UNITED STATES – MEASURES RELATING TO ZEROING AND SUNSET REVIEWS
Document: Notification of an Appeal by Japan under Article 16.4 and Article 17 of the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU), and under Rule 20(1) of the  Working Procedures for Appellate Review
Date: 11 October 2006
Document codes: WT/DS322/12
Complainant: Japan
Respondent: U.S.
Third parties: Argentina, China, EU, Hong Kong, India, South Korea, Mexico, New Zealand, Norway, Taiwan, Thailand
Dispute stage: Implementation & Compliance
Agreements cited: Art. 2.1, 2.4, 2.4.2, 9.1, 9.2, 9.3, 5.8, 3, 9.5, 11.1, 11.2, 11.3, 1  Anti-dumpingArt. VI  GATT 1994Art. 18.4  Anti-dumpingArt. XVI:4  Agreement Establishing the World Trade Organization

UNITED STATES – MEASURES RELATING TO ZEROING
AND SUNSET REVIEWS

Notification of an Appeal by Japan
under Article 16.4 and Article 17 of the Understanding on Rules
and Procedures Governing the Settlement of Disputes (DSU),
and under Rule 20(1) of the Working Procedures for Appellate Review

 The following notification, dated 11 October 2006, from the Delegation of Japan, is being
circulated to Members.

 Pursuant to Articles 16.4 and 17 of the Understanding on Rules and Procedures Governing
the Settlement of Disputes ("DSU") and Rule 20 of the Working Procedures for Appellate Review ,
Japan hereby notifies its decision to appeal to the A ppellate Body certain issues of law covered in the
Panel Report on ()
("Panel Report"), and certain legal interpretations developed by the Panel in this dispute. Japan seeks
review by the Appellate Body of the Panel's findings and conclusions that:
1. By maintaining the zeroing procedures for use in original investigations under a transaction-
to-transaction comparison method , the United States acts consistently with Articles 2.1, 2.4
and 2.4.2 of the Agreement on Implementation of Articl e VI of the General Agreement on
Tariffs and Trade 1994 (" Anti-Dumping Agreement "), and Articles VI:1 and VI:2 of the
General Agreement on Tariffs and Trade 1994 ("GATT 1994").1 This conclusion is based on
an erroneous interpretation and application of these provisions. In particular, the Panel erred
in law in finding that:
(i) Articles 2.1 and 2.4.2 and Articles VI:1 and VI:2 do not require that "dumping" and
"margins of dumping" be determined for the "product" under investigation as a whole
and, instead, permit a determination of dumping for individual export transactions;2
(ii) Article 2.4.2 permits the use of the zeroing procedures under the transaction-to-
transaction comparison method set out in the first sentence of that provision;3 and,
(iii) Article 2.4 is subject to the allegedly "more specific" provisions of Articles 2.4.2 and
9, and the zeroing procedures entail a "fair comparison" of export price and normal
value.4

1 See Panel Report, paras. 7.143, 7.161 and 7.259(a).
2 See, for example, Panel Report, paras. 7.92 to 7.102, 7.104 to 7.112, 7.118 to 7.120, 7.139, and 7.141
to 7.143.
3 See, for example, Panel Report, paras. 7.118 to 7.120, 7.127 to 7.143.
4 See, for example, Panel Report, paras. 7.157 to 7.161.

2. By maintaining the zeroing procedures for use in periodic reviews
, the United States acts
consistently with Articles 2.1, 2.4, 9.1, 9.2 and 9.3 of the Anti-Dumping Agreement , and
Articles VI:1 and VI:2 of the GATT 1994. 5 This conclusion is based on an erroneous
interpretation and application of these provisions. In particular, the Panel erred in law in
finding that:
(i) Articles 2.1, 9.1, 9.2 and 9.3, and Artic les VI:1 and VI:2, do not require, for purposes
of periodic reviews, that "dumping" and "mar gins of dumping" be determined for the
"product" under investigation as a whole and, instead, permit a determination of
dumping for individual export transactions;6
(ii) Articles 9.1, 9.2 and 9.3, and Articles VI:1 and VI:2, permit, as a consequence, the
assessment of the maximum amount of anti-dumping duties payable on the basis of a
transaction-specific margin of dumping, instead of a margin of dumping for the
"product" as a whole, for the foreign exporter or producer;
7 and,
(iii) Article 2.4 is subject to the "more specif ic" provisions of Articles 2.4.2 and 9, and the
zeroing procedures involve a "fair comparis on" of export price and normal value
under this provision.8
3. By applying the zeroing procedures in eleven periodic reviews identified in Exhibits JPN-11 to
JPN-21, the United States acted consistently with Articles 2.1, 2.4, 9.1, 9.2 and 9.3 of the Anti-
Dumping Agreement, and Articles VI:1 and VI:2 of the GATT 1994. 9 This conclusion is based
on an erroneous interpretation and application of these provisions, as described in paragraph 2
above.10
4. By maintaining the zeroing proce dures for use in new shipper reviews , the United States acts
consistently with Articles 2.1, 2.4 and 9.5 of the Anti-Dumping Agreement, and Articles VI:1
and VI:2 of the GATT 1994. 11 This conclusion is based on an erroneous interpretation and
application of these provisions. In particular, the Panel erred in law in finding that:
(i) Articles 2.1 and 9.5, and Articles VI:1 and VI:2, do not require that "dumping" and
"margin of dumping" be determined for the "product" under investigation as a whole
and, instead, permit a determination of dumping for individual export transactions; 12
and,
(ii) Article 2.4 is subject to the "more specif ic" provisions of Articles 2.4.2 and 9, and the
zeroing procedures involve a "fair comparison" of export price and normal value.13

5 See Panel Report, paras. 7.216, 7.219, 7.222, and 7.259(b).
6 See, for example, Panel Report, paras. 7.194 to 7.209, 7.216, 7.221 and 7.222.
7 See, for example, Panel Report, paras. 7.194 to 7.209, 7.216, 7.221 and 7.222.
8 See, for example, Panel Report, paras. 7.218 and 7.219. See also Panel Report, paras. 7.157 to 7.160,
and 7.196 to 7.209.
9 See Panel Report, paras. 7.227 and 7.259(c).
10 See Panel Report, paras. 7.226 and 7.227.
11 See Panel Report, paras. 7.216, 7.219, 7.222, and 7.259(b).
12 See, for example, Panel Report, paras. 7.194 to 7.209, 7.216, 7.221 and 7.222.
13 See, for example, Panel Report, paras. 7.218 and 7.219. See also Panel Report, paras.7.157 to 7.160
and 7.196 to 7.209.

5. By relying, in the two sunset reviews identified in Exhibits JPN-22 and JPN-23, on margins
of dumping calculated using the zeroing procedur es in previous periodic reviews, the United
States acted consistently with Articles 2.1, 2.4 and 11.3 of the Anti-Dumping Agreement .14
This conclusion is in error because it is based on the Panel's erroneous conclusion, described
in paragraph 2 above, that the zeroing procedures are permitted in periodic reviews.15
 In sum, Japan considers that the Panel erred in law in the interpreta tion and application of
Articles 2.1, 2.4, 2.4.2, 9.1, 9.2, 9.3, 9.5 and 11.3 of the Anti-Dumping Agreement, and Articles VI:1
and VI:2 of the GATT 1994. Japan requests that, u pon reversal of the Panel's erroneous findings and
conclusions identified above, the A ppellate Body resolve this dispute promptly by finding that the
United States violates these provisions by maintaining and applying the zeroing procedures.