RESTRICTEDWORLD TRADE
ORGANIZATIONWT/DSB/M/109
3 October 2001
(01-4748)
Dispute Settlement Body
10 September 2001
MINUTES OF MEETING
Held in the Centre William Rappard
on 10 September 2001
Chairman:  Mr. R. Farrell (New Zealand)
Subjects discussed: Page
1. United States – Anti-dumping measures on certain hot-rolled steel products
from Japan..................................................................................................................... ............1
(a) Implementation of the reco mmendations of the DSB.................................................................1
2. United States – Countervailing measures concerning certain products from the
European Communities........................................................................................................... .2
(a) Request for the establishment of a panel by the European Communities...................................2
3. United States – Countervailing duties on certain corrosion-resistant carbon steel
flat products from Germany....................................................................................................3
(a) Request for the establishment of a panel by the European Communities...................................3
4. United States – Definitive safeguard measures on imports of steel wire rod and
circular welded quality line pipe .............................................................................................3
(a) Request for the establishment of a panel by the European Communities...................................3
5. United States – Continued Dumping and Subsidy Offset Act of 2000 .................................4
(a) Request for the establishm ent of a panel by Canada ..................................................................4
(b) Request for the establishm ent of a panel by Mexico ..................................................................4
6. United States – Anti-dumping measures on stainless steel plate in coils and
stainless steel sheet a nd strip from Korea...............................................................................6
(a) Statement by the United States .............................................................................................. .....6
1. United States – Anti-dumping measures on certain hot-rolled steel products from Japan
(a) Implementation of the recommendations of the DSB
1. The Chairman recalled that in accordance with the DSU provisions, the DSB was required to
keep under surveillance the implementation of recommendations and rulings of the DSB in order to
ensure effective resolution of disputes to the benefit of all Members.  In this respect, Article 21.3 of
the DSU provided that the Member concerned shall inform the DSB, within 30 days after the adoption
of the panel or Appellate Body report, of its intentions in respect of implementation of theWT/DSB/M/109
Page 2
recommendations and rulings of the DSB.  He recalled that at its meeting on 23 August 2001, the
DSB had adopted the Appellate Body Report on "U nited States – Anti-Dumping Measures on Certain
Hot-Rolled Steel Products from Japan" and the Panel Report on the same matter, as modified by the
Appellate Body Report.
2. The representative of the United States said that it was his country's intention to implement
the DSB's recommendations and rulings in a manner that would respect its WTO obligations.  The
United States was currently evaluating options for implementation, but would need a reasonable
period of time in order to implement.  The United States was ready to discuss this matter with Japan,
in accordance with Article 21.3(b) of the DSU.
3. The representative of Japan welcomed the statement by the United States on its intention to
implement the DSB's recommendations and rulings in th is case.  However, in order to implement, the
United States should first amend Section 735(c)(5)(A) of 1930 Tariff Act, which had been confirmedto be WTO-inconsistent.  The United States should also revoke immediately the anti-dumping duties
in force since they were based on the injury determ ination as well as the methods of calculating the
dumping margin both of which the Appellate Body and the Panel had found to be inconsistent with
the WTO Agreement.  In addition, Japan expected th at the United States would immediately cease to
apply the calculation and injury determination method, which had been found to be inconsistent withthe WTO Agreement, including the so-called 99.5 per cent arm's length test, the particular manner the
United States resorted to facts available and employed captive production provisions.  Japan wished to
receive information from the United States, as soon as possible, regarding steps, procedures and the
period for implementation.  Japan was ready to enter into consultations with the United States in order
to determine a reasonable period of time.
4. The DSB took note of the statements and of the information provided by the United States
regarding its intentions in respect of implementation of the DSB's recommendations.
2. United States – Countervailing measures concerning certain products from the
European Communities
(a) Request for the establishment of a panel by the European Communities (WT/DS212/4)
5. The Chairman recalled that the DSB had considered this matter at its meeting on
23 August 2001 and had agreed to revert to it.  He drew attention to the communication from the
European Communities contained in document WT/DS212/4.
6. The representative of the European Communities said that his statement related to the three
cases on steel pertaining to items 2, 3 and 4.  At the 23 August DSB meeting, the EC had lodged its
first requests for the establishment of a panel in the three cases at issue.  The situation had not evolved
since then and, therefore, the EC was requesting the establishment of panels for the second time.  Thethree cases in question covered 15 US measures.  Twelve countervailing duty orders were imposed
against pre-privatization subsidies.  Eleven of these measures had been imposed on the basis of an old
methodology, which the Appellate Body in the British Steel case
1 had found to be WTO-
incompatible. In that case, the Appellate Body ha d ruled against the US presumption that privatized
firms continued to benefit from subsidies obtained by previous state-owned companies.  The ECattached great importance to the removal of these US measures, which were the consequence of a law
and a methodology grounded on an erroneous interpretation of WTO rules.  In the '' de minimis " case,
which involved a sunset review of corrosion-resistant steel from Germany, the issue concerned the
maintenance of the measure where subsidization or dumping was at under de minimis  levels in sunset
reviews.  Two safeguard measures concerned welded line pipe and steel wire rod, where the main
                                                     
1 WT/DS138.WT/DSB/M/109
Page 3
problem related to the very low standard of injury applied by the United States in safeguard cases,
which were only intended to address emergency situations.  These matters, and in particular the case
on countervailing duty orders, were of major economic and systemic importance to the EC since the
contested US measures had severely impeded access to the US market and US steel consumers were
denied the opportunity to purchase European products at a fair and competitive price.
7. The representative of the United States said that since a panel to examine the case at issue
would be established at the present meeting, he did not wish to reiterate the points made by the United
States at the 23 August DSB meeting.  Instead, the United States would raise these points before the
panel.
8. The DSB took note of the statements and agreed  to establish a panel in accordance with the
provisions of Article 6 of the DSU with standard terms of reference.
9. The representatives of India and Mexico  reserved their third-party rights to participate in the
Panel's proceedings.
3. United States – Countervailing duties on certain corrosion-resistant carbon steel flat
products from Germany
(a) Request for the establishment of a panel by the European Communities (WT/DS213/3)
10. The Chairman recalled that the DSB had considered this matter at its meeting on
23 August 2001 and had agreed to revert to it.  He drew attention to the communication from the
European Communities contained in document WT/DS213/3.
11. The representative of the European Communitie s said that the statement made by the EC
under item 2 of the agenda of the present meeting also applied to item 3.
12. The representative of the United States noted that given that a panel would be established at
the present meeting to examine the EC's complaint in this case, he did not wish to reiterate the points
made by the United States at the 23 August DSB meeting.  Instead, the United States would make
these points before the panel.
13. The DSB took note of the statements and agreed  to establish a panel in accordance with the
provisions of Article 6 of the DSU, with standard terms of reference.
14. The representative of Japan reserved third-party rights to participate in the Panel's
proceedings.
4. United States – Definitive safeguard measures on imports of steel wire rod and circular
welded quality line pipe
(a) Request for the establishment of a panel by the European Communities (WTDS214/4)
15. The Chairman recalled that the DSB had considered this matter at its meeting on
23 August 2001 and had agreed to revert to it. He drew attention to the communication from the
European Communities contained in document WT/DS214/4.
16. The representative of the European Communities recalled that the EC had made a statement
on this matter at the 23 August DSB meeting.  He said that the EC had held consultations with the
United States regarding steel wire rods.  Thus, it was possible that, at a later stage, the examination by
the panel would only be limited to line pipes.WT/DSB/M/109
Page 4
17. The representative of the United States said that his country had noted the statement made by
the EC, but was disappointed that the EC had chosen to move ahead with the establishment of a panel
to examine these measures.  The United States had implemented the measures only after the US
International Trade Commission had conducted careful and exhaustive investigations, which
demonstrated that imports of these products were causing or threatening to cause serious injury to USindustries.  The WTO rules specifically provided that governments might impose temporary import
restrictions to prevent or remedy serious injury under these types of circumstances.  He recalled that at
the 23 August DSB meeting, the United States had stated that the EC had alleged, in its panel request,
that the safeguard measures were inconsistent, "in particular, but not necessarily exclusively," with
certain listed provisions of the Agreement on Safeguards and the GATT 1994.  At the present
meeting, he wished to reiterate the objections and difficulties his country had with that phrase and said
that the United States would vigorously defend these measures before the panel.  In the meantime, theUnited States hoped that the establishment of the pa nel would not prevent the EC from exploring the
possibility of finding a mutually satisfactory solution to this matter.
18. The DSB took note of the statements and agreed
 to establish a panel in accordance with the
provisions of Article 6 of the DSU with standard terms of reference.
19. The representatives of Canada, Japan  and Mexico  reserved their third-party rights to
participate in the Panel's proceedings.
5. United States – Continued Dumping and Subsidy Offset Act of 2000
(a) Request for the establishment of a panel by Canada (WT/DS234/12)
(b) Request for the establishment of a panel by Mexico (WT/DS234/13)
20. The Chairman recalled that the DSB had considered this matter at its meeting on
23 August 2001 and had agreed to revert to it.  He proposed that the two sub-items be considered
together.  He then drew attention to the communication from Canada contained in document
WT/DS234/12.
21. The representative of Canada said that this was his country's second request for the
establishment of a panel to examine the WTO-consis tency of the Byrd Amendment.  He recalled that
at the 23 August meeting, when the DSB had established a panel on the Byrd Amendment at the
request of nine other Members, the United States had unfortunately refused the first requests for a
panel made by both Canada and Mexico.  At that meeting, Canada had recalled that it had repeatedly
expressed its concerns to the United States about the negative systemic implications of this legislation.
As had been noted at that meeting, WTO rules only permitted Members to take measures that offset
dumping or subsidization.  They did not allow Memb ers to redistribute remedial duties in order to
offer their industry double protection.  Moreover, by creating a clear incentive for US industry to fileand support cases against companies exporting to the United States, this legislation also exposed
imports of other Members to the threat of arbitrary dumping and countervailing duty investigations.
Canada remained of the view that the Byrd Amendment violated US obligations under the WTO
Agreement, and reiterated its request for the establishment of a panel.  It was his country's hope and
expectation that all complaints relating to this matter would be examined by a single panel, in
accordance with Article 9 of the DSU.
22. The Chairman drew attention to the communication from Mexico contained in document
WT/DS234/13.WT/DSB/M/109
Page 5
23. The representative of Mexico said that at the 23 August DSB meeting his country had made
its first request for the establishment of a panel to examine the application of the Byrd Amendment.
However, that request had been declined by the United States.  At the present meeting, he wished to
reiterate his country's position that this legislation was counter to the US' WTO-obligations.  Mexico
was also requesting that a single panel be established to examine the complaints by Canada andMexico together with the complaint by nine other Members,  in accordance with Article 9 of the DSU.
24. The representative of the United States said that, as had been stated at previous DSB
meetings, it was his country's view that the Byrd Amendment was fully consistent with US
international obligations under the WTO and the United States intended to defend it vigorously before
the panel.  The United States re-emphasized that this law did not alter how the United States made
anti-dumping or countervailing duty determinati ons, or the amount of duties assessed on dumped or
subsidized imports, which were issues covered by the WTO Agreement.  The WTO Agreement didnot address what a country might do with anti-dumping and countervailing duties after they had been
collected.
25. The representative of the Japan wished to reiterate his country's concerns regarding the WTO-
consistency of the Byrd Amendment.  He noted that the number of complainants against the
legislation in question amounted to ten countries and the EC.  This was a clear indication that theconcern raised by the Byrd Amendment was shared world-wide.  Since all the complaints related to
the same legislation, Japan welcomed the establishment of a single panel, pursuant to Article 9.1 of
the DSU.
26. The representative of the European Communities welcomed the request by Canada and
Mexico for the establishment of a single panel.  He noted that their panel requests related to the same
matter like the one raised by nine countries.  For this reason and in view of the systemic nature of the
issues raised by this case, the EC could agree to the establishment of a single panel pursuant to
Article 9.1 of the DSU.
27. The Chairman said that it was his understanding that the United States was ready to accept the
establishment of a single panel.
28. The representative of the United States confirmed that his country was in a position to agree
to the establishment of a single panel at the present meeting.
29. The DSB took note of the statements and agreed  that the requests by Canada and Mexico for
the establishment of a panel with standards terms of reference are accepted, and that as provided for in
Article 9 of the DSU, in respect of multiple complainants, the Panel established on 23 August 2001 to
examine the joint complaint by Australia, Brazil, Chile, European Communities, India, Indonesia,
Japan, Korea and Thailand contained in document WT/DS217/5 would also examine Canada'scomplaint contained in document WT/DS234/12 an d Mexico's complaint contained in document
WT/DS234/13.
30. The Chairman noted that since a single Panel was established those delegations who had
reserved their third-party rights to participate in the Panel established on 23 August 2001 at the
request of Australia, Brazil, Chile, European Communities, India, Indonesia, Japan, Korea andThailand, shall be considered as third parties in the single Panel.
31. The representative of Canada reserved its thir d-party rights in relation to the complaint by
Mexico.WT/DSB/M/109
Page 6
32. The representative of Mexico noted the statement made by the Chairman with regard to third-
party participation in the single Panel.  However, he wished to reserve his country's third-party rights
in relation to the complaint by Canada.
33. The DSB took note of the statements.
6. United States – Anti-dumping measures on stai nless steel plate in coils and stainless steel
sheet and strip from Korea
(a) Statement by the United States
34. The representative of the United States, speaking under "Other Business", announced that his
country had implemented the DSB's recommendations and rulings in this case by 1 September 2001,
the date of expiry of the reasonable period of time.  The re-determinations in both the stainless steel
sheet and the stainless steel plate investigations had been effective on 28 August 2001.
35. The representative of Korea said that his delegation had noted the US statement and thanked
the United States for implementing the DSB's recommendations in a prompt manner, within the
reasonable period of time mutually agreed between Korea and the United States.  In this connection,
the US Department of Commerce was conducting administrative reviews of the anti-dumping orders
on stainless steel plate in coils and stainless steel sheet and strip.  He noted that the principles for
calculating dumping margins specified by the Panel and recommended by the DSB applied equally tothe administrative reviews as to the original inve stigation.  Therefore, it was Korea's understanding
that the United States would follow the same cal culation methodologies in the reviews like in the
present re-determinations.  Korea also understood that the United States had taken cognizance of the
relationship between the original investigations and the administrative review in this regard.  Finally,
Korea thanked the Panel and the WTO Secretariat fo r their work in this complex case, which had
raised many important issues.  As several Members had pointed out at previous DSB meetings, the
Panel Report had made an important contribution to the clarification of Members' rights and
obligations under the Anti-Dumping Agreement.
36. The DSB took note of the statements.
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