WORLD TRADE  
ORGANIZATION  WT/DS343/AB/R 
WT/DS345/AB/R 16 July 2008 
 
(08-3434) 
 Original:   English 
  
 
     
 
    
 
   
UNITED STATES – MEASURES RELATING TO SHRIMP FROM THAILAND 
 
AB-2008-3 
 
UNITED STATES – CUSTOMS BOND DIRECTIVE FOR MERCHANDISE 
SUBJECT TO ANTI-DUMPING/COUNTERVAILING DUTIES 
 
AB-2008-4 
  
 
    
 
    
Report of the Appellate Body 
  WT/DS343/AB/R 
 WT/DS345/AB/R 
 Page i 
 
 
I. Introduction................................................................................................................... ..............1  
II. Arguments of the Participants and the Third Participants ..........................................................9  
A. Claims of Thailand – Appellant in US – Shrimp (Thailand).......................................... 9 
1. Ad Note to Article VI:2 and 3 of the GATT 1994 ............................................9  
2. Cash Deposits and Anti-dumping Duties........................................................13  
3. The Reasonableness of the EBR, as Applied to Subject Shrimp ....................16  
B. Arguments of the United States – Appellee in US – Shrimp (Thailand) ...................... 16 
1. Ad Note to Article VI:2 and 3 of the GATT 1994 ..........................................16  
2. Cash Deposits and Anti-dumping Duties........................................................22  
3. The Reasonableness of the EBR, as Applied to Subject Shrimp ....................23  
C. Claims of the United States – Other Appellant in US – Shrimp (Thailand) ................ 24 
1. The Reasonableness of the EBR, as Applied to Subject Shrimp ....................24  
2. The Panel's Analysis of the Term "Necessary" under Article XX(d) of 
the GATT 1994...............................................................................................25  
D. Arguments of Thailand – Appellee in US – Shrimp (Thailand) ................................... 26 
1. The Reasonableness of the EBR, as Applied to Subject Shrimp ....................26  
2. The Panel's Analysis of the Term "Necessary" under Article XX(d) of 
the GATT 1994...............................................................................................30  
E. Claims of India – Appellant in US – Customs Bond Directive .................................... 31 
1. Ad Note to Article VI:2 and 3 of the GATT 1994 ..........................................31  
2. Cash Deposits and Anti-dumping Duties........................................................35  
3. The Reasonableness of the EBR, as Applied to Subject Shrimp ....................35  
4. "As Such" Consistency of the Ame nded CBD with Articles 1 and 18.1 
of the Anti-Dumping Agreement  and Articles 10 and 32.1 of the SCM 
Agreement .......................................................................................................36  
5. Consistency of the Amended CBD with Article 9 of the Anti-Dumping 
Agreement  and Article 19 of the SCM Agreement ..........................................37  
6. Completing the Analysis on Article 18.4 of the Anti-Dumping 
Agreement  and Article 32.5 of the SCM Agreement .......................................38  
7. The Panel's Terms of Reference .....................................................................38  
8. The Availability of a Defence under Article XX(d) of the GATT 1994 
to the United States.........................................................................................40  
9. Prima Facie  Case by the Panel under Article XX(d) of the GATT 1994.......40  
F. Arguments of the United States – Appellee in US – Customs Bond Directive............. 41 
1. Ad Note to Article VI:2 and 3 of the GATT 1994 ..........................................41  
2. Cash Deposits and Anti-dumping Duties........................................................44  
3. The Reasonableness of the EBR, as Applied to Subject Shrimp ....................45  
4. "As Such" Consistency of the Ame nded CBD with Articles 1 and 18.1 
of the Anti-Dumping Agreement  and Articles 10 and 32.1 of the SCM 
Agreement .......................................................................................................46  
5. Consistency of the Amended CBD with Article 9 of the Anti-Dumping 
Agreement  and Article 19 of the SCM Agreement ..........................................47  
6. Completing the Analysis on Article 18.4 of the Anti-Dumping 
Agreement  and Article 32.5 of the SCM Agreement .......................................47  
7. The Panel's Terms of Reference .....................................................................47  WT/DS343/AB/R 
WT/DS345/AB/R Page ii 
 
 
8.
 The Availability of a Defence under Article XX(d) of the GATT 1994 to the United States.........................................................................................48
 
9. Prima Facie  Case by the Panel under Article XX(d) of the GATT 1994.......48  
G. Claims of the United States – Other Appellant in US – Customs Bond Directive ....... 49 
1. The Reasonableness of the EBR, as Applied to Subject Shrimp ....................49  
2. The Panel's Analysis of the Term "Necessary" under Article XX(d) of 
the GATT 1994...............................................................................................50  
H. Arguments of India – Appellee in US – Customs Bond Directive................................ 51 
1. The Reasonableness of the EBR, as Applied to Subject Shrimp ....................51  
2. The Panel's Analysis of the Term "Necessary" under Article XX(d) of 
the GATT 1994...............................................................................................55  
I. Arguments of the Third Participants............................................................................ 55 
1. Brazil...............................................................................................................55  
2. Chile................................................................................................................58  
3. European Communities...................................................................................59  
4. India ................................................................................................................61  
5. Japan ...............................................................................................................62  
6. Korea...............................................................................................................64  
7. Thailand ..........................................................................................................65  
III. Issues Raised in These Appeals ................................................................................................6 6 
IV. The Measure at Issue ........................................................................................................... .....68  
A. Introduction ................................................................................................................. 68 
B. Background.................................................................................................................. 69 
1. The Retrospective Anti-Dumping Duty Assessment System of the 
United States...................................................................................................69  
2. Overview of Customs Bond Requirements in the United States ....................70  
3. The Enhanced Continuous Bond Requirement...............................................71  
V. The Interpretation of the Ad Note to Article VI:2 and 3 of the GATT 1994 ............................75  
A. Introduction ................................................................................................................. 75 
B. The Temporal Scope of the Ad Note ............................................................................ 77 
1. Interpretation of the Phrase "pending final determination of the facts in 
any case of suspected dumping" .....................................................................84  
2. Impermissible Response to Dumping .............................................................88  
3. The Ad Note to Article VI:2 and 3 of the GATT 1994 and Article 7 of 
the Anti-Dumping Agreement  (Provisional Measures) ...................................89  
4. The Panel's Legal Characterization of Cash Deposits ....................................90  
C. Conclusion ................................................................................................................... 93 
VI. The Reasonableness of the EBR, as Applied to Subject Shrimp ..............................................93  
A. The Assessment of Reasonableness under the Ad Note................................................ 99 
B. The Reasonableness of the EBR, as  Applied to Subject Shrimp ................................ 102  WT/DS343/AB/R 
 WT/DS345/AB/R 
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 VII.
 India's Claims that the Amended CBD is "As Such" Inconsistent with Articles 1 
and 18.1 of the Anti-Dumping Agreement  and Articles 10 and 32.1 of the SCM 
Agreement ............................................................................................................................... 104 
VIII. India's Claims that the Amended CBD is  Inconsistent with Article 9 of the Anti-
Dumping Agreement  and Article 19 of the SCM Agreement .................................................106  
IX. India's Request for Completion of the Analysis on Article 18.4 of the Anti-Dumping 
Agreement and Article 32.5 of the SCM Agreement ...............................................................108  
X. The Panel's Terms of Reference .............................................................................................109  
XI. Whether the Panel Made a Prima Facie  Case for the United States ......................................114  
XII. The Panel's Analysis of the Term "Neces sary" in Article XX(d) of the GATT 1994 ............117  
XIII. Findings and Conclusions....................................................................................................... 123 
 
 
ANNEX I Notification of an Appeal by Thailand in US – Shrimp (Thailand)  
 
ANNEX II Notification of an Appeal by India in US – Customs Bond Directive  
 ANNEX III Notification of an Other Appeal by the United States in US – Shrimp (Thailand) 
 
ANNEX IV Notification of an Other Appeal by the United States in US – Customs Bond Directive  WT/DS343/AB/R 
WT/DS345/AB/R Page iv 
 
 
TABLE OF CASES CITED IN THIS REPORT 
 
Short Title Full Case Title and Citation 
Argentina – Footwear (EC)  Appellate Body Report, Argentina – Safeguard Measures on Imports of 
Footwear , WT/DS121/AB/R, adopted 12 January 2000, DSR 2000:I, 515 
Brazil – Aircraft  Appellate Body Report, Brazil – Export Financing Programme for Aircraft , 
WT/DS46/AB/R, adopted 20 August 1999, DSR 1999:III, 1161 
Brazil – Aircraft  Panel Report, Brazil – Export Financing Programme for Aircraft , WT/DS46/R, 
adopted 20 August 1999, as modified by Appellate Body Report, 
WT/DS46/AB/R, DSR 1999:III, 1221 
Brazil – Desiccated Coconut  Appellate Body Report, Brazil – Measures Affe cting Desiccated Coconut , 
WT/DS22/AB/R, adopted 20 March 1997, DSR 1997:I, 167 
Brazil – Desiccated Coconut  Panel Report, Brazil – Measures Affecting Desiccated Coconut , WT/DS22/R, 
adopted 20 March 1997, upheld by Appellate Body Report, WT/DS22/AB/R, 
DSR 1997:I, 189 
Brazil – Retreaded Tyres Appellate Body Report, Brazil – Measures Affecting Imports of Retreaded Tyres , 
WT/DS332/AB/R, adopted 17 December 2007 
Canada – Wheat Exports and 
Grain Imports Appellate Body Report, Canada – Measures Relating to Exports of Wheat and 
Treatment of Imported Grain , WT/DS276/AB/R, adopted 27 September 2004, 
DSR 2004:VI, 2739 
Chile – Price Band System  Appellate Body Report, Chile – Price Band System and Safeguard Measures 
Relating to Certain Agricultural Products , WT/DS207/AB/R, adopted 23 October 
2002, DSR 2002:VIII, 3045, and Corr.1 
EC – Hormones  Appellate Body Report, EC Measures Concerning Meat and Meat Products 
(Hormones) , WT/DS26/AB/R, WT/DS48/AB/R, adopted 13 February 1998, 
DSR 1998:I, 135 
EEC – Parts and Components  GATT Panel Report, European Economic Community – Regulation on Imports 
of Parts and Components , L/6657, adopted 16 May 1990, BISD 37S/132 
Guatemala – Cement I  Appellate Body Report, Guatemala – Anti-Dumping Investigation Regarding 
Portland Cement from Mexico , WT/DS60/AB/R, adopted 25 November 1998, 
DSR 1998:IX, 3767 
Japan – Agricultural 
Products II  Appellate Body Report, Japan – Measures Affecting Agricultural Products , 
WT/DS76/AB/R, adopted 19 March 1999, DSR 1999:I, 277 
Korea – Alcoholic Beverages Panel Report, Korea – Taxes on Alcoholic Beverages , WT/DS75/R, WT/DS84/R, 
adopted 17 February 1999, as modified by Appellate Body Report, WT/DS75/AB/R, WT/DS84/AB/R, DSR 1999:I, 44 
Korea – Dairy  Appellate Body Report, Korea – Definitive Safeguard Measure on Imports  
of Certain Dairy Products , WT/DS98/AB/R, adopted 12 January 2000, 
DSR 2000:I, 3 
Korea – Various Measures on 
Beef  Appellate Body Report, Korea – Measures Affecting Imports of Fresh, Chilled 
and Frozen Beef , WT/DS161/AB/R, WT/DS169/AB/R, adopted 10 January 2001, 
DSR 2001:I, 5 
Mexico – Anti-Dumping Measures on Rice Appellate Body Report, Mexico – Definitive Anti-Dump ing Measures on Beef 
and Rice, Complaint with Respect to Rice , WT/DS295/AB/R, adopted 
20 December 2005, DSR 2005:XXII, 10853  WT/DS343/AB/R 
 WT/DS345/AB/R 
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Short Title Full Case Title and Citation 
Mexico – Corn Syrup  
(Article 21.5 – US)  Appellate Body Report, Mexico – Anti-Dumping Investigation of High Fructose 
Corn Syrup (HFCS) from the United States – Recourse to Article 21.5 of the DSU  
by the United States , WT/DS132/AB/RW, adopted 21 November 2001, 
DSR 2001:XIII, 6675 
US – 1916 Act  Appellate Body Report, United States – Anti-Dumping Act of 1916 , 
WT/DS136/AB/R, WT/DS162/AB/R, adopted 26 September 2000, DSR 2000:X, 
4793 
US – 1916 Act (EC)  Panel Report, United States – Anti-Dumping Act of 1916, Complaint by the 
European Communities , WT/DS136/R and Corr.1, adopted 26 September 2000, 
upheld by Appellate Body Report, WT/DS136/AB/R, WT/DS162/AB/R, 
DSR 2000:X, 4593 
US – 1916 Act (Japan)  Panel Report, United States – Anti-Dumping Act of 1916, Complaint by Japan , 
WT/DS162/R and Add.1, adopted 26 September 2000, upheld by Appellate Body Report, WT/DS136/AB/R, WT/DS162/AB/R, DSR 2000:X, 4831 
US – Canadian Pork  GATT Panel Report, United States – Countervailing Duties on Fresh, Chilled 
and Frozen Pork from Canada , DS7/R, adopted 11 July 1991, BISD 38S/30 
US – Certain EC Products  Appellate Body Report, United States – Import Measures on Certain Products 
from the European Communities , WT/DS165/AB/R, adopted 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 , 
WT/DS244/AB/R, adopted 9 January 2004, DSR 2004:I, 3  
US –  Customs Bond Directive Panel Report, United States – Customs Bond Directive for Merchandise Subject 
to Anti-Dumping/Countervailing Duties , WT/DS345/R, circulated to WTO 
Members 29 February 2008  
US – Gambling Appellate Body Report, United States – Measures Affecting the Cross-Border 
Supply of Gambling and Betting Services , WT/DS285/AB/R, adopted 20 April 
2005, DSR 2005:XII, 5663, and Corr.1 
US – Hot-Rolled Steel  Appellate Body Report, United States – Anti-Dumping Measures on Certain  
Hot-Rolled Steel Products from Japan , WT/DS184/AB/R, adopted 23 August 
2001, DSR 2001:X, 4697 
US – Offset Act  
(Byrd Amendment ) Appellate Body Report, United States – Continued Dumping and Subsidy Offset 
Act of 2000 , WT/DS217/AB/R, WT/DS234/AB/R, adopted 27 January 2003, 
DSR 2003:I, 375 
US – Oil Country Tubular 
Goods Sunset Reviews Appellate Body Report, United States – Sunset Reviews of Anti-Dumping 
Measures on Oil Country Tubular Goods from Argentina , WT/DS268/AB/R, 
adopted 17 December 2004, DSR 2004:VII, 3257 
US – Section 129(c)(1) URAA  Panel Report, United States – Section 129(c)(1) of the Uruguay Round 
Agreements Act , WT/DS221/R, adopted 30 August 2002, DSR 2002:VII, 2581 
US – Shrimp (Thailand) Panel Report, United States – Measures Relating to Shrimp from Thailand , 
WT/DS343/R, circulated to WTO Members 29 February 2008 
US – Softwood Lumber V  Appellate Body Report, United States – Final Dumping Determination on 
Softwood Lumber from Canada , WT/DS264/AB/R, adopted 31 August 2004, 
DSR 2004:V, 1875 
US – Stainless Steel (Mexico) Appellate Body Report, United States – Final Anti-Dumping Measures on 
Stainless Steel from Mexico , WT/DS344/AB/R, adopted 20 May 2008 WT/DS343/AB/R 
WT/DS345/AB/R Page vi 
 
 
Short Title Full Case Title and Citation 
US – Upland Cotton Appellate Body Report, United States – Subsidies on Upland Cotton , 
WT/DS267/AB/R, adopted 21 March 2005, DSR 2005:I, 3 
US – Wool Shirts and Blouses  Appellate Body Report, United States – Measure Affecting Imports of Woven 
Wool Shirts and Blouses from India , WT/DS33/AB/R, adopted 23 May 1997, and 
Corr.1, DSR 1997:I, 323  
US – Zeroing (EC) Appellate Body Report, United States – Laws, Regulations and Methodology for 
Calculating Dumping Margins ("Zeroing") , WT/DS294/AB/R, adopted 9 May 
2006, and Corr.1, DSR 2006:II, 417 
US – Zeroing (EC) Panel Report, United States – Laws, Regulations and Methodology for 
Calculating Dumping Margins ("Zeroing") , WT/DS294/R, adopted 9 May 
2006, as modified by Appellate Body Report, WT/DS294/AB/R, DSR 2006:II, 
521 
US – Zeroing (Japan) Appellate Body Report, United States – Measures Relating to Zeroing and 
Sunset Reviews , WT/DS322/AB/R, adopted 23 January 2007 
 
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 WT/DS345/AB/R 
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ABBREVIATIONS USED IN THIS REPORT 
 
Abbreviation Description 
1959 Group of Experts 
Report  GATT Report of the Group of Experts, Anti-Dumping and 
Countervailing Duties, GATT documen t L/978, adopted 13 May 1959, 
BISD 8S/151  
1960 Group of Experts 
Report GATT Second Report of the Group of Experts, Anti-Dumping and 
Countervailing Duties, GATT Document L/1141, adopted 27 May 
1960, BISD 9S/194 
1991 Directive  Customs Directive on Monetary Guidelines for Setting Bond 
Amounts, No. 099-3510-004 (23 July 1991) amended 9 July 2004 (Exhibits THA-1 and IND-2)  
Ad Note Ad Note to Article VI:2 and 3 of the GATT 1994  
Amended CBD Amended Customs Bond Directive – collectively, the July 2004 
Amendment, the Current Bond Formulas, the August 2005 Clarification, and the October 2006 Notice 
Antidumping Act of 1916  Title VIII (under the heading "Unfair Competition") of the United States 
Revenue Act of 1916, 39 Stat. 756 (1916) 
Antidumping Act of 1921 United States Antidumping Act of 1921, 42 Stat. 11, codified under 
United States Code , Title 19, as amended 
Anti-Dumping Agreement Agreement on Implementati on of Article VI of the General Agreement 
on Tariffs and Trade 1994 
August 2005 Clarification United States Custom s, "Clarification to July 9, 2004 Amended 
Monetary Guidelines for Setting Bond Amounts for Special Categories of Merchandise Subject to Antidumping and/or 
Countervailing Duty Cases" (Exhibits THA-4 and IND-5) 
Basic bond requirement Basic requirements listed for a continuous bond as set out in the 1991 
Directive 
Current Bond Formulas United States Custom s document entitled "Current Bond Formulas" 
dated 25 January 2005 (Exhibits THA-3 and IND-4) 
DDP Delivery Duty Paid 
DSB Dispute Sett lement Body 
DSU Understanding on Rules and Procedures Governing the Settlement of 
Disputes  
EBR Enhanced continuous bond requirement 
GATT 1994 General Agreement on Tariffs and Trade 1994  
July 2004 Amendment United States Customs, "Amendment to Bond Directive 99-3510-004 
for Certain Merchandise Subject to Antidumping/Countervailing Cases" (9 July 2004) (Exhibits THA-2 and IND-3) 
October 2006 Notice United States Customs,  "Monetary Guidelines for Setting Bond 
Amounts for Importations Subject to Enhanced Bonding Requirements", United States Federal Register , Vol. 71, No. 205 
(24 October 2006), Notices (Exhibits THA-5 and IND-6) WT/DS343/AB/R 
WT/DS345/AB/R Page viii 
 
 
Abbreviation Description 
Panel Panels in United States – Measures Re lating to Shrimp from Thailand  
and United States – Customs Bond Dire ctive for Merchandise subject to 
Anti-Dumping/Countervailing Duties 
Panel Report, US – Customs 
Bond Directive Panel Report, United States – Customs Bond Directive for 
Merchandise Subject to Anti-Dumping/Countervailing Duties , 
WT/DS345/R 
Panel Report, US –Shrimp 
(Thailand) Panel Report, United States – Measures Relating to Shrimp from 
Thailand , WT/DS343/R 
SCM Agreement Agreement on Subsidies and Countervailing Measures  
Subject shrimp Frozen warmwater shrimp subject to anti-dumping duties 
Tariff Act  United States Tariff Act of 1930, Public Law No. 1202-1527, 46 Stat. 
741, codified under United States Code , Title 19, as amended  
United States Customs United States Customs and Border Protection 
United States Regulations United States Code of Federal Regulations 
USCIT United States Court of International Trade 
USDOC United States Department of Commerce 
USGAO United States Government Accountability Office  
USGAO Report USGAO Report, Customs' Revised Bonding Policy Reduces Risk of 
Uncollected Duties, but Concern s about uneven Implementation and 
Effects Remain , GAO-07-50 (Washington DC, October 2006) 
(Exhibits THA-10 and IND-26) 
USITC United States International Trade Commission 
Vienna Convention Vienna Convention on the Law of Treaties , done at Vienna, 23 May 
1969, 1155 UNTS 331;  8 International Legal Materials 679 
WTO World Trade Organization 
WTO Agreement Marra kesh Agreement Establishing the World Trade Organization   
 
   WT/DS343/AB/R 
 WT/DS345/AB/R 
 Page 1 
 
 
WORLD TRADE ORGANIZATION  
APPELLATE BODY 
 
 
United States – Measures Relating to Shrimp 
from Thailand  
United States – Customs Bond Directive for 
Merchandise Subject to Anti-Dumping/ Countervailing Duties  
 
Thailand, Appellant /Appellee/Third Participant 
India, Appellant /Appellee /Third Participant 
United States, Appellant/Appellee 
 
Brazil, Third Participant 
Chile, Third Participant 
China, Third Participant 
European Communities, Third Participant 
Japan, Third Participant 
Korea, Third Participant 
Mexico, Third Participant 
Viet Nam, Third Participant   AB-2008-3 
  
 AB-2008-4 
     Present: 
 
Sacerdoti, Presiding Member Baptista, Member Ganesan, Member 
 
  
I. Introduction 
1. Thailand, India, and the United States each appeals certain issues of law and legal 
interpretations develope d in the Panel Reports, United States – Measures Relating to Shrimp from 
Thailand
 1 ("Panel Report, US – Shrimp (Thailand) ") and United States – Customs Bond Directive for 
Merchandise Subject to Anti-Dumping/Countervailing Duties 2 ("Panel Report, US – Customs Bond 
Directive ").  Two Panels were establis hed to consider complaints by Thailand and by India 
concerning the application of an enhanced con tinuous bond requirement (the "EBR") by the United 
States on imports of frozen warmwater shrimp that  were subject to anti-dumping duties ("subject 
shrimp").3  As the claims brought by Thailand and by Indi a in respect of the EBR were substantially 
similar, both Thailand and India requested that the same persons serve as panelists in their respective 
                                                      
1Complaint by Thailand , WT/DS343/R, 29 February 2008.  
2Complaint by India , WT/DS345/R, 29 February 2008. 
3Panel Report, US – Shrimp (Thailand) , para. 2.1;  Panel Report, US – Customs Bond Directive , 
para. 2.1. WT/DS343/AB/R 
WT/DS345/AB/R Page 2 
 
 
disputes, in accordance with Article 9.3 of the Understanding on Rules and Procedures Governing the 
Settlement of Disputes  ("the DSU").
4  The composition of both Panels was therefore identical.5 
2. The claims brought by Thailand and by India pertained to the EBR imposed by the United 
States on imports of subject shrimp from Thailand and India.6  Another measure, challenged only by 
Thailand in US – Shrimp (Thailand) , involved the use of "zeroing" by the United States' investigating 
authorities when calculating dumping margins on the basis of weighted-average comparisons of 
export prices and normal value in the original an ti-dumping duty investigation on imports of shrimp 
from Thailand.7  The Panel's finding on this issue has not  been appealed by the United States. 
3. The EBR consists of a continuous bond e quivalent to 100 per cent of the anti-
dumping/countervailing duty rate established in the original anti-dumping/countervailing duty order, 
or the most recent administrative review, multiplied by the value of imports made by the importer 
during the previous 12 months.8  This enhanced bond is required in addition to the basic bond amount 
equivalent to the greater of US$50, 000 or 10 per cent of the duties,  taxes, and fees paid during the 
preceding year, and to the entry "cash deposits " that are required under the United States' 
retrospective duty assessment system.9  The EBR has been imposed pursuant to Customs Directive 
                                                      
4Panel Report, US – Shrimp (Thailand) para. 1.7;  Panel Report, US – Customs Bond Directive , 
para. 1.7.  Although the Panels' working procedures were harmonized (See Panel Report, US – Shrimp 
(Thailand) para. 1.10;  and Panel Report, US – Customs Bond Directive , para. 1.10), separate reports were 
issued.   
5As the composition of both Panels was identical, we will refer to the Panels in this Report collectively 
as the "Panel". 
6Panel Report, US – Shrimp (Thailand) , para. 2.5;  Panel Report, US – Customs Bond Directive , 
para. 2.2. 
7Panel Report, US – Shrimp (Thailand) , paras. 7.9-7.36 and 8.2. 
8More details on the EBR are provided in Section IV.B.3 of this Report.  
9More details on the United States' retrospective duty assessment system are provided in 
Section IV.B.1 of this Report.    WT/DS343/AB/R 
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No. 099-3510-004 on Monetary Guidelines for Settin g Bond Amounts issued on 23 July 199110 (the 
"1991 Directive"), as amended by the document s and instruments constituting the "Amended CBD".11 
4. Pursuant to the Amended CBD12, United States Customs and Border Protection ("United 
States Customs") amended its existing bond requi rements to include new guidelines for "covered 
cases" within "special categories" of merchandise.  To date, "agriculture/aquaculture merchandise" is 
the only merchandise designated as a "special categ ory", and "shrimp covered by anti-dumping or 
countervailing duty cases" is the only "covered case" desi gnated within that category.  On 1 February 
2005, United States Customs implemented the EBR w ith respect to subject shrimp.  Thereafter, 
United States Customs began requiring subject shrimp importers to maintain e nhanced bond coverage.   
5. Before the Panel, both Thailand and India raised  "as applied" claims under Article 18.1 of the 
Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 , (the 
"Anti-Dumping Agreement ") regarding the application of the EBR to subject shrimp.  Article 18.1 of 
the Anti-Dumping Agreement provides that " [n]o specific action against dumping of exports from 
another Member can be taken except in accordance with the provisions of the GATT 1994, 
as interpreted by this Agreement ."13  The parties referred to Article VI of the General Agreement on 
Tariffs and Trade 1994  (the  "GATT 1994"), as well as the Ad Note to Article VI:2 and 3 of the 
                                                      
10United States Customs Directive on Monetary Gu idelines for Setting Bond Amounts, No. 099-3510-
004 (23 July 1991) (Exhibits THA-1 and IND-2 submitted by Thailand and India, respectively, to the Panel). 
11The documents constituting the "Amended CBD" comprise: 
− United States Customs, "Amendment to Bond Di rective 099-3510-004 for Certain Merchandise 
Subject to Antidumping/Countervailing Duty Cases" (9 July 2004) (the "July 2004 Amendment") 
(Exhibits THA-2 and IND-3 submitted by Thailand  and India, respectively, to the Panel); 
− United States Customs, "Current Bond Formulas", posted on United States Customs' website 
24 January 2005 (the "Current Bond Formulas") (Exhibits THA-3 and IND-4 submitted by 
Thailand and India, respectively, to the Panel);  
− United States Customs, "Clarification to July 9, 2004 Amended Monetary Guidelines for Setting 
Bond Amounts for Special Categories of Merchandise Subject to Antidumping and/or 
Countervailing Duty Cases" (the "August 2005  Clarification") (Exhibits THA-4 and IND-5 
submitted by Thailand and India, respectively, to the Panel);  and 
− United States Customs, "Monetary Guidelines for Setting Bond Amounts for Importations 
Subject to Enhanced Bonding Requirements", United States Federal Register , Vol. 71, No. 205 
(24 October 2006), Notices (the "October 2006  Notice") (Exhibits THA-5 and IND-6 submitted 
by Thailand and India, respectively, to the Panel).  
(See Panel Report, US – Shrimp (Thailand) , para. 2.5;  and Panel Report, US – Customs Bond Directive , 
para. 2.2)  More details on the Amended CBD are provided in Section IV.B.3 of this Report. 
12See supra , footnote 11. 
13Footnote omitted;  emphasis added. WT/DS343/AB/R 
WT/DS345/AB/R Page 4 
 
 
GATT 1994
14 (the " Ad Note"), as the relevant provisions of the GATT 1994 for purposes of 
Article 18.1 of the Anti-Dumping Agreement . 
6. Thailand and India each claimed that the application  of the EBR to imports of subject shrimp 
constitutes "specific action against dumping" w ithin the meaning of Article 18.1 of the Anti-Dumping 
Agreement  and is therefore impermissible.  In response, the United States argued that the EBR is not a 
"specific action against dumping" and that, in any event, the EBR constitutes "reasonable security" 
within the scope of the Ad Note to Article VI:2 and 3 of the GATT 1994.   
7. The Panel Reports were circulated to Members of the World Trade Organization (the "WTO") 
on 29 February 2008.  The Panel examined first whet her the application of the EBR to subject shrimp 
constitutes "specific action against dumping" within th e meaning of Article 18.1.  It found that the 
EBR is "specific action" in response to dumping because it is "inextricably linked to or has a strong 
correlation with the constituent elements of dumping" , in the sense that it can be applied only to goods 
that are subject to a United States anti-dumping duty order, and because the formula set forth in the Amended CBD for calculating the EBR includes a di rect reference to the anti-dumping duty rate.  
Furthermore, the Panel found that the EBR cons titutes action "against" dumping because it has an 
adverse impact on dumping and results in additiona l costs to exporters and producers.  The United 
States has not appealed the finding of the Panel that  the application of the EBR constitutes a "specific 
action against dumping" within the meaning of Article 18.1 of the Anti-Dumping Agreement . 
8. The Panel turned next to consider whether the EBR had been taken "in accordance with the 
provisions of the GATT 1994", in particular, with the Ad Note.  In so doing, the Panel first examined 
the relationship between the Ad Note and the Anti-Dumping Agreement .  It found that the two 
Agreements should not be read to preclude the Ad Note from authorizing certain types of security that 
are not expressly foreseen by the Anti-Dumping Agreement .  Further, the Panel interpreted that, 
contrary to the arguments of Thailand and India, the temporal scope of the Ad Note is not limited to 
the period up to the imposition of the definitive anti- dumping duty order;  instead, that scope extends 
to the period after the imposition of the order as well.
15   
                                                      
14The Ad Note to Article VI:2 and 3 of the GATT 1994 provides, in relevant part: 
As in many other cases in customs administration, a contracting party may 
require reasonable security (bond or cash deposit)  for the payment of anti-
dumping or countervailing duty pending final determination of the facts in any case of suspected dumping or subsidization. (emphasis added) 
15Panel Report, US – Shrimp (Thailand) , para. 7.137;  Panel Report, US – Customs Bond Directive  
para. 7.114.  WT/DS343/AB/R 
 WT/DS345/AB/R 
 Page 5 
 
 
9. However, the Panel found that the EBR, as applie d, is not in conformity with the requirement 
in the Ad Note that the security be "reasonable".  Th e Panel considered that there would be an 
appropriate basis for applying an increased secu rity such as the EBR only if it was properly 
determined that the rates of dumping provided for in the anti-dumping duty order were likely to 
increase, and the likely amount of such increase.16   According to the Panel, without this type of 
analysis, the rate in the anti-dumping duty order re mains the best and only available baseline proxy of 
duties that ultimately may be assessed, and security exceeding this estimate would not be "reasonable" 
within the meaning of the Ad Note.17  The Panel found that the United States had failed to establish 
that the rates of dumping provided for in the anti-dumping duty order were likely to increase.  The Panel therefore concluded that the additional secur ity requirements resulting from the application of 
the EBR are not "reasonable" within the meaning of the Ad Note.
18  For the purposes of Article 18.1 
of the Anti-Dumping Agreement , the application of the EBR is th erefore not in accordance with the 
provisions of the GATT 1994, as interpreted by the Anti-Dumping Agreement .19  As a result, the Panel 
found that the application of the EBR to subject sh rimp is inconsistent w ith Article 18.1 of the Anti-
Dumping Agreement  and the Ad Note.20   
10. The Panel rejected the defence raised by the United States under Article XX(d) of the 
GATT 1994 because the United States had not establis hed that anti-dumping duties were likely to 
increase above the cash deposit rates.  The Panel th erefore considered that the additional security 
provided through the application of the EBR could not  be viewed as "necessar y" within the meaning 
of Article XX(d).   
11. Both Thailand and India made "as applied" claims under various provisions of Articles 7 
and  9 of the Anti-Dumping Agreement  and Article VI:2 of the GATT 1994.  Thailand  made 
"subsidiary and alternative" "as applied" claims under Articles 7.1, 7.2, 7.4, and 7.5 of the Anti-
Dumping Agreement , as well as under Articles 9.1, 9.2, and 9.3 of the Anti-Dumping Agreement  and 
Article VI:2 and the Ad Note of the GATT 1994, in the event that the Panel did not find in its favour 
regarding its Article 18.1 claim.  In the light of  its findings in respect of Thailand's Article 18.1 
                                                      
16Panel Report, US – Shrimp (Thailand) , para. 7.141;  Panel Report, US – Customs Bond Directive , 
para. 7.118. 
17Ibid. 
18Panel Report, US – Shrimp (Thailand) , para. 7.150;  Panel Report, US – Customs Bond Directive , 
para. 7.128.  
19Panel Report, US – Shrimp (Thailand) , para. 7.151;  Panel Report, US – Customs Bond Directive , 
para. 7.129. 
20Panel Report,  US – Shrimp (Thailand) , paras. 7.152 and 8.1;  Panel Report, US – Customs Bond 
Directive , paras. 7.130 and 8.2(i).  In US – Customs Bond Directive , the Panel  "likewise" accepted India's 
related claim that the application of  the EBR violated Article 1 of the Anti-Dumping Agreement . (Panel Report, 
US – Customs Bond Directive , paras. 7.131 and 8.2(i)) WT/DS343/AB/R 
WT/DS345/AB/R Page 6 
 
 
claims, the Panel considered it unnecessary to address those claims of Thailand.
21  India also claimed 
that the application of the EBR is inconsiste nt with the requirements of Article 7 of the Anti-Dumping 
Agreement , which governs provisional measures taken afte r a preliminary affirmative determination 
has been made, as well as various pr ovisions under Article 9 of the Anti-Dumping Agreement  and 
Article VI:2 of the GATT 1994.  The Panel concl uded that the application of the EBR on subject 
shrimp prior to the imposition of the definitive or der, in addition to certain provisional measures, 
resulted in the imposition of provisional measures  that were "in excess of  the duty provisionally 
estimated", in violation of Article 7.2 of the Anti-Dumping Agreement 22, but exercised judicial 
economy with respect to India's claims under Articles 7.1(iii) and 7.4.23  The Panel however rejected 
India's claims under Articles 9.1, 9.2, 9.3, and 9.3.1 of the Anti-Dumping Agreement  and Article VI:2 
of the GATT 1994.24  
12. The Panel refrained from deciding the other "as applied" claims made by both Thailand and 
India that the EBR is inconsistent with certain GATT 1994 Articles, including Articles I:1, II:1(a) and (b), X:3(a), XI:1, and XIII.
25   
13. In addition, India claimed that the Amended CBD "as such" violates Articles 1 and 18.1 of the 
Anti-Dumping Agreement and Articles 10 and 32.1 of the Agreement on Subsidies and Countervailing 
Measures (the " SCM Agreement ").  Relying on its earlier reasoni ng and findings regarding the "as 
applied" claims under Articles 1 and 18.1 of the Anti-Dumping Agreement  and the Ad Note, the Panel 
dismissed India's "as such" claims under Articles 1 and 18.1 of the Anti-Dumping Agreement  and 
Articles 10 and 32.1 of the SCM Agreement .26  The Panel also rejected India's other "as such" claims 
under Articles 7 and 9 of the Anti-Dumping Agreement  and Article VI.2 of the GATT 1994, as well as 
Articles 17 and 19 of the SCM Agreement and Article VI:3 of the GATT 1994.  The Panel declined, as 
it had done with respect to India's similar "as app lied" claims, to rule on India's claims that the  
                                                      
21Panel Report, US – Shrimp (Thailand) , paras. 7.153 and 7.154. 
22Panel Report, US – Customs Bond Directive , para. 7.146.   
23Ibid., para. 7.147. 
24Ibid., paras. 7.161 and 7.162. 
25See Panel Report,  US – Shrimp (Thailand) , para. 7.155:  "Thailand has made additional claims under 
Article XI:1 and, alternatively, Artic le II:1(a) and the first and second sentences of Article II:1(b), of the 
GATT 1994 ;  and Articles X:3(a) and I of the GATT 1994 ";  and Panel Report, US – Customs Bond Directive , 
para. 7.163:  "India has requested the Panel to find that the EBR as applied  to imports of shrimp from India is 
inconsistent with Article X:3(a) of the GATT 1994  and with Articles I:1, II:1(a) and (b) of the GATT 1994 or, 
alternatively, with Article s XI:1 and XIII of the GATT 1994 ."    
26Panel Report, US – Customs Bond Directive , paras. 7.237 and 7.238.  WT/DS343/AB/R 
 WT/DS345/AB/R 
 Page 7 
 
 
Amended CBD is "as such" inconsistent with Arti cles I, II:1(a) and (b), XI:1 and XIII of the 
GATT 1994.  Finally, the Panel upheld India's claim that the United States had acted inconsistently 
with Article 18.5 of the Anti-Dumping Agreement  and Article 32.6 of the SCM Agreement  by failing 
to notify the Amended CBD to th e Anti-Dumping and SCM Committees. 
14. In the light of these findings, the Panel recommended that the United States bring the 
application of the EBR into conformity  with its WTO obligations under the Anti-Dumping Agreement  
and the GATT 1994.27 
15. On 17 April 2008, Thailand and India both separ ately notified the Dispute Settlement Body 
(the "DSB"), pursuant to paragraph 4 of Article 16 of the DSU, of their intention to appeal certain 
issues of law covered in Panel Report,  US – Shrimp (Thailand)  and Panel Report, US – Customs Bond 
Directive , respectively, and certain legal interpretations  developed by the Panel, and filed separate 
Notices of Appeal28 pursuant to Rule 20 of the Working Procedures for Appellate Review  (the 
"Working Procedures ").29   
16. In a letter dated 21 April 2008, the participants  were informed that Appellate Body Member, 
Mr. A.V. Ganesan, had been selected, on the basis of  rotation, to serve on the Division hearing these 
appeals, and that, in accordance with Rule 15 of the Working Procedures , the Appellate Body had 
notified the Chairman of the DSB of its decision to  authorize Mr. Ganesan to complete the disposition 
of the appeals even though his second term as Appe llate Body Member was to expire before the 
completion of the appellate proceedings.  The Division further noted that, in the interests of "fairness 
and orderly procedure", as referred to in Rule16(1) of the Working Procedures , and in agreement with 
the participants, the appellate proceedings in respect  of the appeals by both Thailand and India would 
be consolidated due to the substan tial overlap in the content of the disputes.  A single Division would 
hear and decide both appeals, and a single oral hear ing would be held by the Division.  Further to a 
request by the United States, and in consultation w ith the participants, the Division extended, pursuant 
to Rule 16(2) of the Working Procedures , the time periods for the filing of the other appellant's 
submissions by the United States, as well as for the filing of appellees' and third participants' 
submissions.  The Division also invited all third parties in US – Shrimp (Thailand)  and US – Customs 
Bonds Directive  to attend the single oral hearing in the consolidated appellate proceedings, noting, 
however, the understanding that, in their written submissions and oral statements, the third 
                                                      
27Panel Report,  US – Shrimp (Thailand) , para. 8.6;  Panel Report, US – Customs Bond Directive , 
para. 8.7. 
28WT/DS343/10 (attached as Annex I to this Report);  WT/DS345/9 (attached as Annex II to this 
Report). 
29WT/AB/WP/5, 4 January 2005. WT/DS343/AB/R 
WT/DS345/AB/R Page 8 
 
 
participants would address only the issues appealed in the dispute(s) to which they were third parties 
in the panel proceedings.   
17. By letter dated 22 April 2008, India requested the Division to extend the time period for filing 
its appellant's submission by one working day, that is, from 24 April to 25 April 2008, pursuant to Rule 16(2) of the Working Procedures , due to certain unforeseen developments.  On the same day, the 
Division invited the participants and third particip ants to comment on India's request by 5 p.m. on 
23 April 2008.  Two comments were received:  Thai land did not object to Indi a's request;  and the 
United States submitted that it would accept India's request provided that the filing dates applicable to 
the United States' submissions w ould be adjusted accordingly.   
18. Having carefully considered India's request a nd the views expressed by the United States and 
Thailand, the Division granted India time until 1 p.m., Geneva time, on 25 April 2008 to file its 
appellant's submission.  Further, in view of th e submission made by the United States, the Division 
also granted the United States time until 1 p.m., Geneva time, on 20 May 2008  to file its appellee's 
submissions.  The same extension was also granted to India and to Thailand to file their appellee's 
submissions and to those third participants wishing to file a submission pursuant to Rule 24(1) or a 
notification pursuant to Rule 24(2) of the Working Procedures . 
19.  On 24 April 2008, Thailand filed an appellant's submission.
30  On 25 April 2008, India filed 
an appellant's submission.31  On 29 April 2008, the United States notified the DSB, pursuant to 
paragraph 4 of Article 16 of the DSU,  of its intention to appeal certa in issues of law covered in the 
Panel Reports and certain legal in terpretation developed by the Pa nel and filed a Notice of Other 
Appeal32 in each dispute pursuant to Rule 23(1) of the Working Procedures .  On 6 May 2008, the 
United States filed an other appellant's submission in each appeal.33  On 19 May 2008, Viet Nam 
notified its intention to appear at th e oral hearing as a third participant.34  On 20 May 2008, Thailand 
and India each filed an appellee's submission and th e United States filed an appellee's submission in 
each appeal.35  On the same day, Brazil, Chile, the Eur opean Communities, India, Japan, Korea, and 
                                                      
30Pursuant to Rule 21 of the Working Procedures .  
31Pursuant to Rules 16(1) and (2) and  21 of the Working Procedures . 
32WT/DS343/11 (attached as Annex III to this Report );  WT/DS345/10 (attached as Annex IV to this 
Report). 
33Pursuant to Rules 16(1) and (2) and 23(3) of the Working Procedures . 
34Pursuant to Rule 24(2) of the Working Procedures .   
35Pursuant to Rules 16(1) and (2), 22, and 23(4) of the Working Procedures .  WT/DS343/AB/R 
 WT/DS345/AB/R 
 Page 9 
 
 
Thailand each filed a third participant's submission36, and China and Mexico each notified its 
intention to appear at the oral hearing as a third participant.37 
20. By letter dated 29 April 2008, India requested authorization from the Division to correct 
certain "clerical errors" in its appellant's submission, pursuant to Rule 18(5) of the Working 
Procedures .  On 30 April 2008, the Division invited all par ticipants and third participants to comment 
on India's request.  None of the participants or thir d participants objected to India's request.  On 7 May 
2008, the Division authorized India to correct the "c lerical errors" in its a ppellant's submission.  
21. The oral hearing in this appeal was held on 28 and 29 May 2008.  The participants and third 
participants presented oral arguments, with the excep tion of Chile, China, Mexico, and Viet Nam, and 
responded to questions posed by the Members of the Appellate Body Division hearing the appeal. 
II. Arguments of the Participants  and the Third Participants 
A. Claims of Thailand – Appellant in US – Shrimp (Thailand) 
1. Ad Note to Article VI:2 and 3 of the GATT 1994  
22. Thailand requests the Appellate Body to re verse the Panel's interpretation of the Ad Note to 
Article VI:2 and 3 of the GATT 1994, and to clarify that the Ad Note does not authorize the 
application of security requirements after defin itive anti-dumping duty measures have been imposed.  
Specifically, Thailand objects to the Panel's interp retation of the phrase "pending final determination 
of the facts in any case of suspected dumping" occurring in the Ad Note.  Thailand considers that the 
temporal scope of this phrase is limited to the tim e period before the existence of dumping has been 
established in an investigation conducted pursuant to Article 5 of the Anti-Dumping Agreement , and 
that the Panel's interpretation of the Ad Note is inconsistent with the ordinary meaning of the phrase 
read in the context of Article VI of the GATT 1994 and the Anti-Dumping Agreement .  
23. Thailand also disagrees with the Panel's interpretation that a finding of dumping in an 
investigation under Article 5 of the Anti-Dumping Agreement  gives rise only to a "suspicion of 
dumping" with respect to individual transactions occurring after the imposition of an anti-dumping  
                                                      
36Pursuant to Rule 24(1) of the Working Procedures .  On 26 May 2008, the participants and the third 
participants were provided an English translation, prepared by the WTO Language Services and Documentation 
Division, of Chile's third participant's submission, filed originally in Spanish on 20 May 2008. 
37Pursuant to Rule 24(2) of the Working Procedures .   WT/DS343/AB/R 
WT/DS345/AB/R Page 10 
 
 
duty order.
38  In Thailand's view, the text of Article  VI of the GATT 1994, as well as the context 
provided by Articles 2.1, 3.5, 3.7, and 14.2 of the Anti-Dumping Agreement , confirm that dumping is 
a present, continuous, and ongoing state of affairs, and that, therefore, a finding of dumping in an 
investigation under Article 5 also covers indivi dual transactions after the imposition of an anti-
dumping duty order.  For Thailand, an investigation that establishes dumping does so in relation to the 
transactions occurring during the investigation, as well as with respect to future imports of the subject 
product, and dumping, therefore, cannot be merely "s uspected" with respect to the future imports. 
24. According to Thailand, the Ad Note was introduced merely to interpret and clarify the 
provisions of Article VI:2 and 3 of the GATT 1994.  Thailand reasons that, since the only 
determination referred to in those provisions is th e finding of dumping and injury within the meaning 
of Article VI:1, 2, and 6 necessary to authori ze the imposition of anti-dumping duties, the term 
"pending final determination of the facts in any case of suspected dumping" in the Ad Note must be 
read to refer to the period before such a finding is made.  Furthermore, Thailand points out that 
Article 5.1 of the Anti-Dumping Agreement  mandates procedures for an investigation into whether 
dumping exists  and "is taking place", and that, following su ch a determination and the imposition of 
definitive anti-dumping duties, dumping is no longer "suspected" but is considered to be occurring, 
even if the final amount of anti-dumping liability is still undetermined. 
25. Thailand submits that Article 7 of the Anti-Dumping Agreement  on provisional measures 
subsumes and governs the application of the Ad Note.  In support of this position, Thailand underlines 
the use of similar language in Article 7 and in the Ad Note to describe the type of action authorized.  It 
also refers to a second report prepared in 196039 by the Group of Experts on Anti-Dumping and 
Countervailing Duties (the "1960 Group of Experts Re port") in which the term "suspect[ed]" in the 
Ad Note is used to refer to only the period for which provisional measures could be used.40  F o r  
Thailand, "it is clear that the Group of Experts, in recommending [in its first report] the adoption of 
rules governing provisional measures that  eventually became Article 7 [of the Anti-Dumping 
Agreement ], expressly considered itself to be implementing the Ad Note."41  
                                                      
38Thailand's appellant's submission, US – Shrimp (Thailand) , para. 29 (referring to Panel Report, US – 
Shrimp (Thailand) , para. 7.105). 
39GATT Second Report of the Group of Expert s, Anti-Dumping and Countervailing Duties, GATT 
document L/1141, adopted 27 May 1960, BISD 9S/194. 
40See 1960 Group of Experts Report, supra , footnote 39, para. 15. 
41Thailand's appellant's submission,  US – Shrimp (Thailand) , para. 56 (referring to GATT Report of the 
Group of Experts, Anti-Dumping and Countervailing Dutie s, GATT document L/978, adopted 13 May 1959, 
BISD 8S/151, (the "1959 Group of Experts Report"), para. 19).  WT/DS343/AB/R 
 WT/DS345/AB/R 
 Page 11 
 
 
26. Thailand further points out that the Panel's interpretation of the Ad Note is erroneous when 
read in the context of Article 9 of the Anti-Dumping Agreement , which governs the imposition and 
collection of anti-dumping duties.  Many provisions of the Anti-Dumping Agreement , including 
Articles 8.642, 10.343, 10.644, 11.245, and 11.346 refer to the duties imposed pursuant to Article 9.1 as 
"definitive" duties.  Thailand submits that, wh en the United States imposes an anti-dumping duty 
order following the completion of an investigation under Article 5 and following affirmative findings 
of dumping and injury, it makes a decision to impose definitive anti-dumping  duties under Article 9.1.  
Thailand reasons that, to the extent that Article 9. 1 and Article VI provide that definitive duties may 
be imposed only after a finding of dumping and injury, a case of "suspected dumping" within the 
meaning of the Ad Note cannot continue to exist after the decision has been made to impose such 
definitive anti-dumping duties. 
27. Thailand disagrees with the Panel's reasoni ng that a "case of suspected dumping" may 
continue to exist after the imposition of definitive anti-dumping duties, because, in the United States' 
retrospective duty assessment system, the amount of  liability is not finally determined until the 
completion of an assessment review (also ca lled a "periodic review") under Article 9.3.1.47  F o r  
Thailand, the Anti-Dumping Agreement "draws a clear textual distinc tion between (i) determinations 
that affect the existence of dumping, and injury and, therefore, the authority to impose and maintain 
measures to offset such dumping and (ii) determin ations under Article 9.3 re garding the subsidiary 
issue of the amount of duties to be paid".48  In this respect, Thailand refers to footnote 22 to the Anti-
Dumping Agreement , which provides that "a finding in the most recent assessment proceeding under 
subparagraph 3.1 of Article 9 that no duty is to be levied shall not by itself require the authorities to 
terminate the definitive duty."  According to Thailand , this means that a product is considered to be 
dumped even if the amount of the final liability for a par ticular period is determined to be zero.  It also 
means that the determination of the amount of fina l liability under Article 9.3.1 or Article 9.3.2 is 
subsidiary to the determination of  the existence of dumping and that, therefore, it is not the "final 
determination of the facts in any case of suspected dumping" referred to in the Ad Note.   
                                                      
42Article 8.6 provides that "definitive duties" may be levied retrospectively in cases of violation of 
price undertakings. 
43Article 10.3 begins with the words:  "If the definitive anti-dumping duty is higher than the provisional 
duty ...". 
44Article 10.6 begins with the words:  "A de finitive anti-dumping duty may be levied ...". 
45Article 11.2 refers explicitly to the "imposition of the definitive anti-dumping duty". 
46Article 11.3 provides that "any definitive anti-dumping duty shall be terminated on a date not later 
than five years from its imposition". 
47Thailand's appellant's submission,  US – Shrimp (Thailand) , para. 62 (referring to Panel Report, US – 
Shrimp (Thailand) , para. 7.103). 
48Ibid., para. 64. (original emphasis) WT/DS343/AB/R 
WT/DS345/AB/R Page 12 
 
 
28. Thailand also argues that the Panel failed to  take properly into account the fact that 
assessment reviews under Articles 9.3.1 and 9.3.2 ar e not mandatory and may not even take place, 
because such reviews are conducted only upon "re quest".  For Thailand, the drafters of the Anti-
Dumping Agreement  could not have intended the "final determination of the facts" under the Ad Note 
to refer to a determination that is  contingent upon a request from an interested party.  Thailand 
contends that the Panel erred because it treated a fi nal determination of duty liability, which may or 
may not be made depending on whether an assessment review is requested, as the "final determination 
of the facts" within the meaning of the Ad Note. 
29. Further, Thailand points out that the Appellate B ody has consistently held that Article VI of 
the GATT 1994 and the Anti-Dumping Agreement  limit the permissible responses to dumping to three 
measures only:  namely, provisional measures, price undertakings, and definitive measures.
49  
According to Thailand, the Pa nel's interpretation of the Ad Note is not consistent with this finding of 
the Appellate Body because it implies that a requirement to provide reasonable security after the conclusion of the investigation is a fourth perm issible response to dumping within the meaning of 
Article 18.1 of the Anti-Dumping Agreement .  The Panel's interpretation also goes against the 
disciplines of Article VI of the GATT 1994 and the Anti-Dumping Agreement , because the Ad Note 
would then permit specific action against dumping in the form of a security in the amount of a likely 
future  dumping margin, whereas, in Thailand's view, "[n] othing in the text of Article VI or the [ Anti-
Dumping ] Agreement  remotely supports the idea that the Ad  Note authorises specific action against 
dumping on the basis of future  dumping margins."
50  According to Thailand, the only remedy foreseen 
by Article VI or the Anti-Dumping Agreement  is the imposition of duties to offset present dumping.  
Nothing in these provisions suggests that action against dumping may be based on margins of dumping that may (or may not) be found to exist in the future.   
30. Thailand considers that its interpretation of the Ad Note would not prevent the United States 
from taking action under Article XX(d) of the GATT 1994 to require necessary security in cases 
where there is an importer-specific risk of non-collec tion of duties.  According to Thailand, Article VI 
confers the right to impose anti-dumping duties, but  does not permit any other remedy to counteract 
dumping, and, therefore, any action to enforce the collection of those duties must be taken under Article XX(d) rather than as "specific action agains t dumping" within the meaning of Article 18.1. 
                                                     
 
49Thailand's appellant's submission,  US – Shrimp (Thailand) , para. 79 (referring to Appellate Body 
Report, US – 1916 Act , para. 137;  and Appellate Body Report, US – Offset Act (Byrd Amendment) , paras. 264 
and 265). 
50Ibid., para. 85. (original emphasis)  WT/DS343/AB/R 
 WT/DS345/AB/R 
 Page 13 
 
 
31. Thailand therefore requests the Appellate Body to  reverse the Panel's legal interpretation of 
the phrase "pending final determination of the facts in any case of suspected dumping" in the Ad Note, 
and to find, instead, that the phrase means that the facts will be finally determined and "a case of 
suspected dumping" will no longer exist once a Me mber has imposed definitive anti-dumping duties 
under Article 9.1 of the Anti-Dumping Agreement  following a determination of injurious dumping in 
an investigation conducted under Article 5 of the Anti-Dumping Agreement . 
2. Cash Deposits and Anti-dumping Duties  
32. Thailand challenges the Panel's interpretati on that, under the retrospective duty assessment 
system of the United States, cash deposits are not anti-dumping duties and that they are not duties 
imposed pursuant to Article 9 of the Anti-Dumping Agreement .  Relying on references to the term 
"anti-dumping duties" in various provisions of the Anti-Dumping Agreement , Thailand argues that 
anti-dumping measures imposed further to the conclusi on of an investigation under Article 5 are anti-
dumping duties for the purposes of the Anti-Dumping Agreement .51 
33. Thailand further points out that the imposition of the cash deposit requirement on subject 
shrimp from Thailand in the amount of the establis hed margin of dumping was notified to the WTO 
by the United States as a "final measure" and a "definitive duty".52  This supports Thailand's 
interpretation that cash deposits are anti-dumping duties within the meaning of Article 9 of the Anti-
Dumping Agreement .  
                                                      
51Thailand's appellant's submission,  US – Shrimp (Thailand) , para. 116.  Thailand first points to 
Article VI of the GATT 1994  and Article 9.1 of the Anti-Dumping Agreement ;  both provisions  authorize 
Members to impose definitive anti-dumping duties "in cases where all requirements for the imposition have been fulfilled". ( Ibid., para. 109)  Thailand also refers to the "lesse r duty rule" in Article 9.1, which refers to "the 
decision whether the amount of the anti-dumping duty to be imposed shall be the full margin of dumping or 
less". ( Ibid., para.110)  Thailand underlines that Article 9.2 twice refers to an anti-dumping "duty" being 
imposed and collected, and that the "amount of the anti-dumping duty" in Article 9.3 is not qualified in any way. 
(Ibid., para.111)  Thailand quotes Article 10.1 of the Anti-Dumping Agreement , which provides, inter alia , that 
"anti-dumping duties" are "applied to products which ente r for consumption after the time when the decision 
taken under ... paragraph 1 of Article 9 ... enters into force";  Article 10.4, which refers to an "anti-dumping 
duty" being "imposed only from the date of the determinatio n of threat of injury";  Article 11.1, which provides 
that an "anti-dumping duty shall remain in force only as long as and to the extent necessary to counteract dumping which is causing injury";  Article 11.2, which re fers to the "imposition of the definitive anti-dumping 
duty", the "continued imposition of the duty", and to what would happen "if the duty were removed or varied";  
Article 11.3, which states that "any definitive anti-dumping duty shall be terminated on a date not later than five 
years from its imposition";  as well as Article 12.2.2, whic h refers to an "affirmative determination providing for 
the imposition of a definitive duty". ( Ibid., paras. 112-115)  In Thailand's view, all these provisions show that 
any anti-dumping measure imposed or anti-dumping action taken further to the conclusion of an anti-dumping 
investigation under Article 5 of the Anti-Dumping Agreement —under United States law, this would be after the 
imposition of an anti-dumping duty order —is a duty  for the purposes of the Anti-Dumping Agreement . (Ibid., 
para. 115) 
52Ibid., (referring to the United States' Semi-Annual Report under Article 16.4 of the Agreement to the 
Committee on Anti-Dumping Practices, G/ADP/N/132/USA, 16 September 2005).  WT/DS343/AB/R 
WT/DS345/AB/R Page 14 
 
 
34. Further, the Panel appears to think that, because United States law refers to "cash deposits of 
estimated antidumping duties", and Article 7 of the Anti-Dumping Agreement  refers to "cash deposits" 
as security for provisional measures, the cash depos its collected by the United States must be a 
security, not a duty.  Thailand argues that such reaso ning is incorrect, because Article 7 has a limited 
temporal scope and it refers only to provisional m easures during the investigation stage.  Thailand 
adds that the manner in which a measure is charac terized under domestic law is not determinative of 
its classification under WTO law.  Therefore, the u se of the term "cash deposits" by the United States, 
when referring to the amounts it collects on entries of goods subject to an anti-dumping duty order, 
cannot mean that the amounts so collected are not "duties". 
35. Thailand contends that, even when examined in  the light of the domestic law of the United 
States, cash deposits are "duties" within the meaning of the Anti-Dumping Agreement .  Under United 
States law, the cash deposits required after the publ ication of the anti-dumping duty order are cash 
deposits "of estimated antidumping duties".
53  By contrast, United States law governing provisional 
measures uses the same terminology as Article 7 of the Anti-Dumping Agreement , and describes 
provisional measures as "cash deposit, bond, or other security"54, with no reference to the term 
"estimated duties".  Thailand maintains that this diffe rence in language is consis tent with its view that 
the Anti-Dumping Agreement  draws a distinction between provisional measures imposed under 
Article 7 and definitive anti-dumping duties imposed unde r Article 9.  Thailand adds that the ordinary 
meaning of a deposit  of  a duty is that it is itself a duty, even if it is not the full amount of the duty 
that may eventually be levied, and that it cannot be re-cast into a security  for  a duty. 
36. Thailand also argues that the Panel erred when  it considered that cash deposits have no 
intrinsic value.  According to Thailand, since ca sh deposits of estimated anti-dumping duties are paid 
in cash and that money is fungible, they have the same cash value to the importing Member as any other payment of duties or any other payment of c ash.  Thailand argues that, because a cash deposit of 
estimated duties secures payment of only the amount of the deposit (it does not secure any subsequent 
additional liability), it cannot  properly fulfil the function of a secur ity.  For Thailand, this indicates 
that the United States' cash deposits of estimated duties are duties, not securities. 
37. Thailand considers that the cash deposits are du ties because their function is to offset or 
counteract injurious dumping.  Thailand emphasiz es that dumping takes place and is counteracted at 
                                                     
 
53Thailand's appellant's submission,  US – Shrimp (Thailand) , para. 122 (referring to United States 
Tariff Act of 1930, Public Law No. 1202-1527, 46 Stat. 741, codified under United States Code , Title 19, as 
amended (the "Tariff Act"), Section 1673e(a)(3)).  This provision of the Tariff Act requires that "the deposit of 
estimated antidumping duties pending liquidation of entries of merchandise at the same time as estimated 
normal customs duties on that merchandise are deposited." 
54Ibid., (referring to Tariff Act, supra , footnote 53, Section 1673b(d)(2)).  WT/DS343/AB/R 
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the time of import, not at the time of final assessm ent of duty liability foll owing completion of an 
assessment.  For Thailand, the fact that the fina l amount of liability for anti-dumping duties may be 
different from the amount collected as cash deposits does not affect the fundamental nature of cash 
deposits of estimated anti-dumping duties;  it only means that more duties or a refund may be due. 
38. Thailand is of the view that the ceiling on th e amount of anti-dumping duties in Article VI:2 
of the GATT 1994 and Article 9.3 of the Anti-Dumping Agreement  applies to cash deposits of 
"estimated anti-dumping duties" collected by the Unit ed States at the time of entry of dumped goods.  
The amount of the anti-dumping duty is limited to the amount of the margin of dumping established in 
the investigation, or the most recently completed assessment review.  According to Thailand, because 
dumping takes place when goods "are introduced into the commerce of another country at less than 
the normal value"55, the limit in Article VI:2 on the amount of duties that may be collected must, 
therefore, be interpreted to apply at the time of impor tation.  Thailand also refers to Article 9.2 of the 
Anti-Dumping Agreement , which provides that anti-dumping duties "shall be collected in the 
appropriate amounts" in each case.  Thailand stresses that the term "collected" must be interpreted to 
refer to the amount collected at the time of impo rtation, rather than the final liability assessed 
following an assessment review.  Thailand finds fu rther support for its position in the chapeau of 
Article 9.3, which provides that "[t]he amount of the anti-dumping duty shall not exceed the margin of 
dumping as established under Article 2."  Thailand argues that the chapeau does not contain any qualification that the "amount of the anti-dumping du ty" refers exclusively to the final amount of duty 
liability and not to the amount of duties collected in the form of cash deposits at the time of 
importation of the goods.  Thailand adds that the chap eau of Article 9.3 must be interpreted in the 
context of Articles 9.1 and 9.2, which refer to th e imposition and collection of duties.  For Thailand, 
the plain language of the chapeau of Article 9.3 canno t be read to apply only to a subsequent review 
of the amount of liability and not to the amounts collected on entry.  Thailand emphasizes that, in cases in which no assessment review is conducted, the cap in the chapeau appli es at the time when the 
goods are imported and the cash deposits are made , because that is the only time at which any 
payments of anti-dumping duties are made. 
39. According to Thailand, the interpretation th at Article 9.3 imposes a cap on cash deposits 
made at the time of entry is supported by the existe nce of a cap with respect to provisional measures.  
Article 7.2 of the Anti-Dumping Agreement  provides that provisional measures applied on entry may 
not be greater than the "provisionally estimated margin  of dumping".  Thailand maintains that, in view  
                                                     
 
55Article VI:1 of the GATT 1994. WT/DS343/AB/R 
WT/DS345/AB/R Page 16 
 
 
of the cap set forth in Article 7.2 for provisional measures, it makes no sense to interpret Article 9.3 as 
not imposing any cap on the amount of definitive duties that can be collected on entry. 
3. The Reasonableness of the EBR, as Applied to Subject Shrimp
 
40. Thailand does not challenge the Panel's conclusion that the EBR, as applied to subject shrimp, 
is not a "reasonable security".  However, Thailand does contest the Panel's statement that, "[i]n the 
context of the application of the EBR, there is no additional obligation under the Ad  Note to assess the 
risk of default of individual importers."56 
41. Thailand argues that risk of default underpin s the non-collection risk purportedly addressed 
by the EBR, and that, therefore, it must be consid ered in determining what is a reasonable amount of 
security.  For Thailand, any assessment of whether a security requirement is "reasonable" must take 
account of not only the likelihood and magnitude of increases in dumping rates, but also the 
likelihood of default by a particular importer.  Th ailand considers that the Panel erred in finding that 
only the first factor is relevant to the analysis of reasonableness under the Ad Note.  Thailand adds 
that requiring WTO Members to consider the risk of default in setting security requirements under the 
Ad Note would "simply reflect the practices followed by customs officials in numerous [countries]".57 
B. Arguments of the United States – Appellee in US – Shrimp (Thailand) 
1. Ad Note to Article VI:2 and 3 of the GATT 1994  
42. The United States requests the Appellate Body to  reject Thailand's appeal of the Panel's 
interpretation of the Ad Note in relation to the Anti-Dumping Agreement .  The United States contends 
that:  Thailand's arguments ignore the immediate co ntext of the words "suspected dumping" in the 
Ad Note;  Thailand treats the reference to "duty" as being synonymous with "cash deposit";  Thailand 
renders the provisions of Article VI of the GATT 1994 (and the Ad Note) inutile by suggesting that 
the Anti-Dumping Agreement  supersedes the GATT 1994;  and Tha iland treats statements in previous 
Appellate Body reports as dispositive of the interpretation of the Ad Note, when those reports were 
not concerned with the Ad Note or security requirements for anti-dumping duties. 
43. The United States notes that one of the central  questions before the Panel was whether any 
provisions of the  Anti-Dumping Agreement  or the GATT 1994 apply to a security requirement such 
as that contemplated by the EBR for the payment of an anti-dumping duty after  an anti-dumping duty 
                                                      
56Panel Report,  US – Shrimp (Thailand) , footnote 184 to para. 7.142.   
57Thailand's appellant's submission,  US – Shrimp (Thailand) , para. 151.  WT/DS343/AB/R 
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order has been imposed.  The United States agrees with the Panel that the Ad Note applies and is the 
sole provision that limits security  requirements of this type.   
44. More specifically, the United States argues that th e phrase "final determination of the facts" in 
the Ad Note refers, in the context of a retrospectiv e duty assessment system, to the determination of 
the "final liability for payment of anti-dumping dut ies" as provided for in Article 9.3.1 of the Anti-
Dumping Agreement .  Therefore the "final determination of the facts" in the Ad Note follows an 
assessment review under Article 9.3.1.  The United Stat es considers this interpretation to be consistent 
with the references in the Ad Note to "security ... for ... paymen t" and "other cases in customs 
administration".  As in other cases in customs ad ministration, security is required upon entry of 
merchandise, when the actual amount of liability is no t known, until the liability is finally determined 
and duties assessed and paid.  Furthermore, Article VI:2 and 3 of the GATT 1994 addresses the 
"levy[ing]" of anti-dumping and countervailing duti es, and this term used in Article 4.2 (and 
footnote 12 thereto) of the Anti-Dumping Agreement  refers to the "definitive or final legal assessment 
or collection of a duty or tax".  Thus, the "final determination" in the Ad Note extends to security 
pending final legal assessment of duties, which, in retrospective duty assessment systems, does not 
occur when the anti-dumping duty order is imposed;  rather, it occurs when final duty liability is 
assessed. 
45. The United States submits that ther e is contextual support in the Anti-Dumping Agreement  for 
the Panel's interpretation.  Article 9.3 requires that the anti-dumping duty not exceed the margin of 
dumping established under Article 2 of the Anti-Dumping Agreement .  The United States considers 
that the cash deposit and the enhanced bond secure pa yment of this amount of duty and ensure the 
ability of the United States to collect this amount of duty in accordance with Article 9.2.  The United 
States notes that the reference in Article 9.3.1 to "f inal" liability coincides with the use of the term 
"final" determination of the facts in the Ad Note. 
46. The United States disagrees with Thailand that  the imposition of an anti-dumping duty order 
means that dumping is no longer "suspected", and that, therefore, the Ad Note does not permit security 
for the payment of anti-dumping duties after the or der is imposed.  The United States argues that the 
term "suspected" should be interp reted based on its immediate context.  The United States rejects the 
idea that dumping is no longer "suspected" once the order is imposed, because the use of the present 
tense in Article VI of the GATT 1994 and certain provisions of the Anti-Dumping Agreement  
indicates that dumping is a "continuous state".  Furt her, the United States rejects the idea that the 
Ad Note is "governed" by the Anti-Dumping Agreement  and that, therefore, anything not addressed by WT/DS343/AB/R 
WT/DS345/AB/R Page 18 
 
 
the Ad Note is prohibited.
58  The United States contends that no provision of the relevant covered 
agreements refers to dumping as an "ongoing" or "c ontinuous" act;  to the contrary, Article 11 of the 
Anti-Dumping Agreement refers to the continuation or "recurrence" of dumping, which suggests that 
dumping could be "episodic" in nature.59  Furthermore, Article 9.3.1 refers to final liability for the 
payment of anti-dumping duties, which requires that there be a determination as to whether or not 
these entries were dumped.  If dumping were indeed  "continuous", duties would always be owed;  
however, footnote 22 to Article 11.3 indicates otherwise, since an order may remain in place even 
after it has been determined that no duties are owed with respect to entries from one assessment 
period.60  Furthermore, footnote 22 does not suggest that a finding of zero liability for a given set of 
entries extinguishes the suspicion of dumping;  rath er, as the Panel found, it would be reasonable to 
suspect that future imports may be dumped based on the original dumping determination underlying 
the anti-dumping duty order.61 
47. The United States also notes that the Ad Note itself provides that security in a case of 
"suspected dumping" relates to "payment" "pending final determination of the facts".  "Suspected 
dumping" must be understood in the context of an  assessment of whether and in what amount duties 
must be paid.  In a retrospective duty assessment  system, this is not known until the assessment is 
completed, and dumping is suspected during the in tervening period when an assessment is being 
conducted.  The United States contends that Tha iland's interpretation divorces the term "suspected" 
from its immediate context, which pertains to  the process of assessing and collecting duties. 
48. The United States also rejects Thailand's arguments that Article VI of the GATT 1994 and 
Article 5.1 of the Anti-Dumping Agreement  suggest that security is limited to the period prior to the 
imposition of an anti-dumping duty order.  The Unite d States considers Thailand's argument that the 
only "determination" referred to under Article VI:2 and 3 is one that results in an anti-dumping duty 
order to be without basis, because it is contrary to th e manner in which the term "levy" is used in the  
                                                      
58United States' appellee's submission, US – Shrimp (Thailand) , para. 16 (referring to Thailand's 
appellant's submission, US – Shrimp (Thailand) , paras. 22 and 23). 
59United States' appellee's submission, US – Shrimp (Thailand) , para. 17. 
60Ibid.,  Footnote 22 to Article 11.3 of the  Anti-Dumping Agreement  reads: 
When the amount of the anti-dumping duty is assessed on a retrospective basis, a finding in the most recent assessment proceeding under 
subparagraph 3.1 of Article 9 that no duty is to be levied shall not by itself 
require the authorities to terminate the definitive duty. 
61United States' appellee's submission, US – Shrimp (Thailand) , para. 34 (referring to Thailand's 
appellant's submission, US – Shrimp (Thailand) , para. 66;  and Panel Report, US – Shrimp (Thailand) , 
footnote 150 to para. 7.104).   WT/DS343/AB/R 
 WT/DS345/AB/R 
 Page 19 
 
 
Anti-Dumping Agreement , that is, as encompassing assessment and collection of duties.  With regard 
to Article 5.1, the United States agrees with the Pa nel that, because the existence of dumping has to be 
proven at the time of the imposition of an anti- dumping duty order, this does not mean that the 
existence of dumping is being established in respect of  future import entries covered by that order.  
Article 5.1 merely requires that dumping exists at  the time of the order's imposition;  however, until 
the assessment review is completed, it is not known whether specific entries are being dumped, and thus dumping is still "suspected" as to those future entries.  
49. The United States also rejects Thailand's relia nce on previous Appella te Body reports in 
support of its views.  Contrary to Thailand's argu ments, the Panel did not address whether dumping is 
determined on a product or on a transaction-specific basis, a question that is irrelevant for this dispute.  
Rather, the Panel focused on the timing of the assess ment of duties and noted that whether and what 
amount of duties are owed is determined only af ter entry of the goods.  Moreover, the Panel 
recognized, as did the Appellate Body in Mexico – Anti-Dumping Measures on Rice , that, at the time 
an order is imposed, a Member is not required to  establish the existence of dumping for all future 
entries covered by the order;  Members choosing to use a retrospective duty assessment system may 
determine final liability after an order is imposed.
62 
50. The United States submits, with respect to negotiating documents, that the text of the Ad Note 
is sufficiently clear, and that recourse to the nego tiating history, as provided for in Article 32 of the 
Vienna Convention on the Law of Treaties 63 (the " Vienna Convention "), is unnecessary.  Further, the 
term "suspected" in the 1948 Report of Working Pa rty on Modifications to the General Agreement64, 
referred to by Thailand, did not relate to the Ad Note;  and other reports relied on by Thailand were 
issued 10 and 20 years after the Ad Note was inserted, and therefore cannot be relevant as negotiating 
history.65   
51. The United States further argues that the Panel properly found that the Anti-Dumping 
Agreement  does not prohibit security requirements such as the EBR, if they are "reasonable".  As to 
the relationship between the Anti-Dumping Agreement  and the Ad Note, the United States agrees with 
the Panel's reliance on the Panel and Appellate Body Reports in Brazil – Desiccated Coconut  in  
                                                      
62United States' appellee's submission, US – Shrimp (Thailand) , para. 21 (referring to Panel Report, US 
– Shrimp (Thailand) , para. 7.109;  and Appellate Body Report, Mexico – Anti-Dumping Measures on Rice , 
para. 165). 
63Done at Vienna, 23 May 1969, 1155 UNTS 331;  8 International Legal Materials 679. 
64Report of Working Party on Modifications to the General Agreement, GATT/CP.2/22/Rev.1, adopted 
1 September 1948, BISD II/37. 
65United States' appellee's submission, US – Shrimp (Thailand) , para. 23 (referring to Thailand's 
appellant's submission,  US – Shrimp (Thailand) , para. 37 and footnote 51 thereto, and para. 42). WT/DS343/AB/R 
WT/DS345/AB/R Page 20 
 
 
finding that, where the Ad Note authorizes a conduct and the Anti-Dumping Agreement  confirms that 
such conduct is not prohibited by it, there is no basis for prohibiting such conduct.
66  The United 
States rejects Thailand's approach, whic h suggests that the silence of the Anti-Dumping Agreement  on 
an issue means that it is prohibited, even if expressly permitted by the GATT 1994.  Thailand's 
approach would "read Article VI and the Ad  Note out of the covered agreements entirely, depriving 
both provisions of any meaning."67  According to the United States, and as recognized by past panels 
and the Appellate Body, Article VI is part of the same treaty as the Anti-Dumping Agreement  and 
should not be interpreted to deprive it or the Anti-Dumping Agreement  of meaning.68  Neither the 
Appellate Body Report in US – Offset Act (Byrd Amendment) , nor in US – 1916 Act , supports the 
view that an action permitted by the Ad Note, and not addressed by the Anti-Dumping Agreement , is 
prohibited by Article 18.1 of the Anti-Dumping Agreement . 
52. In addition, the United States agrees with the Panel that Article 7 of the Anti-Dumping 
Agreement  does not address security requirements after th e imposition of an anti-dumping duty order.  
The United States considers that Thailand's argument , that Article 7 governs the application of the 
Ad Note, is based on the fallacy that, if provisional m easures within the meaning of Article 7 can take 
the form of security, all security requirements mu st be provisional measures.  The United States 
considers that, since Article 7 does not address security requirements after the dumping determination 
is made, it cannot place limitations on those requirement s beyond the limited scope of application of 
the Ad Note.  Thus, in the United States' view, Article 7 is irrelevant to the legal assessment of the 
EBR.  The fact that both Article 7 and the Ad Note refer to "cash deposits and bonds", does not mean 
that all security must be provisional.69 
53. The United States argues further that the Panel properly found that Article 9 of Anti-Dumping 
Agreement  does not address security requirements.  More  specifically, the United States agrees with 
                                                      
66United States' appellee's submission, US – Shrimp (Thailand) , para. 24 (referring to Panel Report, 
US – Shrimp (Thailand) , para. 7.93 and 7.94 and footnote 142 thereto, in turn referring to Panel Report, Brazil – 
Desiccated Coconut , para. 227 and footnote 6 thereto;  and Appellate Body Report, Brazil – Desiccated 
Coconut , p. 14, DSR 1997:I, 167, at 179). 
67Ibid., para. 25.  
68Ibid., (referring to Panel Report, US – 1916 Act (EC) , para. 6.97). 
69Ibid., paras. 29-31 (referring to Thailand's submission, para. 50;  and Panel Report, US – Shrimp 
(Thailand) , para. 7.129).  The United States also refers to Panel Report, US – Shrimp (Thailand) , para. 7.125, in 
which the Panel referred to a statement in the 1959 Group of Experts Report ( supra , footnote 41) that "Article 
VI made no mention of [provisional measures]."  Accord ing to the Panel, this statement is "fundamentally at 
odds" with Thailand's argument that the scope of the Ad Note is limited to provisional measures taken prior to 
final determination of dumping. (Panel Report, US – Shrimp (Thailand) , para. 7.126)  The United States 
disagrees with the argument that this  statement by the Group of Experts simply meant that Article VI and the 
Ad Note do not use the term "provisional measures".  The United States also rejects Thailand's reference to an 
exchange between the United States and the United Kingdom in 1965, which, according to Thailand, quotes 
United States law at the time regarding the use of certain bonds as provisional measures. (United States' 
appellee's submission, US – Shrimp (Thailand) , para. 30)   WT/DS343/AB/R 
 WT/DS345/AB/R 
 Page 21 
 
 
the Panel's interpretation of "suspected" dumping in the Ad Note, because reference to "final 
determination of the facts" in the Ad Note and the parallel reference to "determination of the final 
liability for payment" in Article 9.3.1 both refer to  the determination of the amount to be paid, and 
until this determination is made, du mping continues to be merely "suspected".  The United States also 
rejects Thailand's view that Article 9 contemplates on ly one type of action (that is, definitive duties), 
and that the EBR is therefore contrary to that  provision.  Although Article 9 contains certain 
obligations with respect to duties, this does not me an that it contemplates that only definitive duties 
are permitted.  The United States contends that , since cash deposits are not "definitive duties", 
Thailand's argument would imply that they are prohi bited as well.  Such a far-reaching result implies 
that the Anti-Dumping Agreement  supersedes the GATT 1994, contrary to the Appellate Body Report 
in Brazil – Desiccated Coconut .  Finally, Thailand's argument that the United States did not have a 
retrospective duty assessment system at the time when the Ad Note was inserted to support its view 
that the negotiators could not ha ve anticipated the need for security after imposition of an anti-
dumping duty order is factually incorrect.  The Un ited States refers to its Antidumping Act of 192170, 
which established a retrospective system for duty assessment, a fact that the Panel accepted.71 
54. The United States also submits that Thailand's reading of the term "margin of dumping" in 
Article 9.3 ignores the margins established in an assessment review, and that it is payment for the 
duties up to these margins that the cash deposit an d bond are intended to secure.  The United States 
claims that the Appellate Body Report in US – Zeroing (EC)72 supports its view that the "margin of 
dumping established for an exporter or foreign producer " refers to the margin of dumping found in an 
assessment review and not in the original investig ation.  Finally, the United States points out that 
Thailand does not explain how Article 9 can be read to address bonds, as bonds are not definitive 
duties.  Therefore, the Appellate Body should reject Thailand's request for clarification that 
Article VI, as interpreted by the Anti-Dumping Agreement , limits the amount of any definitive duty, 
which include the "cash deposits of estimated dump ing duties" to the amount of the previously 
determined margin of dumping. 
55. The United States also argues that the Appellate Body Reports in US – 1916 Act and US – 
Offset Act (Byrd Amendment) should not be read to imply that a dditional security is prohibited.  As 
the Panel noted, these reports do not contain any analysis of the Ad Note, nor do they even discuss 
how Members could guard against a risk that one of the "permissible responses" to dumping might be 
                                                      
70United States Antidumping Act of 1921, 42 Stat. 11, codified under United States Code , Title 19, as 
amended. 
71United States' appellee's submission,  US – Shrimp (Thailand) , para. 37 (referring to Panel Report,  
US – Shrimp (Thailand) , para. 7.129 and footnote 174 thereto).  WT/DS343/AB/R 
WT/DS345/AB/R Page 22 
 
 
circumvented.  For the United States, Thailand's read ing of the reports would alter the  balance of 
rights and obligations in the covered agreements, c ontrary to the DSU and the Appellate Body Report 
in Brazil – Desiccated Coconut . 
56. Lastly, the United States rejects the argument that security for anti-dumping duties may be 
taken only if justified under Article XX(d) of the GA TT 1994.  The United States submits that, if this 
were indeed the only provision that authorized security in cases where there is a risk of non-
collection, it is unclear why the Ad Note, or any other provision dealing with security, would have 
been included in the GATT 1994.  The United States  argues that its position in these proceedings is 
consistent with its view in EEC – Parts and Components  because, in that case, the United States had 
argued that Article XX(d) permitted GATT Contracting Parties to take action for the enforcement of 
customs laws;  it did not argue that Article XX(d) was the  only  provision addressing actions 
facilitating the collection of duties.  The United St ates notes that the "action"  in that case was anti-
circumvention measures, which are not governed by the Ad Note.  The United States further 
highlights that, if security is not inconsistent with the GATT 1994, including the Ad Note, 
Article XX(d) is not relevant for an analysis of its WTO-consistency.  Finally, the United States 
submits that Thailand's purported distinction be tween "action against dumping" under Article 18.1 
and action falling under Article XX(d) begs the ques tion of which provisions of the Agreements limit 
security for anti-dumping duties.  In the United States' view, "reasonable" security under the Ad Note 
is not exclusively related to "dumped goods", but extends to considerations such as the amount of 
potential liability and risk of default.
73 
2. Cash Deposits and Anti-dumping Duties  
57. The United States supports the Panel's view th at a cash deposit is security for a duty owed, 
and is not itself a duty.  The United States agrees with  the Panel that, in contrast to a duty, a cash 
deposit is not liquidated public re venue and has no "intrinsic value"  until duties are assessed.  The 
United States also endorses the Panel's observati on that the retrospective duty assessment in 
Article 9.3.1 would make no sense if "cash deposits " were duties, since cash deposits are established 
on a prospective basis.  It also agrees with th e Panel that there is a textual difference between 
Articles 9.3.2 and 9.3.1—the former refers to ref unds of "duties", whilst the latter refers only to 
"refund" without specifying what must be refunded—a nd that this textual difference supports the view 
that cash deposits are not duties.  Like the Panel, the United States notes that Article 7.2 distinguishes  
                                                                                                                                                                     
72United States' appellee's submission,  US – Shrimp (Thailand) , para. 42 (referring to Appellate Body 
Report, US – Zeroing (EC) , paras. 128 and 130).  
73The United States refers to its other appellant's submission in US – Shrimp (Thailand) .  WT/DS343/AB/R 
 WT/DS345/AB/R 
 Page 23 
 
 
a "cash deposit" as a form of security from "duties" , and agrees with the Panel that, in indicating a 
preference for requiring payment of cash deposits, rather  than duties, the text of Article 7.2 establishes 
a substantive difference between a cash deposit and a duty.   
58. The United States rejects Thailand's argument that "what is imposed" pursuant to an 
assessment review is a "duty" and that, because c ash deposits are "imposed", they too must be 
"duties".74  For the United States, Thailand's logic is circular.  Moreover, the reference in United 
States law to "cash deposits of estimated anti-dumpi ng duties" reflects the fact that cash deposits are 
required in an amount equal to estimated duties.75  The United States agrees with the Panel that, by 
definition, security for estimated duties is not a duty per se , it is merely a security for duties that may 
be collected in the future, and there is no dut y in the absence of any such future collection.76  For the 
United States, the fact that cash deposits are "paid in  cash", and that they may be made in an amount 
less than the final liability, does not make them "duties".77 
3. The Reasonableness of the EBR, as Applied to Subject Shrimp  
59. Whilst the United States agrees with Thailand th at the risk of default may be among the 
factors that are relevant to determining whether any additional security is reasonable within the 
meaning of the Ad Note, it disagrees with the assertion of Thailand that the likelihood of default for a 
particular importer must be taken into account in  assessing the reasonableness of a security, and that 
security can only be required where there is a "direc t and substantial risk of non-collection" of anti-
dumping duties from an importer.78  According to the United States, the text of the Ad Note does not 
suggest that "reasonableness" requires an importer-s pecific assessment of default risk.  The United 
States adds that assessing the risk of default of i ndividual importers involves practical difficulties, as 
United States Customs cannot conduct an assessment of individual risk without collecting information 
from the importer and cannot wait until the importer de faults.  The risk of default of importers as a 
whole may, however, be considered in order to assess whether requiring additional security is 
reasonable.  According to the United States, factors such as the industry's characteristics, the ability to 
pay, or the compliance history may be relevant to determine the risk of default.  The United States 
notes that, with respect to shrimp importe rs, United States Customs concluded that: 
 agriculture/aquaculture industries were characteriz ed by low capitalization and high debt-to-equity 
ratios;  importers of this type of  merchandise had been responsible for significant defaults in the past;  
                                                      
74United States' appellee's submission, US – Shrimp (Thailand) , para. 39 (referring to Thailand's 
appellant's submission, US – Shrimp (Thailand) , paras. 110 and 111).  
75Ibid.   
76Ibid.  
77Ibid., para. 40.  
78Ibid., para. 50 (referring to Thailand's appellant's submission,  US – Shrimp (Thailand) , para. 152).  WT/DS343/AB/R 
WT/DS345/AB/R Page 24 
 
 
and shrimp importers of merchandise were therefore lik ely to have a heightened risk of default due to 
similarities with these other agri culture/aquaculture importers.  For the United States, because the 
Panel failed to consider the evidence that it had provi ded regarding risk of default with respect to the 
importers of shrimp subject to anti-dumping duties,  it could not have known whether the risk of 
default was such that additional security was "reasonable".  
C. Claims of the United States – Other Appellant in US – Shrimp (Thailand) 
1. The Reasonableness of the EBR, as Applied to Subject Shrimp 
 
60. The United States explains that the EBR was developed for increasing security requirements 
regarding merchandise with a higher risk of default by  importers on final duty liability.  Past history 
had shown that importers of agriculture/aquacultu re merchandise were the source of the bulk of 
defaults, that anti-dumping rates increased in assessment reviews 38 per cent of the time, and that 
when rates increased, they did so  by an average of 285 per cent.  The United States underscores the 
fact that United States Customs applied the EBR to subject shrimp because the potential unsecured 
liability appeared significant (due to the fact that  shipments in excess of US$2.5 billion were subject 
to such orders), as did the risk of default (because the industry shared characteristics similar to those 
of other industries that, in the past, had been the source of substantial defaults). 
61. According to the United States, the Panel deve loped its own standard to determine whether 
the EBR as applied to subject shrimp constitutes "reasonable security" within the meaning of the 
Ad Note.  In considering that additional security  may only be "reasonable" if a WTO Member 
determines that the anti-dumping rate is "likely" to increase between imposition of the order and final 
assessment, the Panel adopted an incorrect standard .  This is because it would exclude bonding where 
there is less than "substantial certa inty" that such an increase will occur.  For the United States, the 
Panel's approach is contrary to the ordinary mean ing of the term "reasonable", and would imply that 
ordinary revenue collection strategies may not be a pplied to importers that are liable to anti-dumping 
duties. 
62. The United States considers that United States Customs' analysis as to whether additional 
security should be required is in line with ordinary customs practice, as United States Customs' decision to require additional security depends upon the amount of potential liability being secured 
and the likelihood of default.  The United States expl ains that the potential additional liability depends 
on the likelihood of an increase in the margin of dump ing, the likely size of that increase, and the total 
value of shipments subject to that margin of dumpi ng.  The likelihood of default by importers, on the 
other hand, will be assessed in the light of factors such as industry characteristics, ability to pay, and  WT/DS343/AB/R 
 WT/DS345/AB/R 
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compliance history.  Customs administrations do not merely secure liability that is determined to be 
"likely" to accrue;  the Panel's analysis is, ther efore, at odds with the textual reference in the Ad Note 
to "other cases in customs administration". 
63. The United States observes that the Panel asserte d that default risk is irrelevant to a 
determination of whether security is "reasonable".  According to the United States, risk of default is 
routinely taken into consideration by customs au thorities in establishing security requirements.  In 
fact, the risk of default was an important element of the analysis that led United States Customs to 
apply the EBR to subject shrimp.  The United States  considers that, "[i]f the evidence demonstrated a 
significant risk of default, the Panel should ha ve concluded that the security requirement was 
'reasonable', even if the likelihood of an increase [i n the anti-dumping rate] was less than 'substantial 
certainty'."79   
64. For the United States, the Panel's position—acco rding to which additional security may only 
be reasonable if the customs authorities show that the anti-dumping rate is "likely" to increase, and 
determine the likely amount of such increase—wo uld "limit 'reasonable security' to a calculation 
based on information that is impossible to know at the time the security is imposed."80  The United 
States argues that, to determine whether the EBR as applied to subject shrimp was "reasonable", the 
Panel should have considered the totality of the ev idence available at the time regarding the revenue 
risk against which the bond was secured.  According to the United States, this evidence included the 
likelihood of default, the amount of potential unsecu red liability, and the likelihood of rate increases. 
65. The United States therefore requests the Appellate Body to reverse the Panel's finding that the 
EBR, as applied to subject shrimp, is not a "reasona ble security" and that it is not consistent with the 
Ad Note. 
2. The Panel's Analysis of the Term "Necessary" under Article XX(d) of the 
GATT 1994  
66. Should the Appellate Body not reverse the Pane l's interpretation of the reasonableness of the 
security under the Ad Note, the United States requests the Appellate Body to reverse the Panel's 
finding that, unless a Member demonstrates that rates subject to the anti-dumping duty order "are likely to increase", an additional security requiremen t cannot be considered to be "necessary" within 
the meaning of Article XX(d) of the GATT 1994, and to complete the analysis with respect to the 
chapeau of Article XX(d). 
                                                     
 
79United States' other appellant's submission, US – Shrimp (Thailand) , para. 14. 
80Ibid., para. 17. WT/DS343/AB/R 
WT/DS345/AB/R Page 26 
 
 
67. The United States submits that the test used by  the Panel to determine the necessity of the 
EBR for purposes of Article XX(d) was the same as the one it used to evaluate the "reasonableness" 
of the security under the Ad Note.  According to the United States,  that test provides "no insight", 
since security may be "necessary" even  where there is a "likelihood" that liability will accrue, but it is 
not "likely" (in the sense of "substantial certainty") that it will do so.
81   
68. The United States recalls that the application of  the EBR to subject shrimp was necessary due 
to the significant potential unsecured liability and th e significant default associated with entries of 
similar merchandise in the past.  According to the United States, requiring additional security pending 
final determination of duties ow ed is a standard approach among WTO Members to address the 
problem of potential unsecured duty liability pending final assessment.  The United States argues that 
the Panel failed to take into account the fact that  United States Customs adopted a tailored process for 
evaluating risk and bond amounts, in which the bond amount required of an im porter reflects that 
importer's actual ability to pay duties lawfully owed, and thus the "necessity" of any additional 
security.  Further, the United States claims th at Thailand has not identified any "reasonable 
alternatives" to the EBR that would address the spec ific problem faced by United States Customs, nor 
did the Panel find that any such alternatives existed.   In fact, the possible WTO-consistent alternatives 
cited by the complaining parties—including the cash  deposit requirement, civil recovery proceedings, 
and the "basic bond requirement"82—were already in effect when United States Customs experienced 
its non-collection problem.  Finally, the United States  contends that the EBR meets the requirements 
of the chapeau of Article XX and requests the Appella te Body to complete the analysis, given that 
there is sufficient evidence in the record to do so;  and also to find that the EBR is "necessary" to 
enforce relevant United States anti-dumping laws and regulations. 
D. Arguments of Thailand – Appellee in US – Shrimp (Thailand) 
1. The Reasonableness of the EBR, as Applied to Subject Shrimp  
69. Thailand points out that, in the event the Appellate Body interprets the Ad Note as temporally 
limited to the period before definitive duties are im posed, it will not reach the issues raised in the 
United States' other appeal. 
70. Thailand contends that the United States' appeal  of the Panel's finding that the EBR is not a 
"reasonable security" within the meaning of the Ad Note is predicated on a "fundamental 
                                                      
81United States' other appellant's submission, US – Shrimp (Thailand) , para. 21.   
82"Basic bond requirement" refers to the basic requirements listed in the 1991 Directive for a 
continuous bond.  WT/DS343/AB/R 
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misunderstanding or misrepresentation of the standard actually applied by the Panel".83  I t  i s  a l s o  
based on the assumption that the Panel interpreted "reasonable" in the Ad Note to require that 
additional security is permitted only where there is a "substantial certainty" of an increase in dumping 
margins.84   Thailand considers that the Panel's sta ndard was, rather, that there should be a 
"likelihood" that margins will increase, and that a dditional security should only be required up to the 
"likely amount" of such increase.  Thailand submits th at the terms "likely" and "substantial certainty" 
are distinct and represent different levels of probabi lity, and that the Panel did not, in fact, apply a 
standard of "substantial certainty".85   
71. Thailand considers that the test of reasonablen ess developed by the Panel is consistent with 
the ordinary meaning of that term.  Thailand subm its that the dictionary definition of "reasonable" 
endorsed by the Panel—that is, "in accordance with reason;  not irrational or absurd";  and with 
respect to amounts, "[w]ithin the limits of reason;  not greatly less or more than might be thought to 
be likely or appropriate"86—had been proposed by the United St ates, and that the test ultimately 
applied by the Panel "closely follows"87 this definition.  Thailand recalls  that the Panel construed this 
definition as requiring, in the case of "suspected du mping", a proper determin ation that dumping rates 
were "likely" to increase before additional security  could be imposed, and that additional security 
should not be "greatly more"88 than the amount of "likely" additional anti-dumping duty liability.  
According to Thailand, it is apparent that secur ity "greatly more" than the amount of likely anti-
dumping duty liability considerably burdens importers  without generating subs tantial benefits as far 
as revenue collection is concerned, and thus is neither "in accordance w ith reason", nor "appropriate".   
72. Thailand further submits that the Panel was corr ect in basing its standard of reasonableness on 
the amount of "likely" anti-dumping duty liability, and not on an indeterminate amount of "possible" 
liability, as proposed by the United States.  Under th e United States' test, additional security would be 
"reasonable" as long as there is a "reasonable possibi lity" or "reasonable chance" of dumping margins 
increasing.  This would mean that the United States would always  be permitted to require additional 
security of an indeterminate amount.  Thailand agrees with the Panel that the Ad Note does not 
                                                      
83Thailand's appellee's submission, US – Shrimp (Thailand) , para. 17. 
84Ibid., paras. 14 and 17 (referring to United States' other appellant's submission, US – Shrimp 
(Thailand) , paras. 6, 11, 14, and 21).  
85Ibid., para. 15 (referring to Panel Report, US – Shrimp (Thailand) , paras. 6.58 and 6.69;  in particular, 
the Panel's statements at paragraph 6. 58 merely restate the position of the United States at the interim review 
stage.   Further, Thailand explains that the Panel dec lined during its interim review comments to accede to the 
United States attempt to "weaken" the likely standard to one of "possible" liability).   
86Ibid., para. 19 (referring to Panel Report,  US – Shrimp (Thailand) , para. 7.139;  and The New Shorter 
Oxford English Dictionary , 4th edn, L. Brown (ed.) (Clarendon Press, 1993), Vol. 2, p. 2496).  
87Ibid., para. 20.  
88Panel Report, US – Shrimp (Thailand) , para. 7.141.  WT/DS343/AB/R 
WT/DS345/AB/R Page 28 
 
 
sanction security at levels that seek to "eliminate" totally the risk of non-collection of increased duty 
liability in a retrospective duty assessment system. 
73. Thailand notes that the United States has not appealed the Panel's finding that the EBR 
constitutes "specific action against dumping" within the meaning of Article 18.1 of the Anti-Dumping 
Agreement .  Therefore, it does not dispute that the EBR acts "against" exporters of shrimp to deter 
them from exporting dumped products.  In Thailand' s view, the EBR therefore has an impact upon 
exporters, just as anti-dumping duties do, and the disciplines of the Anti-Dumping Agreement  and 
Article VI of the GATT 1994 would be undermined if the broad interpretation of "reasonable" by the 
United States were endorsed.  Given the United Stat es' admission that the actual margin of dumping 
from the investigation or most recent assessment revi ew is the "best and only available baseline proxy 
of duties that ultimately may be assessed"
89, Thailand submits that the te rm "reasonable" should be 
narrowly construed to ensure that additional security , and therefore additional costs to exporters in 
excess of this baseline, are not permitted.  
74. Thailand also contests the United States' argument that the Panel misconstrued the phrases "as 
in other cases of customs administration" and "any case of suspected dumping" in the Ad Note.  
Thailand disagrees that the Panel's interpretation of  "reasonable" does not accord with the practices 
adopted by customs authorities "as in other cases of  customs administration", and submits that the 
United States' argument is difficult to reconcile with its own admission that United States Customs 
considers the likelihood and size of an increase in  dumping margins when setting security amounts.  
Moreover, the record does not suggest that customs authorities routinely, if ever, require additional 
security even where there is a high risk of defa ult.  Thailand endorses the Panel's view that the 
Ad Note does not impose a substantive obligation to a dhere to "ordinary customs practice", and argues 
that there is no evidence on the record regarding precise practices of customs authorities other than 
the United States.  Thailand also points to a ruling  of the United States Court of International Trade90 
(the "USCIT") that the EBR violated United States  law governing bond determ inations, and that it 
was applied in an "arbitrary and capricious manner", which is difficult to reconcile with the United 
States' position that the EBR conforms  to "ordinary customs practice". 
                                                      
89Thailand's appellee's submission,  US – Shrimp (Thailand) , para. 25 (referring to United States' first 
written submission to the Panel in US – Shrimp (Thailand) , para. 37). 
90Ibid., para. 28 (referring to USCIT, National Fisheries Institute Inc. , et al v. United States Bureau of 
Customs and Border Protection , No. 05-00683 (Exhibit THA-9 submitted by Thailand to the Panel), pp. 54-61).  WT/DS343/AB/R 
 WT/DS345/AB/R 
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75. Thailand rejects the United States' argument that the Panel's standard unduly limits security to 
a calculation based on information impossible to know at the time security is imposed.  Thailand does 
not see why it would be "impossible" to make predic tions on likely liability at the time of entry, and 
recalls the United States' admission that United St ates Customs routinely considers the likelihood of 
increase in margins and the size of that increase.  Furthermore, Thailand notes that Article 11.3 of the 
Anti-Dumping Agreement  contemplates prospective assessments in sunset reviews of the likelihood of 
dumping to continue.  Thailand also submits that, if  it were indeed "impossible" to predict dumping 
margins, it would be prudent to base security requ irements on the most recently assessed margin of 
dumping, because the United States itself admits th at these margins are the best and only available 
proxy of duties that will be ultimately assessed. 
76. Thailand argues that the risk of default cannot  justify the imposition of security in excess of 
the amount of likely anti-dumping duty liability.  Whilst Thailand accepts that the importers' risk of 
default is an important factor for assessing the reasonableness of security, this factor affects the analysis in a manner different to that suggested by  the United States.  In Thailand's view, the amount 
of security cannot exceed the likely amount of future liability and, therefore, the risk of default must 
be considered only for deciding whether to require security for the full amount or a lesser amount.  
Thailand highlights that dumping is an "exporter-sp ecific" concept, and the amount of likely future 
liability for dumping duties as well.  Whilst the EBR acts "against" exporters, it is the importers who 
pay duties and to whom the risk of default rela tes.  Thus, it would not be reasonable to permit 
additional "action against dumping" in the form of security under the Ad Note in excess of the 
exporter's  likely future dumping margin on the basis of importer-specific factors.  Thailand further 
submits that the United States fails to clarify how the reasonable amount of security demanded from 
an importer with a high risk of default would be assessed and how this would affect the determination 
of the amount of security exceeding expected liability. 
77. Thailand agrees with the Panel that general historical trends in dumping margins in 
agriculture/aquaculture cases could not have justifie d conclusions that dumping margins were likely 
to increase in the case of subject shrimp.  Thailand submits that the United States has not contested these Panel findings and, therefore, the Appellate Body should not disturb them.  For Thailand, the 
Panel was legitimately concerned with the absence of  documentary evidence at a level of detail that 
would enable it to assess the rigour and relevance of the analysis carried out by United States 
Customs. WT/DS343/AB/R 
WT/DS345/AB/R Page 30 
 
 
78. Regarding the United States' argument that the Pa nel failed to consider the risk of default, 
Thailand recalls that the Panel found that "reasonable"  security is limited to the amount of the likely 
future dumping margin.  Accordingly, the Panel ca nnot be faulted for not taking into account evidence 
of risk of default, because such risk could not ju stify security in excess of the likely future dumping 
margin.   
2. The Panel's Analysis of the Term "Necessary" under Article XX(d) of the 
GATT 1994  
79. Thailand submits that Article XX(d) of the GATT 1994 cannot operate as a defence to an 
inconsistency with the Anti-Dumping Agreement , and that the Appellate Body need not therefore 
make findings on the Panel's analysis of necessity  under Article XX(d), or under its chapeau.  In 
Thailand's view, once an action has been found to be an impermissible "specific action against 
dumping" under Article 18.1 of the Anti-Dumping Agreement , as the Panel found with respect to the 
EBR, such action cannot be "rehabilitated" as WTO-consistent by recourse to a defence under 
Article XX(d). 
80. Thailand argues that, in any event, the United States' appeal against the Panel's necessity 
analysis rests on the same arguments as the analysis of "reasonableness" under the Ad Note.  In 
Thailand's view, the latter analysis is "simply inapplicable" to the analysis required under 
Article XX(d) because the two provisions contain different language.  Nor does the United States 
explain how or why the reasonableness analysis under the Ad Note should appl y also to the 
interpretation of "necessary" under Article XX(d), or fu rther how the EBR is applied consistently with 
the chapeau. 
81. Thailand submits that the United States does not  explain how the Panel failed to consider 
certain "aspects" of the EBR in its analysis.91  Thailand emphasizes that the United States fails to 
explain how the fact that the import value of subject  shrimp is in excess of US$2 billion, and how the 
significant risk of default associated with these en tries could justify the EBR if dumping margins are 
not likely to increase. 
82. Thailand further contends that the United States fails to explain why only importers of subject 
shrimp must pay additional security, and why the "l ess trade restrictive" co mbination of the basic 
bond requirement, cash deposits, and ordinary enforcement proceedings was not adequate.92  
According to Thailand, in the ab sence of evidence that dumping margins are likely to increase by 
                                                      
91Thailand's appellee's submission, US – Shrimp (Thailand) , para. 47 (referring to United States' other 
appellant's submission, US – Shrimp (Thailand) , para. 22). 
92Ibid., para. 48.   WT/DS343/AB/R 
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100 per cent, and that there is a significant risk of  default, the EBR cannot be considered as a measure 
"necessary" to secure compliance with laws and regulations requiring paym ent of anti-dumping 
duties.  Nor is it clear that the EBR would reme dy difficulties in collecting duties owed since the 
evidence suggests that these difficu lties arise from the interaction of unique factors that were 
particular to imports of crawfish from China.93  Moreover, Thailand argues, by applying the EBR to 
only six WTO Members, whilst exempting other im porters of products from other countries that 
present equivalent or even greater risks to revenue , the United States "arbitrarily" and "unjustifiably" 
discriminates between countries where the same conditions prevail.94  Thailand also contends that the 
EBR operates as a "disguised restriction on internati onal trade" in shrimp products.  For all of these 
reasons, Thailand requests the Appellate Body to find  that the United States has not met the burden of 
establishing the affirmative defence under Article XX (d) of the GATT 1994 and that its arguments on 
appeal be rejected. 
E. Claims of India – Appellant in US – Customs Bond Directive 
1. Ad Note to Article VI:2 and 3 of the GATT 1994  
83. India argues that the Panel erred in its interp retation of the phrase "as interpreted by this 
Agreement" in Article 18.1 of the Anti-Dumping Agreement  and in Article 32.1 of the SCM 
Agreement .  India submits that any interpretation of the Ad Note that would authorize the United 
States to impose the EBR independently of the th ree permissible specific actions against dumping 
under the Anti-Dumping Agreement  or of the four permissible specific actions under the SCM 
Agreement  would render this phrase redundant and inutile.  According to India, had the intent of the 
drafters of the Anti-Dumping Agreement  and the SCM Agreement  been to consider as permissible the 
specific actions identified in Article VI:2 or 3 of the GATT 1994, but not specified in the Anti-
Dumping Agreement  or the SCM Agreement , they would not have included the phrase "as interpreted 
by this Agreement" in the text of Article 18.1 of the Anti-Dumping Agreement  and Article 32.1 of the 
SCM Agreement .   
84. India also considers that the Panel erred in concluding, on the basis of the Appellate Body 
Report in US –  Offset Act (Byrd Amendment) , that the phrase "as interpreted by this Agreement" was 
intended solely to clarify that the relevant provisi on of the GATT 1994 was Article VI.  For India, the 
second sentence of Article 1 of the Anti-Dumping Agreement supports its view that the provisions of 
the Anti-Dumping Agreement  limit the types of specific actions that may be taken against dumping  
                                                      
93Thailand's appellee's submission, US – Shrimp (Thailand) , para. 48. 
94Ibid.  WT/DS343/AB/R 
WT/DS345/AB/R Page 32 
 
 
under Article 18.1 of the Anti-Dumping Agreement .  India points out that, in US – 1916 Act  and in 
US – Offset Act (Byrd Amendment) , the Appellate Body "emphasized the importance of reading 
Article VI and, in particular, Article VI:2, in conjunction with the whole  of the Anti-Dumping 
Agreement to determine what are the permissible specific actions against dumping."
95  India adds that 
the Panel's interpretation of the phrase "as interprete d by this Agreement" would imply that specific 
actions against dumping or subsidization that are expressly contemplated by the Anti-Dumping 
Agreement  would not be permissible unless they are expressly authorized by Article VI of the 
GATT 1994 as well.  According to India, the phrase " as interpreted by this Agreement" requires an 
analysis of the text of Article VI of the GATT 1994, the Anti-Dumping Agreement , and the SCM 
Agreement  as a whole to determine what are the specific actions permissible under the Anti-Dumping 
Agreement  and under the SCM Agreement . 
85. India observes that the Panel's analysis of the relationship between Article VI of the 
GATT 1994 and the provisions of the Anti-Dumping Agreement  was based on a general observation 
made by the Appellate Body in Brazil – Desiccated Coconut , according to which the provisions of the 
SCM Agreement  (or by implication, the Anti-Dumping Agreement ) do not supersede the provisions of 
Article VI of the GATT 1994.  For India, the Panel erred in wrenching this general observation of the 
Appellate Body out of its context and in making it the basis for its conclusion on the permissibility of 
a fourth specific action against dumping (that is, the taking of security for definitive anti-dumping duties).  In India's view, the Panel could not have  relied on this general observation to find that a 
specific action against dumping is permissible, as authorized by the Ad Note, but which is prohibited 
by the Anti-Dumping Agreement .  On the basis of the same Appell ate Body Report, India argues that 
Article VI of the GATT 1994 cannot be applied independently of the Anti-Dumping Agreement , and 
that Article VI read in conjunction with the Anti-Dumping Agreement  modified the rights of the WTO 
Members with respect to anti-dumping measures, as co mpared to their rights under Article VI taken in 
isolation.  In this respect, India argues that Article 7 of the Anti-Dumping Agreement  does address the 
taking of security for the payment of anti-dumping duties and, therefore, the Ad Note is not available 
as a stand-alone provision independent of the Anti-Dumping Agreement  to justify the taking of a 
security. 
86. India points out that, in US – 1916 Act  and US –  Offset Act (Byrd Amendment) , the Appellate 
Body found that there were only three specific ac tions permissible against dumping (definitive duties, 
provisional measures, and price undertakings), and four permissible specific actions against 
subsidization (including multilaterally sanctioned c ountermeasures in addition to the three specific 
actions permissible in the context of dumping).  According to India, the Panel's position (that the 
                                                     
 
95India's appellant's submission, US – Customs Bond Directive , para. 21.  See also ibid., para. 24.  WT/DS343/AB/R 
 WT/DS345/AB/R 
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taking of reasonable security for the payment of anti-dumping duties is a permissible action against 
dumping) is not consistent with th ese Appellate Body findings.  Furthermore, India argues that the 
Panel erred in considering that these findings were  dicta on the grounds that, in these two cases, the 
Appellate Body did not address the provisions of the Ad Note.  For India, these findings do not 
constitute obiter dictum .  India adds that the Panel was mist aken when it said that, in reaching these 
findings, the Appellate Body did not refer to the provisions of the Ad Note.  In India's view, it was 
inappropriate for the Panel to disregard settled WTO jurisprudence, as coherence and continuity in 
WTO jurisprudence contribute to security and pred ictability in the multilateral trading system.   
87. India argues that the Ad Note cannot be interpreted as aut horizing a security requirement for 
the payment of anti-dumping duties under a retrospec tive duty assessment system.  India submits that, 
in interpreting the Ad Note, the Panel "worked backwards from its strongly held conviction that it was 
essential that Members such as the United States that  follow the retrospective duty assessment system 
be permitted to take security in cases where th ere is a likelihood of increase in dumping margins 
between the final determination (at the end of the investigation phase) and the final assessment 
review."96  For India, the Panel's approach was not in  accordance with the cu stomary principle in 
Article 31(1) of the Vienna Convention  that a treaty provision shall be  interpreted in good faith in 
accordance with its ordinary meaning in its contex t and in the light of its object and purpose. 
88. India contends that the Panel erred in interpre ting and applying the term "suspected dumping" 
in the Ad Note.  For India, in focusing exclusively on the retrospective duty assessment system as 
applied by the United States to determine whether there remains "a case of suspected dumping" after 
the determination of dumping and preceding the imposition of a United States anti-dumping duty 
order, the Panel departed from the customary principles of treaty interpretation.  According to India, 
the Panel's interpretation implies that suspicion of dumping begins after the final determination of the 
existence of injurious dumping, a r esult that India views as "startling"97 from the standpoint of the 
prospective duty assessment system. 
89. India maintains that the Panel also erred in  interpreting and applying the term "final 
determination" in the Ad Note.  India considers that this term mu st be interpreted in the light of the 
context provided by the Anti-Dumping Agreement  and the SCM Agreement .  In this respect, India 
points out that, in many cases where the term is us ed in these agreements, it is used in conjunction 
with the term "preliminary determination" and the phrase "affirmative or negative".  India also 
underlines that, in most cases, the term "final determ ination" is referred to in the singular in the 
                                                      
96India's appellant's submission, US – Customs Bond Directive , para. 55. (footnotes omitted) 
97Ibid., para. 59. WT/DS343/AB/R 
WT/DS345/AB/R Page 34 
 
 
context of the determination immediately preceding th e application of "final measures" or "definitive 
duties".
98  For India, these contextual considerati ons establish that there is only one final 
determination in the life of an anti-dumping or  countervailing measure, and that this final 
determination precedes the decision to impose a duty under Article 9.1 of the Anti-Dumping 
Agreement , or under Articles 19.1 and 19.2 of the SCM  Agreement .  India contends that the Panel's 
interpretation of the term "final  determination"—which, in the case of a retrospective assessment 
system, means the "determination of the final liab ility for payment of anti-dumping duties" referred to 
in Article 9.3.1 of the Anti-Dumping Agreement —is erroneous, because such an interpretation would 
imply that there is not a single final determinati on of the facts in a case of suspected dumping, but 
rather a series of final determinations. 
90. India maintains that the Panel's interpretation of the Ad Note brings about an asymmetry 
between the prospective and the retrospective duty asse ssment systems.  In India's view, the Panel's 
interpretation of the terms "suspected dum ping" and "final determination" in the Ad Note bestows 
special privileges on the retrospective duty assessment  system as compared to the prospective duty 
assessment system, because it permits only the Member s that follow the retrospective duty assessment 
system to take additional security for the payment of anti-dumping duties.  India contends that, since 
the Panel concluded that Article 7 of the Anti-Dumping Agreement  and Article 17 of the SCM 
Agreement  do not implement the Ad Note, the Ad Note remains available solely to WTO Members 
such as the United States that follow the retrospective system of duty assessment. 
91. India submits that Article 7 of the Anti-Dumping Agreement  and Article 17 of the SCM 
Agreement  implement the Ad Note to the extent that these provisi ons permit security to be taken as a 
provisional measure.  Accordingly, India reasons, th e United States cannot justify the EBR under the 
Ad Note independently of these provisions.  In dia points out differences between the Ad Note and 
Article 7 of the Anti-Dumping Agreement as well as Article 17 of the SCM Agreement  (the latter 
provisions seem to impose stricter conditions on taking security than the Ad Note) that cannot be 
circumvented by relyin g exclusively on the Ad Note.  According to India, Article 7 of the Anti-
Dumping Agreement and Article 17 of the SCM Agreement  "implement the Ad Note in the sense that 
each of these provisions forms part of the insepar able package of rights and disciplines under the 
provisions of Article VI of the GATT 1994 including the Ad  Note read in conjunction with the Anti-
Dumping Agreement (or the SCM Agreement, as the case may be)."99 
                                                      
98India's appellant's submission, US – Customs Bond Directive , para. 63. 
99Ibid., para. 81.  WT/DS343/AB/R 
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2. Cash Deposits and Anti-dumping Duties  
92. India appeals the Panel's finding that cash de posits are not anti-dumping duties within the 
meaning of Article 9 of the Anti-Dumping Agreement .  For India, whether cash is accepted as a "cash 
deposit" or as "payment of duties", it is a differenc e only in nomenclature and not in substance.  In 
this respect, India points to submissions made by  the United States to the Negotiating Group on Rules 
in relation to Article 9.3 in which, allegedly,  the United States characterized payments of cash 
deposits made under Article 9.3.1 as "duties".100   
93. India also refers to submissions made by the United States to the panels in US – Zeroing (EC)  
and US – Section 129(c)(1) URAA  that, allegedly, admit that the United States collects duties as 
opposed to security during the period between the imposition of an anti-dumping duty order and an 
assessment review.  Assuming arguendo  that the United States collects cash deposits by way of 
security and not by way of duties, India submits th at the United States cannot take such security in 
excess of the margins specified  in Article 9.3 of the Anti-Dumping Agreement  and Article 19.4 of the 
SCM Agreement . 
94. India refers to the Appellate Body Report in US – Zeroing (Japan)  in which the Appellate 
Body stated that, "[a]t the time of importation, an administering authority may collect duties, in the 
form of a cash deposit, on all export sales, including those occurring at above the normal value."101  
According to India, the Panel erred in characterizing this statement as obiter dicta .  India considers 
that the observation of the Appellate Body in US – Zeroing (Japan)  should take precedence over 
factual statements made by the Appellate Body in US – Zeroing (EC) , where the Appellate Body 
stated that the United States collects se curity in the form of a cash deposit102, because the observation 
made in US – Zeroing (Japan)  was part of the Appellate Body's  reasoning in rejecting the panel's 
analysis relating to the retrospective duty assessment system.103 
3. The Reasonableness of the EBR, as Applied to Subject Shrimp  
95. India does not challenge on appeal the Panel's ultimate finding that the EBR, as applied to 
subject shrimp, is not a "reasonable security".  However, India does contest the Panel's statement that, 
                                                      
100India's appellant's submission, US – Customs Bond Directive , footnotes 113 and 114 to para. 111 
(referring to Negotiating Group on Rules, Identifica tion of Additional Issues under the Anti-Dumping and 
Subsidies Agreements, Paper submitted by the United St ates, TN/RL/W/98 (6 May 2003);  Negotiating Group 
on Rules, Accrual of Interest (ADA Articles 9.3.1 and 9.3.2), Communication from the United States,  
TN/RL/W/168 (10 December 2004);  an d Negotiating Group on Rules, Co llection of Anti-Dumping Duties 
under Article 9.3, Communication from the Un ited States, TN/RL/GEN/131 (24 April 2006)). 
101Appellate Body Report, US – Zeroing (Japan) , para. 156. 
102Appellate Body Report, US – Zeroing (EC) , para. 109.  
103India's appellant's submission, US – Customs Bond Directive , para. 116. WT/DS343/AB/R 
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"[i]n the context of the application of the E BR, there is no additional obligation under the Ad  Note to 
assess the risk of default of individual importers."
104 
96. India claims that the Panel erred in concludi ng that the term "reasonable security" under the 
Ad Note did not require the United States to assess the likelihood of default by individual importers.  
For India, because any exercise in estimating the likely increase in the liability for anti-dumping 
duties and the likely amount of such increase is likely to be based on "conjecture and guess work"105, 
it is necessary to add a requirement regarding the likelihood of default by individual importers in 
order to render an additional security such as the EBR "reasonable" under the Ad Note. 
4. "As Such" Consistency of the Amended CBD with Articles 1 and 18.1 of the 
Anti-Dumping Agreement  and Articles 10 and 32.1 of the SCM Agreement  
97. India recalls the grounds on which the Panel ma de its findings, and accepts that its "as such" 
claims on appeal "can succeed only if the Appellate  Body agrees with India that the requiring of 
security between the final determination and the fi nal assessment review under the retrospective duty 
assessment system is not authorized by the Ad Note".106  India argues that, if the Appellate Body were 
to reverse that finding of the Panel, its othe r finding that the Amended CBD is a discretionary 
measure "cannot stand in the way of India's 'as such' claims under Articles 1 and 18.1 of the Anti-
Dumping Agreement".107  India offers a number of reasons to substantiate its claim.  Article 18.4 of 
the Anti-Dumping Agreement  and Article  32.5 of the SCM Agreement  require Members to bring their 
laws into conformity with their obligations unde r these Agreements, as recognized in the Appellate 
Body Report in US – Corrosion-Resistant Steel Sunset Review .108  Further, if discretionary measures 
could not be challenged "as such", anti-dumping and countervailing duty legislation or regulations 
(such as the United States Antidumping Act of 1916109) would never be subject to challenge since 
they are inherently discretionary in character.  India contends that Members should not be permitted 
to avoid obligations to bring their laws into c onformity by couching obligations in non-mandatory 
terms.  The Appellate Body also has recognized th is by stating that the mandatory/discretionary 
distinction should not be applied "m echanistically" but with caution.110  Finally, India refers to 
                                                      
104Panel Report, US – Customs Bond Directive , footnote 148 to para. 7.119.   
105India's appellant's submission, US – Customs Bond Directive , para. 135.  
106Ibid., para. 84.  
107Ibid. 
108Ibid., para. 85 (referring to Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review , 
para. 87). 
109Title VIII (under the heading "Unfair Competition" ) of the United States Revenue Act of 1916, 
39 Stat. 756 (1916). 
110See India's appellant's submission, US – Customs Bond Directive , paras. 87 and 88 (referring to 
Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review , paras. 81 and 82;  and Appellate Body 
Report, US – 1916 Act , para. 91).   WT/DS343/AB/R 
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"numerous admissions"111 by the United States that United St ates Customs is bound to impose the 
EBR on every occasion where it considers the cash deposits  to be inadequate to meet likely increases 
in final liability for anti-dumping or count ervailing duties in assessment reviews.  
98. India's "as such" claims on appeal are premised on its view that requiring a security between 
the imposition of the definitive anti-dumping duty order and the assessment of anti-dumping duties is 
not authorized by the Ad Note.  Therefore, India reasons, every time the United States resorts to the 
EBR, it would be an impermissible specific action against dumping or subsidization, with the 
implication that the Amended CBD is WTO-inconsistent "as such".   
5. Consistency of the Amended CBD with Article 9 of the Anti-Dumping 
Agreement  and Article 19 of the SCM Agreement   
99. India appeals the findings of the Panel as re gards the interpretation of Article 9 of the Anti-
Dumping Agreement  and Article 19 of the SCM Agreement , and refers primarily to the Panel's 
interpretation of Article 9, which formed part of its contextual analysis of the Ad Note.112  In 
particular, India challenges the Panel's finding th at neither the EBR nor cash deposits imposed by 
Members with a retrospective duty assessment system ar e subject to the disciplines of Article VI:2 of 
the GATT 1994 and Article 9 of the Anti-Dumping Agreement ;  or Article VI:3 of the GATT 1994 
and Article 19 of the SCM Agreement .   
100. First, India contends that the Panel read in to Article 9 a right to impose security after 
imposition of a definitive anti-dumping duty order,  when the wording of Article 9.1 through 
Article 9.5, and the specific reference to the impos ition and collection of "duties", make it clear that 
Article 9 intends to exclude any other rights.  Seco ndly, India claims that the Panel erred in assuming 
that, because Article 9.3.1 "authorizes" retrosp ective duty assessment systems, it was necessary for 
the Panel to interpret it in the way the Panel did.  India contends that the scope of Article 9.3.1 is 
"extremely limited"113 and is meant to impose restrictions  on the operation of retrospective duty 
assessment systems, as is clear from its negotiating  history.  Thirdly, as submitted by the United 
States in other WTO disputes, cash deposits are consid ered "duties" for purposes of Article 9.  India 
contends that the right to collect duties permits only the collection of cash deposits not in excess of 
the margin of dumping, and does not permit the United  States to collect duties in excess of the margin 
of dumping, even during the period between the anti- dumping duty order and the  assessment review.   
                                                      
111See India's appellant's submission, US – Customs Bond Directive , para. 91, where India lists these 
"numerous admissions" by the United States. 
112Ibid., para. 98 (referring to Panel Report, US – Customs Bond Directive , paras. 7.97, 7.100, 7.101, 
7.106, 7.117, and 7.159-7.161). 
113Ibid., para. 105.  WT/DS343/AB/R 
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101. Based on these arguments, India requests the Appellate Body to reverse the Panel's findings, 
and to find, instead, that the Amended CBD is in consistent both "as such" and "as applied" with 
Articles 9.1, 9.2, 9.3, and 9.3.1 of the Anti-Dumping Agreement ;  and "as such" with Articles 19.2, 
19.3, and 19.4 of the SCM Agreement . 
6. Completing the Analysis on Article 18.4 of the Anti-Dumping Agreement  and 
Article 32.5 of the SCM Agreement   
102. In the event the Appellate Body reverses the Pa nel's findings with respect to India's "as such" 
claims under Articles 1, 9.1, 9.2, 9.3, 9.3.1, and 18.1 of the Anti-Dumping Agreement , and under 
Articles 10, 19.2, 19.3, and 19.4 of the SCM Agreement , India requests the Appellate Body to 
complete the analysis and find that the Amended CB D is "as such" inconsistent with Article 18.4 of 
the Anti-Dumping Agreement  and Article 32.5 of the SCM Agreement , respectively. 
7. The Panel's Terms of Reference  
103. India appeals the finding of the Panel that Section 1623 of the United States Tariff Act of 
1930114 (the "Tariff Act") and Section 113.13 of the United States Code of Federal Regulations  (the 
"United States Regulations") were not within the scope  of the measure at issue, and were not part of 
the Panel's terms of reference, because they ar e "separate and legally distinct" from the Amended 
CBD.   
104. India submits that, in making this finding, th e Panel ignored previous statements of the 
Appellate Body that establish that there is no re quirement for a "precise and exact" identity between 
the measures identified in the consulta tions request and the panel request.115  India refers to previous 
Appellate Body Reports that caution against subs tituting the consultations request with the panel 
request because it is the latter that est ablishes a panel's terms of reference.116   
105. India notes that it is undisputed that Section 1623 of the Tariff Act and Section 113.13 of the 
United States Regulations were specifically mentioned in the panel request.  Indi a refers to the Panel's 
                                                      
114Supra , footnote 53. 
115India's appellant's submission, US – Customs Bond Directive , para. 119 (referring to Appellate Body 
Report, US – Upland Cotton , para. 285;  and Appellate Body Report, Brazil – Aircraft , para. 132).  
116Ibid., para. 129 (referring to Appellate Body Report, US – Upland Cotton , para. 285).  WT/DS343/AB/R 
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reliance on the Appellate Body Report in US – Certain EC Products  when it asserted that mere 
reference in a panel request does not mean that a me asure falls within the panel's terms of reference.117   
106. India contrasts the factors relevant to the Appellate Body's finding in US – Certain EC 
Products , that the two measures in question were legally distinct118, with the factors identified by the 
Panel in this case.  India claims that the Panel erred by not considering that India had challenged 
Section 1623 of the Tariff Act and Section 113.13 of  the United States Regulations only "to the extent 
that they authorize the EBR", which was a challe nge narrower than assumed by the Panel.  A finding 
of violation, therefore, would only require the United States to ensure that Section 1623 of the Tariff 
Act and Section 113.13 of the United States Regul ations do not extend to taking bonds to secure 
payment of anti-dumping and countervailing duties.  Fu rther, India contends that there is no dispute 
that Section 1623 of the Tariff Act and Section 113.13  of the United States Regulations grant the legal 
authority to impose the EBR, specifi cally, to secure revenue collection.  Therefore, to the extent that 
the provisions listed and the arguments in Indi a's consultations request concerned the WTO-
consistency of the EBR, the measures consulted on would certainly include Section 1623 of the Tariff 
Act and Section 113.13 of the United States Regulations.  
107. For these reasons, India requests the Appellate Body to reverse the Panel's finding that 
Section 1623 of the Tariff Act and Section 113.13 of the United States Regulations were not within 
the scope of the Panel's terms of reference. 
                                                      
117India's appellant's submission,  US – Customs Bond Directive , para. 123 (referring to Panel Report, 
US –  Customs Bond Directive , para. 7.183).  India explains that, in the US – Certain EC Products  case, the 
Appellate Body was required to determine whether a measure taken by the United States Trade Representative 
on 19 April 1999 (the "19 April Measure") that imposed 100 per cent duties on imports of certain products from the European Communities was within its terms of reference, in addition to a measure taken by United States 
Customs that imposed increased bonding requirements on 3  March 1999 (the "3 March Measure").  According 
to India, the reason that the Appella te Body did not accept the 19 April M easure as falling within its terms of 
reference was not because it was not included in the consu ltations request;  rather, the main reason was that the 
European Communities had failed to specify clearly and expressly the 19 April Measure in its panel request.  
Furthermore, the complaint was about the increase in bonding requirements under the 3 March Measure, not the 
imposition of additional duties under the 19 Apr il Measure. (India's appellant's submission, US – Customs Bond 
Directive , paras. 121 and 122 (referring to Appellate Body Report, US – Certain EC Products , para. 70)) 
118Ibid., para. 125.  India refers to the fact that the duties imposed by the 19 April Measure were an 
additional 100 per cent, whereas the 3 March Measure provi ded for increased bonding requirements.  Further, 
India notes that the number of products covered by the respective Measures varied;  that separate agencies acting under distinct legal authorities were involved;  that the earlier Measure did not require the imposition of 
100 per cent duties in the later measure and that the legal bases for the two Measures were distinct;  and that 
neither Measure required action similar to that contemplated by the other.   WT/DS343/AB/R 
WT/DS345/AB/R Page 40 
 
 
8. The Availability of a Defence under Article XX(d) of the GATT 1994 to the 
United States  
108. India appeals the Panel's decision not to address "as a threshold question" whether 
Article XX(d) of the GATT 1994 remains available to justify a specific action against dumping or 
subsidization, and requests the Appellate Body to co mplete the analysis in this regard.  Specifically, 
India considers that the United States could not assert "two mutually inconsistent defences"119, 
namely, defending simultaneously the E BR as being consistent with the Ad Note to Article VI:2 and 3 
of the GATT 1994, as well as that the EBR cons tituted non-specific action to secure payments of 
duties under Article XX(d).  India bases its argument on the statement of the Appellate Body in US – 
Offset Act (Byrd Amendment)  that, for purposes of Article 18.1 of the Anti-Dumping Agreement , a 
measure can be either a "specific action against dumpi ng" as referred to in Article 18.1, or a general, 
"non-specific action" under footnote 24 to Article 18.1.  Thus, according to India, the United States 
was required to invoke the footnote before justifyi ng the EBR under Article XX(d).  India contends 
further that Article VI of the GATT 1994, the Ad Note, and the Anti-Dumping Agreement  constitute a 
"complete, self-contained code" according to wh ich anti-dumping measures must be applied.  
Accordingly, a measure that does not comply with an y of the provisions relating to Article VI of the 
GATT 1994 read in conjunction with the Anti-Dumping Agreement  must be held to be inconsistent 
with the relevant provisions of these Agreements.  Any interpretation that permits Members to justify 
impermissible specific actions against dumpi ng under Article XX(d) would render "inutile" 
Article 18.1 of the Anti-Dumping Agreement .120 
9. Prima Facie  Case by the Panel under Article XX(d) of the GATT 1994  
109. India argues that, in the event the Appellate Body finds that Article XX(d) of the GATT 1994 
remained available to the United St ates to justify the EBR, the Appe llate Body should find that the 
Panel acted inconsistently with its obligations under Article 11 of the DSU to make an objective 
assessment of the matter before it in evaluating the United States' defence. 
110. India contends that the Panel supplemented the case of the United States by including 
provisions not cited by the United States, and conc luding that, "for the purpose of considering the 
United States' defence under Article XX(d), the law or  regulation at issue", for which it is "necessary 
to secure compliance", is Section 1673e(a)(1) of the Tariff Act, read together with 
Sections 1673e(b)(1) and 1673 of the Tariff Act and Sections 351.212(b)(1) and 351.211(c)(1) of the 
United States Regulations, "all of which together  govern the final collection of anti-dumping or 
                                                      
119India's appellant's submission, US – Customs Bond Directive , paras. 141 and 142.  
120Ibid., paras. 144 and 145.   WT/DS343/AB/R 
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countervailing duties".121  India considers this expansion of la ws and regulations to be unacceptable in 
the light of the fact that the United States had limited its claim to —and "relied solely on"122—
Section 1673e(a)(1) of the Tariff Act.   
111. India submits that, in expanding the reference of the United States beyond 
Section 1673e(a)(1) of the Tariff Act, the Panel made a  prima facie  case for the United States.  India 
therefore requests the Appellate Body to find that the Panel should have dismissed the defence of the 
United States under Article XX(d) of the GATT 1994, and further to find that the Panel violated 
Article 11 of the DSU.   
F. Arguments of the United States – Appellee in US – Customs Bond Directive 
1. Ad Note to Article VI:2 and 3 of the GATT 1994  
112. The United States requests the Appellate Body to reject India's appeal of the Panel's 
interpretation of the Ad Note in relation to the Anti-Dumping Agreement .  The United States contends 
that:  India's arguments ignore the immediate c ontext of the words "suspected dumping" in the Ad 
Note;  India treats the reference to "duty" as being synonymous with "cash depo sit";  India renders the 
provisions of Article VI of the GATT 1994 (and the Ad Note) inutile by suggesting that the Anti-
Dumping Agreement  supersedes the GATT 1994;  and India tr eats statements in previous Appellate 
Body reports as dispositive of the interpretation of the Ad Note, when those reports were not 
concerned with the Ad Note or security requirements for anti-dumping duties. 
113. The United States notes that one of the central  questions before the Panel was whether any 
provisions of the  Anti-Dumping Agreement  or the GATT 1994 apply to a security requirement such 
as that contemplated by the EBR for the payment of an anti-dumping duty after  an anti-dumping duty 
order has been imposed.  The United States agrees with the Panel that the Ad Note applies and is the 
sole provision that limits security  requirements of this type.   
114. More specifically, the United States argues that th e phrase "final determination of the facts" in 
the Ad Note refers, in the context of a retrospectiv e duty assessment system, to the determination of 
the "final liability for payment of anti-dumping dut ies" as provided for in Article 9.3.1 of the Anti-
Dumping Agreement .  Therefore the "final determination of the facts" in the Ad Note follows an 
assessment review under Article 9.3.1.  The United Stat es considers this interpretation to be consistent 
with the references in the Ad Note to "security ... for ... paymen t" and "other cases in customs 
                                                      
121India's appellant's submission, US – Customs Bond Directive , para. 149 (quoting Panel Report, US – 
Customs Bonds Directive , para. 7.300). 
122Ibid. WT/DS343/AB/R 
WT/DS345/AB/R Page 42 
 
 
administration".  As in other cases in customs ad ministration, security is required upon entry of 
merchandise, when the actual amount of liability is no t known, until the liability is finally determined 
and duties assessed and paid.  Furthermore, Article VI:2 and 3 of the GATT 1994 addresses the 
"levy[ing]" of anti-dumping and countervailing duti es, and this term used in Article 4.2 (and 
footnote 12 thereto) of  the Anti-Dumping Agreement  refers to the "definitive or final legal assessment 
or collection of a duty or tax".  Thus, the "final determination" in the Ad Note extends to security 
pending final legal assessment of duties, which, in retrospective duty assessment systems, does not 
occur when the anti-dumping duty order is imposed;  rather, it occurs when final duty liability is 
assessed. 
115. The United States submits that ther e is contextual support in the Anti-Dumping Agreement  for 
the Panel's interpretation.  Article 9.3 requires that the anti-dumping duty not exceed the margin of 
dumping established under Article 2 of the Anti-Dumping Agreement .  The United States considers 
that the cash deposit and the enhanced bond secure pa yment of this amount of duty and ensure the 
ability of the United States to collect this amount of duty in accordance with Article 9.2.  The United 
States notes that the reference in Article 9.3.1 to "f inal" liability coincides with the use of the term 
"final" determination of the facts in the Ad Note. 
116. The United States rejects India's argument that the imposition of an anti-dumping duty order 
means that dumping is no longer "suspected" and that, therefore, the Ad Note does not address 
security for the payment of anti-dumping duties if that  security is required after the order is imposed.  
The United States contends that India's argument is  based on its misunderstanding of the term "final 
determination" in the Ad Note, which, as the Panel correctly found , refers to the final determination 
with regard to the "payment" of the duty.  Furthe r, the Panel's discussion of the "levying" of duties 
accords with the United States' view, and not Indi a's, that the "final determination" is the 
determination "that precedes the imposition of the decision under Article 9.1".
123  The United States 
rejects India's characterization of the Panel's analysis as "purposive"124;  rather, the Panel interpreted 
the text and applied it to the facts of the case insofa r as they relate to a retrospective duty assessment 
system.  Finally, the United States disagrees that the Panel's reasoning creates "disparities"125 between 
retrospective and prospective duty assessment systems;  in the United States' view precluding Members with retrospective systems from requiring th e posting of security prior to the determination 
of final liability would prevent such Members from collecting duties lawfully owed.  
                                                     
 
123United States' appellee's submission, US – Customs Bond Directive , para. 15 (referring to India's 
appellant's submission,  US – Customs Bond Directive , para. 63).  
124Ibid., (referring to India's appellant's submission,  US – Customs Bond Directive , para. 68).  
125Ibid., para. 16 (referring to India's appellant's submission,  US – Customs Bond Directive , para. 67).  WT/DS343/AB/R 
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117. The United States further argues that the Panel properly found that the Anti-Dumping 
Agreement  does not prohibit security requirements such as the EBR, if they are "reasonable".  As to 
the relationship between the Anti-Dumping Agreement  and the Ad Note, the United States agrees with 
the Panel's reliance on the Panel and Appellate Body Reports in Brazil – Desiccated Coconut  in 
finding that, where the Ad Note authorizes a conduct and the Anti-Dumping Agreement  confirms that 
such conduct is not prohibited by it, there is no basis for prohibiting such conduct.126  The United 
States rejects India's approach, whic h suggests that the silence of the Anti-Dumping Agreement  on an 
issue means that it is prohibited, even if expr essly permitted by the GATT 1994.  India's approach 
would "read Article VI and the Ad Note out of the covered agreements entirely, depriving both 
provisions of any meaning."127  According to the United States, and as recognized by past panels and 
the Appellate Body, Article VI is part of the same treaty as the Anti-Dumping Agreement  and should 
not be interpreted to deprive it or the Anti-Dumping Agreement  of meaning.128  Neither the Appellate 
Body Report in US – Offset Act (Byrd Amendment) , nor in US – 1916 Act , supports the view that an 
action permitted by the Ad Note, and not addressed by the Anti-Dumping Agreement , is prohibited by 
Article 18.1 of the Anti-Dumping Agreement . 
118. In addition, the United States agrees with the Panel that Article 7 of the Anti-Dumping 
Agreement  does not address security requirements after th e imposition of an anti-dumping duty order.  
The United States considers that, since Article 7 does not address security requirements after the dumping determination is made, it cannot place limi tations on those requirements beyond the limited 
scope of application of the Ad Note.  India appears to belie ve that, because some security 
requirements are addressed by Article 7, all such requ irements must fall within the ambit of Article 7.  
Even if one were to accept India's view that Article 7 implements the Ad Note, this does not mean that 
security that is not provisional must necessarily comport with the Article 7 disciplines on provisional 
measures.  India itself appears to accept that Article 7 implements the Ad Note only "to the extent 
that" security is provisional.
129  
119. The United States argues further that the Panel properly found that Article 9 of the Anti-
Dumping Agreement  does not address security requirements.  First, contrary to India's assertion, the 
Panel did not "read into Article 9" the right to impose security;  rather, it merely found that such 
security is not prohibited by Article 9, which concerns duties, and not security.  The United States 
                                                      
126United States' appellee's submission, US – Customs Bond Directive , para. 17 (referring to Panel 
Report, US – Customs Bond Directive , paras. 7.73 and 7.74 and footnote 114 thereto, in turn referring to Panel 
Report, Brazil – Desiccated Coconut , para. 227 and footnote 60 thereto;  and Appellate Body Report, Brazil – 
Desiccated Coconut , p. 14, DSR 1997:I, 167, at 179). 
127Ibid., para. 18.  
128Ibid., (referring to Panel Report, US – 1916 Act (EC) , para. 6.97).  
129Ibid., para. 23 (referring to India's appellant's submission, US – Customs Bond Directive , para. 80). WT/DS343/AB/R 
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does not consider that India's reference to the maxim " expressio unius est exclusio alterius " is 
applicable since Article 9 does not conf er a right to impose and collect duties alone
130;  to the 
contrary, Article 9 does not address bonds or other security. 
120. Further, because, according to  the Untied States, cash deposits are not definitive "duties", 
India's argument would imply that they are prohibited.   For the United States, such a result is "far too 
much" and would suggest that the Anti-Dumping Agreement  supersedes the GATT 1994, contrary to 
the Appellate Body Report in Brazil – Desiccated Coconut .  Finally, the United States considers that 
India mischaracterizes the Panel's analysis of Articl e 9.3.1, which the Panel used only as context for 
its interpretation of the Ad Note, and not to find that Article 9.3.1 "authorized" retrospective duty 
assessment.131 
121. Finally, the United States argues that the Appellate Body Reports in US – 1916 Act  and US –  
Offset Act  (Byrd Amendment) should not be read to imply that a dditional security is prohibited.  As 
the Panel noted, these reports do not contain any analysis of the Ad Note, nor do they even discuss 
how Members could guard against a risk that one of the "permissible responses" to dumping might be circumvented.  For the United States, India's readi ng of those reports would alter the balance of rights 
and obligations in the covered ag reements, contrary to the DSU and the Appellate Body Report in 
Brazil – Desiccated Coconut .   
2. Cash Deposits and Anti-dumping Duties 
 
122. The United States supports the Panel's view th at a cash deposit is security for a duty owed, 
and is not itself a duty.  The United States agrees with  the Panel that, in contrast to a duty, a cash 
deposit is not liquidated revenue and has no "intrinsic value" until duties are assessed.  The United 
States also endorses the Panel's observation that th e retrospective duty assessment in Article 9.3.1 
would make no sense if "cash deposits" were duti es, since cash deposits are established on a 
prospective basis.  It also agrees with the Panel th at there is a textual difference between Articles 9.3.2 
and 9.3.1—the former refers to refunds of "duti es", whilst the latter refers only to "refund" without 
specifying what must be refunded—and that this textual difference supports the view that cash 
deposits are not duties.  Like the Panel, the United States notes that Article 7.2 distinguishes a cash  
                                                      
130United States' appellee's submission, US – Customs Bond Directive , para. 26 (referring to India's 
appellant's submission, US – Customs Bond Directive , paras. 101 and 102).  
131Ibid., para. 28 (referring to India's appellant's submission, US – Customs Bond Directive , para. 104).   WT/DS343/AB/R 
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deposit as a form of security from duties, and agrees w ith the Panel that, in indicating a preference for 
requiring payment of cash deposits, rath er than duties, the text of Article 7.2 establishes a substantive 
difference between a cash deposit and a duty.  
123. The United States does not consider that the st atements it made to the Negotiating Group on 
Rules, and in other dispute settlement proceedings re ferred to by India, provide a basis to depart from 
the ordinary meaning of the terms used in the covered agreements. 
124. The United States considers that India attaches too much significance to the Appellate Body's 
statement in US – Zeroing (Japan)  that "an administering authority may collect duties, in the form of 
a cash deposit".132  As the Panel found, in US – Zeroing (EC) , the Appellate Body did not address the 
issue of whether cash deposits are duties, and Indi a's suggestion that the Appellate Body Report in 
US – Zeroing (EC)  is less significant because the Appellate  Body's description was based on the 
underlying panel report, should be rejected.  The United States further argues that India fails to 
address many arguments relied on by the Panel, incl uding its analysis of Articles 7 and 9.3 of the 
Anti-Dumping Agreement , and the requirement that the amount of anti-dumping duty "not exceed the 
margin of dumping".  For the same reasons, the Unit ed States considers that India's argument that the 
EBR is inconsistent with Articles 9.1, 9.2, and 9.3 of the Anti-Dumping Agreement , should be 
rejected. 
3. The Reasonableness of the EBR, as Applied to Subject Shrimp  
125. Whilst the United States agrees with India that the risk of default may be among the factors 
that are relevant to determining whether any addition al security is "reasonable" within the meaning of 
the Ad Note, it disagrees with the assertion of India th at the likelihood of default for a particular 
importer must be taken into account in assessing the reasonableness of a security.  According to the 
United States, the text of the Ad Note does not suggest that "reasonableness" requires an importer-
specific assessment of default risk.  The United States adds that assessing the risk of default for 
individual importers would imply practical diffi culties, as United States Customs cannot conduct an 
assessment of individual risk without collecti ng information from the importer and cannot wait until 
an importer defaults.  The United States considers, ho wever, that the risk of default in case of increase 
in the dumping rate may be considered in a ssessing whether requiring additional security is 
                                                      
132United States' appellee's submission, US – Customs Bond Directive , para. 31 (referring to Appellate 
Body Report, US – Zeroing (Japan) , para. 156). WT/DS343/AB/R 
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reasonable.  According to the United States, factor s such as the industry's characteristics, the ability 
to  pay, or the compliance history may be relevant  to determine the risk of default.  The United 
States  notes that, with respect to shrimp importers, United States Customs concluded that:  
agriculture/aquaculture industries we re characterized by low capitalization and high debt-to-equity 
ratios;  importers of this type of  merchandise had been responsible for significant defaults in the past;  
and shrimp importers of merchandise were therefore lik ely to have a heightened risk of default due to 
similarities with these other agri culture/aquaculture importers.  For the United States, because the 
Panel failed to consider the evidence that it provided  regarding risk of default with respect to the 
importers of shrimp subject to anti-dumping duties,  it could not have known whether the risk of 
default was such that additional security was "reasonable". 
4. "As Such" Consistency of the Amended CBD with Articles 1 and 18.1 of the 
Anti-Dumping Agreement  and Articles 10 and 32.1 of the SCM Agreement  
126. The United States agrees with the reasoning by the Panel in rejecting India's claim that the 
Amended CBD is "as such" inconsiste nt with Articles 1 and 18.1 of the Anti-Dumping Agreement  and 
Articles 10 and 32.1 of the SCM Agreement .  The United States considers that India's assertion that 
anti-dumping duties and countervailing duties are "inherently discretionary"133 is both inaccurate and 
a non sequitur , as such measures have been considered by other panels and the Appellate Body to be 
mandatory.  For the United States, the relevant questi on is whether the particular characteristics of a 
measure require a Member to act inconsistently with  a given obligation in every instance, which, as 
the Panel found, the Amended CBD does not.  The alleged "admissions" of United States Customs 
cited by India reflect only the fact that United St ates Customs collects duties lawfully owed to the 
United States and, in certain instances, it may c onsider additional security necessary for doing so.  
Requesting the Appellate Body to find that the Amended CBD is inconsistent "as such" with the 
Ad Note on the grounds that it "could never provide legal cover for the [Amended CBD] even in 
principle and that every time the United States reso rts to it, it would be an impermissible specific 
action against dumping"134 begs the question whether the EBR requires WTO-inconsistent action.  
Finally, the United States considers India's reliance on US – Corrosion-Resistant Steel  Sunset Review  
to be "misplaced", because the issue here is not whether the relevant instrument—in this case the 
Amended CBD—is a "measure" (which was at issue in that case) but, rather, whether the Amended 
CBD "as such" violates various provisions of the Anti-Dumping Agreement . 
                                                      
133United States' appellee's submission, US – Customs Bond Directive , para. 40 (quoting India's 
appellant's submission, US – Customs Bond Directive , para. 86;  and referring to the panel and Appellate Body 
in Mexico – Anti-Dumping Measures on Rice ). 
134Ibid., (quoting India's appellant's submission, US – Customs Bond Directive , para. 90).   WT/DS343/AB/R 
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5. Consistency of the Amended CBD with Article 9 of the Anti-Dumping 
Agreement  and Article 19 of the SCM Agreement   
127. The United States agrees with the Panel's findings  that India's claims under Article 9 of the 
Anti-Dumping Agreement  and Article VI:2 of the GATT 1994 fail because the EBR, imposed 
pursuant to the Amended CBD, is not an anti-du mping duty.  Similarly, the claims under the 
"substantively similar" provisions of Article 19 of the SCM Agreement  and Article VI:3 of the 
GATT 1994 also must fail.  According to the United States, these Panel findings accord with the text 
of these Agreements and, without a "theory"135 by India on how the bond requirement is "as such" 
inconsistent with these provisions, the reasons give n by the Panel in rejecting India's arguments 
should be sustained. 
6. Completing the Analysis on Article 18.4 of the Anti-Dumping Agreement  and 
Article 32.5 of the SCM Agreement   
128. The United States notes that India's claims under Article 18.4 of the Anti-Dumping Agreement  
and Article 32.5 of the SCM Agreement  are conditional upon the Appellate  Body reversing the Panel's 
findings relating to India's "as such" claims under Articles 1, 9.1, 9.2, 9.3, 9.3.1, and 18.1 of the Anti-
Dumping Agreement  and Articles 10, 19.2, 19.3, 19.4, and 32.1 of the SCM Agreement .  As explained 
above, the United States submits that India fails to demonstrate on appeal that the EBR is "as such" 
inconsistent with these provisions, and the United States therefore requests the Appellate Body to 
reject this conditional appeal of India. 
7. The Panel's Terms of Reference  
129. The United States requests the Appellate Body to reject India's claims that the Panel erred in 
finding that Section 1623 of the Tariff Act and S ection 113.13 of the United States Regulations were 
not within the Panel's terms of refe rence.  The United States notes that, as conceded by India, neither 
measure was included in India's c onsultations request;  and further, these measures are "separate and 
legally distinct" from the Amended CBD.136  The United States submits, consistent with previous 
Appellate Body statements137, that the Panel carefully considered the relationship between 
Section 1623 of the Tariff Act and Section 113.13 of the United States Regulations, on the one hand, 
and the Amended CBD, on the other hand, in orde r to determine whether the two measures were 
"separate and legally distinct" from the Amended CB D.  In doing so, the Panel considered various
                                                      
135United States' appellee's submission, US – Customs Bond Directive , para. 43. 
136Ibid., para. 45 (referring to Panel Report, US – Customs Bond Directive , para. 7.193). 
137Ibid., (referring to Appellate Body Reports in Brazil – Aircraft , US – Upland Cotton , and US – 
Certain EC Products ).  WT/DS343/AB/R 
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factors, including the fact that, unlike the Amended CBD, these provisions do not specify the 
particular requirements relating to the imposition of continuous bonds or other types of security;  they 
relate to conditions and forms of bonds, and provi de more general authority to customs officers.  
However, the Panel did not think that the genera l authority to require additional bonds supported 
India's claims that the two measures were lega lly inseparable from the Amended CBD.  Further, 
according to the United States, India's theory would imply that laws and regul ations providing general 
"authority" to collect revenue would be implicated in  a dispute even if they were not mentioned in a 
consultations request.  The United States considers that  this would be directly contrary to Articles 4 
and 6 of the DSU. 
8. The Availability of a Defence under Article XX(d) of the GATT 1994 to the 
United States  
130. The United States submits that "nothing in the text of the covered agreements suggests that 
the United States was required to 'invoke' footnote 24 of the Antidumping Agreement in order to justify the EBR under Article XX(d)."
138  According to the United States, India's emphasis on 
footnote 24 is based on a misinterpretation of the Appellate Body Report in US – Offset Act (Byrd 
Amendment) .  In that case, the Appellate Body found that footnote 24 means that provisions other 
than Article VI of the GATT 1994 are not among the provisions "interpreted by" the Anti-Dumping 
Agreement  for purposes of analyzing Article 18.1;  however, in these proceedings, the relevant 
provision—the Ad Note—is  part of Article VI of th e GATT 1994, and nothing in the Appellate 
Body's reasoning suggests that footnote 24 precludes resorting to Article XX(d) to defend a measure 
found to be inconsistent with Article VI of the GATT 1994, or that footnote 24 places additional 
requirements in doing so.  The United States agrees with the Panel that Article XX(d) of the GATT 1994 does not "on its face" limit a panel from considering such a defence.
139  Moreover, India 
offers no explanation as to why a recognition of the availability of such a defence would render 
Article 18.1 of the Anti-Dumping Agreement  inutile. 
9. Prima Facie  Case by the Panel under Article XX(d) of the GATT 1994  
131. The United States argues that India's claim that the Panel "supplemented" the affirmative 
defence of the United States by expanding the "law s or regulations" for purposes of the defence under 
Article XX(d) of the GATT 1994 mischaracterizes the United States' arguments before the Panel.140   
                                                      
138United States' appellee's submission, US – Customs Bond Directive , para. 35. 
139Ibid., (referring to Panel Report, US – Customs Bond Directive , para. 6.13).  
140Ibid., para. 36 (referring to India's appellant's submission, US – Customs Bond Directive , 
paras. 147-155).   WT/DS343/AB/R 
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The United States submits that it did not refer "solel y" to Section 1673e(a)(1) of the Tariff Act as the 
relevant law or regulation;  ra ther, the United States argued that the Amended CBD is necessary to 
secure compliance with United States anti-dumping and countervailing duty assessment laws, "in 
particular", Section 1673e(a)(1) of the Tariff Act,  governing the assessment of anti-dumping duties, 
and general customs laws and regulations for pa yment of duties to the United States Treasury.  
Further, the United States notes that India itself iden tified some of the laws and regulations that the 
Panel relied on, and included, in its exam ination of the United States' defence. 
G. Claims of the United States – Other Appellant in US – Customs Bond Directive 
1. The Reasonableness of the EBR, as Applied to Subject Shrimp  
132. The United States explains that the EBR was developed for increasing security requirements 
regarding merchandise with a higher risk of default by  importers on final duty liability.  Past history 
had shown that importers of agriculture/aquacultu re merchandise were the source of the bulk of 
defaults, that anti-dumping rates increased in assessment reviews 38 per cent of the time, and that when rates increased, they did so  by an average of 285 per cent.  The United States underscores the 
fact that United States Customs applied the EBR to subject shrimp because the potential unsecured 
liability appeared significant (due to the fact that  shipments in excess of US$2.5 billion were subject 
to such orders), as did the risk of default (because the industry shared characteristics similar to those 
of other industries that, in the past, had been the source of substantial defaults). 
133. According to the United States, the Panel deve loped its own standard to determine whether 
the EBR as applied to subject shrimp constitutes "reasonable security" within the meaning of the 
Ad Note.  In considering that additional security  may only be "reasonable" if a WTO Member 
determines that the anti-dumping rate is "likely" to increase between imposition of the order and final 
assessment, the Panel adopted an incorrect standard .  This is because it would exclude bonding where 
there is less than "substantial certain ty" that such an increase will occur.
141  For the United States, the 
Panel's approach is contrary to the ordinary mean ing of the term "reasonable", and would imply that 
ordinary revenue collection strategies may not be a pplied to importers that are liable to anti-dumping 
duties. 
134. The United States considers that United States Customs' analysis as to whether additional 
security should be required is in line with ordinary customs practice, as United States Customs' 
decision to require additional security depends upon the amount of potential liability being secured
                                                      
141United States' other appellant's submission, US – Customs Bond Directive , para. 11. WT/DS343/AB/R 
WT/DS345/AB/R Page 50 
 
 
and the likelihood of default.  The United States expl ains that the potential additional liability depends 
on the likelihood of an increase in the margin of dump ing, the likely size of that increase, and the total 
value of shipments subject to that margin of dumpi ng.  The likelihood of default by importers, on the 
other hand, will be assessed in the light of factors such as industry characteristics, ability to pay, and 
compliance history.  Customs administrations do not merely secure liability that is determined to be "likely" to accrue;  the Panel's analysis is, ther efore, at odds with the textual reference in the Ad Note 
to "other cases in customs administration". 
135. The United States observes that the Panel asserte d that default risk is irrelevant to a 
determination of whether security is "reasonable".
142  According to the United States, risk of default is 
routinely taken into consideration by customs au thorities in establishing security requirements.  In 
fact, the risk of default was an important element of the analysis that led United States Customs to 
apply the EBR to subject shrimp.  The United States  considers that, "[i]f the evidence demonstrated a 
significant risk of default, the Panel should ha ve concluded that the security requirement was 
'reasonable', even if the likelihood of an increase [i n the anti-dumping rate] was less than 'substantial 
certainty'."143   
136. For the United States, the Panel's position—acco rding to which additional security may only 
be reasonable if the customs authorities show that the anti-dumping rate is "likely" to increase, and 
determine the likely amount of such increase—wo uld "limit 'reasonable security' to a calculation 
based on information that is impossible to know at the time the security is imposed."144  The United 
States argues that, to determine whether the EBR as applied to subject shrimp was "reasonable", the 
Panel should have considered the totality of the ev idence available at the time regarding the revenue 
risk against which the bond was secured.  According to the United States, this evidence included the 
likelihood of default, the amount of potential unsecu red liability, and the likelihood of rate increases. 
137. The United States therefore requests the Appellate Body to reverse the Panel's finding that the 
EBR, as applied to subject shrimp, is not a "reasona ble security" and that it is not consistent with the 
Ad Note. 
2. The Panel's Analysis of the Term "Necessary" under Article XX(d) of the 
GATT 1994  
138. Should the Appellate Body not reverse the Pane l's interpretation of the reasonableness of the 
security under the Ad Note, the United States requests the Appellate Body to reverse the Panel's 
                                                      
142Panel Report,  Customs Bond Directive , footnote 148 to para. 7.119.  
143United States' other appellant's submission, US – Customs Bond Directive , para. 14 . 
144Ibid., para. 17.  WT/DS343/AB/R 
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finding that, unless a Member demonstrates that rates subject to the anti-dumping duty order "are 
likely to increase", an additional security requiremen t cannot be considered to be "necessary" within 
the meaning of Article XX(d) of the GATT 1994, and to complete the analysis with respect to the 
chapeau of Article XX(d). 
139. The United States submits that the test used by  the Panel to determine the necessity of the 
EBR for purposes of Article XX(d) was the same as the one it used to evaluate the "reasonableness" 
of the security under the Ad Note.  According to the United States,  that test provides "no insight", 
since security may be "necessary" even  where there is a "likelihood" that liability will accrue, but it is 
not "likely" (in the sense of "substantial certainty") that it will do so.145   
140. The United States recalls that the application of  the EBR to subject shrimp was necessary due 
to the significant potential unsecured liability and th e significant default associated with entries of 
similar merchandise in the past.  According to the United States, requiring additional security pending 
final determination of duties ow ed is a standard approach among WTO Members to address the 
problem of potential unsecured duty liability pending final assessment.  The United States argues that 
the Panel failed to take into account the fact that  United States Customs adopted a tailored process for 
evaluating risk and bond amounts, in which the bond amount required of an im porter reflects that 
importer's actual ability to pay duties lawfully owed, and thus the "necessity" of any additional 
security.146  Further, the United States claims th at India has not identified any "reasonable 
alternatives" to the EBR that would address the spec ific problem faced by United States Customs, nor 
did the Panel find that any such alternatives existed.   In fact, the possible WTO-consistent alternatives 
cited by the complaining parties—including the cash  deposit requirement, civil recovery proceedings, 
and the basic bond requirement—were already in eff ect when United States Customs experienced its 
non-collection problem.  Finally, the United States contends that the EBR m eets the requirements of 
the chapeau of Article XX and requests the Appellate Body to complete the analysis, given that there 
is sufficient evidence in th e record to do so;  and also to find  that the EBR is "necessary" to enforce 
relevant United States anti- dumping laws and regulations. 
H. Arguments of India – Appellee in US – Customs Bond Directive 
1. The Reasonableness of the EBR, as Applied to Subject Shrimp  
141. Without prejudice to India's contention that the Ad Note does not permit the United States to 
take security in addition to cash deposits in th e period between the imposition of an anti-dumping 
                                                      
145United States' other appellant's submission, US – Customs Bond Directive , para. 21.   
146Ibid., para. 22. WT/DS343/AB/R 
WT/DS345/AB/R Page 52 
 
 
duty order and an assessment review, India requests th e Appellate Body to reject the United States' 
arguments regarding the Panel's test of reasonableness under the Ad Note and, further, to uphold the 
Panel's finding that the EBR as applied to subject sh rimp is inconsistent with the provisions of the 
Ad Note and Article 18.1 of the Anti-Dumping Agreement . 
142. In India's view, and as the Panel found, th e evidence submitted by the United States was 
inadequate to support its position that, at the time of the imposition of the EBR, it could be said that 
margin rates were likely to rise.  In  this regard, India refers to the Panel's findings, including:  that the 
United States had not provided relevant documentary  evidence that rates increased 33 per cent of the 
time even for agricu lture/aquaculture cases
147;  that the only evidence before United States Customs 
related to rate fluctuations for crawfish;  that it had not been proven that rate increases were not 
attributable to error or fraud;  and that the Unite d States could not explain how, based on historical 
trends for agriculture/aquaculture, dumping rates on subject shrimp would increase.  Further, India 
contends that the evidence put forward by the United States on appeal constitutes ex post  
rationalization. 
143. India contends that the United States' test for reasonableness would in fact endorse the test 
adopted by the Panel.  According to India, the t est put forward by the United States suggests that the 
total value of imports is the most important com ponent of its reasonableness test.  For India, given 
that the cash deposits collected by United States Cust oms already cover the full extent of the dumping 
rates specified in the order, the most important factor for determining reasonableness must, rather, be whether the rates are likely to increase and the lik ely amount of such increase s.  In the absence of 
such determination, security is not at all permissi ble regardless of the total value of imports and the 
consequent potential for importers to default.  India notes that, in contrast to the exporter-based test of 
reasonableness used by the Panel, the United States' test is importer-focused, and is based solely or 
mainly on the magnitude of potential unsecured liabilit y and likelihood of default.  In India's view, 
accepting the United States' test would mean that the United States could impose security 
requirements simply because the value of the imports is high and the structure of the import industry 
is suspect, even if there is no likelihood of increases in dumping margins.  
144. India argues that, even if the Pane l's test is permissible under the Ad Note, United States 
Customs is not the appropriate authority to determ ine the likelihood of rate increase or the amount of 
that increase.  Whilst the reference to  "customs administration" in the Ad Note suggests that, at the 
time the Ad Note was drafted, customs authorities collected anti-dumping duties, today, specialized 
                                                     
 
147On appeal, the United States contes ts this finding, arguing that its evidence demonstrated that rates 
increased 38 per cent of the time.  WT/DS343/AB/R 
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authorities with relevant expertise conduct inves tigations for determining dumping margins and per-
unit subsidization.148  India underlines that the reference to "customs administration" in the Ad Note 
predates the other WTO agreements and is no long er relevant in the light of the disciplines on 
provisional measures under Article 7 of the Anti-Dumping Agreement  and Article 17 of the SCM 
Agreement .  In India's view, it is clear that Members di d not envisage that "ordinary customs practice" 
would apply and govern the taking of security pr ior to the final determination of dumping and 
subsidization.   
145. India questions how the United States' and the Pa nel's test of reasonableness squares with the 
requirement in Article 2 of the Anti-Dumping Agreement , and the comparable provision of the SCM 
Agreement , and whether it would be necessary to un dertake a company-specific and exporter-wide 
analysis of dumping or subsidization.  In India' s view, rather than a "counter-factual" analysis, the 
Panel's test requires projection into the future.  In dia adds that the test of reasonableness should be 
applied at a company-specific level and that the analysis of likely dumping should be on an exporter-specific basis.  India agrees with  the Panel that the evidence to s upport likely rate increases should be 
specific to subject shrimp and cannot be based on gene ralized historical trends, such as those relevant 
to the wider agriculture/aquaculture cases.   
146. India submits that the Panel never stated that its interpretation of "likely" increase in dumping 
margins meant "substantial certainty" of such increa se.  India notes that the dictionary meaning of 
"certain" is "defined, fixed;  not variable" and "d efinite, precise, exact" and that, given that the Panel 
found that the taking of security under the Ad Note must be based on a prospective determination, it is 
clear that "certainty" about the future is impossible,  and that the Panel did not intend this standard to 
apply.
149 
147. India notes, however, that the test of "likely" increase adopted by the Panel is stricter than a 
mere "reasonabl[y] possible" or "reasonable chance" standard150, but that, even under this standard, 
the United States' test fails, bearing in mind that cash deposits are already applied to the full extent of  
                                                      
148In the case of the United States, it is the United Stat es Department of Commerce that has the role, as 
notified to the WTO by the United States under Article 16.5 of the Anti-Dumping Agreement  and Article 25.12 
of the SCM Agreement .  India refers to the Panel's reference in its  analysis to "investigating authority". (India's 
appellee's submission,  US – Customs Bond Directive , para. 42) 
149India's appellee's submission, US – Customs Bond Directive , para. 49 (referring to, for instance, 
United States' other appellant's submission, US – Customs Bond Directive , paras. 11, 13, 15, and 16). 
150Ibid., para. 51. WT/DS343/AB/R 
WT/DS345/AB/R Page 54 
 
 
the dumping margin specified in the order.  India contends that both aspects of the Panel's test of 
reasonableness—that an increase in  rates must be "likely";  and the "likely" amount of such 
increase—must meet the standard of proof required by  the meaning of the term "likely", which should 
correspond to "having an appearance of truth or fact" or be "probable".
151   
148. India submits that the Panel correctly applied the dictionary meaning of the term "reasonable" 
when it reasoned that an increased security such  as the EBR would not be viewed as "reasonable" 
unless the rate of dumping was likely to increase.  For India, it is not sufficient to establish a 
propensity for an increase in the rate of dumping in order to conclude that a security is "reasonable" 
under the Ad Note.  India agrees with the Panel that the  determination of the likely amount of 
increase in the rate of dumping is necessary because,  unless that amount has been established, it 
would not be reasonable to depart from the "best and only available baseline proxy of duties that may 
ultimately be assessed".152 
149. India also rejects the argument of the United St ates that the Panel's reference to a "case of 
suspected dumping" cannot be read to limit "reasonable security" to a calculation based on information that is impossible to know at the time security is imposed.
153  India considers that, just as 
WTO Members have developed their own test of proving recurrence of dumping under Article 11.3 of 
the Anti-Dumping Agreement , it is possible for the United States to meet the standard of 
reasonableness under the Ad Note. 
150. Finally, India rejects the United States' ar guments regarding possibility of "multiple 
'reasonable' security requirements" that are permissible under the Ad Note.154  W h i l s t  t h e  
interpretation of "reasonable" should depend on the facts of a case, this does not mean that there are 
multiple standards for determining when a particular  action is reasonable or not.  Furthermore, the 
United States' argument that, under the Ad Note, the different risk thresholds acceptable to different 
Members should be taken into account is a " non sequitur "155, since, regardless of a particular 
Member's risk preference, it would never be permissible to take security where it is not reasonable to  
                                                      
151India's appellee's submission,  US – Customs Bond Directive , paras. 51 and 53 (referring to The New 
Shorter Oxford English Dictionary , 4th edn, L. Brown (ed.) (Clarendon Press, 1993), Vol. 2, p. 1588).  
152Ibid., para. 55 (quoting Panel Report, US – Customs Bond Directive , para. 7.118, in turn quoting 
United States' first written submission to the Panel in US – Customs Bond Directive , para. 37). 
153Ibid., para. 56 (referring to United States' other appellant's submission, US – Customs Bond 
Directive , para. 17). 
154Ibid., para. 58 (referring to United States' other appellant's submission, US – Customs Bond 
Directive , para. 15). 
155Ibid.  WT/DS343/AB/R 
 WT/DS345/AB/R 
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do so.  India submits that the standard of reasona bleness must be objective, which, in certain cases 
might permit multiple determinations of reasonableness.  Therefore, in India's view, it was incorrect 
for the United States to suggest that the Pa nel adopted a "one-size-fits-all" approach.156 
2. The Panel's Analysis of the Term "Necessary" under Article XX(d) of the 
GATT 1994  
151. In support of its view that the EBR is not "n ecessary" within the meaning of Article XX(d) of 
the GATT 1994, India refers to the arguments it ma de in relation to the issue of what constitutes 
"reasonable security" under the Ad Note.  In particular, India reite rates its views that the Panel's 
approach was not premised on the standard of "substa ntial certainty" that rates were likely to increase, 
and that the United States did not bring relevant and persuasive evidence showing that rates were 
"likely" to increase for subject shrimp.  Indi a further submits that it identified "reasonable 
alternatives" to the EBR, such as quicker comple tion of assessment reviews as a means to lower the 
non-collection risk. 
152. Further, India argues that imposing the EBR on all importers, based on the total value of 
imports and the risk of default if rates were to incr ease, has no objective basis.  For India, even if rates 
increased by 285 per cent, as suggested by the United States, for only some importers, the imposition 
of the EBR on all shrimp importers would not gu arantee the collection from those whose margins 
increased.  Importers whose rates did not increase w ould be unnecessarily burdened by the EBR and 
suffer disastrous consequences.  In India's view , this constitutes "arbitrary" discrimination and 
operates as a "disguised restriction on trade" contrary to the chapeau of Article XX.  Although the 
United States requests the Appellate Body to comple te the analysis under the chapeau, India considers 
that there are no "uncontested facts" on the record , and that the Appellate Body should therefore not 
accede to this request.   
I. Arguments of the Third Participants 
1. Brazil  
153. Brazil argues that the Panel's interpretation of the Ad Note is "fundamentally flawed"157 and 
that the Appellate Body should rule  that the temporal scope of the Ad Note is limited to the original 
investigation and that the Ad Note does not authorize the application of bonds or other special security  
                                                      
156India's appellee's submission,  US – Customs Bond Directive , para. 60 (referring to United States' 
other appellant's submission, US – Customs Bond Directive , para. 12). 
157Brazil's third participant's submissions, US – Shrimp (Thailand) , US – Customs Bond Directive , 
para. 6.  WT/DS343/AB/R 
WT/DS345/AB/R Page 56 
 
 
requirements, such as the EBR, after the imposition of an anti-dumping duty order.  Brazil highlights 
that Article VI of the GATT 1994 and the Anti-Dumping Agreement permit only three types of 
responses to dumping (that is, provisional measures,  price undertakings, and definitive measures).  
Brazil agrees with Thailand and India that the Pane l's interpretation would authorize a fourth measure 
in the form of security requirements for potential fu ture anti-dumping liability.  In Brazil's view, it is 
unlikely that the drafters of the Anti-Dumping Agreement  had envisaged such a fourth permissible 
response to dumping, but negotiated detailed rules and publication requirements governing only three 
of these responses, while leaving the fourth co mpletely unregulated.  Brazil argues that the Ad Note 
does not authorize any action against potential futu re dumping, and that, once there has been an 
affirmative final determination of dumping in an inve stigation, there is no longer a "case of suspected 
dumping".  Brazil adds that periodic reviews mere ly establish the amount, and not the existence of 
dumping.  Moreover, the phrase "final determination of the facts" refers to an original investigation 
under Article 5 of the Anti-Dumping Agreement , as opposed to a periodic assessment review.  Brazil 
furthermore contends that the Ad Note has been implemented and interpreted in Article 7 of the Anti-
Dumping Agreement , and that there are strong similarities be tween the "language and the thrust" of 
Article 7 and the Ad Note.
158  
154. In Brazil's view, the Panel's approach to the Ad Note implies that each entry  of merchandise 
imported after the anti-dumping duty order is a "case"  of suspected dumping.  For Brazil, this ignores 
past decisions of the Appellate Body which clarify that dumping is determined for a "product as a whole".
159  For Brazil, the Panel's authorization of  bond requirements for retrospective duty 
assessment systems, and not for prospective duty assessment systems, impermissibly privileges 
retrospective duty assessment systems despite previ ous findings of the Appellate Body that the Anti-
Dumping Agreement  is "neutral" with respect to the two systems.160 
155. Brazil requests the Appellate Body to endorse Thailand's and India's arguments that cash 
deposits of estimated anti-dumping duties in the Un ited States' system are definitive duties that are 
subject to Article VI of the GATT 1994 as well as Article 9 of the Anti-Dumping Agreement .  Brazil 
also contends that the Panel's reasoning on "susp ected dumping" gives rise to asymmetry between the 
                                                      
158Brazil's third participant's submissions, US – Shrimp (Thailand) , para. 23 and US – Customs Bond 
Directive , para. 42. 
159Brazil's third participant's submissions, US – Shrimp (Thailand) , para. 25 and US – Customs Bond 
Directive , para. 44 (referring to, for inst ance, Appellate Body Report, US – Softwood Lumber V , paras. 92 
and 93;  and Appellate Body Report, US – Zeroing (Japan) , paras. 108 and 109). 
160Brazil's third participant's submissions, US – Shrimp (Thailand) , para. 27 and US – Customs Bond 
Directive , para. 46 (referring to Appellate Body Report, US – Stainless Steel (Mexico) , para. 121;  and Appellate 
Body Report, US – Zeroing (Japan) , para. 163).   WT/DS343/AB/R 
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determinations necessary for WTO- consistent imposition of anti-dump ing duties as it does not accord 
with the treatment of injury, which is not merely  "suspected" but is treated as "actually existing".161 
156. Brazil submits that, even assuming that the Ad Note applies to the EBR, the Panels correctly 
determined that the bond requirement does not cons titute "reasonable security" within the meaning of 
the Ad Note.  Brazil agrees that the Panel's "like lihood" standard for assessing reasonableness reflects 
the ordinary meaning of the term.  Further, Brazil considers that the United States' argument 
concerning a "high risk of default on any additional duties owed" is "misconceived"162, since this 
factor only becomes relevant once it has been demonstrated, as a threshold matter, that the duty rate 
will increase.   
157. Brazil argues that Article XX(d) of the GATT 1994 provides the requisite legal basis for the 
United States to address the risk of non-collection of duties.  However, the EBR targets the dumped 
goods and not the non-creditworthy importer.  As a resu lt, Brazil agrees with the Panel's analysis that 
the EBR is not "necessary" to secure compliance with WTO-consistent measures and that the EBR does not meet the requirements of the chapeau of Article XX(d).   
158. With respect to the Panel Report, US – Customs Bond Directive , Brazil makes two further 
comments.  First, Brazil urges the Appellate Body to  reverse the Panel's finding that Section 1623 of 
the Tariff Act and Section 113.13 of the United Stat es Regulations, which were  listed in the panel 
request, but not in the consultations request, were out side the Panel's terms of reference.  In Brazil's 
view, this finding disregards previous jurisp rudence on the function of consultations and the 
relationship between consu ltations requests and pane ls' terms of reference
163, negates the usefulness of 
consultations in assisting the complainant to refine  the dispute and discover information, and places 
an excessively high burden on complainants.  For Br azil, the important consideration in deciding 
whether to include, in a panel's terms of reference, measures referred to in a panel request, but not in 
the consultations request, is whether the newly added measures still part of the same dispute, are part 
of the natural evolution of the consultations pro cess, and do not have the effect of changing the 
essence of the complaint.   
                                                      
161Brazil's third participant's submissions, US – Shrimp (Thailand) , para. 33 and US – Customs Bond 
Directive , para. 52. 
162Brazil's third participant's submissions, US – Shrimp (Thailand) , para. 38 and US – Customs Bond 
Directive , para. 70 (quoting United States' other appellant's submissions, US – Shrimp (Thailand) , US – Customs 
Bond Directive , para. 13). 
163Brazil's third participant's submission, US – Customs Bond Directive , para. 14 (referring to Appellate 
Body Report, Brazil – Aircraft , para. 132;  Appellate Body Report, Mexico – Anti-Dumping Measures on Rice , 
para. 138;  Appellate Body Report, US – Upland Cotton , para. 293;  and Panel Report, Brazil Aircraft , 
para. 7.9).  WT/DS343/AB/R 
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159. Secondly, Brazil supports India's request that  the Appellate Body reverse the Panel's 
determination that the Amended CBD is not "as su ch" inconsistent with Articles 1 and 18.1 of the 
Anti-Dumping Agreement  and complete the analysis on this issu e.  For Brazil, only a certain type of 
discretion is relevant under the "mandatory/di scretionary" doctrine, namely, where the executive 
authority enjoys discretion not to apply a measure in a particular case but, nonetheless, when it chooses to apply the measure, the authority has no scope of interpreting the measure in a WTO-
consistent manner, and the resu lting action is necessarily WTO-inconsistent.  In Brazil's view, the 
Amended CBD constitutes such a measure because,  whenever it is applied, it results in WTO-
inconsistent action, constituting "specific action against dumping" that is not authorized by the 
Ad Note. 
2. Chile
 
160. Chile supports Thailand's positi on that additional security requirements, like the EBR, 
imposed after definitive anti-dumping measures have been applied, are not permissible under the 
Ad Note to Article VI of the GATT 1994 because, inter alia , the Ad Note refers to provisional 
measures, which are now regulated under Article 7 of the Anti-Dumping Agreement , and which apply 
in cases where dumping is "suspected".  Further, in  contrast to the Panel's findings, the review 
provided for in Article 9.3.1 of the Anti-Dumping Agreement  refers to the assessment of the final 
amount of anti-dumping duties payable, not to the exis tence of dumping, which is determined earlier.  
Chile submits that the Panel's approach to the inte rpretation of "suspected dumping" raises concerns 
about the types of disciplines that should apply in a determination of "susp ected dumping", and calls 
into question the core "principle of the Anti-Dumping Agreement " that the definitions of dumping and 
margin of dumping are the same throughout the Agreem ent.  Further, it may even lead Members to 
require security for any dumping that might occur in the future, even where a negative determination 
has been made.  Moreover, Chile submit s, the Panel's interpretation of the Ad Note would benefit only 
the United States, since it uses a retrospective dut y assessment system.  Finally, in Chile's view, 
acceptance of the Panel's interpretation would impl y a recognition of the absence of limitations on 
additional security requirements, such as the EBR, wh en there are limitations on other specific actions 
against dumping.  Chile also disagrees with the Pane l that cash deposits are not "duties" and considers 
that the amount of these "cash deposits" should not be higher than the margin of dumping established in a final determination or most recent assessment review.    WT/DS343/AB/R 
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161. Finally, Chile submits that, in assessing wh ether security is "reasonable" under the Ad Note, 
the Appellate Body should establish that security  is reasonable only where it "does not exceed the 
likely final liability for payment"164 of anti-dumping duties, and where it is based on the default risk of 
each importer. 
3. European Communities  
162. The European Communities focuse s its comments on the issue of whether the EBR was taken 
"in accordance with the provisions of GATT 1994, as interpreted by [the Anti-Dumping Agreement ]".  
The European Communities disagrees with the Pa nel's description of the relationship between 
Article VI of the GATT 1994 and the Anti-Dumping Agreement .  The European Communities further 
contends that the EBR is inconsistent with the Anti-Dumping Agreement  and the Ad Note, and that the 
EBR cannot be justified under Article XX of the GATT 1994. 
163. The European Communities submits that both Article VI of the GATT 1994 and the Anti-
Dumping Agreement  are part of the same treaty and should be interpreted in a harmonious and non-
conflicting manner.165  The General interpretative note to Annex 1A  to the Marrakesh Agreement 
Establishing the World Trade Organisation  (the " WTO Agreement ") and Articles 1 and 18.1 of the 
Anti-Dumping Agreement  make clear that the relationship between Article VI of the GATT 1994 and 
the Anti-Dumping Agreement  is of a hierarchical nature.  Given that hierarchy, a treaty interpreter has 
to consider first the provisions of the Anti-Dumping Agreement  to determine what (exact) rights and 
obligations the Anti-Dumping Agreement  sets forth with respect to a pa rticular issue.  The European 
Communities also notes that the Appellate Body applied the same kind of interpretation in the  US – 1916 Act  case.
166 
164. Following this order of analysis, the Europ ean Communities recalls the Appellate Body's 
statement in US – Offset Act (Byrd Agreement)  that "Article VI of the GATT 1994 and the Anti-
Dumping Agreement identify three responses to dumping, na mely, definitive anti-dumping duties, 
provisional measures, and price undertakings.  No other response is envisaged in the text of Article VI  
                                                      
164Chile's third participant's submission, US –  Shrimp (Thailand) , para. 23 (" no excede de la cantidad 
definitiva probable que deba satisfacerse ").  
165European Communities' third participant's submissions, US – Shrimp (Thailand) , US – Customs 
Bond Directive , para. 4 (referring to Appellate Body Report, Argentina –  Footwear (EC) , para. 81;  Appellate 
Body Report,  US – Upland Cotton , para. 549;  and Appellate Body Report, Korea – Dairy , para. 81). 
166Ibid., para. 6 (referring to Appellate Body Report, US – 1916 Act , paras. 114-116). WT/DS343/AB/R 
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of the GATT 1994, or the text of the Anti-Dumping Agreement ."
167  The European Communities notes 
that the Anti-Dumping Agreement  requires that all three forms of measures that a Member can adopt 
in response to dumping have to be preceded by at least a preliminary affirmative determination of 
dumping and injury.  However, the EBR, whenever applied, "mandates a collection of duties which 
significantly (up to 100%) exceeds the margin of  dumping established in the preceding anti-dumping 
investigation."168   Furthermore, the EBR is inconsistent with, inter alia , Article 9 of the Anti-
Dumping Agreement ;  and Article 9.3, in particular, does not allow the imposition and collection of 
anti-dumping duties related to a hypothetical  margin of dumping (that is, one that has not been 
established or confirmed yet in any inv estigation but is based on speculation).  
165. The European Communities disagre es with the Panel's view that a cash deposit under the 
United States' retrospective duty assessment system is not a "duty" subject to Article 9 of the Anti-
Dumping Agreement .  The European Communities argues that the chapeau of Article 9.3 refers to "the 
margin of dumping", and also, under the United St ates' retrospective duty assessment system, the 
duties shall not exceed the margin of dumping as estab lished under Article 2.  This is confirmed by a 
number of specific provisions of the Anti-Dumping Agreement , for instance, Article 6.9, 7.4, 9.1, 
9.3.1, and 10.3.  This interpretation is also in ac cordance with past panel and Appellate Body case law 
regarding the imposition and administration of variable duties under Article 9.4(ii) of the Anti-
Dumping Agreement .169   
166. Next, the European Communities contends that the Ad Note, interpreted in the light of the 
Anti-Dumping Agreement , does not authorize the EBR or any similar measure that requires deposits to 
be made in an amount exceeding the margin of dumping established under Article 2 of the Anti-
Dumping Agreement .  According to the European Commun ities, the Panel erred in creating the 
impression that the functioning of the United States' retrospective duty assessment system would be endangered if the EBR were not permissible.  However, the European Communities believes that 
variable duties that are consistent with the Anti-Dumping Agreement  can be used to solve the United 
States' collection problem.  Moreover, the Panel re lied excessively on the dictionary meaning of the 
term "suspected" and ignored other important textual elements of the Ad Note, in particular, the
                                                     
 
167European Communities' third participant's submissions, US – Shrimp (Thailand) , US – Customs 
Bond Directive , para. 8 (quoting Appellate Body Report, US – Offset Act (Byrd Amendment) , para. 269;  and 
referring to Panel Report, Mexico – Anti-Dumping Measures on Rice , paras. 7.273-7.280). 
168Ibid., para. 10. 
169Ibid., paras. 14, 15, and 18 (referring to Panel Report, Argentina – Poultry Anti-Dumping Duties , 
para. 7.359;  Appellate Body Report, US – Zeroing (Japan) , para. 162;  and Appellate Body Report, US – 
Stainless Steel (Mexico) , paras. 120 and 121).  WT/DS343/AB/R 
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phrase "pending final determination".  The term "final " makes clear that such determination had to be 
preceded by some sort of preliminary determination of facts and, therefore, the Ad Note  cannot be 
interpreted to authorize measures against a hypothetical dumping.  
167. In the European Communities' view, a security is a measure designed to ensure the payment 
of an anti-dumping duty, and therefore merely ancilla ry to the duty itself;  it cannot therefore be more 
onerous than the duty.  This principle is  also reflected in Article 7.2 of the Anti-Dumping Agreement , 
which governs provisional measures (including in the form of security).  Anti-dumping duties are, in 
contrast to other duties, conceived as a response ag ainst a particular behaviour  by the exporter.  The 
anti-dumping disciplines are well equipped to allow that behaviour to be recorded and, on the basis of 
that record, impose duties that are adequate and co mmensurate to deal with that specific behaviour.  
In the European Communities' view, measures su ch as the EBR circumvent these disciplines and, 
instead, endeavour to discipline the exporter direc tly on the basis of pure speculation.  Precisely 
because the EBR attempts to regulat e the activity of the exporter, which has no relationship to the 
dumping recorded and quantified for that exporter as required by the Anti-Dumping Agreement  and 
Article VI of the GATT 1994, it is inconsistent with those instruments. 
168. The European Communities, furthermore, submits that the EBR fails to satisfy the substantive 
conditions of Article XX(d) of the GATT 1994.  More  fundamentally, being a "specific action against 
dumping", the EBR simply cannot be legally cons idered under that provision.  It follows from 
Article 18.1 and footnote 24 thereto of the Anti-Dumping Agreement , as interpreted by the Appellate 
Body, that a measure that constitutes a "specific acti on against dumping" is subject to the disciplines 
of Article VI of the GATT 1994, as interpreted by the Anti-Dumping Agreement .  Hence, it cannot be 
justified under other provisions of the GATT 1994. 
4. India  
169. India supports Thailand's position in US – Shrimp (Thailand) that the Panel erred in finding 
that the permissible specific actions against dumping under Article 18.1 of the Anti-Dumping 
Agreement  are not limited to provisional measures, pri ce undertakings, and definitive duties, contrary 
to previous panel and Appellate B ody jurisprudence.  Specifically, India takes issue with the Panel's 
statement that the phrase "as interpreted by this Ag reement" in Article 18.1 is designed simply to 
clarify that the relevant provision of the GATT 1994 is Article VI, since that is the provision 
interpreted by the Anti-Dumping Agreement .  India notes, however, that  previous Appellate Body 
reports emphasize that Article VI, and in particular Article VI:2, must be read in conjunction with the 
entire Anti-Dumping Agreement  to determine what constitutes permissible specific action against WT/DS343/AB/R 
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dumping.  In India's view, the Panel's statement would lead to "serious anomalies"
170 since specific 
actions that are expressly contemplated by the Anti-Dumping Agreement would not be permissible 
unless expressly authorized by Article VI.  To the extent, therefore, that the Panel concluded that 
provisional measures do not implement the Ad Note, such provisional measures would be 
impermissible, because Article VI does not expressly authorize them.  India submits that the Panel found that a specific action contemplated by Article VI is permissible if it either is not expressly implemented by the text of, or is not prohibited by, the  Anti-Dumping Agreement  or the SCM 
Agreement .  In India's view, the Panel thereby rewrote the phrase "as interpreted by this Agreement" 
to read "if interpreted by this Agreement" and thus  proceeded contrary to the Appellate Body's view 
in Brazil – Desiccated Coconut  that Article VI and the  Anti-Dumping Agreement  or the SCM 
Agreement together constitute an inseparable  package of rights and disciplines.
171    
170. India contends that, based on this error of inte rpretation, the Panel then concluded that the 
Ad Note had not been implemented by the Anti-Dumping Agreement .  India also notes that Article 7 
of the Anti-Dumping Agreement  does permit the taking of security for payment of anti-dumping duties 
prior to the final determination, which is the basis of the decision to impose anti-dumping duties under Article 9.1.  In India's view, therefore, the Ad Note was not available as a "stand alone" provision, 
independent of the Anti-Dumping Agreement , to justify the taking of security after the imposition of 
an anti-dumping duty order.  To the extent that Article 7 clearly modifies rights under Article VI, 
including the Ad Note, therefore, even under the Panel's own analysis, the Panel should have 
concluded that Article VI is not available to justify the taking of security under the Ad Note.  
5. Japan
 
171. Japan agrees with Thailand and India that a bond  requirement imposed after the conclusion of 
an Article 5 investigation is not permissible specific action against dumping.  In Japan's view, the 
Panel did not pay sufficient attention to th e nature of the relationship between the Anti-Dumping 
Agreement  and Article VI of the GATT 1994, including the Ad Note.  Japan submits that the 
provisions of the GATT 1994 and Article 18.1 of the Anti-Dumping Agreement  must be read 
harmoniously to give full and effec tive meaning to all of their terms.172   
                                                      
170India's third participant's submission, US – Shrimp (Thailand) , para. 8. 
171Ibid., para. 9 (referring to Appellate Body Report, Brazil – Desiccated Coconut , pp. 13-14, DSR 
1997:I, 167, at 178-179). 
172Japan's third participant's submissions, US – Shrimp (Thailand) , US – Customs Bond Directive , 
paras. 12-14 (referring to Appellate Body Report, US – Upland Cotton , para. 549;  Appellate Body Report, 
Argentina – Footwear (EC) , para. 81 and footnote 72 thereto;  Appellate Body Report, US – Hot-Rolled Steel , 
paras. 51 and 52;  and Appellate Body Report, Guatemala – Cement I , para. 65).  WT/DS343/AB/R 
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172.  Japan asserts that, given the exceptional na ture of anti-dumping duties (being exceptions 
from Article II of the GATT 1994), Article VI of the GATT 1994 and the Anti-Dumping Agreement  
impose strict disciplines regarding th e purpose, nature, and extent of the remedial action that may be 
taken against dumping.  Japan notes that Article 11.1 of the Anti-Dumping Agreement , the opening 
clause of Article VI:2 of the GATT 1994, and Appellate Body case law clarify that anti-dumping measures allow Members to take remedial action against dumping in an amount that does not exceed 
the level of dumping that is causing injury.
173  Article 18.1 of the Anti-Dumping Agreement provides 
that only certain specified types of remedial act ion are authorized as a means of counteracting 
injurious dumping, namely, provisional measures,  price undertakings, and definitive anti-dumping 
duties.  Other types of trade restrictions, even if  they act against dumping and protect the domestic 
industry, are not permitted by the Anti-Dumping Agreement  (although they may be permitted by 
Article XX(d) of the GATT 1994).  Japan is of the view that Article 17.4 of the Anti-Dumping 
Agreement  does not allow a fourth permissible specific action against dumping under the Ad Note.  
Japan further submits that the structure and design of the Anti-Dumping Agreement  confirm this view.  
For Japan, although dumping is merely suspected during an investigation under Article 5 of the Anti-
Dumping Agreement , its existence is determined by an affirmative final determination at the 
conclusion of such an investigation.  Thereafter,  dumping is no longer suspected and, for the entire 
lifetime of the anti-dumping duty order, a Member is authorized to impose a definitive duty up to the prevailing margin of dumping.  
173. Japan disagrees with the Panel's finding that , following a final determination in an 
investigation, an importing Member can impose a bond  requirement at the time of importation, and 
impose a "duty" later.  For Japan, this interpretation contradicts Articles 9.1, 9.2, 9.3, 9.4, and 9.5, 
none of which authorizes the imposition of a bond to cover potential  liability for potential dumping 
that might never be found to exist and, therefore,  guarantees for such potential liability of potential 
dumping are not permissible forms of action against dumping at that stage.  Japan, therefore, 
disagrees with the Panel's finding that cash deposits, pa id after a final determination, are not "duties" 
but merely a guarantee against potential future liability.  
174. Moreover, Japan argues that the Panel misinter preted the terms "case", "pending", "dumping", 
and "final determination" in the Ad Note .  Further, as the Panel failed to  take into account the proper 
interpretive relationship between the Ad Note and Article 7, it impr operly concluded that the Ad Note 
supplements the three forms of remedial action envisaged in the Anti-Dumping Agreement . 
                                                     
 
173Japan's third participant's submissions, US – Shrimp (Thailand) , US – Customs Bond Directive , 
paras. 20-22 (referring to Appellate Body Report, US – Oil Country Tubular Goods Sunset Reviews , para. 115;  
and Appellate Body Report, US – Stainless Steel (Mexico) , para. 92). WT/DS343/AB/R 
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175. Japan strongly disagrees with the distinction cr eated by the Panel between prospective and 
retrospective duty assessment systems, since th e consequence is that Members operating a 
retrospective system are authorized to impose a bond requirement after the end of an Article 5 
investigation to cover the potential liability for pot ential dumping that might be found in a periodic 
review, whilst Members operating a prospective system cannot impose a bond as imports are known 
to be dumped in a pre-determined amount.  Japan  considers that the negotiating history of the Ad Note 
confirms that the phrase "case of suspected dumping" re fers to an Article 5 in vestigation, and not to 
the period after a final determination has been made. 
176. Japan concurs with the Panel that the EBR is not a "reasonable security" within the meaning 
of the Ad Note.  In Japan's view, the Panel properly inte rpreted the term "reasonable" to require a 
showing "that the rates of dumping provi ded for in the anti-dumping order were likely  to increase".
174  
177. Finally, Japan agrees that the EBR is not justified pursuant to Article XX(d) of the 
GATT 1994.  Japan asserts that, ab sent evidence of a likelihood of increase in the anti-dumping duty 
rates, the United States has failed to demonstrat e the "necessity" of a bond requirement that involves 
considerable additional costs for im porters of foreign goods.  Additiona lly, even if the EBR were to 
satisfy the elements of Article XX(d), Japan cons iders that certain findings by the United States 
Government Accountability Office (the "USGAO") a nd the USCIT regarding the application of the 
EBR raise serious questions about "arbitrary or unj ustifiable discrimination" within the meaning of 
the chapeau of Article XX. 
6. Korea  
178. Korea contends that the Panel ignored previous  decisions of the Appellate Body and created 
an additional specific action against dumpi ng, contrary to Article 18.1 of the Anti-Dumping 
Agreement .175  In Korea's view, the Ad Note does not authorize additional specific action against 
dumping after  definitive measures are imposed.  More importantly, the Anti-Dumping Agreement  
does not allow a Member to impose measures against alleged future  dumping, since an anti-dumping 
measure is permitted only to address currently exis ting dumping.  Finally, Korea submits that cash 
deposits (whether considered as "final payment" or an "estimated payment") are "duties" within the 
meaning of Article 9 of the Anti-Dumping Agreement , since an importer must pay this at the time of  
                                                      
174Japan's third participant's submissions, US – Shrimp (Thailand) , US – Customs Bond Directive , 
para. 108 (quoting Panel Report, US – Shrimp (Thailand) , para. 7.141;  Panel Report, US – Customs Bond 
Directive , para. 7.118). (emphasis added by Japan) 
175Korea's third participant's submission, US –  Shrimp (Thailand) , para. 9 (referring to  Appellate Body 
Report, US – 1916 Act , para. 137;  and Appellate Body Report, US – Offset Act (Byrd Amendment) , para. 265).  WT/DS343/AB/R 
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entry of merchandise.  For Korea, therefore, the limit of the amount of duties in Article VI:2 of the 
GATT 1994, and Article 9 of the Anti-Dumping Agreement  applies to cash deposits and should 
amount to the full margin of dumping or less, as stipulated under these provisions.  
7. Thailand  
179. Thailand raises two issues regarding India's appeal of the Panel Report in US – Customs Bond 
Directive .  First, Thailand agrees with India that it was not necessary or appropriate for the Panel to 
find that the Ad Note permits additional specific action agai nst dumping in order to ensure that the 
Anti-Dumping Agreement  does not impermissibly supersede Article VI of the GATT 1994 and 
thereby render the Ad Note superfluous.  In Thailand's view, contrary to the Panel's finding, the 
Appellate Body Report in Brazil – Desiccated Coconut does not support the Panel's approach.  
Conversely, statements of th e Appellate Body in both Brazil – Desiccated Coconut and US – 1916  Act 
suggest that Article VI of the GATT 1994 must be re ad in conjunction with the provisions of both the 
SCM Agreement  and the Anti-Dumping Agreement .176  Further, in Thailand's view, as Article 1 of the 
Anti-Dumping Agreement  confirms, the Anti-Dumping Agreement  was negotiated to "implement" and 
"govern the application of Article VI", and the fact  that numerous elements of  Article VI are governed 
by the Anti-Dumping Agreement  does not render these elements of Article VI superfluous.  Thailand 
argues that, contrary to the Panel's reasoning, the fact that, for instance, Article VI:5 and 
Article VI:6(b) of the GATT 1994 are not elaborated in the Anti-Dumping Agreement  does not mean 
that these provisions permit additional specific action against dumping.  In any event, Thailand 
considers that the matters covered in the Ad Note are expressly addressed in Article 7 of the Anti-
Dumping Agreement .  For this reason, Thailand submits that  the Appellate Body should reverse the 
Panel's interpretation and find that the Ad Note is temporally limited in scope and governed by 
Article 7;  however, in the event that the Appe llate Body does not do so, Thailand asks the Appellate 
Body to reject the Panel's statemen t that the provisions of Article VI must be interpreted to permit 
specific actions against dumping separate from those authorized under the Anti-Dumping Agreement , 
in order to avoid these provisi ons being rendered superfluous.   
180. Thailand shares India's concern that the Panel's finding that Article XX(d) of the GATT 1994 
may be used as a defence to measures found to be inconsistent with the Ad Note, would "improperly 
undermine the disciplines of Article 18.1 of the Anti-Dumping Agreement ."177  Thailand considers 
that, as the Appellate Body has clarified, Article VI of the GATT 1994 is the only provision of the 
                                                      
176Thailand's third participant's submission, US – Customs Bond Directive , paras. 5-8 (referring to 
Appellate Body Report, Brazil – Desiccated Coconut , p. 18, DSR 1997:I, 167, at 182;  and Appellate Body 
Report, US – 1916  Act, para. 118). 
177Ibid., para. 14.  WT/DS343/AB/R 
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GATT 1994 "interpreted" by Article 18.1 of the Anti-Dumping Agreement , once a measure is found to 
be "specific action against dumping".  If that is th e case, its legality is to be determined only by 
reference to the provisions of Article VI as interpreted by the Anti-Dumping Agreement , and there is 
no basis to consider further whether it may be ju stified under other provisions of the GATT 1994 not 
referred to in Article 18.1.  Furt her, Thailand submits that the Pane l's interpretation that "specific 
action against dumping" may be justified specifically  under Article XX would allow for a situation in 
which a measure could be inconsistent with both Article VI and Article 18.1, yet a defence would 
only be available under Article XX with respect to the Article VI finding of inconsistency.  In 
Thailand's view, there is "no rational basis"
178 for such distinction, which would introduce 
fragmentation in the regime of Article VI of the GATT 1994 and the Anti-Dumping Agreement . 
III. Issues Raised in These Appeals 
181. The following issues are rai sed in these appeals:  
(a) in the appeals by Thailand and India179: 
(i) whether the Panel erred in finding that the temporal scope of the Ad Note to 
Article VI:2 and 3 of the GATT 1994 (the " Ad Note") is not limited to the 
original investigation period and extends as well to the period after the imposition of an anti-dumping duty order;  and 
(ii) whether the Panel erred in conc luding that cash deposits required under 
United States law are not anti-dumping duties falling within the scope of 
Article 9 of the Anti-Dumping Agreement ; 
(b) in the other appeals by the United Stat es, and the appeals by Thailand and India: 
(i) whether the Panel erred in its an alysis of the "reasonableness" of the 
enhanced continuous bond requirement (the "EBR") by the United States on 
imports of frozen warmwater shrimp th at were subject to anti-dumping duties 
("subject shrimp"); 
(c) in the appeal by India: 
                                                     
 
178Thailand's third participant's submission, US – Customs Bond Directive , para. 18. 
179In this Report, we refer to Thailand first and then to India, in keeping with the chronology of the 
Panel Reports.  WT/DS343/AB/R 
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(i) whether the Panel erred in fi nding that the "Amended Customs Bond 
Directive" (the "Amended CBD")180 is not inconsistent "as such" with 
Articles 1 and 18.1 of the Anti-Dumping Agreement and Articles 10 and 32.1 
of the SCM Agreement ; 
(ii) whether the Panel erred in finding th at the Amended CBD is not inconsistent 
"as such" and "as applied" with Articles 9.1, 9.2, 9.3, and 9.3.1 of the Anti-
Dumping Agreement , and in finding that the Amended CBD is not 
inconsistent "as such" with Articles 19.2, 19.3, and 19.4 of the SCM 
Agreement ; 
(iii) whether the Panel erred in finding that Section 1623 of the United States 
Tariff Act of 1930181 (the "Tariff Act") and Section 113.13 of the United 
States Code of Federal Regulations  (the "United States Regulations") were 
not within the Panel's term s of reference;  and  
(iv) whether, in its consideration of the defence raised by the United States under 
Article XX(d) of the GATT 1994, the Panel: 
- erred in concluding that a defen ce under Article XX(d) of the GATT 1994 
was available to the United States;  and  
- made a prima facie  case for the United States and, thereby, acted 
inconsistently with its obligation unde r Article 11 of the DSU to make an 
objective assessment of the matter before it;  and 
(d) in the other appeals by the United States: 
(i) whether, in its analysis of the defence raised by the United States under 
Article XX(d) of the GATT 1994, the Panel erred in finding that the EBR, as applied to subject shrimp, was not "necessary" to secure compliance with certain laws or regulations of the United States. 
                                                     
 
180The EBR has been imposed pursuant to Customs Directive No. 099-3510-004 on Monetary 
Guidelines for Setting Bond Amounts issued on 23 July 1991 (the "1991 Directive"), as amended by the documents and instruments constituting the "Amended CBD". (See supra , footnote 11 and infra , paras. 190 and 
191) 
181Supra , footnote 53. WT/DS343/AB/R 
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IV. The Measure at Issue 
A. Introduction 
182. The relevant measure in both US – Shrimp (Thailand)  and US –  Customs Bond Directive  is 
the EBR.  The EBR is imposed by United States Customs and Border Protection ("United States 
Customs") pursuant to the Amended CBD, which co mprises four instruments that amend a United 
States directive that sets out the guidelines to be followed by United Stat es Customs in determining 
the amount of customs bonds required for impor tation of merchandise into the United States.
182   
183. Both Thailand and India have made "as applie d" claims regarding the EBR.  The EBR was 
imposed by United States Customs, with effect from 1 February 2005, on all imports of subject 
shrimp.  These anti-dumping duties had been imposed  by an anti-dumping duty order published by the 
United States Department of Commerce (the "USDOC ") on the same date, that is, 1 February 2005.183  
India has also made a number of separate "as such" claims against the Amended CBD, pursuant to 
which the EBR is imposed.   
                                                      
182See infra , paras. 190 and 191. 
183The anti-dumping duty order was issued on 1 February 2005 by the USDOC following a 
determination that subject shrimp from Brazil, China, Ecuador, India, Thailand, and Viet Nam were being 
dumped in the United States, and a finding by the United States International Trade Commission (the "USITC") 
that the United States' domestic industry was materially injured by imports of subject shrimp. (See Notice of 
Amended Final Determination of Sales at Less than Fair Value and Antidumping Duty Order: Certain Frozen 
Warmwater Shrimp from Thailand, United States Federal Register , Vol. 70, No. 20 (1 February 2005) 5145 
(Exhibit THA-14 submitted by Thailand to the Panel);  a nd Notice of Amended Final Determination of Sales at 
Less Than Fair Value and Antidumping Duty Order: Certain Frozen Warmwater Shrimp from India, United 
States Federal Register , Vol. 70, No. 20 (1 February 2005) 5147 (Exhibit IND-13 submitted by India to the 
Panel))  In the amended final determinations, the USDOC established margins of dumping ranging from 5.29 to 
6.82 per cent for Thai exporters and an "all others" rate of 5.95 per cent;  and margins of dumping ranging from 
4.94 to 15.36 per cent for Indian exporters and an "all others" rate of 10.17 per cent.  WT/DS343/AB/R 
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B. Background 
1. The Retrospective Anti-Dumping Duty  Assessment System of the United 
States184 
184. The first stage of the United States' anti-dumping duty system is the original investigation for 
the imposition of anti-dumping duties.  The USDOC c onducts an investigation to determine whether 
dumping by an exporter occurred during the period of investigation.  The USDOC communicates its determination of the existence and level of dumping to the United States International Trade 
Commission ("USITC"), which conducts its own inv estigation to determine whether the relevant 
United States industry is materially injured or threat ened with material injury by reason of the dumped 
imports.  If the USDOC makes an affirmative dete rmination that dumping occurred during the period 
of investigation, and the USITC makes an affirm ative determination that the domestic industry was 
materially injured or threatened with material in jury by reason of dumped imports, the USDOC issues 
a Notice of Antidumping Duty Order and imposes an  "estimated anti-dumping duty deposit rate" (also 
referred to as a "cash deposit rate") equivalent to  the "overall weighted average dumping margin" for 
each exporter individually examined.  In addition, the Notice of Antidumping Duty Order sets out an "all-others" rate applicable to exporters  that were not individually examined. 
185. The second stage of the United States' system is the assessment of the final liability for 
payment of anti-dumping duties.  The United States  uses a retrospective duty assessment system for 
the assessment of anti-dumping duty  liability under which the final liability for payment of anti-
dumping duties is determined in an assessment review for a discrete period of time after the merchandise is imported.  Under this system, the Un ited States initially collects "cash deposits" at the 
time of each entry of the subject merchandise at the "estimated anti-dumping duty deposit rate" (also 
called "cash deposit rate") of the re levant exporter.  Subsequently, once a year, during the anniversary 
month of the anti-dumping duty order, interested parties may request the USDOC to conduct an assessment review (also called a "periodic review")  to determine the final liability for payment of 
anti-dumping duties owed on entries that occurred during the previous year.  If a request for an 
assessment review is made by any party, the USDOC  will review  all  sales made by the relevant 
exporter in order to calculate a going-forward cash depos it rate that will apply to all future entries of  
                                                     
 
184See also the Panel's description of  the United States' retrospective duty assessment system at Panel 
Report, US – Shrimp (Thailand) , paras. 2.7-2.10 and Panel Report, US –  Customs Bond Directive , 
paras. 2.4-2.7.  For a more detailed description of th e United States' retrospective anti-dumping duty assessment 
system, see also Appellate Body Report, US – Stainless Steel (Mexico) , paras. 72-75. WT/DS343/AB/R 
WT/DS345/AB/R Page 70 
 
 
the subject merchandise from that exporter.  Simultaneously, the USDOC will calculate a duty 
assessment rate for each importer that imports from that exporter and determine the final liability for 
payment of anti-dumping duties by that importer on the basis of its duty assessment rate.  If no 
assessment review is requested, the cash deposits made on entries during the previous year are automatically assessed as the final duties. 
2. Overview of Customs Bond Requirements in the United States 
 
186. All importers of merchandise into the United States must post a basic customs bond for 
importation.185  An importer subject to an anti-dumping duty order must also post a basic customs 
bond to United States Customs in addition to  paying the cash deposits mentioned above. 
187. Customs bonds are legal instruments to secure po ssible liabilities that may arise out of failure 
to perform various obligations imposed on im porters under United States laws and regulations, 
including the obligation to pay any duties, taxes, and charges imposed on the imported 
merchandise.186  There are three parties to a customs bond—the bond principal, the surety, and the 
beneficiary.  The bond principal is usually an importe r;  the surety is a guarantor that agrees to pay 
any liabilities that might arise from the bond principal's failure to perform the specified obligations under United States law
187;  and the beneficiary of the bond is United States Customs.   
188. United States Customs derives its authority to require such bonds from Section 1623 of the 
Tariff Act, which empowers the Secretary of the Tre asury to require or authorize customs officers to 
require bonds for the protection of the revenue and for ensuring compliance with any laws or 
regulations that the Secretary is authorized to en force.  The Secretary h as also the authority to 
prescribe the conditions of the bonds and to fix the amounts thereunder.188  Section 113.13 of the 
United States Regulations authorizes United States Customs to determine the sufficiency of bond 
                                                      
185See Section 142.4(a) of the Unite d States Regulations provides th at "merchandise shall not be 
released from Customs custody … unless a single entry or continuous bond on Customs Form 301 … has been filed".  
186See United States Regulations, Section 113.62. 
187Surety companies are certified by the Financial Ma nagement Service of the United States Treasury. 
(See Questions and Answers on Customs Bonds, United States Customs Publication No. 0000-0590, revised 
November 2006, p. 3).  The surety usually charges a fee from the bond principal and may take a collateral. 
188Tariff Act, supra , footnote 53, Section 1623.  This authority is reflected, inter alia , in the United 
States Regulations at Section 113.1:  "Where a bond or other security is not specifically required by law, the 
Commissioner of Customs, pursuant to Treasury Department Order No. 165 Revised, as amended (TD 53654, 19 FR 7241, November 6, 1954) may by regulation or specific instruction require, or authorize the port director 
to require, such bonds or other security considered necessary for the protection of the revenue or to assure 
compliance with any pertinent la w, regulation or instruction."  WT/DS343/AB/R 
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amounts to secure the importers' liability.189  United States Customs is also required to review bonds 
periodically in order to determine whether such bonds  are adequate to protect the revenue and ensure 
compliance with the laws and regulations and, may require additional security where this is necessary 
to protect the revenue or to ensure enforcemen t of United States Customs laws or regulations.190   
189. In accordance with Section 113.13 of the Un ited States Regulations, United States Customs 
established guidelines under Customs Directive No. 099-3510-004 of 23 July 1991191 (the "1991 
Directive") for determining the amount of an importe r's bond.  As far as importation is concerned, the 
prescribed bond amount differs depending on whether a single transaction bond192 or a continuous 
bond is sought by the importer.  For purposes of  these appeals, only the continuous bond—which 
secures payments arising out of all the import transactions by a particular importer over the period of time for which the bond remains effective—is re levant.  Under the 1991 Directive, the basic 
continuous bond formula for an existing importer (the  "basic bond requirement") applicable to all its 
imports is the greater of US$50,000 or 10 per cent of the duties, taxes, and fees paid by that importer 
during the prior calendar year.
193   
3. The Enhanced Continuous Bond Requirement  
190. In 2003, United States Customs undertook a review of its overall duty collection system to 
identify areas in which it was experiencing serious difficulties in the collection of customs duties.  
This review revealed that defaults on an ti-dumping duty supplemental bills had increased 
                                                      
189Specifically, Section 113.13 of th e United States Regulations provid es that United States Customs 
should consider the following:  (1) the prior record of the principal in timely payment of duties, taxes, and charges with respect to the transaction(s) involving such payments; (2) the prior record of the principal in 
complying with Customs demands for redelivery, the obligation to hold unexamined merchandise intact, and 
other requirements relating to enforcement and administration of Customs and other laws and regulations;  (3) the value and nature of the merchandise involved in the transaction to be secured; (4) the degree and type of 
supervision that Customs will exercise over the transaction; (5) the prior record of the principal in honouring 
bond commitments, including the payment of liquidated damages;  and (6) any additional information contained in any application for a bond. 
190United States Regulations, Section 113.13(c) and (d). 
191Supra , footnote 10. 
192A single transaction bond secures payments ar ising out of a single import transaction.   
193See 1991 Directive, supra , footnote 10, p. 3, which fixes a minimum continuous bond amount of 
US$50,000 and establishes the following formula:  (1) in the case of US$0 to US$1 million duties/taxes, the 
bond limit of liability is fixed in multiples of US$10,000 n earest to 10 per cent of duties, taxes, and fees paid 
during the preceding calendar year;  or (2) in the case of duties/taxes over US$1 million, the bond liability is 
fixed in multiples of US$100,000 nearest to 10 per cent of duties, taxes, an d fees paid during the preceding year. 
(Panel Report, US – Shrimp (Thailand) , para. 2.15 and footnote 25 thereto;  Panel Report, US –  Customs Bond 
Directive , para. 2.12 and footnote 20 thereto)  See also Panel Report, US – Shrimp (Thailand) , paras. 2.13-2.15;  
Panel Report, US –  Customs Bond Directive , paras. 2.10-2.12.  Note however, that the 1991 Directive also 
provides that the basic bond may be higher than that computed using the formula, "provided sufficient evidence 
is on-hand to support the higher amount." WT/DS343/AB/R 
WT/DS345/AB/R Page 72 
 
 
substantially from the previous years.
194  This led United States Customs to reconsider its basic 
continuous  bond formula and to identify certain situations in which the basic bond requirement was 
found to be no longer sufficient.  The following four instruments amended the 1991 Directive: 
(i) United States Customs document entitled "Amendment to Bond Directive 99-3510-
004 for Certain Merchandise Subject to Antidumping/Countervailing Cases" dated 
9 July 2004 (the "July 2004 Amendment")195; 
(ii) United States Customs document entitled "Cu rrent Bond Formulas" dated 25 January 
2005 (the "Current Bond Formulas")196;   
(iii) United States Customs document entitled "Clarification to July 9, 2004 Amended 
Monetary Guidelines for Setting Bond Amounts for Special Categories of Merchandise Subject to Antidumping and/or Countervailing Duty Cases" dated 
10 August 2005 (the "August 2005 Clarification")
197;  and 
(iv) United States Customs Federal Regi ster Notice USCBP-2006-0119 entitled 
"Monetary Guidelines for Setting Bond Amounts for Importations Subject to Enhanced Bonding Requirements" da ted 24 October 2006 (the "October 2006 
Notice").
198 
191. These four instruments, which collectivel y constitute the Amended CBD, permit United 
States Customs to impose enhanced bond amounts on importers seeking to import certain merchandise subject to anti-dumping or counterva iling duties.  Merchandise subject to anti-dumping 
or countervailing duties designated by United States  Customs as a "covered case" within a "special 
category" is subject to the EBR.  To date, only subject shrimp has been designated as a "covered case" 
within the "special category" of agriculture and aquaculture.  The October 2006 Notice "represents the 
comprehensive and exclusive statement of policy a nd processes expressed in" the other instruments of 
the Amended CBD.
199   
                                                      
194According to the United States, while historically, annual uncollected anti-dumping duties from 
importers had been relatively low (ra rely exceeding US$10 million a year), outstanding anti-dumping liability 
for 2004 alone reached an u nprecedented US$225 million for agriculture  and aquaculture cases, that is, for 
merchandise similar to shrimp.  (See United States' first written submission to the Panel in US – Shrimp 
(Thailand) , paras. 12 and 52;  and United States' first written submission to the Panel in US – Customs Bond 
Directive , paras. 13 and 68).   
195Exhibits THA-2 and IND-3 submitted by Thailand an d India, respectively, to the Panel.     
196Exhibits THA-3 and IND-4 submitted by Thailand  and India, respectively, to the Panel. 
197Exhibits THA-4 and IND-5 submitted by Thailand  and India, respectively, to the Panel. 
198Exhibits THA-5 and IND-6 submitted by Thailand  and India, respectively, to the Panel. 
199October 2006 Notice, supra , footnote 11, at 62277.  WT/DS343/AB/R 
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192. The EBR includes a standard formula to determ ine the amount of the enhanced continuous 
bond that all existing importers200 of subject shrimp must provide, unless United States Customs 
determines that there are "exceptional circumstances" or that the importer has "a record of compliance 
… and … has demonstrated an ability to pay."201  According to the standard formula, the EBR 
requires, in addition to the basic bond requirement, an amount equivalent to 100 per cent of the anti-
dumping duty rate of the exporter concerned, multiplied by the value of imports of subject shrimp of 
that importer in the previous 12 months.202   
193. Therefore, the total obligations imposed on importers of subject shrimp by United States 
Customs, following the imposition of the EBR, comprise: 
(a) the cash deposits for estimated anti-dumping duties;  (b) the basic bond requirement in an amount that is the greater of US$50,000 or 
10 per cent of the duties, taxes, and fees paid during the preceding year, rounded to 
the figure set out in the basic bond formula;  and 
(c) the EBR in an amount equivalent to 100 per cent of the anti-dumping duty rate 
multiplied by the value of imports of subject shrimp in the previous 12 months.
203 
194. The Amended CBD authorizes United States Customs to use the standard formula or, instead, 
make individualized bond determina tions for subject shrimp importers  to determine the EBR amounts.  
Specifically, the August 2005 Clarification and the October 2006 Notice provide that United States 
Customs may reconsider bond amounts for individual importers on a case-by-case basis to ensure that 
duties owed by them are collected.  In order to receive an individualized bond determination, an 
importer must make a request and may submit information on its financ ial condition related to the risk 
of non-collection of duties for that importer.  United States Customs will then determine bond 
amounts applicable to that importer based on the financial information supplied by the importer, 
United States Customs' records on compliance histor y of the importer, the importer's or principal's 
                                                      
200The requirements for new importers are analogous. (See ibid, at 62277:  "For new importers with no 
prior history of imports who import Special Category merc handise subject to AD/CVD the continuous bond will 
be calculated in accordance with  the following formula: the [USDOC] deposit rate in e ffect on date of entry X 
the importer's estimated annual value of imported goods subject to the case").   
201See ibid., at 62277-62278.  
202The October 2006 Notice provides: "The amount of additional covera ge will be calculated using the 
following formula: AD/CVD rate established in [USDOC] Order (or the rate established in the most recently 
completed administrative review) x previous 12 months' cumulative import value of subject merchandise". 
(Ibid., at 62277) 
203See Panel Report, US – Shrimp (Thailand) , para. 2.15 and Panel Report, US –  Customs Bond 
Directive , para. 2.12, for hypothetical illustrations of the total obligations due from importers of shrimp subject 
to the anti-dumping duty order, as a result of the EBR. WT/DS343/AB/R 
WT/DS345/AB/R Page 74 
 
 
ability to pay, and other "relevant inform ation" available to United States Customs.
204  The enhanced 
continuous bonds provided pursuan t to the Amended CBD are released when the final liability for 
payment of anti-dumping duties is assessed, and the relevant import entries are liquidated.205   
195. The parties disagreed before the Panel on the impact of the EBR on importers of Thai and 
Indian shrimp.206  However, the Panel noted that importers  have faced significantly higher security 
obligations than previously to enter merchandise.207  The Panel also referred to a report by the United 
States Government Accountability Office (the "USGAO") on United States Customs' Revised 
Bonding Policy208 (the "USGAO Report"), which concluded that, because of the additional security, 
collateral, and fee obligations associated with th e EBR, importers/exporters probably had to forgo 
other commercial opportunities, although the effects could not be fully isolated from other changes 
occurring at the same time.209  The USGAO Report also observed that some importers have required 
exporters to export on a Delivery Duty Paid ("DDP ") basis, thereby making the exporter, as the 
importer of record, responsible for customs bond requirements.210  Additionally, in October 2006, the 
USGAO concluded that the Amended CBD criteria were  not transparent, nor were they consistently 
                                                      
204See October 2006 Notice, supra , footnote 11, at 62277.  The Panel noted that to date, the United 
States has indicated that, as regards imports of subject shrimp, it has received 27 requests for individualized 
bond determinations, of which it has reviewed 22 requests and has granted no reductions to three importers, 
reductions of 25 per cent to 11 importers, 45 per cent to one importer, 75 per cent to two importers, 80 per cent to one importer and 85 per cent to two importers. (See United States' response to Question 28 posed by the 
Panel in US – Shrimp (Thailand) , para. 31;  United States' response to Question 22 posed by the Panel in US – 
Customs Bond Directive , para. 28;  and Exhibit US-12 submitted by  the United States to the Panel, which 
provides a list of importers requesting individual bond amounts)  A report by the United States Government 
Accountability Office (the "USGAO") indicates that the number of shrimp importers totalled 550 through June 
2006. (USGAO Report, Customs' Revised Bonding Policy Reduces Risk of Uncollected Duties, but Concerns 
about uneven Implementation and Effects Remain , GAO-07-50 (Washington DC, October 2006) (Exhibits 
THA-10 and IND-26 submitted by Thailand and India, respectively, to the Panel), p. 42)  Exhibit US-17 
submitted by the United States to the Panel refers to 530 shrimp importers in 2004. (See Panel Report, US – 
Shrimp (Thailand) , para. 2.16 and footnote 27 thereto;  and Panel Report, US – Customs Bond Directive , 
para. 2.13 and footnote 22 thereto)  
205Under Section 1675(b) of the Tariff Act ( supra , footnote 53), once the administering authority orders 
liquidation of entries pursuant to a review, goods are liqui dated within 90 days after the instructions to United 
States Customs are issued, in  most cases. (Panel Report, US – Shrimp (Thailand) , para. 2.17 and footnote 28 
thereto;  Panel Report, US – Customs Bond Directive , para. 2.14 and footnote 23 thereto) 
206Panel Report, US – Shrimp (Thailand) , paras. 2.18;  Panel Report, US –  Customs Bond Directive , 
paras. 2.15.  
207Ibid.  
208Ibid., (referring to USGAO Report, supra , footnote 204). 
209See ibid., (referring to USGAO Report, supra , footnote 204, pp. 6, 24, and 35;  and  National 
Fisheries v. US Customs , supra , footnote 90, p. 31). 
210See Panel Report, US – Shrimp (Thailand) , para. 2.18 and Panel Report, US – Customs Bond 
Directive , para. 2.15 (referring to USGAO Report, supra , footnote 204, p. 6).  See also United States' second 
written submission to the Panel in US – Shrimp (Thailand) , para. 30, wherein the United States contends that the 
use of a DDP basis rather than a Cost , Insurance and Freight (CIF) basis does not affect the costs borne by the 
importer of record.  WT/DS343/AB/R 
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applied.211  The Panel also noted that, following a comp laint by certain shrimp importers, the United 
States Court of International Trade (the "USCIT") issued a preliminary status quo  injunction in favour 
of eight of 20 complaining parties on the ground s that the administrative record supported the 
conclusion that the plaintiffs are likely to dem onstrate that United States Customs arbitrarily and 
capriciously selected the anti-dumping duty orde rs on shrimp as the only "covered case" of 
merchandise and that the application of the EBR to eight complaining parties was "arbitrary and 
capricious".212  The USCIT's decision on the merits of the case is still pending. 
V. The Interpretation of the Ad Note to Article VI:2 and 3 of the GATT 1994 
A. Introduction 
196. We first note the context in which the question of the interpretation of the Ad Note arose 
before the Panel.  The Pa nel came to examine the Ad Note in the broader context of the "as applied"  
claims brought by Thailand and India against the EBR under Article 18.1 of the Anti-Dumping 
Agreement .  This Article provides that:  
[n]o specific action against dumping of exports from another 
Member can be taken except in accordance with the provisions of GATT 1994, as interpreted by this Agreement. (footnote omitted) 
197. Before the Panel, Thailand and India contended that the application of the EBR to subject 
shrimp constitutes an impermissible "specific actio n against dumping" and that, therefore, it is 
inconsistent with Article 18.1.
213  In response, the United States argu ed that the EBR is not a specific 
action against dumping and that, in any event,  the EBR was applied "in accordance with the 
provisions of the GATT 1994" as interpreted by the Anti-Dumping Agreement , because the 
application of the EBR is authorized by the Ad Note.214 
198. The Panel began its analysis of these claims by  examining whether or not the application of 
the EBR to subject shrimp constitutes "specific action against dumping" within the meaning of 
Article 18.1 of the Anti-Dumping Agreement .  Relying on the Appellate Body Reports in US – 1916 
                                                      
211See Panel Report, US – Shrimp (Thailand) , para. 2.19 and Panel Report, US – Customs Bond 
Directive , para. 2.16 (generally referring to USGAO Report,  supra , footnote 204). 
212Ibid. 
213Thailand's first written submission to the Panel in US – Shrimp (Thailand) , executive summary, 
Panel Report, US – Shrimp (Thailand) , pp. A-10 to A-12, paras. 5-18;  India's first written submission to the 
Panel in US – Customs Bond Directive , executive summary, Panel Report, US – Customs Bond Directive , 
pp. A-10 to A-12, paras. 4-13. 
214See United States' first written submission to the Panel in US – Shrimp (Thailand) , executive 
summary, Panel Report, US – Shrimp (Thailand) , pp. A-5 and A-6, paras. 18-21 and 24;  United States' first 
written submission to the Panel in US – Customs Bond Directive , executive summary, Panel Report, US – 
Customs Bond Directive , pp. A-5 and A-6, paras. 19-22 and 25. WT/DS343/AB/R 
WT/DS345/AB/R Page 76 
 
 
Act and US – Offset Act (Byrd Amendment) , the Panel indicated that three conditions must be met in 
order to conclude that a measure is inconsistent with Article 18.1 of the Anti-Dumping Agreement .  
First, the measure must be specific to dumping.  Secondly, it must be shown that the measure acts 
"against" dumping.  Thirdly, the measure has not b een taken in accordance with the provisions of the 
GATT 1994 as interpreted by the Anti-Dumping Agreement .   
199. The Panel first found that the application of the EBR is "specific" to dumping because it is 
inextricably linked to, or has a strong correlation w ith, the constituent elements of dumping.  For the 
Panel, the constituent elements of dumping ar e implicit in the express  conditions and legal 
prerequisites for the application of the EBR.  Th e Panel considered that the close link between the 
application of the EBR and the constituent elements  of dumping appears from the direct reference to 
the anti-dumping duty rate in the formula for calculating the EBR.
215   
200. The Panel then examined whether the application of the EBR acts "against" dumping.  
Recalling previous Appellate Body jurisprudence, the Panel considered that a measure acts against 
dumping if it deters or dissuades foreign producer s or exporters from engaging in the practice of 
dumping.  For the Panel, the application of the E BR acts in this manner because it entails additional 
costs that, although initially borne by the importers , ultimately impact on foreign producers/exporters 
of the subject merchandise.216  The Panel identified the additional costs as being the fees and collateral 
requirements required by surety companies for providing the enhanced bonds.217  The Panel reasoned 
that, since a bond applied as a provisional measure is treated as "specific action against dumping", a 
bond applied as a definitive measure should be simila rly categorized, because the adverse bearing of 
the bond on foreign producers/exporte rs and importers is the same.218  The Panel therefore concluded 
that the application of the EBR constitutes "specific action against dumping" within the meaning of Article 18.1 of the Anti-Dumping Agreement .
219   
201. We observe that the findings of the Panel that th e application of the EBR to subject shrimp is 
"specific" to dumping and that it acts "against" dumping have not been appealed.  Therefore, we do 
not express a view as to the correctness of this fi nding and treat it as a given in this appeal.   
                                                      
215Panel Report, US – Shrimp (Thailand) , paras. 7.71 and 7.72;  Panel Report, US – Customs Bond 
Directive , paras. 7.45 and 7.46. 
216Panel Report, US – Shrimp (Thailand) , para. 7.75;  Panel Report, US – Customs Bond Directive , 
para. 7.49. 
217Panel Report, US – Shrimp (Thailand) , footnote 119 to para. 7.75;  Panel Report, US – Customs 
Bond Directive , footnote 87 to para. 7.49. 
218Panel Report, US – Shrimp (Thailand) , para. 7.77;  Panel Report, US – Customs Bond Directive , 
para. 7.51. 
219Panel Report, US – Shrimp (Thailand) , para. 7.78;  Panel Report, US – Customs Bond Directive , 
para. 7.52.  WT/DS343/AB/R 
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202. Having found that the application of the EBR to subject shrimp constitutes "specific action 
against dumping", the Panel turned to an examina tion of whether the EBR was applied "in accordance 
with the provisions of GATT 1994, as interpreted by the Anti-Dumping Agreement ".  In doing so, the 
Panel first examined the relationship between the Ad Note and the Anti-Dumping Agreement , and 
disagreed with the arguments of Thailand and India that recourse to the Ad Note is not available once 
an action is found to be a specific action against dumping, because the Ad Note cannot be applied 
independently of the Anti-Dumping Agreement and the Ad Note cannot provide an independent basis 
to create a fourth permissible response to dumping.220  It is in this context that the Panel interpreted 
the Ad Note and applied it in assessing whether the app lication of the EBR to subject shrimp is "in 
accordance with" this provision of the GATT 1994.   Although the Panel considered that the 
application of the EBR falls within the temporal scope of the Ad Note, it concluded that the 
application of the EBR to subject shrimp is inconsistent with the Ad Note because it is not 
"reasonable" within the meaning of the Ad Note.221  Therefore, the Panel concluded that the 
application of the EBR to subject shrimp is inconsistent with Article 18.1 of the Anti-Dumping 
Agreement .222   
B. The Temporal Scope of the Ad Note   
203. The main issue on appeal concerns whether the a pplication of the EBR to subject shrimp is in 
accordance with the GATT 1994 as interpreted by the Anti-Dumping Agreement .  Since it is not 
disputed that the Ad Note is part of the GATT 1994223, the resolution of this issue rests on whether the 
EBR is consistent with the Ad Note.   
204. Thailand and India contend on appeal that the temporal scope of the Ad Note is restricted to 
securities taken as provisional measures.  They cl aim that the Panel erred in finding that the Ad Note 
authorizes the imposition of security requirements also after the imposition of a United States anti-
dumping duty order and that, accordingl y, the application of the EBR falls within the temporal scope 
of the Ad Note.224 
                                                      
220Panel Report, US – Shrimp (Thailand) , para. 7.90.  See also Panel Report, US – Customs Bond 
Directive , para. 7.64. 
221Panel Report, US – Shrimp (Thailand) , para. 7.150;  Panel Report, US – Customs Bond Directive , 
para. 7.128. 
222Panel Report, US – Shrimp (Thailand) , paras. 7.151 and 7.152;  Panel Report, US – Customs Bond 
Directive , paras. 7.129 and 7.130. 
223Panel Report, US – Shrimp (Thailand) , footnote 136 to para. 7.88;  Panel Report, US – Customs 
Bond Directive , footnote 99 to para. 7.62. 
224Panel Report, US – Shrimp (Thailand) , para. 7.130;  Panel Report, US – Customs Bond Directive , 
para. 7.107. WT/DS343/AB/R 
WT/DS345/AB/R Page 78 
 
 
205. The Ad Note to Article VI:2 and 3 of the GATT 1994 provides, in relevant part: 
As in many other cases in customs administration, a Member may 
require reasonable security (bond or  cash deposit) for the payment of 
anti-dumping or countervailing duty pending final determination of 
the facts in any case of suspected dumping or subsidization. 
206. The Panel examined the relationship between the Ad Note and the Anti-Dumping Agreement , 
and addressed the question of whether the Ad Note authorizes the imposition of security requirements 
that are not expressly envisaged by the Anti-Dumping Agreement .  The Panel considered that the 
Appellate Body Report in Brazil – Desiccated Coconut  makes it clear that Article VI of the GATT 
1994 (including the Ad Note) was not superseded by the Anti-Dumping Agreement .
225  The Panel 
reasoned that, whereas Article VI may not be interpre ted so as to justify action that is prohibited by 
the Anti-Dumping Agreement , Article VI can be an appropriate legal basis for authorizing a conduct 
that is not prohibited by the Anti-Dumping Agreement .  According to the Panel, "[a]ny other approach 
would deprive the Ad Note of meaning and legal e ffect, and would effectively mean that it has been 
superseded by the Anti-Dumping Agreement ."226  The Panel also discussed th e statements made by the 
Appellate Body in US – 1916 Act and US – Offset Act (Byrd Amendment ) that "Article VI and, in 
particular, Article VI:2, read in conjunction with the Anti-Dumping Agreement , limit the permissible 
responses to dumping to 'definitive anti-dumping duties, provisional measures and price undertakings'".
227  For the Panel, these statements did not undermine its reasoning because in neither 
report did the Appellate Body refer to the Ad Note.228  The Panel therefore concluded that "the 
relationship between the Ad Note and the Anti-Dumping Agreement  is not such as to preclude the 
Ad Note authorizing certain types of secur ity that are not expressly envisaged by the Anti-Dumping 
Agreement ."229 
207. The Panel then examined the ordinary meaning of the Ad Note, noting that, by its express 
terms, the Ad Note is applicable "pending final determin ation of the facts in any case of suspected 
dumping or subsidization".  Regarding the term "sus pected", the Panel considered that it refers to 
                                                      
225Panel Report, US – Shrimp (Thailand) , para. 7.92;  Panel Report, US – Customs Bond Directive , 
para. 7.72. 
226Panel Report, US – Shrimp (Thailand) , para. 7.94;  Panel Report, US – Customs Bond Directive , 
para. 7.73. 
227Appellate Body Report, US – 1916 Act , para. 137;  Appellate Body Report, US – Offset Act (Byrd 
Amendment) , para. 265. 
228Panel Report, US – Shrimp (Thailand) , para. 7.97;  Panel Report, US – Customs Bond Directive , 
para. 7.76. 
229Panel Report, US – Shrimp (Thailand) , para. 7.98;  Panel Report, US – Customs Bond Directive , 
para. 7.77.  WT/DS343/AB/R 
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"dumping that is suspected to exist, in the sense th at its existence may be imagined to be likely."230  
For the Panel, there is no certainty that imports entering the United States after the imposition of an 
anti-dumping duty order are in fact dumped sin ce the determination of dumping made during the 
original investigation did not pertain to these impor ts, and the final determination (of the existence 
and amount) of dumping is only made when  an assessment review is undertaken.231  The Panel 
reasoned that there is, however, a reasonable basis fo r suspecting that imports subsequent to the order 
might also be dumped due to the finding of dumping  made in respect of imports that entered during 
the original period of investigation.232  In the Panel's view, even when no assessment review is 
ultimately conducted, at the time of entry, imports  may only be suspected of being dumped, because, 
at that point in time, it cannot be excluded that an  assessment review may be requested, which might 
show that those imports are not dumped.233 
208. Regarding the meaning of the phrase "pending final determination of the facts" in the 
Ad Note, the Panel took the view that this phrase is not necessarily limited to the final determination 
made in an original investigation and that it may well cover the "determination of the final liability for 
payment of anti-dumping duties" referred to in Article 9.3.1 of the Anti-Dumping Agreement .  For the 
Panel, such an interpretation is consistent with  the manner in which a retrospective duty assessment 
system operates. 
209. The Panel also addressed contextual considerati ons arising from Articles 5.1 and 9.3.1 of the 
Anti-Dumping Agreement , as well as Article 7 of the Anti-Dumping Agreement .  The Panel rejected 
the argument of Thailand and India that dumping ca nnot be suspected after the existence of dumping 
has been determined in an original investigation within the meaning of Article 5.1.  Relying on the 
Appellate Body Report in Mexico – Anti-Dumping Measures on Rice , the Panel held that the 
conditions for imposing anti-dumping duties, including the existence of dumping, must be established 
in respect of the "current situation" at the time of their imposition.234  The Panel considered that the
                                                      
230Panel Report, US – Shrimp (Thailand) , para. 7.101.  See also Panel Report, US – Customs Bond 
Directive , para. 7.80. 
231Panel Report, US – Shrimp (Thailand) , para. 7.103;  Panel Report, US – Customs Bond Directive , 
para. 7.82. 
232Panel Report, US – Shrimp (Thailand) , para. 7.104;  Panel Report, US – Customs Bond Directive , 
para. 7.83. 
233Panel Report, US – Shrimp (Thailand) , paras. 7.106 and 7.107;  Panel Report, US – Customs Bond 
Directive , paras. 7.89 and 7.90. 
234Appellate Body Report, Mexico – Anti-Dumping Measures on Rice , para. 165. WT/DS343/AB/R 
WT/DS345/AB/R Page 80 
 
 
fact that the United States establishes, under Artic le 5.1, the existence of dumping at the time it 
imposes an anti-dumping duty order, "does not mean that the United States is at the same time 
establishing the existence of dumping in respect of future import entries covered by that order."
235 
210. The Panel also rejected the argument that the refe rence in Article 9.3.1 to the determination of 
"final liability for payment of anti-dumping duties" n ecessarily implies that ther e has previously been 
a determination that dumping exists  and dumping is, therefore, no longer suspected.  In a retrospective 
duty assessment system, determini ng final liability for payment of anti-dumping duties takes place 
after the import entries have been made, and accordi ng to the Panel, part of the process of determining 
"final liability for payment of anti-dumping duties" is  to determine whether or not those entries were 
dumped.236  Furthermore, the Panel saw no cont extual support in Article 7 of the Anti-Dumping 
Agreement  for an interpretation of the Ad Note that would limit its temporal scope to provisional 
measures taken prior to the imposition of an anti-dumping duty order.237   
211. Within its contextual analysis, the Panel also dealt with the question of whether cash deposits 
are anti-dumping duties within the meaning of Article 9 of the Anti-Dumping Agreement , or whether 
they are securities.238  The Panel noted that the retrospectiv e duty assessment system is specifically 
contemplated by Article 9.3.1 of the Anti-Dumping Agreement , and that the ability to require security 
is an essential element of such a system.  For th e Panel, if a cash deposit may not be imposed under 
other provisions of the GATT 1994 or the Anti-Dumping Agreement , an interpretation of the Ad Note 
permitting such security would be further justified.239  This is so because, in the absence of a legal 
justification of cash deposits under the Ad Note, or any other provision of the GATT 1994 or the Anti-
Dumping Agreement , cash deposits would constitute "specifi c action against dumping" contrary to 
Article 18.1 of the Anti-Dumping Agreement .  For the Panel, these consid erations provided contextual 
support for its interpretation of the ordinary meaning of the Ad Note as permitting such security.240 
                                                      
235Panel Report, US – Shrimp (Thailand) , para. 7.109. 
236Ibid., para. 7.110. 
237Panel Report, US – Customs Bond Directive , paras. 7.91-7.95. 
238Panel Report, US – Shrimp (Thailand) , paras. 7.111-7.122;  Panel Report, US – Customs Bond 
Directive , paras. 7.96-7.107. 
239Panel Report, US – Shrimp (Thailand) , para. 7.112;  Panel Report, US – Customs Bond Directive , 
para. 7.97. 
240Panel Report, US – Shrimp (Thailand) , para. 7.122;  Panel Report, US – Customs Bond Directive , 
para. 7.106.  WT/DS343/AB/R 
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212. In addition, the Panel examined aspects of the negotiating history of the Ad Note and 
Article VI of the GATT 1994.  The Panel was of the view that nothing in the negotiating history 
supports the argument that the Ad Note is expressly limited to provisional measures taken prior to a 
final determination of dumping.241  
213. In the light of these considerations, the Panel found that "the application of the EBR falls 
within the temporal scope of the Ad Note, in th e sense that the Ad Note authorizes the imposition of 
security requirements during the period following  the imposition of a [United States] anti-dumping 
[duty] order."242 
214. Both Thailand and India appeal this finding of  the Panel.  Thailand requests the Appellate 
Body to reverse the Panel's interpretation of the phrase "pending final determination of the facts in 
any case of suspected dumping" in the Ad Note.  Thailand considers that the temporal scope of this 
phrase is limited to the time period before the existence of dumping has been established in an 
original investigation under Article 5 of the Anti-Dumping Agreement , and that the Panel's 
interpretation of the Ad Note is inconsistent with the ordinary meaning of this phrase read in the 
context of Article VI of the GATT 1994 and the Anti Dumping Agreement.243  Thailand disagrees with 
the Panel that there can only be a "suspicion" of dumping with respect to individual import 
transactions after the imposition of a definitive anti-dumping duty order.244  For Thailand, dumping is 
a present, continuous, and ongoing "state of affairs", a nd, therefore, after the existence of dumping has 
been established in an original investigation, dumping is no longer "suspected" but is considered to be 
occurring, even if the final liability for payment of anti-dumping duties may not have been 
assessed.245  As definitive duties can be imposed under Article 9 only after a finding of injurious 
dumping, a case of "suspected dumping" within the meaning of the Ad Note cannot continue to exist 
after the decision has been made to impose defi nitive anti-dumping measures under Article 9.1 of the 
Anti-Dumping Agreement .246  Thailand also argues that the Panel failed to take properly into account 
the fact that administrative reviews under Articl es 9.3.1 and 9.3.2 are not mandatory and may never 
take place.247  Finally, Thailand maintains that Article 7 of the Anti-Dumping Agreement , dealing with 
                                                      
241Panel Report, US – Shrimp (Thailand) , paras. 7.123-7.130;  Panel Report, US – Customs Bond 
Directive , paras. 7.94 and 7.95.  The Panel referred to the 1959 Group of Experts Report, supra , footnote 41, 
para. 19, as well as to the Report of Working Pa rty on Modifications to the General Agreement, 
GATT/CP.2/22/Rev. 1, adopted 1 September 1948, BISD II/37, para. 10(a). 
242Panel Report, US – Shrimp (Thailand) , para. 7.130;  Panel Report, US – Customs Bond Directive , 
para. 7.107. 
243Thailand's appellant's submission, US – Shrimp (Thailand) , para. 5. 
244Ibid., para. 35.  
245Ibid., paras. 40 and 41. 
246Ibid., para. 60. 
247Ibid., paras. 67-69. WT/DS343/AB/R 
WT/DS345/AB/R Page 82 
 
 
provisional measures in the original investig ation phase, governs the application of the Ad Note.
248  
Thailand emphasizes that the Panel's interpretation of the Ad Note is not consistent with the previous 
jurisprudence of the Appellate Body because it creates an impermissible fourth response to 
dumping.249   
215. For its part, India argues that the Panel erred in  its interpretation of the phrase "the provisions 
of GATT 1994 as interpreted by this Ag reement" in Article 18.1 of the Anti-Dumping Agreement  and 
in Article 32.1 of the SCM Agreement .  According to India, any interpretation of the Ad Note that 
would authorize the United States to impose the EBR independently of the three permissible specific 
actions against dumping under the Anti-Dumping Agreement , or of the four permissible specific 
actions under the SCM Agreement , would render this phrase redundant a nd inutile.250  For India, the 
Panel's position that the taking of a reasonable secu rity for the payment of anti-dumping duties is a 
permissible action against dumping is not consis tent with the Appellate Body's findings in US – 1916 
Act and US – Offset Act (Byrd Amendment) .  India submits that, in interpreting the Ad Note, the Panel 
"worked backwards" from its strongly held convic tion that it was essential that Members using the 
retrospective duty assessment system be permitted to take security.251  The Panel's interpretation 
implies that suspicion of dumping begins after the final determination of the existence of injurious 
dumping, which is untenable.252   
216. India also maintains that the Panel erred in  interpreting and applying the term "final 
determination" in the Ad Note.  For India, there is only one final determination in the life of an anti-
dumping or countervailing duty order, and that fina l determination precedes the decision to impose a 
duty under Article 9.1 of the Anti-Dumping Agreement , or under Articles 19.1 and 19.2 of the 
SCM  Agreement .253  India considers that the Panel's interpretation of the Ad Note confers an unfair 
advantage on Members using retrospective duty asse ssment systems as it permits them to impose an 
additional charge over and above the anti-dum ping duty rate established in the original
                                                      
248Thailand's appellant's submission, US – Shrimp (Thailand) , para. 56. 
249Ibid, para. 79 (referring to Appellate Body Report, US – 1916 Act , para. 114;  and Appellate Body 
Report, US – Offset Act (Byrd Amendment) , paras. 264 and 265).  Also Thailand's appellant's submission, US – 
Shrimp (Thailand) , para. 84. 
250India's appellant's submission, US – Customs Bond Directive , para. 15. 
251Ibid., para. 55. 
252Ibid., paras. 58 and 59. 
253Ibid., para. 63.  WT/DS343/AB/R 
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investigation.254  India further submits that Article 7 of the Anti-Dumping Agreement  and Article 17 of 
the SCM Agreement  implement the Ad Note to the extent that these provisions permit security to be 
taken as a provisional measure, and that the United States cannot justify the EBR under the Ad Note 
independently of these provisions.255   
217. In response, the United States argues that the phr ase "final determination of the facts" in the 
Ad Note refers to the determination of the facts with respect to the " payment  of anti-dumping or 
countervailing duty".256  In the context of a retrospective duty assessment system, the "determination 
of the final liability for payment of anti-dumping duties", referre d to in Article 9.3.1, must be made in 
order for the facts with respect to payment to be determined.257  Thus, for the United States, the term 
"payment" in the Ad Note is critical to determine the scope of application of the Ad Note.   
218. The United States rejects the view that the imposition of an anti-dumping duty order means 
that dumping is no longer "suspected".  Rather, th e United States agrees with the Panel that proof of 
the existence of dumping with respect to past im port entries during the period of investigation does 
not mean that the existence of dumping is being estab lished in respect of future import entries covered 
by an anti-dumping duty order.258  For the United States, the argument that Article 7 of the Anti-
Dumping Agreement  governs the application of the Ad Note is based on the erroneous assumption 
that, if provisional measures within the meaning of  Article 7 may take the form of security, all 
security requirements must be provisional measures as well.  The fact that both Article 7 and the Ad Note refer to "cash deposits and bonds" does not imply that all securities must be provisional.
259  
The United States considers that the Appellate Body Reports in US – 1916 Act  and US – Offset Act  
(Byrd Amendment)  are not dispositive of the interpretation of the Ad Note as these reports do not 
contain any analysis of the Ad Note and were not concerned with security requirements for final anti-
dumping duties.260  The United States is of the view that the Panel correctly articulated the 
relationship between the Anti-Dumping Agreement  and the Ad Note.  For the United States, there is no 
basis for prohibiting an action that is authorized by the Ad Note and that is not addressed by the Anti-
                                                      
254India's appellant's submission, US – Customs Bond Directive , para. 75. 
255India's appellant's submission, US – Customs Bond Directive , para. 81. 
256United States' appellee's submissions, US – Shrimp (Thailand) , para. 11 and US – Customs Bond 
Directive , para. 15. (emphasis added by the United States) 
257United States appellee's submissions, US – Shrimp (Thailand) , para. 11 and US – Customs Bond 
Directive , para. 15. (emphasis added by the United States) 
258United States appellee's submission, US – Shrimp (Thailand) , para. 20 (referring to Panel Report, US 
– Shrimp (Thailand) , para. 7.109).  
259United States' appellee's submissions, US – Shrimp (Thailand) , para. 29 and US – Customs Bond 
Directive , para. 23. 
260United States' appellee's submissions, US – Shrimp (Thailand) , para. 46 and US – Customs Bond 
Directive , para. 34. WT/DS343/AB/R 
WT/DS345/AB/R Page 84 
 
 
Dumping Agreement .
261  The United States points out that precluding WTO Members with 
retrospective duty assessment systems from taking secur ity prior to the determination of final liability 
would prevent such Members from collecting duties la wfully owed, and would result in an asymmetry 
between prospective and retrospective duty assessment systems.262 
219. We turn now to the analysis  of the question whether the Ad Note authorizes security 
requirements after the imposition of an anti-dumpi ng duty order and, accordingly, whether the 
application of the EBR falls within the temporal scope of the Ad Note. 
1. Interpretation of the Phrase "pending fi nal determination of the facts in any 
case of suspected dumping"  
220. We begin with the interpretation of the phrase "p ending final determination of the facts in any 
case of suspected dumping" in the Ad Note, as this phrase is central to determining the question 
whether security may be taken after the imposition of  an anti-dumping duty order.  In particular, we 
need to ascertain the ordinary meaning of the terms "final determination of the facts" and "suspected 
dumping".  The parties disagree on the question as to wh ich "final determination"  is referred to in the 
Ad Note:  the determination pursuant to which an an ti-dumping duty order is imposed at the end of an 
original investigation;  or the determination of  the final liability for payment of anti-dumping duties 
pursuant to an assessment review under a retrospec tive duty assessment system.  The parties disagree 
also on the question as to whether dumping remains "suspected" only up to the imposition of the anti-dumping duty order, or whether it continues to remain "suspected" until the final liability is 
determined in successive assessment reviews and, a ccordingly, during the lifetime of an anti-dumping 
duty order under a retrospec tive duty assessment system.   
221. We find useful guidance for interpreti ng the terms of this phrase in the Ad Note in the 
immediate context in which they appear.  The Ad Note refers to "security ... for the payment  of anti-
dumping or countervailing ... duty".
263  In our view, this reference to the payment  of a duty is key to 
ascertaining the temporal scope of the Ad Note because it reveals the nature of the obligation whose 
performance the security s eeks to guarantee.  The obligation that  is intended to be secured under the 
Ad Note is the "payment of anti-dumping or countervailing duty".  In other words, the Ad Note 
recognizes the right of WTO Members to take reasona ble security against the risk of non-payment of 
an anti-dumping or countervailing duty that is lawfully  established.  This risk might exist during the 
period of an original investigation, and a provisiona l measure in the form of a security may be taken 
                                                      
261United States' appellee's submissions, US – Shrimp (Thailand) , para. 25 and US – Customs Bond 
Directive , para. 18. 
262United States' appellee's submissions, US – Customs Bond Directive , para. 16. 
263Emphasis added.  WT/DS343/AB/R 
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in accordance with Article 7 of the Anti-Dumping Agreement  to protect against this risk.  In a 
retrospective duty assessment system, this risk might  also exist after the anti-dumping duty order has 
been imposed, arising from the difference between the amount collected at the time of import entry 
and the final liability assessed in an assessment review.  The Ad Note also suggests that the reasonable 
security envisaged by it fulfils the same function as the securities taken "in many other cases in customs administration".  As the United States points out, in most other cases in customs administration, security is required upon entry of merchandise when there is some uncertainty about 
the actual amount of liability that may be lawfully owed by the importer.
264  Such a security is 
intended to provide a protection against the non-pa yment risk that might arise from the differences 
between the amount collected at the time of im portation and the liability that may be finally 
determined.  Accordingly, we are of the view that the term "final determination" in the Ad Note 
includes the determination that is made to assess the fi nal liability for payment of anti-dumping duties 
under Article 9.3.1 in a retrospective duty assessment system.  The "facts" are those that are necessary 
to be determined in order to assess properly the amount of final liability of the duty in accordance with the Anti-Dumping Agreement .   
222. In the retrospective duty assessment system followed by the United States, the factual 
determination of the amounts of anti-dumping duties pa yable by the importers is not complete until an 
assessment review has been conducted.  A factual determination of the amount of anti-dumping duties 
payable occurs even if an assessment review does not take place.  If no interested party requests an 
assessment review, the USDOC will instruct Unite d States Customs to assess anti-dumping duties and 
liquidate the import entries at the cash deposit rate required upon import entry.  This cash deposit rate 
is determined for each exporter or producer individu ally investigated, and is established on the basis 
of its transactions over the period covered by the or iginal investigation or the latest assessment 
review, as the case may be.  Thus, even in the even t that no assessment review has been requested, the 
final determination of the facts includes a dete rmination regarding amount s of anti-dumping duties 
finally payable, as the USDOC has to instruct Unite d States Customs to liquidate the import entries on 
the basis of the cash deposit rates. 
223. We are not persuaded by the arguments of Thailand and India that the phrase "final 
determination of the facts" refers  to the determination of injurious dumping made in an original 
investigation pursuant to Article 5 of the Anti-Dumping Agreement  and that there is only one "final 
                                                     
 
264United States' appellee's submissions, US – Shrimp (Thailand) , US – Customs Bond Directive , 
para. 12. WT/DS343/AB/R 
WT/DS345/AB/R Page 86 
 
 
determination of the facts" in the life of an anti-dumping duty measure.
265  As we have explained 
above, determination of the facts is not final within the meaning of the Ad Note in a retrospective duty 
assessment system until the amount of the liability fo r payment of anti-dumping duty is determined in 
the assessment review.266    
224. We turn next to the term "suspected dumping" in the phrase under review.  Thailand and India 
point out that, under the Ad Note, a security can only be taken "i n ... case of suspected dumping or 
subsidization".  According to them, once the dete rmination of injurious dumping is made in an 
original investigation pursuant to Article 5 of the Anti-Dumping Agreement , the existence of dumping 
is no longer suspected, but established.  As the phrase "final determination of the facts" refers to the 
final determination in any case of "suspected dumping", and as dumping can no longer be suspected 
after an original investigation and the issuance of  an anti-dumping duty order under Article 9.1, they 
argue that the Ad Note has a temporal scope limited to provisional measures taken prior to the 
determination of injurious dumping.   
225. The Panel took the view that, under the retros pective duty assessment system of the United 
States, dumping remains suspected even after the issuance of an anti-dumping duty order.  The Panel reasoned that there is no certainty that imports entering the United States following the imposition of 
an anti-dumping duty order are in fact dumped, be cause the determination of dumping made during 
the original investigation does not pertain to those import transactions.  According to the Panel, with 
respect to the import transactions subsequent to  the issuance of an anti-dumping duty order, the 
existence  of dumping is established only when an assessme nt review is undertaken and the final duty 
liability is assessed.  On this specific point, we disag ree with the Panel's reasoning.  Under the United 
States' anti-dumping duty system, the existence of dumping, as well as the existence of injury and the 
causal link between the two, is determined in an or iginal investigation conducted pursuant to Article 5 
of the Anti-Dumping Agreement .  The legal basis for collection of cash deposits at the anti-dumping 
duty rate and determination of the final liability fo r payment of anti-dumping duties in an assessment 
review under the United States' retrospective duty assessment system is the fact that these three 
determinations (dumping, injury, and the causal link between the two) have been made prior to the 
imposition of the anti-dumping duty order.  Therefore, under the United States' system, the 
                                                     
 
265The term "injurious dumping" refers to the findings of dumping and injury and a causal link between 
the two by an investigating authority in an original investigation.  
266We find support for our interpretation by referring to the equally authentic French and Spanish 
versions of the relevant provisions.  In the French and Spanish versions of the Ad Note the phrase "final 
determination of the facts" is, respectively, " la constatation définitive des faits " and " la comprobación definitiva 
de los hechos ".  By contrast, the terms " détermination " (in French) and " determinación " (in Spanish) are used in 
Article 5 of the Anti-Dumping Agreement , whereas the English version uses the term "determination" in both 
Article 5 and the Ad Note.    WT/DS343/AB/R 
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uncertainty subsequent to the original investigation period pertains only to the amount  of the final 
liability for the payment of anti-dumping duties, and there is no uncertainty with respect to the 
existence  of dumping.  This is also clear from the fact that, even where the duty assessment rate of an 
importer is zero in an assessment review, that impor ter will continue to make cash deposits for future 
entries of subject merchandise at the going-forwar d cash deposit rate of the exporter concerned.  
Footnote 22267 of the Anti-Dumping Agreement  also confirms this point as it distinguishes between the 
existence  and the amount  of dumping in a retrospective duty assessment system.  Furthermore, under 
United States law, an anti-dumping duty order remains in effect until it is revoked, meaning, thereby, 
that dumping is considered to "e xist" until the order is revoked. 
226. Although we do not agree with the Panel that the "existence" of dumping remains "suspected" 
under the United States' retrospec tive duty assessment system even after the imposition of the anti-
dumping duty order, we are of the view that the term "dumping" in the Ad Note covers both the 
existence  of dumping and the amount  or margin of dumping.  Dumping and margin of dumping—
which measures the magnitude of dumping—are in ter-related concepts.  Under the United States' 
retrospective duty assessment system, the magnitude  of dumping, or, in other words, the amount of 
final liability for payment of anti-dumping duties, is determined only in an assessment review.  Thus, 
dumping remains "suspected" within the meaning of the Ad Note as regards its magnitude  for the 
import entries occurring after the anti-dumping duty or der is imposed.  Until an assessment review is 
conducted and the import entries are liquidated, there remains uncertainty regarding the magnitude  of 
dumping, so that dumping remains in this respect, and until then, "suspected".268   
227. For these reasons, we find that the Ad Note authorizes the taking of a reasonable security after 
the imposition of an anti-dumping duty order, pendi ng the determination of the final liability for 
payment of the anti-dumping duty.  In our view, th is finding is neutral as between prospective and 
retrospective duty assessment systems, because the dete rmination of the final liability for payment of 
duty takes place in a retrospective system in assess ment reviews subsequent to the imposition of the 
anti-dumping duty order. 
                                                      
267Footnote 22 of the Anti-Dumping Agreement , reads as follows:   
When the amount of the anti-dumping duty is assessed on a retrospective 
basis, a finding in the most recent assessment proceeding under 
subparagraph 3.1 of Article 9 that no duty is to be levied shall not by itself 
require the authorities to terminate the definitive duty.  
268As noted in paragraph 222 above, where no asse ssment review is requested, the USDOC instructs 
the United States Customs to liquidate the import entries on the basis of the cash deposit rate of the original anti-
dumping duty order or the cash deposit rate assessed for the exporter in the most recent assessment review.  
Whether or not an assessment review will be requested (and whether the final liability will be assessed at the 
previous cash deposit rate or accordin g to the current data) is not known ex ante .  Thus, even in the event that no 
assessment review is requested, until liquidation of the im port entries, there is some uncertainty regarding the 
magnitude of dumping. WT/DS343/AB/R 
WT/DS345/AB/R Page 88 
 
 
228. We turn now to examine two additional consider ations that, according to Thailand and India, 
go against an interpretation of the Ad Note that extends its temporal scope beyond security taken as a 
provisional measure.   
2. Impermissible Response to Dumping
 
229. Thailand and India rely on the Appellate Body statement in US – 1916 Act  and US – Offset 
Act (Byrd Amendment)  that "Article VI, and, in particular, Article VI:2, read in conjunction with the 
 Anti-Dumping Agreement , limit the permissible responses to dumping to definitive anti-dumping 
duties, provisional measures and price undertakings".269  According to Thailand and India, if the 
temporal scope of the Ad Note is not limited to provisional measures, and if security (such as a bond) 
for potential increase in duty liability after the im position of an anti-dumping duty order is allowed 
under the Ad Note, such a security would constitute a fourth  permissible response to dumping.  This 
would be contrary to the above statement of the Appellate Body. 
230. Before addressing the arguments of Thailand and India, we reaffi rm the Appellate Body 
findings in previous reports that the Anti-Dumping Agreement  does not allow a fourth category of 
specific action against dumping.270  We do not, however, consider that a security taken for 
guaranteeing the payment of a lawfully establishe d duty liability would necessarily constitute a 
"specific action against dumping";  rather, whether a particular security constitutes a "specific action 
against dumping" should be evaluated in the light of  the nature and characteristics of the security and 
the particular circumstances in which it is applie d.  We wish to emphasize that, in any event, an 
impermissible specific action against dumping cannot be taken in the guise of a security. 
231. Generally speaking, a security is accessory or ancillary to the principal obligation that it 
guarantees.  A security that is taken to guarantee the obligation to pay anti-dumping or countervailing 
duties is intrinsically linked to that obligation.  Th us, taking security for the full and final payment of 
duties should be viewed as a component of th e imposition and collection of anti-dumping or
                                                      
269Appellate Body Report, US – 1916 Act , para. 137 (quoted in Appellate Body Report, US – Offset Act 
(Byrd Amendment) , para. 265). 
270Ibid., paras. 81 and 137;  Appellate Body Report, US – Offset Act (Byrd Amendment) , paras. 265 and 
269.  See also Appellate Body Report, Mexico – Anti-Dumping Measures on Rice , paras. 113 and 115.  WT/DS343/AB/R 
 WT/DS345/AB/R 
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countervailing duties.  Therefore, a reasonabl e security taken in accordance with the Ad Note for 
potential additional anti-dumping dut y liability does not necessarily, in and of itself, constitute a 
fourth autonomous category of response to dumping.271   
3. The Ad Note to Article VI:2 and 3 of the GATT 1994 and Article 7 of the 
Anti-Dumping Agreement  (Provisional Measures)  
232. The second additional consideration raised by Thailand and India is that Article 7 of the 
Anti-Dumping Agreement  on provisional measures interpre ts, governs, and implements the Ad Note to 
Article VI:2 and 3 of the GATT 1994, and that, ther efore, a security cannot be justified under the 
Ad Note independently of Article 7.  Accord ing to Thailand and India, the scope of the Ad Note 
should therefore be limited to securities taken as a pr ovisional measure in accordance with Article 7.  
233. We agree with Thailand and India that there is some overlap between the Ad Note and 
Article 7.  The Ad Note allows security in the form of  provisional measures during the original 
investigation period, the disciplines of which are impl emented through Article 7.  At the same time, in 
our view, the Ad Note allows the taking of a reasonable secu rity for payment of the final liability of 
anti-dumping duties after an anti-dumping duty order has been imposed where such security may be 
needed to ensure that the diffe rence between the duty collected on import entries and the final duty 
liability is collected.  We therefore do no t agree with Thailand and India that the Ad Note is 
completely subsumed under Article 7 so that the ta king of a reasonable security is not allowed after a 
definitive anti-dumping duty is imposed.  As the Appellate Body clarified in Brazil – Desiccated 
Coconut , the Anti-Dumping Agreement  does not supersede the provisions of the GATT 1994, 
including the Notes and Supplementary Provisions of Annex I to the GATT 1994.272  R a t h e r ,  
Article VI of the GATT 1994 (including the Ad Note) and the Anti-Dumping Agreement  represent an 
inseparable package of rights and disci plines.  Our interpretation of the Ad Note is consistent with this 
approach as it gives meaning and effect to both. 
                                                      
271Our views on what would constitute a "reasonable" security and how "potential additional liability" 
and "risk of default" are to be established to justify a security under the Ad Note are explained in Section VI of 
this Report. 
272Appellate Body Report, Brazil – Desiccated Coconut , p. 14, DSR 1997:I, 167, at 179.  WT/DS343/AB/R 
WT/DS345/AB/R Page 90 
 
 
4. The Panel's Legal Characterization of Cash Deposits
 
234. We now turn to the issue of whether the Panel erred in its interpretation that (i) cash deposits 
required under United States law are not anti-dumping duties falling within the scope of the Anti-
Dumping Agreement , and that (ii) these cash deposits are not subject to the requirements of Article 9.1 
and the chapeau of Article 9.3 that the amount of  anti-dumping duties shall not exceed the margin of 
dumping established under Article 2 of the Anti-Dumping Agreement . 273   
235. The Panel addressed the question of cash depos its only as a contextual consideration in 
support of its conclusion that the Ad Note allows security to be ta ken after the imposition of an anti-
dumping duty order.  Thailand and I ndia did not claim before the Pane l that the cash deposits taken by 
the United States under its retrospective duty assessment  system are WTO-inconsistent.  In our view, 
the outcome of this case in relation to the WTO-c onsistency of the EBR does not depend on the legal 
characterization of the cash deposits required by United States law on imports subject to an anti-
dumping duty order.  Indeed, the "Conclusions an d Recommendations" of the Panel Reports make no 
reference to cash deposits. 
236. The Panel took the view that cash deposits are securities and that they are not anti-dumping 
duties governed by Article 9 of the Anti-Dumping Agreement .  For the Panel, the term "duty" is not 
broad enough to encompass cash deposits, because a cash deposit does not "yield public revenue at 
the time it is provided" and it is without intrinsic value.274  The Panel found contextual support for its 
view in various provisions of the Anti-Dumping Agreement .275    
237. On appeal, Thailand and India challenge the Pa nel's interpretation that cash deposits are not 
anti-dumping duties governed by Article 9 of the Anti-Dumping Agreement , but are, rather, securities 
to secure payment of final anti-dumping duties.  Th ailand notes that, under United States law, the cash 
deposits required after the publication of the anti- dumping duty order are referred to as deposits "of 
estimated antidumping duties".276  By contrast, United States law governing provisional measures uses 
the same terminology as Article 7 of the Anti-Dumping  Agreement , and describes a provisional 
                                                      
273Panel Report, US – Shrimp (Thailand) , para. 7.122;  Panel Report, US – Customs Bond Directive , 
para. 7.106. 
274See Panel Report, US – Shrimp (Thailand) , paras. 7.113 and 7.114;  and Panel Report, US – Customs 
Bond Directive , para. 7.98. 
275See Panel Report, US – Shrimp (Thailand) , para. 7.115-7.119;  and Panel Report, US – Customs 
Bond Directive , para. 7.99-7.105.   
276Thailand's appellant's submission, US – Shrimp (Thailand) , para. 122 (referring to Tariff Act, 
supra , footnote 53, Section 1673e(a)(3)).  This provision of  the Tariff Act requires "the deposit of estimated 
antidumping duties pending liquidation of entries of merchandise at the same time as estimated normal customs 
duties on that merchandise are deposited."  WT/DS343/AB/R 
 WT/DS345/AB/R 
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measure as a "cash deposit, bond, or other security"277 with no reference to the term "estimated 
duties".278  Thailand submits that cash deposits are duties because their purpose is to offset or 
counteract injurious dumping;  the fact that the amount of final liability for anti-dumping duties may 
be different from the amount collected as cash deposits does not affect their fundamental nature.279  
Thailand also argues that the Panel erred in cons idering that cash deposits have no intrinsic value 
since, being paid in cash, cash deposits have the same cash value to the importing Member as any 
other payment of duties or any other payment of cash.280   
238. India argues that there is no substantive di fference between "cash deposits" and "cash" in 
payment of anti-dumping duties.281  India refers to submissions made by the United States to the 
Negotiating Group on Rules in relation to Article  9.3 in which the United States had allegedly 
characterized payments of cash deposits made under Article 9.3.1 as "duties".282  For India, the cash 
deposits, however characterized, cannot be collected in  excess of the margins specified in Article 9.3 
of the Anti-Dumping Agreement  and Article 19.4 of the SCM Agreement .283 
239. The United States supports the Panel's view th at a cash deposit is security for a duty owed, 
and is not itself a duty.  Like the Panel, the Unite d States notes that Article 7.2 distinguishes a "cash 
deposit" as a form of security from "duties", and ag rees with the Panel that, in indicating a preference 
for requiring payment of cash deposits, rather than  duties, the text of Article 7.2 establishes a 
substantive difference betw een a cash deposit and a duty.284  For the United States, a cash deposit of 
estimated duties is a security for duties that may be collected in the future, and there is no duty in the 
absence of any such future collection.285  The United States argues that the fact that cash deposits are
                                                      
277Thailand's appellant's submission, US – Shrimp (Thailand) , para. 122 (referring to Tariff Act, supra , 
footnote 53, Section 1673b(d)(2)). 
278Ibid. 
279Ibid., para. 127. 
280Ibid., para. 124.  
281India's appellant's submission, US – Customs Bond Directive , para. 109. 
282Negotiating Group on Rules, "Accrual of Interest (ADA Articles 9.3.1 & 9.3.2)", Communication 
from the United States, TN/RL/W/168. 
283India's appellant's submission, US – Customs Bond Directive , para. 114. 
284United States' appellee's submissions, US – Shrimp (Thailand) , para. 38 and US – Customs Bond 
Directive , para. 29.   
285United States' appellee's submission, US – Shrimp (Thailand) , para. 39. WT/DS343/AB/R 
WT/DS345/AB/R Page 92 
 
 
"paid in cash" does not make them "duties".
286  Furthermore, the United States denies that its 
statements to the Negotiating Group on Rules a nd in other dispute settlement proceedings support 
India's proposition, and submits that they do not provide a basis to depart from the ordinary meaning 
of the terms used in the covered agreements.287 
240. We are of the view that, in order to interpret the Ad Note and determine the WTO-consistency 
of the bonds  required under the EBR, it was not necessary for the Panel to decide whether the cash 
deposits are duties governed by Article 9 of the Anti-Dumping Agreement .  As Thailand and India did 
not raise any claim regarding the cash deposits, the c ash deposits are not a measure at issue in these 
disputes.   
241. At the oral hearing, Thailand and India agreed  that the legal characterization of the "cash 
deposits" or their nomenclature under the domestic law of the United States is not relevant to 
determine the WTO-consistency of the EBR (provide d the cash deposits are subject to the disciplines 
of Article 9 of the Anti-Dumping Agreement ).288  While the description of an instrument under 
domestic law is not determinative under WTO la w, we note that under the United States' anti-
dumping law, once an anti-dumping duty order is  issued, importers may no longer post bonds as 
security, but, instead, must make a cash "depos it of estimated antidumping duties" at the rates 
established in the anti-dumping duty order or  in the most recent assessment review.289  Thus, a cap on 
the cash deposits equivalent to the margin of dumpi ng established for an exporter in the anti-dumping 
duty order, or in the most recent assessm ent review, exists under United States law. 
                                                      
286United States' appellee's submission, US – Shrimp (Thailand) , para. 40.  
287United States' appellee's submission, US – Customs Bond Directive , para. 30 (referring to India's 
appellant's submission, US – Customs Bond Directive , paras. 111 and 112).  
288See also Thailand's appellant's submission, US – Shrimp (Thailand) , para. 117. 
289Tariff Act, supra , footnote 53, Section 1673e(a)(3).  See also United States Regulations, 
Section 351.211(a).    WT/DS343/AB/R 
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242. Therefore, we do not consider it necessary to rule on the merits of the appeals by Thailand 
and India concerning the cash deposits.  We do not sh are the reasoning of the Panel on this issue and 
declare of no legal effect the interpretation devel oped by the Panel that the cash deposits required 
under United States law following the imposition of an anti-dumping duty order are not anti-dumping duties governed by Article 9 of the Anti-Dumping Agreement .
290 
C. Conclusion 
243. In the light of all these considerations, we uphold  the Panel's findings, in paragraph 7.130 of 
the Panel Report in US – Shrimp (Thailand)  and paragraph 7.107 of  the Panel Report in US – Customs 
Bond Directive , that the application of the EBR fall s within the temporal scope of the Ad Note, in the 
sense that the Ad Note authorizes the imposition of security requirements during the period following 
the imposition of a United States anti-dumping duty order. 
VI. The Reasonableness of the EBR, as Applied to Subject Shrimp 
244. We now turn to the issue of whether the Panel erred in its analysis of the "reasonableness" of 
the application of the EBR to subject shrimp.291 
245. Having found that the application of the EBR falls within the temporal scope of the 
Ad Note 292, the Panel examined whether the applica tion of the EBR to subject shrimp is a 
"reasonable" security within the meaning of the Ad Note.  The Panel began its analysis by recalling 
                                                      
290See Panel Report, US – Shrimp (Thailand) , paras. 7.111-7.122;  and Panel Report, US – Customs 
Bond Directive , paras. 7.96-7.106.  As regards the cash deposits collected under the United States' retrospective 
duty assessment system, we recall that, in US – Zeroing (EC) , the Appellate Body stated that "the margin of 
dumping established for an exporter or foreign producer operates as a ceiling  for the total amount of anti-
dumping duties that can be levied on the import entries of the subject product (from an exporter) covered by the 
duty assessment proceeding." (Appellate Body Report, US – Zeroing (EC) , para. 130 (original emphasis))  See 
also, Appellate Body Report, US – Stainless Steel (Mexico) , para. 102;  and Appellate Body Report, US – 
Zeroing (Japan) , para. 162.  Under the retrospective duty assessment system applied by the United States, it 
may happen that an advance payment for an anti-dumping duty in the form of a cash deposit equivalent to the margin of dumping determined for an exporter in an or iginal investigation in accordance with Article 2 of the 
Anti-Dumping Agreement , and imposed "at the full margin or less" in an anti-dumping duty order subject to 
Article 9.1, or calculated in the most recent assessmen t review subject to the requ irements of Article 9.3, 
exceeds the magnitude of final liability ultimately assessed in an assessment review.  If an advance payment for 
an anti-dumping duty in the form of a cash deposit at the level of the margin established for an exporter in the 
anti-dumping duty order or the most  recent assessment review exceeds the amount of anti-dumping duty liability 
finally assessed, no WTO-inconsistency arises provided th at a refund is made in acco rdance with Article 9.3.1. 
If no assessment review is requested, the USDOC assesses final anti-dumping liability at the level of the most recently calculated cash deposit rate. Furthermore, if fi nal liability exceeds the cash deposit, the difference in 
lawfully owed duties may be collected. 
291Panel Report, US – Shrimp (Thailand) , para. 7.150;  Panel Report, US –  Customs Bond Directive , 
para. 7.128. 
292Panel Report, US – Shrimp (Thailand) , paras. 7.130 and 7.137;  Panel Report, US – Customs Bond 
Directive , paras. 7.107 and 7.114. WT/DS343/AB/R 
WT/DS345/AB/R Page 94 
 
 
that the EBR is applied in conjunction with cash de posits and that, while the cash deposits secure the 
duty liability resulting from the anti-dumping duty orde r (or the most recent assessment review), the 
EBR secures the additional liability resulting from in creases in the rate of dumping over and above 
the rates established in the order (or most recent assessment review).
293  The Panel then referred to the 
ordinary meaning of the term "reasonable" and noted that reasonableness may be defined as "not irrational or absurd" and, regarding amount of secur ity, as "not greatly less or more than might be 
thought likely or appropriate".
294  Following these definitions, the Pa nel considered that there would 
be an appropriate basis for applying an incr eased security such as the EBR if it was properly 
determined that the rates of dumping establishe d in the anti-dumping duty order were likely to 
increase to the effect that the cash deposits w ould not provide sufficient security for the final 
liability.295  The Panel added that the likely amount of su ch increase in liability would also need to be 
determined in order to ensure that the amount  of the additional security requirement is not 
substantially more than the amount by which the fi nal liability would be likely to exceed the liability 
secured by the cash deposits.  According to the Panel,  without such an analysis of the increase in the 
rate of dumping, the rate in the anti-dumping duty order remains the best and only available baseline 
proxy of duties that may be ultimately assessed, and security exceeding that rate would not be 
"reasonable" within the meaning of the Ad Note.296   
246. The Panel also held that, "[i]n the context of th e application of the EBR, there is no additional 
obligation under the Ad Note to assess the risk of default of individual importers."297  For the Panel, 
"[t]here is nothing in the Ad Note to suggest th at security may only be re quired if it is further 
established that importers would not otherw ise pay the relevant anti-dumping duties."298  The Panel 
added, however, that a WTO Member could nevert heless decide to impose security requirements 
under the Ad Note only in respect of importers with a greater risk of default.299 
                                                      
293Panel Report, US – Shrimp (Thailand) , para. 7.140;  Panel Report, US – Customs Bond Directive , 
para. 7.117. 
294Panel Report, US – Shrimp (Thailand) , para. 7.141;  Panel Report, US – Customs Bond Directive , 
para. 7.118. 
295Panel Report, US – Shrimp (Thailand) , para. 7.141;  Panel Report, US – Customs Bond Directive , 
para. 7.118. 
296Panel Report, US – Shrimp (Thailand) , para. 7.141;  Panel Report, US – Customs Bond Directive , 
para. 7.118. 
297Panel Report, US – Shrimp (Thailand) , footnote 184 to paragraph 7.142;  Panel Report US – 
Customs Bond Directive , footnote 148 to paragraph 7.119. 
298Panel Report, US – Shrimp (Thailand) , footnote 184 to para. 7.142;  Panel Report, US – Customs 
Bond Directive , footnote 148 to para. 7.119. 
299Panel Report, US – Shrimp (Thailand) , footnote 184 to para. 7.142;  Panel Report, US – Customs 
Bond Directive , footnote 148 to para. 7.119.  WT/DS343/AB/R 
 WT/DS345/AB/R 
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247. The Panel then analyzed whether the United St ates properly determined that the rates of 
dumping established in the anti-dumping duty order pe rtaining to subject shrimp were likely to 
increase.  The Panel noted that the analysis conduc ted by United States Customs in this regard was 
based mainly on historical data with respect to  agriculture and aquaculture sectors as a whole 
according to which the rates increased 33 per cent of the time, did not change 11 per cent of the time, 
and decreased 56 per cent of the time.300  While regretting the absence of documentary evidence that 
would have allowed a rigorous analysis of these fi gures, the Panel considered that, in any event, 
United States Customs could not properly conclude "that rates of dumping for subject shrimp were 
likely to increase on the basis of a finding that, hi storically, rates only increased in one third of 
agriculture/aquaculture cases generally."301  The Panel added that "the United States has provided no 
explanation as to how any alleged histori cal trend in respect of dumping rates for 
agriculture/aquaculture cases generally might justif y conclusions regarding the likelihood of dumping 
rates for subject shrimp specifically."302  Recalling that the EBR is applied on all imports of subject 
shrimp, the Panel expressed the view that the historical data on which United States Customs relied were not sufficient to demonstrate that all rates in respect of all imports of subject shrimp were likely 
to increase.
303 
248. The Panel examined the United States' contenti on that the USDOC's preliminary results from 
the first administrative review of the anti-dumping dut y order with respect to subject shrimp indicated 
that several companies covered by the order were subject to an assessment rate that was higher—in certain cases, substantially higher—than the rate of the cash deposit established in the investigation.
304   
                                                      
300Panel Report, US – Shrimp (Thailand) , para. 7.143 (referring to United States' first written 
submission to the Panel in US – Shrimp (Thailand) , footnote 28 to para. 26);  Panel Report, US – Customs Bond 
Directive , para. 7.120 (referring to United States' first written submission to the Panel in US – Customs Bond 
Directive , footnote 29 to para. 27). 
301Panel Report, US – Shrimp (Thailand) , para. 7.145;  Panel Report, US – Customs Bond Directive , 
para. 7.122.  
302Panel Report, US – Shrimp (Thailand) , para. 7.145;  Panel Report, US – Customs Bond Directive , 
para. 7.122. 
303Panel Report, US – Shrimp (Thailand) , para. 7.145;  Panel Report, US – Customs Bond Directive , 
para. 7.122. 
304Panel Report, US – Shrimp (Thailand) , para. 7.146.  According to th e United States, "several Thai 
companies that had been making cash deposits at the 6% rate established in the investigation may be subject to 
an assessment rate in excess of 57%." ( Ibid., (quoting United States' first written submission to the Panel in US 
– Shrimp (Thailand) , para. 26))  Also, according to the United Stat es, the "USDOC's prelim inary results suggest 
higher assessment rates for 63 of 70 Indian companies subject to the original order", and "17 of these 
companies, which had been making cash deposits at the 10.17% rate established in the investigation, may be 
subject to an assessment rate in  excess of 82%." (Panel Report, US – Customs Bond Directive , para. 7.123 
(quoting Certain Frozen Warmwater Shrimp from Indi a: Preliminary Results an d Partial Rescission of 
Antidumping Duty Administrative Review, United States Federal Register , Vol. 72 (9 March 2007) 10658 
(Exhibit US-6 submitted by the United States to the Panel), at 10667-10668)) WT/DS343/AB/R 
WT/DS345/AB/R Page 96 
 
 
Before the Panel, the United States argued that this  supports its conclusion that rates of dumping for 
subject shrimp would likely increase.  The Panel reje cted this argument because it considered that the 
preliminary results of the first administrative revi ew of the shrimp anti-dumping duty order were not 
relevant to its analysis as they were issued af ter the EBR was imposed on shrimp and, therefore, 
would constitute an ex post facto  rationalization.
305  The Panel added that, even if these results were 
relevant, they would not favour the position of the United States as the rate s increased for only a very 
small proportion of shrimp imports from Thailand and India.306 
249. For these reasons, the Panel concluded that th e United States could no t properly ha ve found, 
on the basis of the evidence relied on by the United St ates at the time it applied the EBR, that the rates 
of dumping established in the subject shrimp order were likely to increase.  Accordingly, the Panel 
concluded that the additional security requirements resulting from the application of the EBR are not 
"reasonable" within the meaning of the Ad Note.307 
250. The United States appeals this conclusion of the Panel.  The United States explains that the 
EBR was developed in order to increase the secur ity requirements on merchandise with a higher risk 
of default, and that United States Customs applie d the EBR to subject shrimp because the potential 
unsecured liability appeared significant (due to the fact that shipments in excess of US$2.5 billion 
were subject to the anti-dumping duty orders), as di d the risk of default (because the industry shared 
characteristics similar to t hose of other industries that in the past had been the source of substantial 
defaults).308  The United States argues that, in finding that additional security may be "reasonable" 
only if a WTO Member determines that the anti-du mping rate is "likely" to increase between the 
imposition of the order and the fi nal assessment, the Panel relied on  an incorrect standard which 
would exclude bonding where there is less than "subs tantial certainty" that such an increase will 
occur.309  The United States points out that United Stat es Customs' analysis concerning the need for 
additional security for subject shrimp is in line w ith ordinary customs practice, as additional security 
under the EBR is related to the amount of potential liability being secured and the likelihood of 
default.  The United States contends that the Pane l's erroneous standard of  "substantial certainty" in
                                                      
305Panel Report, US – Shrimp (Thailand) , para. 7.147.  See also Panel Report, US – Customs Bond 
Directive , para. 7.125.   
306Ibid.  See also Panel Report, US – Customs Bond Directive , para. 7.125.   
307Panel Report, US – Shrimp (Thailand) , para. 7.150;  Panel Report, US – Customs Bond Directive , 
para. 7.128. 
308United States' other appellant's submissions, US – Shrimp (Thailand) , US – Customs Bond Directive , 
para. 4. 
309Ibid., para. 11.  WT/DS343/AB/R 
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rate increase requires information that is impossibl e to know at the time the security is imposed.310  
According to the United States, in assessing the reas onableness of the EBR as applied to subject 
shrimp, the Panel had to consider both the likeli hood of default and the amount of potential unsecured 
liability.311  For the United States, if the risk of defa ult was "significant", the security requirements 
would be reasonable even if the likelihood of an increase in the margin of dumping was less than 
substantial certainty.312 
251. In response to the United States' appeal, Thailand contends that the United States 
misunderstands or misrepresents the st andard actually applied by the Panel.313  For Thailand, the 
Panel's standard is that there should be a "like lihood" that margins of dumping would increase and 
that additional security should be required only up to  the "likely amount" of such increase.  Thailand 
considers that this standard is consistent with the ordinary meaning of the term "reasonable".  
Thailand adds that the Panel was correct in not  basing its standard of reasonableness on an 
indeterminate amount of "possible" liability, becau se such an approach woul d mean that the United 
States would always be permitted to require additional security of an indeterminate amount.  For Thailand, the disciplines of the Anti-Dumping Agreement  and Article VI of the GATT 1994 would be 
undermined if the expansive interpretation of "r easonable" proposed by the United States were 
endorsed.
314  Thailand rejects the United States' argumen t that the Panel's standard unduly limits 
security to a calculation based on information impossi ble to know at the time security is imposed.315  
Thailand also emphasizes that the risk of default cannot justify the imposition of security in excess of 
the amount of likely anti-dumping duty liability.  Thailand agrees with the Panel that general, 
unsubstantiated historical trends in margins of dumping in agriculture and aquaculture cases cannot 
justify the conclusion that dumping margins were likely to increase in the case of subject shrimp.316   
252. In response to the United States' appeal, India argues that the evidence submitted to the Panel 
by the United States was inadequate to support its po sition that, at the time of the imposition of the 
EBR, it could be said that the margins of dumping we re likely to rise in the case of subject shrimp.  
For India, the most important factor for determini ng reasonableness is whether the rates are likely to 
increase and, if so, the likely amount of such increases ;  and, in the absence of a proper determination 
of these two elements, security is not permissible regardless of the total value of imports and the 
                                                      
310United States' other appellant's submissions, US – Shrimp (Thailand) , US – Customs Bond Directive , 
para. 17. 
311Ibid., para. 19. 
312Ibid., para. 14.  
313Thailand's appellee's submission, US – Shrimp (Thailand) , para. 17. 
314Ibid., paras. 23-25. 
315Ibid., para. 29. 
316Ibid., para. 40. WT/DS343/AB/R 
WT/DS345/AB/R Page 98 
 
 
potential for importers to default.  In India's view , the United States' approach implies that the United 
States could impose security requirements simply on th e basis that the value of the imports is high and 
the structure of the import industry is suspect, even  if there is no likelihood of increase in dumping 
margins.
317  India adds that the test of reasonableness should be applied at a company-specific level 
and that, therefore, the analysis of likely incr ease in margins of dumping should be on an exporter-
specific basis.  India agrees with  the Panel that the evidence to s upport likely rate increases should be 
specific to subject shrimp, and cannot be based on gene ralized historical trends pertaining to the wider 
agriculture and aquaculture cases.318  India submits that the Panel never stated that its interpretation of 
"likely" increase in dumping margins mean t "substantial certainty" of such increase.319   
253. Thailand and India do not challenge on appeal the Panel's ultimate finding that the EBR, as 
applied to subject shrimp, is not a "reasonable" security.  They do, however, contest one specific 
aspect of the Panel's reasoning.  According to Thaila nd and India, the Panel erred in stating that "[i]n 
the context of the application of the EBR, there is  no additional obligation under the Ad Note to assess 
the risk of default of individual importers".320  Thailand considers that any assessment of whether a 
security requirement is reasonable must take acc ount of not only the likelihood and magnitude of 
increases in the margins of dumping, but also th e likelihood of default by individual importers.321  
India cautions that, as an estimation of the likely increase in the liability fo r anti-dumping duties may 
be based on "conjecture and guess work", it is necessa ry to add a requirement regarding the likelihood 
of default by individual importers.322   
254. In response to the position of Thailand and India on  this point, the United States contends that 
the text of the Ad Note does not suggest that "reasonableness" requires an importer-specific 
assessment of default risk.  The United States points out that assessing the risk of default of individual importers involves practical difficulties, as Unite d States Customs cannot conduct an assessment of 
individual risk without collecting all relevant in formation from the importer and cannot wait until the 
importer defaults.
323 
                                                      
317India's appellee's submission,  US – Customs Bond Directive , para. 39. 
318Ibid., para. 48. 
319Ibid., para. 49. 
320Panel Report, US – Shrimp (Thailand) , footnote 184 to para. 7.142.  See also Panel Report, US – 
Customs Bond Directive , footnote 148 to para. 7.119. 
321Thailand appellant's submission, US – Shrimp (Thailand) , paras. 150 and 151. 
322India's appellant's submission, US – Customs Bond Directive , para. 135. 
323United States' appellee's submissions, US – Shrimp (Thailand) , para. 51 and US – Customs Bond 
Directive , para. 49.  WT/DS343/AB/R 
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255. In our analysis of the Panel's finding on the "reasonableness" of the EBR under the Ad Note, 
we first discuss the general considerations to be kept in view to assess the reasonableness of a security 
requirement such as the EBR.  We then examine wh ether the EBR, as applied to subject shrimp, is a 
"reasonable security" within the meaning of the Ad Note.   
A. The Assessment of Reasonab leness under the Ad Note 
256. It is not in dispute that the EBR operates in  conjunction with cash deposits and the basic 
bond, and that the EBR is applied to secure potentia l additional liability that might arise from likely 
increases in the margin of dumping over and abov e that established for an exporter in the anti-
dumping duty order or the most recent asse ssment review.  The EBR is applied to all importers who 
import subject shrimp from certain countries.  We recall that, under the United States' retrospective 
duty assessment system, whether such an additional liability has arisen or not will be known with 
certainty only when the final lia bility for payment of anti-dumping duties is assessed in an assessment 
review and the entries of subject merchandise are liquidated.  If no assessment is requested, the entries are liquidated at the previous cash deposit rate, in which case, there would be no additional liability 
over and above the cash deposits.  The assessment ma y also result in the margin of dumping for an 
exporter (the going-forward cash depos it rate) being lower than the previously estimated cash deposit 
rate.  Furthermore, even where there is an increase in the margin of dumping for an exporter, the duty 
assessment rates for particular importers might be lower than the margin for the exporter from whom 
the importer is importing the merchandise, and, to that extent, the cash deposits would have to be 
refunded to such importers.  Thus, additional lia bility over and above the cash deposit rates may not 
arise at all or may arise in respect of only some importers. 
257. The United States has explained that, "as in th e other cases in customs administration", the 
EBR is a "security" measure that seeks to ensure the full collection of the final anti-dumping duties 
that may be assessed in an assessment review.  Th erefore, whether United States Customs requires 
additional security depends on "the amount  of potential [additional] lia bility being secured and the 
likelihood of default" by importers.
324  According to the United States, the amount of potential 
additional liability depends on "the  likelihood of an increase in the margin of dumping during the 
assessment review, the likely size of that increase, and the total value of shipments subject to that
                                                      
324United States' other appellant's submissions, US – Shrimp (Thailand) , US – Customs Bond Directive , 
para. 10. (emphasis added) WT/DS343/AB/R 
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margin of dumping."
325  As regards the "likelihood of default" by importers, a range of factors may be 
relevant to establish non-collection risk, includin g "industry characteristics, ability to pay, and 
compliance history".326  
258. In our view, a two-step approach is necessary to assess the "reasonableness" of a security such 
as the EBR.  The first step involves a determination of  the "likelihood" of an increase in the margin of 
dumping of an exporter as a result of which there will be a significant  additional liability  to be 
secured.  This determination should have a rationa l basis and be supported by sufficient evidence.  
The second step involves a determination of the "lik elihood of default" on the part of importers in 
respect of whom such additional liability is likely to  arise.  It is evident that the second step of the 
process would become pertinent only if the likelihood  of increase in the margin of dumping has been 
properly established under the first step.  If the determination of the likelihood of significant 
additional liability itself lacks a sufficient evidentia ry foundation, the imposition of a security cannot 
be justified.  Furthermore, should the determination of likelihood unde r the first step be properly made 
and thereby the second step of the process become rele vant, an evaluation of the reasonableness of the 
amount of security demanded would depend on the ma gnitude of the likely additional liability and the 
risk of default by importers.  A security must obviously reflect and be commensurate with the likely 
magnitude of the non-payment or non-collection risk  that has been established on a proper basis.  
Taking security from an importer who may have no additional liability to pay or from an importer 
who presents no risk of default, as revealed by ava ilable and pertinent evidence, would obviously be 
unreasonable.  Finally, security requirements that impose excessive additional costs on the importers 
may convert the security into an impermissible specific action against dumping.  
259. In the light of these considerations, we agree w ith the Panel that additional security could be 
taken only:   
… if a Member properly determined that the rates of dumping 
provided for in the anti-dumping order were likely to increase (such that the cash deposits provided for in the anti-dumping order would not provide sufficient security for the relevant case of suspected 
dumping).
327 (footnote omitted)  
                                                      
325United States' other appellant's submissions, US – Shrimp (Thailand) , para. 10 (referring to Panel 
Report, US – Shrimp (Thailand) , para. 6.69) and US – Customs Bond Directive , para. 10 (referring to Panel 
Report, US – Customs Bond Directive , para. 6.34). 
326Ibid. 
327Panel Report, US – Shrimp (Thailand) , para. 7.141;  Panel Report, US – Customs Bond Directive , 
para. 7.118.  WT/DS343/AB/R 
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The Member would also need to determine the likely amount  of the additional liability arising from 
such increase in order to ensure that the amount of  the security requirement is commensurate with that 
additional liability. 
260. We also agree with the Panel that "it would not be reasonable to require additional security 
simply because of the possibility of rates of dumping increasing"328, since, in our view, a mere 
possibility is not sufficient to establish likelihood of increase.  We also concur with the Panel that: 
... the possibility of rates increasing beyond a reasonable level of 
security, and importers defaulting on that excess, is a risk inherent in the retrospective system.  The Ad  Note does not allow Members to 
seek to eliminate that risk through the application of unreasonably excessive security requirements.
329 
261. We do not agree with the argument of the Un ited States that the Panel has introduced the 
standard of "substantial certainty" with respect to the likely increase in the rate of dumping.  The 
Panel has recognized the fact that, in a retrosp ective duty assessment system, the final liability for 
payment of anti-dumping duty is de termined only in an assessment review.  However, since the 
purpose of the security is to protect against add itional liability over and above the rate previously 
established, the Panel reasoned that there must be a proper determination that the margins of dumping 
were "likely to increase".330  We therefore see no error in this aspect of the Panel's analysis of the 
matter. 
262. Thailand and India have appealed against the stat ement of the Panel that, "[i]n the context of 
the application of the EBR, there is no additional obligation under the Ad  Note to assess the risk of 
default of individual importers."331  The United States does not dispute that the likelihood of risk of 
default is a crucial factor in applying the EBR.  Indeed, "ability to pay" and "compliance history" are
                                                      
328Panel Report, US – Shrimp (Thailand) , footnote 182 to para. 7.141;  Panel Report, US – Customs 
Bond Directive , footnote 146 to para. 7.118. 
329Ibid. 
330Panel Report, US – Shrimp (Thailand) , para. 7.141;  Panel Report, US – Customs Bond Directive , 
para. 7.118. 
331Panel Report, US – Shrimp (Thailand) , footnote 184 to para. 7.142;  Panel Report, US – Customs 
Bond Directive , footnote 148 to para. 7.119. WT/DS343/AB/R 
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factors taken into account by United Stat es Customs in assessing risk of default.
332 But the United 
States does not agree that an importer-specific assessment of risk of default is required.333  The United 
States has also drawn attention to the practi cal difficulties involved in such an assessment.334 
263. As we noted above, in the two-step approach  to assess the reasonableness of a security such 
as the EBR, the second step of the process involves an evaluation of the risk of default by the 
importers concerned.  The fact that significant additional liability may arise does not in itself  establish that there is a risk of default with respect to that liability.  The financial condition and 
creditworthiness of the importer (ability to pay) and its track-record of payment (history of 
compliance) are important factors in the analysis of risk of default.  In fact, the October 2006 Notice 
of the Amended CBD has opened the possibility of importer-specific bond amounts being determined 
under the EBR.  We disagree with the Panel to the exte nt that the Panel suggests that risk of default of 
individual importers need not be assessed.  Rather, we  believe that the risk of default of individual 
importers is an important factor in an analysis of the reasonableness of a security.
335  We therefore 
reverse  the legal interpretation made by the Panel, in  footnote 184 to paragraph 7.142 of the Panel 
Report in US – Shrimp (Thailand)  and footnote 148 to paragraph 7.119 of the Panel Report in US – 
Customs Bond Directive , that, in the context of the application of the EBR, there is no obligation 
under the Ad Note to assess the risk of default by individual importers.   
B. The Reasonableness of the EBR, as  Applied to Subject Shrimp 
264. The decision of United States Customs to apply the EBR to subject shrimp was mainly based 
on the following elements, namely, that:  (i) in ag riculture and aquaculture sectors, the margin of 
dumping increased in about one third of cases, and such increase was significant;  (ii) importers of 
agriculture and aquaculture merchandise were the source of the bulk of defaults on the payment of 
anti-dumping duties;  and (iii) the potential additio nal liability was significant because of the heavy 
volume of shipments subject to the anti-dumping duty orders. 
                                                      
332United States' other appellant's submissions, US – Shrimp (Thailand) , US – Customs Bond Directive , 
para. 10.   
333See United States' appellee's submissions, US – Shrimp (Thailand) , para. 51 and US – Customs Bond 
Directive , para. 49. 
334United States' other appellant's submissions, US – Shrimp (Thailand) , US – Customs Bond Directive , 
para. 17.  
335Having said this, we do not express a view on the proper methodology to assess the default risk of 
importers, and in particular, on whether this could be done based on information from individual importers or on 
the basis of adequately reasoned inferences from a representative sample of importers of the subject 
merchandise or from other pertinent factors.  WT/DS343/AB/R 
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265. As we explained above, the application of a se curity such as the EBR cannot be viewed as 
reasonable unless, at the time it is applied, a likeli hood of an increase in the margin of dumping of an 
exporter resulting in significant additional liabilit y has been properly determined on a sufficient 
evidentiary foundation.  We believe that an anal ysis showing that margins of dumping had increased 
in 38 per cent of cases, in the agriculture and a quaculture sectors as a whole, is not a sufficient 
evidentiary basis to conclude that margins of dumping were likely to increase for subject shrimp.  
Moreover, the cases in which an increase of the ma rgin of dumping was allegedly found did not 
include subject shrimp.336  In this respect, we also note th e Panel's statement that "India ha[d] 
demonstrated—and the United States ha[d] not dis puted—that rates increased for a very small 
proportion of shrimp imports from India."337 
266. Moreover, we note that, in requiring security in an amount equivalent to the dumping margin 
multiplied by the value of imports in the preceding 12 months, the EBR assumes that the final liability 
for payment of anti-dumping duties will virtually doub le in each assessment re view compared to the 
previously established margin.  We see no credible b asis for this assumption underlying the EBR.  We 
further note that the EBR does not take into account th e fact that, if there is an increase in the going-
forward cash deposit rate in an as sessment review with respect to an exporter, that revised cash 
deposit rate would capture the increase in the dut y liability up to that level for all importers 
purchasing from that exporter.   
267. In our view, a "significant potential unsecured liability"338 in respect of subject shrimp can 
arise only if there is a significant increase in the ma rgin of dumping of an exporter as compared to the 
margin of dumping established in the original invest igation or the most recent assessment review.  We 
do not see how the total value of subject shrimp sh ipments (US$2.5 billion, according to the United 
States) is, in and of itself, a relevant factor fo r determining whether there is significant additional
                                                      
336We note from Exhibit US-19 submitted by the United States to the Panel that, in arriving at the 
figure of 38 per cent, 888 anti-dumping cases in the agriculture and aquaculture sectors were examined in which 
anti-dumping duty rates had increased in 338 cases.  Of  the 338 cases, one item alone, namely, cut flowers, 
accounted for 263 cases.  The next two highest items acc ounting for the increase in  anti-dumping duty rates 
were crawfish (34 cases) and mushrooms (19 cases).  Taken together, a few other items, like fresh Atlantic 
salmon and honey, accounted for the remaining 22 cases of increases in anti-dumping duty rates.  As far as the 
aquaculture sector is concerned, there were only three items, namely, crawfish (34 cases), fresh Atlantic salmon 
(8 cases), and frozen fish fillets (1 case) of the 338 cases in which the anti-dumping duty rates had increased. 
(See Panel Report, US – Shrimp (Thailand) , para. 7.143;  and Panel Report, US – Customs Bond Directive , 
para. 7.120) 
337Panel Report, US – Customs Bond Directive , para. 7.125.  See also Panel Report, US – Shrimp 
(Thailand) , para. 7.147 for a similar statement in resp ect of shrimp imports from Thailand.   
338See the United States' arguments referre d to by the Panel in Panel Report, US – Shrimp (Thailand) , 
para. 7.185 and Panel Report, US – Customs Bond Directive , para. 7.306. WT/DS343/AB/R 
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liability, unless there is a signifi cant increase in the margin of dumpi ng of an exporter as well, because 
the cash deposits capture the liabilit y on the total value of the shipme nts at the level of the existing 
estimated anti-dumping rates.  Furthermore, as we noted earlier
339, we agree with the Panel that risk of 
default on small increases in the future liability is i nherent in a retrospective duty assessment system.  
To a certain extent, the basic bond itself would o ffer protection against such small increases in 
liability arising over and ab ove the cash deposit rates. 
268. For all these reasons, we agree with the conclu sion of the Panel that the United States could 
not have properly found, on the basis of the evidence relied upon by it, that the margins of dumping in 
respect of subject shrimp were likely to increase.340  Since the first step of the two-step approach 
indicated by us above has not been fulfilled, we  uphold  the Panel's findings, in paragraph 7.150 of 
the Panel Report in US – Shrimp (Thailand)  and paragraph 7.128 of  the Panel Report in US – Customs 
Bond Directive , that the additional security requirement resulting from the application of the EBR to 
subject shrimp is not "reasonable" within the meaning of the Ad Note.  In reaching this conclusion, we 
have also taken into account the fact that the EBR ope rates as a third layer of protection against risk of 
default over and above the cash deposits and, to some extent, the basic bond. 
269. Therefore, the finding of the Panel that the application of the EBR to subject shrimp is 
inconsistent with Article 18.1 of the Anti-Dumping Agreement stands.341 
VII. India's Claims that the Amended CBD is "As Such" Inconsistent with Articles 1 
and 18.1 of the Anti-Dumping Agreement  and Articles 10 and 32.1 of the SCM Agreement  
270. We turn to India's claim that the Pane l erred in finding that the Amended CBD342 is not 
inconsistent "as such" with Articles 1 and 18.1 of the Anti-Dumping Agreement  and Articles 10 
and 32.1 of the SCM Agreement .  Before examining India's claim, we briefly recall the Panel's 
reasoning in rejecting India's arguments.  Having accepted the utility of the mandatory/discretionary 
distinction as an "analytical tool" for evaluating India's "as such" claims343, the Panel proceeded to 
consider whether the instruments constituting th e Amended CBD are, on their face, mandatory or 
discretionary.  Based on an examination of the texts of these instruments, the Panel preliminarily concluded that their provisions are not binding on Po rt Directors, or, more broadly, United States 
                                                     
 
339Supra , para. 260 (referring to Panel Report, US – Shrimp (Thailand) , footnote 182 to para. 7.141;  
and Panel Report, US – Customs Bond Directive , footnote 146 to para. 7.118). 
340Panel Report, US – Shrimp (Thailand) , para. 7.148;  Panel Report, US – Customs Bond Directive , 
para. 7.126. 
341Panel Report, US – Shrimp (Thailand) , paras. 7.152 and 8.1;  Panel Report, US – Customs Bond 
Directive , paras. 7.130 and 8.2(i). 
342As we explained in, supra , paras. 190 and 191, the Amended CBD refers to the legal instruments 
pursuant to which the EBR is imposed.  
343Panel Report, US – Customs Bond Directive , paras. 7.205-7.214.   WT/DS343/AB/R 
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Customs.344  In particular, the Panel noted that certain instruments of the Amended CBD—
specifically the August 2005 Clarification and the October 2006 Notice—do not  require  United 
States Customs to designate "covered cases" or "special category" merchandise subject to an anti-
dumping duty order prior to applying the E BR;  rather, these instruments only provide criteria  for 
identifying such "covered cases" or "special categor ies".  The Panel noted further that the Amended 
CBD did not "mandate WTO-inconsis tent behaviour", as, to date, United States Customs has applied 
the Amended CBD only to shrimp importers.345   
271. The Panel then addressed India's argument that the Amended CBD is "as such" WTO-
inconsistent, as it allows for impermissible speci fic action against dumping and subsidization by 
imposing the EBR in every case in which the United States concl udes that there is a likelihood of 
increase in dumping margins or the amount of subsidy.  The Panel rejected this argument by India in 
the light of its earlier finding that the imposition of security was authorized under the Ad Note during 
the period following the anti-dumping (or countervaili ng) duty order, provided it was reasonable.   
272. Relying on these findings that the Amended CBD is not a mandatory measure and that the 
EBR does not constitute impermissible acti on against dumping or subsidization in every case  when it 
is imposed, the Panel concluded th at the Amended CBD "as such" does not violate Articles 1 and 18.1 
of the Anti-Dumping Agreement  and Articles 10 and 32.1 of the SCM Agreement .346  
273. On appeal, India accepts that its "as such" clai ms on appeal "can succeed only if the Appellate 
Body agrees with India that the requiring of secur ity between the final determination and the final 
assessment review under the retrospective [duty] assessment system [of the United States] is not 
authorized by the Ad Note".347  India argues that, if the Appellate Body were to reverse the finding of 
the Panel on the temporal scope of the Ad Note, the other finding of the Panel that the Amended CBD 
is discretionary "cannot stand in the way of Indi a's 'as such' claims under Articles 1 and 18.1 of the 
Anti-Dumping Agreement ."348   
274. For its part, the United States agrees with the r easoning by the Panel in rejecting India's claim 
that the Amended CBD is "as such" incons istent with Articles 1 and 18.1 of the Anti-Dumping 
Agreement  and Articles 10 and 32.1 of the SCM Agreement .  For the United States, the central
                                                      
344Panel Report, US – Customs Bond Directive , paras. 7.216-7.220.  The Panel made specific reference 
to certain instruments in the Amended CBD that provide,  for instance, that additiona l bonds "may" be required, 
or that United States Customs "may" cal culate the bond using certain formulas. 
345Panel Report, US – Customs Bond Directive , para. 7.221.  
346Ibid., paras. 7.233-7.238.  
347India's appellant's submission,  US – Customs Bond Directive , para. 84.  
348India's appellant's submission, US – Customs Bond Directive , para. 84. WT/DS343/AB/R 
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question is whether the particular characteristics of a measure require a Member to act inconsistently 
with a given obligation in every instance.  The United States agrees with the Panel that the 
Amended CBD does not.
349   
275. As explained in Section V a bove, we have upheld the finding of the Panel that a security 
required after the imposition of an anti-dumping duty orde r in an original investigation falls within the 
temporal scope of the Ad Note.  Thus, the premise on which India's appeal rests does not stand, and 
we therefore uphold  the Panel's finding, in paragraphs 7.2 36-7.238 and 8.1 of the Panel Report in 
US – Customs Bond Directive , that the Amended CBD, by virtue of  which the EBR is imposed, is not 
inconsistent "as such" with Articles 1 and 18.1 of the Anti-Dumping Agreement  and Articles 10  
and 32.1 of the SCM Agreement . 
VIII.  India's Claims that the Amended CBD is Inconsistent with Article 9 of the Anti-
Dumping Agreement  and Article 19 of the SCM Agreement  
276. We turn to India's claim that the Panel e rred in finding that the Amended CBD is not 
inconsistent "as such" and "as applied" with  Articles 9.1, 9.2, 9.3, and 9.3.1 of the Anti-Dumping 
Agreement , and in finding that the Amended CBD is not  inconsistent "as such" with Articles 19.2, 
19.3, and 19.4 of the SCM Agreement .  Before the Panel, India argued, in the context of its 
"as applied" claims, that the Amended CBD is inconsistent with Article 9 of the Anti-Dumping 
Agreement  because it is "impermissible to demand an enhanced, continuous bond in addition to the 
duties collected in an amount equal to the dumping margin or the amount of the subsidy found to 
exist" following a final determination in the original investigation.350  In considering these claims, the 
Panel noted that, as provided for in its title, Article  9 is concerned with the "imposition and collection 
of anti-dumping duties ".351  For the Panel, a bond is not a "duty" and the term "duty" does not 
encompass bonds, because a bond does not yield public revenue at the time it is provided.352  
Accordingly, the Panel concluded that the EBR is not an anti-dumping duty and therefore falls outside 
the scope of Article 9 of the Anti-Dumping Agreement .353   
                                                      
349United States' appellee's submission, US – Customs Bond Directive , paras. 37-41 (referring to Panel 
Report, US – Customs Bond Directive , paras. 7.215-7.227). 
350Panel Report, US – Customs Bond Directive , para. 7.148 (quoting India's first written submission to 
the Panel in US – Customs Bond Directive , para. 77).  
351Ibid., para. 7.159. (original emphasis) 
352Ibid., para. 7.160. 
353Ibid., para. 7.161.  WT/DS343/AB/R 
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277. The Panel rejected India's "as such" challe nge against the Amended CBD for the same 
reasons it had rejected India's "as applied" claims.354  Furthermore, having noted that the provisions of 
Articles 19.2, 19.3, and 19.4 of the SCM Agreement  are substantively similar to those in Articles 9.1, 
9.2, 9.3, and 9.3.1 of the Anti-Dumping Agreement , the Panel concluded that  the enhanced bond is not 
a countervailing duty and that the EBR also fa lls outside the scope of Article 19 of the SCM 
Agreement .355 
278. India appeals these findings of the Panel.  For India, the Panel erred because it read into 
Article 9 of the Anti-Dumping Agreement  and Article 19 of the SCM Agreement a right to impose 
security after the imposition of an anti-dumping duty order, when the wording of these provisions and 
the specific reference in the provisions to the impos ition and collection of "duties" make it clear that 
they intend to exclude other rights such as taking additional security.356   
279. For its part, the United States agrees with the Panel that the EBR, imposed pursuant to the 
Amended CBD, is not an anti-dumping duty, and that measures other than anti-dumping duties (or countervailing duties) fall outside the scope of Article 9 of the Anti-Dumping Agreement (or 
Article 19 of the SCM Agreement ).  The United States considers that India's argument would require 
an interpretation at odds with the ordinary meaning of the terms used in these provisions, in particular, 
the term "duty".
357   
280. India's appeal raises the question of whethe r a bond is a "duty" within the meaning of 
Article 9 of the Anti-Dumping Agreement (or Article 19 of the SCM Agreement ).  A bond under the 
Amended CBD secures the payment of a duty.  A bond, by itself, is not a duty as it does not entail any 
transfer of money from the importer to the governme nt.  Therefore, the EBR imposed pursuant to the 
Amended CBD cannot be characterized as a "duty"  within the meaning of Article 9 of the 
Anti-Dumping Agreement and Article 19 of the SCM Agreement .  
281. Accordingly, we agree with the Panel that  bonds provided under the Amended CBD are not 
anti-dumping duties or countervailing duties and that, therefore, they fall outside the scope of 
Articles 9.1, 9.2, 9.3, and 9.3.1 of the Anti-Dumping Agreement , as well as Article 19.2, 19.3, 
and 19.4 of the SCM Agreement .  On this basis, we uphold  the Panel's finding, in paragraphs 7.161, 
7.263, 7.264, and 8.1 of the Panel Report in US – Customs Bond Directive , that the Amended CBD,
                                                      
354Panel Report, US – Customs Bond Directive , para. 7.263. 
355Ibid., para. 7.264.  
356India's appellant's submission, US – Customs Bond Directive , paras. 100-102. 
357United States' appellee's submission, US – Customs Bond Directive , paras. 42 and 43. WT/DS343/AB/R 
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by virtue of which the EBR is imposed, is not inco nsistent "as such" and "as applied" with Articles 
9.1, 9.2, 9.3, and 9.3.1 of the Anti-Dumping Agreement  and that it is not inconsistent "as such" with 
Articles 19.2, 19.3, and 19.4 of the SCM Agreement .
358 
IX. India's Request for Completion of the Analysis on Article 18.4 of the Anti-Dumping 
Agreement and Article 32.5 of the SCM Agreement  
282. We turn to India's request that the Appellate  Body complete the analysis and find that the 
Amended CBD is inconsistent "as such"  with Article 18.4 of the Anti-Dumping Agreement  and 
Article 32.5 of the SCM Agreement .359 
283. Before the Panel, India claimed that the Ame nded CBD is inconsistent "as such" with the 
United States' obligations under Article 18.4 of the Anti-Dumping Agreement , Article 32.5 of the SCM 
Agreement , and Article XVI:4 of the WTO Agreement .360  Relying on the Appellate Body's approach 
in US – Corrosion-Resistant Steel Sunset Review , the Panel found that it was unnecessary to make 
findings with respect to these claims because the Panel had already found that India had failed to 
establish that an "as such" violation had occurred under any specific obligation of the covered agreements.
361  The Panel therefore did not make any findings on the claims of India that the 
Amended CBD violates Article 18.4 of the Anti-Dumping Agreement , Article 32.5 of the SCM 
Agreement , and Article XVI:4 of the WTO Agreement . 
284. In the event the Appellate Body reverses the Pa nel's findings with respect to India's "as such" 
claims on appeal regarding the Amended CBD under Artic les 1, 9.1, 9.2, 9.3, 9.3.1, or 18.1 of the 
Anti-Dumping Agreement , or under Articles 10, 19.2, 19.3, or 19.4 of the SCM Agreement 362, India 
                                                      
358Panel Report, US – Customs Bond Directive , paras. 7.161, 7.263, 7.264, and 8.1. 
359Article 18.4 of the Anti-Dumping Agreement  provides:   
Each Member shall take all necessary steps, of a general or particular 
character, to ensure, not later than the date of entry into force of the WTO 
Agreement for it, the conformity of its laws, regulations and administrative 
procedures with the provisions of this  Agreement as they may apply for the 
Member in question. 
Article 32.5 of the SCM Agreement  provides: 
Each Member shall take all necessary steps, of a general or particular 
character, to ensure, not later than the date of entry into force of the WTO 
Agreement for it, the conformity of its laws, regulations and administrative 
procedures with the provisions of this  Agreement as they may apply to the 
Member in question. 
360Panel Report, US – Customs Bond Directive , para. 7.267.  
361Ibid., para. 7.271 (referring to Appellate Body Report, US – Corrosion-Resistant Steel Sunset 
Review , paras. 210 and 211, where the Appellate Body made such findings with regard to Article 18.4 of the 
Anti-Dumping Agreement and Article XVI:4 of the WTO Agreement ).  The Panel considered that the Appellate 
Body's rationale in that dispute is equally applicable to India's claim under Article 32.5 of the SCM Agreement  
in this dispute.  
362India's appellant's submission, US – Customs Bond Directive , paras. 95 and 96.    WT/DS343/AB/R 
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requests the Appellate Body to complete the analys is and find that the Amended CBD is "as such" 
inconsistent with Article 18.4 of the Anti-Dumping Agreement  and Article 32.5 of the SCM 
Agreement , respectively. 
285. As we have upheld the Panel's findings that th e Amended CBD is not inconsistent "as such" 
with Article 1, 9.1, 9.2, 9.3, 9.3.1, or 18.1 of the Anti-Dumping Agreement  or with Article 10, 19.2, 
19.3, 19.4, or 32.1 of the SCM Agreement , we find it unnecessary  to make findings with respect to the 
"as such" claims of India under Article 18.4 of the Anti-Dumping Agreement and Article 32.5 of the 
SCM Agreement .363 
X. The Panel's Terms of Reference 
286. We turn now to consider India's claim that the Panel erred in finding that Section 1623 of the 
Tariff Act and Section 113.13 of the United States Regulations were not within the scope of the 
measure at issue, and were therefore not  within the Panel's terms of reference.364   
287. Before the Panel, India claimed that, in add ition to the instruments constituting the Amended 
CBD, one statutory provision (Section 1623 th e Tariff Act) and one regulatory provision 
(Section 113.13 of the United States Regulations)—wh ich each provide the general legal authority for 
the Amended CBD365—constitute the "measure at issu e" for India's "as such" claims.  The Panel noted 
that, whilst Section 1623 the Tariff Act and Sec tion 113.13 of the United States Regulations are 
mentioned in India's panel request366, they had not been included in India's request for consultations 
with the United States;  rather, the text of Indi a's consultations request refers only to the legal 
instruments constituting the Amended CBD.367  India conceded that its consultations request did not
                                                      
363Appellate Body Report, US – Corrosion Resistant Steel Sunset Review , paras. 210 and 211. 
364Panel Report, US –  Customs Bond Directive , para. 7.196. 
365See, for instance, Panel Report,  US –  Customs Bond Directive , para. 7.193. 
366Panel Report, US –  Customs Bond Directive , para. 7.176 (quoting, in relevant part, Request for the 
Establishment of a Panel by India (WT/DS345/6): 
[India] understands that the Amended CBD was adopted pursuant to the 
laws and regulations of the United States that authorize [US Customs] to 
administer customs laws and regulations including 19 U.S.C. §1484, 19 
U.S.C. §1502, 19 U.S.C. §1505, 19 U.S.C. §1623,  and 19 U.S.C. §1673g, 
and the regulations governing the am ount and imposition of bonds codified 
at 19 C.F.R. §113.13 , 19 C.F.R. §113.40, 19 C.F. R. §113.62 and 19 C.F.R. 
§142.2. (footnote omitted;  emphasis added)) 
367Ibid., para. 7.184.  The Panel found it unnecessary to consider the actual statements made during 
consultations and confined its examination of the issu e to the content of the consultations request. (See ibid. 
para. 7.186 (referring to Appellate Body Report, US – Upland Cotton , para. 287, in turn referring to the 
approach adopted by the panel in Panel Report, Korea – Alcoholic Beverages , para. 10.19)) WT/DS343/AB/R 
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refer to any United States statutory or regulatory provisions.
368  India, however, claimed that 
Section 1623 the Tariff Act and Section 113.13 of the United States Regulations nonetheless fall 
within the Panel's terms of reference because it is the request for the establishment of a panel that 
defines a panel's mandate, and because there is no ne ed for a "precise and exact identity" between the 
measures subject to consultations and those identified in the panel request.369   
288. The Panel recalled that a pa nel's terms of reference370, referred to in Article 7 of the DSU, are 
governed by the panel request371, referred to in Article 6.2 of the DSU.  However, Article 4.4 of the 
DSU provides that a request for consultations should identify the measures at issue.  A panel's terms 
of reference will include the specific measure identif ied in the panel request, but that measure should 
have been identified in the consultations request  "to some degree that is less than 'specific'".372  
However, the required degree of specificity is not elucidated in these DSU provisions.373  The Panel 
therefore addressed the issue of whether any basis exists, in the light of Articles 4 and 6 of the DSU, 
to include Section 1623 of the Tariff Act and Section 113.13 of the United States Regulations in its terms of reference.  Relying on what it perceived to be a "standard" develo ped by the Appellate Body 
in US – Certain EC Products  for deciding whether a measure listed in a panel request but not in a 
consultations request should be incl uded in a panel's terms of refere nce, the Panel examined whether 
the two measures in question—that is, on the one  hand, the Amended CBD (mentioned in both the 
panel request and the consultations  request) and, on the other hand, Section 1623 of the Tariff Act and 
Section 113.13 of the United States Regulations (mentioned only in the panel request)—are  separate 
and  legally distinct   measures.
374   
                                                      
368Panel Report, US – Customs Bond Directive , para. 7.184. 
369Ibid., para. 7.178.   
370Ibid., para. 7.180.  The Panel referred to its own terms of reference (available at WT/DS345/7): 
We recall that the terms of reference that govern the present dispute are the 
following: "To examine, in the light of the relevant provisions of the covered 
agreements cited by India in document WT/DS345/6, the matter referred to 
the DSB by India 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." (footnote omitted) 
371Ibid., para. 7.181 (referring to Appellate Body Report, US – Upland Cotton , para. 284). 
372Ibid.   
373Ibid.  
374See Appellate Body Report, US – Certain EC Products , paras. 69 and 70.  The Panel also noted that, 
in that case, the Appellate Body evaluated one measure,  the "increased bonding requirements as of 3 March on 
the [European Communities'] listed products", against a separate measure, the "19 April action" governing the imposition of 100 per cent duties on certain designated products imported from the European Communities. 
(See Panel Report, US –  Customs Bond Directive , para. 7.183 and footnote 197 thereto (referring to Appellate 
Body Report, US – Certain EC Products , para. 60))  WT/DS343/AB/R 
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289. After analyzing the text of the two sets of instruments375, the Panel concluded that they were 
separable and legally distinct because:  they do not "provide for the same action"376;  a successful 
challenge to the statutory and regulatory provisions would limit the ability of the United States to 
impose security requirements for the collection of re venue in a wider array of circumstances than a 
successful challenge to the Amended CBD377;  and the Amended CBD is a directive whilst 
Section 1623 of the Tariff Act and Section 113.13 of the United States Regulations are statutory and regulatory provisions.  The Panel therefore found that Section 1623 of the Tariff Act and 
Section 113.13 of the United States Regulations  were not within its terms of reference.
378 
290. India requests the Appellate Body to reverse this  finding of the Panel.  India refers to the 
statement of the Appellate Body in US – Upland Cotton  that a "precise and exact" identity between 
the scope of consultations and the measures sp ecified in the panel request is not needed.379  Further, 
India seeks to distinguish the Appellate Body's approach in US – Certain EC Products  from that of 
the Panel.380  With regard to the Panel's finding that th e two sets of measures in question are separate 
and legally distinct, India claims that the Panel ove rlooked the fact that India challenged Section 1623 
of the Tariff Act and Section 113.13 of the United States Regulations only "to the extent that they authorize the EBR."
381  Further, India submits that it is undi sputed that Section 1623 of the Tariff Act 
and Section 113.13 of the United States Regulations  represent the legal authority for the EBR,  
and to the extent that India's consultations re quest concerned the WTO-consistency of the EBR, 
Section 1623 of the Tariff Act and Section 113.13 of  the United States Regulations were implicated in 
the consultations.382  In response, the United States contends that the Panel did carefully consider the 
                                                      
375With regard to the Amended CBD, the Panel noted that the July 2004 Amendment indicates that one 
of the goals of amending the bond directive is "ensuring [United States Customs'] ability to collect the 
anti-dumping and countervailing duties at liquidation and ensuring that the revenue is protected.  To accomplish this end, in particular, the instruments provide formul as to determine the amount of the EBR, establish a 
methodology for making individualized determinations of enhanced bond amounts for individual 
exporters/producers, and describe notification and publi cation requirements.  Finally, the Panel noted that the 
July 2004 Amendment, the August 2005  Clarification, and the October 20 06 Notice each expressly refers to 
Section 113.13 of the United States Regulations as constituting the laws and regulations for which United States 
Customs intends to ensure compliance. (See Panel Report, US –  Customs Bond Directive , para. 7.188 and 
footnote 205 thereto) 
The Panel noted that Section 1623 of the Tariff Act governs the conditions and form of a bond, 
cancellation of a bond, validity of a bond, and the making of deposits  in lieu  of bonds;  and that the provisions 
of Section 113.13 of the United States Regulations govern minimum bond amounts, guidelines for determining 
the bond amounts, and periodic review of bond sufficiency.  (See Panel Report, US –  Customs Bond Directive , 
para. 7.190 and footnote 207 thereto, and para. 7.192 and footnote 209 thereto) 
376Panel Report, US –  Customs Bond Directive , para. 7.193.  
377Ibid., para. 7.194.  
378Ibid., para. 7.196. 
379India's appellant's submission, US – Customs Bond Directive , para. 119 (referring to Appellate Body 
Report, US – Upland Cotton , para. 285;  and Appellate Body Report, Brazil – Aircraft , para. 132).  
380Ibid., paras. 121-124.  
381Ibid., para. 127.  
382Ibid., para. 128.  WT/DS343/AB/R 
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relationship between the two sets of instruments a nd that the existence of a general authority to 
require additional bonds does not support the view th at the two United States provisions are legally 
inseparable from the Amended CBD;  to hold othe rwise would imply that laws and regulations 
providing general authority to collect revenue would be  implicated in a dispute even if they were not 
mentioned in a consultations request.
383   
291. Before assessing the merits of India's claims, we  note India's statement at the oral hearing that 
a finding of the Appellate Body on this issue would not affect any of its substantive "as such" claims 
regarding the consistency of  the Amended CBD with a number of provisions of the Anti-Dumping 
Agreement .  India seeks a reversal of the Panel's finding on this issue for what it considers to be 
important "systemic" reasons.  We also note the st atement of the Panel that its examination of the 
scope of the consultations would be confined to wh at is contained in India's consultations request 
without reference to the actual content of the consultations, since "[w]hat takes place in ... 
consultations is not the concern of a panel."384  India has not disputed this statement of the Panel.   
292. It is well settled that the terms of reference of a panel define the scope of the dispute and that 
the claims and measures identified in the request for the establishmen t of a panel together constitute 
the matter within the panel's terms of reference under Article 7 of the DSU.  At the same time, 
Article 4.4 of the DSU provides that any request for consultations must provide " identification  of the 
measures at issue" (emphasis added).  However, as the Panel has highlighted, there is no clarification 
as to what degree the measures id entified in the panel request mu st correspond to the measures 
identified in the consultations request.   
293. The Appellate Body has recognized the important role that consultations play in defining the 
scope of a dispute.  Not only are they "a prerequisite to panel proceedings"385, they also serve the 
purpose of, inter alia , allowing parties to reach a mutually ag reed solution, and where no solution is 
reached, providing the parties an opportunity to "def ine and delimit" the scope of the dispute between 
                                                      
383See United States' appellee's submission, US – Customs Bond Directive , paras. 45 and 46. 
384See Panel Report, US –  Customs Bond Directive , para. 7.186 (quoting Appellate Body Report, US – 
Upland Cotton , para. 287, in turn quoting Panel Report, Korea – Alcoholic Beverages , para. 10.19).  This 
approach is in line with the Appellate Body's statement in US – Upland Cotton : 
Examining what took place in the cons ultations would seem contrary to 
Article 4.6 of the DSU, which provides that "[c]onsultations shall be 
confidential, and without prejudice to  the rights of any Member in any 
further proceedings."  Moreover, it would seem at odds with the requirements in Article 4.4 of the DSU that the request for consultations be 
made in writing and that it be notified to the DSB.  In addition, there is no 
public record of what actually transpires during consultations and parties will often disagree about what , precisely, wa s discussed. 
(Appellate Body Report, US – Upland Cotton , para. 287) 
385Appellate Body Report, Mexico – Corn Syrup (Article 21.5 – US) , para. 58.  WT/DS343/AB/R 
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them.386  Further, "Articles 4 and 6 of the DSU ... set  forth a process by which a complaining party 
must request consultations, and c onsultations must be held, before  a matter may be referred to the 
DSB for the establishment of a panel."387  The Appellate Body has also explained that " [a]s long as 
the complaining party does not expand the scope of the dispute , [it would] hesitate to impose too rigid 
a standard for the 'precise and exact identity' betw een the scope of the consultations and the request 
for the establishment of a panel, as this would subs titute the request for consultations for the panel 
request".388  The Appellate Body has also held that a "precise and exact identity" of measures between 
the two requests is not necessary, "provided that the 'essence' of the challenged measures had not 
changed."389  In our view, whether a complaining party has "expand[ed] the scope of the dispute" or 
changed the "essence" of the dispute through the inclus ion of a measure in its panel request that was 
not part of its consultations request mu st be determined on a case-by-case basis. 
294. In the circumstances of this case, the Panel, in accordance with the gui dance provided by the 
Appellate Body referred to above, was required to compare the respective parameters of the 
consultations request and the panel request to determine whether an e xpansion of the scope or change 
in the essence of the dispute occurred through the addition of instruments in the panel request that 
were not identified in the consultations request.  On  our own reading of India's consultations request, 
it is clear to us that the focus of India's cont ention was on the instruments constituting the Amended 
CBD, and not on the legal provisions that provi de the general authority for them, namely, 
Section 1623 of the Tariff Act and Section 113.13 of the United States Regulations.  India argues that the Panel failed to appreciate that it was ch allenging Section 1623 of the Tariff Act and 
Section 113.13 of the United States Regulations only "to the extent that they authorize" the EBR.  
India, however, does not support this claim either by reference to the consultations request or by 
reference to the arguments made by India before the Panel.  Furthermore, the argument of India 
implies that the mere fact that the consultations request includes a claim against the WTO-consistency 
of the EBR automatically means that the lega l source of the EBR is thereby implicated.
390  A  
responding Member would not be in a position to an ticipate reasonably the scope of a dispute if, by
                                                      
386Appellate Body Report, Mexico – Corn Syrup (Article 21.5 – US) , para. 54.  
387Appellate Body Report, Brazil – Aircraft , para. 131.  
388Appellate Body Report, US – Upland Cotton , para. 293. (emphasis added;  footnote omitted)   
389Appellate Body Report, Mexico – Anti-Dumping Measures on Rice , para. 137 (referring to Appellate 
Body Report, Brazil – Aircraft , para. 132).   
390As the United States suggests, such an approach would imply that laws and regulations providing 
general authority—including constitutional provisions—would automatically be implicated in a dispute even if 
they were not mentioned in a consultations request. (See United States' appellee's submission, US – Customs 
Bond Directive , para. 46) WT/DS343/AB/R 
WT/DS345/AB/R Page 114 
 
 
reason only of the inclusion of a specific measure in a consultations request, any legal instrument 
providing a general authority or legal basis for the sp ecific measure would be deemed to be part of a 
panel's terms of reference.  We are therefore not pe rsuaded by the arguments of India in this regard. 
295. India also challenges the Panel's reliance on the Appellate Body Report in US – Certain EC 
Products .  The Appellate Body, in that case, merely tr eated the absence of an explicit reference to a 
measure in the consultations request as  one  factor for excluding that measure from the panel's terms 
of reference;  it thereafter proceeded to consider  whether the relevant measures in question were 
separate and legally distinct.
391  We do not see an error in the Panel' s approach in this case.  The Panel  
assessed the differing scope, as well as the legal bases, of the two sets of instruments and came to the conclusion that they were separate and legally dist inct.  In our view, this conclusion of the Panel 
supports the view that the scope of the dispute woul d have been expanded by the inclusion of Section 
1623 of the Tariff Act and Section 113.13 of the United States Regulations in its terms of reference.    
296. For these reasons, we  uphold  the Panel's finding, in paragr aph 7.196 of the Panel Report in 
US – Customs Bond Directive , that Section 1623 of the Tariff Act and Section 113.13 of the United 
States Regulations did not fall within the scope of  the measure at issue and, accordingly, we find that 
the Panel did not err by excluding them from its terms of reference.  
XI. Whether the Panel Made a Prima Facie  Case for the United States  
297. India argues that the Panel acted inconsistently  with the requirement under Article 11 of the 
DSU that a panel make an objective assessment of th e matter before it, because, in evaluating whether 
the application of the EBR is necessary to secu re compliance with laws and regulations under 
                                                     
 
391Indeed, when the Appellate Body subsequently considered the relationship between the consultations 
request and panel request in US – Upland Cotton , it did not appear to treat its dictum in US – Certain EC 
Products as creating an exclusive test or preced ent.  The Appellate Body stated:    
In US – Certain EC Products , the Appellate Body found that one of the 
measures challenged by the European Communities was not properly before the Panel.  The Appellate Body explained that, although the panel request 
referred to the measure, it was not possible for it to conclude "on this basis 
alone " that the measure was within the Pane l's terms of reference.  It noted 
that the European Communities' request for consultations did not refer to the 
measure and that the European Communities acknowledged that the measure was not the subject of the consultations.  In its ruling, the Appellate 
Body also emphasized that the par ticular measure was "separate" and 
"legally distinct" from another m easure challenged by the European 
Communities.  
(Appellate Body Report, US – Upland Cotton , footnote 244 to para. 285 (referring to and quoting Appellate 
Body Report, US – Certain EC Products , paras. 69-75) (original emphasis))  WT/DS343/AB/R 
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Article XX(d) of the GATT 1994392, the Panel supplemented the case of the United States by 
including certain laws and regulations that the Un ited States had not itself cited.  Specifically, India 
argues that, whereas the United States had stated that it "relied solely on"393 Section 1673e(a)(1) of the 
Tariff Act, the Panel considered that Section 16 73e(a)(1) of the Tariff Act in combination with 
Sections 1673e(b)(1) and 1673 of the Tariff Act and Sections 351.212(b)(1) and 351.211(c)(1) of the 
United States Regulations were the relevant Unite d States laws and regulations with which the EBR 
was designed to secure compliance.  India consider s that, by such an expansion of the provisions it 
found to be relevant , the Panel made a prima facie  case for the United States, in a manner inconsistent 
with previous statements of the Appellate Body.394   
298. The United States contends that it did not refe r "solely" to Section 1673e(a)(1) of the Tariff 
Act as the relevant law or regulation, but, rath er, that the Amended CBD is necessary to secure 
compliance with United States anti-dumping and count ervailing duty assessment laws, "in particular", 
Section 1673e(a)(1) of the Tariff Act governing th e assessment of anti-dumping duties, as well as 
general customs laws and regulations for payment of duties to the United States Treasury.  The United 
States also points out that India itself identified some  of the laws and regulations that the Panel relied 
on and included in its examination of the United States' defence.395   
299. Contrary to India's arguments, we recall that, before the Panel, in addition to 
Section 1673e(a)(1) of the Tariff Act which go verns the assessment of anti-dumping duties, the 
United States also cited Section 113.13(c) of the Un ited States Regulations as the laws and regulations 
with which the EBR is aimed to secure compliance.396  However, after also taking into account other 
laws and regulations cite d by India and Thailand397, the Panel considered that Section 1673e(a)(1) of 
the Tariff Act in combination with Sections  1673e(b)(1) and 1673 of the Tariff Act and 
Sections 351.212(b)(1) and 351.21 1(c)(1) of the United States Regulations represent the United 
States' obligation to collect anti-dumping duties, since each  of these provisions governs the final 
                                                      
392Article XX(d) of the GATT 1994 permits Member s to adopt or enforce measures that are, inter alia , 
necessary to secure compliance with la ws or regulations that are not inconsistent with the provisions of the 
GATT 1994.  
393India's appellant's submission in US – Customs Bond Directive , para. 149.  
394Ibid., para. 151 (referring to Appellate Body Report, US – Gambling , para. 282), para. 152 (referring 
to Appellate Body Report, Japan – Agricultural Products II , paras. 125-131), and para. 153 (referring to 
Appellate Body Report, Canada – Wheat Exports and Grain Imports , para. 191). 
395United States' appellee's submission, US – Customs Bond Directive , para. 36. 
396See Panel Report, US – Customs Bonds Directive , paras. 7.296 and 7.297.  
397India referred to Sections 1673e(a)(1), 1673e(a)(3), 1673e(b), and 1673f of the Tariff Act as the 
relevant laws and regulations that, together, identify the obligation of the United States Treasury and United 
States Customs to collect anti-du mping duties. (See Panel Report, US – Customs Bonds Directive , para. 7.298)  
Thailand referred to Sections 1673e(a)(1), 1673e(a)(3),  and 1673 of the Tariff Act and Sections 351.212(b)(1) 
and 351.211(c)(1) of the United Stat es Regulations. (See Panel Report, US – Shrimp (Thailand) , para. 7.177) WT/DS343/AB/R 
WT/DS345/AB/R Page 116 
 
 
collection of anti-dumping or countervailing duties
398, and that, therefore, all of these provisions were 
the laws and regulations with which the EBR wa s designed to secure compliance, for purposes of 
Article XX(d) of the GATT 1994.399   
300. It is well established that the party asserting the affirmative of a claim or defence bears the 
burden of establishing both the legal and factual elements of that claim or defence.400  It is also well 
accepted that a panel cannot make a  prima facie  case for a party who bears that burden.401  T h e  
Appellate Body in US – Gambling  noted that, whilst: 
… "nothing in the DSU limits the faculty of a panel freely to use 
arguments submitted by any of the parties—or to develop its own 
legal reasoning—to support its ow n findings and conclusions on the 
matter under its consideration ..."[,] … a panel enjoys such discretion 
only with respect to specific claims  that are properly before it, for 
otherwise it would be considering a ma tter not within its jurisdiction.  
Moreover, when a panel rules on a claim in the absence of evidence 
and supporting arguments, it acts incons istently with its obligations 
under Article 11 of the DSU.402 
301. Before the Panel, all of the parties—India, Th ailand, and the United States—referred to laws 
and regulations with which they considered the EBR was designed to secure compliance.  Whilst the 
United States cited Section 1673e(a)(1) of the Ta riff Act, governing the assessment of anti-dumping 
duties, as well as, more generally, Section 113.13( c) of the United States Regulations, Thailand and 
India argued that the provisions cited by the Unite d States do not exclusively govern the obligation to 
require payment of duties owed to the United States Treasury;  rather, Thailand and India referred to 
additional provisions which they a lleged constitute the laws and re gulations governing the collection 
of anti-dumping duties.403  The Panel took all of these laws and regulations cited by the parties into 
account and, on this basis, decided that the releva nt laws and regulations for considering the United 
States' defence is Section 1673e(a)(1) of the Tari ff Act in combination with Sections 1673e(b)(1) 
and 1673 of the Tariff Act and Sections 351.2 12(b)(1) and 351.211(c)(1) of the United States 
Regulations. 
                                                      
398See Panel Report, US – Customs Bonds Directive , para. 7.299. 
399Ibid., para. 7.300.  See also Panel Report, US – Shrimp (Thailand) , para. 7.179. 
400See Appellate Body Report, US – Gambling , para. 282.  See also Appellate Body Report, US – Wool 
Shirts and Blouses , p. 14, DSR 1997:I, 323, at 335.  
401See, for instance, Ap pellate Body Report, Japan – Agricultural Products II , para. 129.  
402Appellate Body Report, US – Gambling , paras. 280 and 281 (quoting Appellate Body Report, EC – 
Hormones , para. 156 (footnotes omitted);  and referring to Appellate Body Report, US – Certain EC Products , 
para. 123;  and Appellate Body Report, Chile – Price Band System , para. 173). 
403See Panel Report, US – Shrimp (Thailand) , para. 7.177;  Panel Report,  US – Customs Bond 
Directive , para. 7.298.  WT/DS343/AB/R 
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302. In our view, the Panel was free to use the ar guments made and provisions cited by all the 
parties—including Thailand and India—in order to  assess objectively which laws and regulations 
were relevant to the United States' defence.  We do not believe that, in doing so, the Panel exceeded 
its jurisdiction.   
303. We do not, therefore, consider that the Panel made a  prima facie  case for the United States 
by including certain laws and regulations other th an those specifically cited by the United States for 
assessing the Article XX(d) defence.  Consequently, we  find  that the Panel did not breach its 
obligation to make an objective assessment of  the matter under Article 11 of the DSU. 
XII. The Panel's Analysis of the Term "Necessary" in Article XX(d) of the GATT 1994 
304. The United States requests that, if the Appellate Body does not reverse the Panel's finding that 
the EBR is not a "reasonable security" within the meaning of the  Ad Note, it should reverse the Panel's 
finding that, unless a Member demonstrates that the rates established in the anti-dumping duty order "are likely to increase", an additional security requ irement cannot be considered to be "necessary" 
within the meaning of Article XX(d) of the GATT 1994.  The United States also requests the 
Appellate Body to complete the analysis and unde rtake an assessment of whether the EBR satisfies 
the requirement of the chapeau of Article XX(d).
404   
305. Since we have not reversed the Panel's finding  that the EBR was not a "reasonable" security 
within the meaning of the Ad Note, we now consider the United Stat es' appeal of whether the EBR, as 
applied to subject shrimp, is "necessary" to secure compliance with certain United States laws and 
regulations.   
306. We note, however, that India raises a threshol d question of the availability of a defence under 
Article XX(d) of the GATT 1994 to the United States.   Specifically, India argues on appeal that the 
Panel erred in proceeding to evaluate the Unite d States' defence under Article XX(d) after having 
found that (a) the EBR constitutes "specific action against dumping" within the meaning of Article 18.1 of the Anti-Dumping Agreement , and (b) the EBR, as applied, is inconsistent with the 
disciplines of the Ad Note to Article VI:2 and 3 of the GATT 1994 and Article 18.1 of the Anti-
Dumping Agreement .   
                                                     
 
404United States' other appellant's submissions, US – Shrimp (Thailand) , US – Customs Bond Directive , 
para. 25. WT/DS343/AB/R 
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307. We recall that, following India's request, the Panel addressed at the interim stage
405 the issue 
of whether the United States should be permitted  to "defend" the EBR simultaneously under the 
Ad Note and under Article XX(d) of the GATT 1994.  India had argued, first, that the Panel should 
have evaluated whether a Member must invoke footnote 24 of the Anti-Dumping Agreement406 in 
order to assert an affirmative defence under Article  XX;  and, secondly, given that the Panel had 
found that Article VI and the Ad Note and the Anti-Dumping Agreement  constitute lex specialis , the 
Panel should have refused to evaluate the defe nce of the EBR raised by the United States under 
Article XX(d) of the GATT 1994.407  The Panel rejected India's argum ents on the grounds that the text 
of Article XX does not, on its face, preclude a pa nel from considering an affirmative defence under 
Article XX where it has found a violation of a pr ovision of the GATT 1994, including Article VI 
and/or the Ad Note.  Further, the Panel considered it pr oper to analyze the United States' defence 
under Article XX(d), notwithstanding its  finding that Article VI and the Ad Note constitute 
lex specialis , since the finding regarding the applicability of the principle of  lex specialis did not 
apply to the defence under Article XX(d) but, rather, to the general GATT provisions of Articles I, II, 
X:3(a), XI, and XIII.408  The Panel therefore did not find it necessary to examine whether a Member 
must first invoke footnote 24 of the Anti-Dumping Agreement before it may assert an affirmative 
defence under Article XX(d). 
308. India appeals the Panel's decision not to address "as a threshold question" whether 
Article XX(d) remains available to justify a "sp ecific action against dumping or subsidization", and 
requests the Appellate Body to comple te the analysis in this regard.409  At the oral hearing, India did 
not argue that footnote 24 of the Anti-Dumping Agreement must first be invoked before an affirmative 
defence under Article XX(d) is asserted.  Howe ver, relying on the Appellate Body Report, US – Offset 
Act (Byrd Amendment) , India argues that, if a measure is found to be a "specific action against 
dumping", in violation of Article 18.1 of the Anti-Dumping Agreement , a defence under Article XX(d) 
is not available.  Conversely, if a measure cons titutes a general non-specific action against dumping, a 
                                                      
405India's appellant's submission, US – Customs Bond Directive , para. 139 (referring to India's request 
for interim findings (referred to in Panel Report,  US – Customs Bond Directive , at para. 6.11)).    
406Article 18.1 and its accompanying footnote 24 of the Anti-Dumping Agreement  provide:  
No specific action against dumping of exports from another Member can be 
taken except in accordance with the provisions of GATT 1994, as 
interpreted by this Agreement.[*] 
[*original footnote 24] This is not intended to preclude action under other 
relevant provisions of GATT 1994, as appropriate.  
407See Panel Report,  US – Customs Bond Directive , para. 6.11.  
408Ibid., para. 6.13.  See also ibid., paras. 7.171 and 7.172. 
409India's appellant's submission, US – Customs Bond Directive , para. 140.    WT/DS343/AB/R 
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defence under Article XX(d) is available.410  India also submits that reports of previous GATT panels 
support its view that Article XX(d) is not available to justify measures inconsistent with Article VI.411  
India contends further that Article VI of the GATT 1994, the Ad Note, and the Anti-Dumping 
Agreement  constitute a "complete, self-contained c ode" according to which anti-dumping measures 
must be applied.  Accordingly, a measure that does not comply with any of the provisions relating to Article VI of the GATT 1994 read in conjunction with the Anti-Dumping Agreement  or the SCM 
Agreement  must be held to be inconsistent with th e relevant provisions of these Agreements.  Any 
interpretation that permits Members to justify im permissible specific actions against dumping under 
Article XX(d) would render "inutile" Article 18.1 of the Anti-Dumping Agreement .
412   
309. In response, the United States submits that the Panel was correct to consider the defence of 
the United States under Article XX(d) after having f ound that the United States acted inconsistently 
with the Ad Note to GATT Article VI.  The United States questions the basis of India's argument that 
footnote 24 of the Anti-Dumping Agreement  must be specifically "invoked" to justify such a violation 
under Article XX(d).  In its view, this argument re sts on a misinterpretation of the Appellate Body 
Report in US – Offset Act (Byrd Amendment) .  Further, the United States submits that India does not 
offer an explanation of how the availability of a defence under Article XX(d) would render 
Article 18.1 of the Anti-Dumping Agreement  inutile.413 
310. India's appeal raises systemic issues about the availability of a defence under Article XX(d) to 
justify a measure found to constitute "specific action against dumping" under Article 18.1 of the Anti-
Dumping Agreement , and not to be in accordance with the Ad Note to Article VI:2 and 3 of the 
GATT 1994, as well as Article 18.1 of the Anti-Dumping Agreement .  Assuming, arguend o, that such 
a defence is available to the United States, we pro ceed to consider the United States' appeal of the 
Panel's finding that the EBR, as applied to subject shrimp, is "necessary" to secure compliance with 
certain United States laws and regulations within the meaning of Article XX(d).  We examine the 
Panel's finding on this issue of "necessity" before we return to the question of availability of a defence 
under Article XX(d). 
                                                      
410India submits that the import of the Appellate Body's statement in US – Offset Act (Byrd 
Amendment) —that, for purposes of Article 18.1 of the Anti-Dumping Agreement , a measure can be either  a 
"specific action against dumping" as referred to Article 18.1, or a general, "non-specific action" under 
footnote 24 to Article 18.1—is that the United States was required to invoke the footnote before justifying the EBR under Article XX(d). (India's appellant's submission, US – Customs Bond Directive , para. 142)  See also 
Appellate Body Report, US – Offset Act (Byrd Amendment) , paras. 260-262. 
411India's appellant's submission, US – Customs Bond Directive , para. 143 (referring to GATT Panel 
Report, EEC – Parts and Components , para. 5.17;  and GATT Panel Report, US – Canadian Pork , para. 4.4). 
412Ibid., paras. 144 and 145.  
413United States appellee's submission, US – Customs Bond Directive , para. 35. WT/DS343/AB/R 
WT/DS345/AB/R Page 120 
 
 
311. The Panel identified the two elements that must  be satisfied for a measure to be justified 
provisionally under paragraph (d) of Article XX of the GATT 1994
414:  first, the measure must be 
"designed" to secure compliance with laws and regula tions that themselves are not WTO-inconsistent;  
and, secondly, the measure must be "necessary" to sec ure compliance with those laws and regulations.  
With regard to the first element, we recall that the Panel identified the relevant  laws and regulations of 
the United States that govern the assessment and collection of an ti-dumping or countervailing duties 
and which are not themselves inconsistent  with any provisions of the GATT 1994.415  The Panel 
accepted that the EBR is "designed" to secure complia nce with them because the stated goal of the 
Amended CBD and the EBR aligns with the obj ectives underlying these laws and regulations.416    
312. The Panel then turned to the second element of  its assessment, that is , whether the EBR is 
"necessary" to ensure compliance with these laws and regulations, taking into account the United 
States' arguments that the EBR secures the potential additional liability arising from anti-dumping or 
countervailing duties owed in excess of the cash deposits.  According to the United States, the 
application of the EBR is "necessary" to secure ag ainst "significant potential unsecured liability" and 
against "significant risk of default" a ssociated with subject shrimp imports.417  Both Thailand and 
India challenged the United States' assessment that  dumping margins were likely to increase and that 
subject shrimp importers presented a heightened risk  of default in comparison to importers of other 
products subject to anti-dumping duty orders.418  In its analysis, the Panel referred to previous 
Appellate Body reports for the interpretation of the term "necessary" in the context of Article XX(d) 
and noted that, in order to be considered "necessar y", a measure does not need to be "indispensable", 
but must constitute something more than only "making a contribution to" securing compliance.419  The 
Panel also relied on factors identified by the Appe llate Body as relevant in determining whether the 
measure in question is necessary to secure comp liance with other WTO-consistent laws and 
regulations.420   
                                                      
414Panel Report, US – Shrimp (Thailand) , para. 7.173 and  Panel Report,  US – Customs Bond Directive , 
para. 7.294 (referring to Appellate Body Report, Korea – Various Measures on Beef , para. 157). 
415Panel Report, US – Shrimp (Thailand) , paras. 7.179 and 7.180;  Panel Report,  US – Customs Bond 
Directive , paras. 7.300 and 7.301.  
416Panel Report, US – Shrimp (Thailand) , paras. 7.181-7.183;  Panel Report,  US – Customs Bond 
Directive , paras. 7.302-7.304.   
417Panel Report, US – Shrimp (Thailand) , para. 7.185;  Panel Report,  US – Customs Bond Directive , 
para. 7.306. 
418Panel Report, US – Shrimp (Thailand) , para. 7.186;  Panel Report,  US – Customs Bond Directive , 
para. 7.307.   
419Panel Report, US – Shrimp (Thailand) , para. 7.188 and Panel Report,  US – Customs Bond Directive , 
para. 7.309 (referring to Appellate Body Report, Korea – Various Measures on Beef , para. 161).  
420Panel Report, US – Shrimp (Thailand) , para. 7.189 and Panel Report,  US – Customs Bond Directive , 
para. 7.310 (referring to Appellate Body Report, Korea – Various Measures on Beef , paras. 162 and 163).    WT/DS343/AB/R 
 WT/DS345/AB/R 
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313. The Panel noted that, insofar as it pertains to the relative importance of the interests being 
protected by the EBR, the assess ment and collection of anti-dumpi ng or countervailing duties carries 
significant importance, specifically in the context of efforts by the United States to enforce trade 
remedies permissible under the covere d agreements and to protect its re venue within the context of its 
retrospective duty assessment system.421  However, the Panel emphasized that the EBR is designed to 
secure specifically against the likelihood of an ti-dumping duties exceeding cash deposit rates.  
Recalling its earlier finding, in the context of its  assessment of whether the EBR was a reasonable 
security under the Ad Note, that the United States had failed to establish that rates of dumping in the 
anti-dumping duty order were likely to increase and ha d therefore failed to demonstrate that additional 
security provided by the EBR reas onably correlated to any case of suspected dumping in excess of the 
dumping of margin established in the anti-dumping dut y order, the Panel did not see the need to 
impose the EBR to secure against such an outcome.  The Panel found that the EBR, as applied to 
subject shrimp, is therefore not "necessary" w ithin the meaning of Article XX(d) of the 
GATT 1994.422 
314. The United States submits on appeal that the test used by the Panel to determine the necessity 
of the EBR under Article XX(d) was the same flawed test that it used to find that the EBR is not a 
"reasonable security" under the Ad Note.  According to the United States, that test provides "no 
insight" into whether the measure is necessary.  In li ne with the arguments adva nced by it against the 
"reasonableness" test adopted by the Panel, the United States contends that a security may be 
"necessary" where there is a "likelihood" that the liab ility will accrue, but is not "likely" (in the sense 
of substantial certainty) that this will occur.423  The United States submits that the application of the 
EBR to subject shrimp is "necessary" due to th e significant potential unsecured liability and the 
significant potential default associated with such en tries.  The United States argues that the Panel 
failed to take into account the fact that, with r espect to subject shrimp, United States Customs has 
adopted a "tailored approach" for evaluating risk and bond amounts.424  Further, the United States 
claims that neither Thailand nor India identified an y "reasonable alternatives" to the EBR that would 
address the specific problem faced by United States Customs;  nor did the Panel find that any such
                                                      
421Panel Report, US – Shrimp (Thailand) , para. 7.190;  Panel Report,  US – Customs Bond Directive , 
para. 7.311.   
422Panel Report, US – Shrimp (Thailand) , para. 7.191;  Panel Report,  US – Customs Bond Directive , 
para. 7.312.   
423United States' other appellant's submissions, US – Shrimp (Thailand) , US – Customs Bond Directive , 
para. 21.   
424Ibid., para. 22. WT/DS343/AB/R 
WT/DS345/AB/R Page 122 
 
 
alternatives exist.
425  Finally, the United States contends that the EBR meets the requirements of the 
chapeau of Article XX and requests the Appellate Body  to complete the analysis on this issue as there 
is sufficient evidence on the record to do so.426   
315. In response, Thailand highlights that the United St ates' appeal of the Panel's necessity analysis 
relies on the same arguments it advanced as regards the reasonableness of the EBR under Ad Note.  
The United States does not explain how or why the reasonableness analysis under the Ad Note should 
apply also to the "necessity" analysis under Article XX(d) or, further, how the EBR is applied in a 
manner consistent with the chapeau.  Thailand cons iders that the two provisions require different 
analyses on account of their different language.  Furt her, Thailand contends that the United States 
failed to establish why less trade-restrictive measur es are not adequate to ensure compliance in the 
collection of duties as regards subject shrimp.427  India reiterates its views that the Panel's approach 
was not premised on the standard of "substantial certainty" that margins of dumping were likely to 
increase, as alleged by the United States, and that  the United States did not bring relevant and 
persuasive evidence showing that margins of dumpi ng were "likely" to increase for subject shrimp.428  
India further submits that it identified "reasonabl e alternatives" to the EBR such as quicker 
completion of assessment reviews as a means to lowe r the non-collection risk referred to by the 
United States.429 
316. Turning to our assessment of the issues appealed , we are of the view that the "necessity" test 
under Article XX(d) is different from the "reasonableness" test under the Ad Note.  Relying on 
Appellate Body jurisprudence, the Panel consider ed that the following factors are relevant in 
determining whether a measure is "necessary" to secure  compliance with laws and regulations:  (i) the 
relative importance of the values or objectives the law or regulation is intended to protect;  (ii) the 
extent to which the measure contributes to the realization of the end pursued—the securing of 
compliance with the law or regulation at issue;  and (iii) the restrictive impact of the measure at issue
                                                      
425United States' other appellant's submissions, US – Shrimp (Thailand) , US – Customs Bond Directive , 
para. 23.  
426Ibid., para. 24.  
427See Thailand's appellee's submission, US – Shrimp (Thailand) , paras. 46-49. 
428India's appellee's submission,  US – Customs Bond Directive , para. 64. 
429Ibid., para. 67.  WT/DS343/AB/R 
 WT/DS345/AB/R 
 Page 123 
 
 
on imports.430  We see no error in the Panel's analysis of  the meaning of the term "necessary" and the 
factors relied upon by it to evaluate the necessity of  the EBR to secure comp liance with certain laws 
and regulations of the United States, as the Panel' s analysis is in consonance with the previous 
jurisprudence of the Appellate Body. 
317. The EBR is intended to secure potential additi onal liability that might arise from significant 
increases in the amount of dumping after the impositi on of an anti-dumping duty order.  The United 
States has not demonstrated that the margins of dumping for subject shrimp were likely to increase 
significantly so as to result in significant additio nal liability over and above the cash deposit rates.  
Like the Panel, we do not, therefore, see how taking security, such as the EBR, can be viewed as being "necessary" in the sense of it contributing to th e realization of the objective of ensuring the final 
collection of anti-dumping or countervailing duties in the event of default by importers.   
318. We therefore uphold  the Panel's findings, in paragra ph 7.192 of the Panel Report in US – 
Shrimp (Thailand)  and paragraph 7.313 of the Panel Report in  US – Customs Bond Directive , that the 
EBR, as applied to subject shrimp, is not "necessary" to secure compliance with certain laws or regulations within the meaning of Article XX(d) of the GATT 1994. 
319. In view of this conclusion that the EBR, as applied to subject shrimp, is not "necessary" 
within the meaning of Article XX(d), we do not ex press a view on the question of whether a defence 
under Article XX(d) of the GATT 1994 was available to the United States.
431 
XIII.  Findings and Conclusions 
320. In respect of the appeal of Panel Report, US – Shrimp (Thailand) , for the reasons set out in 
this Report, the Appellate Body: 
(a) upholds  the Panel's finding, in paragraph 7.130 of the Panel Report, that the 
application of the EBR falls within the temporal scope of the Ad Note, in the sense 
that the Ad Note authorizes the imposition of security requirements during the period 
following the imposition of a United States anti-dumping duty order; 
(b) declares of no legal effect  the interpretation developed by the Panel that the cash 
deposits required under United States la w following the imposition of an anti-
                                                      
430Panel Report, US – Shrimp (Thailand) , para. 7.189 and  Panel Report,  US – Customs Bond Directive , 
para. 7.310 (referring to Appellate Body Report, Korea – Various Measures on Beef , paras. 162 and 163).  See 
also, generally, Appellate Body Report, Brazil – Retreaded Tyres , paras. 139-183. 
431See supra , para. 310 . WT/DS343/AB/R 
WT/DS345/AB/R Page 124 
 
 
dumping duty order are not anti-dumping duties governed by Article 9 of the Anti-
Dumping Agreement ; 
(c) upholds
 the Panel's finding, in paragraph 7.150 of the Panel Report, that the 
additional security requirement resulting from the application of the EBR to subject 
shrimp is not "reasonable" within the meaning of the Ad Note; 
(d) reverses  the legal interpretation made by th e Panel, in footnote 184 to paragraph 
7.142 of the Panel Report, that, in the context of the application of the EBR, there is 
no obligation under the Ad Note to assess the risk of default by individual importers;  
and 
(e) upholds  the Panel's finding, in paragraph 7.192 of the Panel Report, that the EBR, as 
applied to subject shrimp, is not "necessary" within the meaning of Article XX(d) of 
the GATT 1994.   
321. Consequently, the Appellate Body upholds  the Panel's conclusion, in paragraph 8.1 of the 
Panel Report, that the application of the EBR to subj ect shrimp is inconsistent with Article 18.1 of the 
Anti-Dumping Agreement  because it is inconsistent with the Ad Note to Article VI:2 and 3 of the 
GATT 1994. 
322. The Appellate Body recommends  that the DSB request the United States to bring its measure, 
found in this Report and in the Panel Report, US – Shrimp (Thailand) , as modified by this Report, to 
be inconsistent with the Anti-Dumping Agreement  and the GATT 1994, into conformity with its 
obligations under those Agreements.  
323. In respect of the appeal of Panel Report, US – Customs Bond Directive , for the reasons set out 
in this Report, the Appellate Body: 
(a) upholds  the Panel's finding, in paragraph 7.107 of the Panel Report, that the 
application of the EBR falls within the temporal scope of the Ad Note, in the sense 
that the Ad Note authorizes the imposition of security requirements during the period 
following the imposition of a United States anti-dumping duty order; 
(b) declares of no legal effect  the interpretation developed by the Panel that the cash 
deposits required under United States la w following the imposition of an anti-
dumping duty order are not anti-dumping duties governed by Article 9 of the Anti-
Dumping Agreement ;  WT/DS343/AB/R 
 WT/DS345/AB/R 
 Page 125 
 
 
(c) upholds  the Panel's finding, in paragraph 7.128 of the Panel Report, that the 
additional security requirement resulting from the application of the EBR to subject 
shrimp is not "reasonable" within the meaning of the Ad Note; 
(d) reverses  the legal interpretation made by the Panel, in footnote 148 to 
paragraph 7.119 of the Panel Report, that, in the context of the application of the 
EBR, there is no obligation under the Ad Note to assess the risk of default by 
individual importers; 
(e) upholds  the Panel's finding, in paragraphs 7. 236-7.238 and 8.1 of the Panel Report, 
that the Amended CBD, by virtue of which the EBR is imposed, is not inconsistent 
"as such" with Articles 1 and 18.1 of the Anti-Dumping Agreement  and Articles 10 
and 32.1 of the SCM Agreement ; 
(f) upholds  the Panel's finding, in paragraphs 7.1 61, 7.263, 7.264, and 8.1 of the Panel 
Report, that the Amended CBD, by virtue  of which the EBR is imposed, is not 
inconsistent "as such" and "as applied" with Articles 9.1, 9.2, 9.3, and 9.3.1 of the 
Anti-Dumping Agreement  and that it is not inconsistent "as such" with Articles 19.2, 
19.3, and 19.4 of the SCM Agreement ; 
(g) finds it unnecessary , for purposes of resolving this dispute, to make an additional 
finding on India's claims that the Ame nded CBD is "as such" inconsistent with 
Article 18.4 of the Anti-Dumping Agreement  and Article 32.5 of the SCM Agreement ; 
(h) upholds  the Panel's finding, in paragraph 7.19 6 of the Panel Report, that Section 1623 
of the Tariff Act and Section 113.13 of th e United States Regulations were not within 
its terms of reference;  
(i) finds  that the Panel did not breach its obligation to make an objective assessment of 
the matter under Article 11 of the DSU, since it did not make a  prima facie  case for 
the United States when it included, in its  analysis under Article XX(d) of the 
GATT 1994, certain laws and regulations othe r than those specifically cited by the 
United States for purposes of its defence under that provision; and 
(j) upholds  the Panel's finding, in paragraph 7.313 of the Panel Report, that the EBR, as 
applied to subject shrimp, is not "necessary" within the meaning of Article XX(d) of 
the GATT 1994;  and, therefore, does not express a view on the question of whether a 
defence under Article XX(d) of the GATT 1994 was available to the United States.   WT/DS343/AB/R 
WT/DS345/AB/R Page 126 
 
 
324. Consequently, the Appellate Body upholds
 the Panel's conclusion, in  paragraph 8.2(i) of the 
Panel Report, that the application of the EBR to subj ect shrimp is inconsistent with Article 18.1 of the 
Anti-Dumping Agreement  because it is inconsistent with the Ad Note to Article VI:2 and 3 of the 
GATT 1994. 
325. The Appellate Body recommends  that the DSB request the United States to bring its measure, 
found in this Report and in the Panel Report, US – Customs Bond Directive , as modified by this 
Report, to be inconsistent with the Anti-Dumping Agreement  and the GATT 1994, into conformity 
with its obligations under those Agreements.  
 
Signed in the original in Geneva this 27th day of June 2008 by:  
 
  
 
 
_________________________ 
Giorgio Sacerdoti  
Presiding Member 
 
 
   
 _________________________ _________________________ 
 Luiz O. Baptista A.V. Ganesan 
 Member Member 
  WT/DS343/AB/R 
 WT/DS345/AB/R 
 Page 127 
 
 
ANNEX I  
 
 WORLD TRADE  
ORGANIZATION  WT/DS343/10 
22 April 2008 
 (08-1911) 
 Original:   English 
 
UNITED STATES – MEASURES RELATING TO SHRIMP FROM THAILAND 
 
Notification of an Appeal by Thailand  
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 17 April 2008 , from the Delegation of Thailand, is being 
circulated to Members. 
_______________ 
 1. Pursuant to Article 16.4 and Article 17 of the Understanding on Rules and Procedures 
Governing the Settlement of Disputes  (the "DSU") and Rule 20  of the Appellate Body's Working 
Procedures for Appellate Review , Thailand hereby notifies its decisi on to request the Appellate Body 
to review cert ain issues of law covered in the report of the Panel in United States – Measures 
Relating to Shrimp from Thailand (WT/DS343/R) (the "Panel Report") and certain legal 
interpretations developed by the Panel therein.   
 
2. Thailand seeks review by the Appellate Body  of the following issues of law and legal 
interpretations of the provisions of the General Agreement on Tariffs and Trade 1994 (the "GATT 
1994") and the Agreement on Implementation of Article VI  of the General Agreement on Tariffs and 
Trade 1994 (the " Anti-Dumping Agreement "): 
 
(a) The Panel's interpretations of the phrase "pendi ng final determination of the facts in any case 
of suspected dumping" in paragraph 1 of the Ad Note to Articles VI:2 and 3 of the GATT 1994 to mean that (i) a case of "suspected dumping" may continue to exist even after the imposition of definitive anti-dumping measures, ( ii) the "final determination" in a case of 
suspected dumping refers not to the decisi on to impose definitive anti-dumping measures 
following an investigation conducted in acco rdance with Article 5 of the Anti-Dumping 
Agreement but instead only to the review of  the final amount of liability for duties in a 
subsequent review proceeding conducted under Ar ticles 9.3.1 or 9.3.2 of the Anti-Dumping 
Agreement, and (iii) the Ad Note therefore au thorises Members to require security following 
the imposition of definitive anti-dumping measure s (see paragraphs 7.88-7.130 of the Panel 
Report).  These interpretations are in error and are based on erroneous findings on issues of 
law and related legal interpreta tions.  Properly interpreted, the Ad Note applies only to 
measures imposed prior to a finding of dumping and injury that leads to the imposition of definitive anti-dumping measures (e.g., a U.S. anti-dumping order) and, as such, is governed 
by the provisions of Article 7 of the Anti-Dumping Agreement regarding provisional measures. 
 WT/DS343/AB/R 
WT/DS345/AB/R Page 128 
 
 (b) As a consequence of its interpretation that the Ad Note to Article VI is not temporally limited 
in scope (see issue (a) above), the Panel's c onclusion that Article 18.1 of the Anti-Dumping 
Agreement permits, in addition to the actions previously identified by the Appellate Body 
(provisional measures, price undertakings or  definitive duties), specific action against 
dumping in the form of security (cash deposits or bonds) based on a determination of likely 
future dumping margins (see, in particular, para graphs 7.97-98 and paragraphs 7.138-141 of 
the Panel Report).  This conclusion is in erro r and is based on erroneous findings on issues of 
law and related legal interpretati ons.  Properly interpreted, Artic le VI and Article 18.1 of the 
Anti-Dumping Agreement permit only action against dumping in the form of provisional 
measures, definitive duties, and price undertaki ngs, and nothing in Article 18.1 or Article VI, 
including the Ad Note, authorises additional specific action against dumping on the basis of likely future dumping margins. 
 (c) The Panel's interpretations that (i) monies co llected by the United States as cash deposits of 
estimated anti-dumping duties on importation of  goods subject to definitive anti-dumping 
measures within the meaning of Article 9.1 of the Anti-Dumping Agreement in the form of a U.S. anti-dumping order are not anti-dumping "duties" within the meaning of the Anti-Dumping Agreement and that (ii) these ca sh deposits of estimated anti-dumping duties 
collected at the time of importation are not subject to the requirement set out in Article 9.1 and the chapeau of Article 9.3 of the Anti-Dumping Agreement that the amount of such duties 
may not exceed the margin of dumping establishe d in accordance with Article 2 of the Anti-
Dumping Agreement (see paragr aphs 7.111-7.122 of the Panel Re port).  These interpretations 
are in error and are based on erroneous fi ndings on issues of law and related legal 
interpretations.  Cash deposits of estimated  anti-dumping duties collected at importation 
pursuant to a definitive anti-dumping measure imposed under Article 9 of the Anti-Dumping 
Agreement are anti-dumping duties within the meaning of Article 9 of the Anti-Dumping 
Agreement and may not, therefore, exceed the mo st recently-determined actual margin of 
dumping. 
 (d) Conditionally, in the event that the Appellate  Body upholds the Panel' s legal interpretations 
on issue (a) above, Thailand also seeks review of the Panel's interpretation of the Ad Note to 
Article VI to mean that an assessment of th e reasonableness of security required pursuant to 
the Ad Note does not involve or require any consideration of the risk of default or non-payment of anti-dumping duties by individual importers of goods subject to anti-dumping 
measures (see footnote 184 to para graph 7.142 of the Panel Report).   This interpretation is in 
error and is based on erroneous findings on issues of law and related lega l interpretations.   
 
_______________ 
  WT/DS343/AB/R 
 WT/DS345/AB/R 
 Page 129 
 
 
ANNEX II  
 
 WORLD TRADE  
ORGANIZATION  WT/DS345/9 
22 April 2008 
 (08-1912) 
 Original:   English 
 
UNITED STATES – CUSTOMS BOND DIRECTIVE FOR MERCHANDISE SUBJECT TO 
ANTI-DUMPING/COUNTERVAILING DUTIES 
 
Notification of an Appeal by India  
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 17 April 2008,  from the Delegation of India, is being 
circulated to Members. 
_______________ 
 
Pursuant to Articles 16.4 and 17 of the Understanding on Rules and Procedures Governing 
the Settlement of Disputes  (the "DSU") and Rule 20 of the Working Procedures for Appellate Review , 
India hereby notifies its decision to appeal to the Appellate Body certain issues of law covered in the 
Report of the Panel on United States – Customs Bond Directive for Merchandise Subject to 
Antidumping/ Countervailing Duties (WT/DS345/R) (the "Panel Report") and certain legal 
interpretations developed by the Panel in this dispute. 
 At issue is the enhanced bond requirement (t he "EBR") imposed by the United States on 
importers of certain frozen warmwater shrimp fro m India subject to anti-dumping duties imposed by 
the United States.  The United States has imposed th e EBR pursuant to certain instruments specified 
in paragraph 2.2 of the Panel Report which, for convenience, are referred to collectively as the 
"Amended CBD". 
 India seeks review by the Appellate Body of  the following errors of law and of legal 
interpretation by the Panel:  
1. The Panel erred in its conclusion (and re lated findings) that Article VI of the General 
Agreement on Tariffs and Trade 1994  (the "GATT 1994") read in conjunction with Articles 1 
and 18.1 of the Agreement on Implementation of Article  VI of the General Agreement on 
Tariffs and Trade 1994  (the " Anti-Dumping Agreement ") permits responses to dumping other 
than (a) definitive duties, (b) provisional measures and (c) price-undertakings.
1  In particular: 
 
(a) The Panel erred in finding that the Appellate Body's conclusions in  US – Antidumping 
Act of 19162 and US – CDSOA3 that the permissible responses to dumping are limited 
                                                      
1See Panel Report, paras. 7.62 - 7.77. 
2Appellate Body Report on United States – Anti-Dumping Act of 1916 , WT/DS136/AB/R, 
WT/DS162/AB/R, adopted 26 September 2000 (" U.S.-Antidumping Act of 1916 "). 
3Appellate Body Report on United States – Continued Dumping and Subsidy Offset Act of 2000 , 
WT/DS217/AB/R, WT/DS234/AB/R, adopted on 27 January 2003 (" U.S.-CDSOA "). WT/DS343/AB/R 
WT/DS345/AB/R Page 130 
 
 
to definitive anti-dumping duties, provisional measures and price-undertakings, are mere dicta  because, in those Reports, the Appella te Body did not even refer to the 
provisions of Note 1 Ad paragraphs 2 and 3 of Article  VI of the GATT 1994 (the "Ad 
Note").
4  The Panel's failure to follow the A ppellate Body's conclusions in previous 
disputes on the same issue is inconsistent with its function under Article 3.2 of the 
DSU of ensuring "security and predictabilit y to the multilateral trading system" and 
under Article 3.3 of ensuring the "prompt settle ment of situations" and, further, is 
inconsistent with its obliga tion under Article 11 to make an objective assessment of 
the matter. 
 
(b) The Panel erred in finding that the phrase "the provisions of the GATT 1994 , as 
interpreted by this Agreement" in Article 18.1 of the Anti-Dumping Agreement  was 
simply designed to clarify that the relevant provision of the GATT 1994 is Article VI.
5 
 
2. The Panel erred in its conclusion (and rela ted findings) that, in principle, the EBR was 
authorized by the Ad Note because the Anti-Dumping Agreement  did not prohibit it.6  I n  
particular: 
 
(a) The Panel erred in rejecting India's ar gument that the Ad Note was implemented 
through Article 7 of the Anti-Dumping Agreement  and could not be applied 
independently of Article 7 by finding that the Ad Note was not "… expressly limited 
to provisional measures taken prior to  a final determination of dumping".7 
 (b) The Panel erred also in finding that, wh ile in the case of the prospective system of 
assessment of anti-dumping duties, the phrase "final determination" in the Ad Note 
could be interpreted as the final determin ation that precedes the decision to impose 
duties,
8 in the case of the retrospective syst em followed by the United States, the 
same phrase could be interpreted as the "det ermination of the final liability for the 
payment of anti-dumping duties" referred to in Article 9.3.1 of the Anti-Dumping 
Agreement .9 
 
(c) Further, the Panel erred in  finding that, for purposes of taking security under the Ad 
Note, under the retrospective system of asse ssment followed by the United States, the 
anti-dumping duty order at the end of the orig inal investigation and again at the end 
of each new assessment review gave rise to a suspicion of dumping with respect to 
import entries into the United States afte r each such anti-dumping duty order and such 
suspicion lasted until the subsequent assessme nt review with respect to such import 
entries, in which both the existence and am ount of dumping could be determined with 
precision.10 
 3. The Panel erred in its conclusion (and re lated findings) that the Amended CBD was not 
inconsistent as such with the provisions of (a) Articles 1 and 18.1 of the Anti-Dumping 
Agreement  and (b) Articles 10 and 32.1 of the SCM Agreement .
11  In particular: 
                                                      
4See Panel Report, para. 7.76. 
5See Panel Report, para. 7.73 and footnote 113. 
6See Panel Report, paras. 7.71 – 7.84; 7.86 – 7.90; 7.95 – 7.107; 7.116 – 7.118 and footnotes 111-114.  
7See Panel Report, paras. 7.91 – 7.95. 
8See Panel Report, para. 7.86. 
9See Panel Report, paras. 7.86 – 7.87. 
10See Panel Report, paras. 7.80 – 7.87. 
11See Panel Report, paras. 7.236 – 7.238.  WT/DS343/AB/R 
 WT/DS345/AB/R 
 Page 131 
 
  
(a) The Panel did not make an objective assessment of the matter before it in accordance 
with the requirements of Article 11 of th e DSU when it concluded that the Amended 
CBD was discretionary in character.
12 
 
(b) The Panel also erred in concluding th at every application of the EBR under the 
Amended CBD would not necessarily constitute an impermissible specific action against dumping or subsidization, as the case may be.
13   
 
4. The Panel erred in concluding that the Amended CBD was not inconsistent with the 
provisions of Article 18.4 of the Anti-Dumping Agreement  and of Article 32.5 of the SCM 
Agreement .14  In the event that the Appellate B ody concludes that the Amended CBD is 
inconsistent as such with the pr ovisions of (a) Article 18.1 of the Anti-Dumping Agreement  
and (b) Article 32.1 of the SCM Agreement , India requests the Appellate Body to complete 
the analysis and rule in India's favour that  the Amended CBD is inconsistent with the 
provisions of Article 18.4 of the Anti-Dumping Agreement  and of Article 32.5 of the SCM 
Agreement  also. 
 5. The Panel erred in its conclusion (and re lated findings) that the Amended CBD was not 
inconsistent either as such
15 or as applied16 with the provisions of Articles 9.1, 9.2, 9.3 and 
9.3.1 of the Anti-Dumping Agreement  and was not inconsistent as such with the provisions of 
Articles 19.2, 19.3 and 19.4 of the SCM Agreement .17  In particular:  
 
(a) The Panel erred in finding that the defin ition of the term "duty" in Article 9 of the 
Anti-Dumping Agreement  is not broad enough to encompass cash deposits.18 
 
(b) The Panel erred in finding that the statement of the Appellate Body in U.S. – Zeroing 
(Japan)19 that, under the retrospective system of assessment, "… [a]t the time of 
importation, an administering authority may collect duties, in the form of cash deposits, on all export sales …." constituted obiter dictum .
20 
 
6. The Panel erred in its conclusion (and related findings) that certain provisions of U.S. law, 
i.e., 19 U.S.C. §1623 and 19 C.F.R. §113.13, did not form part of the Panel's terms of reference.
21 
 7. Further, in the event that the Appellate Body  upholds the Panel's conclusion that the Ad Note 
authorized the imposition of the EBR in principle,  India considers that the Panel erred in its 
conclusion (and related findings) that the Unite d States did not have any obligation to assess 
the risk of default by importers prior to imposing the EBR.
22  
 
                                                      
12See Panel Report, paras. 7.216 – 7.222; 7.227. 
13See Panel Report, paras. 7.225 – 7.227; 7.236. 
14See Panel Report, para. 7.271. 
15See Panel Report, paras. 7.262 – 7.263. 
16See Panel Report, paras. 7.97 – 7.105; 7.159 – 7.161. 
17See Panel Report, para. 7.264. 
18See Panel Report, paras. 7.98 – 7.106 and para. 7.160. 
19Appellate Body Report on United States – Measures Relating to Zeroing and Sunset Reviews , 
WT/DS322/AB/R, adopted on 23 January 2007 (" U.S – Zeroing (Japan) ").  
20See Panel Report, para. 7.101. 
21See Panel Report, paras. 7.181 – 7.196. 
22See Panel Report, paras. 7.118 and footnote 148. WT/DS343/AB/R 
WT/DS345/AB/R Page 132 
 
 8. The Panel also erred in its conclusion (and related findings) that it was permissible for the 
United States to defend the EBR under Article  XX(d) even though the Panel had found the 
EBR to be a specific action against dumping wh ich was not in accordance with the provisions 
of the GATT 1994.
23  
 
9. In the event that the Appellate Body concludes that Article XX(d) of the GATT 1994  
remained available to the Unite d States to justify the EBR, India considers that the Panel 
nevertheless acted inconsistently with its oblig ation under Article 11 of the DSU to make an 
objective assessment of the matter before it when  it found that, for the purpose of considering 
the defence of the United States under Article XX(d), the law or regulation at issue was 19 
U.S.C. §1673e(a)(1) read together with 19 U.S.C. §1673e(b)(1), 19 U.S.C. §1673, 19 C.F.R. §351.212(b)(1) and 19 C.F.R. §351.211(c)(1).
24 
 In sum, India considers that the Panel erred in law in the interpretation and application of Articles 1, 
7, 9.1, 9.2, 9.3, 9.3.1, 18.1 and 18.4 of the Anti-Dumping Agreement , of Articles  10, 19.2, 19.3, 19.4, 
32.1 and 32.5 of the SCM Agreement , of Article VI, the Ad Note and Article XX(d) of the GATT 
1994 and of Articles 3.2, 3.3 and 11 of the DSU.  
_______________ 
 
                                                     
 
23See Panel Report, paras. 6.11 – 6.13. 
24See Panel Report, para 7.300.  WT/DS343/AB/R 
 WT/DS345/AB/R 
 Page 133 
 
 
ANNEX III  
 
 WORLD TRADE  
ORGANIZATION  WT/DS343/11 
5 May 2008 
 (08-2112) 
 Original:   English 
 
UNITED STATES – MEASURES RELATING TO SHRIMP FROM THAILAND 
 
Notification of an Other Appeal by the United States  
under Article 16.4 and Article 17 of the Understanding on Rules  
and Procedures Governing the Settlement of Disputes (DSU),  
and under Rule 23(1) of the Working Procedures for Appellate Review  
 
 The following notification, dated 29 April 2008, from the Delegation of the United States, is being circulated to Members. 
_______________ 
 
1. Pursuant to Rule 23 of the  Working Procedures for Appellate Review , the United States 
hereby notifies its decision to appeal to the Appellate  Body certain issues of law covered in the Report 
of the Panel on United States – Measures Relati ng to Shrimp from Thailand  (WT/DS343/R) ("Panel 
Report") and certain legal interpre tations developed by the Panel. 
 2. The United States seeks review by the Appellate Body of the Panel's legal conclusion that the 
enhanced bond requirement is not consistent with the Ad Note to Article VI of the General Agreement 
on Tariffs and Trade 1994 ("GATT 1994") because it does not constitu te "reasonable" security (e.g., 
Panel Report, para. 7.150) and, related to this, the Panel's conclusion that the enhanced bond 
requirement is not consistent with Article 18.1 of the Agreement on Implementation of Article VI of 
GATT 1994 ("Antidumping Agreement") because it is not "in accordance with the provisions of the 
GATT 1994, as interpreted by the Antidumping Agreemen t" (e.g., Panel Report, paras. 7.151, 8.1).  
These findings are in error and are based on er roneous findings on issues of law and legal 
interpretations, including that additional security ma y only be considered "reasonable" within the 
meaning of the Ad Note if a Member demonstrates, first, that antidumping rates in the order "are likely to increase" and, second, properly determin es the "likely amount" of the increase (e.g., Panel 
Report, paras. 7.138-7.149). 
 
3. The United States also seeks review of the Panel's conclusion that the enhanced bond 
requirement is not justified pursuant to GATT 1994 Article XX(d) (e.g., Panel Report, para. 7.192), 
including its finding that unless a Member demonstrates  that rates in the order "are likely to increase", 
an additional security requirement cannot be c onsidered "necessary" within the meaning of 
Article XX(d) (e.g., Panel Report, para. 7.191).  In these circumstan ces, the United States additionally 
requests that the Appellate Body complete the Pane l's analysis with respect to Article XX(d).  The 
Appellate Body would not need to reach the U.S.  appeal under this paragraph where the Appellate 
Body has reversed the Panel findings and conclusions referenced in paragraph 1. 
 
_______________ 
 WT/DS343/AB/R 
WT/DS345/AB/R Page 134 
 
 
ANNEX IV
 
 
 WORLD TRADE  
ORGANIZATION  WT/DS345/10 
5 May 2008 
 (08-2114) 
 Original:   English 
 
UNITED STATES – CUSTOMS BOND DIRECTIVE FOR MERCHANDISE SUBJECT TO 
ANTI-DUMPING/COUNTERVAILING DUTIES 
 
Notification of an Other Appeal by the United States  
under Article 16.4 and Article 17 of the Understanding on Rules  
and Procedures Governing the Settlement of Disputes (DSU),  
and under Rule 23(1) of the Working Procedures for Appellate Review  
  The following notification, dated 29 April 2008, from the Delegation of the United States, is being circulated to Members. 
_______________ 
 
1. Pursuant to Rule 23 of the  Working Procedures for Appellate Review , the United States 
hereby notifies its decision to appeal to the Appellate  Body certain issues of law covered in the Report 
of the Panel on United States – Customs Bond Di rective for Merchandise Subject to 
Antidumping/Countervailing Duties  (WT/DS345/R) ("Panel Report") a nd certain legal interpretations 
developed by the Panel. 
 
2. The United States seeks review by the Appellate Body of the Panel's legal conclusion that the 
enhanced bond requirement is not consistent with the Ad Note to Article VI of the General Agreement 
on Tariffs and Trade 1994 ("GATT 1994") because it does not constitu te "reasonable" security (e.g., 
Panel Report, para. 7.130) and, related to this, the Panel's conclusion that the enhanced bond 
requirement is not consistent with Articles 1 and 18.1 of the Agreement on Implementation of Article 
VI of GATT 1994 ("Antidumping Agreement") because it is not  "in accordance with the provisions of 
the GATT 1994, as interpreted by the Antidumping Ag reement" (e.g., Panel Report, paras. 7.131, 
8.2(i)).  These findings are in error and are based on erroneous findings on issues of law and legal interpretations, including that additional security ma y only be considered "reasonable" within the 
meaning of the Ad Note if a Member demonstrates, first, that antidumping rates in the order "are 
likely to increase" and, second, properly determin es the "likely amount" of the increase (e.g., Panel 
Report, paras. 7.116-7.126).  3. The United States also seeks review of the Panel's conclusion that the enhanced bond 
requirement is not justified pursuant to GATT 1994  Article XX(d) (e.g., Pa nel Report, para. 7.313), 
including its finding that unless a Member demonstrates  that rates in the order "are likely to increase", 
an additional security requirement cannot be c onsidered "necessary" within the meaning of 
Article XX(d) (e.g., Panel Report, para. 7.312).  In these circumstan ces, the United States additionally 
requests that the Appellate Body complete the Pane l's analysis with respect to Article XX(d).  The 
Appellate Body would not need to reach the U.S.  appeal under this paragraph where the Appellate 
Body has reversed the Panel findings and conclusions referenced in paragraph 1.  
 
__________