WT/DS341/R 
 Page B-1 
 
 
  
ANNEX B 
  
THIRD PARTY SUBMISSIONS 
  
Contents Page 
Annex B-1 Executive Summary of the Third Party Submission of Canada B-2 
Annex B-2 Executive Summary of the Third Party Submission of China B-6 
Annex B-3 Executive Summary of the Third Party Submission of Japan B-8 
Annex B-4 Executive Summary of the Third Party Submission of Norway B-13 
Annex B-5 Executive Summary of the Third Party Submission of the 
United States B-18 
Annex B-6 Third Party Oral Statement of Canada B-24 
Annex B-7 Third Party Oral Statement of the United States B-25 
 WT/DS341/R 
Page B-2  
 
 
ANNEX B-1 
  
EXECUTIVE SUMMARY OF THE THIRD PARTY 
SUBMISSION OF CANADA 
 
 
(21 June 2007) 
  
I. INTRODUCTION 
 1. Canada considers that these proceedings raise significant systemic issues regarding 
countervailing investigatio ns conducted under the WTO Agreement on Subsidies and Countervailing 
Measures  (SCM Agreement).  Canada's submission focu ses on two issues.  The first issue concerns 
the necessity for investigating aut horities to ensure that the procedural rights of parties to the 
investigations are respected.  The second issue rela tes to the necessity for a Member to demonstrate 
the pass through of a subsidy.  That is, in circ umstances where an input subsidy is received by 
someone other than the producer or exporter of the product under investigation, investigating 
authorities may not impose countervailing measures
 on the product unless they have demonstrated 
that the subsidy was passed through to the producer or exporter of the product under investigation. 
 
II. ARGUMENT 
 
1. Procedural Claims 
 
2. Canada notes that, among its specific claims of  violation, the European Communities (the EC) 
alleges several procedural violations by the Mexi can investigating authority both before and during 
the course of the investigation.  These include th e failure:  to afford the EC an opportunity for 
consultations prior to the initiation of the inv estigation, contrary to Article 13.1 of the  SCM 
Agreement; to require the complainant to provi de non-confidential summaries of confidential 
information, contrary to Article 12.4.1 of the SCM Agreement; to disclose essential facts, contrary to 
Article 12.8 of the SCM Agreement; and to provide  a reasoned and adequate explanation of key 
determinations underpinning the imposition of countervailing duties. 
 3. Canada, and indeed the broader WTO Membersh ip, has an overarching systemic interest in 
ensuring that the investigating authorities of all Members adhere to the basic requirements of due 
process (procedural fairness) as prescribed in the covered agreements, including the SCM Agreement. 
In this regard, while Canada does not intend to opin e on the merits of the EC 's individual claims of 
procedural violation, it feels compelled to ra ise certain concerns about the potential broader 
ramifications of the denial of due process in trade remedy investigations.   4. Each party to a countervail investigation (or,  for that matter, an anti-dumping or safeguard 
investigation) is entitled to a reasonable opportunity  to defend its interests.  This ability depends 
directly upon the party having adequate knowledge of the oppos ing case (i.e., of the specific 
allegations and supporting evidence of parties adve rse in interest), and being afforded a reasonable 
opportunity to present its own case (i.e., to present arguments and evidence in support of its own position and to rebut opposing positions).  Clearly, the EC 's claims of violation – if borne out – would 
constitute critical breaches of the basic due process re quirements set out in the SCM Agreement.  In 
this regard, if substantiated, the failure of th e Mexican investigating authority to provide an 
opportunity for pre-initiation consultati ons would have deprived the EC of any prospect of influencing 
the initiation decision, while the aut hority's failures in respect of the disclosure of information in the  WT/DS341/R 
 Page B-3 
 
 
record would have deprived the EC of adequate knowledge of the case against it.  Likewise, if 
demonstrated, the absence of reasoned and adequate explanations of key dete rminations would have 
compromised the ability of the EC to identify a nd assess all potential grounds for the invocation of 
further related proceedings (e.g., administrative or judicial review).   2. Pass-Through 
 
5. Canada would like to stress the importance of , when dealing with i nput products, conducting 
a pass-through analysis where circumstances require  it.  The necessity of a pass-through analysis 
flows from the GATT 1994 and the SCM Agreement a nd has been acknowledged by panels and the 
Appellate Body. 
 6. When conducting an investigation concerning allegedly subsidized products, a Member must 
establish that a subsidy exists before it may impo se countervailing duties, and it may not impose such 
duties in an amount greater than the amount of the subs idy demonstrated to exist.  Article VI:3 of the 
GATT 1994 sets out this fundamental obligation.   The obligation to not impose countervailing 
measures in excess of any subsidy demonstrated to  exist is reaffirmed in Article 10 of the SCM 
Agreement.    7. Finally, Article 32.1 of the SCM Agreement c onfirms that the imposition of duties is unlawful 
where a Member fails in this obligation.  It provi des that "[n]o specific action against a subsidy of 
another Member can be taken ex cept in accordance with the provis ions of GATT 1994, as interpreted 
by this Agreement."  8. Nothing in the context or object and purpo se of these provisions alters the fundamental 
obligation to demonstrate the existence and the amou nt of a subsidy with respect to a product before 
imposing countervailing duties on that product.  This includes, in the context of an investigation 
concerning allegedly subsidized input products, the re quirement to demonstrate that an input subsidy 
to an upstream recipient has been  passed through to the downstream producers or exporters of the 
product under investigation.  9. Article 1.1 of the SCM Agreement sets out an exhaustive definition of "subsidy" that applies 
to this obligation.  Under this provision, there is no "subsidy" when a "benefit" has not been conferred 
upon a recipient.  The panel in US – Softwood Lumber IV , referring to the findings of the Appellate 
Body in Canada – Aircraft , found that the term "benefit" "implies some kind of comparison" and that 
the "marketplace" provides a basis for this comparison.  
10. In a pass-through context, the obligation on Members is to compare the transactions in 
question to the marketplace to determine whether, a nd to what extent, a benef it under Article 1.1(b) of 
the SCM Agreement is conferred.  As explained by the panel in US – Softwood Lumber IV , the results 
of such analysis may not be presumed:   
The heart of the pass-through issue is wh ether, where a subsidy is received by 
someone other than the producer or exporter of the product under investigation, the 
subsidy nevertheless can be said to have confe rred benefits in respect of that product.  
If it is not demonstrated that there has b een such a pass-through of subsidies from the 
subsidy recipient to the producer or exporter  of the product, then it cannot be said that 
subsidization in respect of that product, in  the sense of Article 10, footnote 36, and 
Article VI:3 of GATT 1994, has been found.  Thus, we find that a pass-through 
analysis is required by these provisions … where there are such upstream transactions. WT/DS341/R 
Page B-4  
 
11. Accordingly, where a subsidy is received by "someone other than the producer or exporter of 
the product under investigation", a Member must esta blish whether and to what extent the benefit to 
an upstream recipient passes to a downstream entity through the purchase of an input product. 
 12. In US – Softwood Lumber IV , the Appellate Body agreed with  the panel's interpretation.  
Drawing on the text of Article VI:3 of the GATT 19 94, the Appellate Body found that a Member may 
not presume that a subsidy passes through transactions  where "the producer of the input is not the 
same entity as the producer of the processed produc t".  The Appellate Body also explained in no 
uncertain terms that analysis under Article 1. 1(b) of the SCM Agreement is required:  
 
Where a subsidy is conferred on input products, and the countervailing duty is 
imposed on processed products, the initial reci pient of the subsidy and the producer 
of the eventually countervailed product, may not  be the same.  In su ch a case, there is 
a direct recipient  of the benefit – the producer of the input  product.  When the input is 
subsequently processed, the producer of the processed product  is an indirect recipient  
of the benefit – provided it can be establis hed that the benefit flowing from the input 
subsidy is passed through, at least in part, to the processed product.  Where the input producers and producers of the processed products operate at arm's length , the pass-
through of input subsidy benefits from the direct recipients to the indirect recipients downstream cannot simply be presumed; it must be established by the investigating authority.  In the absence of such analysis, it cannot be shown that the essential 
elements of the subsidy definition in Article 1 are present in respect of the processed 
product. 
13. Thus, the Appellate Body and panels have stressed the importance of demonstrating that a 
product is subsidized before imposing countervailing duties. 
 
14. In this case, the different steps that led from the production of olives to the exportation of 
olive oil and the relationships between the entiti es involved are not entirely clear to Canada.  
However, Canada observes that the EC Regula tion that established the production aid scheme 
indicated that the subsidy was granted to olive grow ers, albeit on the basis of the olive oil produced 
from their olives.  In these circumstances, it would appear to Canada that olives constitute an input 
product in relation to the processed product, olive oil, that is exported from the EC to Mexico. 
 
15. Moreover, Canada notes the EC argument that  the great majority of exporting EC companies 
had no involvement with olive growing and that th eir dealings were carried out entirely at arm's 
length.   
16. Therefore, under the circumstances of this cas e, it appears to Canada that the subsidy was 
received by someone other than the producer or exporter.  Accordingly, the requirement to demonstrate the pass through of a subsidy under Ar ticle VI of the GATT and Articles 10 and 32.1 of 
the SCM Agreement applies.  So too does the reasoning of the Appellate Body in US – Softwood 
Lumber IV , where it stated that in such circumstances a Member may not presume that the product 
under investigation was subsidized; rather, a Member  must demonstrate subsidization by means of a 
pass-through analysis. 
 17. Where input producers, here olive growers, and producers and/or exporters of the processed 
product, olive oil, operate at arm's length, the SCM Agreement requires clear evidence that input 
subsidy passed through to the producers of the processed product, so that there is a clear 
demonstration that the product against which c ountervailing measures are imposed is in fact 
subsidized.      18. Accordingly, under the circumstances of this case, the investigating authority was required to 
conduct a pass-through analysis to determine whethe r the subsidy that was granted to the olive  WT/DS341/R 
 Page B-5 
 
 
growers benefited the producers and/or exporters of th e olive oil subject to the investigation before it 
imposed countervailing measures to offset any such subsidization. 
 WT/DS341/R 
Page B-6  
 
ANNEX B-2 
  
EXECUTIVE SUMMARY OF THE THIRD PARTY 
SUBMISSION OF CHINA 
 
 
(21 June 2007) 
 EXECUTIVE SUMMARY  
China participates, as a third party, in this  panel proceeding concerning the Mexico's 
imposition of definitive countervailing measures on imports of olive oil originating in EC.  In this 
submission, China will briefly address three issues: 
 
(1) Whether a Petitioner Must Have Actual Out put When It Files a Petition for a Countervailing 
Duty Investigation? 
 
China believes that this question requir es a careful interpretation of the term producer .  While 
EC does not explicitly state so, its argument in  this proceeding is to narrow the term to actual 
producers  who have live output.  Broader reading of the term, however, may also include potential 
producers  who are substantially committed to  the production of like product. 
 
The ordinary meaning of the text in Article 11.4 of the SCM Agreement  does not provide 
definitive answer.  The textual analysis does not either support a reading that producers  may include 
potential producers  or preclude it. 
 
The context of the text of Article 11.4, how ever, warrants a broader reading of the term 
producer .  If EC's narrow reading of the term producer  were supported, no petition alleging injury in 
the form of retardation would have been permi ssible.  This would undermine footnote 45 of the SCM 
Agreement  and make the injury in the form of "retardation of the establishment of such an industry" 
meaningless.  Accordingly, China believes that EC's narrow reading of the term producer  is not 
warranted.  
EC's own practice does not support su ch a narrow reading of the term producer  as EC 
suggested in this case.  In an antidumping investigation on Imports  of DRAMs from Japan  conducted 
by EC, the European investigating authority did not adopt such a narrow reading.  In that proceeding, 
the Commission found that the community industry comprises four producers.  None of them, however, had actual output when the application for investigation was filed. 
 
(2) Whether the Domestic Industry Cannot Be "Injured" When the Petitioner Has No Actual 
Output during the POI-Subsidy Bu t Had Output during the POI-Injury? 
 
Obviously, EC's claim 2 and claim 7 are closel y related.  Both of them are based upon an 
allegation that no domestic industry  of olive oil existed in Mexico .  However, the time point and 
period for assessment of whether a domestic industry exists are different.  For claim 2 (standing 
issue), such time point, as EC put it, is "at the time of the application."  On the other hand, for claim 7 
(injury issue), such time period is "during the period of investigation used for the determination of the 
existence and amount of subsidy."  
China agrees that for different i ssues, e.g. standing issue and in jury issue, the time point and 
time period, within which the production and output  of domestic producers are measured, may be 
different.  China disagrees, however, that for injury  issue the appropriate time period, against which  WT/DS341/R 
 Page B-7 
 
 
the existence of domestic industry is evaluated is only the POI-Subsidy.  China believes that whether 
or not a domestic industry exists shall be exam ined against the POI-Injury rather than the POI-
Subsidy.  China has assumed as a fact that, during the POI-Injury, a domestic industry existed in Mexico, and such an industry can be injured by the subsidized imports. 
 
(3) Whether a "Pass-Through" Analysis Is Required Given the Facts Found in the Underlying 
Investigation? 
 
Pass-through is a unique concept under the SCM Agreement .  It arises from the context that 
subsidy is bestowed indirectly  upon producers of product subject to the investigation.  The issue is 
confusing in this case because, under the EC pr oduction aid program, the aid was provided to olive 
growers  while EC, in its various regulations, states that the aid was bestowed upon olive oil .  The 
Ministry found in paragraph 116 of its Final Resolution  that pass-through analysis is unnecessary 
because the subsidy is provided upon olive oil which is both the produc t subject to investigation and, 
in this case, the processed product. 
 
China disagrees with Mexico, who relies heavily on the statement in relevant EC regulations 
that the production aid is provided upon olive oil  but elects to ignore the fact that the production aid is 
provided to olive growers rather than manufacturers of  olive oil .  These complexities in factual 
situations require special caution in asce rtaining benefits a nd their recipients. 
 
 As concluding remarks, China believes that  certain aspects of Mexico's countervailing duty 
investigation raise systemic issues.  Mexico shall bring its measure in conformity with its obligation 
in case the Panel finds any inconsistence.  However,  it is also China's view that some of EC's 
arguments have driven the treaty interpretation to an  extent beyond the expressed intent of the treaty 
negotiators; and, therefore, should not be supported. 
 WT/DS341/R 
Page B-8  
 
ANNEX B-3 
 
 
EXECUTIVE SUMMARY OF THE THIRD PARTY 
SUBMISSION OF JAPAN 
 
 
(21 June 2007) 
  
 
TABLE OF CONTENTS 
 
 
I. INTRODUCTION ................................................................................................................ ...9 
 
II. ARGUMENT................................................................................................................... .........9 
 
A. MEXICO'S HANDLING OF THE INVESTIGATION RAISES SERIOUS  
 SYSTEMIC CONCERNS .........................................................................................................9  
1. By Failing to Complete the Investigation within 18 Months, Mexico Did Not  
 Comply with the Deadline Set Forth in Ar ticle 11.11 of the Agreement on Subsidies  
 and Countervailing Measures.................................................................................................9  
2. Mexico's Failure to Provide Non-Conf idential Summaries Was Inconsistent  
 with Article 12.4.1 of the Agreement on Subsidies and Countervailing Measures ............9 
 
3. Conclusion .................................................................................................................. ............10 
 
B. THE PANEL SHOULD EXAMINE WHETHER MEXICO'S DETERMINATION 
CONCERNING THE DOMESTIC INDUSTRY WAS APPROPRIATE ..............................10 
 
C. MEXICO DID NOT PROPERLY ADDRESS THE ISSUE OF SUBSIDIZATION..............11 
 
III. CONC LUSION ................................................................................................................ ......12 
 
  WT/DS341/R 
 Page B-9 
 
 
 
I. INTRODUCTION 
 
1. As a third party to this dispute, Japan w ould like to address, from a systemic viewpoint to 
ensure objective and consistent interpretation of the WTO Agreement, the following issues: 
 
• Mexico's handling of the investigation raises serious systemic concerns; 
 
• The Panel should examine whether Mexico's de termination concerning the domestic industry 
was appropriate; and 
 
• Mexico did not properly address the issue of subsidization. 
 
II. ARGUMENT 
 
A. MEXICO'S HANDLING OF THE INVESTIGATION RAISES SERIOUS SYSTEMIC 
CONCERNS 
 
2.  Japan is of the view that the integrity of the dispute settlement process is compromised 
whenever a Member conducts a domestic countervailing duty investigation that does not comply with 
the procedural rules set forth in the ASCM.  Japan  will focus on two procedural issues that the EC 
raised.   1.  By Failing to Complete the Investigatio n within 18 Months, Mexico Did Not Comply 
with the Deadline Set Forth in Article 11.11 of the Agreement on Subsidies and Countervailing Measures 
 
3. Mexico's investigation lasted more than 24 months from initiation to adoption of definitive 
measures.
1  The EC contends that, by virtue of th is lengthy timeframe, Mexico's actions were 
inconsistent with Article 11.11 of the ASCM, whic h stipulates that the duration of the investigation 
shall be "in no case more than 18 months".  4. Japan sympathizes with the position of the EC on this issue.  Although  Japan understands the 
need for Mexico to accept the parties' reasonable re quests for extension and verification, a Member's 
approval of such extension requests does not free it from the obligation to complete an investigation 
within the time limit set forth in Article 11.11.    5. Similarly, we need not address Mexico's questionable assertion of the object of Article 11.11.  Here, Article 11.11 states that inv estigations shall be concluded " in no case more than 18 months" 
(emphasis added):  the text is completely clear  and allows for only one interpretation.  The 
Article 11.11 prohibition against extending inves tigations beyond 18 months does not allow for any 
exception.    6. For these reasons, Japan is of the view that Mexico's investigation was inconsistent with 
Article 11.11 of the ASCM. 
 
2. Mexico's Failure to Provide Non-Confiden tial Summaries Was Inconsistent with 
Article 12.4.1 of the Agreement on Subsidies and Countervailing Measures 
 
7. The EC argues that Mexico committed another procedural violation of the ASCM by failing 
to provide, or to require private parties to provide, non-confidential summaries of confidential 
                                                      
1  EC First Written Submission, para. 113. WT/DS341/R 
Page B-10  
 
information submitted during the course of the investigation.
2  The relevant obligations are set forth in 
Article 12.4.1 of the ASCM.  8. Mexico claims that all parties provided bot h confidential and non-conf idential versions of 
their submissions.
3  Further, Mexico alleges that it fulfilled the object of Article 12.4.1 by allowing 
counsel to all parties to the investigation access to the entire investigation file, including both 
confidential and non-confidential data.4  
 9. In Japan's view, if Mexico failed, as the EC  claims, to require non- confidential summaries of 
the information listed by the EC, then Mexico acted  inconsistently with Article 12.4.1.  Mexico's 
provision of access to the investigation files doe s not by itself fulfil Mexico's obligation under 
Article 12.4.1.    10. Moreover, Mexico did not assert or seek to explain that it was faced with "exceptional 
circumstances" such that the information provi ded could not be summarized, as is permitted by 
Article 12.4.1. 
 
3. Conclusion 
 
11. It is the obligation of all Members to st rengthen and uphold the WTO system on all levels, 
and to abide by all rules, both procedural and substa ntive.  Nowhere is this more important than in the 
rules area, where Members are granted the right to  impose trade remedy measures only as long as they 
comply with the disciplines set forth in the rele vant agreements.  The failure to comply with 
procedural obligations compromises due process and fairness, which leads to systemic weakness and 
a lack of predictability that damages both Memb ers and private parties.  For these reasons, the 
procedural errors in Mexico's inv estigation are of concern to Japan.  
 
B. THE PANEL SHOULD EXAMINE WHETHER MEXICO'S DETERMINATION 
CONCERNING THE DOMESTIC INDUSTRY WAS APPROPRIATE 
 12. Japan is of the view that a critical issue of ge neral interest raised in this dispute is the proper 
determination of the existence of a domestic indus try.  The specific, very narrow, question Japan 
wishes to address is as follows: must the domestic indus try exist and be producin g during the time that 
an investigation takes place?  13. First, Japan agrees with the EC that in ge neral some level of domestic production must exist 
during the period of investigation for the purpose of making an injury determination.  The EC seems 
to argue that the relevant period for the production of olive oil is "the investigation period of the 
product subject to the investigation".
5  Japan understands this to be, by definition, a time period 
separate from that during which the investigation is actually conducted.  14. However, the EC also appears to argue that  the domestic industry must have produced during 
the time that the investigation was conducted.
6  The EC interprets words such as "causing injury" in 
Article 15.5 of the ASCM to refer clearly to the pr esent, "to what is happening when the investigation 
is carried out ".7  In addition, the EC refers to the factors listed in Article 15.4 as requiring 
                                                      
2  Id., paras. 103-107. 
3  Id., para. 89.  
4  Mexico's First Submission, paras. 82-87. 
5  EC First Written Submission, para. 183. 
6  Id., paras. 174-189. 
7  Id., para. 180 (emphasis added).  WT/DS341/R 
 Page B-11 
 
 
consideration concerning "the c ondition of an existing industry".8  The EC concludes that "there must 
be an industry presently in existence; in ot her words, there must be existing producers".9 
 
15. In Japan's view, the EC's apparent read ing of the ASCM would preclude a countervailing 
measure in precisely the situation where the subs idy was most pernicious - where it knocked the 
domestic producers out of the market.  There is nothing in the ASCM indicating that the Members intended to create this type of exception to the coverage of the ASCM.   
 
16. Article VI:6 of the GATT 1994 and Articles 10 and 15 of the ASCM clearly require a finding of injury during the period of investigation.  Without any production during that period there can be no evidence of injury as a result of an overall evalua tion of the elements listed in Article 15.4 of the 
ASCM.  However, this does not mean that domesti c production needs to occur throughout the period 
of investigation or the time period during which investigation is  being conducted.  
 
17. In Japan's view, if a company produces the subject merchandise even for a limited period of 
time during the period of investigation, the compan y should be qualified as a part of the domestic 
industry for the purpose of injury determination.  
18. Mexico's determination states, "[f]or the pur pose of evaluating injury, comparable periods of 
three years, including the period investigated we re used, i.e. April to December 2000, 2001, and 
2002."
10  Although Fortuny stopped production of olive oil in March 2002, it did engage in production 
in 2000 and 2001.  19. The Panel might find that Mexico appropriate ly set a longer period of investigation for the 
injury analysis (one that included 2000 and 2001) than for the subsidy determination.  Such a finding 
would support a further finding that Mexico did not err when it conducted an assessment of injury 
based on information related to this period, since it would mean that there was some production during the period of investigation.   
C. MEXICO DID NOT PROPERLY ADDRESS THE ISSUE OF SUBSIDIZATION 
 20. Mexico failed to properly analyze the subsidy issue by declining to engage in a pass-through 
analysis to determine whether and to what extent the subsidy given to olive growers benefited olive 
oil producers and exporters.
11  
 
21. Mexico bluntly rejects the need for a p ass-through analysis.  Apparently, the Mexican 
authority found that a purpose  of the EC subsidy scheme was to promote olive oil production, and 
therefore concluded that a pass-through analysis was not required.  22. Mexico is correct that the ASCM does not expressly require a pass-through analysis.  
However, in light of the provisions under Article 1.1(b) of the ASCM as well as Article VI:3 of 
GATT 1994, where the direct recipients of the alle ged subsidy are not those who produce or export 
the product subject to the investigation, as in th is case, the authority shall determine whether the 
producers or exporters concerned have actually indi rectly received any benefit from the subsidy.  
Article 14 of the ASCM also requires that an inv estigating authority, before imposing countervailing 
duties, calculate the amount of a subsid y in terms of the benefit conferred.  
 23. Well-established WTO practice shows that th e investigating authority must perform an 
analysis to determine the link between a subsidy and its allege d recipient.  In United States - Softwood 
                                                     
 
8  EC First Written Submission, para. 178. 
9  Id., para. 182. 
10  Final Resolution, para. 3. 
11  Mexico's First Submission, para. 116. WT/DS341/R 
Page B-12  
 
Lumber IV , the Appellate Body noted that "the pass-thr ough of input subsidy benefits from the direct 
recipients to the indirect recipients downstream cannot simply be presumed; it must be established by the investigating authority".
12Moreover, guidance on how to assess the impact of a subsidy granted to 
raw material producers on the price which processors of that material have to pay was provided under the earlier GATT regime.  (See, United States - Canadian Pork , a GATT panel interpreting the 
obligations under GATT Article VI.).
13  
 24. Mexico's argument is also flawed in th at it mischaracterizes the purpose of countervailing 
duties.  Mexico contends that "countervailing duties ar e not a mechanism to offset either a benefit or a 
subsidy"; according to Mexico, "[t]heir purpose is to offset the injury caused by an actionable 
subsidy".
14   
 25. Article VI:3 of the GATT 1994 as well as footnot e 36 to the ASCM clarifies the definition of 
the countervailing duty as "a special duty levied  for the purpose of offsetting any subsidy 
bestowed…."  Article 19.4 of the ASCM provides th at countervailing duties may be levied only up to 
the amount of the subsidy found to exist.  In additio n to this "capping" of the duty amount at the "full 
amount of the subsidy", Article 19.2 of the ASCM leaves to the discretion of the authority whether or not to set the duty at a lesser amount that w ould be adequate to remove the injury.   
 26. Furthermore, in U.S. – Softwood Lumber IV , the Appellate Body suggested that, for processed 
products in particular, the use of a pass-through an alysis may be necessary to preserve the connection 
between the countervailing duty to be imposed and the subsidy determined to have been granted.
15  In 
this way the authority can measure the extent to which a subsidy granted on an input may be included 
in the determination of the amount of the subsidy on the processed product.16   
 27. Japan does not consider that, in light of th e significance of a pass-through analysis, Mexico's 
reference to the purpose  of the subsidy or its assertion that coun tervailing duties are designed to offset 
injury  (not the subsidy), justifies its rejection of a pass-through analysis.  Therefore, in the view of 
Japan, Mexico erred in its determination that bene fits were conferred to the exporters concerned. 
 
III. CONCLUSION 
 28. Japan respectfully requests the Panel to exam ine carefully the facts and arguments presented 
by the EC and Mexico in light of the comments a bove, in order to ensure objective and consistent 
interpretation of the WTO agreements, particularly the ASCM and the DSU.  We welcome any questions that the Panel may ha ve regarding this submission. 
 
 
                                                     
 
12  United States - Final Countervailing Duty Determination with Respect to Certain Softwood Lumber 
from Canada (US – Softwood Lumber IV ), WT/DS257/AB/R (17 February 2004), para. 143. 
13  See United States - Countervailing Duties on Fresh, Chilled and Frozen Pork from Canada , adopted 
11 July 1991, BISD 38S/30, para. 4.10. 
14  Mexico's First Written Submission, para. 122. 
15  US – Softwood Lumber IV , para.140. 
16  See Id.   WT/DS341/R 
 Page B-13 
 
 
ANNEX B-4 
 
 
EXECUTIVE SUMMARY OF THE THIRD PARTY 
SUBMISSION OF NORWAY 
 
 
(21 June 2007) 
   
TABLE OF CONTENTS 
 
 
I.
 INTRODUCTION .................................................................................................................14  
 
II. DEFINITION OF THE DOMESTIC INDUSTRY.............................................................14  
 
2.1 Introduction................................................................................................................... .........14  
2.2 Whether injury was caused to  an established industry ......................................................14  
2.3 Industry support for the initiation .......................................................................................15  
 
III. PROCEDURAL ISSUES.......................................................................................................15  
 
3.1 The duty to ensure non-confidential summa ries of confidential information ..................15  
3.2 The duty to disclose essential facts .......................................................................................16  
 
IV. STANDARD OF REVIEW: THE DUTY TO PROVIDE A REASONED  
 AND ADEQUATE EXPLANATION IN SUPPORT OF THE  
 AUTHORITY'S CONCLUSIONS .......................................................................................17  
 
V.  CONCLUSION ................................................................................................................. .....17  
 WT/DS341/R 
Page B-14  
 
 
I. INTRODUCTION  
 
1. As a third party to this dispute, Norway would like to address the following issues discussed 
in the First Written Submissions of the EC and Mexico: 
 
• whether Mexico correctly defined the dom estic industry as required by the GATT 1994 and 
the Agreement on Subsidies and Countervailing Measures (ASCM)  (Section II); 
 
• whether Mexico fulfilled certain procedural requirements in the ASCM  (Section III); and 
 
• the appropriate Standard of Review (Section IV). 
 
II. DEFINITION OF THE DOMESTIC INDUSTRY 
 
2.1 Introduction 
 2. The EC contends that Mexico failed to define  domestic industry in a manner that is consistent 
with the GATT 1994 and the ASCM.
1 According to the EC, the wrongful determination of the 
domestic industry lead to both a wrongful injury determination and a failure by Mexico  to determine 
that there was sufficient industry support for the initiation of the investigation.2  
 3. The present case concerns an investigation wher e the Investigating Aut hority found injury to 
an established industry. Norway understands the Fi nal Resolution (imposing the definitive measures) 
to be based on "material injury to the domestic industry".
3  The case does not concern "material 
retardation to the establishment of such an  industry", as also confirmed by Mexico.4    
 
2.2 Whether injury was caused to an established industry 
 
4. Article VI.6 (a) of the GATT 1994 requires that  injury must be to an "established domestic 
industry".  The definition of "domestic industry" in ASCM  Article 16.1 provides that "domestic 
industry" must be understood as referring to:  "the domestic producers as a whole of the like products 
or to those of them whose collective output of th e products constitutes a ma jor proportion of the total 
production of those products." This provision de fines the domestic industry in relation to two 
elements, "producers" and the "products" they produce.  The ordinary meaning of the words 
"producers" and "product" indicate in Norway's view that there must exist a certain domestic 
production for there to be a "domestic industry".   5. Relevant context for the interpretation of th e definition of "domestic industry" is found in 
ASCM  Article 15.4 and Article 15.5, and the conclu sion to be drawn from these provisions supports 
the view that "domestic industry" must be unde rstood to mean an existing industry with on-going 
production.   6. The object and purpose of the rules on countervailing duties in the ASCM  is to provide a right 
for Member to impose such measures under certain conditions.  However, those rights have to be 
balanced against the right to u se subsidies under certain conditions.
5 The necessity to find the right 
                                                      
1 EC's First Written Submission, paras. 158 ff. 
2 EC's First Written Submission, paras. 93 – 94. 
3 Norway refers in this respect to the translation pr ovided in EC's First Written Submission, para. 199, 
where the EC cites the Final Resolution, para. 438. 
4 Mexico's First Written Submission, paras. 227 and 229. 
5 Appellate Body Report, US – Softwood Lumber IV , para. 64 and Appellate Body Report, US –  
Countervailing Duty Investigation on DRAMS,  para. 115.  WT/DS341/R 
 Page B-15 
 
 
balance in this equation suggests a narrow interpre tation of "domestic industry" when it comes who 
should be protected.  An industry that does not produce the like product should, therefore, not be afforded a protection as envisaged in the ASCM  under the provisions relating to injury to an 
established industry.  
7. In the present case, the Investigating Au thority found that the domestic industry was 
constituted of only one company – Fortuny de Mexico , SA de CV (Fortuny).  Mexico admits that 
Fortuny ceased production before the IP, in March 2002,  just before the investigating period started.
6 
The question for the Panel is thus whether a compa ny having ceased to produce before the IP, can still 
be considered to form (part of) the established  domestic industry, in an investigation into injury to an 
established industry.  Based on the facts as presented by  the parties to the dispute so far, it would 
seem that Fortuny, having ceased production, cannot be considered part of the domestic industry 
producing the like product.  8. Norway notes that Mexico employs the te rm "suspensión de actividades de Fortuny".
7  
Norway does not pronounce itself on the proper connotations to be given to this Spanish term, or the 
factual situation of Fortuny and its possible plans for any resumption of production after the investigation period.  Norway only notes that, to the extent that the Panel considers it necessary to 
also evaluate whether a "suspension" of productio n has different implications upon which companies 
may be considered part of an established industr y, the Panel must take into account that its 
interpretation must not undermine the distinction be tween investigations into injury caused to an 
established industry  as opposed to an investigation into subsidization causing material retardation  of 
the establishment of an industry.   
2.3 Industry support for the initiation 
 9. To the extent that the Panel finds that Fortun y could not be considered part of the domestic 
industry for purposes of the contested investigati on, the initiation itself is vitiated, and the 
investigation as such should never have been initiated.  
III. PROCEDURAL ISSUES 
 10. In this section, Norway will discuss the allegati ons by the EC that Mexico violated procedural 
rules in ASCM  Articles 12.4.1 and 12.8.  Rather than go in to the factual details of the case, Norway 
will outline how to interpret the mentioned provisions.   
3.1 The duty to ensure non-confidential summaries of confidential information  
 
11. The EC contends that Mexico failed to requi re the complainant to provide non-confidential 
summaries of confidential info rmation, inconsistent with ASCM  Article 12.4, and likewise that 
Mexico did not ensure that such summaries contained sufficient detail.
8 
 12. Mexico argues, amongst others , that its system provides opportunity for a legal representative 
of any interested party to see confidential inform ation through its system of "protected access".
9 
Mexico also argues that all interested parties did actually present non-confidential summaries of all 
confidential information presented to the Mexican investigating authority.10 
 
                                                      
6 Mexico's First Written Submission, paras. 222 and 226. 
7 Mexico's First Written Submission, para. 226. 
8 EC's First Written Submission, paras 103 – 108. 
9 Mexico's First Written Submission, paras 84 – 85. 
10 Mexico's First Written Submission, para. 89. WT/DS341/R 
Page B-16  
 
13. Norway will not discuss the factual aspects here , but point to two issues raised by the parties 
to the dispute:  (i) The relationship between a system  of "protected access" to the obligation to provide 
non-confidential summaries; and (ii) the need to refe r, in the preliminary or final resolution, to 
whether non-confidential summaries were requested or provided.   
14. In cases where a Member has set up a system of  "protected access" allowing interested parties 
access to all confidential information (provided thei r legal representative meets certain requirements), 
due process concerns may be safeguarded.  However, the interested party will only be incited to go 
through that process if it knows that there is confid ential information there to see.  The submission of 
non-confidential summaries of confidential informa tion, or statements explaining why such 
information cannot be summarized, being placed in  the non-confidential file, serves as a marker for 
the interested party to have its legal representa tive go through the process of gaining access to the 
confidential file.  Norway, therefore, believes that th e existence of a system of "protected access" to 
the confidential file does not in itself absolve the Investigating Authority of its duty to request the 
provision of non-confidential summaries of confidential information submitted to it. 
 
15. As to the second issue, Norway believes that  the reference to whether Mexico required, and 
interested parties provided, certain non-confidentia l summaries, is not an issue that revolves around 
whether there is a "statement" or "reference" to this effect in the final or preliminary resolution.  The 
question for this Panel is whether Mexico actua lly required the provision of such summaries from 
interested parties, whether access to such information was provided, whether any reliance upon such 
information was disclosed in accordance with ASCM  Article 12.8, and whether sufficiently detailed 
information was provided in the relevant reports or notices under ASCM  Article 22. 
 
3.2 The duty to disclose essential facts  
 16. The EC claims that Mexico is in breach of the requirement to disclose essential facts before a 
final determination is made, as the investigating authority did not (as the EC is aware) communicate a 
disclosure within the meaning of ASCM Article 12.8.
11 Mexico, on the other hand, argues that it 
provided disclosure through the "Resolución Preliminar" (RP) of 10 June 2004.12  
 17. This issue raises first substantive issues as to what inform ation was actually provided in any 
disclosure provided by the Investigating Authority of Mexico, and second  whether the provision of 
such information in the RP allowed interested pa rties sufficient time and opportunity to defend their 
interests.  18. Absent the factual record, Norway will not address the substantive issue of whether any 
disclosure of Mexico actually provided the required information.  Norway will only high-light certain 
arguments that may be of importance to the Panel when interpreting the requirements of ASCM  
Article 12.8 and applying that interpretation to the facts of this particular case. 
 19. WTO Panels and the Appellate Body have, in the anti-dumping context, interpreted the 
parallel provision in Article 6.9 of the Anti-Dumping Agreement  on several occasions.  Panels have 
found that the aim of disclosure is to "actually disclose to the interested  parties the essential facts 
which, being under consideration, are anticipated by  the authorities as being those which will form the 
basis for the decision whether to apply definitive measures."
13 Article 12.8 is meant to place interested 
parties in a position where they can properly unders tand, verify, and challenge the facts that are likely 
to lead the investigating authority to impose definitive measures.  
 
                                                      
11 EC's First Written Submission, para. 109. 
12 Mexico's First Written Submission, paras. 93 – 94. 
13 Panel Report, Argentina – Ceramic Tiles , para. 6.125.  WT/DS341/R 
 Page B-17 
 
 
20. The Panel will have to assess whether the RP c ontained the required information, and whether 
Mexico provided interested parties with the opport unity to comment and defend their interests based 
on this document.  Norway notes that – according to the time-line of events presented by the EC in its 
First Written Submission14 - a number of new questionnaires were sent out, and new submissions and 
verification visits took place after 10 June 2004.  Th e Panel will thus also have to assess whether, 
based on the evidence presented by the EC, there are any new facts submitted after the RP that fall 
within the scope of essential facts subject to disclosure, and that were not disclosed.  
IV. STANDARD OF REVIEW: THE DUTY TO PROVIDE A REASONED AND 
ADEQUATE EXPLANATION IN SUPPORT OF THE AUTHORITY'S 
CONCLUSIONS 
 
21. The EC claims that Mexico violated ASCM  Articles 22.3 and 22.5 because the investigating 
authority failed to provide a reasoned and ad equate explanation for many of its findings.
15 Under these 
provisions the investigating authority is given a comprehensive obligation to provide a transparent 
statement of the reasons for the imposition of defi nitive countervailing duties.  Thus, the authority 
must set forth the relevant facts in the record, a nd must explain "in sufficient detail" the factual and 
legal determinations made on the basis of the evid ence in the record that led to the imposition of 
measures.  The Appellate Body and panels have consistently ruled that the investigating authorities 
are required to provide a reasoned and adequate explanation , among others, of how the evidence in 
the record supports the authority's determination.16 The authority's explanation must demonstrate in a 
"clear and unambiguous" manner that the substan tive conditions for imposition of trade remedy 
measures have been satisfied.17 If an authority fails to explain itself adequately, it cannot demonstrate 
that it has respected the substantive requirements of the ASCM  governing those determinations. 
 22. In concluding, Norway submits that the Appe llate Body – with regard to the standard of 
review – has stated that a panel must examine whether the authority has provided a "reasoned and 
adequate explanation" of "how individual pieces of evidence can be reasonably relied on in support of 
particular inferences, and how the evidence in the record supports its factual findings".
18 
 
V.  CONCLUSION 
 23. Norway respectfully requests the Panel to exam ine carefully the facts presented by the parties 
to this case in light of our arguments, in order to ensure a proper and consiste nt interpretation of the 
ASCM . 
  
                                                     
 
14 EC's First Written Submission, paras. 59 – 70. 
15 EC's First Written Submission paras. 77 – 85. 
16 Appellate Body Report, US – Softwood Lumber VI (Article 21.5 – Canada ), para. 99. 
17 Appellate Body Report, US – Line Pipe , para 217. 
18 Appellate Body Report, US – Softwood Lumber VI (Article 21.5 – Canada ), para. 99. WT/DS341/R 
Page B-18  
 
ANNEX B-5 
 
 
EXECUTIVE SUMMARY OF THE THIRD PARTY 
SUBMISSION OF THE UNITED STATES 
 
 
(21 June 2007) 
  
 
TABLE OF CONTENTS 
 
Table of Reports Cited......................................................................................................... ...............19 
 
I. INTRODUCTION ................................................................................................................ .20 
 
II. THE PERIOD OF INVESTIGATION FOR DETERMINING INJURY MAY  
 BE LONGER THAN THE PERIOD EXAMINED FOR DETERMINING A  
 SUBSIDY ....................................................................................................................... .........20 
 
III. THE TEXT OF ARTICLE 15 OF THE SCM AGREEMENT DOES NOT  
 REQUIRE THE INVESTIGATING AUTHORITY TO BASE ITS   INJURY DETERMINATION ON THE TYPE OF INJURY ALLEGED   BY THE PETITIONER  OR APPLICANT ........................................................................21 
 
IV. THE PANEL SHOULD DETERMINE WHETHER MEXICO'S INJURY  
 ANALYSIS BASED ON AN EXAMINATION OF CERTAIN MONTHS OF EACH  YEAR IS CONSISTENT WITH THE "OBJECTIVE EXAMINATION"  REQUIREMENT IN ARTICLE 15.1 OF THE SCM AGREEMENT .............................21  V. ARTICLE 15.5 OF THE SCM AGREEMENT DOES NOT REQUIRE  
 AN INVESTIGATING AUTHORITY'S NON-ATTRIBUTION ANALYSIS TO  
 BE PERFORMED ON A QUANTITATIVE BASIS..........................................................22 
 
  WT/DS341/R 
 Page B-19 
 
 
 
Table of Reports Cited 
 
 
EC– Pipe Fittings (Panel)  Panel Report, European Communities – Anti-Dumping Duties on 
Malleable Cast Iron Tube or Pipe Fittings from Brazil , 
WT/DS219/R, adopted 18 August 2003,  as modified by Appellate 
Body Report, WT/DS219/AB/R 
EC – Pipe Fittings (AB)  Appellate Body Report, European Communities – Anti-Dumping 
Duties on Malleable Cast Iron Tube or Pipe Fittings from Brazil , 
WT/DS219/AB/R, adopted 18 August 2003 
EC – DRAMS  Panel Report, European Communities – Countervailing Measures 
on Dynamic Random Access Memory Chips from Korea , 
WT/DS299/R, adopted 3 August 2005 
Mexico – Rice (Panel)  Panel Report, Mexico –  Definitive Anti-Dumping Measures on 
Beef and Rice , WT/DS295/R, adopted 20 December 2005, as 
modified by Appellate Body Report, WT/DS295/AB/R 
Mexico – Rice (AB)  Appellate Body Report, Definitive Anti-Dumping Measures on 
Beef and Rice , WT/DS295/R, adopted 20 December 2005 
US – DRAMS (Panel)  Panel Report, United States – Countervailing Duty Investigation 
on Dynamic Random Access Memory Semiconductors (DRAMS) 
from Korea , WT/DS296/R, adopted 20 July 2005, as modified by 
Appellate Body Report, WT/DS296/AB/R 
 WT/DS341/R 
Page B-20  
 
 
I. INTRODUCTION 
 
1. The United States makes this third party submi ssion to provide the Panel with its view of the 
proper legal interpretation of certain provisions of the Agreement on Subsidies and Countervailing 
Measures  ("SCM Agreement") that are relevant to this dispute.  The United States recognizes that 
many of the issues raised in this dispute are solely  or primarily factual in nature.  The United States 
takes no view as to whether, under the facts of this  case, the measure at issue is inconsistent with 
Mexico's WTO obligations.  II. THE PERIOD OF INVESTIGATION FOR DETERMINING INJURY MAY BE 
LONGER THAN THE PERIOD EXAMINED FOR DETERMINING A SUBSIDY 
 
2. The EC makes an argument concerning Article 15.1 and the difference in the period of investigation for subsidy and injury.
1  The EC's argument is not entirely clear on this point.  To the 
extent that the EC is arguing that the periods of investigation for subsidy and injury must be 
completely coincident, there is no basis in the prov isions of the SCM Agreement for such a finding.  
Article 15.1 of the SCM Agreement provides that a de termination of injury "shall be based on positive 
evidence and involve an objective examination of ... the effect of the subsidized imports on prices in 
the domestic market for like products ... ."  Howe ver, the SCM Agreement does not require that the 
period investigated for purposes of determining in jury exactly match the period investigated for 
purposes of determining subsidization.   
 3. In the dispute involving the United States ' countervailing duty measure concerning DRAMs 
from Korea, the period for determining the subsidy was 18 months, whereas the period for 
determining injury exceeded three years in duration.
2  In evaluating the investigation by the 
United States, the panel stated: 
 
Article 15.2 does not require an investigating authority to demonstrate that all of the 
subject imports covered by the period of injury  investigation are subsidized ... .  It is 
not necessary that the period of review for subsidization must mirror the period of 
review for injury.3 
4. In EC – Pipe Fittings , the EC's investigating authority had examined a longer period for its 
injury determination than for its dumping determinat ion.  The panel found that the EC's approach was 
not inconsistent with the EC's obliga tions under Articles 3.1 and 3.2 of the Agreement on 
Implementation of Article VI of GATT 1994  ("AD Agreement"), the provisions that mirror the 
obligations of Articles 15.1 a nd 15.2 of the SCM Agreement.4  In its finding, the panel noted that the 
Recommendation Concerning Period of Data Collection for Anti-Dumping Investigations of the WTO 
Committee on Anti-Dumping Practices recommends that  the period of investigation in an injury 
investigation be longer than the period of  investigation in a dumping investigation.5  
 
                                                      
1 First Written Submission of the Eur opean Communities, paras. 204-07. 
2 US – DRAMS (Panel) , paras. 2.2, 7.243. 
3 US – DRAMS (Panel) , para. 7.245. 
4 EC – Pipe Fittings (Panel) , para. 7.321.  
5 EC – Pipe Fittings (Panel) , para. 7.321 (noting that the EC's period of investigation for the dumping 
investigation covered one year, while the period of investigation for injury covered three years).  WT/DS341/R 
 Page B-21 
 
 
III. THE TEXT OF ARTICLE 15 OF THE SCM AGREEMENT DOES NOT REQUIRE 
THE INVESTIGATING AUTHORITY TO BASE ITS INJURY DETERMINATION ON THE TYPE OF INJURY ALLEGED BY  THE PETITIONER OR APPLICANT  
 
5. The EC takes issue with the fact that, while the Mexican domestic industry's complaint 
alleged injury based on material retardation of an industry, Mexico's affirmative injury determination 
was based on a finding of present material injury.
6   
 6. Article 15 of the SCM Agreement provides th e obligations of Members with respect to a 
"Determination of Injury," and then in a footnote defi nes "injury" as meaning material injury, threat of 
material injury, or material retardation to th e establishment of an industry (emphasis added).  Nothing 
in the text of the SCM Agreement provides that a dete rmination of injury by an investigating authority 
must be based on the same type of injury as that alleged by the petitioner or applicant.   
IV. THE PANEL SHOULD DETERMINE WHETHER MEXICO'S INJURY ANALYSIS 
BASED ON AN EXAMINATION OF CERTAIN MONTHS OF EACH YEAR IS 
CONSISTENT WITH THE "OBJECTIVE  EXAMINATION" REQUIREMENT IN 
ARTICLE 15.1 OF THE SCM AGREEMENT 
 
7. The EC has criticized Mexico's choice of i nvestigation periods encompassing only the months 
of April through December in the years 2000, 2001, and 2002.
7  The EC claims that Mexico's choice 
of investigation periods "undermined" the "objectiven ess of the [injury] examination."  Article 15.1 of 
the SCM Agreement requires that the investigating authority's injury determination be based on an 
"objective examination" of the evidence pertaining to volume, price and impact.  Article 3.1 of the AD Agreement identically requires authorities to base injury determinations in antidumping 
investigations on an "objective examination" of the evidence pertaining to volume, price, and impact.  
In past disputes, the Appellate Body has raised c oncerns about analyzing only parts of years in an 
injury investigation under Article 3.1 of the AD Agreement.
8 
 8. In Mexico – Rice , the Appellate Body examined whet her Mexico's use of investigation 
periods encompassing only six months of each of the three calendar years examined satisfied this requirement.   
 
9. The panel in that dispute had found that Me xico's injury analysis did not satisfy this 
requirement for two reasons:   
[F]irst, whereas the injury analysis was selective and provided only a part of the 
picture, no proper justification was provided by Mexico in support of this approach; 
and secondly, [Mexico's investigating authorit y] accepted the ‘period of investigation 
proposed by the applicants because it a llegedly represented th e period of highest 
import penetration and would thus show the most negative side of the state of the 
domestic industry.'
9 
The Appellate Body sustained the panel's analysis.10 
 
                                                      
6 First Written Submission of the Eur opean Communities, paras. 194-197. 
7 First Written Submission of the European Communities, para. 211.  See also  First Written Submission 
of Mexico, para. 253-54. 
8  Mexico – Rice (AB) , paras. 173-88. 
9 Mexico – Rice (AB) , para. 176. 
10 Mexico – Rice (AB) , para. 183. WT/DS341/R 
Page B-22  
 
10. While there may be circumstances in which th ere could be "convincing and valid reasons for 
examining only parts of years,"
11 such an injury analysis could raise concerns under Article 15.1 of 
the SCM Agreement depending on the unde rlying reasons for that approach. 
 
V. ARTICLE 15.5 OF THE SCM AGREEMENT DOES NOT REQUIRE AN 
INVESTIGATING AUTHORITY'S NON-ATTRIBUTION ANALYSIS TO BE 
PERFORMED ON A QUANTITATIVE BASIS 
 
11. The EC also claims that Mexico breached Article 15.5 of the SCM Agreement because it 
failed to ensure that injury allegedly caused by other factors was not attributed to the subsidized 
imports.  In support of this claim, the EC argues that the non-attribution analysis should be 
"preferably on a quantitative basis."12 
 12. The United States takes no position with respect to whether Mexico's analysis demonstrated 
that any injury caused by other f actors was not attributed to the subsidized imports.  Nonetheless, the 
United States would point out that, although Article  15.5 of the Agreement sets out several factors 
that "may" be considered by investigating author ities in ascertaining whether there is a "causal 
relationship" between subsidized imports  and injury to the domestic industry,
13 it does not specify the 
type of information that an authority must collect  and examine for this purpose, or identify the detail 
in which the authority must explain its analysis of the information.  Rather, Article 15.5 simply 
provides that the investigating authority must determ ine, on the basis of "all relevant evidence" before 
it, whether such a causal relationship exists. 
 13. Article 15.5 also provides that the investigating authorities must examine any known factors other than the subsidized imports which are injuring  the domestic industry to ensure that injury caused 
by these other factors is not attributed to the su bsidized imports.  As the Appellate Body has 
recognized, the non-attribution provision of Article 3.5 of the AD Agreement, which mirrors the non-
attribution provision of Article 15.5 of the SCM Agreement, does not prescribe the specific methods 
that investigating authorities must use to demonstr ate that any injury caused  by factors other than 
unfairly traded imports is not attributed to such  imports.  The Appellate Body has stated that 
"provided that the investigating authority does not attribute the injuries of other causal factors to 
dumped imports, it is free to choose the methodology it will use in examining the ‘causal relationship' 
between dumped imports and injury."
14 
 14. Consequently, the EC's assertion that any non-a ttribution analysis should preferably be on a 
quantitative basis finds no support in the text of the SCM Agreement.
15  In support of its argument, 
the EC cites a panel report concerning an EC countervailing duty measure against DRAMs from 
Korea.16  However, in that report, the panel's concer n was that the investigating authority conduct a 
sufficient analysis rather than merely "check th e box" with respect to the non-attribution analysis.17  
The panel suggested ways that a non-attribution anal ysis could be made more  concrete, but the panel 
did not suggest that an otherwise sufficient non-attrib ution analysis should be rejected merely because 
the investigating authority's analys is was not quantitative.  Further, in a panel report issued nearly 
contemporaneously with EC – DRAMS , the panel found that the United States was not  required to 
                                                      
11 Mexico – Rice (Panel) , para. 7.82. 
12 First Written Submission of the Eur opean Communities, paras. 215-227. 
13 Article 15.5 provides that "{f}actors which may be relevant in this respect include, inter alia , the 
volume and prices of imports not sold at dumping prices, contraction in demand or changes in the patterns of 
consumption, trade-restrictive prac tices of and competition between the foreign and domestic producers, 
developments in technology and the export performance and productivity of the domestic industry." 
14 EC – Pipe Fittings (AB) , para. 189. 
15 First Written Submission of the European Communities, para. 218. 
16 First Written Submission of the European Communities, para. 218, citing EC – DRAMS , 
paras. 7.405, 7.437. 
17 EC – DRAMS , para. 7.405.  WT/DS341/R 
 Page B-23 
 
 
quantify the injury caused by other f actors in order to perform the non-attribution analysis required by 
Article 15.5 of the SCM Agreement.18 
  
                                                     
 
18 US – DRAMS (Panel) , para. 7.353.  WT/DS341/R 
Page B-24  
 
ANNEX B-6 
 
 
THIRD PARTY ORAL ST ATEMENT OF CANADA 
 
 
(26 June 2007) 
  1. Madam Chair, Members of the Panel, Canada first thanks you for your service on this panel. 
Canada's written submission, filed at the end of last  week, addressed two of the issues raised by this 
case, two issues that Canada believes are of fundame ntal systemic importance to WTO Members.  I 
would like to briefly recall those issues without repeating our submissions.  2. First, Canada emphasized the importance of a Member's investigating authority respecting the 
principles of due process contained in the SCM Agreem ent.  A further example of the concerns that 
motivated Canada's decision to intervene regardi ng the importance of respecting the principles of due 
process is Mexico's assertion that it would act consis tently with Article 13.1 of the SCM Agreement if 
it sent an invitation for consultations anytime up to  the day before the investigation was formally 
initiated.  In Canada's view, such an approach is  inconsistent with the object and purpose of this 
provision, which is aimed at affording a reasonable opportunity for meaningful consultations between 
the exporting Member and importing Member, with a view to reaching a mutually agreed solution 
before an investigation is launched.   The fact that Article 13.1 requires that the timing of the invitation 
allow for consultations before the investigation is formally initiated is conf irmed by Article 13.2 of 
the Agreement, which speaks of the opportunity to  "continue" the consultations "throughout the 
period of investigation." 
 
3. Second, with respect to the issue of pass- through, although the facts of this case are not 
entirely clear, it seems that the subsidy at issue is granted to the European producers of olives.  It 
further appears that a number of arm's length tr ansactions take place before the exportation of the 
actual product subject to the investigation of th e Mexican investigating authority.  In these 
circumstances, based on the relevant provisions we have cited in our brief and a line of cases up 
through the Appellate Body's decision in Softwood Lumber IV , it is Canada's submission that the 
Mexican investigating authority should have conducted a pass-through analysis to determine whether 
and to what extent the subsidy granted to the oliv e growers had passed through to the producer and/or 
exporter of the olive oil subject to the investigation.  
4. This concludes Canada's oral statement.  We would be glad to answer any questions the panel 
members may have concerning our written submission or oral statement.   WT/DS341/R 
 Page B-25 
 
 
ANNEX B-7 
 
 
THIRD PARTY ORAL STATEMENT OF 
THE UNITED STATES 
 
 
(26 June 2007) 
 
  1. Madame Chair and members of the Panel, the United States is pleased to present its views as a third party in this dispute.  As the Panel w ill recall, the United States has already filed a written 
submission, and we will not repeat the discussion cont ained therein.  Since that submission, we have 
had an opportunity to review all of the other third pa rty submissions filed, and we wanted to raise one 
matter today for the Panel's attention.  We would like to comment on the discussion by Norway in its third party submission regarding Ar ticle 12.8 of the SCM Agreement. 
 
2. Norway suggests that Mexico did not satisfy  the requirements of Article 12.8 because Mexico 
failed to identify "which facts in the file [are] lik ely to lead the authority to impose final duties."  
However, the claim advanced by the EC regarding Article 12.8 of the SCM Agreement is that there 
was no disclosure of any kind under Article 12.8 of the SCM Agreement, and not that Mexico did not 
disclose a particular fact, or that Mexico breached Ar ticle 12.8 by failing to iden tify particular facts.  
Thus, the question presented by Norway is not implicat ed by the EC's claim, and it would therefore be 
inappropriate for the Panel to reach it.  3. It is well-established that the burden of est ablishing a breach of an obligation under a covered 
agreement lies with the complaining party.  Furthe r, the burden of establishing a fact lies with the 
party asserting that fact.
1  For the EC to establish a breach of Ar ticle 12.8, it is the EC that would need 
to identify which facts were "essential" and to de monstrate that Mexico did not inform Members and 
interested parties of such facts in sufficient time.  
4. In light of this, it would be inappropriate for the Panel to identify particular facts that need to 
be disclosed under Article 12.8, as Norway suggests, because it is not the role of panels to establish a 
claim for a party where the burden for establishing that  claim lies with the party.  As the Appellate 
Body has stated, "panels have a significant investigative authority.  However, this authority 
cannot be used by a panel to rule in favour of  a complaining party which has not established a 
prima facie case of inconsistency based on specific legal claims asserted by it. "2 
 
5. This concludes my presentation.   Thank you for your attention. 
  
_______________ 
 
                                                     
 
1 Appellate Body Report, United States – Measure Affecting Imports of Woven Wool Shirts and Blouses 
from India , WT/DS33/AB/R and Corr.1, adopted 23 May 1997, p. 14.  See also , Appellate Body Report, EC 
Measures Concerning Meat and Meat Products (Hormones) , WT/DS26/AB/R, WT/DS48/AB/R, adopted 
13 February 1998, para. 97. 
2  Appellate Body Report, Japan – Measures Affecting Agricultural Products , WT/DS76/AB/R, 
adopted 19 March 1999, para. 129.