WORLD TRADE  
ORGANIZATION  WT/DS322/12 
11 October 2006 
 
 (06-4940) 
 Original:   English 
  
UNITED STATES – MEASURES RELATING TO ZEROING  
AND SUNSET REVIEWS  
 
Notification of an Appeal by Japan  
under Article 16.4 and Article 17 of the Understanding on Rules  
and Procedures Governing the Settlement of Disputes (DSU),  
and under Rule 20(1) of the  Working Procedures for Appellate Review  
 
 
 The following notification, dated 11 October 2006, from the Delegation of Japan, is being 
circulated to Members.  
_______________ 
 
  Pursuant to Articles 16.4 and 17 of the Understanding on Rules and Procedures Governing 
the Settlement of Disputes  ("DSU") and Rule 20 of the Working Procedures for Appellate Review , 
Japan hereby notifies its decision to appeal to the A ppellate Body certain issues of law covered in the 
Panel Report on United States – Measures Relating to Zeroing and Sunset Reviews  (WT/DS322/R) 
("Panel Report"), and certain legal interpretations developed by the Pa nel in this dispute.  Japan seeks 
review by the Appellate Body of the Panel's findings and conclusions that:  
1. By maintaining the zeroing procedures for use in original investigations under a transaction-
to-transaction comparison method , the United States acts consistently with Articles 2.1, 2.4 
and 2.4.2 of the Agreement on Implementation of Articl e VI of the General Agreement on 
Tariffs and Trade 1994  ("Anti-Dumping Agreement "), and Articles VI:1 and VI:2 of the 
General Agreement on Tariffs and Trade 1994 ("GATT 1994").1  This conclusion is based on 
an erroneous interpretation and application of these provisions.  In particular, the Panel erred 
in law in finding that: 
(i) Articles 2.1 and 2.4.2 and Articles VI:1 and VI:2 do not require that "dumping" and 
"margins of dumping" be determined for the "product" under investigation as a whole 
and, instead, permit a determination of du mping for individual export transactions;2 
(ii) Article 2.4.2 permits the use of the zeroing procedures under the transaction-to-
transaction comparison method set out in the first sentence of that provision;3 and, 
(iii) Article 2.4 is subject to the allegedly "more specific" provisions of Articles 2.4.2 and 
9, and the zeroing procedures entail a "fair comparison" of export price and normal 
value.4 
                                                      
1 See Panel Report, paras. 7.143, 7.161 and 7.259(a). 
2 See, for example , Panel Report, paras. 7.92 to 7.102, 7.104 to 7.112, 7.118 to 7.120, 7.139, and 7.141 
to 7.143.  
3 See, for example , Panel Report, paras. 7.118 to 7.120, 7.127 to 7.143. 
4 See, for example , Panel Report, paras. 7.157 to 7.161.   WT/DS322/12 
Page 2  
 
  2. By maintaining the zeroing procedures for use in periodic reviews
, the United States acts 
consistently with Articles 2.1, 2.4, 9.1, 9.2 and 9.3 of the Anti-Dumping Agreement , and 
Articles VI:1 and VI:2 of the GATT 1994.5  This conclusion is based on an erroneous 
interpretation and application of these provisions.  In particular, the Panel erred in law in 
finding that: 
(i) Articles 2.1, 9.1, 9.2 and 9.3, and Artic les VI:1 and VI:2, do not require, for purposes 
of periodic reviews, that "dumping" and "mar gins of dumping" be determined for the 
"product" under investigation as a whole and, instead, permit a determination of 
dumping for individual export transactions;6 
(ii) Articles 9.1, 9.2 and 9.3, and Articles VI:1 and VI:2, permit, as a consequence, the 
assessment of the maximum amount of anti-dumping duties payable on the basis of a 
transaction-specific margin of dumping, instead of a margin of dumping for the "product" as a whole, for the foreign exporter or producer;
7 and,  
(iii) Article 2.4 is subject to the "more specif ic" provisions of Articles 2.4.2 and 9, and the 
zeroing procedures involve a "fair comparis on" of export price and normal value 
under this provision.8 
3. By applying the zeroing procedures in eleven periodic reviews  identified in Exhibits JPN-11 to 
JPN-21, the United States acted consistently with  Articles 2.1, 2.4, 9.1, 9.2 and 9.3 of the  Anti-
Dumping Agreement , and Articles VI:1 and VI:2 of the GATT 1994.9 This conclusion is based 
on an erroneous interpretation and application of  these provisions, as described in paragraph 2 
above.10 
4. By maintaining the zeroing proce dures for use in new shipper reviews , the United States acts 
consistently with Articles 2.1, 2.4 and 9.5 of the Anti-Dumping Agreement , and Articles VI:1 
and VI:2 of the GATT 1994.11  This conclusion is based on an erroneous interpretation and 
application of these provisions.  In particul ar, the Panel erred in law in finding that: 
(i) Articles 2.1 and 9.5, and Articles VI:1 and VI:2, do not require that "dumping" and 
"margin of dumping" be determined for the "product" under investigation as a whole 
and, instead, permit a determination of dumping for individual export transactions;12 
and, 
(ii) Article 2.4 is subject to the "more specif ic" provisions of Articles 2.4.2 and 9, and the 
zeroing procedures involve a "fair comparison" of export price and normal value.13 
                                                      
5 See Panel Report, paras. 7.216, 7.219, 7.222, and 7.259(b). 
6 See, for example , Panel Report, paras. 7.194 to 7.209,  7.216, 7.221 and 7.222.  
7 See, for example , Panel Report, paras. 7.194 to 7.209, 7.216, 7.221 and 7.222.  
8 See, for example , Panel Report, paras. 7.218 and 7.219. See also  Panel Report, paras. 7.157 to 7.160, 
and 7.196 to 7.209.   
9 See Panel Report, paras. 7.227 and 7.259(c). 
10 See Panel Report, paras. 7.226 and 7.227. 
11 See Panel Report, paras. 7.216, 7.219, 7.222, and 7.259(b). 
12 See, for example , Panel Report, paras. 7.194 to 7.209, 7.216, 7.221 and 7.222.  
13 See, for example , Panel Report, paras. 7.218 and 7.219. See also  Panel Report, paras.7.157 to 7.160 
and 7.196 to 7.209.  WT/DS322/12 
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  5. By relying, in the two sunset reviews  identified in Exhibits JPN-22 and JPN-23, on margins 
of dumping calculated using the zeroing procedur es in previous periodic reviews, the United 
States acted consistently with Articles 2.1, 2.4 and 11.3 of the Anti-Dumping Agreement .14 
This conclusion is in error because it is based  on the Panel's erroneous conclusion, described 
in paragraph 2 above, that the zeroing pr ocedures are permitted in periodic reviews.15 
 In sum, Japan considers that the Panel erred in law in the interpreta tion and application of 
Articles 2.1, 2.4, 2.4.2, 9.1, 9.2, 9.3, 9.5 and 11.3 of the Anti-Dumping Agreement , and Articles VI:1 
and VI:2 of the GATT 1994.  Japan requests that, u pon reversal of the Panel's erroneous findings and 
conclusions identified above, the A ppellate Body resolve this dispute promptly by finding that the 
United States violates these provisions by maintaining and applying the zeroing procedures.  
 
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14 See Panel Report, paras. 7.257 and 7.259(e). 
15 See also  Panel Report, paras. 7.256 and 7.257.