. /.  WORLD TRADE  
ORGANIZATION  WT/DS336/1 
G/L/765 
G/SCM/D65/1 
20 March 2006 
 (06-1179) 
 Original:   English 
  
JAPAN – COUNTERVAILING DUTIES ON 
DYNAMIC RANDOM ACCESS MEMORIES FROM KOREA 
 
Request for Consultations by Korea
 
  
 The following communication, dated 14 March 2006, from the delegation of Korea to the 
delegation of Japan and to the Chai rman of the Dispute Settlement Bo dy, is circulated  in accordance 
with Article 4.4 of the DSU. 
_______________ 
 
 
 My authorities have instructed me to request  consultations with the Government of Japan 
("Japan") pursuant to Article 4 of the Unders tanding on Rules and Procedures Governing the 
Settlement of Disputes ("DSU"), Article 30 of  the Agreement on Subsidies and Countervailing 
Measures ("SCM Agreement"), and Article XXII of the General Agreement on Tariffs and Trade 1994 ("GATT 1994"), with regard to th e imposition of countervailing duties by the 
Government of Japan on imports of certai n Dynamic Random Access Memories ("DRAMs") from 
Korea, notice of which was provided by Japan in  Cabinet Order No. 13 and Ministry of Finance 
Notice No. 35, published respectively in Issue No . 4264 and Special Issue No. 17 of the Official 
Gazette dated 27 January 2006,and certain aspects of th e investigation and determinations that led to 
the imposition of such duties. 
 
 The Government of Korea considers these determ inations by the Government of Japan to be 
inconsistent with its obligations under th e relevant provisions of the GATT 1994 and the 
SCM Agreement, including, but not limited to:  
 1. Article 1 of the SCM Agreement because, inter alia , Japan failed to demonstrate the 
existence of a financial contribution by th e Government of Korea within the meaning 
of Article 1 of the SCM Agreement. 
  2. Articles 1 and 2 of the SCM Agreement because, inter alia , Japan imposed and 
applied an improper burden of proof on res pondents and, in turn, Japan did not base 
its decisions on affirmative, objective and verifiable evidence. 
  3. Articles 1 and 14 of the SCM Agreement because, inter alia , Japan failed to 
demonstrate that a benefit was conferre d on respondent Hynix Semiconductor Inc. 
("Hynix"). 
 
 4. Articles 1 and 14 of the SCM Agreement because, inter alia , the analyses of the 
"commercial rationality" of loans and othe r investments in Hynix, and the other 
analyses related to the determination of the financial contribution and benefit to 
respondent Hynix, that were undertaken by  Japan are inconsistent with Japan's 
obligations under the SCM Agreement. 
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   5. Article 2 of the SCM Agreement because, inter alia , Japan failed to demonstrate that 
the alleged subsidies were specific to respondent Hynix on the basis of positive 
evidence. 
 
 6. Article 12 of the SCM Agreement because, inter alia , Japan improperly treated 
entities that had no interest in the inves tigation as "interested parties", improperly 
applied "facts available" instead of cons idering the information on the record, and 
improperly made adverse infere nces against the interests of respondent Hynix due to 
allegedly inadequate cooperation by other in terested parties or by other entities that 
were not under Hynix's control and that we re not obligated to participate in the 
investigation. 
  7. Article 14 of the SCM Agreement because, inter alia , Japan utilized methods for 
calculating the benefit to the alleged recipi ent of the alleged financial contributions 
that were not specified in Japan's national legislation or implementing regulations and 
that were not applied in a manner that w as transparent and adequately explained. 
  8. Article 15 of the SCM Agreement because, inter alia , Japan improperly found 
material injury caused by the alleged subs idized imports without proper evidentiary 
or legal foundations. 
  9. Article 15.5 and Article 19.1 of the SCM Agreement because, inter alia , Japan's 
determination failed to demonstrate that the allegedly subsidized imports were, 
through the effect of the alleged subsidies,  causing injury within the meaning of the 
SCM Agreement. 
  10. Articles 10, 14, 19 and 21 of the SCM Agreement because, inter alia , Japan imposed 
and maintained countervailing duties w ithout determining whether a benefit 
continued to exist following changes in  the ownership of respondent Hynix. 
 
 11. Articles 19 and 21 of the SCM Agreement because, inter alia , Japan improperly 
levied a countervailing duty on imports wh en there was no longer a benefit from the 
alleged past subsidies, and the duty was not necessary to counteract alleged 
subsidization. 
 
 12. Articles 10, 11, 12, 14, 15, 22 and 32.1 of the SCM Agreement and Articles VI:3 and 
X:3 of the GATT 1994 because, inter alia , Japan failed to conduct a thorough and 
complete investigation, and failed to  conduct its investigation and make 
determinations in accordance with funda mental substantive and procedural 
requirements. 
 
 13. Article 22 of the SCM Agreement because, inter alia , Japan failed to provide all 
relevant information on the matters of fact and law and reasons fo r its determinations. 
  The Government of Korea reserves its rights to  raise additional factual and legal issues during 
the course of the consultations and in any request for the establishment of a panel. 
 
 We look forward to the response of the Governme nt of Japan to this request so that we can 
schedule a mutually convenient date to begin consultations.  
__________