter-specific con cept.  The United States, however, disagrees and 
asserts that this approach does not have a basis in the Agreement.  We tend toward the view that  
dumping is not necessarily and exclusively an exporte r-specific concept, finding the reasoning of the 
panel in US –Stainless Steel (Mexico)  to be persuasive.  That panel drew attention, inter alia , to the 
importer-specific nature of the payment of anti-dumping duties.  According to the panel, the 
proposition that a margin of dumping can be de termined for individual importers represents a 
permissible interpretation of the relevant treaty prov isions within the meaning of Article 17.6(ii) of 
the Anti-Dumping Agreement.115  We note, however, that on this point also, the Appellate Body in US 
– Stainless Steel (Mexico)  reversed the panel, reiterating that dumping necessarily is an exporter-
specific concept.  The Appellate Body reasoned that  certain elements of the definitional provisions 
contained in Article 2.1 of the Anti-Dumping Ag reement and Article VI:1 of the GATT 1994 compel 
the notion that dumping reflects the exporter's be haviour.  The Appellate Body found contextual 
support for its interpretation in other provisions of  the Agreement, including Articles 2.3, 5.2(ii), 
6.1.1, 6.7, 5.8, 6.10, 9.5, 8.1, 8.2, 8.5 and 9.4(i) and (ii).116  The Appellate Body also restated the 
overarching requirement of Article 9.3 that the le vel of anti-dumping duty cannot exceed the margin 
of dumping as established under Article 2 of the Ag reement.  The Appellate Body reasoned that 
dumping can only be determined for the exporte r and in connection with the product under 
consideration as a whole, and considered that th is definition of "dumping" applies throughout the 
Agreement.  Therefore, the Appellate Body reasone d, the margin of dumping calculated in accordance 
with Article 2 establishes a ceiling for the total amount of anti-dumping duties that may be levied on the imports of the subject product.  The Appellate  Body concluded that there is "no basis in 
Article VI:2 of the GATT 1994 or in Articles 2 and 9.3 of the Anti-Dumping Agreement  for 
disregarding the results of comparisons where the export price exceeds the normal value when 
calculating the margin of dumping for an exporter."
117   
                                                                                                                                                                     
disputes, panels found simple zeroing in periodic reviews to be permissible under the Anti-Dumping 
Agreement.  All three panel reports were appealed and th e Appellate Body reversed the panels on this issue in 
all three cases.  We also note that in these cases the reasoning, respectively, of panels and the Appellate Body has generally been consistent on the legal issues concerning simple zeroing in periodic reviews.  The panels and 
the Appellate Body have generally developed their reasoning based on previous reports.  We note that the most 
recent dispute in which simple zeroing in periodic reviews was at issue, US – Stainless Steel (Mexico) , provides 
a comprehensive summary of the main legal issues and arguments raised by parties in disputes concerning this 
type of zeroing.  For ease of reference, therefore, we have cited to the panel and the Appellate Body reports in 
US – Stainless Steel (Mexico) , which reflect these previous panel and Appellate Body reports, rather than citing 
seriatim  all earlier reports reaching similar conclusions. 
113 Appellate Body Report, United States – Final Anti-Dumping Measures on Stainless Steel from 
Mexico  ("US – Stainless Steel (Mexico) "), WT/DS344/AB/R, adopted 20 May 2008, para. 99. 
114 Ibid. 
115 Panel Report, US – Stainless Steel (Mexico) , supra , note 97, paras.7.124-7.128.     
116 Appellate Body Report, US – Stainless Steel (Mexico) , supra , note 113, paras. 83-96.   
117 Ibid., para. 103.  The Appellate Body noted, inter alia , that if simple zeroing in periodic reviews 
were allowed under Article 9.3 of the Agreement, this  would allow Members to circumvent the prohibition, WT/DS350/R 
Page 60  
 
  7.164  The United States argues that prohibiting simple  zeroing in periodic reviews would favour 
importers with high margins vis-à-vis  importers with low margins.  We share these concerns and we 
note that the panel in US – Stainless Steel (Mexico)  agreed with the US arguments in this regard.
118  
The Appellate Body, however, revers ed the panel, observing that the prohibition of simple zeroing in 
periodic reviews does not preclude Members from carrying out an importer-specific inquiry in 
determining liability for the collection of anti-dumping duties, as long as the duty collected does not 
exceed the exporter-specific margin of dumping estab lished for the product unde r consideration as a 
whole.119 
7.165  The United States directs our attention to the f act that a Group of Experts convened in 1960 to 
consider certain issues regarding the operation of Article VI of the GATT 1947.  This Group, 
according to the United States, pointed out that the "ideal method" for the imposition of anti-dumping 
duties would be based on an importer-specific determination of dumping and injury.120  In our view, 
the opinion presented in that report supports the conclusion that dumping could be determined for 
individual importers.  The Appellate Body in US – Stainless Steel (Mexico) , however, rejected this 
argument, finding that interpretation of the Agreemen t in this regard does not necessitate an analysis 
of supplementary means of interpretation provided  for under Article 32 of the Vienna Convention.  
Furthermore, the Appellate Body reasoned that the report does not clarify whether simple zeroing in periodic reviews is allowed under the Anti-Dumping Agreement because it only reflects the views of 
some of the negotiating parties well before the Anti-Dumping Agreement came into force.
121 
7.166  The United States asserts that Article 9.4 ( ii) of the Agreement which provides for the 
prospective normal value systems, lends support to the proposition that dumping may be interpreted in 
relation to individual export transactions.  We tend to agree with the proposition that the recognition 
in the Agreement of a prospective normal value sy stem reinforces the argument that dumping may be 
determined on the basis of individual export transactions, and note that the panel in US – Stainless 
Steel (Mexico)  also agreed with this point of view.122  The Appellate Body, however, disagreed, 
stating that "the Panel has failed to distinguish be tween duty 'collection' at the time of importation, on 
the one hand, and determinations of the final duty liability of an importer and the margin of dumping 
for an exporter, on the other hand".123  The Appellate Body highlighted the fact that the duty collected 
at the time of importation under a prospective norma l value system does not represent the margin of 
dumping within the meaning of Article 9.3 and noted that such duty is subject to review under Article 
9.3.2.124 
7.167  The United States asserts that if the Agreement is  interpreted in a way that generally prohibits 
zeroing, the third methodology provided for under the second sentence of Article 2.4.2 would yield 
the same mathematical result as the first methodology.125  This, according to the United States and the 
                                                                                                                                                                     
under Article 2.4.2, on zeroing in investigations.  According to the Appellate Body, "this means that the mere 
act of conducting a periodic review would introduce zeroing following imposition of the anti-dumping duty order". Ibid., para. 109. 
118 Panel Report, US – Stainless Steel (Mexico) , supra , note 97, para. 7.146.   
119 Appellate Body Report, US – Stainless Steel (Mexico) , supra , note 113, para. 113. 
120 First Written Submission of the United States, para. 86. 
121 Appellate Body Report, US – Stainless Steel (Mexico) , supra , note 113, paras. 128-132.   
122 Panel Report, US – Stainless Steel (Mexico) , supra , note 97, paras. 7.130-7.133. 
123 (footnote omitted) Appellate Body Report, US – Stainless Steel (Mexico) , supra , note 113, 
para. 120.   
124 Ibid. 
125 We recall that the text of Article 2.4.2 reads: 
"Subject to the provisions governing fair comparison in paragraph 4, the existence of margins 
of dumping during the investigation phase shall normally be established on the basis of a comparison of a weighted average normal value with a weighted average of prices of all 
comparable export transactions or by a comp arison of normal value and export prices on a  WT/DS350/R 
 Page 61 
 
 
  panel in US – Stainless Steel (Mexico) , would render the second sentence of Article 2.4.2 inutile  and 
therefore run counter to the principle of effective trea ty interpretation.  On this issue, we tend to agree 
with the views expressed by the United States, as did the panel in US – Stainless Steel (Mexico) .126  
The Appellate Body dismissed this concern, noting that "if the determination of weighted average 
normal values was based on different time periods , dumping margin calculations under these two 
methodologies would yield different mathematical results".127  The Appellate Body also reiterated its 
view that "[b]eing an exception, the comparison methodology in the second sentence of Article 2.4.2 
(weighted average-to-transaction) alone cannot dete rmine the interpretation of the two methodologies 
provided in the first sentence".128  Furthermore, the Appellate Body reasoned that "[i]n order to 
unmask targeted dumping, an investigating authority may limit the application of the W-T comparison 
methodology to the prices of export transacti ons falling within the relevant pattern".129   
7.168  With regard to this last poin t, we note that the panel in US – Stainless Steel (Mexico) had 
pointed out:   
"This approach leaves certain questions una nswered.  First, the Appellate Body has 
not pointed to any textual basis for the prop osition that the export  transactions to be 
used in the third methodology would necessar ily be more limited than those in the 
first two methodologies.  In light of the text of  Article 2.4.2, it is not evident to us that 
dumping determinations in the third methodolog y could be limited to the subset of the 
export transactions that fall within the rele vant price pattern.  The second sentence of 
Article 2.4.2 simply mentions that the authorities may, under certain circumstances, compare prices of individual export transactions with the WA normal value.  It does 
not mention in any way whether such comparison may, or has to, be limited to the 
subset of export transactions that fall with in the relevant price pattern.  Second, 
assuming that this proposition does in fact have a textual basis in the Agreement, the Appellate Body did not explain how the au thorities would treat the remaining export 
transactions.  If, for instance, what the Appellate Body meant is that the export 
transactions that do not fall within the relevant price pattern are to be excluded from 
dumping determinations, this would mean disregarding them.  Given the Appellate 
Body's strongly expressed view that dumping has to be determined for the product under consideration as a whole and hence a ll export transactions pertaining to the 
product under consideration have to be taken into consideration by the authorities, we 
do not consider that this can be what the A ppellate Body meant.  Alternatively, if the 
Appellate Body meant that the authorities would use the WA-WA methodology with 
respect to the export transactions that do not  fall within the relevant price pattern, and 
combine these results with the results ob tained through the WA-T methodology for 
the prices that fall within the pattern, we not e that such an approach would also lead 
to the same mathematical result as the WA-WA methodology.  We therefore do not 
                                                                                                                                                                    
 
transaction-to-transaction basis.  A normal value established on a weighted average basis may 
be compared to prices of individual export tr ansactions if the authorities find a pattern of 
export prices which differ significantly among different purchasers, regions or time periods, and if an explanation is provided as to why such  differences cannot be taken into account 
appropriately by the use of a weight ed average-to-wei ghted average or 
transaction-to-transaction comparison." 
126 Panel Report, US – Stainless Steel (Mexico) , supra , note 97, paras. 7.130-7.133. 
127 (footnote omitted) Appellate Body Report, US – Stainless Steel (Mexico) , supra , note 113, 
para. 126. 
We note that the Appellate Body's rationale in this regard rests on the use of different data and must 
logically yield a differen t mathematical result. 
128 (footnote omitted) Appellate Body Report, US – Stainless Steel (Mexico) , supra , note 113, 
para. 127.   
129 (footnote omitted) Ibid. WT/DS350/R 
Page 62  
 
  consider that the Appellate Body's appro ach invalidates the mathematical equivalence 
problem."
130  (footnote omitted) 
The panel in that case expressed the view that the Appellate Body's reasoning regarding the 
mathematical equivalence argument in  earlier reports was not internally  consistent.  According to the 
panel, although the Appellate Body  expressed the view that while using the third methodology the 
authorities would limit their dumping determinations to  the subset of export transactions that fall 
within the relevant price pattern, it did not explai n how the export transactions outside that pattern 
would have to be treated.  We share the concern rai sed by that panel in this regard and note that the 
Appellate Body in US – Stainless Steel (Mexico)  did not address this concern. 
7.169  Having identified the issues raised by the EC's claim regarding simple zeroing in periodic 
reviews, and having reviewed the arguments of the pa rties and the reports of previous panels and the 
Appellate Body, we have generally found the r easoning of earlier panels on these issues to be 
persuasive.131  We are, however, faced with a situation where the Appellate Body reports, adopted by 
the DSB, have consistently reversed the findings in the mentioned panel reports that simple zeroing in 
periodic reviews is not WTO-inconsistent.  Therefor e, before setting out any definitive findings on the 
claim before us, we turn to an important systemic question. 
(iii) The Role of Jurisprudence 
7.170   Given the consistent line of reasoning underlyi ng the Appellate Body's conclusion regarding 
simple zeroing in periodic reviews, resolution of  the EC's claim before us necessarily requires 
consideration of the role of adopted Appellate Body  reports.  We note that the net effect of adopted 
Appellate Body or panel reports is not directly a ddressed in the DSU or in any covered agreement.  
This issue, however, has arisen in past disput es and the Appellate Body has addressed it.  In Japan – 
Alcoholic Beverages II , the Appellate Body opined:   
"Adopted panel reports are an important part of the GATT acquis .  They are often 
considered by subsequent panels.  They  create legitimate expectations among WTO 
Members, and, therefore, should be taken into account where they are relevant to any 
dispute.  However, they are not binding, except with respect to resolving the 
particular dispute between the parties to that dispute.   In short, their character and 
their legal status have not been cha nged by the coming into force of the WTO 
Agreement ."132 (footnote omitted, italic emphasis in original, underline emphasis 
added) 
The Appellate Body made this statement in the context of assessing the importance of adopted GATT 
panel reports.133  Its reasoning, however, also addresses the status of WTO panel reports.  In its 
reasoning, the Appellate Body underlines the fact  that adopted panel reports create legitimate 
expectations among WTO Members and opines that they should be taken into consideration by 
                                                      
130 Panel Report, US – Stainless Steel (Mexico) , supra , note 97, para. 7.139. 
131 We note, as the Appellate Body has recognized (Appellate Body Report, US – Stainless Steel 
(Mexico) , supra , note 113, para. 76), that Article 17.6(ii) of the Anti-Dumping Agreement allows for the 
possibility of more than one permissible interpretation of its  provisions.  We are of the view that the position of 
the United States, as reflected in the aforementioned panel reports, reflects at least one  permissible interpretation 
of the relevant provisions of the Anti-Dumping Agreement.  While the interpretation presented by the European 
Communities, and reflected in the Appellate Body reports on zeroing and the separate opinion of one Member of the Panel, ( infra  paras. 9.1-9.10), may also be a permissible interpretation, we do not believe that it is the only 
one. 
132 Appellate Body Report, Japan – Taxes on Alcoholic Beverages ("Japan – Alcoholic Beverages II "), 
WT/DS8/AB/R, WT/DS10/AB/R, WT/DS11/AB/R, adopted 1 November 1996, p. 14.   
133 Ibid., pp. 12-13.  WT/DS350/R 
 Page 63 
 
 
  subsequent panels where the legal issues are simila r, noting however, that such reports are not binding 
outside the scope of the relevant dispute. 
7.171  In the subsequent US – Shrimp (Article 21.5 – Malaysia)  dispute, the Appellate Body extended 
this reasoning to adopte d Appellate Body reports.134  The Appellate Body endorsed the reference that the 
panel in that case made to the Appellate Body's re port and pointed out that "[the Appellate Body] would 
have expected the [p]anel to do so".135  Subsequently, in US – Oil Country Tubular Goods Sunset 
Reviews , the Appellate Body went further regarding the role of adopted Appellate Body reports and 
expressed the view that "following the Appellate Body's conclusions in earlier disputes is not only 
appropriate, but is what would be expected from panels, especially where the issues are the same".136   
7.172  The panel in US – Stainless Steel (Mexico)  addressed the Appellate Body findings on the issue 
of simple zeroing in periodic reviews in reaching its  conclusion.  In reaching its conclusion, which did 
not follow these Appellate Body reports, the panel observed that although the DSU does not attribute a 
binding effect to adopted panel or Appell ate Body reports, "the Appellate Body de facto expects them to 
do so to the extent that the legal issues addressed are similar".137  The panel recalled and endorsed the 
view expressed by the panel in US – Zeroing (Japan)  that "the concern over the preservation of a 
consistent line of jurisprudence should not override a panel's task to carry out an objective examination 
of the matter before it" as re quired under Article 11 of the DSU.138   
7.173  On appeal, the Appellate Body re called its previous findings in Japan – Alcoholic Beverages II , 
US – Shrimp (Article 21.5 – Malaysia)  and US – Oil Country Tubular  Goods Sunset Reviews  and 
reiterated that "Appellate Body reports are not bindi ng, except with respect to resolving the particular 
dispute between the parties".139  Nonetheless, the Appellate Body noted, "[a]dopted panel and 
Appellate Body reports are often cited by parties in support of legal arguments in dispute settlement 
proceedings, and are relied upon by panels and the Appellate Body in subsequent disputes".140  
Furthermore, the Appellate Body pointed out, while  enacting or modifying their national legislation, 
Members often take into considera tion the interpretation of the covere d agreements developed in such 
reports.141  According to the Appellate Body, therefore,  "the legal interpretation embodied in adopted 
panel and Appellate Body reports becomes part and parcel of the acquis  of the WTO dispute 
settlement system".142 
7.174  In the view of the Appellate Body, the objectiv e examination obligation that Article 11 of the 
DSU imposes on WTO panels is informed by the general provisions of Article 3 of the DSU, 
including paragraph 2 thereof which provides that "[ t]he dispute settlement system of the WTO is a 
central element in providing security and pred ictability to the multilateral trading system".143  
According to the Appellate Body, ensuring "security  and predictability" in the dispute settlement 
                                                      
134 Appellate Body Report, United States – Import Prohibition of Certain Shrimp and Shrimp Products – 
Recourse to Article 21.5 of the DSU by Malaysia  ("US – Shrimp (Article 21.5 – Malaysia) "), WT/DS58/AB/RW, 
adopted 21 November 2001, para. 109.   
135 Ibid., para. 107. 
136 Appellate Body Report, United States – Sunset Reviews of Anti-Dumping Measures on Oil Country 
Tubular Goods from Argentina  ("US – Oil Country Tubular Goods Sunset Reviews "), WT/DS268/AB/R, adopted 
17 December 2004, DSR 2004:VII, 3257, para. 188.   
137 (emphasis in original) Panel Report, US – Stainless Steel (Mexico) , supra , note 97, para. 7.105.   
138 Ibid.   
139 (footnote omitted) Appellate Body Report, US – Stainless Steel (Mexico) , supra , note 113, 
para. 158. 
140 Ibid., para. 160. 
141 Ibid. 
142 Ibid. 
143 Ibid., para. 157. WT/DS350/R 
Page 64  
 
  system, in turn, requires the development of a cons istent body of case law and applying it to the same 
legal questions, absent cogent reasons.
144   
7.175  In addition, the Appellate Body underlined the hierarchical structure provided for in the DSU 
and opined:   
"The creation of the Appellate Body  by WTO Members to review legal 
interpretations developed by  panels shows that Members recognized the importance 
of consistency and stability in the interpretation  of their rights and obligations under 
the covered agreements.  This is essential  to promote "security and predictability"  in 
the dispute settlement system, and to ensure  the "prompt settlement" of disputes.  The 
Panel's failure to follow previously ad opted Appellate Body reports addressing the 
same issues undermines the development of a coherent and predictable body of 
jurisprudence clarifying Members' ri ghts and obligations under the covered 
agreements as contemplated under the DSU. "145 (emphasis added) 
The Appellate Body's views in this regard, partic ularly of the phrase "security and predictability",  
imply that the development of a consistent body of case law in order to clarify the rights and 
obligations of WTO Members is necessary.  The Appe llate Body pointed out that any panel report that 
fails to follow the case law developed through adopted panel and Appellate Body reports would 
undermine this important function of jurisprudence.  
7.176  Furthermore, the Appellate Body held:   
"Clarification, as envisaged in Article 3. 2 of the DSU, elucidates the scope and 
meaning of the provisions of the covered agreements in accordance with customary 
rules of interpretation of public interna tional law.  While the application of a 
provision may be regarded as confined to  the context in which it takes place, the 
relevance of clarification contained in adopt ed Appellate Body reports is not limited 
to the application of a particular provision in a specific case. "146 (emphasis added) 
In this part of its report, the Appellate Body expr essed the view that the legal interpretation contained 
in adopted Appellate Body reports has implicatio ns that go beyond the specifics of the relevant 
dispute.  That is, according to the Appellate Bo dy, such interpretation has to be taken into 
consideration in interpreting the rights and obligations of WTO Members.   
7.177  The Appellate Body expressed deep concern that the panel in US – Stainless Steel (Mexico)  
failed to follow the legal interp retation developed in the prior A ppellate Body reports regarding 
simple zeroing in periodic reviews.  According to  the Appellate Body, "[t]he [p]anel's approach has 
serious implications for the proper functioni ng of the WTO dispute settlement system[]".147  
Nonetheless, although Mexico had asked the Appellate Body to find that the panel's failure to follow 
established Appellate Body reasoning on simple zeroi ng in periodic reviews was inconsistent with the 
obligation to carry out an objective examinati on, as required under Article 11 of the DSU, the 
Appellate Body declined to make such a finding, c oncluding that "the [p]anel's failure flowed, in 
essence, from its misguided understanding of the legal provisions at issue".148 
                                                      
144 Ibid., para. 160. 
145 Ibid., para. 161. 
146 Ibid. 
147 Ibid., para. 162. 
148 Ibid.  WT/DS350/R 
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  7.178  In light of this recent report, we consider it necessary to review our obligations regarding 
decision-making.  We therefore start with the general obligations on panels set out in Article 11 of the 
DSU, which provides in relevant part: 
"Function of Panels 
The function of panels is to assist the DSB in discharging its responsibilities under 
this Understanding and the covered agreements.  Accord ingly, a panel should make 
an objective assessment of the matter before  it, including an objective assessment of 
the facts of the case and the applicability of and conformity with the relevant covered 
agreements, and make such other findi ngs as will assist the DSB in making the 
recommendations or in giving the rulings provi ded for in the covered agreements."   
7.179  Clearly, the guiding principle for the work of this or any other panel is the injunction that a 
panel undertake an "objective assessment" with regard  to both the facts and the law relevant to the 
dispute before it.  Such an objective assessment does not, of course, occur in a vacuum.  Other 
provisions of the DSU give context to this task.  Important contextual elements which must be taken 
into account are found in Article 3.2 of the DSU, which provides: 
"The dispute settlement system of the WTO is a central element in providing security 
and predictability to the multilateral trading system.   The Members recognize that it 
serves to preserve the rights and obligations  of Members under the covered 
agreements, and to clarify the existing provi sions of those agreements in accordance 
with customary rules of interpretation of  public international law. Recommendations 
and rulings of the DSB cannot add to or diminish the rights and obligations  provided 
in the covered agreements." (emphasis added) 
Thus, Article 3.2 establishes that the WTO dispute settlement system is intended to provide security 
and predictability to the multilateral trading system.  In this regard, of par ticular relevance among the 
elements that the WTO dispute settlement syst em comprises are the consultations process, 
examination of facts and law by panels, appeal on issues of law, and disciplines on the 
implementation of DSB recommendations and rulings  following a dispute, including recourse to 
proportioned retaliation.  All of these elements operate  together to provide security and predictability 
to the multilateral trading system.  The Appellate Bo dy suggests that security and predictability in the 
dispute settlement system per se  is a purpose served by the developm ent of a consistent body of case 
law based on panels following the reasoni ng of adopted Appellate Body reports.149  We agree that 
security and predictability in the multilateral trading system  may also be furthered by the development 
of consistent jurisprudence and applying it to th e same legal questions, absent cogent reasons to do 
otherwise.  In our view, it is obviously incumbent upon any panel to consider prior adopted Appellate 
Body reports, as well as adopted panel reports, a nd adopted GATT panel repor ts, in undertaking the 
objective assessment required by Article 11.  Prio r adopted reports form part of the GATT/WTO 
acquis , and, as stated by the Appellate Body, creat e legitimate expectations among WTO Members, 
and, therefore, should be taken in to account where they are relevant.150  However, we do not consider 
that the development of binding jurisprudence is  a contemplated element to enable the dispute 
settlement system to provide security and pred ictability to the multilateral trading system. 
7.180  Clearly, it is important for a panel to have cogent reasons for any  decision it reaches, 
regardless of whether or not there are any releva nt adopted reports, and whether or not the panel 
follows such reports.  An essential part of a panel's task under Article 11 is to explain  its objective 
assessment of the matter before it.  Such explanation,  as well as the reasons given, serve to ensure that 
                                                      
149 Ibid., para. 160. 
150 Appellate Body Report, Japan – Alcoholic Beverages II , supra , note 132, p. 14. WT/DS350/R 
Page 66  
 
  panels do not add to or diminish the rights and obligations of Members, while at the same time 
furthering the goal of providing security and predic tability to the multilateral trading system through 
the operation of the dispute settlement system.  In our view, however, a panel cannot simply follow 
the adopted report of another panel, or of the A ppellate Body, without careful consideration of the 
facts and arguments made by the parties in the disput e before it.  To do so would be to abdicate its 
responsibilities under Article 11.  By the same token,  however, neither should a panel make a finding 
different from that in an adopted earlier panel or Appellate Body report on similar facts and 
arguments without careful consideration and explan ation of why a different result is warranted, and 
assuring itself that its finding does not undermine the goals of the system. 
7.181  As discussed above, we share a number of concerns raised by the panel in US – Stainless 
Steel (Mexico) , particularly with regard to the US mathem atical equivalence argument.  We recognize, 
however, that the Appellate Body in its report reve rsed the panel's findings and this report gained 
legal effect through adoption by the DSB.  We note that this continues a series of consistent 
recommendations made by the DSB over the past sev eral years following reports that addressed the 
same issues based largely on the same arguments. 
7.182  In addition to the goal of providing security and predictability to the multilateral trading 
system, we recall that Article 3.3 of the DSU provides that "[t]he prompt settlement of situations in which a Member considers that any benefits accrui ng to it directly or indirectly under the covered 
agreements are being impaired by  measures taken by another Member is essential to the effective 
functioning of the WTO and the maintenance of a proper balance between the rights and obligations of Members".  Given the consistent adopted jurispru dence on the legal issues that are before us with 
respect to simple zeroing in periodic reviews, we consider that providing prompt resolution to this 
dispute in this manner will best serve the multiple goals of the DSU, and, on balance, is furthered by 
following the Appellate Body's adopted findings in this case. 
(iv) Conclusion 
7.183  Based on the foregoing considerations, we  conclude that the United States acted 
inconsistently with its obligati ons under Article VI:2 of the GATT 1994 and Article 9.3 of the Anti-
Dumping Agreement by applying simple zeroing in the 29 periodic reviews at issue.  Having found that the United States acted inconsistently with its  obligations under Article VI:2 of the GATT 1994 
and Article 9.3 of the Anti-Dumping Agreement, we d ecline to make findings with regard to the EC's 
claims under Articles 2.1, 2.4, 2.4.2 and 11.2 of th e Anti-Dumping Agreement and Article VI:1 of the 
GATT 1994.  
G. 
ZEROING IN SUNSET REVIEWS  
1. Arguments of the Parties 
(a) European Communities 
7.184  The European Communities challenges the use of  zeroing in 11 sunset reviews carried out by 
the USDOC.  The European Communities elaborates its  claims regarding the use of zeroing in sunset 
reviews, with reference to one specific sunset review, Stainless Steel Sheet & Strip in Coils – Italy , 
but argues that the same claims apply to the other sunset reviews at issue.  The 
European Communities argues that as part of its sunset determinations, the USDOC relies on 
previously-calculated dumping margins.  Hence, it relies on margins calculated through zeroing.  In 
the sunset review of Stainless Steel Sheet & Strip in Coils – Italy , based on the existence of dumping 
in the original investigation and the subsequent reviews, which had been calculated through zeroing, 
the USDOC determined that dumping would likely con tinue or recur should the duty be terminated.    WT/DS350/R 
 Page 67 
 
 
  7.185  The European Communities notes that Article 11.3 of the Agreement does not define the 
word "dumping".  The definition of dumping under Ar ticle VI:1 of the GATT 1994 and Article 2.1 of 
the Anti-Dumping Agreement, therefore, applies to s unset reviews.  It follows that dumping margins 
used in sunset reviews must conform to the provi sions of the Agreement, including Article 2.  The 
European Communities asserts that th e margins used by the USDOC in the sunset review at issue had 
been calculated inconsistently with Articles 2.1, 2.4 and 2.4.2 of the Agreement.  For this reason, the 
sunset determination reached through the USDOC's  reliance on these WTO-inconsistent margins is 
also inconsistent with the same provisions.  C onsequently, argues the European Communities, the 
USDOC also acted inconsistently with its obligations  under Articles 11.1 and 11.3 of the Agreement.   
(b) United States 
7.186  The United States argues that the EC's claims re garding the use of zeroing in sunset reviews 
has to be rejected because "[t]he [European Comm unities] has not demonstrated that a calculation 
done in accordance with the EC's a pproach would result in zero or de minimis  dumping margins in the 
cited cases, leading to a revocation of the order".151 
2. Arguments of Third Parties 
(a) Japan 
7.187  Japan contends that sunset determinations are inconsistent with the disciplines of the Anti-
Dumping Agreement to the extent they are based on past margins calculated through zeroing.  Japan 
does not take any position with regard to th e factual circumstances surrounding the sunset 
determinations challenged by the European Co mmunities in these proceedings.  Japan argues, 
however, that to the extent that the USDOC used  past margins established through zeroing, it acted 
inconsistently with Articles 2.1, 2.4, 11.3 of th e Anti-Dumping Agreement and VI:1 and VI:2 of the 
GATT 1994.   
(b) Korea 
7.188  In Korea's view, sunset reviews are the continuation of the previous anti-dumping 
proceedings and cannot be separated from them.  It fo llows that to the extent that the USDOC in its 
sunset determinations relies on past margins calcula ted through zeroing, it violates the obligations set 
forth under Articles 2.4, 2.4.2, 11.1 and 11.3 of the Agreement.   
(c) Norway 
7.189  Norway recalls the relevant Appellate Body repor ts and submits that to the extent that the 
authorities in a sunset review rely on past dumping margins obtained through zeroing, such reliance taints their sunset determinations.  Norway  disagrees with the US argument that the 
European Communities has to demonstrate that a calculation without zeroing would result in zero or 
de minimis  margins.  According to Norway , the EC's obligation is to show a breach of Article 11.3 of 
the Agreement.  It does not have to demonstrate what the past margins would have been without 
zeroing.  Nor does the Panel have to make su ch a determination for the United States.   
                                                     
 
151 First Written Submission of the United States, para. 154.   WT/DS350/R 
Page 68  
 
  3. Evaluation by the Panel 
(a) Relevant Facts 
7.190  The EC's claims regarding the use of zeroi ng in sunset reviews concern the following 
11 sunset reviews:   
Number Country and Product Involved USDOC Final 
Determination Relevant 
Exhibits 
1 Steel Concrete Reinforcing Bars From Latvia 
USDOC No:  A-449-804 72 FR 16767 
5 April 2007 
(PRELIMINARY 
RESULTS)  EC-70 
2 Ball Bearings and Parts Thereof From Italy 
USDOC No:  A-475-801 70 FR 58183 
5 October 2005 EC-71 
3 Ball Bearings and Parts Thereof From Germany 
USDOC No:  A-428-801 70 FR 58183 
5 October 2005 EC-72 
4 Ball Bearings and Parts Thereof From France 
USDOC No:  A-427-801 70 FR 58183 
5 October 2005 EC-73 
5 Stainless Steel Sheet And Strip In Coils From 
Germany USDOC No:  A-428-825 69 FR 67896 
22 November 2004 EC-74 
6 Stainless steel plate in coils From Belgium 
USDOC No:  A-423-808 69 FR 61798 
21 October 2004 EC-75 
7 Ball Bearings and Parts Thereof From the United 
Kingdom 
USDOC No:  A-412-801 70 FR 58183 
5 October 2005 EC-76 
8 Certain Hot-Rolled Carbon Steel Flat Products 
From the Netherlands USDOC No:  A-421-807 72 FR 7604 
16 February 2007 
(PRELIMINARY 
RESULTS) 
(ORDER 
REVOKED)  EC-77 
9 Stainless Steel Sheet & Strip In Coils From Italy 
USDOC No:  A-475-824 69 FR 67894 
22 November 2004 
 EC-69 
10 Certain Pasta From Italy 
USDOC No:  A-475-818 72 FR 5266 
5 February 2007 
(PRELIMINARY 
RESULTS)  EC-78 
11 Brass Sheet & Strip From Germany 
USDOC No:  A-428-602 71 FR 4348 
26 January 2006 EC-79 
 
7.191  We recall our finding above (para. 7.77) that th e preliminary determinations identified in the 
EC's panel request fall outside our terms of refere nce in these proceedings.  The three sunset reviews 
in the table above in connection with which th e European Communities is challenging the USDOC's 
preliminary determinations, therefore, will not be a ffected by our findings regarding zeroing in sunset  WT/DS350/R 
 Page 69 
 
 
  reviews.152  Our findings will only apply to eight of the 11 sunset determinations in the mentioned 
table.   
(b) Legal Analysis 
7.192  We note that the resolution of the EC's claim regarding the USDOC's de terminations in the 
eight sunset reviews at issue raises two issues:  (a) Can the authorities rely on past dumping margins 
obtained through zeroing, in making their determina tion regarding the likelihood of continuation or 
recurrence of dumping in a sunset review?  and (b ) Did the USDOC rely on past dumping margins 
obtained through zeroing in making its likelihood determ inations in the sunset reviews at issue in 
these proceedings?   
7.193  With regard to the first issue, we shall commenc e our analysis with the text of Article 11.3 of 
the Agreement.  Article 11.3 reads: 
"Notwithstanding the provisi ons of paragraphs 1 and 2,  any definitive anti-dumping 
duty shall be terminated on a date not la ter than five years from its imposition (or 
from the date of the most recent review under paragraph 2 if that review has covered both dumping and injury, or under this pa ragraph), unless the authorities determine, 
in a review initiated before that da te on their own initiative or upon a duly 
substantiated request made by or on be half of the domestic industry within a 
reasonable period of time prior to that date, th at the expiry of the duty would be likely 
to lead to continuation or recurrence of dumping and injury.  The duty may remain in force pending the outcome of such a review." (footnote omitted) 
7.194  Article 11.3 provides that an anti-dumping dut y shall terminate after five years from its 
imposition unless the authorities determine, before th e expiry of the five-year period, that such 
termination would lead to continuation or recurre nce of dumping and injury.  It does not, however, 
clarify the nature of such determination.  Speci fically, it does not mention whether the authorities can 
rely on past dumping margins in determining whet her the termination of the duty would lead to 
continuation or recurrence of dumping and injury.  Th is particular issue has arisen in WTO dispute 
settlement and the Appellate Body has made findings on it.  In US – Corrosion-Resistant Steel Sunset 
Review , the Appellate Body held that "authorities c onducting a sunset review must act with an 
appropriate degree of diligence and arrive at a reasoned conclusion on the basis of information 
gathered as part of a process of reconsideration and examination".
153  The Appellate Body also 
reasoned that the authorities are not required to calculate, or rely on, dumping margins in making their likelihood determination.  If, however, they choose to do so, such margins have to conform to the 
disciplines embodied in Article 2 of the Agreement.   Otherwise, the likelihood determination would 
                                                     
 
152 The order in Certain Hot-Rolled Carbon Steel Flat Products From the Netherlands  (Exhibit EC-77) 
was revoked on 23 April 2007.  The effective date of revocation was subsequently changed to 
29 November 2006.  See, Response of  the United States to Question 2(d) from the Panel Following the Second 
Meeting.  Both parties, in their Responses to Question 2(d) from the Panel Following the Second Meeting, expressed agreement that the Panel could, in principle, make findings on a revoked measure.  The 
European Communities further stated that it would su ffice if the Panel only made findings regarding this 
measure and not made recommendations.  As stated in para. 7.77 above, the order at issue is not within our terms of reference because it is one of the four prelimin ary measures identified in the EC's panel request.  We 
therefore need not, and do not, assess the issue of whether it would be appropriate to make findings and/or 
recommendations with regard to this revoked order.   
153 Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review , supra , note 56, para. 111. WT/DS350/R 
Page 70  
 
  be inconsistent with Article 11.3 of the Agreement.
154  That is, reliance on WTO-inconsistent margins 
would, in the Appellate Body's view, tain t the authorities' sunset determination.155   
7.195  The Appellate Body also applied this reasoning in the subsequent US – Zeroing (Japan)  
dispute and held:   
"In the present case, the Panel found, as a matter of fact, that, in its likelihood-of-
dumping determination, the USDOC relied 'on margins of dumping established in 
prior proceedings'.  The Panel further fo und that these margins were calculated during 
periodic reviews 'on the basis of simple zeroing'."156 (footnotes omitted) 
"We have previously concluded that zeroing, as it relates to periodic reviews, is 
inconsistent, as such, with Article 2.4 and Article 9.3.  As the likelihood-of-dumping 
determinations in the sunset reviews at issue in this appeal relied on margins of 
dumping calculated inconsistently with the Anti-Dumping Agreement , they are 
inconsistent with Article 11.3 of that Agreement."157 (footnote omitted, emphasis in 
original) 
7.196  We find convincing the Appellate Body's reasoni ng that to the extent margins relied on in 
sunset determinations are WTO-inconsistent the r esulting sunset determinati on is also rendered WTO-
inconsistent.  We have f ound model zeroing in investigations to be  inconsistent with Article 2.4.2 of 
the Anti-Dumping Agreement, and simple zeroing in  periodic reviews to be inconsistent with 
Article VI:2 of the GATT 1994 and Article 9.3 of  the Anti-Dumping Agreement (paras. 7.111 and 
7.183, respectively).  We shall, therefore, find th at the USDOC's determinations in the eight sunset 
reviews at issue were inconsistent with the USDOC obligation under Article 11.3 of the Agreement, if 
we find that the USDOC in those determinations relied on margins obtained through model zeroing in 
prior investigations or simple zeroing in prior periodic reviews. 
7.197  This brings us to the second issue that we ha ve identified at the outset of our analysis, i.e., 
whether the European Communities has demonstrated as a matter of fact that the USDOC relied, in 
the sunset reviews at issue, on prior margins obtained through zeroing.   
7.198  The European Communities generally argues that in the sunset reviews at issue, the USDOC 
used zeroed margins from prior investigations and periodic reviews.158  We note, however, that the 
European Communities builds its claim mainly on th e use of margins obtained through model zeroing 
in the underlying investigations.159  As the factual basis of this assertion, the European Communities 
submitted to the Panel copies of the Issues and De cision Memoranda issued by the USDOC in the 
sunset reviews at issue.  The European Co mmunities argues, and the United States acknowledges160, 
that in the sunset reviews at issue, the USDOC used margins obtained in the underlying 
investigations.  The European Communities recalls  that on 22 February 2007, the United States 
formally changed its calculation methodology in i nvestigations and abolished model zeroing.  The 
European Communities contends that since the i nvestigations from which the USDOC took margins 
                                                      
154 Ibid., para. 127.   
155 Ibid.  
156 Appellate Body Report, United States – Measures Relating to Zeroing and Sunset Reviews  ("US – 
Zeroing (Japan) "), WT/DS322/AB/R, adopted 23 January 2007, para. 184.   
157 Ibid., para. 185. 
158 See, for instance, First Written Submission of th e European Communities, paras. 242 and 263.  
159 See, for instance, Comments of the European Communities on the US Response to Question 2(a) 
from the Panel Following the Second Meeting.   
160 Response of the United States to Question 2(e) from the Panel Following the Second Meeting.    WT/DS350/R 
 Page 71 
 
 
  in the sunset reviews at issue were carried out befo re this date, it is clear that such margins were 
calculated through model zeroing.161   
7.199  The mentioned policy change, published in the Fede ral Register, provides in relevant parts:   
"The Department will no longer make average-to-average comparisons in 
investigations without providing offsets for non-dumped comparisons."162 
7.200  The United States does not deny this policy cha nge.  Nor does it contest the EC's argument 
that the investigations at issue were carried out before the effective date of the mentioned policy 
change.  It asserts, however, that "[s]uch a general statement ... does not provide specific evidence as to whether zeroing was employed in the margins relied upon in each of the challenged sunset reviews".
163  We disagree with the United States.  We note that the European Communities has 
submitted copies of the Memoranda prepared by the USDOC, which show that the latter used margins 
obtained in the underlying investigations, carried out  before the effective date of the USDOC's policy 
change regarding margin calculations in investig ations.  Thus, the European Communities has shown 
prima facie that the margins in the investigations at i ssue were obtained through model zeroing.  The 
United States has not, however, submitted evidence to rebut this assertion.  We therefore consider that 
the European Communities has demonstrated that in  the eight sunset reviews at issue, the USDOC 
relied, either exclusively or along with margin s obtained in prior periodic reviews, on margins 
obtained through model zeroing in prior investigations. 
7.201  The United States posits that "[t]he [European  Communities] has not demonstrated that a 
calculation done in accordance with the EC's approach would result in zero or de minimis  dumping 
margins in the cited cases, leading to a revocation of the order".164  The issue that the US argument 
raises is whether the impact of zeroing on the margin s used by the USDOC in the sunset reviews at 
issue has any bearing on the consistency with Article  11.3 of the USDOC's sunset determinations.  In 
our view, the impact of zeroing on the magnitude of margins obtained in the original investigations or 
periodic reviews is not relevant to the WTO-consis tency of a subsequent sunset review where such 
zeroed margins are used.  To the extent that a su nset determination is based on previous margins 
obtained through a methodology that is WTO-inconsis tent, the resulting sunset determination would 
also become WTO-inconsistent. 
7.202  Based on the foregoing, we find that the United Stat es acted inconsistently with its obligations 
under Article 11.3 of the Agreement by relying, in  the eight sunset reviews at issue, on margins 
obtained through model zeroing in prior investigatio ns.  Having found that the United States violated 
Article 11.3 of the Agreement in the sunset review s at issue, we need not, and do not, make findings 
with regard to the EC's claims under Articles 2.1, 2.4, 2.4.2 and 11.1 of the Agreement.   
VIII.  CONCLUSIONS AND RECOMMENDATIONS 
8.1 On the basis of the above findings, we conclude that:   
                                                      
161 Response of the European Communities to Question 2(b) from the Panel Following the Second 
Meeting.   
The United States argues that the EC's submission of new evidence, along with its Response to 
Question 2(b) from the Panel Following the Second Meetin g, was inconsistent with Article 14 of our Working 
Procedures.  Comment of the United States on the EC's Response to Question 2(b) from the Panel Following the 
Second Meeting.  For the reasons that we have explai ned in paras. 7.147-7.149 above, we reject the US 
contention.  In any event, we note that we have not relied on the information at issue in our report.   
162 Exhibit EC-90, p. 77722.  
163 Comment of the United States on the EC's Response to Question 2(b) from the Panel Following the 
Second Meeting.   
164 First Written Submission of the United States, para. 154.   WT/DS350/R 
Page 72  
 
  (a) The 14 anti-dumping proceedings that were id entified in the EC's panel request but 
not in its consultations request ar e within our terms of reference, 
(b) The EC's claims in connection with the c ontinued application of the 18 anti-dumping 
duties are not within our terms of reference, 
(c) The EC's claims regarding the four prelimin ary determinations identified in its panel 
request are outside our terms of reference, 
(d) The United States acted inconsistently
 with the obligation set out under Article 2.4.2 
by using model zeroing in the four investigations at issue in this dispute, 
(e) The United States acted inconsistently  with its obligations under Article VI:2 of the 
GATT 1994 and Article 9.3 of the Anti-Du mping Agreement by applying simple 
zeroing in the 29 periodic reviews at issue in this dispute, 
(f) The United States acted inconsistently  with its obligations under Article 11.3 of the 
Agreement by using, in the eight sunset reviews at issue in this dispute, dumping margins obtained through model zeroing in prior investigations.   
8.2 We have applied judicial economy with regard to:   
(a) The EC's claims under Article 2.4 of the Anti-Dumping Agreement and Articles VI:1 
and VI:2 of the GATT 1994 regarding the use of model zeroing in the four 
investigations at issue in this dispute, 
(b) The EC's claims under Articles 2.1, 2.4, 2.4.2 and 11.2 of the Anti-Dumping 
Agreement regarding the use of simple zeroing in the 29 periodic reviews at issue in this dispute, 
(c) The EC's claims under Articles 2.1, 2.4, 2.4.2 and 11.1 of the Agreement regarding 
the use, in the eight sunset reviews at issu e in this dispute, of margins obtained in 
prior proceedings through the zeroing methodology.   
8.3 We recommend that the DSB request the United States to bring its measures mentioned in 
paragraphs 8.1(d), 8.1(e) and 8.1(f) above into  conformity with its obligations under the WTO 
Agreement.   
8.4 The European Communities request s that we make a suggestion under the second sentence of 
Article 19.1 of the DSU.  The European Communities as ks the Panel to suggest that the steps that the 
United States might take in the implementation of the DSB recommendations and rulings following 
this dispute should be WTO-cons istent, particularly with regard to the issue of zeroing.
165  T h e  
United States submits that there is no basis in the DSU for a panel to make a suggestion for the 
purposes of avoiding unnecessary discussions about what  might or might not fall within the scope of a 
compliance panel.  According to the United St ates, "[i]t is unreasonable that the [European 
Communities] is even asking this Panel to start fro m the premise that there would be a dispute as to 
compliance".166 
8.5 Article 19.1 of the DSU provides:   
                                                      
165 Closing Statement of the European Communities at the Second Meeting.   
166 Comment of the United States on the EC's Response to Question 4 from the Panel Following the 
Second Meeting.    WT/DS350/R 
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  "Where a panel or the Appellate Body concl udes that a measure is inconsistent with a 
covered agreement, it shall recommend that the Member concerned bring the measure 
into conformity with that agreement.  In  addition to its recommendations, the panel or 
Appellate Body may suggest ways in which the Member concerned could implement the recommendations." (footnotes omitted) 
8.6 Article 19.1 stipulates that when a panel or the Appellate Body finds a measure to be 
inconsistent with a covered ag reement, it shall recommend that the measure be brought into 
conformity with the relevant agreement.  Furthermor e, it states that the panel or the Appellate Body 
may suggest ways in which such recommendation may be implemented. 
8.7 Having found that the United States acted incons istently with certain obligations that it 
assumed under the Anti-Dumping Agreement and the GATT 1994 a nd having made our 
recommendation as stipulated under Article 19.1, we  decline to make a suggestion on how the DSB 
recommendations and rulings may be implemented by the United States.  In our view, it is evident 
under the DSU, particularly Article 19.1 thereof, that Members must implement DSB recommendations and rulings in a WTO-consistent manner.  We cannot presume that Members might 
act inconsistently with their WTO obligations in the implementation of DSB recommendations and 
rulings.  We therefore reject the EC's request. 
IX. SEPARATE OPINION BY ONE MEMBER OF THE PANEL WITH REGARD TO 
THE EUROPEAN COMMUNITIES' CL AIMS REGARDING ZEROING IN 
INVESTIGATIONS AND ZEROING IN PERIODIC REVIEWS 
9.1 I agree with the conclusions reached by the majo rity of the Members of this Panel regarding 
all the claims raised by the European Communities in this dispute.  I, however, disagree with the legal 
reasoning developed by the majority regarding the EC 's claims on simple zeroi ng in periodic reviews, 
and, in part
167, model zeroing in investigations and provide my opinion below. 
9.2 I recall that zeroing disputes now have a long history in WTO dispute settlement and that 
different panels and the Appellate  Body have expressed their views on different types of zeroing on 
multiple occasions.168  Although my views generally overlap w ith the Appellate Body's reasoning on 
zeroing,  I would like to emphasize that they re flect my objective examination of the facts and the 
legal issues presented in this case, as required u nder Article 11 of the DSU, and not a simple 
acceptance of the Appellate Body's opinion. 
9.3 Considering that the approach that I take with  regard to model zeroing in investigations and 
simple zeroing in periodic reviews has been analy sed in great detail by the Appellate Body, I do not 
intend to address all such details here.  Instead, I shall emphasize the main points of my disagreement 
with the majority's reasoning in this dispute. 
9.4 The majority considers that a permissible in terpretation of the Anti-Dumping Agreement is 
that dumping may be determined in connection with  individual export transactions.  I note, however, 
that the majority also consider s the alternative interpretation, i.e., that dumping may be determined for 
the product under consideration as a whole, to be pe rmissible within the meaning of Article 17.6(ii) of 
the Anti-Dumping Agreement.169  The issue, therefore, is whether the relevant provisions of the 
                                                      
167 My legal reasoning regarding model zeroing in investigations differs from that of the majority in 
that, unlike the majority, I consider that model zeroing in investigations is inconsistent with Article 2.1 of the 
Agreement because it precludes a determin ation of dumping for "the  product under consider ation as a whole", in 
addition to being inconsistent with Artic le 2.4.2 as reasoned by the majority. 
168 I would like to note that the approach described in footnote 112 above, also applies to my separate 
opinion. 
169 Supra , footnote 131. WT/DS350/R 
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  Agreement allow more than one permissible interp retation regarding the WT O-consistency of model 
zeroing in investigations and simple zeroing in periodic reviews. 
9.5 In this regard, I agree with the view expressed by the Appellate Body that under Articles VI:1 
and VI:2 of the GATT 1994 and Article 2.1 of the Anti-Dumping Agreement, "dumping" and "margins of dumping" can only be found for the pr oduct under consideration as a whole.  Like the 
Appellate Body, I am of the view that there would be an anomaly if multiple margins were calculated 
for the same exporter.  In my view, a determin ation of dumping for the product under consideration as 
a whole is also necessary in order to make a de termination regarding the volume of dumped imports, 
injury and causal link.
170 
9.6 In addition, I disagree with the majority's opinion that dumping is not necessarily and 
exclusively an exporter-specific concept and that one can calculate an impor ter-specific margin of 
dumping.  In this regard, I find convincing the Appell ate Body's point of view that both Article VI:1 
of the GATT 1994 and Article 2.1 of the Anti-Dump ing Agreement support the notion that dumping 
necessarily reflects the exporter's behaviour.  Furtherm ore, I agree with the contextual support that the 
Appellate Body found in Articles 2.3, 5.2(ii), 6.1.1, 6.7,  5.8, 6.10, 9.5, 8.1, 8.2, 8.5 and 9.4(i) and (ii) 
of the Anti-Dumping Agreement for the exporter-s pecific nature of dumping.  In my view, no 
provision in the Agreement suggests that dumpi ng margins may be established for individual 
importers.  Furthermore, I am of the view that th e reference to "margin of dumping" in Article 9.3 
indicates that dumping may only be determined consis tently with the provisions of Article 2 and in 
relation to the product under consideration as a whole for an exporter. 
9.7 I disagree with the concerns expressed by the majority in this case that the prohibition of 
simple zeroing in periodic reviews w ould favour importers with high margins vis-à-vis  importers with 
low margins.  How an anti-dumping duty is to be coll ected is for the authorities to determine, the only 
requirement is that the duty collected not exceed the exporter-specific margin of dumping calculated 
for the product under consideration as a whole. 
9.8 Although the majority refers to the report of a Group of Experts that convened in 1960, I do 
not consider that it is necessary to have recourse to supplementary means of interpretation for the 
textual interpretation makes it sufficiently clear th at dumping may only be determined for exporters 
and in connection with the product under consideration as a whole. 
9.9 I do not agree with the majority  that the recognition of a prospective normal value system in 
Article 9.4(ii) of the Anti-Dumping Agreement reinforces the argument that dumping may be determined on the basis of individual export tran sactions.  This reasoning mixes duty collection at the 
time of importation with a determina tion of final duty liability.  Article 9.3 of the Agreement makes it 
clear that the amount of the duty collected at the time of importation does not represent a margin of dumping.  The duty collected at the time of importation, in my view, is subject to review under Article 9.3.2.  I see nothing in the Agreement to suggest that the duty collected in a prospective normal value 
system is exempt from a review under Article 9.3. 
9.10 The majority expresses the view that certain qu estions relating to the alleged mathematical 
equivalence between the first and the third met hodologies, in case zeroing is generally prohibited, 
have not been addressed by the Appellate Body.  In  this regard, I would recall, and agree with, the 
Appellate Body's explanation that, being an exceptio n to the two methodologies set out under the first 
sentence of Article 2.4.2, the third methodology ca nnot be used as a basis to interpret such other 
methodologies.  Secondly, as noted by the Appella te Body, one could argue that if zeroing was 
                                                     
 
170 I would like to note that my views regarding "product under consideration as a whole" apply both to 
model zeroing in investigations and simple zeroing in periodic reviews.  WT/DS350/R 
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  permitted under the first sentence of Article 2.4.2,  this would enable investigating authorities to 
capture pricing patterns constituting targeted dumping, thus rendering the third methodology inutile . 
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